First Security (FSGI) 8-K First Security Group Announces Third Quarter Profits

First Security Group, Inc. and Subsidiary

Consolidated Balance Sheets

	September 30, 2014			December 31, 2013			September 30, 2013
(in thousands)	(unaudited)						(unaudited)
ASSETS
Cash and Due from Banks	$	11,519		$	10,742		$	10,357
Interest Bearing Deposits in Banks	7,344			10,126			59,943
Cash and Cash Equivalents	18,863			20,868			70,300
Securities Available-for-Sale	98,677			172,830			207,009
Securities Held-to-Maturity, at amortized cost (fair value - $131,549 at September 30, 2014, $132,104 at December 31, 2013 and $130,170 at September 30, 2013)	129,313			132,568			129,164
Loans Held-for-Sale	46,904			220			1,661
Loans	666,728			583,097			534,627
Less: Allowance for Loan and Lease Losses	8,600			10,500			10,700
Net Loans	658,128			572,597			523,927
Premises and Equipment, net	27,862			27,888			28,810
Bank Owned Life Insurance	29,020			28,346			28,155
Other Real Estate Owned	5,952			8,201			8,662
Other Assets	13,163			14,056			14,167
TOTAL ASSETS	$	1,027,882		$	977,574		$	1,011,855
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES
Deposits
Noninterest Bearing Demand	$	155,177		$	144,365		$	147,865
Interest Bearing Demand	104,404			95,559			92,108
Savings and Money Market Accounts	252,218			206,125			215,293
Certificates of Deposit less than $100 thousand	157,629			182,408			195,129
Certificates of Deposit of $100 thousand or more	125,606			153,750			170,466
Brokered Deposits	83,995			75,062			88,987
Total Deposits	879,029			857,269			909,848
Federal Funds Purchased and Securities Sold under Agreements to Repurchase	12,878			12,520			12,657
Other Borrowings	43,485			20,000			—
Other Liabilities	4,527			4,137			5,962
Total Liabilities	939,919			893,926			928,467
SHAREHOLDERS’ EQUITY
Common Stock – $.01 par value – 150,000,000 shares authorized; 66,826,254 shares issued as of September 30, 2014, 66,602,601 shares issued as of December 31, 2013, and 66,602,601 shares issued as of September 30, 2013	766			764			764
Paid-In Surplus	197,326			196,536			196,059
Accumulated Deficit	(102,547		)	(104,042		)	(103,395		)
Accumulated Other Comprehensive Loss	(7,582		)	(9,610		)	(10,040		)
Total Shareholders’ Equity	87,963			83,648			83,388
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,027,882		$	977,574		$	1,011,855

First Security Group, Inc. and Subsidiary

Consolidated Statements of Operations

(unaudited)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
(in thousands, except per share data)	2014		2013			2014			2013
INTEREST INCOME
Loans, including fees	$	8,805	$	6,461		$	23,493		$	19,537
Investment Securities – taxable	887		1,321			2,883			3,143
Investment Securities – non-taxable	86		312			524			749
Other	2		77			52			338
Total Interest Income	9,780		8,171			26,952			23,767
INTEREST EXPENSE
Interest Bearing Demand Deposits	42		62			137			213
Savings Deposits and Money Market Accounts	193		188			467			628
Certificates of Deposit of less than $100 thousand	253		466			824			1,551
Certificates of Deposit of $100 thousand or more	246		475			793			1,558
Brokered Deposits	484		795			1,576			2,873
Other	75		20			198			51
Total Interest Expense	1,293		2,006			3,995			6,874
NET INTEREST INCOME	8,487		6,165			22,957			16,893
Provision (Credit) for Loan and Lease Losses	11		(1,632		)	(1,231		)	(1,780		)
NET INTEREST INCOME AFTER CREDIT FOR LOAN AND LEASE LOSSES	8,476		7,797			24,188			18,673
NONINTEREST INCOME
Service Charges on Deposit Accounts	778		798			2,288			2,298
Mortgage Banking Income	462		420			921			927
Gain on Sales of Securities Available-for-Sale	10		—			628			154
Gain on Sales of Loans	254		—			726			—
Other	1,301		1,074			3,907			3,118
Total Noninterest Income	2,805		2,292			8,470			6,497
NONINTEREST EXPENSES
Salaries and Employee Benefits	5,153		5,807			15,652			17,081
Expense on Premises and Fixed Assets, net of rental income	1,379		1,547			4,052			4,301
Other	3,690		3,843			11,064			16,232
Total Noninterest Expenses	10,222		11,197			30,768			37,614
INCOME (LOSS) BEFORE INCOME TAX PROVISION (BENEFIT)	1,059		(1,108		)	1,890			(12,444		)
Income Tax Provision	132		322			395			358
NET INCOME (LOSS)	927		(1,430		)	1,495			(12,802		)
Preferred Stock Dividends	—		—			—			(929		)
Accretion on Preferred Stock Discount	—		—			—			(452		)
Effect of Exchange of Preferred Stock to Common Stock	—		—			—			26,179
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	927	$	(1,430	)	$	1,495		$	11,996
NET INCOME PER SHARE:
Net Income (Loss) Per Share – Basic	$	0.01	$	(0.02	)	$	0.02		$	0.30
Net Income (Loss) Per Share – Diluted	$	0.01	$	(0.02	)	$	0.02		$	0.30
Dividends Declared Per Common Share	$	—	$	—		$	—		$	—