SBT Bancorp (SBTB) 8-K SBT Bancorp, Inc. Reports First Quarter 2012 Results

Exhibit 99.1

SBT Bancorp, Inc. Reports First Quarter 2012 Results

SIMSBURY, Conn.--(BUSINESS WIRE)--April 27, 2012--SBT Bancorp, Inc., (OTCBB: SBTB), holding company for Simsbury Bank & Trust Company, today announced net income of $481,000 or $0.47 per diluted share for the first quarter of 2012, compared to $87,000 or $0.03 per diluted share for the first quarter of 2011. Total assets on March 31, 2012 were $362 million, an increase of $37 million or 11% over March 31, 2011.

Key financial highlights for the first quarter of 2012 compared to the first quarter of 2011 include balance sheet and earnings growth, favorable asset quality trends, and a well capitalized regulatory capital position:

• Total assets increased by $37 million or 11%
• Total deposits grew by $30 million or 10%
• Loans outstanding grew by $17 million or 8%
• Quarterly net income increased by $394 thousand or 453%
• First quarter earnings per share increased by $0.44, from $0.03 to $0.47 per diluted share
• Non-interest income increased by $207 thousand or 41%
• Asset quality remained very favorable with total non-accrual loans and loans 30 or more days past due decreasing from 1.30% of loans outstanding on March 31, 2011 to 0.64% of loans outstanding on March 31, 2012
• The Bank’s Total Risk Based Capital ratio ended the first quarter of 2012 at 14.44%.

“Solid growth in deposits, loans and revenue produced the best quarter of earnings for SBT Bancorp since the second quarter of 2007,” stated SBT Bancorp President and CEO, Martin J. Geitz. “Our asset quality continues to be excellent, with total loan delinquency declining to well below 1.00% of total loans at quarter end. We are well positioned to continue building shareholder value with attractive, low-cost, relationship based core deposits; a relatively low-risk mortgage, consumer and commercial loan portfolio; and a strong capital position.”

Total deposits on March 31, 2012 were $329 million, an increase of $30 million or 10% over a year ago. This growth was mainly in Core deposits (Demand, Savings and NOW accounts). At quarter-end, 23% of total deposits were in non-interest bearing demand accounts, 54% were in low-cost savings and NOW accounts, and 23% were in time deposits.

On March 31, 2012, loans outstanding were $222 million, an increase of $17 million, or 8%, over a year ago. Residential mortgage average loans decreased $2.4 million from last year or 2% while average balances for commercial loans increased by $7.1 million or 14% and average consumer balances also increased $5.5 million or 11%. The profile of the Company’s loan portfolio remains relatively low-risk. The Company’s allowance for loan losses at March 31, 2012 was 1.09% of total loans. The Company had non-accrual loans totaling $1.1 million equal to 0.47% of total loans on March 31, 2012 compared to non-accrual loans totaling $2.5 million or 1.09% of total loans a year ago. Total delinquent loans decreased from 1.30% of loans outstanding on March 31, 2011 to 0.64% of loans outstanding on March 31, 2012.

Total revenues, consisting of net interest and dividend income plus noninterest income, were $3,396,000 in the first quarter compared to $2,968,000 a year ago, an increase of $428,000 or 14%. Net interest and dividend income increased by $221,000 or 9%, while noninterest income increased by $207,000 or 41% primarily due to an increase in the gain on loans sold.

The Company’s taxable-equivalent net interest margin (taxable-equivalent net interest and dividend income divided by average earning assets) was 3.17% for the first quarter of 2012, compared to 3.32% for the first quarter of 2011. The Company’s cost of funds declined 32 bps while the yield on interest earning assets decreased 41 bps during the first quarter of 2012, compared to the first quarter of 2011.

Total noninterest expenses were flat at $2,646,000 for the first quarter 2012 compared to first quarter 2011. Salaries and employee benefit expenses decreased $26,000 or 2% while advertising and promotions increased $49,000 or 49%.

Last year’s first quarter net income of $87,000 or $0.03 per diluted share was impacted by a one-time charge of $172,000 related to the Bank’s formation of a Passive Investment Company (PIC). Excluding this one-time charge, net of a favorable income tax adjustment, net income for the first quarter of 2011 would have been $259,000 or $0.23 per common diluted share.

Capital levels for the Simsbury Bank & Trust Company on March 31, 2012 were above those required to meet the regulatory “well-capitalized” designation.

Simsbury Bank is an independent, local bank for consumers and businesses. The Bank has approximately $362 million in assets. The Bank serves customers through full-service offices in Avon, Bloomfield, Granby and Simsbury, Connecticut; loan originators throughout Connecticut and a loan production office in Canton, Connecticut; SBT Online internet banking at simsburybank.com; free ATM transactions at hundreds of machines throughout the northeastern U.S. via the SUM program; and 24 hour telephone banking. The Bank’s wholly-owned subsidiary, SBT Investment Services, Inc., offers securities and insurance products through LPL Financial and its affiliates, Member FINRA/SIPC. Simsbury Bank is wholly-owned by publicly traded SBT Bancorp, Inc. Its stock is traded over-the-counter under the ticker symbol of OTCBB: SBTB. For more information, visit www.simsburybank.com.

Certain statements in this press release, including statements regarding the intent, belief or current expectations of SBT Bancorp, Inc., The Simsbury Bank & Trust Company, or their directors or officers, are “forward-looking” statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.

SBT Bancorp, Inc
Condensed Consolidated Balance Sheets
(Dollars in thousands, except for per share amounts)
		3/31/2012			12/31/2011			3/31/2011
		(unaudited)						(unaudited)
ASSETS
	Cash and due from banks	$	8,111		$	19,217		$	6,457
	Interest-bearing deposits with Federal Reserve Bank of Boston		45,882			65,292			37,677
	Interest-bearing deposits with the Federal Home Loan Bank		2			1			4
	Federal funds sold		1,353			2,024			1,794
	Money market mutual funds		5,345			5,346			8,344
	Cash and cash equivalents		60,693			91,880			54,276
	Interest-bearing time deposits with other bank		3,679			4,728			4,885
	Investments in available-for-sale securities (at fair value)		66,698			56,859			53,812
	Federal Home Loan Bank stock, at cost		569			660			660
	Loans outstanding		221,654			216,552			204,750
	Less allowance for loan losses		2,422			2,469			2,322
	Loans, net		219,232			214,083			202,428
	Premises and equipment		675			679			535
	Other real estate owned		279			-			350
	Accrued interest receivable		934			964			929
	Bank owned life insurance		6,212			4,173			4,053
	Other assets		2,865			3,013			3,195
	Total other assets		10,965			8,829			9,062
	TOTAL ASSETS	$	361,836		$	377,039		$	325,123
LIABILITIES AND STOCKHOLDERS' EQUITY
	Deposits:
	Demand deposits	$	76,632		$	103,778		$	58,277
	Savings and NOW deposits		177,241			164,318			164,223
	Time deposits		75,592			76,681			76,749
	Total deposits		329,465			344,777			299,249
	Securities sold under agreements to repurchase		2,715			3,548			2,935
	Due to broker		500			-			-
	Other liabilities		1,348			1,271			1,012
	Total liabilities		334,028			349,596			303,196
	Stockholders' equity:
	Preferred Stock - Series A		-			-			3,862
	Preferred Stock - Series B		-			-			218
	Preferred Stock - Series C		8,955			8,952			-
	Common Stock, no par value; authorized 2,000,000 shares;
	issued and outstanding 876,672 shares on 3/31/12, 876,394
	shares on 12/31/11, and 864,976 shares on 3/31/11, respectively		9,625			9,620			9,381
	Treasury Stock, 414 shares		(7	)		(7	)		-
	Unearned compensation restricted stock awards		(181	)		(199	)		-
	Retained earnings		8,673			8,360			8,174
	Accumulated other comprehensive income		743			717			292
	Total stockholders' equity		27,808			27,443			21,927
	TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	361,836		$	377,039		$	325,123

SBT Bancorp, Inc
Condensed Consolidated Statements of Income
(Unaudited)
(Dollars in thousands, except for per share amounts)
		For the quarter ended
			3/31/2012		3/31/2011
Interest and dividend income:
	Interest and fees on loans	$	2,502	$	2,475
	Investment securities		414		398
	Federal funds sold and overnight deposits		38		17
	Total interest and dividend income		2,954		2,890
Interest expense:
	Deposits		268		418
	Repurchase agreements		1		8
	Total interest expense		269		426
	Net interest and dividend income		2,685		2,464
Provision for loan losses			90		-
	Net interest and dividend income after
	provision for loan losses		2,595		2,464
Noninterest income:
	Service charges on deposit accounts		122		113
	Gain on sales of available-for-sale securities		23		107
	Other service charges and fees		153		128
	Increase in cash surrender value
	of life insurance policies		40		40
	Gain on loans sold		349		47
	Investment services fees and commissions		23		66
	Other income		1		3
	Total noninterest income		711		504
Noninterest expense:
	Salaries and employee benefits		1,387		1,413
	Premises and equipment		339		362
	Advertising and promotions		149		100
	Forms and supplies		43		52
	Professional fees		145		158
	Directors' fees		57		39
	Correspondent charges		99		76
	Postage		27		21
	FDIC Assessment		23		129
	Data Processing Fees		114		109
	Other expenses		263		193
	Total noninterest expense		2,646		2,652
Income before income taxes			660		316
Income tax provision			179		229
Net income		$	481	$	87
Net income available to common shareholders		$	416	$	23
Average shares outstanding, basic			865,237		864,976
Earnings per common share, basic		$	0.48	$	0.03
Average shares outstanding, assuming dilution			876,563		865,256
Earnings per common share, assuming dilution		$	0.47	$	0.03

CONTACT:
The Simsbury Bank & Trust Company
Anthony F. Bisceglio, 860-408-5493
EVP & CFO
860-408-4679 (fax)
abisceglio@simsburybank.com