SBT Bancorp (SBTB) 8-K SBT Bancorp, Inc. Reports First Quarter 2015 Results

Exhibit 99.1

SBT Bancorp, Inc. Reports First Quarter 2015 Results

SIMSBURY, Conn.--(BUSINESS WIRE)--April 28, 2015--SBT Bancorp, Inc., (OTCQX: SBTB), holding company for The Simsbury Bank & Trust Company, today announced net income of $343,000 or $0.36 basic and diluted earnings per share for the quarter ended March 31, 2015, compared to a net income of $78,000 or $0.06 basic and diluted earnings per share, an increase of $0.30 diluted earnings per share compared to the prior year quarter. The increase in net income is mainly due to a $391,000 decrease in noninterest expense, a $177,000 increase in mortgage banking activities, partially offset by a decrease in other service charges and fees of $143,000.

“The Bank showed strong loan growth as compared to March 31, 2014,” said Martin J. Geitz, President and Chief Executive Officer. “Commercial banking continues to grow, with commercial loan balances increasing by $11.0 million or 13.5% since March 31, 2014. Performance of our mortgage unit has showed some improvement during the first quarter of 2015. We experienced a significant increase in applications and closed purchased mortgages during the quarter. The launch of the wholesale mortgage origination channel has contributed incremental loan volume to our retail origination platform, and we expect measured improvement in the mortgage business contribution to earnings.”

Key highlights for March 31, 2015 compared to March 31, 2014 included:

• Net loans grew $13.9 million or 5.0%.
• Quarter-to-date 2015 net interest margin of 3.05% was 1 basis point higher compared to quarter-to-date March 31, 2014.
• Total deposits decreased $11.0 million driven by reductions in CD’s ($8.6mm) and Money Market Accounts ($9.1mm). These were partially offset by growth in Checking ($1.4mm) and Savings Accounts ($5.3mm).
• Total loan delinquency (non-accrual and delinquent loans) decreased to 1.12% of total loans compared to the previous year’s 1.33%. Overall loan delinquency remains favorable to peers.
• The allowance for loan losses at March 31, 2015 was 0.96% of total loans.
• The Bank’s Total Risk Based Capital ratio remains strong, ending the first quarter of 2015 at 12.60% (estimated).

On March 31, 2015, loans outstanding were $292 million, an increase of $13.9 million, or 5.0% over a year ago. Commercial loans grew by $11.0 million or 13.5% and residential mortgage loans decreased by $1.3 million or 1.0%. Consumer loans grew by $5.1 million or 9.1%, mainly due to an increase in purchased auto loans.

The Company’s loan portfolio remains strong. The Company’s allowance for loan losses at March 31, 2015 was 0.96% of total loans. The Company had non-accrual loans totaling $2.2 million equal to 0.73% of total loans on March 31, 2015 compared to non-accrual loans totaling $2.3 million or 0.84% of total loans a year ago. Total non-accrual and delinquent loans on March 31, 2015 was 1.12% of loans outstanding compared to 1.33% on March 31, 2014.

Total deposits on March 31, 2015 were $361 million, a decrease of $11.0 million or 3.0% over a year ago primarily due to a decrease in time deposits of $8.6 million and a $2.4 million decrease in low cost Demand, Savings and NOW deposits. At quarter-end, 30% of total deposits were in non-interest bearing demand accounts, 53% were in low-cost savings, money market and NOW accounts and 17% were in time deposits.

For the first quarter 2015, total revenues, consisting of net interest and dividend income plus noninterest income, were $3,418,000 compared to $3,399,000 a year ago, an increase of $19,000 or 0.6%. Non-interest income increased by $18,000 or 3.5%, primarily due to an increase in mortgage banking activities of $177,000 and security gains of $43,000, offset by a reduction of fee revenue of $138,000. Over this period, net interest and dividend income remained flat at $2.9 million.

The Company’s year-to-date 2015 taxable-equivalent net interest margin (taxable-equivalent net interest and dividend income divided by average earning assets) was 3.05% compared to 3.04% for the comparable 2014 period. The Company’s yield on earning assets decreased 1 basis point to 3.25%, while the cost of funds decreased 3 basis points to 0.29% for the three months ended March 31, 2015 compared to the same period of 2014.

Total noninterest expense for the first quarter 2015 was $2,969,000, a decrease of $391,000 or 11.6% below the first quarter of 2014. The $391,000 decrease was primarily due to decreases of $393,000 in salaries and employee benefits, $51,000 related to correspondent bank charges, and a $25,000 reduction in FDIC assessment. These decreases were offset slightly by increases in occupancy and equipment expense of $31,000 and an increase in professional fees of $28,000.

Capital levels for The Simsbury Bank & Trust Company on March 31, 2015 were above those required to meet the regulatory “well-capitalized” designation. Estimated capital ratios are calculated under Basel III rules, which became effective January 1, 2015.

Capital Ratios (estimated) March 31, 2015
	Simsbury Bank & Trust Company	Regulatory Standard For Well-Capitalized
Tier 1 Leverage Capital Ratio	7.11%	5.00%
Tier 1 Risk-Based Capital Ratio	11.49%	8.00%
Total Risk-Based Capital Ratio	12.60%	10.00%
Common Equity Tier 1 Risk-based Capital Ratio	11.49%	6.50%

Simsbury Bank is an independent, community bank for consumers and businesses. The Bank serves customers through full-service branches in central Connecticut; mortgage loan advisors and commercial bankers active throughout Southern New England; Simsbury Bank Online internet banking at simsburybank.com; Simsbury Bank Mobile Banking; 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 on the OTCQX marketplace under the ticker symbol of 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. and Subsidiary
Condensed Consolidated Balance Sheets
	March 31, 2015 and 2014
(Unaudited)
(In Thousands, Except Share Data)
		3/31/2015			3/31/2014
ASSETS
	Cash and due from banks	$	9,934		$	9,284
	Interest-bearing deposits with Federal Reserve Bank of Boston
	and Federal Home Loan Bank		4,016			12,678
	Money market mutual funds		509			345
	Federal funds sold		43			774
	Cash and cash equivalents		14,502			23,081
	Investments in available-for-sale securities (at fair value)		81,332			86,694
	Federal Home Loan Bank stock, at cost		1,881			2,196
	Loans held-for-sale		4,531			2,989
	Loans outstanding		292,252			278,315
	Less allowance for loan losses		2,799			2,779
	Loans, net		289,453			275,536
	Premises and equipment		1,426			1,610
	Accrued interest receivable		1,004			989
	Other real estate owned		-			155
	Bank owned life insurance		7,236			6,778
	Other assets		4,477			4,692
	Total other assets		14,143			14,224
	TOTAL ASSETS	$	405,842		$	404,720
LIABILITIES AND STOCKHOLDERS' EQUITY
	Deposits:
	Demand deposits	$	108,596		$	108,941
	Savings and NOW deposits		192,092			194,136
	Time deposits		59,874			68,517
	Total deposits		360,562			371,594
	Securities sold under agreements to repurchase		3,078			3,335
	Federal Home Loan Bank advances		10,500			-
	Other liabilities		1,669			1,720
	Total liabilities		375,809			376,649
	Stockholders' equity:
	Preferred stock, senior non-cumulative perpetual, Series C, no par; 9,000
	shares issued and outstanding at March 31, 2015 and 2014;
	liquidation value of $1,000 per share		8,991			8,979
	Common stock, no par value; authorized 2,000,000 shares;
	issued and outstanding 906,350 shares and 905,936 shares, respectively,
	at 03/31/15 and 900,756 shares and 900,342 shares, respectively, at 03/31/14		10,313			10,146
	Retained earnings		10,741			10,277
	Treasury stock, 414 shares		(7	)		(7	)
	Unearned compensation restricted stock awards		(375	)		(362	)
	Accumulated other comprehensive income (loss)		370			(962	)
	Total stockholders' equity		30,033			28,071
	TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	405,842		$	404,720

SBT Bancorp, Inc. and Subsidiary
Condensed Consolidated Statements of Income
(Unaudited)
(Dollars in thousands, except for per share amounts)
		For the quarter ended
		3/31/2015		3/31/2014
Interest and dividend income:
	Interest and fees on loans	$	2,641	$	2,611
	Investment securities		434		480
	Federal funds sold and overnight deposits		7		11
	Total interest and dividend income		3,082		3,102
Interest expense:
	Deposits		185		212
	Repurchase agreements		1		2
	Federal Home Loan Bank advances		8		1
	Total interest expense		194		215
	Net interest and dividend income		2,888		2,887
Provision for loan losses			50		30
	Net interest and dividend income after
	provision for loan losses		2,838		2,857
Noninterest income:
	Service charges on deposit accounts		104		118
	Gain on available-for-sale securities		43		-
	Other service charges and fees		64		207
	Increase in cash surrender value
	of life insurance policies		52		49
	Mortgage banking activities		216		39
	Investment services fees and commissions		34		61
	Other income		17		38
	Total noninterest income		530		512
Noninterest expense:
	Salaries and employee benefits		1,580		1,973
	Occupancy expense		377		347
	Equipment expense		102		101
	Loss on other real estate owned		-		-
	Advertising and promotions		105		103
	Forms and supplies		32		35
	Professional fees		105		77
	Directors' fees		51		67
	Correspondent charges		29		80
	Postage		1		22
	FDIC Assessment		78		103
	Data Processing Fees		144		145
	Other expenses		365		307
	Total noninterest expense		2,969		3,360
Income before income taxes			399		9
Income tax expense (benefit)			56		(69	)
Net income		$	343	$	78
Less: Preferred stock dividend and accretion		$	25	$	26
Net income available to common stockholders		$	318	$	52
Average shares outstanding, basic			887,891		880,075
Earnings per common share, basic		$	0.36	$	0.06
Average shares outstanding, assuming dilution			888,988		887,004
Earnings per common share, assuming dilution		$	0.36	$	0.06

CONTACT:
Simsbury Bank
Richard J. Sudol, SVP & CFO, 860-651-2067
860-408-4679 (fax)
rsudol@simsburybank.com