Sunshine Bancorp (SBCP) 8-K Sunshine Bancorp, Inc. Reports First Quarter 2016 Financial Results

Sunshine Bancorp

Press Release

For Immediate Release

Contact:

Brent Smith

SVP, Corporate Development

(813)659-8626

Sunshine Bancorp, Inc. Reports First Quarter 2016 Financial Results

Plant City, FL - April 27, 2016 –

Sunshine Bancorp, Inc. (the “Company”) (NASDAQ: SBCP), the holding company for Sunshine Bank (the “Bank”), has released its unaudited financial results for the first quarter of 2016.

Net income for the three months ended March 31, 2016 was $154,000 compared to a net loss of $1.8 million for the three months ended December 31, 2015 and compared to a net loss of $353,000 for the three months ended March 31, 2015.

Total assets were $523.1 million at March 31, 2016 compared to $507.3 million at December 31, 2015 and $247.6 million at March 31, 2015.  The Bank continued to experience strong organic loan and deposit growth for the first quarter of 2016.  The loan and deposit portfolios as of March 31, 2016 totaled $337.8 million and $415.2 million, respectively, compared to $326.3 million and $399.1 million, respectively, at December 31, 2015. Loan growth for the first quarter 2016 was $11.5 million, or 14.0% annualized. Additionally, organic deposit growth for the first quarter 2016 was $16.1 million, or 12.0% annualized.  The Bank has continued to allow municipal deposits that do not have a corresponding lending relationship to runoff.  During the first quarter of 2016, the balance of public funds deposits decreased by $6.3 million.

Heading into the second quarter the Company is seeing its strongest loan pipeline in the past five quarters.  However, the Company is still experiencing significant competitive pressures even as the Florida economy continues to expand. These competitive pressures include below market pricing and an apparent loosening of credit underwriting standards.  In response, the Company remains focused on its disciplined credit underwriting standards and has focused its growth on relationship banking and targeted asset class diversification.

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The Bank’s non-performing assets as of March 31, 2016 were $985,000 compared to $783,000 as of December 31, 2015.   The increase was due to one commerical real estate loan being placed on nonaccrual status. The Bank’s non-performing assets to total asset ratio as of March 31, 2016 was 0.19% compared to 0.15% as of December 31, 2015. In addition, the allowance for loan losses was 265.7% of non-performing loans at March 31, 2016.

Non-interest income for the three months ended March 31, 2016 was $667,000 compared to $409,000 for the three months ended March 31, 2015.  The increase of $258,000 was attributable to increases in service charges on deposit, mortgage broker fees and wealth management income.

Non-interest expense was $4.5 million for the three months ended March 31, 2016 compared to $2.7 million for the three months ended March 31, 2015. During the first quarter of 2016, the Bank had a robbery that resulted in a $50,000 loss which is the retention amount of its financial institution bond.  The Company believes there are additional opportunities to reduce operational expenses and is currently evaluating further steps necessary to implement cost savings.

Andrew Samuel, President and CEO, commented, “In the first quarter of 2016, we made decisions to walk away from some organic growth opportunities that did not fit our focus on relationship oriented growth.  We are confident that this distinction will provide enhanced long term value for our organization.  Strategic opportunities continue to present themselves with seller pricing expectations remaining high.  We have evaluated and continue to evaluate different strategic options while remaining focused on our disciplined acquisition criteria.”

Net interest income for the first quarter of 2016 increased $2.5 million, compared to the prior year period as a result of balance sheet growth.

In March 2016 the Company successfully completed a private issuance of subordinated debt totaling $11 million.  The total amount was contributed to the Bank to support ongoing loan growth.  Stockholders’ equity increased $542,000 to $71.9 million at March 31, 2016 compared to $71.4 million at December 31, 2015.  Sunshine Bank exceeds the well-capitalized levels with a March 31, 2016 leverage ratio of 11.3% compared to 9.8% at December 31, 2015 and 16.6% at March 31, 2015.

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Forward Looking Statements

This news release contains forward-looking statements within the meaning of the federal securities laws. Statements in this release that are not strictly historical are forward-looking and are based upon current expectations that may differ materially from actual results. These forward-looking statements, identified by words such as “will,” “expected,” “believe,” and “prospects,” involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. These risks and uncertainties involve general economic trends and changes in interest rates, increased competition, changes in consumer demand for financial services, the possibility of unforeseen events affecting the industry generally, the uncertainties associated with newly developed or acquired operations, and market disruptions. The Company undertakes no obligation to release revisions to these forward-looking statements publicly to reflect events or circumstances after the date hereof or to reflect the occurrence of unforeseen events, except as required to be reported under the rules and regulations of the Securities and Exchange Commission.

About Sunshine Bancorp, Inc.

Sunshine Bancorp, Inc. was formed in 2014 as the holding company for Sunshine Bank. The bank was first organized in 1954 in Plant City.  In 2014 after converting from the mutual form of organization to the stock form, the current name of Sunshine Bank was adopted. Operations are conducted from the main office in Plant City, Florida and eleven additional offices in Hillsborough, Polk, Manatee, Orange, and Pasco Counties, Florida. The Company provides community bank financial services to individuals, families, and business customers. Sunshine’s common stock is traded on the NASDAQ Capital Market under the symbol “SBCP.” For further information, visit the Company website www.mysunshinebank.com.

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Sunshine Bancorp, Inc.
Consolidated Balance Sheet
(Dollars in thousands, except per share information)
	As of March 31,			As of December 31,			As of March 31,
	2016			2015			2015
	(Unaudited)						(Unaudited)
Assets
Cash and due from banks	$	12,490		$	13,220		$	5,110
Interest-earning deposits in financial institutions		30,686			16,523			10,822
Federal funds sold		18,443			29,601			28,933
Cash and cash equivalents		61,619			59,344			44,865
Time deposits with banks		3,920			4,410			5,390
Securities available for sale		70,005			65,944			60,039
Loans held for sale		453			790			347
Loans, net of allowance for loan losses of $2,532 and $2,511		337,784			326,266			118,675
Premises and equipment, net		17,613			17,612			6,751
Federal Home Loan Bank stock, at cost		1,306			1,597			211
Cash surrender value of bank-owned life insurance		12,203			12,122			7,317
Deferred income tax asset		6,272			6,426			2,825
Goodwill and other intangibles		10,071			10,101			-
Accrued interest receivable		1,050			1,048			543
Other real estate owned		32			32			41
Other assets		739			1,573			573
Total assets	$	523,067		$	507,265		$	247,577
Liabilities and Stockholders’ Equity
Liabilities:
Noninterest-bearing demand accounts	$	101,490		$	89,114		$	47,344
Interest-bearing demand and savings accounts		207,410			198,977			99,732
Time deposits		106,300			111,020			35,997
Total deposits		415,200			399,111			183,073
Short-term borrowings		21,238			28,927			-
Long-term borrowings		11,000			-			-
Other liabilities		3,693			7,833			3,074
Total liabilities		451,131			435,871			186,147
Stockholders’ equity:
Common stock		53			53			42
Additional paid in capital		52,975			52,763			40,766
Retained income		22,000			21,846			23,738
Unearned employee stock ownership plan (“ESOP”) shares		(3,160	)		(3,160	)		(3,273	)
Accumulated other comprehensive income		68			(108	)		157
Total stockholders’ equity		71,936			71,394			61,430
Total liabilities and stockholders’ equity	$	523,067		$	507,265		$	247,577

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Sunshine Bancorp, Inc.
Consolidated Statement of Operations
(Unaudited),(in thousands, except per share information)
	Three months Ended
	March 31,
		2016		2015
Interest income:
Loans	$	4,055	$	1,529
Securities		221		223
Other		78		33
Total interest income		4,354		1,785
Interest Expense:
Deposits		315		67
Borrowed funds		25		-
Total interest expense		340		67
Net interest income		4,014		1,718
Provision for loan losses		-		-
Net interest income after provision for loan losses		4,014		1,718
Noninterest income:
Fees and service charges on deposit accounts		326		139
Gain on sale of other real estate owned		-		-
Mortgage Broker Fees		47		16
Gain on sale of securities		26		142
Income from bank-owned life insurance		95		58
Other		173		54
Total noninterest income		667		409
Noninterest expenses:
Salaries and employee benefits		2,576		1,564
Occupancy and equipment		576		299
Data and item processing services		341		120
Professional fees		171		124
Advertising and promotion		45		38
Stationery and supplies		46		25
FDIC Deposit insurance		102		56
Merger related		-		258
Other		621		262
Total noninterest expenses		4,478		2,746
Income (Loss) before income taxes		203		(619	)
Income tax (benefit) expense		49		(266	)
Net income (loss)	$	154	$	(353	)
Basic and Dilutive earnings (loss) per share	$	0.03	$	(0.09	)

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	Quarter Ended *
	3/31/2016			12/31/2015			9/30/2015			6/30/2015			3/31/2015
Operating Highlights	(Unaudited)
Net Income	$	154		$	(1,776	)	$	35		$	(151	)	$	(353	)
Net interest income		4,014			3,938			3,786			1,724			1,718
Provision for loan losses		-			-			-			-			-
Non-Interest Income		667			471			425			324			409
Non-Interest Expense		4,478			6,863			4,141			3,526			2,746
Financial Condition Data:
Total Assets	$	523,067		$	507,265		$	442,085		$	476,989		$	247,577
Loans, Net		337,784			326,266			320,356			307,002			118,675
Deposits:
Noninterest-bearing demand accounts		101,490			89,114			68,297			71,539			43,798
Interest-bearing demand and savings accounts		207,410			198,977			184,958			168,859			99,732
Time deposits		106,300			111,020			100,724			108,899			35,997
Total Deposits		415,200			399,111			353,979			349,297			179,527
Selected Ratios
Net interest margin		3.64	%		3.78	%		3.72	%		2.78	%		3.24	%
Annualized return on average assets		0.1	%		(1.5	%)		0.0	%		(0.3	%)		(0.6	%)
Annualized return on average equity		0.9	%		(11.2	%)		0.1	%		(1.0	%)		(2.3	%)
Capital Ratios **
Total Capital Ratio		15.6	%		13.1	%		14.3	%		15.1	%		31.3	%
Tier 1 capital ratio		14.9	%		12.4	%		13.8	%		14.5	%		30.0	%
Common equity tier 1 capital ratio		14.9	%		12.4	%		13.8	%		14.5	%		30.0	%
Leverage ratio		11.3	%		9.8	%		10.6	%		20.1	%		16.6	%
Asset Quality Ratios
Non-performing assets	$	985		$	783		$	1,055		$	1,666		$	413
Non-performing assets to total assets		0.19	%		0.15	%		0.24	%		0.35	%		0.17	%
Non-performing loans to total loans		0.28	%		0.24	%		0.32	%		0.53	%		0.31	%
Allowance for loan losses(AFLL)	$	2,532		$	2,511		$	1,947		$	1,883		$	1,743
AFLL to total loans		0.74	%		0.76	%		0.60	%		0.61	%		1.45	%
AFLL to  non-performing loans		265.7	%		334.4	%		190.3	%		115.2	%		468.6	%
* Dollars in thousands
** Capital Ratios for Sunshine Bank only