Exhibit 19
(Triangle Bancorp logo appears here)
P.O. Box 31828
Raleigh, NC 27622
1996
Third Quarter Report
3
(Triangle Bancorp logo appears here)
Dear Shareholder:
The third quarter of 1996 was another record breaking quarter for
Triangle Bancorp. Net income for the quarter was $2.8 million, an
increase of 21% over the same period in 1995. Earnings per share for the
quarter were $.28 compared to $.23 for the third quarter of 1995, an
increase of 22%.
For the nine months ended September 30, 1996, earnings
were $7.9 million, a 52% increase over the $5.2 million earned during
the same period in 1995. Earnings per share were $.79 compared to $.54
for the same period in 1995. Excluding the sale of a branch and
merger-related expenses, core earnings for the nine months ended September 30,
1996 were $7.7 million, a 22% increase over the $6.3 million earned during the
same period in 1995.
Total assets of the Corporation on September 30, 1996 were $904 million,
an increase of $117 million or 15% over the $787 million reported on September
30, 1995. Net loans and deposits for the period were $614 million and $782
million, respectively, compared to $519 million and $676 million, respectively,
at September 30, 1995.
We continue to be pleased with the excellent quality of our loan
portfolio. The ratio of nonperforming loans and other real estate owned to gross
loans was .54% at the quarter ended September 30, 1996 compared to .67% at
September 30, 1995. For the year, net chargeoffs as a percentage of average
loans were only .04% compared to .12% for 1995. In addition, our percentage of
loan loss reserves to nonperforming loans and other real estate compares
favorably to our peers, with a coverage ratio of 280%.
We are extremely gratified by the third quarter and year-to-date
results. The improvement in earnings is primarily a result of the increase in
net interest income due to the growth of average earning assets from $674
million in the third quarter of 1995 to $810 million in the third quarter of
1996. At the same time, the efficiency ratio has improved significantly from 65%
for the quarter ended September 30th, 1995 to 60% for the same period in 1996,
as we continue to gain the efficiencies from our acquisitions in 1995.
In our continuing efforts to improve our convenience to customers and to
gain market share in the communities we serve, we opened two new offices during
the third quarter and will open two additional new offices during the fourth
quarter, primarily in Metropolitan Statistical Areas (MSAs). These include
offices in Wake, Cumberland, Pitt and Craven counties. This is consistent with
our plans to continue concentrating our growth in MSAs and will bring our total
number of branch offices to 41. In addition to our new locations, new products
and services will be available to our commercial customers in the fourth
quarter. These products and services include PC-access to accounts to perform
such duties as ACH origination and cash management.
We have received regulatory and shareholder approvals for the
acquisition of Granville United Bank in Oxford, North Carolina. Granville United
has assets of $61 million at September 30, 1996 and plans call for it to be
merged into Triangle Bank this month. This will add three additional offices and
increase our total number of banking locations to 44.
The quarterly cash dividend has increased by 33% from .06 cents to .08
cents per share since the third quarter of 1995. We continued to be pleased with
the performance of our stock and the "outperform" rating we received from Wheat
First Securities, Inc. in their latest analyst report dated September 6, 1996.
We appreciate the support of our shareholders and encourage you to use
the services of our Bank as well as recommend us to others.
Sincerely,
(Signature of Michael S. Patterson)
Michael S. Patterson
President and CEO
Summary Balance Sheets
(In thousands)
9/30/96 9/30/95
Assets
Cash, Due from Banks,
and Federal Funds Sold $ 48,762 $ 48,753
Investments, Market Value of
$191,215 and $174,085 192,414 173,517
Loans Less Allowance of
$9,392 and $8,709 614,934 521,859
Other Assets 47,455 42,459
Total Assets $ 903,565 $ 786,588
Liabilities and
Shareholders' Equity
Demand Deposits $ 128,564 $ 113,257
Interest Bearing Deposits 653,289 562,957
Total Deposits 781,853 676,214
Other Borrowings 34,681 27,091
Other Liabilities 9,265 12,552
Total Other Liabilities 43,946 39,643
Total Liabilities 825,799 715,857
Shareholders' Equity
Common Stock; no par value;
20,000 shares authorized;
9,694 shares and 9,679
shares outstanding at
September 30, 1996 and
1995, respectively 56,722 56,801
Undivided Profits 21,616 14,377
Net Unrealized Loss on Securities
Available for Sale (572) (447)
Total Shareholders' Equity 77,766 70,731
Total Liabilities and
Shareholders' Equity $ 903,565 $ 786,588
Triangle Bancorp, Inc. and Subsidiary
Summary Statements of Income and Expense
(In thousands, except per share data)
For the Three Months Ended For the nine Months Ended
9/30/96 9/30/95 9/30/96 9/30/95
Interest Income $ 17,867 $ 14,935 $ 50,711 $ 42,851
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Interest Expenses 8,019 6,715 22,577 18,367
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Net Interest Income 9,848 8,220 28,134 24,484
Provision for Loan Losses 290 30 1,315 255
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Net Interest Income
After Provision 9,558 8,190 26,819 24,229
Noninterest Income 2,032 1,872 6,467 5,297
Noninterest Expense 7,048 6,435 20,552 19,941
Merger Expenses 131 102 189 1,640
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Net Income Before Taxes 4,411 3,525 12,545 7,945
Income Tax Expense 1,630 1,230 4,645 2,705
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Net Income $ 2,781 $ 2,295 $ 7,900 $ 5,240
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Primary Earnings per
Share $ .28 $ .23 $ .79 $ .54
Average Common and Common
Equivalent Shares 9,971 9,862 9,965 9,784
Fully Diluted Earnings
per Share $ .28 $ .23 $ .79 $ .54
Average Common and Common
Equivalent Shares
assuming full dilution 9,976 9,861 9,973 9,839
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Significant Ratios
Return on Assets 1.25% 1.23% 1.24% .98%
Return on Equity 14.39% 13.11% 14.00% 10.42%
Efficiency Ratio 60.4% 64.8% 59.9% 72.5%
Net Charge Offs to Average
Loans .004% .02% .04% .12%
Allowance for Loan Losses to
Loans 1.51% 1.66%
Allowance for Loan Losses to
Nonperforming Loans 280% 244%
Triangle Bank Office Locations
Bailey
Battleboro
Benson
Carrboro
Cary (2)
Chapel Hill (2)
Clayton
Dunn
Durham
Fayetteville (2)
Fuquay-Varina
Garner
Goldsboro
Greenville (2)
Havelock
Lillington
Middlesex
Mount Olive
Nashville
New Bern
Raleigh (3)
Red Oak
Rocky Mount
Sanford (2)
Scotland Neck
Seaboard
Sharpsburg
Spring Hope
Tarboro (2)
Whiteville (2)
Wilmington
Shareholder Information
Stock Transfer Agent and Registrar:
First Citizens Bank
Stock Transfer Department
2917 Highwoods Boulevard
Raleigh, North Carolina 27604
1-800-662-7130
Stock Listing:
The common stock of Triangle Bancorp is traded in the NASDAQ National Market
System under the ticker symbol TRBC.
Market Makers:
A. G. Edwards
Dean Witter Reynolds
Herzog, Heine, Geduld, Inc.
Interstate Johnson Lane
Legg Mason
Olde Discount Corporation
Principal Financial Securities
Raymond James & Associates, Inc.
Scott & Stringfellow
Wedbush Morgan Securities, Inc.
Wheat First Butcher Singer