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Third Century Bancorp Releases Earnings for Quarter Ended June 30, 2018

July 31, 2018

FRANKLIN, Ind.--(BUSINESS WIRE)--Jul 31, 2018--(OTCPINK: TDCB) - Third Century Bancorp (“Company”), the holding company for Mutual Savings Bank (“Bank”) announced it had net income of $251,000 for the quarter ended June 30, 2018, or $0.21 per basic and diluted share, compared to net income of $172,000 for the quarter ended June 30, 2017, or $0.14 per basic and diluted share. The improvement in net income was primarily driven by an increase of $130,000 in net interest income. For the six months ended June 30, 2018, the Company recorded net income of $449,000, or $0.38 per basic and diluted share, compared to net income of $339,000 for the six months ended June 30, 2017, or $0.28 per basic and diluted share. The improvement in net income for the 2018 six-month period was primarily due to a $203,000 increase in net interest income.

For the quarter ended June 30, 2018, net income increased $79,000, or 45.93%, to $251,000 as compared to $172,000 for the same period in the prior year. The increase in net income for the three-month period ended June 30, 2018 was primarily a result of a $130,000 increase in net interest income, which was achieved through an increase in interest income of $199,000 partially offset by a $69,000 increase in interest expense. The increase in interest income was due to an increase in the average yield on interest-earning assets, along with higher average loan balances. The increase in interest expense was primarily due to higher average balances of interest-bearing liabilities and a higher average rate paid on interest-bearing liabilities.

The increase in net interest income for the quarter ended June 30, 2018 was partially offset by a $27,000 increase in provision for loan losses compared to the same period in 2017. The increase in provision for loan losses was primarily driven by growth of the loan portfolio as well as credit quality factors. Changes to the allowance included net loan recoveries of $3,000 during the quarter ended June 30, 2018 compared to net loan charge offs of $11,000 for the same period in 2017.

The increase in net income for the three-month period ended June 30, 2018 was also impacted by a $134,000 increase in noninterest income, a $167,000 increase in noninterest expense and a $9,000 decrease in income tax expense. The increase in noninterest income was due to increases in gains on sales of loans, trust income, and deposit fee and service charge income for the three-month period ended June 30, 2018 as compared to the prior year period. The increase in noninterest expense for the quarter ended June 30, 2018 compared to the same period in the prior year was primarily due to increases in wages and benefits, advertising expenses, and data processing expenses. This was offset by decreases in tax expense from lower effective tax rates in 2018.

For the six-month period ended June 30, 2018, net income increased $110,000 or 32.45% to $449,000 from $339,000 for the six-month period ended June 30, 2017. The increase in net income for the six-month period ended June 30, 2018 was primarily due to an increase in net interest income of $203,000 or 8.52% to $2,585,000 from $2,382,000 for the six-month period ended June 30, 2017. The increase in net interest income for the six-month-period ended June 30, 2018 was due to a $342,000 or 12.94% increase in interest income partially offset by a $139,000 or 53.46% increase in interest expense. The increase in interest income was due to an increase in the average yield on interest-earning assets, along with higher average loan balances. The increase in interest expense was primarily due to higher average balances of interest-bearing liabilities and a higher average rate paid on interest-bearing liabilities.

The increase in net interest income for the six-months ended June 30, 2018 was partially offset by a $58,000 increase in provision for loan losses compared to the same period in 2017. The increase in provision for loan losses was primarily driven by growth in the loan portfolio and credit quality factors. Changes to the allowance included net loan charge offs of $12,000 during the six months ended June 30, 2018 compared to net loan charge offs of $258,000 for the same period in 2017.

The increase in net income for the six-month period ended June 30, 2018 was also impacted by a $209,000 increase in noninterest income, a $271,000 increase in noninterest expense and a $27,000 decrease in income tax expense. The increase in noninterest income was due to increases in gains on sales of loans, trust income, and deposit fee and service charge income for the six-month period ended June 30, 2018 as compared to the same period in the prior year. The increase in noninterest expense for the six months ended June 30, 2018 compared to the same period in the prior year was primarily due to increases in wages and benefits, advertising expenses, and data processing expenses.

Total assets increased $4.3 million to $155.3 million at June 30, 2018 from $151.0 million at December 31, 2017, an increase of 2.8%. The increase was primarily due to a $7.9 million or 6.6% increase in loans, primarily funded by a $6.6 million or 5.9% increase in total deposits, less a decrease of $3.0 million or 13.9% in FHLB advances. At June 30, 2018, the weighted average rate of all Federal Home Loan Bank advances was 1.45% compared to 1.44% at December 31, 2017, and the weighted average maturity remained at 4.3 years at June 30, 2018 compared to 4.3 years at December 31, 2017.

The allowance for loan losses increased by $109,000 or 9.9% to $1,211,000 at June 30, 2018 compared to $1,102,000 at December 31, 2017. The increase was the result of provision for loan losses of $121,000 during the six months ended June 30, 2018 and was partially offset by net loan charge offs of $12,000. The allowance for loan losses totaled 24,220.00% of non-performing loans and 0.94% of total loans as of June 30, 2018. Nonperforming loans totaled $5,000 or 0.01% of total loans as of June 30, 2018.

Stockholders’ equity increased to $16.2 million at June 30, 2018 from $15.9 million at December 31, 2017. Stockholders’ equity increased by $308,000 during the six-month period ended June 30, 2018 due to net income of $449,000, which was partially offset by cash dividends paid of $141,000. Equity as a percentage of assets decreased to 10.43% at June 30, 2018 compared to 10.52% at December 31, 2017.

Founded in 1890, Mutual Savings Bank is a full-service financial institution based in Johnson County, Indiana. In addition to its main office at 80 East Jefferson Street, Franklin, Indiana, the bank operates branches in Franklin at 1124 North Main Street and the Otterbein Franklin SeniorLife Community, as well as in Nineveh and Trafalgar, Indiana.

This press release contains certain forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, legislative and regulatory changes that adversely affect the business of the Company and the Bank, and changes in the securities markets. Except as required by law, the Company does not undertake any obligation to update any forward-looking statements to reflect changes in belief, expectations or events.

View source version on businesswire.com:https://www.businesswire.com/news/home/20180731005566/en/

CONTACT: Third Century Bancorp

David A. Coffey, President and CEO

Ryan Cook, Senior Vice President and CFO

Tel. 317-736-7151

Fax 317-736-1726

KEYWORD: UNITED STATES NORTH AMERICA INDIANA

INDUSTRY KEYWORD: PROFESSIONAL SERVICES BANKING FINANCE

SOURCE: Third Century Bancorp

Copyright Business Wire 2018.

PUB: 07/31/2018 09:12 AM/DISC: 07/31/2018 09:12 AM

http://www.businesswire.com/news/home/20180731005566/en

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