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Birmingham Bloomfield Bancshares, Inc. Announces results for period ended September 30, 2016

/EINPresswire.com/ -- BIRMINGHAM, MI--(Marketwired - October 18, 2016) - Birmingham Bloomfield Bancshares, Inc. (OTCBB: BBBI) ("the Company"), the holding company for Bank of Birmingham, today announced unaudited results for the quarter and nine month periods ended September 30, 2016.

The Company reported net income of $618,000 or $0.33 per common share for the third quarter of 2016 compared to net income of $512,000 or $0.27 per common share for the same period of 2015. Net income for the nine month period ended September 30, 2016 was $1,180,000 or $0.63 per common share compared to $1,388,000 or $0.74 per common share for the same period last year.

Chief Executive Officer, Rob Farr, issued the results and commented: "This was a very strong quarter for the bank and our core operations continue to improve. We reported a pre-tax, pre-provision ROA of 1.31% and experienced an increase of 28% in total assets. Loan growth remains robust, increasing $36 million over the past year and driving the expansion in our total revenue. On an adjusted basis, excluding one-time costs associated with the pending merger transaction, year to date earnings represent a record performance for the Bank."

Results of Operation

The Company reported net interest income of $2.666 million for the third quarter of 2016, a 14.8% increase compared to the same quarter of 2015 and 7.1% increase from the second quarter of 2016. Net interest margin for the quarter was 3.95% compared to 3.82% for the most recent linked quarter. The margin expansion was the result of additional fee income generated on the loan portfolio. Net interest income for the first nine months of 2016 was $7.554 million, an increase of 15.6% relative to the same period of 2015. The increase was the direct result of earning asset growth.

The Company provided $30,000 in provision expense during the quarter. Total provision expense for the year to date period ending September 30, 2016 was $845,000, compared to $525,000 for the same period of 2015. The increase is a function of charge off activity and net loan growth. A total of $833,000 in charge offs was recorded as of September 30, 2016; isolated to one problem loan that has been resolved. Total non-performing loans have significantly declined and represent 0.12% of the total portfolio at quarter end.

Total non-interest income for the third quarter of 2016 was $451,000, compared to $174,000 for the same period of 2015. The increase is a function of additional SBA loan sales during the quarter. For the year to date period ending September 30, 2016 total non-interest income was $891,000, a decline of $81,000 relative to the prior period. The decrease is directly related to the reduction in SBA loan volume.

Total non-interest expense for the third quarter of 2016 was $2.139 million, compared to $1.692 million in 2015. Year to date non-interest expense for 2016 was $5.793 million, an increase of $986,000 relative to the same period in 2015. The increase is related to the Company's growth, including costs associated with supporting additional volume and investments in new technology. Professional fees experienced a significant increase primarily due to one-time expenses connected to the merger.

Balance Sheet

Total assets as of September 30, 2016 were $301.6 million, an increase of $65.7 million from the prior year and 23.5% from December 31, 2015. Total portfolio loans reached $246.1 million at the end of the third quarter, an increase of $7.9 million on a sequential basis from June and 10.8% from December 31, 2015. The growth is a function of improved economic conditions, increased demand in the market and proactive business development efforts. The asset quality of the Company continues to improve and non-performing loans have declined $1.7 million in 2016. Total deposits as of September 30, 2016 were $274.9 million, an increase of $25.5 million from the second quarter of 2016 and 24.7% from December 31, 2015. The growth was the result of expanding existing relationships, greater visibility in our primary market area and success in executing core deposit initiatives targeting specific deposit customers. The Bank continues to be classified as well capitalized based on regulatory guidelines and is a recommended institution by Bauer Financial.

Birmingham Bloomfield Bancshares, Inc. is the holding company for Bank of Birmingham, a full-service community bank serving Oakland County. Bank of Birmingham is dedicated to providing financial services to small and medium sized businesses (their owners and employees); professionals; and individuals who work or reside in the Oakland County market area. Every Bank of Birmingham customer has a relationship manager who serves as a single point of contact empowered to provide all the bank's services. Birmingham Bloomfield Bancshares, Inc. Market Makers include Monroe Securities, Chicago; Boenning & Scattergood, Philadelphia; Stockcross Financial Services.

Forward-Looking Statements

This news release contains comments or information that constitute forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995), which involve significant risks and uncertainties. Actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include: changes in interest rates and interest-rate relationships; changes in the national and local economy; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking regulations; changes in tax laws; changes in prices, levies, and assessments; our ability to successfully integrate acquisitions into our existing operations, and the availability of new acquisitions, joint ventures and alliance opportunities; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; and other factors. The Company assumes no responsibility to update forward-looking statements.

(Unaudited Consolidated Financial Statements Follow)

 
Birmingham Bloomfield Bancshares, Inc.
Consolidated Balance Sheet (Unaudited)
           
           
  September 30,   December 31,   September 30,
  2016   2015   2015
ASSETS                
    Cash and due from banks $ 49,262,508   $ 14,232,848   $ 17,725,835
    Federal funds sold   -     -     -
  Total cash and cash equivalents   49,262,508     14,232,848     17,725,835
                 
    Securities available-for-sale   2,620,629     3,933,083     4,270,543
    Federal Home Loan Bank Stock   251,900     243,300     243,300
  Total securities   2,872,529     4,176,383     4,513,843
                 
  Portfolio loans                
    Consumer loans   3,482,311     2,355,187     2,399,146
    Mortgage loans   38,613,952     35,060,825     31,142,666
    Commercial leases   36,552,168     35,940,633     36,079,690
    Commercial loans   167,423,151     148,782,782     140,577,018
  Total loans   246,071,582     222,139,427     210,198,520
    Less: Allowance for loan loss   2,537,698     2,525,350     2,585,587
  Net loans   243,533,884     219,614,077     207,612,933
                 
    Premises and equipment, net   909,143     996,183     1,030,550
    Bank owned life insurance   2,437,426     2,389,018     2,372,527
    Deferred Tax Asset   1,126,998     1,202,501     1,272,424
    Accrued interest receivable and other assets   1,475,043     1,592,630     1,358,858
                 
  TOTAL ASSETS $ 301,617,531   $ 244,203,640   $ 235,886,970
                 
                 
                 
LIABILITIES                
  Deposits                
    Noninterest-bearing $ 65,153,314   $ 57,526,790   $ 54,407,723
    Interest-bearing   209,716,133     162,960,444     157,608,784
   Total deposits   274,869,447     220,487,234     212,016,507
                 
    Other Borrowings   5,684,678     4,621,000     -
    Accrued interest payable, taxes and other liabilities   2,338,650     1,718,161     2,411,731
  Total liabilities   282,892,775     226,826,395     214,428,237
                 
SHAREHOLDERS' EQUITY                
    Senior preferred stock, series D   -     -     4,621,000
    Common Stock, no par value   17,541,404     17,412,285     17,412,285
      Authorized -- 9,000,000 shares, Issued and outstanding -- 1,887,610                
      1,872,632 and 1,872,632 shares respectively                
    Accumulated other comprehensive income   29,913     23,808     37,169
    Additional paid in capital -- share based payments   546,404     514,454     503,804
    Accumulated deficit   607,035     (573,302)     (1,115,525)
  Total shareholders' equity   18,724,756     17,377,245     21,458,733
                 
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 301,617,531   $ 244,203,640   $ 235,886,970
                 
Book value per share $ 9.92   $ 9.28   $ 8.99
                 
 
Birmingham Bloomfield Bancshares, Inc.
Consolidated Statement of Income (Unaudited)
                 
    For the three months ended   For the nine months ended
    September 30,   September 30,
    2016   2015   2016   2015
Interest Income                        
    Interest and fees on loans                        
      Commercial loans   $ 2,055,590   $ 1,793,458   $ 5,877,868   $ 5,231,342
      Commercial leases     456,645     406,816     1,344,013     1,084,584
      Consumer loans     43,601     32,124     114,407     87,513
      Mortgage loans     238,091     191,963     720,573     490,475
      Home Equity loans     154,335     110,037     446,772     325,112
      Late charges and fees     73,044     76,762     99,588     109,935
  Total loan interest and fee income     3,021,306     2,611,160     8,603,221     7,328,961
                         
     Interest bearing deposits     29,628     10,363     85,779     33,858
     Federal Funds Sold     -     -     -     62
                         
    Interest on investment securities                        
      Taxable     14,109     19,913     47,385     65,819
      Tax-exempt     -     -     -     -
  Total investment income     14,109     19,913     47,385     65,819
                         
  Total interest income     3,065,043     2,641,436     8,736,385     7,428,700
                         
Interest Expense                        
    Interest on deposits     343,646     318,863     1,036,794     896,362
    Interest on borrowed funds     55,197     -     145,655     1
  Total interest expense     398,843     318,863     1,182,449     896,363
                         
  Net Interest Income     2,666,200     2,322,573     7,553,936     6,532,337
    Provision for loan losses     30,000     -     845,000     525,000
  Net Interest Income After Provision for Loan Losses     2,636,200     2,322,573     6,708,936     6,007,337
                         
Non-interest Income                        
    Service charge income     28,855     25,475     79,240     76,761
    Mortgage banking activities     45,216     41,443     97,546     94,791
    SBA loan sales     343,927     76,036     614,309     703,542
    Other income     33,342     31,305     100,351     96,988
  Total non-interest income     451,340     174,259     891,446     972,082
                         
Non-interest Expense                        
    Salaries and employee benefits     1,046,171     905,510     3,079,910     2,671,201
    Occupancy expense     124,643     126,832     386,458     400,385
    Equipment expense     46,425     48,324     126,090     143,254
    Advertising     56,085     45,772     203,523     179,965
    Data Processing     100,356     95,677     302,859     245,285
    Professional fees     461,256     204,721     944,326     476,365
    Loan origination expense     103,497     82,519     209,989     178,761
    Regulatory Assessments     59,735     62,151     176,155     147,380
    Other expense     140,544     121,003     364,001     364,633
  Total non-interest expense     2,138,712     1,692,509     5,793,311     4,807,229
                         
  Net Income Before Income Taxes     948,828     804,323     1,807,071     2,172,191
    Income tax expense     330,836     280,438     626,735     749,152
  Net Income     617,992     523,885     1,180,336     1,423,039
    Dividend on preferred stock     -     11,553     -     34,658
  Net Income applicable to common shareholders   $ 617,992   $ 512,332   $ 1,180,336   $ 1,388,381
                         
Income per share - basic & diluted   $ 0.33   $ 0.27   $ 0.63   $ 0.74
                         
 
Birmingham Bloomfield Bancshares, Inc.
Financial Summary and Selected Ratios (Unaudited)
(Dollars in thousands except per share data)
                   
      Year to Date
      September 30,   Change
      2016   2015   Amount   Percentage
INCOME STATEMENT                              
    Interest Income   $ 8,736     $ 7,429     $ 1,308     17.6 %
    Interest Expense     1,182       896       286     31.9 %
  Net Interest Income     7,554       6,532       1,022     15.6 %
    Provision for loan loss     845       525       320     61.0 %
    Non-interest income     891       972       (81 )   -8.3 %
    Non-interest expense     5,793       4,807       986     20.5 %
  Net Income before Income Taxes     1,807       2,172       (365 )   -16.8 %
    Income tax expense     627       749       (122 )   -16.3 %
  Net Income     1,180       1,423       (243 )   -17.1 %
    Dividend on preferred stock     -       35       (35 )   -100.0 %
  Net Income - common shareholders   $ 1,180     $ 1,388     $ (208 )   -15.0 %
                                 
  Income per share - basic & diluted   $ 0.63     $ 0.74     $ (0.12 )   -15.7 %
                                 
BALANCE SHEET DATA                              
  Total assets     301,618       235,887       65,731     27.9 %
  Average Assets     271,215       224,195       47,020     21.0 %
  Total loans     246,072       210,199       35,873     17.1 %
  Allowance for loan loss (ALLL)     2,538       2,586       (48 )   -1.9 %
  Total deposits     274,869       212,017       62,853     29.6 %
  Other borrowings     5,685       -       5,685     0.0 %
  Shareholders' equity     18,725       21,459       (2,734 )   -12.7 %
                                 
ASSET QUALITY                              
  Other real estate owned (OREO)     -       -       -     0.0 %
  Net charge-offs     833       -       833     0.0 %
  Non-accrual loans     304       2,237       (1,933 )   -86.4 %
(2) Non-performing assets (NPA)     304       2,237       (1,933 )   -86.4 %
  Non-accrual loans / total loans     0.12 %     1.06 %     -0.94 %   -88.4 %
  Allowance for loan loss / total loans     1.03 %     1.23 %     -0.20 %   -16.2 %
                                 
PERFORMANCE MEASUREMENTS                              
  Net interest margin (tax equivalent)     3.87 %     4.07 %     -0.20 %   -4.9 %
(1) Return on average assets (annualized)     0.58 %     0.85 %     -0.27 %   -31.5 %
(3) Return on average assets (annualized)     1.31 %     1.61 %     -0.30 %   -18.8 %
(1) Return on average common equity (annualized)     8.77 %     11.86 %     -3.09 %   -26.0 %
(3) Return on average common equity (annualized)     19.71 %     22.47 %     -2.76 %   -12.3 %
  Efficiency ratio     68.6 %     64.1 %     4.54 %   7.1 %
  Total loans / Total deposits     89.5 %     99.1 %     -9.62 %   -9.7 %
  Equity / Assets     6.21 %     9.10 %     -2.89 %   -31.8 %
  Tangible common equity / Total assets     6.21 %     7.14 %     -0.93 %   -13.0 %
                                 
  Book value per share   $ 9.92     $ 8.99     $ 0.93     10.3 %
  Stock price   $ 16.26     $ 8.50     $ 7.76     91.3 %
  Stock price / book value (%)     163.9 %     94.5 %     69.38 %   73.4 %
  Income per share - basic & diluted   $ 0.63     $ 0.74     $ (0.12 )   -15.7 %
  Income per share - basic & diluted (LTM)   $ 0.92     $ 0.97     $ (0.05 )   -5.2 %
  Price to earnings ratio (P/E) (year to date)     19.4x       8.5x       10.9x     127.2 %
  Shares outstanding     1,887,610       1,872,632       14,978     0.8 %
  Average shares outstanding     1,882,828       1,866,593       16,235     0.9 %
                                 
(1) Amount is computed on net income before preferred dividends.
(2) Non-performing assets includes non-accrual loans and other real estate owned.
(3) Amount is computed on pre-tax, pre-provision earnings before preferred dividends
 
Birmingham Bloomfield Bancshares, Inc.
Financial Summary and Selected Ratios (Unaudited)
(Dollars in thousands except per share data)
 
      Quarter Ended
      September 30,   June 30,   March 31,   December 31,   September 30,
      2016   2016   2016   2015   2015
INCOME STATEMENT                                        
    Interest Income   $ 3,065     $ 2,879     $ 2,792     $ 2,712     $ 2,641  
    Interest Expense     399       390       394       334       319  
  Net Interest Income     2,666       2,489       2,399       2,378       2,323  
    Provision for loan loss     30       405       410       81       -  
    Non-interest income     451       218       222       333       174  
    Non-interest expense     2,139       1,921       1,734       1,806       1,693  
  Net Income before Income Taxes     949       381       477       824       804  
    Income tax expense     331       132       164       272       280  
  Net Income     618       249       313       553       524  
    Dividend on preferred stock     -       -       -       10       12  
  Net Income applicable to common shareholders   $ 618     $ 249     $ 313     $ 542     $ 512  
                                           
  Income per share - basic & diluted   $ 0.33     $ 0.13     $ 0.17     $ 0.29     $ 0.27  
                                           
BALANCE SHEET DATA                                        
  Total assets     301,618       274,650       273,894       244,204       235,887  
  Average Assets     279,597       272,776       261,080       246,503       233,756  
  Total loans     246,072       238,209       227,052       222,139       210,199  
  Allowance for loan loss (ALLL)     2,538       2,788       2,935       2,525       2,586  
  Total deposits     274,869       249,339       249,830       220,487       212,017  
  Other borrowings     5,685       5,531       4,526       4,621       -  
  Shareholders' equity     18,725       18,099       17,744       17,377       21,459  
                                           
ASSET QUALITY                                        
  Other real estate owned (OREO)     -       -       -       -       -  
  Net charge-offs     280       553       -       141       -  
  Non-accrual loans     304       968       2,083       2,083       2,237  
(2) Non-performing assets (NPA)     304       968       2,083       2,083       2,237  
  Non-accrual loans / total loans     0.12 %     0.41 %     0.92 %     0.94 %     1.06 %
  Allowance for loan loss / total loans     1.03 %     1.17 %     1.29 %     1.14 %     1.23 %
                                           
PERFORMANCE MEASUREMENTS                                        
  Net interest margin (tax equivalent)     3.95 %     3.82 %     3.85 %     3.99 %     4.12 %
(1) Return on average assets (annualized)     0.88 %     0.37 %     0.48 %     0.89 %     0.89 %
(3) Return on average assets (annualized)     1.39 %     1.16 %     1.37 %     1.46 %     1.37 %
(1) Return on average common equity (annualized)     13.36 %     5.59 %     7.16 %     12.79 %     12.52 %
(3) Return on average common equity (annualized)     21.16 %     17.65 %     20.26 %     20.96 %     19.22 %
  Efficiency ratio     68.6 %     71.0 %     66.2 %     66.6 %     67.8 %
  Total loans / Total deposits     89.5 %     95.5 %     90.9 %     100.7 %     99.1 %
  Equity / Assets     6.21 %     6.59 %     6.48 %     7.12 %     9.10 %
  Tangible common equity / Total assets     6.21 %     6.59 %     6.48 %     7.12 %     7.14 %
                                           
  Book value per share   $ 9.92     $ 9.59     $ 9.46     $ 9.28     $ 8.99  
  Stock price   $ 16.26     $ 9.15     $ 8.79     $ 8.65     $ 8.50  
  Stock price / book value (%)     163.9 %     95.4 %     93.0 %     93.2 %     94.5 %
  Income per share - basic & diluted   $ 0.33     $ 0.13     $ 0.17     $ 0.29     $ 0.27  
  Shares outstanding     1,887,610       1,887,610       1,876,610       1,872,632       1,872,632  
  Average shares outstanding     1,887,610       1,885,434       1,875,386       1,872,632       1,872,632  
                                           
(1) Amount is computed on net income before preferred dividends.  
(2) Non-performing assets includes non-accrual loans and other real estate owned.  
(3) Amount is computed on pre-tax, pre-provision earnings before preferred dividends  

Contact:
Robert E. Farr
Chief Executive Officer
Birmingham Bloomfield Bancshares, Inc.
248-283-6430

Distribution channels: Banking, Finance & Investment