KS Bancorp, Inc. (KSBI) Announces Third Quarter 2012 Financial Results

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KS Bancorp, Inc. (KSBI) Announces Third Quarter 2012 Financial Results

SMITHFIELD, N.C.--(BUSINESS WIRE)-- KS Bancorp, Inc. (the "Company") (OTCBB: KSBI), parent company of KS Bank, Inc. (the "Bank"), announced unaudited net income available to common shareholders of $91,000, or $.07 per diluted shared, for the three months ended September 30, 2012, compared to a net loss of ($454,000), or ($.35) per diluted share, for the three months ended September 30, 2011.

The Company reported net income available to common shareholders of $405,000, or $.31 per diluted shared, for the nine months ended September 30, 2012, compared to a net loss attributable to common shareholders of ($34,000), or ($.03) per diluted share, for the nine months ended September 30, 2011.


For the nine months ended September 30, 2012, net interest income was $7.3 million, compared to $7.7 million for the nine months ended September 30, 2011. Noninterest income increased to $1.9 million for the period ended September 30, 2012, compared to $1.0 million for the same period ended September 30, 2011. The increase in noninterest income is primarily attributable to a $433,000 gain on the sale of investments, compared to a loss of ($78,000) for the nine months ended September 30, 2011. Additionally, fees from presold mortgages increased $393,000 during the nine months ended September 30, 2012. Noninterest expenses increased $769,000 to $8.5 million for the nine months ended September 30, 2012, compared to $7.8 million at September 30, 2011. The increase in expenses is primarily due to the costs associated with foreclosed real estate.

The Company's unaudited consolidated total assets decreased $11.3 million to $311.6 million at September 30, 2012, compared to $322.9 million at December 31, 2011. The decrease in the balance sheet is primarily due to a reduction in borrowings and brokered deposits. Total borrowings decreased $6.7 million from $50.1 million at December 31, 2011, to $43.4 million at September 30, 2012. Total deposits have decreased $6.0 million to $240.5 million at September 30, 2012, compared to $246.5 million at December 31, 2011. The decrease in deposits includes an $8.1 million decrease in brokered deposits. Net loan balances decreased $3.4 million with a balance of $192.0 million at September 30, 2012, compared to $195.4 million at December 31, 2011. The Company's investment securities decreased $4.8 million to $86.5 million at September 30, 2012, compared to $91.3 million at December 31, 2011. Total stockholders' equity increased $855,000 from $24.3 million at December 31, 2011, to $25.2 million at September 30, 2012.

Nonperforming assets, which includes nonaccrual loans and other real estate owned (OREO), decreased $5.1 million from $19.9 million at December 31, 2011, to $14.8 million at September 30, 2012. The nonperforming assets consist of $7.4 million in OREO and $7.4 million in nonaccrual loans. Net charge offs for the nine months ended September 30, 2012 were $218,000, compared to net charge offs of $1.0 million for the nine months ended September 30, 2011. The allowance for loan losses at September 30, 2012 totaled $3.4 million, or 1.73% of all outstanding loans.

The Company also announced today that its Board of Directors voted not to declare a dividend for the third quarter of 2012. The continued suspension of the quarterly dividend is to further the Company's efforts to preserve capital. The Company's profitability, capital levels and asset quality are factors that are considered in determining whether to resume dividend payments.

KS Bank continues to be well-capitalized according to federal regulatory standards with total risk based capital of 16.51%, tier 1 risk- based capital of 15.26%, and a leverage ratio of 9.29% at September 30, 2012. The minimum levels to be considered well capitalized for each of these ratios are 10%, 6%, and 5%, respectively.

KS Bancorp, Inc. is a Smithfield, North Carolina-based single bank holding company. KS Bank, Inc., a state-chartered savings bank, is KS Bancorp's sole subsidiary. The Bank is a full service community bank serving the citizens of eastern North Carolina since 1924 and offers a variety of financial products and services including a securities brokerage service through an affiliation with a registered broker/dealer. There are nine full service branches located in Kenly, Selma, Clayton, Garner, Goldsboro, Wilson, Wendell, Smithfield, and Four Oaks, North Carolina plus a mortgage servicing location in Greenville, NC. For more information, visit www.ksbankinc.com.

This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company.These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like "expect," "anticipate," "estimate" and "believe," variations of these words and other similar expressions.Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements.The Company undertakes no obligation to update any forward-looking statements.

KS Bancorp, Inc. and Subsidiary
Consolidated Statements of Financial Condition
     
 
September 30, 2012December 31,
(unaudited)2011*
 
(Dollars in thousands)
ASSETS
 
Cash and due from banks:
Interest-earning$5,880$1,182
Noninterest-earning1,3253,929
Time Deposit100100
Investment securities available for sale, at fair value86,58091,375
Federal Home Loan Bank stock, at cost2,0592,596
Presold mortgages in process of settlement1,119809
 
Loans195,325198,847
Less Allowance for loan losses (3,384) (3,477)
Net loans191,941195,370
 
Accrued interest receivable1,2031,316
Foreclosed assets, net7,39811,696
Property and equipment, net8,7348,825
Other assets 5,311  5,734 
 
Total assets$311,650 $322,932 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
Liabilities
Deposits$240,468$246,464
Short-term borrowings2,1566,933
Long-term borrowings41,24843,248
Accrued interest payable237275
Accounts payable and accrued expenses 2,369  1,696 
 
Total liabilities 286,478  298,616 
 
Stockholder's Equity:
Cumulative perpetual preferred stock (Series A), no par value
4,000 shares authorized, issued and outstanding$3,902$3,866
Cumulative perpetual preferred stock (Series B), no par value
200 shares authorized, issued and outstanding214219
Common stock, no par value, authorized 20,000,000 shares;
1,309,501 shares issued and outstanding in 2010 and 20091,6071,607
Retained earnings, substantially restricted18,26417,859
Accumulated other comprehensive income 1,185  765 
 
Total stockholders' equity 25,172  24,316 
 
Total liabilities and stockholders' equity$311,650 $322,932 
 
* Derived from audited financial statements
        
KS Bancorp, Inc and Subsidiary
Consolidated Statements of Income (Loss) (Unaudited)
 
 
Three Months EndedNine Months Ended
Sept 30,Sept 30,

2012

2011

2012

2011

( In thousands, except per share data)
Interest and dividend income:
Loans$ 2,803$ 2,988$ 8,525$ 9,187
Investment securities
Taxable3573961,0881,082
Tax-exempt1593066691,142
Dividends862618
Interest-bearing deposits  4   2   7   4 
Total interest and dividend income  3,331   3,698   10,315   11,433 
 
Interest expense:
Deposits5117001,6652,218
Borrowings  421   484   1,302   1,493 
Total interest expense  932   1,184   2,967   3,711 
 
Net interest income2,3992,5147,3487,722
 
Provision for loan losses  (75)  786   125   1,333 
 
Net interest income after
provision for loan losses  2,474   1,728   7,223   6,389 
 
Noninterest income:
Service charges on deposit accounts283299831886
Fees from presold mortgages2332646572
Gain (Loss) on sale of investments8(59)433(78)
Other income  52   34   130   115 
Total noninterest income  576   300   1,859   995 
 
Noninterest expenses:
Compensation and benefits1,5311,3654,4724,249
Occupancy and equipment282422774750
Data processing & outside service fees19320601601
Advertising13213559
Net foreclosed real estate4084851,091615
Other  484   461   1,561   1,491 
Total noninterest expenses  2,911   2,774   8,534   7,765 
 
Income (loss) before income taxes139(746)548(381)
 
Income tax expense (benefit)  (17)  (356 Read Full Story

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