BERLIN, MD / ACCESSWIRE / February 11, 2019 / Calvin B. Taylor Bankshares, Inc. (the "Company") (OTCQX: TYCB), parent company of Calvin B. Taylor Bank, today reported unaudited financial results for the year ended December 31, 2018. Selected highlights of the company's financial performance are included below.
| At Year End | December 31, 2018 | December 31, 2017 | % Change | |||||||||
| Assets | $ | 531,909,554 | $ | 521,968,436 | 1.90 | % | ||||||
| Loans, net | $ | 327,242,654 | $ | 294,360,392 | 11.17 | % | ||||||
| Deposits | $ | 446,132,305 | $ | 439,423,322 | 1.53 | % | ||||||
| Capital | $ | 84,788,815 | $ | 81,922,879 | 3.50 | % | ||||||
| Book value per share | $ | 30.40 | $ | 29.11 | 4.43 | % | ||||||
| Loans to deposits | 73.35 | % | 66.99 | % | ||||||||
| Capital to assets | 15.94 | % | 15.69 | % | ||||||||
| For the Year Ended | December 31, 2018 | December 31, 2017 | % Change | |||||||||
| Average assets | $ | 527,635,610 | $ | 503,651,874 | 4.76 | % | ||||||
| Average loans, net | $ | 309,896,497 | $ | 282,318,587 | 9.77 | % | ||||||
| Average deposits | $ | 442,314,575 | $ | 417,627,885 | 5.91 | % | ||||||
| Average capital | $ | 84,584,990 | $ | 81,967,722 | 3.19 | % | ||||||
| Average loans to average deposits | 70.06 | % | 67.60 | % | ||||||||
| Average capital to average assets | 16.03 | % | 16.27 | % | ||||||||
| Net interest income | $ | 18,143,800 | $ | 16,174,987 | 12.17 | % | ||||||
| Income before taxes | $ | 9,653,002 | $ | 8,396,532 | 14.96 | % | ||||||
| Net income | $ | 7,402,096 | $ | 5,504,815 | 34.47 | % | ||||||
| Net income per share | $ | 2.64 | $ | 1.95 | 35.38 | % | ||||||
| Dividend paid per share | $ | 1.24 | $ | 0.98 | 26.53 | % | ||||||
| Dividend payout ratio | 46.81 | % | 50.10 | % | ||||||||
| Stock Repurchased | ||||||||||||
| Number of shares | 25,314 | 69,318 | -63.48 | % | ||||||||
| Repurchase amount | $ | 757,395 | $ | 1,860,935 | -59.30 | % | ||||||
| Average price per share | $ | 29.92 | $ | 26.85 | 11.45 | % | ||||||
| Ratios | ||||||||||||
| Return on average assets | 1.40 | % | 1.09 | % | ||||||||
| Return on average equity | 8.75 | % | 6.72 | % | ||||||||
| Efficiency ratio | 54.07 | % | 54.69 | % | ||||||||
Total assets of the Company grew $10.0 million or 1.9% since December 31, 2017 and totaled $532.0 million as of December 31, 2018. The increase was primarily the result of continued organic growth in deposits which increased to $446.1 million as of December 31, 2018, an increase of $6.7 million or 1.5% since the previous year end. Total assets and deposits decreased in the 4th quarter of 2018 due to seasonal deposit outflows which resulted in a decrease of $29.1 million or 5.2% in total assets and a $28.7 million or 6.0% decrease in deposits since September 30, 2018. The loan portfolio increased $32.9 million or 11.2% since the previous year end while increasing $9.0 million or 2.8% since the end of the previous quarter. Loan growth during 2018 resulted in an increase in the loans to deposit ratio from 67.0% as of December 31, 2017 to 73.4% as of December 31, 2018. Funding for loan growth during 2018 was primarily provided by a decrease in investment securities which declined $16.8 million or 17.5% since December 31, 2017.
Average assets for the year ended December 31, 2018 increased $24.0 million or 4.8% as compared to the previous year. The increase in average assets is the result of continued organic growth in average deposits which increased to $442.3 million for 2018, an increase of $24.7 million or 5.9% compared to the prior year. Significant fluctuations in deposits can occur from period to period due to customer activity, and therefore a comparison of average deposits provides a better measurement of overall deposit activity. At December 31, 2017, several large temporary deposits were made by certain customers and resulted in year-over-year deposit growth rates to be much lower than average deposit growth rates for 2018. Average loans increased $27.6 million or 9.8% which exceeded the growth rate of average deposits and as a result the average loans to average deposits ratio increased from 67.6% in 2017 to 70.1% in 2018.
Net income for the year ended December 31, 2018 increased 34.5% compared to the previous year which outpaced growth in average assets and average equity during the same period. This resulted in an increase in Return on Average Assets from 1.09% to 1.40% and an increase in Return on Equity from 6.72% to 8.75% compared to the previous year. Net income per share increased 35.4% to $2.64 per share for the year ended December 31, 2018 as compared to $1.95 per share in the prior year. In addition to the regular annual dividend, the Company paid a special dividend of $0.25 per share in April 2018 which resulted in a dividend payout ratio of 46.8% for the current year.
Income before taxes for the year ended December 31, 2018 was $9.7 million, an increase of $1.3 million or 15.0% compared to the previous year. The primary contributor to the increase was a $2.0 million or 12.2% increase in net interest income resulting from a combination of organic loan growth, higher investment yields and increases in the Federal Funds interest rate. In addition, non-interest income for 2018 increased $238 thousand or 10.0% primarily as a result of a $389 thousand gain recognized upon the sale of an investment security in the 1st quarter of 2018. Partially offsetting the aforementioned increases in income was a $940 thousand or 9.3% increase in non-interest expense. During the 1st quarter of 2018 the Company recorded a $411 thousand loss related to an unauthorized wire transfer by a bank employee. The unauthorized wire transfer loss was previously disclosed as a subsequent event in the Company's 2017 financial statements and further discussed in Company's 1st quarter 2018 earnings release. The remaining $529 thousand increase in non-interest expense is primarily attributable to the Company's expansion into the Eastern Shore of Virginia market with a branch location in Chincoteague, Virginia and a Loan Production Office in Onley, Virginia. The combined growth in net interest income and non-interest income exceeded the increase in non-interest expenses which resulted in a decrease in the Company's efficiency ratio to 54.1% for the year ended December 31, 2018 as compared to 54.7% in the prior year.
Net income for year ended December 31, 2018 was $7.4 million, an increase of $1.9 million or 34.5% compared to the prior year. The increase in net income was a result of the $1.3 million or 15.0% increase in income before taxes as discussed above and a $641 thousand or 22.1% reduction in income tax expense. In December 2017, the Tax Cut and Jobs Act was enacted, which decreased the Company's federal income tax rate from 34% to 21% beginning January 1, 2018. As a result, the Company's effective income tax rate has dropped from 34.4% in 2017 to 23.3% for 2018.
About Calvin B. Taylor Banking Company
Calvin B. Taylor Banking Company, the bank subsidiary of Calvin B. Taylor Bankshares, Inc. (OTCQX: TYCB), founded in 1890, offers a wide range of loan, deposit, and ancillary banking services through both physical and digital delivery channels. The Company has 11 banking locations within the eastern coastal area of the Delmarva Peninsula including Worcester County, Maryland, Sussex County, Delaware and Accomack County, Virginia. There is also a Loan Production Office located in Onley, Virginia.
Contact
M. Dean Lewis, Vice President and Chief Financial Officer
410-641-1700, taylorbank.com
SOURCE: Calvin B. Taylor Bankshares, Inc.
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