Atlantic Coast Financial Corporation (Atlantic Coast or the
Company, NASDAQ: ACFC):
- Portfolio loans increased $118
million since December 2016.
- Deposits increased $47 million
during the last 12 months.
- Nonperforming assets declined 27% to
$9.5 million year over year.
- Entered into an Agreement and Plan
of Merger with Ameris Bancorp on November 16, 2017.
Atlantic Coast Financial Corporation (Atlantic Coast or the
Company, NASDAQ: ACFC), the holding company for Atlantic Coast Bank
(the Bank), today reported a loss per diluted share of $0.04 and
earnings per diluted share of $0.21 for the 3 and 12 months ended
December 31, 2017, respectively, compared with earnings of $0.13
and $0.42 for the 3 and 12 months ended December 31, 2016,
respectively. The results for the 3 and 12 months ended December
31, 2017, included a charge of $1.6 million, or $0.11 per diluted
share, related to a reduction in the valuation of the Company's net
deferred tax assets caused by the recently enacted tax legislation,
which reduces the future statutory corporate income tax rate, and
$0.4 million, or $0.03 per diluted share, of merger-related
costs.
Commenting on the Company's results, John K. Stephens, Jr.,
President and Chief Executive Officer, said, "Aside from the impact
of the new tax legislation on our deferred tax assets, which was
anticipated as Congress began to consider reduced corporate income
tax rates last fall, the fourth quarter demonstrated continued
strength throughout our franchise. During the past year, total
loans increased 16% while deposits increased 8%, with both
reflecting the success of our strategies to increase our presence
and visibility across our markets. Meanwhile, credit quality
continued to improve, as indicated by an ongoing decline in
nonperforming assets – both in total and relative to total assets.
With this progress, we proudly look back on the Company's
performance and accomplishments in 2017."
Separately, Stephens noted the Company's recent announcement to
be acquired by Ameris Bancorp in a transaction that is expected to
be completed in the second quarter of 2018, subject to regulatory
and stockholder approvals, along with other customary conditions.
"We are excited about the prospects of joining forces with Ameris
and together becoming the largest community bank in the
Jacksonville market. We believe there is a good cultural fit
between our two banks, which means that our customers will continue
to see a strong commitment to high-touch service while benefiting
directly from the additional resources and capabilities offered by
Ameris."
Other significant highlights of the fourth quarter of 2017 and
the full year included:
- Net interest income was $7.2 million
and $27.0 million for the 3 and 12 months ended December 31, 2017,
respectively, compared with $7.1 million and $26.5 million for the
3 and 12 months ended December 31, 2016, respectively. Net interest
margin was 3.24% and 3.20% for the 3 and 12 months ended December
31, 2017, respectively, compared with 3.30% and 3.12% for the 3 and
12 months ended December 31, 2016, respectively.
- Total loans (including portfolio loans,
loans held-for-sale, and warehouse loans held-for-investment)
increased 16% to $842.8 million at December 31, 2017, from $727.0
million at December 31, 2016. The Company's loan growth since
December 31, 2016, was driven primarily by increased commercial
real estate lending in all of its markets. This growth was
supplemented by strategic loan purchases, somewhat offset by
mortgage loan sales as part of the Company's interest rate risk and
balance sheet management strategies and decreases in warehouse
loans held-for-investment.
- Deposits increased 8% to $675.8 million
at December 31, 2017, from $628.4 million at December 31, 2016.
Deposits, excluding brokered certificates of deposit, increased 15%
to $639.8 million at December 31, 2017, from $558.0 million at
December 31, 2016. Wholesale funding, which includes brokered
certificates of deposit and Federal Home Loan Bank advances,
decreased 4% to $249.5 million at December 31, 2017, from $259.2
million at December 31, 2016. The increase in non-brokered deposits
and resulting reduced reliance on wholesale funding was driven
primarily by the Company's commercial deposit strategies put in
place during 2016.
- Total assets increased to $983.3
million at December 31, 2017, from $907.5 million at December 31,
2016, primarily due to increases in portfolio loans and warehouse
loans held-for-investment, which were partially offset by a
decrease in cash and cash equivalents, investment securities and
loans held-for-sale.
- Nonperforming assets, as a percentage
of total assets, declined to 0.97% at December 31, 2017, from 1.44%
at December 31, 2016. Due to the Company's generally stable credit
quality during 2016 and continuing throughout 2017, reflecting an
overall slowing pace of loan reclassifications to nonperforming,
the Company’s loan loss provision remained at a low level for both
the 3 and 12 months ended December 31, 2017, while
maintaining, in management's view, a stable ratio of allowance for
portfolio loan losses to total portfolio loans.
- The Bank's ratios of total risk-based
capital to risk-weighted assets and Tier 1 (core) capital to
adjusted total assets were 12.51% and 9.66%, respectively, at
December 31, 2017, and each continued to exceed the levels required
by regulation, currently 10% and 5%, respectively, for a bank to be
considered well-capitalized.
Tracy L. Keegan, Executive Vice President and Chief Financial
Officer, added, "It was gratifying to see net interest margin
increase 8 basis points during 2017, reflecting the success of the
operating strategies we implemented this past year to grow loans
and noninterest-bearing deposits, resulting in a more diversified
balance sheet."
Commenting on the revaluation adjustment made on the Company's
net deferred tax assets, Keegan said "The charge of $1.6 million
was recorded as an increase in income tax expense for the fourth
quarter of 2017. Deferred tax assets and liabilities occur due to
temporary differences between the financial reporting and the tax
bases of the Company's assets and liabilities at enacted tax rates
expected to be in effect when such amounts are realized or settled.
With the new tax legislation passed in December 2017, the Company's
net deferred tax assets are now expected to be settled at a
statutory rate of 21% rather than the statutory rate of 35% used
previously to value these deferred tax assets." Keegan also noted
that the Company incurred merger-related costs of approximately
$0.4 million in the fourth quarter of 2017.
Bank Regulatory Capital At
Key Capital
Measures
Dec. 31, 2017 Dec. 31, 2016 Total risk-based
capital ratio (to risk-weighted assets) 12.51 % 14.83 % Common
equity tier 1 (core) risk-based capital ratio (to risk-weighted
assets) 11.42 % 13.58 % Tier 1 (core) risk-based capital ratio (to
risk-weighted assets) 11.42 % 13.58 % Tier 1 (core) capital ratio
(to adjusted total assets) 9.66 % 9.44 %
The decrease in risk-weighted capital ratios at December 31,
2017, compared with December 31, 2016, reflected an increase in
risk-weighted assets due to growth in portfolio loans and a
decrease in cash and cash equivalents and investment securities, as
well as an increase in the risk weighting of certain portfolio loan
categories, partially offset by an increase in equity due to
accumulated earnings. The charge to remeasure net deferred tax
assets, together with merger related expenses, reduced the
Company's Tier 1 (core) capital ratio as of December 31, 2017, by
approximately 20 basis points.
Credit Quality
At Dec. 31, 2017 Dec. 31, 2016
(Dollars in millions) Nonperforming loans $ 7.8 $ 10.1
Nonperforming loans to total portfolio loans 1.02 % 1.57 % Other
real estate owned $ 1.7 $ 2.9 Nonperforming assets $ 9.5 $ 13.0
Nonperforming assets to total assets 0.97 % 1.44 % Troubled debt
restructurings performing for less than 12 monthsunder terms of
modification (1) $ 15.2 $ 14.6 Troubled debt restructurings
performing for more than 12 monthsunder terms of modification $
15.7 $ 20.3
_________________________
(1) Includes $5.9 million and $7.9 million of nonperforming
loans at December 31, 2017 and 2016, respectively.
Nonperforming assets have declined for five consecutive quarters
as the Company's overall credit quality remained stable and the
general pace of loans reclassified to nonperforming remained slow
during the last 12 months. Importantly, OREO declined significantly
as of December 31, 2017, compared with that at December 31, 2016,
primarily due to the sale of a $2.4 million foreclosed property in
the second quarter of 2017, partially offset by the foreclosure of
a $1.6 million property in the fourth quarter of 2017, which was
expected to occur and had been fully reserved for prior to the
foreclosure.
Provision / Allowance for Loan Losses
At and for theThree Months
Ended
At and for theYear Ended
Dec. 31,2017
Sept. 30,2017
Dec. 31,2016
Dec. 31,2017
Dec. 31,2016
(Dollars in millions) Provision for portfolio loan losses $
0.2 $ 0.2 $ 0.1 $ 0.7 $ 0.6 Allowance for portfolio loan losses $
8.6 $ 8.4 $ 8.2 $ 8.6 $ 8.2 Allowance for portfolio loan losses to
total portfolio loans 1.12% 1.12% 1.26% 1.12% 1.26% Allowance for
portfolio loan losses to nonperforming loans 110.43% 88.16% 80.38%
110.43% 80.38% Net charge-offs (recoveries) $ 0.0 $ (0.0) $ 0.0 $
0.3 $ 0.2 Net charge-offs (recoveries) to average outstanding
portfolio loans (annualized) 0.02% (0.01)% 0.02% 0.04% 0.03%
Net charge-offs totaled $39,000 and $38,000 for the three months
ended December 31, 2017 and 2016, respectively, while net
recoveries totaled $18,000 for the three months ended September 30,
2017. This reflects a trend of solid economic conditions across the
Company's markets, which has led to continued low levels of net
charge-offs during the last 12 months.
The Company's provision for portfolio loan losses has remained
within a relatively narrow range over the past year. However, it
was up $185,000 for the three months ended December 31, 2017,
compared with the fourth quarter last year, and was up $74,000 for
the 12 months ended December 31, 2017, versus full year 2016. The
increase in the allowance for portfolio loan losses at December 31,
2017, compared with that at December 31, 2016, was attributable
primarily to loan growth, which reflected organic growth
supplemented by strategic loan purchases that were offset partially
by loan sales, principal amortization, and increased prepayments of
one- to four-family residential mortgages and home equity loans.
Management believes the allowance for portfolio loan losses at
December 31, 2017, is sufficient to absorb losses in portfolio
loans as of the end of the period.
Net Interest Income Three Months Ended
Year Ended
Dec. 31,2017
Sept. 30,2017
Dec. 31,2016
Dec. 31,2017
Dec. 31,2016
(Dollars in millions) Net interest income $ 7.2 $ 6.8 $ 7.1
$ 27.0 $ 26.5 Net interest margin 3.24 % 3.18 % 3.30 % 3.20 % 3.12
% Yield on investment securities 2.09 % 2.05 % 2.29 % 2.25 % 2.11 %
Yield on loans 4.47 % 4.31 % 4.40 % 4.33 % 4.37 % Total cost of
funds 1.03 % 0.98 % 0.78 % 0.93 % 0.92 % Average cost of deposits
0.85 % 0.80 % 0.66 % 0.77 % 0.62 % Rates paid on borrowed funds
1.83 % 2.02 % 1.14 % 1.88 % 1.70 %
The slight decrease in net interest margin during the three
months ended December 31, 2017, compared with net interest margin
for the three months ended December 31, 2016, reflected an increase
in rates paid on deposits and borrowed funds, with little to no
change in rates on new loans due to highly competitive lending
conditions. In addition, margin remains relatively stable given the
improved mix in core deposits and growth in noninterest-bearing
accounts. The increase in net interest margin during the 12 months
ended December 31, 2017, compared with net interest margin for the
12 months ended December 31, 2016, primarily reflected a decrease
in rates paid on funds due to an increase in noninterest-bearing
deposits, and an increase in higher-margin interest-earning assets
outstanding, reflecting the Company's ongoing redeployment of
excess liquidity to grow its portfolio loans, loans held-for-sale,
and warehouse loans held-for-investment.
Noninterest Income /
NoninterestExpense / Income Tax Expense
Three Months Ended Year Ended
Dec. 31,2017
Sept. 30,2017
Dec. 31,2016
Dec. 31,2017
Dec. 31,2016
(Dollars in millions) Noninterest income $ 1.3 $ 1.2 $ 1.9 $
7.0 $ 9.2 Noninterest expense $ 6.4 $ 6.1 $ 6.0 $ 25.6 $ 25.1
Income tax expense $ 2.5 $ 0.6 $ 1.0 $ 4.6 $ 3.6
The decrease in noninterest income for the three months ended
December 31, 2017, compared with that of the three months ended
December 31, 2016, primarily reflected lower gains on the sale of
portfolio loans and loans held-for-sale, as well as reduced service
charges and fees. The decrease in noninterest income for the 12
months ended December 31, 2017, compared with that of the 12 months
ended December 31, 2016, primarily reflected lower gains on the
sale of investment securities, lower gains on the sale of portfolio
loans, reduced service charges and fees, and a decrease in
miscellaneous operating income related to an escrow account that
was forfeited in 2016 in connection with an OREO sale, partially
offset by higher gains on the sale of loans held-for-sale.
The increase in noninterest expense during the three months
ended December 31, 2017, compared with that of the three months
ended December 31, 2016, primarily reflected an increase in
compensation and benefits, occupancy and equipment expense, and
merger-related costs associated with the proposed merger with
Ameris Bancorp, partially offset by reduced foreclosed asset
expense and a decrease in data processing expenses. The increase in
noninterest expense during the 12 months ended December 31, 2017,
compared with that of the 12 months ended December 31, 2016,
primarily reflected an increase in compensation and benefits,
increased data processing expenses associated with efforts to
improve the Company's IT infrastructure, an increase in occupancy
and equipment expense, and the aforementioned merger-related costs,
partially offset by the positive impact of an adjustment to the
rate of accrual for FDIC insurance premiums, reducing the amount
accrued for the full year, and a decrease in collection
expense.
The increase in income tax expense for the 3 and 12 months ended
December 31, 2017, compared with that of the 3 and 12 months ended
December 31, 2016, primarily reflected the impact of newly enacted
tax legislation, partially offset by a decline in income before
income tax expense.
Use of Non-GAAP Financial Measures
A non-GAAP financial measure is generally defined as a numerical
measure of a company's historical or future financial performance,
financial position, or cash flows that either excludes or includes
amounts, or is subject to adjustments, so as to be different from
the most directly comparable measure calculated and presented in
accordance with generally accepted accounting principles (GAAP).
Core earnings and core earnings per diluted share exclude the
effects of certain transactions that occurred during the period, as
detailed in the following reconciliation of these measures.
Three Months Ended Year Ended
Dec. 31,2017
Sept. 30,2017
Dec. 31,2016
Dec. 31,2017
Dec. 31,2016
(Dollars in thousands) Net income, as reported $ (616 ) $
1,115 $ 2,002 $ 3,168 $ 6,418 Less FHLB gain (1) -- -- (255 ) --
(255 ) Plus merger-related costs (2) 400 -- -- 411 -- Plus impact
of newly enacted tax laws (3) 1,641 --
-- 1,641 -- Adjusted net income (core
earnings) $ 1,425 $ 1,115 $ 1,747 $ 5,220 $ 6,163
Income per diluted share, as reported $ (0.04 ) $
0.07 $ 0.13 $ 0.21 $ 0.42 Less FHLB gain -- -- (0.02 ) -- (0.02 )
Plus merger-related costs 0.03 -- -- 0.03 -- Plus impact of newly
enacted tax laws 0.11 -- --
0.11 -- Adjusted income per diluted share(core
earnings per diluted share) (4) $ 0.09 $ 0.07 $ 0.11
$ 0.34 $ 0.40
_________________________
(1) The FHLB gain, which is included in noninterest income,
totaled $412,000, and is shown above net of a tax expense
adjustment of $157,000.
(2) The merger-related costs, which are included in noninterest
expense, totaled $443,000 and is shown above net of a tax expense
adjustment of $43,000 for the three months ended December 31, 2017.
The merger-related costs totaled $454,000 and is shown above net of
a tax expense adjustment of $43,000 for the 12 months ended
December 31, 2017.
(3) The impact of newly enacted tax laws is included in income
tax expense.
(4) May not foot due to rounding.
Core earnings and core earnings per diluted share should be
viewed in addition to, and not as a substitute for or superior to,
net income and income per diluted share on a GAAP basis. Atlantic
Coast's management believes that the non-GAAP financial measures,
when considered together with GAAP financial measures, provide
information that is useful to investors in understanding
period-over-period operating results separate and apart from items
that may, or could, have a disproportionately positive or negative
impact on results in any particular period. Atlantic Coast's
management also believes that the non-GAAP financial measures aid
investors in analyzing the Company's business trends and in
understanding the Company's performance. In addition, the Company
may utilize non-GAAP financial measures as guides in forecasting,
budgeting and long-term planning processes and to measure operating
performance for some management compensation purposes.
About the Company
Atlantic Coast Financial Corporation is the holding company for
Atlantic Coast Bank, a Florida state-chartered commercial bank. It
is a community-oriented financial institution serving the Northeast
Florida, Central Florida and Southeast Georgia markets. Investors
may obtain additional information about Atlantic Coast Financial
Corporation on the Internet at www.AtlanticCoastBank.net, under
Investor Relations.
Forward-looking Statements
Statements in this press release that are not historical facts
are forward-looking statements that reflect management's current
expectations, assumptions and estimates of future performance and
economic conditions, and involve risks and uncertainties that could
cause actual results to differ materially from those anticipated by
the statements made herein. Such statements are made in reliance
upon the safe harbor provisions of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements generally are identifiable by the use of
forward-looking terminology such as "believes," "expects," "may,"
"will," "should," "plans," "intends," "projects," "targets,"
"estimates," "preliminary," or "anticipates" or the negative
thereof or comparable terminology, or by discussion of strategy or
goals or other future events, circumstances or effects. Moreover,
forward-looking statements in this release include, but are not
limited to, those relating to: the expected merger with Ameris
Bancorp; the strength of our ratio of allowance for portfolio loan
losses to total portfolio loans; and the allowance for portfolio
loan losses being sufficient to absorb losses in respect of
portfolio loans. The Company's consolidated financial results and
the forward-looking statements could be affected by many factors,
including but not limited to: general economic trends and changes
in interest rates; increased competition; changes in demand for
financial services; the state of the banking industry generally;
uncertainties associated with newly developed or acquired
operations; market disruptions; and cyber-security risks. Further
information relating to factors that may impact the Company's
results and forward-looking statements are disclosed in the
Company's filings with the Securities and Exchange Commission. In
particular, please refer to "Item 1A. Risk Factors" beginning on
page 38 of the Company's Annual Report on Form 10-K for the year
ended December 31, 2016. The forward-looking statements contained
in this release are made as of the date of this release, and the
Company disclaims any intention or obligation, other than imposed
by law, to update or revise any forward-looking statements, whether
as a result of new information, future events, or otherwise.
Additional Information and Where to Find It
Ameris Bancorp has filed a registration statement on Form S-4
(Registration Number 333-222563) with the Securities and Exchange
Commission to register the shares of Ameris Banorp’s common stock
that will be issued to Atlantic Coast's stockholders in connection
with the transaction. The registration statement includes a joint
proxy statement/prospectus and other relevant materials in
connection with the proposed merger transaction. BEFORE MAKING ANY
VOTING OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS ARE
URGED TO READ THE PROXY STATEMENT/PROSPECTUS REGARDING THE MERGER
AND ANY OTHER RELEVANT DOCUMENTS CAREFULLY IN THEIR ENTIRETY WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE MERGER. Investors and security holders may
obtain free copies of these documents and other documents filed
with the Securities and Exchange Commission on its website at
http://www.sec.gov. Investors and security holders may also obtain
free copies of the documents filed with the Securities and Exchange
Commission by Ameris Bancorp on its website at
http://www.AmerisBank.com and by Atlantic Coast on its website at
https://www.AtlanticCoastBank.net/.
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval.
Participants in the Merger Solicitation
Ameris Bancorp and Atlantic Coast, and certain of their
respective directors, executive officers and other members of
management and employees, may be deemed to be participants in the
solicitation of proxies from the stockholders of Atlantic Coast in
respect of the proposed merger transaction. Information regarding
the directors and executive officers of Ameris Bancorp and Atlantic
Coast and other persons who may be deemed participants in the
solicitation of the stockholders of Atlantic Coast in connection
with the proposed transaction are included in the proxy
statement/prospectus for Atlantic Coast's special meeting of
stockholders, which has been filed by Ameris with the Securities
and Exchange Commission. Information about Ameris Bancorp’s
directors and executive officers can also be found in Ameris
Bancorp’s definitive proxy statement in connection with its 2017
annual meeting of shareholders, as filed with the Securities and
Exchange Commission on April 3, 2017, and other documents
subsequently filed by Ameris Bancorp with the Securities and
Exchange Commission. Information about Atlantic Coast’s directors
and executive officers can also be found in Atlantic Coast’s
definitive proxy statement in connection with its 2017 annual
meeting of stockholders, as filed with the Securities and Exchange
Commission on April 18, 2017, and other documents subsequently
filed by Atlantic Coast with the Securities and Exchange
Commission. Additional information regarding the interests of such
participants is included in the proxy statement/prospectus and
other relevant documents regarding the proposed merger transaction
filed with the Securities and Exchange Commission when they become
available.
ATLANTIC COAST FINANCIAL
CORPORATION
Statements of Operations
(Unaudited)
(In thousands, except per share
amounts)
Three Months Ended Year Ended
Dec. 31,2017
Sept. 30,2017
Dec. 31,2016
Dec. 31,2017
Dec. 31,2016
Interest and dividend income: Loans, including fees $ 8,951 $ 8,364
$ 8,282 $ 32,812 $ 31,681 Securities and interest-earning deposits
in other financial institutions 401 347
423 1,560 2,208 Total interest and dividend
income 9,352 8,711 8,705 34,372 33,889 Interest expense:
Deposits 1,458 1,363 1,001 5,170 3,607 Securities sold under
agreements to repurchase -- -- -- -- 1 Federal Home Loan Bank
advances 676 595 588 2,208 3,808 Other borrowings --
-- -- -- 1 Total interest
expense 2,134 1,958 1,589 7,378 7,417 Net interest income
7,218 6,753 7,116 26,994 26,472 Provision for portfolio loan losses
235 167 50 693 619
Net interest income after provision
for portfolio loan losses
6,983 6,586 7,066 26,301 25,853 Noninterest income: Service
charges and fees 433 452 532 1,773 2,320 Gain on sale of securities
available-for-sale -- 9 -- 409 1,321 Gain on sale of portfolio
loans 38 -- 87 38 314 Gain on sale of loans held-for-sale 109 186
368 2,228 1,966 Bank owned life insurance earnings 118 117 116 470
465 Interchange fees 328 315 323 1,311 1,356 Other 244
156 514 756 1,505 Total
noninterest income 1,270 1,235 1,940 6,985 9,247 Noninterest
expense: Compensation and benefits 3,309 3,544 3,171 13,867 13,703
Occupancy and equipment 654 642 432 2,399 2,295 FDIC insurance
premiums 94 34 134 384 607 Foreclosed assets, net (13 ) (6 ) 81 280
335 Data processing 542 581 653 2,316 2,209 Outside professional
services 478 458 488 2,035 1,985 Collection expense and repossessed
asset losses 83 82 140 399 503 Merger-related costs 443 -- -- 454
-- Other 778 810 877
3,425 3,413 Total noninterest expense 6,368
6,145 5,976 25,559 25,050
Income before income tax expense 1,885 1,676 3,030 7,727 10,050
Income tax expense 2,501 561
1,028 4,559 3,632 Net income (loss) $ (616 ) $ 1,115
$ 2,002 $ 3,168 $ 6,418 Net income (loss) per basic
and diluted share $ (0.04 ) $ 0.07 $ 0.13 $ 0.21 $ 0.42
Basic and diluted weighted average shares outstanding
15,429 15,430 15,417 15,425
15,417
ATLANTIC COAST FINANCIAL
CORPORATION
Balance Sheets (Unaudited)
(Dollars in thousands)
Dec. 31, 2017 Dec. 31, 2016 ASSETS Cash
and due from financial institutions $ 3,432 $ 3,744 Short-term
interest-earning deposits 46,977 56,149 Total cash
and cash equivalents 50,409 59,893 Securities available-for-sale
37,683 65,293 Portfolio loans, net of allowance of $8,600 and
$8,162, respectively 757,506 639,245 Other loans: Loans
held-for-sale 3,623 7,147 Warehouse loans held-for-investment
81,687 80,577 Total other loans 85,310 87,724
Federal Home Loan Bank stock, at cost 9,892 8,792 Land, premises
and equipment, net 14,172 14,945 Bank owned life insurance 18,005
17,535 Other real estate owned 1,739 2,886 Accrued interest
receivable 2,267 1,979 Deferred tax assets, net 4,108 6,752 Other
assets 2,165 2,415 Total assets $ 983,256 $ 907,459
LIABILITIES AND STOCKHOLDERS'
EQUITY Deposits:
Noninterest-bearing demand $ 63,852 $ 59,696 Interest-bearing
demand 97,350 106,004 Savings and money markets 294,674 224,987
Time 219,927 237,726 Total deposits 675,803 628,413
Federal Home Loan Bank advances 213,525 188,758 Accrued expenses
and other liabilities 3,268 3,270 Total liabilities
892,596 820,441 Total stockholders' equity 90,660
87,018 Total liabilities and stockholders' equity $ 983,256
$ 907,459
ATLANTIC COAST FINANCIAL
CORPORATION
Selected Consolidated Financial Ratios
and Other Data (Unaudited)
(Dollars in thousands)
At and for theThree Months
EndedDec. 31,
At and for theYear
EndedDec. 31,
2017 2016
2017 2016 Interest
rate Net interest spread 3.08 % 3.20 % 3.06 % 3.01 % Net
interest margin 3.24 % 3.30 % 3.20 % 3.12 %
Average balances Portfolio loans receivable, net $ 756,964 $
650,269 $ 711,211 $ 645,946 Warehouse loans held-for-investment
33,907 90,996 36,294 65,974 Total interest-earning assets 889,950
862,303 842,921 848,013 Total assets 928,485 903,170 883,223
891,578 Deposits 685,210 606,441 672,591 579,429 Total
interest-bearing liabilities 762,847 755,182 721,877 748,544 Total
liabilities 836,014 816,064 792,678 806,488 Stockholders' equity
92,471 87,106 90,545 85,090
Performance ratios (annualized) Return on average total
assets (0.27 )% 0.89 % 0.36 % 0.72 % Return on average
stockholders' equity (2.66 )% 9.19 % 3.50 % 7.54 % Ratio of
operating expenses to average total assets 2.74 % 2.65 % 2.89 %
2.81 %
Credit and liquidity ratios Nonperforming loans $ 7,788 $
10,154 $ 7,788 $ 10,154 Foreclosed assets 1,739 2,886 1,739 2,886
Impaired loans 33,001 37,302 33,001 37,302 Nonperforming assets to
total assets 0.97 % 1.44 % 0.97 % 1.44 % Nonperforming loans to
total portfolio loans 1.02 % 1.57 % 1.02 % 1.57 % Allowance for
loan losses to nonperforming loans 110.43 % 80.38 % 110.43 % 80.38
% Allowance for loan losses to total portfolio loans 1.12 % 1.26 %
1.12 % 1.26 % Net charge-offs (recoveries) to average outstanding
portfolio loans (annualized) 0.02 % 0.02 % 0.04 % 0.03 % Ratio of
gross portfolio loans to total deposits 113.36 % 103.02 % 113.36 %
103.02 %
Capital ratios Tangible stockholders' equity to tangible
assets (1) 9.22 % 9.59 % 9.22 % 9.59 % Average stockholders' equity
to average total assets 9.96 % 9.64 % 10.25 % 9.54 %
Other Data Tangible book value per share (1) $ 5.83 $ 5.61 $
5.83 $ 5.61 Stock price per share 9.43 6.80 9.43 6.80 Stock price
per share to tangible book value per share (1) 161.78 % 121.19 %
161.78 % 121.19 %
_________________________
(1) Non-GAAP financial measure. Because the Company does not
currently have any intangible assets, tangible stockholders' equity
is equal to stockholders' equity, tangible assets is equal to
assets, and tangible book value is equal to book value.
Accordingly, no reconciliations are required for these
measures.
ATLANTIC COAST FINANCIAL
CORPORATION
Average Balances, Net Interest Income,
Yields Earned and Rates Paid (Unaudited)
(Dollars in thousands)
Three Months Ended Dec. 31, 2017
2016
AverageBalance
Interest
AverageYield / Cost
AverageBalance
Interest
AverageYield / Cost
Interest-earning assets: Loans $ 800,909 $ 8,951 4.47 % $ 753,610 $
8,282 4.40 % Investment securities 38,495 201 2.09 % 48,091 276
2.29 % Other interest-earning assets 50,546 200
1.58 % 60,602 147 0.97 % Total
interest-earning assets 889,950 9,352 4.20 % 862,303
8,705 4.04 % Noninterest-earning assets 38,535
40,867 Total assets $ 928,485 $ 903,170
Interest-bearing liabilities: Interest-bearing demand accounts $
99,278 $ 101 0.40 % $ 103,702 $ 115 0.44 % Savings deposits 57,871
17 0.12 % 58,690 18 0.12 % Money market accounts 237,695 596 1.00 %
157,381 289 0.74 % Time deposits 220,501 744 1.35 % 229,130 579
1.01 % Federal Home Loan Bank advances 147,500 676 1.83 % 206,279
588 1.14 % Other borrowings 2 -- 1.18 %
-- -- -- % Total interest-bearing liabilities 762,847
2,134 1.12 % 755,182 1,589 0.84 %
Noninterest-bearing liabilities 73,167 60,882 Total
liabilities 836,014 816,064 Total stockholders’ equity
92,471 87,106 Total liabilities and stockholders’ equity $
928,485 $ 903,170 Net interest income $ 7,218 $ 7,116
Net interest spread 3.08 % 3.20 % Net interest-earning
assets $ 127,103 $ 107,121 Net interest margin 3.24 % 3.30 %
Average interest-earning assets to average interest-bearing
liabilities 116.66 % 114.18 %
Year Ended Dec. 31, 2017 2016
AverageBalance
Interest
AverageYield / Cost
AverageBalance
Interest
AverageYield / Cost
Interest-earning assets: Loans $ 758,635 $ 32,812 4.33 % $ 725,595
$ 31,681 4.37 % Investment securities 43,548 978 2.25 % 75,364
1,591 2.11 % Other interest-earning assets 40,738 582
1.43 % 47,054 617 1.31 % Total
interest-earning assets 842,921 34,372 4.08 % 848,013
33,889 4.00 % Noninterest-earning assets
40,302 43,565 Total assets $ 883,223 $ 891,578
Interest-bearing liabilities: Interest-bearing demand accounts $
110,265 $ 497 0.45 % $ 103,309 $ 454 0.44 % Savings deposits 58,986
71 0.12 % 58,975 63 0.11 % Money market accounts 211,423 1,936 0.92
% 132,923 875 0.66 % Time deposits 223,986 2,666 1.19 % 229,815
2,215 0.96 % Securities sold under agreements to repurchase -- --
-- % 82 1 1.56 % Federal Home Loan Bank advances 117,216 2,208 1.88
% 223,399 3,808 1.70 % Other borrowings 1 --
1.21 % 41 1 1.63 % Total interest-bearing
liabilities 721,877 7,378 1.02 % 748,544 7,417
0.99 % Noninterest-bearing liabilities 70,801
57,944 Total liabilities 792,678 806,488 Total stockholders’ equity
90,545 85,090 Total liabilities and stockholders’
equity $ 883,223 $ 891,578 Net interest income $ 26,994
$ 26,472 Net interest spread 3.06 % 3.01 % Net
interest-earning assets $ 121,044 $ 99,469 Net interest margin 3.20
% 3.12 % Average interest-earning assets to average
interest-bearing liabilities 116.77 % 113.29 %
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version on businesswire.com: http://www.businesswire.com/news/home/20180123005465/en/
Atlantic Coast Financial CorporationTracy L. Keegan,
904-998-5501Executive Vice President andChief Financial Officer
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