Carolina Bank Holdings, Inc. Reports EPS of $0.22 in the First Quarter of 2016

GREENSBORO, N.C., April 28, 2016 (GLOBE NEWSWIRE) -- Carolina Bank Holdings, Inc. CLBH today reported first quarter 2016 results with highlights as follows:

1st Quarter 2016 Financial Highlights

Nonperforming assets declined to $8.1 million, or 1.15% of assets, at March 31, 2016 from $11.5 million, or 1.6% of assets, at March 31, 2015. Net loan loss recoveries were $97,000 and $134,000 in the first quarters of 2016 and 2015, respectively.
Average non-interest bearing demand deposits increased 17.3% in the first quarter of 2016 from average non-interest bearing demand deposits in first quarter of 2015.
Gain on the sale of SBA loans was $237,000 in the first quarter of 2016 compared to no gains in the first quarter of 2015.
Book value per common share increased to $12.45 at March 31, 2016 from $12.18 at December 31, 2015 and $11.48 at March 31, 2015.
Net income available to common shareholders decreased to $1,101,000, or $0.22 per diluted common share, in the first quarter of 2016 from $1,382,000, or $0.40 per diluted common share, in the first quarter of 2015.
New loans originated, excluding residential mortgage loans held for sale, increased to $69.3 million in the first quarter of 2016 compared to $33.6 million in the first quarter of 2015. Loans outstanding decreased during the quarter due to the timing of construction loan pay-offs and delayed funding of some of the new construction loan originations.
The Mortgage Division had a net loss of $166,000 in the first quarter of 2016 compared to net income of $439,000 in the first quarter of 2015.

Robert T. Braswell, President and CEO, commented, "I am pleased to report that our SBA lending has kicked into high gear with the recognition of $237,000 in gains during the quarter. This new lending niche provides Carolina Bank customers with additional options. Although outstanding loans declined during the quarter due to the timing of construction loan pay-offs, we expect loans outstanding to grow in the near future as recently originated loans fund up. While commercial loan originations were strong, residential mortgage activity was weak due to seasonal factors and due to delays related to new regulatory requirements. Applications for residential mortgage loans have recently increased which should boost originations in the mortgage division in the second quarter."

"We continue to build shareholder value with our continued emphasis on non-interest bearing demand deposits which grew, on an average basis, over 17% during the first quarter of 2016 from a year ago same quarter. We are also pleased with the improvement in our credit quality over the past few years which eliminated the need to make a provision for loan losses during the first quarter of 2016," said Braswell.

About the Company

Carolina Bank, the banking subsidiary of Carolina Bank Holdings, Inc. began banking operations on November 25, 1996. The parent company is a North Carolina corporation organized in 2000. The bank is engaged in lending and deposit gathering activities in the Piedmont Triad of North Carolina, with operations in four counties: Guilford, Alamance, Forsyth and Randolph. The bank has eight full-service banking locations, three in Greensboro, one in Asheboro, one in High Point, one in Burlington, and two in Winston-Salem. Residential mortgage loan production offices are located in Burlington, Chapel Hill, and Sanford in addition to a wholesale residential mortgage operation in Greensboro. The Company's stock is listed on the NASDAQ Global Market under the symbol CLBH. Further information is available on the Company's web site: www.carolinabank.com.

This press release contains forward-looking statements regarding future events. These statements are only predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks of managing our growth, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to be materially different from those in the forward-looking statements is contained in the Company's filings with the Securities and Exchange Commission. Carolina Bank Holdings, Inc. undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.


Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Balance Sheets
				March 31,			December 31,
					2016			2015
				(unaudited)
			(in thousands, except share data)
Assets
Cash and due from banks				$	5,466		$	6,559
Interest-bearing deposits with banks					87,254			69,233
Bank term deposits					19,839			16,604
Securities available-for-sale, at fair value					46,482			47,360
Securities held-to-maturity (fair values of $15,109 in 2016 and $15,226 in 2015)					14,600			14,954
Loans held for sale					36,133			39,583
Loans					455,139			465,804
Less allowance for loan losses					(5,969	)		(5,872	)
		Net loans			449,170			459,932
Premises and equipment, net					18,803			19,007
Other real estate owned					4,587			4,592
Bank-owned life insurance					11,936			11,843
Other assets					11,434			11,131
		Total assets		$	705,704		$	700,798

Liabilities and Stockholders' Equity
Deposits
	Non-interest bearing demand			$	132,235		$	125,189
	NOW, money market and savings				343,623			349,815
	Time				125,215			132,303
		Total deposits			601,073			607,307

Advances from the Federal Home Loan Bank					12,654			2,681
Securities sold under agreements to repurchase					47			47
Subordinated debentures					19,610			19,610
Other liabilities and accrued expenses					9,633			10,014
		Total liabilities			643,017			639,659

Stockholders' equity
	Preferred stock, no par value, authorized 1,000,000 shares;
		Series A preferred stock - none issued and outstanding			-			-
		Series B convertible preferred stock - none issued and outstanding			-			-
	Common stock, $1 par value; authorized 20,000,000 shares; issued
		and outstanding 5,037,108 in 2016 and 5,021,330 in 2015			5,037			5,021
	Additional paid-in capital				29,383			29,234
	Retained earnings				27,275			26,174
	Stock in directors' rabbi trust				(1,931	)		(1,831	)
	Directors' deferred fees obligation				1,931			1,831
	Accumulated other comprehensive income				992			710
		Total stockholders' equity			62,687			61,139
		Total liabilities and stockholders' equity		$	705,704		$	700,798

Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Statements of Income (unaudited)
			Three Months
			Ended March 31,
				2016		2015
			(in thousands, except per share data)
Interest income
	Loans		$	5,830	$	5,992
	Investment securities, taxable			392		338
	Investment securities, non taxable			118		122
	Interest from deposits in banks			154		61
		Total interest income		6,494		6,513

Interest expense
	NOW, money market, savings			239		239
	Time deposits			262		312
	Other borrowed funds			222		152
		Total interest expense		723		703

Net interest income				5,771		5,810
Provision for loan losses				-		300
Net interest income after provision for loan losses				5,771		5,510
Non-interest income
	Service charges			291		303
	Mortgage banking income			1,703		2,907
	Gain on sale of SBA loans			237		-
	Other			58		73
		Total non-interest income		2,289		3,283

Non-interest expense
	Salaries and benefits			4,237		4,318
	Occupancy and equipment			749		776
	Foreclosed property expense (income)			45		(131	)
	Professional fees			415		449
	Outside data processing			274		274
	FDIC insurance			93		131
	Advertising and promotion			277		193
	Stationery, printing and supplies			131		151
	Other			409		381
		Total non-interest expense		6,630		6,542

Income before income taxes				1,430		2,251
Income tax expense				329		622
Net income				1,101		1,629
Dividends and accretion on preferred stock				-		247
Net income available to common stockholders			$	1,101	$	1,382
Net income per common share
	Basic		$	0.22	$	0.40
	Diluted		$	0.22	$	0.40

Carolina Bank Holdings, Inc.
Consolidated Financial Highlights
First Quarter 2016
(unaudited)
		Quarterly															Years Ended
		1st Qtr			4th Qtr			3rd Qtr			2nd Qtr			1st Qtr
($ in thousands except for share data)			2016			2015			2015			2015			2015			2015		2014

EARNINGS
Net interest income	$		5,771			6,081			5,889			5,865			5,810			23,645		23,257
Provision for loan losses	$		-			(200	)		450			535			300			1,085		1,436
NonInterest income	$		2,289			2,591			3,641			4,128			3,283			13,643		9,413
NonInterest expense	$		6,630			7,276			7,015			7,101			6,542			27,934		27,004
Net income	$		1,101			1,036			1,436			1,666			1,629			5,767		3,346
Net income available to common stockholders	$		1,101			1,036			1,436			1,572			1,382			5,426		2,413
Basic earnings per common share	$		0.22			0.21			0.29			0.38			0.40			1.24		0.70
Diluted earnings per common share	$		0.22			0.21			0.29			0.32			0.40			1.17		0.70
Average common shares outstanding			5,036,150			5,008,301			4,990,163			4,099,303			3,434,680			4,389,086		3,431,385
Average diluted common shares outstanding			5,041,038			5,019,056			5,000,352			4,988,938			3,451,902			4,620,411		3,433,603

PERFORMANCE RATIOS
Return on average assets *			0.63	%		0.59	%		0.83	%		0.96	%		0.97	%		0.84	%	0.50	%
Return on average common equity ** *			7.14	%		6.79	%		9.59	%		11.38	%		13.24	%		9.96	%	6.05	%
Net interest margin (fully-tax equivalent) *			3.61	%		3.79	%		3.74	%		3.65	%		3.75	%		3.73	%	3.80	%
Efficiency ratio			80.98	%		83.05	%		72.94	%		70.38	%		71.21	%		74.18	%	81.78	%
Efficiency ratio (excluding mortgage division)			71.95	%		75.06	%		73.29	%		69.79	%		68.63	%		71.72	%	71.73	%
# full-time equivalent employees - period end			190			192			190			192			191			192		189

CAPITAL
Equity to period-end assets			8.88	%		8.72	%		8.72	%		8.55	%		9.60	%		8.72	%	7.75	%
Common tangible equity to assets			8.88	%		8.72	%		8.72	%		8.55	%		6.07	%		8.72	%	6.13	%
Tier 1 leverage capital ratio - Bank			9.74	%		9.71	%		9.65	%		9.24	%		9.20	%		9.71	%	9.11	%
Tier 1 risk-based capital ratio - Bank			12.62	%		12.09	%		11.66	%		11.23	%		11.25	%		12.09	%	11.42	%
Total risk-based capital ratio - Bank			14.40	%		13.81	%		13.90	%		13.21	%		13.50	%		13.81	%	13.67	%
Book value per common share	$		12.45			12.18			12.04			11.72			11.48			12.18		12.13

ASSET QUALITY
Net loan charge-offs (recoveries)	$		(97	)		1,495			(1,321	)		1,694			(134	)		1,733		2,579
Net charge-offs (recoveries) to average loans *			-0.08	%		1.29	%		-1.15	%		1.45	%		-0.11	%		0.37	%	0.56	%
Allowance for loan losses	$		5,969			5,872			7,567			5,795			6,954			5,872		6,520
Allowance for loan losses to loans held invst.			1.31	%		1.26	%		1.62	%		1.26	%		1.49	%		1.26	%	1.38	%
Nonperforming loans	$		3,519			3,110			8,964			11,716			6,362			3,110		6,458
Performing restructured loans	$		12,078			9,687			9,317			9,450			9,548			9,687		9,774
Other real estate owned	$		4,587			4,592			5,073			5,352			5,116			4,592		5,610
Nonperforming loans to loans held for investment			0.77	%		0.67	%		1.92	%		2.54	%		1.36	%		0.67	%	1.37	%
Nonperforming assets to total assets			1.15	%		1.10	%		2.04	%		2.50	%		1.62	%		1.10	%	1.78	%

END OF PERIOD BALANCES
Total assets	$		705,704			700,798			688,974			683,685			710,672			700,798		679,263
Total loans held for investment	$		455,139			465,804			465,889			461,000			467,232			465,804		472,189
Total deposits	$		601,073			607,307			596,489			592,719			609,417			607,307		594,898
Stockholders' equity	$		62,687			61,139			60,098			58,460			68,238			61,139		52,655

AVERAGE BALANCES
Total assets	$		702,473			692,522			684,917			699,101			682,777			689,842		664,812
Total earning assets	$		657,915			646,158			633,304			654,317			638,368			643,031		620,996
Total loans held for investment	$		466,301			463,285			459,538			465,914			472,073			465,163		462,870
Total non interest-bearing demand deposits	$		129,367			125,279			119,074			118,577			110,318			118,355		94,618
Common stockholders' equity	$		61,979			60,522			59,384			55,414			42,341			54,479		39,904

* annualized for all periods presented
**return on average common equity is computed using net income available to common stockholders

FOR ADDITIONAL INFORMATION, PLEASE CONTACT: Carolina Bank Holdings, Inc. T. Allen Liles, EVP and CFO Telephone: 336-286-8746 Email: a.liles@carolinabank.com

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