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MBT Financial Corp. Announces Third Quarter 2016 Profit and Dividend

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MONROE, Mich., Oct. 27, 2016 (GLOBE NEWSWIRE) -- MBT Financial Corp., (Nasdaq: MBTF), the parent company of Monroe Bank & Trust, reported a preliminary net profit of $3,687,000 ($0.16 per share, basic and diluted), in the third quarter of 2016, compared to a profit of $3,006,000 ($0.13 per share, basic and diluted), in the third quarter of 2015. Year to date profit is $10,923,000 ($0.48 per share, basic and diluted) compared to $8,068,000 ($0.35 per share, basic and diluted) in the first three quarters of 2015.

The Company also announced that it will pay a dividend of $0.04 per share on November 17, 2016 to shareholders of record as of November 10, 2016. The Company did not pay a dividend in the same period in 2015.

Earnings for the Company improved this quarter due to increases in net interest income and non-interest income and decreases in the provision for loan losses and non-interest expenses compared to the third quarter of 2015. The net interest margin was unchanged at 3.11% in the third quarter of 2016 compared to the third quarter of 2015, however the average amount of interest earning assets increased $43.7 million, and as a result, the net interest income increased $291,000, or 3.2% in the third quarter of 2016 compared to the third quarter of 2015. 

The provision for loan losses decreased $500,000 compared to the third quarter of 2015 from a negative expense of $200,000 in the third quarter of 2015 to a negative expense of $700,000 recorded this quarter. Classified assets decreased 16.6% during the third quarter and the analysis of the risk in the loan portfolio indicated a need to reduce the Allowance for Loan Losses again this quarter. Total Loans increased $17.2 million during the third quarter, but the continued improvement in asset quality and historical loss ratios enabled the Company to reduce the Allowance for Loan and Lease Losses from 1.55% of loans at the end of the second quarter to 1.43% as of the end of the third quarter of 2016.

Non-interest income, excluding Other Real Estate and securities gains and losses was unchanged at $3.9 million in the third quarter of 2016 and 2015. Securities gains increased from $16,000 in the third quarter of 2015 to $87,000 in the third quarter of 2016 and total non-interest income increased $61,000 or 1.5% compared to last year.

Total non-interest expenses decreased $192,000, or 2.1% in the third quarter of 2016 compared to the third quarter of 2015. Salaries and benefits decreased $180,000 or 3.2% as a result of the efficiency initiative that reduced our staffing in the fourth quarter of 2015. The FDIC deposit insurance assessment decreased $33,000 and other insurance decreased $85,000 due to the improved financial condition of the bank.

Total assets of the company increased $713,000, or 0.1% compared to December 31, 2015. Capital increased $321,000 during the first nine months of 2016 even though the payment of the special and regular dividends exceeded the net income for the period because the AOCI increased $4.1 million due to the increase in the value of AFS securities. The ratio of equity to assets increased from 10.98% at the end of 2015 to 10.99% at September 30, 2016. The Bank's Tier 1 Leverage ratio decreased from 10.91% as of December 31, 2015 to 10.52% as of September 30, 2016.

H. Douglas Chaffin, President and CEO, commented, "Our results this quarter are a product of our continued focus on growth and cost control, along with improvements in the local economy and our portfolio.  We have been effective at growing the loan book and net interest income, while controlling non-interest expense.  We plan to continue growing loans and fee income, as we also improve our operational efficiency. We will also continue to actively manage our capital, along with looking for the right opportunities to fund growth, throughout our existing branch network and strategic acquisitions.  We remain confident in our ability to maintain our position as the premier independent provider of financial services in the communities we serve, despite challenges in our current environment."

Conference Call
MBT Financial Corp. will hold a conference call to discuss the Third Quarter 2016 results on Friday, October 28, 2016, at 10:00 a.m. Eastern Time. The call will be webcast and can be accessed at the Investor Relations/Corporate Profile page of MBT Financial Corp.'s web site www.mbandt.com. The call can also be accessed in the United States by calling toll free (877) 510-3783. The toll free number for callers in Canada is (855) 669-9657 and international callers can access the call at (412) 902-4136. A replay will be available one hour after the conclusion of the call at (877) 344-7529, Conference #10093588. The replay will be available until November 28, 2016 at 9:00 a.m. Eastern. The webcast will be archived on the Company's web site and available for twelve months following the call.

About the Company:
MBT Financial Corp. (NASDAQ: MBTF), a bank holding company headquartered in Monroe, Michigan, is the parent company of Monroe Bank & Trust ("MBT"). Founded in 1858, MBT is one of the largest independently owned community banks in Southeast Michigan.  With over $1.3 billion in assets, MBT is a full-service bank, offering a complete range of business and personal accounts, credit and mortgage options, investment and retirement services and award-winning financial literacy outreach.  MBT employee volunteers contribute approximately 9,000 hours of community service annually. MBT's Commercial Lending Group is a top SBA lending partner.  MBT's Wealth Management Group ("WMG") is one of the largest and most respected in Michigan.  The Michigan Bankers Association ranks MBT fourth among all Michigan banks for total trust assets.  With offices and ATMs in Monroe, Lenawee, and Wayne Counties, convenient mobile and online banking, a robust online and social media presence and a comprehensive array of products and services, MBT prides itself in offering World Class Banking with a Local Address. Visit MBT's website at www.mbandt.com.

Forward-Looking Statements
Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of Section 21A of the Securities Exchange Act of 1934.  Forward-looking statements which are based on various assumptions (some of which are beyond the Company's control), may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of these terms.  Actual results could differ materially from those set forth in forward-looking statements, due to a variety of factors, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset/liability management, change in the financial and securities markets, including changes with respect to the market value of our financial assets, the availability of and costs associated with sources of liquidity, and the ability of the Company to resolve or dispose of problem loans.  The Company undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.

MBT FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED
                 
    Quarterly Year to Date
    2016
 2016
 2016
 2015
 2015
    
(dollars in thousands except per share data) 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr 3rd Qtr 2016
 2015
                 
EARNINGS              
 Net interest income $9,515  $9,244  $9,290  $9,328  $9,224  $28,049  $27,647 
 FTE Net interest income $9,671  $9,393  $9,438  $9,469  $9,358  $28,502  $28,045 
 Provision for loan and lease losses $(700) $(200) $(300) $(2,000) $(200) $(1,200) $(1,000)
 Non interest income $4,039  $5,555  $4,114  $3,919  $3,978  $13,708  $11,408 
 Non interest expense $8,974  $8,872  $9,483  $9,485  $9,166  $27,329  $28,715 
 Net income $3,687  $4,239  $2,997  $4,014  $3,006  $10,923  $8,068 
 Basic earnings per share $0.16  $0.19  $0.13  $0.18  $0.13  $0.48  $0.35 
 Diluted earnings per share $0.16  $0.18  $0.13  $0.18  $0.13  $0.48  $0.35 
 Average shares outstanding  22,733,134   22,884,350   22,854,556   22,764,801   22,748,974   22,823,682   22,734,952 
 Average diluted shares outstanding  22,915,278   23,049,718   23,014,957   22,967,108   22,949,063   22,988,364   22,916,444 
                 
PERFORMANCE RATIOS              
 Return on average assets  1.10%  1.28%  0.91%  1.22%  0.93%  1.10%  0.84%
 Return on average common equity  9.98%  11.87%  8.57%  10.79%  8.48%  10.15%  7.74%
                 
 Base Margin  3.07%  3.03%  3.04%  3.04%  3.05%  3.05%  3.06%
 FTE Adjustment  0.05%  0.05%  0.05%  0.05%  0.04%  0.05%  0.04%
 Loan Fees  -0.01%  0.02%  0.00%  0.02%  0.02%  0.01%  0.06%
 FTE Net Interest Margin  3.11%  3.10%  3.09%  3.11%  3.11%  3.11%  3.16%
                 
 Efficiency ratio  65.59%  67.83%  69.75%  72.10%  67.83%  67.71%  71.54%
 Full-time equivalent employees  281   288   288   297   337   286   347 
                 
CAPITAL              
 Average equity to average assets  11.05%  10.80%  10.65%  11.34%  10.96%  10.84%  10.92%
 Book value per share $6.49  $6.41  $6.22  $6.46  $6.42  $6.49  $6.42 
 Cash dividend per share $0.04  $0.03  $0.53  $-  $-  $0.60  $- 
                 
ASSET QUALITY              
 Loan Charge-Offs $114  $618  $209  $1,191  $192  $941  $921 
 Loan Recoveries $316  $184  $150  $1,091  $309  $650  $1,709 
 Net Charge-Offs $(202) $434  $59  $100  $(117) $291  $(788)
                 
 Allowance for loan and lease losses $9,405  $9,903  $10,537  $10,896  $12,996  $9,405  $12,996 
                 
 Nonaccrual Loans $6,545  $7,522  $8,079  $8,633  $10,623  $6,545  $10,623 
 Loans 90 days past due $32  $41  $17  $4  $6  $32  $6 
 Restructured loans $15,923  $16,701  $17,828  $18,910  $20,972  $15,923  $20,972 
  Total non performing loans $22,500  $24,264  $25,924  $27,547  $31,601  $22,500  $31,601 
 Other real estate owned & other assets $1,696  $1,818  $1,608  $2,383  $2,154  $1,696  $2,154 
  Total non performing assets $24,196  $26,082  $27,532  $29,930  $33,755  $24,196  $33,755 
                 
 Classified Loans $20,151  $24,365  $26,768  $28,490  $34,948  $20,151  $34,948 
 Other real estate owned & other assets $1,696  $1,818  $1,608  $2,383  $2,154  $1,696  $2,154 
  Total classified assets $21,847  $26,183  $28,376  $30,873  $37,102  $21,847  $37,102 
                 
 Net loan charge-offs to average loans  -0.12%  0.28%  0.04%  0.06%  -0.07%  0.06%  -0.17%
 Allowance for loan losses to total loans  1.43%  1.55%  1.70%  1.76%  2.08%  1.43%  2.08%
 Non performing loans to gross loans  3.43%  3.80%  4.19%  4.45%  5.05%  3.43%  5.05%
 Non performing assets to total assets  1.80%  1.97%  2.06%  2.23%  2.56%  1.80%  2.56%
 Classified assets to total capital  14.61%  17.70%  19.65%  20.06%  24.55%  14.61%  24.55%
 Allowance to non performing loans  41.80%  40.81%  40.65%  39.55%  41.13%  41.80%  41.13%
                 
END OF PERIOD BALANCES              
 Loans and leases $656,445  $639,199  $618,613  $618,785  $625,406  $656,445  $625,406 
 Total earning assets $1,232,863  $1,214,557  $1,227,990  $1,231,128  $1,212,892  $1,232,863  $1,212,892 
 Total assets $1,343,026  $1,323,415  $1,334,131  $1,342,313  $1,316,719  $1,343,026  $1,316,719 
 Deposits $1,180,461  $1,163,418  $1,162,733  $1,165,393  $1,136,809  $1,180,461  $1,136,809 
 Interest Bearing Liabilities $894,697  $893,027  $918,593  $926,598  $904,297  $894,697  $904,297 
 Shareholders' equity $147,662  $145,623  $142,424  $147,341  $146,154  $147,662  $146,154 
 Tier 1 Capital (Bank) $140,131  $138,059  $133,870  $142,997  $138,163  $140,131  $138,163 
 Total Shares Outstanding  22,736,116   22,728,558   22,902,198   22,790,707   22,761,327   22,736,116   22,761,327 
                 
AVERAGE BALANCES              
 Loans and leases $652,163  $625,435  $620,010  $621,217  $624,921  $632,608  $620,676 
 Total earning assets $1,234,255  $1,218,569  $1,227,703  $1,211,342  $1,190,561  $1,226,871  $1,183,612 
 Total assets $1,329,284  $1,329,935  $1,320,975  $1,302,176  $1,283,384  $1,326,739  $1,276,642 
 Deposits $1,178,941  $1,173,998  $1,164,320  $1,139,475  $1,130,807  $1,172,441  $1,125,723 
 Interest Bearing Liabilities $905,082  $920,340  $926,618  $902,216  $903,648  $917,300  $909,102 
 Shareholders' equity $146,926  $143,685  $140,684  $147,626  $140,619  $143,776  $139,382 
                 

 

MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
           
     Quarter Ended September 30,
 Nine Months Ended September 30,
Dollars in thousands (except per share data) 2016 2015 2016 2015
Interest Income       
Interest and fees on loans $7,538  $7,225  $21,752  $21,811 
Interest on investment securities-       
 Tax-exempt  316   278   924   826 
 Taxable  1,970   2,437   6,714   7,301 
Interest on balances due from banks  171   24   450   64 
   Total interest income  9,995   9,964   29,840   30,002 
           
Interest Expense       
Interest on deposits  480   562   1,483   1,826 
Interest on borrowed funds  -   178   308   529 
   Total interest expense  480   740   1,791   2,355 
           
Net Interest Income  9,515   9,224   28,049   27,647 
Provision For Loan Losses  (700)  (200)  (1,200)  (1,000)
           
Net Interest Income After       
Provision For Loan Losses  10,215   9,424   29,249   28,647 
           
Other Income       
Income from wealth management services  1,145   1,163   3,347   3,576 
Service charges and other fees  1,118   1,134   3,142   3,058 
Debit Card income  721   594   2,130   1,749 
Net gain on sales of securities  87   16   2,159   274 
Net gain (loss) on other real estate owned  (4)  36   (61)  (248)
Origination fees on mortgage loans sold  149   184   415   450 
Bank Owned Life Insurance income  352   358   1,069   991 
Other   471   493   1,507   1,558 
   Total other income  4,039   3,978   13,708   11,408 
           
Other Expenses       
Salaries and employee benefits  5,514   5,694   16,531   17,318 
Occupancy expense  668   648   2,002   2,074 
Equipment expense  731   708   2,141   2,232 
Marketing expense  280   267   825   821 
Professional fees  459   481   1,667   1,607 
EFT/ATM expense  235   109   781   317 
Other real estate owned expense  35   59   129   364 
FDIC deposit insurance assessment  179   212   539   1,055 
Bonding and other insurance expense  118   203   454   660 
Telephone expense  95   113   312   317 
Other   660   672   1,948   1,950 
   Total other expenses  8,974   9,166   27,329   28,715 
           
Profit Before Income Taxes  5,280   4,236   15,628   11,340 
Income Tax Expense  1,593   1,230   4,705   3,272 
Net Profit $3,687  $3,006  $10,923  $8,068 
           
Basic Earnings Per Common Share $0.16  $0.13  $0.48  $0.35 
           
Diluted Earnings Per Common Share $0.16  $0.13  $0.48  $0.35 
           
Dividends Declared Per Common Share $0.04  $-  $0.60  $- 
           

 

MBT FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
       
       
    (Unaudited)  
Dollars in thousandsSeptember 30, 2016 December 31, 2015
Assets    
Cash and Cash Equivalents   
 Cash and due from banks   
  Non-interest bearing$16,122  $14,996 
  Interest bearing 63,975   70,054 
  Total cash and cash equivalents 80,097   85,050 
       
Securities - Held to Maturity 42,685   41,282 
Securities - Available for Sale 465,610   496,859 
Federal Home Loan Bank stock - at cost 4,148   4,148 
Loans held for sale 636   1,477 
       
Loans  655,809   617,308 
Allowance for Loan Losses (9,405)  (10,896)
Loans - Net 646,404   606,412 
       
Accrued interest receivable and other assets 20,438   23,365 
Other Real Estate Owned 1,686   2,383 
Bank Owned Life Insurance 54,059   53,093 
Premises and Equipment - Net 27,263   28,244 
  Total assets$1,343,026  $1,342,313 
       
Liabilities   
Deposits:   
 Non-interest bearing$285,764  $253,795 
 Interest-bearing 894,697   911,598 
  Total deposits 1,180,461   1,165,393 
       
Repurchase agreements -   15,000 
Accrued interest payable and other liabilities 14,903   14,579 
  Total liabilities 1,195,364   1,194,972 
       
Shareholders' Equity   
Common stock (no par value) 22,474   23,492 
Retained Earnings 123,411   126,214 
Unearned Compensation (19)  (13)
Accumulated other comprehensive income (loss) 1,796   (2,352)
  Total shareholders' equity 147,662   147,341 
  Total liabilities and shareholders' equity$1,343,026  $1,342,313 
          
FOR FURTHER INFORMATION: H. Douglas Chaffin Chief Executive Officer (734) 384-8123 doug.chaffin@mbandt.com John L. Skibski Chief Financial Officer (734) 242-1879 john.skibski@mbandt.com Julian J. Broggio Director of Marketing (734) 240-2341 julian.broggio@mbandt.com

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