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Century Next Financial Corporation Reports 2018 Yearend Results

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RUSTON, La., Feb. 05, 2019 (GLOBE NEWSWIRE) -- Century Next Financial Corporation (OTCQX:CTUY), the holding company of Century Next Bank, (Formerly, Bank of Ruston), with $462.2 million in assets, today announced financial results for the year ended December 31, 2018.

Financial Performance

For the year ended December 31, 2018, Century Next Financial Corporation (the "Company") had net income after tax of $3.43 million compared to net income of $2.36 million for the year ended December 31, 2017, an increase of $1.07 million or 45.6%. Earnings per share (EPS) for the full year were $2.78 per basic and $2.70 per diluted share compared to $2.05 per basic and $1.98 per diluted share reported for the full year ended December 31, 2017. Net income for 2017 included a charge of $414,000, or $0.35 per basic and $0.34 per diluted share, related to the 2017 Tax Cuts and Jobs Act enacted in December of 2017 for the cumulative effect on deferred taxes. All earnings per share amounts are adjusted for the 10% stock dividend paid in December 2018.

Balance Sheet

Overall, total assets increased by $178.6 million or 63.0% to $462.2 million at December 31, 2018 compared to $283.6 million at December 31, 2017. Approximately $149.8 million or 52.8% of the increase was due to the acquisition of Ashley Bancstock Company and its bank subsidiary, First National Bank of Crossett in Arkansas, (the "Acquisition") in the 4th quarter of 2018.

The largest component of assets, loans, net of deferred fees and costs and the allowance for loan losses, including loans held for sale, increased $137.9 million or 58.1% for the year ended December 31, 2018 compared to December 31, 2017. Total net loans at December 31, 2018 were $375.3 million compared to $237.4 million at December 31, 2017. Approximately $101.3 million or 42.7% of the increase was from the Acquisition. Net loan growth year over year was broad based with total loans secured by real estate up $86.8 million or 40.5% and commercial, non-real estate loans and all other loans up $51.7 million or 206.0%. There were slight decreases in home equity lines of credit and agricultural loans year over year of $743,000 and $288,000, respectively.

Total deposits at December 31, 2018 increased $155.4 million or 68.2% to $383.3 million compared to $227.9 million at December 31, 2017. Approximately $129.3 million or 56.7% of the increase was from the Acquisition. Year over year, interest-bearing checking deposits were up $40.1 million, time deposits were up $35.9 million, noninterest-bearing deposits were up $33.3 million, savings deposits were up $25.7 million, and money market deposits were up $20.4 million. 

Total short-term borrowings increased to $22.0 million at December 31, 2018 from $3.2 million at December 31, 2017, an increase of $18.8 million, while long-term borrowings decreased $13.6 million to $8.5 million at December 31, 2018 from $22.1 million at December 31, 2017. The net increase in short-term borrowings and the net decrease in long-term borrowings were primarily due to the reclassification of a Federal Home Loan (FHLB) discount note in December for $22.0 million from long- to short-term because of the December 2019 maturity date. 

Income Statement

Net interest income was $12.77 million for the year ended December 31, 2018 compared to $10.44 million for the year ended December 31, 2017. This was an increase of $2.33 million, or 22.3%. Approximately $1.1 million or 10.4% of the increase was from the inclusion of two months of net interest income following the Acquisition. The overall increase for the year was primarily from interest income earned on loans from increased volume. 

The provision for loan losses amounted to $780,000 for the year ended December 31, 2018, compared to $645,000 in provision for the year ended December 31, 2017. The increase of $135,000 or 20.9% in loan loss provision year over year was primarily a reflection of loan growth and an increased risk awareness and identification to strengthen the allowance for loan losses. No additional provision was necessary as a result of the Acquisition primarily due to the acquired loans being recorded at fair market value including a credit mark component as of the date of the Acquisition.

Total non-interest income amounted to $1.96 million for the year ended December 31, 2018 compared to $1.65 million for the year ended December 31, 2017, an increase of $306,000 or 18.5%. The increase was due to increases of $249,000 in service charges on deposits and $162,000 in other income offset by a $42,000 net loss from sales of loans, a $34,000 decrease in loan servicing release fees, and a $29,000 loss on sale of foreclosed assets.

Total non-interest expense increased by $2.4 million or 31.9% to $9.8 million for the year ended December 31, 2018 compared to $7.4 million for the year ended December 31, 2017. The increase year over year was primarily due to a $1.0 million increase in salaries and employee benefits due to staff additions, compensation increases, acquisition severance payouts, and pension expense and health insurance increases, a $584,000 increase in legal expenses associated with the acquisition, and a net increase in all other operating expenses of $784,000 which included other expenses associated with the Acquisition. The Company's efficiency ratio, a measure of expense as a percent of total income, increased to 66.5% for the year ended December 31, 2018 compared to 61.3% for the year ended December 31, 2017.

Other Financial Information

Nonperforming assets, including loans past due 90 days or more, nonaccrual loans, and other foreclosed assets, increased from $749,000 at December 31, 2017 to $1.98 million at December 31, 2018. Total non-performing assets were 0.43% and 0.26% of totals assets as of December 31, 2018 and 2017, respectively. Allowance for loan losses were $2.57 million or 0.68% of total loans at December 31, 2018 compared to $1.97 million or 0.82% of total loans at December 31, 2017. Net charge-offs for the year ended December 31, 2018 were $181,000 compared to net charge-offs of $43,000 for the year ended December 31, 2017. The ratios of net charge-offs to average loans outstanding were 0.06% and 0.02% at December 31, 2018 and 2017, respectively.

Additional Information

Century Next Financial Corporation is the holding company for Century Next Bank (the "Bank") which conducts business from its main office in Ruston, Louisiana and five full-service branch offices. The Company was formed in 2010 and is subject to the regulatory oversight of the Board of Governors of the Federal Reserve System. The Bank is a wholly-owned subsidiary and is an insured federally-chartered stock savings association subject to the regulatory oversight of the Office of the Comptroller of the Currency. The Bank was established in 1905 and is headquartered in Ruston, Louisiana. The Bank is a full-service bank with three locations in Louisiana including two banking offices in Ruston and one banking office in Monroe, and four locations in Arkansas including two banking offices in Crossett, one banking office in Hamburg, and one drive-through location in Fountain Hill. The Bank emphasizes professional and personal banking service directed primarily to small and medium-sized businesses, professionals, and individuals. The Bank provides a full range of banking services including its primary business of real estate lending to residential and commercial customers.

Statements contained in this news release which are not historical facts may be forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional verbs such as "will," "would," "should," "could," or "may." We undertake no obligation to update any forward-looking statements.

       
Century Next Financial Corporation and Subsidiary
Condensed Consolidated Balance Sheets (unaudited)
       
(In thousands, except per share data)      
       
  December 31
  2018   2017
       
ASSETS      
       
Cash and cash equivalents $ 54,454   $ 30,611
Investment securities   2,958     2,614
Loans, net   375,342     237,449
Other assets   29,493     12,939
TOTAL ASSETS $ 462,247   $ 283,613
LIABILITIES AND STOCKHOLDERS' EQUITY      
       
Deposits $ 383,320   $ 227,922
Short-term borrowings   22,000     3,250
Long-term borrowings   8,542     22,134
Other liabilities   3,415     2,155
Total Liabilities   417,277     255,461
Stockholders' equity   44,970     28,152
       
       
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 462,247   $ 283,613
Book Value per share $ 27.16   $ 25.80
       


       
Century Next Financial Corporation and Subsidiary
Consolidated Statements of Income (unaudited)
 
(In thousands, except per share data)      
       
  Years Ended December 31
  2018   2017
       
Interest Income $ 16,067   $ 12,100
Interest Expense   3,295     1,658
Net Interest Income   12,772     10,442
Provision for Loan Losses   780     645
Net interest income after provision for loan losses   11,992     9,797
Noninterest Income   1,958     1,652
Noninterest Expense   9,789     7,419
Income Before Taxes   4,161     4,030
Provision For Income Taxes   732     1,675
NET INCOME $ 3,429   $ 2,355
       
       
EARNINGS PER SHARE      
Basic $ 2.78   $ 2.05
Diluted $ 2.70   $ 1.98
       
       

Century Next Financial Corporation Contact Information:

William D. Hogan, President & Chief Executive Officer or
Mark A. Taylor, CPA, Executive Vice President & Chief Financial Officer
(318) 255-3733

Company Website: www.cnext.bank

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