Century Next Financial Corporation Reports 1st Quarter 2020 Results

RUSTON, La., April 23, 2020 (GLOBE NEWSWIRE) -- Century Next Financial Corporation CTUY, the holding company of Century Next Bank, with $494.8 million in assets, today announced financial results for the 1^st quarter ended March 31, 2020.

Financial Performance

For the three months ended March 31, 2020, Century Next Financial Corporation (the "Company") had net income after tax of $1.0 million compared to net income of $1.2 million for the three months ended March 31, 2019, a decrease of $195,000 or 16.3%.  Earnings per share (EPS) for the three months ended March 31, 2020 were $0.62 per basic and $0.61 per diluted share compared to $0.74 per basic and $0.73 per diluted share reported for the three months ended March 31, 2019. 

Balance Sheet

Overall, total assets increased by $5.2 million or 1.06% to $494,818 million at March 31, 2020 compared to $489,606 million at December 31, 2019. 

The largest component of assets, loans, net of deferred fees and costs and the allowance for loan losses, including loans held for sale, increased $3.8 million or 0.94% for the three months ended March 31, 2020 compared to December 31, 2019.  Total net loans at March 31, 2020 were $405.8 million compared to $402.0 million at December 31, 2019.  Net loan growth reflects increases of $4.3 million in multi-family loans,  $2.0 million in land loans, $1.0 million in commercial non-real estate loans, $828,000 in consumer non-real estate loans, $81,000 in agricultural non-real estate loans and $14,000 in agricultural real estate loans.  These increases were offset by decreases $2.1 million in residential 1-4 family loans, $1.3 million in residential construction loans, $460,000 in home equity lines of credit, and $207,000 in commercial real estate loans.  The allowance for loan losses increased by $342,000 or 10.0% to $3.76 million at March 31, 2020 from $3.42 million at December 31, 2019.

Total deposits at March 31, 2020 increased $3.9 million or 0.9% to $425.7 million compared to $421.9 million at December 31, 2019.  Growth occurred in interest-bearing checking deposits of $6.8 million, noninterest-bearing checking deposits of $3.3 million, and savings deposits of $550,000.  The increases were offset by decreases in money market deposits of $5.2 million and time deposits of $1.6 million.

Total short-term borrowings decreased to $29,000 at March 31, 2020 from $41,000 at December 31, 2019, a decrease of $12,000 or 29.3%, while long-term borrowings did not change at $14.5 million as of March 31, 2020 compared to December 31, 2019.  The net decrease in short-term borrowings was primarily due to the payments made on an Federal Home Loan Bank (FHLB) note. 

Income Statement

Net interest income was $5.0 million for the three months ended March 31, 2020 compared to $4.7 million for the three months ended March 31, 2019.  This was an increase of $264,000, or 5.6%.  The increase for the year-over-year comparative quarters was a result of an increase in interest income earned on loans of $315,000 offset by a decrease in other interest income of $102,000 and the decreases of interest expense on short- and long-term borrowings offset by an increase in interest expense on deposits. 

The provision for loan losses amounted to $362,000 for the three months ended March 31, 2020, compared to $237,000 in provision for the three months ended March 31, 2019.  The increase of $125,000 or 52.7% in loan loss provision year over year was primarily a reflection of an increased risk awareness and identification of potential credit trend changes within the loan portfolio added to strengthen the allowance for loan losses.

Total non-interest income amounted to $866,000 for the three months ended March 31, 2020 compared to $834,000 for the three months ended March 31, 2019, an increase of $32,000 or 3.8%.  The increase was due to increases of $36,000 in loan servicing release fees from the sale of mortgage loans, $23,000 in service charges on deposit accounts, $19,000 from a decrease in the net loss from the sale of loans, and $3,000 from the net gain on sale of foreclosed assets.  The increases are offset by a decrease in other noninterest income of $49,000.

Total non-interest expense increased by $257,000 or 6.6% to $4.1 million for the three months ended March 31, 2020 compared to $3.9 million for the three months ended March 31, 2019.  The increase in overall expense was due primarily to increases in expenses of salaries and benefits of $392,000, other operating expenses of $124,000, advertising of $70,000, and occupancy and equipment of $27,000, and director's expense of $1,000.  The increases were offset by decreases in data processing expenses of $221,000, auditing and examination fees of $79,000, legal and professional of $29,000, foreclosed assets of $11,000, office supplies of $8,000, FDIC deposit insurance of $8,000, and amortization of intangibles of $1,000. The Company's efficiency ratio, a measure of expense as a percent of total income, increased to 70.58% for the three months ended March 31, 2020 compared to 69.72% for the three months ended March 31, 2019.

Other Financial Information

Nonperforming assets, including loans past due 90 days or more, nonaccrual loans, and other foreclosed assets, increased from $4.1 million at December 31, 2019 to $8.5 million at March 31, 2020.  Total non-performing assets were 1.72% and 0.84% of totals assets as of March 31, 2020 and December 31, 2019, respectively.  Allowance for loan losses were $3.76 million or 0.92% of total loans at March 31, 2020 compared to $3.42 million or 0.84% of total loans at December 31, 2019.  Net charge-offs for the three months ended March 31, 2020 were $20,000 compared to net charge-offs of $41,000 for the three months ended March 31, 2019.  The ratios of net charge-offs to average loans outstanding were 0.005% and 0.01% at March 31, 2020 and March 31, 2019, respectively.

COVID-19 Related Information

The Company's Pandemic Response Plan was activated in early March 2020 in response to guidance from regulatory and health agencies.  Measures were implemented to address the following:

• Provide guidance to employees on safety in the workplace,
• Accommodation for staff members working remotely,
• Adjustment of Company benefits to provide employee paid leave as necessary,
• Modifying operations of banking locations to minimize customer disruption,
• Procedural changes to allow continued customer access to banking services,
• Monitoring of safety conditions for employees and customers, news events, and other helpful information.

The safety and well-being of our employees and customers is the Company's top priority.

The Company is in the process of assessing the potential economic impact from the COVID-19 shutdown as it relates to both business and consumer customers of its bank subsidiary and the potential impact to credit quality and future earnings.  Conditions have not yet emerged to allow for a reasonable assessment of the impact, but the Company will continue to monitor conditions and react as appropriate to mitigate risks to its financial condition.

Assistance provided to business and individuals through the CARES Act enacted by Congress in late March 2020 will likely provide some relief for the economic effects of the shutdown.    

Branch Opening

On February 18, 2020, Century Next Bank, the wholly-owned subsidiary, opened a new full-service banking location at 1701 North 7^th Street in West Monroe, Louisiana.  This new location will extend our market reach and provide new opportunities for expansion of loans and deposits and new customer growth.

Company 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.  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 covered 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 four locations in Louisiana including two banking offices in Ruston, one banking office in Monroe, one banking office in West Monroe, and four locations in Arkansas including two banking offices in Crossett, one banking office in Hamburg, and one drive-through location with limited services 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)

Century Next Financial Corporation and Subsidiary
Consolidated Statements of Income (unaudited)

(In thousands, except per share data)

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