WINDSOR, Va., April 22, 2019 /PRNewswire/ -- Farmers Bankshares, Inc. (FBVA) reports unaudited earnings of $1.4 million, or $0.44 per share for the first quarter of 2019. These results increased approximately 50.44% from the $899 thousand, or $0.29 per share, earned during the first quarter of 2018.
Return on average assets on an annualized basis of 1.17% for the first quarter of 2019 increased from 0.79% from first quarter of 2018. Return on average equity during the first quarter of 2019 was 11.07% as compared to the prior year first quarter of 7.66%.
Richard J. Holland, Jr., Chairman and Chief Executive Officer, stated, "We are very pleased with the results from first quarter. We repaid a Federal Home Loan Bank advance and created liquidity through the sale of short term municipal securities that generated a gain and enhanced earnings. Organic loan growth remains a focus. Our loan to deposit ratio is 73.29% and lower than many peers; because of this we have been able to manage our deposit costs through relationship pricing. This allows us to continue to set our balance sheet up for long term earnings potential."
Net loans increased slightly by $2.6 million as compared to December 31, 2018. Deposit balances decreased by $15.4 million to $371.3 million as of March 31, 2019 from $386.7 million as of December 31, 2018. Non-interest bearing deposits decreased approximately $8.6 million from December 31, 2018 but still make up approximately 28.88% of total deposits. The decrease in non-interest bearing deposits is largely due to the cyclical nature of several large municipal deposits.
Net interest income increased 7.90% in the first quarter of 2019 compared to the first quarter of 2018. Non-interest income in the first quarter of 2019 was approximately $2.0 million and was increased by 57.65% over the same period in the prior year. The first quarter of 2019 included a pre-tax, non-recurring gain on the sale of securities of approximately $230 thousand. Exclusive of this transaction, non-interest income increased 39.66% over the first quarter of 2018. On January 1, 2019 our insurance subsidiary, Manry Rawls, LLC acquired a crop insurance agency headquartered in Williamston, North Carolina. The growth in non-interest income is largely due to additional insurance commissions from this acquisition. Non-interest expense increased by approximately $370 thousand or 9.23% during the first quarter 2019 compared to same period in 2018, largely due to employee expenses related to the same insurance acquisition.
Capital ratios at the Bank level remain strong and well above regulatory requirements for "Well Capitalized" financial institutions.
"We continue to remain vigilant with non-interest expenses. During the first quarter we purchased our Lakeside branch in Suffolk which we had leased since opening in 2004. We will realize approximately $40 thousand dollars in savings annually associated with purchasing versus leasing this property. Though non-interest income has become a strong contributor to net income we remain committed to expanding our banking presence in Chesapeake and the localities east of our traditional markets," stated Vernon M. Towler, President.
Farmers Bank, founded in 1919, is headquartered in Windsor, VA, and is a community bank which operates seven branches and services areas throughout Tidewater Virginia. Additional information is available at the company's website, www.farmersbankva.com.
The common stock of Farmers Bankshares, Inc. trades as an Over-the-Counter Bulletin Board stock under the symbol FBVA. Any stockbroker can assist with purchase of the company's stock, as well as with sales of holdings.
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