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KS Bancorp, Inc. (KSBI) Announces Second Quarter 2019 Financial Results and Cash Dividend

SMITHFIELD, N.C., July 19, 2019 (GLOBE NEWSWIRE) -- KS Bancorp, Inc. (the “Company”) (KSBI), parent company of KS Bank, Inc. (the “Bank”), announced unaudited results for the second quarter of 2019.

Net income for the three months ended June 30, 2019 was $907,000, or $0.82 per diluted share  compared to net income of $887,000, or $0.71  per diluted share for the three months ended June 30, 2018. For the six months ended June 30, 2019, the Company reported $1.7 million, or $1.56 per diluted share compared to $1.6 million, or $1.31 per diluted share for the six months ended June 30, 2018.

Net interest income for the three months ended June 30, 2019,  was $3.2 million as compared to $3.1 million for the comparable period in 2018. Noninterest income for the three months ended June 30, 2019 was $860,000, compared to $882,000 for the comparable period ended June 30, 2018.  Noninterest expense remained constant at $2.9 million for the three months ended  June 30, 2019 as compared to the comparable period in 2018.

For the six months ended June 30, 2019, net interest income was $6.3 million, compared to $6.2 million for the six months ended June 30, 2018. Noninterest income remained constant at $1.6 million for the six months ended June 30, 2019 and June 30, 2018. Noninterest expense remained constant at $5.7 million for the six months ended June 30, 2019 and June 30, 2018.

The Company’s unaudited consolidated total assets decreased $3.3 million, to $396.9 million at June 30, 2019, compared to $400.2 million at December 31, 2018. Net loan balances increased by $8.3 million, to $303.9 million at June 30, 2019 compared to $295.6 million at December 31, 2018. The Company’s investment securities totaled $65.7 million at June 30, 2019, compared to $66.0 million at December 31, 2018.  Total deposits decreased $9.8 million to $320.6 million at June 30, 2019, compared to $330.4 million at December 31, 2018. The primary reduction in deposits was the result of a reduction of $6.3 million in brokered deposits. Total stockholders’ equity increased from $22.1 million at December 31, 2018 to $25.0 million at June 30, 2019, a 12.95% increase .
                        
Nonperforming assets consisted of $1.3 million nonaccrual loans at June 30, 2019, representing less than 0.50% of the Company’s total assets. The Company had no foreclosed real estate owned at June 30, 2019. The Company recorded a provision for loan loss of $25,000 for the three months ended June 30, 2019, compared to no provision for the same period in 2018. The allowance for loan losses at June 30, 2019 totaled $4.0 million, or 1.31% of  loans. 

Commenting on the second quarter results, Harold Keen, President and CEO of the Company and the Bank stated, “This quarter continues our efforts to balance growth and profits in line with building a strong community bank.  The increase in the per share earnings for the six months ending June 30, 2019 was $0.25 greater than the same period in 2018.  Building a solid foundation should prepare KS Bancorp for both the opportunities and challenges of the future.  Community banks with a long term focus are important for shareholders, customers, and all related stakeholders.”

In addition, the Company announced today that its Board of Directors has declared a quarterly  dividend of $0.09 per share for stockholders of record as of  July 19, 2019, with payment to be made on July 31, 2019. 

KS Bank continues to be well-capitalized according to regulatory standards with total risk-based capital of 14.15%, tier 1 risk- based capital of 12.89%, common equity tier 1 risk- based capital of 12.89%, and a tier 1 leverage ratio of  9.89% at June 30, 2019. The minimum levels to be considered well capitalized for each of these ratios are 10.0%, 8.0%, 6.5%, and 5.0%, respectively.

KS Bancorp, Inc. is a Smithfield, North Carolina-based single bank holding company. KS Bank, Inc., a state-chartered savings bank, is KS Bancorp’s sole subsidiary.  The Bank is a full service community bank serving the citizens of eastern North Carolina since 1924. The Bank offers a broad range of personal and business banking products and services, mortgage products and trust services. There are nine full service branches located in Kenly, Selma, Clayton, Garner, Goldsboro, Wilson, Wendell, Smithfield, and Four Oaks, North Carolina plus a mortgage servicing location in Greenville, NC. In addition, KS Trust Services has an office in Asheboro, NC and maintains a presence in Waynesville and Wilmington, NC.  For more information, visit www.ksbankinc.com.

This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company.  These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate” and “believe,” variations of these words and other similar expressions.  Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements.  The Company undertakes no obligation to update any forward-looking statements. 

Contact: Harold T. Keen                                                                      Regina J Smith
President and Chief Executive Officer                                                Chief Financial Officer
(919) 938-3101                                                                                   (919) 938-3101

KS Bancorp, Inc. and Subsidiary
Consolidated Statements of Financial Condition
                 
                 
    June 30, 2019     December 31,
    (unaudited)     2018*
                 
    (Dollars in thousands)
  ASSETS              
                 
  Cash and due from banks:              
  Interest-earning $ 9,040     $ 21,220  
  Noninterest-earning   2,402       2,184  
  Time Deposit   100       100  
  Investment securities available for sale, at fair value   65,711       66,004  
  Federal Home Loan Bank stock, at cost   1,763       1,696  
                 
  Loans   307,912       299,640  
  Less allowance for loan losses   (4,041 )     (4,010 )
  Net loans   303,871       295,630  
                 
  Accrued interest receivable   1,260       1,212  
  Property and equipment, net   7,816       7,324  
  Other assets   4,967       4,888  
                 
  Total assets $ 396,930     $ 400,258  
                 
  LIABILITIES AND STOCKHOLDERS' EQUITY              
                 
  Liabilities              
  Deposits $ 320,591     $ 330,423  
  Short-term borrowings   -       7  
  Long-term borrowings   47,248       44,248  
  Accrued interest payable   423       380  
  Accrued expenses and other liabilities   3,678       3,075  
                 
  Total liabilities   371,940       378,133  
                 
  Stockholder's Equity:              
  Common stock, no par value, authorized 20,000,000 shares;              
  1,107,776 shares issued and outstanding at June 30, 2019 and 1,107,776 shares issued and outstanding at December 31, 2018   1,360       1,360  
  Retained earnings, substantially restricted   23,575       22,026  
  Accumulated other comprehensive loss   55       (1,261 )
                 
  Total stockholders' equity   24,990       22,125  
                 
  Total liabilities and stockholders' equity $ 396,930     $ 400,258  
                 
  *  Derived from audited financial statements              
                 

 

KS Bancorp, Inc and Subsidiary
Consolidated Statements of Income (Unaudited)
             
             
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2019
  2018
  2019
  2018
    (In thousands, except per share data)
Interest and dividend income:                              
  Loans $ 3,978     $ 3,662     $ 7,839     $ 7,193  
  Investment securities                              
  Taxable   353       296       719       601  
  Tax-exempt   32       38       54       74  
  Dividends   24       22       51       43  
  Interest-bearing deposits   36       18       109       35  
  Total interest and dividend income   4,423       4,036       8,772       7,946  
                                 
Interest expense:                              
  Deposits   763       474       1,527       921  
  Borrowings   424       422       873       818  
  Total interest expense   1,187       896       2,400       1,739  
                                 
  Net interest income   3,236       3,140       6,372       6,207  
                                 
Provision for loan losses   25       -       25       -  
                                 
  Net interest income after                              
  provision for loan losses   3,211       3,140       6,347       6,207  
                                 
Noninterest income:                              
  Service charges on deposit accounts   370       347       705       689  
  Fees from presold mortgages   41       63       93       113  
  Other income   449       472       763       758  
  Total noninterest income   860       882       1,561       1,560  
                                 
Noninterest expenses:                              
  Compensation and benefits   1,786       1,773       3,490       3,489  
  Occupancy and equipment   317       298       626       617  
  Data processing & outside service fees   225       205       448       411  
  Advertising   35       19       74       44  
  Net foreclosed real estate   -       (1 )     -       (1 )
  Other   549       599       1,072       1,110  
  Total noninterest expenses   2,912       2,893       5,710       5,670  
                                 
  Income before income taxes   1,159       1,129       2,198       2,097  
                                 
Income tax   252       242       471       446  
                                 
  Net income $ 907     $ 887     $ 1,727     $ 1,651  
                                 
  Basic and Diluted earnings per share $ 0.82     $ 0.71     $ 1.56     $ 1.31