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

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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