N@N

SBT Bancorp, Inc. Reports First Quarter 2011 Results

^{Published on 2011-04-29 15:11:29 - Market Wire}
 

SIMSBURY, Conn.--([ BUSINESS WIRE ])--SBT Bancorp, Inc., (OTCBB: SBTB), holding company for Simsbury Bank & Trust Company (the Bank), today announced net income of $87,000 or $0.03 per common diluted share for the first quarter of 2011. Net income for the quarter was impacted by a one-time charge related to the Banka™s formation of a Passive Investment Company (PIC). Excluding this one-time charge, net of a favorable income tax adjustment, net income would have been $259,000 or $0.23 per common diluted share. This compares to $243,000 or $0.21 per common diluted share for the first quarter of 2010. Total assets were $325 million on March 31, 2011 compared to $283 million on March 31, 2010, an increase of $42 million or 15%.

"Our customer focus remains the foundation of our success as it enables us to build shareholder value with an attractive, low-cost, relationship based deposit mix; a relatively low-risk mortgage, consumer and commercial loan portfolio; and a strong capital position."

Total deposits on March 31, 2011 were $299 million, an increase of $45 million or 18% over a year ago. Core deposits (Demand, Savings and NOW accounts) increased by $44 million or 25% while Time Deposits increased by $1 million or 1%. An increase in deposits from municipalities was a significant contributor to the growth in total deposits. At quarter-end, 19% of total deposits were in non-interest bearing demand accounts, 55% were in low-cost savings and NOW accounts, and 26% were in time deposits.

On March 31, 2011, loans outstanding were $205 million, an increase of $9 million, or 5%, over a year ago. The profile of the Companya™s loan portfolio remains relatively low-risk. The Companya™s allowance for loan losses as a percent of total loans was 1.13% at March 31, 2011 and March 31, 2010. The Company had non-accrual loans totaling $2.5 million equal to 1.24% of total loans on March 31, 2011 compared to non-accrual loans of $3.1 million or 1.59% of total loans a year ago. Total non-accrual loans and loans 30 or more days past due decreased from 1.66% of loans outstanding on March 31, 2010 to 1.30% of loans outstanding on March 31, 2011.

Total revenues, consisting of net interest and dividend income plus noninterest income, were $2,968,000 in the first quarter compared to $2,856,000 a year ago, an increase of 4%. Noninterest income increased by $141,000, or 39%. This was driven by an increase of $107,000 in gains on sales of securities, a $47,000 increase in gains on loans sold, and a $42,000 increase in investment services income.

The Companya™s taxable-equivalent net interest margin (taxable-equivalent net interest and dividend income divided by average earning assets) was 3.32% for the first quarter of 2011, compared to 3.88% for the first quarter of 2010. While funding costs declined by 18 basis points, yield on earning assets also declined due to lower yields on loans and investments.

Total non-interest expenses for the first quarter were $2,652,000, an increase of $331,000 or 14% over the first quarter of 2010. The majority of this increase was in salaries and employee benefits due to the Companya™s strategic investment in mortgage lending staffing. Professional fees, data processing fees, and premises and equipment expenses all declined in the first quarter of 2011 compared to the first quarter of 2010.

In January of 2011, Simsbury Bank & Trust Company formed a subsidiary Passive Investment Company (PIC). Under State of Connecticut statutes, such a company is not subject to Connecticut corporation business tax. Provided that statutory requirements and certain other conditions are met, the current annual benefit to net income of establishing the PIC should exceed $100,000. This benefit may adjust upward or downward as the Banka™s net income changes over time. First quarter 2011 net income was negatively impacted by certain non-recurring tax charges incurred in establishing the PIC, net of a favorable federal tax adjustment, resulting in a $172,000 one-time net charge reflected in the Companya™s income tax provision.

aWe will continue to focus on serving our current and new customers very well and thereby earning more of their business,a said SBT Bancorp President and CEO, Martin J. Geitz. aOur customer focus remains the foundation of our success as it enables us to build shareholder value with an attractive, low-cost, relationship based deposit mix; a relatively low-risk mortgage, consumer and commercial loan portfolio; and a strong capital position.a

Capital levels for the Simsbury Bank & Trust Company on March 31, 2011 were above those required to meet the regulatory awell-capitalizeda designation.

Simsbury Bank is an independent, local bank for consumers and businesses. The Bank has approximately $325 million in assets. The Bank serves customers through full-service offices in Avon, Bloomfield, Granby and Simsbury, Connecticut; loan originators throughout central Connecticut, a loan production office and ATM in Canton, Connecticut; SBT Online internet banking at simsburybank.com; free ATM transactions at hundreds of machines throughout the northeastern U.S. via the SUM program; and 24 hour telephone banking. The Banka™s wholly-owned subsidiary, SBT Investment Services, Inc., offers securities and insurance products through LPL Financial and its affiliates, Member FINRA/SIPC. Simsbury Bank is wholly- owned by publicly traded SBT Bancorp, Inc. Its stock is traded over-the-counter under the ticker symbol of OTCBB: SBTB. For more information, visit [ www.simsburybank.com ].

Certain statements in this press release, including statements regarding the intent, belief or current expectations of SBT Bancorp, Inc., The Simsbury Bank & Trust Company, or their directors or officers, are aforward-lookinga statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.