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Section 1: 8-K (8-K)

8-K 3Q2016 Earnings Release

 UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON,  D.C. 20549 



FORM 8-K



CURRENT REPORT



Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934





 

 

 

Date of Report (Date of Earliest Event Reported):

 

October  20, 2016

 


 

DNB Financial Corporation

__________________________________________

(Exact name of registrant as specified in its charter)



Pennsylvania 

1-34242

23-2222567

 

_____________________

(State or other jurisdiction

_____________

(Commission

______________

(I.R.S. Employer

 

of incorporation)

File Number)

Identification No.)

 

   

 

 

 

4 Brandywine Avenue,  Downingtown,  Pennsylvania 

 

19335

 

_________________________________

(Address of principal executive offices)

 

___________

(Zip Code)

 



 

Registrant’s telephone number, including area code:

 

(610) 269-1040

 





Not Applicable

______________________________________________

Former name or former address, if changed since last report



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:



[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))






 


 

Item 2.02. Results of Operations and Financial Condition.



On October 20, 2016, DNB Financial Corporation issued a press release discussing the Company's Third Quarter 2016 results. The press release, attached as Exhibit 99.1 hereto and incorporated herein by reference, is being furnished to the SEC and shall not be deemed to be "filed" for any purpose.



Item 8.01. Other Events



The information in Item 2.02 is incorporated into this Item 8.01 by reference.



Item 9.01. Financial Statements and Exhibits.



(c) Exhibits. The following exhibit is furnished herewith:



99.1 Press Release, dated October 20, 2016 of DNB Financial Corporation








 





SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



 

DNB Financial Corporation

   

 

October 20, 2016

By:

/s/ Gerald F. Sopp

   

 

Name: Gerald F. Sopp

 

 

Title: Chief Financial Officer and Executive Vice President



 










 

Exhibit Index



Exhibit No.

 

Description

 

99.1

 

Press Release dated October 20, 2016 of DNB Financial Corporation

 

 




(Back To Top)

Section 2: EX-99.1 (EX-99.1)

Earnings Release 3Q'16

DNB Financial Corporation



DNB_Financial-4c_rev





For further information, please contact:

Gerald F. Sopp CFO/Executive Vice-President

484.359.3138FOR IMMEDIATE RELEASE 

gsopp@dnbfirst.com (NasdaqCM: DNBF)

DNB Financial Corporation Reports Third Quarter 2016 Results

Downingtown PA., October 20, 2016 (GLOBENEWSWIRE)– DNB Financial Corporation (Nasdaq: DNBF), today reported net income available to common stockholders in accordance with generally accepted accounting principles (“GAAP”) of $1,000, or less than a penny per diluted share, for the quarter ending September 30, 2016, compared with $1.3 million, or $0.44 per diluted share, for the same quarter, last year. For the nine months ending September 30, 2016, net income available to common shareholders was $2.7 million, or $0.93 per diluted share, compared with $3.7 million, or $1.31 per diluted share for the corresponding prior year period.

DNB Financial Corporation (the “Company” or “DNB”) is the parent of DNB First, National Association, one of the first nationally-chartered community banks to serve the greater Philadelphia region.

On a core basis, the Company reported net income available to common stockholders of $1.2 million, or $0.42 per diluted share, for the quarter ending September 30, 2016 compared with $1.3 million, or $0.44 per diluted share, for the corresponding prior year period. Core earnings, which is a non-GAAP measure of net income, excludes merger-related expenses of $1.5 million, gains from insurance proceeds of $30,000, and an associated income tax adjustment of $259,000 for the three months ending September 30, 2016. Core earnings were $3.7 million, or $1.29 per diluted share, for the nine months ending September 30, 2016, compared with $3.7 million, or $1.31 per diluted share, for the same period, last year. Please see the Reconciliation of Non-GAAP Financial Measures on page 6 of the release. Non-GAAP financial measures include references to the terms “core” or “operating”.

William J. Hieb, President and CEO, commented, "Third quarter results represent good operating trends, which reflect our steadfast commitment to disciplined banking. We are particularly pleased with our solid loan and core deposit growth, continued stable credit quality, and wealth management business. On October 1, 2016, we successfully completed the acquisition of East River Bank and we are excited about the opportunities this combination provides us to grow our customer relationships in southeastern Pennsylvania.”

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Highlights

·

Total loans increased 8.3% on a year-over-year basis and 3.0% (not annualized) on a sequential quarter basis. Total growth for the third quarter of 2016 was primarily due to stronger demand for commercial real estate loans and consumer loans.

·

Core deposits increased 5.8% and 1.0% (not annualized) on a year-over-year basis and sequential quarter basis, respectively. As of September 30, 2016, core deposits were 85.3% of total deposits.

·

Asset quality remained stable. Net loan charge-offs were only 0.03% (annualized) of total average loans for the third quarter of 2016, and non-performing loans were 1.36% of total loans at quarter-end.

·

Wealth management assets under care increased 10.1% (not annualized) to $210.8 million as of September 30, 2016, from $191.5 million as of December 31, 2015. 

·

On October 1, 2016, the Company completed its acquisition of Philadelphia-based East River Bank. The combination of the two companies will have total assets, loans, and deposits of approximately $1.1 billion, $764 million, and $841 million, respectively, with 15 offices in Chester, Delaware and Philadelphia counties.

·

The Company paid a quarterly cash dividend of $0.07 on September 20, 2016. 

Income Statement Summary

Based on core earnings of $1.2 million, the Company’s performance for the quarter ending September 30, 2016 generated a return on average assets (“ROAA”) and return on average tangible common equity (“ROTCE”) of 0.63% and 7.98%, respectively. The core ROAA and ROTCE were 0.68% and 8.75%, respectively, for the same quarter, last year. Please see the “Reconciliation of Non-GAAP Financial Measures” on page 6 of the release.

Total interest income for the three months ending September 30, 2016 was $6.3 million, which represented a $97,000 increase from the quarter ending June 30, 2016, and a $116,000 increase for the three months ending September 30, 2015. The year-over-year increase was primarily due to a 6.1% rise in total average loans, which offset a seven basis point decline in the net interest margin. On a sequential quarter basis, total average loans increased $10.2 million, or 2.1% (not annualized). The weighted average yield on total interest-earning assets was 3.47% for the quarter ending September 30, 2016, compared with 3.46% for the previous quarter.

Total interest expense increased $52,000 to $760,000 for the third quarter of 2016 from $708,000 for the second quarter of 2016. The sequential quarter increase was primarily due to a two basis point rise in the weighted average cost of interest-bearing liabilities to 0.43%. The increase was the result of a $13.6 million increase in the average Money Market account balances due to a special interest rate promotion during the quarter, offset in part by a $15.6 million decrease in average NOW account balances. Total interest expense also went up $49,000, compared with the three months ending September 30, 2015. The year-over-year increase was primarily due to a higher amount of interest-bearing liabilities as the weighted average cost of funds was 0.42%, for the same quarter, last year.

On both a year-over-year and sequential quarter basis, the net interest margin remained relatively stable despite continuing pressure from ultra-low interest rates and the flattening yield curve. The net interest

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margin was 3.06% for the third quarter of 2016, compared with 3.13% for the same quarter, last year. On a sequential quarter basis, the net interest margin slipped only two basis points from 3.08% for the three months ending June 30, 2016. 

The loan loss provision was $100,000 for both the most recent quarter and the three months ended September 30, 2015. Net loan charge-offs were only $44,000, or 0.03% (annualized) of total average loans, for the September 30, 2016 quarter. As of September 30, 2016, the Company’s allowance for credit losses was $5.3 million and represented 1.04% of total loans.

Total non-interest income for the third quarter of 2016 was $1.4 million, compared with $1.4 million for the prior quarter and $1.0 million for the quarter ended September 30, 2015. Total non-interest income for the third quarter of 2016 included a $30,000 gain from the insurance proceeds associated with the fire at our West Chester location. Wealth management fees were $393,000 for the third quarter of 2016 compared with $440,000 for the second quarter of 2016, and $317,000 for the quarter ending September 30, 2015. Wealth management fees represented approximately one-third of total fee income. Gains from the sale of investment securities were $197,000 for the three months ending September 30, 2016, compared with $203,000 for the quarter ending June 30, 2016, and $10,000 for the quarter ended September 30, 2015.

Non-interest expense was $6.7 million for the third quarter of 2016, compared with $5.2 million for the second quarter of 2016, and $4.8 million for the quarter ending September 30, 2015. Non-interest expense for the quarter ending September 30, 2016 included merger-related costs of $1.5 million associated with East River Bank. Excluding these items, non-interest expense was $5.2 million for the quarter ending September 30, 2016. On a sequential quarter basis, salary and employee benefits expense increased $124,000, or 4.6% (not annualized), primarily due to new hires and incentives. Occupancy and equipment increased $136,000, or 16.8% (not annualized), largely due to the West Chester branch office being reopened following a fire, which occurred in the second quarter of 2015. Rent and depreciation expense had been suspended since that time. Please see the Reconciliation of Non-GAAP Financial Measures on page 6 of the release.

Balance Sheet Summary

As of September 30, 2016, total assets were $770.3 million compared with $748.8 million as of December 31, 2015. On a sequential quarter basis, total assets increased $6.1 million, or 0.80% (not annualized), as loan growth was offset by a decrease in investment securities. Total deposits increased $3.7 million, or 0.58% (not annualized), on a sequential quarter basis. As of September 30, 2016, total shareholders’ equity was $59.2 million, compared with $55.5 million as of December 31, 2015. Tangible book value per share was $20.73 as of September 30, 2016 compared with $19.58 as of December 31, 2015.

On a sequential quarter basis, total loans increased $15.1 million, or 3.0% (not annualized), to $509.5 million as of September 30, 2016. As of the same date, total loans were 66.1% of total assets. The loan growth occurred primarily in the commercial real estate and consumer loan categories. The Company remains disciplined and intends to maintain conservative underwriting standards while growing commercial-oriented loans in a competitive market.

On a sequential quarter basis, total core deposits increased $5.5 million to $550.3 million and were 85.2% of total deposits as of September 30, 2016. Total deposits were $645.5 million as of September 30, 2016, compared with $606.3 million as of December 31, 2015.

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Capital ratios continue to exceed regulatory standards for well capitalized institutions. As of September 30, 2016, the common equity tier 1 ratio was 10.50%, the tier 1 leverage ratio was 9.1%, the tier 1 risk-based capital ratio was 12.1%, and the total risk-based capital ratio was 14.7%. As of the same date, the tangible equity-to-tangible assets ratio was 7.7%. 

Asset Quality Summary

Asset quality remained solid as net charge-offs were only 0.03% of total average loans for the quarter ending September 30, 2016, compared with 0.10% for the quarter ending June 30, 2016, and 0.41% for the quarter ending September 30, 2015. Total non-performing assets, including loans and other real estate property, were $9.9 million as of September 30, 2016, compared with $10.5 million as of June 30, 2016 and $7.7 million as of December 31, 2015. The ratio of non-performing loans to total loans was 1.36% as of September 30, 2016, compared with 1.54% as of June 30, 2016. As of September 30, 2016, the allowance for credit losses to total loans ratio was 1.04%.

Interest Rate Risk Management

DNB's strategy has been to seek shorter duration over yield in its lending and investing activities and lengthen duration over rate in its financing activities to minimize interest rate risk. The Company also strives to offer products and services that develop strong relationships to retain core deposits. The Bank has an Asset Liability Management Committee that actively monitors and manages the bank's interest rate exposure using simulation models and gap analysis. The Committee's primary objective is to minimize the adverse impact of changes in interest rates on net interest income, while maximizing earnings. To date, model results indicate that interest rate risk remains moderate and within policy guidelines. 

General Information



DNB Financial Corporation is a bank holding company whose bank subsidiary, DNB First, National Association, is a community bank headquartered in Downingtown, Pennsylvania with 15 locations. DNB First, which was founded in 1860, provides a broad array of consumer and business banking products, and offers brokerage and insurance services through DNB Investments & Insurance, and investment management services through DNB Investment Management & Trust. DNB Financial Corporation's shares are traded on NASDAQ’s Capital Market under the symbol: DNBF. We invite our customers and shareholders to visit our website at https://www.dnbfirst.com. DNB's Investor Relations site can be found at http://investors.dnbfirst.com/.



Forward-Looking Statements



This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, expectations or predictions of future financial or business performance, conditions relating to DNB and East River Bank (“East River”) or other effects of the merger of DNB and East River. These forward-looking statements include statements with respect to DNB’s beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, that are subject to significant risks and uncertainties, and are subject to change based on various factors (some of which are beyond DNB’s control). The words "may," "could," "should," "would," "will," "believe," "anticipate," "estimate," "expect," "intend," "plan" and similar expressions are intended to identify forward-looking statements.



In addition to factors previously disclosed in the reports filed by DNB with the Securities and Exchange Commission (the “SEC”) and those identified elsewhere in this document, the following factors, among

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others, could cause actual results to differ materially from forward looking statements or historical performance: difficulties and delays in integrating the East River business or fully realizing anticipated cost savings and other benefits of the merger; business disruptions following the merger; the strength of the United States economy in general and the strength of the local economies in which DNB and East River conduct their operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; the downgrade, and any future downgrades, in the credit rating of the U.S. Government and federal agencies; inflation, interest rate, market and monetary fluctuations; the timely development of and acceptance of new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; the willingness of users to substitute competitors’ products and services for DNB’s products and services; the success of DNB in gaining regulatory approval of its products and services, when required; the impact of changes in laws and regulations applicable to financial institutions (including laws concerning taxes, banking, securities and insurance); technological changes; additional acquisitions; changes in consumer spending and saving habits; the nature, extent, and timing of governmental actions and reforms; and the success of DNB at managing the risks involved in the foregoing. Annualized, pro forma, projected and estimated numbers presented herein are presented for illustrative purpose only, are not forecasts and may not reflect actual results.



DNB cautions that the foregoing list of important factors is not exclusive. Readers are also cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date of this press release, even if subsequently made available by DNB on its website or otherwise. DNB does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of DNB to reflect events or circumstances occurring after the date of this press release.



For a complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review our filings with the SEC, including our most recent annual report on Form 10-K, as supplemented by our quarterly or other reports subsequently filed with the SEC.





FINANCIAL TABLES FOLLOW

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DNB Financial Corporation

Condensed Consolidated Statements of Income (Unaudited)

(Dollars in thousands, except per share data)



 

 

 

 

 

 

 

 

 

 

 



Three Months Ended

 

Nine Months Ended



September 30,

 

September 30,



 

2016

 

 

2015

 

 

2016

 

 

2015

 EARNINGS:

 

 

 

 

 

 

 

 

 

 

 

 Interest income

$

6,277 

 

$

6,161 

 

$

18,562 

 

$

18,288 

 Interest expense

 

760 

 

 

711 

 

 

2,118 

 

 

1,995 

 Net interest income

 

5,517 

 

 

5,450 

 

 

16,444 

 

 

16,293 

 Provision for credit losses

 

100 

 

 

100 

 

 

630 

 

 

815 

 Non-interest income

 

1,142 

 

 

1,027 

 

 

3,435 

 

 

3,220 

 Gain from insurance proceeds

 

30 

 

 

 -

 

 

1,180 

 

 

 -

 Gain on sale of investment securities

 

197 

 

 

10 

 

 

431 

 

 

74 

 Gain (loss) on sale of SBA loans

 

 -

 

 

 -

 

 

39 

 

 

416 

 Loss on sale / writedown of OREO and ORA

 

160 

 

 

154 

 

 

164 

 

 

154 

 Due diligence & merger expense

 

1,498 

 

 

 -

 

 

1,961 

 

 

 -

 Non-interest expense

 

5,046 

 

 

4,605 

 

 

15,169 

 

 

14,153 

 Income before income taxes

 

82 

 

 

1,628 

 

 

3,605 

 

 

4,881 

 Income tax expense

 

81 

 

 

359 

 

 

939 

 

 

1,125 

 Net income

 

 

 

1,269 

 

 

2,666 

 

 

3,756 

 Preferred stock dividends

 

 -

 

 

 

 

 -

 

 

42 

 Net income available to common stockholders

$

 

$

1,261 

 

$

2,666 

 

$

3,714 

 Net income per common share, diluted

$

0.00 

 

$

0.44 

 

$

0.93 

 

$

1.31 



 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measures (Unaudited)

(Dollars in thousands, except per share data)



 

 

 

 

 

 

 

 

 

 

 



Three Months Ended

 

Nine Months Ended

   

September 30,

 

September 30,

   

 

2016

 

 

2015

 

 

2016

 

 

2015

   

 

 

 

 

 

 

 

 

 

 

 

 GAAP net income

$

 

$

1,261 

 

$

2,666 

 

$

3,714 

 Gains from insurance proceeds

 

(30)

 

 

 -

 

 

(1,180)

 

 

 -

 Salary expense related to restricted stock and SERP

 

 -

 

 

 -

 

 

446 

 

 

 -

 Due diligence & merger expense

 

1,498 

 

 

 -

 

 

1,961 

 

 

 -

 Income tax adjustment

 

(259)

 

 

 -

 

 

(177)

 

 

 -

 Non-GAAP net income (Core earnings)

$

1,210 

 

$

1,261 

 

$

3,716 

 

$

3,714 



 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

Basic

$

0.42 

 

$

0.45 

 

$

1.31 

 

$

1.33 

Diluted

$

0.42 

 

$

0.44 

 

$

1.29 

 

$

1.31 



 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

2,853 

 

 

2,807 

 

 

2,845 

 

 

2,798 

Diluted

 

2,886 

 

 

2,852 

 

 

2,879 

 

 

2,844 



 

 

 

 

 

 

 

 

 

 

 



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DNB Financial Corporation

Selected Financial Data (Unaudited)

(Dollars in thousands, except per share data)



 

 

 

 

 

 

 

 

 

 

 

 

 

 



Quarterly



2016

 

2016

 

2016

 

2015

 

2015



3rd Qtr

 

2nd Qtr

 

1st Qtr

 

4th Qtr

 

3rd Qtr

Earnings and Per Share Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Net income available to common stockholders

$

 

$

1,109 

 

$

1,556 

 

$

1,374 

 

$

1,261 

 Basic earnings per common share

$

0.00 

 

$

0.39 

 

$

0.55 

 

$

0.49 

 

$

0.45 

 Diluted earnings per common share

$

0.00 

 

$

0.39 

 

$

0.54 

 

$

0.48 

 

$

0.44 

 Dividends per common share

$

0.07 

 

$

0.07 

 

$

0.07 

 

$

0.07 

 

$

0.07 

 Book value per common share

$

20.76 

 

$

20.90 

 

$

20.45 

 

$

19.65 

 

$

19.64 

 Tangible book value per common share

$

20.73 

 

$

20.88 

 

$

20.38 

 

$

19.58 

 

$

19.57 

 Average common shares outstanding

 

2,853 

 

 

2,849 

 

 

2,833 

 

 

2,812 

 

 

2,807 

 Average diluted common shares outstanding

 

2,886 

 

 

2,883 

 

 

2,869 

 

 

2,857 

 

 

2,852 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performance Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Return on average assets

 

0.00% 

 

 

0.59% 

 

 

0.84% 

 

 

0.74% 

 

 

0.68% 

 Return on average equity

 

0.01% 

 

 

7.56% 

 

 

10.94% 

 

 

9.32% 

 

 

8.71% 

 Return on average tangible equity

 

0.01% 

 

 

7.57% 

 

 

10.98% 

 

 

9.35% 

 

 

8.75% 

 Net interest margin

 

3.06% 

 

 

3.08% 

 

 

3.15% 

 

 

3.14% 

 

 

3.13% 

 Efficiency ratio

 

94.43% 

 

 

74.38% 

 

 

78.66% 

 

 

68.27% 

 

 

68.09% 

 Wtd average yield on earning assets

 

3.47% 

 

 

3.46% 

 

 

3.51% 

 

 

3.53% 

 

 

3.52% 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Quality Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Net charge-offs (recoveries) to average loans

 

0.03% 

 

 

0.10% 

 

 

0.08% 

 

 

0.07% 

 

 

0.41% 

 Non-performing loans/Total loans

 

1.36% 

 

 

1.54% 

 

 

1.06% 

 

 

1.06% 

 

 

0.90% 

 Non-performing assets/Total assets

 

1.28% 

 

 

1.38% 

 

 

1.02% 

 

 

1.02% 

 

 

0.87% 

 Allowance for credit loss/Total loans

 

1.04% 

 

 

1.06% 

 

 

1.06% 

 

 

1.02% 

 

 

1.01% 

 Allowance for credit loss/Non-performing loans

 

76.28% 

 

 

69.12% 

 

 

99.64% 

 

 

96.91% 

 

 

111.32% 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Total equity/Total assets

 

7.69% 

 

 

7.79% 

 

 

7.64% 

 

 

7.41% 

 

 

7.87% 

 Tangible equity/Tangible assets

 

7.68% 

 

 

7.78% 

 

 

7.61% 

 

 

7.40% 

 

 

7.42% 

 Tier 1 leverage ratio

 

9.06% 

 

 

9.11% 

 

 

9.16% 

 

 

8.94% 

 

 

9.23% 

 Common equity tier 1 risk-based capital ratio

 

10.50% 

 

 

10.82% 

 

 

10.71% 

 

 

10.44% 

 

 

10.46% 

 Tier 1 risk-based capital ratio

 

12.06% 

 

 

12.43% 

 

 

12.34% 

 

 

12.08% 

 

 

12.74% 

 Total risk-based capital ratio

 

14.72% 

 

 

15.16% 

 

 

15.07% 

 

 

14.78% 

 

 

15.46% 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wealth Management

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Assets under care*

$

210,800 

 

$

200,586 

 

$

199,296 

 

$

191,529 

 

$

184,535 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

*Wealth Management assets under care includes assets under management, administration, supervision and brokerage.



 

 

 

 

 

 

 

 

 

 

 

 

 

 



7

 


 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DNB Financial Corporation

 

Condensed Consolidated Statements of Income (Unaudited)

 

(Dollars in thousands, except per share data)

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



Three Months Ended

 



Sept 30,

 

June 30,

 

Mar 31,

 

Dec 31,

 

Sept 30,

 



2016

 

2016

 

2016

 

2015

 

2015

 

 EARNINGS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Interest income

$

6,277 

 

$

6,180 

 

$

6,105 

 

$

6,190 

 

$

6,161 

 

 Interest expense

 

760 

 

 

708 

 

 

650 

 

 

717 

 

 

711 

 

 Net interest income

 

5,517 

 

 

5,472 

 

 

5,455 

 

 

5,473 

 

 

5,450 

 

 Provision for loan losses

 

100 

 

 

200 

 

 

330 

 

 

290 

 

 

100 

 

 Non-interest income

 

1,142 

 

 

1,184 

 

 

1,109 

 

 

1,107 

 

 

1,027 

 

 Gain from insurance proceeds

 

30 

 

 

 -

 

 

1,150 

 

 

120 

 

 

 -

 

 Gain on sale of investment securities

 

197 

 

 

203 

 

 

31 

 

 

 

 

10 

 

 Gain on sale of SBA loans

 

 -

 

 

 -

 

 

39 

 

 

68 

 

 

 -

 

 (Gain) loss on sale / write-down of OREO and ORA

 

160 

 

 

 

 

 -

 

 

(20)

 

 

154 

 

 Due diligence & merger expense

 

1,498 

 

 

275 

 

 

188 

 

 

 -

 

 

 -

 

 Non-interest expense

 

5,046 

 

 

4,893 

 

 

5,230 

 

 

4,742 

 

 

4,605 

 

 Income before income taxes

 

82 

 

 

1,487 

 

 

2,036 

 

 

1,760 

 

 

1,628 

 

 Income tax expense

 

81 

 

 

378 

 

 

480 

 

 

378 

 

 

359 

 

 Net income

 

 

 

1,109 

 

 

1,556 

 

 

1,382 

 

 

1,269 

 

 Preferred stock dividends

 

 -

 

 

 -

 

 

 -

 

 

 

 

 

 Net income available to common stockholders

$

 

$

1,109 

 

$

1,556 

 

$

1,374 

 

$

1,261 

 

 Net income per common share, diluted

$

0.00 

 

$

0.39 

 

$

0.54 

 

$

0.48 

 

$

0.44 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Financial Condition (Unaudited)

 

(Dollars in thousands)

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



Sept 30,

 

June 30,

 

Mar 31,

 

Dec 31,

 

Sept 30,

 



2016

 

2016

 

2016

 

2015

 

2015

 

 FINANCIAL POSITION:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Cash and cash equivalents

$

30,442 

 

$

20,146 

 

$

38,740 

 

$

21,119 

 

$

18,959 

 

 Investment securities

 

195,477 

 

 

223,140 

 

 

207,023 

 

 

220,208 

 

 

227,363 

 

 Loans held for sale

 

 -

 

 

 -

 

 

359 

 

 

 -

 

 

 -

 

 Loans and leases

 

509,475 

 

 

494,417 

 

 

489,366 

 

 

481,758 

 

 

470,396 

 

 Allowance for credit losses

 

(5,303)

 

 

(5,247)

 

 

(5,172)

 

 

(4,935)

 

 

(4,729)

 

 Net loans and leases

 

504,172 

 

 

489,170 

 

 

484,194 

 

 

476,823 

 

 

465,667 

 

 Premises and equipment, net

 

9,033 

 

 

8,557 

 

 

7,817 

 

 

6,806 

 

 

6,630 

 

 Other assets

 

31,148 

 

 

23,159 

 

 

23,307 

 

 

23,862 

 

 

23,272 

 

 Total assets

$

770,272 

 

$

764,172 

 

$

761,440 

 

$

748,818 

 

$

741,891 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Demand Deposits

$

146,731 

 

$

135,212 

 

$

131,951 

 

$

125,581 

 

$

120,018 

 

 NOW

 

169,400 

 

 

185,279 

 

 

201,566 

 

 

185,973 

 

 

189,502 

 

 Money markets

 

160,312 

 

 

149,108 

 

 

138,241 

 

 

137,555 

 

 

139,213 

 

 Savings

 

73,867 

 

 

75,236 

 

 

75,535 

 

 

72,660 

 

 

71,316 

 

 Core Deposits

 

550,310 

 

 

544,835 

 

 

547,293 

 

 

521,769 

 

 

520,049 

 

 Time deposits

 

71,920 

 

 

73,560 

 

 

71,264 

 

 

66,018 

 

 

69,744 

 

 Brokered deposits

 

23,313 

 

 

23,449 

 

 

18,498 

 

 

18,488 

 

 

18,665 

 

 Total Deposits

 

645,543 

 

 

641,844 

 

 

637,055 

 

 

606,275 

 

 

608,458 

 

 FHLB advances

 

20,000 

 

 

20,000 

 

 

20,000 

 

 

30,000 

 

 

20,000 

 

 Repurchase agreements

 

19,483 

 

 

17,748 

 

 

21,661 

 

 

32,416 

 

 

30,501 

 

 Subordinated Debt

 

9,750 

 

 

9,750 

 

 

9,750 

 

 

9,750 

 

 

9,750 

 

 Other borrowings

 

9,710 

 

 

9,721 

 

 

9,733 

 

 

9,743 

 

 

9,754 

 

 Other liabilities

 

6,569 

 

 

5,572 

 

 

5,061 

 

 

5,146 

 

 

5,060 

 

 Stockholders' equity

 

59,217 

 

 

59,537 

 

 

58,180 

 

 

55,488 

 

 

58,368 

 

 Total liabilities and stockholders' equity

$

770,272 

 

$

764,172 

 

$

761,440 

 

$

748,818 

 

$

741,891 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



8

 


 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DNB Financial Corporation

Condensed Consolidated Statements of Financial Condition - Quarterly Average Balances (Unaudited)

(Dollars in thousands)



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

Sept 30,

 

 

June 30,

 

 

Mar 31,

 

 

Dec 31,

 

 

Sept 30,

 



 

2016

 

 

2016

 

 

2016

 

 

2015

 

 

2015

 

 FINANCIAL POSITION:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Cash and cash equivalents

$

25,208 

 

$

36,113 

 

$

23,080 

 

$

19,532 

 

$

19,820 

 

 Investment securities

 

217,593 

 

 

213,235 

 

 

215,565 

 

 

227,936 

 

 

230,402 

 

 Loans held for sale

 

87 

 

 

147 

 

 

28 

 

 

61 

 

 

74 

 

 Loans and leases

 

498,627 

 

 

488,396 

 

 

483,125 

 

 

473,643 

 

 

469,896 

 

 Allowance for credit losses

 

(5,344)

 

 

(5,265)

 

 

(5,025)

 

 

(4,831)

 

 

(5,182)

 

 Net loans and leases

 

493,283 

 

 

483,131 

 

 

478,100 

 

 

468,812 

 

 

464,714 

 

 Premises and equipment, net

 

8,844 

 

 

8,332 

 

 

7,222 

 

 

6,609 

 

 

6,587 

 

 Other assets

 

19,829 

 

 

19,222 

 

 

19,678 

 

 

19,415 

 

 

20,021 

 

 Total assets

$

764,844 

 

$

760,180 

 

$

743,673 

 

$

742,365 

 

$

741,618 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Demand Deposits

$

137,437 

 

$

131,134 

 

$

120,391 

 

$

122,235 

 

$

118,282 

 

 NOW

 

176,704 

 

 

192,339 

 

 

193,548 

 

 

183,129 

 

 

197,802 

 

 Money markets

 

156,412 

 

 

142,768 

 

 

137,121 

 

 

140,136 

 

 

144,115 

 

 Savings

 

74,652 

 

 

75,254 

 

 

74,653 

 

 

71,637 

 

 

71,740 

 

 Core Deposits

 

545,205 

 

 

541,495 

 

 

525,713 

 

 

517,137 

 

 

531,939 

 

 Time deposits

 

72,324 

 

 

75,541 

 

 

70,927 

 

 

68,731 

 

 

56,702 

 

 Brokered deposits

 

23,307 

 

 

20,754 

 

 

18,491 

 

 

18,638 

 

 

18,658 

 

 Total Deposits

 

640,836 

 

 

637,790 

 

 

615,131 

 

 

604,506 

 

 

607,299 

 

 FHLB advances

 

20,000 

 

 

20,003 

 

 

23,111 

 

 

22,391 

 

 

20,000 

 

 Repurchase agreements

 

18,381 

 

 

19,103 

 

 

23,040 

 

 

31,914 

 

 

31,732 

 

 Subordinated Debt

 

9,750 

 

 

9,750 

 

 

9,750 

 

 

9,750 

 

 

9,750 

 

 Other borrowings

 

10,383 

 

 

9,728 

 

 

10,783 

 

 

9,875 

 

 

10,000 

 

 Other liabilities

 

5,367 

 

 

4,939 

 

 

4,818 

 

 

5,070 

 

 

5,073 

 

 Stockholders' equity

 

60,127 

 

 

58,867 

 

 

57,040 

 

 

58,859 

 

 

57,764 

 

 Total liabilities and stockholders' equity

$

764,844 

 

$

760,180 

 

$

743,673 

 

$

742,365 

 

$

741,618 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



9

 


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