Britton & Koontz Capital Corp. (BKBK, Financial) filed Quarterly Report for the period ended 2009-08-06.
Britton & Koontz Capital Corporation is the holding company for Britton & Koontz First National Bank. The products and services offered by the Bank include personal and commercial checking accounts money market deposit accounts savings accounts and automated clearinghouse services. Britton & Koontz Capital Corp. has a market cap of $24.3 million; its shares were traded at around $11.45 with a P/E ratio of 7.6 and P/S ratio of 1. The dividend yield of Britton & Koontz Capital Corp. stocks is 6.3%. Britton & Koontz Capital Corp. had an annual average earning growth of 7.6% over the past 5 years.
Total assets decreased $11.8 million from $413.1 million at December 31, 2008, to $401.3 million at June 30, 2009. Cash and due from banks decreased $1.4 million to $5.6 million at June 30, 2009, from $7.0 million at December 31, 2008. The available-for-sale investment securities portfolio decreased from December 31, 2008, by $10.0 million to $101.8 million at June 30, 2009, primarily from monthly cash flows exceeding additional purchases. Total loans at June 30, 2009, decreased $745 thousand to $224.8 million since December 31, 2008. Other real estate owned, net increased $478 thousand over the same period. Since December 31, 2008, total deposits have decreased $4.9 million to $252.3 million at June 30, 2009. Total borrowings decreased $6.4 million over the same period as investment cash flows were used to pay down debt. Total stockholders equity increased $646 thousand to $40.2 million at June 30, 2009 from $39.5 million at December 31, 2008.
Management determines the classification of its securities at acquisition. Total held-to-maturity and available-for-sale securities decreased $10.5 million to $156.2 million at June 30, 2009. The decrease in securities was due to normal pay-downs of mortgage-backed securities and reinvestment calls of municipal securities offset by additional municipal security purchases. From time to time, the Company will prefund future cash flows that are expected from the current portfolio to take advantage of favorable interest rate spreads between the short-term funding and the investment securities purchased with such funding. Under this prefunding strategy, the Company obtains short-term funding, typically from the Federal Home Loan Bank (“FHLB”), to acquire investment securities and then uses the cash flows generated by such securities in the subsequent two to three quarters to repay the short-term funding. Due to the low interest rate environment during the second quarter of 2009, the Company was not able to utilize its prefunding strategy; as a result, the investment securities portfolio decreased. However, the Company has had limited success in pre-investing anticipated municipal securities that have been called. Equity securities, comprised primarily of Federal Reserve Bank stock of $522 thousand, FHLB stock of $2.9 million, the Company s investment in its statutory trust of $155 thousand and ECD Investments, LLC membership interests of $100 thousand, decreased $265 thousand due to the mandatory redemption of FHLB stock.
The Company has experienced some declines in certain asset quality measures since December 31, 2008. Nonperforming assets, which includes non-accrual loans, loans delinquent 90 days or more and other real estate, increased to $8.8 million, or 2.2% of total assets at June 30, 2009, from $5.0 million, or 1.2% of total assets at December 31, 2008. Approximately $4.0 million of the nonperforming assets are two non-accrual commercial real estate loans, both of which have been under formal forbearance agreements. The Company continues to closely monitor these loans and intends to take such actions as are necessary to limit any losses to the Company. Two additional commercial real estate relationships totaling $1.6 million were included in 90 day past due at the end of the second quarter. Both of these relationships have subsequently been renewed, each with a payment of all past due interest and one also with some reduction of principal. Net charge-offs of $383 thousand in the second quarter of 2009 resulted in net charge-offs of $515 thousand at June 30, 2009 compared to $202 thousand at June 30, 2008. A breakdown of nonperforming assets at June 30, 2009, and December 31, 2008, is shown below.
The provision for possible loan losses is a charge to earnings to maintain the allowance for possible loan losses at a level consistent with management s assessment of the loan portfolio in light of current and expected economic conditions. The Company s loan loss provision for the second quarter of 2009 was $250 thousand, as compared to $120 thousand for the second quarter of 2008. For the six month period ended June 30, 2009, the Company s provision for loan losses increased by $710 thousand to $950 thousand compared to the same period in 2008. The additional provision in the second quarter of 2009 as compared to the same period in 2008 was added primarily to address increased net charge-offs experienced during the six months ended June 30, 2009, compared to the same period in 2008. Net charge-offs of $383 thousand in the second quarter of 2009 resulted in net charge-offs of $515 thousand at June 30, 2009 compared to $202 thousand at June 30, 2008.
For the six months ended June 30, 2009, net interest income increased $690 thousand to $7.4 million compared to the same period in 2008. Average earning assets increased $31.5 million to $390.6 million which contributed a net $626 thousand toward the increase in net interest income. The lower interest rate environment also provided a positive impact in the first six months of 2009, as the interest rate spread increased 30 basis points, adding approximately $64 thousand to net interest income. Net interest margin increased from 3.76% to 3.81% for the same comparable periods.
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Britton & Koontz Capital Corporation is the holding company for Britton & Koontz First National Bank. The products and services offered by the Bank include personal and commercial checking accounts money market deposit accounts savings accounts and automated clearinghouse services. Britton & Koontz Capital Corp. has a market cap of $24.3 million; its shares were traded at around $11.45 with a P/E ratio of 7.6 and P/S ratio of 1. The dividend yield of Britton & Koontz Capital Corp. stocks is 6.3%. Britton & Koontz Capital Corp. had an annual average earning growth of 7.6% over the past 5 years.
Highlight of Business Operations:
The Company s net income for the three months ended June 30, 2009, was $758 thousand, or $0.36 per diluted share, compared to $848 thousand, or $0.40 per diluted share, for the quarter ended June 30, 2008. For the six month period ended June 30, 2009, net income was $1.4 million, or $0.64 per diluted share, compared to $1.7 million, or $0.80 per diluted share, for the same period in 2008.Total assets decreased $11.8 million from $413.1 million at December 31, 2008, to $401.3 million at June 30, 2009. Cash and due from banks decreased $1.4 million to $5.6 million at June 30, 2009, from $7.0 million at December 31, 2008. The available-for-sale investment securities portfolio decreased from December 31, 2008, by $10.0 million to $101.8 million at June 30, 2009, primarily from monthly cash flows exceeding additional purchases. Total loans at June 30, 2009, decreased $745 thousand to $224.8 million since December 31, 2008. Other real estate owned, net increased $478 thousand over the same period. Since December 31, 2008, total deposits have decreased $4.9 million to $252.3 million at June 30, 2009. Total borrowings decreased $6.4 million over the same period as investment cash flows were used to pay down debt. Total stockholders equity increased $646 thousand to $40.2 million at June 30, 2009 from $39.5 million at December 31, 2008.
Management determines the classification of its securities at acquisition. Total held-to-maturity and available-for-sale securities decreased $10.5 million to $156.2 million at June 30, 2009. The decrease in securities was due to normal pay-downs of mortgage-backed securities and reinvestment calls of municipal securities offset by additional municipal security purchases. From time to time, the Company will prefund future cash flows that are expected from the current portfolio to take advantage of favorable interest rate spreads between the short-term funding and the investment securities purchased with such funding. Under this prefunding strategy, the Company obtains short-term funding, typically from the Federal Home Loan Bank (“FHLB”), to acquire investment securities and then uses the cash flows generated by such securities in the subsequent two to three quarters to repay the short-term funding. Due to the low interest rate environment during the second quarter of 2009, the Company was not able to utilize its prefunding strategy; as a result, the investment securities portfolio decreased. However, the Company has had limited success in pre-investing anticipated municipal securities that have been called. Equity securities, comprised primarily of Federal Reserve Bank stock of $522 thousand, FHLB stock of $2.9 million, the Company s investment in its statutory trust of $155 thousand and ECD Investments, LLC membership interests of $100 thousand, decreased $265 thousand due to the mandatory redemption of FHLB stock.
The Company has experienced some declines in certain asset quality measures since December 31, 2008. Nonperforming assets, which includes non-accrual loans, loans delinquent 90 days or more and other real estate, increased to $8.8 million, or 2.2% of total assets at June 30, 2009, from $5.0 million, or 1.2% of total assets at December 31, 2008. Approximately $4.0 million of the nonperforming assets are two non-accrual commercial real estate loans, both of which have been under formal forbearance agreements. The Company continues to closely monitor these loans and intends to take such actions as are necessary to limit any losses to the Company. Two additional commercial real estate relationships totaling $1.6 million were included in 90 day past due at the end of the second quarter. Both of these relationships have subsequently been renewed, each with a payment of all past due interest and one also with some reduction of principal. Net charge-offs of $383 thousand in the second quarter of 2009 resulted in net charge-offs of $515 thousand at June 30, 2009 compared to $202 thousand at June 30, 2008. A breakdown of nonperforming assets at June 30, 2009, and December 31, 2008, is shown below.
The provision for possible loan losses is a charge to earnings to maintain the allowance for possible loan losses at a level consistent with management s assessment of the loan portfolio in light of current and expected economic conditions. The Company s loan loss provision for the second quarter of 2009 was $250 thousand, as compared to $120 thousand for the second quarter of 2008. For the six month period ended June 30, 2009, the Company s provision for loan losses increased by $710 thousand to $950 thousand compared to the same period in 2008. The additional provision in the second quarter of 2009 as compared to the same period in 2008 was added primarily to address increased net charge-offs experienced during the six months ended June 30, 2009, compared to the same period in 2008. Net charge-offs of $383 thousand in the second quarter of 2009 resulted in net charge-offs of $515 thousand at June 30, 2009 compared to $202 thousand at June 30, 2008.
For the six months ended June 30, 2009, net interest income increased $690 thousand to $7.4 million compared to the same period in 2008. Average earning assets increased $31.5 million to $390.6 million which contributed a net $626 thousand toward the increase in net interest income. The lower interest rate environment also provided a positive impact in the first six months of 2009, as the interest rate spread increased 30 basis points, adding approximately $64 thousand to net interest income. Net interest margin increased from 3.76% to 3.81% for the same comparable periods.
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