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BancTrust Financial Group, Inc. Reports First Quarter Results

^{Published on 2011-04-22 11:11:03 - Market Wire}
 

MOBILE, Ala.--([ BUSINESS WIRE ])--BancTrust Financial Group, Inc. (NASDAQ: BTFG) today reported its financial results for the quarter ended March 31, 2011. The Company reported that its first quarter 2011 net income, before the preferred dividend, was $1.0 million compared with net income, before the preferred dividend, of $1.1 million in the first quarter of 2010. Net income available to common shareholders was $251,000, or $0.01 per fully diluted share, for the first quarter of 2011 compared with $386,000, or $0.02 per fully diluted share, for the first quarter of 2010. The first quarter net income available to common shareholders was net of a preferred stock dividend of $769,000 in 2011 and $739,000 in 2010.

"These improvements in net interest revenue and operating costs were partially offset by higher costs related to non-performing loans and charge-offs, which we expect will continue to be a drag on earnings for the near term"

aBancTrust reported growth in net interest revenue and lower operating costs in the first quarter of 2011 compared with the first quarter of last year,a stated W.Bibb Lamar, Jr., President and Chief Executive Officer of BancTrust Financial Group, Inc. aThis was our seventh consecutive quarter of profitability and we are optimistic about signs of economic recovery. We are seeing increased loan demand and economic activity in Mobile, our largest market, and believe our gulf coast markets have stabilized since last year.

aThese improvements in net interest revenue and operating costs were partially offset by higher costs related to non-performing loans and charge-offs, which we expect will continue to be a drag on earnings for the near term,a continued Mr. Lamar. aWe continue to focus on improving loan quality and reducing non-performing assets and believe these efforts will be key drivers in improving BancTrusta™s future profitability.a

First Quarter Results

Net interest revenue rose 1.8% to $15.2 million in the first quarter of 2011 compared with $14.9 million in the first quarter of 2010. The increase was due primarily to an increase in average earning assets and a lower cost of funds compared with last year. BancTrusta™s net interest margin rose 10 basis points to 3.14% in the first quarter of 2011 comparedwith 3.04% in the fourth quarter of 2010 in part as a result of increased investment income. Quarterly average investments rose 18.3% to $477 million in the first quarter of 2011 compared with the fourth quarter of 2010. Net interest margin decreased 26 basis points from 3.40% in the first quarter of2010 compared with the first quarter of 2011 as a result of increased liquidity and lower yields on investment securities.

Total loans were $1.36 billion at March 31, 2011, compared with $1.45 billion at March 31, 2010. The decrease in loans since last year was due to soft loan demand in certain markets, the transfer of loans to other real estate and loan charge-offs.

The provision for loan losses increased to $3.5 million in the first quarter of 2011 compared with $2.9 million in the firstquarter of 2010. Net charge-offs were $5.7 million for the first quarter of 2011 compared with $963,000 in the first quarter of 2010 and $2.5million in the fourth quarter of 2010. The increase in charge-offs in the most recent quarter was due largely to a write down on a large development property to reflect current appraisals. The allowance for loan losses was 3.37% of total loans at March31,2011,compared with3.30% at March 31, 2010.

Deposits rose 8.9% to $1.9 billion at March 31, 2011, from $1.7 billion at March 31, 2010. BancTrusta™s liquidity remains strong as evidenced by $113.1 million in average overnight funds, up from $57.9 million in the first quarter of 2010.

Total non-interest revenue declined to $4.8 million in the first quarter of 2011 compared with $5.3 million in the first quarter of 2010, primarily because of lower service charges and securities gains. Since the first quarter of last year, service charges declined by 19.9% to $1.5 million. The reduction was due partially to lower overdraft fees resulting from increased use of debit cards which do not permit overdrafts. Debit card fees were $509,000 in the first quarter of 2011, compared to $402,000 in the first quarter of 2010. Securities gains were $484,000 in the first quarter of 2011 compared with $837,000 in the first quarter of 2010.

Total non-interest expense declined 1.8% to $15.4 million in the first quarter of 2011 compared with $15.7million in the prior year first quarter. Salary expense, net occupancy expense, intangible amortization and other real estate carrying costs all declined compared to the first quarter of last year. FDIC insurance rose 21.5% by virtue of higher rates and growth in deposits since the first quarter of 2010.

aThe decline in non-interest costs since last year highlights the progress we made in reducing our operating costs by consolidating certain operations,a stated Mr. Lamar. aWe remain focused on improving our operating efficiency and expect these efforts to yield positive results as we grow our bank in the future.a

BancTrusta™s pre-tax income was $1.1 million in the first quarter of 2011 compared with $1.7 million in the first quarter of 2010. Net income available to common shareholders was $251,000, or $0.01 per diluted share,for the first quarter of 2011 compared with $386,000, or $0.02 per diluted share, in the first quarter of 2010.

BancTrust was classified as awell-capitalizeda at the end of the first quarter 2011. Total risk-based capital was14.3% for the holding company and 15.5% for the bank, compared with a regulatory requirement of 10.0% for a well-capitalized institution and a minimum regulatory requirement of 8.0%. Tier 1 risk-based capital was 13.0%for the holding company and 14.3% for the bank, both measures significantly above the requirement of 6.0%for a well-capitalized institution and minimum regulatory requirement of 4.0%.

aBancTrust did not declare a dividend on the Companya™s common stock for the first quarter of 2011,a continued Mr. Lamar. aWe will continue to evaluate the payment of common cash dividendsin the future based on our earnings outlook, capital and the state of the economy. Our focus remains on preserving our capital base while the economy remains soft.a

About BancTrust Financial Group, Inc.

BancTrust Financial Group, Inc. is a registered bank holding company headquartered in Mobile, Alabama. The Company provides an array of traditional financial services through 41 bank offices in the southern two thirds ofAlabama and 9bank offices in northwest Florida. BancTrusta™s common stock is listed on the NASDAQ Global SelectMarket under the symbol [ BTFG ].

Additional information concerning BancTrust Financial Group can be accessed at [ www.banktrustonline.com ] by following the link to investor relations.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning and subject to the protection of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements canbe identified by the use of words such as aexpect,a amay,a acould,a aintend,a aproject,a ahope,a aschedule,a aoutlook,a aestimate,a aanticipate,a ashould,a awill,a aplan,a abelieve,a acontinue,a apredict,a acontemplatea and similarexpressions. Our ability to accurately project results or predict the future effects of our plans and strategies is inherently limited. Although we believe that the expectations reflected in our forward-looking statements are based onreasonable assumptions, actual results and performance could differ materially from those set forth in the forwardlooking statements. Our forward-looking statements are based on information presently available to management and are subjectto various risks and uncertainties, in addition to the inherent uncertainty of predictions, including, without limitation, risks that competitive pressures among depository and other financial institutions may increase significantly; changes in the interest rate environment may reduce margins; general economic conditions may be less favorable thanexpected, resulting in, among other things, a further deterioration in credit quality and/or a reduction in demand forcredit; legislative or regulatory changes, including changes in accounting standards and changes resulting from the recently enacted Emergency Economic Stabilization Act of 2008, American Recovery and Reinvestment Act of 2009, Dodd-Frank Wall Street Reform and Consumer Protection Act and programs enacted by the U. S. Treasury and BancTrusta™s regulators to address capital and liquidity concerns in the financial system, may adversely affect the businessin which BancTrust is engaged; BancTrust may be unable to obtain required shareholder or regulatory approvalor financing for any proposed acquisition or other strategic or capital raising transactions; costs or difficulties related tothe integration ofBancTrusta™s businesses may be greater than expected; deposit attrition, customer loss or revenue lossfollowing acquisitions may be greater than expected; competitors may have greater financial resources and developproducts that enable these competitors to compete more successfully than BancTrust can compete; the April2010 oil spill in the Gulf of Mexico may adversely affect our customers, the value of real estate collateral in our coastal markets, and our business and results of operations; and the other risks described in BancTrusta™s SEC reports andfilings under aCautionary Note Concerning Forward-Looking Statementsa and aRisk Factors.a You should not placeundue reliance on forward-looking statements, since the statements speak only as of the date that they are made. BancTrust has no obligation and does not undertake to publicly update, revise or correct any of its forward-looking statements after the date of this press release, or after the respective dates on which such statements otherwise are made, whether as a result of new information, future events or otherwise.