Earnings Grow 59% at South Atlantic Bancshares, Inc.
Staff Report From South Carolina CEO
Wednesday, April 24th, 2019
South Atlantic Bancshares, Inc., parent of South Atlantic Bank, today reported net income of $1.3 million or $0.17 per diluted share for the three months ended March 31, 2019, compared to $801 thousand or $0.13 per diluted share reported for the same period ended a year ago. Net income increased 59.06 percent from March 31, 2018 to March 31, 2019.
Financial Highlights
Return on average assets was 0.79 percent for the quarter ended March 31, 2019 compared to 0.62 percent for the quarter ended March 31, 2018 and 0.57 for year ended December 31, 2018.
The net interest margin, taxable equivalent, was 4.34 percent for the quarter ended March 31, 2019, a 27 basis point increase or 7 percent increase from a year ago and a 5 basis point increase compared to December 31, 2018.
Total loans grew 28.63 percent, from $428.9 million at March 31, 2018 to $551.7 million at March 31, 2019 and 3.89% compared to December 31, 2018.
Total deposits grew 23.09 percent, from $467.7 million at March 31, 2018 to $575.7 million at March 31, 2019 and 8.57 percent compared to December 31, 2018.
Total assets grew 27.66 percent, from $532.8 million at March 31, 2018 to $680.1 million at March 31, 2019 and 7.92 percent compared to December 31, 2018.
Asset quality continues to be a highlight with non-performing assets to average total assets of 0.09 percent as of the quarter ended March 31, 2019 and 0.09 percent for the year ended December 31, 2018.
"We've started the year strong, producing solid loan and deposit growth, and are pleased with our first quarter results. With the acquisition of Atlantic Bancshares, Inc. behind us, we expect continued net income growth and look forward to the rest of the year. Our efficiency ratio is at a good level with cost savings realized from the merger.
We are excited about opportunities in the Bluffton and Hilton Head Island markets along with the recent approval for a retail branch at our new operations center located west of the Intracoastal Waterway in the Towne Centre area of Carolina Forest," stated K. Wayne Wicker, chairman of the board and chief executive officer of the Company.
Net Interest Income and Net Interest Margin
Net interest income to average assets was 3.98 percent for the quarter ended March 31, 2019 compared to 3.75 percent for the same period ended in 2018. Net interest income totaled $6.4 million for the quarter ended March 31, 2019 compared to $4.8 million for the same period ended March 31, 2018. Net interest margin, taxable equivalent, increased from 4.07 percent at March 31, 2018 to 4.34 percent at March 31, 2019. Increases in net interest income and net interest margin are attributed primarily to loan growth and interest rate increases on new and refinanced loans.
Noninterest Income and Expense
Noninterest income totaled $875 thousand for the quarter ended March 31, 2019 compared to $788 thousand for the same period ended in 2018. The increase in noninterest income was related primarily to an increase in mortgage operations and increased merchant activity.
Noninterest expense was up for the quarter ended March 31, 2019 at $5.6 million from $4.7 million in 2018. This increase is attributed primarily to the increased cost of operating the two branches acquired in Bluffton and Hilton Head Island markets from the acquisition of Atlantic Bancshares, Inc., during the second half of 2018.
Loan Loss Provision
Provision for loan losses for the quarters ended March 31, 2019 and 2018, respectively, was $165 thousand and $50 thousand. This increase is due primarily to the increase in loan growth from March 31, 2018 to March 31, 2019.
Nonperforming Assets
Nonperforming assets as a percentage of average assets was 0.09 percent and 0.07 percent for the quarters ended March 31, 2019 and 2018, respectively.