2009 Annual Report - 5.2MB PDF

Lumberton
Al Kahn
Elizabeth Matthews
Dr. J.C. Humphrey, Jr.
J.W. Hammonds
Fairmont
Gosnald “Butch” N. Floyd, Jr.
W.B. “Butch” Lennon
Rayford “Ray” Lupo
Zeb B. Oxendine
Selected Financial Data
The following table sets forth certain selected financial data concerning the Bank for the years
ended December 31, 2009, 2008, 2007, 2006 and 2005. This information should be read in
conjunction with and is qualified in its entirety by reference to the detailed audited consolidated
financial statements and notes thereto which are included in this Annual Report.
2009 2008 2007 2006 2005
Income Statement Data
(in thousands)
Interest income
Interest expense
Net interest income
Provision for loan loss
Net interest income after
provision for loan loss
$13,311
3,888
9,423
$13,801
4,856
8,945
$14,526
5,635
8,891
$ 12,768
4,636
8,134
$ 10,637
2.786
7,851
646
510
643
9
337
8,777
8,464
8,248
8,125
7,514
Hope Mills
Belton Jones
Dr. Kim Krivet
Other operating income
Other operating expenses
Income taxes
Securities gains (losses)
2,500
10,134
36
0
2,846
8,480
659
0
2,996
8,417
756
0
3,059
8,217
903
0
3,184
7,389
997
0
Maxton
R.L. Locklear
James Harold Collins
John Wilkerson
Charles David Locklear
Extraordinary items
Net Income
0
$1,107
0
$ 2,142
0
$2,071
0
$ 2,064
0
$ 2,312
$0.45
11.24
.21
$ 0.88
10.93
0.27
$ 0.85
10.11
0.26
$168,224
53,674
265,730
213,532
27,433
$ 145,296
55,362
236,693
180,532
26,677
$ 138,789
38,287
220,534
184,663
24,704
Red Springs
John C. Ray
Baker Locklear
Alton McNeill
Madie Rae Locklear
George Thomas Ammons
Rowland
Sylvia Pate
Mady Owens
Donald Bonner
St. Pauls
Glennis Hunt
Truett Canady
Per Share Data
Net income
Year end book value
Dividends declared
Loans, net
Investments
Total Assets
Deposits
Shareholders’ Equity
Net
Interest
Income
($ Millions)
16
$
0.85
9.49
0.23
$ 1.18
8.77
.22
$ 132,590
23,655
194,468
164,247
22,942
$122,074
25,852
187,116
159,188
21,061
Balance Sheet Data
(in thousands)
($ Millions)
Lumbee
Guaranty
Bank
Advisory
Boards
Pembroke
Roy Lacy Cummings
Archie Oxendine
LeMark Harris
Bobby Maynor
Linda Sheppard
Lycurous Lowry
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
7,850
2005
8134
2006
8,891
2007
8,945
2008
9,422
2009
1
To Our
Shareholders
It has been another challenging year for the banking industry as well as our country. I am
proud to report to you that our bank has remained as one of just a few that continues to be
profitable with strong capital and good liquidity. The Bank continues to uphold our
mission and objectives, which has given us good rewards.
2009 HIGHLIGHTS
• The Bank continues to grow.
• Deposits grew from $180.5 million to $213.5 million. (18.3%)
• Loans grew from of $145 million to $168 million. (15.9%)
2009 AREAS OF ACCOMPLISHMENT
• Continued to remain a 5-Star Superior rated bank by Bauer Financial, Inc.
• Our stock price remained stable while many other financial institutions have
declined.
• Began offering all-day banking in April 2009, allowing deposits made by the
close of business and credited to your account
that same day.
• Began offering a new product called Rewards
Checking, paying a 4.50% interest rate.
• Began offering Remote Capture for businesses,
allowing you to make deposits from your own
office rather than coming to the bank.
• Outsourced our item processing to give us
more efficient check clearing and processing.
However, earnings were down due to our tightened
net interest margin. Non-interest income was down
as well.
On behalf the Board of Directors and our Staff, I
would like to thank you for allowing us to be of
service to you, a customer and a stockholder.
Sincerely,
Larry R. Chavis
President/CEO
2
PEMBROKE BRANCH
Kent Chavis
Crese Ransom
Barbara Jacobs
Marcus Bryant
Eulalia (Lala) Graham
Nancy Blue
Lottie Locklear
Heather Locklear
Brandi Poorboy
April Bonilla
Adriana Locklear
Harrison Sweat
Linda Wilkins
Amanda Stickland
City Executive
Assistant Branch Manager
Loan Officer
Lender
Customer Service
Receptionist, Administrative Assistant
Crystal Collins
Betty Chavis
Geraldine Ivey
Teresa Hursey
MSML Trainee
LUMBERTON
PINE STREET
Jay Britt
Ann N. Britt
Janice Hay
Mary Herring
Lorena Case
Amy Romine
Vice President, City Executive
AVP, Branch Manager
Assistant / Receptionist
Head Teller
ST. PAULS BRANCH
Susanne Malloy
Yolanda Smith
Pam Miller
Virginia Faircloth
Sherrie McBee
Asst. VP, Branch Manager
CSR, Loan Processor
Head Teller
HOPE MILLS BRANCH
Debby Malone
Datta Parikh
Olympia Reed
Kelly Deese
FAIRMONT BRANCH
Branch Manager
MAXTON BRANCH
William Jeffery Walters Branch Manager
Connie Locklear
Loans
Sarah Sheppard
Head Teller
Victoria Oxendine
Laura Hunt
Victoria Talley
Rosa Hunt
RED SPRINGS BRANCH
Dwayne Jacobs
AVP, Branch Manager
Flora Locklear
Head Teller
April Locklear
Chona Oxendine
Teresa Richardson
ROWLAND BRANCH
Mike Smith
Branch Manager, Loan Officer
Francine McDonald
Amy Cribbs
Deidra Barton
Branch Manager
Head Teller
LUMBERTON
WEST 5th STREET
Judith Hunt
Cheryl Howington
Michele Smith
Angela Locklear
AVP, Branch Manager
Head Teller
LUMBERTON
FAYETTEVILLE ROAD
Alan Avant
Paula Strickland
Jeff Baldwin
Barbara Schiavo
Crystal Jacobs
Catherine Davis
VP, Branch Manager
Head Teller
Collector
FALCON VILLAGE
W. Mae Gantt
Judy Simpson
Melva Green
LAKE RIM
Allen Davidson
Carmen Serbio, III
Jennifer Lambert
Nita Carter
Kelly Hargrove
ROVERS
Kataria Oxendine
Clara Hewitt
Bradley Strickland
Branch Manager
Head Teller
VP Branch Manager
VP Business Development Officer
Head Teller
Jose Gonzalez
Greg Goins
MAINTENANCE TECHNICIAN
Garry Hunt
LUMBEE GUARANTY FINANCIAL
SERVICES, INC.
Brent Brooks
Sheila Humphrey
Gail Lassiter
Linda West
Investment Manager
(Pembroke Office)
Mortgage Manager
(Fayetteville Road Office)
Mortgage
(Fayetteville Road Office)
Mortgage
(Fayetteville Road Office)
15
Lumbee Guaranty Bank
Lumbee Guaranty Financial Services, Inc.
Board of Directors
Our
Team
SYBIL BULLARD
President, JR Jones Grain
CORPORATE ADMINISTRATION
Larry Chavis
Derrick Staten
Thresia Locklear
Kyle Chavis
Bryan Maynor
Linda Chavis
Janet Newton
Janice Graham
Tom Jernigan
Kim B. Jacobs
Debra Jefferson
President, CEO
Executive Vice President, Credit Branch Administrator
Senior Vice President, Operations
Senior Vice President, Credit Administrator
Senior Vice President, Branch Administrator
Vice President, Cashier Compliance
Vice President, Corporate Secretary, Personnel
Assistant Vice President, Training
Assitant Vice President, Accounting Officer
Executive Administrative Assistant
Accounts Payable Assistant
REDELL COLLINS
Secretary
Owner, Redell Collins Construction
DR. MARTIN BROOKS
Vice Chairman
Physician, Brooks Medical Clinic
BOOKKEEPING, DATA PROCESSING
LARRY T. BROOKS
Retired Principal
Yvonne Locklear Supervisor, Operations Officer
Austin Maynor
Computer Services
Denise McNeill
Maxine Lowry
Christina C. Lowry
Jessica Hubbard
CHARLES A. MAYNOR
Owner, Southern Interiors & Design
Owner, H & M Developers
LOAN CONSOLIDATION
Sheila Locklear
Operations Credit Officer
Tiki Aubin
Betty Vaughn
Paula Lowry Betty
JoAnn Chavis
INTERNAL AUDITOR
JAMES THOMAS
Retired, BellSouth
Tom Beatty
PROBLEM ASSETS
Sheryl Griffin
ARNOLD LOCKLEAR, Attorney,
Chairman
Locklear, Jacobs, Hunt and Brooks
14
3
Statements of Cash Flows
2009
Corporate
Team
Lumbee Guaranty Bank and Subsidiary
December 31
KYLE R. CHAVIS, SR. VP
Credit Administrator
BRYAN MAYNOR, Sr. VP
Branch Administrator
THRESIA LOCKLEAR, Sr. VP,
Operations
December 31
December 31
$ 2,142,462
$ 2,071,071
510,450
21,328]
587,684
24,843
4,016
643,361
0
557,634
26,602
[ 124,671]
49,393
113,731
[ 1,834,69]
[ 113,672 ]
[ 165,944]
48,575
[ 2,845,141 ]
[ 2,341,598]
[ 826,942]
[ 4,467,765 ]
18,482,971
3,938,683
[ 5,201,098 ]
19,337,287
6,150,844
[ 22,927,876 ]
[ 169,332 ]
[ 11,176,086 ]
14,725,570
[ 6,507,148]
[ 288,205]
[ 29,145,925]
11,322,902
[ 6,199,101]
[ 2,226,726]
[ 29,168,945]
14,605,385
[ 94,096 ]
229,151
34,232
[ 19,641,820 ]
[ 24,847,527]
[ 22,989,387]
33,000,040
[ 512,730 ]
[ 100,000 ]
210,084
51,208
[ 4,131,039]
[ 659,224]
113,507
324,456
51,200
32,648,602
[ 4,301,100]
20,008,267
7,805,684
[ 9,811,340]
3,169,724
Cash and Cash Equivalents at Beginning of Period
15,724,550
25,535,890
22,366,166
Cash and Cash Equivalents at End of Period
23,530,234
15,724,550
25,535,890
Supplemental Disclosures of
Cash Flow Information
Cash paid during the year for:
Interest
$4,002,265
$ 5,021,787
$ 5,585,990
$
$
Operating Activities
Net Income
Adjustments to Reconcile Net Income
to Net Cash Provided
Provision for Possible Loan Losses
[Gain] Loss on Sale of Securities
Depreciation and Amortization
Amortization of Premiums (discount)
Deferred Income Taxes
Decrease [increase] in Accrued
Interest Receivable
Increase [decrease] in Accrued
Interest Payable
Decrease [increase] in Prepaid
Expenses and Other Assets
Increase [decrease] in Accrued Expenses
and Other Liabilities
Net Cash Provided by (used by)
Operating Activities
Investing Activities
Net (increase) decrease in loans
Purchases of Premises and Equipment
Purchase of Investment Securities
Proceeds from Sale of Securities
Decrease [increase] in Real Estate acquired
in Settlement of Loans
DERRICK STATEN, Exec. VP
JANET NEWTON, VP
Corporate Secretary
LINDA CHAVIS, VP
Cashier
JANICE GRAHAM, AVP
Training
Net cash provided by (used by)
Investing Activities
Financing Activities
Net Increase (decrease) in Deposit Accounts
Cash Dividends
Proceeds from Issuance of Stock
Increase (Decrease) Unrealized Gain / Loss
Stock-Based Compensation
Net cash provided by (used by)
Financing Activities
Increase(decrease) in cash and cash equivalents
TOM JERNIGAN, AVP
Accounting Officer
LARRY R. CHAVIS,
President, CEO
INCOME TAXES
4
2009
$1,107,185
2008
645,721
[ 40,175 ]
526,300
73,816
[ 136,760 ]
$266,673
[
739,675
2007
20,416,474
631,204]
100,251
122,746
[
714,316
13
Consolidated Statements of Shareholders’ Equity
Lumbee Guaranty Bank and Subsidiary
Common
Stock
Surplus
Undivided
Profits
Net Unrealized Total Shareholder’s
Loss of Securities
Equity
$4,883,140
$4,196,039
Net Income
$17,072,691
$425,007
26,576,877
General
1,107,185
Issuance of common stock
Cash dividends paid on Common Stock
June. 2009 - $ .14 a share
[ 341,820 ]
Dec. 2009 - $ .07 a share
[ 170,910 ]
Lumbee Guaranty Bank is an independent,
community bank which conducts its business from
twelve full service offices located strategically in
Net change in Unrealized Gain (Loss) of
Available for Sale Securities
Robeson and Cumberland Counties. The Bank extends
210,084
Stock-based compensation
both commercial and consumer loans throughout its
51,208
Balance at End of Year
And Analysis of Financial Condition
And Results of Operations
The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes
included in this report.
Year Ended December 31, 2009
Balance at beginning of year
Management’s Discussion
$ 4,883,140
$ 4,247,247
$ 17,667,146
$ 635,091
27,432,624
market area and offers a full range of deposit accounts
for its customer base.
The bank has experienced significant sustained
Year Ended December 31, 2008
Balance at beginning of year
$4,968,418
$4,046,054
Net Income
Issuance of common stock
$15,589,453
$100,551
24,704,476
2,142,462
14,722
growth over the past five years in assets and deposits.
Assets increased from $187,115,500 at December 31,
2005 to $265,866,972 at December 31, 2009, and total
98,785
Cash dividends paid on Common Stock
Results of
Operations
The Bank’s ear nings are
dependent to a large degree on
its net interest income defined
as the difference between gross
interest and fees earned on
loans, investment securities,
federal funds sold, and securities
purchased under agreements
deposits increased from $159,183,429 at December
to resell and interest paid on
June. 2008 - $ .13 a share
[ 317,404 ]
31, 2005 to $213,532,375 at December 31, 2009.
deposits. Net interest income
Dec. 2008 - $ .14 a share
[ 341,820 ]
Dividends paid over the last five years have averaged
is affected by the interest rate
29.5% of the average net income of $1,939,235.
earned or paid and by volume
Net change in Unrealized Gain (Loss) of
Available for Sale Securities
Stock-based compensation
Balance at End of Year
Gross loans have increased from $123,974,315 at
324,456
December 31, 2005 to $170,865,736 at December 31,
51,200
$ 4,983,140
$ 4,196,039
$ 17,072,691
$ 425,007
26,676,877
Year Ended December 31, 2007
Balance at beginning of year
$4,955,418
$3,958,803
Net Income
Issuance of common stock
$14,149,586
$ [ 22,195 ]
23,041,612
2,071,071
13,000
2009, while average net annual charge-offs over the last
Cash dividends paid on Common Stock
loans are set at competitive rates while maintaining
Non-interest expenses have
interest spreads of 4.24% and 4.22% in 2009 and
increased from $8,990,058 in
2008 between interest earned on average loans and
2008 to $10,779,960 in 2009.
bearing deposits. The sustained growth provided by
[ 315,602 ]
operations resulted in a 12.3% growth rate in total
Dec. 2007 - $ .13 a share
[ 315,602 ]
assets for 2009.
Available for Sale Securities
Balance at End of Year
12
Gross loans grew 15.9% in 2009 and 4.1%
122,746
$ 4,968,418
$ 4,046,054
$ 15,589,453
$ 100,551
in 2008. Lumbee Guaranty Bank closely monitors
24,704,476
Net interest income increased
5.3% in 2009 and .6% in 2008.
June. 2007 - $ .13 a share
Net change in Unrealized Gain (Loss) of
and interest-bearing liabilities.
five years was $314,200. Interest rates on deposits and
investments and interest paid on average interest
87,251
changes in interest-earning assets
changes in the financial markets in order to maximize
This is a result of increased
operating expenses such as
salaries and employee benefits,
FDIC insurance, provision for
loan losses, data processing and
collection and repo expenses.
the yield on its assets.
5
Management’s Discussion
Consolidated Statements of Earnings
Lumbee Guaranty Bank and Subsidiary
December 31 December 31 December 31
Provision for Loan Losses
The provision for loan losses was $645,721, $510,450, and $643,361, respectively for
the years ended December 31, 2009, 2008, and 2007. The reserve for possible loan losses
was $2,182,948 at December 31, 2009, approximately 1.21% of gross outstanding loans at that
date. Management deems the 2009 reserve balance to be adequate for possible charge-offs in
subsequent years on the uncollected loan balances at December 31, 2009.
Liquidity and Capital Resources
The Bank’s liquidity position is primarily dependent upon its need to respond to loan
demand and short-term demand for funds caused by withdrawals from deposit accounts and
upon the liquidity of its assets. The Bank’s primary liquidity sources include cash and amounts
due from other banks, federal funds sold and U.S. Agency securities as well as other short-term
investment securities. In addition, the Bank has the ability to borrow funds from the Federal
Reserve System and to purchase federal funds from other financial institutions. The Bank’s
management believes its liquidity sources are adequate to meet its operating needs.
Total shareholder’s equity was $27,432,625 or 10.3% of total assets and $26,676,877 or
11.2% of total assets at December 31, 2009 and 2008.
TOTAL ASSETS
MILLIONS
200,000
6
187,116
265,730
194,468
220,534
236,693
180,000
160,000
Service Charges on Deposit Accounts
Other Operating Income
Total Operating Income
Operating Expenses
Interest Paid on NOW and
Money Market Accounts
Interest Paid on Savings
Interest Paid on Time Certificates of
Deposit of $100,000 or more
Interest Paid on Other Time Deposits
Total Interest Expense
Salaries and Wages
Other Personnel Costs
Total Personnel Expense
Net Occupancy Expense
Equipment Expense
Provision for Loan Losses
Other Operating Expense
Total Other Noninterest Expense
Total Operating Expenses
Income Before Income Taxes
and Securities Gain (Losses),
and Extraordinary Items
Applicable Income Taxes
Income Before Securities Gains (Losses)
and Extraordinary Items
Securities Gains (Losses) less related
Taxes (Benefits)
Extraordinary items
Net Income
140,000
120,000
100,000
80,000
60,000
40,000
2008
2007
$ 10,988,320
$ 11,223,250
1,155
58,896
162,939
77,467
901,038
97,170
910,743
558,257
758,841
1,343,381
13,311,361
1,511,413
13,801,472
790,361
14,256,656
1,825,273
675,485
$ 15,812,119
2,240,120
605,704
$ 16,647,296
2,188,662
807,514
$17,521,832
262,354
18,500
456,234
43,211
1,015,409
185,465
1,044,025
2,563,714
3,888,593
4,013,213
1,898,691
5,911,904
533,934
432,164
645,721
3,256,237
10,779,960
$ 14,668,553
1,187,598
3,168,801
4,855,844
3,571,543
1,214,928
4,786,471
465,075
501,836
510,450
2,726,226
8,990,058
$ 13,845,902
1,280,184
3,153,506
5,634,564
3,556,889
1,322,215
4,879,104
455,303
541,514
643,361
2,541,381
9,060,663
$ 14,695,227
1,143,566
36,381
2,801,394
658,932
2,826,605
755,534
$ 1,107,185
$ 2,142,462
$ 2,071,071
0
0
$ 1,107,185
0
0
$ 2,142,462
0
0
$ 2,071,0714
$ .45
$ .45
$ .21
$ .88
$ .88
$ .27
$ .85
$ .85
$ .26
$
12,255,258
PER SHARE DATA (Based on the weighted
average number of shares outstanding.)
20,000
0
Operating Income
Interest and Other Fees on Loans
Interest on Federal Funds Sold
and Securities Purchased
under Resale Agreement
Interest on Securities:
Federal Agency
State, County, and Municipals
Interest on Time Deposits
and Other Investments
Total Interest
2009
2005
2006
2007
YEAR
2008
2009
Income Before Securities Gains (Losses)
and Extraordinary Items
Net Income
Cash Dividends
11
Consolidated Statements of Condition
Lumbee Guaranty Bank and Subsidiary
December 31 December 31 December 31
Assets
Cash and Due From Banks
Investment Securities
available for sale
Investment Securities
held to maturity
Federal Funds sold and repos
Loans, net
Bank Premises and
Equipment, net
Foreclosed Real Estate
Accrued Interest Receivable
Prepaid Expenses
Other Assets
Total Assets
Liabilities and Shareholders’ Equity
Deposits
Demand
N.O.W. and Money Market accounts
Savings
Time Certificates of Deposit
of $100,000 or more
Other Time Deposits
Total Deposits
Reserve for Interest due depositors
Other Liabilities
Total Liabilities
2009
$ 22,530,234
Shareholders
Equity
Growth
10
14,624,550
$
14,099,779
26,046,165
1,000,000
23,418,436
1,100,000
23,463,883
9,312,574
168,224,059
145,296,183
138,789,035
9,341,938
870,916
1,220,412
1,506,059
9,184,811
9,698,906
776,820
1,269,805
364,753
8,199,762
9,998,385
547,669
1,383,536
274,785
6,441,270
$ 265,866,972
$ 236,692,621
$ 220,534,232
$ 47,753,855
46,741,130
10,618,478
$ 41,733,939
43,553,323
10,357,200
$ 42,170,918
44,070,108
11,242,300
45,750,561
62,668,351
26,843,390
58,044,483
27,445,648
59,734,400
213,532,375
180,532,335
184,663,374
297,319
24,604,653
410,991
29,072,418
576,935
10,589,447
$ 238,434,347
$ 210,015,744
$ 195,829,756
4,883,140
4,247,247
17,667,147
4,983,140
4,196,039
17,072,691
4,968,418
4,046,054
15,589,453
635,091
425,007
100,551
27,432,625
26,676,877
24,704,476
$ 265,866,972
$ 236,692,621
$ 220,534,232
25,000
21,061
26,677 27,433
24,704
23,042
20,000
15,000
As of the end of December 31, 2009 and 2008, past due and non-accrual loans, in thousands,
as extracted from the Call Reports, Schedule RC-N of December 31, 2009 and 2008 were as follows:
Past due 30
through 89 days
and still accruing
5,000
2005
2006
2007
YEAR
2008
2009
Past due 90
days or more
and still accruing
non-accrual
2009
2008
2009
2008
2009
2008
Real Estate Loans
Installment Loans
Credit Cards and Related Plans
Commercial and all Other Loans
$ 2,129
401
0
298
$ 1,563
405
0
109
$ 220
32
0
0
$ 196
62
0
0
$1397
249
0
40
$ 1030
240
0
3
Total
$ 2,828 $ 2,077
$ 252
$ 258
$ 1,686 $ 1,273
Allowance for Loan Losses and Summary of Loan Loss Experience
As a matter of policy, the Bank maintains an allowance for loan losses. The allowance for loan losses is created by direct
charges to income, and losses on loans are charges against the allowance when realized. The amount of the allowance is
based upon an evaluation of the portfolio, current economic conditions, historical loan loss experience, and other factors
management deems appropriate. The Bank’s management believes its allowance for loan losses is adequate under existing
economic conditions.
The following table summarizes the Bank’s loan loss experience as of the end of December 31, 2009 and 2008.
2009
2008
$ 1,782
$ 1,660
31
133
181
0
$ 345
50
163
220
0
$ 433
5
6
78
0
89
13
4
28
0
45
Net Charge-offs
$ 256
$ 388
Additions Charged to Operations
$ 657
$ 510
$ 2,183
$ 1,782
.2%
.3%
Balance at beginning of period
Charge-offs
Commercial, Financial and Agricultural
Real Estate
Installment Loans to Individuals
Credit Cards and Related Plans
Total Charge-offs
Recoveries
Commercial, Financial and Agricultural
Real Estate
Installment Loans to Individuals
Credit Cards and Related Plans
Total Recoveries
Balance at end of period
10,000
0
Risk Elements
16,223,316
31,943,406
MILLIONS
Total Liabilities and Shareholders’ Equity
$
2007
25,942,378
Shareholders’ Equity
Common Stock, par value $2.00
Authorized 5,000,000 shares
issued & outstanding 2,441,570, 2,441,590
and 2,439,209 shares, respectfully
Surplus
Undivided Profits
Net unrealized holding gains (losses) on
AFS Securities
Total Shareholders’ Equity
2008
Management’s Discussion
Ratio of Charge-offs during the period to
Average Gross Loans Outstanding
during the period
7
Key Ratios
The following schedule of key ratios is presented for the years December 31, 2008, 2007 and 2006.
2009
Return on Equity and Assets
Return on Assets
Return on Equity
Dividend Payout Ratio
Equity to Assets (averages)
Ending Equity to Ending Assets
Average Interest Earning Assets
to Average Total Assets
Average Net Loans
to Average Total Loans
Average Interest Earning Assets
to Average Interest Bearing Liabilities
2008
2007
.42%
4.04%
46.32%
11.22%
10.32%
.94%
8.39%
30.77%
11.22%
11.27%
.98%
8.72%
30.47%
11.15%
11.20%
86.71%
88.19%
87.53%
98.49%
98.53%
98.61%
107.27%
106.09%
100.70%
Market for Our Common Stock
Our common goal is traded primarily in privately negotiated transactions and there are currently no public trading markets or published prices for the stock. On December 31, 2009, there were 1872 shareholders of record.
During 2007, 2008, and 2009 we paid dividends as shown on “consolidated statement of shareholder equity.” Our
stock as of December 31, 2009 is trading at $23.50 per share.
Return On Assets (%)
1.5
1.32
1.0
Return On Equity (%)
10.98
1.07
.98
.94
0.5
12
10
8
6
4
2
0
.42
0
2005
2006
2007 2008
YEAR
NET INCOME
2009
2,312
MILLIONS
2,500
8.72
8.39
4.04
2005
2006
2,064 2,071 2,142
2007 2008
YEAR
2009
The Board of Directors and Shareholders
Lumbee Guaranty Bank
Pembroke, North Carolina
We have audited the accompanying consolidated statements of condition of Lumbee
Guaranty Bank and Subsidiary as of December 31, 2009, 2008 and 2007, and the related
consolidated statements of income, stockholders’ equity, and cash flows for each of the
years in the three-year period ended December 31, 2009. These financial statements are
the responsibility of the Bank’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of
material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Lumbee Guaranty Bank
and Subsidiary at December 31, 2009, 2008, and 2007, and the consolidated results of
its operations and its cash flows for each of the years in the three-year period ended
December 31, 2008, in conformity with accounting principles generally accepted in
the United States of America.
February 2, 2010
2,000
_____________________________________________
NELSON PRICE & ASSOCIATES, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
1,107
1,500
1,000
500
0
8
9.39
INDEPENDENT AUDITOR’S REPORT
2005
2006
2007
YEAR
2008
2009
9
In This 2009
Report
TABLE OF CONTENTS
Letter to the Shareholders ......................................... 2
Stockholder Information
Board of Directors ....................................................... 3
Notice of Annual Meeting
Selected Financial Data ............................................... 1
Corporate Team 2009 ................................................. 4
The Annual Stockholders’ Meeting of
Lumbee Guaranty Bank
will be held May 19, 2010
Main Office, Pembroke
Management’s Discussion ......................................... 5
Independent Auditor’s Report ................................. 9
Financial Statements .................................................. 10
Our Team 2009 ............................................................ 14
Branch Advisory Boards ........................................... 16
Stockholder Information ......................................... 17
Form 10-K
More detailed information relating to Lumbee Guaranty Bank is
contained on Form 10-K Annual Report to the Federal Deposit
Insurance Corporation. A copy of the 10-K for 2008 can be mailed,
without charge, upon request to:
Lumbee Guaranty Bank
P.O. Box 908
Pembroke, NC 28372
Stock Transfer Agent
About The Report
The 2009 Annual Report is presented in a summary format to provide information regarding the
performance of Lumbee Guaranty Bank in a manner that is meaningful and useful to the widest
range of readers. The audited consolidated financial statements of Lumbee Guaranty Bank and
subsidiary, Lumbee Guaranty Financial Services, Inc. and other more detailed analytical information
regarding the Corporation are contained in the Lumbee Guaranty Bank 2009 on Form 10-K with
the Federal Deposit Insurance Corporation.
First Citizens Bank
for information contact:
Lumbee Guaranty Bank
P.O. Box 908
Pembroke, NC 28372
Independent Accountants
Nelson Price & Associates
4904-B Salem Square Professional Park
Fayetteville Road
Lumberton, NC 28358
Member Federal Deposit Insurance
Corporation
This statement has not been reviewed for accuracy or relevancy
by the Federal Deposit Insurance Corporation.
17
FAIRMONT
301 North Walnut Street
Fairmont, NC 28340
(910) 628-7840 Phone
(910) 628-9924 Fax
HOPE MILLS
PO Box 589
3500 N. Main Street
Hope Mills, NC 28348
(910) 424-0010 Phone
(910) 423-2386 Fax
FAYETTEVILLE
Falcon Village Branch
6313 Raeford Road
Fayetteville, NC 28304
(910) 867-0286 Phone
(910) 867-0810 Fax
Lake Rim Branch
2315 Bloom Avenue
Fayetteville, NC 28304
(910) 487-2415 Phone
(910) 860-0561 Fax
LUMBERTON
Pine Street Branch
PO Box 1486
600 North Pine Street
Lumberton, NC 28359
(910) 738-3200 Phone
(910) 618-9647 Fax
West 5th Street Branch
2899 W. 5th Street
Lumberton, NC 28358
(910) 739-8787 Phone
(910) 739-8781 Fax
Fayetteville Road Branch
4845 Fayetteville Road
Lumberton, NC 28358
(910) 671-9011 Phone
(910) 671-8753 Fax
MAXTON
104 Martin L. King, Jr. Drive
Maxton, NC 28364
(910) 844-3001 Phone
(910) 844-4067 Fax
RED SPRINGS
PO Box 151, 215 E. 4th Street
Red Springs, NC 28377
(910) 843-5171 Phone
(910) 843-1199 Fax
FOR YOU, FOR YOUR FUTURE . . .
ROWLAND
PO Box 398
201 N. Bond Street
Rowland, NC 28383
(910) 422-3572 Phone
(910) 422-8650 Fax
ST. PAULS
PO Box 176
306 South 5th Street
St. Pauls, NC 28384
(910) 865-4196 Phone
(910) 865-8415 Fax
PEMBROKE
PO Box 908
403 East Third Street
Pembroke, NC 28372
(910) 521-9707 Phone
(910) 521-0772 Fax
ANNUAL REPORT 2009