NEWS RELEASE

NEWS RELEASE
FOR FURTHER INFORMATION:
WEBSITE: www.bnccorp.com
TIMOTHY J. FRANZ, CEO
TELEPHONE: (612) 305-2213
DANIEL COLLINS, CFO
TELEPHONE: (612) 305-2210
BNCCORP, INC. REPORTS THIRD QUARTER NET INCOME OF $2.0 MILLION, OR
$0.43 PER DILUTED SHARE
2014 Third Quarter Highlights
•
Net income increases $1.5 million, or 306.8%, compared to 2013 third quarter
•
Net interest income increases by $2.1 million, or 46.2%, compared to 2013 third quarter
•
Non-interest income increases by $868 thousand, or 22%, compared to 2013 third quarter, excluding
non-recurring non-interest income item
•
Non-interest expense increases by $640 thousand, or 7.9%, compared to 2013 third quarter,
excluding non-recurring non-interest expense items
•
Book value per common share increases to $17.18 at September 30, 2014 compared to $14.45 at
December 31, 2013
•
High-cost subordinated debentures of $7.5 million redeemed in third quarter of 2014
•
BNCCORP, INC. adds Mr. Nathan Brenna to Board of Directors
BISMARCK, ND, October 27, 2014 – BNCCORP, INC. (BNC or the Company) (OTCQB
Markets: BNCC), which operates community banking and wealth management businesses in
North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas,
Minnesota, Arizona and North Dakota, today reported financial results for the third quarter
ended September 30, 2014.
1
Net income for the 2014 third quarter was $1.981 million, or $0.43 per diluted share. This
compares to net income of $487 thousand, or $0.05 per diluted share, in the third quarter of
2013. Results for the third quarter of 2014 primarily reflect substantially increased net interest
income largely due to higher balances of earning assets and a rise in net interest margin. Noninterest income and non-interest expense increased compared to the third quarter of 2013,
excluding non-recurring items. The third quarter of 2014 also included a reversal of previous
provisions for loan losses which increased pre-tax earnings by $200 thousand as credit quality
continues to improve.
Timothy J. Franz, BNCCORP President and Chief Executive Officer, said, “We had a solid
quarter and have made significant strides forward, particularly when compared to the unsettled
business environment in the third quarter one year ago. Our core bank is growing and mortgage
banking has largely shifted away from refinancing activity toward purchase originations. These
improvements are resulting in higher net interest income and improved non-interest income. As a
result of hard work, our credit risk profile is currently very good.”
Mr. Franz added, “While our improvement has been noteworthy, challenges remain. Balancing
loan growth and credit risk requires constant diligence and mortgage banking operations
dependent on purchase activity introduces seasonality to a complicated business segment. We are
focused on these challenges and believe our ability to grow deposits and the pipeline of loans
held for investment should continue to drive performance. Most importantly, our people have the
talent and motivation to continue creating value.”
Third Quarter Results
Net interest income for the third quarter of 2014 was $6.749 million, an increase of $2.133
million, or 46.2%, from $4.616 million in the same period of 2013. Third quarter interest income
rose year over year as the average balance of interest earning assets increased by $95.5 million to
$845.8 million from $750.3 million, when compared to the third quarter of 2013. The average
loans held for investment increased $54.3 million, or 19.6%, compared to the prior year third
quarter. On average, loans held for sale decreased by $14.4 million when compared to the third
quarter of 2013 due to lower mortgage banking activity. The decrease in net interest income
resulting from this lower balance was more than offset by the net interest income resulting from
2
an increase of $92.5 million in average investment securities during the same period. The net
interest margin in the third quarter of 2014 increased to 3.17% compared to 2.44% in the same
period of 2013. The yield on earning assets increased to 3.54% in the third quarter of 2014,
compared to 2.94% in the third quarter of 2013.
Interest expense decreased $153 thousand or 16.2% despite growth in deposits as we have been
able to lower the rates paid on deposits. The redemption of $7.5 million of 12.05% subordinated
debentures reduced interest expense by approximately $106 thousand in the third quarter of
2014. The cost of interest bearing liabilities declined to 0.47% in the current quarter, compared
to 0.61% in the same period of 2013. The cost of core deposits was 0.17% in the current quarter
compared to 0.22% in the same period of 2013.
A reversal of previous provisions for credit losses increased pre-tax earnings by $200 thousand
in the third quarter 2014 as credit quality continues to improve.
Non-interest income for the third quarter of 2014 was $4.814 million, a decrease of $187
thousand, or 3.7%, from $5.001 million in the third quarter of 2013. Excluding the impact of
non-recurring insurance proceeds aggregating $1.055 million in 2013, non-interest income in the
third quarter of 2014 increased by $868 thousand or 22.0%. Mortgage revenue of $2.782 million
was up $360 thousand compared to $2.422 million in the third quarter of 2013. Although the
mortgage banking market is significantly influenced by interest rates and federal policies, we
have successfully transformed this business as purchase originations now exceed refinance
originations. The focus on purchase originations may result in a more seasonal business,
particularly in our more northern locations. The 2014 third quarter included gains on sales of
SBA loans of $688 thousand, compared to $301 thousand in the same period of 2013. Other
recurring sources of fee income increased by smaller but steady amounts.
Non-interest expense for the third quarter of 2014 was $8.765 million, a decrease of $686
thousand, or 7.3%, from $9.451 million in the third quarter of 2013. Excluding the impact of
non-recurring impairment charge and reductions of post-retirement benefits, which netted to
$1.326 million in 2013, non-interest expense in the third quarter or 2014 increased by $640
thousand, or 7.9%. The increase is primarily related to incentive compensation expense related
to loan and deposit growth.
3
In the third quarter of 2014, we recorded income tax expense of $1.017 million equating to an
effective tax rate of 33.92%. During the three month period ending September 30, 2014, the
Company recorded increased tax expense equating to an annualized effective tax rate of 32.00%.
This adjustment results from a different mix of taxable and non-taxable income than anticipated.
In the third quarter of 2013, we recorded a tax benefit of $321 thousand as life insurance
proceeds of $1.055 million were not taxable.
Net income available to common shareholders was $1.507 million, or $0.43 per diluted share, for
the third quarter of 2014 after accounting for dividends on preferred stock. Dividends on the
preferred stock aggregated $474 thousand in the third quarter of 2014 and $330 thousand in the
same period of 2013. The dividend associated with $20.1 million of preferred stock increased as
the annual dividend rate increased to 9% from 5% in February 2014. Net income available to
common shareholders in the third quarter of 2013 was $157 thousand, or $0.05 per diluted share.
Nine Months Ended September 30, 2014
Net interest income for the nine month period ended September 30, 2014 was $19.277 million,
an increase of $5.445 million, or 39.4%, from $13.832 million in the same period of 2013. The
average balance of earning assets during that period was approximately $829.8 million,
compared to approximately $738.3 million in the prior year. The net interest margin during the
nine month period of 2014 increased to 3.11%, compared to 2.50% during the same period of
2013. The yield on earning assets was 3.53% in the nine month period ended September 30,
2014, compared to 3.04% in the same period of 2013. The cost of interest bearing liabilities was
0.53%, in the first nine months of 2014, compared to 0.65% in the same period of 2013. As
noted above, we repaid $7.5 million of high cost subordinated debentures in the third quarter of
2014 and the cost of core deposits was 0.18% in the first nine months of 2014 compared to
0.25% in the same period of 2013.
A reversal of previous provisions for credit losses increased pre-tax earnings by $800 thousand
in the first nine months of 2014. A provision for credit losses of $700 thousand was recorded in
the same period in 2013.
4
Non-interest income for the first nine months of 2014 was $14.459 million, a decrease of
$10.218 million, or 41.4%, from $24.677 million in the same period of 2013. Excluding the
impact of non-recurring insurance proceeds aggregating $1.055 million in 2013, non-interest
income in the first nine months of 2014 decreased by $9.163 million or 38.8% compared to the
first nine months of 2013. Non-interest income was particularly influenced by lower interest
rates in 2013 as mortgage banking revenues were $8.455 million in the first three quarters of
2014, a decrease of $8.958 million, or 51.4%, compared to the same period in 2013. Gains on
sales of investments in the first nine months of 2014 were $528 thousand compared to $1.247
million in the same period of 2013. Gains on sales of SBA loans were $1.688 million in the first
nine months of 2014, compared to $1.408 million in the same period of 2013. Gains and losses
on sales of loans and investments can vary significantly from period to period. Bank fees and
service charges and wealth management revenues grew 6.3% and 14.0%, respectively, reflecting
growth of our core banking and wealth management services.
Non-interest expense for the first nine months of 2014 was $25.742 million, a decrease of $2.165
million, or 7.8%, from $27.907 million in the same period of 2013. Excluding the impact of the
non-recurring impairment charge and reduction of post-retirement benefits, which netted to
$1.326 million in 2013, non-interest expense in the first nine months of 2014 decreased by $839
thousand, or 3.2%. The reduction is primarily driven by lower mortgage related variable costs as
well as lower regulatory assessments. Included in other expenses in the first nine months of 2014
is $356 thousand of costs recorded related to the subordinated debt redemption.
During the nine month period ended September 30, 2014, we recorded tax expense of $2.814
million, which resulted in an effective tax rate of 32.00%. Tax expense of $3.154 million was
recorded during the nine month period ended September 30, 2013, which resulted in an effective
tax rate of 31.85%. During the third quarter of 2014, the Company increased the effective tax
rate from 31.00% to 32.00% due to a different mix of taxable and non-taxable income than
anticipated.
Net income available to common shareholders was $4.659 million, or $1.34 per diluted share, for
the nine months ended September 30, 2014 after accounting for dividends on preferred stock.
The dividends aggregated $1.321 million in the first nine months of 2014 and $981 thousand in
the same period of 2013. The costs associated with $20.1 million of preferred stock increased in
5
February of 2014 when the dividend rate increased to 9% from 5%. Net income available to
common shareholders for the first nine months ended September 30, 2013 was $5.767 million, or
$1.66 per diluted share.
Assets, Liabilities and Equity
Total assets were $899.7 million at September 30, 2014, an increase of $56.6 million, or 6.7%,
compared to $843.1 million at December 31, 2013. The increases in recent periods have been
funded primarily by growing deposits in North Dakota as this region is experiencing robust
economic conditions.
Loans held for investment, which aggregated $335.4 million at September 30, 2014, $317.9
million at December 31, 2013 and $294.9 million at September 30, 2013, increased by $40.5
million, or 13.7%, since September 30, 2013. The economic prosperity in North Dakota provides
tail-winds for long-term loan growth; however, these conditions also result in exceptional
liquidity for many businesses and our clients in North Dakota are generally predisposed to repay
loans on an accelerated basis. While such repayments challenge loan growth in the short term,
the economic vitality and appetite for loans continues to be greater in North Dakota than other
regions.
Total deposits were $774.3 million at September 30, 2014, increasing by $67.8 million, or 9.6%,
from September 30, 2013. Core deposit balances were $720.0 million at September 30, 2014,
$658.7 million at December 31, 2013 and $641.7 million at September 30, 2013.
The table below shows growth in deposits since 2010.
September 30,
2014
In thousands
ND Bakken Branches
ND Non-Bakken Branches
Total ND Branches
Other
Total Deposits
$
$
172,276
413,332
585,608
188,658
774,266
December 31,
2012
December 31,
2013
$
$
166,904
382,225
549,129
174,100
723,229
$
$
144,662
335,452
480,114
169,490
649,604
December 31,
2011
$
$
125,884
285,488
411,372
164,883
576,255
December 31,
2010
$
$
97,347
281,684
379,031
282,080
661,111
In August 2014, we redeemed $7.5 million of subordinated debentures. These debentures
6
accrued interest at 12.05%. Redemption costs of $356 thousand were accrued in the second
quarter of 2014. The significant reduction in interest expense has a positive impact on earnings
and capital.
Trust assets under management or administration decreased to $255.9 million at September 30,
2014, compared to $256.2 million at September 30, 2013. This decrease is a direct reflection of
market depreciation, as our wealth management business is capturing wealth being created by the
exceptionally strong economic conditions in North Dakota, both in managed agency and
retirement services.
Capital
Banks and their bank holding companies operate under separate regulatory capital requirements.
At September 30, 2014, BNCCORP’s tier 1 leverage ratio was 10.13%, the tier 1 risk-based
capital ratio was 20.22%, and the total risk-based capital ratio was 21.48%.
At September 30, 2014, BNCCORP’s tangible common equity as a percent of assets was 6.51%
compared to 5.79% at December 31, 2013. Common shareholders’ equity at September 30, 2014
was $58.7 million and we had preferred stock and subordinated debentures outstanding which
aggregated $36.1 million at September 30, 2014.
Book value per common share of the Company was $17.18 as of September 30, 2014, compared
to $14.45 at December 31, 2013. Book value per common share, excluding accumulated other
comprehensive income, was $16.12 as of September 30, 2014, compared to $14.89 at December
31, 2013.
At September 30, 2014, BNC National Bank had a tier 1 leverage ratio of 10.12%, a tier 1 riskbased capital ratio of 20.34%, and a total risk-based capital ratio of 21.60%. At September 30,
2014, tangible common equity of BNC National Bank was 10.56% of total Bank assets.
In July of 2013, the Federal Reserve issued new regulatory capital standards for community
banks which incorporate some of the capital requirements addressed in the Basel III framework
and begin to be effective January 1, 2015. We have reviewed estimates of our regulatory capital
7
ratios under the new Basel III framework and expect to be in compliance with these standards.
Asset Quality
Nonperforming assets were $1.2 million at September 30, 2014, down from $6.7 million at
December 31, 2013. The ratio of nonperforming assets to total assets was 0.13% at September
30, 2014 and 0.79% at December 31, 2013. Nonperforming loans were $130 thousand at
September 30, 2014, down from $5.6 million at December 31, 2013.
The allowance for credit losses was $8.7 million at September 30, 2014, compared to $9.8
million at December 31, 2013. The reduction of the allowance for credit losses reflects stabilized
risk in our loan portfolio and the allowance coverage relative to nonperforming and classified
loans. While the recent decreases in oil and agricultural commodity prices have yet to have a
significant negative effect, prolonged declines could have a detrimental economic impact on the
North Dakota economy. The allowance for credit losses as a percentage of total loans at
September 30, 2014 was 2.30%, compared to 2.81% at December 31, 2013. The allowance for
credit losses as a percentage of loans and leases held for investment at September 30, 2014 was
2.59%, compared to 3.10% at December 31, 2013.
At September 30, 2014, BNC had $9.5 million of classified loans, $130 thousand of loans on
non-accrual and $1.1 million of other real estate owned. At December 31, 2013, BNC had $13.5
million of classified loans, $4.7 million of loans on non-accrual and $1.1 million of other real
estate owned. At September 30, 2013, BNC had $13.0 million of classified loans, $10.1 million
of loans on non-accrual and $2.2 million of other real estate owned.
BNCCORP, INC Adds Director
Mr. Nathan P. Brenna was added to the Company’s Board of Directors in September 2014. Mr.
Brenna has a distinguished legal background having represented clients across the country for
more than a decade. During his legal career, Mr. Brenna represented BNC on several matters
and, as a result, has familiarity with BNC’s history. In 2007, Mr. Brenna returned to his roots to
operate a large farming and ranching operation in northwestern North Dakota. These operations
are located near BNC's branches in the oil producing regions of North Dakota where he is also
8
active in community service. Mr. Brenna’s background should contribute a valuable perspective
on matters of corporate governance, and an insight into local community and business issues.
BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company
dedicated to providing banking and wealth management services to businesses and consumers in
its local markets. The Company operates community banking and wealth management
businesses in North Dakota, Arizona and Minnesota from 14 locations. BNC also conducts
mortgage banking from 12 offices in Illinois, Kansas, Minnesota, Arizona and North Dakota.
This news release may contain "forward-looking statements" within the meaning of the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to the
financial condition, results of operations, plans, objectives, future performance and business of
BNC. Forward-looking statements, which may be based upon beliefs, expectations and
assumptions of our management and on information currently available to management are
generally identifiable by the use of words such as “expect”, “believe”, “anticipate”, “plan”,
“intend”, “estimate”, “may”, “will”, “would”, “could”, “should”, “future” and other expressions
relating to future periods. Examples of forward-looking statements include, among others,
statements we make regarding our belief that we have exceptional liquidity, our expectations
regarding future market conditions and our ability to capture opportunities and pursue growth
strategies, our expected operating results such as revenue growth and earnings, and our
expectations of the effects of the regulatory environment on our earnings for the foreseeable
future.
Forward-looking statements are neither historical facts nor assurances of future
performance.
Our actual results and financial condition may differ materially from those
indicated in the forward-looking statements. Therefore, you should not rely on any of these
forward-looking statements. Important factors that could cause our actual results and financial
condition to differ materially from those indicated in the forward-looking statements include, but
are not limited to: the impact of current and future regulation; the risks of loans and investments,
including dependence on local and regional economic conditions; competition for our customers
from other providers of financial services; possible adverse effects of changes in interest rates,
including the effects of such changes on mortgage banking revenues and derivative contracts and
associated accounting consequences; risks associated with our acquisition and growth strategies;
and other risks which are difficult to predict and many of which are beyond our control. In
addition, all statements in this news release, including forward-looking statements, speak only of
9
the date they are made, and the Company undertakes no obligation to update any statement in
light of new information or future events.
This press release contains references to financial measures which are not defined in generally
accepted accounting principles ("GAAP"). Such non-GAAP financial measures include the
Company’s tangible equity to assets ratio and information presented excluding nonrecurring
transactions. These non-GAAP financial measures have been included as the Company believes
they are helpful for investors to analyze and evaluate the Company’s financial condition.
(Financial tables attached)
# # #
10
BNCCORP, INC.
CONSOLIDATED FINANCIAL DATA
(Unaudited)
For the Quarter
Ended September 30,
(In thousands, except per share data)
2014
For the Nine Months
Ended September 30,
2014
2013
2013
SELECTED INCOME STATEMENT DATA
Interest income
$
Interest expense
7,540
$
5,560
$
21,915
$
16,769
791
944
2,638
2,937
Net interest income
6,749
4,616
19,277
13,832
Provision (reduction) for credit losses
(200)
-
(800)
700
Non-interest income
4,814
5,001
14,459
24,677
Non-interest expense
Income before income taxes
8,765
2,998
9,451
166
25,742
8,794
27,907
9,902
Income tax expense (benefit)
1,017
(321)
2,814
3,154
Net income
1,981
487
5,980
6,748
474
330
1,321
981
Preferred stock costs
$
1,507
$
157
$
4,659
$
5,767
Basic earnings per common share
$
0.44
$
0.05
$
1.38
$
1.75
Diluted earnings per common share
$
0.43
$
0.05
$
1.34
$
1.66
Net income available to common shareholders
EARNINGS PER SHARE DATA
11
BNCCORP, INC.
CONSOLIDATED FINANCIAL DATA
(Unaudited)
(In thousands, except share data)
ANALYSIS OF NON-INTEREST INCOME
Bank charges and service fees
Wealth management revenues
Mortgage banking revenues
Gains on sales of loans, net
Gains on sales of securities, net
Other
For the Quarter
Ended September 30,
For the Nine Months
Ended September 30,
2014
2014
$
2013
743 $
331
2,782
688
-
Subtotal non-interest income
698
302
2,422
301
37
$
2013
2,114
1,066
8,455
1,688
528
$
1,989
935
17,413
1,408
1,247
270
186
608
630
4,814
3,946
14,459
23,622
-
1,055
-
1,055
Life insurance benefits received
Total non-interest income
$
4,814 $
5,001
$
14,459
$
24,677
ANALYSIS OF NON-INTEREST EXPENSE
Salaries and employee benefits
$
4,435 $
3,811
$
13,217
$
13,165
Professional services
848
861
2,237
2,883
Data processing fees
745
717
2,183
2,218
Marketing and promotion
813
718
2,121
1,927
Occupancy
588
597
1,561
1,765
Regulatory costs
158
146
466
680
Depreciation and amortization
315
311
922
928
Office supplies and postage
156
139
495
461
27
38
59
164
680
787
2,481
2,390
8,765
8,125
25,742
26,581
Impairment charge
-
1,500
-
1,500
Post retirement benefits reduction
-
(174)
-
(174)
Other real estate costs
Other
Subtotal non-interest expense
Total non-interest expense
WEIGHTED AVERAGE SHARES
Common shares outstanding (a)
$
8,765 $
$
25,742
$
27,907
3,386,187
3,299,236
3,364,465
3,299,467
116,257
178,265
123,716
172,731
3,502,444
3,477,501
3,488,181
3,472,198
Incremental shares from assumed conversion of
options and contingent shares
Adjusted weighted average shares (b)
9,451
(a) Denominator for basic earnings per common share
(b) Denominator for diluted earnings per common share
12
BNCCORP, INC.
CONSOLIDATED FINANCIAL DATA
(Unaudited)
(In thousands, except share, per share and full time equivalent September 30,
data)
2014
SELECTED BALANCE SHEET DATA
Total assets
Loans held for sale-mortgage banking
Loans and leases held for investment
Total loans
Allowance for credit losses
Investment securities available for sale
Other real estate, net
Earning assets
Total deposits
Core deposits
Other borrowings
Cash and cash equivalents
$
899,720
42,441
335,364
377,805
(8,675)
456,192
1,056
841,712
774,266
720,034
38,032
As of
December 31,
2013
$
28,781
843,123
32,870
317,928
350,798
(9,847)
435,719
1,056
787,519
723,229
658,704
42,399
September 30,
2013
$
18,871
829,232
34,344
294,876
329,220
(9,897)
405,300
2,186
768,732
706,495
641,725
44,452
56,728
OTHER SELECTED DATA
Net unrealized gains (losses) in accumulated other
comprehensive income
Trust assets under supervision
Total common stockholders’ equity
Book value per common share
Book value per common share excluding accumulated
other comprehensive income, net
Full time equivalent employees
Common shares outstanding
$
$
$
$
3,625
255,929
58,658
17.18
$
$
$
$
(1,468)
249,691
48,767
14.45
$
$
$
$
363
256,178
49,032
14.75
$
16.12
255
3,413,854
$
14.89
236
3,374,601
$
14.64
252
3,324,584
CAPITAL RATIOS
Tier 1 leverage (Consolidated)
Tier 1 risk-based capital (Consolidated)
Total risk-based capital (Consolidated)
Tangible common equity (Consolidated)
10.13%
20.22%
21.48%
6.51%
10.94%
21.67%
23.15%
5.79%
10.99%
22.60%
24.18%
5.92%
Tier 1 leverage (BNC National Bank)
Tier 1 risk-based capital (BNC National Bank)
Total risk-based capital (BNC National Bank)
Tangible capital (BNC National Bank)
10.12%
20.34%
21.60%
10.56%
10.06%
20.13%
21.40%
9.82%
10.70%
22.17%
23.43%
10.55%
13
BNCCORP, INC.
CONSOLIDATED FINANCIAL DATA
(Unaudited)
For the Nine Months
Ended September 30,
2014
2013
For the Quarter
Ended September 30,
2014
2013
(In thousands)
AVERAGE BALANCES
Total assets
$
899,665
$
810,301
$
884,649
$
799,101
Loans held for sale-mortgage banking
32,495
46,872
28,215
66,411
Loans and leases held for investment
331,554
277,257
328,464
278,884
Total loans
364,049
324,129
356,679
345,295
Investment securities available for sale
455,368
362,873
444,518
333,761
Earning assets
845,820
750,340
829,801
738,264
Total deposits
772,085
690,320
759,723
679,246
Core deposits
717,708
625,397
700,403
614,239
Total equity
79,138
68,973
75,337
70,312
Cash and cash equivalents
42,986
80,844
45,812
76,583
10.91%
1.25%
11.75%
16.15%
Return on average assets (b)
0.87%
0.24%
0.90%
1.13%
Net interest margin
3.17%
2.44%
3.11%
2.50%
75.80%
98.27%
76.30%
72.47%
-
92.86%
-
70.51%
72.89%
92.65%
70.92%
69.36%
KEY RATIOS
Return on average common stockholders’ equity (a)
Efficiency ratio
Efficiency ratio (Adjusted) (c)
Efficiency ratio (BNC National Bank)
(a) Return on average common stockholders’ equity is calculated by using the net income available to
common shareholders as the numerator and equity (less preferred stock and accumulated other
comprehensive income) as the denominator.
(b) Return on average assets is calculated by using net income as the numerator and average total assets as
the denominator.
(c) Efficiency ratio is adjusted to exclude insurance receipts and impairment charges for the three and nine
month period ending September 30, 2013.
14
BNCCORP, INC.
CONSOLIDATED FINANCIAL DATA
(Unaudited)
As of
September 30,
2014
(In thousands)
ASSET QUALITY
Loans 90 days or more delinquent and still accruing interest
Non-accrual loans
Nonperforming loans
Other real estate, net
Nonperforming assets
$
$
$
Allowance for credit losses
Troubled debt restructured loans
Ratio of nonperforming loans to total loans
Ratio of nonperforming assets to total assets
Ratio of nonperforming loans to total assets
Ratio of allowance for credit losses to loans and leases held for
investment
Ratio of allowance for credit losses to total loans
Ratio of allowance for credit losses to nonperforming loans
$
$
18
112
130
1,056
1,186
$
8,675
5,136
0.03%
0.13%
0.01%
$
$
$
$
15
$
$
961
4,656
5,617
1,056
6,673
$
9,847
8,544
1.60%
0.79%
0.67%
$
$
57
10,072
10,129
2,186
12,315
9,897
8,654
3.08%
1.49%
1.22%
$
$
3.10%
2.81%
175%
3.36%
3.01%
98%
Ended September 30,
2013
3,251
119
(7)
(3,177)
(56)
130
$
September 30,
2013
For the Nine Months
Ended September 30,
2014
Changes in Nonperforming Loans:
Balance, beginning of period
Additions to nonperforming
Charge-offs
Reclassified back to performing
Principal payments received
Transferred to repossessed assets
Transferred to other real estate owned
Balance, end of period
$
2.59%
2.30%
6,673%
For the Quarter
(In thousands)
December 31,
2013
10,183
74
(5)
(12)
(111)
10,129
2014
$
$
5,617
198
(680)
(3,177)
(1,131)
(697)
130
2013
$
10,512
$
811
(909)
(19)
(242)
(24)
10,129
BNCCORP, INC.
CONSOLIDATED FINANCIAL DATA
(Unaudited)
For the Quarter
Ended September 30,
2014
2013
(In thousands)
For the Nine Months
Ended September 30,
2014
2013
Changes in Allowance for Credit Losses:
Balance, beginning of period
$
8,828
Provision (reduction)
Loans charged off
Loan recoveries
Balance, end of period
$
Ratio of net charge-offs to average total loans
Ratio of net charge-offs to average total loans,
annualized
9,898
$
9,847
$
-
(800)
700
(11)
(16)
(705)
(983)
58
15
333
89
8,675
$
9,897
$
8,675
$
Other Real Estate:
Other real estate
Valuation allowance
Other real estate, net
9,897
0.013%
0.000%
(0.104)%
(0.259)%
0.052%
(0.001)%
(0.139)%
(0.345)%
$
1,753
(697)
1,056
$
$
For the Nine Months
Ended September 30,
2014
2013
2,966
800
(1,540)
(40)
2,186
$
$
1,056
697
(697)
1,056
$
$
September 30,
2014
1,754
(698)
1,056
$
$
16
December 31,
2013
$
$
3,250
(2,194)
1,056
$
September 30,
2013
$
$
5,131
800
(3,705)
-
As of
(In thousands)
10,091
(200)
For the Quarter
Ended September 30,
2014
2013
(In thousands)
Changes in Other Real Estate:
Balance, beginning of period
Transfers from nonperforming loans
Transfers from premises and equipment
Real estate sold
Net gains (losses) on sale of assets
Provision
Balance, end of period
$
5,120
(2,934)
2,186
(40)
2,186
BNCCORP, INC.
CONSOLIDATED FINANCIAL DATA
(Unaudited)
As of
September 30,
2014
(In thousands)
December 31,
2013
CREDIT CONCENTRATIONS
North Dakota
Commercial and industrial
$
56,250
$
73,277
Construction
22,609
13,082
Agricultural
18,051
16,847
Land and land development
11,890
10,611
Owner-occupied commercial real estate
28,479
28,435
Commercial real estate
50,280
35,654
1,156
2,188
36,061
31,695
Small business administration
Consumer
Subtotal
$
224,776
$
211,789
$
5,495
$
3,021
Arizona
Commercial and industrial
Construction
124
-
Agricultural
-
-
Land and land development
3,882
5,102
Owner-occupied commercial real estate
1,847
1,571
Commercial real estate
19,190
16,306
Small business administration
24,422
15,502
2,869
2,248
Consumer
Subtotal
$
57,829
$
43,750
$
182
$
794
Minnesota
Commercial and industrial
Construction
-
0
Agricultural
18
21
715
578
-
-
8,922
15,589
37
91
1,315
1,241
Land and land development
Owner-occupied commercial real estate
Commercial real estate
Small business administration
Consumer
Subtotal
$
17
11,189
$
18,314