updated 5/2/2011 5:17:41 PM ET 2011-05-02T21:17:41

GREENSBORO, N.C., May 2, 2011 (GLOBE NEWSWIRE) -- Carolina Bank Holdings, Inc. (Nasdaq:CLBH) today reported first quarter 2011 results with highlights as follows:

First Quarter 2011 Financial Highlights

  • Net income available to common shareholders was $324,000 in the first quarter of 2011 compared to $14,000 in the first quarter of 2010.
  • Diluted net income per common share was $0.10 and $0.00 in the first quarter of 2011 and 2010, respectively.
  • Carolina Bank, the subsidiary of Carolina Bank Holdings, Inc., continued to maintain 'Well Capitalized' status, the highest regulatory capital measure. Capital ratios improved during the first quarter of 2011 and fourth quarter of 2010 due to retained net income and a reduction in assets.
  • Net interest income, computed on a fully taxable basis, was $6.00 million in the first quarter of 2011, up 7.1% from the first quarter of 2010.
  • The net interest margin, computed on a fully taxable basis, increased to a ten year high of 3.88% in the first quarter of 2011 compared to 3.54% in the first quarter of 2010.
  • Provision for loan losses decreased to $1.70 million in the first quarter of 2011 from $1.99 million in the same quarter of 2010. No asset impairment charges were realized in the first quarter of 2011 compared to $0.51 million in the first quarter of 2010.  
  • Net income was $612,000 and $299,000 in the first quarter of 2011 and 2010, respectively.

Robert T. Braswell, President and CEO of Carolina Bank Holdings, Inc., commented, "We are pleased to report another consecutive profitable quarter after the challenging second and third quarters of 2010. Carolina Bank continues to be 'Well Capitalized' and strengthened its capital ratios from retained income and a planned reduction in assets during the first quarter of 2011 and fourth quarter of 2010."

Non-performing loans to total loans held for investment increased to 5.71% at March 31, 2011 from 5.39% at December 31, 2010.  Non-performing assets to total assets increased to 6.00% at March 31, 2011 from 5.55% at December 31, 2010. Braswell commented, "Reducing the elevated level of non-performing assets is a top priority of our Bank in 2011. Our seasoned loan workout team and an improving economy will hopefully provide the keys to reducing our non-performing assets." The bank had net loan charge-offs of $1.65 million and $1.37 million in the first quarter of 2011 and 2010, respectively. The allowance for loan losses was 2.47% and 2.40% of loans held for investment at March 31, 2011 and December 31, 2010, respectively.

About the Company

Carolina Bank, the banking subsidiary of Carolina Bank Holdings, Inc. began banking operations on November 25, 1996. The parent company is a North Carolina corporation organized in 2000. The bank is engaged in lending and deposit gathering activities in the Piedmont Triad of North Carolina, with operations in four counties: Guilford, Alamance, Forsyth and Randolph. The bank has eight full-service banking locations, four in Greensboro, one in Asheboro, one in High Point, one in Burlington, and one in Winston-Salem, North Carolina. A mortgage loan production office was opened in Burlington in July 2010. The Company's stock is listed on the NASDAQ Global Market under the symbol CLBH. Further information is available on the Company's web site: www.carolinabank.com .

This press release contains forward-looking statements regarding future events. These statements are only predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks of managing our growth, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to be materially different from those in the forward-looking statements is contained in the Company's filings with the Securities and Exchange Commission. Carolina Bank Holdings, Inc. undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.

Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Balance Sheets
  March 31, December 31,
  2011 2010
  (unaudited)  
  (in thousands)
Assets    
Cash and due from banks  $ 4,539  $ 5,116
Interest-bearing deposits with banks  46,169  17,710
Securities available-for-sale, at fair value 55,092 46,103
Securities held-to-maturity 506 563
Loans held for sale 16,123 53,961
Loans  501,977 514,029
Less allowance for loan losses (12,414) (12,359)
Net loans  489,563 501,670
Premises and equipment, net 18,541 18,622
Other assets 33,597 32,956
Total assets  $ 664,130  $ 676,701
     
Liabilities and Stockholders' Equity    
Deposits    
Non-interest bearing demand  $ 44,664  $ 43,564
NOW, money market and savings 305,726 303,203
Time 239,005 257,800
Total deposits 589,395 604,567
     
Advances from the Federal Home Loan Bank 3,144 3,165
Securities sold under agreements to repurchase 2,225 432
Subordinated debentures 19,433 19,414
Other liabilities and accrued expenses 5,030 4,841
Total liabilities 619,227 632,419
     
Stockholders' equity    
Preferred stock, no par value, authorized 1,000,000 shares; issued and outstanding 16,000 shares in 2011 and 2010 14,900 14,811
Common stock, $1 par value; authorized 20,000,000 shares; issued and outstanding 3,387,045 in 2011 and 2010 3,387 3,387
Common stock warrants 1,841 1,841
Additional paid-in capital 15,843 15,834
Retained earnings  8,233 7,910
Stock in directors' rabbi trust (733) (718)
Directors' deferred fees obligation 733 718
Accumulated other comprehensive income  699 499
Total stockholders' equity 44,903 44,282
Total liabilities and stockholders' equity  $ 664,130  $ 676,701
 
Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Statements of Income (unaudited)
  Three Months
  Ended March 31, 
  2011 2010
   (in thousands, except per share data)  
     
Interest income    
Loans  $ 7,150  $ 7,476
Investment securities, taxable  401  462
Investment securities, non taxable  162  162
Interest from federal funds sold and other  20  22
Total interest income  7,733  8,122
     
Interest expense    
NOW, money market, savings  660  990
Time deposits  967  1,383
Other borrowed funds  188  229
Total interest expense  1,815  2,602
     
Net interest income  5,918  5,520
Provision for loan losses  1,700  1,988
Net interest income after provision for loan losses  4,218  3,532
Non-interest income    
Service charges  231  216
Mortgage banking income  1,635  1,749
Gains on sale of investment securities  97  130
Repossessed asset losses  --  (127)
Other  147  165
Total non-interest income  2,110  2,133
     
Non-interest expense    
Salaries and benefits  2,964  2,573
Occupancy and equipment  638  608
Professional fees  253  260
Outside data processing  219  241
FDIC insurance  385  257
Advertising and promotion  87  153
Stationery, printing and supplies  139  114
Impairment of repossessed assets  --  507
Repossessed asset expenses  294  163
Other  491  402
Total non-interest expense  5,470  5,278
     
Income before income taxes  858  387
Income tax expense  246  88
Net income  612  299
Dividends and accretion on preferred stock  288  285
Net income available to common stockholders  $ 324  $ 14
     
Net income per common share    
Basic  $ 0.10  $ -- 
Diluted  $ 0.10  $ -- 
 
Carolina Bank Holdings, Inc.
Consolidated Financial Highlights 
First Quarter 2011
(unaudited)
  Quarterly  Years Ended
  1st Qtr. 4th Qtr. 3rd Qtr. 2nd Qtr. 1st Qtr.    
($ in thousands except for share data) 2011 2010 2010 2010 2010 2010 2009
               
EARNINGS              
Net interest income $5,918 6,170 5,981 5,670 5,520  23,341  19,705
Provision for loan loss $1,700 1,825 6,620 4,700 1,988  15,133  10,520
NonInterest income $2,110 4,710 4,030 2,502 2,133  13,375  10,550
NonInterest expense $5,470 8,190 6,421 6,172 5,278  26,061  20,577
Net income (loss)  $612 679 (1,804) (1,568) 299  (2,394)  (358)
Net income (loss) available to common stockholders $324 392 (2,086) (1,856) 14  (3,536)  (1,448)
Basic earnings (loss) per share $0.10 0.12 (0.62) (0.55) 0.01  (1.04)  (0.43)
Diluted earnings (loss) per share $0.10 0.12 (0.62) (0.55) 0.01  (1.04)  (0.43)
Average shares outstanding 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045  3,383,748
Average diluted shares outstanding 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045  3,385,102
               
PERFORMANCE RATIOS              
Return on average assets * 0.20% 0.22% -1.19% -1.06% 0.01% -0.51% -0.22%
Return on average common equity * 4.41% 5.24% -26.45% -22.54% 0.17% -11.08% -4.21%
Net interest margin (fully-tax equivalent) * 3.88% 3.80% 3.70% 3.50% 3.54% 3.63% 3.20%
Efficiency ratio 67.47% 74.73% 63.64% 74.80% 68.24% 70.38% 67.42%
# full-time equivalent employees - period end  163  155  153  147  143  155  140
               
CAPITAL              
Equity to ending assets 6.76% 6.54% 6.36% 6.58% 6.83% 6.54% 6.88%
Common tangible equity to assets 4.53% 4.36% 4.25% 4.50% 4.77% 4.36% 4.80%
Tier 1 leverage capital ratio - Bank 7.91% 7.59% 7.43% 7.23% 7.54% 7.59% 7.45%
Tier 1 risk-based capital ratio - Bank 9.38% 9.00% 8.73% 8.55% 8.59% 9.00% 8.50%
Total risk-based capital ratio - Bank 12.24% 11.82% 11.52% 11.34% 11.34% 11.82% 11.24%
Book value per common share $8.86  8.70 8.79 9.37 9.91 8.70 9.88
               
ASSET QUALITY              
Net charge-offs (recoveries) $1,645  1,096  5,261  5,126  1,372  12,855  6,199
Net charge-offs to average loans * 1.29% 0.84% 4.02% 3.80% 1.03% 2.43% 1.19%
Allowance for loan losses $12,414 12,359 11,629 10,270 10,697 12,359 10,081
Allowance for loan losses to loans held invst. 2.47% 2.40% 2.24% 1.93% 2.00% 2.40% 1.90%
Nonperforming loans $28,651 27,713 26,972 24,721 19,636 27,713 14,163
Performing restructured loans $11,910 8,396 700  --   --  8,396  --
Repossessed assets $11,177 9,863 9,763 7,792 11,507 9,863 13,964
Nonperforming loans to loans held for investment 5.71% 5.39% 5.20% 4.63% 3.68% 5.39% 2.67%
Nonperforming assets to total assets 6.00% 5.55% 5.25% 4.62% 4.42% 5.55% 4.04%
               
END OF PERIOD BALANCES              
Total assets $664,130 676,701 700,234 704,340 704,085 676,701 697,052
Total loans held for investment $501,977 514,029 519,177 533,486 534,045 514,029 530,606
Total deposits $589,395 604,567 626,060 626,527 625,730 604,567 617,471
Stockholders' equity $44,903 44,282 44,507 46,359 48,112 44,282 47,948
               
AVERAGE BALANCES              
Total assets $673,663 693,279 698,106 700,598 691,406 695,847 665,555
Total earning assets $626,822 653,276 650,068 658,491 641,861 650,926 624,031
Total loans held for investment  $510,051 521,462 523,714 539,554 532,928 529,415 522,965
Total interest-bearing deposits  $555,381 574,181 580,084 584,031 576,968 578,815 528,158
Common stockholders' equity $29,795 29,702 31,295 33,034 33,666 31,924 34,385
               
* annualized for all periods presented
Return on average assets and on average common equity are computed using net income (loss) available to common stockholders
CONTACT: Carolina Bank Holdings, Inc.
         Robert T. Braswell, President and CEO
         Telephone: 336-286-8740
         Email: b.braswell@carolinabank.com

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