ELKIN, NC — (Marketwired) — 10/24/13 — Yadkin Financial Corporation (NASDAQ: YDKN)
Net income available to common shareholders for the third quarter of 2013 was $4.3 million, or $0.30 per diluted share.
The average net interest margin for the quarter was 3.93%, an increase of 3 basis points compared to the prior quarter.
Total loan balances increased $18.7 million compared to the prior quarter, our second consecutive quarter of loan growth.
Nonperforming assets decreased for the fourth consecutive quarter, ending the quarter at 1.15% of total assets.
The Company continues to demonstrate a strong capital position, as evidenced by our Tier 1 leverage, Tier 1 risk-based, and total risk-based capital levels at the Bank. These ratios were 10.9%, 12.9%, and 14.2%, respectively, at September 30, 2013
Yadkin Financial Corporation (NASDAQ: YDKN), the holding company for Yadkin Bank, announced today financial results for the third quarter ended September 30, 2013. Net income available to common shareholders for the quarter was $4.3 million, or $0.30 per diluted share, compared to net income of $4.2 million, or $0.30 per diluted share, in the second quarter of 2013, and net loss of $81,000, or $0.01 per diluted share, in the third quarter of 2012.
Joe Towell, President and CEO of Yadkin Financial, commented, “We continue to demonstrate that 2013 is about solid profitability at Yadkin. I-m proud of our team for driving results as we work in a very competitive banking environment in the Carolinas. We continued our trends in growing loans, reducing nonperforming assets, and increasing our net interest margin. We are pleased to maintain attractive credit metrics while growing our loan portfolio, primarily in our desired categories of commercial and industrial, owner occupied real estate, and consumer.
“Clearly, we have shown that our Board, management team, and employees are laser-focused on our success. We are looking forward to finishing the year strong and moving into 2014 with momentum and opportunity ahead of us. Our core bank continues to show its strengths in terms of quality loan growth and core deposit acquisition. Our mortgage and wealth management divisions continue to drive our non-interest income with their strong performances during 2013, and our focus on enhancing the customer experience has allowed us to better serve our existing customers and attract new customers.
“While our industry and our economy continue to improve, we are pleased with our results through three quarters of 2013.”
The Bank-s key asset quality metrics continue to be strong as we maintain a clean credit profile. First, our adversely classified items to Tier 1 capital and loan loss reserve ratio has continued to decrease, down to 22.02% at the end of the third quarter. Our nonperforming loans decreased $1.8 million compared to the prior quarter, to $17.9 million at September 30, 2013. In addition, the nonperforming loans to total loans ratio decreased to 1.33% at September 30, 2013, compared to 1.47% at June 30, 2013.
Other real estate owned (OREO) totaled $3.0 million at September 30, 2013, a decrease of $823,000 compared to $3.8 million at June 30, 2013. Total nonperforming assets at September 30, 2013 were $20.9 million, or 1.15% of total assets, a decrease of $2.6 million from June 30, 2013.
During the third quarter of 2013, the provision for loan losses was $40,000, a decrease of $15,000 from the second quarter of 2013. This decrease is due to the continued clean credit profile of the Company and the reduction in loans moving to nonperforming and classified status. Total net charge-offs for the third quarter of 2013 were $2.0 million, or 0.58% of average loans on an annualized basis.
At September 30, 2013, the allowance for loan losses was $21.0 million, compared to $22.9 million at June 30, 2013. As a percentage of total loans held-for-investment, the allowance for loan losses was 1.58% in the third quarter of 2013, down from 1.74% in the second quarter of 2013. While credit quality has improved, the reserve remains at a robust level due to continued economic uncertainty and other external factors in our markets. Out of the $21.0 million in total allowance for loan losses at September 30, 2013, the specific allowance for impaired loans accounted for $400,000, down from $2.0 million in the second quarter. The remaining general allowance of $20.6 million attributed to unimpaired loans was down from $20.9 million at the end of the second quarter.
Net interest income was essentially flat at $16.1 million compared to the prior quarter. Our net interest margin continued to expand with the quarterly average margin increasing 3 basis points to 3.93%, up from 3.90% at June 30, 2013. This increase in margin is due to our continued loan growth, consistent yield on loans, lower cost of deposits, and slower prepayment speeds in our securities portfolio.
In the third quarter of 2013, we continued to strategically shift our deposit mix and lower our cost of deposits. Core deposits now represent 63.3% of total deposits, our highest percentage in the last eight quarters, as we focus on core deposit growth. As a result of this strategy, our cost of deposits decreased to 0.51% for the quarter as compared to 0.55% in the second quarter of 2013.
Non-interest income decreased $803,000 to $5.4 million in the third quarter compared to $6.2 million in the second quarter of 2013. This decrease is due primarily to a slowdown in the velocity of rate increases during the quarter, which impacts our mortgage income. This was offset by $310,000 in gains as a result of the branch sale executed during July 2013. While our mortgage portfolio is strong, income from this portfolio could moderate over the coming quarters due to anticipated trends in rate movement.
Non-interest expense decreased $693,000 during the third quarter, down to $14.2 million as compared to $14.8 million in the second quarter. The second quarter of 2013 included expenses related to our rebranding initiative, as well as additional fees incurred as a result of the Company-s 1-for-3 reverse stock split, which caused the increase in expense during the prior quarter.
Total assets increased $11.6 million during the third quarter of 2013 as we begin to expand our loan portfolio due to our focus on quality loan growth. Total loans increased $18.7 million as compared to the prior quarter, marking our second consecutive quarter of loan growth. The decrease in total deposits of $31.8 million consisted primarily of a reduction in higher cost time deposits. Core deposits increased $4.4 million compared to the prior quarter, representing our fifth consecutive quarter of core deposit increase.
The Company-s capital ratios have strengthened and continue to exceed all regulatory requirements. As of September 30, 2013, the Bank-s leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio were 10.9%, 12.9%, and 14.2%, respectively. Leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio were 11.1%, 13.2%, and 14.4% respectively, for the holding company as of September 30, 2013. In addition, the Company-s tangible common equity to total tangible assets ratio was 8.2% at the end of the third quarter, compared to 8.0% at June 30, 2013. For capital adequacy purposes, leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio must be in excess of 5.0%, 6.0%, and 10.0%, respectively, to be considered well-capitalized.
Yadkin Financial Corporation will host a conference call at 10:00 a.m. EDT on Thursday, October 24, 2013 to discuss financial results, business highlights, and outlook. The call may be accessed by dialing 877-312-5527 at least 10 minutes prior to the call. A webcast of the call audio may be accessed at . A replay of the call will be available until October 30, 2013 by dialing 855-859-2056 or 404-537-3406 and entering Conference ID 87522497.
Yadkin Financial Corporation is the holding company for Yadkin Bank, a full-service community bank with 33 branches throughout its two regions in North Carolina and South Carolina. The Western Region serves Avery, Watauga, Ashe, Surry, Wilkes, Yadkin, Durham, and Orange Counties. The Southern Region serves Iredell, Mecklenburg, and Union Counties in North Carolina, and Cherokee and York Counties in South Carolina. The Bank provides mortgage-lending services through its mortgage division, Yadkin Mortgage, headquartered in Greensboro, NC. Securities brokerage services are provided by Yadkin Wealth, Inc., a Bank subsidiary with offices located throughout the branch network. Yadkin Financial Corporation-s website is . Yadkin shares are traded on NASDAQ under the symbol YDKN.
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This news release contains forward-looking statements, as defined by Federal Securities Laws, including statements about financial outlook and business environment. Forward looking statements generally include words such as “expects,” “projects,” “anticipates,” “believes,” “intends,” “estimates,” “strategy,” “plan,” “potential,” “possible” and other similar expressions. These statements are provided to assist in the understanding of future financial performance and such performance involves risks and uncertainties that may cause actual results to differ materially from those anticipated in such statements. Any such statements are based on current expectations and involve a number of risks and uncertainties. For a discussion of some factors that may cause such forward-looking statements to differ materially from actual results, please refer to the section entitled “Forward Looking Statements” on pages 44-45 of Yadkin Financial Corporation-s quarterly report filed on Form 10-Q with the SEC for the quarter ended September 30, 2013 and in the sections entitled “Forward Looking Statements” in quarterly reports filed on Form 10-Q for the quarters ended June 30, 2013, March 31, 2013, and September 30, 2012, and in the section entitled “Risk Factors” in the annual report filed on Form 10-K for the year ended December 31, 2012. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.
For additional information contact:
Joseph H. Towell
President and Chief Executive Officer
(704) 768-1133
Jan H. Hollar
Executive Vice President and Chief Financial Officer
(704) 768-1161