First South Bancorp Inc., the parent holding company of First South Bank, reports its unaudited financial results for the quarter ended March 31.

The company continues to achieve strong earnings and margin expansion through robust loan and deposit growth. The company generated net income for the first quarter of 2017 of $1.9 million, which represented a $411,000 or 28.2-percent increase when compared to the $1.5 million of net income generated in the first quarter of 2016. As a result, the company’s diluted earnings per common share for the first quarter of 2017 increased 33.3 percent to $0.20 per share, from $0.15 per share for the first quarter of 2016. The net interest margin for the quarter ended March 31 was 3.74 percent, an eight-basis point increase above the 3.66 percent posted for the first quarter of 2016. Over the past 12 months, loans and leases held for investment and total deposits have grown $88.1 million and $101.2 million, respectively, bringing total assets to in excess of $1 billion.

Chief Executive Officer Bruce Elder said, “We are pleased to announce another quarter of solid financial results. We have again demonstrated our ability to grow the balance sheet in a profitable fashion while driving efficiencies by continuing to analyze how we deliver ‘You First’ banking to our customer base. Our growth of loans and deposits over the last 12 months has generated increases in net interest income and core, non-interest income. Coupled with controlled non-interest expenses, our growth has translated into improved earnings, higher margins and dividend levels, greater efficiency and improved returns on average assets and equity from the prior year first quarter.”

 

HIGHLIGHTS

 

• Strong quarterly earnings performance with net income of $1.9 million, diluted EPS of $0.20 per share, return on average assets of 0.75 percent, return on average equity of 8.52 percent and return on average tangible common equity of 9.32 percent.
• Pre-tax, pre-provision operating earnings for the quarter of $3 million are 48 percent higher than the $2 million reported for the prior year first quarter.
• Total assets grew to $1.04 billion at March 31, the company’s first quarter-end reporting period to surpass the billion-dollar threshold.
• Loans and leases HFI grew $88.1 million or 13.8 percent during the past 12 months to $727.1 million.
• Deposits grew $101.2 million or 12.4 percent during the past 12 months to $919.9 million.
• Total non-interest bearing deposits grew 24.6 percent to $204.6 million on a year-over-year basis.
• Net interest margin expanded to 3.74 percent for the quarter, compared to 3.66 percent for the first quarter of 2016.
• Asset quality metrics continue to improve.
• Continued to maintain a strong capital position.
• The consolidation of two branches into nearby locations should improve future efficiency.
• Increased quarterly dividend payment rate to $0.035 per share, a 16.7-percent increase.

 

On Thursday, the company’s Board of Directors declared a quarterly cash dividend of $0.035 per share, payable May 19, to shareholders of record as of the close of business on May 8.

This dividend payment is the company’s 13^th-consecutive quarterly cash dividend and represents a payout ratio of 17.5 percent of first quarter 2017 diluted earnings per share.

First South Bank has been serving the citizens of eastern and central North Carolina since 1902 and offers a variety of financial products and services to business and individual customers. The bank operates through its main office headquartered in Washington and has 28 full-service branch offices located throughout eastern and central North Carolina.