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Bank of McKenney Q2 earnings $376,000

Staff writer ▼ | September 28, 2015
Bank of McKenney announced earnings of $376,000 for the second quarter ending June 30, 2015, compared to net income of $539,000 for the same period in 2014.
Bank of McKenney
Bank of McKenney   The reduction of income
The reduction of income was largely attributable to a non-recurring gain as a result of sales in the OREO portfolio in 2014 of $232,000. Basic and diluted earnings per share of $0.20 were recorded for the three months ended June 30, 2015.

Return on average equity on an annualized basis for the six months ended June 30, 2015 was 6.36% as compared to 7.85% for the first half of 2014. Return on average assets during the same period of 2015 decreased to 0.70% from the prior year level of 0.81%. For the rolling twelve month period ended June 30, 2015, return on average equity was 7.40% and return on average assets was .81%.

Tier 1 leverage capital was 11.12% and total regulatory capital was 14.79% as of June 30, 2015 compared to 10.84% and 14.42% respectively at December 31, 2104.

At the end of the second quarter, total assets were $217.1 million, representing a .5% increase over the December 31, 2014 level of $216.1 million. Loans increased $5.4 million to 166.7 million compared to the balance at December 31, 2014.

The investment portfolio decreased $5.4 million over the same period. Federal funds sold increased from $8.8 million on December 31, 2014 to $10.1 million on June 30, 2015.

Cumulatively, earning assets grew $1.6 million in the first six months of 2015, and represent 90.9% of total assets. Other Real Estate Owned (OREO) amounted to $773,000 and $1.6 million at June 30, 2015 and December 31, 2014, respectively.

Total deposits amounted to $189.6 million at June 30, 2015 compared to $189.2 million at December 31, 2014. Total shareholders' equity has increased $758 million year-to-date.

Net interest income increased 2.41% or $55,000 to $2.4 million in the first quarter of 2015 from the comparable period in 2014. Increased loan volume and lower interest expense due to rate changes and fewer interest-bearing deposits provided for the increase.

As previously discussed, there was a provision for loan loss in the quarter of $300,000 compared to $50,000 in the same period of 2014. Noninterest income was $252,000 less than the second quarter of 2014 due to a non-recurring gain on the sale of OREO in 2014.

Noninterest expenses were $200,000 less due to cost containment efforts and reversal of some incentive accruals.