News Column

BNC Bancorp net income in 4Q declines on higher expenses

January 24, 2014

By Richard Craver, Winston-Salem Journal, N.C.

Jan. 24 --Higher expenses related to its growth spurt contributed to BNC Bancorp having a 26.4 percent decline in net income to $3.27 million in the fourth quarter. The bank reported today diluted earnings of 12 cents a share, down 7 cents from a year ago. The average earnings forecast was 18 cents by three analysts surveyed by Zacks Investment Research . Analysts typically do not include one-time gains and charges in their forecasts. BNC's recent bank acquisitions in the Carolinas enabled it to be one of the few banks serving the Triad to post solid loan revenue growth during the quarter. It was up 47.6 percent to $27.4 million . However, its fee revenue was down 50 percent to $5.2 million when compared with the fourth quarter of 2012. In that quarter, BNC gained nearly $5 million from a one-time acquisition initiative, as well as $651,000 from a sale of securities. Expenses rose 15 percent in the fourth quarter to $28.3 million . Like most large and community banks serving the Triad, BNC benefited from more improvements in its loan portfolio as more consumers were able to make on-time loan payments. BNC reduced its provision for loan losses to $2.43 million in the fourth quarter compared with $5.5 million a year ago. Lowering the provision is considered to be a key financial metric given that it comes off banks' bottom lines. Nonperforming assets were at $45.9 million on Dec. 31 compared with $50.6 million on Sept. 30 and $51.2 million on Dec. 31, 2012 . Net charge-offs were $3.8 million on Dec. 31 compared with $4.8 million on Sept. 30 and $6.3 million on Dec. 31, 2012 . For fiscal 2013, BNC's net income was up 101 percent to $16.2 million . Loan revenue rose 66.6 percent to $96.4 million , while fee income was down 31 percent to $22.8 million . "The fourth quarter and all of 2013 were pivotal in solidifying the core earnings power of our organization," Richard Callicutt II , president and chief executive, said in a statement. "We saw significant improvement in all of our key credit metrics, while growing non-acquired loans by more than 17 percent." Total assets were at $3.2 billion at Dec. 31 compared with $3.08 billion at Dec. 31, 2012 . (336) 727-7376 ___ (c)2014 Winston-Salem Journal (Winston Salem, N.C.) Visit Winston-Salem Journal (Winston Salem, N.C.) at Distributed by MCT Information Services

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Source: Winston-Salem Journal (NC)

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