Summit State Bank Reports a 10% Increase in Net Income for 2015 and Declaration of Dividend
SANTA ROSA, CA – (January 26, 2016) – Summit State Bank (Nasdaq: SSBI) today reported net income for the year ended December 31, 2015 of $6,030,000, a 10% increase over 2014. Basic earnings per share increased to $1.24 in 2015 from $1.12 in 2014. A quarterly dividend of $0.12 per share was declared for common shareholders.
Dividend
The Board of Directors declared a $0.12 per share quarterly dividend to be paid on February 24, 2016 to shareholders of record on February 18, 2016.
Net Income and Results of Operations
"Summit continues to record strong operating performance as a result of the high quality of our community banking team and their deep commitment to our Sonoma County community and ability to attract and expand full banking relationships by providing the best customer service experience and customized financial solutions through The Summit Way brand of community banking. We are looking forward to another successful year in 2016," said Thomas Duryea, President and CEO.
The year ended December 31, 2015 had many accomplishments. Some of the financial highlights were:
• 1.24% Return on Assets (ROA)
• 9% dividend increase to 48 cents
• 22% increase in net loan balances
• 20% increase in demand deposits
• 53.8% Efficiency ratio
• 0.31% nonperforming asset ratio
• Retirement of Small Business Lending Fund Preferred stock
For the year ended December 31, 2015, net income was $6,030,000, net income available for common stockholders, which deducts the preferred dividends, of $5,938,000, and $1.23 diluted earnings per share, compared to net income of $5,485,000, net income available for common stockholders of $5,347,000, and $1.11 diluted earnings per share, for the year ended December 31, 2014.
For the quarter ended December 31, 2015, Summit State Bank had net income and net income available for common stockholders of $1,284,000 and diluted earnings per share of $0.27 compared to $1,810,000 in net income, $1,776,000 net income available for common stockholders, or $0.37 diluted earnings per share, for the same period in 2014.
During the annual and fourth quarter periods of 2015 and 2014, there were isolated impacts to the results, predominantly due to the improvement of asset quality. In 2015, Summit State Bank reversed $800,000 for the year and no reversal in the fourth quarter, of allowance for loan losses and recognized a gain on the sale of foreclosed real estate of $1,125,000 for the year and no sales in the fourth quarter. In 2014, there was $1,400,000 for the year and $1,000,000 in the fourth quarter of reversal of the allowance for loan losses and gains on sale of foreclosed properties of $73,000 for the year and no sales in the fourth quarter. Without these items, net income would have increased for the 2015 year by 6% and between the fourth quarters by 5%.
Return on average assets improved in 2015 to 1.24% from 1.19% in 2014 and return on average common equity was 10.6% for 2015 compared to 10.4% in 2014. Without the positive impacts of the provision for loan loss reversals and gains on foreclosed property sales, the return on average assets and average common equity was 1.01% and 8.59% for the year ended December 31, 2015, compared to 2014 return on average assets and average common equity of 1.00% and 6.91%.
Total assets were $513,365,000 at December 31, 2015 compared to $459,675,000 at December 31, 2014, representing an annual increase of 11.7%.
The increase in assets was predominantly from a 22% increase in net loans.
"We are extremely pleased with our growth in 2015. Our ability to attract and retain top quality clients in Sonoma County is a direct reflection of the excellent team we have and the ‘can-do’ Summit Way culture we stand for. We are committed to Sonoma County and look forward to another great year of investing in it," said Brandy Seppi, Chief Credit Officer and Executive Vice President.
The asset growth was funded primarily by a $27,942,000 or 13% increase in Core relationship deposits - demand, savings and money market deposits – driven primarily by demand deposit increases, between December 31, 2015 and December 31, 2014. Demand deposits currently represent 39% of total deposits.
"We have achieved another year of strong results and remain ever committed to increasing our funding of loans through core deposit relationships, largely DDA, which drive franchise and shareholder value, and provide the proper foundation to continue to support and sustain our community’s small businesses and nonprofits in 2016 and beyond," said Linda Bertauche, Chief Operating Officer and Executive Vice President.
About Summit State Bank
Summit State Bank, a local community bank, has total assets of $513 million and total equity of $57 million at December 31, 2015. Headquartered in Sonoma County, the Bank specializes in providing exceptional customer service and customized financial solutions to aid in the success of local small businesses and nonprofits throughout Sonoma, Napa, San Francisco, and Marin Counties.
Summit State Bank’s workforce resembles the diverse community it serves. Presently, 80% of management are women and minorities with 50% represented on the Executive Management Team. Through the inclusion and engagement of its workforce, Summit State Bank has earned many prestigious awards including: Best Company to do Business with in Sonoma County by the Northbay Biz magazine; Best Places to Work in the North Bay by the North Bay Business Journal; Super Performing Bank by Findley Reports; and Top 75 Corporate Philanthropists in the San Francisco Bay Area by the San Francisco Business Times. Summit State Bank’s stock is traded on the Nasdaq Global Market under the symbol SSBI. Further information can be found at www.summitstatebank.com.
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