Peoples Financial Corporation Second Quarter Income Increases 11% Over First Quarter

Wed Jul 25, 2012 4:31pm EDT

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Peoples Financial Corporation Second Quarter Income Increases 11% Over First Quarter

First half earnings decline from 2011 due to increased loan loss provision

PR Newswire

BILOXI, Miss., July 25, 2012 /PRNewswire/ -- Peoples Financial Corporation (NASDAQ Capital Market: PFBX), parent of The Peoples Bank, recorded second quarter 2012 net income of $562,000, an increase of 11% over the first quarter of 2012, announced Chevis C. Swetman, Chairman and Chief Executive Officer of the holding company and the bank.

Earnings per weighted average share for second quarter of 2012 totaled $.11 compared to $.10 per weighted average share in the first quarter of the year. Earnings per share figures are based on weighted average shares outstanding of 5,136,918 as of June 30, 2012 and March 31, 2012.

Net income in the first six months of 2012 totaled $1,067,000, down 14% from the first half of 2011, due mainly to an increase in the provision for loan losses during the second quarter of 2012.

"This past quarter was solid although by no means spectacular," said Swetman. "The major impact on our earnings for the quarter came from one loan that increased our loss provision substantially over the last several quarters," he added.

The provision for loan losses in the latest quarter increased to $1,290,000, compared to $546,000 in the same quarter of 2011. Since the beginning of 2011, quarterly loan loss provisions have averaged about half the amount of the latest period, noted Swetman. The quarter's larger provision was partially offset by a gain on sale of securities totaling $567,000, net of taxes.

The allowance for loan losses as of June 30, 2012 totaled $6,743,000, compared to $6,713,000 at the same time last year. Loans more than 90 days past due and still accruing have declined 94% from the same period a year ago from $1,195,000 to only $67,000.  "This is probably the lowest this number has ever been," said Swetman.  In addition, loans on nonaccrual have declined from their peak of $57,592,000 as of December 31, 2011 to $54,968,000 at June 30, 2012.

"We continue the long, painful process of cleaning up our loan portfolio and strengthening our balance sheet to prepare for more robust growth when the economy finally begins a sustainable rebound," said Swetman.

Loan volume at the end of the first half of 2012 increased 9% over the first half of 2011, from $393.4 million to $427.6 million.

The bank's primary capital ratio increased to 14.05% at the end of the second quarter of 2012, compared to 13.94% at the end the same period in 2011, the highest level of capital since 2004.

Founded in 1896, with $853 million in assets as of June 30, 2012, The Peoples Bank operates 16 branches along the Mississippi Gulf Coast in Hancock, Harrison, Jackson and Stone counties. In addition to a comprehensive range of retail and commercial banking services, the bank also operates a trust and investment services department that has provided customers with financial, estate and retirement planning services since 1936. 

The Peoples Bank is a wholly-owned subsidiary of Peoples Financial Corporation, listed on the NASDAQ Capital Market under the symbol PFBX. Additional information is available on the Internet at www.thepeoples.com.

This news release contains forward-looking statements and reflects industry conditions, company performance and financial results. These forward-looking statements are subject to a number of risk factors and uncertainties which could cause the Company's actual results and experience to differ from the anticipated results and expectation expressed in such forward-looking statements.

PEOPLES FINANCIAL CORPORATION


as of 7/18/12





(In thousands, except per share figures) (Unaudited)
















EARNINGS SUMMARY


Three Months Ended June 30,


Six Months Ended June 30,



2012


2011


2012


2011

Net interest income


$               5,698


$                5,687


$ 11,286


$ 11,549

Provision for loan losses


1,290


546


1,830


1,187

Non-interest income


2,897


2,451


5,016


4,474

Non-interest expense


6,800


6,975


13,552


13,931

Income taxes


(57)


(192)


(147)


(342)

Net income


562


809


1,067


1,247

Earnings per share


.11


.16


.21


.24










TRANSACTIONS IN THE ALLOWANCE FOR LOAN LOSSES







Three Months Ended June 30,


Six Months Ended June 30,



2012


2011


2012


2011

Allowance for loan losses, beginning of period

$               8,048


$                7,105


$   8,136


$   6,650

Recoveries


13


79


70


193

Charge-offs


(2,608)


(1,017)


(3,293)


(1,317)

Provision for loan losses


1,290


546


1,830


1,187

Allowance for loan losses, end of period


$               6,743


$                6,713


$   6,743


$   6,713










ASSET QUALITY


June 30,







2012


2011





Allowance for loan losses as a 









   percentage of loans


1.58%


1.71%





Loans past due 90 days and 









   still accruing


$                    67


$                1,195





Nonaccrual loans


54,968


32,562














PERFORMANCE RATIOS (annualized)


June 30,







2012


2011





Return on average assets


.26%


.31%





Return on average equity


1.94%


2.40%





Net interest margin


3.04%


3.31%





Efficiency ratio


94%


94%





Primary capital


14.05%


13.94%














BALANCE SHEET SUMMARY


June 30,







2012


2011





Total assets


$           852,608


$            821,215





Securities


340,150


327,442





Loans


427,591


393,390





Other real estate


7,523


8,163





Total deposits


481,569


498,419





Total federal funds purchased


161,988


169,044





Shareholders' equity


110,728


106,247





Book value per share


21.56


20.68





Weighted average shares


5,136,918


5,136,918





SOURCE Peoples Financial Corporation

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