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National Commerce Corporation Announces Second Quarter 2015 Earnings

20:00 EDT 22 Jul 2015 | Globe Newswire

BIRMINGHAM, Ala., July 23, 2015 (GLOBE NEWSWIRE) -- National Commerce Corporation (NASDAQ:NCOM) (the "Company") today reported second quarter 2015 net income to common shareholders of $2.3 million, compared with $1.1 million for the second quarter of 2014. Diluted net earnings per share were $0.24 for the second quarter of 2015, compared with $0.20 for the second quarter of 2014, representing a 20% increase.

"We are pleased with the first six months of the year," said John H. Holcomb, III, Chairman and CEO of the Company. "Our growth continues to meet our expectations, and I am also encouraged by the growth we are experiencing in our United Legacy market area following the March conversion of United Legacy to our core operating system. While the year is off to a good start, we again remind ourselves that we have a lot of work ahead of us to continue to achieve our goals."

Several important measures from the second quarter of 2015 are as follows:

  • Net Interest Margin (tax-effected) of 4.22%, compared with 3.29% for the second quarter of 2014.
  • Return on Average Assets of 0.75%, compared with 0.61% for the second quarter of 2014.
  • Return on Average Tangible Common Equity of 6.35%, compared with 5.00% for the second quarter of 2014.
  • Second quarter 2015 loan growth (excluding mortgage loans held for sale) of $49.9 million, representing a 21.7% annualized growth rate. Excluding factoring receivables, loans grew $44.5 million, representing a 20.9% annualized growth rate.
  • Second quarter 2015 deposit growth of $51.3 million, representing a 20.6% annualized growth rate.
  • $84.8 million in mortgage production, compared with $56.5 million for the second quarter of 2014.
  • $189 million in purchased volume in the factoring division. Note that, because the Company entered the factoring business in the third quarter of 2014, no comparable figure is available for the second quarter of 2014.
  • Increase in non-acquired non-performing assets to $4.2 million from $2.3 million at March 31, 2015.
  • Annualized net charge-offs of 0.16%, compared to 0.13% for the second quarter of 2014.
  • Ending tangible book value per share of $15.12.
  • Ending book value per share of $18.50.

"I am also pleased about our recent announcement with Reunion Bank of Florida," continued Holcomb. "We believe the cultural fit between our organizations is outstanding, and we are excited about adding the Reunion team and shareowners to the National Commerce family."

The Company will host a live audio webcast conference call beginning at 9:00 a.m. Central Time on July 24, 2015 to discuss second quarter 2015 results. Investors may call in (toll free) by dialing (855) 871-0559 (conference ID 82247899). A replay of the conference call will be available beginning two hours after the completion of the call until 10:59 p.m. Central Time on Sunday, July 26, 2015 and can be accessed by dialing (855) 859-2056.

Investors who plan to participate in the live webcast of the conference call should access the webcast by visiting the Company's Investor Relations page located at www.nationalbankofcommerce.com. A replay of the webcast will be available on the website for one year. A copy of this press release will also be available at the same location.

Use of Non-GAAP Financial Measures

Some of the financial measures presented in this press release and included in the accompanying unaudited financial statements are not measures prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). These non-GAAP financial measures include tangible common equity, return on average tangible common equity, tangible book value per share, allowance for loan losses to nonacquired loans, efficiency ratio and operating efficiency ratio. Our management uses the non-GAAP financial measures set forth below in its analysis of the Company's performance.

  • "Tangible common equity" is total shareholders' equity less goodwill, other intangible assets and minority interest not included in intangible assets.
  • "Average tangible common equity" is defined as the average of our tangible common equity for the applicable period.
  • "Return on average tangible common equity," or ROATCE, is defined as net income available to common shareholders divided by average tangible common equity.
  • "Tangible book value per share" is defined as tangible common equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.
  • "Allowance for loan losses to nonacquired loans" is defined as the total allowance for loan losses less the allowance for loan losses attributable to factored receivables divided by nonacquired loans held for investment excluding factored receivables at end of the period.
  • "Efficiency ratio" is defined as noninterest expense divided by our operating revenue (which is equal to net interest income plus noninterest income) excluding one-time gains and losses on sales of securities. This measure is important to investors looking for a measure of efficiency in our productivity measured by the amount of revenue generated for each dollar spent.
  • "Operating efficiency ratio" is defined as noninterest expense divided by our operating revenue, excluding one-time gains and losses on sales of securities and one-time gains and expenses related to merger and acquisition-related activities. This measure is important to investors looking for a measure of efficiency in our productivity measured by the amount of revenue generated for each dollar spent.

We believe that these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that our non-GAAP financial measures have a number of limitations. As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies use. These non-GAAP financial measures exclude various items detailed in the attached "Non-GAAP Reconciliation."

About National Commerce Corporation

National Commerce Corporation ("NCC") is a bank holding company headquartered in Birmingham, Alabama.  Through its subsidiary bank, National Bank of Commerce, NCC provides a broad array of financial services to businesses, business owners and professionals through eight full-service banking offices in Alabama (in Birmingham, Huntsville, Auburn-Opelika and Baldwin County) and seven full-service banking offices in central Florida (in Vero Beach through National Bank of Commerce and in Longwood, Winter Park, Orlando, Oviedo and Kissimmee through United Legacy Bank, a division of National Bank of Commerce).  The company also owns a majority stake in Corporate Billing, LLC, a transaction-based finance company headquartered in Decatur, Alabama that provides factoring, invoicing, collection and accounts receivable management services to transportation companies and automotive parts and service providers nationwide.

NCC files periodic reports with the U.S. Securities and Exchange Commission (the "SEC"). Copies of its filings may be obtained through the SEC's website at www.sec.gov or at www.nationalbankofcommerce.com. More information about NCC and National Bank of Commerce may be obtained at www.nationalbankofcommerce.com.

Forward-Looking Statements

Certain statements contained in this press release that are not statements of historical fact constitute forward-looking statements for which NCC claims the protection of the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995 (the "Act"), notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in NCC's future filings with the SEC, in press releases and in oral and written statements made by NCC or with NCC's approval that are not statements of historical fact and that constitute forward-looking statements within the meaning of the Act. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statements of NCC's plans, objectives and expectations or those of its management or Board of Directors, including those relating to products or services; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as "believes," "anticipates," "expects," "intends," "targeted," "continue," "remain," "will," "should," "may" and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Forward-looking statements are subject to various risks and uncertainties, including those risks and uncertainties described under the heading "Risk Factors" in NCC's Annual Report on Form 10-K for the year ended December 31, 2014 and described in any subsequent reports that NCC has filed with the SEC, which are accessible on the SEC's website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. You should not rely upon forward-looking statements as predictions of future events. NCC undertakes no obligation to update any forward-looking statements or to make any other forward-looking statements, whether as a result of new information, future events or otherwise. In that respect, NCC cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made.

NATIONAL COMMERCE CORPORATION
Unaudited Financial Highlights
(In thousands, except share and per share amounts and percentages)
 
  For the Three Months Ended
  June 30, March 31, December 31, September 30, June 30,
  2015 2015 2014 2014 2014
Earnings Summary          
Interest income  $ 12,714  $ 12,193  $ 10,578  $ 8,107  $ 6,449
Interest expense  1,071  1,027  846  730  634
Net interest income  11,643  11,166  9,732  7,377  5,815
Provision for loan losses   120  161  826  152  --
Gain (loss) on sale of securities   --  --  --  (33)  --
Other noninterest income (1)  2,206  1,764  1,419  1,353  1,326
Merger/conversion related expenses   168  79  246  262  146
Other noninterest expense (2)  9,448  9,211  6,910  5,719  5,289
Income before income taxes  4,113  3,479  3,169  2,564  1,706
Income tax expense   1,264  1,092  1,158  841  568
Net income before minority interest   2,849  2,387  2,011  1,723  1,138
Net income attributable to minority interest   593  466  304  208  --
Net income to common shareholders  $ 2,256  $ 1,921  $ 1,707  $ 1,515  $ 1,138
           
Weighted average common and diluted shares outstanding          
Basic  9,438,541  7,701,663  6,223,377  5,855,276  5,739,173
Diluted  9,569,695  7,801,577  6,305,626  5,929,386  5,793,444
           
Net earnings per common share          
Basic  $ 0.24  $ 0.25  $ 0.27  $ 0.26  $ 0.20
Diluted  $ 0.24  $ 0.25  $ 0.27  $ 0.26  $ 0.20
           
  June 30, March 31, December 31, September 30, June 30,
Selected Performance Ratios 2015 2015 2014 2014 2014
Return on average assets (ROAA) (3)  0.75%  0.67%  0.72%  0.73%  0.61%
Return on average equity (ROAE)  5.22  5.58  6.11  6.17  5.00
Return on average tangible common equity (ROATCE)  6.35  7.15  7.86  6.76  5.00
Net interest margin - taxable equivalent  4.22  4.25  4.58  3.87  3.29
Efficiency ratio  69.43  71.85  64.17  68.51  76.11
Operating efficiency ratio (2)  68.22  71.24  61.97  65.51  74.07
Noninterest income / average assets (annualized)  0.73  0.62  0.60  0.65  0.72
Noninterest expense / average assets (annualized)  3.19  3.24  3.01  2.87  2.94
Yield on loans  5.15  5.26  5.37  4.73  4.17
Cost of total deposits  0.38%  0.38%  0.36%  0.35%  0.34%
           
  June 30, March 31, December 31, September 30, June 30,
Factoring Metrics 2015 2015 2014 2014 2014
Recourse purchased volume  $ 89,009  $ 84,725  $ 107,891  N/A   N/A 
Non-recourse purchased volume  99,614  90,402  90,791  N/A   N/A 
Total purchased volume  $ 188,623  $ 175,127  $ 198,682  N/A   N/A 
Average turn (days)  37.66  41.57  40.08  N/A   N/A 
Net charge-offs / total purchased volume  (0.04)%  0.09%  0.02%  N/A   N/A 
Average discount rate  1.67%  1.65%  1.65%  N/A   N/A 
           
  June 30, March 31, December 31, September 30, June 30,
Mortgage Metrics 2015 2015 2014 2014 2014
Total production ($)  $ 84,796  $ 55,731  $ 55,931  $ 53,542  $ 56,510
Refinance (%)  18.6%  26.9%  22.6%  19.0%  11.8%
Purchases (%)  81.4%  73.1%  77.4%  81.0%  88.2%
           
   
NATIONAL COMMERCE CORPORATION  
Unaudited Financial Highlights  
(In thousands, except share and per share amounts and percentages)  
   
  As of
  June 30, March 31, December 31, September 30, June 30,
Balance Sheet Highlights 2015 2015 2014 2014 2014
Cash and cash equivalents  $ 142,393  $ 149,907  $ 123,435  $ 90,909  $ 105,889
Total securities  42,586  37,631  34,932  34,439  45,986
Mortgage loans held for sale  13,750  13,804  9,329  11,329  11,922
Acquired purchased credit impaired loans  5,724  8,852  9,077  --  --
Acquired non-purchased credit impaired loans  131,953  138,040  143,981  --  --
Nonacquired loans held for investment (4)  757,976  704,307  653,063  623,958  588,065
CBI loans (factoring receivables)   75,000  69,541  82,600  81,926  --
Total gross loans held for investment  970,653  920,740  888,721  705,884  588,065
Allowance for loan losses  9,274  9,522  9,802  9,018  8,974
Total intangibles   31,310  30,560  30,591  23,115  --
Total assets  1,256,614  1,206,667  1,138,426  897,982  783,197
Total deposits  1,051,483  1,000,217  971,060  763,509  666,735
Borrowings  22,000  22,000  22,000  22,000  22,000
Total liabilities   1,081,985  1,034,495  1,002,265  793,931  690,838
Minority interest   7,527  7,166  7,239  7,142  --
Common stock  94  94  75  59  58
Total shareholders' equity  174,629  172,172  136,161  104,051  92,359
Tangible common equity  $ 142,726  $ 141,380  $ 105,265  $ 80,728  $ 92,359
End of period common shares outstanding  9,438,541  9,438,541  7,541,541  5,924,579  5,761,094
           
  As of and For the Three Months Ended
  June 30, March 31, December 31, September 30, June 30,
Asset Quality Analysis 2015 2015 2014 2014 2014
Nonacquired           
Nonaccrual loans  $ 2,688  $ 618  $ 2,276  $ 1,087  $ 1,195
Other real estate and repossessed assets  1,494  1,494  823  830  800
Loans past due 90 days or more and still accruing  44  168  217  176  --
Total nonacquired nonperforming assets   $ 4,226  $ 2,280  $ 3,316  $ 2,093  $ 1,995
           
Acquired          
Nonaccrual loans  $ 2,795  $ 2,576  $ 2,589  $ --  $ --
Other real estate and repossessed assets  142  542  557  --  --
Loans past due 90 days or more and still accruing  --  --  80  --  --
Total acquired nonperforming assets   $ 2,937  $ 3,118  $ 3,226  $ --  $ --
           
Selected asset quality ratios          
Nonperforming assets / Assets  0.57%  0.45%  0.57%  0.23%  0.25%
Nonperforming assets / Loans + OREO + repossessed assets  0.74  0.59  0.74  0.30  0.34
Net charge-offs (recoveries) to average loans (annualized)  0.16  0.20  0.02  0.07  0.13
Allowance for loan losses to total loans  0.96  1.03  1.10  1.28  1.53
Nonacquired nonperforming assets / Nonacquired loans + nonacquired OREO          
+ nonacquired repossessed assets (4)  0.56  0.32  0.51  0.33  0.34
Allowance for loan losses to nonacquired nonperforming loans  339.46  1,211.45  393.18  714.01  750.96
Allowance for loan losses to nonacquired loans (4)  1.13%  1.22%  1.35%  1.42%  1.53%
           
  For the Three Months Ended
  June 30, March 31, December 31, September 30, June 30,
Taxable Equivalent Yields/Rates 2015 2015 2014 2014 2014
Interest income:          
Loans  5.15%  5.26%  5.37%  4.73%  4.17%
Mortgage loans held for sale  4.02  3.63  4.32  4.26  4.00
Interest on securities:          
Taxable  3.33  2.92  3.17  3.04  2.67
Non-taxable  5.08  5.72  5.73  5.97  5.89
Cash balances in other banks  0.38  0.36  0.26  0.26  0.23
Total interest earning assets  4.60  4.64  4.97  4.25  3.65
           
Interest expense:          
Interest on deposits  0.50  0.49  0.46  0.44  0.43
Interest on FHLB & other borrowings  2.01  2.01  2.02  2.00  2.01
Total interest bearing liabilities  0.54  0.53  0.52  0.50  0.50
Net interest spread  4.06  4.11  4.45  3.75  3.15
Net interest margin  4.22%  4.25%  4.58%  3.87%  3.29%
           
   
NATIONAL COMMERCE CORPORATION  
Unaudited Financial Highlights  
(In thousands, except share and per share amounts and percentages)  
   
  As of
  June 30, March 31, December 31, September 30, June 30,
  2015 2015 2014 2014 2014
Shareholders' Equity and Capital Ratios          
Tier 1 Leverage Ratio  11.09%  11.41%  10.68%  9.87%  11.97%
Tier 1 Common Capital Ratio  12.86  13.54  10.66  11.12  14.81
Tier 1 Risk -based Capital Ratio  12.86  13.54  10.66  11.12  14.81
Total Risk Based Capital Ratio  13.78  14.55  11.75  12.37  16.06
Equity / Assets  13.90  14.27  11.96  11.59  11.79
Tangible common equity to tangible assets  11.65%  12.02%  9.50%  9.23%  11.79%
Book value per share  $ 18.50  $ 18.24  $ 18.05  $ 17.56  $ 16.03
Tangible book value per share  $ 15.12  $ 14.98  $ 13.96  $ 13.63  $ 16.03
           
  For the Three Months Ended
  June 30, March 31, December 31, September 30, June 30,
  2015 2015 2014 2014 2014
Detail of other noninterest expense          
Salaries and employee benefits  $ 5,114  $ 4,987  $ 3,717  $ 3,547  $ 3,119
Commission-based compensation  1,056  796  900  459  471
Occupancy and equipment expense  829  836  572  477  459
Data processing expenses  487  425  291  295  294
Advertising and marketing expenses  125  173  126  79  63
Legal fees  239  167  389  326  134
FDIC insurance assessments  152  206  151  131  105
Accounting and audit expenses  225  223  208  102  103
Consulting and other professional expenses  183  105  150  89  73
Telecommunications expenses  135  128  79  67  67
ORE, Repo asset and other collection expenses  71  122  102  32  20
Core deposit intangible amortization  111  111  18  --  --
Other noninterest expense  889  1,011  453  377  527
Total noninterest expense  $ 9,616  $ 9,290  $ 7,156  $ 5,981  $ 5,435
           
   
NATIONAL COMMERCE CORPORATION  
Unaudited Financial Highlights  
(In thousands, except share and per share amounts and percentages)  
   
  As of
  June 30, March 31, December 31, September 30, June 30,
Non-GAAP Reconciliation 2015 2015 2014 2014 2014
Total shareholders' equity  $ 174,629  $ 172,172  $ 136,161  $ 104,051  $ 92,359
Less: Intangible assets  31,310  30,560  30,591  23,115  --
Less: minority interest not included in intangible assets  593  232  305  208  --
Tangible common equity  $ 142,726  $ 141,380  $ 105,265  $ 80,728  $ 92,359
Common shares outstanding at year or period end   9,438,541  9,438,541  7,541,541  5,924,579  5,761,094
Tangible book value per share  $ 15.12  $ 14.98  $ 13.96  $ 13.63  $ 16.03
Total assets at end of period  $ 1,256,614  $ 1,206,667  $ 1,138,426  $ 897,982  $ 783,197
Less: Intangible assets  31,310  30,560  30,591  23,115  --
Adjusted total assets at end of period  $ 1,225,304  $ 1,176,107  $ 1,107,835  $ 874,867  $ 783,197
Tangible common equity to tangible assets  11.65%  12.02%  9.50%  9.23%  11.79%
Total allowance for loan losses  $ 9,274  $ 9,522  $ 9,802  $ 9,018  $ 8,974
Less: allowance for loan losses attributable to CBI (factoring receivables)  715  956  955  175  --
Adjusted allowance for loan losses at end of period  $ 8,559  $ 8,566  $ 8,847  $ 8,843  $ 8,974
Nonacquired loans held for investment (4)  757,976  704,307  653,063  623,958  588,065
Allowance for loan losses to nonacquired loans (4)  1.13%  1.22%  1.35%  1.42%  1.53%
           
  For the Three Months Ended
  June 30, March 31, December 31, September 30, June 30,
  2015 2015 2014 2014 2014
Non-GAAP Reconciliation          
Total average shareholders' equity  $ 173,354  $ 139,618  $ 110,855  $ 97,344  $ 91,325
Less: Average intangible assets  30,555  30,553  24,417  8,291  --
Less: average minority interest not included in intangible assets  315  46  277  188  -- 
Average tangible common equity  $ 142,484  $ 109,019  $ 86,161  $ 88,865  $ 91,325
Net income to common shareholders  2,256  1,921  1,707  1,515  1,138
Return on average tangible common equity (ROATCE)  6.35%  7.15%  7.86%  6.76%  5.00%
Efficiency ratio:          
Net interest income  $ 11,643  $ 11,166  $ 9,732  $ 7,377  $ 5,815
Total noninterest income  2,206  1,764  1,419  1,320  1,326
Less: gain (loss) on sale of securities   --  --  --  (33)  --
Operating revenue  $ 13,849  $ 12,930  $ 11,151  $ 8,730  $ 7,141
Expenses:          
Total noninterest expenses  $ 9,616  $ 9,290  $ 7,156  $ 5,981  $ 5,435
Efficiency ratio  69.43%  71.85%  64.17%  68.51%  76.11%
Operating efficiency ratio:          
Net interest income  $ 11,643  $ 11,166  $ 9,732  $ 7,377  $ 5,815
Total noninterest income  2,206  1,764  1,419  1,320  1,326
Less: gain (loss) on sale of securities   --  --  --  (33)  --
Operating revenue  $ 13,849  $ 12,930  $ 11,151  $ 8,730  $ 7,141
Expenses:          
Total noninterest expenses  $ 9,616  $ 9,290  $ 7,156  $ 5,981  $ 5,435
Less: merger/conversion expenses  168  79  246  262  146
Adjusted noninterest expenses  $ 9,448  $ 9,211  $ 6,910  $ 5,719  $ 5,289
Operating efficiency ratio  68.22%  71.24%  61.97%  65.51%  74.07%
           
(1) Excludes securities gains
(2) Excludes merger and conversion related expenses
(3) Net income to common shareholders / average assets
(4) Excludes CBI loans
 
     
NATIONAL COMMERCE CORPORATION
Unaudited Consolidated Balance Sheets
(In thousands, except share and per share data)
 
Assets
  June 30, 2015 December 31, 2014
Cash and due from banks   $ 17,677  $ 14,236
Interest-bearing deposits with banks   124,716  109,199
Cash and cash equivalents   142,393  123,435
Investment securities held-to-maturity (fair value of $12,122 at June 30, 2015)   12,609  --
Investment securities available-for-sale   29,977  34,932
Other investments   5,844  5,421
Mortgage loans held-for-sale   13,750  9,329
Loans, net of unearned income   970,653  888,721
Less: allowance for loan losses   9,274  9,802
Loans, net   961,379  878,919
Premises and equipment, net   27,554  27,560
Accrued interest receivable   2,217  2,193
Bank owned life insurance   11,848  10,641
Other real estate   1,494  1,008
Deferred tax assets, net   12,149  11,444
Goodwill   29,775  28,834
Core deposit intangible, net   1,535  1,757
Other assets   4,090  2,953
Total assets   $ 1,256,614  $ 1,138,426
     
Liabilities and Shareholders' Equity
Deposits:     
Noninterest-bearing demand   $ 246,804  $ 217,643
Interest-bearing demand   162,087  154,816
Savings and money market   414,720  392,394
Time   227,872  206,207
Total deposits   1,051,483  971,060
Federal Home Loan Bank advances   22,000  22,000
Accrued interest payable   453  431
Other liabilities   8,049  8,774
Total liabilities   1,081,985  1,002,265
Commitments     
Shareholders' equity:     
Preferred stock, 250,000 shares authorized, no shares issued or outstanding   --  --
Common stock, at June 30, 2015, $0.01 par value, 30,000,000 shares authorized and    
9,438,541 shares issued and outstanding; at December 31, 2014, $0.01 par value,    
12,500,000 shares authorized and 7,541,541 shares issued and outstanding   94  75
Additional paid-in capital   165,674  131,455
Retained earnings (deficit)   724  (3,453)
Accumulated other comprehensive income   610  845
Total shareholders' equity attributable to National Commerce Corporation   167,102  128,922
Noncontrolling interest   7,527  7,239
Total shareholders' equity   174,629  136,161
Total liabilities and shareholders' equity   $ 1,256,614  $ 1,138,426
 
NATIONAL COMMERCE CORPORATION
Unaudited Consolidated Statements of Earnings
(In thousands, except per share data)
 
  For the Three Months Ended For the Six Months Ended
  June 30, June 30,
  2015 2014 2015 2014
Interest and dividend income:        
Interest and fees on loans  $ 12,226  $ 6,053  $ 24,018  $ 11,839
Interest and dividends on taxable investment securities  269  310  525  627
Interest on non-taxable investment securities  114  42  156  84
Interest on interest-bearing deposits and federal funds sold  105  44  208  107
Total interest income  12,714  6,449  24,907  12,657
Interest expense:        
Interest on deposits  961  524  1,879  1,074
Interest on borrowings  110  110  219  219
Total interest expense  1,071  634  2,098  1,293
Net interest income  11,643  5,815  22,809  11,364
Provision for loan losses  120  --  281  --
Net interest income after provision for loan losses  11,523  5,815  22,528  11,364
Other income:        
Service charges and fees on deposit accounts  308  172  575  338
Mortgage origination and fee income  1,505  1,048  2,776  1,753
Merchant sponsorship revenue  191  --  191  --
Income from bank owned life insurance  86  60  165  120
Wealth management fees  13  15  32  29
(Loss) gain on other real estate  (11)  --  (24)  5
(Loss) gain on sale of investment securities available-for-sale  --  --  --  --
Other  114  31  255  48
Total other income  2,206  1,326  3,970  2,293
Other expense:        
Salaries and employee benefits  5,114  3,119  10,101  6,115
Commission-based compensation  1,056  471  1,852  777
Occupancy and equipment  829  459  1,665  895
Core deposit intangible amortization  111  --  222  --
Other operating expense  2,506  1,386  5,066  2,529
Total other expense  9,616  5,435  18,906  10,316
Earnings before income taxes  4,113  1,706  7,592  3,341
Income tax expense  1,264  568  2,356  1,160
Net earnings   2,849  1,138  5,236  2,181
Less: Net earnings attributable to noncontrolling interest  593  --  1,059  --
Net earnings attributable to National Commerce Corporation  $ 2,256  $ 1,138  $ 4,177  $ 2,181
         
Basic earnings per common share  $ 0.24  $ 0.20  $ 0.49  $ 0.38
Diluted earnings per common share  $ 0.24  $ 0.20  $ 0.48  $ 0.38
 
NATIONAL COMMERCE CORPORATION
Average Balance Sheets and Net Interest Analysis
                               
  For the Three Months Ended
(Dollars in thousands)
June 30, 2015

March 31, 2015

December 31, 2014

September 30, 2014

June 30, 2014
Interest earning assets
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Loans  $ 944,373  $ 12,116 5.15%  $ 903,563  $ 11,709 5.26%  $ 748,373  $ 10,124 5.37%  $ 640,806  $ 7,636 4.73%  $ 570,896  $ 5,935 4.17%
Mortgage loans held for sale  11,180  112  4.02   9,487  85  3.63   9,914  108  4.32   10,348  111  4.26   12,145  121  4.00 
Securities:                              
Taxable securities  32,402  269  3.33   35,540  256  2.92   34,366  275  3.17   36,011  276  3.04   46,525  310  2.67 
Tax-exempt securities  14,297  181  5.08   4,750  67  5.72   4,640  67  5.73   4,584  69  5.97   4,496  66  5.89 
Cash balances in other banks  112,081  105  0.38   114,579  103  0.36   48,646  32  0.26   67,191  44  0.26   77,607  44  0.23 
Total interest earning assets  1,114,333  $ 12,783  4.60   1,067,919  $ 12,220  4.64   845,939  $ 10,606  4.97   758,940  $ 8,136  4.25   711,669  $ 6,476  3.65 
Non-interest earning assets  95,949      94,118      96,203      68,521      31,040    
Total assets  $ 1,210,282      $ 1,162,037      $ 942,142      $ 827,461      $ 742,709    
                               
Interest bearing liabilities                              
Interest bearing transactions accounts  $ 157,261  $ 97 0.25%  $ 159,706  $ 99 0.25%  $ 135,882  $ 96 0.28%  $ 125,356  $ 89 0.28%  $ 112,371  $ 73 0.26%
Savings & money market deposits  408,117  417  0.41   391,321  377  0.39   330,459  309  0.37   308,942  295  0.38   276,062  253  0.37 
Time deposits  208,388  447  0.86   209,016  442  0.86   161,368  329  0.81   118,023  235  0.79   97,303  198  0.82 
Federal Home Loan Bank & other borrowed money  22,000  110  2.01   22,000  109  2.01   22,027  112  2.02   22,000  111  2.00   22,000  110  2.01 
Total interest-bearing liabilities  795,766  $ 1,071  0.54   782,043  $ 1,027  0.53   649,736  $ 846  0.52   574,321  $ 730  0.50   507,736  $ 634  0.50 
Non-interest bearing deposits  233,136      232,497      172,290      150,566      141,623    
Total funding sources  1,028,902      1,014,540      822,026      724,887      649,359    
Non-interest bearing liabilities  8,026      7,879      9,261      5,230      2,025    
Shareholders' equity  173,354      139,618      110,855      97,344      91,325    
   $ 1,210,282      $ 1,162,037      $ 942,142      $ 827,461      $ 742,709    
Net interest rate spread     4.06%     4.11%     4.45%     3.75%     3.15%
Net interest income/margin (Taxable equivalent)    11,712 4.22%    11,193 4.25%    9,760 4.58%    7,406 3.87%    5,842 3.29%
Tax equivalent adjustment    69      27      28      29      27  
Net interest income/margin    $ 11,643 4.19%    $ 11,166 4.24%    $ 9,732 4.56%    $ 7,377 3.86%    $ 5,815 3.28%
CONTACT: National Commerce Corporation
         
         Will Matthews
         Vice Chairman and Chief Financial Officer
         (205) 313-8122

National Commerce Corporation logo

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