Mountain Commerce Bancorp, Inc. Announces First Quarter 2021 Results And 4% Increase in Quarterly Cash Dividend

Rhea-AI Summary

Mountain Commerce Bancorp (MCBI) reported a strong Q1 2021, with net income of $4.86 million, a 13% increase year-over-year. Diluted EPS rose to $0.77, reflecting a 7% gain. The Board declared a quarterly cash dividend of $0.13, marking a 4% rise from the previous quarter, payable on June 1, 2021. Net interest income surged 30.2% to $10 million, driven by a 21.3% increase in average interest-earning assets. Despite a slight rise in non-performing assets to 0.27%, the allowance for loan losses remains robust at 774.46% of non-performing loans.

Positive

• Net income increased by 13% year-over-year to $4.86 million.
• Diluted EPS rose to $0.77, a 7% increase from the previous year.
• Quarterly dividend increased 4% to $0.13 per share.
• Net interest income surged 30.2% to $10 million.
• Non-performing loans to total loans decreased slightly to 0.18%.
• Allowance for loan losses remains strong at 774.46% of non-performing loans.
• Total assets increased by 3.3% to $1.146 billion.

Negative

• Non-interest income fell by 22.2% to $0.6 million.
• Non-performing assets rose from 0.16% to 0.27% of total assets.

KNOXVILLE, Tenn., April 26, 2021 /PRNewswire/ -- Mountain Commerce Bancorp, Inc. (the "Company") (OTCQX: MCBI), the holding company for Mountain Commerce Bank (the "Bank"), today announced earnings and related data as of and for the three months ended March 31, 2021.

The Company also announced today that its Board of Directors declared a quarterly cash dividend of $0.13 per common share, representing a 4% increase from the $0.125 cash dividend declared in the prior quarter.  The dividend is payable on June 1, 2021 to shareholders of record as of the close of business on May 12, 2021.

Highlights

The following tables highlight the trends that the Company believes are most relevant to understanding the performance of the Company as of and for the three months ended March 31, 2021.  As further detailed in Appendix A to this press release, adjusted results (which are non-GAAP financial measures) reflect adjustments for realized investment gains and losses, the impact of PPP fee accretion (net of the amortization of PPP deferred loan costs and one-time PPP bonuses), gains and losses from the sale of REO, the provision for loan losses, and the provision for unfunded loan commitments.  See Appendix B to this press release for more information on our tax equivalent net interest margin.  All financial information in this press release is unaudited.

		For the Three Months Ended March 31,
		(Dollars in thousands, except per share data)
		2021					2020
		GAAP		Adjusted (1)			GAAP		Adjusted (1)
Net income	$	4,860		4,313		$	2,286		3,390
Diluted earnings per share	$	0.77		0.69		$	0.36		0.54
Return on average assets (ROAA)		1.73%		1.53%			0.98%		1.45%
Return on average equity		18.36%		16.30%			9.84%		14.60%
Efficiency ratio		39.87%		42.85%			45.98%		45.98%
Net interest margin (tax equivalent)		3.82%		3.48%			3.46%		3.46%
Pre-tax, pre-provision earnings (1)	$	6,397				$	4,585
Pre-tax, pre-provision ROAA (1)		2.27%					1.97%

(1) Represents a non-GAAP financial measure.  See Appendix A to this press release for more information.

			As of or			As of or
			Period Ended			Period Ended
			March 31,			December 31,
			2021			2020
			(Dollars in thousands, except share data)
Asset Quality
	Non-performing loans	$	1,699		$	1,801
	Real estate owned	$	1,378		$	-
	Non-performing assets	$	3,077		$	1,801
	Non-performing loans to total loans		0.18%			0.19%
	Non-performing assets to total assets		0.27%			0.16%
	Loans with COVID-19 related modifications (1)	$	6,797		$	-
	Net charge-offs	$	155		$	20
	Allowance for loan losses to non-performing loans		774.46%			739.20%
	Allowance for loan losses to total loans		1.38%			1.42%
	Allowance for loan losses to non-PPP loans (2)		1.53%			1.56%
Other Data
	Core deposits	$	681,402		$	620,576
	Cash dividends declared	$	0.125		$	-
	Shares outstanding		6,291,003			6,286,003
	Book and tangible book value per share (3)	$	17.06		$	16.52
	Closing market price per common share	$	23.80		$	20.50
	Closing price to book value ratio		139.51%			124.10%
	Equity to assets ratio		9.36%			9.36%
	Bank regulatory leverage ratio		10.43%			10.11%

	(1)	Including both principal deferrals and interest only terms
	(2)	As further detailed in Appendix A to this press release, allowance for loan losses to non-PPP loans is a non-GAAP financial measure
	(3)	The Company does not have any intangible assets

Management Commentary

William E. "Bill" Edwards, III, President and Chief Executive Officer of the Company, commented, "We are pleased to start out 2021 with another successful quarter which saw adjusted net income (non-GAAP) increase 27% from $3.4 million in the first quarter of 2020 to $4.3 million in the same quarter of 2021, while adjusted earnings per diluted share (non-GAAP) increased 28% from $0.54 to $0.69 over the same period.  I am proud to say that we have continued to support our clients and communities by actively participating in the second round of PPP, where we have loaned nearly $37 million and earned $1.7 million in fees as of March 31, 2021. Our allowance to non-PPP loans (non-GAAP) currently stands at 1.53%, and I am happy to report that our COVID-related modifications consist of only one $6.8 million hotel relationship as of March 31, 2021.  Based on this and continued strong asset quality and positive signs in the economies in our markets, we did not provide any additional allowance for loan losses in the first quarter of 2021.  We continue to remain highly focused on delivering strong returns to our shareholders, which we believe is reflected in our adjusted return on average equity (non-GAAP) increasing from 14.60% in the first quarter of 2020 to 16.30% in the same period of 2021, a year-over-year increase of 11.6%.  From an asset quality perspective, our non-performing assets to total assets remain low at 0.27% at March 31, 2021, up slightly from 0.16% at December 31, 2020.  Finally, in order to provide an additional source of liquidity and increased returns for our shareholders, we announced a $5 million share repurchase authorization on April 12, 2021, and increased our quarterly dividend by 4% to $0.13 per quarter."

Net Interest Income

Net interest income increased $2.3 million, or 30.2%, from $7.7 million for the three months ended March 31, 2020 to $10.0 million for the same period in 2021.  The increase between the periods was primarily the result of the following factors:

• Average interest-earning assets grew $190.8 million, or 21.3%, from $896.1 million to $1.087 billion, due in part to PPP loans.
• Average net interest-earning assets grew $106.1 million, or 54.9%, from $193.2 million to $299.3 million, funded by increases in noninterest bearing deposits and an increase in shareholders' equity.
• The average rate paid on interest-bearing liabilities dropped 61.2% from 1.65% to 0.64%, driving an increase in tax-equivalent net interest margin from 3.46% to 3.82%.

The Company recognized approximately $0.7 million and $0 of PPP loan origination fees, net of the amortization of deferred PPP loan costs, through net interest income during the three months ended March 31, 2021 and 2020, respectively.

Provision For Loan Losses

No provision for loan losses was recorded during the three months ended March 31, 2021 as the result of a minimal level of COVID-related loan modifications, continued strong asset quality, and continued strengthening of the economy in our primary markets.  A provision for loan losses of $1.5 million was recorded for the three months ended March 31, 2020 as a result of the Company increasing the qualitative factors in its allowance for loan loss model and increasing reserve factors on certain loans to borrowers we viewed then as more likely to be impacted by the COVID-19 pandemic. 

Noninterest Income

Noninterest income decreased $0.2 million, or 22.2%, from $0.8 million in the first quarter of 2020 to $0.6 million in the same quarter of 2021, due primarily to a $0.2 million decline in swap brokerage fees, which was partially offset by an increase in gain on sale of loans and wealth management fees.

Noninterest Expense

Noninterest expense increased $0.3 million, or 8.7%, from $3.9 million in the first quarter of 2020 to $4.2 million in the same period of 2021.  The increase was primarily the result of a $0.1 million increase in FDIC insurance due to the expiration of certain credits, and a $0.1 million increase in Other noninterest expense due to an increase in the reserve for unfunded loan commitments.

Income Taxes

The effective tax rate of the Company was 24.0% and 26.0% for the three months ended March 31, 2021 and 2020, respectively.  The Company's marginal tax rate of 26.14% is favorably impacted by certain sources of non-taxable income including bank-owned life insurance (BOLI), tax-free loans and investments in tax-free municipal securities.  The Company's effective tax rate declined during the three months ended March 31, 2021 compared to the same period in 2020 due primarily to increased investments in tax-free municipal securities and investments in certain loans eligible for a 5% state tax credit.

Balance Sheet

Total assets increased $36.2 million, or 3.3%, from $1.110 billion at December 31, 2020 to $1.146 billion at March 31, 2021.  The increase was primarily driven by the following factors:

• Investments available for sale increased $13.9 million, or 18.0%, from $77.3 million at December 31, 2020 to $91.2 million at March 31, 2021 as the Company took advantage of a steepening yield curve to invest excess liquidity.
• Loans receivable increased $21.2 million, or 2.3%, from $935.5 million at December 31, 2020 to $956.7 million at March 31, 2021.  Substantially all of this increase resulted from $36.8 million of additional PPP loans originated during the first quarter of 2021 as well as a $16.3 million increase in residential loans.

The following summarizes changes in loan balances over the last five quarters:

		March 31,		December 31,		September 30,		June 30,		March 31,
		2021		2020		2020		2020		2020
(in thousands)
Residential construction	$	13,037		14,805		17,772		17,238		20,950
Other construction		33,720		35,361		39,858		40,996		40,944
Farmland		6,322		7,943		8,430		8,592		8,391
Home equity		32,281		32,543		35,833		35,882		41,674
Residential		240,606		224,288		218,872		211,234		203,030
Multi-family		45,703		42,666		27,758		26,606		26,980
Owner-occupied commercial		168,442		170,683		150,402		149,646		137,289
Non-owner occupied commercial		233,142		234,751		257,907		253,280		256,197
Commercial & industrial		76,421		80,380		73,234		74,107		78,031
PPP Program		96,147		81,465		107,723		107,384		-
Consumer		10,891		10,597		10,359		11,375		11,098
	$	956,712		935,482		948,148		936,340		824,584

Total deposits increased $33.5 million, or 3.6%, from $921.9 million at December 31, 2020 to $955.4 million at March 31, 2021.  The primary driver of this increase was a $41.8 million, or 20.1%, increase in noninterest-bearing deposit balances from $208.3 million to $250.1 million.  

The following summarizes changes in deposit balances over the last five quarters:

		March 31,		December 31,		September 30,		June 30,		March 31,
		2021		2020		2020		2020		2020
(in thousands)
Non-interest bearing transaction	$	250,069		208,250		221,300		215,202		134,498
NOW and money market		105,641		96,243		86,931		84,930		83,658
Savings		325,692		316,083		306,119		286,995		283,032
Retail time deposits		138,989		173,305		196,188		186,386		175,857
Wholesale time deposits		134,994		128,015		88,831		126,486		152,670
	$	955,385		921,896		899,369		899,999		829,715

FHLB borrowings of $50.0 million at March 31, 2021 represent a 3-month floating rate advance swapped to a fixed rate through March 2025. 

Total equity increased $3.5 million, or 3.4%, from $103.8 million at December 31, 2020 to $107.3 million at March 31, 2021.  This increase was primarily comprised of net income of $4.9 million and an improvement in the value of the interest rate swap of $0.6 million, offset by a decline in the net unrealized gains on investments available for sale of $1.3 million and dividends paid of $0.8 million.  Tangible book value per share improved from $16.52 at December 31, 2020 to $17.06 at March 31, 2021, an annualized increase of 13.1%.  Equity to assets was 9.36% at both March 31, 2021 and December 31, 2020.  The Company and Bank both remain well capitalized.

Asset Quality

Non-performing loans to total loans decreased slightly from 0.19% at December 31, 2020 to 0.18% at March 31, 2021.  Non-performing assets to total assets increased from 0.16% at December 31, 2020 to 0.27% at March 31, 2021, due to the foreclosure of a single agricultural property during the first quarter of 2021 in the amount of $1.4 million.  This property has a 90% government guarantee and no material loss is expected.  Net charge-offs of $155 thousand were recognized during the first quarter of 2021 compared to $20 thousand during the full year ended December 31, 2020.  The allowance for loan losses to total loans decreased slightly from 1.42% (1.56% excluding PPP loans) at December 31, 2020 to 1.38% (1.53% excluding PPP loans) at March 31, 2021, and coverage of non-performing loans by the allowance remained strong at 774.5% at March 31, 2021. 

During the first quarter of 2021, the Company granted a modification on a $6.8 million loan in the hotel industry that experienced COVID-related construction delays.  As of March 31, 2021, this is the only COVID-related loan modification outstanding. Pursuant to interagency guidance, the Company has elected to not consider loans modified under the CARES Act as troubled debt restructurings.

The following summarizes the outstanding loans as of the applicable period with COVID-related modifications by customer industry:

		March 31,		December 31,		September 30,		June 30,
		2021		2020		2020		2020
(in thousands)
Office building	$	-		-		10,345		19,800
Warehouse		-		-		9,691		13,400
Residential 1-4		-		-		3,985		13,800
Retail		-		-		3,138		7,900
Vacant real estate		-		-		2,513		2,767
Medical		-		-		1,719		2,856
Campground		-		-		1,564		1,564
Equipment		-		-		1,100		1,982
Vacation cabins		-		-		1,069		9,100
Restaurants		-		-		1,029		1,964
Hotel		6,797		-		917		67,000
Mini-storage		-		-		-		21,800
Marina		-		-		-		9,300
Multi-family		-		-		-		5,900
Other industries		-		-		2,988		12,367
	$	6,797		-		40,058		191,500

Non-GAAP Financial Measures

Statements included in this press release include non-GAAP financial measures and should be read along with the accompanying tables in Appendix A, which provide a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures.  This press release and the accompanying tables discuss financial measures such as adjusted net income, adjusted diluted earnings per share, adjusted return on average assets, adjusted return on average equity, adjusted net interest margin (tax equivalent), and adjusted efficiency ratio, which are all non-GAAP financial measures. We also present in this press release and the accompanying tables pre-tax, pre-provision earnings, pre-tax, pre-provision return on average assets, and the allowance for loan losses to loans excluding PPP loans which are also non-GAAP financial measures. We believe that such non-GAAP financial measures are useful because they enhance the ability of investors and management to evaluate and compare the Company's operating results from period to period in a meaningful manner.  Non-GAAP financial measures should not be considered as an alternative to any measure of performance calculated pursuant to GAAP, nor are they necessarily comparable to non-GAAP financial measures that may be presented by other companies.  Investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company.  Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP.

Forward-Looking Statements

This press release contains forward-looking statements. The words "expect," "intend," "should," "may," "could," "believe," "suspect," "anticipate," "seek," "plan," "estimate" and similar expressions are intended to identify such forward-looking statements, but other statements not based on historical fact may also be considered forward-looking. Such forward-looking statements involve known and unknown risks and uncertainties that include, without limitation, (i) further deterioration in the financial condition of our borrowers resulting in significant increases in loan losses and provisions for those losses, (ii) the further effects of the emergence of widespread health emergencies or pandemics, including the magnitude and duration of the COVID-19 pandemic and its impact on general economic and financial market conditions and on our and our customers' business, results of operations, asset quality and financial condition; (iii) deterioration in the real estate market conditions in our market areas, (iv) the impact of increased competition with other financial institutions, including pricing pressures, and the resulting impact on our results, including as a result of compression to our net interest margin, (v) the deterioration of the economy in our market areas, (vi) fluctuations or differences in interest rates on loans or deposits from those that we are modeling or anticipating, including as a result of our inability to better match deposit rates with the changes in the short-term rate environment, or that affect the yield curve, (vii) the ability to grow and retain low-cost core deposits, (viii) significant downturns in the business of one or more large customers, (ix) effectiveness of our asset management activities in improving, resolving or liquidating lower quality assets, (x) our inability to maintain the historical, long-term growth rate of our loan portfolio, (xi) risks of expansion into new geographic or product markets, (xii) the possibility of increased compliance and operational costs as a result of increased regulatory oversight, (xiii) our inability to comply with regulatory capital requirements, including those resulting from changes to capital calculation methodologies and required capital maintenance levels, (xiv) changes in state or Federal regulations, policies, or legislation applicable to banks and other financial service providers, including regulatory or legislative developments arising out of current unsettled conditions in the economy, (xv) changes in capital levels and loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments, (xvi) inadequate allowance for loan losses, (xvii) results of regulatory examinations, (xviii) the vulnerability of our network and online banking portals, and the systems of parties with whom we contract, to unauthorized access, computer viruses, phishing schemes, spam attacks, human error, natural disasters, power loss and other security breaches, (xix) the possibility of increased corporate or personal tax rates and the resulting reduction in our and our customers' businesses as a result of any such increases, (xx) approval of the declaration of any dividend by our Board of Directors, (xxi) loss of key personnel, (xxii) adverse results (including costs, fines, reputational harm and/or other negative effects) from current or future obligatory litigation, examinations or other legal and/or regulatory actions, and (xxiii) the negative impact of possible future inflationary pressures.  These risks and uncertainties may cause our actual results or performance to be materially different from any future results or performance expressed or implied by such forward-looking statements. Our future operating results depend on a number of factors which were derived utilizing numerous assumptions that could cause actual results to differ materially from those projected in forward-looking statements.

About Mountain Commerce Bancorp, Inc. and Mountain Commerce Bank

Mountain Commerce Bancorp, Inc. is the holding company for Mountain Commerce Bank.  The Company's shares of common stock trade on the OTCQX under the symbol "MCBI".

Mountain Commerce Bank is a state-chartered financial institution headquartered in Knoxville, TN. The Bank traces its history back over a century and serves East Tennessee through 5 branches located in Erwin, Johnson City, Knoxville and Unicoi.  The Bank focuses on relationship banking of small and medium-sized businesses and high net worth individuals who value the personal service and attention that only a community bank can offer.  For further information, please visit us at www.mcb.com

Mountain Commerce Bancorp, Inc. and Subsidiary
Condensed Consolidated Statements of Income
(Amounts in thousands, except share data)
			Three Months Ended
			March 31,
			2021	2020
Interest income
	Loans	$	10,664	10,198
	Investment securities - taxable		470	265
	Investment securities - tax exempt		96	3
	Dividends and other		52	117
			11,282	10,583
Interest expense
Deposits
	Savings		251	1,014
	Interest bearing transaction accounts		69	227
	Time certificates of deposit of $250,000 or more		293	629
	Other time deposits		241	732
	Total deposits		854	2,602
	Senior debt		113	153
	Subordinated debt		163	-
	FHLB & FRB advances		122	122
			1,252	2,877
Net interest income			10,030	7,706
Provision for loan losses			-	1,495
Net interest income after provision for loan losses			10,030	6,211
Noninterest income
	Service charges and fee income		294	297
	Bank owned life insurance		31	35
	Realized gain on sale of investment securities available for sale		1	-
	Unrealized gains on equity securities		1	-
	Gain on sale of loans		102	64
	Wealth management		164	116
	Swap fees		-	245
	Other noninterest income		15	25
			608	782
Noninterest expense
	Compensation and employee benefits		2,320	2,379
	Occupancy		359	338
	Furniture and equipment		148	89
	Data processing		395	337
	FDIC insurance		115	42
	Office		163	128
	Advertising		42	46
	Professional fees		218	256
	Real estate owned		30	(16)
	Other noninterest expense		451	304
			4,241	3,903
Income before income taxes			6,397	3,090
Income taxes			1,537	804
Net income		$	4,860	2,286
Undistributed earnings allocated to unvested shares			15	6
Net income available to common shareholders		$	4,845	2,280
Earnings per common share:
	Basic	$	0.77	0.36
	Diluted	$	0.77	0.36
Weighted average common shares outstanding:
	Basic		6,268,706	6,271,810
	Diluted		6,271,531	6,294,540

Mountain Commerce Bancorp, Inc. and Subsidiary
Condensed Consolidated Balance Sheets
(Amounts in thousands)
			March 31,			December 31,
			2021			2020
Assets
Cash and due from banks		$	11,768		$	14,287
Interest-earning deposits in other banks			57,750			58,081
	Cash and cash equivalents		69,518			72,368
Investments available for sale			91,165			77,290
Equity securities			3,630			3,630
Loans held for sale			1,107			418
Loans receivable			956,712			935,482
Allowance for loans losses			(13,158)			(13,313)
	Net loans receivable		943,554			922,169
Premises and equipment, net			11,382			11,438
Accrued interest receivable			3,654			4,247
Real estate owned			1,378			-
Bank owned life insurance			9,465			7,435
Restricted stock			3,701			2,951
Deferred tax assets, net			3,478			3,611
Other assets			4,167			4,413
Total assets		$	1,146,199		$	1,109,970
Liabilities and Shareholders' Equity
Noninterest-bearing		$	250,069		$	208,250
Interest-bearing			570,322			585,631
Wholesale			134,994			128,015
	Total deposits		955,385			921,896
FHLB / FRB borrowings			50,000			50,000
Senior debt, net			13,495			13,994
Subordinated debt, net			9,790			9,778
Accrued interest payable			292			495
Post-employment liabilities			3,065			2,992
Other liabilities			6,850			6,974
Total liabilities			1,038,877			1,006,129
Total shareholders' equity			107,322			103,841
Total liabilities and shareholders' equity		$	1,146,199		$	1,109,970

Appendix A - Reconciliation of Non-GAAP Financial Measures
		Three Months Ended
		March 31
		(Dollars in thousands, except per share data)
		2021	2020
Adjusted Net Income
Net income (GAAP)	$	4,860	2,286
Realized gain on sale of investment securities		(1)	-
Unrealized gains on equity securities		(1)	-
Accretion of PPP fees, net		(874)	-
(Gain) loss from sale of REO		-	-
Provision for loan losses		-	1,495
Provision for unfunded loan commitments		135	-
Tax effect of adjustments		193	(391)
Adjusted net income (Non-GAAP)	$	4,313	3,390
Adjusted Diluted Earnings Per Share
Diluted earnings per share (GAAP)	$	0.77	0.36
Realized gain on sale of investment securities		(0.00)	-
Unrealized gains on equity securities		(0.00)	-
Accretion of PPP fees, net		(0.14)	-
(Gain) loss from sale of REO		-	-
Provision for loan losses		-	0.24
Provision for unfunded loan commitments		0.02	-
Tax effect of adjustments		0.03	(0.06)
Adjusted net income (Non-GAAP)		0.69	0.54
Adjusted Return on Average Assets
Return on average assets (GAAP)		1.73%	0.98%
Realized gain on sale of investment securities		0.00%	0.00%
Unrealized gains on equity securities		0.00%	0.00%
Accretion of PPP fees, net		-0.31%	0.00%
(Gain) loss from sale of REO		0.00%	0.00%
Provision for loan losses		0.00%	0.53%
Provision for unfunded loan commitments		0.05%	0.00%
Tax effect of adjustments		0.07%	-0.14%
Adjusted return on average assets (Non-GAAP)		1.53%	1.45%
Adjusted Return on Average Equity
Return on average equity (GAAP)		18.36%	9.84%
Realized gain on sale of investment securities		0.00%	0.00%
Unrealized gains on equity securities		0.00%	0.00%
Accretion of PPP fees, net		-3.30%	0.00%
(Gain) loss from sale of REO		0.00%	0.00%
Provision for loan losses		0.00%	5.65%
Provision for unfunded loan commitments		0.51%	0.00%
Tax effect of adjustments		0.73%	-1.48%
Adjusted return on average equity (Non-GAAP)		16.30%	14.60%
Adjusted Efficiency Ratio
Efficiency ratio (GAAP)		39.87%	45.98%
Realized gain on sale of investment securities		N/M	N/M
Unrealized gains on equity securities		N/M	N/M
Accretion of PPP fees, net		N/M	N/M
(Gain) loss from sale of REO		N/M	N/M
Provision for loan losses		N/M	N/M
Provision for unfunded loan commitments		N/M	N/M
Adjusted efficiency ratio (Non-GAAP)		42.85%	45.98%
N/M - Not Meaningful
Appendix A - Reconciliation of Non-GAAP Financial Measures, Continued
		Three Months Ended
		March 31,
		(Dollars in thousands, except per share data)
		2021	2020
Adjusted Net Interest Margin (tax-equivalent) (1)
Net interest margin (tax-equivalent) (GAAP)		3.82%	3.46%
Accretion of PPP fees, net		-0.34%	0.00%
Adjusted net interest margin (tax-equivalent) (Non-GAAP)		3.48%	3.46%
Allowance to Non-PPP loans
Allowance to loans (GAAP)		1.38%	0.89%
Impact of PPP loans		0.15%	0.00%
Allowance to non-PPP loans (non-GAAP)		1.53%	0.89%
Pre-tax Pre-Provision Earnings
Net income (GAAP)		4,860	2,286
Income taxes		1,537	804
Provision for (recovery of) loan losses		-	1,495
Pre-tax Pre-provision earnings (non-GAAP)		6,397	4,585
Pre-tax Pre-Provision Return on Average Assets
Return on average assets (GAAP)		1.73%	0.98%
Impact of excluding income taxes		0.55%	0.34%
Impact of excluding provision for loan losses		-	0.64%
Pre-tax Pre-Provision Return on Average Assets (non-GAAP)		2.27%	1.97%

(1)	See Appendix B to this press release for more information on tax equivalent net interest margin

Appendix B - Tax Equivalent Net Interest Margin Analysis
			For the Three Months Ended March 31,
			2021					2020
			Average					Average
			Outstanding		Yield /			Outstanding		Yield /
			Balance	Interest	Rate			Balance	Interest	Rate
			(Dollars in thousands)
Interest-earning Assets:
	Loans - taxable, including loans held for sale	$	915,474	10,664	4.72%		$	810,039	10,198	5.06%
	Loans - tax exempt (2)		11,569	192	6.75%			-	-	0.00%
	Investments - taxable		69,119	470	2.76%			46,173	265	2.31%
	Investments - tax exempt (1)		12,036	122	4.09%			364	4	4.20%
	Interest earning deposits		72,037	15	0.08%			30,063	51	0.68%
	Other investments, at cost		6,598	36	2.21%			9,439	66	2.81%
	Total interest-earning assets		1,086,833	11,499	4.29%			896,078	10,584	4.75%
	Noninterest earning assets		38,207					36,165
	Total assets	$	1,125,040				$	932,243
Interest-bearing liabilities:
	Interest-bearing transaction accounts	$	31,210	8	0.10%		$	20,837	26	0.50%
	Savings accounts		323,890	252	0.32%			287,862	1,014	1.42%
	Money market accounts		69,795	60	0.35%			60,622	201	1.33%
	Retail time deposits		154,569	406	1.07%			167,514	877	2.11%
	Wholesale time deposits		134,676	128	0.39%			113,949	484	1.71%
	Total interest bearing deposits		714,140	854	0.48%			650,784	2,602	1.61%
	Federal Home Loan Bank & FRB advances		50,000	122	0.99%			36,353	122	1.35%
	Senior debt		13,625	113	3.36%			15,712	153	3.92%
	Subordinated debt		9,779	163	6.76%			-	-	0.00%
	Total interest-bearing liabilities		787,544	1,252	0.64%			702,849	2,877	1.65%
	Noninterest-bearing deposits		222,036					128,640
	Other noninterest-bearing liabilities		9,605					7,853
	Total liabilities		1,019,185					839,342
	Total shareholders' equity		105,855					92,901
	Total liabilities and shareholders' equity	$	1,125,040				$	932,243
	Tax-equivalent net interest income			10,247					7,707
	Net interest-earning assets (3)	$	299,289				$	193,229
	Average interest-earning assets to interest-
	bearing liabilities		138%					127%
	Tax-equivalent net interest rate spread (4)		3.65%					3.10%
	Tax equivalent net interest margin (5)		3.82%					3.46%

(1)	Tax exempt investments are calculated giving effect to a 21% federal tax rate
(2)	Tax exempt loans reflect the tax equivalent yield of a 5% state tax credit
(3)	Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities
(4)	Tax-equivalent net interest rate spread represents the difference between the tax equivalent yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(5)	Tax equivalent net interest margin represents tax equivalent net interest income divided by average total interest-earning assets

 

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SOURCE Mountain Commerce Bancorp, Inc.

FAQ

What is the dividend amount declared by Mountain Commerce Bancorp (MCBI) in April 2021?

Mountain Commerce Bancorp declared a quarterly cash dividend of $0.13 per share on April 26, 2021.

When is the dividend payable for Mountain Commerce Bancorp (MCBI)?

The dividend is payable on June 1, 2021, to shareholders of record as of May 12, 2021.

What was the net income for Mountain Commerce Bancorp (MCBI) for Q1 2021?

The net income for Q1 2021 was $4.86 million, a 13% increase from the previous year.

How did the diluted earnings per share change for Mountain Commerce Bancorp (MCBI) in Q1 2021?

The diluted earnings per share increased to $0.77 in Q1 2021, up 7% from the previous year.

What is the status of non-performing loans for Mountain Commerce Bancorp (MCBI)?

Non-performing loans decreased slightly to 0.18% of total loans as of March 31, 2021.