National Commerce Corporation (NCOM) has reported a 67.02 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $4.91 million, or $0.44 a share in the quarter, compared with $2.94 million, or $0.28 a share for the same period last year.
Revenue during the quarter grew 21.44 percent to $20.02 million from $16.49 million in the previous year period. Net interest income for the quarter rose 13.41 percent over the prior year period to $16.99 million. Non-interest income for the quarter rose 62.55 percent over the last year period to $3.47 million.
National Commerce Corporation has made provision of $0.44 million for loan losses during the quarter, down 30.11 percent from $0.63 million in the same period last year.
Net interest margin contracted 7 basis points to 3.99 percent in the quarter from 4.06 percent in the last year period. Efficiency ratio for the quarter improved to 59.33 percent from 66.86 percent in the previous year period. A decline in efficiency ratio indicates a rise in profitability.
"We are pleased to report a good year of growth in the company in 2016, along with expansion in our profitability," said John H. Holcomb, III, chairman and chief executive officer of the Company. "Our fourth quarter return on average assets of 1.05% brought the year’s total to 1.00%, and our diluted earnings per share of $1.61 for the year represents a 58% increase over 2015 levels. We are also pleased with our asset quality performance, though, as always, we can never consider ourselves satisfied in this very important area of our business."
Liabilities outpace assets growth
Total assets stood at $1,951.66 million as on Dec. 31, 2016, up 10.68 percent compared with $1,763.37 million on Dec. 31, 2015. On the other hand, total liabilities stood at $1,714.61 million as on Dec. 31, 2016, up 10.85 percent from $1,546.73 million on Dec. 31, 2015.
Loans outpace deposit growth
Net loans stood at $1,473.37 million as on Dec. 31, 2016, up 12.51 percent compared with $1,309.57 million on Dec. 31, 2015. Deposits stood at $1,667.71 million as on Dec. 31, 2016, up 10.12 percent compared with $1,514.46 million on Dec. 31, 2015. Noninterest-bearing deposit liabilities were $429.03 million or 25.73 percent of total deposits on Dec. 31, 2016, compared with $382.95 million or 25.29 percent of total deposits on Dec. 31, 2015.
Investments stood at $107.59 million as on Dec. 31, 2016, up 23.53 percent or $20.49 million from year-ago. Shareholders equity stood at $237.04 million as on Dec. 31, 2016, up 9.42 percent or $20.41 million from year-ago.
Return on average assets moved up 33 basis points to 1.05 percent in the quarter from 0.72 percent in the last year period. At the same time, return on average equity increased 257 basis points to 8.33 percent in the quarter from 5.76 percent in the last year period.
Credit quality improves
National Commerce Corporation recorded an improvement in credit quality during the quarter. Nonperforming assets to total loans was 0.37 percent in the quarter, down from 0.60 percent in the last year period. Meanwhile, nonperforming assets to total assets was 0.28 percent in the quarter, down from 0.45 percent in the last year period.
Capital ratios deteriorate
National Commerce Corporation witnessed a deterioration in capital ratios during in the quarter. Tier-1 leverage ratio stood at 9.57 percent for the quarter, down from 9.68 percent for the previous year quarter. Equity to assets ratio was 12.15 percent for the quarter, down from 12.29 percent for the previous year quarter. Book value per share was $21.68 for the quarter, up 8.35 percent or $1.67 compared to $20.01 for the same period last year.
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