Oak Ridge Financial Services, Inc. Announces First Quarter 2020 Results and Quarterly Cash Dividend of $0.06 Per Share
OAK RIDGE, N.C., April 30, 2020 (GLOBE NEWSWIRE) — Oak Ridge Financial Services, Inc. (the “Company”) (OTCPink: BKOR), the parent company of Bank of Oak Ridge (the “Bank”), announced unaudited financial results for the three months ended March 31, 2020 and a quarterly cash dividend of $0.06 per share.
First Quarter 2020 HighlightsBasic and diluted earnings per share of $0.07 for the three months ended March 31, 2020, down 32 cents from the same period in 2019Provision for loan losses of $1.1 million for the three months ended March 31, 2020, compared to no provision for the same period in 2019Annualized return on average common stockholders’ equity of 1.68% for the three months ended March 31, 2020, compared to 11.61% for the same period in 2019Tangible book value per common share of $15.22 at March 31, 2020, up $1.42, or 10.3%, from March 31, 2019Period end loans of $403.2 million, up 14.8% (annualized) from December 31, 2019Period end deposits of $413.0 million, up 15.1% (annualized) from December 31, 2019Period end nonperforming assets of $3.8 million, down slightly from $3.9 million at December 31, 2019Tom Wayne, Chief Executive and Chief Financial Officer, reported, “Our first quarter results reflect a $1.1 million provision for loan losses to prepare for the economic challenges our borrowers may face as a result of the ongoing COVID-19 pandemic. Even with this significant provision I am pleased we remained profitable for the first three months of 2020. While it is difficult to accurately predict the next few quarters and the impact of COVID-19 on our local and national economy, I am thankful to have our experienced team of bankers and a supportive board of directors as we address future challenges and opportunities.”The Company announced that its board of directors has declared a quarterly cash dividend of $0.06 per share of common stock. The dividend will be paid on or about June 2, 2020 to stockholders of record as of the close of business on May 18, 2020. “We are pleased to announce our quarterly cash dividend to our stockholders,” said Tom Wayne. “We believe that paying stockholders a portion of our earnings reflects our continuing commitment to enhance stockholder value.”The Company also announced that effective as of the close of business on April 27, 2020, the Bank became a member bank of the Federal Reserve System through the Federal Reserve Bank of Richmond. The conversion from the Federal Deposit Insurance Corporation (“FDIC”) to the Federal Reserve System is not expected to affect the Bank’s clients in any way, and they will continue to receive the same insurance on deposits through the FDIC’s deposit insurance fund. The Bank’s capital ratios remain strong and exceed all regulatory requirements at March 31, 2020. As of March 31, 2020, the Company’s stockholders’ equity was 8.2% of total assets, down from 8.5% as of December 31, 2019.With respect to the consolidated statement of operations, net interest income before provision for loan losses was $4.0 million for the first three months of 2020, which was slightly higher than the same period in 2019. For the three months ended March 31, 2020, the net interest margin was 3.55% compared to 3.72% for the same period in 2019, a decrease of 17 basis points.The Company recorded a provision for loan losses of $1.1 million for the three months ended March 31, 2020, compared with no provision for the same period in 2019. The allowance for loan losses as a percentage of total loans was 1.00% at March 31, 2020 compared to 0.90% at December 31, 2019. The increase in the allowance for loan losses in 2020 was largely the result of the Company increasing the qualitative factors in its allowance for loan loss model due to the deteriorating economic outlook related to COVID-19. Nonperforming assets represented 0.78% of total assets at March 31, 2020, compared to 0.82% at December 31, 2019.Noninterest income totaled $673,000 for the three months ended March 31, 2020, compared with $601,000 for the same period in 2019, an increase of $72,000 or 12.0%. The biggest noninterest income categories contributing to the net increase were increases in service charges on deposit accounts and debit and credit card interchange income, which increased $36,000 and $37,000, respectively, from 2019 to 2020.Noninterest expense totaled $3.3 million for the three months ended March 31, 2020, compared with $3.4 million for the same period in 2019, a decrease of $30,000 or 0.9%. The majority of the decrease was due to an aggregate decrease in salaries from 2019 to 2020. Salaries decreased primarily due to lower quarterly incentive accruals in 2020, partially offset by annual merit increases effective January 1, 2020.About Oak Ridge Financial Services, Inc.
Oak Ridge Financial Services, Inc. (OTCPink: BKOR) is the holding company for Bank of Oak Ridge. Bank of Oak Ridge delivers personal attention and convenience for every client. Substantially all of the Bank’s employees are stockholders in Oak Ridge Financial Services, Inc. through their participation in the Bank’s Employee Stock Ownership Plan. We are proud of our many accolades and awards, including seven “Best Bank in the Triad” wins, “Triad’s Top Workplace” finalist, “Triad’s Healthiest Employer” winner and a 2016 Better Business Bureau “Torch Award” winner. We offer a complete range of banking services for individuals and businesses. Bank of Oak Ridge is a member of the FDIC and an Equal Housing Lender.Banking Services | ATM Usage Worldwide | Mobile Banking | Online Billpay | Remote and Mobile Deposit | Checking | Savings | Mortgage | Insurance | Lending | Wealth ManagementVisit Us | To learn more, visit us during our extended weekday and Saturday hours at one of our convenient locations in Greensboro, Summerfield and Oak Ridge, North Carolina, or call 336.644.9944, or online at www.BankofOakRidge.com.Forward-looking InformationThis earnings release contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate” and “believe,” variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, (1) competition in the Company’s markets, (2) changes in the interest rate environment, (3) general national, regional or local economic conditions may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and the possible impairment of collectability of loans, (4) legislative or regulatory changes, including changes in accounting standards, (5) significant changes in the federal and state legal and regulatory environment and tax laws, and (6) the impact of changes in monetary and fiscal policies, laws, rules and regulations. The Company undertakes no obligation to update any forward-looking statements.
1AnnualizedContact: Tom Wayne, President and CFO
Phone: 336-644-9944