First Quarter Earnings 2019

Close up of a man working about financial with calculator at his office to calculate expenses

Union Bank Releases First Quarter Earnings and Announces Cash Dividend of $0.0975 Per Share

Greenville, NC – (Business Wire) – April 29, 2019 – Union Bank (OTCQX: UBNC) reports earnings results for the quarter ended March 31, 2019 and announces cash dividend of $0.0975 per share.

Union Bank (the “Bank”) is pleased to report earnings results for the quarter ended March 31, 2019.  Unaudited net income for the three months ended March 31, 2019 was $1,639,000 or $0.27 per basic common share, compared to $1,501,000, or $0.25 per basic common share for the same period in the prior year.  This represents a 9.2% increase in earnings for the comparable three-month periods.  Return on average assets and return on average equity was 0.87% and 8.38%, respectively, for the three months ended March 31, 2019.  Return on average tangible common equity was 10.20% for the first quarter.

Total assets as of March 31, 2019 were $770.6 million, compared to total assets of $745.2 million as of December 31, 2018, and $706.3 million as of March 31, 2018.  Total loans, net of reserves, were $514.4 million and deposits were $638.7 million, as of March 31, 2019 compared to net loan balances of $501.7 million and deposits of $600.1 million as of March 31, 2018.  Asset quality remains excellent, total non-performing assets were 0.13% of total assets as of March 31, 2019.  Capital levels remain strong, total risk-based capital was 14.04%, common equity tier 1 to risk-weighted assets was 12.16%, and the Bank’s tier 1 leverage ratio was 8.89% at quarter-end.  As of March 31, 2019, shares of common stock issued an outstanding totaled 5,980,610.

Rob Jones, President and Chief Executive Officer stated, “We are pleased to report strong earnings for the first quarter of 2019.  We are also pleased that loan and deposit levels continue to increase at a steady pace.  Gross loans and deposits have grown at an annualized rate of 7.5% and 7.4%, respectively, since December 31, 2018.  Our loan quality metrics remain outstanding.  As previously stated, the Bank intends to maintain lending discipline as we work towards a natural contraction of the economic cycle.”

Union Bank also announced today that its Board of Directors, on April 18, 2019, approved a semi-annual cash dividend of $0.0975 per share on the Bank’s common stock.  The cash dividend is payable on June 28, 2019 to shareholders of record at the close of business on June 14, 2019.

Union Bank is headquartered in Greenville, North Carolina and operates 15 branches located in 11 counties throughout Eastern and Central North Carolina.  Union Bank stock is traded on the OTCQX under the symbol UBNC.

This press release includes certain forward-looking statements in reliance on the “safe-harbor” provisions of The Private Securities Litigation Reform Act of 1995.  Any such forward-looking statements are subject to a number of risks and uncertainties.  Actual results may differ materially from those anticipated in any such forward-looking statements.  The Bank undertakes no obligation to update or revise any such forward-looking statements.  This press release contains financial information determined by methods other than in accordance with GAAP. The Bank’s management uses these non-GAAP financial measures in their analysis of the Bank’s performance. These measures typically adjust GAAP performance measures to exclude the effects of transactions that are infrequent in nature.   Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Bank’s core businesses.

For More Information Contact:

Doyle M. Thigpen
Chief Financial Officer
(252) 317-2804

Union Bank Summary of Operations (un-audited)
($000’s omitted except per share data)

Three Months Ended
March 31, 2019
(un-audited)
Three Months Ended
March 31, 2018
(un-audited)
Interest Income $8,242 $7,335
Interest Expense 1,655 916
Net Interest Income 6,587 6,439
Provision for loan losses 212 225
Net interest income after Provision for losses 6,375 6,214
Non-interest income 820 789
Non-interest expense 5,148 5,104
Income before taxes 2,047 1,899
Income taxes 408 398
Net Income $1,639 $1,501
Net Income available per basic common share $0.27 $0.25

Union Bank
Balance Sheets ($000’s omitted)

March 31, 2019
(un-audited)
December 31, 2018* March 31, 2017
(un-audited)
Assets
Cash and due from banks $9,236  $9,355 $6,581
Interest-bearing deposits with banks 40,706 25,753 33,035
Investment securities AFS 147,209 148,575 108,252
Loans – gross 523,257 513,675 512,671
Net Fair Value Marks (4,619) (5,047) (7,266)
Allowance for loan losses (4,251) (4,046) (3,729)
Net Loans 514,387  504,582 501,676
Bank premises and equipment, net 19,422 16,793 17,058
Other Real Estate Owned 108 327 627
Goodwill 12,897 13,466 13,466
Core Deposit Intangibles 1,759 1,951 2,586
Bank-Owned Life Insurance 16,559 16,450 16,113
Other Assets 8,309 7,934 6,869
Total Assets $770,592 $745,186 $706,263
Liabilities & Stockholders’ Equity
Liabilities
Deposits $638,703  $627,171 $610,110
Advances from the Federal Home Loan Bank 41,000 32,000 32,000
Subordinated Debentures 6,000 6,000
Accrued Expenses and Other liabilities 4,179  1,821 712
Total Liabilities 689,882 666,992 632,822
Stockholders’ Equity
Common stock, no par value 71,668 71,879 69,080
Retained earnings 9,268 7,629 6,267
Accumulated other comprehensive income loss (226) (1,314) (1,906)
Total stockholders’ equity $80,710 $78,194 $73,441
Total liabilities and stockholders’ equity $770,592 $745,186 $706,263

*Derived from audited financial statements