First Quarter Earnings 2020

Union Bank Releases Earnings for the Quarter Ended March 31, 2020

Greenville, NC – (Business Wire) – April 28, 2020 – Union Bank (OTCQX: UBNC) (the “Bank”) is pleased to report its results for the quarter ended March 31, 2020.

Net income for the first quarter of 2020 was $1.7 million or $0.29 per basic common share and compared favorably to the $1.6 million or $0.27 per basic common share earned for the same period in 2019.  The Bank’s return on average assets and average tangible equity for the first quarter of 2020 was 0.84% and 9.53%, respectively.  Revenues continue to be positively impacted by solid growth in both our loan portfolio as well as our noninterest bearing checking balances.

Total assets as of March 31, 2020 were $866.5 million, an increase of $45.2 million or 5.5%, compared to $821.3 million at December 31, 2019.  Over this same three-month time period gross loans grew $21.1 million or 3.6%.  Total deposits at March 31, 2020 were $675.2 million compared to $678.2 million at December 31, 2019.  During this same time period noninterest bearing deposits increased $5.1 million or 2.4% to $219.4 million.  

The Bank’s loan growth has remained strong as we continued to focus our lending efforts on high quality borrowers.  As a result, asset quality remains excellent with total non-performing assets representing only 0.06% of total assets as of March 31, 2020.  We anticipate that as a result of the impacts Covid-19 pandemic, some of our customers will face economic challenges.  As we work with our borrowers, we anticipate that our asset quality metrics could be negatively impacted in future periods.  However, our capital levels remain strong, total risk-based capital was 13.00%, common equity tier 1 to risk-weighted assets was 11.23%, and the Bank’s tier 1 leverage ratio was 8.81% at quarter-end.  As of March 31, 2020, the number of shares of common stock issued and outstanding totaled 5,933,960.

Rob Jones, President and Chief Executive Officer stated, “We are very pleased to report our first quarter results and continue to focus on our customers and running our Bank each and every day as we have done for over 20 years.  Our success has been anchored in our ability to service our customers.  This has allowed us to build a solid foundation from which to grow our organization.  This solid foundation allows us to continue to serve our customers in times of economic challenges.  Union Bank remains a strong and secure financial institution.  In response to the Covid-19 virus, our dedicated associates (“Financial First Responders”) continue to work every day to provide the banking services our customers need.  We are a proud participant in the Payroll Protection Loan Program (PPP).  Union Bank has provided nearly $40.0 million of PPP funding to our local communities.  We are proud of our role and are thankful we can continue to service our customers”. 

Mr. Jones continued by noting, “it may take several weeks and possibly months to properly forecast the impact of Covid-19 on the banking industry and our Bank.  We are confident of our position to weather this crisis and look forward to a more positive operating environment.”

Union Bank is headquartered in Greenville, North Carolina and operates 15 branches located in 12 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:

Scott C. McLean
Chief Financial Officer
(252) 917-5735

Union Bank
Balance Sheets ($000’s omitted)

As of the Period Ended
March 31, 2020
(un-audited)
December 31, 2019* March 31, 2019
(un-audited)
ASSETS
Cash and due from banks $10,997  $9,359 $9,236
Interest-bearing deposits with banks 18,996 16,867 40,706
Investment securities available-for-sale 181,094 164,040 147,209
Loans – gross 601,143 580,024 523,257
Net fair value marks (2,397) (3,285) (4,619)
Allowance for loan losses (5,321) (4,988) (4,251)
Net Loans 593,425  571,751 514,387
Bank premises and equipment, net 18,636 18,819 19,422
Bank-owned life insurance 17,009 16,897 16,559
Other real estate owned 108
Goodwill 12,897 12,897 12,897
Core deposit intangible 1,091 1,243 1,759
Other assets 12,384 9,448 8,309
Total Assets $866,529 $821,321 $770,592
LIABILITIES & STOCKHOLDERS’ EQUITY
Liabilities
Deposits $675,216  $678,190 $638,703
Advances from the Federal Home Loan Bank 85,225 47,000 41,000
Subordinated debentures 6,000 6,000 6,000
Other borrowings 10,000
Accrued expenses and other liabilities 4,615 4,686 4,179
Total Liabilities 781,056 735,876 689,882
Stockholders’ Equity
Common stock, no par value 70,713 70,928 71,668
Retained earnings 15,356 13,623 9,268
Accumulated other comprehensive income / (loss) (596) 894 (226)
Total Stockholders’ Equity $85,473 $85,445 $80,710
Total Liabilities and Stockholders’ Equity $866,529 $821,321 $770,592

*Derived from audited financial statements

 

Union Bank

Statements of Operations
($000’s omitted except per share data)

For the Three Months Ended
March 31, 2020
(un-audited)
March 31, 2019
(un-audited)
Interest Income $8,730 $8,259
Interest Expense 1,719 1,655
Net Interest Income 7,011 6,604
Provision for Loan Losses 355 212
Net Interest Income after Provision for Loan Losses 6,656 6,392
Noninterest Income 806 704
Noninterest Expense 5,319 5,049
Income Before Income Taxes 2,143 2,047
Income Taxes 410 408
Net Income $1,733 $1,639
Net Income Available Per Basic Common Share $0.29 $0.27