Second Quarter Earnings 2017

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FOR IMMEDIATE RELEASE
CONTACT: Doyle M. Thigpen, Chief Financial Officer (252) 317-2804
DATE: July 25, 2017

Union Bank (formerly known as the little bank) releases second quarter earnings today

Greenville, NC – (Business Wire) – July 25, 2017 – Union Bank (OTCQX: UBNC) reports earnings results for the quarter and six months ended June 30, 2017.

Union Bank (the “Company”), formerly known as the little bank prior to its recent acquisition, is pleased to report earnings results for the quarter ended June 30, 2017. Unaudited net income for the three months ended June 30, 2017 was $846,000, or $.25 per basic share, compared to $793,000 or $.23 per basic share for the quarter ended June 30, 2016. Core earnings, which exclude merger expenses, were approximately $896,000 for the three months ended June 30, 2017, compared to $793,000 for the quarter ended June 30, 2016. This represents a 13.0% increase in core earnings. The little bank’s planned acquisition of Oxford, NC based Union Banc Corp. was completed on July 7, 2017. Under the terms of the merger agreement, the little bank agreed to change its name to Union Bank and establish its headquarters in Greenville, NC effective with the merger.

Unaudited net income for the first six months of 2017 was $1,520,000, or $.45 per basic share, compared to $1,556,000, or $.46 per basic share for the first six months of 2016. Core earnings, which exclude merger expenses, were approximately $1,678,000 for the six month period ended June 30, 2017, compared to $1,556,000 for the same six month period in 2016. This represents a 7.8% increase in core earnings.

Total assets as of June 30, 2017 were $381.3 million, compared to total assets of $361.9 million as of June 30, 2016, representing an increase of 5.4%. Total loans, net of reserves, were $259.1 million and deposits were $313.9 million, representing an increase of 4.5% in loan balances and an increase of 6.9% in deposit balances, over the same period in the prior year. As of June 30, 2017, 3,373,974 shares of common stock were issued and outstanding.

Vincent R. Jones, President and Chief Executive Officer stated, “We are pleased to present a very positive earnings report for the second quarter and first six months of 2017.” Jones added, “We continue to be excited about the acquisition of Union Banc Corp. and the anticipated results of this strategic combination.”

As previously reported in a press release dated July 7, 2017, the little bank completed its acquisition of Union Bank and Trust on July 7th. The “new” 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 trading under the symbol UBNC. Upon completion of the merger Union Bank is approximately $700 million in assets.

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 Company 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 Company’s management uses these non-GAAP financial measures in their analysis of the Company’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 Company’s core businesses.

the little bank Summary of Operations (un-audited) (000’s omitted except per share data)

Three Months
Ended
June 30, 2017
Three Months
Ended
June 30, 2016
Six Months
Ended
June 30, 2017
Six Months
Ended
June 30, 2016
Interest Income$3,481$3,301$6,758$6,537
Interest Expense355316667625
Net Interest Income3,1262,9856,0915,912
Provision for loan losses0000
Net interest income after Provision for losses3,1262,9856,0915,912
Non-interest income553441987849
Non-interest expense2,3712,2534,7944,461
Income before taxes1,3081,1732,2842,300
Income taxes462380764744
Net Income$846$793$1,520$1,556
Net Income available per basic common share$0.25$0.23$0.45$0.46

the little bank Balance Sheets (000’s omitted except per share data)

June 30, 2017
(un-audited)
December 31, 2016June 30, 2016
(un-audited)
Assets
Cash and due from banks$9,128$9,085$6,668
Overnight investments10,3566,0705,345
Investment securities AFS84,34785,74484,681
Loans262,201246,522251,440
Less Allowance for loan losses(3,058)(3,444)(3,496)
Net Loans259,143243,078247,944
Other Real Estate Owned05045
Other Assets18,29517,98217,238
Total Assets381,269362,009361,921
Liabilities & Stockholders’ Equity
Liabilities
Deposits$313,899$300,574$293,674
FHLB Advances28,00024,00031,000
Other liabilities992837770
Total Liabilities342,891325,411325,444
Stockholders’ Equity
Common stock, no par value31,57831,50729,416
Retained earnings6,7825,5446,354
Accumulated other comprehensive income (loss)18(453)707
Total stockholders’ equity$38,378$36,598$36,477
Total liabilities and stockholders’ equity$381,269$362,009$361,921

*Derived from audited financial statements