Southern Banc (PK) (USOTC:SRNN)
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The Southern Banc Company, Inc. (OTCBB: SRNN), the holding company for
The Southern Bank Company, formerly First Federal Savings and Loan
Association of Gadsden, Alabama, announced net loss of $133,060, or
$(0.17) per basic and diluted share, for the year ended June 30, 2008,
as compared to a net loss of $160,883, or $(0.21) per basic and $(0.20)
per diluted share, for the year ended June 30, 2007. For the three month
period ended June 30, 2008, the Company reported a net loss of $20,056,
as compared to a net loss of $30,489 for the three month period ended
June 30, 2007.
In addition to reporting earnings, the Company announced that the annual
meeting of stockholders will be held on November 19, 2008 at 5:00 PM at
the main office of The Southern Bank Company in Gadsden, Alabama. The
voting record date for the purpose of determining stockholders eligible
to vote on proposals presented at the annual meeting is September 26,
2008.
Gates Little, President and Chief Executive Officer of the Company
stated that the Company’s net loss for the
fiscal year ended June 30, 2008 was primarily attributable to an
increase in non-interest expense of approximately $69,000, or 3.0%,
offset in part by an improvement in the net interest margin of
approximately $45,000, or 2.4%. The increase in non-interest expense was
primarily attributable to an increase in salaries and benefits
associated with the addition of one lending officer and one secondary
market loan originator. During the year ended June 30, 2008, total
interest income increased approximately $85,000, or 1.7%, and total
interest expense increased approximately $57,000, or 1.8%.
The Company’s total assets at June 30, 2008
were $102.9 million, as compared to $99.1 million at June 30, 2007.
Total stockholders’ equity at June 30, 2008,
was $15.1 million, or 14.7% of total assets.
The Bank has four offices located in Gadsden, Albertville, Guntersville,
and Centre, Alabama. The stock of The Southern Banc Company, Inc. is
listed on the OTC Bulletin Board.
Certain statements in this release contain “forward-looking
statements” within the meaning of the Private
Securities Litigation Reform Act of 1995, which statements can generally
be identified by the use of forward-looking terminology, such as “may,”
“will,” “expect,”
“estimate,” “anticipate,”
“believe,” “target,”
“plan,” “project,”
“continue,” or the
negatives thereof, or other variations thereon or similar terminology,
and are made on the basis of management’s
plans and current analyses of the Company, its business and the industry
as a whole. These forward-looking statements are subject to risks and
uncertainties, including, but not limited to, economic conditions,
competition, interest rate sensitivity and exposure to regulatory and
legislative changes. The above factors, in some cases, have affected,
and in the future could affect the Company’s
financial performance and could cause actual results to differ
materially from those expressed or implied in such forward-looking
statements, even if experience or future changes make it clear that any
projected results expressed or implied therein will not be realized.
(Selected financial data attached)
THE SOUTHERN BANC COMPANY, INC.
Consolidated Statements of Financial Condition
June 30, 2008 and 2007
Assets
2008
2007
Cash and cash equivalents:
Cash on hand and in other banks
$
3,513,585
$
2,394,900
Interest–bearing deposits in other banks
829,923
2,746,733
Total cash and cash equivalents
4,343,508
5,141,633
Securities available for sale, at fair value
60,321,760
58,784,841
Securities held to maturity (fair value of $112,265 and
$2,615,941, respectively)
93,758
107,638
Federal Home Loan Bank stock
327,800
328,800
Loans held for sale
185,000
—
Loans receivable, net of allowance for loan losses of $192,532 and
$169,908, respectively
35,954,882
32,575,281
Accrued interest and dividends receivable
508,202
537,966
Premises and equipment, net
946,535
988,262
Prepaid expenses and other assets
207,353
668,132
Total assets
$
102,888,798
$
99,132,533
Liabilities and Stockholders’ Equity
Deposits
$
84,368,467
$
82,582,606
Federal Home Loan Bank advances
3,075,350
1,416,667
Other liabilities
282,931
256,754
Total liabilities
87,744,748
84,256,027
Commitments and contingencies
Stockholders’ equity:
Preferred stock, par value $0.01 per share. Authorized 500,000
shares; no shares issued and outstanding
—
—
Common stock, par value $0.01 per share. Authorized 3,500,000
shares; issued 1,454,750 shares in 2007 and 2006
14,548
14,548
Additional paid-in capital
13,886,524
13,997,847
Retained earnings
10,812,325
11,218,497
Shares held in trust, at cost, 25,768 shares
(570,629
)
(570,629
)
Treasury stock, at cost, 648,664 and 645,464 shares in 2007 and
2006, respectively
(8,825,282
)
(8,825,282
)
Accumulated other comprehensive loss
(173,436
)
(958,455
)
Total stockholders’ equity
15,144,050
14,876,526
Total liabilities and stockholders’ equity
$
102,888,798
$
99,132,553
THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollar Amounts in Thousands)
Three Months Ended
Twelve Months Ended
June 30,
June 30,
2008
2007
2008
2007
INTEREST INCOME:
Interest and fees on loans
$
527
543
2,124
1,987
Interest and dividends on securities available for sale
725
729
2,977
2,888
Interest and dividends on securities held to maturity
2
2
7
71
Other interest income
12
43
118
195
Total interest income
1,266
1,317
5,226
5,141
INTEREST EXPENSE:
Interest on deposits
729
802
3,122
3,063
Interest on borrowings
21
20
129
131
Total interest expense
750
822
3,251
3,194
Net interest income
516
495
1,975
1,947
Provision for loan losses
10
8
18
35
Net interest income after provision for loan losses
506
487
1,957
1,912
NON-INTEREST INCOME:
Customer service fees
44
32
127
119
Gain on sale of securities
0
1
67
11
Miscellaneous income, net
3
4
13
9
Total non-interest income
47
37
207
139
NON-INTEREST EXPENSE:
Salaries and employee benefits
355
309
1,364
1,293
Office building and equipment expenses
52
56
206
267
Professional service expense
43
71
221
229
Data processing expense
68
63
267
220
Other operating expense
67
74
320
300
Total non-interest expense
585
573
2,378
2,309
Loss (income) before income taxes
(32
)
(49
)
(214
)
(258
)
Provision for income tax (benefit) expense
(12
)
(18
)
( 81
)
(97
)
Net (loss) income
$
(20
)
(31
)
(133
)
(161
)
========
========
========
========
Earnings per share – Basic
$
(0.03
)
(0.04
)
(0.17
)
(0.21
)
Earnings per share – Diluted
$
(0.03
)
(0.04
)
(0.17
)
(0.20
)
Dividends declared per share
$
0.0875
0.0875
0.3500
0.3500
THE SOUTHERN BANC COMPANY, INC.
Consolidated Statements of Cash Flows
Years ended June 30, 2008 and 2007
2008
2007
Cash flows from operating activities:
Net (loss) income
$
(133,060
)
(160,883
)
Adjustments to reconcile net (loss) income to net cash (used in)
provided by Operating activities:
Depreciation
86,276
105,384
Amortization of premiums/discounts on securities, net
(9,246
)
(25,134
)
Provision for loan losses
18,000
35,075
Deferred income tax (benefit) provision
(99,799
)
(99,758
)
Loss (gain) on loans held for sale
2,865
419
Proceeds from sale of loans held for sale
2,405,235
1,985,431
Loans originated for sale
(2,593,100
)
(1,922,650
)
(Gain) loss on sale of available for sale securities, net
(65,500
)
277
Change in assets and liabilities:
Decrease (increase) in accrued interest and dividends receivable
29,764
(28,751
)
Decrease (increase) in prepaid expenses and other assets
(14,264
)
(13,588
)
(Decrease) increase in other liabilities
14,653
66,650
Net cash (used in) provided by operating activities
(358,176
)
(57,528
)
Cash flows from investing activities:
Purchase of securities available for sale
(23,351,527
)
(15,120,556
)
Proceeds from maturities and principal payments on securities
Available for sale
20,083,866
12,288,690
Proceeds from sales of securities available for sale
3,065,500
2,319,997
Proceeds from sales of securities held to maturity
—
930,352
Proceeds from maturities and principal payments on securities held
to maturity
13,930
1,545,689
Sale of Federal Home Loan Bank stock
1,000
165,600
Loan repayments, net
(3,397,601
)
1,099,896
Capital expenditures, net
(44,549
)
(47,183
)
Net cash (used in) provided by investing activities
(3,629,381
)
3,182,485
Cash flows from financing activities:
Purchase of treasury stock
—
(49,595
)
Federal Home Loan Bank proceeds
3,075,350
—
Federal Home Loan Bank repayments
(1,416,667
)
(3,833,333
)
Cash dividends paid
(273,112
)
(273,392
)
Increase in deposits, net
1,803,861
412,933
Proceeds from exercise of stock options
—
29,126
Net cash provided by (used in) financing activities
3,189,432
(3,714,261
)
Net decrease in cash and cash equivalents
(798,125
)
(589,304
)
Cash and cash equivalents, beginning of year
5,141,633
5,730,937
Cash and cash equivalents, end of year
$
4,343,508
5,141,633
Supplemental cash flow information:
Cash (received) paid during the year for:
Income taxes, net of refund received
$
—
(53,477
)
Interest
3,256,876
3,206,472