Crescent Financial Corporation, parent company of Crescent State Bank in Cary, North Carolina and Port City Capital Bank in Wilmington, North Carolina today announced unaudited net income for the year ended December 31, 2006 of $4,904,000 reflecting a 56% increase over net income of $3,144,000 for the year ended December 31, 2005. Diluted earnings per share for the current year increased by 13% to $.69 compared to split-adjusted diluted earnings per share of $.61 for the prior year period. The percentage increase in earnings per share was not comparable to the increase in net income due to the issuance of an additional 848,000 shares during the fourth quarter of 2005 and 2,432,000 shares in connection with the acquisition of Port City Capital Bank on August 31, 2006. The increase in net income for 2006 was primarily the result of strong earning asset growth.
Average earning assets for 2006 increased by approximately $137.9 million to $491.8 million compared to $353.9 million for 2005. Earning asset growth resulted in the increase of net interest income by 39% from $14.0 million in 2005 to $19.4 million in 2006. Non-interest income increased by 8% from $2.4 million to $2.6 million. Non-interest expenses increased by 24% from $10.8 million to $13.4 million primarily in the areas of personnel, occupancy and data processing expenses as the Company opened a new loan production office and a full-service branch office in Raleigh, North Carolina during the first and second quarters, respectively, and acquired Port City Capital Bank of Wilmington, North Carolina during the third quarter. The loan loss provision was $991,000 for the year ended December 31, 2006 compared to $807,000 for the prior year.
Unaudited net income for the three-month period ended December 31, 2006 was $1,643,000 or $.19 per diluted share compared with $1,005,000 or $.18 per split-adjusted diluted share for the three-month period ended December 31, 2005. In comparing results for the two quarterly periods, net income increased by 63%, net interest income increased by 59%, non-interest income increased by 4% and non-interest expenses increased by 32%. The loan loss provision was $374,000 for the current three-month period compared to $60,000 for the prior year period.
Crescent Financial Corporation reported total assets on December 31, 2006 of $697.9 million reflecting a 70% increase over total assets of $410.8 million on December 31, 2005. Total net loans increased by 68% from $324.0 million at December 31, 2005 to $542.9 million at December 31, 2006. Total deposits increased 68% from $322.1 million at December 31, 2005 to $541.9 million at December 31, 2006. Total stockholders’ equity grew by 100% from $41.5 million at December 31, 2005 to $83.0 million at December 31, 2006. The increase was primarily due to the acquisition of Port City Capital Bank and net income for the year.
Mike Carlton, President and CEO stated, “This past year reflects the results of our plan and continued commitment to build a top-performing financial institution. We are pleased to be able to report to our shareholders the significant increases in both balance sheet and net income over the past twelve months. This most recent quarter reflects the first full period of combined earnings from the completed merger with Port City Capital Bank. Our successes during the year would not have been possible without the dedication and focus from each of our employees.
As we move into 2007 and beyond, our branch network will increase more rapidly than in prior years as we seek out additional expansion opportunities. We have identified several banking locations in the Greater Raleigh area and Southeastern North Carolina, and hope to open three new offices by the end of 2007. Through our existing branch network and other identified communities, we are well positioned for further successes.”
Crescent State Bank is a state chartered bank operating ten banking offices in Cary (2), Apex, Clayton, Holly Springs, Southern Pines, Pinehurst, Sanford, Garner and Raleigh, North Carolina and one loan production office in Raleigh, North Carolina. Port City Capital Bank is a state chartered bank operating one full-service banking office in Wilmington, North Carolina. Crescent Financial Corporation stock can be found on the NASDAQ Global Market trading under the symbol CRFN.
Information in this press release contains "forward-looking statements." These statements involve risks and uncertainties that could cause actual results to differ materially, including without limitation, the effects of future economic conditions, governmental fiscal and monetary policies, legislative and regulatory changes, the risks of changes in interest rates and the effects of competition. Additional factors that could cause actual results to differ materially are discussed in Crescent Financial Corporation’s recent filings with the Securities Exchange Commission, including but not limited to its Annual Report on Form 10-K and its other periodic reports.