SBT Bancorp, Inc. Reports First Quarter 2013 Results

SBT Bancorp, Inc., (OTCBB: SBTB), holding company for Simsbury Bank & Trust Company, today announced net income of $517,000 or $0.56 per diluted share for the first quarter of 2013, compared to $481,000 or $0.47 per diluted share for the first quarter of 2012. Total assets on March 31, 2013 were $396 million, an increase of $34 million or 9% over March 31, 2012. Key financial highlights for the first quarter of 2013 compared to the first quarter of 2012 include earnings and balance sheet growth, favorable asset quality, and a well capitalized regulatory capital position: • Earnings per share increased by $0.09 or 19% • Net income increased by $36 thousand or 8% • Non-interest income increased by $326 thousand or 46% • Total assets increased by $34 million or 9% • Total deposits grew by $32 million or 10% • Loans outstanding grew by $18 million or 8% • Asset quality remained very favorable with total non-accrual loans and loans 30 or more days past due at 1.09% of loans outstanding on March 31, 2013. • The Bank’s Total Risk Based Capital ratio ended the first quarter of 2013 at 14.48%. “Double-digit growth in commercial loans, residential mortgages and core deposits produced a solid quarter of earnings for SBT Bancorp,” stated SBT Bancorp President and CEO, Martin J. Geitz. “During the quarter, strong revenue growth generated by residential mortgage loan activity more than offset a decline in our net interest margin. The continuing low level of interest rates is negatively impacting net interest margins of financial institutions throughout the industry. Looking forward, our focus is on building our commercial, residential mortgage, and retail lines of business to drive revenue growth and enhance shareholder value.” Total deposits on March 31, 2013 were $361 million, an increase of $32 million or 10% over a year ago. This growth was mainly in Core deposits (Demand, Savings and NOW accounts). At quarter-end, 26% of total deposits were in non-interest bearing demand accounts, 54% were in low-cost savings and NOW accounts, and 20% were in time deposits. On March 31, 2013, loans outstanding were $240 million, an increase of $18 million, or 8%, over a year ago. Commercial loans grew by $10 million or 16%, Residential mortgage loans grew by $11 million or 10%, and Consumer loans declined by $3 million or 4%. The profile of the Company’s loan portfolio remains relatively low-risk. The Company’s allowance for loan losses at March 31, 2013 was 1.09% of total loans. The Company had non-accrual loans totaling $1.2 million equal to 0.51% of total loans on March 31, 2013 compared to non-accrual loans totaling $1.1 million or 0.47% of total loans a year ago. Total revenues, consisting of net interest and dividend income plus noninterest income, were $3,696,000 in the first quarter compared to $3,396,000 a year ago, an increase of $300,000 or 9%. Net interest and dividend income decreased by $27,000 or 1%, while noninterest income increased by $326,000 or 46% primarily due to an increase in the gain on loans sold. The Company’s taxable-equivalent net interest margin (taxable-equivalent net interest and dividend income divided by average earning assets) was 3.03% for the first quarter of 2013, compared to 3.17% for the first quarter of 2012. The Company’s cost of funds declined 8 bps while the yield on interest earning assets decreased 21 bps during the first quarter of 2013, compared to the first quarter of 2012. Total noninterest expenses increased $344,000 or 13% in the first quarter 2013 compared to first quarter 2012. The increase in expenses was primarily attributable to strategic initiatives targeted to grow revenues. Salaries and employee benefit expenses increased $356,000 or 26%. Equipment expense, forms and supplies, professional fees, correspondent charges, postage, and other expenses all decreased compared to the first quarter of 2012. Capital levels for the Simsbury Bank & Trust Company on March 31, 2013 were above those required to meet the regulatory “well-capitalized” designation. Simsbury Bank is an independent, publicly owned community bank for consumers and businesses. The Bank is based in Central Connecticut’s Farmington Valley and serves customers locally through branches in Avon, Bloomfield, Granby and Simsbury and regionally through mortgage and commercial bankers active throughout Southern New England. Simsbury Bank’s parent company is SBT Bancorp, Inc. whose stock is traded under the ticker symbol OTCBB: SBTB. Simsbury Bank customers enjoy online banking and mortgage services at, respectively, www.simsburybank.com and www.simsburybank.com/mortgages. Bank customers have free ATM access at thousands of machines across the country through the SUM program. The Bank offers financial planning, investment and insurance products through LPL Financial and its affiliates, member FINRA/SIPC. Certain statements in this press release, including statements regarding the intent, belief or current expectations of SBT Bancorp, Inc., The Simsbury Bank & Trust Company, or their directors or officers, are “forward-looking” statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.