By Lauren Ratcliffe
Published Jan. 24, 2013
Mount Pleasant-based Southcoast Financial Corp. announced 2012 earnings of $3.5 million, reversing a loss of $16 million in 2011.
For the year, the bank holding company earned $0.57 per share compared with a loss of $2.71 per share last year. The basic average shares totaled 6.13 million for 2012 and 6.1 million in 2011.
The bank attributes the financial success in 2012 to an improved ratio of nonperforming assets to total assets and a reduction in the allowance for loan losses.
“The improvement in 2012 earnings compared to 2011 was primarily the result of lower nonperforming assets, which led to reductions in our loan provision and expenses associated with other real estate owned,” said Wayne Pearson, chairman and CEO. “Additionally, our company achieved improvement in our net interest margin due to a lower cost of funds resulting from the downward repricing of our interest bearing liabilities.”
In 2011, losses included a $10 million provision for loan losses and a $4.5 million income tax expense related to a full write-off of the company’s deferred tax asset. In 2012, the provision for loan losses was reduced to $880,000 and income tax expenses totaled $137,000.
Pearson said he looks forward to this year because of the position the bank put itself in during 2012.
"We continue to be encouraged by the future direction of our company given our capital strength, the reduction in nonperforming assets and our continued improvement in the net interest margin," he said.