1st Capital Bank announced second quarter and year to date financial results through June 30, 2015. Earnings for the three and six month periods ended June 30, 2015 increased 32.1% and 50.9%, respectively, from the same periods during 2014.
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Net income during the second quarter of 2015 was $601 thousand, equivalent to $0.15 per diluted common share. This compares to net income of $455 thousand, equivalent to $0.12 per diluted common share, during the second quarter of 2014. Net income for the first quarter of 2015 (the immediately preceding quarter) was $701 thousand, equivalent to $0.18 per diluted common share.
The rise in net income from the second quarter of 2014 to the second quarter of 2015 primarily resulted from: a larger average balance of interest earning assets; a special cash dividend of $74 thousand from the Federal Home Loan Bank of San Francisco (FHLBSF); the absence of a provision for loan losses; and) a favorable $29 thousand tax settlement with the California Franchise Tax Board (FTB).
The reduction in net income from the first quarter of 2015 to the second quarter of 2015 primarily resulted from the first quarter’s recognition of $249 thousand in tax-free Bank Owned Life Insurance (BOLI) benefits.
Net income for the first six months of 2015 was $1.3 million, equivalent to $0.34 per diluted common share, compared to net income of $863 thousand, equivalent to $0.23 per diluted common share, for the first six months of 2014.
The improved earnings during 2015 primarilyresulted from an increase in net interest income plus the aforementioned BOLI death benefits and FTB tax settlement. These factors were partially offset by a rise in non-interest expense.
The board declared a 50% stock dividend on the Bank’s common stock outstanding. The stock dividend is payable on September 30, 2015 to shareholders of record on September 9, 2015. The dividend will be issued in the form of additional shares of common stock.
Cash will be issued in lieu of fractional shares. This is the Bank’s third stock dividend, following a 2.00% stock dividend that was paid in April 2012 and a 5.00% stock dividend that was paid in June 2014. ■