EX-99.1 2 ydknq12014pressrelease.htm EXHIBIT 99.1 YDKN Q1 2014 Press Release





Yadkin Financial Corporation Announces First Quarter 2014 Results, Highlights Strength of Core Banking Activities


First Quarter Highlights:

Net income available to common shareholders excluding merger-related expenses for the first quarter of 2014 was $4.6 million, or $0.32 per diluted share. Net income available to common shareholders was $3.3 million, or $0.23 per diluted share.
The Company incurred merger-related expenses in the first quarter in association with our pending merger with VantageSouth of $1.4 million or $0.09 per diluted share.
The average net interest margin for the quarter was 4.11%, an increase of 7 basis points compared to the prior quarter.
Total loan balances increased $24.0 million, or 1.8%, compared to the prior quarter, our fourth consecutive quarter of loan growth.
Nonperforming assets decreased for the fifth consecutive quarter, ending the quarter at 0.99% of total assets.
Net charge-offs totaled $1.1 million, or 0.32% of average loans on an annualized basis, for the first quarter of 2014.

Elkin, NC - April 24, 2014 - Yadkin Financial Corporation (NASDAQ: YDKN), the holding company for Yadkin Bank, announced today financial results for the first quarter ended March 31, 2014. Net income available to common shareholders excluding merger-related expenses for the quarter was $4.6 million, or $0.32 per share. Net income available to common shareholders for the quarter was $3.3 million, or $0.23 per diluted share, compared to $4.2 million, or $0.30 per diluted share, for the fourth quarter of 2013, and $4.2 million, or $0.30 per diluted share, for the first quarter of 2013.

Joe Towell, President and CEO of Yadkin Financial Corporation, commented, "We are pleased with our results for the first quarter of 2014 and are particularly proud of our net interest margin, which is increasing due to the strong performance of our core bank. Our net interest margin expanded to 4.11% this quarter as a result of commercial and consumer loan growth, a decrease in our cost of deposits, and increasing yield in our securities portfolio. Furthermore, our asset quality continues to improve, as our nonperforming assets to total assets ratio was 0.99% at the end of the first quarter.

We continue to execute on our organic loan growth strategy and capitalize on increasing loan demand in our markets. Loan balances increased for the fourth consecutive quarter, and are up 1.8% over the prior quarter. Additionally, we are excited about the response from our recent launch of the Business Express loan program for small business customers. This expedited loan platform streamlines the paperwork and approval process so that qualified customers can receive loan decisions quickly and efficiently. Small businesses are at the core of our community banking strategy, and we believe this program allows us to serve them in even better ways.

We are working diligently through the integration process in our pending merger with VantageSouth. We have been encouraged to see the success of our teams working together, as we target closing the merger in the third quarter of 2014. Our strategic focus in this merger process is to create the least amount of disruption for customers on both sides





while working to create an efficient community bank with a robust set of products and services. We will continue to provide updates on our progress in the coming quarters."

First Quarter 2014 Financial Highlights

Asset Quality

Yadkin Bank's key asset quality metrics continue to be strong as we maintain our focus on quality lending, underwriting, and problem asset resolution. First, our adversely classified assets to Tier 1 capital and loan loss reserve ratio has continued to exceed expectations, down to 17.01% at the end of the first quarter. Our nonperforming loans were down slightly compared to the prior quarter, totaling $15.1 million at March 31, 2014. In addition, the nonperforming loans to total loans ratio decreased to 1.09% at March 31, 2014, compared to 1.12% at December 31, 2013.
 

 
 
Nonperforming Loan Analysis
 
 
(Dollars in thousands)
 
 
March 31, 2014
 
December 31, 2013
Loan Type
 
Outstanding Balance
% of Total Loans
 
Outstanding Balance
% of Total Loans
Construction/land development
 
$
1,595

0.12
%
 
$
1,742

0.13
%
Residential construction
 
586

0.04
%
 
589

0.04
%
HELOC
 
904

0.07
%
 
1,285

0.09
%
1-4 family residential
 
2,682

0.19
%
 
2,734

0.20
%
Commercial real estate
 
7,797

0.56
%
 
6,479

0.47
%
Commercial & industrial
 
1,245

0.09
%
 
2,306

0.17
%
Consumer & other
 
272

0.02
%
 
258

0.02
%
Total
 
$
15,081

1.09
%
 
$
15,393

1.12
%

Other real estate owned (OREO) totaled $2.8 million at March 31, 2014, a decrease of $400,000 compared to December 31, 2013. Total nonperforming assets at March 31, 2014 were $17.9 million, or 0.99% of total assets, a decrease of $750,000 from December 31, 2013. In addition, total net charge-offs for the first quarter of 2014 were $1.1 million, or 0.32% of average loans on an annualized basis.

During the first quarter of 2014, the recovery of loan losses was $460,000, which combined with the net charge-offs noted above, resulted in a $1.5 million decrease in the allowance for loan losses as compared to the prior quarter. Following the accelerated asset disposition plan, credit quality has continued to improve, leading to a decrease in the allowance which was prudent given the risk profile of the Company's balance sheet. Management continues to focus on the allowance to ensure that adequate coverage is maintained.

At March 31, 2014, the allowance for loan losses was $16.5 million, compared to $18.1 million at December 31, 2013. As a percentage of total loans held-for-investment, the allowance for loan losses was 1.19% in the first quarter of 2014, down from 1.33% in the fourth quarter of 2013. Out of the $16.5 million in total allowance for loan losses at March 31, 2014, the specific allowance for impaired loans accounted for $690,000, up from $557,000 in the fourth quarter. The remaining general allowance of $15.8 million attributed to unimpaired loans was down from $17.5 million at the end of the fourth quarter.

Net Interest Income and Net Interest Margin

Net interest income after provision decreased by $2.7 million to $17.1 million for the quarter. In the prior quarter, the Company recorded a $3.0 million provision reversal, which positively impacted our net interest income after provision. In the first quarter of 2014, we recorded $460,000 in provision reversal, leading to the decrease in net interest income





after provision. Our net interest margin continued to expand with the quarterly average margin increasing 7 basis points to 4.11%, up from 4.04% at December 31, 2013.

In the first quarter of 2014, our core deposits increased by $31.0 million, and core deposits now represent 65.0% of total deposits. As a result of this strategy, our cost of deposits decreased to 0.45% for the quarter as compared to 0.46% in the fourth quarter of 2013.

Non-Interest Income

Non-interest income increased $3.5 million to $4.7 million in the first quarter compared to $1.2 million in the fourth quarter of 2013. This increase is due primarily to a gain on sale of securities recognized during the quarter, as management made a strategic decision to redeploy the cash from this gain on sale to our lending activities.

Non-Interest Expense

Non-interest expense increased $1.5 million during the first quarter, to $15.2 million as compared to $13.7 million in the fourth quarter. This increase is primarily the result of $1.4 million in merger-related expenses recorded during the first quarter of 2014.

Balance Sheet and Capital

Total assets increased $7.5 million during the first quarter of 2014, due primarily to our continued loan growth, offset by the decrease in our securities portfolio.

The Company's capital ratios have strengthened and continue to exceed all regulatory requirements. As of March 31, 2014, the Bank’s leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio were 11.7%, 13.7%, and 14.8%, respectively. Leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio were 11.9%, 13.9%, and 15.0% respectively, for the holding company as of March 31, 2014. In addition, the Company's tangible common equity to total tangible assets ratio was 8.8% at the end of the first quarter, compared to 8.5% at December 31, 2013. For capital adequacy purposes, leverage ratio, Tier 1 risk-based capital ratio, and total risk-based capital ratio must be in excess of 5.0%, 6.0%, and 10.0%, respectively, to be considered well-capitalized.

Conference Call

Yadkin Financial Corporation will host a conference call at 10:00 a.m. EST on Thursday, April 24, 2014 to discuss financial results, business highlights, and outlook. The call may be accessed by dialing 877-312-5527 at least 10 minutes prior to the call. A webcast of the call audio may be accessed at http://www.media-server.com/m/p/58beuukr. A replay of the call will be available until April 30, 2014
by dialing 855-859-2056 or 404-537-3406 and entering Conference ID 28304860.

####


About Yadkin Financial Corporation
Yadkin Financial Corporation is the holding company for Yadkin Bank, a full-service community bank with 33 branches throughout its two regions in North Carolina and South Carolina. The Western Region serves Avery, Watauga, Ashe, Surry, Wilkes, Yadkin, Durham, and Orange Counties. The Southern Region serves Iredell, Mecklenburg, and Union Counties in North Carolina, and Cherokee and York Counties in South Carolina. The Bank provides mortgage-lending services through its mortgage division, Yadkin Mortgage, headquartered in Greensboro, NC. Securities brokerage services are provided by Yadkin Wealth, Inc., a Bank subsidiary with offices located throughout the branch network. Yadkin Financial Corporation’s website is www.yadkinbank.com. Yadkin shares are traded on NASDAQ under the symbol YDKN.










SAFE HARBOR

This news release contains forward-looking statements, as defined by Federal Securities Laws, including statements about financial outlook and business environment. Forward looking statements generally include words such as “expects,” “projects,” “anticipates,” “believes,” “intends,” “estimates,” “strategy,” “plan,” “potential,” “possible” and other similar expressions.  These statements are provided to assist in the understanding of future financial performance and such performance involves risks and uncertainties that may cause actual results to differ materially from those anticipated in such statements. Any such statements are based on current expectations and involve a number of risks and uncertainties.  For a discussion of some factors that may cause such forward-looking statements to differ materially from actual results, please refer to the section entitled “Forward Looking Statements” on pages 1-2 of Yadkin Financial Corporation’s annual report filed on Form 10-K with the SEC for the year ended December 31, 2013, and in the section entitled "Risk Factors" in the annual report filed on Form 10-K for the year ended December 31, 2013.  Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.







For additional information contact:

Joseph H. Towell
President and Chief Executive Officer
(704) 768-1133
joe.towell@yadkinbank.com

Jan H. Hollar
Executive Vice President and Chief Financial Officer
(704) 768-1161
jan.hollar@yadkinbank.com








 Yadkin Financial Corporation
 
 
 
 
 
 
 
 
 
 Consolidated Balance Sheets (Unaudited)
 
 
 
 
 
 
 
 
 
 
 (Amounts in thousands except share and per share data)
 
March 31, 2014
 
December 31, 2013 (a)
 
September 30, 2013
 
June 30, 2013
 
March 31, 2013
 Assets:
 
 
 
 
 
 
 
 
 
 Cash and due from banks
$
32,254

 
$
32,226

 
$
32,417

 
$
28,104

 
$
22,210

 Federal funds sold
15

 
10

 
15

 
50

 
50

 Interest-earning deposits with banks
29,249

 
8,759

 
6,695

 
4,654

 
20,447

 
 
 
 
 
 
 
 
 
 
 U.S. government agencies
16,324

 
16,392

 
16,536

 
16,625

 
17,232

 Mortgage-backed securities
165,519

 
170,674

 
199,492

 
203,173

 
248,030

 State and municipal securities
82,178

 
98,704

 
109,626

 
110,410

 
115,435

 Common and preferred stocks
3,072

 
3,152

 
3,036

 
137

 
149

Total investment securities
267,093

 
288,922

 
328,690

 
330,345

 
380,846

 
 
 
 
 
 
 
 
 
 
 Construction loans
124,946

 
131,035

 
128,951

 
127,564

 
133,200

 Commercial, financial and other loans
197,109

 
206,833

 
191,874

 
186,965

 
182,268

 Residential mortgages
180,106

 
174,072

 
171,747

 
167,784

 
166,565

 Commercial real estate loans
655,190

 
621,405

 
616,116

 
604,667

 
596,790

 Installment loans
32,546

 
31,256

 
31,450

 
32,133

 
32,037

 Revolving 1-4 family loans
192,801

 
194,145

 
193,299

 
195,648

 
193,404

Total loans
1,382,698

 
1,358,746

 
1,333,437

 
1,314,761

 
1,304,264

 Allowance for loan losses
(16,522
)
 
(18,063
)
 
(21,014
)
 
(22,924
)
 
(24,492
)
Net loans
1,366,176

 
1,340,683

 
1,312,423

 
1,291,837

 
1,279,772

 Loans held for sale
6,962

 
18,913

 
12,632

 
22,545

 
18,461

 Accrued interest receivable
5,915

 
6,219

 
6,339

 
6,546

 
6,502

 Bank premises and equipment
40,396

 
40,698

 
41,050

 
42,410

 
42,454

 Foreclosed real estate
2,828

 
3,267

 
2,989

 
3,812

 
5,449

 Non-marketable equity securities at cost
2,789

 
3,473

 
5,273

 
3,473

 
3,474

 Investment in bank-owned life insurance
27,169

 
27,032

 
26,888

 
26,736

 
26,587

 Core deposit intangible
1,818

 
1,974

 
2,133

 
2,301

 
2,475

 Other assets
30,823

 
33,851

 
35,973

 
39,102

 
37,865

Total assets
$
1,813,487

 
$
1,806,027

 
$
1,813,517

 
$
1,801,915

 
$
1,846,592

 
 
 
 
 
 
 
 
 
 
 Liabilities and shareholders' equity:
 
 
 
 
 
 
 
 
 
 Deposits:
 
 
 
 
 
 
 
 
 
   Non-interest bearing
$
287,585

 
$
267,596

 
$
266,951

 
$
252,618

 
$
257,388

   NOW, savings and money market accounts
704,581

 
693,558

 
676,502

 
686,438

 
656,524

   Time certificates:
 
 
 
 
 
 
 
 
 
   $100 or more
218,273

 
227,919

 
236,787

 
251,168

 
281,652

   Other
315,035

 
329,350

 
311,096

 
332,873

 
366,095

Total deposits
1,525,474

 
1,518,423

 
1,491,336

 
1,523,097

 
1,561,659

 
 
 
 
 
 
 
 
 
 
 Borrowings
90,039

 
89,214

 
131,080

 
91,896

 
99,160

 Accrued expenses and other liabilities
9,198

 
13,920

 
12,229

 
12,306

 
10,922

Total liabilities
1,624,711

 
1,621,557

 
1,634,645

 
1,627,299

 
1,671,741

 
 
 
 
 
 
 
 
 
 
 Total shareholders' equity
188,776

 
184,470

 
178,872

 
174,616

 
174,851

 Total liabilities and shareholders' equity
$
1,813,487

 
$
1,806,027

 
$
1,813,517

 
$
1,801,915

 
$
1,846,592

 
 
 
 
 
 
 
 
 
 
 Period end shares outstanding
14,380,673

 
14,383,986

 
14,383,986

 
14,383,986

 
14,383,884


(a) Derived from audited consolidated financial statements






 Yadkin Financial Corporation
 
 
 
 
 
 
 
 
 
 Consolidated Income Statements (Unaudited)
 
 
 
 
 
 
 
 
 
 
 Three Months Ended
 
 (Amounts in thousands except share and per share data)
 
March 31, 2014
 
December 31, 2013
 
September 30, 2013
 
June 30, 2013
 
March 31, 2013
 
 
 
 
 
 
 
 
 
 
 Interest and fees on loans
$
16,937

 
$
17,126

 
$
16,849

 
$
16,950

 
$
16,679

 Interest on securities
1,719

 
1,773

 
1,616

 
1,686

 
1,548

 Interest on federal funds sold
1

 
1

 

 
3

 
6

 Interest-bearing deposits
9

 
3

 
5

 
12

 
42

     Total interest income
18,666

 
18,903

 
18,470

 
18,651

 
18,275

 Time deposits of $100 or more
845

 
803

 
877

 
1,009

 
1,352

 Other deposits
824

 
929

 
1,034

 
1,112

 
1,432

 Borrowed funds
394

 
422

 
423

 
409

 
439

     Total interest expense
2,063

 
2,154

 
2,334

 
2,530

 
3,223

Net interest income
16,603

 
16,749

 
16,136

 
16,121

 
15,052

 Provision for (recovery of) loan losses
(460
)
 
(3,017
)
 
40

 
55

 
237

Net interest income after provision for (recovery of) loan losses
17,063

 
19,766

 
16,096

 
16,066

 
14,815

Non-interest income:
 
 
 
 
 
 
 
 
 
 Service charges on deposit accounts
1,224

 
1,264

 
1,336

 
1,317

 
1,269

 Other service fees
1,025

 
1,066

 
1,259

 
1,401

 
927

 Income on investment in bank owned life insurance
137

 
145

 
152

 
150

 
153

 Mortgage banking activities
1,022

 
1,162

 
1,713

 
2,546

 
3,288

 Gain (loss) on sale of securities
1,128

 
(2,884
)
 
253

 
272

 
4

 Other than temporary impairment of investments

 

 

 

 
(39
)
Gain on sale of loans

 
202

 

 

 

 Gain on sale of branch

 

 
310

 

 

 Other
161

 
227

 
358

 
498

 
55

      Total non-interest income
4,697

 
1,182

 
5,381

 
6,184

 
5,657

Non-interest expense:
 
 
 
 
 
 
 
 
 
 Salaries and employee benefits
7,917

 
7,854

 
7,780

 
7,953

 
7,389

 Occupancy and equipment
1,746

 
2,049

 
2,001

 
1,951

 
1,815

 Printing and supplies
193

 
151

 
159

 
150

 
163

 Data processing
275

 
376

 
374

 
350

 
395

 Communication expense
380

 
368

 
350

 
338

 
332

 Advertising and marketing
205

 
(322
)
 
348

 
433

 
256

 Amortization of core deposit intangible
156

 
159

 
166

 
175

 
178

 FDIC assessment expense
151

 
433

 
363

 
642

 
592

 Attorney fees
65

 
81

 
90

 
178

 
90

 Other professional fees
344

 
456

 
237

 
497

 
476

 Loan collection expense
97

 
118

 
203

 
201

 
217

 (Gain) loss on fixed assets

 
(12
)
 
154

 

 

 Net cost of operation of other real estate owned
310

 
302

 
93

 
(174
)
 
(822
)
 Merger related expenses
1,352

 

 

 

 

 Other
2,002

 
1,699

 
1,832

 
2,149

 
2,134

      Total non-interest expense
15,193

 
13,712

 
14,150

 
14,843

 
13,215

          Income before income taxes
6,567

 
7,236

 
7,327

 
7,407

 
7,257

Provision for income taxes
2,659

 
2,579

 
2,616

 
2,598

 
2,608

         Net income
3,908

 
4,657

 
4,711

 
4,809

 
4,649

Preferred stock dividend and amortization of preferred stock discount
559

 
421

 
421

 
590

 
445

        Net income available to common shareholders
$
3,349

 
$
4,236

 
$
4,290

 
$
4,219

 
$
4,204






 
 
 
 
 
 
 
 
 
 
Net income per common share (a)
 
 
 
 
 
 
 
 
 
     Basic
$
0.24

 
$
0.30

 
$
0.30

 
$
0.30

 
$
0.30

     Diluted
$
0.23

 
$
0.30

 
$
0.30

 
$
0.30

 
$
0.30

 
 
 
 
 
 
 
 
 
 
  Weighted average number of shares outstanding
 
 
 
 
 
 
 
 
 
     Basic
14,211,456

 
14,206,070

 
14,205,705

 
14,205,223

 
14,198,382

     Diluted
14,269,453

 
14,259,809

 
14,249,152

 
14,223,604

 
14,200,424

 
 
 
 
 
 
 
 
 
 
(a) Net income per share for periods prior to the second quarter of 2013 have been adjusted to reflect the 1-for-3 reverse stock split.







 Yadkin Financial Corporation
 
 
 
 
 
 
 
 
 
(unaudited)
 
 
 
 
 
 
 
 
 
 
At or For the Three Months Ended
 
March 31, 2014
 
December 31, 2013
 
September 30, 2013
 
June 30, 2013
 
March 31, 2013
 
 
 
 
 
 
 
 
 
 
Per Share Data:
 
 
 
 
 
 
 
 
 
Basic Earnings (Loss) per Share (8)
$
0.24

 
$
0.30

 
$
0.30

 
$
0.30

 
$
0.30

Diluted Earnings (Loss) per Share (8)
0.23

 
0.30

 
0.30

 
0.30

 
0.30

Book Value per Share (8)
11.15

 
10.85

 
10.47

 
10.17

 
10.21

 
 
 
 
 
 
 
 
 
 
Selected Performance Ratios:
 
 
 
 
 
 
 
 
 
Return on Average Assets (annualized)
0.76
%
 
0.93
 %
 
0.95
%
 
0.93
%
 
0.91
%
Return on Average Equity (annualized)
7.29
%
 
9.31
 %
 
9.74
%
 
9.63
%
 
9.94
%
Net Interest Margin (annualized)
4.11
%
 
4.04
 %
 
3.93
%
 
3.90
%
 
3.57
%
Net Interest Spread (annualized)
3.97
%
 
3.90
 %
 
3.80
%
 
3.76
%
 
3.40
%
Non-interest Income as a % of Revenue(6)
21.59
%
 
5.64
 %
 
25.05
%
 
27.79
%
 
27.63
%
Non-interest Income as a % of Average Assets
0.26
%
 
0.07
 %
 
0.30
%
 
0.34
%
 
0.30
%
Non-interest Expense as a % of Average Assets
0.85
%
 
0.76
 %
 
0.79
%
 
0.82
%
 
0.70
%
 
 
 
 
 
 
 
 
 
 
Asset Quality:
 
 
 
 
 
 
 
 
 
Loans 30-89 Days Past Due (000's) (4)
$
11,372

 
$
8,702

 
$
4,412

 
$
6,493

 
$
6,060

Loans Over 90 Days Past Due Still Accruing (000's)

 

 

 

 

Nonperforming Loans (000's)
15,082

 
15,393

 
17,874

 
19,698

 
23,712

Other Real Estate Owned (000's)
2,828

 
3,267

 
2,989

 
3,812

 
5,449

Nonperforming Assets (000's)
17,910

 
18,660

 
20,864

 
23,510

 
29,161

Accruing/Performing Troubled Debt Restructurings (000's) (5)
3,444

 
6,287

 
5,599

 
9,162

 
8,579

Nonperforming Loans to Total Loans
1.09
%
 
1.12
 %
 
1.33
%
 
1.47
%
 
1.79
%
Nonperforming Assets to Total Assets
0.99
%
 
1.03
 %
 
1.15
%
 
1.30
%
 
1.58
%
Allowance for Loan Losses to Total Loans
1.19
%
 
1.31
 %
 
1.56
%
 
1.71
%
 
1.85
%
Allowance for Loan Losses to Total Loans Held for Investment
1.19
%
 
1.33
 %
 
1.58
%
 
1.74
%
 
1.88
%
Allowance for Loan Losses to Nonperforming Loans
109.55
%
 
117.34
 %
 
117.57
%
 
116.38
%
 
103.29
%
Net Charge-offs/Recoveries to Average Loans (annualized)
0.32
%
 
(0.02
)%
 
0.58
%
 
0.49
%
 
0.27
%
 
 
 
 
 
 
 
 
 
 
Capital Ratios:
 
 
 
 
 
 
 
 
 
Equity to Total Assets
10.41
%
 
10.22
 %
 
9.86
%
 
9.69
%
 
9.47
%
Tier 1 Leverage Ratio(1)
11.71
%
 
11.24
 %
 
10.88
%
 
10.30
%
 
9.72
%
Tier 1 Risk-based Ratio(1)
13.73
%
 
13.21
 %
 
12.92
%
 
12.49
%
 
12.23
%
Total Risk-based Capital Ratio(1)
14.82
%
 
14.41
 %
 
14.17
%
 
13.74
%
 
13.49
%
 
 
 
 
 
 
 
 
 
 
Non-GAAP Disclosures(2):
 
 
 
 
 
 
 
 
 
Tangible Book Value per Share
$
11.03

 
$
10.71

 
$
10.32

 
$
10.01

 
$
10.03

Return on Tangible Equity (annualized) (3)
7.36
%
 
9.42
 %
 
9.87
%
 
9.76
%
 
10.09
%
Tangible Common Equity to Tangible Assets (3)
8.75
%
 
8.54
 %
 
8.19
%
 
8.00
%
 
7.83
%
Efficiency Ratio (7)
66.14
%
 
62.80
 %
 
63.47
%
 
66.55
%
 
66.39
%
Net income to common shareholders excluding merger costs (9)
$
4,576

 
$
4,236

 
$
4,290

 
$
4,219

 
$
4,204










Notes:
(1)
Tier 1 leverage, Tier 1 risk-based, and Total risk-based ratios are ratios for the bank, Yadkin Bank as reported on Consolidated Reports of Condition and Income for a Bank With Domestic Offices Only - FFIEC 041
(2)
Management uses these non-GAAP financial measures because it believes it is useful for evaluating our operations and performance over periods of time, as well as in managing and evaluating our business and in discussions about our operations and performance. Management believes these non-GAAP financial measures provides users of our financial information with a meaningful measure for assessing our financial results and credit trends, as well as comparison to financial results for prior periods. These non-GAAP financial measures should not be considered as a substitute for operating results determined in accordance with GAAP and may not be comparable to other similarly titled financial measures used by other companies.
(3)
Tangible Common Equity is the difference of shareholders' equity less preferred shares, less the sum of goodwill and core deposit intangible. Tangible Assets are the difference of total assets less the sum of goodwill and core deposit intangible.
(4)
Past due numbers exclude loans classified as nonperforming.
(5)
Nonperforming assets exclude accruing troubled debt restructured loans.
(6)
Ratio is calculated by taking non-interest income as a percentage of net interest income after provision for loan losses plus total non-interest income.
(7)
Efficiency ratio is calculated by taking non-interest expense less the amortization of intangibles and gains on sale of OREO, as a percentage of total taxable equivalent net interest income and non-interest income less gains on sale of securities, gains (losses) on sale of loans, gains on sale of branch and other than temporary impairment of investments.
(8)
Per share amounts for periods prior to the second quarter of 2013 have been adjusted to reflect the 1-for-3 reverse stock split.
(9)
Net income to common shareholders excluding merger costs was calculated by adding back $1,352 in merger expenses, less a $125 adjustment for taxes for the three months ended March 31, 2014.











Yadkin Financial Corporation
 
 
 
 
 
 
 
Average Balance Sheets and Net Interest Income Analysis (Unaudited)
 
 
 
 
 
 
 
 
Three Months Ended March 31,
 
 
2014
 
2013
 
 
(Dollars in Thousands)
 
 
Average
 
 
 
Yield/
 
Average
 
 
 
Yield/
 
 
Balance
 
Interest
 
Rate
 
Balance
 
Interest
 
Rate
 
INTEREST EARNING ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
Total loans (1,2)
$
1,371,694

 
$
16,966

 
5.02
%
 
$
1,321,253

 
$
16,708

 
5.13
%
 
Investment securities
286,094

 
2,046

 
2.90
%
 
364,453

 
1,838

 
2.05
%
 
Interest-bearing deposits & federal funds sold
16,794

 
10

 
0.24
%
 
62,707

 
48

 
0.31
%
 
Total average earning assets (1)
1,674,582

 
19,022

 
4.61
%
(6)
1,748,413

 
18,594

 
4.31
%
(6)
Non-interest earning assets
122,754

 
 
 
 
 
128,610

 
 
 
 
 
Total average assets
$
1,797,336

 
 
 
 
 
$
1,877,023

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
INTEREST BEARING LIABILITIES
 
 
 
 
 
 
 
 
 
 
 
 
Time deposits
$
548,673

 
$
1,376

 
1.02
%
 
$
693,150

 
$
2,510

 
1.47
%
 
Other deposits
685,356

 
293

 
0.17
%
 
638,377

 
274

 
0.17
%
 
Borrowed funds
89,624

 
394

 
1.78
%
 
101,763

 
439

 
1.75
%
 
Total interest bearing liabilities
1,323,653

 
2,063

 
0.63
%
(7)
1,433,290

 
3,223

 
0.91
%
(7)
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-interest bearing deposits
276,878

 
 
 
 
 
259,883

 
 
 
 
 
Other liabilities
10,459

 
 
 
 
 
12,307

 
 
 
 
 
Total average liabilities
1,610,990

 
 
 
 
 
1,705,480

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Shareholders' equity
186,346

 
 
 
 
 
171,543

 
 
 
 
 
Total average liabilities and
 
 
 
 
 
 
 
 
 
 
 
 
   shareholders' equity
$
1,797,336

 
 
 
 
 
$
1,877,023

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NET INTEREST INCOME/
 
 
 
 
 
 
 
 
 
 
 
 
    YIELD (3,4)
 
 
$
16,959

 
4.11
%
 
 
 
$
15,371

 
3.57
%
 
INTEREST SPREAD (5)
 
 
 
 
3.97
%
 
 
 
 
 
3.40
%
 


(1)
Yields related to securities and loans exempt from Federal income taxes are stated on a fully tax-equivalent basis, assuming a Federal income tax rate of 35%, reduced by the nondeductible portion of interest expense.
(2)
The loan average includes loans on which accrual of interest has been discontinued.
(3)
Net interest income is the difference between income from earning assets and interest expense.
(4)
Net interest yield is net interest income divided by total average earning assets.
(5)
Interest spread is the difference between the average interest rate received on earning assets and the average rate paid on interest bearing liabilities.
(6)
Interest income for 2014 and 2013 includes $57,000 and $45,000, respectively, of accretion for purchase accounting adjustments related to loans acquired in the merger with American Community.
(7)
Interest expense for 2014 and 2013 includes $9,000 of accretion for purchase accounting adjustments related to deposits and borrowings acquired in the merger with American Community.