PARENT COMPANY ONLY FINANCIAL STATEMENTS

12 Months Ended

Dec. 31, 2013

PARENT COMPANY ONLY FINANCIAL STATEMENTS

PARENT COMPANY ONLY FINANCIAL STATEMENTS

NOTE 19—PARENT COMPANY ONLY FINANCIAL STATEMENTS

BALANCE SHEETS

December 31, 2013 and 2012

(Dollars in Thousands)

	2013		2012
ASSETS
Cash and cash equivalents	$	1,301	$	12,943
Investment in subsidiaries		65,881		59,854
Other assets		567		117
TOTAL ASSETS	$	67,749	$	72,914
LIABILITIES AND SHAREHOLDERS' EQUITY
Line of Credit	$	2,000	$	—
Other liabilities		500		466
Total liabilities		2,500		466
Shareholders' equity:
Preferred stock—no par value:
Authorized 500,000 shares, 11,000 shares issued and outstanding		—		11,000
Common stock and additional paid in capital—no par value
Authorized 18,000,000 shares
Issued and outstanding—5,541,390 and 5,559,859 shares respectively		53,621		53,797
Retained earnings		11,412		6,727
Accumulated other comprehensive income		216		924
Total shareholders' equity		65,249		72,448
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	67,749	$	72,914

STATEMENTS OF OPERATIONS

Years Ended December 31, 2013, 2012, and 2011

(Dollars in Thousands)

	2013			2012			2011
INCOME:
Interest income	$	1		$	3		$	3
Total income	$	1		$	3		$	3
EXPENSES:
Salaries and benefits		482			280			180
Professional service fees		208			562			245
Other		520			340			223
Total expenses		1,210			1,182			648
Loss before income taxes and equity in undistributed net income (loss) of subsidiaries		(1,209	)		(1,179	)		(645	)
Provision for (benefit of) income taxes		(411	)		(393	)		(211	)
Loss before equity in undistributed net income of subsidiaries		(798	)		(786	)		(434	)
Equity in undistributed net income of subsidiaries		6,735			7,873			2,652
Net income		5,937			7,087			2,218
Preferred dividend and accretion of discount		308			629			766
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$	5,629		$	6,458		$	1,452

STATEMENTS OF CASH FLOWS

Years Ended December 31, 2013, 2012, and 2011

(Dollars in Thousands)

	2013			2012			2011
Cash Flows from Operating Activities:
Net income	$	5,937		$	7,087		$	2,218
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed net (income) of subsidiaries		(6,735	)		(7,873	)		(2,652	)
Increase in capital from stock compensation		333			66			—
Change in other assets		2,587			92			29
Change in other liabilities		1,997			(163	)		(97	)
Net cash provided by (used in) operating activities		4,119			(791	)		(502	)
Cash Flows from Investing Activities:
Investments in subsidiaries		(3,000	)		—			—
Cash Flows from Financing Activities:
Proceeds from issuance of common stock		—			11,506			—
Repurchase of common stock		(509	)		—			—
Purchase of common stock warrants		—			(1,300	)		—
Dividend on common stock		(944	)		(223	)		—
Dividend on preferred stock		(308	)		(550	)		(551	)
Redemption of Series A Preferred Stock		(11,000	)		—			—
Net cash provided by (used in) financing activities		(12,761	)		9,433			(551	)
Net increase (decrease) in cash and cash equivalents		(11,642	)		8,642			(1,053	)
Cash and cash equivalents at beginning of period		12,943			4,301			5,354
Cash and cash equivalents at end of period	$	1,301		$	12,943		$	4,301