HIGH POINT, N.C., April 30, 2012/PRNewswire/ -- BNC Bancorp (NASDAQ: BNCN) ("Company"), parent company for Bank of North Carolina("Bank"), today reported financial results for the first quarter ended March 31, 2012.

For the quarter ended March 31, 2012, net income available to common shareholders, excluding one-time deal related expenses, was $1.9 million, or $0.18per diluted share, an increase of 108% compared to the $917,000, or $0.09per diluted share, reported for the first quarter in 2011.  In the first quarter of 2012, the Company incurred $1.2 millionof one-time expenses associated with merger and acquisition activities, which reduced after-tax diluted earnings per share by $0.07.   

For the quarter ended March 31, 2012, net income totaled $1.7 millioncompared to $1.5 millionfor the quarter ended March 31, 2011. After dividends and accretion on preferred stock, the Company reported net income available to common shareholders of $1.1 million, or $0.11per diluted share, for the current quarter, compared to $917,000, or $0.09per diluted share, for the quarter ended March 31, 2011.

Total assets at March 31, 2012were $2.41 billion, an increase of $251.6 million, or 11.7%, compared to $2.16 billionat March 31, 2011.  The increase was due to strong organic growth in our North Carolinafranchise, along with the acquisition and integration of Blue Ridge Saving Bank ("Blue Ridge") and Regent Bank of South Carolina("Regent") during this period.

W. Swope Montgomery, Jr., President and CEO, noted, "We are proud of the earnings and growth momentum that we have created in our Company.  Over the past two years we have either closed or announced four acquisitions, and coupled with our strong organic growth, have strategically expanded our footprint into five new growth markets in the Carolinas:  Charlotte, Raleigh-Durham, and Ashevillein North Carolinaand Greenvilleand the Grand Strand of South Carolina.   We have proven that we can complete FDIC failed bank transactions, negotiate and integrate whole bank acquisitions, and attract seasoned teams to drive organic growth.  As we have expanded we have built regional credit and management teams, invested in corporate credit oversight, and more recently in the enterprise risk management areas. 

While the investment in regional markets and corporate support creates a burden on earnings in the short-term, we are focused on leveraging this investment with further in-market expansion to gain greater market penetration and achieve higher returns on incremental growth.  This focus is further evidenced by us recently opening another office in Charlotte, and hiring a seasoned team to open an office for us in Cary, North Carolina, located within the Raleigh-Durhammarket.  With our strategic vision of well-balanced growth in attractive banking markets we believe we are creating an attractive footprint and valuable franchise that will drive shareholder value, especially given the long-term growth and demographic trends in the Carolinas."   

Highlights for Quarter ended March 31, 2012:

  • Net income available to common shareholders increased to $0.18*per share, compared to $0.09in Q1 of 2011, and $0.15*in Q4 of 2011 (*excludes one-time merger related costs of $0.07per share in both quarters).
  • Net interest income (FTE) increased to $20.0 million, an increase of $1.9 million, or 10.2% compared to year ago levels.
  • Net interest margin, GAAP basis, declined 7 basis points to 3.80% compared to 3.87% for Q1 2011. 
  • Core net interest margin, excluding certain fair value accretion above normal levels, remained stable at 3.75%, compared to 3.76% in Q4 2011 and 3.79% in Q3 2011.
  • Total loans increased $9.8 millionduring the current quarter - an annualized rate of growth of 2.3%.
    • Non-covered portfolio loans increased $28.5 million- an annualized rate of growth of 8.3%.
  • Successfully converted core systems at both Blue Ridgeand Regent during the current quarter.
  • Opened second office in Charlotte,  located on Carmel Road near the intersection of Pineville-Mathews Road.
  • Hired new leadership for our Ashevilleoperations and also purchased a more visible and customer-friendly branch office where we will relocate Ashevillebanking operations.
  • Hired a seasoned and high-performing team to open an office in Cary, North Carolina, further expanding our presence in the growing Raleigh-Durhammarket.
  • Mortgage division closed over $60 millionin new loan originations during the quarter, resulting in income and fees of over $1.2 million.
  • Noncovered NPAs and TDRs declined from $81.9 million to $72.4 million.
  • Loan pipeline remains strong in each of our newer markets. 

Montgomery continued, "While the highlights outlined above are just a sampling of the many positive steps being achieved by our Company on a quarterly basis, it is also important to constantly evaluate the progress we have made over the past several years. While our stock price does not, in my opinion, reflect the value we are creating in our Company, it is important to note the tremendous progress being made for our shareholders during arguably the worst economic period in recent history.  I would welcome any of our shareholders to compare the highlights below with any of our peers in North Carolina."

Highlights: 2007 to Current

  • Total assets have increased from $1.1 billionto $2.4 billion.
  • Total branch offices have increased from 16 to 31.
  • Expanded into the three highest growth markets in the Carolinas: Charlotte, Raleigh-Durham, and Greenville, South Carolina.
  • Annualized net interest income (FTE) has increased from $34.1 millionto $80.0 million.
  • Core earnings power(1) has increased from $15.3 millionto over $38.4 million.
  • Tangible book value has increased from $8.02to $9.75.
  • Currently the 5th largest bank headquartered in North Carolina.
  • Only Bank in the southeast to announce at least 2 FDIC transactions and 2 whole bank transactions since 2009.
  • Assembled mortgage origination division on pace for $250 millionin annual originations.
  • Reported positive earnings every year during this challenging period.

(1) Core earnings power:Pre-tax income (FTE) + OREO Valuation Adjustments + Provision for loan losses + collection and management costs of nonperforming assets (NPAs) + lost income on NPAs - gains on securities and FDIC acquisitions.

"While elevated credit costs due to a soft economy in the Carolinas continue to weigh down earnings per share, our identification and workout efforts continue to move forward with the highest priority.  With the local and national economies yet to produce signs of a robust recovery, we remain cautious about how quickly our credit costs can improve on a nominal basis.  Total costs of provision and OREO valuation adjustments declined to $26.7 millionin 2011 from $31.7 millionin 2010.  Current year costs are on pace to decline below 2011 levels, but still above normalized levels indicative of a healthy local economy.    The trends are encouraging, and as we grow the balance sheet with acquired loan portfolios discounted at closing for credit and yield marks under fair value accounting, the pre-2009 legacy portfolio becomes a smaller percentage of the balance sheet and these nominal credit costs become a smaller percentage of total revenue and expense." 

"In summary, the past four years have been very difficult for our industry, and without question the most challenging in my forty year banking career.  Many of our peers in the Carolinas have either ceased to exist, or retrenched to levels well below their pre-2008 stature.  We have been fortunate to have the resources, the people, the ingenuity, and the grit to tackle both the challenges and the opportunities head-on over this period.   The results of the first quarter are just another in a long series where we made significant progress in executing our strategic plan to be the community bank of choice in the Carolinas."

Additional Operating Highlights from First Quarter

Since March 2011, total loans increased $195.9 million, or 12.8%, while non-covered loans increased by $190.2 million, or 15.5%.  At March 31, 2012, the Company's loan portfolio included $307.1 millionin loans covered under loss-share agreements and $1.42 billionof non-covered loans.  During the fourth quarter of 2011, the Company's acquisitions of Blue Ridgeand Regent Bank increased loans covered under loss-share agreements by $65.6 millionand loans not covered by loss-share agreements by $31.7 million, respectively.  Loans acquired from Beach First, Blue Ridgeand Regent are accounted for under fair value and shown net of any related credit and yield adjustments, from acquisition date. 


Gross Loan Growth


(dollars in thousands; unaudited)












3/31/2012


12/31/2011


9/30/2011


6/30/2011


3/31/2011

Total loans

$ 1,724,626


$ 1,709,483


$ 1,572,566


$ 1,528,547


$ 1,528,727

Loans covered by loss-share, at fair value

307,097


320,033


262,673


283,685


301,436

Loans not covered by loss-share

$ 1,417,529


$ 1,389,450


$ 1,309,893


$ 1,244,862


$ 1,227,291











Loan growth (quarter/quarter):










Total loans

0.9%


8.7%


2.9%


0.0%


1.4%

Loans not covered by loss-share

2.0%


6.1%


5.2%


1.4%


2.4%

Annual growth of non-covered loans

15.5%



















OREO at March 31, 2012totaled $68.8 million, an increase of $31.3 millionfrom March 31, 2011.  This increase is associated with the fourth quarter 2011 acquisition of Blue Ridge, having acquired $30.1 millionof OREO covered under loss-share agreements.  At March 31, 2012, the Company's non-covered OREO portfolio totaled $25.2 million.

At March 31, 2012, the carrying value of loans and OREO covered by loss-share agreements was $307.1 millionand $43.6 million, respectively, with a corresponding indemnification receivable from the FDIC of $73.5 million. 

Total deposits at March 31, 2012were $2.12 billion, an increase of $245.6 millionfrom March 31, 2011, primarily from the $204.0 millionof deposits assumed from our fourth quarter 2011 acquisitions.  While overall deposit growth continues to be an emphasis, more important is the increase in transactional account deposits.  Over the one-year period, transactional accounts, which are comprised of non-interest bearing and interest-bearing demand accounts, increased $154.0 million, or 15.9%.  At March 31, 2012, time deposits were 47.1% of total deposits, compared to 48.4% and 50.2% at March 31, 2011and December 31, 2011, respectively. 


Total Deposit Growth


(dollars in thousands; unaudited)












3/31/2012


12/31/2011


9/30/2011


6/30/2011


3/31/2011

Non-interest bearing demand

$      162,857


$      145,688


$      130,978


$      128,694


$      116,286

Interest-bearing demand

956,784


909,402


833,190


835,967


849,392

Time deposits

996,831


1,063,097


871,436


885,922


905,173

Total

$   2,116,472


$   2,118,187


$   1,835,604


$   1,850,583


$   1,870,851











Deposit growth (quarter/quarter)

-0.1%


15.4%


-0.8%


-1.1%


2.3%











Operating Results

Net interest income for the first quarter of 2012 was $18.6 million, an increase of $1.9 millionfrom the comparable period last year, and a decrease of $1.5 millionfrom the prior quarter.  Fourth quarter 2011 net interest income was impacted by a significant increase in the accretion of yield and fair value discounts on the acquired loan portfolios.  Taxable-equivalent net interest margin decreased by 7 basis points from the first quarter of 2011 to 3.80%.  Compared to the fourth quarter of 2011, taxable-equivalent net interest margin decreased 38 basis points from 4.18%.

During the first quarter of 2012, the Company's average yield on interest-earning assets decreased 23 basis points while the cost of average interest-bearing liabilities decreased 17 basis points when compared to the first quarter of 2011.  When compared to the fourth quarter of 2011, the Company's yield on average earning assets decreased by 37 basis points, while the cost of average interest-bearing liabilities increased 2 basis points.

During the first quarter of 2012, accretion totaled $1.5 million, compared to $1.4 millionin the first quarter of 2011, and $3.1 millionin the fourth quarter of 2011.  The additional accretion during the fourth quarter of 2011 was due to accretion on the performing Blue Ridgeloan portfolio, utilizing a level-yield basis over the economic life of the loans, and the adjustment of cash flows on the Beach First loan portfolio.


Quarterly Average Yields / Costs (Tax-Equivalent Basis)


(unaudited)












3/31/2012


12/31/2011


9/30/2011


6/30/2011


3/31/2011

Earning asset yield

5.43%


5.80%


5.48%


5.55%


5.66%

Cost of interest-bearing liabilities

1.64%


1.62%


1.73%


1.73%


1.81%

Cost of funds

1.53%


1.52%


1.62%


1.62%


1.71%

Net interest spread

3.79%


4.18%


3.76%


3.82%


3.85%

Net interest margin

3.80%


4.18%


3.79%


3.84%


3.87%











Non-interest income was $5.8 millionfor the first quarter of 2012 and $12.2 millionfor the fourth quarter of 2011, compared to $2.4 millionfor the prior year first quarter.  Included in non-interest income for the first quarter of 2012 was $1.6 millionof net gains on sales of investment securities, and $1.2 millionof income associated with FDIC receivable and related loss-share receipts.  Excluding the sales of investment securities and the FDIC related income, non-interest income was $3.0 millionfor the current quarter, an increase of 45.2% from the $2.1 millionreported for the first quarter of 2011 and consistent with the $3.0 millionreported in the fourth quarter of 2011.  When compared to the first quarter of 2011, increases were primarily due to increases in mortgage fee income of $754,000.  During the second quarter of 2011, the Company's original mortgage origination platform was terminated and replaced with a more robust platform that increased mortgage origination volume and fee income.  In addition, the Company's SBA division became operational during the third quarter of 2011, with $228,000of SBA fee income recorded during the first quarter of 2012.

In late 2008, the Company entered into a leverage transaction that resulted in investment securities being purchased, with yields in excess of 5%, and Fed Funds based funding being locked in at an effective cost of 2.95% over the five-year period.  Much of this income was used to fund organic expansion in the Charlotteand Raleighmarkets.  As the Company enters the final two years of the transaction term, as planned, the Company is liquidating the purchased investment securities to fund core loan growth in these markets.  During the quarter, the caplet costs associated with the hedged funding transaction was $1.9 million, which is included in interest expense on demand deposits, while the gains on sales of securities associated with the related liquidation of the hedged investment securities totaled $1.6 million.  As the Company continues to liquidate its hedged securities position, it is anticipated that these gains will partially offset the related cap cost over the coming quarters.

Non-interest expense for the first quarter of 2012 increased $3.1 millioncompared to the same quarter a year ago, and was $5.7 millionlower than the fourth quarter of 2011.  Loan, foreclosure and collection expenses decreased by $600,000during the first quarter of 2012 when compared to the same quarter in 2011, primarily from lower valuation adjustments on OREO properties, and were $6.6 millionlower than the fourth quarter of 2011.  During the first quarter of 2012, there was $1.2 millionof additional non-interest expense associated with acquisition and project related costs, including the Blue Ridgeand Regent acquisition.

The Company's personnel costs have increased $2.7 million, or 36.8%, during the first quarter of 2012 when compared to the same quarter a year ago, and were $1.1 millionhigher than the previous quarter.  These increases were mainly due to the additional full time equivalent employees from the fourth quarter 2011 acquisitions, as well as increases in personnel costs are attributable to continued investments in the mortgage originations and SBA lending platforms, and overall franchise growth.  All of these personnel additions are expected to contribute to our long-term focus on driving both top line and fee income growth. 

During the first quarter of 2012, occupancy and equipment expenses increased $622,000when compared to the same quarter a year ago, and were $250,000higher than the previous quarter.  Data processing expenses increased $134,000from the same prior year quarter, and were $84,000higher than the previous quarter.  These increases are associated with the Company's acquisition activity, including the successful systems conversion of both Blue Ridgeand Regent during the first quarter of 2012. 

Professional and other services, and other expenses increased by $349,000and $167,000, respectively, when compared to the same quarter a year ago, primarily from costs associated with our acquisitions and franchise growth.  When compared to the fourth quarter of 2011, professional and other services, and other expenses decreased by $283,000and $245,000, respectively, as the acquisitions during the fourth quarter of 2011 elevated these expenditures.  Specific acquisition related costs for these expense categories totaled $907,000and $723,000for the first quarter of 2012 and fourth quarter of 2011, respectively.  In addition, the Company sold a vacant bank branch during the first quarter of 2012, recording an $183,000loss from the sale.  All other non-interest expense categories have seen nominal increases when compared to the same quarter a year ago.



Non-Interest Income / Non-Interest Expense




(dollars in thousands; unaudited)












Three Months Ended




3/31/2012


12/31/2011


3/31/2011


Non-interest income








Mortgage fees


$             1,116


$             1,044


$                362


Service charges


738


751


827


Investment brokerage fees


240


204


157


Earnings on bank-owned life ins


410


429


425


Gain on sale of securities


1,619


34


57


Gain on acquisition


-


7,800


-


Other


1,686


1,906


597


Total non-interest income


$             5,809


$           12,168


$             2,425










Non-interest expense








Salaries and employee benefits


$             9,901


$             8,796


$             7,239


Occupancy and equipment


2,194


1,944


1,572


Data processing and supply


697


613


563


Advertising/business development


388


481


419


Professional and other services


1,345


1,628


996


FDIC insurance assessments


600


488


810


Loan, foreclosure and collection


1,476


8,105


2,076


Other


1,224


1,469


1,057


Total non-interest expense


$           17,825


$           23,524


$           14,732










Asset Quality

Net charge-offs for the first quarter of 2012 were $5.7 million, which included $2.5 millionof loans covered under loss-share agreements where the Company's cost was $538,000.  Combined with the $3.2 millionof non-covered charge-offs, the Company incurred $3.8 millionin charge-off losses, or 0.89% of average loans annualized compared to $7.0 million, or 1.73% reported for the fourth quarter of 2011.  Nonperforming assets not covered by loss-share were 2.08% of total assets and 6.53% including covered assets at March 31, 2012, compared to 1.93% and 6.57%, respectively, at December 31, 2011.  The covered assets are covered by FDIC loss-share agreements that provide 80% protection on those assets and are being carried at estimated fair value.


Asset Quality Information


(dollars in thousands;  unaudited)












3/31/2012


12/31/2011


9/30/2011


6/30/2011


3/31/2011

Nonaccrual loans not covered by loss-share

$       17,554


$       19,442


$       29,844


$       31,822


$       34,047

Nonaccrual loans covered by loss-share 

70,305


67,854


61,711


62,259


69,377

OREO not covered by loss-share

25,212


20,927


22,736


24,289


21,663

OREO covered by loss-share 

43,603


47,577


22,747


23,348


15,811

90 days past due not covered by loss-share

-


-


-


-


124

90 days past due covered by loss-share

539


5,425


23


-


-

Total nonperforming assets

$     157,213


$     161,225


$     137,061


$     141,718


$     141,022

Nonperforming assets not covered by loss-share

$       42,766


$       40,369


$       52,580


$       56,111


$       55,834











Total assets

$  2,408,890


$  2,454,930


$  2,197,758


$  2,146,745


$  2,157,280

Total assets less covered assets

2,058,190


2,087,321


1,912,338


1,839,712


1,840,033











Total loans

1,724,626


1,709,483


1,572,566


1,528,547


1,528,727

Total accruing loans

1,636,767


1,622,187


1,481,011


1,434,466


1,425,303

Total loans less fair value loans

1,387,455


1,357,717


1,309,893


1,244,862


1,227,291

Total loans less covered loans

1,417,529


1,389,451


1,309,893


1,244,862


1,227,291











Total allowance for loan losses

36,722


31,008


24,177


23,373


24,325

Allowance for loans not covered by loss-share

24,272


23,899


24,177


23,373


24,325

Allowance for loans covered by loss-share

12,450


7,109


-


-


-











Ratio of nonperforming assets to total assets

6.53%


6.57%


6.24%


6.60%


6.54%

Not covered by loss-share 

2.08%


1.93%


2.75%


3.05%


3.03%











Ratio of nonperforming loans to total loans

5.13%


5.42%


5.82%


6.15%


6.77%

Not covered by loss-share 

1.24%


1.40%


2.28%


2.56%


2.78%











Ratio of allowance for loan losses to total loans

2.13%


1.81%


1.54%


1.53%


1.59%

Total loans less fair value loans to allowance not 










covered by loss-share

1.75%


1.76%


1.85%


1.88%


1.98%











Net charge-offs, QTD

$         5,723


$       10,036


$         2,719


$         3,985


$         3,988

Net charge-offs, non-covered portion, QTD (1)

3,779


7,015


2,719


3,985


3,988

Ratio of net charge-offs, non-covered portion, 










QTD to average total loans, annualized (1)

0.89%


1.70%


0.70%


1.04%


1.07%











Loans restructured/modified not included in above,










(not 90 days past due or on nonaccrual)

$       29,617


$       41,516


$       32,294


$       30,036


$       25,857











(1) Non-covered portion represents the Company's non-covered charge-offs and the 20% portion of the charge-offs relating to loans 

covered under loss-share agreements.




























During the first quarter of 2012, the Company recorded a provision for loan losses of $5.2 million, a decrease from the $8.2 millionrecorded during the fourth quarter of 2011.  Of the $5.2 millionin provision expense, $3.6 millionrelated to legacy non-covered loans and $1.6 millionin related loss-share loans.  The Company recorded a $7.8 millionallowance for loan loss provision for loss-share loans, of which $6.3 millionwas recorded through a FDIC indemnification asset and the remaining $1.6 million, representing 20% of the total provision, was recorded through the Company's provision expense.  The allowance for loan losses was $36.7 millionat March 31, 2012, and $31.0 millionat December 31, 2011.  Loan loss reserves to total period-end loans were 2.13% and 1.81% at March 31, 2012and December 31, 2011, respectively, compared to 1.59% reported at March 31, 2011.  Excluding the loans acquired that are marked to fair value, loan loss reserves to period-end loans not covered by loss-share decreased from 1.76% and 1.98%  reported at December 31, 2011and March 31, 2011, respectively, to 1.75% at March 31, 2012. 

Nonaccrual loans not covered by loss-share agreements totaled $17.6 millionat March 31, 2012, a decrease of $1.9 millioncompared to $19.4 millionat December 31, 2011.  Loans migrating into nonaccrual status during the quarter totaled $9.0 million, of which $4.0 millionwere from performing Troubled Debt Restructurings ("TDRs").  Nonaccrual loans covered by loss-share agreements totaled $70.3 million, an increase of $2.4 millioncompared to $67.9 millionat December 31, 2011.  The increase primarily resulted from the additional nonaccrual from the Blue Ridgeacquisition.

TDRs decreased $11.9 millionduring the first quarter of 2012 to $29.6 million, of which $3.0 millionis covered under loss-share.  The decrease in TDRs are associated with performing loans that were removed from TDRs and transferred to nonaccrual loans, and from TDRs that were removed from reporting disclosure due to satisfactory performance and reporting requirements. 

OREO not covered by loss-share agreements totaled $25.2 millionat March 31, 2012, an increase of $4.3 millionfrom the $20.9 millionreported at December 31, 2011.  The change primarily consisted of $5.9 millionin additions at fair value, $155,000in valuation adjustments, and $1.9 millionin sales.

Capital Position

The Company continues to maintain strong capital ratios.  Shareholders' equity was $165.4 millionat March 31, 2012, an increase of $1.5 millionfrom December 31, 2011and an increase from $154.2 millionat March 31, 2011.  Tangible common book value per share was $9.75at March 31, 2012, an increase from $9.60at December 31, 2011and an increase from $8.70at March 31, 2011.  Core tangible book value, which excludes the very volatile mark-to-market component, was $9.58at March 31, 2012, an increase from the $9.49at December 31, 2011.  All of the Bank's and Company's capital ratios exceeded the minimum thresholds established for a well-capitalized bank by regulatory measures. 

On April 17, 2012, the Board of Directors of BNC Bancorp declared a $0.05per share quarterly cash dividend on its common stock and Series B Preferred stock, payable May 25, 2012to shareholders of record on May 11, 2012.

About BNC Bancorp and Bank of North Carolina

Headquartered in High Point, NC, BNC Bancorp is the parent company of Bank of North Carolina, a commercial bank with $2.4 billionin assets.  Bank of North Carolinaprovides a complete line of banking and financial services to individuals and businesses through its 31 banking offices in North and South Carolina.  The Bank's seven locations in South Carolinaoperate as BNC Bank.  Bank of North Carolinais insured by the FDIC and is an equal housing lender.  BNC Bancorp's stock is traded and quoted in the NASDAQ Capital Market under the symbol "BNCN."

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States.  BNC Bancorp's management uses these "non-GAAP" measures such as "core" or "recurring" earnings in their analysis of the Company's performance.  Management believes that these non-GAAP financial measures provide a greater understanding of ongoing operations and enhance comparability of results with prior periods as well as demonstrating the effects of significant gains and charges in the current period. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995:

Congress passed the Private Securities Litigation Act of 1995 in an effort to encourage corporations to provide information about companies' anticipated future financial performance.  This act provides a safe harbor for such disclosure, which protects the companies from unwarranted litigation if actual results are different from management expectations.   This press release contains forward-looking statements relating to the financial condition, results of operations and business of BNC Bancorp and the Bank.  These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of the management of BNC Bancorp, and the information available to management at the time that this press release was prepared.  Factors that could cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following: (i) general economic or business conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit or other services; (ii) expected cost savings and other benefits anticipated in connection with our acquisitions of Beach First, Regent, and Blue Ridgemay not be fully realized or realized within the expected time frame; (iii) the performance of our mortgage and SBA division; and (iv) anticipated acquisition opportunities may be available on terms acceptable to BNC Bancorp or at all.  Additional factors affecting BNC Bancorp and the Bank are discussed in BNC Bancorp's filings with the Securities and Exchange Commission (the "SEC"), Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q and its Current Reports on Form 8-K.  Please refer to the Securities and Exchange Commission's website at www.sec.gov where you can review those documents.  BNC Bancorp does not undertake a duty to update any forward-looking statements made in this press release. 

QUARTERLY PERFORMANCE SUMMARY






BNC BANCORP






(Dollars in thousands, except share and per share data)






(Unaudited)

For the







Three Months Ended







March 31, 2012


March 31, 2011


% Change

SUMMARY STATEMENTS OF OPERATIONS







Interest income

$             27,179


$             25,042


8.5 %


Interest expense

8,567


8,364


2.4


Net interest income

18,612


16,678


11.6


Provision for loan losses

5,179


3,500


48.0


Net interest income after provision for loan losses

13,433


13,178


1.9


Non-interest income

5,809


2,425


139.6


Non-interest expense

17,825


14,732


21.0


Income before income tax benefit

1,417


871


62.7


Income tax benefit

(308)


(647)


(52.4)


Net income

1,725


1,518


13.6


Preferred stock dividends and discount accretion

601


601


0.0


Net income available to common shareholders

$               1,124


$                  917


22.6










PER SHARE DATA







Earnings per share, basic

$                 0.11


$                 0.09


22.2%


Earnings per share, diluted

0.11


0.09


22.2


Tangible common book value per share

9.75


8.70


12.1










Weighted average participating common shares:







Basic

10,910,515


10,860,434




Diluted

10,920,400


10,878,950



Period-end number of shares:







Common

9,113,501


9,059,809




Convertible preferred

1,804,566


1,804,566












PERFORMANCE RATIOS







Return on average assets

0.29%


0.29%




Return on average common equity

4.09%


3.53%




Return on average tangible common equity

5.53%


4.84%




Net yield on earning assets (taxable equivalent)

3.80%


3.87%




Average equity to average assets

6.55%


7.08%




Allowance for loan losses as a % of total loans

2.13%


1.59%




Nonperforming assets to total assets, end of period

6.53%


6.54%





Nonperforming assets not covered by loss share

2.08%


3.03%




Ratio of net charge-offs, with covered portion, to








average total loans, annualized

0.89%


1.07%












QUARTERLY PERFORMANCE SUMMARY 










BNC BANCORP












(Dollars in thousands, except share and per share data)








(Unaudited)

For the





Three Months Ended





March 31,
2012


December 31, 2011


September 30,      2011


June 30,
 2011


March 31, 
2011


December 31, 2010

SUMMARY STATEMENTS OF OPERATIONS













Interest income

$             27,179


$             28,449


$             25,065


$             24,787


$             25,042


$             25,329


Interest expense

8,567


8,338


8,197


8,021


8,364


9,051


Net interest income

18,612


20,111


16,868


16,766


16,678


16,278


Provision for loan losses

5,179


8,158


3,524


3,032


3,500


12,000


Net interest income after provision for loan losses

13,433


11,953


13,344


13,734


13,178


4,278


Non-interest income

5,809


12,168


3,839


2,371


2,425


1,847


Non-interest expense

17,825


23,525


14,715


14,893


14,732


17,202


Income (loss) before income tax expense (benefit)

1,417


596


2,468


1,212


871


(11,077)


Income tax expense (benefit)

(308)


(801)


46


(381)


(647)


(5,021)


Net income (loss)

1,725


1,397


2,422


1,593


1,518


(6,056)


Preferred stock dividends and discount accretion

601


601


601


601


601


600


Net income (loss) available to common shareholders

$               1,124


$                  796


$               1,821


$                  992


$                  917


$             (6,656)

















Net interest income, as reported

$             18,612


$             20,111


$             16,868


$             16,766


$             16,678


$             16,278



Tax-equivalent adjustment 

1,365


1,406


1,392


1,322


1,475


1,494


Net interest income, tax-equivalent

$             19,977


$             21,517


$             18,260


$             18,088


$             18,153


$             17,772
















PER SHARE DATA













Earnings per share, basic

$                 0.11


$                 0.08


$                 0.18


$                 0.10


$                 0.09


$                (0.61)


Earnings per share, diluted

0.11


0.08


0.18


0.10


0.09


(0.61)
















Weighted average participating common shares:













Basic

10,910,515


10,894,799


10,884,801


10,869,868


10,860,434


10,848,790


Diluted

10,920,400


10,913,746


10,899,653


10,886,162


10,878,950


10,926,772

Period-end number of shares:













Common

9,113,501


9,100,890


9,085,980


9,075,395


9,059,809


9,053,360


Convertible preferred

1,804,566


1,804,566


1,804,566


1,804,566


1,804,566


1,804,566
















PERFORMANCE RATIOS













Return on average assets

0.29%


0.24%


0.44%


0.30%


0.29%


-1.11%


Return on average common equity

4.09%


2.78%


6.47%


3.67%


3.53%


-22.77%


Return on average tangible common equity

5.53%


3.72%


8.65%


4.96%


4.84%


-30.18%


Net yield on earning assets (taxable equivalent)

3.80%


4.18%


3.79%


3.84%


3.87%


3.69%


Average equity to average assets

6.55%


6.83%


7.29%


7.25%


7.08%


7.56%


Nonperforming assets to total assets, end of period

6.53%


6.57%


6.24%


6.60%


6.54%


6.29%



Nonperforming assets not covered by loss share

2.08%


1.93%


2.75%


3.05%


3.03%


2.75%


Ratio of net charge-offs, with covered portion, to














average total loans, annualized

0.89%


1.79%


0.70%


1.04%


1.07%


1.62%































QUARTERLY PERFORMANCE SUMMARY











BNC BANCORP












(Dollars in thousands)












(Unaudited)

As of  













March 31, 
2012


March 31, 
2011


% Change







SELECTED BALANCE SHEET DATA













End of period balances













Loans:














Loans not covered by loss share

$       1,417,529


$       1,227,291


15.5 %









Loans covered by loss share

307,097


301,436


1.9









Allowance for loan losses

(36,722)


(24,325)


51.0









Net loans

1,687,904


1,504,402


12.2








Loans held for sale

19,967


1,679


1,089.2








Investment securities

342,739


333,265


2.8








Intangible assets

28,980


28,343


2.3








Total assets

2,408,890


2,157,280


11.7























Deposits:














Non-interest bearing deposits

162,857


116,286


40.1









Interest-bearing demand and savings

956,784


849,392


12.6









Time deposits

996,831


905,173


10.1









Total deposits

2,116,472


1,870,851


13.1








Borrowed funds

117,844


120,939


(2.6)








Total interest-bearing liabilities

2,071,459


1,875,504


10.5








Shareholders' equity:














Preferred equity

47,518


47,038


1.0









Common equity

116,284


112,685


3.2









Accumulated other comprehensive income (loss)

1,561


(5,512)


(128.3)









Total shareholders' equity

165,363


154,211


7.2


























As of  





March 31, 
2012


December 31, 2011


September 30,      2011


June 30,
2011


March 31, 
2011


December 31, 2010

SELECTED BALANCE SHEET DATA













End of period balances













Loans:














Loans not covered by loss share

$       1,417,529


$       1,389,450


$       1,309,893


$       1,244,862


$       1,227,291


$       1,198,838



Loans covered by loss share

307,097


320,033


262,673


283,685


301,436


309,342



Allowance for loan losses

(36,722)


(31,008)


(24,177)


(23,373)


(24,325)


(24,813)



Net loans

1,687,904


1,678,475


1,548,389


1,505,174


1,504,402


1,483,367


Loans held for sale

19,967


9,596


6,753


1,909


1,679


6,751


Investment securities

342,739


379,257


348,989


339,381


333,265


358,871


Intangible assets

28,980


29,115


28,154


28,249


28,343


28,445


Total assets

2,408,890


2,454,930


2,197,758


2,146,745


2,157,280


2,149,932

















Deposits:














Non-interest bearing deposits

162,857


145,688


130,978


128,694


116,286


107,547



Interest-bearing demand and savings

956,784


909,402


833,190


835,967


849,392


841,062



Time deposits

996,831


1,063,097


871,436


885,922


905,173


879,461



Total deposits

2,116,472


2,118,187


1,835,604


1,850,583


1,870,851


1,828,070


Borrowed funds

117,844


163,924


190,172


129,833


120,939


157,920


Total interest-bearing liabilities

2,071,459


2,136,423


1,894,798


1,851,722


1,875,504


1,878,443


Shareholders' equity:














Preferred equity

47,518


47,398


47,278


47,158


47,038


46,918



Common equity

116,284


115,447


114,924


113,400


112,685


112,104



Accumulated other comprehensive income (loss)

1,561


1,010


373


(2,989)


(5,512)


(6,798)



Total shareholders' equity

165,363


163,855


162,575


157,569


154,211


152,224































QUARTERLY PERFORMANCE SUMMARY











BNC BANCORP












(Dollars in thousands)












(Unaudited)































For the Three Month Period Ended





March 31, 
2012


December 31, 2011


September 30,      2011


June 30, 
2011


March 31, 
2011


December 31, 2010

SELECTED BALANCE SHEET DATA













Quarterly average balances













Loans:














Loans not covered by loss share

$       1,406,611


$       1,358,455


$       1,274,530


$       1,238,661


$       1,210,550


$       1,152,263



Loans covered by loss share

313,339


291,353


273,179


292,561


305,389


320,052



Total loans

1,719,950


1,649,808


1,547,709


1,531,222


1,515,939


1,472,315


Investment securities, at amortized cost

346,192


345,613


334,709


323,661


352,480


344,146


Total earning assets

2,112,991


2,040,766


1,913,795


1,888,007


1,901,574


1,899,557


Total assets

2,415,639


2,359,374


2,179,220


2,144,753


2,150,436


2,155,061

















Deposits:














Non-interest bearing deposits

152,239


139,928


129,390


123,398


110,957


110,401



Interest-bearing demand and savings

936,871


887,136


832,536


839,169


845,630


820,640



Time deposits

1,034,249


1,015,273


889,363


884,100


887,338


903,967



Total deposits

2,123,359


2,042,337


1,851,289


1,846,667


1,843,925


1,835,008


Borrowed funds

125,624


135,118


159,213


137,020


144,783


131,684


Total interest-bearing liabilities

2,096,744


2,037,527


1,881,112


1,860,289


1,877,751


1,856,291


Shareholders' equity

158,114


161,039


158,926


155,584


152,250


162,865
















LOAN MIX AND STRATIFICATION STATISTICS






BNC BANCORP






(Dollars in thousands)






(Unaudited)










As of March 31, 







2012


2011


% Change

Loans Not Covered Under Loss Share Agreements:







Construction, A&D, and Land

$               194.5


$               194.1


0.2



Residential Construction

25.6


28.0


(8.6)




Presold

14.5


12.3


17.9




Speculative

11.1


15.7


(29.3)




Loan size - over $400,000

2.7


4.5


(40.0)




Loan size - $200,000 to $400,000

3.3


1.7


94.1




Loan size - under $200,000

5.1


9.5


(46.3)












Commercial Construction

72.3


43.9


64.7




Loan size - $5 million and over

9.5


7.4


28.4




Loan size - $3 million to $5 million

7.7


10.9


(29.4)




Loan size - $1 million to $3 million

39.2


11.4


243.9




Loan size - under $1 million

15.9


14.2


12.0












Residential and Commercial A&D

14.1


23.4


(39.7)




Loan size - $5 million to $6 million

-


6.1


(100.0)




Loan size - $3 million to $5 million

-


-


-




Loan size - $1 million to $3 million

10.1


11.9


(15.1)




Loan size - under $1 million

4.0


5.4


(25.9)












Land

82.5


98.8


(16.5)




Residential Buildable Lots

26.8


40.3


(33.5)




Commercial Buildable Lots

13.1


14.7


(10.9)




Land Held for Development

25.3


26.8


(5.6)




Raw and Agricultural Land

17.3


17.0


1.8











Commercial Real Estate

$               759.9


$               588.2


29.2



Multi-Family

38.2


43.2


(11.6)



Churches

37.0


26.9


37.6



Retail

552.7


400.4


38.0




Owner Occupied

162.0


123.4


31.3




Investment

390.7


277.0


41.1




Loan size - $5 million to $9 million

74.7


54.3


37.6




Loan size - $3 million to $5 million

65.3


50.9


28.3




Loan size - $1 million to $3 million

146.9


91.8


60.0




Loan size - under $1 million

103.8


80.0


29.8












Industrial

132.0


117.7


12.2




Owner Occupied

65.9


58.7


12.3




Investment

66.1


59.0


12.0




Loan size - $5 million to $6 million

-


-


-




Loan size - $3 million to $5 million

4.2


7.7


(45.5)




Loan size - $1 million to $3 million

34.8


25.1


38.7




Loan size - under $1 million

27.1


26.2


3.4










LOAN MIX AND STRATIFICATION STATISTICS










BNC BANCORP











(Dollars in thousands)











(Unaudited)

Trends 






March 31,    2012


December 31, 2011


September 30, 
2011


June 30, 
2011


March 31,    2011


Loans Not Covered Under Loss Share Agreements:












Construction, A&D, and Land

$               194.5


$               203.2


$               212.8


$               196.6


$               194.1




Residential Construction

25.6


25.0


25.2


24.9


28.0





Presold

14.5


13.4


13.6


12.2


12.3





Speculative

11.1


11.6


11.6


12.7


15.7





Loan size - over $400,000

2.7


2.9


1.5


3.8


4.5





Loan size - $200,000 to $400,000

3.3


3.4


1.0


3.7


1.7





Loan size - under $200,000

5.1


5.3


9.1


5.2


9.5


















Commercial Construction

72.3


71.7


73.5


54.4


43.9





Loan size - $5 million and over

9.5


9.3


14.1


12.6


7.4





Loan size - $3 million to $5 million

7.7


8.5


8.7


7.8


10.9





Loan size - $1 million to $3 million

39.2


32.4


34.5


20.9


11.4





Loan size - under $1 million

15.9


21.5


16.2


13.1


14.2


















Residential and Commercial A&D

14.1


14.0


21.6


22.0


23.4





Loan size - $5 million to $6 million

-


-


6.1


6.0


6.1





Loan size - $3 million to $5 million

-


-


-


-


-





Loan size - $1 million to $3 million

10.1


10.1


11.1


12.1


11.9





Loan size - under $1 million

4.0


3.9


4.4


3.9


5.4


















Land

82.5


92.5


92.5


95.3


98.8





Residential Buildable Lots

26.8


32.8


33.1


36.0


40.3





Commercial Buildable Lots

13.1


15.3


13.5


13.5


14.7





Land Held for Development

25.3


25.4


26.1


26.6


26.8





Raw and Agricultural Land

17.3


19.0


19.8


19.2


17.0

















Commercial Real Estate

$               759.9


$               723.5


$               649.5


$               605.8


$               588.2




Multi-Family

38.2


38.1


34.4


34.4


43.2




Churches

37.0


36.5


36.2


28.2


26.9




Retail

552.7


515.9


457.7


425.1


400.4





Owner Occupied

162.0


153.4


137.5


136.6


123.4





Investment

390.7


362.5


319.9


288.5


277.0





Loan size - $5 million to $9 million

74.7


80.3


61.9


51.7


54.3





Loan size - $3 million to $5 million

65.3


56.9


61.2


54.3


50.9





Loan size - $1 million to $3 million

146.9


130.1


107.8


98.5


91.8





Loan size - under $1 million

103.8


95.2


89.0


84.0


80.0


















Industrial

132.0


133.0


121.2


118.1


117.7





Owner Occupied

65.9


64.2


61.1


59.6


58.7





Investment

66.1


68.8


60.1


58.5


59.0





Loan size - $5 million to $6 million

-


-


-


-


-





Loan size - $3 million to $5 million

4.2


7.5


7.6


7.6


7.7





Loan size - $1 million to $3 million

34.8


35.2


27.2


26.0


25.1





Loan size - under $1 million

27.1


26.1


25.3


24.9


26.2






























SOURCE BNC Bancorp

distributed by