Earnings ReleaseVersaBank Reports First Quarter 2018 Results with a 27 Increase in Core Cash Earnings Feb. 28, 2018 BRIEF-Versabank Reports Quarterly Earnings Per Share Of C$0.16
Feb 28 (Reuters) - Versabank:
* VERSABANK QTRLY TOTAL REVENUE C$12.4 MILLION VERSUS C$11.5 MILLION IN PRIOR QUARTER
* VERSABANK REPORTS FIRST QUARTER 2018 RESULTS WITH A 27% INCREASE IN CORE CASH EARNINGS OVER THE PREVIOUS QUARTER(1)(2)
* VERSABANK QUARTERLY CORE CASH EARNINGS PER SHARE OF C$0.28
* VERSABANK QUARTERLY EARNINGS PER SHARE OF C$0.16
VersaBank, (“VB” or the “Bank”), (TSX: VB), today reported net income of $4.0 million for the quarter, compared to $11.9 million for the same period last year, which reflected the Bank recognizing $8.8 million in deferred income tax assets in January 2017.
Core cash earnings for the quarter was up 26% to $5.9 million from $4.7 million for the same period last year.
Mr. David Taylor, President & CEO commented, “Our Bank’s model of using advanced technologies to serve niche markets is continuing to demonstrate its tremendous power. This is evidenced by the Bank accomplishing quarter over quarter core cash earnings growth of 27%, building off the amazing 50% four year compound annual growth rate (“CAGR”) trajectory that was achieved at the end of our last fiscal year.
Despite the two recent increases in the Bank of Canada rate our Bank was able to maintain its very low cost of funds and increase its net interest margin (“NIM”) for the quarter to an industry leading 2.87%, all while maintaining a highly disciplined approach to credit risk management as demonstrated by the Bank’s exceptionally low provision for credit losses. Further, net income for the quarter was up 41% to $4.0 millionfrom $2.8 million last quarter driven primarily by a 7% increase in NIM, and an 8% decline in non-interest expenses over the same period.
Our Bank was formed to explore, and if appropriate apply digital technologies to areas of traditional banking where we thought we could provide a better product or service. Early in our history, we created a new method of digitally acquiring deposits and later a new method of acquiring loan and lease receivables. Both of these ground breaking initiatives are working out very well and are now giving rise to outstanding profit margins and growth. Not content to ‘rest on our laurels’ we decided to explore the application of digital technology to another traditional service that banks have been providing for centuries, that being custodial services. Considering the tremendous growth in ‘digital valuables’ we decided to build a digital storage facility or “digital safety deposit box”. This new initiative is taking place in a wholly owned subsidiary of the Bank that we have calledVersaVault Inc. Since the announcement of VersaVault (“VV”), we have received considerable interest in our new product and are looking forward to having a prototype ready this coming spring. We expect incremental costs associated with the creation of VV to be minimal.”
- Common share book value of $8.64 (up 5% from $8.20)
- CET1 ratio of 10.68% (up from 10.28%) Leverage ratio of 10.34% (up from 9.45%)
Feb. 28, 2018-- VersaBank (TSX: VB) today announced that its Board of Directors have declared quarterly cash dividends on its Common Shares (TSX: VB) and 7.0% Series 1 Preferred Shares (TSX:VB.PR.A) and 7.0% Series 3 Preferred Shares (TSX:VB.PR.B).
The Common Share dividend of $0.01 per share and the Series 1 Preferred Share and Series 3 Preferred Share dividends of $0.175 per share are payable, subject to the approval of the Toronto Stock Exchange(“TSX”), as of April 30, 2018 to shareholders of record at the close of business on April 6, 2018.
The dividends to which this notice relates are eligible dividends for tax purposes.