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American Community Bancshares Inc (1106980) SEC Filing 8-K Material Event for the period ending Wednesday, April 23, 2008

American Community Bancshares Inc

CIK: 1106980

Exhibit 99.1

PRESS RELEASE

FOR IMMEDIATE RELEASE

For Further Information Contact

American Community Bancshares, Inc.

Mr. Randy P. Helton, President and CEO

Phone: 704-225-8444

American Community Bancshares, Inc. Announces

Results for the Quarter Ended MARCH 31, 2008 AND DECLARES SECOND QUARTER

DIVIDEND OF $0.05 PER SHARE

April 23, 2008. Charlotte, North Carolina: American Community Bancshares, Inc. (Nasdaq: ACBA), the holding company for American Community Bank, announced unaudited earnings decreased for the three months ended March 31, 2008 as compared to unaudited earnings for the same period of 2007. Unaudited earnings as of March 31, 2008 were $991,000, a decrease of $296,000 or 23.0% from unaudited earnings at March 31, 2007. Unaudited net interest income for the quarter decreased to $4.3 million from $4.8 million for the same period in 2007, a decrease of $483,000 or 10.1%.

Net interest margin is interest income earned on loans, securities and other earning assets, less interest expense paid on deposits and borrowings, expressed as a percentage of total average earning assets. The net interest margin for the quarter ended March 31, 2008 was 3.76% compared to 4.38% for the same quarter in 2007. The decrease in net interest margin is primarily a result of deposit and borrowings costs decreasing more slowly than the yield on earning assets. The Federal Open Market Committee (FOMC) decreased short-term rates seven times for a total of 300 basis points beginning September 18, 2007 and ending March 18, 2008. Since the majority of our loans float with the prime lending rate, the yield on our loans decreased immediately as the FOMC lowered rates. Due to the longer term maturity structure of our deposits and borrowings, the costs of those liabilities were slower to decrease.

The Company reported unaudited non-interest income of $1.0 million for the quarter ended March 31, 2008, an increase of approximately 26.3% over the comparable period in 2007. In addition, operating expenses decreased $30,000 or less than 1.0% to $3.4 million for the quarter ended March 31, 2008.


Total assets as of March 31, 2008 were $524.2 million, compared to $489.0 million at March 31, 2007, an increase of $35.2 million or 7.2%. The Company also experienced similar growth in loans and deposits. Total loans were $405.0 million, an increase of $29.6 million or 7.9%, over the $375.4 million reported at March 31, 2007. Total deposits were $411.1 million, an increase of $15.1 million or 3.8% over first quarter 2007 deposits of $396.0 million.

The Company’s provision for loan losses for the quarter ended March 31, 2008 was $425,000, representing a $242,000 or 132.2% increase from the $183,000 recorded for the quarter ended March 31, 2007. The increase in the provision was a combination of growth in the loan portfolio and an increase in non-performing loans and leases by a total of $906,000 or 59.3% from $1.5 million at March 31, 2007 to $2.4 million at March 31, 2008. Gross loans grew $12.0 million for the three months ended March 31, 2008 compared to the $5.0 million growth for the three months ended March 31, 2007. While the Bank is in one of the stronger markets in the Southeast, the Bank continues to take a conservative approach to lending in view of the softening economy.

The Company is also pleased to announce the Board of Directors declared a quarterly cash dividend for the second quarter of 2008 of $0.05 per share. The dividend will be paid on June 2, 2008 to shareholders of record on May 23, 2008.

American Community Bancshares, headquartered in Charlotte, NC is the holding company for American Community Bank. American Community Bank is a full service community bank, headquartered in Monroe, NC with nine North Carolina offices located in the fast growing Union and Mecklenburg counties and four South Carolina offices located in York and Cherokee counties. The Bank provides a wide assortment of traditional banking and financial services offered with a high level of personal attention. American Community Bancshares website is www.americancommunitybank.com. American Community Bancshares stock is traded on the NASDAQ Capital market under the symbol “ACBA”. For more information contact- Stephanie Helms, Shareholder Relations or Dan Ellis, CFO at (704) 225- 8444.


American Community Bancshares, Inc.

(Amounts in thousands except share and per share data)

(Unaudited)

Consolidated Balance Sheet

 

     March 31,
2008
    December 31,
2007 (a)
    September 30,
2007
    June 30,
2007
    March 31,
2007
 

Assets

          

Cash and due from banks

   $ 16,126     $ 14,346     $ 15,684     $ 17,989     $ 17,977  

Interest-earning deposits with banks

     682       930       5,484       11,481       14,381  

Investment securities

     79,521       76,782       79,043       74,012       59,946  

Loans

     404,954       392,959       373,309       381,415       375,395  

Allowance for loan losses

     (6,095 )     (5,740 )     (5,374 )     (5,543 )     (5,472 )
                                        

Net loans

     398,859       387,219       367,935       375,872       369,923  

Accrued interest receivable

     2,398       2,640       2,922       2,615       2,751  

Bank premises and equipment

     8,605       8,694       8,746       8,927       9,046  

Foreclosed real estate

     —         —         25       25       25  

Non-marketable equity securities at cost

     2,814       2,119       2,119       2,119       1,819  

Goodwill

     9,838       9,838       9,838       9,838       9,838  

Other assets

     5,308       3,027       3,232       2,803       3,302  
                                        

Total assets

   $ 524,151     $ 505,595     $ 495,028     $ 505,681     $ 489,008  
                                        

Liabilities and stockholders’ equity

          

Deposits

          

Non-interest bearing

   $ 53,439     $ 54,459     $ 54,805     $ 58,453     $ 62,414  

Interest bearing

     357,701       345,335       342,574       349,013       333,576  
                                        

Total deposits

     411,140       399,794       397,379       407,466       395,990  

Borrowings

     55,709       49,504       43,533       40,984       34,934  

Accrued expenses and other liabilities

     1,807       2,273       1,649       1,272       1,797  
                                        

Total liabilities

     468,656       451,571       442,561       449,722       432,721  

Total stockholders’ equity

     55,495       54,024       52,467       55,959       56,287  
                                        

Total liabilities and stockholders’ equity

   $ 524,151     $ 505,595     $ 495,028     $ 505,681     $ 489,008  
                                        

Ending shares outstanding

     6,542,091       6,502,288       6,502,288       6,961,236       7,020,343  

Book value per share

     8.48     $ 8.31     $ 8.07     $ 8.04     $ 8.02  

Average Balances:

          

Loans

   $ 389,144     $ 379,191     $ 372,407     $ 373,741     $ 369,191  

Earning assets

     471,071       462,078       460,577       460,615       444,022  

Total assets

     513,398       499,430       501,961       496,220       487,791  

Interest-bearing deposits

     351,699       344,619       346,820       341,627       331,231  

Stockholders’ equity

     55,069       53,366       54,041       56,236       55,752  

 

(a) Derived from audited consolidated financial statements


American Community Bancshares, Inc.

Consolidated Income Statements

(Amounts in thousands except share and per share data)

(Unaudited)

 

Three months ended    March 31,
2008
    December 31,
2007
    September 30,
2007
    June 30,
2007
    March 31,
2007
 

Total interest income

   $ 8,188     $ 8,737     $ 9,070     $ 8,921     $ 8,698  

Total interest expense

     3,873       4,068       4,225       4,001       3,899  
                                        

Net interest income

     4,315       4,669       4,845       4,920       4,799  

Provision for loan losses

     425       471       156       231       183  
                                        

Net interest income after provision for loan loss

     3,890       4,198       4,689       4,689       4,616  
                                        

Non-interest income

          

Service charges on deposit accounts

     602       613       617       608       581  

Mortgage banking operations

     86       83       70       93       80  

Realized gains on sale of securities

     —         —         2       —         17  

Gain/loss on derivatives

     272       132       138       (67 )     11  

Other

     59       73       134       88       118  
                                        

Total non-interest income

     1,019       901       961       722       807  
                                        

Non-interest expense

          

Salaries and employee benefits

     1,743       1,724       1,768       1,743       1,658  

Occupancy and equipment

     584       505       560       564       565  

Other than temporary impairment

     —         —         —         —         76  

Other

     1,044       1,132       1,121       1,175       1,103  
                                        

Total non-interest expense

     3,371       3,361       3,449       3,482       3,402  
                                        

Income before income taxes

     1,538       1,738       2,201       1,929       2,021  

Provision for income taxes

     547       626       801       707       735  
                                        

Net income

   $ 991     $ 1,112     $ 1,400     $ 1,222     $ 1,286  
                                        

Net income per share

          

Basic

   $ 0.15     $ 0.17     $ 0.21     $ 0.18     $ 0.18  

Diluted

   $ 0.15     $ 0.17     $ 0.21     $ 0.17     $ 0.18  

Weighted average number of shares outstanding

          

Basic

     6,513,526       6,502,288       6,635,709       6,978,724       7,008,971  

Diluted

     6,623,392       6,652,452       6,799,753       7,140,680       7,176,577  

Return on average equity

     7.24 %     8.26 %     10.28 %     8.81 %     9.36 %

Return on average assets

     0.78 %     0.88 %     1.11 %     1.00 %     1.05 %

Net interest margin

     3.76 %     4.01 %     4.22 %     4.28 %     4.38 %

Efficiency ratio

     63.20 %     60.34 %     59.40 %     61.72 %     60.68 %

Allowance for loan losses to total loans

     1.51 %     1.46 %     1.44 %     1.45 %     1.46 %

Net charge-offs to avg loans (annualized)

     0.07 %     0.10 %     0.35 %     0.17 %     0.37 %

Nonperforming loans to total loans

     0.60 %     0.44 %     0.37 %     0.40 %     0.41 %

Nonperforming assets to total assets

     0.47 %     0.34 %     0.29 %     0.31 %     0.32 %

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CIK: 1106980
Form Type: 8-K Corporate News
Accession Number: 0001193125-08-095071
Submitted to the SEC: Tue Apr 29 2008 4:14:33 PM EST
Accepted by the SEC: Tue Apr 29 2008
Period: Wednesday, April 23, 2008
Industry: State Commercial Banks
Events:
  1. Earnings Release
  2. Financial Exhibit
  3. New Agreement
  4. Other Events

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