Community Bankers Trust Corporation (NASDAQ:ESXB) Q3 2019 Earnings Conference Call - Final Transcript
Oct 25, 2019 • 10:00 am ET
Good day, and welcome to the Community Bankers Trust Corporation Third Quarter 2019 Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.
I would now like to turn the conference over to Rex Smith, President and CEO. Please go ahead.
Rex L. Smith
Good morning, and thank you for joining us today as we review the results of the third quarter and year-to-date for 2019 for Community Bankers Trust Corporation, which is the holding company for Essex Bank. First, a brief reminder that during the course of our remarks today, we may make forward-looking statements within the meaning of applicable securities laws with respect to our operations, performance, future strategy and goals.
I remind everyone that our actual results may differ materially from those included in the forward-looking statements due to a number of factors. These factors and additional risks and uncertainties are included in our earnings release and most recent Form 10-K and other reports that Community Bankers Trust Corporation files with or furnishes to the Securities and Exchange Commission. You can access all of these documents through our website at www.cbtrustcorp.com.
Last year at this time, I reported that net income year-to-date was higher than it has been since the formation of the Company in 2008 and that was $10.3 million. I am excited to report that we have beaten that number for 2019 by over $1.3 million. Net income for the first nine months of 2019 is $11.66 million. This equates to an annualized ROA of 1.10%. Annualized return on equity is 10.71%. There were numerous positive factors that contributed to the success of the quarter and most of these trends are sustainable for the future.
Loan growth, excluding PCI loans, increased $72 million or 7.5% year-over-year. This is the first time in two years that we have seen this much growth at this point in the year and the growth was not from being aggressive on either rate or credit quality. The yield on loans increased to 5.03% despite both the competitive nature of our markets and a change in loan mix to more adjustable rate loans.
Credit quality continues to be a strong focus for both new loans and the existing portfolio. Total non-performing loans are just over half of what they were at the beginning of the year. This includes moving our largest and oldest non-performing loan into OREO to push for final resolution. Our current credit quality metrics are among the top of our peer banks. The Bank also continued to increase its growth in demand deposits. Non-interest-bearing deposits grew $24.1 million or 15.2% year-over-year, representing 15.5% of total deposits compared to 14% this time last year.
I believe this shows that we can continue at double-digit growth in these accounts, which will continually decrease our cost of funds moving forward. We also continually focus on our efficiency and controlling cost. As part of