[norweger1979]

SmartBank to acquire Tuscaloosa, Alabama-based Capstone Bank

East Tennessee-based bank extends footprint to Alabama

Company Release - 5/22/2017 6:00 PM ET


KNOXVILLE, Tenn., May 22, 2017 (GLOBE NEWSWIRE) -- SmartFinancial, Inc., parent company of SmartBank (“SmartFinancial”) (NASDAQ:SMBK), and Capstone Bancshares, Inc., parent company of Capstone Bank (“Capstone”), jointly announced today the signing of a definitive merger agreement pursuant to which SmartFinancial will acquire Capstone. Upon the completion of the transaction, the combined company is expected to have assets in excess of $1.5 billion.


“This is a compelling acquisition and we’re excited to partner with Capstone as we look to grow and further expand our footprint in the Southeast,” said SmartBank President and CEO, Billy Carroll. “Capstone is a great community bank and we admire their leadership and the culture they’ve created. Much like our bank, Capstone has a strong history of service to both its customers and local communities and we look forward to building on that together.”

According to Capstone Bank’s President and CEO, Robert Kuhn, the merger is a perfect fit. “We could not have picked a better partner from a community banking perspective. SmartBank’s core values align perfectly with Capstone’s, with a strong emphasis on client service, culture and the communities we serve.”

“Our customers will benefit immediately from this partnership, as we enhance our ability to provide each of them with additional resources and the best banking options available,” added Kuhn.

Established in 2007, SmartBank has more than $1 billion in assets and operates 14 branches and two loan production office spanning East Tennessee and the Florida Panhandle. This marks the fourth acquisition in the bank’s past five years.

Capstone Bank was formed in 2008 and is headquartered in Tuscaloosa, Alabama. The bank has eight locations in Tuscaloosa, Washington and Clarke counties, including a new office in Fairhope, in the rapidly growing Baldwin County market.

The acquisition, which is subject to customary closing conditions, including the approval of each party’s shareholders and the receipt of all necessary regulatory approvals, is expected to be completed in the fourth quarter of 2017.

The merger agreement provides for the merger of Capstone Bancshares, Inc. with and into SmartFinancial, Inc., with SmartFinancial, Inc. as the surviving corporation, and the subsequent merger of Capstone Bank with and into SmartBank, with SmartBank as the surviving bank.

Under the terms of the merger agreement, each Capstone shareholder will be allowed to elect to receive all cash consideration, all stock consideration, or 20 percent cash consideration and 80 percent stock consideration for the shareholder’s Capstone shares, subject to proration to ensure that 80 percent of the aggregate consideration paid to Capstone shareholders is in the form of SmartFinancial common stock and 20 percent of the aggregate consideration paid to Capstone shareholders is cash. Capstone shareholders receiving cash consideration will receive $18.50 per share of Capstone stock, and those receiving stock consideration will receive 0.85 shares of SmartFinancial common stock for each share of Capstone stock.

The transaction is valued at approximately $84.8 million based on the closing price of SmartFinancial common stock on May 22, 2017.

Raymond James & Associates, Inc. served as financial advisor to SmartFinancial, and SmartFinancial was represented by the law firm Butler Snow LLP. Stephens Inc. served as financial advisor to Capstone, and Capstone was represented by the law firm Burr & Forman LLP.


About SmartFinancial, Inc.

SmartFinancial, Inc., with assets in excess of $1.0 billion, is a publicly-traded bank holding company for SmartBank based in Knoxville, Tennessee. SmartBank is a full-service commercial bank founded in 2007, with 14 branches and two loan production offices spanning East Tennessee and the Florida Panhandle. Recruiting the best people, delivering exceptional client service, strategic branching and a disciplined approach to lending have contributed to SmartBank’s success. More information about SmartFinancial can be found on its website: www.smartfinancialinc.com.

About Capstone Bancshares, Inc.

Capstone Bancshares, Inc. is the bank holding company for Capstone Bank, an Alabama chartered bank headquartered in Tuscaloosa, Alabama. Capstone Bank has offices in Tuscaloosa, Washington, Clarke and Baldwin counties. As of March 31, 2017, Capstone Bank had total assets of approximately $510 million, deposits of approximately $446 million, and loans of approximately $412 million.

Important Information for Investors and Shareholders

In connection with the proposed merger, SmartFinancial, Inc. (“SmartFinancial”) will file with the Securities and Exchange Commission (“SEC”) a registration statement on Form S-4 containing a joint proxy statement/prospectus of Capstone Bancshares, Inc. (“Capstone”) and SmartFinancial. A definitive joint proxy statement/prospectus will be mailed to shareholders of both SmartFinancial and Capstone. Shareholders of SmartFinancial and Capstone are urged to read the joint proxy statement/prospectus and other documents that will be filed with the SEC carefully and in their entirety when they become available because they will contain important information. Shareholders will be able to obtain free copies of the registration statement and the joint proxy statement/prospectus (when available) and other documents filed with the SEC by SmartFinancial through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed with the SEC by SmartFinancial will also be available free of charge on SmartFinancial’s website at www.smartfinancialinc.com or by contacting SmartFinancial’s Investor Relations Department at [phone].

SmartFinancial, Capstone, their directors and executive officers, and other members of management and employees may be considered participants in the solicitation of proxies in connection with the proposed transaction. Information about the directors and executive officers of SmartFinancial is set forth in SmartFinancial’s proxy statement for its 2017 annual shareholders meeting. Other information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available.

Forward Looking Statement Disclosure

This release contains forward-looking statements. SmartFinancial cautions you that a number of important factors could cause actual results to differ materially from those currently anticipated in any forward-looking statement. Such factors include, but are not limited to: the businesses of Capstone and SmartFinancial may not be integrated successfully or such integration may take longer to accomplish than expected; the expected cost savings and revenue synergies from the merger may not be fully realized within the expected timeframes or at all; disruption from the merger may make it difficult to maintain relationships with clients or employees; the required governmental approvals for the merger may not be obtained on the proposed terms and schedules or at all; Capstone’s shareholders and/or SmartFinancial’s shareholders may not approve the merger; changes in prevailing economic and political conditions, particularly in our market areas, including the areas served by Capstone; credit risk associated with our lending activities; changes in interest rates, loan demand, real estate values, and competition; changes in accounting principles, policies, and guidelines; changes in any applicable law, rule, regulation, or practice with respect to tax or legal issues; and other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products, and services and other factors that may be described in our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q as filed with the SEC from time to time. The forward-looking statements are made as of the date of this release, and, except as may be required by applicable law or regulation, SmartFinancial assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.



Investor Contacts
Billy Carroll
President & CEO
SmartFinancial, Inc.
Email: [e-mail]
[phone]

Frank Hughes
Executive Vice President
Investor Relations
SmartFinancial, Inc.
Email: [e-mail]
[phone]

Media Contact
Kelley Fowler
Senior Vice President
Public Relations/Marketing
SmartFinancial, Inc.
Email: [e-mail]
Phone: [phone]

http://www.smartfinancialinc.com/file/Index?KeyFile=2000702319

[norweger1979]

3/31/2017

Executive Summary



The following is a summary of the Company’s financial highlights and significant events during the first quarter of 2017 :


• Net income available to common shareholders totaled $1.4 million , or $0.19 per share, during the first quarter of 2017 compared to $1.1 million , or $0.20 per share, during the first quarter of 2016 .

• Annualized return on average assets was 0.64 percent in the first quarter of 2017 , compared to 0.54 percent a year ago.

• Net interest margin increased compared to a year ago due to increases in average loan balances, increases in yields of the securities portfolio, and reductions in FHLB advances and other borrowings.

• Asset quality was outstanding with nonperforming assets to total assets dropping to just 0.37 percent .

• Dividends on preferred stock dropped to $195 thousand as the company used proceeds from the capital raise to redeem the preferred stock during the quarter.

http://www.smartfinancialinc.com/file/Index?KeyFile=2000263827

[norweger1979]

Item 8.01 Other Events.

On January 30, 2017, SmartFinancial, Inc. (the “ Company ”) completed its previously announced public offering of 2,010,084 shares of its common stock, par value $1.00 per share, conducted pursuant to an Underwriting Agreement (the “ Underwriting Agreement ”), dated January 24, 2017, by and among the Company, Raymond James & Associates, Inc., as representative of the underwriters (the “ Underwriters ”), and certain selling shareholders of the Company. The offering included the sale of 1,840,000 shares, inclusive of 240,000 shares sold to the Underwriters upon their exercise of the over-allotment option set forth in the Underwriting Agreement. The offering also included 170,084 shares of common stock sold by certain shareholders of the Company. The net proceeds of the offering to the Company, after deducting the underwriting discount and estimated offering expenses payable by the Company, were approximately $33,223,353. The net proceeds to the selling shareholders were approximately $3,274,117, less applicable strike prices on shares obtained in connection with option exercises immediately prior to closing.

In connection with this offering, the Company agreed to pay the underwriting discount for all shares sold by certain selling shareholders. Additionally, the Underwriters agreed to reimburse the Company for up to $200,000 of its offering-related expenses.

[norweger1979]

SmartFinancial, Inc. Announces Launch of Public Offering of Common Stock

-redeeming the Preferred stock should result in approx. qtr. savings -$270,000


KNOXVILLE, TENNESSEE, January 18, 2017 – SmartFinancial, Inc. (“SmartFinancial”) (NASDAQ: SMBK), the holding company of SmartBank, announced the launch of its public offering of 1,770,084 shares of its common stock, of which 170,084 shares will be offered by certain selling shareholders. SmartFinancial will not receive any proceeds from shares sold by the selling shareholders. The underwriters will have a 30-day option to purchase an additional 240,000 shares of common stock to cover over-allotments, if any, from SmartFinancial.

SmartFinancial intends to use approximately $12.1 million of the net proceeds of the offering to redeem, subject to regulatory approval, its outstanding preferred stock issued to the US Treasury in connection with the company’s participation in the Small Business Lending Fund program. The company intends to use the remaining portion of the net proceeds of the offering for general corporate purposes, which may include working capital or providing capital to support its, as well as SmartBank’s, growth, organically or through the acquisition of banks or bank branches, for financing investments and capital expenditures, and for investments in SmartBank as regulatory capital.

Raymond James & Associates, Inc. is acting as lead book-running manager, and Keefe, Bruyette & Woods, a Stifel Company, and Hovde Group, LLC will serve as co-managers.

The shares are being offered pursuant to a shelf registration statement under the Securities Act of 1933, as amended, which was previously filed with and declared effective by the Securities and Exchange Commission (the “SEC”) on January 9, 2017. The offering is being made only by means of a prospectus and related preliminary prospectus supplement, copies of which may be obtained from the offices of Raymond James & Associates, Inc., 880 Carillon Parkway, St. Petersburg, Florida 33716, or by calling toll-free: [phone]. Investors may also obtain copies of these documents free of charge by visiting the SEC’s website at www.sec.gov.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. The offering may be made only by means of a prospectus and a related prospectus supplement, which have or will be filed with the SEC.

http://www.snl.com/Cache/c37571394.html

[norweger1979]

SmartFinancial Reports Fourth Quarter Results

KNOXVILLE, TN - January 17, 2017 - SmartFinancial, Inc. ("SmartFinancial"; NASDAQ: SMBK), announced today net income of $1.6 million in its fourth quarter of 2016, compared to $1.2 million a year ago. In the first quarter of 2016, SmartFinancial completed the merger of Cornerstone Community Bank with and into SmartBank. This quarter completes the third full quarter's results of the merged bank. Billy Carroll, President & CEO, stated: "We are extremely proud of the achievements of our associates during our first full year as a combined company. We had outstanding organic loan growth of over $85 million, increased demand deposits by over $33 million, and maintained a net interest margin of over 4.00 percent for the year. We generated over $4 million in non-interest income during the year thanks to increased revenues from the sale of mortgage and SBA loans and higher revenues from deposit account services. We are successfully capturing our post merger efficiency gains as demonstrated by two consecutive quarterly decreases in noninterest expense to average assets. As a result we have generated increases in both net income and return on assets the last two quarters and look forward to continuing the trend of quarterly improvements into 2017.” SmartFinancial's Chairman, Miller Welborn, concluded: "The only thing more exciting than what we as a company have accomplished over the last year are the opportunities we have before us heading into 2017. We have added a veteran team of bankers in Bradley County, Tennessee to go along with our planned branch acquisition in that market and as part of our organic growth strategy we are opening a new branch in Panama City, Florida, and that is just to start the year. We will continue to execute our objectives of growing the company while maintaining a strong margin, rigorous underwriting standards, and increasing efficiency. Every day we strive to achieve our goals of being a great place to work, a great place to bank, and making our company a rewarding investment for our shareholders. " Performance Highlights

Fourth Quarter 2016 compared to Third Quarter 2016
Exhibit No. Description 99.1 Press Release dated January 18, 2017
Section 2: EX-99.1 (EXHIBIT 99.1)

• Net income available to common shareholders totaled $1.4 million or $0.23 per share during the fourth quarter of 2016 which is up from $1.2 million or $0.20 per share in the fourth quarter of 2015.
• Annualized return on average assets equaled 0.64 percent in the fourth quarter of 2016, compared to 0.63 percent in the third quarter of 2016.
• Annualized net loan growth was approximately 8 percent in the fourth quarter and 12 percent for the full year 2016. • Asset quality was outstanding with nonperforming assets to total assets of just 0.43 percent.
• Net interest margin, taxable equivalent, increased to 4.06 percent in the quarter as the asset sensitive balance sheet reacted to the increases in interest rates and as the percentage of earning-assets to total assets increased.

Net income available to common shareholders totaled $1.4 million in the fourth quarter of 2016, or $0.22 per diluted share, compared to $1.3 million, or $0.22 per diluted share, in the third quarter of 2016.

Net operating earnings available to common shareholders, which excludes purchased loans accounting adjustments, securities gains, merger and conversion costs, and foreclosed assets gains and losses, totaled $1.4 million in the fourth quarter of 2016 compared to $1.1 million in the previous quarter.





Net interest income to average assets of 3.82 percent for the quarter increased from 3.76 percent in the third quarter of 2016. Net interest income totaled $9.9 million in the fourth quarter of 2016 compared to $9.7 million in the third quarter of 2016. Net interest income was positively impacted during the quarter by increases in earning asset balances and higher earning asset yields. Net interest margin, taxable equivalent, increased from 4.04 percent in the third quarter of 2016 to 4.06 percent in the fourth quarter of 2016 primarily due to higher average loan balances and higher loan yields. Provision for loan losses was $171 thousand in the fourth quarter of 2016, compared to $261 thousand in the third quarter of 2016. The decrease in provision for loan losses was due to credit improvements in the loan portfolio during the quarter. Annualized net charge-offs in the fourth quarter of 2016 remained at a very low level, just 0.02 percent of average loans compared to 0.01 percent the third quarter of 2016. The allowance for loan losses, or the ALLL, was $5.1 million, or 0.63 percent of total loans as of December 31, 2016, compared to $5.0 million, or 0.62 percent of total loans, as of September 30, 2016. Adjusted ALLL, which includes the ALLL as well as net acquisition accounting fair value adjustments for acquired loans, was 1.86 percent of total loans as of December 31, 2016, which was down from 1.93 percent as of September 30, 2016. The reduction in adjusted ALLL resulted from continued accretion of fair value discounts. Nonperforming loans as a percentage of total loans was 0.26 percent as of December 31, 2016, which was up slightly from 0.17 percent in the prior quarter. Total nonperforming assets (which include nonaccrual loans, loans past due 90 days or more and still accruing, and foreclosed assets) as a percentage of total assets was 0.43 percent as of December 31, 2016, compared to 0.38 percent as of September 30, 2016. Non-interest income to average assets of 0.37 percent for the quarter decreased from 0.47 percent in the third quarter of 2016. Non-interest income totaled $948 thousand in the fourth quarter of 2016, compared to $1.2 million in the third quarter of 2016. The decrease in non-interest income was primarily due to lower gains on sale of foreclosed assets.

Non-interest expense to average assets of 3.11 percent for the quarter was down from 3.13 percent in the third quarter of 2016 and was the lowest of any quarter in 2016. Non-interest expense totaled $8.0 million in the fourth quarter of 2016, which was down slightly from the third quarter of 2016. Income tax expense was $960 thousand in the fourth quarter of 2016 compared to $947 thousand in the third quarter of 2016. The company's effective tax rate was 36.81 percent in the fourth quarter of 2016 compared to 37.03 percent in the third quarter of 2016.

Fourth Quarter 2016 compared to Fourth Quarter 2015 Net income available to common shareholders totaled $1.4 million in the fourth quarter of 2016, or $0.22 per diluted share, compared to $1.2 million, or $0.19 per diluted share, in the fourth quarter of 2015. Net operating earnings available to common shareholders, which excludes purchased loans accounting adjustments, securities gains, merger and conversion costs, and foreclosed assets gains and losses, totaled $1.4 million in the fourth quarter of 2016 compared to $584 thousand in the fourth quarter of 2015.






About SmartFinancial, Inc. SmartFinancial, Inc., based in Knoxville, Tennessee, is the bank holding company for SmartBank. SmartBank is a full-service commercial bank founded in 2007, with twelve branches, two loan production offices, and one mortgage production office, all of which are located in East Tennessee, the Florida Panhandle, and North Georgia. Recruiting the best people, delivering exceptional client service, strategic branching and a conservative and disciplined approach to lending have all given rise to SmartBank’s success. More information about SmartFinancial can be found on its website: www.smartbank.com.

http://www.smartfinancialinc.com/Doc/Index?did=39066895

[norweger1979]

SmartBank enters into definitive agreement with Atlantic Capital Bank to acquire FSG Bank branch
59 minutes ago - DJNF

SmartBank enters into definitive agreement with Atlantic Capital Bank to acquire FSG Bank branch
KNOXVILLE, Tenn., Dec. 09, 2016 (GLOBE NEWSWIRE) -- SmartFinancial, Inc. ("SmartFinancial") (NASDAQ:SMBK), parent company of SmartBank, and Atlantic Capital Bancshares, Inc. ("Atlantic Capital") (NASDAQ:ACBI), parent company of Atlantic Capital Bank, N.A., announced today that SmartBank has signed a definitive agreement to acquire the Cleveland, Tennessee branch office and assets of FSG Bank, a division of Atlantic Capital Bank.

SmartBank has agreed to assume approximately $33,000,000 in customer deposits and purchase approximately $32,000,000 in loans and other assets affiliated with the Cleveland branch.

"This acquisition provides an incredible opportunity to expand our presence in Tennessee and introduce our brand and excellent client service to Bradley County," said SmartBank President and CEO, Billy Carroll. "Our expansion earlier this year into the Chattanooga market through the merger with Cornerstone Community Bank makes this FSG Bank branch acquisition in Cleveland a great strategic fit."

According to Atlantic Capital's President and Chief Operating Officer, Michael Kramer, "SmartBank brings a great understanding and knowledge of the East Tennessee community markets to our Cleveland client base. Our clients have come to expect a 'hands-on, high touch' approach, and we are confident that SmartBank will deliver that same level of service to the market."

The sale and acquisition of this branch will steer both Atlantic Capital Bank and SmartBank toward their goals of becoming banking leaders in the Southeast.

"This transaction will better position Atlantic Capital to continue to focus on our strategic objective of becoming a premier corporate, business and private bank serving metropolitan areas throughout the Southeast," said Douglas Williams, Chief Executive Officer of Atlantic Capital.

SmartFinancial Chairman Miller Welborn added, "Seizing smart growth opportunities like this will help get us one step closer to becoming the Southeast's next, great community banking franchise."

The acquisition, which is subject to customary closing conditions, including the receipt of all necessary regulatory approvals, is expected to be completed in the first quarter of 2017.

Advisors in Transaction

Troutman Sanders LLP provided legal counsel to Atlantic Capital Bank. Butler Snow LLP provided legal counsel to SmartBank.

About SmartFinancial, Inc.

SmartFinancial, Inc., with assets of $1.0 billion, is a publicly-traded bank holding company for SmartBank, based in Knoxville, Tennessee. SmartBank is a full-service commercial bank founded in 2007, with twelve branches and three loan production offices spanning East Tennessee and the Florida Panhandle. Recruiting the best people, delivering exceptional client service, strategic branching and a disciplined approach to lending have contributed to SmartBank's success. More information about SmartFinancial can be found on its website: www.smartbank.com.

About Atlantic Capital Bancshares, Inc.

Atlantic Capital Bancshares, Inc., with assets of $2.8 billion, is a publicly-traded bank holding company headquartered in Atlanta, Georgia with corporate offices in Chattanooga and Knoxville, Tennessee. Operating under the "Atlantic Capital" brand in Atlanta and "FSG Bank" brand in East Tennessee and Northwest Georgia, the company provides lending, treasury management and capital markets services to small and mid-sized businesses. The company's banking offices also provide mortgage, trust and other banking services to private and individual clients.

SmartFinancial, Inc. Media Contact

C. Bryan Johnson

Executive Vice President

Chief Financial Officer

Email: [e-mail]

Phone: [phone]



SmartBank Media Contact

Kelley Fowler

Senior Vice President

Public Relations/Marketing

Email: [e-mail]

Phone: [phone]



Atlantic Capital Bancshares, Inc. Contact

Anita Hill

Executive Vice President

Corporate Communications

Email: [e-mail]

Phone: [phone]

(MORE TO FOLLOW) Dow Jones Newswires

December 09, 2016 08:00 ET (13:00 GMT)

[norweger1979]

SmartFinancial Reports Third Quarter Results 2016

SmartFinancial, Inc. ("SmartFinancial"); (NASDAQ:SMBK), announced today net income of $1.6 million in its third quarter of 2016, compared to $(0.1) million a year ago. In the third quarter 2015, SmartFinancial successfully completed the merger of two holding companies, legacy SmartFinancial, Inc. and Cornerstone Bancshares, Inc., and carried forward the name "SmartFinancial, Inc." In the first quarter of 2016, SmartFinancial completed the merger of Cornerstone Community Bank with and into SmartBank. This quarter completes the fourth full quarter’s results from the combined company and the second full quarter's results of the merged bank.


Billy Carroll, President & CEO, stated: "We are pleased to see the hard work of our associates materialize in the form of improved results for our shareholders with increases in earnings per share, return on equity and return on assets this quarter. Loan growth was over 12 percent annualized, which was the second quarter it grew at a double digit pace. Our non-interest income is improving thanks to the results from our mortgage business and higher deposit service charges driven by balance growth. Our non interest expense reduction was primarily due to merger efficiencies. We are excited to put our merger expenses behind us and concentrate on the successful execution of our 2016 goals.”


SmartFinancial's Chairman, Miller Welborn, concluded: "It is exciting to see the internal achievements we have made as a company translate into improved external results. To be able to grow while maintaining a strong margin, improving asset quality, and increasing efficiencies is a testament to leadership at all levels of our company. Every day we strive to achieve our goals of being a best place to work, a great place to bank and especially rewarding for our shareholders."

Performance Highlights
•Net income available to common shareholders totaled $1.3 million or $0.23 per share during the third quarter of 2016.

•Annualized return on average assets equaled 0.63 percent in the third quarter of 2016, compared to 0.48 percent in the previous quarter.

•Annualized net loan growth was approximately 12.42 percent in the third quarter of 2016, with a healthy mix of construction & development, residential real estate, and commercial real estate loan growth.

•Asset quality was outstanding with nonperforming assets to total assets dropping to just 0.41 percent.

•Non interest income as a percent of average assets increased to 0.47 percent as the sale of mortgage and SBA loans increased over 45 percent.


Third Quarter 2016 compared to Second Quarter 2016


Net operating earnings available to common shareholders, which excludes purchased loans accounting adjustments, securities gains, merger and conversion costs, and foreclosed assets gains and losses, totaled $1,131 thousand in the third quarter of 2016 compared to $634 thousand in the previous quarter. Net income available to common shareholders totaled $1.3 million in the third quarter of 2016, or $0.22 per diluted share, compared to $0.9 million, or $0.15 per diluted share, in the second quarter of 2016.


Net interest income to average assets of 3.79 percent for the quarter decreased from 3.87 percent in the second quarter of 2016. Net interest income totaled $9.7 million in the third quarter of 2016 compared to $9.6 million in the second quarter of 2016. Net interest income was positively impacted during the quarter by increased loan balances. Net interest margin, taxable equivalent, fell slightly from 4.11 percent in the second quarter of 2016 to 4.03 percent in the third quarter of 2016 primarily as a result of a reduction in purchased loan accounting adjustments and lower balances and yields in the securities portfolio.


Provision for loan losses was $261 thousand in the third quarter of 2016, compared to $218 thousand in the second quarter of 2016. The increase in provision for loan losses was primarily due to the growth of the loan portfolio during the quarter. Annualized net charge-offs remained the same at 0.01 percent of average loans in the second third quarter of 2016.


The ALLL was $5.0 million, or 0.62 percent of total loans as of September 30, 2016, compared to $4.7 million, or 0.61 percent of total loans, as of June 30, 2016. Adjusted ALLL, which includes the ALLL as well as net acquisition accounting fair value adjustments for acquired loans, was 1.93 percent of total loans as of September 30, 2016, which was down from 2.00 percent as of June 30, 2016. The reduction in adjusted ALLL resulted from continued accretion of fair value discounts.


Nonperforming loans as a percentage of total loans was 0.21 percent as of September 30, 2016, which was down from 0.29 percent in the prior quarter. Total nonperforming assets (which include nonaccrual loans, loans past due 90 days or more and still accruing, and foreclosed assets) as a percentage of total assets was 0.41 percent as of September 30, 2016, compared to 0.69 percent as of June 30, 2016.


Non-interest income to average assets of 0.47 percent for the quarter increased from 0.39 percent in the second quarter of 2016. Non-interest income totaled $1.2 million in the third quarter of 2016, compared to $961 thousand in the second quarter of 2016. The increase in non-interest income was primarily due to higher service charges and fees, higher gains on the sale of SBA and mortgage loans, and gains on sale of foreclosed assets.


Non-interest expense to average assets of 3.16 percent for the quarter was down from 3.41 percent in the second quarter of 2016. Non-interest expense totaled $8.0 million in the third quarter of 2016, which was down $422 thousand from the second quarter of 2016 primarily due to normalized post merger data processing costs, the completion of repairs at one branch, and a drop in salary and employee benefit expenses. Occupancy expense of $965 thousand was down $172 thousand from the previous quarter due to the completion of a repair project at one branch. Data processing expenses decreased $98 thousand compared to the second quarter in the absence of merger related costs.


Income tax expense was $947 thousand in the third quarter of 2016 compared to $691 thousand in the second quarter of 2016. The company's effective tax rate was 37.02 percent in the third quarter of 2016 compared to 36.71 percent in the second quarter of 2016.


Third Quarter 2016 compared to Third Quarter 2015


Net operating earnings available to common shareholders, which excludes purchased loans accounting adjustments, securities gains, merger and conversion costs, and foreclosed assets gains and losses, totaled $1.1 million in the third quarter of 2016 compared to $154 thousand in the third quarter of 2015. Net income available to common shareholders totaled $1.3 million in the third quarter of 2016, or $0.22 per diluted share, compared to $(107) thousand, or $(0.03) per diluted share, in the third quarter of 2015. The company's operations and financial performance were significantly impacted in nearly every respect by the merger of SmartFinancial, Inc. and Cornerstone Bancshares, Inc. on August 31, 2015. Therefore, financial results in 3Q 2016 are not comparable to results reported for 3Q 2015.

[norweger1979]

SMBK

Insider (Director) buys 1,000 shares (3cents below 52week high)@$18.47

:)

[EXBX]

Weeeeee!
Up 1,298,601.25%!

[Renee]

SMBK one for 4 reverse split:

http://otce.finra.org/DLSymbolNameChanges

[mc6102]

SMBK on Daily List for R/S

09/22/2015 00:00:00 Reverse Split/CUSIP Change 09/23/2015 00:00:00 SMBK SmartFinancial, Inc. Common Stock Other OTC

http://otce.finra.org/DailyList

[Renee]

Cornerstone Bancshares Inc., CSBQ, changed to SmartFinancial Inc., SMBK:

http://otce.finra.org/DLSymbolNameChanges

[56Chevy]

Bank merger creates East Tennessee's biggest locally owned bank

September 2nd, 2015

Since he joined the board of Cornerstone Bancshares Inc. six years ago, Miller Welborn has worked to help navigate the Chattanooga bank through the storms of the Great Recession, often under the watchful eye of federal regulators who placed additional oversight on Cornerstone following several years of losses.

But with the bank profitable again for the past couple of years and with a stronger capital footing, Cornerstone merged Tuesday with the Knoxville-based SmartFinancial Inc., to create the largest bank holding company based in East Tennessee. The combined bank has a relatively clean balance sheet, nearly $1 billion in assets and a market capital of nearly $95 million in a more liquid stock.

"After playing defense for six years, we're ready to play offense again," said Welborn, the new chairman of SmartFinancial Inc. "We think we're hitting the starting line at a pretty good jogging pace and we're in the best part of the country, we believe, for future growth."

Cornerstone Bank, the sixth largest bank in metro Chattanooga with five offices in Hamilton County, plus a loan production office in Dalton, Ga., will combine with Smart Bank in the first quarter of 2016. SmartBank operates five branches in Sevier and Knox counties in East Tennessee, plus a couple of locations in the Panhandle of Florida.

For now, Cornerstone and SmartBank will operate as separate banks under a common bank holding company.

"This is a true merger of equals which will allow us to retain our existing talented team, build on our combined strengths, shared values and culture, while operating more efficiently for the benefit of shareholders," said Billy Carroll, the CEO of SmartFinancial.

Carroll, who father Bill previously operated Citizens National Bank in Sevierville, started SmartBank in 2007. With the addition of a couple of branches acquired from a bank failure in Florida in 2010, Carroll has grown the Knoxville-based bank to more than $500 million in assets through the recession and its aftermath. The Florida bank operations alone in the past five years have grown assets by nearly $80 million.

"We're in a sweet spot for banking," Carroll said. "We're small enough to make credit decisions quickly in local markets by local people, but we also have the horsepower to do about any deal that you want to do."

At age 47, Carroll says he is eager to grow SmartBank, both organically and with acquisitions of other community banks in the Southeast.

"Bank is an old school business that is never going away, but often it is slow moving and cumbersome — but it doesn't have to be," Welborn said. "As we transform into a more dynamic and innovative bank, we will be better positioned to grow with our strong Southeastern markets."

To help cut the bank's cost of capital, Cornerstone's preferred stock that previously paid a 10 percent annual coupon was replaced with the sale this summer of $15 million of additional common stock. The company expects the new stock, which will trade under the symbol SMBK, will soon be added to the Nasdaq stock exchange to provide more liquidity and opportunities for future bank purchases involving stock, as well as cash.

The lower cost of capital, combined with cost advantages of combining the two banks, should help boost the bank's profits.

For now, Welborn said he expects to retain all of the bank staff, at least initially, and to soon add credit officers. The bank also plans to move into residential lending with an expanded effort to market mortgages, both for its own portfolio and to sell in the secondary market, Carroll said.

The merger of Cornerstone and SmartBank is one of four such bank combinations this year among Chattanooga's four biggest independent banks.

CapitalMark Bank merged last month with Pinnacle Bank in Nashville; FSG is preparing to combine with Atlantic Capital Bancshares by the end of the year, and FirstBank is buying Northwest Georgia Bank.

http://www.timesfreepress.com/news/business/aroundregion/story/2015/sep/02/bank-merger-creates-east-tennessees-biggest-l/323011/

Marker:
Cornerstone Bancshar (CSBQ)
$3.85 0.0 (0.00%)
Volume: 3,900

*This is the merger of 2 mediocre banks. Misery loves company but if all goes well, as hoped by both parties, the merger should produce better results than these banks were capable of generating on their own.

[56Chevy]

*Stock is currently selling at a 10% discount to BV.

And the reason it sells at a discount is because earnings continue their unimpressive ways. This bank is going nowhere fast. .01 EPS for the 1st Qtr is nothing to write home about.

ROA and ROE are considerably below the national average for banks of this size.

[56Chevy]

Cornerstone Bancshares, Inc. Reports Positive Earnings for First Quarter of 2015

Date : 04/28/2015 @ 8:00AM
Source : PR Newswire (US)
Stock : Cornerstone Bancshares (PC) (CSBQ)
Quote : $3.55 0.0 (0.00%) @ 9:54AM

CHATTANOOGA, Tenn., April 28, 2015 /PRNewswire/ -- Cornerstone Bancshares, Inc. ("Cornerstone"; OTCBB: CSBQ; CSBQP), parent company of Cornerstone Community Bank ("Bank"), today reported net income of approximately $480,000 for the first quarter of 2015, compared with approximately $412,000 for the same quarter last year. This marks the seventeenth consecutive quarter of positive earnings for Cornerstone.

[....]

Book Value: $3.91

[....]

ROA: 0.46% ...for Q1 2014: 0.39%

ROE: 4.71% ...for Q1 2014: 4.08%

NIM: 3.98% ...for Q1 2014: 3.90%

[....]

http://ih.advfn.com/p.php?pid=nmona&article=66768739

*Stock is currently selling at a 10% discount to BV.

Marker:
Cornerstone Bancshar (CSBQ)
$3.55 0.0 (0.00%)
Volume: 0

[norweger1979]

CSBQ $3.45

insider buying

http://www.secform4.com/insider-trading/1038773.htm

[Enterprising Investor]

My preference is to own the target.

It provides me with the opportunity to buy the acquirer at a discount. However, the price can remain stuck for some time, but this no different to participating in the a rights offering.

Sorry for the delay in responding. I just saw your post today.

[norweger1979]

SmartBank stats


Comprehensive Financial Report for SmartBank

Financial Snapshot:
as of September 30, 2014


Dollar figures in thousands (000's)

Total Assets:
$535,377

Total Deposits:
$474,262


Domestic Deposits:
$474,262

Bank Equity Capital:
$54,398



Year-To-Date:


Net Income:
$1,560

Return on Assets:
0.41%

Return on Equity:
3.91%

Pre-tax Return on Assets:
0.65%


Quarterly:


Net Income:
$787

Return on Assets:
0.61%

Return on Equity:
5.83%

Pre-tax Return on Assets:
0.95%

http://research.fdic.gov/bankfind/detail.html?bank=58463&name=SmartBank&searchName=SMARTBANK&searchFdic=&city=&state=&zip=&address=&searchWithin=&activeFlag=&tabId=1

[norweger1979]

EI, do you have an opinion on the following?

Hold or Sell CSBQ?

Is this a way for SmartFinancial holders to cash out, since I believe this is a private company? Will this create selling pressure?

Or is this an attractive way for CSBQ investors to gain the opportunity to own a prior private company SmartFinacial?

I would appreciate any opinion, thanks

[Enterprising Investor]

SmartFinancial and Cornerstone Bancshares to Merge (12/08/14)

Partnership Creates Premier Banking Franchise in Strong Southeastern Markets

PIGEON FORGE, Tenn. and CHATTANOOGA, Tenn., Dec. 8, 2014 /PRNewswire/ -- SmartFinancial, Inc. ("SmartFinancial"), parent company of SmartBank, and Cornerstone Bancshares, Inc. ("Cornerstone") (OTCBB: CSBQ, CSBQP), parent company of Cornerstone Community Bank, jointly announced today the signing of a definitive agreement to merge, creating a combined company that will operate under the name SmartFinancial, Inc. While the two holding companies will be combined, the banks will initially remain independent and continue to operate under their respective names in their respective markets. The company plans to merge the banks in the future, combining them under the SmartBank name. Headquartered in Pigeon Forge, TN, SmartBank operates seven branch locations throughout East Tennessee and Northwest Florida. Based in Chattanooga, TN, Cornerstone Community Bank currently has five branch locations throughout the Chattanooga MSA.

On a pro forma basis, based on financial results as of September 30, 2014, the combined holding company would have approximately $945 million in total assets, $790 million in total deposits and $650 million in total loans, with 13 branch locations in the East Tennessee and the Florida Panhandle markets. After the banks are merged, the combined bank is expected to become the twelfth largest bank chartered in Tennessee.

"I am very excited to announce this new partnership and merger of equals," said Cornerstone's Chairman Miller Welborn, who will serve as Chairman of the combined company. "There are a lot of natural synergies between our two organizations, which made this partnership so attractive. Our institutions share similar cultures, core values and goals," he said. "We believe our complementary strengths will allow us to better serve our clients and communities, while our expanded footprint will position us favorably for future growth opportunities."

"This partnership is a natural fit," echoed SmartFinancial's President and CEO Billy Carroll. "Cornerstone has a solid reputation as one of the leading commercial lenders and most respected financial institutions in the booming Chattanooga market. SmartBank is a rapidly growing bank that has created a sound business model, dynamic culture and exceptional client service," he said. "Joining the two outstanding organizations will only strengthen both banks' positions and add greater value to all of our stakeholders."

Under the terms of the agreement, each outstanding share of common stock of SmartFinancial will be converted into 4.20 shares of Cornerstone common stock, subject to adjustment based on an anticipated reverse stock split of Cornerstone's common stock, which is expected to adjust the ratio to 1.05 shares of Cornerstone common stock for each share of SmartFinancial stock. Additionally, each outstanding share of SmartFinancial preferred stock will be converted into a share of Cornerstone preferred stock with similar rights and preferences. Current holders of Cornerstone's preferred stock will be asked to vote on an amendment to Cornerstone's charter to allow Cornerstone to redeem its outstanding preferred stock prior to the completion of the merger.

The definitive agreement has been unanimously approved by the boards of directors of SmartFinancial and Cornerstone. The merger is subject to regulatory approvals, approval by both companies' shareholders, and certain other closing conditions, and is expected to close in the first half of 2015.

The surviving company's board will include the current seven members of the SmartFinancial board and four current members of the Cornerstone board, under the following leadership structure: Miller Welborn, Chairman; Bill Carroll, Vice-Chairman; and Billy Carroll, President and Chief Executive Officer.

Advisors in Transaction

SmartFinancial was advised by Hovde Financial and the law firm of Butler Snow LLP. Cornerstone was advised by Raymond James & Associates, Inc. and the law firm of Miller & Martin PLLC.

About SmartFinancial, Inc.

SmartFinancial, Inc. is a single-bank holding company based in Pigeon Forge, Tennessee that operates SmartBank, a full-service commercial bank founded in 2007, with seven branches throughout East Tennessee and the Florida Panhandle. Recruiting the best people, delivering exceptional client service, strategic branching and a conservative and disciplined approach to lending have all given rise to SmartBank's success. More information about SmartFinancial can be found on its website: www.smartbank.com.

About Cornerstone Bancshares, Inc.

Cornerstone Bancshares, Inc. (OTCBB: CSBQ, CSBQP) is a single-bank holding company based in Chattanooga, Tennessee that operates Cornerstone Community Bank, a full-service commercial bank founded in 1996, with five branches throughout the Chattanooga MSA and one loan production office in Dalton, Georgia. Cornerstone specializes in providing customized financial solutions for businesses and consumers, by offering a comprehensive range of products and services designed to help companies and individuals build strong financial foundations. More information about Cornerstone can be found on its website: www.cscbank.com.

Important Information for Shareholders

This communication shall not constitute an offer to sell, the solicitation of an offer to sell, the solicitation of an offer to buy any securities or the solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. In connection with the proposed merger, Cornerstone will file a registration statement on Form S-4 with the Securities and Exchange Commission, which will contain the joint proxy statement/prospectus of SmartFinancial and Cornerstone. Shareholders of Cornerstone and SmartFinancial are encouraged to read the registration statement, including the joint proxy statement/prospectus that will be part of the registration statement, because it will contain important information about the merger, Cornerstone and SmartFinancial. After the registration statement is filed with the SEC, the joint proxy statement/prospectus and other relevant documents will be mailed to all Cornerstone and SmartFinancial shareholders and will be available for free on the SEC's website (www.sec.gov). The joint proxy statement/prospectus will also be made available for free by contacting the President and CEO of SmartFinancial at [phone] or the President and CEO of Cornerstone at 423-385-3009. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

Cornerstone, SmartFinancial and their respective directors, executive officers, and certain other members of management and employees of Cornerstone and SmartFinancial may be deemed to be participants in the solicitation of proxies in connection with the proposed merger. Information concerning the interests of the persons who may be considered "participants" in the solicitation will be set forth in the joint proxy statement/prospectus relating to the merger and the other relevant documents filed with the SEC when they become available. Information about the directors and executive officers of Cornerstone is also set forth in Cornerstone's proxy statement for its 2014 annual meeting of shareholders and its Annual Report on Form 10-K for the year ended December 31, 2013, filed with the SEC.

http://www.prnewswire.com/news-releases/smartfinancial-and-cornerstone-bancshares-to-merge-300005751.html

[Enterprising Investor]

Tangible Book Value is $3.84.

The preferred stock remains a better investment absent a takeover or redemption.

[norweger1979]

story continues

Preferred dividends still eating up all profits, but little CSBQ is trucking along, improving loan quality and cleaning up troubled assets.

Book value $3.80s

good luck

[norweger1979]

Cornerstone Bancshares, Inc. Reports Positive Earnings for Third Quarter of 2014


Print

CHATTANOOGA, Tenn., Oct. 27, 2014 /PRNewswire/ -- Cornerstone Bancshares, Inc. ("Cornerstone"; OTC Bulletin Board: CSBQ; CSBQP), holding company of Cornerstone Community Bank ("Bank"), today announced net income of approximately $406,000 for the third quarter of 2014. This marks the fifteenth consecutive quarter of positive earnings for Cornerstone.

Some financial highlights for the year as of September 30, 2014, compared with the same period of 2013, include:
•5% increase in total loans
•26.3% reduction in foreclosed assets
•12.1% reduction in non-accruing loans
•22.4% increase in market value per common share

"We continue to make steady, gradual progress in cleaning up the balance sheet," said Cornerstone's President and Chief Executive Officer Frank Hughes. "With a material reduction in foreclosed and non-performing assets, we are finally able to focus more of our time, energy and efforts on the production side of growing loans and deposits."

Cornerstone's common stock had a significant gain in market value at quarter end, from $2.45 per share as of September 30, 2013, to $3.00 per share as of September 30, 2014. In addition, Cornerstone continued paying its quarterly Preferred Stock dividend, based on positive earnings in preceding quarters. The most recent payment, made on August 26, 2014, marked the fourteenth consecutive quarterly dividend payment since the security was issued in the third quarter of 2010.

"This community has demonstrated its belief in and support of a strong community bank," said Cornerstone's Chairman Miller Welborn. "Just as Chattanooga continues to grow and thrive, Cornerstone is poised and ready to grow right along with the market."

Founded in 1996, Cornerstone is a single-bank holding company, with approximately $413 million in assets, serving the Chattanooga, Tennessee MSA, with five full-service branch locations throughout Chattanooga and one loan production office in Dalton, Georgia. Locally owned and operated, Cornerstone specializes in providing a comprehensive range of customized financial solutions for businesses and individuals.

Certain of the statements made in this release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements, including statements regarding the intent, belief or current expectations of Cornerstone and its management regarding the company's strategic directions, prospects and future results, involve certain risks and uncertainties. Certain factors may cause actual results to differ materially from those contained in the forward-looking statements, including economic and other conditions in the markets in which Cornerstone operates, governmental regulations, the company's competitive environment, cyclical and seasonal fluctuations in its operating results, and other risks.

[norweger1979]

CSBQ to present at Invest Tennessee Equity Conference on September 18, 2014.

http://www.invest-tn.com/companies.html?id=2167

company presentation in current 8k filing

[norweger1979]

new 52week high $2.85

after a couple high volume days/trades last couple trading sessions (volume before price) :)