Cornerstone Bancshares, Inc., (“Cornerstone”; OTC Bulletin Board: CSBQ; CSBQP), holding company of Cornerstone Community Bank (“Bank”), on Wednesday announced net income of $364,000 for the third quarter of 2012. This marks the seventh consecutive quarter of positive earnings for Cornerstone and an increase from net income of $356,000 for the first quarter of 2012, and $311,000 for the second quarter of 2012.
Year-over-year, total net income for Cornerstone increased 12.4 percent at the end of the third quarter, from $917,000 in 2011 to $1,031,000 in 2012. Non-accruing loans decreased from $8.56 million in 2011 to $7.97 million in 2012. Net interest margin increased for the year from 3.51 percent in 2011 to 3.73 percent in 2012. In addition, the Bank’s total risk-based capital ratio increased 20.8 percent year-over-year at the end of the third quarter, from 11.12 percent in 2011 to an estimated 13.43 percent in 2012.
"We continue to make steady progress in the right direction," said Cornerstone's President and Chief Executive Officer Frank Hughes. “While we still have a ways to go, it’s nice that the regulators have also recognized our efforts and improvements made across the board.”
On Aug. 27, Cornerstone announced that the FDIC and Tennessee Department of Financial Institutions had officially terminated the Consent Order and Written Agreement entered into with the Bank on April 2, 2010, after loan losses sustained during the ‘Great Recession.” The regulatory agreement provided guidelines for the Bank to improve its capital ratios, loan portfolio and earnings. The release of the Consent Order and Written Agreement were major benchmarks for Cornerstone’s success in aggressively tackling its asset quality issues, cleaning up the balance sheet and raising in excess of $12 million in capital through a Preferred Stock Offering in the local market.
"Our customers, shareholders and members of the Chattanooga community have faithfully stood by Cornerstone and are truly vested in our success,” said Cornerstone's Chairman Miller Welborn. "We will continue to work diligently to serve the Chattanooga market as a premier community bank, and to deliver the greatest return on investment for all our shareholders.”
Founded in 1996, Cornerstone is a single-bank holding company, with $425 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 locally operated, Cornerstone specializes in providing a comprehensive range of customized financial solutions for businesses and individuals.