CONTRIBUTED

First Bancorp, the parent company of First Bank, has announced net income available to common shareholders of $2.5 million, or 15 cents per diluted common share, for the three months ended June 30.

That compared with $2.7 million, or 16 cents per diluted common share, recorded in the second quarter of 2011.

For the six months ended June 30, the company reported a net loss available to common shareholders of $3.5 million, or 21 cents per diluted common share, compared with net income of $8 million, or 48 cents per diluted common share, for the six months ended June 30, 2011.

The net loss reported for the first six months of 2012 was caused primarily by a higher provision for loan losses in the first quarter of 2012 related to non-covered loans, a news release said.

Also impacting comparability from 2011 to 2012 was a significant gain recorded by the company in 2011.

In the first quarter of 2011, the company realized a $10.2 million bargain purchase gain related to the acquisition of the Bank of Asheville in Asheville. The after-tax impact of this gain was $6.2 million, or 37 per diluted common share, the release said.

"I am pleased with the company's performance this quarter, including earnings of $2.5 million, growth in noncovered loans and low-cost deposits, and a strong net interest margin," said Richard H. Moore, president and CEO of First Bancorp. "We hope to build on this positive momentum in future quarters."

Net interest income for the second quarter of the year amounted to $33 million, a 4.4 percent decrease from the $34.5 million recorded in the second quarter of 2011. Net interest income for the six months ended June 30 amounted to $65 million, a 2.6 percent decrease from the $66.8 million recorded in the comparable period of 2011.

The company's net interest margin in the second quarter of the year was 4.68 percent, compared with the 4.92 percent margin in the second quarter of 2011. For the six-month period ended June 30, the company's net interest margin was 4.64 percent, compared with 4.77 percent for the same period in 2011.

The lower margins were primarily attributed to lower loan yields, as well as the mix of the company's earning assets being more concentrated in lower-yielding short-term investments, compared with a larger concentration of higher yielding loans and securities in 2011.

The company recorded total provisions for loan losses of $6.5 million in the second quarter of the year, compared with $10.9 million for the second quarter of 2011. For the six months ended June 30, the company recorded total provisions for loan losses of $28 million, compared with $22.3 million for the same period of 2011.

Total noninterest income for the three months ended June 30, 2012 and 2011 was $1.8 million and $5.1 million, respectively, a decrease of $3.3 million, or 65.4 percent, that was primarily attributable to losses and write-downs on foreclosed properties

For the six months ended June 30, 2012 and 2011, the company recorded noninterest income of $7.1 million and $19.3 million, respectively. The significant decrease in noninterest income for the six month period comparison is primarily the result of the $10.2 million bargain purchase gain recorded in the acquisition of the Bank of Asheville during the first quarter of 2011, the news release said.

The company continues to experience losses and write-downs on its foreclosed properties because of declining property values in its market area. For the second quarter of 2012, these losses amounted to $6.6 million for covered properties, compared with $2.6 million in the second quarter of 2011. For the first six months of the year, losses on covered properties amounted to $11.1 million, compared with $7.5 million for the same period in 2011.

Noninterest expenses amounted to $23.4 million in the second quarter of the year, a 2.3 percent increase from the $22.9 million recorded in the same period of 2011.

Noninterest expenses for the six months ended June 30, amounted to $47.8 million, a 0.3 percent decrease from the $48 million recorded in the first six months of 2011.

Personnel expense amounted to $13 million and $27 million for the three and six months ended June 30, 2012, respectively, compared with $12.6 million and $25.6 million for the same periods of 2011. The increase in personnel expense in 2012 is primarily associated with the hiring of additional employees in order to build the company's infrastructure, expand wealth management capabilities and prepare the company for future growth, the release said.

Total assets as of June 30, amounted to $3.3 billion, a 0.1 percent decrease from a year earlier. Total loans as of June 30 amounted to $2.4 billion, a 0.2 percent decrease from a year earlier, and total deposits amounted to $2.8 billion as of June 30, a 3.3 percent increase from a year earlier.

The company's level of noninterest bearing checking accounts amounted to $381.4 million as of June 30, an 18 percent increase from a year earlier, while interest-bearing checking accounts amounted to $472.3 million, an increase of 27.1 percent from a year earlier.

The company remains well-capitalized by all regulatory standards, with a total risk-based capital ratio as of June 30 of 16.23 percent, compared with the 10 percent minimum to be considered well-capitalized. basis points from a year earlier.

First Bancorp is a bank holding company headquartered in Troy. Its principal activity is the ownership and operation of First Bank, a state-chartered community bank that operates 98 branches - 82 in North Carolina, nine in South Carolina and seven in Virginia.

First Bank also has a loan production office in Blacksburg, Va.