It gives me great pleasure to comment about our positive 2015 financial results. The management team continues to make significant and meaningful progress improving the company’s balance sheet and earnings. In 2015, our total assets increased 15% and now stand at $685 million. This increase in total assets was largely driven by organic growth in loans of 15.1% and strong deposit growth of 13%. And for that reason, I would like to acknowledge a debt of gratitude to my entire team for a job well done. It is their hard work and dedication that have made 2015 an outstanding year for Sussex Bancorp.
Financial Performance & Shareholder Value
I am also pleased to report a 42.1% increase in net income per diluted common share to $0.81 for the year ended December 31, 2015, as compared to $0.57 for the same period last year. The improvement in 2015 was driven by our strong topline growth and contributions from our core lines of business.
Our relationship-based approach to banking enabled us to organically grow both our loan portfolio by 15% or $71 million, and our deposit base 13% or $60 million—which now stands at $518 million. We also applied that same relationship-based approach to our insurance subsidiary and increased its pre-tax income by 34% or $169,000. Those positive contributions kept our net interest margins stable and improved our fee income, thereby creating the favorable operating conditions that drove these financial results.
Our capital remains strong. Our leverage, Common Equity Tier I, Tier I and Total risk-based capital ratios were 9.45%, 11.74%, 11.74% and 12.79%, respectively, all in excess of ratios required to be considered a “well capitalized” bank.
Our year-over-year (2014 vs. 2015) stock price is up 28.3%. And, over a three year period from 2012 through 2015, our stock price grew an impressive 143.3%.
Expanding our geographic footprint is an important next phase of our strategic plan, and that process is well under way. Using our “growing responsibly” philosophy as a guide, avoiding undue risk and staying true to our disciplined credit culture, we will open new banking centers in strategically important markets where we can compete, grow market share and create shareholder value. These banking centers will feature our “integrated banking experience.” By integrating technology-based banking solutions with a staffing model that emphasizes higher value customer engagements, we are able to deliver a customer experience that better meets the needs of the 21st century customer. The alignment of both technology and human interactions integrated into our digital banking platform creates a seamless, unified and consistent customer experience.
We are also placing commercial lending teams in geographically important banking centers to improve customer interactions and build stronger personal relationships. These new initiatives are all intended to enhance our customers’ experience so we can grow our business by generating positive operating leverage, increase revenues and ultimately, shareholder value. In March 2015, we opened our first banking center in Astoria, NY, and within ten months of operation, the center turned profitable—exceeding our break-even projections by many months. And in the first quarter of 2016, we entered Bergen County, NJ and opened a new banking center in Oradell, NJ. We expect our banking centers and “integrated banking experience” will continue to fuel additional earnings growth.
Our Management Team and Employees
As Ed mentioned, this year we will be celebrating our 40th anniversary. Throughout our history, and more prominently in the last six years that I have been here, the one constant has been our management team and our employees—who have kept the customer at the center of everything we do. As active members of their communities, our employees recognize the critical role they play in improving the financial lives of their friends and neighbors. At the end of the day, personal relationships matter, and we think we do an outstanding job at connecting with our customers.
A History of Serving Customers and Communities
We demonstrate our commitment to philanthropy and our communities in several ways. We support events and causes through Sussex Bank on a corporate and local banking center level and through our own SB Foundation. In 2015 SB Foundation, Inc. proudly made donations to many local charities including—but not limited to— The Hemophilia Foundation, Karen Ann Quinlan Hospice, The Boys and Girls Club of Paterson, Bergen Chapter NJSCPA, Oasis—A Haven for Women and Children, Habitat for Humanity of Bergen County and Community Hope for Morris County. Additionally, our Foundation awarded scholarships to the Sussex County Community College Foundation, US Armed Forces Reservist Advantage Scholarship and the US Armed Forces College Start Scholarship. We are honored to help support these fine organizations and the great work they do in making our communities better places to live.
The Road Ahead
As we continue to evaluate the company’s performance and the environmental conditions impacting it, the management team will remain vigilant in ensuring that the decisions we make today will deliver high-quality and sustainable growth tomorrow. Though 2016 promises to be filled with challenges, I firmly believe that Sussex Bank has a solid plan and a high performing management team in place that will build the franchise and create long-term shareholder value. I would like to conclude by thanking the shareholders for their continued trust and confidence, as we remain committed to earning it every day.
President & CEO