The board of directors of Andrew Johnson Bank has declared a special dividend of $0.75 per share to shareholders of record at the end of the 2nd quarter, according to President and CEO James W. "Bill" Hickerson.

Andrew Johnson Bank last paid dividends in October 2010.

The bank earned $1,233,404 after taxes, or $4.49 per share, for the first six months of 2012, comparing favorably to the $2.52 per share that the bank earned during the first half of 2011, said CFO Bill Moskowitz in a news release.

"The increase in earnings for 2012 is a direct result of improved credit quality that caused fewer loan losses. Consequently, provisions for potential losses and costs for loan and collections have been eased," Moskowitz said.

"The increased profitability for the first six months of 2012 has improved the bank's Tier One Capital Ratio (the ratio most commonly used by regulators in assessing a bank's capital adequacy) from 8.71 percent at Dec. 31, 2011, to 8.93 percent at June 30, 2012," Hickerson said.

"By paying a dividend at mid-year," Hickerson added, "the board wanted to reward the shareholders for their patience and support during this unprecedented economic period and to also send a message of encouragement that the bank continues to improve its balance sheet and profitability as most measurements and ratios trend in a positive direction."

Hickerson said in the news release that the region will continue to face economic uncertainties, but he is confident that the bank's management has a strong foundation in place to meet the challenges.