Exhibit 99.1
CoBiz Inc. Reports First Quarter 2007 Results
Denver — CoBiz Inc. (Nasdaq: COBZ), a financial services holding company with $2.1 billion in assets, reported first quarter 2007 diluted EPS of $0.24, compared to $0.23 diluted EPS a year ago. Net income was $5.88 million in the first quarter versus $5.28 million one year ago, an increase of 11.4%. Return on average assets improved to 1.13% during the current quarter versus 1.09% a year earlier, while return on average equity was 13.19% for the current quarter versus 15.42% a year earlier. First quarter 2007 diluted EPS and return on average equity were both affected by the 975,000 shares issued in the secondary stock offering CoBiz completed during January.
First Quarter 2007 Highlights
(Compared with one year ago)
· Net interest income grew 11.4%
· Net margin expanded by 14 basis points (0.14%)
· Average loans and deposits increased 14.0% and 9.4%, respectively
· Credit quality remains strong with 0.20% nonperforming assets to total assets
“Due to the seasonality of all of our businesses, the first quarter is typically soft and this quarter was no exception” said Chairman and CEO Steve Bangert. “However, our pipeline of business, particularly on the loan side of the balance sheet and within our investment banking unit, are encouraging and should provide a favorable improvement to earnings for the remainder of 2007.”
Net Interest Income & Margin
Net interest income for the first quarter of 2007 increased to $21.0 million, up $2.2 million or 11.4% versus the first quarter of 2006. The net interest margin increased 14 basis points (0.14%) compared to first quarter of 2006 and increased 16 basis points (0.16%) versus the fourth quarter of 2006.
“I am very pleased by our ability to expand our margin in the face of an inverted yield curve and continued competitive pressure on both sides of the balance sheet,” said Bangert. “We have made a concerted effort to maintain discipline in our loan and deposit pricing and continue to maintain our conservative credit culture by not chasing higher-risk, lower-yielding assets.”
Noninterest Income
Noninterest income for the first quarter of 2007 increased to $6.6 million, up from $6.3 million in the first quarter of 2006. As a percentage of total operating revenue, noninterest income decreased slightly to 24.0% in the first quarter of this year compared to 25.2% in the first quarter of 2006.
The Investment Advisory & Trust segment had a strong first quarter with revenue increasing 24.3% on an annualized basis from the fourth quarter of 2006. “The hiring in
January of Ross Thompson and Gordan Post to lead our trust department has already resulted in substantial new business for CoBiz,” stated Bangert. “Ross and Gordan have a tremendous reputation and following within the Colorado business community and have really just begun to make their mark on our company’s trust department which has been renamed CoBiz Trust.”
Operating Expenses
Operating expenses increased $1.8 million or 10.7% versus the first quarter of 2006. The majority of the increase was in salaries and employee benefits, which increased 12.1% from the first quarter of 2006. The variance is due in part to higher staffing levels to accommodate our growth and annual merit increases awarded as of January 1, 2007. As of March 31, 2007, the Company employed 468 full-time-equivalent employees, compared to 444 at March 2006. The Company made significant progress in the recruitment of business development officers in the latter half of 2006, increasing compensation expense though the beneficial revenue impact has yet to be fully realized.
Also reflected in the increase in operating expenses were costs related to the company’s branding efforts. The company has completely redesigned all corporate logos and marketing materials to better unify its complete product offering. In addition, the company will be changing its name – pending shareholder approval at the 2006 Annual Meeting in May – to CoBiz Financial.
The efficiency ratio increased slightly from 65.9% in the first quarter of 2006 to 66.4% in the first quarter of 2007.
Loans and Deposits
Average loan balances were $1.56 billion during the quarter, an increase of $191.7 million or 14.0% over balances of $1.37 billion one year ago. Average deposit balances were $1.43 billion during the quarter, an increase of $122.9 million or 9.4% over balances of $1.31 billion one year ago.
“In addition to a good pipeline of loan activity, we are also making inroads on attracting higher-profile, larger-dollar deposit relationships,” commented Bangert. “For example, at the end of the first quarter our Denver bank successfully attracted an eight-figure deposit relationship from one of the largest non-profit entities in Colorado. By offering a suite of products including bank deposits, treasury management services, and fixed-income solutions through our investment management subsidiary, we were able to offer this prospect a seamless cash management solution on-par with the large regional banks while providing the high-touch, customized service that CoBiz has become known for.”
Credit Quality
Nonperforming assets to total assets increased to 20 basis points (0.20%) during the first quarter 2007, up from prior year’s level of four basis points (0.04%). Nonperforming loans to total loans ended the quarter at 27 basis points (0.27%), compared to six basis
points (0.06%) at the end of first quarter 2006. The allowance for loan and credit losses equaled over four times the level of nonperforming assets at quarter-end. The allowance for loan and credit losses increased to $18.7 million at quarter-end, up $1.4 million from $17.3 million at the end of first quarter 2006.
Earnings Conference Call
In conjunction with this earnings release, you are invited to listen to the company’s conference call on Friday, April 20, 2007 at 11:00 am ET with Steve Bangert, CoBiz chairman and CEO. The call can be accessed via the Internet at http://www.videonewswire.com/event.asp?id=38744 or by telephone at (866) 425-6195 (conference ID #8628506).
Annual Meeting
This year’s annual meeting of shareholders will be held at the Magnolia Ballroom, 817 17th Street, Denver, Colorado 80202 on May 17, 2007 at 8:00 a.m. M.D.T. You are cordially invited to attend.
Contact Information
CoBiz Inc.
Lyne Andrich 303.312.3458
Sue Hermann 303.312.3488
About CoBiz Inc.
CoBiz Inc. (www.cobizinc.com) is a $2.1 billion financial holding company headquartered in Denver. The company operates Colorado Business Bank and Arizona Business Bank, full-service commercial banking institutions that offer a broad range of sophisticated banking services — including credit, treasury management, investment and deposit products — to a targeted customer base of professionals and small to mid-sized businesses. CoBiz also offers trust and fiduciary services through CoBiz Trust; property and casualty insurance brokerage and risk management consulting services through CoBiz Insurance; investment banking services through Green Manning & Bunch; the management of stock and bond portfolios for individuals and institutions through Alexander Capital Management Group; and employee and executive benefits consulting and wealth transfer services through Financial Designs, Ltd.
Forward-looking Information
This release contains forward-looking statements that describe CoBiz’s future plans, strategies and expectations. All forward-looking statements are based on assumptions and involve risks and uncertainties, many of which are beyond our control and which may cause our actual results, performance or achievements to differ materially from the results, performance or achievements contemplated by the forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to
historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Forward-looking statements speak only as of the date they are made. Such risks and uncertainties include, among other things:
· Risks and uncertainties described in our reports filed with the Securities and Exchange Commission, including our most recent 10-K.
· Competitive pressures among depository and other financial institutions nationally and in our market areas may increase significantly.
· Adverse changes in the economy or business conditions, either nationally or in our market areas, could increase credit-related losses and expenses and/or limit growth.
· Increases in defaults by borrowers and other delinquencies could result in increases in our provision for losses on loans and leases and related expenses.
· Our inability to manage growth effectively, including the successful expansion of our customer support, administrative infrastructure and internal management systems, could adversely affect our results of operations and prospects.
· Fluctuations in interest rates and market prices could reduce our net interest margin and asset valuations and increase our expenses.
· The consequences of continued bank acquisitions and mergers in our market areas, resulting in fewer but much larger and financially stronger competitors, could increase competition for financial services to our detriment.
· Our continued growth will depend in part on our ability to enter new markets successfully and capitalize on other growth opportunities.
· Changes in legislative or regulatory requirements applicable to us and our subsidiaries could increase costs, limit certain operations and adversely affect results of operations.
· Changes in tax requirements, including tax rate changes, new tax laws and revised tax law interpretations may increase our tax expense or adversely affect our customers’ businesses.
In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements in this release. We undertake no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise.
