Exhibit 99.1
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| FOR IMMEDIATE RELEASE | | April 28, 2005 |
Contacts: Merrill J. Forgotson, President/CEO or James P. Jakubek, EVP (203) 356-0111
Stamford, Connecticut: (AMEX: CBN)
CORNERSTONE BANCORP, INC. REPORTS RESULTS OF OPERATIONS FOR Q1 2005
Stamford, CT., April 28, 2005 – Merrill J. Forgotson, President and Chief Executive Officer of Cornerstone Bancorp, Inc. (the “Bancorp”), today reported consolidated net earnings for the Bancorp and its subsidiary, Cornerstone Bank (the “Bank”), for the first quarter of 2005.
On April 13, 2005 Cornerstone Bancorp announced it had signed a definitive agreement with NewAlliance Bancshares, Inc. (NYSE:NAL), pursuant to which, and subject to regulatory approvals and the approval of the shareholders of Cornerstone Bancorp, NewAlliance Bancshares will acquire all the outstanding shares of Cornerstone Bancorp, Inc., in a cash-and-stock transaction valued at approximately $48.7 million.
The total assets of Cornerstone Bancorp, Inc. increased to $232,647,000 on March 31, 2005 compared to $211,802,000 on December 31, 2004 an increase of 9.8%. Loans, including loans available for sale, increased to $137,758,000 on March 31, 2005 compared to $132,611,000 on December 31, 2004, an increase of 3.8%. Total deposits increased to $193,226,000 on March 31, 2005 from $177,127,000 on December 31, 2004, an increase of 9.0%. Book Value per common share increased to $18.20 on March 31, 2005 from $17.96 on December 31, 2004, an increase of 1.3%. Cornerstone Bancorp had 1,272,433 shares of common stock, net of treasury stock, outstanding as of March 31, 2005.
While the Bancorp’s net interest income for the first calendar quarter of 2005 amounted to $2,420,000 as compared with $2,105,000 for the first quarter 2004, net income for the same period was $372,000, compared to net income of $1,055,000 for the comparable three-month period of 2004. This represented $0.28 earnings per diluted share compared to $0.82 earnings per diluted share for the same period of 2004 and reflected the fact that income for the first calendar quarter of 2004 included significant non-recurring components.(1)
On February 25, 2005, the Board of Directors declared a quarterly cash dividend of $0.1125 per share. The cash dividend was paid on April 15, 2005 to stockholders of record as of the close of business on March 31, 2005.
In Connecticut, Cornerstone Bancorp, through its subsidiary Cornerstone Bank, operates from three full-service locations in Stamford, one full-service location in Greenwich, Norwalk and Westport. The Bancorp also operates one business development office in Norwalk and four limited service mobile branches. The Bancorp’s common stock is traded on the American Stock Exchange under the symbol CBN.
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Three Months Ended March 31,
| | 2005
| | 2004
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Total Interest Income | | $ | 3,017,000 | | $ | 2,752,000 | |
Net Interest Income | | | 2,420,000 | | | 2,105,000 | |
Provision for Loan Losses | | | 54,000 | | | (511,000 | ) |
Income Before Taxes | | | 614,000 | | | 1,435,000 | |
Income Tax Expense | | | 242,000 | | | 380,000 | |
Net Income | | | 372,000 | | | 1,055,000 | (1) |
Basic Earnings Per Share | | | 0.30 | | | 0.87 | |
Diluted Earnings Per Share | | | 0.28 | | | 0.82 | |
| (1) | The first quarter 2004 earnings include income of approximately $424,000 from the recovery of principal, interest, and late charges on loans to a single borrower that had been charged off in 2000. The recovery created a credit in the provision for loan losses for the quarter, which also included the recapture of provisions for classified loans that were paid off. In addition, non-taxable proceeds from a key man life insurance policy were received and recorded in the first quarter of 2004. The insurance proceeds, net of related increases in benefit accruals, resulted in income of approximately $342,000. The estimated after-tax effect of these two items is approximately $0.62 on a basic per share basis and $0.59 per share on a diluted basis for the first quarter of 2004. |
The statements contained in this press release that are not historical are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Examples of such forward-looking statements include, without limitation, statements regarding expectations for earnings, credit quality, and other financial and business matters. When used in this report, the words “anticipate,” “plan,” “believe,” “estimate,” “expect” and similar expressions as they relate to the Company or its management are intended to identify forward-looking statements. All forward-looking statements involve risks and uncertainties. Actual results may differ materially from those discussed in, or implied by, the forward-looking statements as a result of certain factors, including but not limited to, competitive pressures on loan and deposit product pricing; other actions of competitors; changes in economic conditions; technological changes; the extent and timing of actions of the Federal Reserve Board, including changes in monetary policies and interest rates; customer deposit disintermediation; changes in customers’ acceptance of the Bank’s products and services; and the extent and timing of legislative and regulatory actions and reforms.
The forward-looking statements contained in this report speak only as of the date on which such statements are made. By making any forward-looking statements, the Company assumes no duty to update them to reflect new, changing or unanticipated events or circumstances.
