Exhibit 99.63
Press Release
Available for Immediate Publication: October 24, 2008
First National Bank of Northern California Reports Third Quarter 2008 Earnings of $0.36 Per Diluted Share
Source: FNB Bancorp (CA) (Bulletin Board: FNBG)
South San Francisco, California
Website:www.fnbnorcal.com
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Contacts: |
Tom McGraw, Chief Executive Officer (650) 875-4864 |
Dave Curtis, Chief Financial Officer (650) 875-4862 |
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FNB Bancorp (Bulletin Board: FNBG), parent company of First National Bank of Northern California, today announced operating earnings for the third quarter of 2008 of $1,047,000 or $0.36 per diluted share, compared to $1,795,000 or $0.59 per diluted share for the third quarter of 2007. Total consolidated assets as of September 30, 2008 were $660,296,000 compared to $638,528,000 as of September 30, 2007.
Financial Highlights: Third quarter, 2008
Consolidated Statement of Earnings
(in ‘000s except earnings per share amounts)
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| Three |
| Three |
| Nine |
| Nine |
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Interest income |
| $ | 9,787 |
| $ | 10,881 |
| $ | 29,815 |
| $ | 31,439 |
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Interest expense |
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| 2,725 |
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| 3,531 |
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| 8,888 |
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| 10,046 |
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Net Interest Income |
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| 7,062 |
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| 7,350 |
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| 20,927 |
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| 21,393 |
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Provision for loan losses |
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| (300 | ) |
| (180 | ) |
| (1,590 | ) |
| (510 | ) |
Non-interest income |
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| 769 |
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| 1,093 |
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| 3,167 |
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| 3,239 |
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Non-interest expense |
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| 6,481 |
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| 5,761 |
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| 18,944 |
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| 17,327 |
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Income before income taxes |
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| 1,050 |
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| 2,502 |
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| 3,560 |
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| 6,795 |
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Provision for income taxes |
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| (3 | ) |
| (707 | ) |
| (536 | ) |
| (1,814 | ) |
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Net Earnings |
| $ | 1,047 |
| $ | 1,795 |
| $ | 3,024 |
| $ | 4,981 |
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Basic earnings per share |
| $ | 0.36 |
| $ | 0.60 |
| $ | 1.03 |
| $ | 1.66 |
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Diluted earnings per share |
| $ | 0.36 |
| $ | 0.59 |
| $ | 1.02 |
| $ | 1.64 |
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Average assets |
| $ | 661,328 |
| $ | 627,520 |
| $ | 655,178 |
| $ | 615,185 |
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Average equity |
| $ | 67,189 |
| $ | 64,940 |
| $ | 67,562 |
| $ | 63,745 |
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Return on average assets |
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| 0.63 | % |
| 1.14 | % |
| 0.62 | % |
| 1.08 | % |
Return on average equity |
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| 6.23 | % |
| 11.06 | % |
| 5.97 | % |
| 10.41 | % |
Efficiency ratio |
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| 83 | % |
| 68 | % |
| 79 | % |
| 70 | % |
Net interest margin |
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| 4.75 | % |
| 5.10 | % |
| 4.78 | % |
| 5.12 | % |
Average shares outstanding |
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| 2,909 |
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| 3,002 |
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| 2,947 |
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| 3,000 |
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Average diluted shares outstanding |
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| 2,919 |
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| 3,022 |
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| 2,973 |
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| 3,035 |
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Consolidated Balance Sheets
(In ‘000s)
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| As of |
| Year ended |
| As of |
| Year ended |
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Assets: |
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Cash and cash equivalents |
| $ | 17,873 |
| $ | 15,750 |
| $ | 17,264 |
| $ | 27,022 |
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Securities available for sale |
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| 104,489 |
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| 94,432 |
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| 91,127 |
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| 94,945 |
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Loans, net |
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| 489,644 |
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| 489,574 |
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| 486,127 |
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| 419,437 |
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Premises, equipment and |
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Leasehold improvements |
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| 13,378 |
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| 13,686 |
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| 13,604 |
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| 13,476 |
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Other real estate owned |
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| 3,819 |
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| 440 |
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| — |
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| — |
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Goodwill |
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| 1,841 |
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| 1,841 |
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| 1,841 |
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| 1,841 |
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Other assets |
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| 29,252 |
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| 28,742 |
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| 28,565 |
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| 24,549 |
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Total assets |
| $ | 660,296 |
| $ | 644,465 |
| $ | 638,528 |
| $ | 581,270 |
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Liabilities and stockholders’ equity: |
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Deposits: |
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Demand and NOW |
| $ | 184,014 |
| $ | 181,638 |
| $ | 179,627 |
| $ | 184,262 |
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Savings and money market |
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| 181,426 |
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| 181,276 |
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| 189,232 |
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| 162,915 |
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Time |
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| 155,030 |
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| 136,341 |
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| 138,154 |
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| 134,390 |
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Total deposits |
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| 520,470 |
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| 499,255 |
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| 507,013 |
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| 481,567 |
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Federal Home Loan Bank advances |
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| 66,000 |
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| 66,000 |
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| 45,000 |
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| 30,000 |
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Federal funds purchased |
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| — |
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| 5,595 |
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| 12,620 |
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| — |
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Accrued expenses and other liabilities |
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| 7,275 |
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| 7,070 |
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| 8,859 |
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| 7,640 |
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Total liabilities |
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| 593,745 |
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| 577,920 |
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| 573,492 |
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| 519,207 |
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Stockholders’ equity |
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| 66,551 |
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| 66,545 |
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| 65,036 |
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| 62,063 |
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Total liab. and stockholders’ equity |
| $ | 660,296 |
| $ | 644,465 |
| $ | 638,528 |
| $ | 581,270 |
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Other Financial Information: |
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Allowance for Loan Losses |
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| 6,031 |
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| 5,638 |
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| 5,502 |
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| 5,002 |
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Nonperforming Assets |
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| 15,694 |
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| 11,905 |
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| 11,253 |
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| 2,628 |
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Total Gross Loans |
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| 495,675 |
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| 495,212 |
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| 491,629 |
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| 424,439 |
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“Our third quarter, 2008, financial performance reflects management’s efforts to maintain our net interest margin while we continue to increase our allowance for loan losses,” stated Tom McGraw, Chief Executive Officer. During the third quarter of 2008, management recorded a provision for loan losses of $300,000 compared to $180,000 for the same period in 2007. For all of 2008, the provision for loan losses was $1,590,000, an increase of $1,080,000 when compared to 2007 levels. During 2008, our assets have grown by $15,831,000 or approximately 2% since December 31, 2007. Total deposits have increased by $21,215,000 or approximately 4% during 2008.
“Net charge-offs during the third quarter of 2008 totaled $69,000 compared to a net recovery of $13,000 during the same period in 2007. Management is committed to maintaining our allowance for loan losses at prudent levels. Our allowance for loan losses totaled 1.22% and 1.14% as of September 30, 2008 and December 31, 2007, respectively. While it is true we operate in a difficult credit environment and there are almost daily news reports detailing the economic problems we all face, First National Bank of Northern California has continued to stay profitable, paid consistent stockholder dividends and continued to lend and gather deposits locally. Management and the board of directors have demonstrated a commitment to providing our customers a safe, local banking experience for 45 years. We are the family bank, offering deposit and loan products for individuals, businesses large and small, and local non-profit organizations that serve our community,” added Tom McGraw. During 2008, the Company has dealt with a declining interest rate environment, yet was successful in increasing net interest margin by 4 basis points during the third quarter of 2008 when compared with the second.
“During the third quarter of 2008, the Federal Home Loan Mortgage Corporation (“Freddie Mac”) and the Federal National Mortgage Association (“Fannie Mae”) were placed into a government conservatorship. Prior to this action, First National Bank had a $500,000 investment in Freddie Mac equity securities and no investment in similar Fannie Mae securities. As a result of the government’s actions, we recorded an other than temporary impairment charge of $470,000 related to our Freddie Mac investment during the third quarter of 2008. Following the filing of the 2007 income tax return and the resulting reconciliation with our financial statements, we were able to record a $200,000 reduction in our third quarter 2008 income tax expense,” stated Tom McGraw.
The Bank is well capitalized and is guided by a seasoned board of directors and management team that has worked through difficult economic times in the past. For forty-five years, First National Bank of Northern California, the family bank, has been dedicated to providing our customers and their families, our communities, and our shareholders a safe and sound local banking institution they can rely upon.
Cautionary Statement: This release contains certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those stated herein. Management’s assumptions and projections are based on their anticipation of future events and actual performance may differ materially from those projected. Risks and uncertainties which could impact future financial performance include, among others, (a) competitive pressures in the banking industry; (b) changes in the interest rate environment; (c) general economic conditions, either nationally or regionally or locally, including fluctuations in real estate values; (d) changes in the regulatory environment; (e) changes in business conditions or the securities markets and inflation; (f) possible shortages of gas and electricity at utility companies operating in the State of California, and (g) the effects of terrorism, including the events of September 11, 2001, and thereafter, and the conduct of war on terrorism by the United States and its allies. Therefore, the information set forth herein, together with other information contained in the periodic reports filed by FNB Bancorp with the Securities and Exchange Commission, should be carefully considered when evaluating its business prospects. FNB Bancorp undertakes no obligation to update any forward-looking statements contained in this release.