Exhibit 99.1
PLACER SIERRA BANCSHARES
PRESS RELEASE
|
AUGUST 1, 2006
For more information contact:
AT THE COMPANY: | AT FINANCIAL RELATIONS BOARD: | |
Ronald W. Bachli, Chairman & CEO | Tony Rossi | |
David E. Hooston, Chief Financial Officer | (310) 854-8317 | |
(916) 554-4750 |
PLACER SIERRA BANCSHARES REPORTS NET INCOME OF $6.2 MILLION
FOR THE SECOND QUARTER OF 2006
Sacramento, California – August 1, 2006 - Placer Sierra Bancshares (NASDAQ: PLSB), a $2.7 billion asset commercial banking company serving the Northern, Central and Southern California markets, today announced financial results for the quarter ended June 30, 2006.
Net income for the quarter ended June 30, 2006 was $6.2 million, compared with net income of $6.1 million for the same period of the prior year. The Company recorded earnings of $0.36 per diluted share in the second quarter of 2006, compared with $0.40 per diluted share in the second quarter of 2005. The decline in diluted earnings per share from the prior year is attributable to the increase in the level of average weighted shares outstanding following the issuance of shares for the acquisition of Southwest Community Bancorp (Southwest) as of the close of business on June 9, 2006. Net income for the second quarter of 2006 includes losses totaling $622,000 ($360,000 net of taxes), or $0.02 per diluted share, including a $500,000 loss related to the bankruptcy of a vendor of Bank of Orange County (BOC) prior to the acquisition of BOC by the Company and a $122,000 loss related to the settlement of a lawsuit filed against the Company.
Commenting on the second quarter, Ron Bachli, Chairman and Chief Executive Officer of Placer Sierra Bancshares, said, “The integration of Southwest Community Bancorp has gone smoothly, and we are benefiting from the addition of its low-cost deposit base. These acquired deposits are helping to offset continued pressure on our net interest margin, as competition and pricing for deposits has increased faster than expected. During the second quarter, we also continued to experience solid loan production, including an increase in fees for CRE loans referred to third parties compared to the first quarter, as well as tight expense control despite continued investment in our business development functions.”
INCOME STATEMENT
NET INTEREST INCOME
Net interest income for the second quarter of 2006 was $23.3 million, compared to $20.5 million for the same period of 2005. The year-over-year increase in net interest income reflects the growth in average interest earning asset balances of 12.1% for the second quarter of 2006 compared to the second quarter of 2005, and an increase in the Company’s net interest margin.
NET INTEREST MARGIN
Net interest margin for the second quarter of 2006 was 5.25%, an increase of six basis points as compared to 5.19% during the second quarter of 2005, and an increase of 14 basis points compared to 5.11% during the first quarter of 2006. The increase in net interest margin from the first quarter of 2006 is primarily attributable to the addition of
Southwest’s low-cost deposit base during the second quarter, partially offset by increased funding costs throughout the remainder of the Bank’s operations.
During the second quarter of 2006, the yield on average earning assets increased to 6.99% from 6.78% for the first quarter of 2006. The yield on average loans and leases held for investment, net of deferred fees and costs, increased to 7.41% for the second quarter of 2006 from 7.22% for the first quarter of 2006. The increase in the yield on earning assets and average loans principally reflects the impact on loans tied to indexes associated with the prime rate as the rising interest rate environment continues.
The cost of deposits increased four basis points to 1.48% in the second quarter of 2006 from 1.44% for the first quarter of 2006. The cost of deposits increased principally due to increased rates paid on interest bearing core deposits in order to attract funding to support loan growth. The overall cost of interest bearing liabilities increased to 2.49% for the second quarter of 2006 compared to 2.34% for the first quarter of 2006. These increases are primarily due to both the repricing of the Company’s borrowings in a higher interest rate environment and the increase in the cost of deposits.
NON-INTEREST INCOME
Total non-interest income for the second quarter of 2006 was $4.6 million, compared with $4.1 million for the second quarter of 2005 and $3.7 million for the first quarter of 2006. The growth in non-interest income over the second quarter of 2005 and the first quarter of 2006 was primarily attributable to a $405,000 gain on the sale of loans in the second quarter of 2006. No loans were sold in 2005 or the first quarter of 2006. The increase in non-interest income over the first quarter of 2006 is also due to a $187,000, or 10.2%, increase in service charges and fees on deposit accounts, a $192,000, or 26.2%, increase in referral and other loan-related fees, and a $121,000, or 61.7%, increase in revenues from sales of non-deposit investment products.
NON-INTEREST EXPENSE
Total non-interest expense for the second quarter of 2006 was $17.7 million, compared with $14.5 million for the second quarter of 2005 and $15.4 million for the first quarter of 2006. The year-over-year and quarter-over-quarter increases reflect an accrual for the estimated loss of $500,000 relating to a bankrupt vendor and a $122,000 settlement of a lawsuit filed against the Company, as discussed above. In addition, salaries and benefits costs increased principally due to the acquisition of Southwest and reflects the growing complexity of our company. Salaries and benefits expense in 2006 also includes the impact of expensing stock options and restricted stock grants made during 2006. There were no such expenses included in 2005.
EFFICIENCY RATIO
The Company’s efficiency ratio for the second quarter of 2006 was 63.54%, compared to 59.05% in the second quarter of 2005 and 62.99% for the first quarter of 2006. The increase in the efficiency ratio in the second quarter of 2006 compared to the first quarter of 2006 is primarily due to losses of $622,000 relating to the vendor bankruptcy and lawsuit settlement discussed above. Excluding stock option and restricted stock compensation expense, the Company’s operating efficiency ratio for the second and first quarters of 2006 was 62.39% and 62.28%, respectively.
BALANCE SHEET
ASSETS
As of June 30, 2006, total assets were $2.696 billion, compared to $1.922 billion at March 31, 2006. The increase in assets reflects the acquisition of Southwest Community Bancorp.
LOANS
Total loans and leases held for investment, net of deferred fees and costs, were $1.785 billion at June 30, 2006, compared with $1.416 billion at March 31, 2006. Excluding the $334.9 million in loans associated with the acquisition of Southwest Community Bancorp, the annualized organic loan growth rate was 9.5% during the second quarter of 2006. The majority of the organic growth occurred in the residential real estate portfolio.
DEPOSITS
Total deposits were $2.207 billion at June 30, 2006, compared with $1.627 billion at March 31, 2006. Excluding the $562.4 million in deposits associated with the acquisition of Southwest Community Bancorp, the annualized organic deposit growth rate was 4.4% during the second quarter of 2006.
SHAREHOLDERS’ EQUITY
Total shareholders’ equity was $391.4 million at June 30, 2006, compared with $213.0 million at March 31, 2006. The increase in shareholders’ equity is primarily due to the issuance of common stock to the Southwest shareholders and the fair value of warrants assumed in connection with the acquisition of Southwest.
CREDIT QUALITY
The Company’s overall credit quality remained strong during the second quarter. While non-performing loans to total loans and leases held for investment increased to 0.17% at June 30, 2006 from 0.09% at March 31, 2006, the ratio remained well within the Company’s targeted level of risk. As such, management determined that no provision for loan and lease losses was required during the second quarter.
Net charge-offs were $11,000 in the second quarter of 2006, representing an annualized rate of 0.00% of average loans and leases held for investment, compared with net charge-offs of $149,000, or an annualized 0.04% of average loans and leases held for investment for the first quarter of 2006.
The allowance for loan and lease losses totaled $21.5 million at June 30, 2006 and represented 1.21% of loans and leases held for investment, net of deferred fees and costs, and 702.41% of non-performing loans and leases as of that date. The allowance for loan and lease losses totaled $16.6 million at March 31, 2006 and represented 1.17% of loans and leases held for investment net of deferred fees and costs, and 1,294.14% of non-performing loans and leases as of that date. The increase in the allowance at June 30, 2006 as compared to March 31, 2006 primarily relates to the inclusion of $5.0 million in allowances relating to loans acquired from Southwest.
SOUTHWEST COMMUNITY BANCORP ACQUISITION
As of the close of business on June 9, 2006, the Company completed the previously announced acquisition of Southwest Community Bancorp and its subsidiary Southwest Community Bank, a community bank with nine branches located in Southern California. With the completion of this acquisition, Southwest Community Bank merged into Placer Sierra Bank, a wholly owned subsidiary of Placer Sierra Bancshares. The assets acquired, including goodwill, totaled $756.5 million. Southwest Community Bancorp shareholders received 7,228,910 shares of Placer Sierra Bancshares common stock valued at $172.4 million on June 9, 2006. Placer Sierra Bancshares assumed all outstanding warrants which were convertible into a total of 153,346 shares of common stock as of June 9, 2006 valued at $2.8 million on the date of acquisition.
STOCK-BASED COMPENSATION
On January 1, 2006, the Company began expensing stock options in accordance with Statement of Financial Accounting Standards No. 123 (revised 2004),Share-Based Payment. Prior to January 1, 2006, no stock-based compensation expense was recognized for stock options issued. As a result of this accounting change, the Company is utilizing other stock-based compensation arrangements, such as restricted stock, in addition to stock options as part of the overall compensation strategy for executive management and directors.
The Company believes that the presentation of its operating earnings excluding the effects of stock-based compensation on 2006 earnings is important to gaining an understanding of the financial performance of its core banking operations. Accordingly, the following table shows operating earnings, exclusive of the impact of stock-based compensation, which is a non-GAAP basis presentation of the Company’s key performance indicators for the three and six months ended June 30, 2006 and 2005 (dollars in thousands, except per share data):
For the Three Months Ended | For the Six Months Ended June 30, | |||||||||||||||||||
June 30, | March 31, 2006 | |||||||||||||||||||
2006 | 2005 | 2006 | 2005 | |||||||||||||||||
Net income | $ | 6,151 | $ | 6,101 | $ | 5,527 | $ | 11,678 | $ | 11,271 | ||||||||||
Restricted stock compensation expense, net of tax | 83 | — | 20 | 103 | — | |||||||||||||||
Stock option compensation expense, net of tax | 103 | — | 81 | 184 | — | |||||||||||||||
Operating earnings | $ | 6,337 | $ | 6,101 | $ | 5,628 | $ | 11,965 | $ | 11,271 | ||||||||||
Profitability Measures: | ||||||||||||||||||||
GAAP earnings per share - basic | $ | 0.37 | $ | 0.41 | $ | 0.37 | $ | 0.73 | $ | 0.76 | ||||||||||
GAAP earnings per share - diluted | $ | 0.36 | $ | 0.40 | $ | 0.36 | $ | 0.72 | $ | 0.74 | ||||||||||
GAAP return on average assets | 1.19 | % | 1.33 | % | 1.18 | % | 1.18 | % | 1.24 | % | ||||||||||
GAAP return on average shareholders’ equity | 9.65 | % | 12.53 | % | 10.61 | % | 10.05 | % | 11.74 | % | ||||||||||
GAAP efficiency ratio | 63.54 | % | 59.05 | % | 62.99 | % | 63.28 | % | 61.42 | % | ||||||||||
Operating earnings per share - basic | $ | 0.38 | $ | 0.41 | $ | 0.37 | $ | 0.75 | $ | 0.76 | ||||||||||
Operating earnings per share - diluted | $ | 0.37 | $ | 0.40 | $ | 0.37 | $ | 0.74 | $ | 0.74 | ||||||||||
Operating return on average assets | 1.22 | % | 1.33 | % | 1.20 | % | 1.21 | % | 1.24 | % | ||||||||||
Operating return on average shareholders’ equity | 9.94 | % | 12.53 | % | 10.80 | % | 10.30 | % | 11.74 | % | ||||||||||
Operating efficiency ratio | 62.39 | % | 59.05 | % | 62.28 | % | 62.33 | % | 61.42 | % |
REGULATORY CAPITAL
Placer Sierra Bancshares’ regulatory capital ratios at June 30, 2006 are as follows:
Leverage Ratio | |||
Placer Sierra Bancshares | 12.2 | % | |
Minimum regulatory requirement | 4.0 | % | |
Tier 1 Risk-Based Capital Ratio | |||
Placer Sierra Bancshares | 11.5 | % | |
Minimum regulatory requirement | 4.0 | % | |
Total Risk-Based Capital Ratio | |||
Placer Sierra Bancshares | 12.6 | % | |
Minimum regulatory requirement | 8.0 | % |
OUTLOOK
The Company now anticipates full year 2006 fully-diluted earnings per share to range from $1.49 to $1.51.
Commenting on the outlook for Placer Sierra Bancshares, Mr. Bachli said, “Increasing funding costs will continue to present challenges for earnings growth throughout the remainder of 2006. However, we believe we will see higher quarterly earnings over the second half of the year, as our net interest income increases from the growth in our loan portfolio and our referral fees on CRE loans continue to improve. With the expansion of our business development force and healthy economic conditions in our markets, we are confident in our ability to continue attracting quality
assets to the Company. As our core deposit gathering initiatives gain traction in future quarters, we expect to deliver higher earnings growth for our shareholders.”
ABOUT PLACER SIERRA BANCSHARES
Placer Sierra Bancshares is a Northern California-based bank holding company for Placer Sierra Bank with 49 branches operating throughout California. The bank has 31 branches in Northern California extending from the Greater Sacramento area to the San Joaquin Valley. The bank also has 18 branches in the Southern California counties of Orange, Los Angeles, San Diego, Riverside and San Bernardino.
Placer Sierra Bank and its divisions, Sacramento Commercial Bank, Bank of Orange County, Bank of Lodi and Southwest Community Bank offer customers the resources of a large financial institution and the resourcefulness and superior customer service of a community bank.
Placer Sierra Bank offers a broad array of deposit products and services for both commercial and retail customers. These products include electronic banking, cash management services, electronic bill payment and investment services with an emphasis on relationship banking. Placer Sierra Bank also provides competitive loan products such as commercial loans and lines of credit, commercial real estate loans, Small Business Administration loans, residential mortgage loans, home equity lines of credit and construction loans. For more information, please visitwww.placersierrabank.com.
Placer Sierra Bancshares is publicly traded on NASDAQ under the stock symbol PLSB. For more information about Placer Sierra Bancshares, please visitwww.placersierrabancshares.com.
FORWARD-LOOKING STATEMENTS
This press release contains 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 that involve inherent risks and uncertainties. All statements other than statements of historical fact are forward looking statements. The Company cautions readers that a number of important factors could cause actual results to differ materially from those in such forward-looking statements. Risks and uncertainties include, but are not limited to: the possibility that personnel changes will not proceed as planned; growth may be inhibited if the Company cannot attract deposits, including low-cost deposits; revenues are lower than expected or expenses are higher than expected; competitive pressure among depository institutions increases significantly; the cost of additional capital is more than expected; changes in the interest rate environment reduces interest margins; general economic conditions, either nationally or in the market areas in which the Company does business, are less favorable than expected; changes that may occur in the securities markets; the Company may suffer an interruption of services from third-party service providers that could adversely affect the Company’s business; the Company may not be able to maintain an effective system of internal and disclosure controls; estimated cost savings from the merger with Southwest Community Bancorp (Southwest) cannot be fully realized within the expected time frame; revenues following the merger are lower than expected; potential or actual litigation occurs; costs or difficulties related to the integration of the businesses of the Company and Southwest are more than expected; or legislation or changes in regulatory requirements adversely affect the businesses in which the Company would be engaged. Additional factors that could cause the Company’s financial results to differ materially from those described in the forward looking statements can be found in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2005 (under the heading “Risk Factors”), Quarterly Reports on Form 10-Q and Current Reports on Form 8-K as filed with the SEC. The Company undertakes no obligation, and specifically disclaims any obligation, to revise or publicly release any revision or update to these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made. If any of these uncertainties materializes or any of these assumptions proves incorrect, the Company’s results could differ materially from the Company’s expectations as set forth in these statements.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
($ in thousands, except per share data)
June 30, 2006 | March 31, 2006 | December 31, 2005 | ||||||||||
Assets: | ||||||||||||
Cash and due from banks | $ | 227,828 | $ | 61,227 | $ | 55,768 | ||||||
Federal funds sold | 80,917 | 18,296 | 1,500 | |||||||||
Cash and cash equivalents | 308,745 | 79,523 | 57,268 | |||||||||
Interest bearing deposits with other banks | 100 | — | — | |||||||||
Investment securities available-for-sale, at fair value | 250,960 | 226,213 | 228,379 | |||||||||
Federal Reserve Bank and Federal Home Loan Bank stock | 16,540 | 14,476 | 14,385 | |||||||||
Loans and leases held for investment, net of allowance for loan and lease losses of $21,529 at June 30, 2006, $16,565 at March 31, 2006 and $16,714 at December 31, 2005 | 1,763,172 | 1,399,628 | 1,358,772 | |||||||||
Premises and equipment, net | 25,955 | 24,609 | 25,288 | |||||||||
Cash surrender value of life insurance | 54,639 | 44,736 | 44,330 | |||||||||
Goodwill | 216,465 | 103,260 | 103,260 | |||||||||
Other intangible assets, net | 23,821 | 11,119 | 11,589 | |||||||||
Other assets | 35,573 | 18,402 | 17,191 | |||||||||
Total assets | $ | 2,695,970 | $ | 1,921,966 | $ | 1,860,462 | ||||||
Liabilities and shareholders’ equity: | ||||||||||||
Liabilities: | ||||||||||||
Non-interest bearing deposits | $ | 964,358 | $ | 494,879 | $ | 502,387 | ||||||
Interest bearing deposits | 1,242,747 | 1,131,915 | 1,070,495 | |||||||||
Deposits | 2,207,105 | 1,626,794 | 1,572,882 | |||||||||
Short-term borrowings | 12,291 | 15,168 | 11,369 | |||||||||
Accrued interest payable and other liabilities | 21,562 | 13,432 | 13,319 | |||||||||
Junior subordinated deferrable interest debentures | 63,603 | 53,611 | 53,611 | |||||||||
Total liabilities | 2,304,561 | 1,709,005 | 1,651,181 | |||||||||
Shareholders’ equity: | ||||||||||||
Preferred stock | — | — | — | |||||||||
Common stock | 336,976 | 160,921 | 160,596 | |||||||||
Retained earnings | 59,010 | 54,670 | 50,948 | |||||||||
Accumulated other comprehensive loss, net of taxes | (4,577 | ) | (2,630 | ) | (2,263 | ) | ||||||
Total shareholders’ equity | 391,409 | 212,961 | 209,281 | |||||||||
Total liabilities and shareholders’ equity | $ | 2,695,970 | $ | 1,921,966 | $ | 1,860,462 | ||||||
Shares outstanding | 22,359,832 | 15,081,654 | 15,042,981 | |||||||||
Book value per share | $ | 17.51 | $ | 14.12 | $ | 13.91 |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
($ in thousands, except per share data)
Three Months Ended | Six Months Ended June 30, | ||||||||||||||||
June 30, | March 31, 2006 | ||||||||||||||||
2006 | 2005 | 2006 | 2005 | ||||||||||||||
Interest income: | |||||||||||||||||
Interest and fees on loans and leases held for investment | $ | 27,909 | $ | 21,718 | $ | 24,622 | $ | 52,531 | $ | 42,484 | |||||||
Interest on interest bearing deposits with other banks | — | 1 | — | — | 2 | ||||||||||||
Interest and dividends on investment securities: | |||||||||||||||||
Taxable | 2,570 | 2,580 | 2,527 | 5,097 | 4,953 | ||||||||||||
Tax-exempt | 240 | 187 | 183 | 423 | 350 | ||||||||||||
Interest on federal funds sold | 255 | 228 | 301 | 556 | 354 | ||||||||||||
Total interest income | 30,974 | 24,714 | 27,633 | 58,607 | 48,143 | ||||||||||||
Interest expense: | |||||||||||||||||
Interest on deposits | 6,324 | 3,346 | 5,662 | 11,986 | 6,097 | ||||||||||||
Interest on short-term borrowings | 294 | 25 | 102 | 396 | 59 | ||||||||||||
Interest on junior subordinated deferrable interest debentures | 1,096 | 836 | 1,036 | 2,132 | 1,596 | ||||||||||||
Total interest expense | 7,714 | 4,207 | 6,800 | 14,514 | 7,752 | ||||||||||||
Net interest income | 23,260 | 20,507 | 20,833 | 44,093 | 40,391 | ||||||||||||
Provision for the allowance for loan and lease losses | — | — | — | — | — | ||||||||||||
Net interest income after provision for the allowance for loan and lease losses | 23,260 | 20,507 | 20,833 | 44,093 | 40,391 | ||||||||||||
Non-interest income: | |||||||||||||||||
Service charges and fees on deposit accounts | 2,017 | 2,006 | 1,830 | 3,847 | 3,731 | ||||||||||||
Referral and other loan-related fees | 924 | 1,018 | 732 | 1,656 | 1,536 | ||||||||||||
Increase in cash surrender value of life insurance | 425 | 430 | 406 | 831 | 844 | ||||||||||||
Gain on sale of loans, net | 405 | — | — | 405 | — | ||||||||||||
Debit card and merchant discount fees | 349 | 306 | 300 | 649 | �� | 589 | |||||||||||
Revenues from sales of non-deposit investment products | 317 | 175 | 196 | 513 | 366 | ||||||||||||
Loan servicing income | 39 | 105 | 100 | 139 | 238 | ||||||||||||
Loss on sale of investment securities available-for-sale, net | — | (55 | ) | — | — | (55 | ) | ||||||||||
Other | 139 | 119 | 126 | 265 | 318 | ||||||||||||
Total non-interest income | 4,615 | 4,104 | 3,690 | 8,305 | 7,567 | ||||||||||||
Non-interest expense: | |||||||||||||||||
Salaries and employee benefits | 9,290 | 7,400 | 8,301 | 17,591 | 14,998 | ||||||||||||
Occupancy and equipment | 2,279 | 1,941 | 2,063 | 4,342 | 3,991 | ||||||||||||
Other | 6,142 | 5,193 | 5,082 | 11,224 | 10,469 | ||||||||||||
Total non-interest expense | 17,711 | 14,534 | 15,446 | 33,157 | 29,458 | ||||||||||||
Income before income taxes | 10,164 | 10,077 | 9,077 | 19,241 | 18,500 | ||||||||||||
Provision for income taxes | 4,013 | 3,976 | 3,550 | 7,563 | 7,229 | ||||||||||||
Net income | $ | 6,151 | $ | 6,101 | $ | 5,527 | $ | 11,678 | $ | 11,271 | |||||||
Earnings per share: | |||||||||||||||||
Basic | $ | 0.37 | $ | 0.41 | $ | 0.37 | $ | 0.73 | $ | 0.76 | |||||||
Diluted | $ | 0.36 | $ | 0.40 | $ | 0.36 | $ | 0.72 | $ | 0.74 | |||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 16,745,134 | 14,914,983 | 15,047,255 | 15,900,885 | 14,901,931 | ||||||||||||
Diluted | 17,012,998 | 15,209,930 | 15,292,683 | 16,170,269 | 15,206,857 | ||||||||||||
Cash dividends declared per share | $ | 0.12 | $ | 0.12 | $ | 0.12 | $ | 0.24 | $ | 0.24 | |||||||
UNAUDITED CONDENSED CONSOLIDATED AVERAGE BALANCE SHEETS
($ in thousands)
Three Months Ended | Six Months Ended June 30, | |||||||||||||||||||
June 30, | March 31, 2006 | |||||||||||||||||||
2006 | 2005 | 2006 | 2005 | |||||||||||||||||
Average assets: | ||||||||||||||||||||
Loans and leases, held for investment | $ | 1,510,246 | $ | 1,301,172 | $ | 1,383,375 | $ | 1,447,161 | $ | 1,295,031 | ||||||||||
Investment securities available- for-sale | 231,749 | 237,292 | 226,648 | 229,215 | 232,994 | |||||||||||||||
Federal funds sold | 21,004 | 33,490 | 27,414 | 24,191 | 26,715 | |||||||||||||||
Interest bearing deposits with other banks | 36 | 126 | — | 18 | 126 | |||||||||||||||
Other earning assets | 15,127 | 13,449 | 14,400 | 14,765 | 11,948 | |||||||||||||||
Average earning assets | 1,778,162 | 1,585,529 | 1,651,837 | 1,715,350 | 1,566,814 | |||||||||||||||
Other assets | 299,923 | 255,190 | 244,703 | 272,464 | 259,227 | |||||||||||||||
Average total assets | $ | 2,078,085 | $ | 1,840,719 | $ | 1,896,540 | $ | 1,987,814 | $ | 1,826,041 | ||||||||||
Average liabilities and shareholders’ equity: | ||||||||||||||||||||
Average liabilities: | ||||||||||||||||||||
Non-interest bearing deposits | $ | 563,338 | $ | 494,825 | $ | 490,687 | $ | 527,212 | $ | 490,136 | ||||||||||
Interest bearing deposits | 1,152,112 | 1,065,793 | 1,103,260 | 1,127,822 | 1,052,989 | |||||||||||||||
Average deposits | 1,715,450 | 1,560,618 | 1,593,947 | 1,655,034 | 1,543,125 | |||||||||||||||
Other interest bearing liabilities | 89,768 | 66,859 | 74,622 | 82,237 | 68,073 | |||||||||||||||
Other liabilities | 17,272 | 17,939 | 16,710 | 16,180 | 21,262 | |||||||||||||||
Average liabilities | 1,822,490 | 1,645,416 | 1,685,279 | 1,753,451 | 1,632,460 | |||||||||||||||
Average shareholders’ equity | 255,595 | 195,303 | 211,261 | 234,363 | 193,581 | |||||||||||||||
Average liabilities and shareholders’ equity | $ | 2,078,085 | $ | 1,840,719 | $ | 1,896,540 | $ | 1,987,814 | $ | 1,826,041 | ||||||||||
YIELD ANALYSIS: | ||||||||||||||||||||
Average loans and leases held for investment | $ | 1,510,246 | $ | 1,301,172 | $ | 1,383,375 | $ | 1,447,161 | $ | 1,295,031 | ||||||||||
Yield | 7.41 | % | 6.69 | % | 7.22 | % | 7.32 | % | 6.62 | % | ||||||||||
Average earnings assets | $ | 1,778,162 | $ | 1,585,529 | $ | 1,651,837 | $ | 1,715,350 | $ | 1,566,814 | ||||||||||
Yield | 6.99 | % | 6.25 | % | 6.78 | % | 6.89 | % | 6.20 | % | ||||||||||
Average interest bearing deposits | $ | 1,152,112 | $ | 1,065,793 | $ | 1,103,260 | $ | 1,127,822 | $ | 1,052,989 | ||||||||||
Cost | 2.20 | % | 1.26 | % | 2.08 | % | 2.14 | % | 1.17 | % | ||||||||||
Average deposits | $ | 1,715,450 | $ | 1,560,618 | $ | 1,593,947 | $ | 1,655,034 | $ | 1,543,125 | ||||||||||
Cost | 1.48 | % | 0.86 | % | 1.44 | % | 1.46 | % | 0.80 | % | ||||||||||
Average interest bearing liabilities | $ | 1,241,880 | $ | 1,132,652 | $ | 1,177,882 | $ | 1,210,059 | $ | 1,121,062 | ||||||||||
Cost | 2.49 | % | 1.49 | % | 2.34 | % | 2.42 | % | 1.39 | % | ||||||||||
Interest spread | 4.50 | % | 4.76 | % | 4.44 | % | 4.47 | % | 4.81 | % | ||||||||||
Net interest margin | 5.25 | % | 5.19 | % | 5.11 | % | 5.18 | % | 5.20 | % |
CREDIT QUALITY MEASURES
At or for the Six Months Ended 6/30/06 | At or for the Three Months Ended 3/31/06 | At or for the Twelve Months Ended 12/31/05 | At or for the Nine Months Ended 9/30/05 | At or for the Six Months Ended 6/30/05 | |||||||||||
Non-performing loans and leases to total | 0.17 | % | 0.09 | % | 0.22 | % | 0.13 | % | 0.24 | % | |||||
Non-performing assets to total assets | 0.11 | % | 0.07 | % | 0.16 | % | 0.09 | % | 0.17 | % | |||||
Allowance for loan and lease losses to total | 1.21 | % | 1.17 | % | 1.22 | % | 1.20 | % | 1.24 | % | |||||
Allowance for loan and lease losses to | 702.41 | % | 1294.14 | % | 545.67 | % | 948.36 | % | 527.20 | % | |||||
Allowance for loan and lease losses to | 702.41 | % | 1294.14 | % | 545.67 | % | 948.36 | % | 527.20 | % | |||||
Net charge-offs (recoveries) to average | 0.02 | % | 0.04 | % | (0.04 | )% | 0.00 | % | (0.04 | )% |
LOANS
($ in thousands)
Balance at 06/30/06 | Balance at 03/31/06 | Balance at 12/31/05 | Balance at 09/30/05 | Balance at 06/30/05 | ||||||||||||||||
Loans and leases held for investment: | ||||||||||||||||||||
Real estate - mortgage | $ | 1,260,853 | $ | 1,029,246 | $ | 990,362 | $ | 966,523 | $ | 949,131 | ||||||||||
Real estate - construction | 327,757 | 211,605 | 207,078 | 197,975 | 183,886 | |||||||||||||||
Commercial | 169,676 | 149,104 | 147,830 | 153,172 | 155,938 | |||||||||||||||
Agricultural | 4,940 | 3,645 | 5,779 | 8,363 | 7,652 | |||||||||||||||
Consumer | 13,370 | 12,181 | 11,703 | 10,910 | 10,950 | |||||||||||||||
Leases receivable and other | 11,288 | 12,755 | 15,431 | 17,475 | 20,477 | |||||||||||||||
Total gross loans and leases held for investment | 1,787,884 | 1,418,536 | 1,378,183 | 1,354,418 | 1,328,034 | |||||||||||||||
Less: Allowance for loan and lease losses | (21,529 | ) | (16,565 | ) | (16,714 | ) | (16,236 | ) | (16,475 | ) | ||||||||||
Deferred loan and lease fees, net | (3,183 | ) | (2,343 | ) | (2,697 | ) | (2,567 | ) | (2,172 | ) | ||||||||||
Total net loans and leases held for investment | $ | 1,763,172 | $ | 1,399,628 | $ | 1,358,772 | $ | 1,335,615 | $ | 1,309,387 | ||||||||||
Total loans and leases held for investment, net of deferred fees and costs | $ | 1,784,701 | $ | 1,416,193 | $ | 1,375,486 | $ | 1,351,851 | $ | 1,325,862 | ||||||||||
Percent of gross loans and leases held for investment: | ||||||||||||||||||||
Real estate - mortgage | 70.5 | % | 72.5 | % | 71.9 | % | 71.4 | % | 71.5 | % | ||||||||||
Real estate - construction | 18.3 | % | 14.9 | % | 15.0 | % | 14.6 | % | 13.9 | % | ||||||||||
Commercial | 9.5 | % | 10.5 | % | 10.7 | % | 11.3 | % | 11.7 | % | ||||||||||
Agricultural | 0.3 | % | 0.3 | % | 0.4 | % | 0.6 | % | 0.6 | % | ||||||||||
Consumer | 0.8 | % | 0.9 | % | 0.8 | % | 0.8 | % | 0.8 | % | ||||||||||
Leases receivable and other | 0.6 | % | 0.9 | % | 1.2 | % | 1.3 | % | 1.5 | % | ||||||||||
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||
DEPOSITS
($ in thousands)
Balance at 06/30/06 | Balance at 03/31/06 | Balance at 12/31/05 | Balance at 09/30/05 | Balance at 06/30/05 | ||||||||||||||||
Non-interest bearing deposits | $ | 964,358 | $ | 494,879 | $ | 502,387 | $ | 496,787 | $ | 501,492 | ||||||||||
Interest bearing deposits: | ||||||||||||||||||||
Interest bearing demand | 228,723 | 224,537 | 223,932 | 248,013 | 248,653 | |||||||||||||||
Money market | 418,329 | 355,474 | 289,497 | 292,154 | 285,149 | |||||||||||||||
Savings | 150,514 | 151,809 | 164,123 | 173,138 | 181,797 | |||||||||||||||
Time, under $100,000 | 204,973 | 209,235 | 211,029 | 197,177 | 196,076 | |||||||||||||||
Time, $100,000 or more | 240,208 | 190,860 | 181,914 | 168,478 | 170,012 | |||||||||||||||
Total interest bearing deposits | 1,242,747 | 1,131,915 | 1,070,495 | 1,078,960 | 1,081,687 | |||||||||||||||
Total deposits | $ | 2,207,105 | $ | 1,626,794 | $ | 1,572,882 | $ | 1,575,747 | $ | 1,583,179 | ||||||||||
Percent of total deposits: | ||||||||||||||||||||
Non-interest bearing deposits | 43.7 | % | 30.4 | % | 31.9 | % | 31.5 | % | 31.7 | % | ||||||||||
Interest bearing deposits: | ||||||||||||||||||||
Interest bearing demand | 10.3 | % | 13.8 | % | 14.2 | % | 15.7 | % | 15.7 | % | ||||||||||
Money market | 19.0 | % | 21.9 | % | 18.5 | % | 18.6 | % | 18.0 | % | ||||||||||
Savings | 6.8 | % | 9.3 | % | 10.4 | % | 11.0 | % | 11.5 | % | ||||||||||
Time, under $100,000 | 9.3 | % | 12.9 | % | 13.4 | % | 12.5 | % | 12.4 | % | ||||||||||
Time, $100,000 or more | 10.9 | % | 11.7 | % | 11.6 | % | 10.7 | % | 10.7 | % | ||||||||||
Total interest bearing deposits | 56.3 | % | 69.6 | % | 68.1 | % | 68.5 | % | 68.3 | % | ||||||||||
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||