Exhibit 99.1
| | |
| | | | |
Contact: | | Daniel M. Quinn | | Paul W. Taylor |
| | President & Chief Executive Officer | | E.V.P. & Chief Financial Officer |
| | 1331 Seventeenth Street, Suite 300 | | 1331 Seventeenth Street, Suite 300 |
| | Denver, CO 80202 | | Denver, CO 80202 |
| | 303/313-6736 | | 303/293-5563 |
FOR IMMEDIATE RELEASE:
Centennial Bank Holdings, Inc. Announces First Quarter 2008 Earnings
Denver, Colorado (April 18, 2008) – Centennial Bank Holdings (Nasdaq: CBHI) today reported first quarter 2008 net income of $3.2 million, or 6 cents per basic and diluted share, compared to first quarter 2007 net income of $5.4 million, or 10 cents per basic and diluted share. Excluding after-tax intangible asset amortization of $1.2 million, first quarter 2008 cash net income was $4.4 million, or 9 cents per basic and diluted share, compared to first quarter 2007 cash net income of $6.8 million, or 12 cents per basic and diluted share. First quarter 2008 net income is down compared to the first quarter 2007 net income primarily due to a decrease in net interest income as a result of lower rates and volumes. This decrease was partially offset by lower noninterest expense and tax expense.
Dan Quinn, Centennial Bank Holdings President and CEO, stated, “While the operating environment for banks remains challenging, we are pleased with the progress of our strategic repositioning. Our decision in 2006 to significantly reduce our exposure to residential real estate development coupled with our continued aggressive credit management have served us well. Total nonperforming assets are down 32% as compared to March 31, 2007, and are relatively flat with the prior quarter. Net chargeoffs for the quarter were $538,000, the lowest level since the first quarter of 2006. Going forward, we will continue to execute on our strategy while looking to capitalize on opportunities that may present themselves.”
Key Financial Measures
| | Quarter Ended | |
| | March 31,
2008 | | December 31,
2007 | | March 31,
2007 | |
Earnings (loss) per share-basic & diluted | | $ | 0.06 | | $ | (2.68 | ) | $ | 0.10 | |
Cash earnings per share-basic & diluted | | $ | 0.09 | | $ | 0.10 | | $ | 0.12 | |
Return on average assets | | 0.55 | % | (22.09 | )% | 0.82 | % |
Return on tangible average assets (cash) | | 0.85 | % | 0.98 | % | 1.22 | % |
Net Interest Margin | | 4.42 | % | 4.75 | % | 5.16 | % |
Net Interest Income and Margin
| | Quarter Ended | |
| | March 31,
2008 | | December 31,
2007 | | March 31,
2007 | |
| | (Dollars in thousands) | |
Net interest income | | $ | 21,650 | | $ | 24,184 | | $ | 26,843 | |
Interest rate spread | | 3.58 | % | 3.77 | % | 4.16 | % |
Net interest margin | | 4.42 | % | 4.75 | % | 5.16 | % |
Net interest margin, fully tax equivalent | | 4.53 | % | 4.88 | % | 5.55 | % |
| | | | | | | | | | |
First quarter 2008 net interest income of $21.7 million decreased by $2.5 million, or 10.5%, from the fourth quarter 2007 and $5.2 million, or 19.3%, from the first quarter 2007. The Company’s net interest margin of 4.42% for the first quarter 2008 reflected a decline of 33 basis points from the fourth quarter 2007 and a decline of 74 basis points from the first quarter 2007. These declines in net interest margin are mostly attributable to rate cuts by Federal Open Market Committee of the Federal Reserve Board during the first quarter of 2008.
Interest income decreased by $9.0 million, or 21.1%, from the first quarter 2007. This decrease consisted of a $6.0 million rate variance due to lower rates, primarily on loans, with the remainder of the decrease due to a decline in earnings assets. Approximately 69% of the Company’s outstanding loan balances are variable rate loans and are generally tied to indexes such as prime, LIBOR or federal funds. The prime rate has decreased by 300 basis points from March 2007 to March 2008. As a result of the decline in rates, the average yield on loans for the Company decreased by 138 basis points from 8.44% for the quarter ended March 31, 2007 to 7.06% for the same period in 2008. The $5.1 million decrease in interest income from the fourth quarter 2007 is also mostly attributable to rate decreases.
Interest expense decreased by $3.8 million, or 24.3%, from the first quarter 2007. The decrease in interest expense from the first quarter 2007 was primarily the result of a $2.2 million rate variance and a $1.6 million volume variance. The overall cost of funds declined by 74 basis points from the first quarter 2007 to the first quarter 2008. Average total interest bearing deposits declined by $170.7 million from the first quarter 2007 to the first quarter 2008, with $102.9 million of the decrease in balances attributable to time deposits. This decline in time deposits is mostly due to a strategic decision to continue to reduce the balances of non-core time-deposits to mitigate the impact of margin compression. The $2.6 million decrease in interest expense from the fourth quarter 2007 was caused primarily by lower interest-bearing deposits and liabilities. Additionally, there was a 55 basis point decline in the cost of funds from the fourth quarter 2007.
Noninterest Income
The following table presents noninterest income as of the dates indicated.
| | Quarter Ended | |
| | March 31,
2008 | | March 31,
2007 | |
| | (In thousands) | |
Noninterest income: | | | | | |
Customer service and other fees | | $ | 2,276 | | $ | 2,443 | |
Gain on sale of securities | | 138 | | — | |
Other | | 101 | | 124 | |
Total noninterest income | | $ | 2,515 | | $ | 2,567 | |
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Noninterest income for first quarter 2008 decreased by $0.1 million from the first quarter 2007, remaining relatively flat overall.
Noninterest Expense
The following table presents noninterest expense as of the dates indicated.
| | Quarter Ended | |
| | March 31,
2008 | | March 31,
2007 | |
| | (In thousands) | |
Noninterest expense: | | | | | |
Salaries and employee benefits | | $ | 9,720 | | $ | 10,974 | |
Occupancy expense | | 2,001 | | 2,121 | |
Furniture and equipment | | 1,314 | | 1,240 | |
Amortization of intangible assets | | 1,877 | | 2,195 | |
Other general and administrative | | 3,798 | | 4,152 | |
Total noninterest expense | | $ | 18,710 | | $ | 20,682 | |
Noninterest expense for the first quarter 2008 of $18.7 million decreased by $2.0 million, or 9.5%, from the first quarter 2007. First quarter 2008 salaries and employee benefits decreased by $1.3 million, or 11.4%, from the first quarter 2007. The first quarter 2008 decrease in salaries and employee benefits is mostly due to a 9.9% reduction in full-time equivalent employees, as well as a reduction in incentive expense. First quarter 2008 intangible amortization expense decreased by $0.3 million from the first quarter 2007 due to the use of accelerated amortization methods to amortize the core deposit intangible asset.
Other general and administrative expense decreased by $0.4 million, or 8.5%, in the first quarter 2008 as compared to the first quarter 2007. Overall professional fees decreased by $0.5 million and provision for unfunded commitments declined by $0.3 million in the first quarter 2008 as compared to the same period in 2007. These expense decreases were partially offset by a $0.5 million increase in expenses associated with other real estate, mostly attributable to a write-down of a single property.
Balance Sheet
| | March 31,
2008 | | December 31,
2007 | | %
Change | | March 31,
2007 | | %
Change | |
| | (Dollars in thousands, except per share amounts) | |
Total loans, net of unearned discount | | $ | 1,759,297 | | $ | 1,781,647 | | (1.3 | )% | $ | 1,886,613 | | (6.7 | )% |
Allowance for loan losses | | (26,048 | ) | (25,711 | ) | 1.3 | % | (27,492 | ) | (5.3 | )% |
Total assets | | 2,345,079 | | 2,371,664 | | (1.1 | )% | 2,693,384 | | (12.9 | )% |
Average assets, quarter-to-date | | 2,376,539 | | 2,482,352 | | (4.3 | )% | 2,687,549 | | (11.6 | )% |
Total deposits | | 1,710,082 | | 1,799,507 | | (5.0 | )% | 1,971,869 | | (13.3 | )% |
Book value per share | | $ | 7.99 | | $ | 7.96 | | 0.4 | % | $ | 10.46 | �� | (23.6 | )% |
Tangible book value per share | | $ | 2.65 | | $ | 2.57 | | 3.1 | % | $ | 2.68 | | (1.2 | )% |
At March 31, 2008, the Company had total assets of $2.3 billion, or $26.6 million less than total assets at December 31, 2007, and $348.3 million less than total assets at March 31, 2007. The $26.6 million decline in assets from December 31, 2007 is mostly due to $22.4 million decrease in loans, net of unearned discount. The $348.3 million decrease in assets from March 31, 2007, is partly due to a $150.6 million decrease in intangible assets due to a goodwill impairment charge recorded in the fourth quarter 2007 and the amortization of the core deposit intangible asset. The
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remainder of the decrease in assets from March 31, 2007, is due to a $127.3 million decline in loans, net of unearned discount. Approximately $48 million of this $127.3 million decline in loans from March 31, 2007 to March 31, 2008 is attributable to the sale of certain impaired and classified loans in October 2007. A significant portion of the remaining decrease in loans is due to the Company’s strategy of reducing its concentration of residential construction and land development loans. Total residential and commercial construction loans declined by $114.4 million from March 31, 2007.
The following table sets forth the amounts of our loans outstanding at the dates indicated:
| | March 31,
2008 | | December 31,
2007 | | March 31,
2007 | |
| | (In thousands) | |
Real Estate | | | | | | | |
Mortgage | | $ | 723,246 | | $ | 713,478 | | $ | 708,416 | |
Construction | | 238,926 | | 235,236 | | 353,323 | |
Equity lines of credit | | 47,659 | | 48,624 | | 54,904 | |
Commercial | | 657,423 | | 679,717 | | 651,796 | |
Agricultural | | 35,003 | | 39,506 | | 46,958 | |
Lease financing | | 472 | | 4,732 | | 6,503 | |
Installment loans to individuals | | 38,151 | | 40,835 | | 43,891 | |
Overdrafts | | 2,520 | | 1,329 | | 4,499 | |
SBA and other | | 19,213 | | 21,592 | | 20,211 | |
Total gross loans | | 1,762,613 | | 1,785,049 | | 1,890,501 | |
Unearned discount | | (3,316 | ) | (3,402 | ) | (3,888 | ) |
Loans, net of unearned discount | | $ | 1,759,297 | | $ | 1,781,647 | | $ | 1,886,613 | |
The following table sets forth the amounts of our deposits outstanding at the dates indicated:
| | March 31,
2008 | | December 31,
2007 | | March 31,
2007 | |
| | (In thousands) | |
Noninterest-bearing demand | | $ | 473,247 | | $ | 515,299 | | $ | 519,951 | |
Interest-bearing demand | | 156,416 | | 160,100 | | 165,555 | |
Money market | | 582,013 | | 572,056 | | 624,366 | |
Savings | | 71,617 | | 71,944 | | 81,689 | |
Time | | 426,789 | | 480,108 | | 580,308 | |
Total deposits | | $ | 1,710,082 | | $ | 1,799,507 | | $ | 1,971,869 | |
Total deposits at March 31, 2008, decreased by $89.4 million and $261.8 million from December 31, 2007 and March 31, 2007, respectively. Approximately $53.3 million, or 60% of this decline, from December 31, 2007, is from a decrease in time deposits due to a strategic decision to mitigate the impact of margin compression. Most of the remainder of the decline in deposits is attributable to noninterest-bearing demand deposits. The decline in deposits from March 31, 2007, is mostly due to a $153.5 million decrease in time deposits and a $42.4 million decrease in money market deposits. Non-interest bearing deposits comprise 27.7% of total deposits at March 31, 2008, as compared to 28.6% at December 31, 2007, and 26.4% at March 31, 2007.
Overall borrowings increased by $53.5 million, from December 31, 2007 to March 31, 2008.�� This increase is mostly attributable to a decision to further utilize FHLB term advances as an alternative funding source.
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Regulatory Capital Measures are Above the Well-Capitalized Minimums
The Company remains more than well-capitalized for regulatory capital purposes at March 31, 2008. In addition to exceeding the requirements to be a well capitalized institution, the regulatory capital ratios improved from the prior quarter as follows:
| | Ratio at
March 31,
2008 | | Ratio at
December 31,
2007 | | Minimum Capital
Requirement | | Minimum
Requirement for
“Well
Capitalized”
Institution | |
| | | | | | | | | |
Total Risk-Based Capital Ratio | | 11.2 | % | 10.9 | % | 8.00 | % | 10.00 | % |
Tier 1 Risk Based Capital Ratio | | 9.9 | % | 9.6 | % | 4.00 | % | 6.00 | % |
Leverage Ratio | | 9.2 | % | 8.6 | % | 4.00 | % | 5.00 | % |
Asset Quality
The following table presents selected asset quality data (excluding loans held for sale) as of the dates indicated:
| | March 31,
2008 | | December 31,
2007 | | September 30,
2007 | | June 30,
2007 | | March 31,
2007 | |
| | (Dollars in thousands) | |
Nonaccrual loans, not restructured | | $ | 20,798 | | $ | 19,309 | | $ | 16,831 | | $ | 35,515 | | $ | 31,940 | |
Accruing loans past due 90 days or more | | 1 | | 527 | | 9 | | 122 | | 323 | |
| | | | | | | | | | | |
Total nonperforming loans (NPLs) | | 20,799 | | 19,836 | | 16,840 | | 35,637 | | 32,263 | |
Other real estate owned | | 1,715 | | 3,517 | | 3,401 | | 1,385 | | 861 | |
| | | | | | | | | | | |
Total nonperforming assets (NPAs) | | $ | 22,514 | | $ | 23,353 | | $ | 20,241 | | $ | 37,022 | | $ | 33,124 | |
| | | | | | | | | | | |
Allowance for loan losses | | $ | 26,048 | | $ | 25,711 | | $ | 23,979 | | $ | 35,594 | | $ | 27,492 | |
| | | | | | | | | | | |
Selected ratios: | | | | | | | | | | | |
NPLs to loans, net of unearned discount | | 1.18 | % | 1.11 | % | 0.93 | % | 1.88 | % | 1.71 | % |
NPAs to total assets | | 0.96 | % | 0.98 | % | 0.77 | % | 1.40 | % | 1.23 | % |
Allowance for loan losses to NPAs | | 115.70 | % | 110.10 | % | 118.47 | % | 96.14 | % | 83.00 | % |
Allowance for loan losses to NPLs | | 125.24 | % | 129.62 | % | 142.39 | % | 99.88 | % | 85.21 | % |
Allowance for loan losses to loans, net of unearned discount | | 1.48 | % | 1.44 | % | 1.32 | % | 1.88 | % | 1.46 | % |
Nonperforming assets decreased by $0.8 million, or 3.6%, at March 31, 2008 as compared to December 31, 2007, and decreased by $10.6 million, or 32.0%, as compared to March 31, 2007. The decrease from March 2007 was mostly due to the sale of certain nonperforming and classified loans on October 31, 2007.
The Company took a first quarter 2008 provision for loan losses of $0.9 million, as compared to $3.0 million in the fourth quarter 2007 and $0.8 million in the first quarter 2007. Net charge-offs in the first quarter 2008 were $0.6 million in the first quarter 2008, as compared to $1.3 million in the fourth quarter 2007, and $1.3 million in the first quarter 2007.
The allowance for loan losses to total loans outstanding was 1.48% at March 31, 2008, as compared to 1.44% at December 31, 2007 and 1.46% at March 31, 2007.
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Stock Repurchase Programs
At March 31, 2008, the Company had 1,349,858 shares remaining under its previously existing stock repurchase programs. The remaining shares may be acquired from time to time either in the open market or in privately negotiated transactions in accordance with applicable regulations of the Securities and Exchange Commission. During the first quarter 2008, the Company did not repurchase any shares under its stock repurchase programs and only repurchased 9,087 shares related to the net settlement of vested, restricted stock awards at a cost of $0.1 million, or an average price of $5.63 per share. As of March 31, 2008, the Company had 52,662,997 shares outstanding, including 1,732,011 shares of unvested stock awards. In addition, the Company had 63,123 of shares to be issued at March 31, 2008 under its deferred compensation plan.
Non-GAAP Financial Measures
This press release includes non-GAAP financial measures related to the income statement, including cash net income, cash earnings per share and return on average tangible assets (cash), which exclude the after-tax impact of intangible asset amortization expense.
This press release also includes non-GAAP financial measures related to tangible assets, including return on average tangible assets (cash) and tangible book value. These items exclude the average and actual intangible assets, respectively.
The Company discloses these non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of the Company’s core financial performance. Management believes that these non-GAAP financial measures allow for additional transparency and are used by some investors, analysts and other users of the Company’s financial information as performance measures. These non-GAAP financial measures are presented for supplemental informational purposes only for understanding the Company’s operating results and should not be considered a substitute for financial information presented in accordance with GAAP. These non-GAAP financial measures presented by the Company may be different from non-GAAP financial measures used by other companies.
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The following non-GAAP schedule reconciles cash net income and return on tangible net assets (cash) to their respective GAAP measure as of the dates indicated:
| | Quarter Ended | |
| | March 31, 2008 | | March 31, 2007 | |
| | (In thousands, except share and per
share data) | |
Cash net income | | | | | |
GAAP net income | | $ | 3,245 | | $ | 5,409 | |
Add: Amortization of intangible assets | | 1,877 | | 2,195 | |
Less: Income tax effect | | (713 | ) | (834 | ) |
Cash net income | | $ | 4,409 | | $ | 6,770 | |
| | | | | |
Weighted average shares – diluted | | 51,049,525 | | 54,902,229 | |
| | | | | |
Earnings per share – diluted | | $ | 0.06 | | $ | 0.10 | |
Add: Amortization of intangible assets (after tax effect) | | 0.03 | | 0.02 | |
Cash earnings per share | | $ | 0.09 | | $ | 0.12 | |
| | | | | |
Return on tangible net assets (cash) | | | | | |
Cash net income | | $ | 4,409 | | $ | 6,770 | |
| | | | | |
Average total assets | | $ | 2,376,539 | | $ | 2,687,549 | |
Less average intangible assets | | (282,830 | ) | (433,573 | ) |
Average tangible assets | | $ | 2,093,709 | | $ | 2,253,976 | |
| | | | | |
Return on average assets - GAAP net income divided by total average assets | | 0.55 | % | 0.82 | % |
| | | | | |
Return on average tangible assets (cash) - cash net income divided by average tangible assets | | 0.85 | % | 1.22 | % |
The following non-GAAP schedule reconciles the book value per share to the tangible book value per share as of the dates indicated:
| | March 31,
2008 | | December 31,
2007 | | March 31,
2007 | |
| | (Dollars in thousands, except share and per share amounts) | |
Tangible Book Value per Share | | | | | | | |
Stockholders’ equity | | $ | 421,461 | | $ | 418,654 | | $ | 581,097 | |
Intangible assets | | (281,804 | ) | (283,681 | ) | (432,362 | ) |
Tangible equity | | $ | 139,657 | | $ | 134,973 | | $ | 148,735 | |
| | | | | | | |
Number of shares outstanding and to be issued | | 52,726,120 | | 52,616,991 | | 55,555,400 | |
Book value per share | | $ | 7.99 | | $ | 7.96 | | $ | 10.46 | |
Tangible book value per share | | $ | 2.65 | | $ | 2.57 | | $ | 2.68 | |
About Centennial Bank Holdings, Inc.
Centennial Bank Holdings, Inc. is a bank holding company that operates 36 branches in Colorado through a single bank, Guaranty Bank and Trust Company. The bank provides banking and other financial services including real estate, construction, commercial and industrial, energy, consumer and agricultural loans throughout its targeted Colorado markets to consumers and small to medium-sized businesses, including the owners and employees of those businesses. The bank also provides trust services, including personal trust administration, estate settlement, investment management accounts and self-directed IRAs. More information about Centennial Bank Holdings, Inc. can be found at www.cbhi.com.
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Forward-Looking Statements
Certain statements contained in this press release, including, without limitation, statements containing the words “believes”, “anticipates”, “intends”, “expects”, and words of similar import, constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions in those areas in which the Company operates; demographic changes; competition; fluctuations in interest rates; continued ability to attract and employ qualified personnel; costs and uncertainties related to the outcome of pending litigation; changes in business strategy or development plans; changes that occur in the securities markets; changes in governmental legislation or regulation; changes in credit quality; the availability of capital to fund the expansion of the Company’s business; economic, political and global changes arising from natural disasters; the war on terrorism; conflicts in the Middle East; and additional “Risk Factors” referenced in the Company’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, as supplemented from time to time. When relying on forward-looking statements to make decisions with respect to the Company, investors and others are cautioned to consider these and other risks and uncertainties. The Company can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. The forward-looking statements are made as of the date of this press release, and the Company does not intend, and assumes no obligation, to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.
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CENTENNIAL BANK HOLDINGS, INC. AND SUBSIDIARIES
Unaudited Consolidated Balance Sheets
| | March 31, 2008 | | December 31, 2007 | |
| | (In thousands) | |
Assets | | | | | |
Cash and due from banks | | $ | 51,770 | | $ | 51,611 | |
Federal funds sold | | 9,788 | | 745 | |
Cash and cash equivalents | | 61,558 | | 52,356 | |
Securities available for sale, at fair value | | 116,742 | | 118,964 | |
Securities held to maturity | | 14,106 | | 14,889 | |
Bank stocks, at cost | | 32,588 | | 32,464 | |
Total investments | | 163,436 | | 166,317 | |
| | | | | |
Loans, net of unearned discount | | 1,759,297 | | 1,781,647 | |
Less allowance for loan losses | | (26,048 | ) | (25,711 | ) |
Net loans | | 1,733,249 | | 1,755,936 | |
Loans, held for sale | | — | | 492 | |
Premises and equipment, net | | 69,519 | | 69,981 | |
Other real estate owned and foreclosed assets | | 1,715 | | 3,517 | |
Goodwill | | 250,748 | | 250,748 | |
Other intangible assets, net | | 31,056 | | 32,933 | |
Other assets | | 33,798 | | 39,384 | |
Total assets | | $ | 2,345,079 | | $ | 2,371,664 | |
| | | | | |
Liabilities and Stockholders’ Equity | | | | | |
Liabilities: | | | | | |
Deposits: | | | | | |
Noninterest-bearing demand | | $ | 473,247 | | $ | 515,299 | |
Interest-bearing demand | | 738,429 | | 732,156 | |
Savings | | 71,617 | | 71,944 | |
Time | | 426,789 | | 480,108 | |
Total deposits | | 1,710,082 | | 1,799,507 | |
Securities sold under agreements to repurchase and federal fund purchased | | 36,400 | | 23,617 | |
Borrowings | | 117,227 | | 63,715 | |
Subordinated debentures | | 41,239 | | 41,239 | |
Interest payable and other liabilities | | 18,670 | | 24,932 | |
Total liabilities | | 1,923,618 | | 1,953,010 | |
| | | | | |
Stockholders’ equity: | | | | | |
Common stock | | 65 | | 64 | |
Additional paid-in capital | | 618,382 | | 617,611 | |
Shares to be issued for deferred compensation obligations | | 585 | | 573 | |
Accumulated deficit | | (92,022 | ) | (95,196 | ) |
Accumulated other comprehensive loss | | (2,572 | ) | (1,472 | ) |
Treasury Stock | | (102,977 | ) | (102,926 | ) |
Total stockholders’ equity | | 421,461 | | 418,654 | |
Total liabilities and stockholders’ equity | | $ | 2,345,079 | | $ | 2,371,664 | |
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CENTENNIAL BANK HOLDINGS, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Income
| | Three Months Ended | |
| | March 31, 2008 | | March 31, 2007 | |
| | (In thousands, except share and per share data) | |
Interest income: | | | | | |
Loans, including fees | | $ | 31,040 | | $ | 39,738 | |
Investment securities: | | | | | |
Taxable | | 615 | | 621 | |
Tax-exempt | | 893 | | 1,412 | |
Dividends | | 470 | | 475 | |
Federal funds sold and other | | 385 | | 114 | |
Total interest income | | 33,403 | | 42,360 | |
Interest expense: | | | | | |
Deposits | | 9,795 | | 13,346 | |
Federal funds purchased and repurchase agreements | | 137 | | 301 | |
Borrowings | | 1,029 | | 932 | |
Subordinated debentures | | 792 | | 938 | |
Total interest expense | | 11,753 | | 15,517 | |
Net interest income | | 21,650 | | 26,843 | |
Provision for loan losses | | 875 | | 849 | |
Net interest income, after provision for loan losses | | 20,775 | | 25,994 | |
Noninterest income: | | | | | |
Customer service and other fees | | 2,276 | | 2,443 | |
Gain on sale of securities | | 138 | | — | |
Other | | 101 | | 124 | |
Total noninterest income | | 2,515 | | 2,567 | |
Noninterest expense: | | | | | |
Salaries and employee benefits | | 9,720 | | 10,974 | |
Occupancy expense | | 2,001 | | 2,121 | |
Furniture and equipment | | 1,314 | | 1,240 | |
Amortization of intangible assets | | 1,877 | | 2,195 | |
Other general and administrative | | 3,798 | | 4,152 | |
Total noninterest expense | | 18,710 | | 20,682 | |
Income before income taxes | | 4,580 | | 7,879 | |
Income tax expense | | 1,335 | | 2,470 | |
Net income | | $ | 3,245 | | $ | 5,409 | |
| | | | | |
Earnings per share–basic: | | $ | 0.06 | | $ | 0.10 | |
Earnings per share–diluted: | | $ | 0.06 | | $ | 0.10 | |
| | | | | |
Weighted average shares outstanding-basic | | 50,988,229 | | 54,792,527 | |
Weighted average shares outstanding-diluted | | 51,049,525 | | 54,902,229 | |
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Centennial Bank Holdings, Inc. and Subsidiaries
Unaudited Consolidated Average Balance Sheets
| | QTD Average | |
| | March 31,
2008 | | December 31,
2007 | | March 31, 2007 | |
| | (In thousands) | |
Assets | | | | | | | |
Interest earning assets | | | | | | | |
Loans, net of unearned discount | | $ | 1,767,582 | | $ | 1,823,363 | | $ | 1,909,713 | |
Securities | | 159,777 | | 178,218 | | 197,036 | |
Other earning assets | | 41,796 | | 19,715 | | 3,464 | |
Average earning assets | | 1,969,155 | | 2,021,296 | | 2,110,213 | |
Other assets | | 407,384 | | 461,056 | | 577,336 | |
| | | | | | | |
Total average assets | | $ | 2,376,539 | | $ | 2,482,352 | | $ | 2,687,549 | |
| | | | | | | |
Liabilities and Stockholders’ Equity | | | | | | | |
Average liabilities: | | | | | | | |
Average deposits: | | | | | | | |
Noninterest-bearing deposits | | $ | 472,802 | | $ | 487,805 | | $ | 483,293 | |
Interest-bearing deposits | | 1,277,606 | | 1,391,045 | | 1,448,340 | |
Average deposits | | 1,750,408 | | 1,878,850 | | 1,931,633 | |
Other interest-bearing liabilities | | 180,633 | | 112,402 | | 132,787 | |
Other liabilities | | 22,958 | | 23,220 | | 34,661 | |
Total average liabilities | | 1,953,999 | | 2,014,472 | | 2,099,081 | |
Average stockholders’ equity | | 422,540 | | 467,880 | | 588,468 | |
Total average liabilities and stockholders’ equity | | $ | 2,376,539 | | $ | 2,482,352 | | $ | 2,687,549 | |
11
Centennial Bank Holdings, Inc.
Unaudited Credit Quality Measures
| | Quarter Ended | |
| | March 31,
2008 | | December 31,
2007 | | September 30,
2007 | | June 30,
2007 | | March 31,
2007 | |
| | (Dollars in thousands) | |
Nonaccrual loans and leases, not restructured | | $ | 20,798 | | $ | 19,309 | | $ | 16,831 | | $ | 35,515 | | $ | 31,940 | |
Accruing loans past due 90 days or more | | 1 | | 527 | | 9 | | 122 | | 323 | |
Other real estate owned | | 1,715 | | 3,517 | | 3,401 | | 1,385 | | 861 | |
Total nonperforming assets | | $ | 22,514 | | $ | 23,353 | | $ | 20,241 | | $ | 37,022 | | $ | 33,124 | |
| | | | | | | | | | | |
Nonperforming loans | | $ | 20,799 | | $ | 19,836 | | $ | 16,840 | | $ | 35,637 | | $ | 32,263 | |
Other impaired loans | | — | | 3,492 | | 510 | | 20,208 | | 8,079 | |
Total impaired loans | | 20,799 | | 23,328 | | 17,350 | | 55,845 | | 40,342 | |
Allocated allowance for loan losses | | (5,368 | ) | (4,283 | ) | (4,028 | ) | (14,113 | ) | (7,673 | ) |
Net investment in impaired loans | | $ | 15,431 | | $ | 19,045 | | $ | 13,322 | | $ | 41,732 | | $ | 32,669 | |
| | | | | | | | | | | |
Charged-off loans | | $ | 743 | | $ | 1,729 | | $ | 20,079 | | $ | 5,473 | | $ | 1,692 | |
Recoveries | | (205 | ) | (436 | ) | (438 | ) | (809 | ) | (436 | ) |
Net charge-offs | | $ | 538 | | $ | 1,293 | | $ | 19,641 | | $ | 4,664 | | $ | 1,256 | |
| | | | | | | | | | | |
Provision for loan losses | | $ | 875 | | $ | 3,025 | | $ | 8,026 | | $ | 12,766 | | $ | 849 | |
| | | | | | | | | | | |
Allowance for loan losses | | $ | 26,048 | | $ | 25,711 | | $ | 23,979 | | $ | 35,594 | | $ | 27,492 | |
| | | | | | | | | | | |
Allowance for loan losses to loans, net of unearned discount | | 1.48 | % | 1.44 | % | 1.32 | % | 1.88 | % | 1.46 | % |
Allowance for loan losses to nonaccrual loans | | 125.24 | % | 133.16 | % | 142.47 | % | 100.22 | % | 86.07 | % |
Allowance for loan losses to nonperforming assets | | 115.70 | % | 110.10 | % | 118.47 | % | 96.14 | % | 83.00 | % |
Allowance for loan losses to nonperforming loans | | 125.24 | % | 129.62 | % | 142.39 | % | 99.88 | % | 85.21 | % |
| | | | | | | | | | | |
Nonperforming assets to loans, net of unearned discount, and other real estate owned | | 1.28 | % | 1.31 | % | 1.11 | % | 1.96 | % | 1.76 | % |
Annualized net charge-offs to average loans | | 0.12 | % | 0.28 | % | 4.16 | % | 0.99 | % | 0.27 | % |
Nonaccrual loans to loans, net of unearned discount | | 1.18 | % | 1.08 | % | 0.93 | % | 1.88 | % | 1.69 | % |
12
