Exhibit 99
News Release
First Regional | 1801 Century Park East | Jack A. Sweeney |
Bancorp | Century City, California 90067 | Board Chairman |
| Telephone (310) 552-1776 | Chief Executive Officer |
| Facsimile (310) 552-1772 |
|
IMMEDIATE RELEASE
FIRST REGIONAL BANCORP POSTS RECORD RESULTS IN THIRD QUARTER
• Net income for the quarter increases nearly two and one half fold from prior year
• Total assets grow 67%, surpassing $1 billion for the first time
• Net loans rise by 72% to $974 million
• Total deposits expand to $949 million, up 62% from last year
• Record nine months earnings are more than double the 2003 total.
CENTURY CITY, CALIFORNIA, OCTOBER 19, 2004 – Continuing its strong profit performance, First Regional Bancorp (Nasdaq: FRGB) posted the highest quarterly earnings in the company’s history, as net income for the three months ended September 30, 2004 surged 144% from the year earlier level. Net income for the first nine months of 2004 also reached a new historic high, more than doubling last year’s record results.
For the three months ended September 30, 2004, net income rose to $3.2 million from $1.3 million in the prior year. Net income per (diluted) share was $0.79, an increase from $0.44 per (diluted) share one year earlier. For the first nine months, First Regional’s net income advanced to $6.8 million, equal to $1.80 per (diluted) share from $3.3 million or $1.14 per (diluted) share for the corresponding months of 2003. Per share results for 2004 reflect an increase in shares outstanding, due to the company’s successful private placements of securities in 2003 and the first quarter of 2004.
Jack A. Sweeney, chairman and chief executive officer, commented: “Our ongoing efforts to strategically position our bank in key markets and to build a solid infrastructure are being well rewarded. The bank’s outstanding performance reflects a substantial expansion of lending activity, coupled with robust growth in deposits. Lending was driven by our expanding team of talented bankers taking advantage of opportunities to add quality business in a favorable market. Additionally, our profitability benefited from the Federal Reserve Board’s moves designed to gradually increase interest rates.”
“Exceeding $1 billion in assets is a landmark achievement for our company, and it comes in the same year that we celebrate First Regional’s twenty-five years of service to Southern California’s business community,” Mr. Sweeney noted, adding: “In terms of the standard measurements of bank performance, First Regional continues to achieve substantial improvement. Our third quarter return on average equity was 22.42%, compared with 15.65% last year, and our return on average assets rose to 1.25% from 0.85%. First Regional’s efficiency ratio improved to 51.92% from 62.36% one year earlier, demonstrating the company’s progress in managing operating expenses.”
Mr. Sweeney continued: “Based on our success thus far in 2004, it appears likely that we will exceed our earnings targets for the year. These results once again demonstrate that our strategically-placed regional offices throughout Southern California, our Trust and Investment Division, plus our First Regional Merchant Services and Trust Administration Services business units, continue to contribute to our company’s success.”
He concluded: “The third quarter was an exceptional period of success for us, reflecting a great deal of hard work by our entire team. First Regional continues to achieve profitable growth while adhering to a conservative philosophy based on asset quality and a strong capital base. Despite uncertainties concerning interest rates, the economy, and the international scene, we look to the future with confidence and a realistic sense of optimism regarding our prospects for further success.”
1
First Regional Bancorp is a bank holding company headquartered in Century City. Its subsidiary, First Regional Bank, specializes in providing businesses and professionals with the management expertise of a major bank and the personalized service of an independent.
(over)
CONSOLIDATED STATEMENTS OF CONDITION (UNAUDITED)
|
| (000’s omitted) |
| ||||
As of September 30 |
| 2004 |
| 2003 |
| ||
|
|
|
|
|
| ||
ASSETS: |
|
|
|
|
| ||
Cash and due from banks |
| $ | 67,320 |
| $ | 26,491 |
|
Investment securities |
| 5,968 |
| 4,854 |
| ||
Funds sold |
| 430 |
| 25,820 |
| ||
Federally guaranteed loans |
| 6,924 |
| 11,225 |
| ||
Other loans, net |
| 966,655 |
| 555,516 |
| ||
Premises and equipment |
| 2,580 |
| 1,768 |
| ||
Other real estate owned |
| 0 |
| 0 |
| ||
Other assets |
| 20,630 |
| 15,120 |
| ||
|
|
|
|
|
| ||
Total assets |
| $ | 1,070,507 |
| $ | 640,794 |
|
|
|
|
|
|
| ||
LIABILITIES AND CAPITAL: |
|
|
|
|
| ||
Demand deposits |
| $ | 358,816 |
| $ | 234,265 |
|
Savings deposits |
| 35,568 |
| 28,168 |
| ||
Money market deposits |
| 412,639 |
| 230,511 |
| ||
Time deposits |
| 142,035 |
| 93,374 |
| ||
|
|
|
|
|
| ||
Total deposits |
| 949,058 |
| 586,318 |
| ||
|
|
|
|
|
| ||
Funds purchased |
| 0 |
| 0 |
| ||
Federal Home Loan Bank advances |
| 20,000 |
| 0 |
| ||
Subordinated debentures |
| 35,559 |
| 12,887 |
| ||
Other liabilities |
| 7,490 |
| 8,012 |
| ||
|
|
|
|
|
| ||
Total liabilities |
| 1,012,107 |
| 607,217 |
| ||
|
|
|
|
|
| ||
Stated capital |
| 32,662 |
| 15,776 |
| ||
Retained earnings |
| 25,737 |
| 17,801 |
| ||
Net unrealized gains (losses) on available-for-sale securities |
| 1 |
| 0 |
| ||
|
|
|
|
|
| ||
Total capital |
| 58,400 |
| 33,577 |
| ||
|
|
|
|
|
| ||
Total liabilities and capital |
| $ | 1,070,507 |
| $ | 640,794 |
|
|
|
|
|
|
| ||
Book value per share outstanding |
| $ | 16.96 |
| $ | 11.79 |
|
|
|
|
|
|
| ||
Total shares outstanding |
| 3,442,655 |
| 2,846,779 |
|
2
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
|
| (000’s omitted) |
| ||||||||||
|
| Three Months Ended |
| Nine Months Ended |
| ||||||||
|
| 2004 |
| 2003 |
| 2004 |
| 2003 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Interest and fees on loans |
| $ | 14,343 |
| $ | 8,214 |
| $ | 37,031 |
| $ | 22,162 |
|
Interest on funds sold |
| 47 |
| 69 |
| 110 |
| 191 |
| ||||
Interest on securities |
| 22 |
| 19 |
| 51 |
| 53 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Revenue from earning assets |
| 14,412 |
| 8,302 |
| 37,192 |
| 22,406 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Interest on deposits |
| 1,532 |
| 733 |
| 3,696 |
| 1,895 |
| ||||
Interest on subordinated debentures |
| 477 |
| 142 |
| 1,306 |
| 450 |
| ||||
Interest on FHLB advances |
| 109 |
| 0 |
| 364 |
| 37 |
| ||||
Interest on funds purchased |
| 0 |
| 1 |
| 2 |
| 6 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Cost of funds |
| 2,118 |
| 876 |
| 5,368 |
| 2,388 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
|
| 12,294 |
| 7,426 |
| 31,824 |
| 20,018 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Provision for loan losses |
| 1,100 |
| 1,000 |
| 2,902 |
| 1,750 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net revenue from earning assets |
| 11,194 |
| 6,426 |
| 28,922 |
| 18,268 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Other revenue |
| 1,333 |
| 1,129 |
| 3,885 |
| 3,263 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Salaries and related benefits |
| 4,452 |
| 3,456 |
| 13,693 |
| 10,122 |
| ||||
Occupancy expense |
| 427 |
| 381 |
| 1,280 |
| 1,071 |
| ||||
Other operating expenses |
| 2,196 |
| 1,498 |
| 6,238 |
| 4,774 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Total operating expenses |
| 7,075 |
| 5,335 |
| 21,211 |
| 15,967 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Income before provision for taxes |
| 5,452 |
| 2,220 |
| 11,596 |
| 5,564 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Provision for income taxes |
| 2,260 |
| 914 |
| 4,803 |
| 2,295 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net income |
| 3,192 |
| 1,306 |
| 6,793 |
| 3,269 |
| ||||
(over)
3
|
| (000’s omitted) |
| ||||||||||
|
| Three Months Ended |
| Nine Months Ended |
| ||||||||
|
| 2004 |
| 2003 |
| 2004 |
| 2003 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net income per share |
|
|
|
|
|
|
|
|
| ||||
Basic |
| $ | 0.93 |
| $ | 0.46 |
| $ | 2.09 |
| $ | 1.18 |
|
Diluted |
| $ | 0.79 |
| $ | 0.44 |
| $ | 1.80 |
| $ | 1.14 |
|
|
|
|
|
|
|
|
|
|
| ||||
Average shares outstanding |
| 3,436,790 |
| 2,844,800 |
| 3,257,946 |
| 2,773,449 |
| ||||
Diluted average shares |
| 4,185,222 |
| 2,963,586 |
| 4,003,958 |
| 2,873,175 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
RATIO ANALYSIS |
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Return on Average Equity (%) |
| 22.42 |
| 15.65 |
| 18.30 |
| 14.15 |
| ||||
Return on Average Assets (%) |
| 1.25 |
| 0.85 |
| 0.99 |
| 0.79 |
| ||||
Efficiency Ratio (%) |
| 51.92 |
| 62.36 |
| 59.40 |
| 68.58 |
| ||||
Assets per Employee ($000s) |
| 6,014 |
| 4,330 |
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Nonperforming Assets ($000s) |
| 49 |
| 962 |
|
|
|
|
| ||||
Reserve for Loan Losses ($000s) |
| 10,300 |
| 7,000 |
|
|
|
|
| ||||
Nonperforming Assets / Gross Loans (%) |
| 0.00 |
| 0.17 |
|
|
|
|
| ||||
Reserve for Loan Losses / Nonperforming Assets (%) |
| 21,020.41 |
| 727.65 |
|
|
|
|
| ||||
Reserve for Loan Losses / Gross Loans (%) |
| 1.05 |
| 1.22 |
|
|
|
|
| ||||
Average Assets |
| 1,026,406 |
| 609,374 |
| 920,774 |
| 552,529 |
| ||||
Average Equity |
| 57,102 |
| 33,114 |
| 49,632 |
| 30,895 |
| ||||
Number of Employees |
| 178 |
| 148 |
|
|
|
|
|
This report includes “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. All statements, other than statements of historical fact, included herein may constitute forward-looking statements. Although First Regional believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from First Regional’s expectations include fluctuations in interest rates, inflation, government regulations, and economic conditions and competition in the geographic and business areas in which First Regional conducts its operations.
4