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
SECOND QUARTER RESULTS
Quarterly Operating Highlights Include:
• Net income increases 229% year-to-year
• Total assets climb 48% to all time high
• Total deposits rise 44% to all time high
• Net loans jump 49% to all time high
• Company added to prestigious Russell 2000 stock index
CENTURY CITY, CALIFORNIA, JULY 7, 2005 – First Regional Bancorp (Nasdaq-NM: FRGB) today reported that net income for the second quarter of 2005 climbed 229 percent from the comparable period one year ago, reaching the single-highest quarterly level in the institution’s history.
For the three months ended June 30, 2005, net income totaled $6.4 million versus $1.9 million registered in last year’s second quarter. This translates to $1.49 per diluted share, an increase of nearly three-fold from $0.48 per diluted share in the second quarter of 2004. Net income for the first half of 2005 advanced more than 223 percent to $11.6 million, equal to $2.72 per diluted share, eclipsing the $3.6 million, or $0.95 per diluted share, in the corresponding six-months last year.
Jack A. Sweeney, chairman and chief executive officer, stated: “First Regional’s outstanding operating performance continued in the second period and first half of 2005. We are deeply gratified to have registered strong gains and all-time highs in net income, total assets, total deposits and net loans.”
Specifically, Mr. Sweeney noted “First Regional’s total assets climbed 48 percent to $1.45 billion from $980 million at June 30, 2004; total deposits grew to more than $1.2 billion at the close of the most recent period, rising 44 percent from $840 million one year earlier; and net loans reached $1.3 billion at June 30, 2005, an increase of 49 percent from the prior year.
Mr. Sweeney continued: “Among the factors positively impacting our results is First Regional’s continued growth, particularly in California’s strong real estate sector that represents an important pillar of our business base. In addition, the Federal Reserve’s recent increases in interest rates, which have improved our net-interest margins, combined with the operational efficiencies and economies of scale that result from an expanded asset base, have also had a favorable effect on our performance.”
Mr. Sweeney noted that in June 2005 First Regional was added to the Russell 2000 stock index. “Our addition to the Russell 2000 index is indicative of our sustained strong operating results and expanded market capitalization. It is both a validation of our business model and recognition of the considerable shareholder value which First Regional has created in recent years,” he commented.
Mr. Sweeney concluded, “While we are pleased with our past performance, we operate amid economic uncertainties. While it is impossible to forecast the course of future trends and events, our management team will continue to execute its proven business plan and build First Regional’s customer base on our hallmarks of efficiency and service.”
First Regional Bancorp is a bank holding company headquartered in Century City, California. 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.
1
CONSOLIDATED STATEMENTS OF CONDITION (UNAUDITED)
|
| (000’s omitted) |
| ||||
As of June 30 |
| 2005 |
| 2004 |
| ||
|
|
|
|
|
| ||
ASSETS: |
|
|
|
|
| ||
Cash and due from banks |
| $ | 63,006 |
| $ | 25,704 |
|
Investment securities |
| 18,560 |
| 6,238 |
| ||
Funds sold |
| 0 |
| 29,660 |
| ||
Federally guaranteed loans |
| 4,651 |
| 7,564 |
| ||
Other loans, net |
| 1,327,935 |
| 888,797 |
| ||
Premises and equipment |
| 3,674 |
| 2,295 |
| ||
Other real estate owned |
| 0 |
| 0 |
| ||
Other assets |
| 34,228 |
| 19,970 |
| ||
|
|
|
|
|
| ||
Total assets |
| $ | 1,452,054 |
| $ | 980,228 |
|
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|
|
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|
| ||
LIABILITIES AND CAPITAL: |
|
|
|
|
| ||
Demand deposits |
| $ | 420,282 |
| $ | 309,229 |
|
Savings deposits |
| 38,817 |
| 33,565 |
| ||
Money market deposits |
| 581,584 |
| 351,771 |
| ||
Time deposits |
| 170,129 |
| 145,723 |
| ||
|
|
|
|
|
| ||
Total deposits |
| 1,210,812 |
| 840,288 |
| ||
|
|
|
|
|
| ||
Funds purchased |
| 0 |
| 0 |
| ||
Federal Home Loan Bank advances |
| 100,000 |
| 40,000 |
| ||
Subordinated debentures |
| 41,238 |
| 35,619 |
| ||
Other liabilities |
| 10,261 |
| 9,316 |
| ||
|
|
|
|
|
| ||
Total liabilities |
| 1,362,311 |
| 925,223 |
| ||
|
|
|
|
|
| ||
Stated capital |
| 48,108 |
| 32,460 |
| ||
Retained earnings |
| 41,626 |
| 22,545 |
| ||
Net unrealized gains (losses) on available-for-sale securities |
| 9 |
| 0 |
| ||
|
|
|
|
|
| ||
Total capital |
| 89,743 |
| 55,005 |
| ||
|
|
|
|
|
| ||
Total liabilities and capital |
| $ | 1,452,054 |
| $ | 980,228 |
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|
| ||
Book value per share outstanding |
| $ | 22.32 |
| $ | 16.02 |
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|
|
| ||
Total shares outstanding |
| 4,020,146 |
| 3,433,516 |
|
2
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
|
| (000’s omitted) |
| (000’s omitted) |
| ||||||||
|
| Three Months Ended |
| Six Months Ended |
| ||||||||
|
| June 30 |
| June 30 |
| ||||||||
|
| 2005 |
| 2004 |
| 2005 |
| 2004 |
| ||||
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|
|
| ||||
Interest and fees on loans |
| $ | 24,130 |
| $ | 12,025 |
| $ | 44,584 |
| $ | 22,688 |
|
Interest on funds sold |
| 27 |
| 30 |
| 129 |
| 63 |
| ||||
Interest on securities |
| 114 |
| 13 |
| 151 |
| 29 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Revenue from earning assets |
| 24,271 |
| 12,068 |
| 44,864 |
| 22,780 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Interest on deposits |
| 2,927 |
| 1,172 |
| 5,158 |
| 2,164 |
| ||||
Interest on subordinated debentures |
| 595 |
| 454 |
| 1,120 |
| 829 |
| ||||
Interest on FHLB advances |
| 1,022 |
| 110 |
| 1,716 |
| 255 |
| ||||
Interest on funds purchased |
| 1 |
| 1 |
| 1 |
| 2 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Cost of funds |
| 4,545 |
| 1,737 |
| 7,995 |
| 3,250 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
|
| 19,726 |
| 10,331 |
| 36,869 |
| 19,530 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Provision for loan losses |
| 1,500 |
| 915 |
| 2,700 |
| 1,802 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net revenue from earning assets |
| 18,226 |
| 9,416 |
| 34,169 |
| 17,728 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Other revenue |
| 1,575 |
| 1,233 |
| 3,056 |
| 2,552 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Salaries and related benefits |
| 5,573 |
| 4,707 |
| 10,890 |
| 9,241 |
| ||||
Occupancy expense |
| 598 |
| 428 |
| 1,394 |
| 853 |
| ||||
Other operating expenses |
| 2,542 |
| 2,160 |
| 4,751 |
| 4,042 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Total operating expenses |
| 8,713 |
| 7,295 |
| 17,035 |
| 14,136 |
| ||||
|
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|
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|
|
|
| ||||
Income before provision for taxes |
| 11,088 |
| 3,354 |
| 20,190 |
| 6,144 |
| ||||
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|
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Provision for income taxes |
| 4,713 |
| 1,415 |
| 8,573 |
| 2,543 |
| ||||
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|
|
|
|
|
|
|
|
| ||||
Net income |
| 6,375 |
| $ | 1,939 |
| 11,617 |
| $ | 3,601 |
| ||
3
|
| (000’s omitted) |
| (000’s omitted) |
| ||||||||
|
| Three Months Ended |
| Six Months Ended |
| ||||||||
|
| June 30 |
| June 30 |
| ||||||||
|
| 2005 |
| 2004 |
| 2005 |
| 2004 |
| ||||
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| ||||
Net income per share |
|
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| ||||
Basic |
| $ | 1.59 |
| $ | 0.57 |
| $ | 2.90 |
| $ | 1.13 |
|
Diluted |
| $ | 1.49 |
| $ | 0.48 |
| $ | 2.72 |
| $ | 0.95 |
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| ||||
Average shares outstanding |
| 4,015,899 |
| 3,451,537 |
| 4,008,446 |
| 3,180,831 |
| ||||
Diluted average shares |
| 4,285,387 |
| 4,323,975 |
| 4,277,036 |
| 4,072,531 |
| ||||
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| ||||
Average Equity |
| $ | 86,723 |
| $ | 54,541 |
| $ | 83,517 |
| $ | 45,855 |
|
Average Assets |
| $ | 1,398,707 |
| $ | 914,911 |
| $ | 1,341,453 |
| $ | 867,378 |
|
Return on Average Equity (%) |
| 29.48 |
| 14.26 |
| 28.05 |
| 15.75 |
| ||||
Return on Average Assets (%) |
| 1.83 |
| 0.85 |
| 1.75 |
| 0.83 |
| ||||
Efficiency Ratio (%) |
| 40.90 |
| 63.08 |
| 42.67 |
| 64.02 |
| ||||
Number of Employees |
| 199 |
| 166 |
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|
|
|
| ||||
Assets per Employee (000s) |
| $ | 7,297 |
| $ | 5,905 |
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CREDIT QUALITY |
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| ||||
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Beginning Reserve for Loan Losses (000s) |
| $ | 13,355 |
| $ | 8,659 |
| $ | 11,825 |
| $ | 7,800 |
|
Loan Loss Provisions |
| 1,500 |
| 915 |
| 2,700 |
| 1,802 |
| ||||
Loan Recoveries |
| 0 |
| 0 |
| 130 |
| 113 |
| ||||
Loan Chargeoffs |
| 35 |
| 515 |
| 35 |
| 515 |
| ||||
Net Change in Allowance for Unfunded Loan Commitments |
| -3 |
| -24 |
| 197 |
| -165 |
| ||||
Ending Reserve for Loan Losses (000s) |
| $ | 14,817 |
| $ | 9,035 |
| $ | 14,817 |
| $ | 9,035 |
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Nonperforming Assets (000s) |
| $ | 853 |
| $ | 90 |
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|
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Nonperforming Assets / Gross Loans (%) |
| 0.06 |
| 0.01 |
|
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|
|
| ||||
Reserve for Loan Losses / Nonperforming Assets (%) |
| 1737.05 |
| 10038.89 |
|
|
|
|
| ||||
Reserve for Loan Losses / Gross Loans (%) |
| 1.10 |
| 1.00 |
|
|
|
|
|
4
|
| (000s omitted) |
| ||||||||||||||
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| For the Three Months Ended June 30, |
| ||||||||||||||
|
| 2005 |
| 2004 |
| ||||||||||||
|
| Average |
|
|
| Average |
| Average |
|
|
| Average |
| ||||
|
| Balance |
| Interest |
| Yield/Cost (%) |
| Balance |
| Interest |
| Yield/Cost (%) |
| ||||
|
|
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Gross Loans |
| $ | 1,297,410 |
| $ | 24,130 |
| 7.46 |
| $ | 842,530 |
| $ | 12,025 |
| 5.72 |
|
Funds Sold |
| 3,561 |
| 27 |
| 3.04 |
| 11,065 |
| 30 |
| 1.09 |
| ||||
Investment Securities |
| 18,390 |
| 114 |
| 2.49 |
| 5,283 |
| 13 |
| 0.99 |
| ||||
Total Earning Assets |
| $ | 1,319,361 |
| $ | 24,271 |
| 7.38 |
| $ | 858,878 |
| $ | 12,068 |
| 5.70 |
|
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|
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| ||||
Deposits |
| $ | 1,128,476 |
| $ | 2,927 |
| 1.04 |
| $ | 778,440 |
| $ | 1,172 |
| 0.60 |
|
Federal Home Loan Bank Advances |
| 135,275 |
| 1,022 |
| 3.03 |
| 43,242 |
| 110 |
| 1.02 |
| ||||
Subordinated Debentures |
| 41,238 |
| 595 |
| 5.79 |
| 35,619 |
| 454 |
| 5.11 |
| ||||
Funds Purchased |
| 272 |
| 1 |
| 1.47 |
| 830 |
| 1 |
| 0.48 |
| ||||
Total Bearing Liabilities |
| $ | 1,305,261 |
| $ | 4,545 |
| 1.40 |
| $ | 858,131 |
| $ | 1,737 |
| 0.82 |
|
|
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|
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|
|
| ||||
Net Interest Spread (1) |
|
|
|
|
| 5.98 |
|
|
|
|
| 4.88 |
| ||||
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|
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| ||||
Net Interest Margin (2) |
|
|
|
|
| 6.00 |
|
|
|
|
| 4.82 |
|
(1) Net interest spread represents the average yield earned on Earning Assets less the average cost of Bearing Liabilities.
(2) Net interest margin represents Net Interest Income divided by average Earning Assets.
5
|
| (000s omitted) |
| ||||||||||||||
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| For the Six Months Ended June 30, |
| ||||||||||||||
|
| 2005 |
| 2004 |
| ||||||||||||
|
| Average |
|
|
| Average |
| Average |
|
|
| Average |
| ||||
|
| Balance |
| Interest |
| Yield/Cost (%) |
| Balance |
| Interest |
| Yield/Cost (%) |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Gross Loans |
| $ | 1,243,089 |
| $ | 44,584 |
| 7.23 |
| $ | 796,626 |
| $ | 22,688 |
| 5.71 |
|
Funds Sold |
| 10,528 |
| 129 |
| 2.47 |
| 12,481 |
| 63 |
| 1.01 |
| ||||
Investment Securities |
| 13,060 |
| 151 |
| 2.33 |
| 5,931 |
| 29 |
| 0.98 |
| ||||
Total Earning Assets |
| $ | 1,266,677 |
| $ | 44,864 |
| 7.14 |
| $ | 815,038 |
| $ | 22,780 |
| 5.61 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Deposits |
| $ | 1,086,713 |
| $ | 5,158 |
| 0.96 |
| $ | 736,667 |
| $ | 2,164 |
| 0.59 |
|
Federal Home Loan Bank Advances |
| 123,612 |
| 1,716 |
| 2.80 |
| 48,365 |
| 255 |
| 1.06 |
| ||||
Subordinated Debentures |
| 41,238 |
| 1,120 |
| 5.48 |
| 32,305 |
| 829 |
| 5.15 |
| ||||
Funds Purchased |
| 182 |
| 1 |
| 1.11 |
| 614 |
| 2 |
| 0.65 |
| ||||
Total Bearing Liabilities |
| $ | 1,251,745 |
| $ | 7,995 |
| 1.29 |
| $ | 817,951 |
| $ | 3,250 |
| 0.80 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Net Interest Spread (1) |
|
|
|
|
| 5.85 |
|
|
|
|
| 4.81 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Net Interest Margin (2) |
|
|
|
|
| 5.84 |
|
|
|
|
| 4.81 |
|
(1) Net interest spread represents the average yield earned on Earning Assets less the average cost of Bearing Liabilities.
(2) Net interest margin represents Net Interest Income divided by average Earning Assets.
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.
6