AWBC – 2007 Q4 Earnings
January 31, 2008
Page 1 of 14
Exhibit 99.1
AMERICANWEST BANCORPORATION
NEWS RELEASE
AMERICANWEST BANCORPORATION ANNOUNCES
2007 FOURTH QUARTER FINANCIAL RESULTS
SPOKANE, WASHINGTON, January 31, 2008 (Business Wire) - AmericanWest Bancorporation (NASDAQ: AWBC) today announced its fourth quarter 2007 financial results, which included the following:
| | • | | Annualized loan growth of 10% |
| | • | | Tax-equivalent net interest margin of 4.97% |
| | • | | Provision for loan losses of $14.6 million |
| | • | | Non-interest revenue growth of 9% annualized over Q3 2007 |
| | • | | Non-performing assets/total assets ratio of 1.90% |
For the quarter ended December 31, 2007, the Company recognized a net loss of $3.3 million, or $0.19 per diluted share, as compared with net income of $5.3 million, or $0.31 per diluted share for the third quarter 2007 and $2.3 million, or $0.20 per diluted share, for the fourth quarter of 2006. The fourth quarter financial results were negatively impacted by a provision for loan losses of $14.6 million, or $0.85 per diluted share before tax, recognized principally due to deterioration in the residential construction and development segment of the loan portfolio. For the year ended December 31, 2007, the Company reported net income of $8.7 million, or $0.55 per diluted share, as compared with $7.6 million, or $0.67 per diluted share for 2006.
“Our fourth quarter operating results, although reflective of the difficult overall operating environment and continued deterioration of the residential real estate sector, were clearly a disappointment,” remarked Robert M. Daugherty, President and Chief Executive Officer. “We took a conservative approach with respect to downgrading and placing loans on non-accrual status, recognizing charge-offs and building the allowance to loan ratio by over 20 basis points during the fourth quarter, consistent with our credit risk management practices.”
Daugherty added, “While we expect that construction and development credit issues will remain a challenge for us in 2008, we also see continued opportunities in the C&I and SBA lending arena. And, of course, expense control will remain a top priority as we look to continue the significant operating efficiency progress made during 2007.”
Net Interest Margin:
The tax-equivalent net interest margin for the fourth quarter of 2007 was 4.97%, a decrease of 25 basis points from the prior quarter and a decrease of 5 basis points from the same period in 2006. The decrease from the prior quarter is due to a decline in the yield on earning assets of 39 basis points, offset by a 21 basis point reduction in the cost of interest bearing liabilities.
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January 31, 2008
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The average yield on loans for the fourth quarter of 2007 was 8.03%, a decrease of 42 basis points from the third quarter of 2007 and a decrease of 19 basis points from the same period in 2006. The decrease in the average yield on loans from the prior quarter was principally attributable to the re-pricing of approximately $813 million, or 46%, of the Company’s loan portfolio, which is indexed on a variable basis. The average prime rate for the fourth quarter of 2007 was 7.52%, down 66 basis points from the previous quarter. The average yield on loans was also negatively impacted by approximately 13 basis points as the result of the increased level of non-accrual loans.
The average cost of interest bearing deposits for the fourth quarter of 2007 was 3.43%, a decrease of 21 basis points from the third quarter of 2007 and a decrease of 20 basis points from the same period in 2006. The cost of borrowed funds, including FHLB advances and subordinated debt, was 5.51% for the fourth quarter of 2007, representing a decrease of 39 basis points from the prior quarter and 46 basis points from the same period in 2006. The decreases in the average cost of interest bearing deposits from the prior quarter and comparable prior year periods were principally due to the reduction in the paid rates on transaction accounts implemented during the fourth quarter of 2007 in response to lower short-term market interest rates, while the similar reduction in the average costs of borrowed funds was the result of lower short-term market rates such as LIBOR.
Loan Growth and Asset Quality:
Total loans increased by $42 million, or at an annualized growth rate 10%, during the fourth quarter of 2007. Approximately $36 million, or 86%, of the fourth quarter loan growth was generated by the Company’s offices located in South Jordan and Salt Lake City, Utah. Commercial and industrial loans increased by $9 million during the quarter (7% annualized growth), while agricultural loan balances declined by $11 million as a result of expected seasonal pay downs.
Total non-performing assets, net of government guarantees on loans, were 1.90% of total assets at December 31, 2007, as compared to 0.97% of total assets at September 30, 2007 and 0.86% of total assets at December 31, 2006. This increase was principally due to the $30 million of loans being placed on non-accrual status during the fourth quarter. Of the loans comprising this increase, nine had outstanding balances in excess of $500 thousand and totaled $29 million in the aggregate. Total foreclosed assets at December 31, 2007 totaled $1.2 million and consisted of four properties, as compared to $298 thousand at September 30, 2007. Non-performing loans, net of government guaranteed amounts, represented 2.21% of total loans at December 31, 2007, up 106 basis points from the prior quarter end level.
At December 31, 2007, the Company had approximately $26 million of loans which were not classified as non-performing, but internally identified as potential problem loans due to management’s concerns about the borrower’s financial condition. This represented approximately 1.5% of total outstanding loans, substantially unchanged from the percentage level at September 30, 2007 and December 31, 2006.
The Company recognized a provision for loan losses of $14.6 million, or 3.31% of average loans on an annualized basis, for the quarter ended December 31, 2007 as compared to $1.2 million, or 0.29% of average loans annualized for the prior quarter and $459 thousand, or 0.15% of average loans annualized, for same period in 2006. For the quarter ended December 31, 2007, net charge-offs were $10.4 million, or 2.35% of average
AWBC – 2007 Q4 Earnings
January 31, 2008
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loans annualized, as compared to 0.47% and 0.03% for the third quarter of 2007 and the same period in 2006, respectively. Of the total charge-offs recognized during the fourth quarter of 2007, $4.6 million was recorded in connection with specific impairments on two residential development loans which had a net combined carrying value of $8.5 million at December 31, 2007. In addition, a charge-off of $3.8 million was recognized in connection with four loans to a wood products manufacturing company due to the likely discontinuation of business operations and resulting curtailment of operating cash flows from the business. The remaining carrying value of these four loans as of December 31, 2007 was $3.8 million, a value that is fully supported by collateral appropriately discounted for current market valuation. For the year ended December 31, 2007, the provision for loan losses to total average loans and net charge-offs as a percentage of average loans were 1.09% and 0.93%, respectively.
The allowance for credit losses, which is comprised of the allowance for loan losses and reserve for unfunded commitments, was $26.6 million, or 1.51% of total loans, at December 31, 2007 as compared to $22.4 million, or 1.30% of total loans, at September 30, 2007. The allowance for credit losses represented 68% of total non-performing loans (net of government guarantees) as of December 31, 2007 as compared to 113% at September 30, 2007 and 139% at December 31, 2006.
Deposits and Borrowed Funds:
Total average deposits for the fourth quarter of 2007 were $1.57 billion, up $9.3 million over the third quarter of 2007. This growth was principally driven by increased average money market account balances of $30 million, offset by a $17 million reduction in average certificates of deposit. Total ending deposits at December 31, 2007 were $1.53 billion, down $68 million from September 30, 2007. This decrease was the result of lower demand deposit ($20 million), money market/savings ($21 million) and certificate of deposit ($27 million) balances.
Total FHLB and other borrowings at December 31, 2007 were $245 million, an increase of $113 million from September 30, 2007. This is mainly a result of loan growth during the quarter of $42 million while deposits declined $68 million and cash and cash equivalents declined $5 million.
Non-interest Income and Expense:
Non-interest income was $4.6 million for the quarter ended December 31, 2007 as compared to $4.5 million in the third quarter and $2.6 million for the same period in 2006. The increase from the prior quarter was due principally to increased deposit fees and service charges. During the fourth quarter of 2007, the sale of $1.7 million of recently originated SBA loans resulted in non-interest income of $69 thousand. These increases were offset by a decline in fees on mortgage loan sales of $51 thousand and reduction in gains on sales of foreclosed real estate of $84 thousand.
Non-interest expense was $18.4 million for the quarter ended December 31, 2007 as compared to $18.8 million for the quarter ended September 30, 2007 and $14.4 million for same period in 2006. The linked-quarter decrease was principally attributable to a reduction in salaries and benefits expense of $981 thousand. Net adjustments of performance-based incentive plan and other compensation-related accruals resulted in an expense reduction of approximately $1.2 million. This reduction was partially offset by the recognition of approximately $266 thousand of severance expense related to the consolidation of some back-office functions. Total occupancy and equipment related expense for the fourth quarter of 2007 was $3.5 million, representing an increase of $289 thousand over the third quarter of 2007. This increase was principally due to costs associated with the Company’s new Walker Center facility in Salt Lake City, Utah and relocation of the Sandpoint, Idaho financial center to a permanent facility during the fourth quarter.
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January 31, 2008
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During the fourth quarter the provision for unfunded commitments was reclassified from the provision for loan losses to the other non-interest expense category on the income statement. All prior periods have been adjusted to reflect this reclassification in the attached statistical supplement. The cumulative amount of this reclassification for the first three quarters of 2007 was $264 thousand.
The efficiency ratio improved to 63.3% for the quarter ended December 31, 2007, as compared to 63.5% in the prior quarter and 76.4% for the same period in 2006.
Income Taxes:
The effective tax benefit rate for the quarter ended December 31, 2007 was 40.4%. This rate reflected the impact of the significantly lower full year pre-tax income as compared to the previously estimated amounts on which the accruals for the first nine months of the year were based.
The full year 2007 effective tax rate of 31.0% was reduced by approximately 105 basis points as the result of certain adjustments related to the Company’s 2006 federal tax return, which was filed during the third quarter of 2007. Additionally, the 2007 effective tax rate was increased by approximately 95 basis points due to the recapture of certain tax credits recognized in prior periods.
Capital:
Total shareholders’ equity at December 31, 2007 was $284 million and total tangible shareholders’ equity was $139 million, or $8.10 per share. The tangible equity ratio was 7.06% and the Company’s and AmericanWest Bank’s regulatory capital ratios remained in excess of the requirements for “well capitalized” status as of December 31, 2007.
Earnings Conference Call:
The fourth quarter earnings conference call will be held Thursday, January 31, 2008 at 10:00 a.m. PDT (1:00 p.m. EDT). Management will discuss the fourth quarter 2007 operating results and provide an update on recent initiatives. Shareholders, analysts and other interested parties are invited to join the call. The telephone access number is (800) 860-2442 and no pass code is required.
About AmericanWest Bancorporation:
AmericanWest Bancorporation is a bank holding company whose principal subsidiary is AmericanWest Bank which includes Far West Bank, operating as an integrated division of AmericanWest Bank. AmericanWest Bank is a community bank with 63 financial centers and two loan production offices located in Washington, Northern Idaho and Utah. For further information on the Company, please visit our web site atwww.awbank.net/IR.
AWBC – 2007 Q4 Earnings
January 31, 2008
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This press release includes forward-looking statements, and AmericanWest Bancorporation intends for such statements to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements describe AmericanWest Bancorporation’s expectations regarding future events, including the performance of the construction and development loan portfolio, loan collateral valuations, growth prospects for commercial/industrial and SBA loans and expense control. Future events are difficult to predict and are subject to risk and uncertainty which could cause actual results to differ materially and adversely. Additional information regarding risks and uncertainties is included in AmericanWest Bancorporation’s periodic filings on Forms 10-K and 10-Q with the Securities and Exchange Commission. AmericanWest Bancorporation undertakes no obligation to revise or amend any forward-looking statements to reflect subsequent events or circumstances.
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AWBC – 2007 Q4 Earnings
January 31, 2008
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AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
Consolidated Statements of Income:
| | | | | | | | | | |
| | | For the three months ended: |
| | | 12/31/2007 | | | 9/30/2007 | | 12/31/2006 |
INTEREST INCOME | | | | | | | | | | |
Interest and fees on loans | | $ | 35,448 | | | $ | 36,378 | | $ | 24,904 |
Interest on securities | | | 811 | | | | 814 | | | 491 |
Other interest income | | | 66 | | | | 159 | | | 86 |
| | | | | | | | | | |
TOTAL INTEREST INCOME | | | 36,325 | | | | 37,351 | | | 25,481 |
| | | | | | | | | | |
INTEREST EXPENSE | | | | | | | | | | |
Interest on deposits | | | 10,494 | | | | 11,054 | | | 7,975 |
Interest on borrowings | | | 2,967 | | | | 2,807 | | | 1,667 |
| | | | | | | | | | |
TOTAL INTEREST EXPENSE | | | 13,461 | | | | 13,861 | | | 9,642 |
| | | | | | | | | | |
NET INTEREST INCOME | | | 22,864 | | | | 23,490 | | | 15,839 |
Provision for loan losses | | | 14,605 | | | | 1,231 | | | 459 |
| | | | | | | | | | |
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | | | 8,259 | | | | 22,259 | | | 15,380 |
| | | | | | | | | | |
NON-INTEREST INCOME | | | | | | | | | | |
Fees and service charges on deposits | | | 2,723 | | | | 2,588 | | | 1,505 |
Fees on mortgage loan sales | | | 889 | | | | 940 | | | 576 |
Other | | | 943 | | | | 922 | | | 484 |
| | | | | | | | | | |
TOTAL NON-INTEREST INCOME | | | 4,555 | | | | 4,450 | | | 2,565 |
| | | | | | | | | | |
NON-INTEREST EXPENSE | | | | | | | | | | |
Salaries and employee benefits | | | 10,026 | | | | 11,007 | | | 8,269 |
Equipment expense | | | 1,873 | | | | 1,699 | | | 1,115 |
Occupancy expense, net | | | 1,605 | | | | 1,490 | | | 1,161 |
Amortization of intangible assets | | | 1,063 | | | | 1,063 | | | 294 |
State business and occupation tax | | | 328 | | | | 335 | | | 289 |
Foreclosed real estate and other foreclosed assets expense | | | 155 | | | | 45 | | | 191 |
Other | | | 3,375 | | | | 3,156 | | | 3,032 |
| | | | | | | | | | |
TOTAL NON-INTEREST EXPENSE | | | 18,425 | | | | 18,795 | | | 14,351 |
| | | | | | | | | | |
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAX | | | (5,611 | ) | | | 7,914 | | | 3,594 |
PROVISION (BENEFIT) FOR INCOME TAX | | | (2,267 | ) | | | 2,565 | | | 1,343 |
| | | | | | | | | | |
NET INCOME (LOSS) | | $ | (3,344 | ) | | $ | 5,349 | | $ | 2,251 |
| | | | | | | | | | |
Basic earnings (loss) per common share | | $ | (0.19 | ) | | $ | 0.31 | | $ | 0.20 |
Diluted earnings (loss) per common share | | $ | (0.19 | ) | | $ | 0.31 | | $ | 0.20 |
Basic weighted average shares outstanding | | | 17,197,012 | | | | 17,194,189 | | | 11,383,248 |
Diluted weighted average shares outstanding | | | 17,276,477 | | | | 17,268,007 | | | 11,531,166 |
Ending book value per share | | $ | 16.52 | | | $ | 16.76 | | $ | 13.35 |
Ending tangible book value per share | | $ | 8.10 | | | $ | 8.20 | | $ | 9.79 |
Ending shares outstanding | | | 17,199,992 | | | | 17,195,834 | | | 11,388,315 |
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January 31, 2008
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AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
Consolidated Statements of Income:
| | | | | | |
| | | For the year ended: |
| | | 12/31/2007 | | 12/31/2006 |
INTEREST INCOME | | | | | | |
Interest and fees on loans | | $ | 130,980 | | $ | 91,743 |
Interest on securities | | | 2,931 | | | 1,901 |
Other interest income | | | 381 | | | 209 |
| | | | | | |
TOTAL INTEREST INCOME | | | 134,292 | | | 93,853 |
| | | | | | |
INTEREST EXPENSE | | | | | | |
Interest on deposits | | | 40,302 | | | 26,843 |
Interest on borrowings | | | 9,901 | | | 6,724 |
| | | | | | |
TOTAL INTEREST EXPENSE | | | 50,203 | | | 33,567 |
| | | | | | |
NET INTEREST INCOME | | | 84,089 | | | 60,286 |
Provision for loan losses | | | 17,341 | | | 5,376 |
| | | | | | |
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | | | 66,748 | | | 54,910 |
| | | | | | |
NON-INTEREST INCOME | | | | | | |
Fees and service charges on deposits | | | 9,199 | | | 5,526 |
Fees on mortgage loan sales | | | 3,175 | | | 1,713 |
Other | | | 3,723 | | | 2,036 |
| | | | | | |
TOTAL NON-INTEREST INCOME | | | 16,097 | | | 9,275 |
| | | | | | |
NON-INTEREST EXPENSE | | | | | | |
Salaries and employee benefits | | | 40,860 | | | 30,284 |
Equipment expense | | | 6,606 | | | 3,943 |
Occupancy expense, net | | | 5,710 | | | 4,167 |
Amortization of intangible assets | | | 3,480 | | | 982 |
State business and occupation tax | | | 1,290 | | | 1,238 |
Foreclosed real estate and other foreclosed assets expense | | | 322 | | | 750 |
Other | | | 11,928 | | | 10,834 |
| | | | | | |
TOTAL NON-INTEREST EXPENSE | | | 70,196 | | | 52,198 |
| | | | | | |
INCOME BEFORE PROVISION FOR INCOME TAX | | | 12,649 | | | 11,987 |
PROVISION FOR INCOME TAX | | | 3,918 | | | 4,357 |
| | | | | | |
NET INCOME | | $ | 8,731 | | $ | 7,630 |
| | | | | | |
Basic earnings per common share | | $ | 0.55 | | $ | 0.68 |
Diluted earnings per common share | | $ | 0.55 | | $ | 0.67 |
Basic weighted average shares outstanding | | | 15,766,041 | | | 11,182,526 |
Diluted weighted average shares outstanding | | | 15,863,583 | | | 11,354,654 |
Ending book value per share | | $ | 16.52 | | $ | 13.35 |
Ending tangible book value per share | | $ | 8.10 | | $ | 9.79 |
Ending shares outstanding | | | 17,199,992 | | | 11,388,315 |
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AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
Consolidated Statement of Condition:
| | | | | | | | | | |
| | | December 31,
2007 | | September 30,
2007 | | | December 31,
2006 |
| ASSETS | | | | | | | | | | |
Cash and due from banks | | $ | 46,591 | | $ | 50,818 | | | $ | 45,866 |
Overnight interest bearing deposits with other banks | | | 498 | | | 1,485 | | | | 9,863 |
| | | | | | | | | | |
Cash and cash equivalents | | | 47,089 | | | 52,303 | | | | 55,729 |
Securities, available-for-sale at fair value | | | 66,985 | | | 70,674 | | | | 39,518 |
Loans, net of allowance for loan losses | | | 1,738,838 | | | 1,700,895 | | | | 1,204,519 |
Loans, held for sale | | | 11,105 | | | 10,624 | | | | 2,913 |
Accrued interest receivable | | | 11,766 | | | 13,927 | | | | 8,311 |
FHLB stock | | | 7,801 | | | 7,801 | | | | 6,319 |
Premises and equipment, net | | | 47,426 | | | 45,182 | | | | 30,484 |
Foreclosed real estate and other foreclosed assets | | | 1,230 | | | 298 | | | | 644 |
Bank owned life insurance | | | 29,104 | | | 28,829 | | | | 19,716 |
Goodwill | | | 127,852 | | | 129,155 | | | | 33,073 |
Intangible assets | | | 16,942 | | | 18,005 | | | | 7,506 |
Other assets | | | 13,948 | | | 5,784 | | | | 7,796 |
| | | | | | | | | | |
TOTAL ASSETS | | $ | 2,120,086 | | $ | 2,083,477 | | | $ | 1,416,528 |
| | | | | | | | | | |
| LIABILITIES | | | | | | | | | | |
Non-interest bearing demand deposits | | $ | 342,701 | | $ | 362,387 | | | $ | 236,375 |
Interest bearing deposits: | | | | | | | | | | |
NOW, savings accounts and MMDA | | | 678,314 | | | 698,887 | | | | 476,852 |
Time, $100,000 and over | | | 288,204 | | | 307,326 | | | | 217,508 |
Other time | | | 220,208 | | | 228,612 | | | | 193,204 |
| | | | | | | | | | |
TOTAL DEPOSITS | | | 1,529,427 | | | 1,597,212 | | | | 1,123,939 |
FHLB advances | | | 208,052 | | | 109,516 | | | | 105,759 |
Other borrowings | | | 36,611 | | | 21,671 | | | | 307 |
Junior subordinated debt | | | 41,239 | | | 41,239 | | | | 20,620 |
Accrued interest payable | | | 5,339 | | | 5,937 | | | | 4,270 |
Other liabilities | | | 15,238 | | | 19,749 | | | | 9,596 |
| | | | | | | | | | |
TOTAL LIABILITIES | | | 1,835,906 | | | 1,795,324 | | | | 1,264,491 |
| STOCKHOLDERS’ EQUITY | | | | | | | | | | |
Common stock, no par | | | 253,150 | | | 253,266 | | | | 127,396 |
Retained earnings | | | 30,902 | | | 34,934 | | | | 24,576 |
Accumulated other comprehensive income (loss), net of tax | | | 128 | | | (47 | ) | | | 65 |
| | | | | | | | | | |
TOTAL STOCKHOLDERS’ EQUITY | | | 284,180 | | | 288,153 | | | | 152,037 |
| | | | | | | | | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | | $ | 2,120,086 | | $ | 2,083,477 | | | $ | 1,416,528 |
| | | | | | | | | | |
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AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
| | | | | | | | | |
| | | Three Months Ended | |
| | | 12/31/2007 | | | 9/30/2007 | | | 12/31/2006 | |
Financial Ratios, annualized: | | | | | | | | | |
Return on average assets | | -0.63 | % | | 1.03 | % | | 0.65 | % |
Return on average equity | | -4.57 | % | | 7.40 | % | | 5.92 | % |
Return on tangible average equity | | -9.24 | % | | 15.26 | % | | 8.10 | % |
Efficiency ratio | | 63.32 | % | | 63.46 | % | | 76.38 | % |
Non-interest income to average assets | | 0.86 | % | | 0.86 | % | | 0.74 | % |
Non-interest expenses to average assets | | 3.49 | % | | 3.63 | % | | 4.13 | % |
Net interest margin to average earning assets (1) | | 4.97 | % | | 5.22 | % | | 5.02 | % |
Ending shareholders’ equity to assets | | 13.40 | % | | 13.83 | % | | 10.73 | % |
Ending tangible shareholders’ equity to tangible assets | | 7.06 | % | | 7.28 | % | | 8.10 | % |
| | |
| | | Year Ended | | | | |
| | | 12/31/2007 | | | 12/31/2006 | | | | |
Year to Date Financial Ratios, annualized: | | | | | | | | | |
Return on average assets | | 0.46 | % | | 0.58 | % | | | |
Return on average equity | | 3.43 | % | | 5.33 | % | | | |
Return on tangible average equity | | 6.53 | % | | 6.98 | % | | | |
Efficiency ratio | | 66.59 | % | | 73.63 | % | | | |
Non-interest income to average assets | | 0.85 | % | | 0.71 | % | | | |
Non-interest expenses to average assets | | 3.72 | % | | 3.99 | % | | | |
Net interest margin to average earning assets (1) | | 5.09 | % | | 5.06 | % | | | |
| (1) | Presented on a tax equivalent basis for tax exempt securities. |
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AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
| | | | | | | | | | | | |
| | | 12/31/2007 | | | 9/30/2007 | | | 12/31/2006 | |
Loan Portfolio: | | | | | | | | | | | | |
Commercial real estate | | $ | 853,874 | | | $ | 821,844 | | | $ | 651,386 | |
Commercial and industrial | | | 480,458 | | | | 471,771 | | | | 283,889 | |
Agricultural | | | 141,401 | | | | 152,149 | | | | 141,646 | |
Residential construction | | | 111,303 | | | | 123,343 | | | | 47,235 | |
Residential mortgage | | | 134,811 | | | | 110,940 | | | | 74,222 | |
Installment and other | | | 46,025 | | | | 45,502 | | | | 22,508 | |
| | | | | | | | | | | | |
Total loans | | | 1,767,872 | | | | 1,725,549 | | | | 1,220,886 | |
Allowance for loan losses | | | (25,258 | ) | | | (21,023 | ) | | | (15,136 | ) |
Deferred loan fees, net of deferred costs | | | (3,776 | ) | | | (3,631 | ) | | | (1,231 | ) |
| | | | | | | | | | | | |
Net loans | | $ | 1,738,838 | | | $ | 1,700,895 | | | $ | 1,204,519 | |
| | | | | | | | | | | | |
Non-performing Assets: | | | | | | | | | | | | |
Accruing loans over 90 days past due | | $ | 0 | | | $ | 0 | | | $ | 0 | |
Non-accrual loans (1) | | | 39,098 | | | | 19,846 | | | | 11,500 | |
| | | | | | | | | | | | |
Total non-performing loans | | $ | 39,098 | | | $ | 19,846 | | | $ | 11,500 | |
Foreclosed real estate and other foreclosed assets | | | 1,230 | | | | 298 | | | | 644 | |
| | | | | | | | | | | | |
Total non-performing assets | | $ | 40,328 | | | $ | 20,144 | | | $ | 12,144 | |
| | | | | | | | | | | | |
Allowance for Credit Losses: | | | | | | | | | | | | |
Allowance for loan losses | | $ | 25,258 | | | $ | 21,023 | | | $ | 15,136 | |
Reserve for unfunded commitments | | | 1,374 | | | | 1,402 | | | | 881 | |
| | | | | | | | | | | | |
Allowance for credit losses | | $ | 26,632 | | | $ | 22,425 | | | $ | 16,017 | |
| | | | | | | | | | | | |
Credit Quality Ratios: | | | | | | | | | | | | |
Non-performing loans to total gross loans (1) | | | 2.21 | % | | | 1.15 | % | | | 0.94 | % |
Non-performing assets to total assets (1) | | | 1.90 | % | | | 0.97 | % | | | 0.86 | % |
Allowance for loan loss to total gross loans | | | 1.43 | % | | | 1.22 | % | | | 1.24 | % |
Allowance for credit losses to total gross loans | | | 1.51 | % | | | 1.30 | % | | | 1.31 | % |
Allowance for credit losses to non-performing loans (1) | | | 68.12 | % | | | 113.00 | % | | | 139.28 | % |
| (1) | Amounts and ratios shown net of government guarantees on non-performing loans of $992, $1,096, $3,978 and respectively. |
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AWBC – 2007 Q4 Earnings
January 31, 2008
Page 11 of 14
AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
| | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | Year Ended | |
| | | 12/31/2007 | | | 9/30/2007 | | | 12/31/2006 | | | 12/31/2007 | | | 12/31/2006 | |
Allowance for Loan Losses: | | | | | | | | | | | | | | | | | | | | |
Balance, beginning of period | | $ | 21,023 | | | $ | 21,830 | | | $ | 14,761 | | | $ | 15,136 | | | $ | 13,895 | |
Provision for loan losses | | | 14,605 | | | | 1,231 | | | | 459 | | | | 17,341 | | | | 5,376 | |
Allowance related to acquired loans | | | — | | | | — | | | | — | | | | 7,529 | | | | 2,068 | |
Loans charged-off | | | (10,502 | ) | | | (2,148 | ) | | | (371 | ) | | | (15,270 | ) | | | (7,021 | ) |
Recoveries | | | 132 | | | | 110 | | | | 287 | | | | 522 | | | | 818 | |
| | | | | | | | | | | | | | | | | | | | |
Balance, end of period | | $ | 25,258 | | | $ | 21,023 | | | $ | 15,136 | | | $ | 25,258 | | | $ | 15,136 | |
| | | | | | | | | | | | | | | | | | | | |
Reserve for Unfunded Commitments: | | | | | | | | | | | | | | | | | | | | |
Balance, beginning of period | | $ | 1,402 | | | $ | 1,383 | | | $ | 716 | | | $ | 881 | | | $ | 466 | |
Provision for unfunded commitments | | | (28 | ) | | | 19 | | | | 165 | | | | 236 | | | | 415 | |
Reserve related to acquired unfunded commitments | | | — | | | | — | | | | — | | | | 257 | | | | — | |
| | | | | | | | | | | | | | | | | | | | |
Balance, end of period | | $ | 1,374 | | | $ | 1,402 | | | $ | 881 | | | $ | 1,374 | | | $ | 881 | |
| | | | | | | | | | | | | | | | | | | | |
Net charge-offs to average gross loans (1) | | | 2.35 | % | | | 0.47 | % | | | 0.03 | % | | | 0.93 | % | | | 0.54 | % |
Provision for loan losses to average gross loans (1) | | | 3.31 | % | | | 0.29 | % | | | 0.15 | % | | | 1.09 | % | | | 0.47 | % |
| (1) | Annualized ratio includes loans held for sale and non-accrual loans in average gross loans. |
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AWBC – 2007 Q4 Earnings
January 31, 2008
Page 12 of 14
AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
Quarter to Date Net Interest Margin:
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
Dec 31, 2007 | | | Three Months Ended
Sept 30, 2007 | | | Three Months Ended
Dec 31, 2006 | |
($ in thousands) | | Average
Balance | | Interest | | % | | | Average
Balance | | Interest | | % | | | Average
Balance | | Interest | | % | |
| Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans (1) | | $ | 1,751,528 | | $ | 35,448 | | 8.03 | % | | $ | 1,707,745 | | $ | 36,378 | | 8.45 | % | | $ | 1,201,896 | | $ | 24,904 | | 8.22 | % |
Taxable securities | | | 51,866 | | | 636 | | 4.86 | % | | | 46,506 | | | 609 | | 5.20 | % | | | 31,342 | | | 388 | | 4.91 | % |
Non-taxable securities (2) | | | 17,079 | | | 265 | | 6.16 | % | | | 21,196 | | | 311 | | 5.82 | % | | | 10,080 | | | 154 | | 6.06 | % |
FHLB Stock | | | 7,801 | | | 16 | | 0.81 | % | | | 7,801 | | | 12 | | 0.61 | % | | | 6,319 | | | 6 | | 0.38 | % |
Overnight deposits with other banks and other | | | 3,616 | | | 50 | | 5.49 | % | | | 10,635 | | | 147 | | 5.48 | % | | | 6,741 | | | 80 | | 4.71 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total interest earning assets | | | 1,831,890 | | | 36,415 | | 7.89 | % | | | 1,793,883 | | | 37,457 | | 8.28 | % | | | 1,256,378 | | | 25,532 | | 8.06 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Non-interest earning assets | | | 260,105 | | | | | | | | | 260,876 | | | | | | | | | 121,056 | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 2,091,995 | | | | | | | | $ | 2,054,759 | | | | | | | | $ | 1,377,434 | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Liabilities | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest bearing demand deposits | | $ | 143,255 | | $ | 237 | | 0.66 | % | | $ | 143,054 | | $ | 313 | | 0.87 | % | | $ | 90,849 | | $ | 168 | | 0.73 | % |
Savings and MMDA deposits | | | 559,809 | | | 3,993 | | 2.83 | % | | | 531,447 | | | 4,166 | | 3.11 | % | | | 379,385 | | | 3,071 | | 3.21 | % |
Time deposits | | | 511,912 | | | 6,264 | | 4.85 | % | | | 529,283 | | | 6,575 | | 4.93 | % | | | 401,040 | | | 4,736 | | 4.68 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total interest bearing deposits | | | 1,214,976 | | | 10,494 | | 3.43 | % | | | 1,203,784 | | | 11,054 | | 3.64 | % | | | 871,274 | | | 7,975 | | 3.63 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Overnight borrowings | | | 33,479 | | | 398 | | 4.72 | % | | | 23,455 | | | 328 | | 5.55 | % | | | 26,148 | | | 351 | | 5.33 | % |
Junior subordinated debt | | | 41,239 | | | 753 | | 7.24 | % | | | 41,239 | | | 774 | | 7.45 | % | | | 20,620 | | | 443 | | 8.52 | % |
Other borrowings | | | 138,861 | | | 1,816 | | 5.19 | % | | | 124,004 | | | 1,705 | | 5.45 | % | | | 64,080 | | | 873 | | 5.41 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total interest bearing liabilities | | | 1,428,555 | | | 13,461 | | 3.74 | % | | | 1,392,482 | | | 13,861 | | 3.95 | % | | | 982,122 | | | 9,642 | | 3.89 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Non-interest bearing demand deposits | | | 351,653 | | | | | | | | | 353,587 | | | | | | | | | 233,191 | | | | | | |
Other non-interest bearing liabilities | | | 21,582 | | | | | | | | | 21,919 | | | | | | | | | 11,163 | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities | | | 1,801,790 | | | | | | | | | 1,767,988 | | | | | | | | | 1,226,476 | | | | | | |
| Stockholders’ Equity | | | 290,205 | | | | | | | | | 286,771 | | | | | | | | | 150,958 | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities and stockholders’ equity | | $ | 2,091,995 | | | | | | | | $ | 2,054,759 | | | | | | | | $ | 1,377,434 | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest income and spread | | | | | $ | 22,954 | | 4.15 | % | | | | | $ | 23,596 | | 4.33 | % | | | | | $ | 15,890 | | 4.17 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest margin to average earning assets | | | | | | | | 4.97 | % | | | | | | | | 5.22 | % | | | | | | | | 5.02 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Includes loans held for sale and non-accrual loans. |
| (2) | Tax-exempt securities income has been presented using a tax equivalent basis and an assumed tax rate of 34%. |
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AWBC – 2007 Q4 Earnings
January 31, 2008
Page 13 of 14
AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
Year to Date Net Interest Margin:
| | | | | | | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2007 | | | 2006 | |
($ in thousands) | | Average
Balance | | Interest | | % | | | Average
Balance | | Interest | | % | |
| Assets | | | | | | | | | | | | | | | | | | |
Loans (1) | | $ | 1,585,078 | | $ | 130,980 | | 8.26 | % | | $ | 1,145,558 | | $ | 91,743 | | 8.01 | % |
Taxable securities | | | 44,195 | | | 2,240 | | 5.07 | % | | | 31,069 | | | 1,504 | | 4.84 | % |
Nontaxable securities (2) | | | 17,127 | | | 1,047 | | 6.11 | % | | | 9,919 | | | 601 | | 6.06 | % |
FHLB Stock | | | 7,367 | | | 45 | | 0.61 | % | | | 6,122 | | | 6 | | 0.10 | % |
Overnight deposits with other banks and other | | | 5,970 | | | 336 | | 5.63 | % | | | 3,945 | | | 203 | | 5.15 | % |
| | | | | | | | | | | | | | | | | | |
Total interest earning assets | | | 1,659,737 | | | 134,648 | | 8.11 | % | | | 1,196,613 | | | 94,057 | | 7.86 | % |
| | | | | | | | | | | | | | | | | | |
Noninterest earning assets | | | 226,912 | | | | | | | | | 110,739 | | | | | | |
| | | | | | | | | | | | | | | | | | |
Total assets | | $ | 1,886,649 | | | | | | | | $ | 1,307,352 | | | | | | |
| | | | | | | | | | | | | | | | | | |
| Liabilities | | | | | | | | | | | | | | | | | | |
Interest bearing demand deposits | | $ | 130,553 | | $ | 996 | | 0.76 | % | | $ | 88,936 | | $ | 650 | | 0.73 | % |
Savings and MMDA deposits | | | 500,367 | | | 15,227 | | 3.04 | % | | | 351,697 | | | 10,246 | | 2.91 | % |
Time deposits | | | 493,323 | | | 24,079 | | 4.88 | % | | | 376,340 | | | 15,947 | | 4.24 | % |
| | | | | | | | | | | | | | | | | | |
Total interest bearing deposits | | | 1,124,243 | | | 40,302 | | 3.58 | % | | | 816,973 | | | 26,843 | | 3.29 | % |
| | | | | | | | | | | | | | | | | | |
Overnight borrowings | | | 34,422 | | | 1,856 | | 5.39 | % | | | 39,056 | | | 2,019 | | 5.17 | % |
Junior subordinated debt | | | 36,720 | | | 2,754 | | 7.50 | % | | | 18,349 | | | 1,554 | | 8.47 | % |
Other borrowings | | | 98,819 | | | 5,291 | | 5.35 | % | | | 61,585 | | | 3,151 | | 5.12 | % |
| | | | | | | | | | | | | | | | | | |
Total interest bearing liabilities | | | 1,294,204 | | | 50,203 | | 3.88 | % | | | 935,963 | | | 33,567 | | 3.59 | % |
| | | | | | | | | | | | | | | | | | |
Noninterest bearing demand deposits | | | 318,878 | | | | | | | | | 218,230 | | | | | | |
Other noninterest bearing liabilities | | | 19,301 | | | | | | | | | 9,955 | | | | | | |
| | | | | | | | | | | | | | | | | | |
Total liabilities | | | 1,632,383 | | | | | | | | | 1,164,148 | | | | | | |
| Stockholders’ Equity | | | 254,266 | | | | | | | | | 143,204 | | | | | | |
| | | | | | | | | | | | | | | | | | |
Total liabilities and stockholders’ equity | | $ | 1,886,649 | | | | | | | | $ | 1,307,352 | | | | | | |
| | | | | | | | | | | | | | | | | | |
Net interest income and spread | | | | | $ | 84,445 | | 4.23 | % | | | | | $ | 60,490 | | 4.27 | % |
| | | | | | | | | | | | | | | | | | |
Net interest margin to average earning assets | | | | | | | | 5.09 | % | | | | | | | | 5.06 | % |
| | | | | | | | | | | | | | | | | | |
| (1) | Includes loans held for sale and non-accrual loans. |
| (2) | Tax-exempt securities income has been presented using a tax equivalent basis and an assumed tax rate of 34%. |
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AWBC – 2007 Q4 Earnings
January 31, 2008
Page 14 of 14
AmericanWest Bancorporation
Selected Consolidated Financial Highlights
($ in thousands, except per share data and ratios; unaudited)
Year to Date Organic Growth:
| | | | | | | | | | | | |
| | | Loans | | | Deposits | | | Assets | |
As reported December 31, 2007 | | $ | 1,767,872 | | | $ | 1,529,427 | | | $ | 2,120,086 | |
less: December 31, 2006 balances | | | 1,220,886 | | | | 1,123,939 | | | | 1,416,528 | |
| | | | | | | | | | | | |
Total growth year to date | | $ | 546,986 | | | $ | 405,488 | | | $ | 703,558 | |
less: acquisition of FWB | | | 350,891 | | | | 383,386 | | | | 546,000 | |
| | | | | | | | | | | | |
Organic growth | | $ | 196,095 | | | $ | 22,102 | | | $ | 157,558 | |
| | | | | | | | | | | | |
Annualized organic growth rate | | | 16.1 | % | | | 2.0 | % | | | 11.1 | % |
Contacts:
AmericanWest Bancorporation
Robert M. Daugherty
President and CEO
509.344.5329
bdaugherty@awbank.net
or
Patrick J. Rusnak
Chief Operating Officer
509.232.1963
prusnak@awbank.net
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