Exhibit 99 (a)
Bank of Granite Corporation
| For Release: | July 8, 2002 |
BANK OF GRANITE REPORTS INCREASED EARNINGS
FOR SECOND QUARTER AND SIX MONTHS
Despite a rather weak economy, Bank of Granite Corporation (Nasdaq: GRAN) has reported increased earnings for the second quarter and for the six month period, both ending June 30, 2002.
For the second quarter, net income was $3,451,535 compared with $2,630,507 for the second quarter of 2001—an increase of 31.2%. Second quarter earnings per share were 25¢ vs 19¢ in 2001, a 31.6% increase.
For the six-month period, net income was $7,233,874 compared with $6,478,613—an increase of 11.7%. Per share earnings for the six month period were 53¢ vs 46¢ in the comparable 2001 period, an increase of 15.2%. Per share earnings for both the quarter and the six-month period are adjusted for the 5-for-4 stock split paid on May 31, 2002.
John A. Forlines, Jr., Chairman and Chief Executive Officer, said these earnings were accomplished during a period of “much economic uncertainty.” He said loan demand was down and that diligence in improving the net interest margin, lower provisions for loan losses, plus a strong effort to hold the line on operating expenses accounted for the improved earnings. He said he appreciated the hard work of a dedicated staff during these six months and again thanked GLL & Associates, the Company’s mortgage banking subsidiary, for their continued strong earnings momentum. This was a major factor in the Company’s improved earnings.
Assets reached $701,295,212 at the end of the six months, up slightly from the first six months of 2001. Deposits, at $522,040,273, declined 2.8%, reflecting lower interest rates. Loans totaled a record $517,850,773, up 6.8% on June 30. Non-performing assets declined 14.3% at June 30, 2002 compared with June 30, 2001. The loan loss reserve totaled $7,680,704, or 1.51% of net loans outstanding.
Also, during the second quarter, Directors of Bank of Granite Corporation increased the quarterly cash dividend to 11¢ per share compared to the previous quarterly split-adjusted rate of 9.6¢ per share. This represents a 14.6% increase in the quarterly rate. 2002 will mark forty-nine consecutive years of increased cash dividends paid to shareholders.
Bank of Granite Corporation is the parent company of Bank of Granite, which operates fourteen full service banking offices in Caldwell, Catawba, and Burke Counties in North Carolina, and GLL & Associates, Inc., a mortgage banking company headquartered in Winston-Salem. Bank of Granite Corporation has an estimated 5,200 shareholders, with approximately 13.5 million shares of common stock currently outstanding. The stock is traded on the Nasdaq Stock Market® System under the symbol GRAN.
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Please see “Financial Data” tables, which are attached.
For further information, contact Kirby A. Tyndall, Senior Vice President and Chief
Financial Officer at Voice (828) 496-2026, Fax (828) 496-2010 or
Internet email: ktyndall@bankofgranite.com
| Bank of Granite Corporation, PO Box 128, Granite Falls, NC 28630 | www.bankofgranite.com |
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| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||
| Bank of Granite Corporation | June 30, | June 30, | |||||||||||||||||||||||||
| Selected Financial Data | |||||||||||||||||||||||||||
| ($ in thousands except per share data) | 2002 | 2001 | % change | 2002 | 2001 | % change | |||||||||||||||||||||
| Consolidated earnings summary: | |||||||||||||||||||||||||||
| Interest income, taxable equivalent | $ | 11,693 | $ | 13,932 | -16.1 | % | $ | 23,601 | $ | 28,474 | -17.1 | % | |||||||||||||||
| Interest expense | 2,703 | 5,433 | -50.2 | % | 5,601 | 10,977 | -49.0 | % | |||||||||||||||||||
| Net interest income, taxable equivalent | 8,990 | 8,499 | 5.8 | % | 18,000 | 17,497 | 2.9 | % | |||||||||||||||||||
| Taxable equivalent adjustment | 440 | 433 | 1.6 | % | 901 | 878 | 2.6 | % | |||||||||||||||||||
| Net interest income | 8,550 | 8,066 | 6.0 | % | 17,099 | 16,619 | 2.9 | % | |||||||||||||||||||
| Loan loss provision | 1,007 | 2,011 | -49.9 | % | 1,798 | 2,711 | -33.7 | % | |||||||||||||||||||
| Noninterest income | 2,468 | 2,330 | 5.9 | % | 5,118 | 4,777 | 7.1 | % | |||||||||||||||||||
| Noninterest expense | 5,090 | 4,561 | 11.6 | % | 9,911 | 9,063 | 9.4 | % | |||||||||||||||||||
| Income before income taxes | 4,921 | 3,824 | 28.7 | % | 10,508 | 9,622 | 9.2 | % | |||||||||||||||||||
| Income taxes | 1,469 | 1,193 | 23.1 | % | 3,274 | 3,143 | 4.2 | % | |||||||||||||||||||
| Net income | $ | 3,452 | $ | 2,631 | 31.2 | % | $ | 7,234 | $ | 6,479 | 11.7 | % | |||||||||||||||
| Earnings per share — Basic* | $ | 0.25 | $ | 0.19 | 31.6 | % | $ | 0.53 | $ | 0.46 | 15.2 | % | |||||||||||||||
| Earnings per share — Diluted* | 0.25 | 0.19 | 31.6 | % | 0.53 | 0.46 | 15.2 | % | |||||||||||||||||||
| Average shares — Basic* | 13,600 | 13,895 | -2.1 | % | 13,646 | 13,936 | -2.1 | % | |||||||||||||||||||
| Average shares — Diluted* | 13,611 | 13,896 | -2.1 | % | 13,649 | 13,939 | -2.1 | % | |||||||||||||||||||
| Consolidated balance sheet data at June 30: | |||||||||||||||||||||||||||
| Total assets | $ | 701,295 | $ | 700,704 | 0.1 | % | |||||||||||||||||||||
| Total deposits | 522,040 | 537,184 | -2.8 | % | |||||||||||||||||||||||
| Loans (gross) | 517,851 | 485,038 | 6.8 | % | |||||||||||||||||||||||
| Shareholders’ equity | 126,118 | 122,928 | 2.6 | % | |||||||||||||||||||||||
| Consolidated average balance sheet data: | |||||||||||||||||||||||||||
| Total assets | $ | 698,931 | $ | 699,709 | -0.1 | % | $ | 703,350 | $ | 686,044 | 2.5 | % | |||||||||||||||
| Total deposits | 521,259 | 537,287 | -3.0 | % | 516,851 | 530,408 | -2.6 | % | |||||||||||||||||||
| Loans (gross) | 514,203 | 480,700 | 7.0 | % | 512,758 | 471,680 | 8.7 | % | |||||||||||||||||||
| Shareholders’ equity | 125,441 | 121,914 | 2.9 | % | 125,308 | 121,023 | 3.5 | % | |||||||||||||||||||
| Consolidated performance ratios: | |||||||||||||||||||||||||||
| Return on average assets** | 1.98 | % | 1.51 | % | 2.07 | % | 1.90 | % | |||||||||||||||||||
| Return on average equity** | 11.04 | % | 8.66 | % | 11.64 | % | 10.80 | % | |||||||||||||||||||
| Efficiency ratio | 44.42 | % | 42.12 | % | 42.87 | % | 40.69 | % | |||||||||||||||||||
| Consolidated asset quality data and ratios: | |||||||||||||||||||||||||||
| Nonaccruing loans | $ | 2,746 | $ | 2,594 | 5.9 | % | |||||||||||||||||||||
| Accruing loans 90 days past due | 1,252 | 2,400 | -47.8 | % | |||||||||||||||||||||||
| Nonperforming loans | 3,998 | 4,994 | -19.9 | % | |||||||||||||||||||||||
| Foreclosed properties | 527 | 287 | 83.6 | % | |||||||||||||||||||||||
| Nonperforming assets | 4,525 | 5,281 | -14.3 | % | |||||||||||||||||||||||
| Allowance for loan losses | 7,681 | 8,452 | -9.1 | % | |||||||||||||||||||||||
| Loans charged off | 827 | 797 | 3.8 | % | |||||||||||||||||||||||
| Recoveries of loans charged off | 283 | 187 | 51.3 | % | |||||||||||||||||||||||
| Net loan charge-offs (recoveries) | 544 | 610 | -10.8 | % | |||||||||||||||||||||||
| Net charge-offs to average loans** | 0.21 | % | 0.26 | % | |||||||||||||||||||||||
| Nonperforming loans to total assets | 0.57 | % | 0.71 | % | |||||||||||||||||||||||
| Allowance coverage of nonperforming loans | 192.12 | % | 169.24 | % | |||||||||||||||||||||||
| Allowance for loan losses to gross loans | 1.48 | % | 1.74 | % | |||||||||||||||||||||||
| Allowance for loan losses to net loans | 1.51 | % | 1.77 | % | |||||||||||||||||||||||
| Subsidiary earnings summary: | |||||||||||||||||||||||||||
| Bank of Net interest income | $ | 7,835 | $ | 7,369 | 6.3 | % | $ | 15,557 | $ | 15,400 | 1.0 | % | |||||||||||||||
| Granite Loan loss provision | 977 | 1,981 | -50.7 | % | 1,738 | 2,651 | -34.4 | % | |||||||||||||||||||
| Noninterest income | 1,700 | 1,655 | 2.7 | % | 3,651 | 3,432 | 6.4 | % | |||||||||||||||||||
| Noninterest expense | 3,871 | 3,377 | 14.6 | % | 7,519 | 6,922 | 8.6 | % | |||||||||||||||||||
| Income taxes | 1,341 | 1,066 | 25.8 | % | 2,977 | 2,919 | 2.0 | % | |||||||||||||||||||
| Net income | 3,346 | 2,600 | 28.7 | % | 6,974 | 6,340 | 10.0 | % | |||||||||||||||||||
| GLL & Net interest income | $ | 709 | $ | 741 | -4.3 | % | $ | 1,499 | $ | 1,269 | 18.1 | % | |||||||||||||||
| Associates Loan loss provision | 30 | 30 | 0.0 | % | 60 | 60 | 0.0 | % | |||||||||||||||||||
| (mortgage Noninterest income | 765 | 711 | 7.6 | % | 1,561 | 1,380 | 13.1 | % | |||||||||||||||||||
| bank) Noninterest expense | 1,153 | 1,137 | 1.4 | % | 2,318 | 2,088 | 11.0 | % | |||||||||||||||||||
| Income taxes | 128 | 126 | 1.6 | % | 297 | 224 | 32.6 | % | |||||||||||||||||||
| Net income | 193 | 189 | 2.1 | % | 445 | 337 | 32.0 | % | |||||||||||||||||||
* Restated for 5-for-4 stock split paid May 31, 2002. ** Annualized based on number of days in the period. More
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| Quarters Ended | |||||||||||||||||||||||
| Bank of Granite Corporation | |||||||||||||||||||||||
| Supplemental Quarterly Financial Data | Jun 30, | Mar 31, | Dec 31, | Sep 30, | Jun 30, | ||||||||||||||||||
| ($ in thousands except per share data) | 2002 | 2002 | 2001 | 2001 | 2001 | ||||||||||||||||||
| Consolidated earnings summary: | |||||||||||||||||||||||
| Interest income, taxable equivalent | $ | 11,693 | $ | 11,909 | $ | 12,442 | $ | 13,170 | $ | 13,932 | |||||||||||||
| Interest expense | 2,703 | 2,898 | 3,687 | 4,779 | 5,433 | ||||||||||||||||||
| Net interest income, taxable equivalent | 8,990 | 9,011 | 8,755 | 8,391 | 8,499 | ||||||||||||||||||
| Taxable equivalent adjustment | 440 | 463 | 468 | 455 | 433 | ||||||||||||||||||
| Net interest income | 8,550 | 8,548 | 8,287 | 7,936 | 8,066 | ||||||||||||||||||
| Loan loss provision | 1,007 | 791 | 708 | 798 | 2,011 | ||||||||||||||||||
| Noninterest income | 2,468 | 2,650 | 2,874 | 2,490 | 2,330 | ||||||||||||||||||
| Noninterest expense | 5,090 | 4,820 | 4,639 | 4,642 | 4,561 | ||||||||||||||||||
| Income before income taxes | 4,921 | 5,587 | 5,814 | 4,986 | 3,824 | ||||||||||||||||||
| Income taxes | 1,469 | 1,805 | 1,896 | 1,574 | 1,193 | ||||||||||||||||||
| Net income | $ | 3,452 | $ | 3,782 | $ | 3,918 | $ | 3,412 | $ | 2,631 | |||||||||||||
| Earnings per share — Basic* | $ | 0.25 | $ | 0.28 | $ | 0.28 | $ | 0.25 | $ | 0.19 | |||||||||||||
| Earnings per share — Diluted* | 0.25 | 0.28 | 0.28 | 0.25 | 0.19 | ||||||||||||||||||
| Average shares — Basic* | 13,600 | 13,692 | 13,797 | 13,873 | 13,895 | ||||||||||||||||||
| Average shares — Diluted* | 13,611 | 13,693 | 13,799 | 13,875 | 13,896 | ||||||||||||||||||
| Consolidated ending balance sheet data: | |||||||||||||||||||||||
| Total assets | $ | 701,295 | $ | 706,673 | $ | 715,390 | $ | 717,129 | $ | 700,704 | |||||||||||||
| Total deposits | 522,040 | 519,997 | 522,783 | 532,624 | 537,184 | ||||||||||||||||||
| Loans (gross) | 517,851 | 514,436 | 510,411 | 483,416 | 485,038 | ||||||||||||||||||
| Shareholders’ equity | 126,118 | 125,157 | 124,781 | 124,331 | 122,928 | ||||||||||||||||||
| Consolidated average balance sheet data: | |||||||||||||||||||||||
| Total assets | $ | 698,931 | $ | 707,769 | $ | 699,433 | $ | 693,358 | $ | 699,709 | |||||||||||||
| Total deposits | 521,259 | 512,443 | 524,830 | 530,467 | 537,287 | ||||||||||||||||||
| Loans (gross) | 514,203 | 511,313 | 493,563 | 482,005 | 480,700 | ||||||||||||||||||
| Shareholders’ equity | 125,441 | 125,175 | 124,317 | 123,014 | 121,914 | ||||||||||||||||||
| Consolidated performance ratios: | |||||||||||||||||||||||
| Return on average assets** | 1.98 | % | 2.17 | % | 2.22 | % | 1.95 | % | 1.51 | % | |||||||||||||
| Return on average equity** | 11.04 | % | 12.25 | % | 12.50 | % | 11.00 | % | 8.66 | % | |||||||||||||
| Efficiency ratio | 44.42 | % | 41.33 | % | 39.89 | % | 42.66 | % | 42.12 | % | |||||||||||||
| Consolidated asset quality data and ratios: | |||||||||||||||||||||||
| Nonaccruing loans | $ | 2,746 | $ | 3,253 | $ | 2,944 | $ | 3,647 | $ | 2,594 | |||||||||||||
| Accruing loans 90 days past due | 1,252 | 890 | 1,769 | 3,459 | 2,400 | ||||||||||||||||||
| Nonperforming loans | 3,998 | 4,143 | 4,713 | 7,106 | 4,994 | ||||||||||||||||||
| Foreclosed properties | 527 | 312 | 323 | 304 | 287 | ||||||||||||||||||
| Nonperforming assets | 4,525 | 4,455 | 5,036 | 7,410 | 5,281 | ||||||||||||||||||
| Allowance for loan losses | 7,144 | 7,144 | 6,426 | 6,630 | 8,452 | ||||||||||||||||||
| Loans charged off | 526 | 301 | 993 | 2,711 | 567 | ||||||||||||||||||
| Recoveries of loans charged off | 55 | 228 | 82 | 90 | 89 | ||||||||||||||||||
| Net loan charge-offs (recoveries) | 471 | 73 | 911 | 2,621 | 478 | ||||||||||||||||||
| Annualized net charge-offs to average loans** | 0.37 | % | 0.06 | % | 0.73 | % | 2.16 | % | 0.40 | % | |||||||||||||
| Nonperforming loans to total assets | 0.57 | % | 0.59 | % | 0.66 | % | 0.99 | % | 0.71 | % | |||||||||||||
| Allowance coverage of nonperforming loans | 178.69 | % | 172.44 | % | 136.35 | % | 93.30 | % | 169.24 | % | |||||||||||||
| Allowance for loan losses to gross loans | 1.38 | % | 1.39 | % | 1.26 | % | 1.37 | % | 1.74 | % | |||||||||||||
| Allowance for loan losses to net loans | 1.40 | % | 1.41 | % | 1.28 | % | 1.39 | % | 1.77 | % | |||||||||||||
| Subsidiary earnings summary: | |||||||||||||||||||||||
| Bank of Net interest income | $ | 7,835 | $ | 7,722 | $ | 7,477 | $ | 7,235 | $ | 7,369 | |||||||||||||
| Granite Loan loss provision | 977 | 761 | 678 | 768 | 1,981 | ||||||||||||||||||
| Noninterest income | 1,700 | 1,951 | 1,938 | 1,684 | 1,655 | ||||||||||||||||||
| Noninterest expense | 3,871 | 3,647 | 3,380 | 3,470 | 3,377 | ||||||||||||||||||
| Income taxes | 1,341 | 1,636 | 1,691 | 1,416 | 1,066 | ||||||||||||||||||
| Net income | 3,346 | 3,629 | 3,666 | 3,265 | 2,600 | ||||||||||||||||||
| GLL & Net interest income | $ | 709 | $ | 790 | $ | 826 | $ | 749 | $ | 741 | |||||||||||||
| Associates Loan loss provision | 30 | 30 | 30 | 30 | 30 | ||||||||||||||||||
| (mortgage Noninterest income | 765 | 796 | 936 | 806 | 711 | ||||||||||||||||||
| bank) Noninterest expense | 1,153 | 1,166 | 1,249 | 1,160 | 1,137 | ||||||||||||||||||
| Income taxes | 128 | 168 | 205 | 158 | 126 | ||||||||||||||||||
| Net income | 193 | 252 | 308 | 237 | 189 | ||||||||||||||||||
* Restated for 5-for-4 stock split paid May 31, 2002. ** Annualized based on number of days in the period.
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