Exhibit 99 (a)
Bank of Granite Corporation
| For Release: | October 15, 2002 |
BANK OF GRANITE REPORTS IMPROVED EARNINGS
FOR THE THIRD QUARTER AND YEAR-TO-DATE PERIODS
Bank of Granite Corporation (Nasdaq: GRAN) is pleased to report improved earnings for the third quarter and nine month periods, both ending September 30, 2002.
For the third quarter, net income was $3,682,584 compared with $3,411,815 earned in the third quarter of 2001–an increase of 7.9% due primarily to higher net interest income. Quarterly per share income was 27¢ vs. 25¢ for 2001’s third quarter–an increase of 8%. Per share earnings for 2001 have been adjusted to reflect the 5-for-4 stock split paid in May 2002.
Higher net interest income, increased mortgage originations and lower loan loss provisions helped produce earnings of $10,916,458 for the nine-month period ending September 30, 2002 compared with $9,890,428 in 2001–an increase of 10.4%. Per share earnings for the nine-month period were $0.80 vs. $0.71, adjusted for the stock split, for the same period in 2001–a 12.7% increase.
John A. Forlines, Jr., Chairman and CEO of Bank of Granite Corporation said the earnings were “slightly better than Company expectations and were achieved despite continued high unemployment and a very slow economy in the Bank’s market area.” According to Mr. Forlines, “August unemployment in the Bank’s metropolitan statistical area was reported at 7.6% and, although lower than the mid-summer levels, remained high relative to the area’s history.” Mr. Forlines said he was optimistic regarding the Bank’s future earnings and the economy over the long term, but that it would likely take several quarters to get through “a very tough period.”
Assets at the end of the third quarter reached a record $732,091,599, an increase of 2.1% compared with 2001. Loans grew to a record $542,345,541, an increase of 12.2% above the comparable period in 2001. Deposits totaled $537,756,491, a 1% increase over 2001.
As usual, Mr. Forlines thanked members of the Bank of Granite family for their hard work and dedication, which produced these earnings. He commended the staff of GLL & Associates, the Company’s mortgage bank, for the outstanding year they are having. Their earnings are up over 23% year-to-date.
Again, the Company’s critical key ratios continued to be outstanding. Earnings on average assets for the nine-month period were 2.08%, and the Company earned 11.62% on average equity. The capital to asset ratio was 17.41%, indicating that Bank of Granite remains one of the soundest, best-capitalized banks in the nation.
Bank of Granite Corporation is the parent company of Bank of Granite and GLL & Associates, Inc. The bank operates fourteen full-service banking offices in Caldwell, Catawba, and Burke Counties—the “Unifour” area of North Carolina. GLL, headquartered in Winston-Salem, originates home mortgages in the Catawba Valley and the Central and Southern Piedmont regions of North Carolina. Bank of Granite Corporation has an estimated 5,000 shareholders with 13,457,199 shares of common stock outstanding as of September 30, 2002. The stock is traded on the NASDAQ Stock Market® under the symbol of GRAN.
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Please see “Financial Data” tables, which are attached.
For further information, contact —
Kirby A. Tyndall, Chief Financial Officer
Internet: ktyndall@bankofgranite.com, Voice (828) 496-2026 or Fax (828) 496-2010
| Bank of Granite Corporation, PO Box 128, Granite Falls, NC 28630 | www.bankofgranite.com |
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| Bank of Granite Corporation | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
| Selected Financial Data | September 30, | September 30, | ||||||||||||||||||||||||
| ($ in thousands except per share data) | 2002 | 2001 | % change | 2002 | 2001 | % change | ||||||||||||||||||||
| Consolidated earnings summary: | ||||||||||||||||||||||||||
| Interest income, taxable equivalent | $ | 11,721 | $ | 13,170 | -11.0 | % | $ | 35,323 | $ | 41,644 | -15.2 | % | ||||||||||||||
| Interest expense | 2,668 | 4,779 | -44.2 | % | 8,269 | 15,756 | -47.5 | % | ||||||||||||||||||
| Net interest income, taxable equivalent | 9,053 | 8,391 | 7.9 | % | 27,054 | 25,888 | 4.5 | % | ||||||||||||||||||
| Taxable equivalent adjustment | 418 | 455 | -8.1 | % | 1,321 | 1,334 | -1.0 | % | ||||||||||||||||||
| Net interest income | 8,635 | 7,936 | 8.8 | % | 25,733 | 24,554 | 4.8 | % | ||||||||||||||||||
| Loan loss provision | 897 | 798 | 12.4 | % | 2,695 | 3,509 | -23.2 | % | ||||||||||||||||||
| Noninterest income | 2,925 | 2,490 | 17.5 | % | 8,043 | 7,266 | 10.7 | % | ||||||||||||||||||
| Noninterest expense | 5,017 | 4,642 | 8.1 | % | 14,928 | 13,704 | 8.9 | % | ||||||||||||||||||
| Income before income taxes | 5,646 | 4,986 | 13.2 | % | 16,153 | 14,607 | 10.6 | % | ||||||||||||||||||
| Income taxes | 1,963 | 1,574 | 24.7 | % | 5,237 | 4,717 | 11.0 | % | ||||||||||||||||||
| Net income | $ | 3,683 | $ | 3,412 | 7.9 | % | $ | 10,916 | $ | 9,890 | 10.4 | % | ||||||||||||||
| Earnings per share — Basic* | $ | 0.27 | $ | 0.25 | 8.0 | % | $ | 0.80 | $ | 0.71 | 12.7 | % | ||||||||||||||
| Earnings per share — Diluted* | 0.27 | 0.25 | 8.0 | % | 0.80 | 0.71 | 12.7 | % | ||||||||||||||||||
| Average shares — Basic* | 13,494 | 13,873 | -2.7 | % | 13,595 | 13,923 | -2.4 | % | ||||||||||||||||||
| Average shares — Diluted* | 13,502 | 13,875 | -2.7 | % | 13,599 | 13,926 | -2.3 | % | ||||||||||||||||||
| Consolidated balance sheet data at September 30: | ||||||||||||||||||||||||||
| Total assets | $ | 732,092 | $ | 717,129 | 2.1 | % | ||||||||||||||||||||
| Total deposits | 537,756 | 532,624 | 1.0 | % | ||||||||||||||||||||||
| Loans (gross) | 542,346 | 483,416 | 12.2 | % | ||||||||||||||||||||||
| Shareholders’ equity | 127,490 | 124,331 | 2.5 | % | ||||||||||||||||||||||
| Consolidated average balance sheet data: | ||||||||||||||||||||||||||
| Total assets | $ | 702,543 | $ | 693,358 | 1.3 | % | $ | 703,081 | $ | 688,482 | 2.1 | % | ||||||||||||||
| Total deposits | 524,366 | 530,467 | -1.2 | % | 519,356 | 530,428 | -2.1 | % | ||||||||||||||||||
| Loans (gross) | 529,895 | 482,005 | 9.9 | % | 518,470 | 475,121 | 9.1 | % | ||||||||||||||||||
| Shareholders’ equity | 126,264 | 123,014 | 2.6 | % | 125,626 | 121,687 | 3.2 | % | ||||||||||||||||||
| Consolidated performance ratios: | ||||||||||||||||||||||||||
| Return on average assets** | 2.08 | % | 1.95 | % | 2.08 | % | 1.92 | % | ||||||||||||||||||
| Return on average equity** | 11.57 | % | 11.00 | % | 11.62 | % | 10.87 | % | ||||||||||||||||||
| Efficiency ratio | 41.89 | % | 42.66 | % | 42.53 | % | 41.33 | % | ||||||||||||||||||
| Consolidated asset quality data and ratios: | ||||||||||||||||||||||||||
| Nonaccruing loans | $ | 2,992 | $ | 3,647 | -18.0 | % | ||||||||||||||||||||
| Accruing loans 90 days past due | 1,558 | 3,459 | -55.0 | % | ||||||||||||||||||||||
| Nonperforming loans | 4,550 | 7,106 | -36.0 | % | ||||||||||||||||||||||
| Foreclosed properties | 1,197 | 304 | 293.8 | % | ||||||||||||||||||||||
| Nonperforming assets | 5,747 | 7,410 | -22.4 | % | ||||||||||||||||||||||
| Allowance for loan losses | 8,223 | 6,630 | 24.0 | % | ||||||||||||||||||||||
| Loans charged off | 1,247 | 3,508 | -64.5 | % | ||||||||||||||||||||||
| Recoveries of loans charged off | 348 | 277 | 25.6 | % | ||||||||||||||||||||||
| Net loan charge-offs (recoveries) | 899 | 3,231 | -72.2 | % | ||||||||||||||||||||||
| Net charge-offs to average loans** | 0.23 | % | 0.91 | % | ||||||||||||||||||||||
| Nonperforming loans to total assets | 0.62 | % | 0.99 | % | ||||||||||||||||||||||
| Allowance coverage of nonperforming loans | 180.73 | % | 93.30 | % | ||||||||||||||||||||||
| Allowance for loan losses to gross loans | 1.52 | % | 1.37 | % | ||||||||||||||||||||||
| Allowance for loan losses to net loans | 1.54 | % | 1.39 | % | ||||||||||||||||||||||
| Subsidiary earnings summary: | ||||||||||||||||||||||||||
| Bank of Granite | ||||||||||||||||||||||||||
| Net interest income | $ | 7,915 | $ | 7,235 | 9.4 | % | $ | 23,472 | $ | 22,635 | 3.7 | % | ||||||||||||||
| Loan loss provision | 887 | 768 | 15.5 | % | 2,625 | 3,419 | -23.2 | % | ||||||||||||||||||
| Noninterest income | 1,962 | 1,684 | 16.5 | % | 5,613 | 5,116 | 9.7 | % | ||||||||||||||||||
| Noninterest expense | 3,730 | 3,470 | 7.5 | % | 11,249 | 10,393 | 8.2 | % | ||||||||||||||||||
| Income taxes | 1,787 | 1,416 | 26.2 | % | 4,764 | 4,334 | 9.9 | % | ||||||||||||||||||
| Net income | 3,473 | 3,265 | 6.4 | % | 10,447 | 9,605 | 8.8 | % | ||||||||||||||||||
| GLL & Associates (mortgage bank) | ||||||||||||||||||||||||||
| Net interest income | $ | 720 | $ | 749 | -3.9 | % | $ | 2,219 | $ | 2,018 | 10.0 | % | ||||||||||||||
| Loan loss provision | 10 | 30 | -66.7 | % | 70 | 90 | -22.2 | % | ||||||||||||||||||
| Noninterest income | 964 | 806 | 19.6 | % | 2,525 | 2,186 | 15.5 | % | ||||||||||||||||||
| Noninterest expense | 1,245 | 1,160 | 7.3 | % | 3,564 | 3,247 | 9.8 | % | ||||||||||||||||||
| Income taxes | 176 | 158 | 11.4 | % | 472 | 383 | 23.2 | % | ||||||||||||||||||
| Net income | 263 | 237 | 11.0 | % | 708 | 574 | 23.3 | % | ||||||||||||||||||
| * 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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| Bank of Granite Corporation | Quarters Ended | |||||||||||||||||||||
| Supplemental Quarterly Financial Data | Sep 30, | Jun 30, | Mar 31, | Dec 31, | Sep 30, | |||||||||||||||||
| ($ in thousands except per share data) | 2002 | 2002 | 2002 | 2001 | 2001 | |||||||||||||||||
| Consolidated earnings summary: | ||||||||||||||||||||||
| Interest income, taxable equivalent | $ | 11,721 | $ | 11,693 | $ | 11,909 | $ | 11,148 | $ | 13,170 | ||||||||||||
| Interest expense | 2,668 | 2,703 | 2,898 | 3,687 | 4,779 | |||||||||||||||||
| Net interest income, taxable equivalent | 9,053 | 8,990 | 9,011 | 7,461 | 8,391 | |||||||||||||||||
| Taxable equivalent adjustment | 418 | 440 | 463 | 468 | 455 | |||||||||||||||||
| Net interest income | 8,635 | 8,550 | 8,548 | 6,993 | 7,936 | |||||||||||||||||
| Loan loss provision | 897 | 1,007 | 791 | 658 | 798 | |||||||||||||||||
| Noninterest income | 2,925 | 2,468 | 2,650 | 1,812 | 2,490 | |||||||||||||||||
| Noninterest expense | 5,017 | 5,090 | 4,820 | 2,752 | 4,642 | |||||||||||||||||
| Income before income taxes | 5,646 | 4,921 | 5,587 | 5,395 | 4,986 | |||||||||||||||||
| Income taxes | 1,963 | 1,469 | 1,805 | 1,477 | 1,574 | |||||||||||||||||
| Net income | $ | 3,683 | $ | 3,452 | $ | 3,782 | $ | 3,918 | $ | 3,412 | ||||||||||||
| Earnings per share — Basic* | $ | 0.27 | $ | 0.25 | $ | 0.28 | $ | 0.28 | $ | 0.25 | ||||||||||||
| Earnings per share — Diluted* | 0.27 | 0.25 | 0.28 | 0.28 | 0.25 | |||||||||||||||||
| Average shares — Basic* | 13,494 | 13,600 | 13,692 | 13,797 | 13,873 | |||||||||||||||||
| Average shares — Diluted* | 13,502 | 13,611 | 13,693 | 13,799 | 13,875 | |||||||||||||||||
| Consolidated ending balance sheet data: | ||||||||||||||||||||||
| Total assets | $ | 732,092 | $ | 701,295 | $ | 706,673 | $ | 715,390 | $ | 717,129 | ||||||||||||
| Total deposits | 537,756 | 522,040 | 519,997 | 522,783 | 532,624 | |||||||||||||||||
| Loans (gross) | 542,346 | 517,851 | 514,436 | 510,411 | 483,416 | |||||||||||||||||
| Shareholders’ equity | 127,490 | 126,118 | 125,157 | 124,781 | 124,331 | |||||||||||||||||
| Consolidated average balance sheet data: | ||||||||||||||||||||||
| Total assets | $ | 702,543 | $ | 698,931 | $ | 707,769 | $ | 658,435 | $ | 693,358 | ||||||||||||
| Total deposits | 524,366 | 521,259 | 512,443 | 524,854 | 530,467 | |||||||||||||||||
| Loans (gross) | 529,895 | 514,203 | 511,313 | 449,473 | 482,005 | |||||||||||||||||
| Shareholders’ equity | 126,264 | 125,441 | 125,175 | 124,317 | 123,014 | |||||||||||||||||
| Consolidated performance ratios: | ||||||||||||||||||||||
| Return on average assets** | 2.08 | % | 1.98 | % | 2.17 | % | 2.36 | % | 1.95 | % | ||||||||||||
| Return on average equity** | 11.57 | % | 11.04 | % | 12.25 | % | 12.50 | % | 11.00 | % | ||||||||||||
| Efficiency ratio | 41.89 | % | 44.42 | % | 41.33 | % | 29.68 | % | 42.66 | % | ||||||||||||
| Consolidated asset quality data and ratios: | ||||||||||||||||||||||
| Nonaccruing loans | $ | 2,992 | $ | 2,746 | $ | 3,253 | $ | 2,944 | $ | 3,647 | ||||||||||||
| Accruing loans 90 days past due | 1,558 | 1,252 | 890 | 1,769 | 3,459 | |||||||||||||||||
| Nonperforming loans | 4,550 | 3,998 | 4,143 | 4,713 | 7,106 | |||||||||||||||||
| Foreclosed properties | 1,197 | 527 | 312 | 323 | 304 | |||||||||||||||||
| Nonperforming assets | 5,747 | 4,525 | 4,455 | 5,036 | 7,410 | |||||||||||||||||
| Allowance for loan losses | 8,223 | 7,681 | 7,144 | 6,426 | 6,630 | |||||||||||||||||
| Loans charged off | 420 | 526 | 301 | 993 | 2,711 | |||||||||||||||||
| Recoveries of loans charged off | 65 | 55 | 228 | 82 | 90 | |||||||||||||||||
| Net loan charge-offs (recoveries) | 355 | 471 | 73 | 911 | 2,621 | |||||||||||||||||
| Annualized net charge-offs to average loans** | 0.27 | % | 0.37 | % | 0.06 | % | 0.80 | % | 2.16 | % | ||||||||||||
| Nonperforming loans to total assets | 0.62 | % | 0.57 | % | 0.59 | % | 0.66 | % | 0.99 | % | ||||||||||||
| Allowance coverage of nonperforming loans | 180.73 | % | 192.12 | % | 172.44 | % | 136.35 | % | 93.30 | % | ||||||||||||
| Allowance for loan losses to gross loans | 1.52 | % | 1.48 | % | 1.39 | % | 1.26 | % | 1.37 | % | ||||||||||||
| Allowance for loan losses to net loans | 1.54 | % | 1.51 | % | 1.41 | % | 1.28 | % | 1.39 | % | ||||||||||||
| Subsidiary earnings summary: | ||||||||||||||||||||||
| Bank of Granite | ||||||||||||||||||||||
| Net interest income | $ | 7,915 | $ | 7,835 | $ | 7,722 | $ | 7,477 | $ | 7,235 | ||||||||||||
| Loan loss provision | 887 | 977 | 761 | 678 | 768 | |||||||||||||||||
| Noninterest income | 1,962 | 1,700 | 1,951 | 1,938 | 1,684 | |||||||||||||||||
| Noninterest expense | 3,730 | 3,871 | 3,647 | 3,380 | 3,470 | |||||||||||||||||
| Income taxes | 1,787 | 1,341 | 1,636 | 1,691 | 1,416 | |||||||||||||||||
| Net income | 3,473 | 3,346 | 3,629 | 3,666 | 3,265 | |||||||||||||||||
| GLL & Associates (mortgage bank) | ||||||||||||||||||||||
| Net interest income | $ | 720 | $ | 709 | $ | 790 | $ | (467 | ) | $ | 749 | |||||||||||
| Loan loss provision | 10 | 30 | 30 | (20 | ) | 30 | ||||||||||||||||
| Noninterest income | 964 | 765 | 796 | (125 | ) | 806 | ||||||||||||||||
| Noninterest expense | 1,245 | 1,153 | 1,166 | (686 | ) | 1,160 | ||||||||||||||||
| Income taxes | 176 | 128 | 168 | (214 | ) | 158 | ||||||||||||||||
| Net income | 263 | 193 | 252 | 308 | 237 | |||||||||||||||||
| * Restated for 5-for-4 stock split paid May 31, 2002. | ** Annualized based on number of days in the period. |
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