Exhibit 99.1
FOR IMMEDIATE RELEASE
July 26, 2007
| | | | |
| | Contacts: | | Melanie J. Dressel, President and |
| | | | Chief Executive Officer |
| | | | (253) 305-1911 |
| | |
| | | | Gary R. Schminkey, Executive Vice President |
| | | | and Chief Financial Officer |
| | | | (253) 305-1966 |
COLUMBIA BANKING SYSTEM ANNOUNCES
STRONG SECOND QUARTER 2007 EARNINGS
2ND QUARTER HIGHLIGHTS
• | | Net income of $8.5 million, up 18% from 2nd quarter 2006. |
| • | | Earnings per diluted share of $0.53, up 18% from $0.45 the prior year. |
| • | | Total loans were $1.9 billion, an increase of $151 million, or 9%, from December 31, 2006 |
| • | | Total deposits were $2.1 billion, up 5% from December 31, 2006. |
| • | | Bellevue South branch opened June, 2007. |
| • | | Acquisitions of Mountain Bank Holding Company and Town Center Bancorp completed July 23, 2007. Columbia branch system expands to 53 locations in 9 counties in western Washington and Oregon |
TACOMA, Washington — Columbia Banking System, Inc. (NASDAQ: COLB) today announced earnings for the second quarter 2007 of $8.5 million, an increase of 18% from $7.2 million for the second quarter of 2006. Diluted earnings per share were $0.53, an increase of 18% from $0.45 per share one year ago. Return on average assets and return on average equity for the second quarter 2007 were 1.29% and 13.04%, respectively, compared to 1.17% and 12.48%, respectively, for the same period in 2006. Return on average tangible equity for the second quarter 2007 was 15.04% compared to 14.77% for second quarter 2006. Revenue (net interest income plus noninterest income) was $32.4 million for the second quarter of 2007, up 6% from $30.6 million one year ago.
Melanie Dressel, President & Chief Executive Officer said, “The increase in our earnings was a result of staying focused on growth in loans, deposits and non-interest income. The investments we made in banking teams during the first quarter of this year have already begun to produce results. In addition to attracting new banking relationships, we are also expanding the depth of the relationships we have with existing clients.”
Ms. Dressel continued, “In spite of an increasingly competitive banking environment in all the markets we serve, we achieved 14% loan growth since June 30, 2006, and 9% growth since year-end 2006. Commercial business loans are up 10% since December 31, 2006, and represent about 37% of our total loans. We continue to maintain our discipline in both credit administration and in the diversification of our loan portfolio.”
“Core deposits, which consist of demand, savings, and money market accounts, represented 70% of total deposits,” Ms. Dressel noted. “Competition for deposits has also been aggressive; however, we continue to see core deposit growth. This has helped us maintain a relatively stable net interest margin, although more of these deposits are in the interest-bearing checking and money market categories.”
Net income for the six months ended June 30, 2007 was $15.8 million, an increase of 3% from $15.4 million for the first six months of 2006. On a diluted per share basis, net income was $0.97, compared with $0.96 for the same period last year. Return on average assets and return on average equity for the first six months of 2007 were 1.22% and 12.29% respectively, compared to 1.28% and 13.42%, respectively, for the same period in 2006. Return on average tangible equity for the first six months of 2007 was 14.23%, compared to 15.87% for the same period in 2006.
At June 30, 2007, Columbia’s total assets were $2.66 billion, an increase of 4% from $2.55 billion at December 31, 2006. Total loans were $1.86 billion at June 30, 2007, up $151 million, or 9%, from $1.71 billion at year-end 2006. Total deposits were $2.12 billion at June 30, 2007, up 5% from $2.02 billion at December 31, 2006.
Second Quarter 2007 Operating Results
Net Interest Income
Net interest income for the second quarter of 2007 was $25.7 million, an increase of $1.4 million, or 6%, compared to $24.3 million for the second quarter 2006. The increase is primarily due to higher loan volumes. Columbia’s net interest margin was lower compared to the same period in
2006 as a result of higher deposit costs and borrowings to fund the growth in loans. The net interest margin was 4.36% for the second quarter of 2007, compared to 4.47% for the second quarter of 2006. On a linked quarterly basis, the net interest margin was 4.37% for the first quarter of 2007, and 4.43% for the fourth quarter of 2006.
Average interest-earning assets increased 8% to $2.46 billion during the second quarter of 2007, compared with $2.27 billion during the second quarter of 2006. The yield on average interest-earning assets increased 44 basis points to 7.23% during the second quarter of 2007, from 6.79% for the same period in 2006. Average interest-bearing liabilities increased to $1.94 billion from $1.79 billion last year. The cost of average interest-bearing liabilities increased 69 basis points to 3.62% in the second quarter of 2007, compared to 2.93% in the second quarter of 2006.
For the six months ended June 30, 2007, net interest income increased 4% to $50.4 million from $48.6 million for the same period in 2006. This increase for the first half of 2007 was primarily driven by loan growth, offset by an increase in interest expense on interest-bearing deposits.
During the first six months of 2007, Columbia’s net interest margin decreased to 4.37% from 4.56% for the same period of 2006. Average interest-earning assets grew to $2.43 billion during the first six months of 2007 compared with $2.23 billion for the same period of 2006. The yield on average interest-earning assets increased 48 basis points to 7.19% during the first six months of 2007, from 6.71% in 2006. In comparison, average interest-bearing liabilities grew to $1.92 billion compared with $1.74 billion for the first six months of 2006. The cost of average interest-bearing liabilities increased 82 basis points to 3.58% during the first six months of 2007, compared to 2.76% for the same period in 2006.
Noninterest income
Total noninterest income for the second quarter 2007 was $6.7 million, an increase of 8% from $6.3 million a year ago. The increase in noninterest income during the second quarter of 2007 as compared to second quarter 2006 was primarily due to service charges and other fees, which increased $386,000, or 13%, partially offset by a decline in merchant services fees. Total noninterest income for the first six months of 2007 was $12.9 million, an increase of $678,000, or 6%, from $12.2 million for the same period of 2006.
Noninterest expense
Noninterest expense for the second quarter of 2007 was $20.3 million, a decrease of 4% from $21.1 million for the same period in 2006. This decrease was primarily due to the mark to market charges associated with interest rate floor instruments recognized through earnings in the second quarter of 2006. The valuation adjustment for the interest rate floors resulted in a pre-tax, non-cash expense for the second quarter 2006 of $1.8 million. Our second quarter 2007 noninterest expense increased $905,000, or 5%, from the second quarter of 2006 after removing the nonrecurring adjustment related to our interest rate floors. Increases in expenses associated with employee compensation, benefits, and occupancy during the second quarter of 2007 were partially tempered by a reduction in advertising and promotion expense. Virtually all of the 2007 versus 2006 second quarter increase of $1.4 million in compensation and benefit expense was associated with the expansion of our retail branch and commercial lending units. The additional compensation expense incurred in the expansion of Columbia’s productive capacity contributed to an 8%, or $1.9 million, increase in total production revenue (defined as loan interest income plus noninterest income less interest expense).
Total production revenue (as defined above) for the first six months of 2007 increased $1.8 million over the same period in 2006. Compensation and benefit expense increased $3.1 million and occupancy expense was up $449,000 when comparing the first six months of 2007 to 2006. A majority of our additional bankers were added late in the fourth quarter of 2006 and early in the first quarter of 2007. These teams spent much of the first quarter building their production pipelines for which we began to realize the full revenue impact during the second quarter.
Also impacting the second quarter 2007 was occupancy expense, which increased $260,000 due to costs incurred for the ongoing expansion of our branch network in King and Thurston counties coupled with a general increase in prevailing rents of existing facilities and costs associated with the reconfiguration for more efficient use of existing space in our operations center located in Lakewood, Washington.
Nonperforming Assets and Loan Loss Provision
The company made a provision for loan losses of $329,000 for the quarter ending June 30, 2007 compared to $638,000 for the first quarter of 2007 and $250,000 for the second quarter of 2006. The decrease in the provision from the first quarter of 2007 was primarily attributable to a slower rate of growth in the loan portfolio on a linked quarter basis. The allowance for loan and lease losses as a percentage of loans (excluding loans held for sale at each date) as of June 30, 2007 was essentially unchanged at 1.15% compared to 1.14% as of March 31, 2007.
Non performing assets to period end assets as of June 30, 2007 increased 10 basis points over the first quarter of 2007 and are attributable to a single lending relationship. The bank is pursuing its remedies in accordance with the loan agreement which evidences this transaction. At this time the bank believes the loans to be adequately secured by the underlying real estate and no loss is expected.
Expansion Activities
In June, 2007, Columbia Bank opened the second full-service branch office in the rapidly growing Bellevue market. The previously announced Lacey Branch, which has been delayed by permitting issues, is currently under construction and is slated to open in the fourth quarter, 2007.
On March 28, 2007, Columbia announced the signing of definitive merger agreements with Mountain Bank Holding Company, and Town Center Bancorp. Both transactions closed on July 23, 2007, following shareholder and regulatory approvals. This brings Columbia’s number of branches to 53, located in nine counties in Washington and Oregon.
Ms. Dressel commented, “The addition of these two fine organizations to the Columbia family expands our footprint into adjacent markets, and moves us significantly closer to our often stated goal of becoming a Pacific Northwest regional community bank. We will continue to look for opportunities to grow strategically through de novo expansion and accretive partnerships.”
About Columbia
Columbia Banking System, Inc. is a 53-branch Tacoma-based bank holding company whose wholly owned banking subsidiaries are Columbia Bank and Bank of Astoria. Columbia Bank is a Washington state-chartered full-service commercial bank; with completion of the mergers, Columbia Bank has 48 banking offices in Pierce, King, Cowlitz, Kitsap and Thurston counties in Washington State, and Clackamas and Multnomah counties in Oregon. Included in Columbia Bank are former branches of Mt. Rainier National Bank, doing business as Mt. Rainier Bank, with 7 branches in King and Pierce counties. Bank of Astoria, a federally insured commercial bank headquartered in Astoria, Oregon, operates four branches in Clatsop County: Astoria, Warrenton, Seaside and Cannon Beach; and one branch in Manzanita in Tillamook County. More information about Columbia can be found on its website atwww.columbiabank.com.
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Note Regarding Forward Looking Statements
This news release includes forward looking statements, which management believes are a benefit to shareholders. These forward looking statements describe Columbia’s management’s expectations regarding future events and developments such as future operating results, growth in loans and deposits, continued success of Columbia’s style of banking and the strength of the local economy. The words “will,” “believe,” “expect,” “should,” and “anticipate” and words of similar construction are intended in part to help identify forward looking statements. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely. In addition to discussions about risks and uncertainties set forth from time to time in Columbia’s filings with the SEC, factors that may cause actual results to differ materially from those contemplated by such forward looking statements include, among others, the following possibilities: (1) local, national and international economic conditions are less favorable than expected or have a more direct and pronounced effect on Columbia than expected and adversely affect Columbia’s ability to continue its internal growth at historical rates and maintain the quality of its earning assets; (2) changes in interest rates reduce interest margins more than expected and negatively affect funding sources; (3) projected business increases following strategic expansion or opening or acquiring new branches are lower than expected; (4) costs or difficulties related to the integration of acquisitions are greater than expected; (5) competitive pressure among financial institutions increases significantly; (6) legislation or regulatory requirements or changes adversely affect the businesses in which Columbia is engaged.
FINANCIAL STATISTICS
Columbia Banking System, Inc.
| | | | | | | | | | | | | | | | |
| Unaudited | | Three Months Ended
June 30, | | | Six Months Ended June 30, | |
| (in thousands, except per share) | | 2007 | | | 2006 | | | 2007 | | | 2006 | |
Earnings | | | | | | | | | | | | | | | | |
Net interest income | | $ | 25,695 | | | $ | 24,302 | | | $ | 50,398 | | | $ | 48,608 | |
Provision for loan and lease losses | | $ | 329 | | | $ | 250 | | | $ | 967 | | | $ | 465 | |
Noninterest income | | $ | 6,741 | | | $ | 6,267 | | | $ | 12,918 | | | $ | 12,240 | |
Noninterest expense | | $ | 20,266 | | | $ | 21,136 | | | $ | 40,668 | | | $ | 39,476 | |
Net income | | $ | 8,544 | | | $ | 7,239 | | | $ | 15,827 | | | $ | 15,427 | |
Per Share | | | | | | | | | | | | | | | | |
Net income (basic) | | $ | 0.53 | | | $ | 0.45 | | | $ | 0.98 | | | $ | 0.97 | |
Net income (diluted) | | $ | 0.53 | | | $ | 0.45 | | | $ | 0.97 | | | $ | 0.96 | |
Averages | | | | | | | | | | | | | | | | |
Total assets | | $ | 2,654,863 | | | $ | 2,480,585 | | | $ | 2,620,634 | | | $ | 2,434,887 | |
Interest-earning assets | | $ | 2,460,603 | | | $ | 2,268,259 | | | $ | 2,426,676 | | | $ | 2,229,779 | |
Loans | | $ | 1,846,163 | | | $ | 1,613,253 | | | $ | 1,806,150 | | | $ | 1,590,560 | |
Securities | | $ | 582,378 | | | $ | 645,343 | | | $ | 590,122 | | | $ | 632,457 | |
Deposits | | $ | 2,090,273 | | | $ | 1,949,608 | | | $ | 2,045,951 | | | $ | 1,952,713 | |
Core deposits | | $ | 1,485,966 | | | $ | 1,414,455 | | | $ | 1,465,203 | | | $ | 1,419,918 | |
Shareholders’ Equity | | $ | 262,905 | | | $ | 232,614 | | | $ | 259,617 | | | $ | 231,851 | |
Financial Ratios | | | | | | | | | | | | | | | | |
Return on average assets | | | 1.29 | % | | | 1.17 | % | | | 1.22 | % | | | 1.28 | % |
Return on average equity | | | 13.04 | % | | | 12.48 | % | | | 12.29 | % | | | 13.42 | % |
Return on average tangible equity(1) | | | 15.04 | % | | | 14.77 | % | | | 14.23 | % | | | 15.87 | % |
Average equity to average assets | | | 9.90 | % | | | 9.38 | % | | | 9.91 | % | | | 9.52 | % |
Net interest margin | | | 4.36 | % | | | 4.47 | % | | | 4.37 | % | | | 4.56 | % |
Efficiency ratio (tax equivalent) (2) | | | 60.04 | % | | | 60.97 | % | | | 61.68 | % | | | 59.81 | % |
| | | | | | | | | | | | |
| | | June 30, | | | December 31, | |
| | | 2007 | | | 2006 | | | 2006 | |
Period end | | | | | | | | | | | | |
Total assets | | $ | 2,660,946 | | | $ | 2,544,598 | | | $ | 2,553,131 | |
Loans | | $ | 1,859,592 | | | $ | 1,625,255 | | | $ | 1,708,962 | |
Allowance for loan and lease losses | | $ | 21,339 | | | $ | 20,990 | | | $ | 20,182 | |
Securities | | $ | 570,742 | | | $ | 650,955 | | | $ | 605,133 | |
Deposits | | $ | 2,117,325 | | | $ | 1,962,748 | | | $ | 2,023,351 | |
Core deposits | | $ | 1,472,206 | | | $ | 1,418,313 | | | $ | 1,473,701 | |
Shareholders’ equity | | $ | 259,773 | | | $ | 232,241 | | | $ | 252,347 | |
Book value per share | | $ | 16.07 | | | $ | 14.49 | | | $ | 15.71 | |
Tangible book value per share | | $ | 14.06 | | | $ | 12.44 | | | $ | 13.68 | |
Nonperforming assets | | | | | | | | | | | | |
Nonaccrual loans | | $ | 4,972 | | | $ | 4,575 | | | $ | 2,414 | |
Restructured loans | | | 985 | | | | 1,197 | | | | 1,066 | |
Other personal property owned | | | 32 | | | | — | | | | — | |
Other real estate owned | | | — | | | | — | | | | — | |
| | | | | | | | | | | | |
Total nonperforming assets | | $ | 5,989 | | | $ | 5,772 | | | $ | 3,480 | |
| | | | | | | | | | | | |
Nonperforming loans to period-end loans | | | 0.32 | % | | | 0.36 | % | | | 0.20 | % |
Nonperforming assets to period-end assets | | | 0.23 | % | | | 0.23 | % | | | 0.14 | % |
Allowance for loan and lease losses to period-end loans | | | 1.15 | % | | | 1.29 | % | | | 1.18 | % |
Allowance for loan and lease losses to nonperforming loans | | | 358.22 | % | | | 363.65 | % | | | 579.94 | % |
Allowance for loan and lease losses to nonperforming assets | | | 356.30 | % | | | 363.65 | % | | | 579.94 | % |
Net loan charge-offs (recoveries) | | $ | (190 | )(3) | | $ | 304 | (4) | | $ | 2,712 | (5) |
(1) | Annualized net income, excluding core deposit intangible asset amortization, divided by average daily shareholders’ equity, excluding average goodwill and average core deposit intangible asset. |
(2) | Noninterest expense divided by the sum of net interest income and noninterest income on a tax equivalent basis, excluding gain/loss on sale of investment securities, net cost (gain) of OREO and mark-to-market adjustments of interest rate floor instruments. |
(3) | For the six months ended June 30, 2007. |
(4) | For the six months ended June 30, 2006. |
(5) | For the twelve months ended December 31, 2006. |
FINANCIAL STATISTICS
Columbia Banking System, Inc.
| | | | | | | | | | | | |
| | | Period End | |
| Unaudited | | June 30, | | | December 31, | |
| (in thousands) | | 2007 | | | 2006 | | | 2006 | |
Loan Portfolio Composition | | | | | | | | | | | | |
Commercial business | | $ | 681,534 | | | $ | 607,641 | | | $ | 617,899 | |
Real Estate: | | | | | | | | | | | | |
One-to-four family residential | | | 46,299 | | | | 83,290 | | | | 51,277 | |
Five or more family residential and commercial | | | 677,477 | | | | 690,790 | | | | 687,635 | |
| | | | | | | | | | | | |
Total Real Estate | | | 723,776 | | | | 774,080 | | | | 738,912 | |
Real Estate Construction: | | | | | | | | | | | | |
One-to-four family residential | | | 180,925 | | | | 31,260 | | | | 92,124 | |
Five or more family residential and commercial | | | 127,769 | | | | 71,587 | | | | 115,185 | |
| | | | | | | | | | | | |
Total Real Estate Construction | | | 308,694 | | | | 102,847 | | | | 207,309 | |
Consumer | | | 148,869 | | | | 142,969 | | | | 147,782 | |
| | | | | | | | | | | | |
Subtotal loans | | | 1,862,873 | | | | 1,627,537 | | | | 1,711,902 | |
Less: Deferred loan fees | | | (3,281 | ) | | | (2,282 | ) | | | (2,940 | ) |
| | | | | | | | | | | | |
Total loans | | $ | 1,859,592 | | | $ | 1,625,255 | | | $ | 1,708,962 | |
| | | | | | | | | | | | |
Loans held for sale | | $ | 2,551 | | | $ | 1,288 | | | $ | 933 | |
| | | | | | | | | | | | |
Deposit Composition | | | | | | | | | | | | |
Demand and other noninterest bearing | | $ | 419,695 | | | $ | 446,568 | | | $ | 432,293 | |
Interest bearing demand | | | 440,051 | | | | 367,891 | | | | 414,198 | |
Money market | | | 509,463 | | | | 488,615 | | | | 516,415 | |
Savings | | | 102,997 | | | | 115,239 | | | | 110,795 | |
Certificates of deposit | | | 645,119 | | | | 544,435 | | | | 549,650 | |
| | | | | | | | | | | | |
Total deposits | | $ | 2,117,325 | | | $ | 1,962,748 | | | $ | 2,023,351 | |
| | | | | | | | | | | | |
QUARTERLY FINANCIAL STATISTICS
Columbia Banking System, Inc.
| | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended | |
| Unaudited | | Jun 30 | | | Mar 31 | | | Dec 31 | | | Sept 30 | | | Jun 30 | |
| (in thousands, except per share) | | 2007 | | | 2007 | | | 2006 | | | 2006 | | | 2006 | |
Earnings | | | | | | | | | | | | | | | | | | | | |
Net interest income | | $ | 25,695 | | | $ | 24,703 | | | $ | 24,750 | | | $ | 24,405 | | | $ | 24,302 | |
Provision for loan and lease losses | | $ | 329 | | | $ | 638 | | | $ | 950 | | | $ | 650 | | | $ | 250 | |
Noninterest income | | $ | 6,741 | | | $ | 6,177 | | | $ | 6,324 | | | $ | 6,108 | | | $ | 6,267 | |
Noninterest expense | | $ | 20,266 | | | $ | 20,402 | | | $ | 18,560 | | | $ | 18,098 | | | $ | 21,136 | |
Net income | | $ | 8,544 | | | $ | 7,283 | | | $ | 8,341 | | | $ | 8,335 | | | $ | 7,239 | |
Per Share | | | | | | | | | | | | | | | | | | | | |
Net income (basic) | | $ | 0.53 | | | $ | 0.45 | | | $ | 0.52 | | | $ | 0.52 | | | $ | 0.45 | |
Net income (diluted) | | $ | 0.53 | | | $ | 0.45 | | | $ | 0.52 | | | $ | 0.52 | | | $ | 0.45 | |
Averages | | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 2,654,863 | | | $ | 2,586,025 | | | $ | 2,517,836 | | | $ | 2,504,371 | | | $ | 2,480,585 | |
Interest-earning assets | | $ | 2,460,603 | | | $ | 2,392,372 | | | $ | 2,310,502 | | | $ | 2,290,351 | | | $ | 2,268,259 | |
Loans | | $ | 1,846,163 | | | $ | 1,765,692 | | | $ | 1,688,600 | | | $ | 1,647,471 | | | $ | 1,613,253 | |
Securities | | $ | 582,378 | | | $ | 597,952 | | | $ | 602,075 | | | $ | 627,821 | | | $ | 645,343 | |
Deposits | | $ | 2,090,273 | | | $ | 2,001,136 | | | $ | 2,024,108 | | | $ | 1,975,103 | | | $ | 1,949,608 | |
Core deposits | | $ | 1,485,966 | | | $ | 1,444,210 | | | $ | 1,459,281 | | | $ | 1,433,641 | | | $ | 1,414,455 | |
Shareholders’ Equity | | $ | 262,905 | | | $ | 256,292 | | | $ | 249,202 | | | $ | 238,272 | | | $ | 232,614 | |
Financial Ratios | | | | | | | | | | | | | | | | | | | | |
Return on average assets | | | 1.29 | % | | | 1.14 | % | | | 1.31 | % | | | 1.32 | % | | | 1.17 | % |
Return on average equity | | | 13.04 | % | | | 11.52 | % | | | 13.28 | % | | | 13.88 | % | | | 12.48 | % |
Return on average tangible equity | | | 15.04 | % | | | 13.38 | % | | | 15.49 | % | | | 16.32 | % | | | 14.77 | % |
Average equity to average assets | | | 9.90 | % | | | 9.91 | % | | | 9.90 | % | | | 9.51 | % | | | 9.38 | % |
Net interest margin | | | 4.36 | % | | | 4.37 | % | | | 4.43 | % | | | 4.41 | % | | | 4.47 | % |
Efficiency ratio (tax equivalent) | | | 60.04 | % | | | 63.39 | % | | | 57.41 | % | | | 58.81 | % | | | 60.97 | % |
Period end | | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 2,660,946 | | | $ | 2,676,204 | | | $ | 2,553,131 | | | $ | 2,507,450 | | | $ | 2,544,598 | |
Loans | | $ | 1,859,592 | | | $ | 1,833,852 | | | $ | 1,708,962 | | | $ | 1,655,809 | | | $ | 1,625,255 | |
Allowance for loan and lease losses | | $ | 21,339 | | | $ | 20,819 | | | $ | 20,182 | | | $ | 20,926 | | | $ | 20,990 | |
Securities | | $ | 570,742 | | | $ | 599,306 | | | $ | 605,133 | | | $ | 611,497 | | | $ | 650,955 | |
Deposits | | $ | 2,117,325 | | | $ | 2,081,026 | | | $ | 2,023,351 | | | $ | 2,020,065 | | | $ | 1,962,748 | |
Core deposits | | $ | 1,472,206 | | | $ | 1,518,797 | | | $ | 1,473,701 | | | $ | 1,460,634 | | | $ | 1,418,313 | |
Shareholders’ equity | | $ | 259,773 | | | $ | 261,329 | | | $ | 252,347 | | | $ | 245,801 | | | $ | 232,241 | |
Book value per share | | $ | 16.07 | | | $ | 16.17 | | | $ | 15.71 | | | $ | 15.32 | | | $ | 14.49 | |
Tangible book value per share | | $ | 14.06 | | | $ | 14.16 | | | $ | 13.68 | | | $ | 13.27 | | | $ | 12.44 | |
Nonperforming assets | | | | | | | | | | | | | | | | | | | | |
Nonaccrual loans | | $ | 4,972 | | | $ | 2,580 | | | $ | 2,414 | | | $ | 4,101 | | | $ | 4,575 | |
Restructured loans | | | 985 | | | | 806 | | | | 1,066 | | | | 804 | | | | 1,197 | |
Other personal property owned | | | 32 | | | | — | | | | — | | | | — | | | | — | |
Other real estate owned | | | — | | | | — | | | | — | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | |
Total nonperforming assets | | $ | 5,989 | | | $ | 3,386 | | | $ | 3,480 | | | $ | 4,905 | | | $ | 5,772 | |
| | | | | | | | | | | | | | | | | | | | |
Nonperforming loans to period-end loans | | | 0.32 | % | | | 0.18 | % | | | 0.20 | % | | | 0.30 | % | | | 0.36 | % |
Nonperforming assets to period-end assets | | | 0.23 | % | | | 0.13 | % | | | 0.14 | % | | | 0.20 | % | | | 0.23 | % |
Allowance for loan and lease losses to period-end loans | | | 1.15 | % | | | 1.14 | % | | | 1.18 | % | | | 1.26 | % | | | 1.29 | % |
Allowance for loan and lease losses to nonperforming loans | | | 358.22 | % | | | 614.86 | % | | | 579.94 | % | | | 426.63 | % | | | 363.65 | % |
Allowance for loan and lease losses to nonperforming assets | | | 356.30 | % | | | 614.86 | % | | | 579.94 | % | | | 426.63 | % | | | 363.65 | % |
Net loan charge-offs (recoveries) | | $ | (191 | ) | | $ | 1 | | | $ | 1,694 | | | $ | 714 | | | $ | (49 | ) |
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
Columbia Banking System, Inc.
| | | | | | | | | | | | | | |
| (Unaudited) | | Three Months Ended
June 30, | | | Six Months Ended
June 30, | |
| (in thousands, except per share) | | 2007 | | 2006 | | | 2007 | | 2006 | |
Interest Income | | | | | | | | | | | | | | |
Loans | | $ | 36,224 | | $ | 30,328 | | | $ | 70,254 | | $ | 58,972 | |
Taxable securities | | | 4,657 | | | 5,208 | | | | 9,442 | | | 10,166 | |
Tax-exempt securities | | | 1,960 | | | 1,753 | | | | 3,920 | | | 3,180 | |
Federal funds sold and deposits with banks | | | 414 | | | 121 | | | | 785 | | | 161 | |
| | | | | | | | | | | | | | |
Total interest income | | | 43,255 | | | 37,410 | | | | 84,401 | | | 72,479 | |
| | | | |
Interest Expense | | | | | | | | | | | | | | |
Deposits | | | 13,617 | | | 9,408 | | | | 25,776 | | | 17,899 | |
Federal Home Loan Bank advances | | | 2,484 | | | 3,206 | | | | 5,663 | | | 4,974 | |
Long-term obligations | | | 513 | | | 492 | | | | 1,020 | | | 951 | |
Other borrowings | | | 946 | | | 2 | | | | 1,544 | | | 47 | |
| | | | | | | | | | | | | | |
Total interest expense | | | 17,560 | | | 13,108 | | | | 34,003 | | | 23,871 | |
| | | | | | | | | | | | | | |
Net Interest Income | | | 25,695 | | | 24,302 | | | | 50,398 | | | 48,608 | |
Provision for loan and lease losses | | | 329 | | | 250 | | | | 967 | | | 465 | |
| | | | | | | | | | | | | | |
Net interest income after provision for loan and lease losses | | | 25,366 | | | 24,052 | | | | 49,431 | | | 48,143 | |
| | | | |
Noninterest Income | | | | | | | | | | | | | | |
Service charges and other fees | | | 3,293 | | | 2,907 | | | | 6,252 | | | 5,741 | |
Merchant services fees | | | 2,124 | | | 2,174 | | | | 4,093 | | | 4,212 | |
Gain on sale of securities available for sale, net | | | — | | | — | | | | — | | | 10 | |
Bank owned life insurance (“BOLI”) | | | 451 | | | 434 | | | | 877 | | | 833 | |
Other | | | 873 | | | 752 | | | | 1,696 | | | 1,444 | |
| | | | | | | | | | | | | | |
Total noninterest income | | | 6,741 | | | 6,267 | | | | 12,918 | | | 12,240 | |
| | | | |
Noninterest Expense | | | | | | | | | | | | | | |
Compensation and employee benefits | | | 10,848 | | | 9,426 | | | | 22,206 | | | 19,095 | |
Occupancy | | | 2,945 | | | 2,685 | | | | 5,782 | | | 5,333 | |
Merchant processing | | | 884 | | | 887 | | | | 1,707 | | | 1,671 | |
Advertising and promotion | | | 657 | | | 854 | | | | 1,204 | | | 1,506 | |
Data processing | | | 553 | | | 520 | | | | 1,120 | | | 1,320 | |
Legal & professional services | | | 687 | | | 737 | | | | 1,510 | | | 967 | |
Taxes, licenses & fees | | | 703 | | | 640 | | | | 1,316 | | | 1,236 | |
Gain on sale of other real estate owned, net | | | — | | | (11 | ) | | | — | | | (11 | ) |
Interest rate floor valuation adjustment | | | — | | | 1,775 | | | | — | | | 1,775 | |
Other | | | 2,989 | | | 3,623 | | | | 5,823 | | | 6,584 | |
| | | | | | | | | | | | | | |
Total noninterest expense | | | 20,266 | | | 21,136 | | | | 40,668 | | | 39,476 | |
| | | | | | | | | | | | | | |
Income before income taxes | | | 11,841 | | | 9,183 | | | | 21,681 | | | 20,907 | |
Provision for income taxes | | | 3,297 | | | 1,944 | | | | 5,854 | | | 5,480 | |
| | | | | | | | | | | | | | |
Net Income | | | 8,544 | | | 7,239 | | | $ | 15,827 | | $ | 15,427 | |
| | | | | | | | | | | | | | |
Net income per common share: | | | | | | | | | | | | | | |
Basic | | $ | .53 | | $ | .45 | | | $ | 0.98 | | $ | 0.97 | |
Diluted | | $ | .53 | | $ | .45 | | | $ | 0.97 | | $ | 0.96 | |
Dividend paid per common share | | $ | 0.17 | | $ | 0.14 | | | $ | 0.32 | | $ | 0.27 | |
Average number of common shares outstanding | | | 16,126 | | | 15,937 | | | | 16,115 | | | 15,907 | |
Average number of diluted common shares outstanding | | | 16,258 | | | 16,115 | | | | 16,261 | | | 16,095 | |
CONSOLIDATED CONDENSED BALANCE SHEETS
Columbia Banking System, Inc.
| | | | | | | | | | | | |
(Unaudited) (in thousands) | | | | | | June 30, 2007 | | | December 31, 2006 | |
Assets | | | | | | | | | | | | |
Cash and due from banks | | | | | | $ | 69,829 | | | $ | 76,365 | |
Interest-earning deposits with banks | | | | | | | 15,070 | | | | 13,979 | |
Federal funds sold | | | | | | | 6,600 | | | | 14,000 | |
| | | | | | | | | | | | |
Total cash and cash equivalents | | | | | | | 91,499 | | | | 104,344 | |
| | | | |
Securities available for sale at fair value (amortized cost of $570,891 and $598,703 respectively) | | | | | | | 558,716 | | | | 592,858 | |
Securities held to maturity at cost (fair value of $1,618 and $1,871 respectively) | | | | | | | 1,573 | | | | 1,822 | |
Federal Home Loan Bank stock at cost | | | | | | | 10,453 | | | | 10,453 | |
Loans held for sale | | | | | | | 2,551 | | | | 933 | |
Loans, net of deferred loan fees of ($3,281) and ($2,940), respectively | | | | | | | 1,859,592 | | | | 1,708,962 | |
Less: allowance for loan and lease losses | | | | | | | 21,339 | | | | 20,182 | |
| | | | | | | | | | | | |
Loans, net | | | | | | | 1,838,253 | | | | 1,688,780 | |
| | | | |
Interest receivable | | | | | | | 13,349 | | | | 12,549 | |
Premises and equipment, net | | | | | | | 44,959 | | | | 44,635 | |
Goodwill | | | | | | | 29,723 | | | | 29,723 | |
Other assets | | | | | | | 69,870 | | | | 67,034 | |
| | | | | | | | | | | | |
Total Assets | | | | | | $ | 2,660,946 | | | $ | 2,553,131 | |
| | | | | | | | | | | | |
Liabilities and Shareholders’ Equity | | | | | | | | | | | | |
Deposits: | | | | | | | | | | | | |
Noninterest-bearing | | | | | | $ | 419,695 | | | $ | 432,293 | |
Interest-bearing | | | | | | | 1,697,630 | | | | 1,591,058 | |
| | | | | | | | | | | | |
Total deposits | | | | | | | 2,117,325 | | | | 2,023,351 | |
| | | | |
Short-term borrowings: | | | | | | | | | | | | |
Federal Home Loan Bank advances | | | | | | | 161,700 | | | | 205,800 | |
Securities sold under agreements to repurchase | | | | | | | 70,000 | | | | 20,000 | |
Other borrowings | | | | | | | 49 | | | | 198 | |
| | | | | | | | | | | | |
Total short-term borrowings | | | | | | | 231,749 | | | | 225,998 | |
Long-term subordinated debt | | | | | | | 22,411 | | | | 22,378 | |
Other liabilities | | | | | | | 29,688 | | | | 29,057 | |
| | | | | | | | | | | | |
Total liabilities | | | | | | | 2,401,173 | | | | 2,300,784 | |
| | | | |
Commitments and contingent liabilities | | | | | | | — | | | | — | |
Shareholders’ equity: | | | | | | | | | | | | |
Preferred stock (no par value) Authorized, 2 million shares; none outstanding | | | | | | | — | | | | — | |
| | | | |
| | | June 30,
2007 | | December 31,
2006 | | | | | | |
Common stock (no par value) | | | | | | | | | | | | |
Authorized shares | | 63,034 | | 63,034 | | | | | | | | |
Issued and outstanding | | 16,166 | | 16,060 | | | 168,401 | | | | 166,763 | |
Retained earnings | | | | | | | 99,701 | | | | 89,037 | |
Accumulated other comprehensive loss | | | | | | | (8,329 | ) | | | (3,453 | ) |
| | | | | | | | | | | | |
Total shareholders’ equity | | | | | | | 259,773 | | | | 252,347 | |
Total Liabilities and Shareholders’ Equity | | | | | | $ | 2,660,946 | | | $ | 2,553,131 | |
| | | | | | | | | | | | |
