Exhibit 99.1
The First Bancshares, Inc. Reports 3rd Quarter Earnings
HATTIESBURG, Miss.--(BUSINESS WIRE)--October 29, 2008--The First Bancshares, Inc., (NASDAQGS: FBMS), holding company for The First, A National Banking Association, (www.thefirstbank.com) today reported earnings for the third quarter which ended September 30, 2008 and today announced its Board of Directors has voted to suspend regular quarterly cash dividends effective immediately on its common stock.
David E. Johnson, Chairman and CEO stated, “Our Board remains committed to the preservation of capital during these challenging industry conditions. The decision to suspend cash dividends was not taken lightly and will improve our capital position by saving approximately $225,000 of capital per quarter.” Johnson continued, “We believe it is the best course of action for our shareholders over the long term. We expect to resume paying cash dividends as soon as deemed appropriate.”
Earnings for the three months ended September 30, 2008 were $335,000, a decrease from earnings of $1,293,000 in the comparable quarter in 2007. Nine month earnings for the period ended September 30, 2008 were $1,464,000 compared to $3,116,000 for the comparable period in 2007, a decrease of 53%.
The following are key achievements in the last nine months ended September 30, 2008:
- Net interest margin increased to 3.99% from 3.88% at June 30, 2008
- Total borrowed funds decreased 22.2% to $47,255,000
- Total cash and due from banks including fed funds sold increased 177.7%
- Total deposits increased 1.5% to $391,880,000
Deposits
Total deposits increased to $391,880,000 in the period ended September 30, 2008, a 1.5% increase over the period ended December 31, 2007. Deposits grew 11.7% over the comparable nine month period in 2007.
Loans
Total loans decreased 9.2% to $332,014,000 for the nine month period ended September 30, 2008 compared to the period ended December 31, 2007. The decrease in total loans is due in part to the slow down of the economy and to certain credits moving out of the bank or paying off as planned. The provision for loan losses increased $405,000 for the three months ended September 30, 2008 as compared to the same period in 2007. This increase reflects the local and national economic trends and the potential effects on the loan portfolio.
Net Income and Earnings Per Share
Net income was $335,000 and $1,464,000 for the three and nine months ended September 30, 2008, decreases of 74.1% and 53% over comparable periods in 2007. Diluted earnings per share for the three month period ended September 30, 2008 amounted to $0.11 per share a 73.8% decrease from the comparable period in 2007 of $0.42. Diluted earnings per share amounted to $0.48 for the nine month period ended September 30, 2008, a 52.9% decrease from the comparable period in 2007 of $1.02.
Net interest income decreased 1.3% for the nine months ended September 30, 2008 compared to the same period in 2007. The Company has seen a decline in the net interest margin from 4.31% for the nine months ended September 30, 2007 to 3.99% for the comparable period ended September 30, 2008. Since year end, December 31, 2007, the Company has been reducing its cost of funds by paying off high rate debt at the Federal Home Loan Bank and by reducing the balance in certificates of deposits greater than $100,000 by $29,220,000 or 28%. The effort to reduce its cost of funds was offset by a greater reduction in the yield on earning assets during the nine months ended September 30, 2008. The effort to reduce the Company’s funding costs will continue as certificates of deposits are being repriced daily.
Non-interest income increased to $2,472,000, an increase of 6.2% for the nine months ended September 30, 2008 as compared to the same period in 2007. A 21.1% increase in income from deposit accounts attributed to the overall increase in non-interest income.
Non-interest expense increased 12.8% for the nine months ended September 30, 2008 as compared to the same period in 2007. Costs related to the opening of our temporary location in Gulfport, Ms attributed to the increase as well as overlapping expenses related to the moving of administrative and operations personnel to owned space from leased spaces.
David E. Johnson, CEO stated, “Decreased net interest income due to falling rates, increased provision for loan losses and increases in our non-interest expenses have contributed to our decreased net earnings. Our current capital classifies us as a “well-capitalized” bank. We have good liquidity and plenty of money to lend.” Johnson continued, “Despite a reduction in our loan portfolio volumes over the last nine months, we believe that the markets we are in will sustain our overall growth objectives for the long term. We think it is important to move cautiously through this slowdown and reassess our strategy in order to grow our bank in a prudent manner.”
The First Bancshares, Inc. headquartered in Hattiesburg, Mississippi is the holding company for The First, a National Banking Association. The First operates ten branches in southern Mississippi. The First Bancshares has $490,000 million in assets and has 2,990,201 shares outstanding traded on the NASDAQ Global Market with the symbol of FBMS. For more information, go to www.thefirstbank.com.
Forward Looking Statement
This news release contains statements regarding the projected performance of The First Bancshares, Inc. and its subsidiary. These statements constitute forward-looking information within the meaning of the Private Securities Litigation Reform Act. Actual results may differ materially from the projections provided in this release since such projections involve significant known and unknown risks and uncertainties. Factors that might cause such differences include, but are not limited to: competitive pressures among financial institutions increasing significantly; economic conditions, either nationally or locally, in areas in which the Company conducts operations being less favorable than expected; and legislation or regulatory changes which adversely affect the ability of the combined Company to conduct business combinations or new operations. The Company disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments. Further information on The First Bancshares, Inc. is available in its filings with the Securities and Exchange Commission, available at the SEC’s website, http://www.sec.gov.
| THE FIRST BANCSHARES, INC. |
| FINANCIAL HIGHLIGHTS |
| (Unaudited) |
| |
| ($ amounts in thousands except |
| earnings per share) |
| |
| | For the three months ended
Sept 30, | | For the nine months ended
Sept 30, |
| | |
| | |
| | | 2008 | | | 2007 | | | 2008 | | | 2007 |
| |
| Interest income | | $ | 7,672 | | $ | 8,909 | | $ | 24,522 | | $ | 24,641 |
| Interest expense | | | 3,183 | | | 3,987 | | | 10,989 | | | 10,934 |
| Net interest income | | | 4,489 | | | 4,922 | | | 13,533 | | | 13,707 |
| Provision for loan losses | | | 721 | | | 316 | | | 1,721 | | | 966 |
| Net interest income after provision for loan losses | | | | | | | | |
| | 3,768 | | | 4,606 | | | 11,812 | | | 12,741 |
| Non-interest income | | | 795 | | | 966 | | | 2,472 | | | 2,327 |
| Non-interest expense | | | 4,085 | | | 3,783 | | | 12,224 | | | 10,839 |
| Income before income taxes | | | 478 | | | 1,789 | | | 2,060 | | | 4,229 |
| Income taxes | | | 143 | | | 496 | | | 596 | | | 1,113 |
| Net income | | $ | 335 | | $ | 1,293 | | $ | 1,464 | | $ | 3,116 |
| |
| Basic: | | | | | | | | |
| Earnings per share | | $ | .11 | | $ | .43 | | $ | .49 | | $ | 1.05 |
| Diluted: | | | | | | | | |
| Earnings per share | | $ | .11 | | $ | .42 | | $ | .48 | | $ | 1.02 |
| |
| Dividends per share | | $ | .075 | | $ | .075 | | $ | .225 | | $ | .45 |
| |
| | Sept 30, | | December 31, | | Sept 30, | | |
| | | 2008 | | | 2007 | | | 2007 | | |
| |
| Total assets | | | 489,456 | | | 496,056 | | | 491,729 | | |
| Cash and due from banks | | | 17,866 | | | 11,118 | | | 9,313 | | |
| Federal funds sold | | | 13,632 | | | 223 | | | 2,459 | | |
| Investment securities | | | 96,104 | | | 87,052 | | | 88,398 | | |
| Loans, net of unearned interest | | | | | | | | |
| | 332,014 | | | 365,559 | | | 366,833 | | |
| Deposits-interest bearing | | | 335,986 | | | 330,819 | | | 329,180 | | |
| Deposits-non interest bearing | | | 55,894 | | | 55,349 | | | 63,663 | | |
| Total deposits | | | 391,880 | | | 386,168 | | | 392,843 | | |
| Borrowed funds | | | 47,255 | | | 60,773 | | | 51,360 | | |
| Subordinated debentures | | | 10,310 | | | 10,310 | | | 10,310 | | |
| Stockholders' equity | | | 35,983 | | | 36,281 | | | 34,758 | | |
| Book value (per share) | | $ | 12.03 | | $ | 12.14 | | $ | 11.63 | | |
| Total shares outstanding | | | 2,990,201 | | | 2,988,551 | | | 2,987,884 | | |
CONTACT:
The First Bancshares
David Johnson, CEO, 601-450-8888
or
Dee Dee Lowery, CFO, 601-450-8888
