Exhibit 99
PRESS RELEASE
Contact:
Todd A. Gipple
Executive Vice President
Chief Financial Officer
(309) 736-3580
FOR IMMEDIATE RELEASE
August 5, 2002
QCR Holdings, Inc.
Announces Fourth Fiscal Quarter Earnings Results
QCR Holdings, Inc. (NASDAQ / QCRH) today announced earnings for the fourth
fiscal quarter ended June 30, 2002 of $1.0 million, or basic earnings per share
of $0.37 and diluted earnings per share of $0.36. For the same fiscal quarter in
2001, the Company reported earnings of $769,000, or both basic and diluted
earnings per share of $0.34. Earnings for the twelve months ended June 30, 2002
were $3.0 million, or basic and diluted earnings per share of $1.10 and $1.08,
respectively, as compared to $2.4 million, or basic and diluted earnings per
share of $1.06 and $1.04, respectively, for the same period in fiscal 2001.
"We are very pleased with the operating results for the quarter and year ended
June 30, 2002," said Doug Hultquist, President and Chief Executive Officer. "The
Company recognized significant increases in net interest income of $1,321,000
for the quarter and $3,718,000 for the year ended June 30, 2002. Gains on sales
of residential real estate loans were also a significant contributor to our
earnings results for the fiscal year as the Company realized an increase in
gains of $855,000 over the previous year. The Company also achieved a very
significant milestone this quarter as consolidated assets have grown to more
than $500 million."
Michael Bauer, Chairman of the Company and President and Chief Executive Officer
of Quad City Bank & Trust added, "We worked hard to significantly increase
earnings at Quad City Bank and Trust this year. As a result of considerable
improvements in the bank's net interest margin, and other factors, Quad City
Bank and Trust generated returns on assets and equity of 1.14% and 15.10%,
respectively for the fiscal year." He continued, "The Company was also well
positioned to take advantage of the significant residential real estate mortgage
volume created by the record low mortgage rates in the last half of calendar
2001. While, as we anticipated, mortgage volumes have decreased in calendar
2002, we believe that we have continued to expand our share of the residential
mortgage market both in the Quad Cities and in Cedar Rapids."
The significant earnings improvements in net interest margin and gains on sales
of real estate loans for the year were partially offset by the anticipated
start-up costs at the Company's newly chartered bank subsidiary, Cedar Rapids
Bank & Trust, and increased loan loss provision expense, primarily due to
substantial loan growth at the Company's subsidiary banks during the period.
Also impacting earnings for the year ended June 30, 2002 were legal costs at the
Company's subsidiary, Quad City Bancard, related to its arbitration proceedings
to collect a large customer receivable and the subsequent settlement of the
dispute in February 2002. As a result of the settlement, an amount was paid by
the customer to Bancard, which resulted in the collection of the receivable,
less an amount that approximated the costs of continued arbitration. The effect
of the settlement was a reduction in third fiscal quarter after-tax earnings of
approximately $175,000. While management believed that the claims were without
merit, a determination was made that a settlement at that time was the most cost
effective option for the Company.
"We are quite pleased that reported earnings per share for the 2002 fiscal year
have surpassed the prior year level, even with the current year impact of the
start-up costs at our new charter, the Bancard settlement and related legal
costs, and the increased loan loss provisions required due to the 36% growth in
our loan portfolio. While after-tax start-up losses at Cedar Rapids Bank and
Trust, including the pre-charter branch losses, were $1,114,000 this fiscal
year, these losses have been slightly less than anticipated, while the bank's
growth has been more rapid than expected," noted Todd Gipple, Executive Vice
President and Chief Financial Officer. He added, "We were very focused on
improving our net interest margin during the fiscal year. As a result of these
efforts, our net interest margin improved to 3.87% and 3.74% for the quarter and
twelve months ended June 30, 2002, as compared to one year ago when it was 3.45%
for the quarter and 3.36% for the one-year period."
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The Company's total assets increased 29% to $518.8 million at June 30, 2002 from
$400.9 million at June 30, 2001. During the same period, net loans increased by
$100.9 million or 36% to $384.5 million from $283.6 million at June 30, 2001.
Non-performing assets decreased to $2.3 million at June 30, 2002 from a high
during the 2002 fiscal year of $3.7 million at December 31, 2001. While they
ended the year higher than at the previous fiscal year end, the percentage
increase in non-performing assets year over year was less than the growth in the
Company's loan portfolio. Total deposits increased 25% to $376.3 million at June
30, 2002 from $302.1 million at June 30, 2001. Stockholders' equity rose to
$32.6 million at June 30, 2002 as compared to $23.8 million at June 30, 2001.
Contributing to the increase in stockholders' equity, in addition to earnings
for the period, was a $5.0 million private placement of common stock in
September 2001 in conjunction with the opening of the new bank in Cedar Rapids.
"Cedar Rapids Bank & Trust continues to be a significant contributor to the
Company's growth in assets, loans, and deposits since our opening in
mid-September of 2001. We have experienced rapid growth in our first nine months
of operations and our charter has reached total assets of $63 million, net loans
of $49 million, and deposits of $42 million as of June 30, 2002," noted Cedar
Rapids Bank & Trust President and Chief Executive Officer, Larry Helling. He
added, "We continue to add new commercial and retail banking relationships each
week, and we are pleased with the market's reaction to our strategy of providing
the highest levels of service and a personalized banking relationship."
QCR Holdings, Inc., headquartered in Moline, Illinois, is a multi-bank holding
company, which serves the Quad City and Cedar Rapids communities via its wholly
owned subsidiaries. Quad City Bank and Trust Company, which is based in
Bettendorf, Iowa and commenced operations in 1994, and Cedar Rapids Bank and
Trust Company, which is based in Cedar Rapids, Iowa and commenced operations in
2001, provide full-service commercial and consumer banking and trust and asset
management services. The Company also engages in merchant credit card processing
through its wholly owned subsidiary, Quad City Bancard, Inc., based in Moline,
Illinois.
Special Note Concerning Forward-Looking Statements. This document (including
information incorporated by reference) contains, and future oral and written
statements of the Company and its management may contain, forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995 with respect to the financial condition, results of operations, plans,
objectives, future performance and business of the Company. Forward-looking
statements, which may be based upon beliefs, expectations and assumptions of the
Company's management and on information currently available to management, are
generally identifiable by the use of words such as "believe," "expect,"
"anticipate," "predict," "suggest," "appear," "plan," "intend," "estimate,"
"may," "will," "would," "could," "should" or other similar expressions.
Additionally, all statements in this document, including forward-looking
statements, speak only as of the date they are made, and the Company undertakes
no obligation to update any statement in light of new information or future
events.
A number of factors, many of which are beyond the ability of the Company to
control or predict, could cause actual results to differ materially from those
in its forward-looking statements. These factors include, among others, the
following: (i) the strength of the local and national economy; (ii) the economic
impact of September 11th; (iii) changes in state and federal laws, regulations
and governmental policies concerning the Company's general business; (iv)
changes in interest rates and prepayment rates of the Company's assets; (v)
increased competition in the financial services sector and the inability to
attract new customers; (vi) changes in technology and the ability to develop and
maintain secure and reliable electronic systems; (vii) the loss of key
executives or employees; (viii) changes in consumer spending; (ix) unexpected
results of acquisitions; (x) unexpected outcomes of existing or new litigation
involving the Company; and (xi) changes in accounting policies and practices.
These risks and uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such statements.
Additional information concerning the Company and its business, including
additional factors that could materially affect the Company's financial results,
is included in the Company's filings with the Securities and Exchange
Commission.
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As of
---------------------------
June 30, June 30,
2002 2001
---------------------------
(dollars in thousands, except share data)
SELECTED BALANCE SHEET DATA
Total assets ................................. $ 518,828 $ 400,948
Securities ................................... 76,231 56,710
Total loans .................................. 390,594 287,865
Allowance for estimated loan losses .......... 6,111 4,248
Total deposits ............................... 376,317 302,155
Total stockholders' equity ................... 32,578 23,817
Common shares outstanding .................... 2,749,447 2,265,420
Book value per common share .................. 11.85 $ 10.51
Full time equivalent employees ............... 190 167
Tier 1 leverage capital ratio ................ 8.25% 7.78%
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As of
----------------------
June 30, June 30,
2002 2001
----------------------
(dollars in thousands)
ANALYSIS OF LOAN DATA
Nonaccrual loans ................................... $ 1,560 $ 1,232
Accruing loans past due 90 days or more ............ 708 495
Other real estate owned ............................ -- 47
Total nonperforming assets ......................... 2,268 1,774
Net charge-offs (For the fiscal year ended) ........ $ 402 $ 259
Loan mix:
Commercial ....................................... $305,043 $209,889
Real estate ...................................... 45,418 40,587
Installment and other consumer ................... 40,133 37,389
Total loans ........................................ 390,594 287,865
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For The For The
Quarter Ended Twelve Months Ended
June 30, June 30,
--------------------------------------------
2002 2001 2002 2001
--------------------------------------------
(dollars in thousands, except per share data)
SELECTED INCOME STATEMENT DATA
Interest income ............................ $ 7,592 $ 7,021 $ 28,520 $ 28,544
Interest expense ........................... 3,106 3,856 12,870 16,612
Net interest income ........................ 4,486 3,165 15,650 11,932
Provision for loan losses .................. 728 221 2,265 889
Noninterest income ......................... 2,046 1,894 7,915 6,313
Noninterest expense ........................ 4,382 3,785 17,023 13,800
Income tax expense ......................... 411 284 1,315 1,160
Net income ................................. 1,011 769 2,962 2,396
Earnings per common share (basic) .......... $ 0.37 $ 0.34 $ 1.10 $ 1.06
Earnings per common share (diluted) ........ $ 0.36 $ 0.34 $ 1.08 $ 1.04
AVERAGE BALANCES
Assets ..................................... $510,796 $401,102 $461,053 $384,890
Deposits ................................... 369,955 298,564 336,875 299,070
Loans ...................................... 371,120 283,049 334,205 265,350
Stockholders' equity ....................... 31,620 23,318 29,413 21,886
KEY RATIOS
Return on average assets (annualized) ...... 0.79% 0.77% 0.64% 0.62%
Return on average common equity (annualized) 12.79% 13.19% 10.07% 10.95%
Net interest margin ........................ 3.87% 3.45% 3.74% 3.36%
Efficiency ratio ........................... 67.06% 74.79% 72.20% 75.55%
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For the Quarter Ended For the Twelve Months Ended
June 30, June 30,
-----------------------------------------------------
2002 2001 2002 2001
-----------------------------------------------------
(dollars in thousands, except share data)
ANALYSIS OF NONINTEREST INCOME
Merchant credit card fees, net of processing costs $ 660 $ 471 $ 2,097 $ 1,673
Trust department fees ............................ 571 489 2,162 2,072
Deposit service fees ............................. 276 251 995 816
Gain on sales of loans, net ...................... 341 525 1,992 1,137
Securities gains (losses), net ................... 7 9 6 (14)
Other ............................................ 191 148 663 629
Total noninterest income ...................... 2,046 1,893 7,915 6,313
ANALYSIS OF NONINTEREST EXPENSE
Salaries and employee benefits ................... $ 2,765 $ 2,173 $ 10,077 $ 8,014
Professional and data processing fees ............ 299 300 1,411 1,160
Advertising and marketing ........................ 169 186 604 580
Occupancy and equipment expense .................. 589 519 2,332 1,926
Stationery and supplies .......................... 115 99 476 352
Postage and telephone ............................ 130 118 486 410
Other ............................................ 315 390 1,637 1,358
Total noninterest expenses .................... 4,382 3,785 17,023 13,800
WEIGHTED AVERAGE SHARES
Common shares outstanding (a) .................... 2,746,289 2,265,420 2,685,996 2,268,465
Incremental shares from assumed conversion:
Options ...................................... 68,620 36,712 57,809 45,869
Adjusted weighted average shares (b) ............. 2,814,909 2,302,132 2,743,805 2,314,334
<FN>
(a) Denominator for Basic Earnings Per Share
(b) Denominator for Diluted Earnings Per Share
</FN>
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