PRESS RELEASE
Contact:
Todd A. Gipple
Executive Vice President
Chief Financial Officer
(309) 736-3580
FOR IMMEDIATE RELEASE
October 23, 2002
QCR Holdings, Inc.
Announces Cash Dividend and First Fiscal Quarter Earnings Results
QCR Holdings, Inc. (NASDAQ / QCRH) today announced that the Board of
Directors has declared a cash dividend of $.05 per share payable on January 3,
2003, to stockholders of record on December 16, 2002.
"We are very pleased to announce the Company's first cash dividend to
stockholders," said Michael Bauer, Chairman of the Company and President of Quad
City Bank & Trust. He added, "It is the Company's intention to consider the
payment of dividends on a semi-annual basis. While we anticipate an ongoing need
to retain much of the Company's operating income to help provide the capital for
continued rapid growth, we believe that operating results have reached a level
where we can sustain dividends to our stockholders as well."
The Company also announced earnings for the first quarter ended
September 30, 2002 of slightly less than $1.2 million, or basic earnings per
share of $0.42 and diluted earnings per share of $0.41. For the same quarter in
2001, the Company reported earnings of $648 thousand, or both basic and diluted
earnings per share of $0.26.
"We are pleased with the strong performance for the first quarter,"
said Doug Hultquist, President and Chief Executive Officer. "The Company
recognized a significant increase in net interest income of $1.3 million for
this quarter over the same period in 2001. Gains on sales of residential real
estate loans were also a significant contributor to our earnings results for the
quarter as the Company realized an increase in these gains of $251 thousand over
the previous year. In addition, the Company experienced tremendous growth this
quarter of more than $50 million, to end the quarter at $568.8 million in total
assets.
"Continued strong operating results at Quad City Bank & Trust and Quad
City Bancard, Inc. helped fuel these solid first quarter earnings," noted Todd
Gipple, Executive Vice President and Chief Financial Officer. "In addition,
Cedar Rapids Bank & Trust continues to make outstanding progress toward
profitability as it reached its first anniversary as a charter in September
2002. The new charter's after-tax operating losses were only $172 thousand for
the quarter, which continue to run slightly better than anticipated, while asset
growth continues to exceed expectations."
"Cedar Rapids Bank & Trust continues to be a significant contributor to
the Company's growth in assets, loans, and deposits since our opening in
September of 2001. We have experienced rapid growth in our first twelve months
of operations and our charter has reached total assets of $78.2 million, net
loans of $62.6 million, and deposits of $51.8 million as of September 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 at a steady pace, and we are pleased with the market's reaction to
our strategy of providing the highest levels of service and a personalized
banking relationship."
The Company's total assets increased 10% to $568.8 million at September
30, 2002 from $518.8 million at June 30, 2002. During the same period, net loans
increased by $39.2 million or 10% to $423.7 million from $384.5 million at June
30, 2002. Non-performing assets increased to $4.8 million at September 30, 2002
from $3.2 million at September 30, 2001. At September 30, 2002 non-performing
assets were 1.10% of gross loans in comparison to 1.04% of gross loans at
September 30, 2001. Total deposits increased 8% to $405.4 million at September
30, 2002 from $376.3 million at June 30, 2002. Stockholders' equity rose to
$34.5 million at September 30, 2002 as compared to $32.6 million at June 30,
2002.
"The $2,656,000 increase in nonaccrual loans from June 30, 2002 to
September 30, 2002 was primarily due to one commercial lending relationship at
Quad City Bank & Trust," explained Chief Financial Officer Gipple. He added,
"The bank is working closely with this customer in an attempt to remedy the
situation. Like many other financial institutions, some of our customers are
experiencing difficulty in the lagging economy, which could lead to increased
loan loss reserves. Given the continued soft economy, management is closely
monitoring and providing reserves for the Company's loan portfolio."
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On October 22, 2002, the Company issued a press release announcing a
gain of approximately $1.2 million, or $.44 per share, from the sale of a major
portion of the Company's merchant credit card business. This gain will be
recognized by the Company in the second fiscal quarter and does not impact first
quarter earnings results.
Since the Company's formation in February 1993, its fiscal year end has
been June 30th. On August 21, 2002, the Company's Board of Directors approved a
change in the fiscal year end to December 31st. The Company will file a Form
10-K with the Securities and Exchange Commission for the transition period July
1, 2002 through December 31, 2002.
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 subsidiary banks. 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
----------------------------------------
September 30, June 30, September 30,
2002 2002 2001
----------------------------------------
(dollars in thousands,
except share data)
SELECTED BALANCE SHEET DATA
Total assets ......................... $ 568,839 $ 518,828 $ 425,694
Securities ........................... 80,162 76,231 60,800
Total loans .......................... 430,223 390,594 310,266
Allowance for estimated loan losses .. 6,482 6,111 4,630
Total deposits ....................... 405,436 376,317 315,544
Total stockholders' equity ........... 34,476 32,578 30,116
Common shares outstanding ............ 2,749,672 2,749,447 2,740,844
Book value per common share .......... 12.54 11.85 10.99
Full time equivalent employees ....... 194 190 172
Tier 1 leverage capital ratio ........ 7.94% 8.25% 9.39%
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As of
---------------------------------------
September 30, June 30, September 30,
2002 2002 2001
---------------------------------------
(dollars in thousands)
ANALYSIS OF LOAN DATA
Nonaccrual loans ............................... $ 4,216 $ 1,560 $ 2,172
Accruing loans past due 90 days or more ........ 544 708 1,017
Other real estate owned ........................ -- -- 47
Total nonperforming assets ..................... 4,760 2,268 3,236
Net charge-offs ................................ $ 266 $ 402 $ 27
(For the quarter ended / fiscal year ended)
Loan mix:
Commercial ................................... $325,030 $305,043 $228,204
Real estate .................................. 60,414 45,418 43,649
Installment and other consumer ............... 44,779 40,133 38,413
Total loans .................................... 430,223 390,594 310,266
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For the Quarter Ended
September 30,
-----------------------
2002 2001
-----------------------
(dollars in thousands, except per share data)
SELECTED INCOME STATEMENT DATA
Interest income .................................... $ 7,876 $ 6,950
Interest expense ................................... 3,189 3,520
Net interest income ................................ 4,687 3,430
Provision for loan losses .......................... 637 409
Noninterest income ................................. 2,469 1,848
Noninterest expense ................................ 4,771 3,926
Income tax expense ................................. 589 295
Net income ......................................... 1,159 648
Earnings per common share (basic) .................. $ 0.42 $ 0.26
Earnings per common share (diluted) ................ $ 0.41 $ 0.26
AVERAGE BALANCES
Assets ............................................. $544,944 $414,526
Deposits ........................................... 384,786 309,240
Loans .............................................. 399,819 299,879
Stockholders' equity ............................... 33,548 25,618
KEY RATIOS
Return on average assets (annualized) .............. 0.85% 0.63%
Return on average common equity (annualized) ....... 13.82% 10.12%
Net interest margin (TEY) .......................... 3.75% 3.64%
Efficiency ratio ................................... 66.60% 74.35%
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For the Quarter Ended
September 30,
-----------------------
2002 2001
-----------------------
(dollars in thousands, except share data)
ANALYSIS OF NONINTEREST INCOME
Merchant credit card fees, net of processing costs ... $ 688 $ 520
Trust department fees ................................ 514 477
Deposit service fees ................................. 284 238
Gain on sales of loans, net .......................... 713 462
Other ................................................ 270 151
Total noninterest income .......................... 2,469 1,848
ANALYSIS OF NONINTEREST EXPENSE
Salaries and employee benefits ....................... $ 2,866 $ 2,290
Professional and data processing fees ................ 396 373
Advertising and marketing ............................ 140 112
Occupancy and equipment expense ...................... 702 530
Stationery and supplies .............................. 117 105
Postage and telephone ................................ 145 109
Other ................................................ 405 407
Total noninterest expenses ........................ 4,771 3,926
WEIGHTED AVERAGE SHARES
Common shares outstanding (a) ........................ 2,749,562 2,454,757
Incremental shares from assumed conversion:
Options .......................................... 64,624 46,408
Adjusted weighted average shares (b) ................. 2,814,186 2,501,165
(a) Denominator for Basic Earnings Per Share
(b) Denominator for Diluted Earnings Per Share
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