EXHIBIT 99.1
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NEWS FOR IMMEDIATE RELEASE CONTACT: BRIEN M. CHASE, CFO
MAY 6, 2004 (304) 525-1600
PREMIER FINANCIAL BANCORP, INC.
REPORTS FIRST QUARTER 2004 EARNINGS
PREMIER FINANCIAL BANCORP, INC. (PREMIER), HUNTINGTON, WEST VIRGINIA
(NASDAQ/NMS-PFBI), a $633 million community bank holding company with seven bank
subsidiaries announced positive earnings results for the first quarter of 2004.
Premier realized net income of $511,000 (10 cents per share) during the quarter
ending March 31, 2004, $482,000 from continuing operations and $29,000 from
discontinued operations. [The discontinued operation is Premier's wholly-owned
subsidiary Citizens Bank (Kentucky), Inc. ("Citizens Bank") which is under a
definitive agreement to sell. The following discussion relates only to
continuing operations.] The $482,000 of income from continuing operations in the
first quarter of 2004 compares to a $365,000 (7 cents per share) net loss
reported for the first quarter of 2003 and a $596,000 (11 cents per share) net
loss reported for the fourth quarter of 2003.
Net interest income for the quarter ending March 31, 2004 totaled $4.446
million, compared to $5.101 million of net interest income earned in the first
quarter of 2003 and $4.480 million earned in the fourth quarter of 2003. When
compared to the fourth quarter of 2003, net interest income has remained
relatively stable from quarter to quarter as declines in loan interest income
have been substantially offset by declines in interest expense on deposits. The
decline in 2004 net interest income when compared to the first quarter of 2003
is the result of lower loans outstanding and the significant volume ($10.7
million) of loans on non-accrual at Premier's subsidiary Farmers Deposit Bank.
During the quarter ending March 31, 2004, Premier made provisions to the
allowance for loan losses of $135,000 compared to $2,267,000 during the same
period of 2003 and $2,125,000 in the fourth quarter of 2003. The significant
provisions in the prior periods were primarily the result of loan problems
identified at Farmers Deposit Bank after the former president of the bank
resigned. The decrease in the provision in 2004 was the result of identifying
little additional risk of probable losses in the loan portfolio. As a result,
the allowance for loan losses at March 31, 2004 was 4.19% of total loans
compared to 4.31% of total loans at year-end 2003 and 2.67% of total loans at
March 31, 2003.
President and CEO, Robert W. Walker commented, "We are constantly working to
improve our operations and thus increase the `bottom line'. In August 2003, we
employed a senior credit analyst at the holding company to review and make
recommendations on large loans during the approval process. These loans are then
approved or rejected by a committee made up of affiliate bank CEO's, myself and
the Director of Risk Management. We feel these steps have significantly improved
our credit underwriting. In April 2004, we hired an internal auditor at the
holding company to enhance the internal audit function. We believe this will
help us identify and resolve any potential operational issues more quickly and
efficiently than ever before. Finally we hope to close the sale of our Citizens
Bank (Kentucky) affiliate early in the third quarter. We hope the anticipated
increase in liquidity and profit from the sale will help strengthen the
financial position of the company. "
Net overhead for the quarter ending March 31, 2004 totaled $3.626 million. This
compares to $3.628 million in the first quarter of 2003 (which included $124,000
of expenses related to the early redemption of $3.0 million of Premier Trust
Preferred Securities (NASDAQ/NMS-PFBIP)), and $3.717 million in the prior
calendar quarter. When compared to the first quarter of 2003, increased
professional fee expense in 2004 was partially offset by lower staff costs and
occupancy expense plus an increase in non-interest income, primarily service
charges on deposit accounts. When compared to the prior calendar quarter (4th
Qtr 2003), higher staff costs in 2004 were more than offset by lower OREO
writedowns. General declines in other types of non-interest expense were only
partially offset by lower non-interest income, primarily service charges on
deposit accounts.
Total assets from continuing operations as of March 31, 2004 of $553 million
were 1.8% greater than the $543 million of total assets of continuing operations
at year-end, largely due to $6.0 million of investment purchases late in March
that did not settle until April. Shareholders' equity of $46.5 million equaled
7.3% of total assets at March 31, 2004 and 8.4% of total assets of continuing
operations. This compares to shareholders' equity of $45.5 million or 7.3% of
total assets at December 31, 2003.
Certain Statements contained in this news release, including without limitation
statements including the word "believes," "anticipates," "intends," "expects" or
words of similar import, constitute "forward-looking statements" within the
meaning of section 21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Such forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause the actual results,
performance or achievements of Premier to be materially different from any
future results, performance or achievements of Premier expressed or implied by
such forward-looking statements. Such factors include, among others, general
economic and business conditions, changes in business strategy or development
plans and other factors referenced in this press release. Given these
uncertainties, prospective investors are cautioned not to place undue reliance
on such forward-looking statements. Premier disclaims any obligation to update
any such factors or to publicly announce the results of any revisions to any of
the forward-looking statements contained herein to reflect future events or
developments.
Following is a summary of the financial highlights for Premier as of and for the
period ending March 31, 2004.
PREMIER FINANCIAL BANCORP, INC.
Financial Highlights
Dollars in Thousands (except per share data)
For the Quarter Ended
March 31 March 31
2004 2003
(Restated)
Interest Income 7,055 8,606
Interest Expense 2,609 3,505
Net Interest Income 4,446 5,101
Provision for Loan Losses 135 2,267
Net Interest Income after Provision 4,311 2,834
Non-Interest Income 846 724
Securities Transactions 10 189
Non-Interest Expenses 4,472 4,352
Income (Loss) from Continuing
Operations Before Taxes 695 (605)
Income Taxes (Benefit) 213 (240)
Income (Loss) from
Continuing Operations 482 (365)
Income (Loss) from
Discontinued Operations 29 (27)
NET INCOME (LOSS) 511 (392)
EARNINGS (LOSS) PER SHARE 0.10 (0.07)
FROM CONTINUING OPERATIONS 0.09 (0.07)
PREMIER FINANCIAL BANCORP, INC.
Financial Highlights (continued)
Dollars in Thousands (except per share data)
Balances as of
March 31 December 31
2004 2003
ASSETS
Cash/Due From Banks/Fed Funds 48,687 33,473
Securities Available for Sale 145,690 147,646
Loans (net) 314,429 317,494
Other Real Estate Owned 3,661 3,187
Other Assets 24,702 25,613
Goodwill 15,816 15,816
Assets of Discontinued Operation 80,630 79,163
TOTAL ASSETS 633,615 622,392
LIABILITIES
Deposits 450,322 455,474
Fed Funds/Repurchase Agreements 6,000 0
Other Debt 19,220 18,307
Junior Subordinated Debentures 26,546 26,546
Other Liabilities 12,276 5,129
Liabilities of Discontinued Operations 72,797 71,396
TOTAL LIABILITIES 587,161 576,852
Stockholders' Equity 46,454 45,540
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY 633,615 622,392
TOTAL BOOK VALUE PER SHARE 8.88 8.70
Non-Accrual Loans 14,775 11,958
Loans 90 Days Past Due and Still Accruing 1,240 4,137