For Immediate Release For more information, contact:
Date: October 23, 1998 Lane Ward, Vice Chairman, President and CEO
at (281) 342-5571
FORT BEND HOLDING CORP.'S
SECOND QUARTER FISCAL 1999 EARNINGS RELEASE
Fort Bend Holding Corp. ("FBHC"), parent corporation of Fort Bend
Federal Savings and Loan Association of Rosenberg ("FBF"), today announced net
earnings of $532,000, or $0.29 earnings per common share, for the second fiscal
quarter ended September 30, 1998. This compares to net earnings of $503,000, or
$0.30 earnings per common share, for the same quarter in fiscal 1998 and
represents a 5.8% increase in earnings. Net income for the six months ended
September 30, 1998 was $1,104,000, or $0.62 earnings per common share. This
compares to net earnings of $1,022,000, or $0.62 earnings per common share, for
the six months ended September 30, 1997. Earnings per common share--assuming
dilution for the six months ended September 30, 1998 and 1997 was $0.48.
FBHC's net interest income after provision for loan losses was $2.6
million for the quarter ended September 30, 1998 compared to $2.4 million for
the quarter ended September 30, 1997. Net interest income reflected an increase
in average interest-earning assets to $303 million from $292 million for the
quarters ended September 30, 1998 and 1997, respectively. An increase of $30
million in the average balance of loans receivable and $2 million in
investments, partially offset by a decrease of $21 million in mortgage-backed
securities, contributed to the increase in average interest-earnings assets. The
increase in the average loan balances reflected an increase of $24 million from
the loan portfolio of FBF's subsidiary Mitchell Mortgage Company, L.L.C.
("Mitchell").
Total noninterest income increased by $570,000 for the quarter ended
September 30, 1998 compared to the same period in fiscal 1998. This increase was
primarily due to an increase in the gain on sales of loans of $352,000 which
primarily reflected an increase in loans sold during the period. The principal
balance of loans sold during the three months ended September 30, 1998 was $28.5
million compared to $17.3 million for the same period in fiscal 1998. Loan fees
and charges increased $255,000 which primarily reflected increased commercial,
multifamily, and construction lending. FBHC originated $66 million of commercial
and multifamily loans and $34 million of construction loans during the three
months ended September 30, 1998 compared to $18 million of commercial and
multifamily loans and $28 million of construction loans during the same period
in fiscal 1998.
Partially offsetting the increase in earnings from the above sources has
been an increase in noninterest expense of $559,000. The increase reflects an
increase in compensation and benefits of $379,000. The increased compensation
and benefits is due to increases in commissions resulting from the higher loan
volume in the current year, normal salary adjustments, and overtime. Other
expense increased $115,000 during the three months ended September 30, 1998 when
compared to the same period in fiscal 1998. The increase was primarily due to an
increase of $69,000 in loan origination and service charges, such as appraisals,
flood data services, and credit reports, associated with the higher loan volume
in the current year.
On October 20, 1998, FBHC signed a definitive agreement to merge with
Southwest Bancorporation of Texas, Inc. ("SWBT"). The transaction is structured
as a tax-free reorganization with a fixed exchange of 1.45 shares of SWBT common
stock for each share of FBHC common stock and convertible equivalents. At SWBT's
closing stock price of $15.00 on October 20, 1998, the transaction would be
valued at approximately $65 million, and FBHC shareholders would receive a value
of $21.75 for each share of FBHC common stock.
FBHC serves Fort Bend, Harris, Wharton, Waller and Montgomery Counties
in Southeast Texas through its subsidiary, FBF headquartered in Fort Bend County
and FBF's subsidiary Mitchell located in The Woodlands. FBF's market area is
located in the largest metropolitan area of Texas and the eighth largest in the
United States. The Corporation's stock is traded on the Nasdaq National Market
under the symbol "FBHC".
This press release includes forward-looking statements that are subject
to risks and uncertainties. Actual results might differ materially from those
projected in the forward-looking statements. Additional information concerning
factors that could cause actual results to materially differ from those in the
forward-looking statements is contained in the Securities and Exchange
Commission filings of FBHC.
FORT BEND HOLDING CORP.
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
ASSETS SEPTEMBER 30, 1998 MARCH 31, 1998
Cash and due from banks $ 7,399 $ 6,260
Short-term investments 47,126 20,484
Certificates of deposit 400 300
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TOTAL CASH AND CASH EQUIVALENTS 54,925 27,044
Investment securities available for sale, at market 3,023 2,962
Investment securities held to maturity (estimated market value of
$6,025 and $8,984 at September 30, 1998 and March 31, 1998, respectively) 6,247 9,244
Mortgage-backed securities available for sale, at market 224 282
Mortgage-backed securities held to maturity (estimated market
value of $69,177 and $83,222 at September 30, 1998
and March 31, 1998, respectively) 68,673 82,815
Loans held for sale 10,104 12,920
Loans receivable, net 165,710 160,062
Premises and equipment, net 4,666 4,738
Mortgage servicing rights, net 7,367 7,603
Prepaid expenses and other assets 5,347 7,680
Goodwill, net 1,209 1,256
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TOTAL ASSETS $ 327,495 $ 316,606
=============== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits $ 275,695 $ 268,991
Convertible subordinated debentures 9,910 11,405
Borrowings 4,457 3,985
Advances from borrowers for taxes and insurance 7,828 4,619
Accounts payable, accrued expenses and other liabilities 3,336 3,646
--------------- ------------
TOTAL LIABILITIES 301,226 292,646
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Minority interest in consolidated subsidiary 2,673 2,556
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Stockholders' equity:
Serial preferred stock, $.01 par value - 1,000,000 shares authorized,
none outstanding
Common Stock $.01 par value, 4,000,000 shares authorized,
2,042,652 shares issued and 1,866,304 shares outstanding at
September 30, 1998 and 1,899,654 shares issued and 1,723,306
shares outstanding at March 31, 1998 20 19
Additional paid-in capital 11,427 9,927
Unearned employee stock ownership plan shares (118) (118)
Deferred compensation (136) (83)
Net unrealized appreciation (depreciation) on available for
sale securities 5 7
Retained earnings (substantially restricted) 13,854 13,108
Treasury stock, at cost - 176,348 shares (1,456) (1,456)
--------------- ------------
TOTAL STOCKHOLDERS' EQUITY 23,596 21,404
--------------- ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 327,495 $ 316,606
=============== ============
FORT BEND HOLDING CORP.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1998 1997 1998 1997
INTEREST INCOME:
Loans $3,839 $3,367 $7,639 $6,731
Short-term investments 531 436 915 595
Investment securities 151 215 330 457
Mortgage-backed securities 1,163 1,524 2,448 3,099
------ ------ ------ ------
Total interest income 5,684 5,542 11,332 10,882
------ ------ ------ ------
INTEREST EXPENSE:
Deposits 2,787 2,787 5,552 5,455
Borrowings 291 324 564 661
------ ------ ------ ------
TOTAL INTEREST EXPENSE 3,078 3,111 6,116 6,116
------ ------ ------ ------
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 2,606 2,431 5,216 4,766
PROVISION FOR LOAN LOSSES 45 15 90 78
------ ------ ------ ------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 2,561 2,416 5,126 4,688
------ ------ ------ ------
NONINTEREST INCOME:
Loan fees and charges 1,009 754 2,084 1,481
Loan servicing income, net 199 275 405 573
Service charges on deposit accounts 227 220 451 430
Gain on sales of loans 508 156 805 253
Other income 160 128 367 316
------ ------ ------ ------
TOTAL NONINTEREST INCOME 2,103 1,533 4,112 3,053
------ ------ ------ ------
NONINTEREST EXPENSES:
Compensation and benefits 2,009 1,630 4,007 3,224
Employee stock ownership plan expense 140 173 143 328
Office occupancy and equipment 498 436 986 883
Federal insurance premiums 43 40 86 80
Data processing fees 164 131 337 257
Other expense 782 667 1,620 1,220
------ ------ ------ ------
TOTAL NONINTEREST EXPENSES 3,636 3,077 7,179 5,992
------ ------ ------ ------
INCOME BEFORE INCOME TAX EXPENSE AND MINORITY INTEREST 1,028 872 2,059 1,749
INCOME TAX EXPENSE 331 269 667 547
------ ------ ------ ------
INCOME BEFORE MINORITY INTEREST 697 603 1,392 1,202
MINORITY INTEREST IN NET INCOME OF SUBSIDIARY 165 100 288 180
------ ------ ------ ------
NET INCOME $532 $503 $1,104 $1,022
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EARNINGS PER COMMON SHARE $0.29 $0.30 $0.62 $0.62
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EARNINGS PER COMMON SHARE - ASSUMING DILUTION $0.23 $0.24 $0.48 $0.48
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DIVIDENDS PER COMMON SHARE $0.10 $0.05 $0.20 $0.085
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