EXHIBIT 99.1
PRESS RELEASE
================================================================================
FOR IMMEDIATE RELEASE October 14, 1998
For information contact:
R. Randy Guemple
Chief Operating Officer
(561) 650-2425
FIRST PALM BEACH BANCORP, INC.
ANNOUNCES ANNUAL & QUARTERLY EARNINGS
WEST PALM BEACH, FLORIDA, October 14, 1998 . . . First Palm Beach Bancorp,
Inc. (the "Company") (NASDAQ:FFPB), the holding company for Florida-based First
Bank of Florida (the "Bank"), which on May 28, 1998 announced the execution of a
definitive agreement to be merged into Republic Security Financial Corporation,
today reported net income of $5.6 million or $1.12 per share (basic) for the
year ended September 30, 1998, compared to $9.4 million or $1.91 per share
(basic) for the year ended September 30, 1997. The Company also reported net
income of $18,000 (no earnings per share) for the quarter ended September 30,
1998 as compared to $2.5 million or $0.50 per share (basic) for the quarter
ended September 30, 1997. For the year and the quarter ended September 30, 1998
net income per share was calculated in accordance with the provisions of
Statement of Financial Accounting Standards No. 128, "Earnings Per Share," with
the previous periods restated.
Net interest income before loan loss provision for the year ended September
30, 1998 was $41.2 million as compared to $44.1 million for the year ended
September 30, 1997. The net interest margin for the year ended September 30,
1998 was 2.40% as compared to 2.91% for the year ended September 30, 1997. The
decrease in the net interest margin is a result of the declining interest rate
environment which has led to increased refinancing activity without a relative
corresponding decrease in the Bank's cost of funds. The net interest income
before loan loss provision for the quarter ended September 30, 1998 was $9.5
million as compared to $11.0 million for the quarter ended September 30, 1997.
Other income for the year ended September 30, 1998 increased $4.0 million
to $13.0 million from $9.0 million for the year ended September 30, 1997. This
increase is primarily due to gains on the sale of loans of $2.4 million and
gains on the sale of securities of $2.9 million during the year ended September
30, 1998, as compared to a $1.5 million gain on the sale of securities in the
year ended September 30, 1997. Other income for the quarter ended September 30,
1998 was $1.9 million as compared to $3.0 million for the quarter ended
September 30, 1997. Other income for the quarter ended September 30, 1997
included one time gains on the sale of Bank property and stock of $1.0 million.
For the year ended September 30, 1998, other expenses increased to $40.3
million as compared to $34.4 million for the year ended September 30, 1997.
Other expenses increased to $10.9 million for the quarter ended September 30,
1998 from $9.1 million for the quarter ended September 30, 1997. The increases
in other expenses for both the year and the quarter are primarily the result of
increased expenses related to employee compensation and benefits. Compensation
expenses increased by $4.2 million and $1.3 million for the year and quarter
ended September 30, 1998, respectively, as compared to the same periods last
year. Compensation for both periods increased primarily due to the growth of the
Bank's branch network as the number of branches increased by 61% between
September 30, 1996 and September 30, 1998 from 33 to 53 full service branch
locations. Additionally during the past year the Bank added a commercial loan
department and strengthened the credit review department. Compensation and
benefits also includes expenses related to the Bank's ESOP. ESOP-related
expenses increased during both the year and the quarter ended September 30, 1998
due to an approximately 39% increase in the market value of the Company's stock
over the
5
past year. The Company expects to incur no further compensation costs associated
with ESOP-related expenses following completion of the repayment of the
ESOP-related loan in the quarter ending December 31, 1998.
Stockholders' equity increased by $15.0 million from $113.0 million at
September 30, 1997 to $128.0 million at September 30, 1998. Increases to
stockholders' equity during the year include net income of $5.6 million and an
increase in the unrealized gain on securities available for sale (net of
applicable income taxes) of $7.0 million. Tangible book value per share
increased to $24.24 as of September 30, 1998 from $21.87 at September 30, 1997.
On May 28th the Company announced the execution of a definitive agreement
to be merged into Republic Security Financial Corporation (NASDAQ: RSFC) the
parent company of Republic Security Bank. Republic Security Financial
Corporation, with total assets of $1.1 billion, operates 35 full service banking
offices and is headquartered in Palm Beach County, Florida. The merger has
received all necessary regulatory approvals and, subject to the receipt of
stockholder approval, is expected to close during October 1998.
First Palm Beach Bancorp, Inc. is the parent of First Bank of Florida, and
is the largest locally based savings institution in Palm Beach County, Florida.
With assets of approximately $1.8 billion, First Palm Beach Bancorp, Inc. serves
the communities of Palm Beach, Martin, Broward, Dade and Lee Counties through
the Bank's 53 full-service branches and three loan production offices. The stock
of First Palm Beach Bancorp, Inc. is listed on NASDAQ under the symbol FFPB.
This release may contain certain forward-looking statements, which are
based on management's current expectations regarding economic, legislative, and
regulatory issues that may impact the Bank's (or, in light of the pending
merger, the Bank's successor's) earnings in future periods. Factors that could
cause future results to vary materially from current management expectations
include, but are not limited to, general economic conditions, changes in
interest rates, deposit flows, loan demand, real estate values, and competition;
changes in accounting principles, policies, or guidelines; changes in
legislation or regulation; and other economic, competitive, governmental,
regulatory, and technological factors affecting the Company's operations,
pricing, products, and services.
# # # #
(Financial Information Follows -- Please note that all information is unaudited
and could be subject to change.)
6
(UNAUDITED)
9/30/98 9/30/97
--------------------- --------------------
(In thousands, except share data)
Selected Financial Data:
Total assets $ 1,809,202 $ 1,808,423
Loans receivable, net 1,089,179 1,144,100
Cash and cash equivalents 41,613 99,929
Securities available-for-sale and held-to-maturity 83,597 74,456
Mortgage-backed and related securities available-for-sale and held-to-maturity 528,614 421,645
Real estate owned 3,425 1,795
Repossessed automobiles 256 474
Goodwill 2,437 2,631
Deposits 1,307,599 1,229,279
Borrowed funds 295,825 394,871
Senior Debentures, net 33,998 33,839
Stockholders' equity 128,020 113,030
Common shares outstanding 5,181,509 5,047,746
Book value per share $ 24.71 $ 22.39
Book value per share - tangible $ 24.24 $ 21.87
Non-performing assets $ 7,683 $ 10,355
Quarter Ended Twelve Months
September 30 Ended September 30
----------------------------- -----------------------------
1998 1997 1998 1997
------------ ------------ ------------ ------------
(In thousands)
Selected Operating Data:
Interest income $ 30,259 $ 31,993 $ 126,017 $ 116,930
Interest expense 20,782 21,010 84,850 72,851
------------ ------------ ------------ ------------
Net interest income 9,477 10,983 41,167 44,079
Less provision for loan losses 48 1,081 4,110 3,281
------------ ------------ ------------ ------------
Net interest income after provision for loan losses 9,429 9,902 37,057 40,798
------------ ------------ ------------ ------------
Other income:
Servicing income and other fees 1,177 1,109 4,484 4,106
Net gain on sale of securities available-for-sale, mortgage- -- 254 5,296 1,896
backed and related securities available-for-sale and loans
Miscellaneous 753 1,645 3,234 2,999
------------ ------------ ------------ ------------
Total other income 1,930 3,008 13,014 9,001
------------ ------------ ------------ ------------
Other expenses:
Employee compensation and benefits 6,258 4,976 22,747 18,511
Occupancy and equipment 2,039 1,933 7,568 6,729
Federal deposit insurance premiums 294 192 1,068 977
Provision for losses and net losses on sale of real estate owned 296 63 524 329
Advertising and promotion 257 144 1,394 1,005
Miscellaneous 1,707 1,747 7,011 6,855
------------ ------------ ------------ ------------
Total other expenses 10,851 9,055 40,312 34,406
------------ ------------ ------------ ------------
Income before provision for income taxes 508 3,855 9,759 15,393
Provision for income taxes 490 1,400 4,178 6,037
------------ ------------ ------------ ------------
Net income $ 18 $ 2,455 $ 5,581 $ 9,356
============ ============ ============ ============
Earnings per share:
Basic $ 0.00 $ 0.50 $ 1.12 $ 1.91
Diluted $ 0.00 $ 0.48 $ 1.09 $ 1.86
7