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FIRST CAPITAL, INC. REPORTS 20% FIRST QUARTER EARNINGS INCREASE
Corydon, Indiana--(BUSINESS WIRE)--April 25, 2008. First Capital, Inc. (NASDAQ:
FCAP - news), the holding company for First Harrison Bank (the "Bank"), today
reported net income of $899,000 or $0.32 per diluted share for the quarter ended
March 31, 2008, compared to $749,000 or $0.26 per diluted share for the quarter
ended March 31, 2007.
The increase in earnings is due to increases in net interest income after
provision for loan losses and noninterest income, partially offset by an
increase in noninterest expense.
Net interest income after provision for loan losses increased $218,000 for the
quarter ended March 31, 2008 as compared to the same prior year period. Interest
income decreased $110,000 when comparing the periods as the average
tax-equivalent yield of interest-earning assets decreased from 6.48% in the
three-month period ended March 31, 2007 to 6.37% during the same period in 2008.
Interest expense decreased $328,000 when comparing the periods as the average
cost of interest-bearing liabilities decreased from 3.74% to 3.35%. The
provision for loan losses remained unchanged at $225,000 for both periods in the
comparison.
Noninterest income increased $64,000 for the three months ended March 31, 2008
as compared to the same period in 2007. Service charges on deposit accounts and
the earnings from bank-owned life insurance increased $64,000 and $45,000,
respectively, when comparing the two periods. The increase in cash surrender
value of bank-owned life insurance was due to the purchase of $3.6 million of
bank-owned life insurance in May 2007.
Noninterest expenses increased $80,000 during the three months ended March 31,
2008 as compared to the three months ended March 31, 2007. Occupancy expenses
and professional services increased $49,000 and $30,000 when comparing the two
periods. The increase in occupancy expense can be partially attributed to the
opening of a new office in Salem, Indiana, in November 2007.
Total assets as of March 31, 2008 were $455.6 million compared to $453.2 million
at December 31, 2007. The primary factors behind the increase in assets were a
$10.1 million increase in cash and cash equivalents, partially offset by a
decrease of $7.5 million in gross loans receivable. Cash and cash equivalents
also increased due to growth in deposits and retail repurchase agreements of
$3.9 million and $1.7 million, respectively. Nonperforming assets decreased from
$6.5 million at December 31, 2007 to $6.4 million at March 31, 2008.
First Harrison Bank currently has twelve offices in the Indiana communities of
Corydon, Edwardsville, Greenville, Floyds Knobs, Hardinsburg, Palmyra, New
Albany, New Salisbury, Jeffersonville and Salem. The Bank also has received
regulatory approval to relocate its Edwardsville office within that town.
Construction began on the new office in the first quarter of 2008. Access to
First Harrison Bank accounts, including online banking and electronic bill
payments, is available anywhere with Internet access through the Bank's website
at www.firstharrison.com. First Harrison Financial Services, a division of the
Bank, offers non-FDIC insured investments to compliment the Bank's offering of
traditional banking products and services.
This release may contain forward-looking statements within the meaning of the
federal securities laws. These statements are not historical facts; rather, they
are statements based on the Company's current expectations regarding its
business strategies and their intended results and its future performance.
Forward-looking statements are preceded by terms such as "expects," "believes,"
"anticipates," "intends" and similar expressions.
Forward-looking statements are not guarantees of future performance. Numerous
risks and uncertainties could cause or contribute to the Company's actual
results, performance and achievements to be materially different from those
expressed or implied by the forward-looking statements. Factors that may cause
or contribute to these differences include, without limitation, general economic
conditions, including changes in market interest rates and changes in monetary
and fiscal policies of the federal government; legislative and regulatory
changes; and other factors disclosed periodically in the Company's filings with
the Securities and Exchange Commission.
Because of the risks and uncertainties inherent in forward-looking statements,
readers are cautioned not to place undue reliance on them, whether included in
this report or made elsewhere from time to time by the Company or on its behalf.
Except as may be required by applicable law or regulation, the Company assumes
no obligation to update any forward-looking statements.
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FIRST CAPITAL, INC. AND SUBSIDIARY
Consolidated Financial Highlights (Unaudited)
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THREE MONTHS ENDED
MARCH 31,
OPERATING DATA 2008 2007
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(Dollars in thousands, except per share data)
Total interest income $ 6,654 $ 6,764
Total interest expense 3,117 3,445
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Net interest income 3,537 3,319
Provision for loan losses 225 225
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Net interest income after provision for
loan losses 3,312 3,094
Total non-interest income 878 814
Total non-interest expense 2,882 2,802
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Income before income taxes 1,308 1,106
Income tax expense 409 357
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Net income $ 899 $ 749
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Net income per common share, basic 0.32 0.27
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Weighted average common shares
outstanding basic 2,807,152 2,823,487
Net income per common share, diluted $ 0.32 $ 0.26
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Weighted average common shares
outstanding - diluted 2,824,456 2,848,301
OTHER FINANCIAL DATA
Cash dividends per share $ 0.17 $ 0.17
Return on average assets (annualized) 0.79% 0.67%
Return on average equity (annualized) 7.76% 6.75%
Net interest margin 3.44% 3.23%
Net overhead expense as a percentage
of average assets (annualized) 2.52% 2.50%
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<Table>
<Caption>
MARCH 31, DECEMBER 31,
BALANCE SHEET INFORMATION 2008 2007
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(Dollars in thousands)
Cash and cash equivalents $ 25,117 $ 15,055
Investment securities 72,630 74,041
Gross loans receivable 329,207 336,695
Allowance for loan losses 2,275 2,232
Earning assets 420,469 417,358
Total assets 455,630 453,179
Deposits 332,041 328,151
FHLB debt 56,644 60,694
Repurchase agreements 17,245 15,562
Stockholders' equity 46,755 45,736
Non-performing assets:
Nonaccrual loans 4,390 4,879
Accruing loans past due 90 days 914 795
Foreclosed real estate 1,125 833
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