Exhibit 99.1
CONTACTS: Mary K. Talbot
(401) 245-8819
SLADE'S FERRY BANCORP REPORTS EARNINGS
SOMERSET, Mass. (October 19, 2005) -- Slade's Ferry Bancorp (the
"Company"), (NASDAQ Small Cap: SFBC) parent company of Slade's Ferry Trust
Company (the "Bank"), announced that its net income for the quarter ended
September 30, 2005 was $900,000 or $0.22 per share (diluted), a decrease of
16.4% over net income for the quarter ended September 30, 2004, which
totaled $1.08 million or $0.26 per share (diluted). For the nine months
ended September 30, 2005, net income was $2.85 million or $0.69 per share
(diluted), an increase of 24.5% over net income for the nine months ended
September 30, 2004, which totaled $2.29 million or $0.56 per share
(diluted).
Net income was adversely affected by the recognition, in the third quarter
of 2005, of settlement costs related to the Bank's defined benefit pension
plan totaling $166,000. The effect, after income taxes, was to reduce net
income for the three and nine months ended September 30, 2005 by $98,000 or
$0.02 per share (diluted).
"Our employees and board of directors have set and achieved some ambitious
goals for this year. The progress we've made this year is a tribute to
their efforts," said President and CEO Mary Lynn D. Lenz.
Net interest and dividend income increased from $4.23 million for the three
months ended September 30, 2004, to $4.48 million for the three months
ended September 30, 2005, an increase of 6.1%. For the nine months ended
September 30, 2005, net interest income was $13.36 million, compared to
$11.72 million for the nine months ended September 30, 2004, an increase of
13.9%. For the three months ended September 30, 2005 the net interest
margin was 3.28%, a decrease from 3.46% for the three months ended
September 30, 2004. The decrease in the interest margin reflects the
intense competition for deposits in the Bank's market area and the
increases in deposit interest rates deemed necessary in order to remain
competitive. The net interest margin increased from 3.36% for the nine
months ended September 30, 2004 to 3.37% for the nine months ended
September 30, 2005.
The Company recorded a provision for loan losses totaling $44,000 for the
three months ended September 30, 2005. There was no provision for loan
losses recorded for the three months ended September 30, 2004. For the nine
months ended September 30, 2005, the provision for loan losses totaled
$109,000, compared to $376,000 for the nine months ended September 30,
2004. As a result of stronger underwriting guidelines and the sale in the
third quarter of 2004, of loans previously deemed non-performing, the
overall credit risk profile of the loan portfolio has improved, allowing a
lesser provision for loan losses during 2005.
Non-interest income decreased from $813,000 for the three months ended
September 30, 2004 to $602,000 for the three months ended September 30,
2005. Non-interest income decreased from $1.98 million for the nine months
ended September 30 2004, to $1.71 million for the nine months ended
September 30, 2005. The decreases are predominately the result of
decreased gains on sales of loans. These sales consisted
entirely of sales of non-performing or charged-off loans, totaling $50,000
for the three and nine months ended September 30, 2005, as compared to
$196,000 for the three and nine months ended September 30, 2004. Also
contributing to the decrease in non interest income is shifting customer
preferences toward "free" checking products and associated services
reducing deposit service fees from fee-based products.
Total operating expenses increased from $3.46 million for the three months
ended September 30, 2004 to $3.68 million for the three months ended
September 30, 2005, an increase of 6.4%. For the nine months ended
September 30, 2005, operating expenses totaled $10.62 million, compared to
$9.89 million for the nine months ended September 30, 2004, an increase of
7.3%. Other than the settlement costs mentioned above, which totaled
$166,000, increases can be attributed to equipment expenses resulting from
the implementation of retail banking platform automation software in the
fourth quarter of 2004, and the increases in general price levels due to
inflation.
Total assets increased from $549.4 million at December 31, 2004 to $580.8
million at September 30, 2005, an increase of 5.7%. Total net loans
increased from $362.3 million to $395.7 million, while total deposits
increased from $399.9 million to $405.3 million during the same period.
Total stockholders' equity at September 30, 2005 was $48.5 million versus
$46.6 million at December 31, 2004, an increase of 4.0%. Both the Company
and the Bank maintain capital levels sufficient to be considered "well-
capitalized" under applicable regulatory capital guidelines and
requirements.
The Company declared a $0.09 dividend to common shareholders of record on
September 23, 2005, which was paid on October 14, 2005.
Slade's Ferry Bancorp was founded to serve community-banking needs with
both personal and commercial products and services. With more than $580
million in assets and nine retail branches in Southeastern Massachusetts,
Slade's Ferry is a trusted community partner. Traded on the NASDAQ Small
Cap Market as SFBC, Slade's Ferry Bancorp can also be found on the web at
www.sladesferry.com and in seven Massachusetts communities - Assonet,
Fairhaven, Fall River, New Bedford, Seekonk, Somerset and Swansea.
# # #
This news release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995, including statements
regarding the strength of the company's capital and asset quality. Other
such statements may be identified by words such as "believes," "will,"
"expects," "project," "may," "developments," "strategic," "launching,"
"opportunities," "anticipates," "estimates," "intends," "plans," "targets"
and similar expressions. These statements are based upon the current
beliefs and expectations of Slade's Ferry Bancorp's management and are
subject to significant risks and uncertainties. Actual results may differ
materially from those set forth in the forward-looking statements as a
result of numerous factors.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectation expressed in
our forward-looking statements: (1) enactment of adverse government
regulations (2) competitive pressures among depository and other financial
institutions may increase significantly and have an effect on pricing,
spending, third-party relationships and revenues; (3) the strength of the
United States economy in general and specifically the strength of the New
England economics may be different than expected, resulting in, among other
things, a deterioration in overall credit quality and borrowers' ability to
service and repay loans, or a reduced demand for credit, including the
resultant effect on the Bank's loan portfolio, levels of charge-offs and
non-performing loans and allowance for loan losses; (4) changes in the
interest rate environment may reduce interest margins and adversely impact
net interest income and (5) changes in assumptions used in making such
forward-looking statements. Should one or more of these risks materialize
or should underlying beliefs or assumptions prove incorrect, Slade's Ferry
Bancorp's actual results could differ materially from those discussed. All
subsequent written and oral forward-looking statements attributable to
Slade's Ferry Bancorp or any person acting on its behalf are expressly
qualified in their entirety by the cautionary statements set forth above.
Slade's Ferry Bancorp does not intend or undertake any obligation to update
any forward-looking statement to reflect circumstances or events that occur
after the date of the forward-looking statements are made.
SLADE'S FERRY BANCORP AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
AS OF
SEPTEMBER 30, DECEMBER 31,
(Dollars in Thousands) 2005 2004
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ASSETS:
Cash and deposits with other banks $ 21,147 $ 16,394
Federal Home Loan Bank overnight deposit - 5,000
Federal funds sold - 13,800
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Cash and Cash Equivalents 21,147 35,194
Interest bearing time deposits with other banks 100 100
Securities held to maturity 33,436 37,773
Securities available for sale 98,003 83,882
Federal Home Loan Bank stock 6,304 4,650
Loans, net 395,673 362,265
Premises & equipment 6,072 5,527
Accrued interest receivable 2,276 1,969
Goodwill 2,173 2,173
Cash surrender value of life insurance 11,779 11,548
Other assets 3,856 4,317
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TOTAL ASSETS $580,819 $549,398
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LIABILITIES & STOCKHOLDERS' EQUITY:
Deposits $405,339 $399,905
Advances from Federal Home Loan Bank 113,774 90,286
Subordinated debentures 10,310 10,310
Other liabilities 2,926 2,296
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Total Liabilities 532,349 502,797
Stockholders' equity:
Common stock 41 41
Paid in capital 30,869 29,976
Retained earnings 18,197 16,459
Accum. other comprehensive (loss) income (637) 125
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Total Stockholders' Equity 48,470 46,601
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TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $580,819 $549,398
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SLADE'S FERRY BANCORP AND SUBSIDIARY
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
NINE MONTHS ENDED SEPTEMBER 30,
(Dollars in Thousands, except per share data) 2005 2004
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INTEREST AND DIVIDEND INCOME:
Interest and fees on loans $16,937 $15,061
Interest and dividends on investments 4,075 2,206
Other interest 216 220
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Total interest and dividend income 21,228 17,487
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INTEREST EXPENSE:
Interest on deposits 4,288 3,727
Interest on other borrowed funds 3,127 1,800
Interest on subordinated debentures 457 236
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Total interest expense 7,872 5,763
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Net interest and dividend income 13,356 11,724
Provision for loan losses 109 376
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Net interest and dividend income after
provision for loan losses 13,247 11,348
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OTHER INCOME:
Service charges on deposit accounts 272 404
Overdraft service charges 351 404
Gain of sale of assets 51 -
Security gains, net 27 46
Gain on sale of loan 50 196
Other income 960 926
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Total other income 1,711 1,976
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OPERATING EXPENSE:
Salaries and employee benefits 6,243 6,027
Occupancy expense 702 599
Equipment expense 551 418
Other expenses 3,123 2,850
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Total other expense 10,619 9,894
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Income before income taxes 4,339 3,430
Income taxes 1,491 1,143
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Net income $ 2,848 $ 2,287
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Basic earnings per share $ 0.69 $ 0.57
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Diluted earnings per share $ 0.69 $ 0.56
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SLADE'S FERRY BANCORP AND SUBSIDIARY
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED SEPTEMBER 30,
(Dollars in Thousands, except per share data) 2005 2004
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INTEREST AND DIVIDEND INCOME:
Interest and fees on loans $5,943 $5,194
Interest and dividends on investments 1,471 998
Other interest 48 58
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Total interest and dividend income 7,462 6,250
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INTEREST EXPENSE:
Interest on deposits 1,672 1,280
Interest on other borrowed funds 1,142 627
Interest on subordinated debentures 166 118
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Total interest expense 2,980 2,025
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Net interest and dividend income 4,482 4,225
Provision for loan losses 44 -
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Net interest and dividend income after
provision for loan losses 4,438 4,225
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OTHER INCOME:
Service charges on deposit accounts 81 132
Overdraft fees 122 149
Gain on sale of assets (1) -
Security gains, net 10 7
Gain on sale of loan 50 196
Other income 340 329
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Total other income 602 813
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OPERATING EXPENSE:
Salaries and employee benefits 2,148 1,945
Occupancy expense 251 179
Equipment expense 193 67
Other expenses 1,090 1,271
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Total other expense 3,682 3,462
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Income before income taxes 1,358 1,576
Income taxes 458 500
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Net income $ 900 $1,076
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Basic earnings per share $ 0.22 $ 0.27
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Diluted earnings per share $ 0.22 $ 0.26
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