Exhibit 99.1
Contact:
Arthur F. Birmingham
Peapack-Gladstone Financial Corporation
T: 908-719-4308
PEAPACK-GLADSTONE FINANCIAL CORPORATION
REPORTS RECORD FIRST QUARTER RESULTS
GLADSTONE, N.J.--(BUSINESS WIRE)--April 26, 2005 - Peapack-Gladstone Financial
Corporation (AMEX:PGC) reported net income of $3.7 million for the first quarter
of 2005, as compared to $3.3 million for the first quarter of 2004, an increase
of $422 thousand or 12.9 percent. This level of net income represents the
highest ever recorded in any quarter in the Corporation's history. For the first
quarter of 2005, net income per diluted share was $0.44, an increase of $0.05 or
12.8 percent, when compared to $0.39 for the first quarter of 2004. The
annualized return on average assets ("ROA") was 1.33 percent and the annualized
return on average equity ("ROE") was 15.51 percent for the first quarter of
2005.
Frank A. Kissel, Chairman and CEO, stated, "We are pleased with the results
we achieved this quarter. Despite the challenges faced in the quarter, including
margin compression, a flattening yield curve and competitive deposit pricing, we
were able to post an 8.3 percent increase in net interest income. Although the
net interest margin contracted 30 basis points compared to the first quarter of
2004, our plan to expand our lending and deposit gathering into new communities
has allowed us to grow our business at a pace that mitigated the lower net
interest margin.
"We plan on continuing this strategy of branching into communities that are
contiguous to our current market area. Pending regulatory approval, we
anticipate opening a new branch, our 20th location, in Bridgewater, New Jersey,
this summer."
Mr. Kissel continued, "Supplementing our traditional banking revenue was an
outstanding quarter by PGB Trust and Investments. Trust fee income surpassed $2
million for the first time in the first quarter of 2005, an increase of over 19
percent over 2004 first quarter levels."
EARNINGS
Net Interest Income
Net interest income for the first quarter of 2005, on a tax-equivalent
basis, was $9.3 million, an increase of $711 thousand or 8.3 percent over the
same period last year and a decline of $130 thousand or 1.4 percent over the
fourth quarter of 2004. On a fully tax-equivalent basis, net interest margin for
the first quarter was 3.53 percent as compared to 3.83 percent for the same
quarter last year and 3.78 percent for the fourth quarter of 2004.
Average-earning assets increased to $1.05 billion in the first quarter of
2005, rising $155.6 million or 17.4 percent, from $893.7 million in the first
quarter of 2004. The yield on interest earning assets increased to 4.92 percent
from 4.80 percent, a 12 basis point increase from first quarter 2004 to first
quarter 2005.
Loans continued to experience strong growth, averaging $593.1 million for
the first quarter of 2005 as compared to $426.4 million for the first quarter of
2004, an increase of $166.6 million, or 39.1 percent. In the first quarter of
2005 as compared to the first quarter of 2004, the mortgage loan portfolio
experienced growth of $140.4 million or 43.3 percent, while the commercial loan
portfolio grew $22.2 million or 32.7 percent. Most of the mortgage loan growth
was in adjustable-rate residential mortgage loans, which resulted from new
business initiatives and our entry into new market areas. Average investment
securities declined $2.4 million or 0.5 percent from the first quarter of 2004
to the first quarter of 2005.
Average deposits totaled $952.8 million for the first quarter of 2005 as
compared to $821.0 million for the same period in 2004, a $131.7 million or 16.0
percent increase. Contributing to deposit growth was the introduction of the Fed
Tracker Money Market Account, the Fed Flyer CD and the Master Escrow Account,
products that have been favorably received by our customers. Average borrowings
increased $20.0 million, or 54.9 percent, from $36.5 million in the first
quarter of 2004 to $56.5 million for the first quarter of 2005. Borrowings
supplemented funding requirements for asset growth in the first quarter of 2005.
The cost of funds increased to 1.44 percent in the first quarter of 2005 as
compared to 1.01 percent in the first quarter of 2004 as the Federal Reserve
increased the Federal Funds rate five times during the year, which resulted in
higher retail deposit interest rates.
Other Income
Other income was $3.2 million for the first quarter of 2005 as compared to
$2.6 million in the first quarter of 2004, an increase of $530 thousand or 20.2
percent. Income from PGB Trust and Investments was $2.0 million, an increase of
$330 thousand or 19.6 percent over the same quarter last year, which is
attributable to an increase in trust assets. For the first quarter of 2005,
securities gains were $298 thousand as compared to $193 thousand in the first
quarter of last year. This year's gain included the recognition of a $249
thousand gain on the non-monetary exchange of equity securities.
Other Expenses
Other expenses totaled $6.6 million for the first quarter of 2005, an
increase of $516 thousand or 8.5 percent, when compared to $6.0 million for the
same quarter of 2004. Salaries and benefits expense was $3.7 million for the
first quarter of 2005 as compared to $3.5 million for the same quarter of 2004,
growing $189 thousand, or 5.5 percent. Normal salary increases as well as
additions to the professional staff and branch expansion account for the
increase. Occupancy expenses increased $251 thousand or 19.1 percent to $1.6
million for the first quarter of 2005 as compared to $1.3 million for the same
quarter of 2004. In the past year, occupancy expenses have grown due to the
investment in two new branches and a new data center. Costs also rose this year
as the Corporation invested in its technological capacity for future growth and
the expectation of increased levels of business activity. Other non-interest
expense remained constant at $1.3 million for the first quarters of 2005 and
2004.
ASSET QUALITY
At March 31, 2005, non-performing loans totaled $255 thousand or 0.04
percent of total loans as compared to $153 thousand or 0.04 percent at March 31,
2004.
Mr. Kissel stated, "We are pleased to report that credit quality remains
strong with low levels of loan delinquencies. During this period of strong loan
growth, we remain committed to maintaining credit quality."
The allowance for loan losses was $6.2 million or 1.00 percent of total
loans at March 31, 2005 as compared to $5.6 million or 1.29 percent of total
loans at March 31, 2004. Net recoveries of $7 thousand were recorded in the
first quarter of 2005 while $55 thousand of net charge-offs were recorded in the
first quarter of 2004.
CAPITAL
At March 31, 2005, shareholders' equity totaled $94.3 million as compared
with $89.3 million at March 31, 2004, an increase of $5.0 million or 5.6
percent. The Corporation's leverage ratio, tier 1 and total risk based capital
ratios at March 31, 2005 were 8.62 percent, 18.46 percent and 19.65 percent,
respectively.
As previously reported, the Corporation announced a Stock Repurchase Plan
on April 15, 2005. The Board of Directors approved the repurchase of 150,000
shares of Peapack-Gladstone Financial Corporation outstanding common stock
during the next twelve months. The acquired shares are to be held in treasury to
be used for general corporate purposes.
Peapack-Gladstone Financial Corporation is a bank holding company with
total assets of $1.14 billion as of March 31, 2005. Peapack-Gladstone Bank, its
wholly owned community bank was established in 1921, and has 19 branches in
Somerset, Hunterdon and Morris Counties. Its Trust Division, PGB Trust and
Investments, operates at the Bank's main office located at 190 Main Street in
Gladstone and at its Morristown office located at 233 South Street. To learn
more about Peapack-Gladstone Financial Corporation and its services please visit
our web site at www.pgbank.com or call 908-234-0700.
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The foregoing contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements are not
historical facts and include expressions about management's view of future
interest income and net loans, management's confidence and strategies and
management's expectations about new and existing programs and products,
relationships, opportunities and market conditions. These statements may be
identified by such forward-looking terminology as "expect", "look", "believe",
"anticipate", "may", or similar statements or variations of such terms. Actual
results may differ materially from such forward-looking statements. Factors that
may cause results to differ materially from such forward-looking statements
include, but are not limited to, an unexpected decline in the direction of the
economy in New Jersey, unexpected changes in interest rates, unexpected loan
prepayment volume, a decline in levels of loan quality and origination volume
and a decline in the volume of increase in trust assets or deposits.
Peapack-Gladstone assumes no obligation for updating any such forward-looking
statements at any time.
(Tables to Follow)
PEAPACK-GLADSTONE FINANCIAL CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
UNAUDITED
(Dollars in Thousands, Except Per Share Amounts)
At or For The Three Months
Ended
March 31,
2005 2004
---- ----
Income Statement Data:
Interest Income $ 12,656 $ 10,522
Interest Expense 3,629 2,159
---------- ----------
Net Interest Income 9,027 8,363
Provision For Loan Losses 150 150
---------- ----------
Net Interest Income After
Provision For Loan Losses 8,877 8,213
Trust Fees 2,013 1,683
Other Income 839 744
Securities Gains 298 193
Other Expenses 6,555 6,039
---------- ----------
Income Before Income Taxes 5,472 4,794
Income Tax Expense 1,769 1,513
---------- ----------
Net Income $ 3,703 $ 3,281
========== ==========
Balance Sheet Data:
Total Assets $1,136,215 $ 974,679
Federal Funds Sold 915 24,592
Short-Term Investments 674 721
Securities Held To Maturity 85,824 94,883
Securities Available For Sale 370,986 366,155
Loans 614,173 429,636
Allowance For Loan Losses 6,161 5,562
Deposits 986,682 846,805
Borrowings 49,727 29,627
Shareholders' Equity 94,271 89,302
Trust Department Assets
(Market Value, Not
Included Above) $1,657,831 $1,478,500
Average Balance Sheet Data:
Total Assets $1,109,625 $ 951,597
Earning Assets 1,049,305 893,694
Loans, net 587,036 420,897
Interest-Bearing Deposits 786,412 672,155
Demand Deposits 166,339 148,884
Borrowings 56,536 36,495
Shareholders' Equity 95,505 86,705
Performance Ratios:
Return on Average Assets 1.33% 1.38%
Return on Average Equity 15.51 15.14
PEAPACK-GLADSTONE FINANCIAL CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
UNAUDITED
(Dollars in Thousands, Except Per Share Amounts)
At or For The Three Months
Ended
March 31,
2005 2004
---- ----
Net Interest Margin
(Taxable Equivalent Basis) 3.53% 3.83%
Asset Quality:
Loans past due over 90 days
And Still Accruing $ 12 $ 52
Non-Accrual Loans 243 101
Net Recoveries/(Charge-Offs) 7 (55)
Allowance For Loan Losses
To Total Loans 1.00% 1.29%
Per Share Data: (1)
Earnings Per Share (Basic) $ 0.45 $ 0.40
Earnings Per Share (Diluted) 0.44 0.39
Book Value Per Share 11.40 10.92
Dividends Per Share 0.11 0.10
Capital Adequacy:
Tier I Leverage 8.62% 8.89%
Tier I Capital to Risk-
Weighted Assets 18.46 20.71
Tier I & II Capital to
Risk-Weighted Assets 19.65 22.07
(1) Restated for the effect of the 10 percent stock dividend declared September
9, 2004.
PEAPACK-GLADSTONE FINANCIAL CORPORATION
AVERAGE BALANCE SHEET
UNAUDITED
YEAR-TO-DATE
(Tax-Equivalent Basis, Dollars in Thousands)
March 31, 2005 March 31, 2004
Average Income/ Average Income/
Balance Expense Yield Balance Expense Yield
ASSETS:
Interest-Earning Assets:
Investments:
Taxable (1) $ 402,107 $ 4,003 3.98% $ 419,082 $ 4,059 3.87%
Tax-Exempt (1) (2) 51,741 603 4.66% 37,155 488 5.25%
Loans (2) (3) 593,063 8,280 5.58% 426,423 6,145 5.76%
Federal Funds Sold 1,772 11 2.48% 6,794 16 0.95%
Interest-Earning Deposits 622 3 1.93% 4,240 11 1.07%
------------ ------------------ ---------- ------------------
Total Interest-Earning
Assets 1,049,305 $ 12,900 4.92% 893,694 $ 10,719 4.80%
------------ ------------------ ---------- ------------------
Noninterest-Earning Assets:
Cash and Due from Banks 20,968 18,845
Allowance for Loan
Losses (6,027) (5,526)
Premises and Equipment 20,176 15,972
Other Assets 25,203 28,612
------------ ----------
Total Noninterest-Earning
Assets 60,320 57,903
------------ ----------
Total Assets $ 1,109,625 $ 951,597
============ ==========
LIABILITIES:
Interest-Bearing Deposits
Checking $ 200,839 $ 528 1.05% $ 131,837 $ 110 0.34%
Money Markets 105,210 434 1.65% 65,412 101 0.62%
Tiered Money Markets 122,855 415 1.35% 149,460 344 0.92%
Savings 105,701 182 0.69% 102,276 161 0.63%
Certificates of Deposit 251,807 1,633 2.59% 223,170 1,174 2.10%
------------ ------------------ ---------- ------------------
Total Interest-Bearing
Deposits 786,412 3,192 1.62% 672,155 1,890 1.12%
Borrowings 56,536 437 3.09% 36,495 269 2.94%
------------ ------------------ ---------- ------------------
Total Interest-Bearing
Liabilities 842,948 3,629 1.72% 708,650 2,159 1.22%
------------ ------------------ ---------- ------------------
Noninterest Bearing
Liabilities
Demand Deposits 166,339 148,884
Accrued Expenses and
Other Liabilities 4,833 7,358
------------ ----------
Total Noninterest-Bearing
Liabilities 171,172 156,242
Shareholders' Equity 95,505 86,705
------------ ----------
Total Liabilities and
Shareholders' Equity $ 1,109,625 $ 951,597
============ ==========
Net Interest Income $ 9,271 $ 8,560
========== ==========
Net Interest Spread 3.20% 3.58%
======== ========
Net Interest Margin (4) 3.53% 3.83%
======== ========
(1) Average balances for available-for-sale securities are based on amortized
cost.
(2) Interest income is presented on a tax-equivalent basis using a 35 percent
federal tax rate.
(3) Loans are stated net of unearned income and include non-accrual loans.
(4) Net interest income on a tax-equivalent basis as a percentage of total
average interest-earning assets.