Exhibit 99.1
CENTRAL COAST BANCORP
PRESS RELEASE Contact: Robert Stanberry
Chief Financial Officer
For Release 9:00am EST (831) 422-6642
CENTRAL COAST BANCORP ANNOUNCES RECORD EARNINGS
FOR THE 17th CONSECUTIVE YEAR
Salinas, California - January 23, 2001. Central Coast Bancorp (Nasdaq/CCBN),
the holding company for Community Bank of Central California, today announced
record net income for both the quarter and year ended December 31, 2000. Net
income for 2000 increased 10.9% to $8,926,000 versus $8,051,000 in 1999.
Diluted earnings per share for 2000 were up 13.6% to $1.25 from $1.10 in
1999. This is the 17th consecutive year of higher year over year earnings
since the Bank's first year of operations in 1983. For 2000, the Company
realized a return on average equity of 16.0% and a return on average assets
of 1.41%, as compared to 15.5% and 1.43% for 1999.
Net income for the fourth quarters of 2000 and 1999 was $2,354,000 and
$2,329,000, respectively. Diluted earnings per share for the two periods
were $0.33 and $0.32. The earnings per share for the 1999 periods have been
adjusted for the 10% stock dividend distributed in February 2000.
At December 31, 2000, the Company had total assets of $704,864,000, which was
an increase of $111,419,000 (18.8%) from year-end 1999. At December 31,
2000, loans totaled $473,395,000, up $77,798,000 (19.7%) from the ending
balances on December 31, 1999. Deposit growth in 2000, net of returning
$20,000,000 of State of California certificates of deposit, was $135,021,000
(27.1%) resulting in ending deposit balances of $633,210,000.
Nick Ventimiglia, Chairman, President and CEO, stated that, "Once again we
are pleased to be able to add one more year to the Bank's now 17th
consecutive year of increased earnings. We are also extremely proud of the
balance sheet growth the Bank has achieved this year. It has all come from
internal growth and the branch expansions into Watsonville and Hollister.
Our continued goal is to increase shareholder value by becoming the dominant
community based financial institution in the markets we serve by providing
civic leadership and quality services."
Financial Summary:
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Within the following discussion interest income, net interest income and net
interest margin are presented on a fully taxable equivalent basis.
Net interest income for 2000 was $33,927,000, a $5,293,000 (18.5%) increase
over 1999. Interest income was up $9,935,000 (23.5%). Average loan balances
were $68,989,000 (19.8%) higher in 2000. The higher balances added
$6,388,000 to interest income. The average loan yield increased 67 basis
points, which increased interest income by $2,783,000. Interest on
investment securities decreased $144,000 as average balances decreased
$12,066,000. The average balance of Fed Funds sold increased $13,704,000
resulting in an increase in interest income of $678,000. The average rate
received on Fed Funds sold increased 136 basis points. The higher rates
added $230,000 to interest income.
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Interest expense was $4,642,000 higher in 2000. Average balances of
interest-bearing liabilities were higher by $49,628,000, which added
$2,726,000 to interest expense. Average rates paid on interest-bearing
liabilities were up 66 basis points for the year. The higher rates added
$1,916,000 of interest expense. Most of the added interest expense in 2000
was attributable to growth in time deposits and the higher rates paid on
those deposits.
Net interest margins for the years of 2000 and 1999 were 5.88% and 5.65%,
respectively. During 2000, as interest rates rose, the variable rate loans
repriced more quickly than the deposits resulting in quicker growth in
interest income and an improving net interest margin.
In 2000, the Bank provided $3,983,000 for loan losses as compared to
$1,484,000 in 1999. The provision for loan losses in the fourth quarter of
2000 was $1,127,000, which was down $403,000 from the $1,530,000 recorded in
the third quarter of 2000. As discussed in the third quarter 2000 press
release, industry experience indicates that higher provisions be maintained
when there is significant loan growth and loan concentrations. For the
second straight year loan growth exceeded $77,000,000. For 2000 this
represented growth of 19.7% and in 1999 the growth was 26.7%. Besides
providing allowance for loan losses for the preceding factors, additional
loan loss provisions were needed during 2000 for some specific loan
classifications. A significant portion of the provision in 2000 resulted
from several loans to a single borrower being classified as substandard,
which lead to a provision of approximately $1,185,000. At December 31, 2000,
these loans were performing in accordance with their terms and conditions.
Non-performing assets were $754,000 at December 31, 2000 as compared to
$2,110,000 at the same date in 1999. The ratios of the allowance for loan
losses to nonperforming assets on those two dates were 1,243% and 265%,
respectively. The allowance for loan losses to total loans at those dates
was 1.98% and 1.41%, respectively.
Noninterest income was up $202,000 (9.1%) in 2000 over the same period in
1999. The increase was due to higher volumes, new fees and new products.
Noninterest income was negatively impacted in the fourth quarter of 2000 as
the Bank realized a loss of $194,000 on the sale and repositioning of
investment securities. In all of 1999, the Bank had a realized gain of
$45,000 on the sale of investment securities.
Noninterest expenses increased $1,365,000 (8.5%) in 2000 over 1999. Expenses
related to the two new branches accounted for $413,000 of the overall
increase. The following discussion regarding noninterest expenses excludes
the expenses of the two new branches. Salaries and benefits were up $678,000
(7.4%). Base salaries increased $421,000 (6.2%) due to normal merit reviews,
competitive employment environment and staffing additions during the year.
Benefit costs increased commensurate with the salaries. Occupancy and fixed
assets expense increased $461,000 (17.4%). Much of the increase is
attributable to the full year effect of the relocation of two branches and
remodeling of one branch and operations office space during 1999. Other
expenses decreased $187,000 (4.4%). In 1999, the Bank incurred one-time
costs of approximately $245,000 associated with the merger of the Bank of
Salinas and Cypress Bank to form Community Bank of Central California.
Normal price increases and growth in the Bank's operations accounted for the
remaining higher expenses. The efficiency ratio (fully taxable equivalent)
for 2000 was 47.9% as compared to 52.0% in 1999.
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Central Coast Bancorp operates as a holding company for Community Bank of
Central California. Community Bank, headquartered in Salinas, has branch
offices located in the Monterey County communities of Salinas, North Salinas,
Monterey, Seaside, Marina, Castroville, Gonzales and King City, in the Santa
Cruz County community of Watsonville and in the San Benito County community
of Hollister. The Bank provides traditional deposit, lending, mortgage and
commercial products and services to business and retail customers throughout
the California Central Coast area. The Bank has an Internet web site at
www.community-bnk.com.
Forward-Looking Statements
In addition to the historical information contained herein, this press
release contains certain forward-looking statements. The reader of this
press release should understand that all such forward-looking statements are
subject to various uncertainties and risks that could affect their outcome.
The Company's actual results could differ materially from those suggested by
such forward-looking statements. Changes to such risks and uncertainties,
which could impact future financial performance, include, among others: (1)
competitive pressures in the banking industry; (2) changes in the interest
rate environment; (3) general economic conditions, nationally, regionally and
in the operating market areas of the Company and the Bank; (4) changes in the
regulatory environment; (5) changes in business conditions and inflation; (6)
changes in securities markets. This entire press release should be read to
put such forward-looking statements in context and to gain a more complete
understanding of the uncertainties and risks involved in the Company's
business.
301 Main Street, Salinas, California 93901
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CENTRAL COAST BANCORP
CONSOLIDATED FINANCIAL DATA
(Unaudited)
(Dollars in thousands, except share data)
Three Months Ended Twelve Months Ended
December 31 December 31
Statement of Income Data 2000 1999 2000 1999
---- ---- ---- ----
Interest income $ 13,656 $ 11,269 $ 51,415 $ 41,517
Interest expense 4,890 3,681 18,290 13,648
------- ------- ------- -------
Net interest income 8,766 7,588 33,125 27,869
Provision for loan losses 1,127 529 3,983 1,484
Noninterest income 583 569 2,433 2,231
Noninterest expense 4,654 4,285 17,408 16,043
Provision for taxes 1,214 1,014 5,241 4,522
----- ----- ----- -----
Net income $ 2,354 $ 2,329 $ 8,926 $ 8,051
================= ==================
Share Data (adjusted for 10% stock dividend distribution on February 28, 2000)
Earnings per share
Basic $ 0.35 $ 0.33 $ 1.29 $ 1.14
Diluted $ 0.33 $ 0.32 $ 1.25 $ 1.10
Book value per common share $ 8.90 $ 7.52
Shares outstanding 6,722,000 7,084,000 6,722,000 7,084,000
Weighted average shares 6,760,000 7,084,000 6,920,000 7,072,000
Weighted average diluted shares 6,999,000 7,292,000 7,125,000 7,317,000
Balance Sheet Data
Total assets $ 704,864 $ 593,445
Securities, available-for-sale 152,276 145,435
Total loans, gross 473,395 395,597
Allowance for loan losses (9,371) (5,596)
Total deposits 633,210 518,189
Total shareholders' equity 59,854 53,305
Unrealized gain (loss) on securities
available-for-sale, net (1,062) (4,702)
Nonperforming loans 559 1,930
Other real estate owned 195 180
Selected Financial Ratios
Return on average total assets 1.42% 1.57% 1.41% 1.43%
Return on average equity 16.1% 17.7% 16.0% 15.5%
Net interest margin (tax equivalent
basis) 5.93% 5.82% 5.88% 5.65%
Allowance for loan losses to total
loans 1.98% 1.41%
Allowance for loan losses to NPL's 1676% 290%
Allowance for loan losses to NPA's 1243% 265%
Total risk based capital ratio 12.3% 13.8%
Tier 1 Capital ratio 11.1% 12.6%
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