Exhibit 99.2 Press Release
PRESS RELEASE
January 27, 2003 For further information contact:
David M. Bradley
Chairman, President and Chief Executive Officer
North Central Bancshares, Inc.
825 Central Avenue PO Box 1237
Fort Dodge, Iowa 50501
515-576-7531
NORTH CENTRAL BANCSHARES, INC. ANNOUNCES RECORD EARNINGS FOR YEAR ENDED DECEMBER
31, 2002
Fort Dodge, Iowa -- North Central Bancshares, Inc. (the "Company")
(Nasdaq: FFFD), the holding company for First Federal Savings Bank of Iowa (the
"Bank"), announced today that the Company earned a record $3.37 diluted earnings
per share for the year ended December 31, 2002, compared to diluted earnings per
share of $2.41 for the year ended December 31, 2001, an increase in diluted
earnings per share of 39.8%. In dollars, the Company's net income was a record
$5.9 million for the year ended December 31, 2002, as compared to $4.5 million
for the year ended December 31, 2001, an increase of 31.1%.
The Company's net income was $1.5 million, or diluted earnings per share of
$0.87, for the quarter ended December 31, 2002, compared to $1.2 million, or
diluted earnings per share of $0.69, for the quarter ended December 31, 2001, an
increase in net income of 22.2% and in diluted earnings per share of 26.1%.
Total assets at December 31, 2002 were $403.9 million as compared to $379.4
million at December 31, 2001. The increase in assets resulted primarily from an
increase in loans, offset by a decrease in interest-bearing cash and securities
available-for-sale. Loans increased by $33.2 million, or 10.8%, to $341.1
million at December 31, 2002 from $308.0 million at December 31, 2001. The
increase in loans was funded in part by increases in deposits and borrowings and
decreases in interest-bearing cash and securities available-for-sale. At
December 31, 2002, net loans consisted of $147.5 million of one-to four-family
loans, $70.2 million of multifamily real estate loans, $70.5 million of
commercial real estate loans and $53.0 million of consumer loans. The increase
in loans was primarily due to the purchase of $79.3 million of multifamily and
commercial real estate loans. Securities available-for-sale decreased $8.5
million, or 27.2%, from $31.4 million at December 31, 2001 to $22.8 million at
December 31, 2002. The decrease in securities available-for- sale was primarily
due to calls, maturities and sales during the year ended December 31, 2002.
Deposits increased $8.2 million, or 3.0%, to $277.0 million at December 31, 2002
from $268.8 million at December 31, 2001. Other borrowed funds increased $13.6
million, or 19.1%, to $85.0 million at December 31, 2002 from $71.4 million at
December 31, 2001. The increase in the deposits and borrowed funds were used in
part to fund asset growth.
Nonperforming assets were 0.34% of total assets as of December 31, 2002 compared
to 0.36% of total assets as of December 31, 2001. The allowance for loan losses
was $3.1 million, or 0.90% of total loans, at December 31, 2002, compared to
$2.9 million, or 0.92% of total loans, at December 31, 2001.
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The net interest spread of 3.15% for the year ended December 31, 2002
represented an increase from the net interest spread of 2.68% for the year ended
December 31, 2001. The net interest margin of 3.44% for the year ended December
31, 2002 represented an increase from the net interest margin of 3.03% for the
year ended December 31, 2001. Net interest income for the year ended December
31, 2002 was $13.1 million, compared to net interest income of $11.0 million for
the year ended December 31, 2001.
The Company's provision for loan losses was $383,000 and $210,000 for the years
ended December 31, 2002 and 2001, respectively. The increase in the provision
for loan losses was due primarily to increases in the loan portfolio for the
year ended December 31, 2002. The Company establishes provisions for loan
losses, which are charged to operations, in order to maintain the allowance for
loan losses at a level which is deemed to be appropriate based upon an
assessment of prior conditions, the volume and type of loans in the Bank's
portfolio, and other factors related to the collectibility of the Bank's loan
portfolio.
The Company's noninterest income was $5.7 million and $5.1 million for the years
ended December 31, 2002 and 2001, respectively. The increase in noninterest
income was due in part to increases in loan prepayment fees, abstract fees and
sales of annuity and mutual funds, offset in part by a decrease in insurance
sales.
The Company's noninterest expense was $9.6 million and $9.0 million for the
years ended December 31, 2002 and 2001, respectively. The increase in
noninterest expense was due in part to increases in salaries and employee
benefits, data processing and other expenses, offset in part by a decrease in
goodwill amortization. During the six months ended December 31, 2002, the
Company recorded a pension contribution expense that totaled $105,000. The
Company is a participant in the Financial Institutions Retirement Fund ("FIRF")
and has been notified that a contribution will be required for the plan year
ended June 30, 2003. The FIRF has been fully funded since July 1988 and no
pension expense was recorded for the years ended December 31, 1989 until
December 31, 2001.
Stockholders' equity was $38.7 million at December 31, 2002, compared to $35.9
million at December 31, 2001. Stockholders' equity increased by $2.8 million
primarily due to earnings and the exercise of stock options, offset in part by
stock repurchases and declared dividends. Book value, or stockholders' equity
per share, at December 31, 2002 was $23.62 compared to $21.12 at December 31,
2001. The ratio of stockholders' equity to total assets was 9.6% at December 31,
2002, as compared to 9.5% at December 31, 2001.
All stockholders of record on December 16, 2002, received a quarterly cash
dividend of $0.18 per share on January 7, 2003. On September 27, 2002, the
Company commenced a new stock repurchase program for 100,000 shares, of which
77,600 shares remain to be repurchased. The Company has 1,640,280 shares of
common stock currently outstanding.
During the year ended December 31, 2002, the Company repurchased a total of
133,100 shares or approximately 7.8% of its outstanding shares of common stock
as of December 31, 2001 at prevailing market prices averaging $26.82 per share.
Since its formation in 1996, the Company has invested a total of $43.6 million
in the repurchase of 2,496,867 shares of its outstanding stock.
North Central Bancshares, Inc. serves north central and southeastern Iowa at
nine full service locations in Fort Dodge, Nevada, Ames, Perry, Ankeny,
Burlington and Mount Pleasant, Iowa through its wholly owned subsidiary, First
Federal Savings Bank of Iowa, headquartered in Fort Dodge, Iowa. Construction
has begun on a new 5,000 square foot facility in Ankeny, Iowa. The Bank's Ankeny
office will relocate to this new office when completed, sometime during the
first quarter of 2003.
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The Bank's deposits are insured by the Federal Deposit Insurance Corporation
under the full extent permitted by law. The Company's stock is traded on The
Nasdaq National Market under the symbol "FFFD".
Statements contained in this news release, which are not historical facts,
contain forward-looking statements as that term is defined in the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements are
subject to risk and uncertainties which could cause actual results to differ
materially from those currently anticipated due to a number of factors, which
include, but are not limited to, factors discussed in documents filed by the
Company with the Securities and Exchange Commission from time to time. The
Company or the Bank does not undertake to update any forward-looking statement,
whether written or oral, that may be made from time to time by or on behalf of
the Company or the Bank.
For more information contact: David M. Bradley, President and Chief Executive
Officer, 515-576-7531
FINANCIAL HIGHLIGHTS OF NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Financial Condition
(Unaudited)
(Dollars in Thousands, except per share and share data)
December 31, 2002 December 31, 2001
------------------------------------------
Assets
Cash and cash equivalents $ 15,169 $ 19,909
Securities available for sale 22,834 31,366
Loans (net of allowance of loan loss of $3,118 341,146
and $2,883, respectively) 4,971 307,981
Goodwill 19,752 4,971
---------- ----------
Other assets 15,148
Total Assets $ 403,872 $ 379,375
========== ==========
Liabilities
Deposits $ 277,000 $ 268,814
Other borrowed funds 85,026 71,413
Other liabilities 3,098 3,235
---------- ----------
Total Liabilities 365,124 343,462
Stockholders' Equity 38,748 35,913
---------- ----------
Total Liabilities and Stockholders' Equity $ 403,872 $ 379,375
========== ==========
Stockholders' equity to total assets 9.61% 9.47%
========== ==========
Book value per share $ 23.62 $ 21.12
========== ==========
Total shares outstanding 1,640,280 1,700,280
========== ==========
Condensed Consolidated Statements of Income
(Unaudited)
(Dollars in Thousands, except per share data)
For the Three Months For the Years
Ended December 31, Ended December 31,
2002 2001 2002 2001
-------------------------------------------------------
Interest income $ 6,737 $ 6,644 $ 26,965 $ 27,500
Interest expense 3,387 3,773 13,911 16,514
------- ------- -------- --------
Net interest income 3,350 2,871 13,054 10,986
Provision for loan loss 57 60 383 210
------- ------- -------- --------
Net interest income after provision for loan loss 3,293 2,811 12,671 10,776
Noninterest income 1,519 1,550 5,729 5,092
Noninterest expense 2,530 2,453 9,582 9,046
------- ------- -------- --------
Income before income taxes 2,282 1,908 8,818 6,822
Income taxes 780 678 2,953 2,347
------- ------- -------- --------
Net income $ 1,502 $ 1,230 $ 5,865 $ 4,475
======= ======= ======== ========
Basic earnings per share $ 0.92 $ 0.73 $ 3.58 $ 2.54
======= ======= ======== ========
Diluted earnings per share $ 0.87 $ 0.69 $ 3.37 $ 2.41
======= ======= ======== ========
Selected Financial Ratios
For the Three Months For the Years
Ended December 31, Ended December 31,
2002 2001 2002 2001
-----------------------------------------------------------
Performance ratios
Net interest spread 3.22% 2.96% 3.15% 2.68%
Net interest margin 3.48% 3.24% 3.44% 3.03%
Return on average assets 1.48% 1.30% 1.47% 1.17%
Return on average equity 15.45% 13.59% 15.57% 12.21%
Efficiency ratio (noninterest expense divided by
the sum of net interest income before provision
for loan losses plus noninterest income) 51.95% 55.48% 51.01% 56.26%