Exhibit 99.1 Press Release
PRESS RELEASE
February 2, 2005
For further information contact:
David M. Bradley
Chairman, President and Chief Executive Officer
North Central Bancshares, Inc.
825 Central Avenue
Fort Dodge, Iowa 50501
515-576-7531
NORTH CENTRAL BANCSHARES, INC. ANNOUNCES ANNUAL RESULTS
FOR YEAR END 2004 AND STOCK REPURCHASE PROGRAM
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 $3.34 diluted earnings per share for the
year ended December 31, 2004, compared to diluted earnings per share of $3.48
for the year ended December 31, 2003. The Company's net income was $5.40 million
for the year ended December 31, 2004, as compared to $5.85 million for the year
ended December 31, 2003.
The Company's net income was $1.31 million, or diluted earnings per share of
$0.83, for the fourth quarter of 2004, compared to net income of $1.32 million,
or diluted earnings per share of $0.79, for the fourth quarter of 2003.
Net interest income for the year ended December 31, 2004 was $13.5 million,
compared to net interest income of $13.1 million for the year ended December 31,
2003. The increase in net interest income was due primarily to an increase in
interest-earning assets, offset in part by a decrease in the net interest
margin. The net interest spread of 2.95% for the year ended December 31, 2004
represented a decrease from the net interest spread of 3.01% for the year ended
December 31, 2003. The net interest margin of 3.19% for the year ended December
31, 2004 represented a decrease from the net interest margin of 3.26% for the
year ended December 31, 2003.
The Company's provision for loan losses was $240,000 and $255,000 for the years
ended December 31, 2004 and 2003, respectively. 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. These factors include prior loss experience,
industry standards, past due loans, economic conditions, the volume and type of
loans in the Bank's portfolio, which includes a significant amount of
multi-family and commercial real estate loans, substantially all of which are
purchased and are collateralized by properties located outside of the Bank's
market area, and other factors related to the collectibility of the Bank's loan
portfolio.
The Company's noninterest income was $6.0 million and $6.6 million for the years
ended December 31, 2004 and 2003, respectively. The decrease in noninterest
income was due in part to decreases in mortgage banking income, loan prepayment
fees, and abstract fees, offset in part by increases in fees associated with
checking accounts, including overdraft fees, and other income.
-MORE-
The Company's noninterest expense was $11.4 million and $10.9 million for the
years ended December 31, 2004 and 2003, respectively. The increase in
noninterest expense was due in part to increases in employee salary and benefits
costs, expenses associated with the Bank's new branch offices in Ankeny and
Clive, Iowa, an increase in costs associated with checking accounts, and a
general increase in other noninterest expenses.
The Company's provision for income taxes was $2.5 million and $2.7 million for
the years ended December 31, 2004 and 2003, respectively. The decrease in the
provision for income taxes was due to the decrease in the income before income
taxes, an increase in recurring low-income federal tax credit, offset in part by
a one time low-income housing Iowa income tax credit with an effect on net
income of approximately $110,000 that was recorded in 2003.
Total assets at December 31, 2004 were $462.7 million as compared to $424.0
million at December 31, 2003. The increase in assets consisted of an increase in
loans, offset by a decrease in securities available-for-sale and cash and cash
equivalents. Net loans increased by $44.4 million, or 12.2%, to $407.3 million
at December 31, 2004 from $363.0 million at December 31, 2003. At December 31,
2004, net loans consisted of $184.3 million of one-to-four family real estate
loans, $89.8 million of commercial real estate loans, $78.0 million of
multi-family real estate loans, and $55.2 million of consumer loans. The
increase in net loans was due primarily to the origination of one-to-four family
real estate loans, the purchase of one-to-four family, multi-family, and
commercial real estate loans, and the origination of second mortgage loans.
These originations and purchases were offset in part by payments, prepayments,
and sales of loans. Securities available-for-sale decreased $3.8 million, or
14.3%, to $23.1 million at December 31, 2004 from $27.0 million at December 31,
2003. The decrease in securities available-for-sale consisted primarily of a
decrease in investment in mortgage-backed securities and an increase in
unrealized loss on securities. Cash and cash equivalents decreased $2.1 million,
or 21.0%, to $7.9 million at December 31, 2004 from $10.0 million at December
31, 2003.
Deposits increased $32.4 million, or 11.4%, to $316.3 million at December 31,
2004 from $284.0 million at December 31, 2003. Other borrowed funds increased
$6.0 million, or 6.3%, to $101.0 million at December 31, 2004 from $95.0 million
at December 31, 2003. The increase in the deposits and borrowed funds were used
primarily to fund loan growth.
Nonperforming assets were 0.37% of total assets as of December 31, 2004 compared
to 0.49% of total assets as of December 31, 2003. The allowance for loan losses
was $3.2 million, or 0.77% of total loans, at December 31, 2004, compared to
$3.2 million, or 0.86% of total loans, at December 31, 2003.
Stockholders' equity was $41.5 million at December 31, 2004, compared to $41.6
million at December 31, 2003. Stockholders' equity decreased by $0.1 million
primarily due to stock repurchases, declared dividends, and an increase in
unrealized loss on securities available-for-sale, offset in part by earnings and
the exercise of stock options. Book value, or stockholders' equity per share, at
December 31, 2004 was $27.14 compared to $25.92 at December 31, 2003. The ratio
of stockholders' equity to total assets was 9.0% at December 31, 2004, as
compared to 9.8% at December 31, 2003.
All stockholders of record on December 15, 2004, received a quarterly cash
dividend of $0.25 per share on January 6, 2005. As of December 31, 2004, the
Company had 1,530,530 shares of common stock outstanding.
During the year ended December 31, 2004, the Company repurchased a total of
143,055 shares of common stock, or approximately 8.9% of its outstanding shares
of common stock at prevailing market prices averaging $37.46 per share.
The Company also announced that it will commence a new stock repurchase program.
The program authorizes the Company to repurchase up to 6.53% or 100,000 shares
of its 1,530,530 outstanding shares of common stock during the next twelve
months. The repurchases will be made from time to time, in open market
transactions, at the discretion of management.
North Central Bancshares, Inc. serves north central and southeastern Iowa at ten
full service locations in Fort Dodge, Nevada, Ames, Perry, Ankeny, Clive,
Burlington, and Mount Pleasant, Iowa through its wholly-owned subsidiary, First
Federal Savings Bank of Iowa, headquartered in Fort Dodge, Iowa.
The Bank's deposits are insured by the Federal Deposit Insurance Corporation up
to the full extent permitted by law.
Statements included in this press release and in future filings by North Central
Bancshares, Inc. with the Securities and Exchange Commission, in North Central
Bancshares, Inc. press releases, and in oral statements made with the approval
of an authorized executive officer, which are not historical or current facts,
are "forward-looking statements" made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995, and are subject to certain
risks and uncertainties that could cause actual results to differ materially
from historical earnings and those presently anticipated or projected. North
Central Bancshares, Inc. wishes to caution readers not to place undue reliance
on such forward-looking statements, which speak only as of the date made. The
following important factors, among others, in some cases have affected and in
the future could affect North Central Bancshares, Inc.'s actual results, and
could cause North Central Bancshares, Inc.'s actual financial performance to
differ materially from that expressed in any forward-looking statement: (1)
competitive pressures among depository and other financial institutions may
increase significantly; (2) revenues may be lower than expected; (3) changes in
the interest rate environment may reduce interest margins; (4) general economic
conditions, either nationally or regionally, may be less favorable than
expected, resulting in, among other things, a deterioration in credit quality
and/or a reduced demand for credit; (5) legislative or regulatory changes,
including changes in accounting standards, may adversely affect the business in
which the Company is engaged; (6) competitors may have greater financial
resources and developed products that enable such competitors to compete more
successfully than the Company; and (7) adverse changes may occur in the
securities markets or with respect to inflation. The foregoing list should not
be construed as exhaustive, and North Central Bancshares, Inc. disclaims any
obligation to subsequently revise any forward-looking statements to reflect
events or circumstances after the date of such statements, or to reflect the
occurrence of anticipated or unanticipated events.
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, 2004 December 31, 2003
----------------- -----------------
Assets
Cash and cash equivalents $ 7,918 $ 10,019
Securities available-for-sale 23,106 26,952
Loans (net of allowance of loan loss of $3,235 and
$3,165, respectively) 407,316 362,959
Goodwill 4,971 4,971
Other assets 19,424 19,108
---------- ----------
Total Assets $ 462,735 $ 424,009
========== ==========
Liabilities
Deposits $ 316,334 $ 283,964
Other borrowed funds 100,975 95,005
Other liabilities 3,892 3,448
---------- ----------
Total Liabilities 421,201 382,417
Stockholders' Equity 41,534 41,592
---------- ----------
Total Liabilities and Stockholders' Equity $ 462,735 $ 424,009
========== ==========
Stockholders' equity to total assets 8.98% 9.81%
========== ==========
Book value per share $ 27.14 $ 25.92
========== ==========
Total shares outstanding 1,530,530 1,604,780
========== ==========
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,
2004 2003 2004 2003
-------------------------------------------------------------------------
Interest income $ 6,319 $ 6,146 $24,838 $25,456
Interest expense 2,888 2,969 11,367 12,342
------- ------- ------- -------
Net interest income 3,431 3,177 13,471 13,114
Provision for loan loss 55 60 240 255
------- ------- ------- -------
Net interest income after provision for loan loss 3,376 3,117 13,231 12,859
Noninterest income 1,464 1,714 6,033 6,570
Noninterest expense 2,958 2,888 11,369 10,860
------- ------- ------- -------
Income before income taxes 1,882 1,943 7,895 8,569
Income taxes 573 619 2,496 2,721
------- ------- ------- -------
Net income $ 1,309 $ 1,324 $ 5,399 $ 5,848
======= ======= ======= =======
Basic earnings per share $ 0.85 $ 0.83 $ 3.47 $ 3.69
======= ======= ======= =======
Diluted earnings per share $ 0.83 $ 0.79 $ 3.34 $ 3.48
======= ======= ======= =======
For the Three Months For the Years
Selected Financial Ratios Ended December 31, Ended December 31,
2004 2003 2004 2003
----------------------------------------------------------------------
Performance ratios
Net interest spread 2.94% 2.91% 2.95% 3.01%
Net interest margin 3.16% 3.14% 3.19% 3.26%
Return on average assets 1.14% 1.24% 1.21% 1.38%
Return on average equity 12.57% 12.83% 12.97% 14.65%
Efficiency ratio (noninterest expense divided by
the sum of net interest income before provision
for loan losses plus noninterest income) 60.43% 59.05% 58.29% 55.17%