Exhibit 99.1 Press Release
PRESS RELEASE
October 31, 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 RESULTS FOR THIRD QUARTER 2005
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 $1.11 diluted earnings per share for the
quarter ended September 30, 2005, compared to diluted earnings per share of
$0.87 for the quarter ended September 30, 2004. The Company's net income was
$1.75 million for the quarter ended September 30, 2005, compared to $1.39
million for the quarter ended September 30, 2004. The increase in earnings for
the quarter was primarily due to an increase in loan prepayment fees.
The Company earned $2.45 diluted earnings per share for the nine months ended
September 30, 2005, compared to diluted earnings per share of $2.51 for the nine
months ended September 30, 2004. The Company's net income was $3.85 million for
the nine months ended September 30, 2005, compared to $4.09 million for the nine
months ended September 30, 2004. The reduction in earnings for the nine months
was due primarily to an other-than-temporary impairment, non-cash, after-tax
charge of $653,500 on three Freddie Mac adjustable rate, perpetual preferred
stocks, offset in part by an increase in loan prepayment fees.
Net interest income for the quarter ended September 30, 2005 was $3.36 million,
compared to net interest income of $3.38 million for the quarter ended September
30, 2004. Net interest income remained steady for the quarter due primarily to
an increase in interest-earning assets, offset by a decrease in the net interest
margin. The net interest margin of 2.96% for the quarter ended September 30,
2005 represented a decrease from the net interest margin of 3.19% for the
quarter ended September 30, 2004.
Net interest income for the nine months ended September 30, 2005 was $10.28
million, compared to net interest income of $9.98 million for the nine months
ended September 30, 2004. 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 margin of 3.08% for the nine months ended
September 30, 2005 represented a decrease from the net interest margin of 3.23%
for the nine months ended September 30, 2004.
-MORE-
The Company's provision for loan losses was $60,000 and $75,000 for the quarters
ended September 30, 2005 and 2004, respectively. The Company's provision for
loan losses was $180,000 and $185,000 for the nine months ended September 30,
2005 and 2004, 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 loss experience, industry standards, past due loans, economic 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 $2.42 million and $1.51 million for the
quarters ended September 30, 2005 and 2004, respectively. The increase in
noninterest income was due primarily to loan prepayment fees and increases in
fees associated with checking accounts, including overdraft fees. During the
quarter ended September 30, 2005, the Company recorded $705,000 in loan
prepayment fees, compared to $40,000 for the quarter ended September 30, 2004.
The Company's noninterest income was $4.90 million and $4.59 million for the
nine months ended September 30, 2005 and 2004, respectively. The increase in
noninterest income was due primarily to loan prepayment fees and increases in
fees associated with checking accounts, including overdraft fees, offset in part
by an other-than-temporary impairment of securities available-for-sale and a
decrease in abstract fees.
The Company's noninterest expense was $3.14 million and $2.78 million for the
quarters ended September 30, 2005 and 2004, respectively. The increase in
noninterest expense was primarily due to increases in compensation and other
operating expenses.
The Company's noninterest expense was $9.08 million and $8.37 million for the
nine months ended September 30, 2005 and 2004, respectively. The increase in
noninterest expense was primarily due to increases in compensation and other
operating expenses.
The Company's provision for income taxes was $839,000 and $640,000 for the
quarters ended September 30, 2005 and 2004, respectively. The increase in the
provision for income taxes was due to the increase in income before income
taxes.
The Company's provision for income taxes was $2.06 million and $1.92 million for
the nine months ended September 30, 2005 and 2004, respectively. The increase in
the provision for income taxes was primarily due to the limited deductibility of
the other-than-temporary impairment of securities available-for-sale, offset in
part by the decrease in income before income taxes.
Total assets at September 30, 2005 were $484.0 million as compared to $462.7
million at December 31, 2004. The increase in assets consisted primarily of
increases in loans and fixed assets, offset in part by a decrease in securities
available-for-sale. Net loans increased by $22.4 million, or 5.49%, to $429.7
million at September 30, 2005 from $407.3 million at December 31, 2004. At
September 30, 2005, net loans consisted of $205.7 million of one-to-four family
real estate loans, $86.9 million of commercial real estate loans, $76.5 million
of multi-family real estate loans, and $60.6 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 $1.4 million, or
5.86%, to $21.7 million at September 30, 2005 from $23.1 million at December 31,
2004. The decrease in securities available-for-sale consisted primarily of a
decrease in investments in mortgage-backed and municipal securities, offset in
part by an increase in investment in FHLB stock and a decrease in unrealized
losses.
Deposits increased $15.0 million, or 4.74%, to $331.3 million at September 30,
2005 from $316.3 million at December 31, 2004. The increase in the deposits was
used primarily to fund loan growth.
Nonperforming assets were 0.32% of total assets as of September 30, 2005
compared to 0.37% of total assets as of December 31, 2004. The allowance for
loan losses was $3.3 million, or 0.75% of total loans, at September 30, 2005,
compared to $3.2 million, or 0.77% of total loans, at December 31, 2004.
Stockholders' equity was $43.9 million at September 30, 2005, compared to $41.5
million at December 31, 2004. Stockholders' equity increased by $2.4 million
primarily due to earnings, the exercise of stock options, and a decrease in
unrealized loss on securities available-for-sale, offset in part by declared
dividends and stock repurchases. Book value, or stockholders' equity per share,
at September 30, 2005 was $28.92 compared to $27.14 at December 31, 2004. The
ratio of stockholders' equity to total assets was 9.1% at September 30, 2005, as
compared to 9.0% at December 31, 2004.
All stockholders of record on September 16, 2005, received a quarterly cash
dividend of $0.29 per share on October 6, 2005. As of September 30, 2005, the
Company had 1,518,403 shares of common stock outstanding.
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) September 30, 2005 December 31, 2004
------------------ -----------------
Assets
Cash and cash equivalents $ 7,826 $ 7,918
Securities available-for-sale 21,753 23,106
Loans (net of allowance of loan loss of $3,317 and
$3,235, respectively) 429,661 407,316
Goodwill 4,971 4,971
Other assets 19,788 19,424
---------- ----------
Total assets $ 483,999 $ 462,735
========== ==========
Liabilities
Deposits $ 331,328 $ 316,334
Other borrowed funds 105,450 100,975
Other liabilities 3,303 3,892
---------- ----------
Total liabilities 440,081 421,201
Stockholders' equity 43,918 41,534
---------- ----------
Total liabilities and stockholders' equity $ 483,999 $ 462,735
========== ==========
Stockholders' equity to total assets 9.07% 8.98%
========== ==========
Book value per share $ 28.92 $ 27.14
========== ==========
Total shares outstanding 1,518,403 1,530,530
========== ==========
Condensed Consolidated Statements of Income
(Unaudited)
(Dollars in Thousands, except per share data)
For the Three Months For the Nine Months
Ended September 30, Ended September 30,
2005 2004 2005 2004
---------------------------------------------------------------------
Interest income $ 6,624 $ 6,234 $ 19,520 $ 18,459
Interest expense 3,261 2,858 9,239 8,479
----------- ----------- ----------- -----------
Net interest income 3,363 3,376 10,281 9,980
Provision for loan loss 60 75 180 185
----------- ----------- ----------- -----------
Net interest income after provision for loan loss 3,303 3,301 10,101 9,795
Noninterest income 2,418 1,512 4,901 4,586
Noninterest expense 3,135 2,781 9,084 8,369
----------- ----------- ----------- -----------
Income before income taxes 2,586 2,032 5,918 6,012
Income taxes 839 640 2,063 1,923
----------- ----------- ----------- -----------
Net income $ 1,747 $ 1,392 $ 3,855 $ 4,089
=========== =========== =========== ===========
Basic earnings per share $ 1.14 $ 0.90 $ 2.52 $ 2.62
=========== =========== =========== ===========
Diluted earnings per share $ 1.11 $ 0.87 $ 2.45 $ 2.51
=========== =========== =========== ===========
For the Three Months For the Nine Months
Selected Financial Ratios Ended September 30, Ended September 30,
2005 2004 2005 2004
---------------------------------------------------------------------
Performance ratios
Net interest spread 2.75% 3.00% 2.86% 3.02%
Net interest margin 2.96% 3.19% 3.08% 3.23%
Return on average assets 1.44% 1.23% 1.08% 1.23%
Return on average equity 15.85% 13.40% 11.93% 13.10%
Efficiency ratio (noninterest expense divided by
the sum of net interest income before provision
for loan losses plus noninterest income) 54.24% 56.91% 59.83% 57.45%