SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): January 23, 2004
PROVIDENT BANCORP, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-25233 80-0091851
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(State or Other Jurisdiction) (Commission File No.) (I.R.S. Employer
of Incorporation) Identification No.)
400 Rella Boulevard, Montebello, New York 10901
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (845) 369-8040
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Not Applicable
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(Former name or former address, if changed since last report)
Item 7. Financial Statements, Pro Forma Financial Information, and Exhibits
The Index of Exhibits immediately precedes the attached exhibits.
Item 12. Results of Operations and Financial Condition
On January 23, 2004, the Company issued a press release regarding its
earnings for the fiscal quarter ended December 31, 2003. The press release is
included as Exhibit 99 to this report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
PROVIDENT BANCORP, INC.
DATE: January 23, 2004 By: /s/ Paul A. Maisch
-----------------------------------
Paul A. Maisch
Senior Vice President and
Chief Financial Officer
EXHIBIT INDEX
The following exhibits are filed as part of this report:
Exhibit No. Description
99 Press Release of Provident Bancorp, Inc.
EXHIBIT 99
PRESS RELEASE OF PROVIDENT BANCORP, INC.
NEWS RELEASE
FOR IMMEDIATE RELEASE Stock Symbol: PBCPD Thru February 12, 2004
Friday, January 23, 2004 Traded on Nasdaq National Market
CONTACT:
Paul A. Maisch, SVP & Chief Financial Officer
Roberta Lenett, VP & Manager of Shareholder Relations
(845) 369-8082
PROVIDENT BANCORP ANNOUNCES QUARTERLY EARNINGS
OF $3.0 MILLION, $0.39 PER DILUTED SHARE
DECLARES QUARTERLY DIVIDEND OF $0.035
MONTEBELLO, NEW YORK - January 23, 2004 -- Provident Bancorp, Inc.
(Nasdaq-National Market: PBCPD), the parent company of Provident Bank, today
announced that net income for the three months ended December 31, 2003 was $3.0
million, the same as net income for the three months ended December 31, 2002.
Basic and diluted earnings per share were $0.39, respectively, for the three
months ended December 31, 2003 and December 31, 2002. On January 14, 2004, the
Company completed its second-step conversion. As a result of the conversion,
existing shareholders received 4.4323 shares for each share of existing
Provident Bancorp stock. On a converted basis, basic and diluted earnings per
share were $0.09, respectively, for both the three months ended December 31,
2003 and December 31, 2002.
The Company also announced that the Board of Directors has declared a quarterly
cash dividend of $0.035 per share. The dividend is payable February 19, 2004, to
holders of record as of February 5, 2004.
George Strayton, the Company's President and CEO, commented, "We are reporting
quarterly earnings comparable to last year, despite the continued low interest
rate environment and the task of completing our second-step conversion and
acquisition of ENB Holding Company, Inc. We completed the transition to a fully
public company on January 14, 2004 and closed at the super maximum of the
offering with over $200 million in subscriptions received. We welcome our new
shareholders and will continue to strive for strong returns in the future.
Although we have completed the merger, we are still in the process of
integrating systems, people and product lines. We expect integration to continue
through the second and third quarters of fiscal 2004. I am also pleased that
depositors and shareholders approved the establishment of the Provident Bank
Charitable Foundation. We contributed 400,000 shares of Provident Bancorp stock
along with $1.0 million in cash to the foundation and will be taking the charge
in the second quarter together with other integration costs in connection with
ENB Holding Company, Inc. Pending full deployment of the proceeds of the
offering, we have invested the proceeds in investment and mortgage-backed
securities with relatively short weighted average lives, which will reduce our
net interest margin in the short term. We remain vigilant in seeking
opportunities to improve returns on these new funds in a prudent manner."
<page>
The Company's total assets increased to $1.3 billion, an increase of $127.6
million over the $1.2 billion at September 30, 2003 as the Company received
$174.7 million in funds for stock subscriptions and reduced borrowings by $51.1
million. During the quarter, total securities increased by $110.5 million, while
cash and cash equivalents increased by $21.8 million. Net loans (excluding loans
held for sale) increased during the quarter by $1.5 million although commercial
real estate, business and construction loan growth of $12.2 million was mostly
offset by a decline in one-to-four family mortgages of $11.1 million. Deposits
of $870.2 million were virtually unchanged at December 31, 2003 compared to
September 30, 2003, as growth of $3.4 million in transaction accounts and $15.6
million in savings and money market accounts offset declines in certificates of
deposit of $18.4 million. Stockholders equity increased $1.7 million to $119.5
million during the quarter.
Net interest income declined $84,000, as declines in interest on loans of
$816,000 more than offset declines in interest expense of $622,000. In this
continued low interest rate environment asset yields have fallen faster than
deposit costs and the increases in both loan and security outstandings have been
insufficient to completely offset the fall in asset yields. Net interest margin
for the quarter ended December 31, 2003 was 4.20% compared to 4.73% for the
quarter ended December 31, 2002.
Non-interest income increased for the three months ended December 31, 2003
compared to the same period a year ago, totaling $2.8 million in 2003 compared
to $2.0 million in 2002. Banking fees and service charges grew $295,000, or
27.1%, to $1.4 million and gains on sales of securities increased $273,000, or
41.6%, to $930,000 in the three months ended December 31, 2003 compared to the
same period in the prior year.
Non-interest expense increased $1.1 million to $9.6 million or an increase of
12.9% for the quarter ended December 31, 2003 compared to a year ago. An
increase in compensation and benefits expense of $703,000 to $4.9 million and
occupancy and office operations expense increases of $195,000 to $1.3 million
were the primary areas of note.
Pre-tax income was $4.6 million for the three months ended December 31, 2003
compared to $4.9 million for the same period a year ago. Income tax expense was
$1.6 million for the three months ended December 31, 2003, down $235,000 from
the same period in 2002. The Company's effective tax rates were 34.3% in 2003
and 37.5% in 2002.
ENB Holding Company, Inc. had approximately $361 million in assets, $217 million
in net loans and $325 million in deposits as of December 31, 2003. However, this
information is not reflected in the Company's December 31, 2003 financial
information.
Other financial information is included in the tables that follow.
Note:
In addition to historical information, this earnings release may contain
forward-looking statements. For this purpose, any statements contained herein
that are not statements of historical fact may be deemed to be forward-looking
statements. There are a number of important factors which have been outlined in
previously filed documents with the Securities and Exchange Commission, and
other factors that could cause the Company's actual results to differ materially
from those contemplated by such forward-looking statements. The Company
undertakes no obligation to publicly release the results of any revisions to
those forward-looking statements which may be made to reflect events or
circumstances after the date of this release or to reflect the occurrence of
unanticipated events.
Provident Bancorp, Inc.
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION
(unaudited, in thousands, except share data)
December 31, September 30, December 31,
2003 2003 2002
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Assets:
Cash and due from banks $ 40,331 $ 33,500 $ 35,510
Federal funds sold 15,000
Total securities 484,801 374,259 289,371
Loans held for sale 727 2,364 8,138
Loans:
One-to four-family residential mortgage loans 369,676 380,776 378,084
Commercial real estate, commercial business
and construction 265,043 252,857 223,904
loans
Consumer loans 81,193 80,620 83,221
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Gross loans 715,912 714,253 685,209
Allowance for loan losses (11,249) (11,069) (10,687)
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Total loans, net 704,663 703,184 674,522
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Federal Home Loan Bank stock, at cost 5,665 8,220 5,871
Premises and equipment, net 11,465 11,647 11,167
Goodwill 13,540 13,540 13,540
Bank owned life insurance 12,641 12,483 12,000
Other assets 13,045 15,108 8,029
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Total assets $ 1,301,878 $ 1,174,305 $ 1,058,148
================== ======================= =================
Liabilities:
Deposits:
Transaction accounts $ 228,823 $ 225,376 $ 202,023
Savings and money market deposits 423,514 407,939 372,029
Certificates of deposit 217,832 236,238 247,665
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Total deposits 870,169 869,553 821,717
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Stock Subscriptions 174,660 --- ---
Borrowings 113,653 164,757 104,009
Mortgage escrow funds and other 23,866 22,138 19,351
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Total liabilities 1,182,348 1,056,448 945,077
Stockholders' equity 119,530 117,857 113,071
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Total liabilities and stockholders' equity $ 1,301,878 $ 1,174,305 $ 1,058,148
================== ======================= =================
Common shares outstanding at period end 7,947,321 7,946,521 7,997,512
Book value per share $ 15.04 $ 14.83 $ 14.14
Provident Bancorp, Inc.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands, except share data)
Three Months Ended
December 31
2003 2002
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Interest and dividend income:
Loans $ 10,530 $ 11,346
Securities 3,765 3,595
Other earning assets 23 83
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Total interest and dividend income 14,318 15,024
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Interest expense:
Deposits 1,557 2,345
Borrowings 1,210 1,044
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Total interest expense 2,767 3,389
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Net interest income 11,551 11,635
Provision for loan losses 150 300
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Net interest income after provision for loan losses 11,401 11,335
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Non-interest income:
Banking fees and service charges 1,384 1,089
Gains on securities available for sale sold 930 657
Gains on sales of loans 86 39
Other 403 218
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Total non-interest income 2,803 2,003
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Non-interest expense:
Compensation and employee benefits 4,919 4,216
Occupancy and office operations 1,327 1,132
Advertising and promotion 468 416
Professional fees 417 348
Data and check processing 744 696
Amortization of intangible assets 84 127
Other 1,611 1,538
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Total non-interest expense 9,570 8,473
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Income before income tax expense 4,634 4,865
Income tax expense 1,589 1,824
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Net income $ 3,045 $ 3,041
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Per common share:
Basic earnings $0.39 $0.39
Diluted earnings 0.39 0.39
Dividends declared 0.15 0.13
Weighted average common shares:
Basic 7,738,931 7,721,560
Diluted 7,883,872 7,858,438
Provident Bancorp, Inc.
SELECTED ADDITIONAL FINANCIAL DATA
(unaudited, $ in thousands)
December 31, September 30, December 31,
2003 2003 2002
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Asset Quality Data:
Non-performing loans (NPLs) $ 4,988 $ 4,697 $ 5,356
Non-performing assets (NPAs) $ 4,988 $ 4,697 $ 5,397
NPLs as % of total loans 0.70% 0.66% 0.77%
NPAs as % of total assets 0.38% 0.40% 0.51%
Allowance for loan losses as % of NPLs 226% 236% 200%
Allowance for loan losses as % of total loans 1.6% 1.6% 1.5%
Capital Ratios:
Equity to total assets (consolidated) 9.18% 10.04% 10.69%
Tier 1 capital ratio (Bank only) 7.60% 8.14% 8.49%
Three Months Ended
December 31,
2003 2002
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Performance Ratios (annualized):
Return on:
Average assets 1.02% 1.16%
Average common equity 10.30% 10.81%
Average yield on earning assets 5.21% 6.11%
Average cost of interest-bearing liabilities 1.28% 1.67%
Net interest rate spread 3.93% 4.44%
Net interest margin 4.20% 4.73%
Average Balance Data:
Average assets $1,181,863 $1,039,812
Average earning assets 1,092,953 975,064
Average interest-bearing liabilities 860,511 805,007
Average stockholders' equity 117,632 111,581