PRESS RELEASE
FOR IMMEDIATE RELEASE
CONTACT: Mark W. Jaindl (mjaindl@pcbanker.com) Phone: 610-366-1800
--------------------
Chairman, President and Toll-Free: 888-366-6622
Chief Executive Officer Fax: 610-366-1900
American Bank Reports Increase in Third Quarter Earnings
Allentown, PA, October 13, 2005 - American Bank, Inc. (NasdaqSC: AMBK), the
parent company of American Bank, today announced earnings for the quarter ended
September 30, 2005. Net income for the quarter was $728,000, or $0.10 per
diluted share, an increase of $23,000, or 4.0%, from the same period in the
prior year. At the end of the quarter, assets totaled $528 million, up 2.5% from
$515 million at September 30, 2004. Total deposits reached $371 million as of
September 30, 2005, up from $356 million from the same time the previous year.
American Bank's net loans outstanding totaled $288 million as of September 30,
2005, up from $234 million at the same time last year, an increase of $54
million, or 23.1%.
The improvement in third quarter earnings is attributable to an increase of
$17.5 million of average earning assets and an increase of 10 basis points in
the net interest margin in the current quarter compared to the prior year. In
addition to the increase in net interest income, non-interest income increased
$100,000 in the third quarter of 2005 compared to the same quarter in the prior
year. Partially offsetting the improvement in net interest income was an
increase of $90,000 in the provision for loan losses and an increase of $213,000
in operating expense.
Net income for the nine months ended September 30, 2005 was $2,532,000, or $0.33
per diluted share, an increase of $374,000, or 17.3%, from the same period in
the prior year. The improvement in year-to-date earnings is attributable to an
increase of $17.2 million of average earning assets and an increase of 29 basis
points in the net interest margin in the current nine-month period compared to
the nine-month period in 2004. In addition to the increase in net interest
income of $1,007,000, non-interest income increased by $107,000. Partially
offsetting the improvement in net interest income was an increase of $210,000 in
the provision for loan losses, an increase in operating expense of $380,000 and
an increase in taxes on income of $140,000.
American Bank common stock last traded at $8.90 per share. American Capital
Trust I Preferred Securities last traded at $10.25.
About American Bank
- -------------------
American Bank serves the Lehigh Valley community in eastern Pennsylvania and is
recognized as a leading provider of Internet banking and financial services
nationwide. American Bank offers a complete selection of banking services that
includes checking, money market, savings, certificates of deposit, consumer and
commercial loans, free personal online bill payment, credit cards and VISA debit
cards. Pcbanker.com delivers a full range of real-time Internet banking,
insurance and discount brokerage services, while consistently offering some of
the best loan and deposit rates in the United States. American Bank has been
recognized as one of the top Internet banks in the country by Gomez Advisors,
Inc and has received the Bankrate.com(R) Top Tier award for consistently
offering annual percentage yields (APY's) that were among the highest reported.
American Bank is FDIC insured.
American Bank Online and pcbanker.com are registered trademarks for the Internet
financial services provided by American Bank, a state-chartered, FDIC insured
full-service financial institution serving customers throughout the United
States. American Bank is a member of the Federal Reserve System.
Forward-Looking Statements
- --------------------------
Certain statements contained herein are not based on historical facts and are
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such
forward-looking statements may be identified by reference to a future period or
periods, or by the use of forward-looking terminology, such as "may," "will,"
"believe," "expect," "estimate," "anticipate," "continue," or similar terms or
variations on those terms, or the negative of those terms. Forward-looking
statements are subject to numerous risks and uncertainties, including, but not
limited to, those related to the economic environment, particularly in the
market areas in which the Company operates, competitive products and pricing,
fiscal and monetary policies of the U.S. Government, changes in government
regulations affecting financial institutions, including regulatory fees and
capital requirements, changes in prevailing interest rates, risks associated
with the conduct of the Company's business over the internet, credit risk
management, asset-liability management, the financial and securities markets and
the availability of and costs associated with sources of liquidity.
The Company wishes to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. The Company
wishes to advise readers that the factors listed above could affect its
financial performance and could cause the Company's actual results for future
periods to differ materially from any opinions or statements expressed with
respect to future periods in any current statements. The Company does not
undertake and specifically declines any obligation to publicly release the
result of any revisions that may be made to 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.
American Bank, Inc.
Selected Financial Information
(In thousands, except per share data and ratios)
Unaudited
September 30, December 31,
------------- ------------
2005 2004 2004
---- ---- ----
Selected Financial Condition Data:
Total assets............................................. $ 528,499 $ 514,641 $ 503,436
Loans receivable, net.................................... 287,722 234,468 242,348
Allowance for loan losses................................ 3,254 2,689 2,768
Securities available for sale (at fair value)............ 197,260 239,803 220,911
Securities held to maturity (at cost).................... 12,831 13,925 13,480
Deposits................................................. 371,423 355,965 345,732
FHLB advances............................................ 90,875 96,162 96,095
Junior subordinated debentures........................... 10,187 10,187 10,187
Stockholders' equity..................................... 44,557 40,947 41,910
Book value per share..................................... $ 6.00 5.67 5.80
Shares outstanding....................................... 7,470 7,223 7,223
Unaudited Unaudited
For the Three For the Nine
Months Ended Sept. 30, Months Ended Sept. 30,
---------------------- ----------------------
2005 2004 2005 2004
---- ---- ---- ----
Selected Operating Data:
- ------------------------
Total interest income.................................... $ 6,072 $ 5,088 $ 17,849 $ 15,245
Total interest expense................................... 3,658 2,884 10,198 8,601
--------- --------- --------- ---------
Net interest income................................... 2,414 2,204 7,651 6,644
Provision for loan losses................................ 181 91 485 275
--------- --------- --------- ---------
Net interest income after provision for loan losses... 2,233 2,113 7,166 6,369
--------- --------- --------- ---------
Fees and service charges................................. 54 57 156 152
Net realized gain on sales of mortgage loans ............ 58 26 103 92
Net realized gain (loss)on sales of securities .......... (137) - (129) 152
Earnings on bank owned life insurance.................... 87 75 261 225
Other income............................................ 253 57 506 169
--------- --------- --------- ---------
Total non-interest income............................. 315 215 897 790
--------- --------- --------- ---------
Total operating expense.................................. 1,516 1,303 4,437 4,047
--------- --------- --------- ---------
Income before taxes on income......................... 1,032 1,025 3,626 3,112
Taxes on income.......................................... 304 320 1,094 954
--------- --------- --------- ---------
Net income............................................ $ 728 $ 705 $ 2,532 $ 2,158
========= ========= ========= =========
Earnings per share-basic................................. $ 0.10 $ 0.10 $ 0.34 $ 0.30
========= ========= ========= =========
diluted............................... $ 0.10 $ 0.10 $ 0.33 $ 0.29
========= ========= ========= =========
Weighted average shares outstanding-basic................ 7,431 7,207 7,419 7,103
========= ========= ========= =========
-diluted.............. 8,672 8,449 8,659 8,353
========= ========= ========= =========
American Bank, Inc.
Selected Financial Information
Unaudited
For the Three
Months Ended Sept. 30,
2005 2004
---- ----
Performance Ratios(1):
------------------
Return on assets (ratio of net income to
average total assets)............................ 0.55% 0.57%
Return on equity (ratio of net income
to average equity).............................. 6.58% 7.30%
Net interest margin (ratio of net interest income
divided by average earning assets)............... 1.95% 1.85%
Ratio of operating expense to average total assets. 1.16% 1.05%
Efficiency ratio (ratio of operating expenses divided
by net interest income plus non-interest income) 55.55% 53.85%
Asset Quality Ratios:
--------------------
Non-performing assets to total assets at end of period 0.01% 0.03%
Allowance for loan losses to non-performing loans 7,970.88% 1,680.63%
Allowance for loan losses to loans receivable 1.12% 1.18%
Regulatory Capital Ratios-Bank:
Tier I to average assets 8.60% 7.98%
Tier I to risk weighted assets 12.50% 14.35%
Total capital to risk weighted assets 13.50% 15.22%
-------------------------
(1) Ratios for the three month periods are annualized.