PRESS RELEASE
FOR IMMEDIATE RELEASE
CONTACT: Mark W. Jaindl (mjaindl@pcbanker.com) Phone: 610-366-1800
-------------------- Toll-Free: 888-366-6622
Chairman, President and Chief
Executive Officer Fax: 610-366-1900
American Bank Reports Second Quarter Earnings
Allentown, PA, July 19, 2006 - American Bank Incorporated (NasdaqSC: AMBK), the
parent company of American Bank, today announced earnings for the quarter and
six months ended June 30, 2006. Net income for the quarter was $685,000, or
$0.11 per diluted share, which was equal to the $0.11 per diluted share in the
same period in the prior year. American Bank's net loans outstanding totaled
$315 million as of June 30, 2006, up from $272 million at the same time last
year, an increase of 15.8%, or $43 million. At the end of the quarter, assets
totaled $533 million, up 2.3% from $521 million at June 30, 2005. Total deposits
were $371 million as of June 30, 2006, up from $358 million from the same time
the previous year.
President and CEO Mark Jaindl stated, "One of the biggest challenges facing the
banking industry today is the flat yield curve, which has a negative impact on
net interest margin. To enhance net interest margin, we will continue to
increase the level of higher yielding assets through the development of our loan
portfolio. While we have increased our loan portfolio by 15.8% during the last
year, the quality of the portfolio remains strong."
On June 20, 2006, the Board of Directors of American Bank declared a quarterly
dividend of $0.04 per share of common stock to shareholders of record on July
14, 2006 and payable on July 28, 2006. In addition, the Board approved the
continuance of the reinvestment of dividends by shareholders to purchase
additional shares of American Bank Inc. common stock at a 5% discount to the
average of the closing "bid" and "ask" price on the Record Date.
American Bank common stock last traded at $7.83 per share. American Bank Trust
Preferred Securities last traded at $9.25.
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 received
the Bankrate.com(R) Top Tier award for consistently offering annual percentage
yields (APYs) 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
June 30, December 31,
-------- ------------
2006 2005 2005
---- ---- ----
Selected Financial Condition Data:
- ----------------------------------
Total assets...............................................$ 533,270 $ 520,842 $ 529,100
Loans receivable, net....................................... 315,417 271,770 301,394
Allowance for loan losses................................... 3,656 3,072 3,393
Securities available for sale (at fair value)............... 175,686 210,592 188,691
Securities held to maturity (at cost)....................... 14,139 13,117 13,482
Deposits.................................................... 370,693 358,411 368,958
FHLB advances............................................... 106,892 95,959 95,048
Junior subordinated debentures.............................. 10,187 10,187 10,187
Stockholders' equity........................................ 31,463 43,899 44,345
Book value per share.......................................$ 5.31 $ 5.84 $ 5.97
Shares outstanding.......................................... 6,055 7,478 7,424
Unaudited Unaudited
For the Three For the Six
Months Ended June 30, Months Ended June 30,
--------------------- ---------------------
2006 2005 2006 2005
---- ---- ---- ----
Selected Operating Data:
- ------------------------
Total interest income..........................................$ 6,959 $ 6,019 $ 13,761 $ 11,777
Total interest expense......................................... 4,540 3,414 8,729 6,540
--------- -------- ---------- ---------
Net interest income......................................... 2,419 2,605 5,032 5,237
Provision for loan losses...................................... 135 168 336 304
--------- -------- ---------- ---------
Net interest income after provision for loan losses........ 2,284 2,437 4,769 4,933
--------- -------- ---------- ---------
Fees and service charges...................................... 49 49 100 102
Net realized gain on sales of mortgage loans ................. 20 21 30 45
Net realized gain (loss) on sales of securities .............. 7 (1) (83) 8
Earnings on bank owned life insurance......................... 87 87 174 174
Other income.................................................. 56 112 115 253
--------- -------- ---------- ---------
Total non-interest income.................................. 219 268 336 582
--------- -------- ---------- ---------
Total operating expense....................................... 1,523 1,529 3,062 2,921
--------- -------- ---------- ---------
Income before taxes on income.............................. 980 1,196 2,043 2,594
Taxes on income............................................... 295 354 620 790
--------- -------- ---------- ---------
Net income.................................................$ 685 $ 842 $ 1,423 $ 1,804
========== ======== ========== =========
Earnings per share-basic......................................$ 0.11 $ 0.11 $ 0.22 $ 0.24
========== ======== ========== =========
-diluted....................................$ 0.11 $ 0.11 $ 0.21 $ 0.23
========== ======== ========== =========
Weighted average shares outstanding-basic..................... 6,054 7,480 6,445 7,413
========== ======== ========== =========
-diluted................... 7,287 8,720 7,678 8,653
========== ======== ========== =========
American Bank, Inc.
Selected Financial Information
Unaudited
For the Three
Months Ended June 30,
2006 2005
---- ----
Performance Ratios(1):
------------------
Return on assets (ratio of net income to
average total assets)..................... 0.52% 0.65%
Return on equity (ratio of net income
to average equity)....................... 8.59% 7.66%
Net interest margin (ratio of net interest income
divided by average earning assets)........ 1.92% 2.08%
Ratio of operating expense to average total assets. 1.15% 1.16%
Efficiency ratio (ratio of operating expenses divided
by net interest income plus non-interest income) 57.73% 52.49%
Asset Quality Ratios:
--------------------
Non-performing assets to total assets at end of
period 0.01% 0.01%
Allowance for loan losses to non-performing loans 9383.33% 7475.82%
Allowance for loan losses to loans receivable 1.12% 1.12%
Regulatory Capital Ratios-Bank:
------------------------------
Tier I to average assets 8.00% 8.40%
Tier I to risk weighted assets 11.30% 12.52%
Total capital to risk weighted assets 12.30% 13.43%
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(1) Ratios for the three month periods are annualized.