EXHIBIT 99
PRESS RELEASE OF AMERICAN BANK INCORPORATED
PRESS RELEASE
FOR IMMEDIATE RELEASE
CONTACT: Mark W. Jaindl (mjaindl@pcbanker.com) Phone: 610-366-1800
Chairman, President and Chief Executive Officer Toll-Free: 888-366-6622
Fax: 610-366-1900
American Bank Reports 20% Increase
in Third Quarter Earnings Per Share
Allentown, PA, October 10, 2006 - American Bank Incorporated (NasdaqSC: AMBK),
the parent company of American Bank, today announced earnings for the quarter
and nine months ended September 30, 2006. Net income for the quarter was
$734,000, or $0.12 per diluted share, an increase of 20.0% from the $0.10 per
diluted share reported in the same period of the prior year. While total
quarterly earnings increased slightly from the prior year, the increase in
earnings per share was positively impacted by the repurchase of approximately
1.56 million shares of common stock since the beginning of 2006. American Bank
currently has approximately 169,000 shares remaining in its previously announced
repurchase program.
American Bank's net loans outstanding totaled $318.3 million as of September 30,
2006, up from $287.7 million at the same time last year, an increase of 10.6%,
or $30.6 million. At the end of the quarter, assets totaled $520.6 million,
which was down from $528.5 million at September 30, 2005. President and CEO Mark
W. Jaindl stated, "In addition to implementing changes aimed at enhancing net
interest margin through increased loan growth, American Bank remains focused on
maintaining strong asset quality as was evidenced by the loan portfolio which
remains strong with less than $190,000 in non-performing loans at the end of the
quarter."
On September 1, 2006, American Bank reported that it could realize a significant
gain on the sale of shares of PSB Bancorp, Inc. if the proposed acquisition of
PSB Bancorp by Conestoga Bancorp, Inc. is completed. American Bank Incorporated
owns 347,643 shares of PSB Bancorp common stock at an average cost per share of
$9.18.
PSB Bancorp, the holding company for First Penn Bank, announced on August 31,
2006 that it has executed a definitive agreement with Conestoga Bancorp for the
sale of PSB Bancorp to Conestoga Bancorp at a price of $17.00 per share, payable
in cash. The price per share payable by Conestoga Bancorp is subject to a
potential maximum downward adjustment of $0.66 per share.
The sale could result in an after-tax gain for American Bank Incorporated of
approximately $1.66 to $1.82 million, or $0.28 to $0.30 per American Bank
Incorporated share, respectively. The transaction is expected to close in the
fourth quarter of 2006 or the first quarter of 2007.
On September 21, 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 October 13, 2006 and payable on October 27, 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 $7.55 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
September 30, December 31,
------------- ------------
2006 2005 2005
Selected Financial Condition Data: ---- ---- ----
- ----------------------------------
Total assets.......................................... $ 520,632 $ 528,499 $ 529,100
Loans receivable, net................................. 318,303 287,722 301,394
Allowance for loan losses............................. 3,712 3,253 3,393
Securities available for sale (at fair value)......... 164,084 197,260 188,691
Securities held to maturity (at cost)................. 13,152 12,831 13,482
Deposits.............................................. 362,966 371,423 368,958
Federal funds purchased............................... 11,000 -- --
FHLB advances......................................... 86,598 90,875 95,048
Junior subordinated debentures........................ 10,187 10,187 10,187
Stockholders' equity.................................. 33,525 44,557 44,345
Book value per share.................................. $ 5.60 5.84 5.97
Shares outstanding.................................... 5,986 7,429 7,424
Unaudited Unaudited
For the Three For the Nine
Months Ended Sept. 30, Months Ended Sept. 30,
---------------------- ----------------------
2006 2005 2006 2005
---- ---- ---- ----
Selected Operating Data:
Total interest income.................................... $ 7,241 $ 6,072 $ 21,002 $ 17,849
Total interest expense................................... 13,568 4,839 3,658 10,198
---------- ---------- ----------- -----------
Net interest income................................... 2,402 2,414 7,434 7,651
Provision for loan losses................................ 61 324 181 485
---------- ---------- ----------- -----------
Net interest income after provision for loan losses... 2,341 2,233 7,110 7,166
---------- ---------- ----------- -----------
Fees and service charges................................. 44 54 144 156
Net realized gain on sales of mortgage loans ............ 14 58 44 103
Net realized gain (loss)on sales of securities........... 4 (137) (79) (129)
Earnings on bank owned life insurance.................... 79 87 253 261
Other income............................................. 65 253 180 506
---------- --------- ----------- -----------
Total non-interest income............................. 206 315 542 897
---------- --------- ----------- -----------
Total operating expense.................................. 1,491 1,516 4,553 4,437
---------- --------- ----------- -----------
Income before taxes on income......................... 1,056 1,032 3,099 3,626
Taxes on income.......................................... 322 304 942 1,094
---------- --------- ----------- -----------
Net income............................................ $ 734 $ 728 $ 2,157 $ 2,532
========== ========= =========== ===========
Earnings per share-basic................................. $ 0.12 $ 0.10 $ 0.34 $ 0.34
========== ========= =========== ===========
diluted................................ $ 0.12 $ 0.10 $ 0.33 $ 0.33
========== ========= =========== ===========
Weighted average shares outstanding-basic................ $ 6,014 $ 7,431 $ 6,298 $ 7,419
========== ========= =========== ===========
diluted................................ 7,243 8,672 7,530 8,659
American Bank, Inc.
Selected Financial Information
Unaudited
For the Three
Months Ended September 30,
--------------------------
2006 2005
---- ----
Performance Ratios(1):
----------------------
Return on assets (ratio of net income to
average total assets) ................................ 0.55% 0.55%
Return on equity (ratio of net income
to average equity)................................... 9.08% 6.58%
Net interest margin (ratio of net interest income
divided by average earning assets).................... 1.89% 1.95%
Ratio of operating expense to average total assets...... 1.13% 1.16%
Efficiency ratio (ratio of operating expenses divided by
net interest income plus non-interest income)......... 57.17% 55.55%
Asset Quality Ratios:
---------------------
Non-performing assets to total assets at end of period.. 0.04% 0.01%
Allowance for loan losses to non-performing loans....... 1968.88% 8132.50%
Allowance for loan losses to loans receivable........... 1.16% 1.12%
Regulatory Capital Ratios-Bank:
-------------------------------
Tier I to average assets................................ 7.89% 8.56%
Tier I to risk weighted assets.......................... 11.14% 12.54%
Total capital to risk weighted assets................... 12.15% 13.48%
_________________________
(1) Ratios for the three month periods are annualized.