Nittany Financial Corp. Subject: 4Q 2002 Earnings
Contact: Samuel J. Malizia, Chairman of the Board
David Z. Richards, Jr., President & CEO
(814) 238-5724
Date: February 7, 2003
FOR IMMEDIATE RELEASE
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Nittany Financial Corp. Announces 294% Increase in 2002 Annual Earnings
State College, PA....Nittany Financial Corp., (the "Company") the holding
company for Nittany Bank, Vantage Investment Advisors, LLC and Nittany Asset
Management Inc. (OTC Bulletin Board Symbol "NTNY"), announced record earnings
for the fourth quarter and full year of 2002.
Fully diluted earnings for the three and twelve month periods ending December
31, 2002 were $300,951 or $0.21 per share, and $886,513 or $0.61 per share,
respectively, compared to $152,341 or $0.13 per share, and $224,989 or $0.19 per
share for the three and twelve month periods ending December 31, 2001. This
resulted in a 98% rise in net income for the quarter and 294% increase for the
twelve months of 2002 compared to 2001. Net interest income before loan loss
provisions were $4,403,657 and $2,254,804 for the twelve months ended December
31, 2002 and December 31, 2001, respectively, a 95% increase.
The earnings gains were primarily attributable to the continued strong growth in
all lines of business for the Company. Net loans grew for the twelve months
ending December 31, 2002 by $50,467,000, a 68% increase. The loan growth in 2002
was funded by a $58,331,000 or 59% increase in deposits. The Company also paid
off $5,400,000 in Federal Home Loan Bank borrowings during the fourth quarter of
2002. The deposit increases occurred in core checking, savings and money market
deposits.
Total assets for the consolidated entity at December 31, 2002 were $179,659,000
compared to $124,782,000 twelve months earlier at December 31, 2001.
Chairman of the Board Samuel J. Malizia commented, "The quality of the Nittany
staff continues to be a key ingredient in the success of the Company. Customers
are responding to the highest yielding checking and savings accounts in the
area, along with our superior service by moving their deposits and loans to
Nittany Bank at record levels. We are constantly striving to enhance our
convenience and service. The new office announced on South Atherton Street at
the location vacated by Shoney's Restaurant will be another step towards that
goal."
President and CEO, David Richards added, "The fourth quarter of 2002 was an
important period in the history of this Company. Our earnings momentum reflected
our significant investments in people, technology and new offices over the past
four years. In addition, we recently purchased Vantage Investment Advisors, LLC
and continue to believe that our product offerings, experienced staff, and
recent investments, position us well in a growing and vibrant community"
Richards also noted the following highlights during the fourth quarter of 2002:
o The Company announced the purchase of Vantage Investment
Advisors, LLC. The asset management entity with over $150 million
under management provides fee based investment management to
company pension plans and individuals. Vantage recently moved
into the second floor at the Nittany Bank Financial Center at
2541 East College Ave., where it is readily accessible for new
and existing customers.
o The Company negotiated a long term lease on the property vacated
by Shoney's Restaurant at 1900 South Atherton St. The Bank will
move its office at Rolling Ridge Drive to the new location in
approximately June, 2003.
o At year end, only one loan was past due over 90 days, which
represented 0.13% of total loans. Portfolio credit quality
continues to be excellent and among the best in the industry. The
loan loss provision of the fourth quarter of 2002 was $133,000
bringing the total allowance to 0.94% of total loans at 12/31/02.
o Demand for the Company's stock, ticker symbol NTNY on the OTCBB,
remained steady during a turbulent market. The Company recently
announced a 6 for 5 stock split, payable in the form of a 20%
stock dividend for shareholders of record on January 31, 2003 and
payable February 15, 2003.
o Usage of the Bank's website, www.NittanyBank.com reached record
levels. Over 2,000 customers are using the internet banking
functions and online bill payment service.
Nittany Financial Corp. (OTC Ticker Symbol "NTNY") is the parent company for
Nittany Bank, a federally chartered financial institution headquartered and
operated solely in the State College market with $180 million in assets. Nittany
Bank began operations in October, 1998 and currently operates four offices with
40 employees. Nittany Bank offers a full range of financial services through its
four offices, five ATM's, telephone banking (814-231-1800) and transactional
internet banking at its www.NittanyBank.com site.
The parent company, Nittany Financial Corp., also owns two investment
subsidiaries. Nittany Asset Management Inc. offers retail investment products
through the bank's four offices. Vantage Investment Advisors, LLC is a
Registered Investment Advisory firm providing fee based investment management
services. Vantage currently manages approximately $150 million in investments
for small business retirement plans as well as individual portfolio management
for consumers.
NITTANY FINANCIAL CORP.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
December 31,
2002 2001
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ASSETS
Cash and due from banks $ 618,937 $ 359,187
Interest-bearing deposits with other banks 5,233,136 5,753,971
Investment securities available for sale 6,024,009 13,188,065
Investment securities held to maturity (estimated
market value of $38,727,563 and $27,789,824) 38,359,925 27,796,205
Loans receivable (net of allowance for loan losses
of $1,177,141 and $649,565) 124,254,560 73,787,410
Premises and equipment 1,941,009 1,344,262
Federal Home Loan Bank stock 1,175,400 710,700
Intangible assets 799,217 799,217
Accrued interest and other assets 1,252,839 1,043,117
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TOTAL ASSETS $179,659,032 $124,782,134
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LIABILITIES
Deposits:
Noninterest-bearing demand $ 6,159,204 $ 4,094,714
Interest-bearing demand 18,717,951 14,802,415
Money market 27,517,955 13,827,084
Savings 86,498,462 46,600,107
Time 17,958,397 19,196,916
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Total deposits 156,851,969 98,521,236
Short-term borrowings 1,141,104 8,714,554
Other borrowings 10,615,650 7,813,775
Accrued interest payable and other liabilities 1,143,985 770,753
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TOTAL LIABILITIES 169,752,708 115,820,318
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TOTAL STOCKHOLDERS' EQUITY 9,906,324 8,961,816
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $179,659,032 $124,782,134
============ ============
Per share data is being presented based upon the retroactive effect of a
stock dividend payable on February 15, 2003.
NITTANY FINANCIAL CORP.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
Year Ended December 31, Three Months Ended December 31,
2002 2001 2002 2001
----------- ----------- ----------- -----------
INTEREST AND DIVIDEND INCOME
Loans, including fees $ 7,020,575 $ 4,355,806 $ 2,070,924 $ 1,295,669
Interest-bearing deposits with other banks 132,997 297,961 24,761 36,235
Investment securities 1,742,704 1,208,035 438,811 393,752
----------- ----------- ----------- -----------
Total interest and dividend income 8,896,276 5,861,802 2,534,496 1,725,656
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INTEREST EXPENSE
Deposits 3,824,151 3,075,634 1,034,732 826,854
Short-term borrowings 198,191 152,502 44,858 98,701
Other borrowings 470,277 378,862 129,401 28,530
----------- ----------- ----------- -----------
Total interest expense 4,492,619 3,606,998 1,208,991 954,085
----------- ----------- ----------- -----------
NET INTEREST INCOME 4,403,657 2,254,804 1,325,505 771,571
Provision for loan losses 543,000 320,500 133,000 142,000
----------- ----------- ----------- -----------
NET INTEREST INCOME AFTER PROVISION FOR
LOAN LOSSES 3,860,657 1,934,304 1,192,505 629,571
----------- ----------- ----------- -----------
NONINTEREST INCOME
Service fees on deposit accounts 468,644 347,971 135,608 97,728
Investment security gain 7,450 21,487 (180) -
Other 119,776 92,269 21,046 22,119
----------- ----------- ----------- -----------
Total noninterest income 595,870 461,727 156,474 119,847
----------- ----------- ----------- -----------
NONINTEREST EXPENSE
Compensation and employee benefits 1,569,018 1,035,192 414,994 300,028
Occupancy and equipment 503,213 353,703 130,123 98,989
Other 1,086,034 782,147 323,911 198,560
----------- ----------- ----------- -----------
Total noninterest expense 3,158,265 2,171,042 869,028 597,577
----------- ----------- ----------- -----------
Income before income taxes 1,298,262 224,989 479,951 151,841
Income taxes 411,749 - 179,000 (500)
----------- ----------- ----------- -----------
NET INCOME $ 886,513 $ 224,989 $ 300,951 $ 152,341
=========== =========== =========== ===========
EARNINGS PER SHARE
Basic $ 0.65 $ 0.20 $ 0.22 $ 0.13
Diluted 0.61 0.19 0.21 0.13
Per share data is being presented based upon the retroactive effect of a
stock dividend payable on February 15, 2003.