Nittany Financial Corp. Subject: 2nd Qtr 2004 Earnings
Contact: Samuel J. Malizia, Chairman of the Board
David Z. Richards, Jr., President & CEO
(814) 238-5724
Date: August 9, 2004
FOR IMMEDIATE RELEASE
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NITTANY FINANCIAL CORP. ANNOUNCES
AN INCREASE IN SECOND QUARTER EARNINGS AND ASSETS
State College, PA....Nittany Financial Corp., (the "Company") (OTC Bulletin
Board Symbol "NTNY") the holding company for Nittany Bank, Vantage Investment
Advisors, LLC and Nittany Asset Management Inc., today announced second quarter
2004 earnings.
Fully diluted earnings for the three-month period ending June 30, 2004 were
$637,900 or $0.31 per share, compared to $355,600 or $0.19 per share for the
three month period ending June 30, 2003, a 79% increase. Net interest income for
the three months ended June 30, 2004 was $2,085,800 compared to $1,492,600 for
the same period ending June 30, 2003, a $593,200 or 40% rise. The increase
resulted from the continued loan and deposit growth and the net interest margin
which remained steady at approximately 3.00%. Non-interest income grew to
$811,300 for the 2004 quarter from $355,000 for the same time period in 2003,
due to the increase in Vantage Investment Advisors, LLC assets under management
and service fees on deposit accounts at Nittany Bank.
"The steady growth in the number of accounts at Nittany Bank and Vantage, plus
our ability to fund loans with core deposits, allows Nittany Financial to
continue to prosper," commented Samuel J. Malizia, Chairman of the Board for
Nittany Financial Corp. Malizia added, "We believe that focusing on our core
strategies and superior customer service within our single market is the best
way to be successful in a highly competitive environment. We plan to continue to
expand such operations with the opening of our fifth office in Bellefonte in
late 2004 or early 2005."
The balance sheet for the Company also showed strong growth in year 2004 and
excellent credit quality. Total assets for the consolidated entity were
$278,098,300 on June 30, 2004, compared to $248,587,300 at December 31, 2003, an
12% increase. Total deposits grew by 10% over the same time period, with the
Company's core Nittany Savings account providing the majority of the increase
with growth of 12%. Total net loans grew by 17% to $213,606,800 for the six
month period ending June 30, 2004. Non-performing loans over 90 days delinquent
were only $86,700 or 0.04% of the total loan portfolio at June 30, 2004.
President and CEO David Richards added, "Continued strong loan and deposit
growth without compromising our excellent credit quality is creating value for
our shareholders. We have been fortunate to combine an intimate knowledge of our
market and customer needs, in concert with a highly motivated and professional
staff at Nittany Bank. This combination is producing significant gains and
franchise value. Customers want the best people, products and technology. The
addition of an instant live help feature on our website recently is one small
example of our ongoing effort to deliver better banking and separate ourselves
from the competition."
Nittany Financial Corp. (OTC Ticker Symbol "NTNY") is the parent company for
Nittany Bank, a federally chartered financial institution headquartered and
operated in State College, Pennsylvania. Nittany Bank began operations in
October, 1998 and currently operates four offices with 53 full time equivalent
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 website.
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 $245 million in investments
for small business retirement plans as well as individual portfolio management
for consumers.
The foregoing material contains forward-looking statements concerning the
financial condition, results of operations and business of the Company. We
caution that such statements are subject to a number of uncertainties and actual
results could differ materially and, therefore, readers should not place undue
reliance on any forward-looking statements. The Company does not undertake, and
specifically disclaims, any obligation to publicly release the results of any
revisions that may be made to any forward-looking statements to reflect the
occurrence of anticipated or unanticipated events or circumstances after the
date of such statements.
NITTANY FINANCIAL CORP.
CONSOLIDATED BALANCE SHEET
June 30, December 31,
2004 2003
------------------ -----------------
(unaudited)
ASSETS
Cash and due from banks $ 8,665,074 $ 805,812
Interest-bearing deposits with other banks 3,449,006 14,147,474
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Cash and cash equivalents 12,114,080 14,953,286
Investment securities available for sale 2,468,431 4,074,095
Investment securities held to maturity (estimated
market value of $41,309,945 and $39,168,895) 41,913,421 39,246,289
Loans receivable (net of allowance for loan losses
of $1,984,680 and $1,737,475) 213,606,805 182,742,537
Premises and equipment 2,521,636 2,570,953
Federal Home Loan Bank stock 1,724,000 1,311,300
Intangible assets 1,763,231 1,763,231
Accrued interest and other assets 1,986,734 1,925,622
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TOTAL ASSETS $ 278,098,338 $ 248,587,313
================== =================
LIABILITIES
Deposits:
Noninterest-bearing demand $ 11,843,397 $ 7,880,177
Interest-bearing demand 24,321,562 21,902,355
Money market 35,341,260 34,237,951
Savings 152,444,179 136,273,936
Time 19,164,271 20,598,238
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Total deposits 243,114,669 220,892,657
Short-term borrowings 7,045,632 2,363,887
Other borrowings 11,069,475 9,829,866
Accrued interest payable and other liabilities 911,566 673,159
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TOTAL LIABILITIES 262,141,342 233,759,569
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STOCKHOLDERS' EQUITY
Serial preferred stock, no par value; 5,000,000 shares
authorized, none issued - -
Common stock, $.10 par value; 10,000,000 shares
authorized, 1,924,621 and 1,603,960 issued and outstanding 192,462 160,396
Additional paid-in capital 14,287,483 14,323,021
Retained earnings 1,490,267 356,344
Accumulated other comprehensive loss (13,216) (12,017)
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TOTAL STOCKHOLDERS' EQUITY 15,956,996 14,827,744
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 278,098,338 $ 248,587,313
================== =================
NITTANY FINANCIAL CORP.
CONSOLIDATED STATEMENT OF INCOME
Three Months Ended June 30, Six Months Ended June 30,
2004 2003 2004 2003
------------------- ------------------- ------------------ ------------------
(unaudited) (unaudited)
INTEREST AND DIVIDEND INCOME
Loans, including fees $ 3,009,369 $ 2,302,577 $ 5,767,209 $ 4,410,790
Interest-bearing deposits with other banks 9,840 13,037 25,206 39,905
Investment securities 351,957 377,023 743,016 746,334
------------------- ------------------- ------------------ ------------------
Total interest and dividend income 3,371,166 2,692,637 6,535,431 5,197,029
------------------- ------------------- ------------------ ------------------
INTEREST EXPENSE
Deposits 1,146,837 1,056,983 2,306,537 2,119,605
Short-term borrowings 18,033 12,878 24,014 24,988
Other borrowings 120,504 130,218 258,196 261,641
------------------- ------------------- ------------------ ------------------
Total interest expense 1,285,374 1,200,079 2,588,747 2,406,234
------------------- ------------------- ------------------ ------------------
NET INTEREST INCOME 2,085,792 1,492,558 3,946,684 2,790,795
Provision for loan losses 194,000 188,000 304,000 278,000
------------------- ------------------- ------------------ ------------------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 1,891,792 1,304,558 3,642,684 2,512,795
------------------- ------------------- ------------------ ------------------
NONINTEREST INCOME
Service fees on deposit accounts 174,307 126,632 320,368 245,457
Investment security gain - - - 6,691
Asset management fees and commissions 592,471 150,526 1,159,216 489,670
Other 44,536 77,851 54,666 86,945
------------------- ------------------- ------------------ ------------------
Total noninterest income 811,314 355,009 1,534,250 828,763
------------------- ------------------- ------------------ ------------------
NONINTEREST EXPENSE
Compensation and employee benefits 745,230 544,386 1,437,995 1,063,112
Occupancy and equipment 177,793 148,245 354,129 293,221
Professional fees 51,349 53,725 94,798 101,749
Data processing fees 111,164 95,608 230,171 173,261
Supplies, printing, and postage 31,938 31,518 64,931 68,675
Advertising 37,723 24,442 78,128 61,792
ATM processing fees 34,982 30,322 69,853 62,622
Commission expense 361,331 77,298 738,837 295,123
Other 174,724 109,331 340,169 218,472
------------------- ------------------- ------------------ ------------------
Total noninterest expense 1,726,234 1,114,875 3,409,011 2,338,027
------------------- ------------------- ------------------ ------------------
Income before income taxes 976,872 544,692 1,767,923 1,003,531
Income taxes 339,000 189,089 634,000 348,699
------------------- ------------------- ------------------ ------------------
NET INCOME $ 637,872 $ 355,603 $ 1,133,923 $ 654,832
=================== =================== ================== ==================
EARNINGS PER SHARE
Basic $ 0.33 $ 0.21 $ 0.59 $ 0.39
Diluted 0.31 0.19 0.55 0.36
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 1,924,621 1,690,139 1,924,621 1,686,784
Diluted 2,080,803 1,835,168 2,077,516 1,832,813