FOR IMMEDIATE RELEASE
January 26, 2005
For further information contact:
Ralph A. Fernandez
Senior Vice President and Chief Financial Officer
Synergy Financial Group, Inc.
(800) 693-3838, extension 3292
Synergy Financial Group, Inc. Announces Stock Repurchase
Plan and Annual and Fourth Quarter, 2004 Earnings
Cranford, New Jersey, January 26, 2005 - John S. Fiore, President and Chief
Executive Officer of Synergy Financial Group, Inc. (NASDAQ: SYNF) (the
"Company"), the holding company of Synergy Bank and Synergy Financial Services,
Inc., announced today that the Company intends to purchase up to 5% of its
outstanding shares of common stock (approximately 622,600 shares) in open market
transactions. Such purchases will be made from time to time in the market, based
on stock availability, price and the Company's financial performance. It is
anticipated that purchases will be made during the next twelve months, although
no assurance can be given as to when they will be made or to the total number of
shares that will be purchased.
The Company previously announced that it had completed purchases of 211,031
shares of common stock in open market transactions in association with its 2003
Restricted Stock Plan. It has also completed open market purchases of more than
75% of the 281,436 shares of common stock that it intends to purchase for use by
its 2004 Restricted Stock Plan.
Mr. Fiore also announced net income for the year ended December 31, 2004 of $4.2
million, or $0.38 per basic and $0.37 per diluted share, based on weighted
average basic and diluted shares of 11,009,038 and 11,275,680, respectively.
This represents an increase of $792,200, or 23.2 percent, from $3.4 million, or
$1.05 per basic and diluted share, for the prior year, based on weighted average
basic and diluted shares of 3,234,878 and 3,259,896, respectively. Net income
for the three months ended December 31, 2004 was $1.2 million, an increase of
$84,500, or 7.6 percent, from $1.1 million for the same period a
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year ago. Per share data for 2003 and 2004 are dissimilar, as the Company did
not complete its second-step conversion from the mutual holding company form of
organization to a full stock corporation until January 20, 2004.
Total assets reached $860.7 million on December 31, 2004, an increase of 36.9
percent, or $232.1 million, from $628.6 million on December 31, 2003. Net loans
increased 29.3 percent, or $127.1 million, to $561.7 million on December 31,
2004, from $434.6 million on December 31, 2003. On December 31, 2004, total
loans were comprised of 28.2 percent in non-residential and multi-family
mortgage loans, 26.5 percent in consumer loans, 23.0 percent in single-family
real estate loans, 20.1 percent in home equity loans, and 2.2 percent in
commercial and industrial loans. At the end of the second quarter of 2004,
Synergy Bank expanded its lending product line to include commercial and
industrial loans via the addition of two experienced lenders who were previously
employed by a local commercial bank. As a result, the Company expects to
experience an increase in this loan category in future periods.
On December 31, 2004, the allowance for loan and lease losses was $4.4 million,
or 0.78 percent of total loans, compared to $3.3 million, or 0.75 percent of
total loans, on December 31, 2003. Non-performing assets of $264,400 represented
0.03 percent of total assets on December 31, 2004, down from $348,200, or 0.06
percent of total assets, on December 31, 2003.
Between December 31, 2003 and December 31, 2004, investment securities increased
$87.9 million, or 56.0 percent, from $157.0 million to $244.9 million. The
increase was primarily the result of investing the net capital received of $69.2
million from the Company's second-step stock offering that was completed on
January 20, 2004.
Deposits reached $538.9 million on December 31, 2004, an increase of $65.4
million, or 13.8 percent, from the $473.5 million reported on December 31, 2003.
Core deposits, consisting of checking, savings, and money market accounts,
represented 53.1 percent of
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total deposits on December 31, 2004. During the same period, borrowings
increased $139.5 million, or 191.5 percent, to $212.4 million on December 31,
2004.
Stockholders' equity totaled $104.0 million on December 31, 2004, an increase of
154.2 percent, or $63.1 million, from $40.9 million on December 31, 2003. As
stated above, the Company raised net capital of $69.2 million via a second-step
stock offering that was completed on January 20, 2004. On December 22, 2004, the
Company's Board of Directors declared a quarterly cash dividend of $0.04 per
common share, consistent with the two prior quarterly cash dividends. The
dividend is payable on January 28, 2005 to stockholders of record on January 14,
2005.
Net interest income for the year ended December 31, 2004 was $23.2 million,
compared to $19.4 million for the prior year, an increase of 19.8 percent. For
the three months ended December 31, 2004, net interest income increased 13.8
percent, to $6.0 million, from $5.3 million for the same period in 2003.
Other expenses increased $2.8 million, or 18.0 percent, for the year ended
December 31, 2004, to $18.4 million, from $15.6 million for the prior year. For
the three months ended December 31, 2004, other expenses increased $917,000, or
22.9 percent, to $4.9 million, from $4.0 million for the same period in 2003.
The increase was primarily attributable to wages and benefits associated with
the Company's growth strategy, equity-based employee compensation plans, and an
increase in audit and professional expenses.
About Synergy Financial Group, Inc.
Synergy Financial Group, Inc. is the holding company for Synergy Bank and
Synergy Financial Services, Inc. The Company is a financial services company
that provides a diversified line of products and services to individuals and
small- to mid-size businesses. Synergy offers consumer banking, mortgage
lending, commercial banking, consumer finance, Internet banking, and financial
services through a network of 18 branch offices located in Middlesex, Monmouth,
Morris, and Union counties New Jersey.
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Forward-Looking Statements
This press release contains forward-looking statements, which are not historical
facts and pertain to future operating results. These forward-looking statements
are within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, but are not limited to, statements
about our plans, objectives, expectations, and intentions and other statements
contained in this press release that are not historical facts.
When used in this press release, the words "expects," "anticipates," "intends,"
"plans," "believes," "seeks," "estimates," or words of similar meaning, or
future or conditional verbs, such as "will," "would," "should," "could," or
"may," are generally intended to identify forward-looking statements. These
forward-looking statements are inherently subject to significant business,
economic, and competitive uncertainties and contingencies, many of which are
beyond our control. In addition, these forward-looking statements are subject to
assumptions with respect to future business strategies and decisions that are
subject to change. Actual results may differ materially from the results
discussed in these forward-looking statements. We do not undertake to update any
forward-looking statement that may be made by the Company from time to time.
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SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands)
December 31, December 31,
2004 2003
(unaudited) (audited)
----------- ---------
Assets:
Cash and amounts due from banks $ 4,687 $ 4,481
Interest-bearing deposits with banks 1,759 2,811
----------- -----------
Cash and cash equivalents 6,446 7,292
Investment securities available-for-sale,
at fair value 134,360 123,779
Investment securities held-to-maturity (fair
value of $111,154 and $33,216, respectively) 110,584 33,214
Federal Home Loan Bank of New York
stock, at cost 10,771 3,644
Loans receivable, net 561,687 434,585
Accrued interest receivable 2,751 2,021
Property and equipment, net 16,814 17,620
Cash surrender value of bank-owned life insurance 12,637 2,475
Other assets 4,627 3,988
----------- -----------
Total assets $ 860,677 $ 628,618
=========== ===========
Liabilities:
Deposits $ 538,916 $ 473,535
Federal Home Loan Bank advances 212,414 72,873
Advance payments by borrowers
for taxes and insurance 1,702 1,582
Accrued interest payable on advances 385 119
Stock subscriptions payable - 38,322
Dividend payable 498 -
Other liabilities 2,720 1,259
----------- -----------
Total liabilities 756,635 587,690
----------- -----------
Commitments and contingencies - -
Stockholders' equity:
Preferred stock; $.10 par value, 5,000,000 shares
authorized; issued and outstanding - none - -
Common stock; $.10 par value, 20,000,000 shares
authorized; issued December 31, 2004 - 12,452,011,
December 31, 2003 - 3,344,252 1,245 334
Additional paid-in-capital 86,177 15,008
Retained earnings 30,603 27,858
Unearned ESOP shares (5,962) (1,009)
Unearned RSP compensation (3,391) (1,011)
Treasury stock acquired for the RSP (4,343) (103)
Accumulated other comprehensive
income (loss), net of taxes (287) (149)
----------- -----------
Total stockholders' equity 104,042 40,928
----------- -----------
Total liabilities and stockholders' equity $ 860,677 $ 628,618
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SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(In thousands, except per share data)
For the Three Months For the Twelve Months
Ended December 31, Ended December 31,
2004 2003 2004 2003
(unaudited) (unaudited) (unaudited) (audited)
----------- ----------- ----------- ---------
Interest income:
Loans, including fees $ 7,611 $ 6,666 $ 28,258 $ 25,548
Investment securities 2,354 1,228 7,980 4,401
Other 74 13 162 117
--------- -------- --------- ---------
Total interest income 10,039 7,907 36,400 30,066
--------- -------- --------- ---------
Interest expense:
Deposits 2,499 2,151 9,114 8,936
Borrowed funds 1,540 484 4,078 1,750
--------- -------- --------- ---------
Total interest expense 4,039 2,635 13,192 10,686
--------- -------- --------- ---------
Net interest income before provision for loan losses 6,000 5,272 23,208 19,380
--------- -------- --------- ---------
Provision for loan losses 359 392 1,492 1,115
--------- -------- --------- ---------
Net interest income after provision for loan losses 5,641 4,880 21,716 18,265
--------- -------- --------- ---------
Other income:
Service charges and other fees on deposit accounts 578 502 2,182 1,713
Net gain on sale of loans - - - 18
Net gain on sale of investments - 8 38 156
Commissions 331 29 517 118
Other 211 277 547 629
--------- -------- --------- ---------
Total other income 1,120 816 3,284 2,634
--------- -------- --------- ---------
Other expenses:
Salaries and employee benefits 2,750 2,029 9,930 7,739
Premises and equipment 946 906 3,800 3,757
Occupancy 475 482 1,911 1,904
Professional services 318 120 721 482
Advertising 219 210 822 794
Other operating expenses 223 267 1,197 900
--------- -------- --------- ---------
Total other expenses 4,931 4,014 18,381 15,576
--------- -------- --------- ---------
Income before income tax expense 1,830 1,682 6,619 5,323
--------- -------- --------- ---------
Income tax expense 636 572 2,416 1,911
--------- -------- --------- ---------
Net income $ 1,194 $ 1,110 $ 4,203 $ 3,412
========= ======== ========= =========
Per share of common stock:
Basic earnings per share $ 0.10 $ 0.34 $ 0.38 $ 1.05
Diluted earnings per share $ 0.10 $ 0.34 $ 0.37 $ 1.05
Basic weighted average shares outstanding 11,374,461 3,236,935 11,009,038 3,234,878
Diluted weighted average shares outstanding 11,734,472 3,301,853 11,275,680 3,259,896
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