Exhibit 99.5 Press Release
PRESS RELEASE
July 20, 1999 For further information contact:
David M. Bradley
Chairman, President and Chief Executive Officer
North Central Bancshares, Inc.
825 Central Avenue PO Box 1237
Fort Dodge, Iowa 50501
515-576-7531
NORTH CENTRAL BANCSHARES, INC. ANNOUNCES
SECOND QUARTER 1999 EARNINGS
Fort Dodge, Iowa -- North Central Bancshares, Inc., (the "Company") the holding
company for First Federal Savings Bank of Iowa (the "Bank"), announced today
that the Company earned $1,074,000, or diluted earnings per share of $0.38, for
the second quarter of 1999, compared to $1,116,000, or diluted earnings per
share of $0.35, for the second quarter of 1998. The Company earned $2,132,000,
or diluted earnings per share of $0.75, for the six months ended June 30, 1999,
compared to $2,222,000, or diluted earnings per share of $0.69, for the six
months ended June 30, 1998.
As of the close of business on January 30, 1998, the Bank completed the
acquisition of Valley Financial Corp. pursuant to an Agreement and Plan of
Merger, dated as of September 18, 1997. The acquisition resulted in the merger
of Valley Financial's wholly owned subsidiary, Valley Savings Bank, FSB, with
and into the Bank, with the Bank as the resulting financial institution. Valley
Savings, headquartered in Burlington, Iowa, was a federally-chartered stock
savings bank with three branch offices located in southeastern Iowa, with assets
of approximately $110 million. The former offices of Valley Savings are being
operated as a division of the Bank.
The acquisition was accounted for as a purchase transaction and therefore, the
operating results of the former offices of Valley Savings Bank are included in
the 1998 operating results of the Company only from the date of acquisition
through June 30, 1998. Therefore, the comparison between periods is
significantly impacted by this acquisition.
Stockholders of record on June 16, 1999, received a quarterly cash dividend of
$0.10 per share on July 6, 1999.
Total assets at June 30, 1999 were $343.6 million as compared to $336.7 million
at December 31, 1998. The increase in assets resulted primarily from increases
in loans and fixed assets, offset by decreases in cash. Cash decreased $6.2
million, or 39.6%, from $15.6 million at December 31, 1998 to $9.4 million at
June 30, 1999. Loans increased by $10.4 million, or 4.1%, from $254.0 million
at December 31, 1998 to $264.4 million at June 30, 1999. Fixed assets increased
$1.5 million, or 40.3%, from $3.6 million at December 31, 1998 to $5.1 million
at June 30, 1999.
- MORE -
Deposits increased $10.1 million, or 4.1%, from $246.7 million at December 31,
1998 to $256.7 million at June 30, 1999. Other borrowed funds increased $1.4
million, or 3.7%, from $38.8 million at December 31, 1998 to $40.3 million at
June 30, 1999.
The unaudited pro forma consolidated statement of income, for the six months
ended June 30, 1998, presented in this press release is based on the historical
financial statements of the Company and Valley Financial and was prepared as if
the acquisition had occurred as of the beginning of the period for purposes of
the combined consolidated statement of income.
The pro forma financial statement of income is not necessarily indicative of the
results of operations that might have occurred had the acquisition taken place
at the beginning of the period, or to project the Company's results of
operations at any future date or for any future period.
Nonperforming assets were 0.17% of total assets as of June 30, 1999 compared to
0.34% of total assets as of December 31, 1998. The allowance for loan losses
was $2.7 million, or 1.01% of total loans, at June 30, 1999, compared to $2.7
million, or 1.03% of total loans, at December 31, 1998.
The net interest spread for the three months ended June 30, 1999 of 2.97% was
increased from the net interest spread of 2.85% for the three months ended June
30, 1998. The net interest margin for the three months ended June 30, 1999 of
3.46% was decreased from the net interest margin of 3.51% for the three months
ended June 30, 1998. Net interest income for the three months ended June 30,
1999 was $2.8 million, compared to net interest income of $2.8 million for the
corresponding period a year ago.
The Bank's provision for loan losses was $30,000 for the three months ended June
30, 1999, compared to pro forma provision for loan losses of $60,000 for the
corresponding period a year ago. The Company establishes provisions for loan
losses, which are charged to operations, in order to maintain the allowance for
loan losses at a level which is deemed to be appropriate based upon an
assessment of prior conditions, the volume and type of loans in the Bank's
portfolio, and other factors related to the collectibility of the Bank's loan
portfolio.
Stockholders' equity was $43.7 million at June 30, 1999, compared to $48.2
million at December 31, 1998, the decrease was due primarily to stock
repurchases. Book value, or stockholders' equity, per share at June 30, 1999
was $16.46, compared to $16.26 at December 31, 1998. The ratio of stockholders'
equity to total assets was 12.7% at June 30, 1999, as compared to 14.3% at
December 31, 1998.
North Central Bancshares, Inc. serves north central and southeastern Iowa at 8
full service locations in Fort Dodge, Nevada, Ames, Perry, Burlington and Mount
Pleasant, Iowa through its wholly-owned subsidiary, First Federal Savings Bank
of Iowa, headquartered in Fort Dodge, Iowa. The Bank's deposits are insured by
the Federal Deposit Insurance Corporation. The Company's stock is traded on The
Nasdaq National Market under the symbol "FFFD".
For more information contact: David M. Bradley, President, 515-576-7531
FINANCIAL HIGHLIGHTS OF NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Financial Condition
(Dollars in Thousands, except per share and share June 30, 1999 December 31, 1998
data) ------------- -----------------
Assets
Cash and cash equivalents $ 9,438 $ 15,637
Securities available for sale 50,988 49,883
Loans (net of allowance of loan loss of $2.7
million and $2.7 million, respectively) 264,418 254,032
Goodwill 6,152 6,388
Other assets 12,618 10,750
---------- ----------
Total Assets $ 343,614 $ 336,690
========== ==========
Liabilities
Deposits $ 256,747 $ 246,690
Other borrowed funds 40,272 38,832
Other liabilities 2,862 2,961
---------- ----------
Total Liabilities 299,881 288,483
Stockholders' Equity 43,733 48,207
---------- ----------
Total Liabilities and Stockholders' Equity $ 343,614 $ 336,690
========== ==========
Stockholders' equity to total assets 12.73% 14.32%
========== ==========
Book value per share $ 16.46 $ 16.26
========== ==========
Total shares outstanding 2,657,242 2,964,449
========== ==========
Condensed Consolidated Statements of Income
(Dollars in Thousands, except per share data)
For the Three Months For the Six Months
Ended June 30, Ended June 30,
1999 1998 1999 1998
------- ------- -------- -------
Interest income $6,005 $6,050 $11,971 $11,515
Interest expense 3,235 3,291 6,434 6,163
------ ------ ------- -------
Net interest income 2,769 2,759 5,537 5,352
Provision for loan loss 30 60 60 120
------ ------ ------- -------
Net interest income after provision for loan loss 2,739 2,699 5,477 5,232
Noninterest income 1,023 973 1,943 1,734
Gain on the sale of securities available for sale 32 -- 32 55
Noninterest expense 2,157 1,894 4,212 3,529
------ ------ ------- -------
Income before income taxes 1,637 1,778 3,240 3,492
Income taxes 563 662 1,108 1,270
------ ------ ------- -------
Net income $1,074 $1,116 $ 2,132 $ 2,222
====== ====== ======= =======
Basic earnings per share $ 0.39 $ 0.36 $ 0.76 $ 0.71
====== ====== ======= =======
Diluted earnings per share $ 0.38 $ 0.35 $ 0.75 $ 0.69
====== ====== ======= =======
Selected Financial Ratios
For the Three Months For the Six Months
Ended June 30, Ended June 30,
1999 1998 1999 1998
------ ------ ------ ------
Performance ratios:
Net interest spread 2.97% 2.85% 2.94% 2.84%
Net interest margin 3.46% 3.51% 3.48% 3.58%
Return on average assets 1.27% 1.35% 1.27% 1.42%
Return on average equity 9.19% 8.79% 8.95% 8.73%
Efficiency ratio (noninterest expense divided by the
sum of net interest income before provision for 56.41% 50.75% 56.07% 49.42%
loan losses plus noninterest income)
June 30, 1999 March 31, 1999 December 31, 1998
-------------- -------------- -----------------
Asset Quality Ratios:
Nonaccrual loans to total net loans 0.10% 0.11% 0.38%
Nonperforming assets to total assets 0.17% 0.17% 0.34%
Allowance for loan losses as a percent
of total loans receivable 1.01% 1.05% 1.03%
Condensed Consolidated Statements of Income
For the Six Months
Ended June 30,
Actual ProForma*
1999 1998
-------- ---------
Interest income $11,971 $12,137
Interest expense 6,434 6,614
------- -------
Net interest income 5,537 5,523
Provision for loan loss 60 120
------- -------
Net interest income after provision for loan loss 5,477 5,403
Noninterest income 1,943 1,788
Gain on the sale of securities available for sale 32 55
Noninterest expense 4,212 3,935
------- -------
Income before income taxes 3,240 3,311
Income taxes 1,109 1,229
------- -------
Net income $ 2,132 $ 2,082
======= =======
*See explanatory note below.
Selected Financial Ratios
For the Six Months
Ended June 30,
Actual ProForma*
1999 1998
-------- ---------
Performance ratios:
Net interest spread 2.94% 2.83%
Net interest margin 3.48% 3.50%
Return on average assets 1.27% 1.25%
Return on average equity 8.95% 8.18%
Efficiency ratio (noninterest expense divided by the
sum of net interest income before provision for
loan losses plus noninterest income) 56.07% 53.42%
*See explanatory note below.
*Pro Forma Consolidated Condensed Statement of Income (Unaudited)
The above unaudited pro forma consolidated statement of income presented is
based on the historical financial statements of the Company and Valley
Financial. The unaudited pro forma consolidated statements of income for the six
months ended June 30, 1998 was prepared as if the acquisition had occurred as of
the beginning of the respective period for purposes of the combined consolidated
statements of income.
The pro forma statement of income is not necessarily indicative of the results
of operations that might have occurred had the acquisition taken place at the
beginning of the period, or to project the Company's results of operations at
any future date or for any future period.