[CIVITAS BANKGROUP LOGO]
810 Crescent Centre Drive, Suite 320
Franklin, TN 37067
office 615.263.9500 fax 615.383.8830
FOR IMMEDIATE RELEASE Contact: Mike Alday
Alday Communications
615.791.1535
CIVITAS REPORTS HEALTHY INCREASE IN PROFITS
FRANKLIN, Tenn. (April 22, 2004) - Civitas BankGroup (OTC: CVBG) reported an
87.6% increase in net income for the first quarter 2004.
For the first quarter 2004, Civitas BankGroup earned $754,000 compared to a net
income of $402,000 for the same period in 2003, an increase of 87.6%. On a per
share basis, the 2004 net income was $.04, compared to $.03 from the same period
in 2003.
For the fourth quarter 2003, Civitas reported net income of $736,000, or $.04
per share.
Non-performing assets (non-accrual loans and foreclosed properties) at Civitas
BankGroup increased slightly to $20.0 million at March 31, 2004 from December
31, 2003. Problem assets peaked at $26.4 million at September 30, 2002.
"While we are encouraged by our growth in profits, the resolution of problem
assets continues to be our top short-term priority," explained Richard E.
Herrington, President of Civitas BankGroup. "Problem assets peaked eighteen
months ago, and we have methodically worked through the liquidation process. We
took a small step backwards during the first quarter, but our plan is working."
In addition, asset growth continued to be strong at Civitas BankGroup. As of
March 31, 2004, assets totaled $825 million, an increase of 7.6% from March 31,
2003 total assets. Other growth rates for the same time period were 1.0% for
loans and 5.0% for deposits.
"The growth rate in loans is misleading," commented Herrington. "Over the last
several quarters, we have moved a large dollar amount of loans from our balance
sheet through liquidation, charge-off, or sale. We have experienced solid growth
in new loans, particularly in our Middle Tennessee markets.
"We are in the second year of our four-year rebuilding program," added
Herrington. "Our 2003 focus was to identify problem loans, to develop action
plans for liquidation of
these assets, and to execute the plans. The action plans will continue to be
executed in 2004. However, as these problems are solved, we are now attacking
operating inefficiencies and setting the stage for future growth."
At the beginning of the second quarter 2004, Civitas BankGroup filed an
application with state and federal regulators to merge Cumberland Bank
(headquartered in Carthage) and Cumberland Bank South (located in Franklin). The
combined bank, with assets approaching $600 million, will be called Cumberland
Bank and will be headquartered in Franklin.
Since December 2002, the company has raised nearly $16.0 million in new equity
capital to support future growth. In January 2004, the company announced it has
reached an agreement to sell the Bank of Dyer's Three Way branch in Madison
County. This sale is expected to close in April 2004. A quarterly dividend of
$.015 per share was paid this month.
Civitas BankGroup, formerly known as Cumberland Bancorp, is a multi-bank holding
company operating 23 retail offices. It is the parent company of Cumberland Bank
South in Franklin, Cumberland Bank in Carthage, BankTennessee in Collierville,
Bank of Dyer, and Bank of Mason.
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THE STATEMENTS CONTAINED IN THIS RELEASE WHICH ARE NOT HISTORICAL FACTS ARE
FORWARD-LOOKING STATEMENTS MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. FORWARD-LOOKING STATEMENTS
DESCRIBING OUR FUTURE PLANS, PROJECTIONS, STRATEGIES AND EXPECTATIONS, ARE BASED
ON ASSUMPTIONS AND INVOLVE A NUMBER OF RISKS AND UNCERTAINTIES, MANY OF WHICH
ARE BEYOND OUR CONTROL. ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE
PROJECTED DUE TO CHANGES IN INTEREST RATES, COMPETITION IN THE INDUSTRY, CHANGES
IN LOCAL AND NATIONAL ECONOMIC CONDITIONS AND VARIOUS OTHER FACTORS. ADDITIONAL
INFORMATION CONCERNING SUCH FACTORS, WHICH COULD AFFECT US, IS CONTAINED IN OUR
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.
CIVITAS BANKGROUP
(all dollars in thousands)
(unaudited)
Three Months Ended
March 31,
2004 2003
------- -------
AVERAGE BALANCES
Loans 551,158 536,476
Investment Securities 198,828 112,856
Earning Assets 767,411 674,881
Total Assets 829,081 743,323
Demand Deposits 74,319 61,232
Interest-Bearing Deposits 597,814 555,613
Total Deposits 672,133 616,845
Shareholders' Equity 55,752 45,338
KEY PERFORMANCE RATIOS (ANNUALIZED)
Return on Average Assets 0.36% 0.22%
Return on Average Equity 5.41% 3.55%
Net Interest Margin 3.53% 3.69%
Efficiency Ratio 80.11% 86.41%
ASSET QUALITY DATA
Nonperforming Assets 19,969 23,559
Allowance for Loan Losses 8,463 8,505
Net Charge-Offs 512 981
Nonperforming Assets to Period-
End Loans 3.62% 4.31%
Allowance for Loan Losses to
Period-End Loans 1.53% 1.56%
Net Charge-Offs to Average
Loans 0.09% 0.18%
CIVITAS BANKGROUP
(all dollars in thousands except per share data)
(unaudited)
Three Months Ended March 31,
2004 2003 % Change
---------- ---------- --------
INCOME STATEMENT
Interest Income 10,598 10,332 2.6%
Interest Expense 3,870 4,146 (6.7)%
---------- ---------- ----
Net Interest Income 6,728 6,186 8.8%
Provision for Loan Losses 561 424 32.3%
Non-Interest Income 1,710 1,646 3.9%
Non-Interest Expense 6,760 6,768 (0.1)%
---------- ---------- ----
Income Before Taxes 1,117 640 74.5%
Income Taxes 363 238 52.5%
---------- ---------- ----
Net Income 754 402 87.6%
PER SHARE DATA
Net Income - Basic 0.04 0.03 33.3%
Net Income - Diluted 0.04 0.03 33.3%
Cash Dividends 262 231 13.4%
Common Book Value per Share 3.24 2.94 10.2%
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 17,309,303 15,383,945 12.5%
Diluted 17,359,468 15,610,675 11.2%
CIVITAS BANKGROUP
(all dollars in thousands)
(unaudited)
March 31, December 31,
2004 2003 % Change
--------- ------------ --------
BALANCE SHEET SUMMARY
Assets
Cash and Cash Equivalents 22,300 19,977 11.6%
Federal Funds Sold 11,189 15,081 (25.8)%
Investment Securities 198,817 207,417 (4.1)%
Loans 551,750 550,565 0.2%
Allowance for Loan Losses (8,463) (8,414) 0.6%
------- ------- ----
Net Loans 543,287 542,151 0.2%
Fixed Assets 22,510 22,280 1.0%
Foreclosed Properties 4,030 3,793 6.2%
Other Assets 22,709 22,621 0.4%
------- ------- ----
Total Assets 824,842 833,320 (1.0)%
Liabilities and Stockholders Equity
Deposits 672,629 671,636 0.1%
Trust Preferred Securities 12,000 12,000 0.0%
Other Borrowings 78,590 90,438 (13.1)%
Other Liabilities 5,122 4,505 13.7%
Shareholders Equity 56,501 54,741 3.2%
------- ------- ----
Total Liabilities, Equity 824,842 833,320 (1.0)%