EXHIBIT 99.1
(CIVITAS BANKGROUP LOGO)
810 Crescent Centre Drive, Suite 320
Franklin, TN 37067
office 615.263.9500 fax 615.383.8830
FOR IMMEDIATE RELEASE Contact: Aimee Punessen,
- --------------------- Investor Relations
615.236.7454
CIVITAS REPORTS ASSET AND PROFIT GROWTH
FRANKLIN, Tenn. (April 20, 2006) -- Civitas BankGroup (OTC: CVBG) reported net
income of $3.2 million for the first quarter 2006. Growth in assets, loans, and
deposits was strong.
Net income for the first quarter 2006 included a non-recurring $2.1 million
(after tax) gain related to the company's sale of its 50% interest in the Murray
(Kentucky) Bank. Earnings for the first quarter 2006, excluding this gain, was
$1.1 million.
Income from continuing operations for the first quarter 2005 was $903 thousand.
Total net income for the first quarter 2005 was $3.7 million, including a $2.7
million after tax gain from the sale of the company's Collierville (Tennessee)
bank.
For the fourth quarter 2005, Civitas BankGroup earned $1.0 million from
continuing operations.
"In spite of the impact of growth-related expenses and large, non-recurring
items related to the sale of subsidiaries, our core or basic earnings increased
in the first quarter 2006 by almost 20% over the comparable period in 2005,"
commented Richard Herrington, President of Civitas BankGroup.
"Our complete focus is now Middle Tennessee. We have added key bankers and our
preparations for expansion continue. Cumberland Bank, our Middle Tennessee bank,
will open a new banking center in Hendersonville this quarter and plans to open
a Murfreesboro office shortly. In both cases, our new bankers for these markets
are already working with us."
"Earnings, however, have been negatively impacted by national interest rate
markets, characterized by a flat or inverted yield curve and rapidly rising
short-term interest rates. This has negatively impacted our earnings as we have
rebuilt our balance sheet and shifted our funding philosophy away from
long-term, high cost certificates of deposits."
Loans, deposits, and assets have all grown materially at Cumberland Bank.
Compared to March 31, 2005, loans have increased $63 million (14.1%), deposits
have increased $38 million (6.4%), and assets have grown to $778 million, an
increase of 8.4%.
"The first quarter 2006 was an exceptional growth quarter for Cumberland Bank,"
explained Herrington. "Compared to year-end, loans grew at a 23.4% annualized
growth rate and deposits increased at an 18.5% annualized growth rate. The
results of our expansion into Hendersonville and Murfreesboro will materialize
later in 2006."
Non-performing assets held steady in the first quarter, ending at $2.6 million.
The total of non-performing assets (non-accrual loans and foreclosed properties)
was $5.9 million at March 31, 2005.
"We feel that our significant problem asset issues are behind us," added
Herrington. "Our asset quality ratios put us in a leadership position among
banks. For example, our delinquency ratio finished the quarter below 0.6% of
loans, which is less than half of our peer group average."
"We are in the fourth year of our rebuilding program, and we are pleased with
the results," said Herrington. "Since year-end 2002, we have achieved three key
objectives. First, we have eliminated the vast majority of our problem loan
issues and implemented an appropriate credit culture. Second, we have
significantly grown Cumberland Bank, increasing assets from $468 million at
year-end 2002 to $778 million at March 31, 2006. Finally, while sacrificing
short-term earnings to solve problems and build a strong foundation, we have
increased core earnings and developed a positive trend in profits and
profitability. To accomplish these three objectives at the same time is
remarkable."
On March 31, 2006, Civitas completed the sale of its 50% ownership position in
The Murray Bank to BancKentucky, the other 50% owner of the bank.
Civitas BankGroup is a bank holding company operating in Middle Tennessee
through Cumberland Bank. The company also owns 50% of Nashville's Insurors Bank.
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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.
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CIVITAS BANKGROUP, INC.
(all dollars in thousands)
(unaudited)
March 31, December 31,
2006 2005 % Change
--------- --------- --------
BALANCE SHEET SUMMARY
Assets
Cash and Cash Equivalents $ 32,862 $ 31,510 4.3%
Federal Funds Sold & Interest Bearing Deposits 2,170 3,657 -40.7%
Investment Securities 209,290 205,170 2.0%
Loans 508,244 480,141 5.9%
Allowance for Loan Losses (5,041) (4,765) 5.8%
--------- --------- -----
Net Loans 503,203 475,376 5.9%
Fixed Assets 13,830 14,025 -1.4%
Foreclosed Properties 181 346 -47.7%
Other Assets 21,228 19,432 9.2%
--------- --------- -----
Total Assets $ 782,764 $ 749,516 4.4%
========= ========= =====
Liabilities and Shareholders' Equity
Deposits $ 628,518 $ 600,766 4.6%
Subordinated Debentures 17,000 17,000 0.0%
Repurchase Agreements and Other Borrowings 81,691 80,452 1.5%
Other Liabilities 5,529 4,073 35.7%
Shareholders' Equity 50,026 47,225 5.9%
--------- --------- -----
Total Liabilities, Equity $ 782,764 $ 749,516 4.4%
========= ========= =====
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CIVITAS BANKGROUP, INC.
(all dollars in thousands except per share data)
(unaudited)
Three Months Ended March 31,
2006 2005 % Change
----------- ----------- --------
INCOME STATEMENT
Interest Income $ 11,664 $ 9,252 26.1%
Interest Expense 6,015 4,150 44.9%
----------- ----------- -------
Net Interest Income 5,649 5,102 10.7%
Provision for Loan Losses 328 333 -1.5%
Non-Interest Income 4,899 1,966 149.2%
Non-Interest Expense 5,199 5,439 -4.4%
----------- ----------- ------
Income Before Taxes 5,021 1,296 287.4%
Income Taxes 1,820 393 363.1%
----------- ----------- ------
Income from continuing operations* $ 3,201 $ 903 254.5%
=========== =========== ======
Income from discontinued operations -- 82 -100.0%
Gain on sale of discontinued operations -- 2,693 -100.0%
----------- ----------- ------
Net Income 3,201 3,678 -13.0%
=========== =========== ======
PER SHARE DATA
Income - Basic - Continuing Operations $ 0.20 $ 0.05 278.7%
Income - Diluted - Continuing Operations 0.20 0.05 280.4%
Income - Basic - Discontinued Operations -- 0.16 -100.0%
Income - Diluted - Discontinued Operations -- 0.16 -100.0%
Income - Basic 0.20 0.22 -7.9%
Income - Diluted 0.20 0.22 -7.5%
Common Book Value per Share 3.15 2.78 13.3%
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 15,857,162 16,942,208 -6.4%
Diluted 15,858,786 17,019,761 -6.8%
* Includes $2.1 million after tax gain on sale of The Murray Bank for 2006
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CIVITAS BANKGROUP, INC.
(all dollars in thousands)
(unauditied)
Three Months Ended
March 31,
2006 2005
-------- --------
AVERAGE BALANCES
Loans $509,081 $441,237
Investment Securities 214,527 204,516
Earning Assets 728,007 661,633
Total Assets of Discontinued Operations -- 131,749
Total Assets 788,017 843,003
Demand Deposits $ 59,592 $ 62,797
Interest-Bearing Deposits 572,631 513,293
Total Deposits of Discontinued Operations -- 108,218
Total Deposits 632,223 684,308
Shareholders' Equity 47,678 57,835
KEY PERFORMANCE RATIOS - CONTINUING OPERATIONS (ANNUALIZED)*
Return on Average Assets 1.62% 0.51%
Return on Average Equity 26.86% 6.63%
Net Interest Margin 3.10% 3.08%
Efficiency Ratio 49.29% 76.95%
ASSET QUALITY DATA - CONTINUING OPERATIONS
Nonperforming Assets 2,590 5,912
Allowance for Loan Losses 5,041 4,611
Net Charge-Offs 52 150
Nonperforming Assets to Period-
End Loans 0.51% 1.32%
Allowance for Loan Losses to
Period-End Loans 0.99% 1.03%
Net Charge-Offs to Average
Loans 0.04% 0.14%
* Calculations include $2.1 million after tax gain on sale of The Murray Bank
for 2006
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