Exhibit 99.1
CONTACTS: Mary K. Talbot
(401) 245-8819
SLADE'S FERRY BANCORP REPORTS EARNINGS
SOMERSET, Mass. (October 18, 2006) -- Slade's Ferry Bancorp (the "Company")
(NASDAQ Capital Market: SFBC), parent company of Slade's Ferry Trust Company
(the "Bank"), announced that its net income for the quarter ended September 30,
2006 was $1.0 million or $0.25 per share (diluted), an increase of 15.9% over
net income for the quarter ended September 30, 2005, which totaled $900,000 or
$0.22 per share (diluted). For the nine months ended September 30, 2006, net
income was $2.6 million or $0.62 per share (diluted), a decrease of 9.6% from
net income for the nine months ended September 30, 2005, which totaled $2.8
million or $0.69 per share (diluted).
Net income increased by $143,000 for the three months ended September 30, 2006
as compared to the same period in 2005. This increase was primarily attributable
to a $182,000 increase in net interest income and a $130,000 increase in
non-interest income partially offset by an increase of $56,000 in non-interest
expense. Net income decreased by $272,000 for the nine months ended September
30, 2006 when compared to the year earlier period. Increases in both net
interest income and non-interest income of $268,000 and $270,000, respectively,
were more than offset by an increase in non-interest expense of $821,000, or
7.7%, to $11.4 million for nine months ended September 30, 2006. A large part of
this increase was attributed to the outsourcing of substantial portions of back
office operations to minimize risk, increase efficiency and utilize advanced
technologies which were partially offset by savings in salary expenses. Also
included in the non-interest expense component were increases of $49,000 for the
three month period and $185,000 for the nine month period attributable to the
additional compensation expense incurred with the implementation of FAS 123R,
Accounting for Stock Based Compensation.
Non-interest income increased by $130,000 and $270,000, respectively, for the
three and nine month periods ended September 30, 2006. These increases were
primarily attributable to an increase in fees and other service charges on
deposit accounts resulting from the introduction of an overdraft protection
program in October, 2005. Non-interest income for the nine month period was
negatively affected by net security losses of $150,000 that were primarily the
result of a reinvestment strategy in June, 2006 designed to improve the net
interest margin.
Net loans totaled $426.4 million at September 30, 2006, an increase of 4.1% over
$409.6 million at December 31, 2005. As a result of loan growth, total interest
and dividend income increased from $7.5 million for the quarter ended September
30, 2005, to $8.7 million for the quarter ended September 30, 2006, an increase
of 16.5%. For the nine months ended September 30, 2006, total interest and
dividend income was $24.6 million, compared to $21.2 million for the nine months
ended September 30, 2005, an increase of 15.8%. This growth in an environment
with an inverted yield curve and low yielding loans and investments, combined
with intense competition for deposits, has compressed our net interest margin
from 3.41% for the nine months ended September 30, 2005 to 3.32% for the nine
months ended September 30, 2006.
"We are pleased that our solid loan growth has allowed us to maintain our
strong net interest margin in the face of ever-expanding competition for a
shrinking deposit base," said President and CEO Mary Lynn Lenz.
Total consolidated assets increased from $585.9 million at December 31, 2005 to
$607.8 million at September 30, 2006, an increase of 3.7%. Deposits increased
from $415.8
million at December 31, 2005 to $422.7 million at September 30, 2006, an
increase of 1.6%.
Total stockholders' equity at September 30, 2006 was $50.7 million compared to
$48.9 million at December 31, 2005, an increase of 3.9%. Book value per share
was $12.29 at September 30, 2006 as compared to $11.82 at December 31, 2005.
Both the Company and the Bank maintain capital levels sufficient to be
considered "well-capitalized" under applicable regulatory capital guidelines
and requirements.
The Company declared a $0.09 dividend to common shareholders of record on
September 19, 2006, which is payable on October 20, 2006.
Slade's Ferry Bancorp was founded to serve community-banking needs with both
personal and commercial products and services. With approximately $608 million
in assets and nine retail branches in Southeastern Massachusetts, Slade's Ferry
is a trusted community partner to both business and personal banking customers.
Traded on the NASDAQ Capital Market as SFBC, Slade's Ferry Bancorp can also be
found on the web at www.sladesferry.com and in seven Massachusetts communities
- - Assonet, Fairhaven, Fall River, New Bedford, Seekonk, Somerset and Swansea.
# # #
This news release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including statements
regarding the strength of the company's capital and asset quality. Other such
statements may be identified by words such as "believes," "will," "expects,"
"project," "may," "developments," "strategic," "launching," "opportunities,"
"anticipates," "estimates," "intends," "plans," "targets" and similar
expressions. These statements are based upon the current beliefs and
expectations of Slade's Ferry Bancorp's management and are subject to
significant risks and uncertainties. Actual results may differ materially from
those set forth in the forward-looking statements as a result of numerous
factors.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectation expressed in our
forward-looking statements: (1) enactment of adverse government regulations (2)
competitive pressures among depository and other financial institutions may
increase significantly and have an effect on pricing, spending, third-party
relationships and revenues; (3) the strength of the United States economy in
general and specifically the strength of the New England economics may be
different than expected, resulting in, among other things, a deterioration in
overall credit quality and borrowers' ability to service and repay loans, or a
reduced demand for credit, including the resultant effect on the Bank's loan
portfolio, levels of charge-offs and non-performing loans and allowance for
loan losses; (4) changes in the interest rate environment may reduce interest
margins and adversely impact net interest income and (5) changes in assumptions
used in making such forward-looking statements. Should one or more of these
risks materialize or should underlying beliefs or assumptions prove incorrect,
Slade's Ferry Bancorp's actual results could differ materially from those
discussed. All subsequent written and oral forward-looking statements
attributable to Slade's Ferry Bancorp or any person acting on its behalf are
expressly qualified in their entirety by the cautionary statements set forth
above. Slade's Ferry Bancorp does not intend or undertake any obligation to
update any forward-looking statement to reflect circumstances or events that
occur after the date on which the forward-looking statements are made.
Slade's Ferry Bancorp. and Subsidiary
Consolidated Balance Sheets
(Unaudited)
September 30, 2006 December 31, 2005
------------------ -----------------
Assets (In thousands)
- ------
Cash and due from banks $ 11,841 $ 17,782
Interest-bearing demand deposits with other banks 1,102 36
Federal funds sold 2,000 2,200
-------- --------
Cash and cash equivalents 14,943 20,018
Interest-bearing certificates of deposit with other banks 100 100
Securities available for sale 107,409 94,298
Securities held to maturity 25,752 29,306
Federal Home Loan Bank stock, at cost 6,856 6,304
Loans, net 426,430 409,610
Premises and equipment, net 5,710 5,917
Goodwill 2,173 2,173
Accrued interest receivable 2,459 2,298
Bank-owned life insurance 12,204 11,884
Other assets 3,732 4,006
-------- --------
$607,768 $585,914
======== ========
Liabilities and Stockholders' Equity
- ------------------------------------
Deposits:
Noninterest-bearing $ 76,638 $ 80,705
Interest-bearing 346,033 335,141
-------- --------
Total deposits 422,671 415,846
Short-term borrowings - 7,000
Long-term borrowings 120,938 100,865
Subordinated debentures 10,310 10,310
Accrued expenses and other liabilities 3,092 3,038
-------- --------
Total liabilities 557,011 537,059
Stockholders' equity:
Common stock 42 41
Additional paid-in capital 31,463 31,014
Retained earnings 20,446 18,998
Accumulated other comprehensive loss (719) (1,198)
Unearned compensation (475) -
-------- --------
Total stockholders' equity 50,757 48,855
-------- --------
$607,768 $585,914
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Slade's Ferry Bancorp. and Subsidiary
Consolidated Statements of Income
(Unaudited)
Three Months Ended September 30,
2006 2005
------ ------
(In thousands, except per
share data)
Interest and dividend income:
Interest and fees on loans $7,077 $5,943
Interest and dividends on securities 1,562 1,471
Other interest 54 48
------ ------
Total interest and dividend income 8,693 7,462
Interest expense:
Interest on deposits 2,616 1,672
Interest on Federal Home Loan Bank advances 1,196 1,142
Interest on subordinated debentures 217 166
------ ------
Total interest expense 4,029 2,980
------ ------
Net interest and dividend income 4,664 4,482
Provision for loan losses - 44
------ ------
Net interest income, after provision for loan losses 4,664 4,438
Noninterest income:
Service charges on deposit accounts 373 203
Loss on sales of assets (5) (1)
Gain on sales of loans - 50
Gain on sales and calls of available-for-sale securities, net 19 10
Other income 345 340
------ ------
Total noninterest income 732 602
Noninterest expense:
Salaries and employee benefits 2,044 2,148
Occupancy and equipment expense 478 444
Other expense 1,216 1,090
------ ------
Total noninterest expense 3,738 3,682
------ ------
Income before income taxes 1,658 1,358
Provision for income taxes 615 458
------ ------
Net income $1,043 $ 900
====== ======
Earnings per share:
Basic $ 0.25 $ 0.22
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Diluted $ 0.25 $ 0.22
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Slade's Ferry Bancorp. and Subsidiary
Consolidated Statements of Income
(Unaudited)
Nine Months Ended September 30,
2006 2005
------- -------
(In thousands, except per
share data)
Interest and dividend income:
Interest and fees on loans $20,197 $16,937
Interest and dividends on securities 4,247 4,075
Other interest 136 216
------- -------
Total interest and dividend income 24,580 21,228
Interest expense:
Interest on deposits 6,783 4,288
Interest on Federal Home Loan Bank advances 3,561 3,127
Interest on subordinated debentures 612 457
------- -------
Total interest expense 10,956 7,872
------- -------
Net interest and dividend income 13,624 13,356
Provision for loan losses 39 109
------- -------
Net interest income, after provision for loan losses 13,585 13,247
Noninterest income:
Service charges on deposit accounts 1,032 623
Gain (loss) on sale of assets (5) 51
Gain (loss) on sales and calls of available-for-sale
securities, net (150) 27
Gain on sales of loans - 50
Other income 1,104 960
------- -------
Total noninterest income 1,981 1,711
Noninterest expense:
Salaries and employee benefits 6,442 6,243
Occupancy and equipment expense 1,461 1,253
Other expense 3,537 3,123
------- -------
Total noninterest expense 11,440 10,619
------- -------
Income before income taxes 4,126 4,339
Provision for income taxes 1,550 1,491
------- -------
Net income $ 2,576 $ 2,848
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Earnings per share:
Basic $ 0.62 $ 0.69
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Diluted $ 0.62 $ 0.69
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