[FIRST FINANCIAL CORPORATION OF WESTERN MARYLAND LETTERHEAD]
PRESS RELEASE
Release Date: Further Information:
IMMEDIATE RELEASE Patrick J. Coyne
Chairman of the Board, President
and Chief Executive Officer
- or -
William C. Marsh
Executive Vice President
Chief Financial Officer
April 16, 1997 Phone: 301/724-3363
FIRST FINANCIAL CORPORATION OF WESTERN MARYLAND ANNOUNCES
EARNINGS FOR THIRD QUARTER OF FISCAL 1997
Cumberland, MD, April 16, 1997 - First Financial Corporation of Western
Maryland (Nasdaq: FFWM), the holding company for First Federal Savings Bank
of Western Maryland, today announced consolidated net income for the quarter
ended March 31, 1997, of $1.2 MILLION OR $0.58 per share, as compared to net
income of $989,000 or $0.45 per share for the same period in the prior fiscal
year. The Corporation's annualized return on average assets and return on
average equity were 1.37% and 11.70%, respectively, for the current quarter
ended March 31, compared to 1.19% and 9.73%, respectively, for the same
quarter last fiscal year.
For the nine month period ended March 31, 1997, the Corporation realized
consolidated net income of $3.7 MILLION or $1.69 per share, representing an
annualized return on average assets and return on average equity of 1.39% and
11.67%, respectively, before the one-time special Savings Association Insurance
Fund (SAIF) assessment incurred during the first quarter of the fiscal year.
This compares to net income of $2.6 million or $1.19 per share for the nine
month period ended March 31, 1996. Net income for the nine months ended March
31, 1997 after the SAIF assessment was $2.5 million or $1.15 per share.
Patrick J. Coyne, Chairman of the Board, President and Chief Executive Officer
of the Corporation, attributed the Corporation's improved operating results for
the quarter and year-to-date periods primarily to an increase in net interest
income related principally to loan portfolio growth. The Corporation's net
interest income before provision for loan losses increased $1.2 million or
11.1% to $11.7 million for the nine months ended March 31, 1997, compared to
$10.5 million for the same period in fiscal 1996. The Corporation's net
interest spread increased to 3.97% for the nine month period ended March 31,
1997, from 3.84% for the same nine month period in the prior fiscal year.
PRESS RELEASE
Page 2 of 3
April 16, 1997
The Corporation originated $109.4 million in new loans during the first nine
months of fiscal 1997, resulting in an increase in total loans receivable of
$47.7 million or 19.6% to $290.8 million at March 31, 1997 from $243.1 million
at June 30, 1996.
The Corporation also continued to strengthen its balance sheet as non-
performing assets net of related reserves decreased $2.7 million or 42.3% to
$3.7 million at March 31, 1997, compared to $6.4 million at June 30, 1996.
Non-performing assets as a percentage of total assets decreased to 1.02% at
March 31, 1997, from 2.00% at June 30, 1996. Total loan loss and real estate
owned reserved represented 186.4% of non-performing assets at March 31, 1997.
On November 26, 1996, the Corporation and Keystone Financial, Inc. (Nasdaq:
KSTN) entered into a definitive agreement whereby Keystone will acquire the
Corporation and its subsidiaries, including the Bank. The merger transaction
has received all required regulatory approvals and, subject to approval of the
Corporation's stockholders, consummation of the merger is expected to be
completed in late May of 1997.
First Federal Savings Bank of Western Maryland is a federally chartered, FDIC-
insured stock savings bank which conducts its business through 10 offices
located within the greater Cumberland area, Hagerstown, Frostburg, Oakland and
Westernport, Maryland.
PRESS RELEASE
Page 2 of 3
April 16, 1997
FIRST FINANCIAL CORPORATION OF WESTERN MARYLAND
SUMMARY OF OPERATING RESULTS
QUARTER ENDED MARCH 31: F 1997 F 1996
- ---------------------------------------------------------------------------
Net income before income taxes $2,035,000 $1,644,000
Provision for income taxes $ 786,000 $ 655,000
---------- ----------
Net income $1,249,000 $ 989,000
========== ==========
Provision for loan losses $ -- $ 150,000
Net income per share $ 0.58 $ 0.45
Annualized return on average assets 1.37% 1.19%
Annualized return on average stockholders' equity 11.70% 9.73%
NINE MONTHS ENDED MARCH 31: F 1997 F 1996
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Net income before provision for income taxes and
one-time SAIF assessment $5,930,000 $4,242,000
Provision for income taxes 2,280,000 1,641,000
--------- ---------
Net income before one-time SAIF assessment 3,650,000 2,601,000
One-time SAIF assessment, net of income taxes 1,172,000 --
--------- ---------
Net income $2,478,000 $2,601,000
========== ==========
Net income per share:
Net income before one-time SAIF assessment $ 1.69 $ 1.19
One-time SAIF assessment, net of income taxes -0.54 --
---------- ----------
Net income per share $ 1.15 $ 1.19
========== ==========
Annualized return on average assets:
Before one-time SAIF assessment 1.39% 1.05%
After one-time SAIF assessment 0.94% 1.05%
Annualized return on average stockholders' equity:
Before one-time SAIF assessment 11.67% 8.73%
After one-time SAIF assessment 7.92% 8.73%
BALANCE SHEET DATA 3/31/97 6/30/96
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Total assets $364,726,000 $321,994,000
Total loans $290,785,000 $243,113,000
Total deposits $280,953,000 $274,756,000
Total stockholders' equity $ 43,182,000 $ 41,707,000
Total shares outstanding 2,175,659 2,176,739
Book value per share $ 19.85 $ 19.16