EXHIBIT 99.1
Sacramento, CA - October 15, 2002 - American River Holdings (Nasdaq: AMRB), the
parent company of American River Bank, North Coast Bank and first source capital
announced financial results for the third quarter ended September 30, 2002. Net
income for the quarter was $1,200,000 ($0.43 diluted EPS), up 8.0% from the
$1,111,000 ($0.39 diluted EPS) recorded for the third quarter last year; diluted
EPS increased 10.3%. "This has been another successful quarter for our company.
We have accomplished the highest quarterly net income in our history and have
delivered seventy five consecutive profitable quarters," remarked American River
Holdings President and CEO David Taber. Total assets grew by $53.9 million from
one year ago reaching $331,528,000 at September 30, 2002.
Net income on a year-to-date basis was $3,188,000 ($1.13 diluted EPS) up 5.0%
from the $3,036,000 ($1.07 diluted EPS) recorded in the same period last year.
For the nine months ending September 30, 2002, and when compared to the same
period in 2001, net interest income increased from $10,965,000 to $11,026,000.
Noninterest income decreased from $1,791,000 in 2001 to $1,663,000 at September
30, 2002. Noninterest expense also decreased from $7,147,000 last year to
$6,917,000 this year.
Net interest income for the third quarter 2002 was $3,820,000 up 4.7% from the
$3,649,000 recorded in the third quarter 2001. For the quarter ended September
30, 2002, the net interest margin was 5.18% compared to the 5.76% recorded in
the third quarter ended September 30, 2001. Non-interest income for the most
recent quarter was $619,000, which was a decrease of 5.6% when compared to
$656,000 recorded in the same period during the previous year. For the quarter,
non-interest expense increased from $2,267,000 to $2,285,000, or 0.8%.
Net loans and leases grew by $18,292,000 (9.1%) from one year ago to
$219,568,000. Investment securities increased $40.5 million from one year ago;
$25 million relates to an investment strategy that allowed the company to take
advantage of a relatively steep yield curve, to utilize excess capital and to
reduce exposure to further declines in intermediate term interest rates by
purchasing mortgage-backed securities and funding them with wholesale Federal
Home Loan Bank advances. Short-term borrowings increased by $29.4 million over
the same one-year period, $25,000,000 of the increase relates to the investment
strategy. The Company made this decision knowing that it would improve the
return on average equity by increasing the net interest income in absolute terms
even though it would reduce the return on average assets and the net interest
margin as a percentage. Deposits increased by 8.8% to $265,000,000. The largest
increase is noninterest bearing deposits, which increased by 21.1% to
$75,425,000 and accounts for 28.5% of total deposits as of September 30, 2002.
Asset quality remained strong for the company. Non-performing loans and leases
were 0.13% of the total loans and leases at September 30, 2002. Net chargeoffs
on a year-to-date basis were -0.02% of average loans and leases, representing
larger recoveries than losses during the third quarter. The allowance for loan
and lease losses was $3,141,000 as of September 30, 2002, which is 1.41% of
total loans and leases and 1121.8% of non-performing loans and leases.
For the third quarter, ended September 30, 2002 return on average assets was
1.48%; return on average equity was 16.01% and the efficiency ratio was 51.00%.
These three performance benchmarks have shown positive movement during 2002. The
return on average assets has moved from 1.37% in the first quarter to 1.42% in
the second quarter and 1.48% for the third quarter. Return on average equity was
13.79% in the first quarter, 14.26% in the second quarter and 16.01% in the
third quarter. Finally, the efficiency ratio improved from 56.95% in the first
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quarter to 54.28% in the second quarter and 51.00% in the third quarter. For the
first nine months of this year, return on average assets was 1.43%, the return
on average equity was 14.71% and the efficiency ratio was 53.99%.
American River Holdings is a financial services company with three affiliates,
American River Bank, a community business bank with four offices in Sacramento
and Placer Counties; North Coast Bank, a community business bank with three
offices in Sonoma County; and first source capital, headquartered in Sacramento,
which provides equipment lease financing on a brokerage basis for businesses
throughout the country.
Related websites: www.amrb.com, www.americanriverbank.net,
www.northcoastbank.com, www.firstsourcecapital.com
Unaudited financial statements are attached. Earnings per share have been
adjusted for a 5% stock dividend.
FORWARD-LOOKING INFORMATION
In addition to the historical information contained herein, this press release
contains certain forward-looking statements. The reader of this press release
should understand that all such forward-looking statements are subject to
various uncertainties and risks that could affect their outcome. The Company's
actual results could differ materially from those suggested by such
forward-looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, variances in the actual versus
projected growth in assets, return on assets, loan losses, expenses, rates
charged on loans and earned on securities investments, rates paid on deposits,
competition effects, fee and other non interest income earned, general economic
conditions, nationally, regionally and in the operating market areas of the
Company and its subsidiaries, changes in the regulatory environment, changes in
business conditions and inflation, changes in securities markets, data
processing problems, a decline in real estate values in the Company's market
area, the California energy shortage, the effects of terrorism, including the
events of September 11, 2001 and thereafter, and the conduct of the war on
terrorism by the United States and its allies, as well as other factors. This
entire press release should be read to put such forward-looking statements in
context.
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AMERICAN RIVER HOLDINGS FINANACIAL SUMMARY
(unaudited)
CONSOLIDATED BALANCE SHEET
SEPTEMBER 30 SEPTEMBER 30 DECEMBER 31
ASSETS 2002 2001 2001
Cash and due from banks $ 17,417,000 $ 16,058,000 $ 20,342,000
Federal funds sold -- 4,280,000 7,814,000
Interest-bearing deposits in banks 6,037,000 5,741,000 5,740,000
Investment securities 81,531,000 41,075,000 48,912,000
Loans and leases, net 219,568,000 201,276,000 195,026,000
Bank premises and equipment 1,755,000 1,885,000 1,903,000
Accounts receivable servicing receivable, net 1,873,000 3,680,000 2,869,000
Accrued interest and other assets 3,347,000 3,619,000 3,953,000
------------ ------------ ------------
$331,528,000 $277,614,000 $286,559,000
============ ============ ============
LIABILITIES & EQUITY
Noninterest-bearing deposits $ 75,425,000 $ 62,268,000 $ 67,740,000
Interest-bearing deposits 189,575,000 181,200,000 187,148,000
------------ ------------ ------------
Total deposits 265,000,000 243,468,000 254,888,000
------------ ------------ ------------
Short-term borrowings 31,700,000 2,300,000 --
Long-term debt 2,004,000 2,051,000 2,039,000
Accrued interest and other liabilities 1,751,000 2,025,000 1,690,000
------------ ------------ ------------
Total liabilities 300,455,000 249,844,000 258,617,000
Total equity 31,073,000 27,770,000 27,942,000
------------ ------------ ------------
$331,528,000 $277,614,000 $286,559,000
============ ============ ============
Nonperforming loans and leases to total loans and leases 0.13% 0.23% 0.43%
Net chargeoffs to average loans and leases -0.02% 0.21% 0.31%
Allowance for loan and lease loss to nonperforming
loans and leases 1121.8% 585.7% 305.4%
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
THIRD THIRD FOR THE NINE MONTHS
QUARTER QUARTER ENDING SEPTEMBER 30
2002 2001 2002 2001
Interest income $ 4,732,000 $ 5,055,000 $13,683,000 $16,155,000
Interest expense 912,000 1,406,000 2,657,000 5,190,000
----------- ----------- ----------- -----------
Net interest income 3,820,000 3,649,000 11,026,000 10,965,000
Provision for loan and lease loss 160,000 192,000 494,000 573,000
Total noninterest income 619,000 656,000 1,663,000 1,791,000
Total noninterest expense 2,285,000 2,267,000 6,917,000 7,147,000
----------- ----------- ----------- -----------
Income before taxes 1,994,000 1,846,000 5,278,000 5,036,000
Income taxes 794,000 735,000 2,090,000 2,000,000
----------- ----------- ----------- -----------
Net income $ 1,200,000 $ 1,111,000 $ 3,188,000 $ 3,036,000
=========== =========== =========== ===========
Basic earnings per share $ 0.46 $ 0.42 $ 1.21 $ 1.14
Diluted earnings per share 0.43 0.39 1.13 1.07
Trailing 12-month diluted EPS 1.48
Average shares outstanding 2,627,541 2,664,224 2,635,498 2,662,472
Operating Ratios (through September 30)
Return on average assets 1.48% 1.59% 1.43% 1.47%
Return on average equity 16.01% 16.46% 14.71% 15.75%
Efficiency ratio (fully taxable equivalent) 51.00% 52.19% 53.99% 55.52%
Earnings per share have been adjusted for 5% stock dividends in 2002 and 2001.
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