EXHIBIT 99.1
Sacramento, CA - January 20, 2004--American River Holdings (Nasdaq: AMRB),
announced record financial results for the year ended December 31, 2003. Net
income increased to $4,741,000 ($1.10 diluted earnings per share), marking the
highest earnings in the history of American River Holdings, and a 6.3% increase
from the $4,459,000 ($1.05 diluted earnings per share) reported for 2002. Total
assets were $397,393,000, up 16.0% from the $342,563,000 at December 31, 2002.
When comparing the year ended December 31, 2003 to the same period in 2002, net
interest income grew by 11.9% to $16,866,000 from $15,073,000. Noninterest
income decreased slightly to $2,253,000 from $2,323,000 in 2002. The decrease in
noninterest income was related to a $74,000 decrease in fees from brokering
equipment leases. Noninterest expense increased to $10,372,000 from $9,389,000
recorded in 2002. The increase in overhead was centered in three areas: human
resource costs, professional fees and other operating expenses. The increase in
human resources was $640,000 and included normal raises, higher incentives, new
hires and higher commissions for mortgage originations, workers compensation and
health insurance. The professional fees were up $74,000 resulting from legal
fees related to compliance with Sarbanes Oxley, merging subsidiary companies, as
well as, a variety of normal legal matters. Other operating expenses were up
$290,000 including increases in directors' expenses, lease servicing fees and
increases in operating losses (the operating losses were only $8,000 for 2003;
2002 included a recovery of $80,000 in losses originally recorded in 2001). The
2003 provision for loan and lease losses increased $302,000 to $946,000,
compared to $644,000 in 2002. The allowance for loan and lease losses at
December 31, 2003 was $3,949,000.
Return on average assets for 2003 was 1.31%, compared to 1.44% in 2002. Return
on average equity for the year ended December 31, 2003 was 14.17% compared to
15.11% in 2002 and the efficiency ratio was 53.77% compared to 53.47%. Credit
quality remained strong; net chargeoffs for the year were 0.08% of average loans
and leases. The allowance for loan and lease losses was 1.48% of total loans and
leases, while non-performing loans and leases were just 0.07% of ending loans
and leases.
Loans and deposits increased significantly during 2003. Net loans grew 14.6%
from $229,008,000 at December 31, 2002 to $262,464,000 at December 31, 2003.
Total deposits were up $46.7 million (or 16.9%), from $275,796,000 at December
31, 2002 to $322,507,000 at December 31, 2003. Noninterest bearing deposits
increased 24.8% from $81,974,000 at December 31, 2002 to $102,308,000 at
December 31, 2003. "We are proud of the great relationships we have with our
depositors and borrowers and the new relationships that our team fostered in
2003. These relationships led to the 15% growth in loans and 17% increase in
deposits," said David Taber, President and CEO of American River Holdings.
The Company achieved its eightieth consecutive profitable quarter. Net income
for the quarter was $1,129,000 compared to the $1,271,000 recorded in the fourth
quarter of 2002. Net interest income was $4,244,000 compared to $4,047,000 in
the same quarter in 2002. Noninterest income for the fourth quarter was $517,000
compared to $660,000 in the same period during the previous year. For the
quarter, noninterest expense increased from $2,472,000 to $2,670,000. The return
on average assets for the fourth quarter was 1.16%, which is a decrease from the
1.48% recorded for the previous year. Return on average equity also decreased to
12.88% from the 16.21% recorded for the fourth quarter in 2002. The efficiency
ratio for the fourth quarter was 55.54%, an increase from the 52.07% recorded
during the same period in 2002.
American River Bank increased assets, deposits and loans for the year ended
December 31, 2003. Assets were up 12.1% to $318,201,000 from the $283,867,000
recorded at December 31, 2002.
Page 4 of 7 Pages
Deposits increased to $250,613,000 up 12.3% from the $223,152,000 recorded at
the end of the fourth quarter in 2002. Loans increased to $208,769,000 (12.9%)
from the $184,929,000 recorded at December 31, 2002.
North Coast Bank, now a division of American River Bank following their
consolidation at the close of business on December 31, 2003, also had
significant increases in assets, deposits and loans. At December 31, 2003,
assets were up 25.4% to $78,477,000 from the $62,606,000 recorded at December
31, 2002. Deposits increased by 36.4% to $72,485,000 at December 31, 2003 from
the $53,151,000 recorded at December 31, 2002. Loans increased to $53,695,000,
up 21.8% from the $44,079,000 recorded at December 31, 2002.
American River Holdings is a financial services company and the parent company
of American River Bank, a community business bank that operates a family of
financial service providers. These providers include: American River Bank, with
offices in Sacramento and Placer Counties; North Coast Bank, with offices in
Sonoma County and first source capital, a lease financing company based in
Sacramento.
Related websites include www.amrb.com, www.americanriverbank.net,
www.northcoastbank.com and www.firstsourcecapital.com
Unaudited financial statements are attached. Historical earnings per share have
been adjusted for a 3 for 2 stock split in 2003 and a 5% stock dividend in 2002.
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, changes in
the interest environment including interest rates charged on loans, earned on
securities investments and 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 conduct of the war on terrorism,
the threat of terrorism or the impact of potential military conflicts and the
conduct of war on terrorism by the United States and its allies, as well as
other factors. To gain a more complete understanding of the uncertainties and
risks involved in the Company's business, this press release should be read in
conjunction with the Company's annual report on Form 10-K for the year ended
December 31, 2002.
Page 5 of 7 Pages
AMERICAN RIVER HOLDINGS FINANACIAL SUMMARY
CONSOLIDATED BALANCE SHEET (unaudited)
December 31 December 31
ASSETS 2003 2002
------------ ------------
Cash and due from banks $ 29,797,000 $ 25,899,000
Federal funds sold -- --
Interest-bearing deposits in banks 4,650,000 5,938,000
Investment securities 91,392,000 75,623,000
Loans and leases, net 262,464,000 229,008,000
Bank premises and equipment 1,505,000 1,665,000
Accounts receivable servicing receivable, net 1,778,000 1,396,000
Accrued interest and other assets 5,807,000 3,034,000
------------ ------------
$397,393,000 $342,563,000
============ ============
LIABILITIES & EQUITY
Noninterest bearing deposits $102,308,000 $ 81,974,000
Interest checking, money market & savings 148,578,000 121,436,000
Time deposits 71,621,000 72,386,000
------------ ------------
Total deposits 322,507,000 275,796,000
------------ ------------
Short-term borrowings 34,600,000 30,550,000
Long-term debt 1,942,000 1,992,000
Accrued interest and other liabilities 2,887,000 2,499,000
------------ ------------
Total liabilities 361,936,000 310,837,000
Total equity 35,457,000 31,726,000
------------ ------------
$397,393,000 $342,563,000
============ ============
Nonperforming loans and leases to total loans and 0.07% 0.09%
leases
Net chargeoffs to average loans and leases 0.08% 0.03%
Allowance for loan and lease losses to total loans and 1.48% 1.38%
leases
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
FOURTH FOURTH FOR THE YEAR ENDED
QUARTER QUARTER DECEMBER 31
2003 2002 2003 2002
----------- ----------- ----------- -----------
Interest income $ 4,943,000 $ 4,902,000 $19,768,000 $18,585,000
Interest expense 699,000 855,000 2,902,000 3,512,000
----------- ----------- ----------- -----------
Net interest income 4,244,000 4,047,000 16,866,000 15,073,000
Provision for loan and lease losses 282,000 150,000 946,000 644,000
Total noninterest income 517,000 660,000 2,253,000 2,323,000
Total noninterest expense 2,670,000 2,472,000 10,372,000 9,389,000
----------- ----------- ----------- -----------
Income before taxes 1,809,000 2,085,000 7,801,000 7,363,000
Income taxes 680,000 814,000 3,060,000 2,904,000
----------- ----------- ----------- -----------
Net income $ 1,129,000 $ 1,271,000 $ 4,741,000 $ 4,459,000
=========== =========== =========== ===========
Basic earnings per share $ 0.28 $ 0.32 $ 1.19 $ 1.13
Diluted earnings per share 0.26 0.30 1.10 1.05
Net interest margin as a percentage 4.83% 5.14% 5.10% 5.43%
- ----------------------------------------------------------------------------------------------------------
Operating Ratios:
Return on average assets 1.16% 1.48% 1.31% 1.44%
Return on average equity 12.88% 16.21% 14.17% 15.11%
Efficiency ratio (fully taxable equivalent) 55.54% 52.07% 53.77% 53.47%
- ----------------------------------------------------------------------------------------------------------
Earnings per share have been adjusted for a 3 for 2 split in 2003 and a 5% stock
dividend in 2002.
Page 6 of 7 Pages
CONSOLIDATED STATEMENT OF INCOME FOURTH THIRD SECOND FIRST
Trailing Four Quarters QUARTER QUARTER QUARTER QUARTER
(Unaudited) 2003 2003 2003 2003
----------- ----------- ----------- -----------
Interest income $ 4,943,000 $ 4,953,000 $ 5,062,000 $ 4,810,000
Interest expense 699,000 687,000 763,000 753,000
----------- ----------- ----------- -----------
Net interest income 4,244,000 4,266,000 4,299,000 4,057,000
Provision for loan and lease losses 282,000 252,000 223,000 189,000
Total noninterest income 517,000 645,000 565,000 526,000
Total noninterest expense 2,670,000 2,587,000 2,456,000 2,659,000
----------- ----------- ----------- -----------
Income before taxes 1,809,000 2,072,000 2,185,000 1,735,000
Income taxes 680,000 812,000 882,000 686,000
----------- ----------- ----------- -----------
Net income $ 1,129,000 $ 1,260,000 $ 1,303,000 $ 1,049,000
=========== =========== =========== ===========
Basic earnings per share $ 0.28 $ 0.32 $ 0.33 $ 0.27
Diluted earnings per share 0.26 0.29 0.30 0.25
Net interest margin as a percentage 4.83% 5.11% 5.28% 5.25%
- ----------------------------------------------------------------------------------------------------------
Quarterly Operating Ratios:
Return on average assets 1.16% 1.37% 1.46% 1.24%
Return on average equity 12.88% 14.84% 15.69% 13.29%
Efficiency ratio (fully taxable equivalent) 55.54% 52.23% 50.07% 57.52%
- ----------------------------------------------------------------------------------------------------------
Earnings per share have been adjusted for a 3 for 2 split in 2003
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