UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 19, 1998
Heritage Commerce Corp
(Exact name of registrant as specified in its charter)
CA 00-23877 77-0469558
(State of other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
150 Almaden Blvd., San Jose, CA 95113
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 947-6900
None
Former name or former address, if changed since last report.)
Item 5. Other Events
Heritage Commerce Corp
For immediate release: October 19, 1998
For additional information contact:
John E. Rossell, President and CEO (408) 947-6900
Rebecca Levey, Vice President/Marketing (408) 494-4513
Press Release
HERITAGE COMMERCE CORP ANNOUNCES OUTSTANDING RESULTS FOR THIRD QUARTER 1998
Heritage Commerce Corp, holding company for Heritage Bank of Commerce, today
announced record results for third quarter 1998, ended September 30, 1998.
Highlights include:
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- - TOTAL ASSETS of $399 million, up 56% over the $255 million reported at 9-30-
97.
- - TOTAL LOANS of $222 million, up 104% over the $109 million reported at 9-30-
97.
- - TOTAL DEPOSITS of $364 million, up 58% over the $231 million reported at 9-
30-97.
- - NET INCOME of $574 thousand, up 34% over the $429 thousand reported for the
quarter ended 9-30-97.
- - BASIC EARNINGS PER SHARE of $.16, up 23% over the $.13 reported for the
quarter ended 9-30-97.
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John Rossell, Heritage Commerce Corp President and CEO stated, "Our most
significant strategic initiatives, launched at the beginning of the year,
continue to contribute to our core business to bring about record results in
asset, loan and deposit growth, as well as in both quarterly net income and
earnings per share. Our Fremont branch operation continues to grow both its
loan and deposit bases, which at quarter-end September 30, 1998 stood at $26.5
million and $28.0 million, respectively. The branch was opened in mid February
to pave the way for a bank now in organization and pending regulatory approval.
Upon receipt of approval from the Department of Financial Institutions and the
Federal Deposit Insurance Corporation, this new subsidiary bank will be
chartered with the name HERITAGE BANK EAST BAY."
"In July of 1998, Heritage Commerce Corp completed a $6 million public offering
of Heritage Commerce Corp common stock at $15.50 per share, the proceeds of
which are intended primarily to capitalize the pending subsidiary bank,"
continued Rossell. "We are pleased to report that the offering was closed
after just five weeks, being oversubscribed by more than $3 million.
Concurrent with the close of the offering, Heritage Commerce Corp became a
listed company on the NASDAQ National Market under the symbol 'HTBK'."
For the nine months ended September 30, 1998, Heritage Commerce Corp has
reported $1,557,000 in earnings (restated to reflect the capitalization of
certain common stock offering costs), compared to $1,141,000 for the same
period of 1997, an increase of 36%.
"In addition, Heritage Bank of Commerce opened a Loan Production Office (LPO)
in the city of San Ramon on September 21, 1998," stated Rossell. "The
establishment of the LPO is in keeping with Heritage's commitment to
establishing a strong presence in the East Bay. A determining factor in our
decision to open an LPO in the I680/580 corridor was our ability to attract
established and highly seasoned bankers and commercial lenders, Frank Brito and
Leslie Rocha, who are well known in the East Bay. Joining Frank Brito and
Leslie Rocha is Herb von Goetz, who is presently a commercial lender in the
Bank's Fremont Office."
Heritage Commerce Corp is the holding company for Heritage Bank of Commerce, a
full-service independent community business bank, headquartered in downtown San
Jose, with one branch office located in the city of Fremont. The Bank caters
to the banking needs of small and medium-sized businesses and the individuals
who own and operate those businesses. Heritage is an active commercial and
residential construction lender, asset based lender and Small Business
Administration Guaranteed (SBA) lender. The Bank also originates home loans.
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Forward Looking Statement Disclaimer
This release may contain forward-looking statements that are subject to risks
and uncertainties. Such risks and uncertainties may include but are not
necessarily limited to fluctuations in interest rates, inflation, government
regulations and general economic conditions, and competition within the
business areas in which the Company is conducting its operations, including the
real estate market in California and other factors beyond the Company's
control. Such risks and uncertainties could cause results for subsequent
interim periods or for the entire year to differ materially from those
indicated. For a discussion of factors which could cause results to differ,
please see the Company's reports on Forms 10-K and 10-Q as filed with the
Securities and Exchange Commission and the Company's press releases. Readers
should not place undue reliance on the forward-looking statements, which
reflect management's view only as of the date hereof. The Company undertakes
no obligation to publicly revise these forward-looking statements to reflect
subsequent events or circumstances.
- -END-
Heritage Commerce Corp
3 Months Ended YTD
September 30 September 30
1998 1997 1998 1997
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Statement of Income Data
Net Interest Income $5,200 $3,149 $13,468 $8,416
Provision for loan losses 550 240 1,060 605
Noninterest Income 516 225 782 414
Noninterest Expense 4,078 2,472 10,628 6,467
Net Income $ 574 $ 429 $ 1,557 $1,141
Share Data
Earnings Per Share
Primary $ 0.16 $ 0.13 $ 0.42 $ 0.35
Fully Diluted $ 0.14 $ 0.12 $ 0.37 $ 0.33
Book Value Per Common Share $ 8.27 $ 6.64 $ 8.27 $ 6.64
Shares Outstanding 3,689,946 3,292,896 3,689,946 3,292,896
Balance Sheet Data
Total Assets $ 399,080 $255,332
Securities, Held-To-Maturity 27,717 23,529
Securities, Available-For-Sale 68,031 77,253
Total Loans, Gross 221,998 108,823
Allowance for Loan Losses 3,402 1,959
Total Deposits 363,869 231,473
Total Shareholders' Equity 30,513 21,876
Securities Unrealized Holding Gain, Net $ 1,142 $ 397
Nonperforming Loans $ 0 $ 0
Other Real Estate Owned $ 0 $ 0
Selected Financial Ratios
Net Interest Margin 6.34% 6.07%
Return on Average Assets 0.67% 0.76%
Return on Average Equity 8.49% 7.31%
Allowance For Loan Losses to Total Loans 1.53% 1.80%
Allowance For Loan Losses to NPL's N/A N/A
Allowance For Loan Losses to NPA's N/A N/A
Leverage Ratio 7.65% 8.57%
Additional Exhibits (Use this for filing press releases concerning dividend
payments and such)
SIGNATURES
Under the requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: October 19, 1998
HERITAGE COMMERCE CORP
By: /s/ Lawrence D. McGovern
Lawrence D. McGovern
Chief Financial Officer (Principal
Financial and Accounting Officer)