EXHIBIT 99.1
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FOR IMMEDIATE RELEASE
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February 4, 2005
FOR MORE INFORMATION, CONTACT:
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John M. Lilly, Treasurer and Chief Financial Officer (413) 747-1465
Nasdaq Symbol - WBKC
WESTBANK CORPORATION REPORTS FOURTH QUARTER EARNINGS
West Springfield, MA -- Westbank Corporation (Nasdaq: WBKC) today reported net
income of $1,129,000 or $.23 per diluted share for the quarter ended December
31, 2004, versus the same quarter of 2003 when earnings totaled $1,625,000 or
$.33 per diluted share.
For the year ended December 31, 2004, net income totaled $4,611,000 or $.95 per
diluted share compared to $6,054,000 or $1.26 per diluted share for the year
ended December 31, 2003.
Earnings for the fourth quarter of 2004 included a provision for loan losses of
$75,000 versus no provision for the same quarter of 2003. During the most recent
quarter, the Corporation recorded a net loss on the sale of securities and loans
totaling $8,000 versus a net gain of $490,000 during the fourth quarter of 2003.
As previously reported during the third quarter, the Corporation's 2004 results
included the refinancing of the Corporation's Trust Preferred Securities, which
required a write-down of $807,000, and a write-down of equity securities deemed
to be other than temporarily impaired in the amount of $628,000.
Net interest income for the quarter and year ended December 31, 2004 totaled
$5,589,000 and $22,535,000 respectively versus $5,731,000 and $21,767,000 for
the quarter and year ended December 31, 2003 respectively. The net interest
margin for the year and quarter ended December 31, 2004 was 3.25% and 3.24%
respectively versus 3.53% and 3.56% for the same periods of 2003.
Non-interest income for the year and three months ended December 31, 2004 was
$3,084,000 and $749,000 respectively, as compared to $3,065,000 and $763,000 for
the same periods of 2003.
Operating expenses for the year and quarter ended December 31, 2004 totaled
$19,149,000 and $4,603,000 respectively compared to $17,439,000 and $4,504,000
for the same periods of 2003. Included in operating expenses for 2004 is the
$807,000 write-down related to the refinancing of the Corporation's prior Trust
Preferred Securities previously discussed.
As of December 31, 2004, assets totaled $756.4 million compared to $725.4
million at December 31, 2003, an increase of $31 million. Investments totaled
$274.3 million versus $242.1 million, an increase of $32.2 million or 13% over
year-end 2003. At year-end 2004, loans totaled $439.4 million compared to $440.8
million at December 31, 2003. During the twelve-month period ended December 31,
2004, the Corporation sold $23.6 million of residential real estate loans in the
secondary market. At December 31, 2004, deposits had grown to $590 million
versus $537.3 million one year ago, an increase of $52.7 million or 10%.
WESTBANK CORPORATION
For immediate release: February 4, 2005
Nasdaq Symbol - WBKC
Donald R. Chase, President and CEO, said, "During the past year, commercial,
commercial mortgage and commercial leasing activity grew by more than $20
million, or 11%, versus year-end 2003." According to Chase, "We believe the
increased commercial lending activity, along with the refinancing of our Trust
Preferred Securities, will be the impetus needed to begin 2005 on a positive
note."
"The refinancing of the Trust Preferred Securities is expected to save the
Corporation $787,000 annually, based on the initial interest rates," Chase said.
As of December 31, 2004, the allowance for loan losses totaled $4,356,000,
representing .99% of the loans, while non-performing loans totaled $2,135,000,
and the Corporation held one property as other real estate owned totaling
$630,000. At December 31, 2004, non-performing assets represented 0.37% of total
assets.
Stockholders' equity at December 31, 2004 totaled $47,462,000 compared to
$45,275,000 at December 31, 2003, representing a book value of $10.06 and a
tangible book value of $8.19. The results of the year ended December 31, 2004
represented a return on average assets of .62% and a return on average equity of
9.82%.
Westbank Corporation is the holding company for Westbank of West Springfield,
Massachusetts, a commercial bank and trust company operating 18 banking offices
in Massachusetts and Connecticut.
Statements included in this discussion and in future filings by Westbank
Corporation with the Securities and Exchange Commission, in Westbank Corporation
press releases and in oral statements made with the approval of an authorized
executive officer, which are not historical or current facts, are
"forward-looking statements" made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Such statements are subject to
certain risks and uncertainties that could cause actual results to differ
materially from historical earnings and those presently anticipated or
projected. Westbank Corporation wishes to caution readers not to place undue
reliance on such forward-looking statements that speak only as of the date made.
The following important factors, among others, in some cases have affected, and
could affect in the future, Westbank Corporation's actual results and could
cause Westbank Corporation's actual financial performance to differ materially
from that expressed in any forward-looking statement: (1) competitive pressures
among depository and other financial institutions may increase significantly;
(2) revenues may be lower than expected; (3) changes in the interest rate
environment may reduce interest margins; (4) general economic conditions, either
national or regional, may be less favorable than expected, resulting in, among
other things, a deterioration in credit quality and/or a reduced demand for
credit; (5) legislative or regulatory changes, including changes in accounting
standards, may adversely affect the business in which the Corporation is
engaged; (6) competitors may have greater financial resources and may have
developed products that enable such competitors to compete more successfully
than the Corporation; and (7) adverse changes may occur in the securities
markets or with respect to inflation. The foregoing list should not be construed
as exhaustive and Westbank Corporation disclaims any obligation to subsequently
revise any forward-looking statements to reflect events or circumstances after
the date of such statements or to reflect the occurrence of anticipated or
unanticipated events.
CONDENSED CONSOLIDATED BALANCE SHEETS
Westbank Corporation and Subsidiaries
December 31 (Unaudited)
(Dollar amounts in thousands) 2004 2003
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ASSETS
Cash and due from banks
Non-interest bearing $ 12,451 $ 14,599
Interest bearing 34 40
Federal funds sold 669 39
Securities held to maturity 112,424 250
Securities available for sale 161,855 241,812
Loans $ 439,369 $ 440,767
Less allowance for loan loss 4,356 4,428
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Net Loans 435,013 436,339
Bank premises and equipment 6,885 6,749
Other real estate owned - net 630
Intangible assets 8,837 8,837
Other assets 17,643 16,777
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TOTAL ASSETS $ 756,441 $ 725,442
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LIABILITIES AND EQUITY
Deposits
Non-interest bearing $ 84,758 $ 76,871
Interest bearing 505,274 460,439
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Total Deposits 590,032 537,310
Funds borrowed 97,354 122,204
Other liabilities 4,067 3,127
Mandatorily redeemable preferred stock 17,526 17,526
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Total Liabilities 708,979 680,167
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Stockholders' Equity
Common stock 9,493 9,047
Unearned compensation -
restricted stock award (1,652)
Additional paid in capital 20,377 14,524
Retained earnings 19,958 22,724
Treasury stock (606) (1,692)
Accumulated other comprehensive
(loss) income (108) 672
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Total Stockholders' Equity 47,462 45,275
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TOTAL LIABILITIES AND EQUITY $ 756,441 $ 725,442
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CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Westbank Corporation and Subsidiaries
December 31 (Unaudited)
(Dollar amounts in thousands, except per share data)
Quarter Ended Year Ended
2004 2003(1) 2004 2003(1)
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Income:
Interest and fees on loans $ 6,231 $ 6,653 $ 24,679 $ 28,529
Interest on federal funds sold 84 5 101 169
Interest on securities 2,698 2,433 12,029 7,154
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9,013 9,091 36,809 35,852
Interest expense 3,424 3,360 14,274 14,085
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Net interest income 5,589 5,731 22,535 21,767
Provision for (recovery of) loan losses 75 225 (354)
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Net interest income after provision 5,514 5,731 22,310 22,121
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(Loss)/gain on securities (45) 574 (121) 1,138
Gain/(loss) on sale of loans 37 (84) 478 333
Other non-interest income 749 763 3,084 3,065
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Total non-interest income 741 1,253 3,441 4,536
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Operating Expenses:
Salaries and benefits 2,586 2,426 10,393 9,741
Other operating expenses 1,680 1,676 7,186 6,107
Occupancy - net 337 402 1,570 1,591
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Total operating expenses 4,603 4,504 19,149 17,439
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Income before income taxes 1,652 2,480 6,602 9,218
Income taxes 523 855 1,991 3,164
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Net Income $ 1,129 $ 1,625 $ 4,611 $ 6,054
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Earnings per share
- Basic $ 0.24 $ 0.35 $ 1.00 $ 1.32
- Diluted $ 0.23 $ 0.33 $ 0.95 $ 1.26
Weighted average shares outstanding
- Basic 4,704,917 4,624,461 4,606,094 4,597,930
- Diluted 4,951,172 4,875,749 4,863,741 4,798,656
(1) Share amounts and earnings per share are adjusted for the 5% stock dividend
declared and distributed in May 2004.