Exhibit 99.1
CCBT Financial Companies, Inc. Report 2003 Third Quarter and
Year-to-Date Earnings
SOUTH YARMOUTH, Mass.--(BUSINESS WIRE)--Oct. 16, 2003--CCBT
Financial Companies, Inc. (NASDAQ: CCBT) Chief Executive Officer and
President Stephen B. Lawson announced third quarter 2003 earnings of
$2.3 million, or $.27 per share, as compared to $3.9 million, or $.45
per share, earned in the same prior year period. For the nine months
ended September 30, 2003, the Company reported earnings of $5.2
million, or $.61 per share, as compared to $13.5 million, or $1.56 per
share in the same prior year period.
Mr. Lawson commented, "The three and nine month earnings in 2003
have been negatively affected by economic factors and several
significant events thus far this year. The historic lows in interest
rates and mortgage rates, in particular, have substantially
accelerated pre-payments on both residential mortgage loans and
investment securities backed by housing collateral, resulting in
reinvestment of principal proceeds at much lower rates. This has also
accelerated the write-off of deferred costs and mortgage servicing
rights on residential mortgage loans and hastened the amortization of
premiums paid on mortgage related investment securities. During the
third quarter, we extended the hours of operations in our full service
financial offices, opened a financial center in Mashpee Commons,
worked toward completing our Pine Hills office and closed nine
transaction locations in Stop & Shop supermarkets. The write-down of
leasehold improvements and expenses incurred, in these efforts, are
reflected in non-interest income-Other Loss and in the non-interest
expense categories. Our nine-month earnings results also reflect the
impact of these factors and events, as well as the previously
disclosed settlement of the REIT tax issue with the Massachusetts
Department of Revenue and losses from the impairment and sale of
investment securities. Net interest income reported for both the
quarter and year-to-date have decreased from the combination of
earning asset yields having declined faster than our ability to lower
funding costs, the accelerated write-down of residential mortgage
deferred costs and the accelerated amortization of premiums on
investment securities. The third quarter returns on average equity and
assets, respectively, were 8.09% and 0.69% for 2003 as compared to
12.87% and 1.05% for the same period in 2002. For the nine months
ended September 30, 2003, returns on average equity and assets,
respectively, were 6.13% and 0.52%, as compared to 15.25% and 1.26%,
in the 2002 comparable period.
"In 2003, our focus has been on upgrading, expanding and
realigning our full service office locations, growing our sales
associate staff and intensifying their training and education to
increase non-interest income through growing fee-based revenue. All of
CCBT's offices are now capable of providing our customers with the
full range of financial offerings including banking, investment,
brokerage, insurance, tax, estate and trust services and the number of
staff attaining financial designations, including CPA, CFA, CFP, and
brokerage and insurance licensing, is increasing steadily. These
efforts have been successful as measured by the increase in income
from financial service products (financial advisory, brokerage and
insurance sales) from $2.7 to $3.1 million or 15.2% for the
comparative quarters and from $7.9 to $9.3 million or 18.3% for the
comparative nine months, after excluding the $398,000 adjustment in
the second quarter of 2002 for the one-time recognition of deferred
insurance commissions. Our strategy of providing a wide range of
financial services to meet all the needs of our clients from under one
roof will continue to be our foremost goal.
"Recent economic data points to an improvement in the U.S.
economy, and recent increases in mortgage rates should contribute to
stabilizing net interest spreads and margins at current levels. This
has been a difficult year due to the results of historically low
interest rates and our continued realignment as we refocus our
business to include financial services. However, we believe that the
worst is behind us and look forward to improving earnings in the next
quarter and beyond."
Total assets have decreased to $1.35 billion at September 30, 2003
from $1.62 billion at September 30, 2002 driven by reductions in
residential mortgage loans and housing-related investment securities.
In this low rate environment, residential mortgage borrowers have
refinanced from adjustable-rate to fixed-rate mortgages, which are
sold to mitigate future interest rate risk. While residential mortgage
loans have decreased $144 million, commercial and home equity loans
were up $31 million and $15 million, or 7.4% and 23.6%, respectively,
from a year ago. The quality of the loan portfolio remains strong as
total non-performing assets declined from $3.5 million to $3.3 million
at September 30, 2002 and 2003, respectively. The allowance for loan
losses was $12.8 million on September 30, 2003, up modestly from $12.4
million a year ago. As loans and investments have declined, borrowings
have decreased $250 million. This funding decline has been partially
offset by deposit increases of $56 million or 5.7% from the September
30, 2002 levels. The deposit growth reflects organic growth in core
deposits as the year-round Cape Cod region population continues to
increase. The capital to assets ratio stands at 8.4% and 7.4%,
respectively, at September 30, 2003 and 2002. We recorded positive
results in the growth of our commercial loans and core deposits while
maintaining asset quality and a strong capital position. CCBT
Financial Companies, Inc. recently declared a $0.19 quarterly dividend
to be paid October 31, 2003 to stockholders of record on October 20,
2003.
CCBT Financial Companies, Inc. is a bank holding company with
total assets of $1.3 billion on September 30, 2003. Its subsidiary,
Cape Cod Bank and Trust Company, N.A., owns CCBT Brokerage Direct and
a 51% interest in Murray & MacDonald Insurance Services, Inc. The
Company offers a wide range of financial products and services
including deposit services, loans, municipal services, insurance,
trust, investments, tax and retirement services to individuals,
municipalities and businesses. To find out more about CCBT Financial
Companies, Inc. and our services, please visit our web site at
www.ccbt.com or visit one of our twenty-six full service office
locations.
This report may contain statements that are not historical facts
and are considered forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements
relate to, among other things, future financial results of the
Company. You should not rely on forward-looking statements because the
Company's actual results may differ materially from those indicated by
these forward-looking statements as a result of a number of important
factors. These factors include, but are not limited to, changes in
prevailing interest rates and increases in mortgage prepayments which
may reduce interest margin, changes in national and local economic
conditions and equity and fixed income market fluctuations. Reference
is made to the Company's filings on Forms 10-K with the Securities and
Exchange Commission for factors that could cause actual results to
differ materially from those anticipated.
Our Form 10-Q filing with the SEC, which will be available on our
web site, will contain more detailed financial information.
ASSETS ($000) 09/30/03 12/31/02 09/30/02
Cash & cash equivalents 99,214 60,798 101,919
Securities available for sale 356,567 510,837 565,990
Securities held to maturity 51,767 0 0
Other securities 24,738 24,738 24,738
Construction loans 98,672 99,544 102,369
Commercial mortgages 296,984 283,458 280,808
Commercial loans 86,399 84,882 83,235
Residential mortgages 206,648 262,095 335,709
Home equity loans 78,927 65,794 63,865
Other consumer loans 4,582 5,629 5,992
Total portfolio loans 772,212 801,402 871,978
Loans held for sale 7,997 37,332 14,084
Loan loss reserve (12,771) (12,384) (12,422)
Goodwill 803 803 803
Other intangibles 4,756 5,511 6,045
Total intangible assets 5,559 6,314 6,848
Mortgage servicing rights 2,826 2,088 1,729
Real estate owned 1,500 1,500 1,500
Other assets 43,304 49,258 44,779
Total assets 1,352,913 1,481,883 1,621,143
LIABILITIES ($000)
Savings/NOW accounts 289,417 259,587 251,618
Money market deposits 318,605 294,295 311,458
Other consumer time 113,623 121,961 127,223
Time deposits over $100,000 41,247 37,344 38,946
Short-term borrowings 57,322 227,091 298,491
Long-term borrowings 141,898 170,750 150,918
Total interest-bearing liab. 962,112 1,111,028 1,178,654
Demand deposits 266,927 229,033 244,643
Minority interest 316 234 310
Other liabilities 9,788 23,141 78,126
Total liabilities 1,239,143 1,363,436 1,501,733
EQUITY ($000)
Common equity 113,770 118,447 119,410
Net unrealized loss
on AFS securities (2,039) (1,018) (713)
Book value per share 13.51 13.79 13.90
Common shares issued 9,061,064 9,061,064 9,061,064
Treasury shares (640,866) (470,266) (471,766)
Common shares outstanding 8,420,198 8,590,798 8,589,298
INCOME STATEMENT ($000) Third Third YTD 03 YTD 02
Quarter 03 Quarter 02
Interest income 13,951 19,623 45,015 58,537
Interest expense 4,055 6,884 13,719 20,699
Net interest income 9,896 12,739 31,296 37,838
Net interest income (FTE) 9,965 12,824 31,526 38,105
Loan loss provision 0 0 0 0
(Loss) gain on securities 0 538 (1,692) 3,179
Financial advisor fees 1,884 1,676 5,824 5,142
Service charge on deposits 590 553 1,805 1,679
Gain on sale of loans 907 571 3,072 1,647
Other noninterest income 2,412 2,491 7,610 7,670
Total noninterest income 5,793 5,829 16,619 19,317
Employee salaries and
benefits 6,450 7,249 18,798 20,412
Occupancy and equipment 1,400 1,596 4,587 4,659
Foreclosed property expense 19 (4) 54 61
Amortization of intangibles 322 324 967 972
Deposit insurance expense 41 41 124 123
Other noninterest expense 3,668 3,423 10,876 10,445
Total noninterest expense 11,900 12,629 35,406 36,672
Net income before taxes 3,789 5,939 12,509 20,483
Tax provision 1,514 2,034 7,307 6,996
Net income 2,275 3,905 5,202 13,487
Basic EPS 0.27 0.45 0.61 1.56
Diluted EPS 0.27 0.45 0.61 1.56
Dividends per common share 0.19 0.19 0.57 0.57
Avg shares for basic EPS 8,420 8,611 8,478 8,621
Avg shares for diluted EPS 8,449 8,646 8,501 8,658
AVE. BALANCE SHEET ($000) Third Third YTD 03 YTD 02
Quarter 03 Quarter 02
Taxable securities 438,879 512,940 448,637 457,820
Tax-exempt securities 20,817 18,111 22,274 18,346
Total portfolio loans 764,773 887,214 775,357 882,709
Loans held for sale 19,705 6,507 14,601 5,162
Other earning assets 0 0 0 0
Total earning assets 1,244,174 1,424,772 1,260,869 1,364,037
Total assets 1,316,235 1,488,277 1,331,482 1,430,011
Savings/NOW accounts 286,616 245,801 270,167 232,966
Money market deposits 303,397 298,687 296,267 282,776
Other consumer time 114,572 128,504 117,836 137,120
Time deposits over $100,000 39,575 38,913 38,900 42,921
Total interest-bearing
deposits 744,160 711,905 723,170 695,783
Short-term borrowings 54,115 254,437 122,844 250,376
Long-term borrowings 135,330 152,319 129,668 138,212
Total interest-bearing liab. 933,605 1,118,661 975,682 1,084,371
Demand deposits 270,614 241,870 237,884 219,072
Minority interest 309 312 316 310
Other liabilities (751) 6,072 4,419 8,351
Total liabilities 1,203,777 1,366,915 1,218,301 1,312,104
Common equity 112,458 121,362 113,181 117,907
Return on average assets 0.69% 1.05% 0.52% 1.26%
Return on average equity 8.09% 12.87% 6.13% 15.25%
CHARGEOFFS ($000) Third Third YTD 03 YTD 02
Quarter 03 Quarter 02
Loan chargeoffs (20) (84) (56) (137)
Recoveries 111 119 443 307
Net loan charge-offs
(recoveries) (91) (35) (387) (170)
ASSET QUALITY ($000) 09/30/03 12/31/02 09/30/02
Nonaccrual loans 1,836 1,348 1,999
Renegotiated loans 200 210 213
Other real estate owned 1,500 1,500 1,500
Total nonperforming assets 3,336 2,848 3,499
SUPPLEMENTAL DATA 09/30/03 12/31/02 09/30/02
Loans serviced f/others
($000) 418,551 322,085 244,421
FTE employees 390 402 405
Number of full service
offices 26 34 31
Number of subsidiaries 2 2 2
Number of ATM's 34 42 41
CONTACT: CCBT Financial Companies, Inc.
Phillip W. Wong, 508-760-8306