Exhibit 99.1
Quaker City Bancorp, Inc. Reports Earnings
for First Quarter Fiscal 2004 and Cash Dividend
WHITTIER, Calif.--(BUSINESS WIRE)--Oct. 21, 2003--Quaker City
Bancorp, Inc. ("Company") (Nasdaq: QCBC), the holding company for
Quaker City Bank ("Bank"), reported net earnings of $5.4 million,
$0.84 per share for the quarter ended September 30, 2003, compared to
$5.6 million, $0.83 per share for the quarter ended September 30,
2002, a 1.2% increase in earnings per share. The trailing twelve
months earnings per share at September 30, 2003 was $3.45 per share.
All per share earnings are presented on a diluted basis.
The Company also announced today that its Board of Directors, at
their meeting on October 16, 2003, declared a cash dividend of $0.20
per outstanding share of common stock of the Company payable on
November 28, 2003 to shareholders of record at the close of business
on November 14, 2003.
The decline in net earnings for the quarter ended September 30,
2003 was primarily due to the recognition of a one-time State of
California tax benefit of $158,000 during the quarter ended September
30, 2002. The increase in earnings per share was due to stock
repurchases during the last twelve months.
The net interest margin for the current reporting quarter was
3.67% compared to 3.89% for the same period last year, as the yield on
interest earning assets decreased more quickly than the cost of
interest bearing liabilities during the period.
Return on average assets (ROAA) decreased to 1.33% for the current
quarter compared to 1.51% for the same quarter ended September 30,
2002. The Company's return on average equity (ROAE) for the current
quarter decreased to 15.57% compared to 17.23% for the quarter ended
September 30, 2002. The Company's book value per share has increased
every quarter for the last four fiscal years. The book value per share
at September 30, 2003 was $22.37 as compared to $20.13 as of September
30, 2002, an 11.1% increase.
The Company experienced record loan prepayments and amortization
during the current quarter with an annualized payoff rate of 49.53%
compared to 26.07% for the same period last year. However, the
decrease in the loan portfolio was offset by purchases of
mortgage-backed securities and short-term investments resulting in
average earning assets at September 30, 2003 increasing to $1.57
billion compared to $1.47 billion at September 30, 2002, a 7.1%
increase. As a result of increased earning assets offset by a decrease
in net interest margin, net interest income before provision for loan
losses for the quarter remained constant, $14.5 million for the
current quarter and for the same quarter last year.
Deposit transaction accounts (checking, NOW, money-market and
passbooks) increased as a percentage of total deposits to 42.85% as of
September 30, 2003 compared to 35.38% one year earlier. Total other
income for the quarter ended September 30, 2003 increased to $2.9
million from $2.3 million for the same period last year, an increase
of 28.6%. The increase during the quarter was primarily due to an
increase in retail deposit fees to $1.5 million for the current
quarter (compared to $1.2 million for the same period last year) and
an increase in gain on sale of loans held-for-sale to $450,000
(compared to $112,000 for the same period last year).
Nonperforming loans at September 30, 2003 were reduced to $2.8
million, 0.21% of gross loans compared to $3.3 million, 0.25% of gross
loans at June 30, 2003. Real estate acquired through foreclosure (REO)
was $50,000 for the quarter ended September 30, 2003 and there was no
REO for the quarter ended June 30, 2003. Total nonperforming assets
decreased to $2.8 million, or 0.17% of assets at September 30, 2003,
compared to $3.3 million, 0.20% of total assets as of June 30, 2003.
The Company includes as nonperforming assets nonaccrual loans 60 or
more days past due, troubled debt restructured loans and REO.
The ratio of general and administrative (G&A) expenses to average
assets was 1.88% for the current reporting quarter compared to 1.85%
for the same quarter last year. The increase was a result of costs
related to planned branch network expansion, branch computer
technology upgrades, and increased marketing expense. The efficiency
ratio for the current quarter increased to 44.19% compared to 41.18%
for the quarter ended September 30, 2002. The efficiency ratio is the
measurement of G&A expense as a percentage of net interest income
before provision for loan losses and noninterest income.
The Company had $1.64 billion in total assets at September 30,
2003, and operates twenty-four retail banking branches in Los Angeles,
Orange, Riverside and San Bernardino Counties in southern California.
The bank is currently scheduled to open three additional Wal-Mart
in-store branches in the communities of Temecula, San Marcos and La
Quinta (Palm Springs area) during fiscal 2004. The La Quinta branch
will be located in what is scheduled to be Wal-Mart's first "super
center" in California. At September 30, 2003, consolidated
stockholders' equity of the Company was $141.2 million, representing
8.60% of total assets. The Bank was founded in 1920 and its regulatory
capital levels continue to exceed the levels necessary to be
considered "Well Capitalized."
Pursuant to previously announced plans to repurchase Company
stock, the Company acquired in the open market 66,500 shares of common
stock at an average price of $39.80 during the quarter ended September
30, 2003. The Board of Directors has authorized the repurchase of
Company stock up to 356,567 shares of common stock.
As previously announced, President and Chief Executive Officer
Rick McGill will be hosting a telephone conference call to discuss the
results of the first quarter and to answer questions of callers today,
October 21, 2003 at 4:00 pm Eastern Time (1:00 pm Pacific). The
teleconference dial-in number is (800) 450-0819. Please phone in no
later than 3:55 pm Eastern Time today to participate. There will be a
replay of the call available beginning at 5:45 pm Eastern Time on the
21st and ending at 2:59 am Eastern Time on October 28, 2003. The
replay dial-in number is (800) 475-6701, access code 702073.
These statements are subject to a number of risks and
uncertainties, many of which are beyond the control of the Company,
including, but not limited to, (i) general economic, market or
business conditions in the U.S. and southern California, including
changes in market interest rates; (ii) real estate market conditions,
particularly in southern California; (iii) the opportunities (or lack
thereof) that may be presented to and pursued by the Company; (iv)
competitive actions by other financial institutions; (v) changes in
federal, state, and local laws, regulations and policies affecting the
Company's business; and (vi) other factors. Actual results could
differ materially from those contemplated by these forward-looking
statements. Consequently, all of the forward-looking statements made
in this report are qualified by these cautionary statements and there
can be no assurance that the actual results or developments
anticipated by the Company will be realized or, even if substantially
realized, that they will have the expected consequences to or effects
on the Company and its business or operations. Forward-looking
statements made in this report speak as of the date hereof. The
Company undertakes no obligation to update or revise any
forward-looking statement made in this report.
Quaker City Bancorp, Inc.
Consolidated Statements of Financial Condition
(Nasdaq: QCBC)
Unaudited
(Dollars in thousands, except share data)
September 30, June 30,
2003 2003
Assets
Cash and due from banks $33,103 $31,275
Interest-bearing deposits 1,801 943
Federal funds sold and other short-term
investments 16,000 --
Investment securities held-to-maturity 12,140 12,178
Investment securities available-for-sale 48,132 48,137
Loans receivable, net 1,294,434 1,323,268
Loans receivable held-for-sale 800 2,997
Mortgage-backed securities held-to-
maturity 112,168 90,014
Mortgage-backed securities available-for-
sale 83,542 73,683
Real estate held-for-sale 50 --
Federal Home Loan Bank stock, at cost 20,020 19,807
Office premises and equipment, net 7,383 7,275
Accrued interest receivable and other
assets 13,021 12,534
Total assets $1,642,594 $1,622,111
Liabilities and Stockholders' Equity
Deposits $1,097,557 $1,084,117
Federal Home Loan Bank advances 370,000 381,500
Accounts payable and accrued expenses 6,539 7,269
Other liabilities 27,253 10,088
Total liabilities 1,501,349 1,482,974
Stockholders' Equity:
Common stock, $.01 par value. Authorized
20,000,000 shares; issued and outstanding
6,314,993 shares and 6,365,943 at September
30, 2003 and June 30, 2003, respectively 63 64
Additional paid-in capital 129,276 128,581
Accumulated other comprehensive loss (1,792) (1,377)
Retained earnings, substantially
restricted 13,970 12,197
Deferred compensation (272) (328)
Total stockholders' equity 141,245 139,137
Total liabilities and stockholders'
equity $1,642,594 $1,622,111
Quaker City Bancorp, Inc.
Consolidated Statements of Operations
(Nasdaq: QCBC)
Unaudited
(Dollars in thousands, except per share data)
Three Months Ended
September 30,
2003 2002
Interest income:
Loans receivable $21,067 $22,010
Mortgage-backed securities 1,431 1,953
Investment securities 481 783
Other 249 266
Total interest income 23,228 25,012
Interest expense:
Deposits 5,175 6,711
Federal Home Loan Bank advances 3,600 3,790
Total interest expense 8,775 10,501
Net interest income before provision for
loan losses 14,453 14,511
Provision for loan losses -- 200
Net interest income after provision for loan
losses 14,453 14,311
Other income:
Deposit fees 1,459 1,161
Loan servicing charges and fees 662 618
Gain on sale of loans held-for-sale 450 112
Commissions 227 188
Gain on sale of securities
available-for-sale -- 41
Other 100 133
Total other income 2,898 2,253
Other expense:
Compensation and employee benefits 4,247 3,814
Occupancy, net 915 805
Federal deposit insurance premiums 111 108
Data processing 524 369
Advertising and promotional 491 352
Consulting fees 223 242
Other general and administrative expense 1,157 1,214
Total general and administrative expense 7,668 6,904
Amortization of core deposit intangible 29 29
Total other expense 7,697 6,933
Earnings before income taxes 9,654 9,631
Income taxes 4,220 3,996
Net earnings $5,434 $5,635
Average common shares outstanding 6,263,901 6,448,741
Shares outstanding and equivalents 6,459,467 6,765,055
Basic earnings per share $0.87 $0.87
Diluted earnings per share $0.84 $0.83
Quaker City Bancorp, Inc.
Consolidated Financial Highlights, Page 1
(Nasdaq: QCBC)
Unaudited
(Dollars in thousands, except share and per share data)
At September 30, At June 30,
2003 2003
Selected Financial Data
Total assets $1,642,594 $1,622,111
Total liabilities $1,501,349 $1,482,974
Loans receivable (1) $1,295,234 $1,326,265
Allowance for loan losses $11,606 $11,606
Investment securities (1) $60,272 $60,315
Mortgage-backed securities (1) $195,710 $163,697
Real estate held-for-sale $50 --
Deposits $1,097,557 $1,084,117
Federal Home Loan Bank (FHLB) advances $370,000 $381,500
Total stockholders' equity $141,245 $139,137
Total common shares outstanding 6,314,993 6,365,943
Trailing twelve month diluted earnings per
share $3.45 $3.43
Book value per common share $22.37 $21.86
Stock price at end of period $40.00 $41.59
(1) Includes assets held or available-for-sale.
At or for the
Three Months Ended
September 30,
2003 2002
Selected Operating Data
Net interest income before provision for
loan losses $14,453 $14,511
Provision for loan losses -- 200
Net interest income after provision for
loan losses 14,453 14,311
Total other income 2,898 2,253
Total other expense 7,697 6,933
Earnings before income taxes 9,654 9,631
Income taxes 4,220 3,996
Net earnings $5,434 $5,635
Basic earnings per share $0.87 $0.87
Diluted earnings per share $0.84 $0.83
Average earning assets $1,573,736 $1,469,901
Average loans receivable $1,310,459 $1,223,238
Average stockholders' equity $139,596 $130,843
Weighted average shares outstanding and
equivalents 6,459,467 6,765,055
Performance Ratios (2)
Return on average assets 1.33% 1.51%
Return on average equity 15.57% 17.23%
Average equity to average assets 8.53% 8.76%
Interest rate spread during the period 3.46% 3.59%
Net interest margin 3.67% 3.89%
General and administrative expense to
average assets 1.88% 1.85%
Efficiency ratio 44.19% 41.18%
Other expense to average assets 1.88% 1.86%
(2) All applicable quarterly ratios reflect annualized figures.
Quaker City Bancorp, Inc.
Consolidated Financial Highlights, Page 2
(Nasdaq: QCBC)
Unaudited
(Dollars in thousands, except share and per share data)
At At
Asset Quality Ratios and Data September 30, June 30,
2003 2003
Nonperforming loans as a percentage of gross
loans (3) 0.21% 0.25%
Nonperforming assets as a percentage of total
assets (4) 0.17% 0.20%
Total allowance for loan losses as a percentage
of gross loans 0.89% 0.86%
Total allowance for loan losses as a percentage
of total nonperforming loans 417.03% 350.95%
Total allowance as a percentage of total
nonperforming assets (5) 409.67% 350.95%
Net charge-offs, quarter to date $-- $--
Nonaccrual loans (3) $2,783 $3,307
Troubled debt restructured loans -- --
Total nonperforming loans 2,783 3,307
Real estate acquired through foreclosure 50 --
Total nonperforming assets $2,833 $3,307
Number of:
Pass Book/Savings Accounts 20,007 19,231
Checking Accounts 39,417 37,478
Money Market Accounts 7,200 7,589
(3) Nonperforming loans are net of specific allowances and include
nonaccrual and troubled debt restructured loans. Gross loans
include loans held-for-sale.
(4) Nonperforming assets include nonperforming loans and REO.
(5) Total allowance includes loan and REO valuation allowances.
For investor information, visit Quaker City's Corporate News on
the Net page at www.businesswire.com/cnn/qcbc.htm
CONTACT: Quaker City Bancorp, Inc., Whittier
Rick McGill, 562-907-2275
Dwight L. Wilson, 562-907-2241