Exhibit 99.1
First Financial Bancorp Reports Continued Success with Strategic Plan
and Results of First Quarter 2004
LODI, Calif.--(BUSINESS WIRE)--April 13, 2004--First Financial
Bancorp (OTCBB:FLLC), the parent company of Bank of Lodi, N.A., today
reported continued double digit growth in each of its key strategic
areas -- Total Assets, Loans and Deposits. At March 31, 2004, total
assets increased $68 million, or 26%, to total $327 million, gross
loans increased $36 million, or 21%, to total $206 million and total
deposits increased $52 million, or 23% to total $279 million when
compared to March 31, 2003. For the first quarter of 2004, net income
totaled $567,000, or $0.30 per diluted share (adjusted for a 10% stock
dividend declared March 25, 2004) representing an increase of 66% over
prior year's first quarter income of $342,000.
"Now that we have grown to over $321 million in assets, the level
of income generated by our growth shows the value of our strategic
plan. Our current asset size allowed us to achieve a return on average
equity of over 11% and is an excellent step towards achieving our
plan," reported Leon Zimmerman, President and Chief Executive Officer.
"Our plan for growth and expansion continues to succeed and the
results are obviously enhancing shareholder value."
On April 9, 2004 the Company announced a 10% stock dividend
payable to shareholders of record on April 19, 2004. "Exceeding $321
million in assets at the end of last year was a great achievement
under the Company's strategic plan and the Board was desirous of
sharing that success with our shareholders," reported Zimmerman. "The
10% stock dividend also reflects our excitement about the first
quarter's performance and the future earnings capacity of the
Company."
Average earning assets and deposits continued to grow in 2004,
increasing 32.0% and 28.0%, respectively, over 2003. Compared to 2003,
net interest income in 2004 increased $551,000, or 21.0%, to
$3,180,000 from $2,629,000 in 2003. The increase is reflective of a
$647,000 increase in interest income minus an increase of $96,000 in
interest expense. The Company's average cost of funding its earning
assets decreased from 1.25% during the first quarter of 2003 to 1.08%
during the first quarter of 2004. As a result of the continued low
interest rate environment in 2004 when compared to 2003, the net
interest margin decreased to 4.62% for 2004 compared to 5.10% for
2003. Changes in the balance sheet mix and the decrease in general
interest rates as a result of actions undertaken by the Federal
Reserve, have resulted in net interest margin compression over the
past three years.
The provision for loan losses totaled $70,000 and $257,000 for the
quarters ending March 31, 2004 and 2003, respectively. Net charge-offs
for the period ending March 31, 2004 totaled $18,000 as compared to
$36,000 for the same period in 2003. At March 31, 2004, nonperforming
loans totaled $3,112,000 or 1.5% of gross loans as compared to
$3,880,000, or 2.1% at December 31, 2003 and $2,709,000, or 1.6% at
March 31, 2003. The ratio of the allowance for loan losses to gross
loans was 1.60% and 1.93% at March 31, 2004 and 2003, respectively.
"We are continuing to see favorable improvement in the resolution of
problem loans," reported Bob Daneke, the Company's Chief Operating
Officer. "As a result of the improvement we have been able to reduce
some of the specific loss reserves previously assigned to problem
loans. We believe the allowance for loan losses is adequate to cover
potential losses inherent in our loan portfolio."
Noninterest income totaled $985,000 for the quarter ending March
31, 2004 representing a decrease of $193,000, or 16.4% when compared
to the prior year quarter. The Company experienced a decline in its
residential mortgage lending activity during the first quarter of 2004
when compared to 2003. During the first quarter of 2004, the gain on
the sale of loans decreased $162,000, or 52.9% as compared to the same
period in 2003. In addition, included in noninterest income at March
31, 2004 is the gain on the sale of investment securities of $65,000,
which is a decrease of $23,000 when compared to the same period of
2003.
The Company experienced an increase in noninterest expense
totaling $222,000, or 7.2% for the first quarter of 2004 compared to
2003. The leading factors contributing to the increase in noninterest
expense were reflected in increases of $145,000, or 8.7% in salaries
and employee benefits combined with expenses totaling $67,000
associated with actions initiated by three dissident directors. The
actions initiated by the dissidents represent 30.2% of the total
increase in noninterest expense during 2004. The opening of the new
branch in Sacramento in late 2003 accounted for over 90% of the
increase in salaries and employee benefits expense.
In April 2002, the Board of Directors authorized a stock
repurchase program approving the repurchase of up to $2 million of the
Company's stock. As of March 31, 2004 the Company had acquired a total
of 41,865 shares at a cost of approximately $547,000 pursuant to the
stock repurchase program. The repurchase program has been extended to
December 31, 2004.
The Company anticipates filing its 2003 Form 10-K with the
Securities and Exchange Commission on April 14, 2004. The Company
requested an extension of time to file the 10-K while it evaluated the
allegations of a recently filed lawsuit. As of April 13, 2004, none of
the officers or directors named in the lawsuit have been served with
the complaint. Management intends to contest the allegations of the
lawsuit.
First Financial Bancorp is the parent of Bank of Lodi, N.A., a
locally owned community bank formed in 1982. Bank of Lodi, N.A. offers
financial services via the web at www.bankoflodi.com, by phone at
888-265-8577, at any one of its nine branches located in the
communities of Lodi, Woodbridge, Lockeford, Galt, Plymouth, San
Andreas, Elk Grove, Folsom and Sacramento or its loan production
office located in Folsom, Calif.
This press release contains forward-looking statements within the
meaning of "safe harbor" provisions of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and as such, may involve
risks and uncertainties. Forward-looking statements, which are based
on certain assumptions and describe future plans, strategies, and
expectations, are generally identifiable by the use of words such as
"believe," "expect," "intend," "anticipate," "estimate," "project," or
similar expressions. These forward-looking statements relate to, among
other things, expectations of the business environment in which the
Company operates, projections of future performance, potential future
performance, potential future credit experience, perceived
opportunities in the market, and statements regarding the Company's
mission and vision. The Company's actual results, performance, and
achievements may differ materially from the results, performance, and
achievements expressed or implied in such forward-looking statements
due to a wide range of factors which are set forth in our annual
report on Form 10-K on file with the SEC.
(Tables to Follow)
FIRST FINANCIAL BANCORP AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended
March 31,
-----------------------
2004 2003
----------- -----------
Total interest income $ 3,923 3,276
Total interest expense 743 647
----------- -----------
Net interest income 3,180 2,629
Provision for loan losses 70 257
Noninterest income 985 1,178
Noninterest expense 3,306 3,084
Provision for income taxes 222 124
----------- -----------
Net income $ 567 342
=========== ===========
Basic earnings per share:
Net income available for common stock
shareholders $ 0.32 0.19
Weighted average shares 1,783,538 1,785,693
Diluted earnings per share:
Net income available for common stock
shareholders $ 0.30 0.18
Weighted average shares 1,908,281 1,865,639
Selected ratios:
Annualized return on average total equity 11.10% 7.05%
Annualized return on average total assets 0.71% 0.53%
Note: Total shares and per share data have been retroactively adjusted
for all periods to reflect a 10% stock dividend declared
March 25, 2004
Selected Balance Sheet Data
(in thousands)
(Unaudited)
--------------------------------
March 31, Dec. 31, March 31,
2004 2003 2003
---------- ---------- ----------
Total assets $ 327,475 321,813 259,522
Securities, available for sale 81,682 90,270 28,680
Total loans, gross 206,453 182,565 170,061
Allowance for loan losses 3,314 3,262 3,278
Total deposits 278,632 278,155 226,238
Borrowings 23,265 19,255 10,000
Total shareholders equity 20,962 19,967 19,552
Nonperforming loans 3,112 3,880 2,709
CONTACT: First Financial Bancorp
Leon Zimmerman, 209-367-2000