Exhibit 99.1
Union Financial Bancshares, Inc. Announces First Quarter Earnings
UNION, S.C.--(BUSINESS WIRE)--April 20, 2004--Union Financial
Bancshares, Inc. (NASDAQ: UFBS) announced earnings of $509,000 for the
quarter ended March 31, 2004 compared to earnings of $497,000 for the
first quarter of 2003, a 2.41% increase. Earnings per share were $.25
per share (dilutive) for the first quarter of 2004, versus $.24 per
share (dilutive) for the first quarter of 2003.
Net interest income before the loan loss provision for the current
quarter increased $132,000, or 6.20%, to $2,260,000 compared to
$2,128,000 for the same period in the previous year. The increase was
due primarily to higher average balances of investment securities over
the previous year along with an increase in yield on investments.
Provision for loan losses for the current quarter totaled $135,000
compared to $235,000 for the same period in the previous year. The
decrease in provision for loan losses from the previous year quarter
was primarily due to a reduction in non performing loans from the
previous year. Non interest income for the current quarter decreased
$13,000, or 2.33%, to $546,000 compared to $559,000 for the same
period in the previous year. The decrease was due to the previous year
including $182,000 from the gain on sale of securities compared to $0
for the current year. In addition, bank and loan fees increased
$134,000, or 35.54%, to $511,000 compared to $377,000 for the same
period in the previous year as a result of the development of new fee
income programs that were recently implemented. Non interest expense
for the current quarter increased $209,000 or 11.68% to $1,999,000
compared to $1,791,000 for the same period in the previous year. The
increase over the previous year was due to additional operating
expenses for the new Rock Hill office that was opened in July, 2003.
At March 31, 2004, assets totaled $359.9 million, an 8.83%
increase from $330.6 million at December 31, 2003. Net loans
receivable increased $1,900,000, or 1.24%, during the period to $155.2
million at March 31, 2004, compared to $153.3 million at December 31,
2003. Investment and mortgage-backed securities at March 31, 2004,
increased 39.60% to $172.8 million from $123.8 million at December 31,
2003. The increase in securities was funded with cash on hand and an
increase in borrowings of $22.7 million. Deposits at March 31, 2002,
increased 1.82% to $227.2 million from $223.1 million at December 31,
2003.
Commenting on the first quarter results, Dwight V. Neese,
President and Chief Executive Officer, stated: "We are pleased with
the results we have been able to achieve in the face of challenging
local economic conditions and in the midst of repositioning the
balance sheet after our charter conversion in the previous year. We
continued to have positive growth on the balance sheet, marked by an
increase in the consumer and commercial loan portfolios of 32.15% over
the same period last year. We are continuing to focus on core earnings
and building long-term value for our shareholders."
The Company announced the declaration of a quarterly dividend of
$0.10 per share on its outstanding common stock, payable May 17, 2004
to shareholders of record on April 30, 2004.
Union Financial Bancshares is the holding company for Provident
Community Bank, which operates seven banking locations in the upstate
of South Carolina. At March 31, 2004, Union Financial had $359.9
million in total assets and total stockholders' equity of $26.3
million.
Union Financial Bancshares, Inc.
First Quarter - Year Ending December 31, 2004
Financial Highlights
(Unaudited) ($ in thousands, except share data)
Quarter Year
Ended Ended $ %
Balance Sheet 3/31/04 12/31/03 Change Change
- ------------- --------- -------- ------- -------
Total assets $359,868 $330,665 $29,203 8.83%
Cash and interest-bearing
deposits 6,851 28,702 (21,851) -76.13%
Investments & mortgage-backed
securities 172,804 123,789 49,015 39.60%
Loans receivable (net) 155,201 153,301 1,900 1.24%
Goodwill and intangible assets 4,689 4,848 (159) -3.28%
Deposits 227,191 223,131 4,060 1.82%
Advances and other borrowings 96,225 73,500 22,725 30.92%
Trust preferred corporate
obligations 8,000 8,000 0 0.00%
Stockholders' equity 26,333 25,508 825 3.23%
Outstanding shares 1,960,889 1,966,204 (5,315) -0.27%
Book value per share $13.43 $12.97 $0.46 3.51%
Tangible book value per share $11.04 $10.51 $0.53 5.05%
Three Months Ended
March 31,
-----------------------------------
$ %
Income Statement 2004 2003 Change Change
------ ------ ------ ------
Net interest income $2,260 $2,128 $132 6.20%
Provision for loan losses 135 235 (100) -42.55%
------ ------ ------ ------
Net interest income after loan
provision 2,125 1,893 232 12.26%
Noninterest income 546 559 (13) -2.33%
Noninterest expense 1,999 1,791 208 11.61%
Income tax 163 164 (1) -0.61%
------ ------ ------ ------
Net income $509 $497 $12 2.41%
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Earnings per share: basic $0.26 $0.25 $0.01 4.00%
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Earnings per share: diluted $0.25 $0.24 $0.01 4.17%
====== ====== ====== ======
Three Months Ended
March 31,
-------------------
Key Financial Ratios 2004 2003
------- ------
Return on average assets 0.59% 0.59%
Return on average stockholder
equity 7.88% 7.14%
Operating expense to average
assets 2.32% 2.12%
Capital to average assets 9.94% 10.63%
CONTACT: Union Financial Bancshares, Inc.
Dwight V. Neese, 864-429-1863