Exhibit 99.1
Foothill Independent Bancorp Reports Record Profits in 2004;
As Net Income Increases 11%, Operating Expenses Remain Flat,
Core Deposit Growth Continues
GLENDORA, Calif.--(BUSINESS WIRE)--Jan. 25, 2005--Foothill
Independent Bancorp (NASDAQ:FOOT), the holding company for Foothill
Independent Bank, today reported that continued growth in core
deposits and a focus on minimizing operating expenses resulted in
record profits in the fourth quarter and year ended December 31, 2004.
Fourth quarter net income increased 15% to $2.55 million, or $0.36 per
diluted share, from $2.22 million, or $0.31 per diluted share in the
fourth quarter of 2003. For the full year, net income grew 11% to
$9.36 million, or $1.31 per diluted share, compared to $8.42 million
or $1.18 per diluted share in 2003.
"We have always emphasized building shareholder value, and in 2004
that was particularly evident," stated George Langley, President and
CEO. "We started off the year issuing a 9% stock dividend and then
raised our quarterly cash dividend to $0.13 per share. In November, we
paid a $0.20 per share special cash dividend for the second year in a
row. Just as importantly, we have focused on profits, as well. Net
income increased 11% for the year and 15% in the last quarter, and I
expect that we will carry that momentum into the new year."
Annualized return on average equity (ROE) improved to 16.1% in the
fourth quarter of 2004, from 15.0% in the same quarter last year. For
the year ended December 31, 2004, ROE improved to 15.1% from 14.4% in
2003. Annualized return on average assets remained flat from a year
ago at 1.28% for the fourth quarter, and was 1.25% for the year ended
December 31, 2004, compared to 1.29% for 2003.
"Our success has stemmed, in part, from a continued focus on
building core deposits to fund our new loans," Langley said. "In the
fourth quarter, a slowdown in the number of loan payoffs and strong
loan generation further increased our profitability."
Core deposits, consisting of no-cost demand deposits and low-cost
savings and money market deposits, increased 17% to $631.2 million at
December 31, 2004, compared to $537.4 million at December 31, 2003. In
the same 12-month period, time deposits increased by just 4%, to $77.9
million from $74.6 million a year ago. Total deposits were up 16% to
$709.1 million at December 31, 2004, from $612.0 million a year
earlier. At December 31, 2004, core deposits represented 89% of total
deposits, compared to 88% of deposits at the end of 2003.
Total assets increased 15% to $787.0 million at December 31, 2004,
compared to $686.2 million at December 31, 2003. Net loans increased
10% to $500.6 million at December 31, 2004, from $455.1 million at
December 31, 2003, with more than half of that growth occurring in the
fourth quarter of 2004.
"With a significant portion of our portfolio in variable-rate
loans and a relatively low cost of funds, we are positioned to expand
our net interest margin should rates continue to rise at a reasonable
pace," Langley said. Net interest margin was 4.74% in the fourth
quarter and 4.80% for the year ended December 31, 2004, compared to
5.21% in the fourth quarter, and 5.27% for the year ended December 31,
2003. The securities portfolio increased 34% to $194.6 million, versus
$145.6 million at the end of 2003.
Credit quality remains exceptionally strong:
-- Non-performing assets (NPAs) declined to $137,000, or 0.02% of
total assets at December 31, 2004, compared to $626,000, or
0.09% of assets a year ago.
-- The reserve for loan losses grew to $5.0 million at the end of
2004, far exceeding NPAs.
-- Foothill recorded a net recovery of $69,000 for 2004, compared
to a net charge-off of $16,000 for 2003.
Net interest income was $8.7 million in the fourth quarter of
2004, compared to $8.2 million in the final quarter of 2003, driven by
an increase in average earning assets. Net interest income was $32.5
million for the full year of 2004, compared to $31.0 million for 2003.
In the fourth quarter of fiscal 2004, other operating income
declined to $1.3 million from $1.4 million in the same quarter of
2003, and declined by less than 1% in the fiscal year ended December
31, 2004, as compared to 2003, primarily as a result of a decline in
fee income on deposit accounts.
Other operating expenses decreased slightly to $6.0 million for
the fourth quarter and were substantially unchanged at $23.5 million
for the full year ended December 31, 2004. "Our efforts to minimize
operating expenses resulted in improvements in our efficiency ratios
and contributed to our record profits," Langley said. The efficiency
ratio was 60.8% in the fourth quarter of 2004 compared to 63.0% for
the same period of 2003 and was 63.0% for the full year 2004 compared
to 63.9% in 2003. "We will continue our efforts to trim overhead in
2005," Langley said.
At December 31, 2004, shareholders' equity was $64.6 million,
compared to $60.8 million a year earlier and book value increased to
$9.59 per share from $9.07 per share at December 31, 2003. Capital
ratios continue to be above the "Well-Capitalized" guidelines
established by U.S. Bank Regulatory Agencies. The Tier 1 Leverage
Ratio was 9.10% and the Total Risk-based Capital Ratio was 13.40% at
December 31, 2004.
About Foothill Independent Bancorp
Foothill Independent Bancorp is a one-bank holding company that
owns and operates Foothill Independent Bank. The Bank currently
operates 12 commercial banking offices in Los Angeles, San Bernardino
and Riverside Counties. Foothill Independent Bank has consistently
earned the highest ratings for safety and soundness from such bank
rating firms as Findley Reports, Bauer Financial Services, and
Veribanc.
Forward Looking Information
This Release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements can be identified by the fact that they do
not relate strictly to historical or current facts and often include
the words "believe," "expect," "anticipate," "project," or words of
similar meaning, or future or conditional verbs such as "will,"
"would," "should," "could," or "may." Forward-looking statements
contain estimates of, or set forth our expectations or beliefs
regarding, our future financial condition or future financial
performance that are based on current information. Our future
financial condition or operating results could differ significantly
from our current estimates, expectations and beliefs, as set forth in
this Release, due to a number of risks and uncertainties, which
include risks and uncertainties such as, but not limited to, the
following: the risk that competition from other financial and
depository institutions will increase, forcing us to reduce the
interest rates we can charge to attract and retain loans or to
increase the interest we must pay to attract or maintain deposits,
either or both of which could result in reductions in our interest
income or increases in our interest expense that would lead to
reductions in our net interest margin, net interest income or net
earnings; adverse changes in national or local economic conditions or
changes in Federal Reserve Board monetary policies, that could lead to
reductions in loan demand, a weakening in the financial ability of
borrowers to meet their loan obligations to us or declines in the
values of real properties that secure those loan obligations, which
could result in reductions in our net interest margin, net interest
income and net income; changes in regulatory requirements and new
growth initiatives, including possible acquisitions of other banks or
the initiation of new service offerings, that could lead to increases
in our operating expenses and, therefore, to reductions in our
profitability; and the possibility that we might have to reduce cash
dividends due to factors outside of our control, such as adverse
changes in economic and market conditions or in our financial
performance or financial condition and due to needs for capital to
support future growth. Certain of those risks and uncertainties, as
well as others, are described more fully in our Annual Report on Form
10-K for the fiscal year ended December 31, 2003, as filed with the
Securities and Exchange Commission. Readers of this Release are urged
to read the cautionary statements, which are set forth under the
caption "Management's Discussion and Analysis of Financial Condition
and Results of Operations -- Factors That Could Affect Our Future
Financial Performance" in Part II of that Report. Due to these
uncertainties and risks, readers are cautioned not to place undue
reliance on forward-looking statements contained in this Release,
which speak only as of this date. We undertake no obligation to update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
December 31, Percentage
------------------ Change
2004 2003
--------- --------- ----------
(Dollars in Thousands)
ASSETS:
Noninterest earning demand deposits and
cash on hand $23,611 $34,565
Federal funds sold and overnight
repurchase agreements 28,900 18,500
Interest-earning deposits 9,803 7,425
--------- ---------
Total Cash and Cash Equivalents 62,314 60,490 3%
Securities available for sale 186,575 136,650
Securities held to maturity 7,980 8,900
--------- ---------
Total Securities 194,555 145,550 34%
Loans and leases receivable 505,623 460,048 10%
Reserve for loan losses (5,016) (4,947)
--------- ---------
Loans & Leases Receivable, Net 500,607 455,101 10%
Accrued interest receivable 3,006 2,824
Other real estate owned - -
Premises and equipment 4,815 5,061
Federal Home Loan Bank (FHLB) stock, at
cost 3,460 374
Federal Reserve Bank (FRB) stock, at
cost 348 351
Other assets 17,850 16,407
--------- ---------
TOTAL ASSETS $786,955 $686,158 15%
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Non-interest bearing demand deposits $259,285 $225,863
Savings & NOW deposits 164,947 155,868
Money market deposits 206,919 155,717
Time deposits 77,899 74,601
--------- ---------
Total Deposits 709,050 612,049 16%
Accrued employee benefits 3,446 3,154
Accrued interest and other liabilities 1,642 1,919
Other debt 8,248 8,248
--------- ---------
Total Liabilities 722,386 625,370 16%
Stockholders' Equity:
Common stock $0.001 par value-
authorized: 25,000,000 shares;
Issued and outstanding: 6,731,631 and
6,702,912 shares, respectively 7 6
Additional paid-in capital 67,831 67,222
Retained earnings (2,608) (6,605)
Accumulated other comprehensive income
net of taxes (661) 165
--------- ---------
Total Stockholders' Equity 64,569 60,788 6%
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $786,955 $686,158 15%
========= =========
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Dollars in Thousands, Except Per Share Amount
(Unaudited)
(unaudited)
(dollars in
thousands, Three Months Ended Percent Year Ended Percent
except per December 31 Change December 31 Change
share data) 2004 2003 2004 2003
------------------------------------------------------
INTEREST INCOME
Interest on
loans & leases $8,031 $7,886 $31,016 $31,683
Interest on
securities 1,461 1,197 5,225 3,515
Interest on
federal funds
sold 346 88 653 360
Interest other 46 27 136 122
-------------------- --------------------
Total Interest
Income 9,884 9,198 7% 37,030 35,680 4%
INTEREST EXPENSE
Deposits 1,124 905 4,073 3,910
Interest on
borrowings 108 93 394 373
-------------------- --------------------
Total Interest
Expense 1,232 998 23% 4,467 4,283 4%
Net interest
Income 8,652 8,200 6% 32,563 31,397 4%
Provision for
loan losses - 48 -100% 78 348 -78%
-------------------- --------------------
Net interest
income after
loan loss
provision 8,652 8,152 6% 32,485 31,049 5%
OTHER OPERATING
INCOME
Fees on deposits 1,178 1,269 4,999 5,000
Gain on sales of
SBA loans - 2 5 5
Other 128 144 581 608
-------------------- --------------------
Total Other
Operating
Income 1,306 1,415 -8% 5,585 5,613 0%
OPERATING EXPENSES
Salaries and
employee
benefits 3,043 3,003 11,697 11,822
Occupancy and
equipment 1,102 988 4,296 4,033
Other 1,881 2,112 7,539 7,660
-------------------- --------------------
Total Other
Operating
Expenses 6,026 6,103 -1% 23,532 23,515 0%
-------------------- --------------------
Income before
taxes 3,932 3,464 14,538 13,147
Income tax 1,382 1,244 5,183 4,726
-------------------- --------------------
NET INCOME $2,550 $2,220 15% $9,355 $8,421 11%
==================== ====================
Per Share Data(a)
Earnings per
common share -
Basic $0.38 $0.33 6% $1.39 $1.27 7%
==================== ====================
Weighted average
shares
outstanding -
Basic 6,727,382 6,695,793 6,721,826 6,613,062
==================== ====================
Earnings per
common share -
Diluted $0.36 $0.31 6% $1.31 $1.18 9%
==================== ====================
Weighted average
shares
outstanding -
Diluted 7,169,197 7,140,294 7,158,586 7,140,144
==================== ====================
(a)Per share data for the quarter ended December 31, 2003 has been
retroactively adjusted for stock dividends paid subsequent to December
31, 2003.
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
CONSOLIDATED FINANCIAL RATIOS
(Unaudited)
Three Months Twelve Months
Ended(1) Ended(1)
December 31, December 31,
-------------- --------------
2004 2003 2004 2003
-------------- --------------
Return on average assets 1.28% 1.28%(a) 1.25% 1.29%
Return on average equity 16.09% 14.98%(a) 15.05% 14.38%
Efficiency ratio 60.83% 63.88% 63.01% 63.93%
Operating expense/average assets 3.03% 3.53%(a) 3.15% 3.61%
Net interest margin 4.74% 5.21%(a) 4.80% 5.27%
Tier 1 capital ratio 9.10% 9.80% 9.10% 9.80%
Risk adjusted capital ratio 13.40% 14.07% 13.40% 14.07%
(1) All ratios have been annualized
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
OTHER CONSOLIDATED FINANCIAL DATA
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
(Dollars in thousands)
---------------------------------------
Net loans and leases $500,607 $455,101 $500,607 $455,101
Non-performing/non-accrual
loans (1)
Amounts $137 $626 $137 $626
As a percentage of gross
loans 0.03% 0.14% 0.03% 0.14%
Real estate owned - loans $- $- $- $-
Total non-performing assets
Amounts $137 $626 $137 $626
As a percentage of total
assets 0.02% 0.09% 0.02% 0.09%
Loan loss reserves
Amounts $5,016 $4,947 $5,016 $4,947
As a percentage of gross
loans 0.99% 1.08% 0.99% 1.08%
Loan loss provision $- $48 $78 $348
Net charge-offs (recoveries) $(35) $(25) $(69) $16
(1) Non-Accrual loans are loans that have made no payments of
principal or interest for more than 90 days.
At At
December December
31, 2004 31, 2003
---------- ----------
Book Value Per Share (1) $9.59 $9.07
(1) Adjusted for stock dividends issued subsequent to December 31,
2003.
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
AVERAGE BALANCES
Dollars in Thousands
(Unaudited)
Three Months Ended Twelve Months Ended
December 31 December 31
2004 2003 2004 2003
--------- --------- --------- ---------
ASSETS (In Thousands)
Earning
assets:
Interest-earning deposits $9,118 $8,324 $7,934 $8,320
Federal funds sold and
overnight repurchase
agreements 73,082 22,196 46,176 34,370
Investment securities 176,118 160,516 160,463 110,113
Loans and leases (net of
unearned income) 480,717 444,910 472,664 449,654
--------- --------- --------- ---------
Total earning assets 739,035 635,946 687,237 602,457
Loan loss reserve (4,985) (4,884) (4,975) (4,711)
Non-earning assets 62,579 60,108 64,071 56,256
--------- --------- --------- ---------
Total Assets $796,629 $691,170 $746,333 $654,002
========= ========= ========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits:
Savings and interest
bearing transaction
accounts $382,204 $312,464 $351,308 $288,756
Certificates of deposit,
$100,000 or more 33,236 31,606 30,400 32,254
Other time deposits 37,220 45,218 40,401 48,358
--------- --------- --------- ---------
Total interest-bearing
deposits 452,660 389,288 422,109 369,368
Other interest-bearing
liabilities 8,248 8,248 8,248 8,248
--------- --------- --------- ---------
Total interest bearing
liabilities 460,908 397,536 430,357 377,616
Non-interest bearing
liabilities:
Demand deposits 266,165 228,414 248,386 212,963
Other non-interest bearing
liabilities 6,153 5,951 5,421 4,843
--------- --------- --------- ---------
Total liabilities 733,226 631,901 684,164 595,422
Stockholders' equity 63,403 59,269 62,169 58,580
--------- --------- --------- ---------
Total Liabilities and
Stockholders' Equity $796,629 $691,170 $746,333 $654,002
========= ========= ========= =========
CONTACT: Foothill Independent Bancorp
George Langley, 626-963-8551