Exhibit 99.1
Foothill Independent Bancorp Posts Record Profits in First Quarter 2005,
18% Net Income Growth
GLENDORA, Calif.--(BUSINESS WIRE)--April 18, 2005--Foothill
Independent Bancorp (Nasdaq:FOOT), the holding company for Foothill
Independent Bank, today reported that strong loan growth funded
primarily by core deposits contributed to an 18% profit increase over
the first quarter of 2004.
Net income was $2.6 million, or $0.36 per diluted share, in the
quarter ended March 31, 2005, compared to $2.2 million, or $0.31 per
share in the first quarter a year ago. Performance measures advanced,
reflecting Foothill's improvements in profitability over the last
year. The annualized return on average equity (ROE) improved to 16.1%
in the first quarter of 2005, compared to 14.3% in the same quarter
last year, while the annualized return on average assets (ROA) grew to
1.30%, versus to 1.26% in the first quarter of 2004.
"We have generated excellent performance ratios by keeping a low
cost of funds and growing our high-performing loan portfolio," stated
George Langley, President and CEO. "Should interest rates continue to
rise, I expect our profitability will improve further as a significant
portion of our loan portfolio is prime-based with yields that adjust
quicker, and to a greater degree, than the costs on our deposit base."
Assets increased 11% to $805 million at March 31, 2005, compared
to $729 million a year earlier, with total loans also growing 11% to
$517 million, from $466 million at the end of the first quarter last
year. Total securities were $199 million at the end of the first
quarter of 2005, up 34% from $148 million a year prior.
Total deposits increased 10% to $717 million at the end of the
first quarter of 2005, compared to $653 million in the like quarter of
2004. Core deposits, defined as low- and no-cost deposits, increased
12% to $649 million, representing 91% of total deposits at
quarter-end, compared to $582 million, or 89% of deposits at the end
of the first quarter last year. Time deposits decreased by 5% to $67
million, from $71 million at the end of the first quarter a year ago.
Net interest margin was 4.87% in the first quarter of 2005, which was
lower than the 4.93% in the first quarter last year, but was an
improvement over 4.74% in the fourth quarter of 2004, indicating that
net interest margin is beginning to trend upward.
"Core deposit growth continues to outpace loan generation, so our
available-for-sale securities portfolio has shown a sizable increase
over the last year," Langley said. "We will continue working to obtain
quality loans to more effectively deploy that capital, which should
help further expand our net interest margin going forward. In the
meantime, our conservative underwriting standards have helped ensure
that Foothill remains an exceedingly strong institution."
Credit quality remains excellent, with non-performing loans (NPLs)
declining to $124,000, or 0.02% of total loans at March 31, 2005. A
year ago, NPLs were $138,000 or 0.03% of assets. The Bank recorded a
net loan charge-off of $1,000 during the first quarter of 2005,
compared to a net recovery of $7,000 during the first quarter last
year. The reserve for loan losses was $5.0 million at March 31, 2005,
representing 0.97% of gross loans and far exceeding NPAs.
Net interest income increased 14% to $9.0 million in the first
quarter of 2005, compared to $7.9 million in the first quarter last
year. Interest income increased by $1.2 million due primarily to the
larger earning asset base, while interest expense increased by only
$163,000 despite the rising interest rate environment, due to a
continued focus on building low-cost deposits.
Other operating income decreased slightly to $1.3 million in the
quarter, compared to $1.4 million in the first quarter of 2004.
Non-interest expenses increased 7% to $6.2 million, from $5.8 million
in the first quarter last year.
"The up tick in operating expenses is essentially due to increased
employee benefits, including funding our annual performance incentive
program," Langley said. "Despite the increase, our efficiency ratio
improved to 61.9% for the first quarter of 2005, from 64.8% in the
same quarter last year, reflecting our commitment to keeping operating
expenses in check."
Shareholders' equity grew to $65 million at March 31, 2005,
compared to $62 million a year earlier. Book value increased to $9.60
per share at the end of the first quarter this year, from $9.29 per
share at March 31, 2004. Capital ratios continue to be above the
"Well-Capitalized" guidelines established by the regulatory agencies.
The Tier 1 Leverage Ratio was 9.30% and the Total Risk-based Capital
Ratio was 13.48% at March 31, 2005.
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 the Securities Acts of 1933 and 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," or words of similar
meaning, or future or conditional verbs such as "will," "would,"
"should," "could," or "may." Forward-looking statements set forth our
expectations or beliefs regarding our future financial condition or
future financial performance, which are based on current information.
Our actual results in future periods could differ significantly from
our current estimates, expectations and beliefs, as set forth in this
Release, due to a number of risks and uncertainties that could affect
our business or operating results. Those risks and uncertainties
include, but are not limited to:
-- The risk of increased competition from other institutions,
which could require us to reduce the interest rates we can
charge on loans or to increase the interest we must pay to
attract or maintain deposits, either or both of which could
lead to reductions in our net interest margin or net earnings.
-- The risk of adverse changes in national economic conditions or
changes in Federal Reserve Board monetary policies, which
could lead to reductions in loan demand or a weakening in the
financial ability of borrowers to meet their loan obligations
to us.
-- The risk of a significant decline in real property values in
Southern California which, because approximately 90% of our
loans are secured by real property, could result in a
deterioration in the performance of our loan portfolio and, as
a result, could require us to increase the provisions we must
make for potential loan losses and lead to increase in loan
write-offs, which would reduce our earnings and could
adversely affect our financial condition.
-- The risk that natural disasters, such as earthquakes or fires,
which are not uncommon in Southern California, or localized
economic downturns could adversely affect our operating
results.
-- The risk of changes in federal and state bank regulatory
policies that might have the effect of reducing yields on
earning assets or increasing our operating costs.
-- The risk that growth initiatives, such as the addition of new
branches or possible acquisitions of other banks, would result
in increased operating costs and declines in our earnings, and
-- The risk that we may have to reduce or eliminate cash
dividends due to the occurrence of any of the foregoing
events.
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, 2004, 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)
(Dollars in thousands, except per share data)
March 31, Percentage
2005 2004 Change
--------- --------- --------
ASSETS:
Noninterest earning demand deposits and
cash on hand $34,662 $43,807
Federal funds sold and overnight
repurchase agreements 20,900 44,100
Interest-earning deposits 6,833 6,832
--------- ---------
Total Cash and Cash Equivalents 62,395 94,739 -34%
Securities available for sale 191,167 140,464
Securities held to maturity 7,893 7,899
--------- ---------
Total Securities 199,060 148,363 34%
Loans and leases receivable 517,342 466,133 11%
Reserve For loan losses (5,015) (4,954)
--------- ---------
Loans & Leases Receivable, Net 512,327 461,179 11%
Accrued interest receivable 3,555 2,704
Other real estate owned - -
Premises and equipment 4,791 4,944
Federal Home Loan Bank (FHLB) stock, at
cost 3,460 377
Federal Reserve Bank (FRB) stock, at
cost 348 351
Other assets 19,461 16,198
--------- ---------
TOTAL ASSETS $805,397 $728,855 11%
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY:
LIABILITIES:
Non-interest bearing demand deposits $275,795 $240,105
Savings & NOW deposits 172,700 162,754
Money market deposits 200,947 178,807
Time deposits 67,354 71,190
--------- ---------
Total Deposits 716,796 652,856 10%
Accrued employee benefits 3,474 3,132
Accrued interest and other liabilities 2,052 2,124
Other debt 18,248 8,248
--------- ---------
Total Liabilities 740,570 666,360 11%
STOCKHOLDERS' EQUITY:
Common stock $0.001 par value-
authorized: 25,000,000 shares;
issued and outstanding: 6,752,548 and
6,729,477 shares, respectively 7 7
Additional paid-in capital 68,021 67,413
Retained earnings (873) (5,419)
Accumulated other comprehensive income
net of taxes (2328) 494
--------- ---------
Total Stockholders' Equity 64,827 62,495 4%
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $805,397 $728,855 11%
========= =========
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
(Dollars in thousands, except per share amounts)
Three Months Ended
March 31, Percent
2005 2004 Change
---------- ---------- ------------
INTEREST INCOME
Interest on loans & leases $8,268 $7,646
Interest on securities 1,647 1,127
Interest on federal funds sold 172 82
Interest other 47 24
---------- ----------
Total Interest Income 10,134 8,879 14%
INTEREST EXPENSE
Deposits 1,059 924
Interest on borrowings 120 92
---------- ----------
Total Interest Expense 1,179 1,016 16%
Net interest Income 8,955 7,863 14%
Provision for loan losses - -
---------- ----------
Net interest income after loan loss
provision 8,955 7,863 14%
OTHER OPERATING INCOME
Fees on deposits 1,038 1,267
Gain on sales of SBA loans 13 2
Other 231 149
---------- ----------
Total Other Operating Income 1,282 1,418 -10%
OPERATING EXPENSES
Salaries and employee benefits 2,943 2,778
Occupancy and equipment 1,043 1,115
Other 2,248 1,950
---------- ----------
Total Other Operating Expenses 6,234 5,843 7%
---------- ----------
Income before taxes 4,003 3,438
Income tax 1,392 1,234
---------- ----------
NET INCOME $2,611 $2,204 18%
========== ==========
Per Share Data
Earnings per common share -
Basic $0.39 $0.33 18%
========== ==========
Weighted average shares
outstanding - Basic 6,741,310 6,717,428
========== ==========
Earnings per common share -
Diluted $0.36 $0.31 18%
========== ==========
Weighted average shares
outstanding - Diluted 7,192,030 7,159,490
========== ==========
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
CONSOLIDATED FINANCIAL RATIOS (unaudited)
Three Months Ended
March 31,
---------------------
2005 2004
---------- ----------
Return on average assets(a) 1.30% 1.26%
Return on average equity(a) 16.15% 14.32%
Efficiency ratio(a) 61.88% 64.78%
Annualized operating expense/average assets(a) 3.11% 3.33%
Net interest margin 4.87% 4.93%
Tier 1 capital ratio(a) 9.30% 9.92%
Risk adjusted capital ratio(a) 13.48% 14.11%
- ------
(a) These ratios have been annualized.
OTHER CONSOLIDATED FINANCIAL DATA (unaudited)
Three Months Ended
March 31,
---------------------
2005 2004
---------- ----------
(Dollars in
thousands, except
per share amounts)
Net loans and leases $512,327 $461,179
Non-performing/non-accrual loans(a)
Amounts $124 $138
As a percentage of gross loans 0.02% 0.03%
Real estate owned - loans $ - $ -
Total non-performing assets
Amounts $124 $138
As a percentage of total assets 0.02% 0.02%
Loan loss reserves
Amounts $5,015 $4,954
As a percentage of gross loans 0.97% 1.06%
Loan loss provision $ - $ -
Net charge-offs (recoveries) $1 $(7)
- ------
(a) Non-Accrual loans are loans that have made no payments of
principal or interest for more than 90 days.
At March 31, 2005 At March 31, 2004
------------------- -------------------
Book Value Per Share $9.60 $9.29
FOOTHILL INDEPENDENT BANCORP AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEET
(unaudited)
(Dollars in thousands)
Three Months Ended
March 31,
2005 2004
--------- ---------
ASSETS
Earning assets:
Interest-earning deposits $8,599 $6,588
Federal funds sold and overnight repurchase
agreements 28,492 34,724
Investment securities 198,511 139,920
Loans and leases (net of unearned income) 509,558 463,376
--------- ---------
Total earning assets 745,160 644,608
Loan loss reserve (5,018) (4,943)
Non-earning assets 62,598 62,574
--------- ---------
TOTAL ASSETS $802,740 $702,239
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits:
Savings and interest bearing transaction
accounts $376,483 $325,423
Certificates of deposit, $100,000 or more 40,318 30,357
Other time deposits 34,597 43,494
--------- ---------
Total interest-bearing deposits 451,398 399,274
Other interest-bearing liabilities 8,470 8,248
--------- ---------
Total interest bearing liabilities 459,868 407,522
Non-interest liabilities:
Demand deposits 272,412 229,968
Other non-interest liabilities 5,791 3,205
--------- ---------
Total liabilities 738,071 640,695
Stockholders' equity 64,669 61,544
--------- ---------
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY $802,740 $702,239
========= =========
CONTACT: Foothill Independent Bancorp
G. Langley, 626-963-8551