Exhibit 99
Temecula Valley Bancorp Inc. Announces Record Earnings
TEMECULA, Calif.--(BUSINESS WIRE)--July 20, 2005--Temecula Valley
Bancorp Inc. (OTCBB:TMCV) has announced that Net income for the
quarter ending June 30, 2005 was $3,943,041, a 49% increase from the
$2,646,626 earned in the same period last year. Net income for the six
months ending June 30, 2005, was $6,944,721 compared to $5,218,775 for
the same period last year, a $1,725,946 or 33% increase. "We are
pleased with the results," stated Stephen H. Wacknitz, President/CEO,
"considering that for 2005, principally due to growth, the provision
for loan losses was increased from $750,000 last year to $1,642,900
this year, and Temecula Valley Bank (the "Bank"), the principal
subsidiary of Temecula Valley Bancorp, Inc. (the "Company"), is in the
process of opening full service offices in Indian Wells and Carlsbad,
as well as expanding the SBA loan production office network." The net
interest margin for all of 2004 was 5.96% and has improved to 6.67%
for the first half of 2005 as the Federal Reserve Bank has continued
to increase the fed funds rate.
Total assets increased 37%, from $527,793,743 at June 30, 2004, to
$724,216,457 at June 30, 2005. Loans increased 40%, with construction
loans increasing 84% and real estate secured loans increasing 48%.
Commercial loans showed a decrease of 20% and SBA loans, which include
both real estate secured as well as commercial loans, decreased 8%.
The large increase in construction loans was due to increased tract
housing construction, the addition of the loan production office in
San Rafael, and the general overall robust real estate market in
Southern California.
Federal funds sold increased from $15,600,000 on June 30, 2004, to
$27,420,000 on June 30, 2005. The allowance for loan loss increased
from $4,043,705 at June 30, 2004, to $7,839,179 at June 30, 2005, a
94% increase. The allowance for loan loss as a percent of loans was
0.90% at June 30, 2004, and 1.25% at June 30, 2005.
Net charge-offs were $166,255 for the first six months of 2005,
compared to $314,128 for the same period in 2004. Non-accrual loans
(net of SBA guarantees) were $3,229,889 at June 30, 2005, compared to
$1,283,703 at June 30, 2004. There was no other real estate owned
(OREO), net of SBA guarantees, as of June 30, 2005 compared to
$352,500 at June 30, 2004.
For the twelve-month period from June 30, 2004, to June 30, 2005,
fixed assets increased from $3,006,473 to $4,763,102 due to the
addition of two full service offices and several loan production
offices. The SBA servicing assets increased due to SBA 7A loan sales
in the secondary market.
Deposits increased 42%, from $452,358,807 at June 30, 2004, to
$643,773,990 at June 30, 2005. Continued expansion of business at the
existing and new branches, as well as various CD promotions has fueled
the deposit growth. Deposit growth is expected to be sufficient in the
near future to fund loan growth.
Junior subordinated debt securities increased $8,248,000 due to
the net addition in September 2004 of $8,000,000 of a trust preferred
borrowing that was transferred to the Bank as tier one capital, and is
considered tier one and tier two capital on a consolidated basis.
Included in other liabilities is a $616,000 reserve for undisbursed
loans. The related $129,000 expense for 2005 is reflected in other
expense.
Shareholder equity increased from $36,910,393 at June 30, 2004 to
$50,483,783 at June 30, 2005 due to net income and the exercise of
stock options. The capital ratios remain strong, with the tier one
leverage ratio at 9.54%, the tier one risk based ratio at 9.40% and
the total risk based capital ratio at 11.08%, all easily above the
minimum to qualify as "well capitalized."
The Bank was established in 1996 and operates full service offices
in Temecula, Murrieta, Corona, Fallbrook, Escondido, Rancho Bernardo
and El Cajon. The Company was established in June 2002 and operates
principally as a holding company for the Bank. As a Preferred Lender
(PLP) since 1998, the locally owned and operated Bank also has SBA
loan production offices in California, Colorado, Florida, Georgia,
Illinois, New Jersey, North Carolina, Ohio, and Texas. The Company's
common stock is quoted in the over the counter market and trades under
the symbol TMCV.OB. The Bank's website is at www.temvalbank.com.
Statements concerning future performance, developments or events
concerning expectations for growth and market forecasts, and any other
guidance on future periods, constitute forward-looking statements that
are subject to a number of risks and uncertainties. Actual results may
differ materially from stated expectations. Specific factors include,
but are not limited to, the effect of interest rate changes, the
ability to control costs and expenses, the impact of consolidation in
the banking industry, financial policies of the United States
government, and general economic conditions. Additional information on
these and other factors that could affect financial results are
included in the Company's Securities and Exchange Commission filings
which can be accessed at www.sec.gov.
TEMECULA VALLEY BANCORP INC.
FINANCIAL DATA
JUNE 2005
(UNAUDITED)
(all amounts in whole dollars except
share and per share information)
June 30, June 30, Increase Increase
2005 2004 (Decrease) (Decrease)
------------ ------------ ------------ ----------
ASSETS
Cash and due from
banks 11,013,343 15,935,851 (4,922,508) (31%)
Federal funds sold 27,420,000 15,600,000 11,820,000 76%
Securities - held
to maturity 0 0 0 0%
Loans 628,212,313 448,229,019 179,983,294 40%
Less allowance for
loan losses (7,839,179) (4,043,705) 3,795,474 94%
------------ ------------ ------------
Loans, net 620,373,134 444,185,314 176,187,820 40%
Federal Reserve &
Home Loan Bank
stock, at cost 2,849,000 2,050,300 798,700 39%
Other real estate
owned, net 0 1,410,000 (1,410,000) (100%)
Bank premises and
equipment, net 4,763,102 3,006,473 1,756,629 58%
SBA-loan servicing
I/O strip
receivable 23,479,641 21,689,271 1,790,370 8%
SBA-loan servicing
asset 8,102,773 6,944,100 1,158,673 17%
Cash surrender
value life
insurance 13,469,824 7,661,929 5,807,895 76%
Other Assets 12,745,640 9,310,505 3,435,135 37%
------------ ------------ ------------
724,216,457 527,793,743 196,422,714 37%
============ ============ ============
LIABILITIES AND
STOCKHOLDER EQUITY
Demand deposits 147,656,572 126,475,079 21,181,493 17%
Interest bearing
deposits 496,117,418 325,883,728 170,233,690 52%
------------ ------------ ------------
Total deposits 643,773,990 452,358,807 191,415,183 42%
FHLB advances 0 20,000,000 (20,000,000) (100%)
Junior
subordinated debt
securities 20,620,000 12,372,000 8,248,000 67%
Other liabilities 9,338,684 6,152,543 3,186,141 52%
------------ ------------ ------------
Total
liabilities 673,732,674 490,883,350 182,849,324 37%
Stockholder's
equity 50,483,783 36,910,393 13,573,390 37%
------------ ------------ ------------
724,216,457 527,793,743 196,422,714 37%
============ ============ ============
3 Mos. 3 Mos. 6 Mos. 6 Mos.
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
----------- ---------- ----------- -----------
Interest income 13,454,394 7,790,647 24,864,938 14,607,274
Interest expense 3,179,129 1,375,641 5,557,437 2,618,204
----------- ---------- ----------- -----------
Net interest income 10,275,265 6,415,006 19,307,501 11,989,070
Provision for loan
losses 804,100 250,000 1,642,900 750,000
Other income 7,464,814 6,726,899 13,248,310 13,454,688
Other expense 10,180,120 8,407,711 19,016,812 15,852,319
----------- ---------- ----------- -----------
Earnings before
income taxes 6,755,859 4,484,194 11,896,099 8,841,439
Income taxes 2,812,818 1,837,568 4,951,378 3,622,664
----------- ---------- ----------- -----------
Net earnings 3,943,041 2,646,626 6,944,721 5,218,775
=========== ========== =========== ===========
Actual common shares
outstanding at end
of period 8,865,447 8,608,538 8,865,447 8,608,538
Average common
shares outstanding 8,828,292 8,393,061 8,808,055 8,315,418
Average common
shares &
equivalents
outstanding 9,528,263 9,309,436 9,515,624 9,272,054
Basic earnings per
share 0.45 0.32 0.79 0.63
Diluted earnings per
share 0.41 0.28 0.73 0.56
Return on average
assets
(annualized) 2.28% 2.16% 2.10% 2.23%
Return on average
equity
(annualized) 32.87% 30.60% 30.10% 31.79%
Efficiency ratio 57.38% 63.98% 58.41% 62.30%
6/30/2005 6/30/2004
----------- ----------
Tier 1 leverage
capital ratio 9.54% 9.78%
Tier 1 risk-based
capital ratio 9.40% 9.91%
Total risk-based
capital ratio 11.08% 10.74%
Allowance for loan
losses as a % of
total loans 1.25% 0.90%
Gross nonperforming
assets as a % of
total assets 1.35% 1.46%
Net nonperforming
assets as a % of
total assets 0.45% 0.31%
Net chargeoffs
(annualized) as a %
of total loans 0.05% 0.14%
Loan to deposit
ratio 97.58% 99.09%
Book value per share 5.69 4.29
PAST DUE AND NON-
ACCRUAL LOANS
- ----------------------- -----------------------------------
Gross Government Net Balance
Balance Guaranty
-----------------------------------
June 30, 2005
- -----------------------
30 - 89 days past
due 149,793 0 149,793
=========== =========== ===========
90+ days past due
and accruing 263,218 (244,753) 18,465
Non-accrual 9,474,790 (6,244,901) 3,229,889
Other real estate
owned (REO) 0 0 0
----------- ----------- -----------
Total non-
performing assets 9,738,008 (6,489,654) 3,248,354
=========== =========== ===========
June 30, 2004
- -----------------------
30 - 89 days past
due 247,122 (123,052) 124,070
=========== =========== ===========
90+ days past due
and accruing 0 0 0
Non-accrual 6,290,495 (5,006,792) 1,283,703
Other real estate
owned (REO) 1,410,000 (1,057,500) 352,500
----------- ----------- -----------
Total non-
performing assets 7,700,495 (6,064,292) 1,636,203
=========== =========== ===========
NET LOAN CHARGEOFFS
- -----------------------
3 Mos. 3 Mos. 6 Mos. 6 Mos.
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
----------- ----------- ----------- ----------
Chargeoffs 145,137 70,692 404,825 321,081
Recoveries (133,834) (4,600) (238,570) (6,953)
----------- ----------- ----------- ----------
Net Chargeoffs 11,303 66,092 166,255 314,128
=========== =========== =========== ==========
CONTACT: Temecula Valley Bancorp Inc.
Stephen H. Wacknitz, 951-694-9940