Exhibit 99.1
Nara Bancorp Reports 30% Increase in Earnings Per Share for Second Quarter 2006
LOS ANGELES--(BUSINESS WIRE)--July 26, 2006--Nara Bancorp, Inc. (the
"Company") (NASDAQ:NARA), the holding company of Nara Bank (the "Bank"),
reported net income of $7.9 million for the second quarter of 2006, an increase
of 41% over $5.6 million for the second quarter of 2005. The Company also
reported earnings of $0.30 per diluted share for second quarter 2006, a 30%
increase compared to $0.23 per diluted share for the second quarter of 2005.
"Despite a challenging operating environment, we are pleased with the
Bank's steady performance in the second quarter," said Min Kim, Chief Operating
Officer and Acting President of Nara Bancorp. "Our financial results were driven
by solid loan production, successful campaigns to attract core deposits, and
meaningful improvement in credit quality. Our success in these areas helped to
offset higher levels of loan payoffs than we expected, a reduction in our net
interest margin from our first quarter 2006 results, and a temporary shortfall
in SBA originations due to a change in the management of this business line.
Overall, we continue to execute well on our strategic initiatives to generate
disciplined growth through effective balance sheet management, focusing on core
deposits and strong credit quality."
Second Quarter Financial Highlights (2006 vs. 2005):
-- Net income increased 41% to $7.9 million
-- Diluted EPS increased 30% to $0.30 per share
-- Net interest income increased 21% to $23.0 million
-- Annualized net interest margin increased 3 basis points to 4.97%
-- Net loans receivable increased 14% over prior year to $1.57 billion
-- Deposits increased 15% over prior year to $1.72 billion
Operating Results for Second Quarter 2006
Net Interest Income and Net Interest Margin. Second quarter net interest
income before provision for loan losses increased 21% to $23.0 million from
$19.0 million for second quarter 2005. The improvement was attributable to an
18% increase in net average interest-earning assets. The resulting annualized
net interest margin (net interest income divided by average interest-earning
assets) increased 3 basis points to 4.97% in the second quarter of 2006 from
4.94% in the same period of the prior year.
The weighted average annualized yield on the loan portfolio for second
quarter 2006 increased 138 basis points to 8.93% from 7.55% for the same period
last year. The increase was the result of the Company's substantially prime
rate-based loan portfolio repricing upward with each federal funds increase by
the Federal Reserve.
The weighted average annualized cost of deposits for second quarter 2006
increased 126 basis points to 3.32% from 2.06% for the same period last year.
The most significant increase was seen in annualized time deposit costs, which
increased 158 basis points to 4.66% from 3.08% last year.
Sequentially, second quarter 2006 net interest income before provision for
loan losses increased $662 thousand, or 3%, over first quarter 2006. The
annualized net interest margin for second quarter 2006 was 4.97%, a decrease of
16 basis points from the net interest margin of 5.13% for first quarter 2006.
This margin compression was primarily due to money market and time deposit
repricing, average interest-bearing deposit growth exceeding loan growth, and
the increase in fixed rate loans.
Non-interest Income. Second quarter non-interest income decreased $216
thousand, or 4%, to $4.8 million from $5.0 million for the same period last
year. The decrease was primarily due to non-recurring gains of $128 thousand on
sales of securities during the second quarter of 2005.
Sequentially, non-interest income in second quarter 2006 decreased $460
thousand, or 9%, from $5.3 million in first quarter 2006. This decrease was
primarily due to a decrease in gains on sales of SBA loans. The volume of SBA
loans sold during the second quarter was $17.2 million compared to $24.5 million
in first quarter 2006. Total originations of SBA loans during the second quarter
2006 were $21.5 million compared to $35.4 million in first quarter 2006. The
slowdown in SBA loan production was primarily due to the transition to new
management of this business line towards the end of the second quarter.
Non-interest Expense. Second quarter non-interest expense increased $1.6
million, or 13%, to $14.1 million from $12.5 million for the same period last
year. The increase was driven by higher compensation costs due to staff and
management additions and the new requirement to recognize stock option expense;
higher occupancy costs due to opening or commencement of leasing of new
branches; marketing costs, mostly advertising, relating to deposit campaigns and
new Fullerton office; higher data processing fees from increased accounts; and
higher D&O and FDIC insurance premiums.
Sequentially, non-interest expense in second quarter 2006 increased $869
thousand, or 7%, to $14.1 million from $13.2 million in first quarter 2006. This
increase was primarily due to increases in salaries and employee benefits,
occupancy costs, advertising and marketing expenses, and professional fees.
Salaries and employee benefit expenses were higher due to an increase in the
amount of bonus accrued and stock option expense. Occupancy costs were higher
due to the Oakland branch lease payment which commenced in March of 2006 and new
leasehold improvement costs for the new Fullerton office. Advertising and
marketing expenses were higher during second quarter 2006 due to new deposit
campaigns, including promotions tied to the World Cup soccer tournament.
Professional fees were higher during second quarter 2006 due to increased
outsourced internal audit fees and costs related to the CEO and other senior
officer searches.
Income Taxes. The effective tax rate was 42% for the second quarters of
2006 and 2005.
Balance Sheet Summary
At June 30, 2006 total assets were $1.99 billion compared to $1.91 billion
at March 31, 2006 and $1.72 billion at June 30, 2005, increases of 16%
(annualized) and 16%, respectively.
Gross loans receivable, excluding loans held for sale of $13.0 million,
were $1.58 billion at June 30, 2006, an increase of 14% from the $1.39 billion
at June 30, 2005, and an increase of 16% (annualized) from the $1.52 billion at
March 31, 2006. The growth in the loan portfolio was primarily driven by the
real estate loan portfolio, which increased 23% year-over-year, and 24%
(annualized) since March 31, 2006. Higher than expected loan payoffs, driven by
an increasing trend of refinancing variable loans for fixed rate loans as well
as higher levels of property and business sales by borrowers, mitigated the
overall portfolio growth during the second quarter of 2006.
Total deposits were $1.72 billion at June 30, 2006, an increase of 15% from
$1.50 billion at June 30, 2005, and an increase of 17% (annualized) from March
31, 2006. Deposit growth was largely driven by annualized increases in money
market, non-interest bearing, and non-jumbo time deposit accounts of 19%, 32%,
and 49%, respectively, resulting from a bank-wide core deposit campaign during
the second quarter of 2006.
Asset Quality
Non-performing assets at June 30, 2006 declined to $4.1 million, or 0.21%
of total assets, from $5.4 million, or 0.28% of total assets, at March 31, 2006.
Non-performing loans at June 30, 2006 declined to $3.3 million, or 0.21% of
total loans, from $4.6 million, or 0.30% of total loans, at March 31, 2006. The
sequential quarter decrease in non-performing loans at June 30, 2006 was
primarily due to one large credit being placed back on accrual status during the
quarter and charge-offs.
Net loan charge-offs were $372 thousand for second quarter 2006, or 0.10%
of average loans on an annualized basis, compared to $300 thousand, or 0.08% of
average loans on annualized basis for first quarter 2006.
The provision for loan losses was $142 thousand for the second quarter of
2006, compared to $1.1 million for the first quarter of 2006. The lower
provision for loan losses was primarily due to a $8.9 million improvement in
classified and special mention loans during the second quarter of 2006.
The allowance for loan losses at June 30, 2006 was $18.2 million, or 1.15%
of gross loans receivable, compared to $18.4 million, or 1.21% of gross loans
receivable at March 31, 2006
Performance Ratios
The annualized return on average equity (ROE) for second quarter 2006 was
19.75%, compared to 20.72% for first quarter 2006, and 20.58% for second quarter
2005. The 2006 second quarter ROE declined from the 2005 second quarter
primarily due to the increase in equity resulting from the $20.0 million of
capital raised in September 2005.
The annualized return on average assets (ROA) for second quarter 2006 was
1.62%, compared to 1.72% for the first quarter 2006, and 1.38% for the second
quarter 2005.
The efficiency ratio for second quarter 2006 was 50.57%, compared to 47.79%
for first quarter 2006, and 51.83% for second quarter 2005. The higher
efficiency ratio in the second quarter was attributable to slower growth in net
interest income, a decrease in non-interest income and increased non-interest
expenses, such as salaries and employee benefits, occupancy costs, and
marketing-related expenses and professional fees.
Capital
At June 30, 2006, we continued to exceed the regulatory capital
requirements to be classified as a "well-capitalized institution." The Leverage
Ratio was 10.35% compared to 10.22% at December 31, 2005 and 8.84% at June 30,
2005. The Tier 1 Risk-based Ratio was 11.80% compared to 11.77% at December 31,
2005 and 9.69% at June 30, 2005. The Total Risk-based Ratio was 12.86% compared
to 12.90% at December 31, 2005 and 11.05% at June 30, 2005.
Outlook
For the full year 2006, Nara Bancorp continues to expect fully diluted
earnings per share to range between $1.20 and $1.25.
Commenting on the outlook, Ms. Kim said, "Over the second half of 2006, we
believe that continued strength in our loan production and declining
professional fees as we complete our regulatory compliance efforts should help
us offset the impact of further compression in our net interest margin and
elevated levels of loan payoffs. In addition, we have recently added a highly
productive SBA loan manager that we believe can quickly improve our SBA loan
production and help this business line become a catalyst for earnings growth in
future quarters."
Conference Call and Webcast
A conference call with simultaneous webcast to discuss the Company's second
quarter 2006 financial results will be held tomorrow, July 27, 2006 at 9:30 a.m.
Pacific/12:30 p.m. Eastern. Interested participants and investors may access the
conference call by dialing 866-713-8567 (domestic) or 617-597-5326
(international). There will also be a live web cast of the call available at the
Investor Relations section of Nara Bank's web site at www.narabank.com. Web
participants are encouraged to go to the web site at least 15 minutes prior to
the start of the call to register, download, and install any necessary audio
software.
After the live webcast, a replay will remain available in the Investor
Relations section of Nara Bancorp's web site. A replay of the call will be
available at 888-286-8010 (domestic) or 617-801-6888 (international) through
August 3, 2006; the passcode is 21402479.
About Nara Bancorp, Inc.
Nara Bancorp, Inc. is the parent company of Nara Bank, which was founded in
1989. Nara Bank is a full-service community bank headquartered in Los Angeles,
with 18 branches and 8 loan production offices in the United States and one
liaison office in Seoul, Korea. Nara Bank operates full-service branches in
California and New York, with loan production offices in California, Washington,
Colorado, Texas, Georgia, Illinois, New Jersey, and Virginia. Nara Bank was
founded specifically to serve the needs of Korean-Americans, one of the
fastest-growing Asian ethnic communities over the past decade. Presently, Nara
Bank serves a diverse group of customers mirroring its communities. Nara Bank
specializes in core business banking products for small and medium-sized
companies, with emphasis in commercial real estate and business lending, SBA
lending, and international trade financing. Nara Bank is a member of the FDIC
and is an Equal Opportunity Lender. For more information on Nara Bank, visit our
web site at www.narabank.com. Nara Bancorp, Inc. stock is listed on NASDAQ under
the symbol "NARA."
Forward-Looking Statements
This press release contains forward-looking statements, including
statements about future operations and projected full-year financial results
that are subject to risks and uncertainties that could cause actual results to
differ materially from those expressed or implied by such forward-looking
statements, including, but not limited to, economic, competitive, governmental,
and technological factors affecting the Company's operations, markets, products,
services, and pricing. Readers should carefully review the risk factors and the
information that could materially affect the Company's financial results and
business, described in documents the Company files from time to time with the
Securities and Exchange Commission, including its quarterly reports on Form 10-Q
and Annual Reports on Form 10-K, and particularly the discussion of business
considerations and certain factors that may affect results of operations and
stock price set forth therein. Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the date of this
press release. The Company undertakes no obligation to revise or publicly
release the results of any revision to these forward-looking statements.
Nara Bancorp, Inc.
Consolidated Statements of Financial Condition
Unaudited (Dollars in Thousands)
Assets 6/30/2006 3/31/2006 % change
---------------------------------
Cash and due from banks $37,001 $38,306 -3%
Federal funds sold 96,200 75,500 27%
Term federal funds sold - 7,000 -100%
Securities available for sale, at
fair value 184,750 185,653 0%
Securities held to maturity, at
amortized cost (fair value: June
30, 2006 - $1,008; March 31, 2006 -
$1,015; December 31, 2005 - $1,023;
June 30, 2005 - $2,052) 1,000 1,000 0%
Federal Home Loan Bank and Federal
Reserve Bank stock 9,562 8,341 15%
Loans held for sale, at the lower of
cost or market 13,037 15,422 -15%
Loans receivable 1,584,913 1,524,377 4%
Allowance for loan losses (18,168) (18,398) -1%
---------------------------------
Net loans 1,566,745 1,505,979 4%
---------------------------------
Accrued interest receivable 7,786 7,694 1%
Premises and equipment, net 9,082 8,575 6%
Cash surrender value of life
insurance 14,885 14,775 1%
Goodwill 2,347 2,347 0%
Other intangible assets, net 3,244 3,416 -5%
Other assets 41,841 37,302 12%
---------------------------------
Total assets $1,987,480 $1,911,310 4%
=================================
Liabilities
Deposits $1,719,576 $1,650,623 4%
Borrowings from Federal Home Loan
Bank 31,000 31,000 0%
Subordinated debentures 39,268 39,268 0%
Accrued interest payable 9,414 11,655 -19%
Other liabilities 25,713 24,307 6%
---------------------------------
Total liabilities 1,824,971 1,756,853 4%
---------------------------------
Stockholders' Equity
Common stock, $0.001 par value;
authorized, 40,000,000 shares;
issued and outstanding, 25,751,704,
25,557,948, 25,444,442 and
23,694,596 shares at June 30, 2006,
March 31, December 31, 2005 and
June 30, 2005, respectively $26 $25 4%
Capital surplus 73,239 70,900 3%
Retained earnings 95,387 88,192 8%
Accumulated other comprehensive
income (loss), net (6,143) (4,660) 32%
---------------------------------
Total stockholders' equity 162,509 154,457 5%
---------------------------------
Total liabilities and
stockholders' equity $1,987,480 $1,911,310 4%
=================================
Assets 12/31/2005 % change 6/30/2005 % change
--------------------- ---------------------
Cash and due from banks $32,924 12% $32,672 13%
Federal funds sold 33,100 191% 77,400 24%
Term federal funds sold 7,000 -100% 12,000 -100%
Securities available for
sale, at fair value 174,709 6% 131,246 41%
Securities held to
maturity, at amortized
cost (fair value: June
30, 2006 - $1,008; March
31, 2006 - $1,015;
December 31, 2005 -
$1,023; June 30, 2005 -
$2,052) 1,001 0% 2,001 -50%
Federal Home Loan Bank and
Federal Reserve Bank
stock 8,266 16% 8,129 18%
Loans held for sale, at
the lower of cost or
market 17,083 -24% 11,631 12%
Loans receivable 1,445,740 10% 1,387,280 14%
Allowance for loan losses (17,618) 3% (16,769) 8%
-------------------------------------------
Net loans 1,428,122 10% 1,370,511 14%
-------------------------------------------
Accrued interest
receivable 7,620 2% 6,164 26%
Premises and equipment,
net 8,148 11% 6,837 33%
Cash surrender value of
life insurance 14,640 2% 14,433 3%
Goodwill 2,347 0% 2,347 0%
Other intangible assets,
net 3,589 -10% 3,947 -18%
Other assets 37,273 12% 38,063 10%
-------------------------------------------
Total assets $1,775,822 12% $1,717,381 16%
===========================================
Liabilities
Deposits $1,526,486 13% $1,496,523 15%
Borrowings from Federal
Home Loan Bank 31,000 0% 43,000 -28%
Subordinated debentures 39,268 0% 39,268 0%
Accrued interest payable 8,755 8% 4,518 108%
Other liabilities 23,559 9% 21,105 22%
-------------------------------------------
Total liabilities 1,629,068 12% 1,604,414 14%
-------------------------------------------
Stockholders' Equity
Common stock, $0.001 par
value; authorized,
40,000,000 shares; issued
and outstanding,
25,751,704, 25,557,948,
25,444,442 and 23,694,596
shares at June 30, 2006,
March 31, December 31,
2005 and June 30, 2005,
respectively $25 4% $23 13%
Capital surplus 69,451 5% 47,465 54%
Retained earnings 81,016 18% 66,573 43%
Accumulated other
comprehensive income
(loss), net (3,738) 64% (1,094) 462%
-------------------------------------------
Total stockholders'
equity 146,754 11% 112,967 44%
-------------------------------------------
Total liabilities and
stockholders' equity $1,775,822 12% $1,717,381 16%
===========================================
Nara Bancorp, Inc.
Consolidated Statements of Income
Unaudited (Dollars in Thousands, Except for Per Share Data)
Three Months Ended,
----------------------------------------------------
% %
6/30/2006 3/31/2006 change 6/30/2005 change
----------------------------------------------------
Interest income:
Interest and
fees on loans $34,601 $32,400 7% $25,762 34%
Interest on
securities 2,060 1,884 9% 1,389 48%
Interest on
federal funds
sold and
other
investments 1,461 792 84% 345 323%
----------------------------------------------------
Total
interest
income 38,122 35,076 9% 27,496 39%
----------------------------------------------------
Interest expense:
Interest on
deposits 13,924 11,589 20% 7,074 97%
Interest on
other
borrowings 1,171 1,122 4% 1,426 -18%
----------------------------------------------------
Total
interest
expense 15,095 12,711 19% 8,500 78%
----------------------------------------------------
Net interest
income before
provision for
loan losses 23,027 22,365 3% 18,996 21%
Provision for
loan losses 142 1,080 -87% 1,950 -93%
----------------------------------------------------
Net interest
income after
provision for
loan losses 22,885 21,285 8% 17,046 34%
----------------------------------------------------
Non-interest
income:
Service fees on
deposit
accounts 1,520 1,537 -1% 1,582 -4%
Net gains on
sales of SBA
loans 1,096 1,717 -36% 1,094 0%
Net gains on
sales of
securities
available-for-
sale - - 0% 128 -100%
Other income
and fees 2,197 2,019 9% 2,225 -1%
----------------------------------------------------
Total non-
interest
income 4,813 5,273 -9% 5,029 -4%
----------------------------------------------------
Non-interest
expense:
Salaries and
employee
benefits 7,083 6,811 4% 6,152 15%
Occupancy 1,918 1,816 6% 1,692 13%
Furniture and
equipment 548 520 5% 497 10%
Advertising and
marketing 725 551 32% 464 56%
Data processing
and
communications 1,018 953 7% 860 18%
Professional
fees 782 678 15% 1,186 -34%
Other 2,004 1,880 7% 1,602 25%
----------------------------------------------------
Total non-
interest
expense 14,078 13,209 7% 12,453 13%
----------------------------------------------------
Income before
income taxes 13,620 13,349 2% 9,622 42%
Income taxes 5,719 5,470 5% 4,009 43%
----------------------------------------------------
Net Income $7,901 $7,879 0% $5,613 41%
====================================================
Earnings Per
Share:
Basic $0.31 $0.31 $0.24
Diluted $0.30 $0.30 $0.23
Average Shares
Outstanding
Basic 25,612,359 25,473,400 23,653,365
Diluted 26,221,043 26,140,846 24,538,181
Six Months Ended June 30,
---------------------------------
2006 2005 % change
---------------------------------
Interest income:
Interest and fees on loans $67,001 $48,217 39%
Interest on securities 3,944 2,789 41%
Interest on federal funds sold
and other investments 2,253 584 286%
---------------------------------
Total interest income 73,198 51,590 42%
---------------------------------
Interest expense:
Interest on deposits 25,513 12,532 104%
Interest on other borrowings 2,293 2,730 -16%
---------------------------------
Total interest expense 27,806 15,262 82%
---------------------------------
Net interest income before provision
for loan losses 45,392 36,328 25%
Provision for loan losses 1,222 3,600 -66%
---------------------------------
Net interest income after provision
for loan losses 44,170 32,728 35%
---------------------------------
Non-interest income:
Service fees on deposit accounts 3,057 3,160 -3%
Net gains on sales of SBA loans 2,813 1,843 53%
Net gains on sales of securities
available-for-sale - 143 -100%
Other income and fees 4,216 4,062 4%
---------------------------------
Total non-interest income 10,086 9,208 10%
---------------------------------
Non-interest expense:
Salaries and employee benefits 13,894 11,415 22%
Occupancy 3,734 3,288 14%
Furniture and equipment 1,068 1,007 6%
Advertising and marketing 1,276 854 49%
Data processing and communications 1,971 1,656 19%
Professional fees 1,460 1,942 -25%
Other 3,884 2,991 30%
---------------------------------
Total non-interest expense 27,287 23,153 18%
---------------------------------
Income before income taxes 26,969 18,783 44%
Income taxes 11,189 7,765 44%
---------------------------------
Net Income $15,780 $11,018 43%
=================================
Earnings Per Share:
Basic $0.62 $0.47
Diluted $0.60 $0.45
Average Shares Outstanding
Basic 25,542,636 23,504,411
Diluted 26,168,550 24,634,849
Nara Bancorp, Inc.
Supplemental Data
Unaudited (Dollars in Thousands, Except for Per Share Data)
(Annualized) (Annualized)
At or for the Three Months At or for the Six
Ended, Months Ended,
------------------------------------------------------
Profitability
measures: 6/30/2006 3/31/2006 6/30/2005 6/30/2006 6/30/2005
-------------------------------- ---------------------
ROA 1.62% 1.72% 1.38% 1.67% 1.39%
ROE 19.75% 20.72% 20.58% 20.22% 20.58%
Net interest
margin 4.97% 5.13% 4.94% 5.05% 4.86%
Efficiency
ratio 50.57% 47.79% 51.83% 49.19% 50.85%
Yield on loan
portfolio 8.93% 8.64% 7.55% 8.78% 7.30%
Yield on
interest-
earning
assets 8.23% 8.04% 7.15% 8.14% 6.91%
Cost of
interest-
bearing
deposits 4.26% 3.80% 2.78% 4.04% 2.56%
Cost of total
deposits 3.32% 2.94% 2.06% 3.13% 1.89%
Cost of
interest-
bearing
liabilities 4.39% 3.95% 2.99% 4.18% 2.77%
Cost of time
deposits 4.66% 4.22% 3.08% 4.45% 2.83%
Cost of funds 3.45% 3.09% 2.27% 3.28% 2.10%
Net interest
spread
(yield on
average
interest-
earning
assets -
average cost
of funds) 4.77% 4.95% 4.87% 4.86% 4.80%
For the Three Months Ended
-------------------------------------------------------
6/30/2006 3/31/2006 % change 6/30/2005 % change
-------------------------------------------------------
AVERAGE
BALANCES
Gross loans,
includes
loans held
for sale $1,550,453 $1,500,177 3% $1,365,423 14%
Interest-
earning
assets 1,853,200 1,744,924 6% 1,538,850 20%
Total assets 1,946,639 1,836,238 6% 1,630,918 19%
Interest-
bearing
deposits 1,307,485 1,218,324 7% 1,016,345 29%
Interest-
bearing
liabilities 1,375,668 1,286,621 7% 1,138,082 21%
Non-interest-
bearing
demand
deposits 372,093 360,460 3% 357,148 4%
Stockholders'
Equity 160,055 152,105 5% 109,120 47%
For the Six Months Ended
--------------------------------
6/30/2006 6/30/2005 % change
--------------------------------
AVERAGE BALANCES
Gross loans, includes loans held for
sale 1,525,454 1,321,858 15%
Interest-earning assets 1,799,362 1,494,030 20%
Total assets 1,891,743 1,582,032 20%
Interest-bearing deposits 1,263,151 979,298 29%
Interest-bearing liabilities 1,331,391 1,103,914 21%
Non-interest-bearing demand deposits 366,308 346,509 6%
Stockholders' Equity 156,102 107,051 46%
LOAN PORTFOLIO COMPOSITION: 6/30/2006 3/31/2006 % change
---------------------------------
Commercial loans $499,450 $495,080 1%
Real estate loans 1,033,277 973,903 6%
Consumer and other loans 55,022 58,214 -5%
---------------------------------
Loans outstanding 1,587,749 1,527,197 4%
Unamortized deferred loan fees - net
of costs (2,836) (2,820) 1%
---------------------------------
Loans, net of deferred loan fees
and costs 1,584,913 1,524,377 4%
Allowance for loan losses (18,168) (18,398) -1%
---------------------------------
Loan receivable, net $1,566,745 $1,505,979 4%
=================================
LOAN PORTFOLIO
COMPOSITION: 12/31/2005 % change 6/30/2005 % change
-------------------------------------------
Commercial loans $483,231 3% $481,226 4%
Real estate loans 900,699 15% 842,131 23%
Consumer and other loans 64,633 -15% 67,010 -18%
-------------------------------------------
Loans outstanding 1,448,563 10% 1,390,367 14%
Unamortized deferred loan
fees - net of costs (2,823) 0% (3,087) -8%
-------------------------------------------
Loans, net of deferred
loan fees and costs 1,445,740 10% 1,387,280 14%
Allowance for loan losses (17,618) 3% (16,769) 8%
-------------------------------------------
Loan receivable, net $1,428,122 10% $1,370,511 14%
===========================================
For the Three Months Ended
----------------------------------------------------
ALLOWANCE FOR
LOAN LOSSES: 6/30/2006 3/31/2006 % Change 6/30/2005 % Change
----------------------------------------------------
Balance at
Beginning of
Period $18,398 $17,618 4% $15,715 17%
Provision for
Loan Losses 142 1,080 -87% 1,950 -93%
Recoveries 724 351 106% 89 713%
Charge Offs (1,096) (651) 68% (985) 11%
----------------------------------------------------
Balance at End of
Period $18,168 $18,398 -1% $16,769 8%
====================================================
Net charge-
off/Average
gross loans
(annualized) 0.10% 0.08% 0.26%
For the Six Months Ended
-------------------------------
ALLOWANCE FOR LOAN LOSSES: 6/30/2006 6/30/2005 % Change
-------------------------------
Balance at Beginning of Period $17,618 $14,627 20%
Provision for Loan Losses 1,222 3,600 -66%
Recoveries 1,075 383 181%
Charge Offs (1,747) (1,841) -5%
-------------------------------
Balance at End of Period $18,168 $16,769 8%
===============================
Net charge-off/Average gross loans
(annualized) 0.09% 0.22%
NON-PERFORMING ASSETS 6/30/2006 3/31/2006 12/31/2005 6/30/2005
--------------------------------------------
Delinquent Loans 90 days
or more on Non-Accrual
Status $3,329 $4,589 $5,489 $2,772
Delinquent Loans 90 days
or more on Accrual
Status - - - 86
--------------------------------------------
Total Non-Performing
Loans 3,329 4,589 5,489 2,858
Other real estate owned - - - -
Restructured Loans 757 807 741 1,067
--------------------------------------------
Total Non-Performing
Assets $4,086 $5,396 $6,230 $3,925
============================================
Non-Performing Assets/
Total Assets 0.21% 0.28% 0.35% 0.23%
Non-Performing
Loans/Gross Loans 0.21% 0.30% 0.38% 0.21%
Allowance for loan
losses/ Gross Loans 1.15% 1.21% 1.22% 1.21%
Allowance for loan
losses/ Non-Performing
Loans 546% 401% 321% 587%
DEPOSIT COMPOSITION 6/30/2006 3/31/2006 % Change
---------------------------------
Non-interest-bearing demand
deposits $405,271 $375,672 8%
Money market and other 228,435 218,235 5%
Saving deposits 139,854 141,327 -1%
Time deposits of $100,000 or more 740,431 732,348 1%
Other time deposits 205,585 183,041 12%
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Total deposit balances $1,719,576 $1,650,623 4%
======================= =========
DEPOSIT COMPOSITION 12/31/2005 % Change 6/30/2005 % Change
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Non-interest-bearing
demand deposits $371,943 9% $367,516 10%
Money market and other 185,550 23% 266,829 -14%
Saving deposits 120,948 16% 99,623 40%
Time deposits of
$100,000 or more 714,636 4% 662,394 12%
Other time deposits 133,409 54% 100,161 105%
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Total deposit balances $1,526,486 13% $1,496,523 15%
===========================================
DEPOSIT COMPOSITION (%) 6/30/2006 3/31/2006 12/31/2005 6/30/2005
--------------------------------------------
Non-interest-bearing
demand deposits 23.6% 22.7% 24.4% 24.5%
Money market and other 13.3% 13.2% 12.2% 17.8%
Saving deposits 8.1% 8.6% 7.9% 6.7%
Time deposits of
$100,000 or more 43.1% 44.4% 46.8% 44.3%
Other time deposits 11.9% 11.1% 8.7% 6.7%
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Total deposit
balances 100.0% 100.0% 100.0% 100.0%
============================================
CAPITAL RATIOS 6/30/2006 3/31/2006 12/31/2005 6/30/2005
--------------------------------------------
Total stockholders'
equity $162,509 154,457 $146,754 $112,967
Tier 1 risk-based
capital ratio 11.80% 11.67% 11.77% 9.69%
Total risk-based
capital ratio 12.86% 12.79% 12.90% 11.05%
Tier 1 leverage ratio 10.35% 10.45% 10.22% 8.84%
Book value per share $6.31 $6.04 $5.77 $4.77
Tangible book value per
share $6.09 $5.82 $5.53 $4.50
Tangible equity to
tangible assets 7.92% 7.80% 7.96% 6.23%
CONTACT: Investors and Financial Media:
Financial Relations Board
Tony Rossi, 310-854-8317