Exhibit 99.1
Provident Community Bancshares, Inc.
Reports Earnings and Announces Quarterly Cash Dividend
UNION, S.C.--(BUSINESS WIRE)--Jan. 16, 2007--Provident Community
Bancshares, Inc. (NASDAQ: PCBS) reported operating results for the
fourth quarter and twelve months ended December 31, 2006. Net income
for the twelve months ended December 31, 2006 was $2.8 million, or
$1.48 per share (diluted), a 13.7% increase over the $2.5 million, or
$1.26 per share (diluted), for the twelve month period ending December
31, 2005. Net income for the three months ended December 31, 2006 was
$814,000 compared to $740,000 for the three months ended December 31,
2005. Earnings per share were $0.44 per share (diluted) for the fourth
quarter of 2006 versus $0.38 per share (diluted) for the fourth
quarter of 2005.
Net interest income before the loan loss provision for the fourth
quarter decreased $77,000, or 2.8%, to $2.6 million compared to $2.7
million. The decrease reflects higher funding costs over the previous
year period as a result of an increase in balances and rising rates
offset by higher average loan balances along with an increase in the
yield on loans that resulted from a higher concentration of consumer
and commercial loans. The provision for loan losses for the fourth
quarter totaled $115,000 compared to $100,000 for the same period in
the previous year. The increase in provision for loan losses was due
to a 20.7% increase in net loans over the previous year and a higher
concentration of commercial loans in the portfolio which carry a
higher risk of default, offset by a reduction in classified loans.
Non-interest income for the fourth quarter increased $142,000, or
23.6%, to $743,000 compared to $601,000 for the same period in the
previous year. The increase was due to higher fees for financial
services that resulted from an increase in transaction accounts.
Non-interest expense for the fourth quarter increased $150,000, or
6.9%, to $2.3 million compared to $2.2 million for the same period in
the previous year. The increase was due primarily to higher operating
costs associated with a banking center opening in Simpsonville, South
Carolina in March 2006 and the opening of a second banking center in
Rock Hill, South Carolina in October 2006. Income tax expense for the
fourth quarter reflected an effective tax rate of 13.5% compared to
28.9% for the same period in the previous year. The reduction was due
to a $156,000 tax benefit related to a prior year bank acquisition.
At December 31, 2006, assets totaled $388.2 million, a 4.6%
increase from $371.0 million at December 31, 2005. Net loans
receivable increased $39.9 million, or 20.7%, during the period to
$232.5 million at December 31, 2006, compared to $192.6 million at
December 31, 2005. The net growth in loans was driven by a 36.3%
increase in the commercial loan portfolio as the Company continued to
focus on this lending segment with specialized loan officers and
products. Reductions in lower-yielding investments and
mortgage-backed securities of $24.1 million and deposit growth of
$13.5 million funded the increase in loans. Shareholders' equity
increased $634,000, or 2.5%, to $26.0 million at December 31, 2006
from $25.3 million at December 31, 2005 due primarily to net income of
$2.8 million offset by the repurchase of 84,506 shares at a cost of
$1.5 million and dividend payments of $0.43 per share at a cost of
$806,000.
The Company also declared a quarterly cash dividend of 0.11 per
share payable on February 15, 2007 to shareholders of record on
January 30, 2007. Provident Community Bancshares, Inc. has a dividend
reinvestment plan and information about the plan can be obtained from
Registrar and Transfer Company at 800-368-5948.
Provident Community Bancshares is the holding company for
Provident Community Bank, N.A., which operates ten banking locations
in the upstate of South Carolina. At December 31, 2006, Provident
Community Bancshares had $388.2 million in total assets and total
stockholders' equity of $26.0 million. Please visit our website at
www.providentonline.com or contact Wanda J. Wells, SVP/Shareholder
Relations Officer at wwells@providentonline.com or Richard H. Flake,
EVP/CFO at rflake@providentonline.com.
Certain matters set forth in this news release may contain
forward-looking statements that are provided to assist in the
understanding of anticipated future financial performance. However,
such performance involves risks and uncertainties that may cause
actual results to differ materially from those in such statements. For
a discussion of certain factors that may cause such forward-looking
statements to differ materially from the Corporation's actual results,
see the Corporation's Quarterly Reports on Form 10-Q for the quarter
ended September 30, 2006, and the Corporation's Annual Report in Form
10-K for the year ended December 31, 2005.
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Provident Community Bancshares, Inc.
Fourth Quarter - Year Ending December 31, 2006
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Financial Highlights
(Unaudited) ($ in thousands, except per share data)
At At
Balance Sheet 12/31/06 12/31/05 $Change % Change
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Total assets $388,230 $371,042 17,188 4.63%
Cash and due from banks 9,124 8,380 744 8.88%
Investments & mortgage-backed
securities 122,185 146,283 (24,098) (16.47%)
Loans receivable (net) 232,486 192,577 39,909 20.72%
Goodwill and intangible assets 3,741 3,576 165 4.61%
Deposits 248,440 234,988 13,452 5.72%
Advances and other borrowings 98,533 100,330 (1,797) (1.79%)
Stockholders' equity 25,967 25,333 634 2.50%
Outstanding shares 1,830,528 1,905,897 (75,369) (3.95%)
Book value per share $14.19 $13.29 1 6.77%
Three Months Ended Twelve Months Ended
December 31, December 31,
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Income Statement 2006 2005 2006 2005
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Net interest income $2,637 $2,715 $10,524 $10,243
Provision for loan losses 115 100 470 869
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Net interest income after
loan loss provision 2,522 2,615 10,054 9,374
Non-interest income 743 601 2,876 2,543
Non-interest expense 2,324 2,175 9,178 8,537
Income tax 127 301 949 914
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Net income $814 $740 $2,803 $2,466
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Earnings per share: basic $0.44 $0.39 $1.50 $1.29
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Earnings per share: diluted $0.44 $0.38 $1.48 $1.26
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Weighted Average Number of
Common Shares Outstanding
Basic 1,834,261 1,914,617 1,865,951 1,914,357
Diluted 1,867,603 1,937,251 1,893,203 1,962,290
Twelve Months Ended
December 31,
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Key Financial Ratios 2006 2005
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Return on average assets 0.75% 0.68%
Return on average stockholders' equity 11.19% 9.68%
Operating expense to average assets 2.28% 2.17%
Equity to average assets 6.92% 6.88%
CONTACT: Provident Community Bancshares, Inc.
Dwight V. Neese, 864-429-1863
President & CEO