Exhibit 99.1
Nara Bancorp Reports $0.33 Earnings
Per Diluted Share for Second Quarter 2007
LOS ANGELES--(BUSINESS WIRE)--July 25, 2007--Nara Bancorp, Inc.
(the "Company") (NASDAQ:NARA), the holding company of Nara Bank (the
"Bank"), reported net income of $8.8 million, or $0.33 per diluted
share, for second quarter 2007, an 11% increase over net income of
$7.9 million, or $0.30 per diluted share, for second quarter 2006.
Min Kim, President and Chief Executive Officer, said, "We had a
strong quarter in all areas of the business. Total loan production in
our commercial, commercial real estate and SBA lending businesses
increased more than 100% over the first quarter level, driving solid
growth in both net interest income and net gains generated from SBA
loan sales. We are pleased that we were able to generate this strong
revenue growth while maintaining tight expense control, resulting in
an efficiency ratio of 46.4%. Most importantly, our asset quality
remained very healthy. Following the satisfactory resolution of one
large non-performing loan identified last quarter, our non-performing
assets improved sequentially to 0.27% from 0.42% of total assets.
"As we previously announced, the MOU under which we were operating
was removed on July 12, 2007. We are very pleased that we were able to
simultaneously deliver strong performance while also completing the
work that was necessary to satisfy all elements of the MOU with our
regulatory agencies. The removal of the MOU is a major milestone for
the Bank that will open up more opportunities to create shareholder
value in the future. Management and the Board recognize that Nara is
now a much stronger bank as a result of implementing the multitude of
improvements necessary to satisfy the MOU," said Ms. Kim.
Second Quarter Financial Summary (2007 vs. 2006):
-- Net income increased 11% to $8.8 million
-- Diluted EPS increased 10% to $0.33 per share
-- Net interest income increased 3% to $24.2 million
-- Net interest margin of 4.72%
-- Non-interest income increased 38% to $6.1 million
-- Non-interest expense remained stable at $14.1 million
-- Net loans receivable increased 19% to $1.86 billion
-- Deposits increased 5% to $1.80 billion
-- Non-performing assets to total assets of 0.27%
Operating Results for Second Quarter 2007
Net Interest Income and Net Interest Margin. Second quarter 2007
net interest income before provision for loan losses increased 3% to
$24.2 million from $23.4 million for second quarter 2006. The
improvement was attributable to a $48.6 million, or 10%, increase in
net average interest-earning assets, which more than offset the 41
basis point decline in the net interest spread. The resulting second
quarter net interest margin (net interest income divided by average
interest-earning assets) decreased 33 basis points to 4.72% from
5.05%.
The weighted average yield on the loan portfolio for second
quarter 2007 decreased 18 basis points to 8.84% from 9.02% for the
same period last year. The decline was the result of an increase in
the percentage of fixed-rate loans in the loan portfolio that have
lower yields, as borrowers migrated to fixed-rate loans at lower
interest rates during 2006 and 2007. The weighted average yield on the
variable-rate and fixed-rate portfolios at June 30, 2007 were 9.21%
and 7.73%, respectively, compared to 9.27% and 7.62% at June 30, 2006.
At June 30, 2007, 46% of the loan portfolio consisted of fixed-rate
loans, compared to 28% at June 30, 2006.
The weighted average cost of deposits for second quarter 2007
increased 50 basis points to 3.82% from 3.32% for the same period last
year. The cost of time deposits increased 59 basis points to 5.25%
from 4.66%, accounting for a substantial portion of the increase. The
weighted average cost of borrowings for second quarter 2007 decreased
141 basis points to 5.46% from 6.87% for second quarter 2006. The
reduction in the weighted average cost of borrowings is primarily
attributable to lower rates on FHLB advances and trust preferred
securities. The average cost for FHLB advances was 4.31% for second
quarter 2007, compared to 4.39% for second quarter 2006, and the
average cost of trust preferred securities was 8.71% for second
quarter 2007, compared to 8.94% for second quarter 2006.
Sequentially, second quarter 2007 net interest income before
provision for loan losses increased $1.5 million, or 6.5%, from first
quarter 2007. Net average interest-earning assets increased by $30.6
million, or 6.2%, and the net interest spread increased by 9 basis
points, resulting in an improvement of 10 basis points in the net
interest margin to 4.72% from 4.62%. During first quarter 2007, three
loans were transferred to non-accrual status, resulting in a reversal
of $350 thousand in interest income, which negatively affected the net
interest margin by 7 basis points in that quarter. Excluding these
items, the first quarter 2007 net interest margin would have been
4.69%.
Compared to first quarter 2007, the cost of total deposits
increased two basis points to 3.82% from 3.80%. The cost of time
deposits was 5.25%, three basis points higher than first quarter 2007.
At June 30, 2007, the spot rate for time deposits was 5.29%.
Prepayment penalty income for second quarter 2007, second quarter
2006, and first quarter 2007 was $524 thousand, $376 thousand and $142
thousand, respectively. Excluding the effects of non-accrual loan
interest income and prepayment penalty income, the net interest margin
for second quarter 2007, second quarter 2006, and first quarter 2007
was 4.61%, 4.97% and 4.66%, respectively.
Non-interest Income. Second quarter 2007 non-interest income was
higher by $1.7 million, or 38%, compared to second quarter 2006. This
increase was primarily due to an increase in net gains on sales of SBA
and other loans. Net gains on sales of SBA loans increased $641
thousand, or 58%, to $1.7 million for second quarter 2007 from $1.1
million for second quarter 2006. The increase was primarily due to a
167% increase in loans originated and a 94% increase in SBA loans
sold. The Bank also sold $18.7 million of commercial real estate loans
during second quarter 2007 in order to manage internal concentration
limits, which resulted in gains of $754 thousand.
Sequentially, non-interest income increased 33%, primarily due to
the increase in net gains on sales of SBA and other loans. Net gains
on sales of SBA and other loans increased 104% to $2.5 million during
second quarter 2007, compared to $1.2 million in first quarter 2007.
Non-interest Expense. Second quarter non-interest expense was
$14.1 million, the same level as second quarter 2006. Compensation
expense decreased 5% over the same quarter of the prior year primarily
due to a decrease in accrued bonuses which was partially offset by an
increase in salaries and in stock-based compensation expense.
Occupancy expense increased 10%, primarily due to increased lease
expense for four branch lease renewals and increased lease expense
related to the relocation of our corporate headquarters during the
second half of 2006. Furniture and equipment expense increased 25%,
primarily due to the new corporate headquarters, and IT-related
equipment purchased to support and enhance the Company's technology.
Advertising and marketing expense decreased 33%, primarily due to the
special promotion expense incurred during the second quarter of 2006
tied to the World Cup Soccer event. Professional fees increased by
$267 thousand, or 34%, primarily due to legal fees related to the
arbitration matter mentioned during first quarter 2007.
Sequentially, non-interest expense in second quarter 2007
increased less than 1% to $14.1 million from $13.9 million in first
quarter 2007. The annual increase in salaries, which took effect in
the second quarter of 2007 was offset by lower bonus accruals in 2007.
Included in compensation expense during first quarter 2007 was a
reversal of a $600 thousand bonus accrual established during 2002
related to a past compensation matter for which the Company has now
determined that the liability no longer exists. Advertising and
marketing expense and data processing expense also decreased 27% and
9%, respectively. Professional fees increased 24% primarily due to
legal expenses related to the arbitration matter.
Income Taxes. The effective tax rate was 41.2% for second quarter
2007 compared to 42.0% for second quarter 2006, and 41.1% for first
quarter 2007.
Balance Sheet Summary
At June 30, 2007 total assets were $2.22 billion, compared to
$2.12 billion at March 31, 2007, an increase of 17% (annualized).
Gross loans receivable were $1.88 billion at June 30, 2007, an
increase of 30% (annualized) from the $1.75 billion at March 31, 2007.
New loan production was $282 million during second quarter 2007,
compared to $206 million during second quarter 2006 and $139 million
during first quarter 2007. Loan pay-offs during second quarter 2007,
second quarter 2006 and first quarter 2007 were $106 million, $110
million and $67 million, respectively.
SBA loan originations were $57.3 million during second quarter
2007 compared to $21.5 million during second quarter 2006 and $28.1
million during first quarter 2007. Sales of SBA loans during second
quarter 2007 were $33.4 million, compared to $17.2 million during
second quarter 2006 and $25.0 million during first quarter 2007.
Total deposits were $1.80 billion at June 30, 2007, an increase of
11% (annualized) from $1.75 billion at March 31, 2007. The largest
increases came in money market deposits and jumbo certificates of
deposit. Money market deposits increased $44 million, or 81%
(annualized), and jumbo CDs increased $21 million, or 10%
(annualized), from March 31, 2007. The increase in money market
accounts was largely due to a new product developed in fourth quarter
2006 with a rate of 5.0% and promoted during 2007 in an effort to
attract core deposits.
FHLB advances were $120.0 million at June 30, 2007 compared to
$100.0 million at March 31, 2007. The increase in FHLB advances is
part of the Company's strategy to augment deposits with borrowings as
a source of match-funding of fixed-rate loan originations. The
weighted average cost of FHLB advances was 4.31%, compared to 4.39%
during second quarter of 2006, and 4.21% during first quarter of 2007.
Asset Quality
The Company recorded a provision for loan losses of $1.4 million
in second quarter 2007, compared to $142 thousand in the same period
of the prior year, and $980 thousand in first quarter 2007. The
increase in provision for loan losses reflects the growth in the loan
portfolio.
Non-performing assets at June 30, 2007 were $6.0 million, or 0.27%
of total assets, compared to $8.9 million, or 0.42% of total assets,
at March 31, 2007.
Non-performing loans at June 30, 2007 were $5.8 million, or 0.31%
of total loans, compared to $8.7 million, or 0.50% of total loans, at
March 31, 2007. The decrease in non-performing loans during the
quarter was primarily due to the sale of a $3.3 million non-performing
loan, collateralized by commercial real estate property in San Diego.
The loan was sold at a 1% premium.
Net loan charge-offs during second quarter 2007 were $1.0 million,
or 0.22% of average loans on an annualized basis, compared to $1.3
million during first quarter 2007, or 0.31% of average loans on an
annualized basis.
The allowance for loan losses at June 30, 2007 was $19.1 million,
or 1.02% of gross loans receivable, compared to $18.8 million, or
1.07% of gross loans receivable, at March 31, 2007.
Performance Ratios
The annualized return on average equity (ROE) for second quarter
2007 was 17.53%, compared to 15.26% for first quarter 2007 and 19.75%
for second quarter 2006.
The annualized return on average assets (ROA) for second quarter
2007 was 1.63%, compared to 1.41% for first quarter 2007 and 1.62% for
second quarter 2006.
The efficiency ratio for second quarter 2007 was 46.38%, compared
to 51.01% for first quarter 2007 and 50.57% for second quarter 2006.
The improvement in the efficiency ratio over first quarter 2007 was
due to the growth in net interest income and non-interest income and
the nominal growth in non-interest expense for the second quarter of
2007.
Capital
At June 30, 2007, the Company continued to exceed the regulatory
capital requirements to be classified as a "well-capitalized
institution." The Leverage Ratio was 11.10% compared to 11.18% at
December 31, 2006. The Tier 1 Risk-based Ratio was 11.87% compared to
12.16% at December 31, 2006. The Total Risk-based Ratio was 12.83%
compared to 13.21% at December 31, 2006.
Earnings Outlook
The Company narrowed its range of EPS guidance for the full year
2007. Based on the year-to-date results and the outlook for the second
half of 2007, the Company now expects fully diluted earnings per share
to range between $1.29 and $1.31 in 2007.
Commenting on the outlook, Ms. Kim said, "We expect to see a
continuation of the trends we experienced in the second quarter. Our
investment in additional business development officers and loan
production offices is having a positive impact on our revenue growth.
The pipeline remains healthy in all of our lending businesses, which
should help us generate sufficient volume to offset further
compression in our net interest margin. We expect that we will
continue to be able to effectively control our deposit costs and
non-interest expense, which should help us to continue delivering
solid bottom line performance over the remainder of 2007."
Conference Call and Webcast
A conference call with simultaneous webcast to discuss the
Company's second quarter 2007 financial results will be held tomorrow,
July 26, 2007 at 9:30 a.m. Pacific / 12:30 p.m. Eastern. Interested
participants and investors may access the conference call by dialing
866-825-1692 (domestic) or 617-213-8059 (international), passcode
50242072. There will also be a live webcast 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 2, 2007; the passcode is 29187444.
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 19 branches and 8 loan production
offices in the United States. Nara Bank operates full-service branches
in California and New York, with loan production offices in
California, Washington, 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 6/30/2007 3/31/2007 % change
----------------------------------
Cash and due from banks $ 34,434 $ 31,600 9%
Federal funds sold 10,000 82,000 -88%
Securities available for sale, at
fair value 194,925 176,071 11%
Securities held to maturity, at
amortized cost (fair value: June
30, 2007 - $0; December 31, 2006 -
$1,002) - - -
Federal Home Loan Bank and Federal
Reserve Bank stock 10,772 9,868 9%
Loans held for sale, at the lower of
cost or market 17,154 7,978 115%
Loans receivable 1,878,970 1,749,242 7%
Allowance for loan losses (19,101) (18,752) 2%
----------------------------------
Net loans receivable 1,859,869 1,730,490 7%
----------------------------------
Accrued interest receivable 9,074 8,664 5%
Premises and equipment, net 11,585 11,972 -3%
Cash surrender value of life
insurance 15,660 15,548 1%
Goodwill 2,347 2,347 0%
Other intangible assets, net 2,570 2,735 -6%
Other assets 47,583 43,956 8%
----------------------------------
Total assets $2,215,973 $2,123,229 4%
==================================
Liabilities
Deposits $1,798,460 $1,750,976 3%
Borrowings from Federal Home Loan
Bank 120,000 100,000 20%
Subordinated debentures 39,268 39,268 0%
Accrued interest payable 10,586 10,840 -2%
Other liabilities 45,332 27,396 65%
----------------------------------
Total liabilities 2,013,646 1,928,480 4%
----------------------------------
Stockholders' Equity
Common stock, $0.001 par value;
authorized, 40,000,000 shares;
issued and outstanding, 26,181,672,
26,131,672, 26,107,672 and
25,751,704 shares at June 30, 2007,
March 31 2007, December 31, 2006
and June 30, 2006, respectively $ 26 $ 26 0%
Capital surplus 79,108 78,563 1%
Retained earnings 126,811 118,761 7%
Accumulated other comprehensive
income (loss), net (3,618) (2,601) 39%
----------------------------------
Total stockholders' equity 202,327 194,749 4%
----------------------------------
Total liabilities and
stockholders' equity $2,215,973 $2,123,229 4%
==================================
Assets 12/31/2006 % change 6/30/2006 % change
--------------------------------------------
Cash and due from banks $ 36,300 -5% $ 37,001 -7%
Federal funds sold 44,500 -78% 96,200 -90%
Securities available for
sale, at fair value 162,851 20% 184,750 6%
Securities held to
maturity, at amortized
cost (fair value: June
30, 2007 - $0; December
31, 2006 - $1,002) 1,000 -100% 1,000 -100%
Federal Home Loan Bank and
Federal Reserve Bank
stock 9,758 10% 9,562 13%
Loans held for sale, at
the lower of cost or
market 15,162 13% 13,037 32%
Loans receivable 1,714,865 10% 1,584,913 19%
Allowance for loan losses (19,112) 0% (18,168) 5%
--------------------------------------------
Net loans receivable 1,695,753 10% 1,566,745 19%
--------------------------------------------
Accrued interest
receivable 8,974 1% 7,786 17%
Premises and equipment,
net 11,941 -3% 9,082 28%
Cash surrender value of
life insurance 15,113 4% 14,885 5%
Goodwill 2,347 0% 2,347 0%
Other intangible assets,
net 2,899 -11% 3,244 -21%
Other assets 40,387 18% 41,841 14%
--------------------------------------------
Total assets $ 2,046,985 8% $1,987,480 11%
============================================
Liabilities
Deposits $ 1,712,235 5% $1,719,576 5%
Borrowings from Federal
Home Loan Bank 76,000 58% 31,000 287%
Subordinated debentures 39,268 0% 39,268 0%
Accrued interest payable 8,258 28% 9,414 12%
Other liabilities 24,597 84% 25,713 76%
--------------------------------------------
Total liabilities 1,860,358 8% 1,824,971 10%
--------------------------------------------
Stockholders' Equity
Common stock, $0.001 par
value; authorized,
40,000,000 shares; issued
and outstanding,
26,181,672, 26,131,672,
26,107,672 and 25,751,704
shares at June 30, 2007,
March 31 2007, December
31, 2006 and June 30,
2006, respectively $ 26 0% $ 26 0%
Capital surplus 77,939 1% 73,239 8%
Retained earnings 111,978 13% 95,387 33%
Accumulated other
comprehensive income
(loss), net (3,316) 9% (6,143) -41%
--------------------------------------------
Total stockholders'
equity 186,627 8% 162,509 25%
--------------------------------------------
Total liabilities and
stockholders' equity $ 2,046,985 8% $1,987,480 11%
============================================
Nara Bancorp, Inc.
Consolidated Statements of Income
Unaudited (Dollars in Thousands, Except for Per Share Data)
Three Months Ended
-----------------------------------------------------
6/30/2007 3/31/2007 % change 6/30/2006 % change
-----------------------------------------------------
Interest income:
Interest and
fees on loans $ 40,289 $ 38,244 5% $ 34,977 15%
Interest on
securities 2,105 2,053 3% 2,060 2%
Interest on
federal funds
sold and other
investments 682 495 38% 1,461 -53%
-----------------------------------------------------
Total
interest
income 43,076 40,792 6% 38,498 12%
-----------------------------------------------------
Interest expense:
Interest on
deposits 16,903 16,299 4% 13,924 21%
Interest on
other
borrowings 1,963 1,758 12% 1,171 68%
-----------------------------------------------------
Total
interest
expense 18,866 18,057 4% 15,095 25%
-----------------------------------------------------
Net interest
income before
provision for
loan losses 24,210 22,735 6% 23,403 3%
Provision for
loan losses 1,350 980 38% 142 851%
-----------------------------------------------------
Net interest
income after
provision for
loan losses 22,860 21,755 5% 23,261 -2%
-----------------------------------------------------
Non-interest
income:
Service fees on
deposit
accounts 1,685 1,620 4% 1,520 11%
Net gains on
sales of SBA
and other
loans 2,491 1,220 104% 1,096 127%
Other income
and fees 1,935 1,764 10% 1,820 6%
-----------------------------------------------------
Total non-
interest
income 6,111 4,604 33% 4,436 38%
-----------------------------------------------------
Non-interest
expense:
Salaries and
employee
benefits 6,723 6,714 0% 7,083 -5%
Occupancy 2,109 2,075 2% 1,918 10%
Furniture and
equipment 684 625 9% 548 25%
Advertising and
marketing 484 662 -27% 725 -33%
Data
processing
and
communications 870 954 -9% 1,018 -15%
Professional
fees 1,049 846 24% 782 34%
Other 2,144 2,070 4% 2,004 7%
-----------------------------------------------------
Total non-
interest
expense 14,063 13,946 1% 14,078 0%
-----------------------------------------------------
Income before
income taxes 14,908 12,413 20% 13,619 9%
Income taxes 6,138 5,105 20% 5,719 7%
-----------------------------------------------------
Net Income $ 8,770 $ 7,308 20% $ 7,900 11%
=====================================================
Earnings Per
Share:
Basic $ 0.34 $ 0.28 $ 0.31
Diluted $ 0.33 $ 0.28 $ 0.30
Average Shares
Outstanding:
Basic 26,165,254 26,123,405 25,612,359
Diluted 26,502,862 26,537,416 26,221,043
Six Months Ended June 30,
--------------------------------
2007 2006 % change
--------------------------------
Interest income:
Interest and fees on loans $ 78,533 $ 67,581 16%
Interest on securities 4,158 3,944 5%
Interest on federal funds sold and
other investments 1,177 2,253 -48%
--------------------------------
Total interest income 83,868 73,778 14%
--------------------------------
Interest expense:
Interest on deposits 33,202 25,513 30%
Interest on other borrowings 3,721 2,293 62%
--------------------------------
Total interest expense 36,923 27,806 33%
--------------------------------
Net interest income before provision
for loan losses 46,945 45,972 2%
Provision for loan losses 2,330 1,222 91%
--------------------------------
Net interest income after provision
for loan losses 44,615 44,750 0%
--------------------------------
Non-interest income:
Service fees on deposit accounts 3,305 3,057 8%
Net gains on sales of SBA and other
loans 3,711 2,813 32%
Other income and fees 3,699 3,608 3%
--------------------------------
Total non-interest income 10,715 9,478 13%
--------------------------------
Non-interest expense:
Salaries and employee benefits 13,437 13,894 -3%
Occupancy 4,184 3,734 12%
Furniture and equipment 1,309 1,068 23%
Advertising and marketing 1,146 1,276 -10%
Data processing and communications 1,824 1,971 -7%
Professional fees 1,895 1,460 30%
Other 4,214 3,856 9%
--------------------------------
Total non-interest expense 28,009 27,259 3%
--------------------------------
Income before income taxes 27,321 26,969 1%
Income taxes 11,243 11,189 0%
--------------------------------
Net Income $ 16,078 $ 15,780 2%
================================
Earnings Per Share:
Basic $ 0.61 $ 0.62
Diluted $ 0.61 $ 0.60
Average Shares Outstanding:
Basic 26,144,445 25,542,636
Diluted 26,522,521 26,168,550
Nara Bancorp, Inc.
Supplemental Data
Unaudited (Dollars in Thousands, Except for Per Share Data)
(Annualized) (Annualized)
At or for the Three At or for the Six
Months Ended Months Ended
----------------------------- -------------------
Profitability
measures: 6/30/2007 3/31/2007 6/30/2006 6/30/2007 6/30/2006
----------------------------- -------------------
ROA 1.63% 1.41% 1.62% 1.52% 1.67%
ROE 17.53% 15.26% 19.74% 16.41% 20.22%
Net interest
margin, including
loan prepayment
fee income 4.72% 4.62% 5.05% 4.67% 5.11%
Net interest
margin, excluding
loan prepayment
fee income 4.61% 4.59% 4.97% 4.60% 5.05%
Efficiency ratio 46.38% 51.01% 50.57% 48.58% 49.16%
Yield on loan
portfolio 8.84% 8.71% 9.02% 8.78% 8.86%
Yield on interest-
earning assets 8.39% 8.29% 8.31% 8.34% 8.20%
Cost of interest-
bearing deposits 4.89% 4.84% 4.26% 4.86% 4.04%
Cost of total
deposits 3.82% 3.80% 3.32% 3.81% 3.13%
Cost of interest-
bearing
liabilities 4.94% 4.91% 4.39% 4.93% 4.18%
Cost of time
deposits 5.25% 5.22% 4.66% 5.24% 4.45%
Cost of funds 3.94% 3.93% 3.45% 3.93% 3.28%
Net interest spread
(yield on average
interest-earning
assets - average
cost of funds) 4.45% 4.36% 4.86% 4.41% 4.92%
For the Three Months Ended
---------------------------------------------------
6/30/2007 3/31/2007 % change 6/30/2006 % change
---------------------------------------------------
AVERAGE BALANCES
Gross loans,
includes loans
held for sale $1,823,323 $1,755,760 4% $1,550,453 18%
Interest-earning
assets 2,053,087 1,967,142 4% 1,853,200 11%
Total assets 2,156,121 2,066,373 4% 1,946,639 11%
Interest-bearing
deposits 1,383,014 1,348,086 3% 1,307,485 6%
Interest-bearing
liabilities 1,526,908 1,471,577 4% 1,375,668 11%
Non-interest-
bearing demand
deposits 387,143 368,043 5% 372,093 4%
Stockholders'
Equity 200,162 191,604 4% 160,055 25%
Net interest-
earning assets 526,179 495,565 6% 477,532 10%
For the Six Months Ended
------------------------------
6/30/2007 6/30/2006 % change
------------------------------
AVERAGE BALANCES
Gross loans, includes loans held for
sale $1,789,728 $1,525,454 17%
Interest-earning assets 2,010,352 1,799,362 12%
Total assets 2,111,496 1,891,743 12%
Interest-bearing deposits 1,365,647 1,263,151 8%
Interest-bearing liabilities 1,499,395 1,331,391 13%
Non-interest-bearing demand deposits 377,646 366,308 3%
Stockholders' Equity 195,908 156,102 25%
Net interest-earning assets 510,957 467,971 9%
LOAN PORTFOLIO COMPOSITION: 6/30/2007 3/31/2007 % change
-------------------------------
Commercial loans $ 624,873 $ 562,406 11%
Real estate loans 1,217,296 1,145,196 6%
Consumer and other loans 38,792 43,945 -12%
-------------------------------
Loans outstanding 1,880,961 1,751,547 7%
Unamortized deferred loan fees - net of
costs (1,991) (2,305) -14%
-------------------------------
Loans, net of deferred loan fees and
costs 1,878,970 1,749,242 7%
Allowance for loan losses (19,101) (18,752) 2%
-------------------------------
Loan receivable, net $1,859,869 $1,730,490 7%
===============================
LOAN PORTFOLIO COMPOSITION: 12/31/2006 % change 6/30/2006 % change
----------------------------------------
Commercial loans $ 565,759 10% $ 499,450 25%
Real estate loans 1,102,072 10% 1,033,277 18%
Consumer and other loans 49,201 -21% 55,022 -29%
----------------------------------------
Loans outstanding 1,717,032 10% 1,587,749 18%
Unamortized deferred loan fees
- net of costs (2,167) -8% (2,836) -30%
----------------------------------------
Loans, net of deferred loan
fees and costs 1,714,865 10% 1,584,913 19%
Allowance for loan losses (19,112) 0% (18,168) 5%
----------------------------------------
Loan receivable, net $ 1,695,753 10% $1,566,745 19%
========================================
For the Three Months Ended
-------------------------------------------------------
ALLOWANCE FOR
LOAN LOSSES: 6/30/2007 3/31/2007 % Change 6/30/2006 % Change
-------------------------------------------------------
Balance at
Beginning of
Period $ 18,752 $ 19,112 -2% $ 18,398 2%
Provision for
Loan Losses 1,350 980 38% 142 851%
Recoveries 396 191 107% 724 -45%
Charge-Offs (1,397) (1,531) -9% (1,096) 27%
-------------------------------------------------------
Balance at End
of Period $ 19,101 $ 18,752 2% $ 18,168 5%
=======================================================
Net charge-
off/Average
gross loans
(annualized) 0.22% 0.31% 0.10%
For the Six Months Ended
---------------------------------
ALLOWANCE FOR LOAN LOSSES: 6/30/2007 6/30/2006 % Change
---------------------------------
Balance at Beginning of Period $ 19,112 $ 17,618 8%
Provision for Loan Losses 2,330 1,222 91%
Recoveries 586 1,075 -45%
Charge-Offs (2,927) (1,747) 68%
---------------------------------
Balance at End of Period $ 19,101 $ 18,168 5%
=================================
Net charge-off/Average gross loans
(annualized) 0.26% 0.09%
NON-PERFORMING ASSETS 6/30/2007 3/31/2007 12/31/2006 6/30/2006
------------------------------------ -----------
Delinquent Loans 90
days or more on Non-
Accrual Status $ 5,757 $ 8,722 $ 3,271 $ 3,329
Delinquent Loans 90
days or more on
Accrual Status - - - -
------------------------------------ -----------
Total Non-Performing
Loans 5,757 8,722 3,271 3,329
Other real estate
owned - - - -
Restructured Loans 222 192 298 757
------------------------------------ -----------
Total Non-Performing
Assets $ 5,979 $ 8,914 $ 3,569 $ 4,086
==================================== ===========
Non-Performing
Assets/Total Assets 0.27% 0.42% 0.17% 0.21%
Non-Performing
Loans/Gross Loans 0.31% 0.50% 0.19% 0.21%
Allowance for loan
losses/Gross Loans 1.02% 1.07% 1.11% 1.15%
Allowance for loan
losses/Non-Performing
Loans 332% 215% 584% 546%
DEPOSIT COMPOSITION 6/30/2007 3/31/2007 % Change
-------------------------------
Non-interest-bearing demand deposits $ 396,074 $ 383,525 3%
Money market and other 259,241 215,694 20%
Saving deposits 144,381 141,754 2%
Time deposits of $100,000 or more 829,940 809,154 3%
Other time deposits 168,824 200,849 -16%
--------------------- ---------
Total deposit balances $1,798,460 $1,750,976 3%
===================== =========
DEPOSIT COMPOSITION 12/31/2006 % Change 6/30/2006 % Change
----------------------------------------
Non-interest-bearing demand
deposits $ 407,519 -3% $ 405,271 -2%
Money market and other 184,199 41% 228,435 13%
Saving deposits 141,611 2% 139,854 3%
Time deposits of $100,000 or
more 768,727 8% 740,431 12%
Other time deposits 210,179 -20% 205,585 -18%
----------------------------------------
Total deposit balances $ 1,712,235 5% $1,719,576 5%
========================================
DEPOSIT COMPOSITION (%) 6/30/2007 3/31/2007 12/31/2006 6/30/2006
----------------------------------------
Non-interest-bearing demand
deposits 22.1% 21.9% 23.8% 23.6%
Money market and other 14.4% 12.3% 10.7% 13.3%
Saving deposits 8.0% 8.1% 8.3% 8.1%
Time deposits of $100,000 or
more 46.1% 46.2% 44.9% 43.1%
Other time deposits 9.4% 11.5% 12.3% 11.9%
----------------------------------------
Total deposit balances 100.0% 100.0% 100.0% 100.0%
========================================
CAPITAL RATIOS 6/30/2007 3/31/2007 12/31/2006 6/30/2006
------------------------------------------------
Total stockholders'
equity $ 202,327 $ 194,749 $ 186,627 $ 162,509
Tier 1 risk-based
capital ratio 11.87% 12.29% 12.16% 11.80%
Total risk-based
capital ratio 12.83% 13.30% 13.21% 12.86%
Tier 1 leverage ratio 11.10% 11.16% 11.18% 10.35%
Book value per share $ 7.73 $ 7.45 $ 7.15 $ 6.31
Tangible book value
per share $ 7.54 $ 7.25 $ 6.95 $ 6.09
Tangible equity to
tangible assets 8.93% 8.95% 8.88% 7.92%
CONTACT: Investors and Financial Media:
Financial Relations Board
Tony Rossi, 213-486-6540