Exhibit 99.1
COLUMBIA BANCORP REPORTS STRONG THIRD QUARTER PROFITS,
22% INCREASE IN NET INCOME
THE DALLES, Ore., Oct. 26 /PRNewswire-FirstCall/ -- Columbia Bancorp
(Nasdaq: CBBO), the financial holding company for Columbia River Bank, today
reported strong third quarter profitability, with solid deposit and loan
growth.
-- 3Q05 Return on Equity (ROE) of 19.14%, Year-to-Date ROE of 19.51%
-- 3Q05 Return on Assets (ROA) of 1.78%, Year-to-Date ROA of 1.82%
-- 3Q05 Net Interest Margin (tax equivalent) (NIM) of 6.01%, Year-to-Date
NIM of 5.91%
-- 3Q05 Efficiency Ratio of 52.50%, Year-to-Date Efficiency Ratio of
53.57%
Third quarter net income grew 22% to $3.5 million, or $0.38 per diluted
share, compared to $2.9 million, or $0.32 per diluted share, in the same quarter
a year ago. In the first three quarters of 2005, net income increased 42% to
$10.3 million, or $1.13 per diluted share, compared to $7.2 million, or $0.80
per diluted share for the first three quarters in 2004.
During the third quarter 2005, the Company recognized $230,000, or $0.03 per
diluted share, of income tax benefit associated with the 2005 Oregon corporate
tax kicker credit. The credit is provided by the Oregon Constitution when the
state's actual tax revenues exceed forecasted revenues by more than 2%. During
the second quarter 2005, a gain of $561,000 from the sale of the mortgage
servicing asset occurred which added $0.04 per diluted share, and in the first
quarter 2005, the one-time collection of $336,000 in previously non-accrual
interest from 2004, which added $0.02 diluted per share earnings.
The Bank's loan portfolio quality remains strong as it is superior to its
national peer group, as detailed in the Federal Financial Institutions
Examinations Council's report for commercial banks with assets between $300.0
million and $1.0 billion, dated June 30, 2005.
COMPANY BUSINESS TRENDS
Columbia Bancorp President and CEO, Roger Christensen reiterated that the
Bank continues to focus its efforts in three areas: expansion, deposit base
growth and operational efficiency.
"Our future plans include expansion into communities where the Columbia
River Bank brand will be positively received," he said. "This will ultimately
benefit our customers, employees and shareholders. In the third quarter, we
began building branches at Cherry Heights in The Dalles, Oregon, and in Pasco,
Washington."
Christensen also noted the Company is using proprietary relationship
management models to further its deposit growth objectives and strengthen
customer relationships. The model is built to improve customer relationships by
focusing our attention on the potential profit opportunities. Christensen cited
these efforts will result in deeper relationships with the Bank's customers and
an ability to grow deposits in Columbia's branch network to meet internal
expectations.
Finally, the Bank has focused on new technologies to promote efficiency and
on finalizing compliance with "Check 21," the new Federal check processing
standard. "Our technology focus is on continually improving the Bank's
efficiencies," said Chief Operating Officer and Executive Vice President, Craig
Ortega. "Those improvements have the added benefit of serving our customers
better, particularly our small business customers."
INCOME STATEMENT PERFORMANCE
Revenue (net interest income plus non-interest income) for the third quarter
increased 21% to $13.6 million, compared to $11.2 million in the third quarter a
year ago. Year-to-date revenues increased 22% to $38.6 million from $31.6
million in the first nine months of 2004. The year-to-date 2005 revenues include
the effects of non-recurring items of $230,000 from the Oregon corporate tax
"kicker" credit, $561,000 from the sale of the mortgage servicing asset and
collection of $336,000 of prior year non-accrual interest income. Net interest
income before provision for loan losses grew 20% to $11.1 million for the third
quarter and 18% to $30.8 million in the first nine months of 2005, compared to
$9.2 million and $26.1 million in the respective periods of 2004.
The provision for loan losses totaled $1.2 million in the third quarter and
$2.1 million year to date. This compares to $550,000 in provision for loan
losses for the third quarter 2004 and $2.6 million for the year ended 2004.
The tax equivalent net interest margin was 6.01% for the third quarter and
5.91% year-to-date 2005, as compared to 5.86% and 6.08% in the like periods of
2004.
Greg Spear, Chief Financial Officer and Executive Vice President, pointed to
net interest margin (NIM) trends: "Our net interest margin is comprised of three
primary components: retail generated net interest income, loan fees and
investment income. The third quarter's NIM grew beyond the second quarter's
largely because of the growth in investment income associated with federal funds
sold. These liquid assets have re-priced at higher amounts each time the federal
funds rate was increased by the Federal Reserve Board."
Non-interest income for the third quarter totaled $2.5 million as compared
to $2.0 million in the third quarter of 2004 and totaled $7.8 million for the
first nine months of 2005 as compared to $5.5 million in the like period of
2004.
Overhead expenses increased in the current quarter reflecting continued
growth in the branch network, investment in training and higher personnel costs.
For the third quarter of 2005, non-interest expense was $7.1 million compared to
$6.0 million in the third quarter of 2004. For the first nine months of 2005,
non-interest expense was $20.7 million compared to $17.6 million in same period
last year.
The efficiency ratio for the third quarter of 2005 was 52.50% as compared to
53.70% for the same period a year ago. As for the first nine months of 2005, the
efficiency ratio was 53.57% as compared to 55.51% for the same period last year.
The efficiency ratio is an important measure of productivity in the banking
industry and it is calculated by dividing non-interest expense by net interest
income and non-interest income, which measures overhead costs as a percentage of
total revenues.
BALANCE SHEET PERFORMANCE
The loan portfolio grew 14% to $659.4 million at September 30, 2005,
compared to $578.3 million at September 30, 2004.
Total assets grew 14% to $821.0 million at September 30, 2005, compared to
$720.5 million a year earlier. Shareholders' equity increased 19% to $74.6
million, or $8.35 per outstanding share at September 30, 2005, compared to $63.0
million or $7.15 per share at September 30, 2004. Tangible book value per common
share at September 30, 2005, was $7.53 compared to $6.04 at September 30, 2004.
Total deposits increased 16% to $714.5 million at September 30, 2005,
compared to $615.1 million at September 30, 2004.
ASSET QUALITY
Asset quality remains strong at the end of the third quarter with
non-performing assets of $1.4 million, or 0.17% of total assets, compared to
$5.3 million or 0.74% of total assets a year ago. Net charge-offs in the third
quarter totaled approximately $709,000, or 0.11% of gross loans, compared to
$340,000, or 0.06% of gross loans in the same quarter of 2004. For the first
nine months of the year, net charge-offs were $1.1 million or 0.16% of gross
loans, nearly identical as compared to $1.1 million, or 0.19% of gross loans a
year ago.
The allowance for loan loss was $9.2 million, or 1.40% of gross loans, at
September 30, 2005, compared to $8.2 million or 1.41% of gross loans for the
same period last year.
EARNINGS TELECONFERENCE AND WEBCAST
Columbia will conduct a Teleconference and Webcast on Wednesday, October 26,
2005, at 12:00 noon Pacific Time (3:00 p.m. Eastern Time) when management, led
by Roger Christensen, will discuss Columbia's third quarter 2005 and year to
date results, outlook and related matters. To participate in the call dial
1-866-202-0886, the conference ID is 12176271. The live Webcast can be heard by
going to Columbia Bancorp's web site, www.columbiabancorp.com, and clicking on
Presentations/Webcasts under the Investor Relations section.
The call replay will be available starting two hours after the completion of
the live call until November 1, 2005. To listen to the replay dial
1-888-286-8010 and use access code 80545121. The Webcast will be archived on
Columbia Bancorp's website.
ABOUT COLUMBIA BANCORP
Columbia Bancorp (www.columbiabancorp.com) is the financial holding company
for Columbia River Bank, which operates 20 branches located in The Dalles (2),
Hood River, Bend (4), Madras, Redmond (2), Pendleton, Hermiston, McMinnville
(3), Canby and Newberg, Oregon, and in Goldendale, White Salmon and Kennewick,
Washington. Columbia River Bank also provides mortgage-lending services through
Columbia River Bank Mortgage Team and brokerage services through CRB Financial
Services Team.
FORWARD LOOKING STATEMENTS
This press release contains various forward-looking statements about plans
and anticipated results of operations and financial condition relating to
Columbia Bancorp. These statements include statements about Management's present
plans and intentions about our strategy, growth, and deployment of resources,
and about Management's expectations for future financial performance. Readers
can sometimes identify forward-looking statements by the use of prospective
language and context, including words like "may," "will," "should," "expect,"
"anticipate," "estimate," "continue," "plans," "intends," or other similar
terminology. Because forward-looking statements are, in part, an attempt to
project future events and explain Management's current plans, they are subject
to various risks and uncertainties that could cause our actions and our
financial and operational results to differ materially from those set forth in
such statements. These risks and uncertainties include, without limitation, our
ability to estimate accurately the value of certain of our intangible asset,
economic and other factors that affect the collectibility of our loans, the
impact of competition and fluctuations in market interest rates on Columbia's
revenues and margins, Management's ability to open and generate growth from new
branches, and other risks and uncertainties that we have in the past, or that we
may from time to time in the future, detail in our filings with the Securities
and Exchange Commission ("SEC"). Information presented in this report is
accurate as of the date the report was filed with the SEC, and we do not
undertake to update our forward-looking statements or the factors that may cause
us to deviate from them, except as required by law.
INCOME STATEMENT
(Unaudited)
(In thousands, except per share data and ratios)
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30,
------------------------- % ------------------------- %
2005 2004 Change 2005 2004 Change
----------- ----------- ----------- ----------- ----------- -----------
Interest income $ 13,998 $ 11,208 25% $ 38,886 $ 31,167 25%
Interest expense 2,937 2,026 45% 8,091 5,048 60%
Net interest income before
provision for loan losses 11,061 9,182 20% 30,795 26,119 18%
Provision for loan losses 1,230 550 124% 2,080 2,640 -21%
Net interest income
after provision for
loan losses 9,831 8,632 14% 28,715 23,479 22%
Non-interest income:
Service charges and fees 1,239 1,196 4% 3,602 3,443 5%
Credit card discounts
and fees 136 132 3% 366 350 5%
CRB Financial Services
Team revenues 174 93 87% 474 395 20%
Mortgage servicing, net -- (101) -- 172 (535) 132%
Gain on sale of mortgage
loans 6 85 -93% 81 165 -51%
Mortgage loan
origination income 434 203 114% 1,151 714 61%
Loss from sale of assets -- -- -- (38) -- --
Loss from sale or "call"
of securities -- (7) -- (1) (7) 86%
Gain from sale of
Mortgage Servicing Asset -- -- -- 561 -- --
Gain from sale of loans 3 95 -97% 3 95 -97%
Other non-interest
income 548 321 71% 1,456 894 63%
Total non-interest
income 2,540 2,017 26% 7,827 5,514 42%
Non-interest expense:
Salaries and employee
benefits 4,298 3,468 24% 12,029 9,776 23%
Occupancy expense 774 700 11% 2,334 1,898 23%
Data processing 123 124 -1% 346 378 -8%
Other non-interest
expense 1,946 1,722 13% 5,980 5,506 9%
Total non-interest
expense 7,141 6,014 19% 20,689 17,558 18%
Income before provision
for income taxes 5,230 4,635 13% 15,853 11,435 39%
Provision for income taxes 1,704 1,737 -2% 5,572 4,205 33%
Net income $ 3,526 $ 2,898 22% $ 10,281 $ 7,230 42%
Earnings per common share
Basic $ 0.39 $ 0.33 20% $ 1.15 $ 0.82 41%
Diluted 0.38 0.32 20% 1.13 0.80 41%
Cumulative dividend per
common share 0.09 0.09 -- 0.27 0.27 --
Book value per common
share $ 8.35 $ 7.15 17%
Tangible book value per
common share (1) 7.53 6.04 25%
Weighted average shares
outstanding
Basic 8,932 8,803 8,902 8,786
Diluted 9,167 9,037 9,127 9,026
Actual shares outstanding 8,936 8,811 8,936 8,811
Quarter Ended Year to Date
------------------------- -------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
RATIOS 2005 2004 2005 2004
- --------------------------------------------- ----------- ----------- ----------- -----------
Interest rate yield on interest-
earning assets, tax equivalent 7.59% 7.14% 7.45% 7.24%
Interest rate expense on interest-
bearing liabilities 2.31% 1.79% 2.21% 1.64%
Interest rate spread, tax equivalent 5.28% 5.35% 5.24% 5.60%
Net interest margin, tax equivalent 6.01% 5.86% 5.91% 6.08%
Efficiency ratio (2) 52.50% 53.70% 53.57% 55.51%
Return on average assets 1.78% 1.68% 1.82% 1.52%
Return on average equity 19.14% 18.60% 19.51% 16.02%
Average equity / average assets 9.27% 9.04% 9.35% 9.51%
(1) Total common equity, less goodwill and other intangible assets, divided by
actual shares outstanding.
(2) Non-interest expense divided by net interest income and non-interest income.
BALANCE SHEET
(Unaudited)
(In thousands, except per share data)
Year over Year to
Sept. 30, Sept. 30, Year % Dec. 31, Date %
2005 2004 Change 2004 Change
----------- ----------- ----------- ----------- -----------
ASSETS
Cash and cash equivalents $ 97,445 $ 80,087 22% $ 57,979 68%
Investment securities 38,973 32,242 21% 45,398 -14%
Loans:
Commercial loans 101,914 93,643 9% 93,618 9%
Agricultural loans 82,543 80,977 2% 79,224 4%
Real estate loans 293,056 228,463 28% 247,045 19%
Real estate loans -
construction 152,931 151,104 1% 139,415 10%
Consumer loans 13,386 15,466 -13% 14,386 -7%
Loans held for sale 7,254 1,573 361% 2,517 188%
Other loans 8,321 7,061 18% 7,660 9%
Total gross loans 659,405 578,287 14% 583,865 13%
Unearned loan fees (1,716) (1,757) 2% (1,556) -10%
Allowance for loan losses (9,202) (8,150) -13% (8,184) -12%
Net loans 648,487 568,380 14% 574,125 13%
Property and equipment, net 14,870 15,867 -6% 15,223 -2%
Goodwill 7,389 7,389 0% 7,389 0%
Mortgage servicing asset,
net -- 2,385 -100% 2,163 -100%
Other assets 13,884 14,186 -2% 13,096 6%
Total assets $ 821,048 $ 720,536 14% $ 715,373 15%
LIABILITIES
Deposits:
Non-interest bearing
demand deposits $ 228,144 $ 184,999 23% $ 172,422 32%
Interest bearing demand
deposits 267,321 201,127 33% 211,240 27%
Savings accounts 42,379 36,874 15% 35,926 18%
Time certificates 176,679 192,082 -8% 187,356 -6%
Total deposits 714,523 615,082 16% 606,944 18%
Borrowings 30,028 39,625 -24% 39,014 -23%
Other liabilities 1,859 2,863 -35% 3,538 -47%
Total liabilities 746,410 657,570 14% 649,496 15%
Shareholders' equity 74,638 62,966 19% 65,877 13%
Total liabilities and
shareholders' equity $ 821,048 $ 720,536 14% $ 715,373 15%
ADDITIONAL FINANCIAL INFORMATION
(Unaudited)
(In thousands, except quantities and ratios)
NON-PERFORMING ASSETS Sept. 30, 2005 Sept. 30, 2004
- ------------------------------------------ -------------- --------------
Delinquent loans on non-accrual status $ 1,345 $ 3,884
Delinquent loans on accrual status -- --
Restructured loans 43 --
Total non-performing loans 1,388 3,884
Other real estate owned -- 1,460
Total non-performing assets $ 1,388 $ 5,344
Total non-performing assets / total assets 0.17% 0.74%
Quarter Ended Year to Date
------------------------- -------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
ALLOWANCE FOR LOAN LOSSES 2005 2004 2005 2004
- ------------------------------------ ----------- ----------- ----------- -----------
Balance at beginning of period $ 8,681 $ 7,940 $ 8,184 $ 6,612
Provision for loan losses 1,230 550 2,080 2,640
Recoveries 50 25 158 61
Charge offs (759) (365) (1,220) (1,163)
Balance at end of period $ 9,202 $ 8,150 $ 9,202 $ 8,150
Allowance for loan losses / gross
loans and loans held for sale 1.40% 1.41%
Non-performing loans / allowance for
loan losses 15.09% 47.65%
Quarter Ended Year to Date
------------------------- -------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
FINANCIAL PERFORMANCE 2005 2004 2005 2004
- ------------------------------------ ----------- ----------- ----------- -----------
Average interest-earning assets $ 735,589 $ 629,560 $ 701,848 $ 579,996
Average gross loans and loans
held for sale 639,539 577,945 608,633 532,365
Average assets 787,963 685,915 753,925 633,732
Average interest-bearing
liabilities 504,569 450,551 490,152 411,023
Average interest-bearing deposits 473,381 411,299 455,384 373,259
Average deposits 680,893 580,686 646,069 532,119
Average liabilities 714,881 623,930 683,455 573,456
Average equity 73,081 61,985 70,470 60,277
Mortgage loans produced (quantity) 231 122 617 403
SOURCE Columbia Bancorp
-0- 10/26/2005
/CONTACT: Roger L. Christensen, President and CEO, +1-541-298-6633, or
rchristensen@columbiabancorp.com, or Greg B. Spear, Executive Vice President
and CFO, +1-541-298-6612, or gspear@columbiabancorp.com, both of Columbia
Bancorp/
/Web site: http://www.columbiabancorp.com /
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