Exhibit 99.1
UNITED SECURITY BANCSHARES - 25.75% ROE FOR 1ST QUARTER OF 2006
FRESNO, Calif., April 11 /PRNewswire-FirstCall/ -- Dennis R. Woods,
President and Chief Executive Officer of United Security Bancshares (
http://www.unitedsecuritybank.com/ ) (Nasdaq: UBFO) reported today the results
of operations for the 1st quarter of 2006. Net income was $3,864,000, as
compared with $2,664,000 in 2005, an increase of 45.04% or $1,200,000.
Reported basic earnings per share for the 1st quarter were $0.68 compared
with $0.47 for 2005, a 44.7% increase. Diluted earnings per share for the
quarter were $0.67 compared with $0.47 a year ago, a 42.6% increase.
Woods said, "It's a real pleasure to report strong earnings to you for the
1st quarter. Earnings were up sharply, 45% over the same period a year ago. Two
one-time and two infrequent items increased net income for the 1st quarter by
$895,000. Without those items, net income for the 1st quarter 2006 would have
been $2,969,000, an increase of $305,000 or 11.5% over the same period in 2005."
For the three months just ended, return on average equity was 25.75% and the
return on average assets was 2.47%. For the same period in 2005, ROAE was 19.86%
and ROAA was 1.77%. These key ratios are indicative of the banks' strong
performance and ability to build shareholder value.
The 70th consecutive quarterly cash dividend of $0.22 per share, up from
$0.18 for a 22.2% increase from a year ago, was declared on March 28, 2006, to
be paid on April 19, 2006, to shareholders of record on April 7, 2006. In
addition, the Board of Directors approved a 2-for-1 stock split of the Company's
common stock effected in the form of a stock dividend. The stock will be payable
May 1st, 2006 to shareholders of record as of April 7, 2006. Stockholders will
receive one additional share for each share held on that date.
Shareholders' equity ended the quarter at $61,667,000, an increase of 14.3%
over March 31, 2005. Dividends of $4.4 million were paid out of shareholders'
equity to shareholders during the past 12 months and $378,000 was utilized to
purchase and retire shares of Company stock at an average price of $28.92.
Net interest income for the 1st quarter 2006 was $7.8 million, up $.7
million from 2005 for an increase of 9.2%. The net interest margin increased
from 5.37% in 2005 to 5.66% in 2006. The increase is primarily attributable to
the increases in volumes and interest rates on earning assets.
Noninterest income for the 1st quarter of 2006 was $3,207,000, up from
$1,323,000 in 2005 for an increase of $1,884,000 or 142.4%. Two one-time items
made up $1,817,000 of the increase in 2006, a $1,877,000 gain on the sale of an
investment and a decline in ATM fees of $60,000 resulting from a lag in revenue
from changing service providers.
1st quarter operating expenses for the three months ended March 31 were
$4,548,000 for 2006 and $4,016,000 for 2005, an increase of $533,000 or 13.3%.
Two infrequent items made up $337,000 of the increase in 2006; a $254,000
expense associated with OREO property and $83,000 in recruitment fees.
The provision for loan loss was $240 thousand for the 1st quarter of 2006
and $251 thousand for 2005. In determining the adequacy of the allowance for
loan loss, management's judgment is the primary determining factor for
establishing the amount of the provision for loan losses and is considered
adequate for the current period.
Non-performing assets decreased to 2.02% of total assets on March 31, 2006
from 3.19% at March 31, 2005.
United Security Bancshares is a $630+ million bank holding company. United
Security Bank, its principal subsidiary is a state chartered bank and member of
the Federal Reserve Bank of San Francisco.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended and the Company intends such
statements to be covered by the safe harbor provisions for forward-looking
statements contained in the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on management's knowledge and belief as
of today and include information concerning the Company's possible or assumed
future financial condition, and its results of operations, business and earnings
outlook. These forward-looking statements are subject to risks and
uncertainties. A number of factors, some of which are beyond the Company's
ability to control or predict, could cause future results to differ materially
from those contemplated by such forward-looking statements. These factors
include (1) changes in interest rates, (2) significant changes in banking laws
or regulations, (3) increased competition in the company's market, (4) other-
than-expected credit losses, (5) earthquake or other natural disasters impacting
the condition of real estate collateral, (6) the effect of acquisitions and
integration of acquired businesses, (7) the impact of proposed and/or recently
adopted changes in regulatory, judicial, or legislative tax treatment of
business transactions, particularly recently enacted California tax legislation
and the subsequent Dec. 31, 2003, announcement by the Franchise Tax Board
regarding the taxation of REITs and RICs; and (8) unknown economic impacts
caused by the State of California's budget issues. Management cannot predict at
this time the severity or duration of the effects of the recent business
slowdown on our specific business activities and profitability. Weaker or a
further decline in capital and consumer spending, and related recessionary
trends could adversely affect our performance in a number of ways including
decreased demand for our products and services and increased credit losses.
Likewise, changes in interest rates, among other things, could slow the rate of
growth or put pressure on current deposit levels and affect the ability of
borrowers to repay loans. Forward- looking statements speak only as of the date
they are made, and the company does not undertake to update forward-looking
statements to reflect circumstances or events that occur after the date the
statements are made, or to update earnings guidance including the factors that
influence earnings. For a more complete discussion of these risks and
uncertainties, see the Company's Annual Report on Form 10-K for the year ended
December 31, 2005, and particularly the section of Management's Discussion and
Analysis.
United Security Bancshares
Consolidated Balance Sheets
(unaudited)
(Dollars in thousands)
March 31, March 31,
2006 2005
---------- ----------
Cash & noninterest-bearing deposits in
other banks $ 26,241 $ 29,580
Interest-bearing deposits in other banks 7,713 7,484
Federal funds sold 25,690 19,150
Investment securities AFS 93,815 113,350
Loans, net of unearned fees 441,284 409,341
Less: allowance for loan losses (7,958) (7,324)
Loans, net 433,326 402,018
Premises and equipment, net 11,222 8,909
Intangible assets 3,417 3,954
Other assets 38,520 34,154
TOTAL ASSETS $ 639,945 $ 618,599
Deposits:
Noninterest-bearing demand & NOW $ 199,160 $ 195,624
Savings 36,065 35,531
Time 311,966 310,096
Total deposits 547,191 541,251
Borrowed funds 7,000 0
Other liabilities 8,623 7,924
Junior subordinated debentures 15,464 15,464
TOTAL LIABILITIES $ 578,277 $ 564,639
Shareholders' equity:
Common shares outstanding:
5,687,517 at Mar. 31, 2006
5,685,024 at Mar. 31, 2005 $ 22,251 $ 22,260
Retained earnings 41,295 33,520
Other comprehensive income (loss) (1,878) (1,821)
Total shareholders' equity $ 61,668 $ 53,960
TOTAL LIABILITIES &
SHAREHOLDERS' EQUITY $ 639,945 $ 618,599
United Security Bancshares Three Three
Consolidated Statements of Income Months Months
(dollars in 000's, except per share amounts) Ended Ended
(unaudited) Mar 31, Mar 31,
2006 2005
---------- ----------
Interest income $ 10,552 $ 9,110
Interest expense 2,739 1,957
Net interest income 7,813 7,153
Provision for loan losses 240 251
Other income 3,207 1,323
Other expenses 4,548 4,016
Income before income tax provision 6,232 4,210
Provision for income taxes 2,368 1,545
NET INCOME $ 3,864 $ 2,664
United Security Bancshares Three Three
Selected Financial Data Months Months
(dollars in 000's except per share amounts) Ended Ended
03/31/2006 03/31/2005
---------- ----------
Basic Earnings Per Share $ 0.68 $ 0.47
Diluted Earning Per Share $ 0.67 $ 0.47
Annualized Return on:
Average Assets 2.47% 1.77%
Average Equity 25.75% 19.86%
Net Interest Margin 5.66% 5.37%
Net Charge-offs to Average Loans 0.01% 0.00%
03/31/2006 03/31/2005
---------- ----------
Book Value Per Share $ 10.84 $ 9.49
Tangible Book Value Per Share $ 10.24 $ 8.80
Efficiency Ratio 41.27% 47.37%
Non Performing Assets to Total Assets 2.02% 3.19%
Allowance for Loan Losses
to Total Loans 1.80% 1.79%
Shares Outstanding - period end 5,687,517 5,685,024
Basic Shares - average weighted 5,684,864 5,685,943
Diluted Shares - average weighted 5,751,192 5,721,946
SOURCE United Security Bancshares
-0- 04/11/2006
/CONTACT: Dennis R. Woods, President and CEO of United Security
Bancshares, +1-559-248-4928, or dwoods@unitedsecuritybank.com/
/Web site: http://www.unitedsecuritybank.com /