MACON, Ga., Jan. 24, 2007 (PRIME NEWSWIRE) -- Security Bank Corporation (Nasdaq:SBKC) today announced earnings and earnings per share for the fourth quarter of 2006. All per share figures have been adjusted for the Company's two-for-one stock split on May 27, 2005.
Summary
-- Bond portfolio restructuring charge in the fourth quarter of
$1.3 million or $0.04 per diluted share after-tax
-- Nonperforming assets grew to $37.2 million during the fourth quarter
of 2006, but less than the previously estimated balance of $40 to $43
million
-- Diluted earnings per share of $0.26 for the fourth quarter of the
current year versus $0.33 in the same quarter of 2005
-- Diluted operating earnings per share of $0.31 for the fourth quarter
of the current year versus $0.33 in the same quarter of 2005
-- Fourth quarter loan growth of $110.1 million or approximately 25%
on an annualized basis
Earnings Summary
Net operating income for the fourth quarter of 2006 increased 38% to $6.0 million, compared to $4.4 million in the fourth quarter of 2005. Diluted operating earnings per share were $0.31 versus $0.33 for the same quarter in 2005, a decrease of 6.1%. The decrease in diluted operating earnings per share is primarily due to the recent deterioration in certain acquisition and development ("A&D") real estate loans, which is discussed further in the "Asset Quality" section below and in the Company's news release dated December 28, 2006. For the year ended December 31, 2006, net operating income was $24.2 million or $1.38 per diluted operating share, an increase of 50% and 8.7%, respectively, over the comparable period a year ago.
The Company's annualized returns on average tangible equity and average assets for the fourth quarter of 2006 were 12.19% and 0.87%, respectively, compared to 19.15% and 1.28%, respectively, for the fourth quarter of 2005. For the year ended December 31, 2006, the annualized returns on average tangible equity and average assets were 16.53% and 1.15%, respectively, versus 19.30% and 1.31% for the same period in 2005. Annualized returns on average assets and average tangible equity for the fourth quarter and year ended December 31, 2006, excluding the impact of securities losses were 1.10% and 15.30% and 1.23% and 17.68%, respectively. The Company's offering of 1,725,000 shares of common stock in May 2006 contributed to the decreases in returns on average tangible equity when compared to prior periods.
Rett Walker, Security Bank Corporation President and CEO, remarked, "We are aggressively pursuing collection efforts on nonperforming loans. Although we ended the year on less than a high note with the recognition of some nonperforming credits, we are very proud of a number of notable accomplishments in 2006, including successful mergers with Neighbors Bancshares, Inc. and Homestead Bank, an oversubscribed offering of 1,725,000 shares of the Company's common stock and operating earnings per share growth of approximately 9%, despite the dilutive effects of the offering. Given the strong loan growth across the Company we saw in the fourth quarter and are seeing so far in January of this year, we are optimistic about our prospects going into 2007."
Balance Sheet
Loans, excluding loans held for resale, were $1.90 billion at December 31, 2006, up from $1.27 billion at December 31, 2005, an increase of 49%. Excluding acquisitions, loans increased $277.3 million or 22% since December 31, 2005.
Total deposits were $1.97 billion at December 31, 2006, an increase of 53% from $1.29 billion at December 31, 2005. Excluding acquisitions, deposits increased $323.3 million or 25% since December 31, 2005. Total assets increased 50% to $2.50 billion at December 31, 2006, compared to $1.66 billion at December 31, 2005. Excluding acquisitions, total assets increased $367.9 million or 22%, compared to December 31, 2005.
Shareholders' equity increased $127.1 million to $306.4 million, an increase of 71% compared to December 31, 2005. The primary reasons for the increase were the acquisitions during the period, which contributed approximately $67.2 million of the increase, and the May 2006 stock offering, which contributed $35.9 million of the increase. The remaining increase of $24.0 million is primarily attributable to earnings, net of dividends paid.
Net Interest Income
Net interest income (on a fully tax-equivalent basis) for the fourth quarter of 2006 was $22.2 million, an increase of 58% when compared to the fourth quarter of 2005. The increase is primarily the result of the continued growth in the Company's loan portfolio, both from organic growth and growth from acquisitions. The net interest margin (on a fully tax-equivalent basis) was 4.14% for the quarter ended December 31, 2006, compared to 4.53% for the comparable period one year ago and 4.47% for the third quarter of 2006. The decrease in the net interest margin in the fourth quarter is partially the result of the increase in nonperforming assets (see "Asset Quality" section below) which reduced the margin for the fourth quarter by 14 basis points. For the year ended December 31, 2006, the net interest margin (on a fully tax-equivalent basis) was 4.40% compared to 4.46% for the year ended December 31, 2005.
Noninterest Income and Expense
Noninterest income for the fourth quarter of 2006 was $3.1 million versus $4.1 million for the fourth quarter of 2005, a decrease of 25%. The decrease is attributable to losses on the sale of securities of approximately $1.3 million. The decrease in noninterest income resulting from the losses on the sale of securities is offset by an increase in service charges of approximately $396,000.
Noninterest expense for the fourth quarter of 2006 was $14.7 million, an increase of 39% over the fourth quarter 2005 level of $10.6 million. The increase is primarily attributable to a $2.3 million increase in salaries and benefits, most of which is the direct result of the Company's significant growth from three acquisitions completed since the fourth quarter of 2005. The increase is also related to occupancy and equipment expenses, which increased approximately $423,000 due to the addition of properties in connection with acquisitions since the fourth quarter of 2005. Furthermore, the increase is related to increased costs with respect to marketing ($195,000), professional fees ($204,000) and amortization of core deposit intangibles ($164,000). The remainder of the increase is spread over various expense categories. Compared to the fourth quarter of 2005, the Company's efficiency ratio improved to 58.1% from 58.2%.
Asset Quality
As noted in the December 28, 2006 news release, as a result of guarantor issues the Company placed three A&D credit relationships on nonaccrual status totaling approximately $20 million during the fourth quarter. However, the Company received payments of $3.0 million on one of these credits prior to the end of the quarter. As a result, total nonperforming assets (nonaccrual, repossessed assets and other real estate owned) increased to 1.95% of total loans plus other real estate owned compared to 1.05% and 0.74% at the end of the third quarter of 2006 and the fourth quarter of 2005, respectively. In addition, the Company charged-off approximately $574,000 in specifically identified losses related to one of the aforementioned credit relationships during the fourth quarter. As a result, net charge-offs to average loans increased to 0.22% for the fourth quarter of 2006 from 0.12% in the fourth quarter of 2005. The allowance for loan losses was $22.3 million at December 31, 2006, up from $16.1 million at December 31, 2005. The increase in the allowance for loan losses is primarily attributable to growth in the Company's loan portfolio and the addition of $4.1 million of loss reserves in connection with the acquisitions of Neighbors Bancshares, Inc. and Homestead Bank during the period.
2007 Earnings Per Share Estimate
The Company today announced its diluted earnings per share estimate for 2007 in the range of $1.51 to $1.55, which represents an increase over 2006 operating earnings per diluted share of 9% to 12%, respectively
Other Information
Security Bank Corporation's management team will host a conference call to discuss these results at 8:30 AM EDT on Thursday, January 25, 2007. This call is open to all interested parties. From locations within the United States, the call-in number is 877-407-8035 (201-689-8035 from outside the United States). Please call in 10 minutes prior to the beginning of the conference call and ask for the Security Bank Corporation conference call.
A recorded playback of the conference call will be available by calling 877-660-6853, (201-612-7415 from outside the United States) from approximately 12:00 PM EDT, Thursday, January 25th, until 11:59 PM EDT Thursday, February 1, 2007. The reservation numbers for this playback are Account #286 and Conference ID # 226231.
This press release, including the attached selected unaudited financial tables, which are a part of this release, contains financial information determined by methods other than in accordance with generally accepted accounting principles ("GAAP"). These non-GAAP financial measures are "tangible book value" and "return on average tangible equity." Security Bank's management uses these non-GAAP measures in its analysis of Security Bank's performance. Tangible book value is defined as total equity reduced by recorded intangible assets, net of related deferred tax benefits. Tangible book value per share is defined as tangible book value divided by total common shares outstanding. This measure is important to many investors in the marketplace who are interested in changes from period to period in book value per share exclusive of changes in intangible assets. Goodwill, an intangible asset that is recorded in a purchase business combination, has the effect of increasing total book value while not increasing the tangible assets of the company. For companies such as Security Bank that have engaged in multiple business combinations, purchase accounting requires the recording of significant amounts of goodwill related to such transactions. Return on average tangible equity is defined as earnings for the period (annualized for the quarterly period or year-to-date period, as applicable) divided by average equity reduced by average goodwill and other intangible assets, net of related deferred tax benefits.
Security Bank's management includes this measure because it believes that it is important when measuring the Company's performance exclusive of the effects of goodwill and other intangibles recorded in recent acquisitions, and this measure is used by many investors as part of their analysis of Security Bank.
Further, Non-GAAP measures typically adjust GAAP performance measures to exclude the effects of significant gains, losses or expenses that are unusual in nature and not expected to recur. Other non-GAAP financial measures included in this release are referred to as "net operating income" and "operating earnings per diluted share," which exclude losses on the sale of investment securities and gains on the early prepayment of advances with the Federal Home Loan Bank. Since these items and their impact on the Company's performance are difficult to predict, management believes presentations of financial measures excluding the impact of these items provide useful supplemental information that is important for a proper understanding of the operating results of the Company's core business. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Please refer to the "Reconciliation Table" in the attached schedules for a more detailed analysis of these non-GAAP performance measures and the most directly comparable GAAP measures.
About Security Bank Corporation
Security Bank Corporation is a Georgia multi-bank holding company based in Macon, Bibb County, Georgia. Security Bank Corporation operates 6 community banks with banking offices located throughout middle Georgia, coastal Georgia and north metropolitan Atlanta. In addition, Security Bank Corporation operates a mortgage subsidiary, Fairfield Financial Services, Inc., with offices throughout Georgia.
Security Bank Corporation common stock is traded on the NASDAQ Global Select Market under the ticker symbol "SBKC."
Safe Harbor
This press release contains forward-looking statements as defined by federal securities laws. Statements contained in this press release that are not historical facts are forward looking statements. These statements may address issues involving significant risks, uncertainties, estimates and assumptions made by management. Actual results could differ materially from current projections and expectations for many reasons, including without limitation, changing events and trends that have influenced Security Bank Corporation's assumptions, but are beyond Security Bank Corporation's control. Forward-looking statements are necessarily estimates reflecting the best judgment of Security Bank Corporation senior management based upon current information and involve a number of risks and uncertainties. Please refer to Security Bank Corporation's public filings with the Securities and Exchange Commission for a summary of important factors that could affect Security Bank Corporation's financial results and operations and its forward-looking statements. Security Bank Corporation does not intend to and assumes no responsibility, except as required by law, for updating or revising any forward-looking statements contained in this press release, whether as a result of new information, future events or otherwise.
Security Bank Corporation
Selected Consolidated Financial Data
(Dollars in Thousands, except Per Share Amounts)
Unaudited
Quarters Ended Twelve Months Ended
December 31, December 31,
--------------------------- ----------------------
% %
2006 2005 Change 2006 2005 Change
---- ---- ------- ---- ---- -------
EARNINGS SUMMARY:
Net interest
income (FTE) $ 22,168 $ 14,077 57.5% $79,848 $50,677 57.6%
Provision for
Loan Losses 1,873 630 197.3% 4,468 2,833 57.7%
Noninterest
Income 3,086 4,097 -24.7% 17,906 16,603 7.8%
Noninterest
Expense 14,675 10,577 38.7% 55,602 38,628 43.9%
Provision for
Income Taxes 3,378 2,507 34.7% 13,878 9,310 49.1%
Net Income 5,222 4,379 19.3% 23,392 16,185 44.5%
PER COMMON SHARE:
Basic
earnings $ 0.26 $ 0.34 -23.5% $ 1.36 $ 1.31 3.8%
Diluted
earnings 0.26 0.33 -21.2% 1.33 1.27 4.7%
Diluted
operating
earnings (b) 0.31 0.33 -6.1% 1.38 1.27 8.7%
Cash dividends
declared 0.075 0.065 15.4% 0.30 0.26 15.4%
Book value 15.99 12.46 28.3% 15.99 12.46 28.3%
Tangible book
value 8.99 7.08 27.0% 8.99 7.08 27.0%
KEY PERFORMANCE
RATIOS (a):
Return on
average
tangible
equity (b) 12.19% 19.15% 16.53% 19.30%
Return on
average assets 0.87% 1.28% 1.15% 1.31%
Efficiency
ratio 58.11% 58.20% 56.88% 57.42%
Net interest
margin (FTE) 4.14% 4.53% 4.40% 4.46%
Net charge-offs
to average
loans 0.22% 0.12% 0.15% 0.12%
BALANCE SHEET
SUMMARY -
END OF PERIOD
Investment
securities $ 229,940 $ 150,986 52.3%
Loans Held for
Resale 8,878 5,562 59.6%
Loans, gross 1,901,101 1,272,119 49.4%
Allowance for
loan losses 22,336 16,148 38.3%
Total assets 2,497,080 1,662,413 50.2%
Deposits 1,970,927 1,291,253 52.6%
Other borrowed
money 175,605 172,141 2.0%
Shareholders'
equity 306,407 179,305 70.9%
ASSET QUALITY
- END OF PERIOD
Nonaccrual
loans $ 34,401 $ 6,997 391.7%
Loans 90 Days
Past Due and
Accruing -- -- 0.0%
Other real
estate owned 2,775 2,394 15.9%
Total nonper-
forming
assets 37,176 9,391 295.9%
Allowance for
loan losses/
NPAs 60.08% 171.95%
Allowance for
loan losses/
loans 1.18% 1.27%
(a) Annualized based on number of days in the period, except
efficiency ratio
(b) Calculation of this measure is illustrated in the attached
GAAP to non-GAAP reconciliation
Security Bank Corporation
Average Balance Sheet and Net Interest Income Analysis
(Dollars in Thousands)
Unaudited
Quarter Ended Twelve Months Ended
December 31, 2006 December 31, 2006
Average Income/ Yield/ Average Income/ Yield/
Balance Expense Rate Balance Expense Rate
--------- ------ ---- --------- ------- ----
ASSETS
Earning assets:
Interest-bearing
deposits and fed
funds sold $ 35,813 $ 467 5.17% $ 34,518 $ 1,757 5.09%
Investment
securities 216,433 2,649 4.86% 173,665 8,196 4.72%
Loans Held for
Resale 6,064 102 6.67% 6,576 454 6.90%
Loans 1,864,427 41,279 8.78% 1,599,508 137,993 8.63%
Other earning
assets 1,238 24 7.69% 1,238 95 7.67%
Total earning
assets 2,123,975 44,521 8.32% 1,815,505 148,495 8.18%
Non-earning assets 244,667 213,401
--------- ---------
Total assets $2,368,642 $2,028,906
========== ==========
LIABILITIES AND
SHAREHOLDERS' EQUITY
Interest-bearing
liabilities:
Savings and
interest-bearing
transaction $ 521,440 $4,686 3.57% $ 457,348 $14,702 3.21%
Time deposits 1,195,781 15,396 5.11% 995,700 46,037 4.62%
Other borrowings 153,450 2,271 5.87% 138,871 7,908 5.69%
Total interest-
bearing
liabilities 1,870,671 22,353 4.74% 1,591,919 68,647 4.31%
Noninterest-bearing
liabilities:
Noninterest-
bearing deposits 169,410 166,190
Other noninterest-
bearing
liabilities 24,199 18,793
Total
liabilities $2,064,280 $1,776,902
---------- ----------
Shareholders'
Equity 304,362 252,004
---------- ----------
Total liabilities
and shareholders'
equity $2,368,642 $2,028,906
========== ==========
Interest rate
spread 3.58% 3.87%
Net interest
income $22,168 $79,848
Net interest
margin (FTE) 4.14% 4.40%
Security Bank Corporation (SBKC)
Selected Financial Information
(Amounts in thousands, except per share data)
2006
----------------------------------------------------------
Dec. 31/YTD 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
----------------------------------------------------------
Period-End
Balance Sheet
-------------
Total
Assets $2,497,080 $2,497,080 $2,314,913 $1,974,376 $1,912,841
Total
Securities 229,940 229,940 211,005 163,378 146,932
Mortgage
Loans held
for Sale 8,878 8,878 8,947 12,201 7,776
Loans:
Commercial:
Real-Estate 916,919 916,919 884,417 705,072 699,215
Con-
struction 602,712 602,712 553,296 460,131 430,585
All Other 152,289 152,289 125,468 115,968 103,396
Residential:
Consumer
Real-
Estate 150,398 150,398 151,559 151,633 155,031
Consumer
Construc-
tion 30,262 30,262 30,332 32,057 30,376
All Other
Consumer 48,521 48,521 45,892 36,102 51,089
Total
Loans 1,901,101 1,901,101 1,790,964 1,500,963 1,469,692
Allowance for
loan losses 22,336 22,336 21,477 18,190 17,812
Other Assets:
Other
earning
assets: 97,808 97,808 49,612 82,265 78,567
Total
Earning
Assets: 2,237,727 2,237,727 2,060,528 1,758,807 1,702,967
Intangibles:
Goodwill 130,993 130,993 131,162 103,014 102,659
Core-Deposit 5,110 5,110 5,356 4,907 5,129
Deposits:
Demand
Deposits 178,967 178,967 173,129 172,023 168,235
Interest
bearing
deposits 1,791,960 1,791,960 1,659,876 1,403,986 1,362,149
Total
Deposits 1,970,927 1,970,927 1,833,005 1,576,009 1,530,384
Fed Funds
purchased
& repo
agreements 50,917 50,917 35,819 20,030 18,271
Other
borrowed
funds 124,688 124,688 123,988 112,465 125,665
Common
Equity 306,407 306,407 302,273 257,780 217,641
=====================================================================
Average
Balance Sheet
-------------
Total
Assets $2,028,906 $2,368,642 $2,157,297 $1,906,800 $1,673,006
Total
Securities 173,665 216,433 183,291 151,542 142,473
Mortgage
Loans held
for Sale 6,576 6,064 7,015 8,011 5,200
Total Loans 1,599,508 1,864,427 1,697,108 1,494,812 1,334,789
Other
earning
assets: 35,756 37,051 39,313 45,829 20,624
Total
Earning
Assets: 1,815,505 2,123,975 1,926,727 1,700,194 1,503,086
Deposits:
Demand
Deposits 166,190 169,410 172,393 166,941 155,181
Interest
bearing
deposits
Savings 19,268 17,085 18,645 20,359 21,036
NOW 310,624 358,114 335,152 307,630 240,033
Money
Market 127,456 146,241 132,302 103,540 127,480
Time
deposits gt.
$100,000 571,992 688,977 608,483 542,530 445,970
Time
deposits lt.
$100,000 423,708 506,804 471,973 386,389 325,379
Total
Deposits 1,619,238 1,886,631 1,738,948 1,527,389 1,315,079
Fed Funds
purchased
& repo
agreements 29,874 45,112 26,036 23,230 24,608
Other
borrowed
funds 108,997 108,338 89,927 102,493 136,740
Common
Equity 252,004 304,362 283,937 235,731 182,219
=====================================================================
Income Statement
----------------
Interest
Income $ 148,081 $ 44,415 $ 40,669 $ 34,214 $ 28,783
Interest
Expense 68,647 22,353 19,082 15,142 12,070
Net Interest
Income 79,434 22,062 21,587 19,072 16,713
Loan loss
provision 4,468 1,873 1,226 739 630
Service
charges on
deposit
accounts 9,162 2,336 2,387 2,335 2,104
Mortgage
banking
revenues 4,922 1,007 1,231 1,433 1,251
Securities
Gains
(Losses) (1,601) (1,331) (270) -- --
Other income 5,423 1,074 1,638 1,149 1,562
Total non-
interest
income 17,906 3,086 4,986 4,917 4,917
Salaries and
benefits 32,376 8,313 8,497 7,804 7,762
Occupancy and
equipment 5,622 1,471 1,396 1,459 1,296
Other non-
interest
expense 17,604 4,891 4,539 4,351 3,823
Total non-
interest
expense 55,602 14,675 14,432 13,614 12,881
Pre-tax
earnings 37,270 8,600 10,915 9,636 8,119
Income Taxes 13,878 3,378 3,975 3,546 2,979
Net income $ 23,392 $ 5,222 $ 6,940 $ 6,090 $ 5,140
Basic
earnings per
share(c) $ 1.36 $ 0.26 $ 0.38 $ 0.36 $ 0.36
Diluted
earnings per
share(c) 1.33 0.26 0.37 0.36 0.35
Operating
diluted
earnings per
share (c),(d) 1.38 0.31 0.37 0.36 0.35
End of
period shares
outstand-
ing(c) 19,166,314 19,166,314 19,161,507 17,519,112 15,782,125
Weighted
average
diluted
shares
o/s (c) 17,564,990 19,528,891 18,971,126 16,910,380 14,784,856
Tax equi-
valent ad-
justment 414 106 107 100 101
Net interest
income (FTE) 79,848 22,168 21,694 19,172 16,814
Effective
Tax Rate 37.24% 39.28% 36.42% 36.80% 36.69%
=====================================================================
Stock and related
per share data:(c)
------------------
Book value $ 15.99 $ 15.99 $ 15.78 $ 14.71 $ 13.79
Tangible
book value 8.99 8.99 8.76 8.66 7.08
Dividends
declared per
share 0.30 0.075 0.075 0.075 0.075
=====================================================================
Other Key
Ratios/Data:
------------
Return on
average
tangible
equity(b),(d) 16.53% 12.19% 17.13% 18.81% 19.92%
Return on
average
assets(b) 1.15% 0.87% 1.28% 1.28% 1.25%
Net interest
margin
(FTE)(b) 4.40% 4.14% 4.47% 4.52% 4.54%
Efficiency
ratio (FTE) 56.88% 58.11% 54.09% 56.51% 59.27%
Tangible
Equity/
Tangible
Assets(d) 7.29% 7.29% 7.70% 8.12% 6.19%
=====================================================================
Loan Performance
Data:
----------------
Nonaccrual
loans $ 34,401 $ 34,401 $ 16,946 $ 17,269 $ 8,171
Loans 90
Days Past
Due and
Accruing -- -- -- -- --
Other real
estate
owned (ORE) 2,775 2,775 1,867 1,817 2,488
Total non-
performing
assets 37,176 37,176 18,813 19,086 10,659
Net charge-
offs 2,362 1,014 789 361 198
Allowance
for loan
losses/NPAs 60.08% 60.08% 114.16% 95.31% 167.11%
Allowance for
loan losses/
loans 1.18% 1.18% 1.20% 1.21% 1.21%
NPAs/Loans
plus ORE 1.95% 1.95% 1.05% 1.27% 0.72%
Nonperforming
assets/total
assets 1.49% 1.49% 0.81% 0.97% 0.56%
Net charge-
offs to
average
loans(a) 0.15% 0.22% 0.18% 0.10% 0.06%
=====================================================================
----------------------------------------------------------
2005
----------------------------------------------------------
Dec. 31/YTD 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
----------------------------------------------------------
Period-End
Balance Sheet
-------------
Total
Assets $1,662,413 $1,662,413 $1,345,566 $1,329,629 $1,116,123
Total
Securities 150,986 150,986 121,374 122,763 112,703
Mortgage
Loans held
for Sale 5,562 5,562 9,372 7,413 6,384
Loans:
Commercial:
Real-
Estate 609,010 609,010 418,020 423,720 412,779
Construc-
tion 334,114 334,114 316,701 309,270 232,629
All Other 95,688 95,688 137,879 126,290 69,983
Residential:
Consumer
Real-
Estate 163,874 163,874 118,679 116,119 115,168
Consumer
Construc-
tion 19,750 19,750 19,371 20,041 17,835
All Other
Consumer 49,683 49,683 53,420 46,285 42,097
Total
Loans 1,272,119 1,272,119 1,064,070 1,041,725 890,491
Allowance
for loan
losses 16,148 16,148 13,628 13,264 11,357
Other Assets:
Other
earning
assets: 41,330 41,330 23,928 45,141 18,846
Total
Earning
Assets: 1,469,997 1,469,997 1,218,744 1,217,042 1,028,424
Intangibles:
Goodwill 74,582 74,582 49,677 50,507 31,852
Core-Deposit 4,687 4,687 1,498 1,580 542
Deposits:
Demand
Deposits 156,698 156,698 137,295 121,600 115,241
Interest
bearing
deposits 1,134,555 1,134,555 949,084 952,487 791,833
Total
Deposits 1,291,253 1,291,253 1,086,379 1,074,087 907,074
Fed Funds
purchased
& repo
agreements 43,876 43,876 10,052 5,714 12,469
Other
borrowed
funds 128,265 128,265 100,207 94,007 77,707
Common Equity 179,305 179,305 140,408 137,019 110,968
=====================================================================
Average Balance
Sheet
---------------
Total
Assets $1,238,033 $1,353,208 $1,326,590 $1,184,441 $1,082,503
Total
Securities 116,110 117,857 123,002 115,694 107,674
Mortgage
Loans held
for Sale 6,726 6,754 8,769 6,132 5,167
Total Loans 997,526 1,091,643 1,064,766 956,933 874,078
Other earning
assets: 16,840 17,800 17,327 18,467 13,729
Total
Earning
Assets: 1,137,202 1,234,054 1,213,864 1,097,226 1,000,648
Deposits:
Demand
Deposits 119,867 131,616 122,600 116,899 108,057
Interest
bearing
deposits
Savings 19,969 18,648 19,646 20,821 20,782
NOW 158,264 198,465 175,373 141,396 116,830
Money
Market 80,640 78,800 83,961 81,233 78,542
Time
deposits gt.
$100,000 317,143 355,908 349,889 304,208 257,372
Time
deposits lt.
$100,000 305,609 312,576 324,000 298,644 286,742
Total
Deposits 1,001,492 1,096,013 1,075,469 963,201 868,325
Fed Funds
purchased
& repo
agreements 16,295 19,704 12,224 15,899 17,256
Other
borrowed
funds 83,754 86,260 89,601 76,511 82,205
Common
Equity 126,461 141,576 138,246 118,365 107,792
=====================================================================
Income Statement
----------------
Interest
Income $ 78,192 $ 22,860 $ 21,444 $ 18,023 $ 15,865
Interest
Expense 27,839 8,864 7,976 6,162 4,837
Net Interest
Income 50,353 13,996 13,468 11,861 11,028
Loan loss
provision 2,833 630 624 804 775
Service
charges on
deposit
accounts 7,351 1,940 1,956 1,858 1,597
Mortgage
banking
revenues 4,539 1,040 1,333 1,207 959
Securities
Gains
(Losses) (6) - - - (6)
Other income 4,719 1,117 1,121 1,517 964
Total non-
interest
income 16,603 4,097 4,410 4,582 3,514
Salaries and
benefits 22,811 6,044 6,115 5,598 5,054
Occupancy and
equipment 3,785 1,048 985 906 846
Other non-
interest
expense 12,032 3,485 3,156 2,828 2,563
Total non-
interest
expense 38,628 10,577 10,256 9,332 8,463
Pre-tax
earnings 25,495 6,886 6,998 6,307 5,304
Income Taxes 9,310 2,507 2,509 2,397 1,897
Net income $ 16,185 $ 4,379 $ 4,489 $ 3,910 $ 3,407
Basic
earnings per
share(c) $ 1.31 $ 0.34 $ 0.36 $ 0.32 $ 0.29
Diluted
earnings per
share(c) 1.27 0.33 0.33 0.32 0.29
Operating
diluted
earnings per
share(c),(d) 1.27 0.33 0.33 0.32 0.29
End of period
shares
outstand-
ing(c) 14,386,960 14,386,960 12,911,550 12,851,640 11,755,982
Weighted
average
diluted
shares
o/s(c) 12,736,544 13,316,163 13,218,030 12,374,075 11,970,224
Tax
equivalent
adjustment 324 81 79 82 82
Net interest
income (FTE) 50,677 14,077 13,547 11,943 11,110
Effective
Tax Rate 36.52% 36.41% 35.85% 38.00% 35.77%
=====================================================================
Stock and related
per share data:(c)
------------------
Book value $ 12.46 $ 12.46 $ 10.87 $ 10.66 $ 9.44
Tangible
book value 7.08 7.08 6.94 6.65 6.69
Dividends
declared
per share 0.26 0.065 0.065 0.065 0.065
=====================================================================
Other Key
Ratios/Data:
-------------
Return on
average
tangible
equity(b),(d) 19.30% 19.15% 20.46% 19.64% 17.64%
Return on
average
assets(b) 1.31% 1.28% 1.34% 1.32% 1.28%
Net interest
margin
(FTE)(b) 4.46% 4.53% 4.43% 4.37% 4.50%
Efficiency
ratio (FTE) 57.42% 58.20% 57.11% 56.47% 57.87%
Tangible
Equity/
Tangible
Assets(d) 6.42% 6.42% 6.93% 6.69% 7.27%
=====================================================================
Loan Performance
Data:
----------------
Nonaccrual
loans $ 6,997 $ 6,997 $ 5,746 $ 5,200 $ 5,761
Loans 90
Days Past
Due and
Accruing -- -- -- 59 --
Other real
estate
owned (ORE) 2,394 2,394 1,722 1,467 938
Total non-
performing
assets 9,391 9,391 7,468 6,726 6,699
Net charge-
offs 1,219 321 260 317 321
Allowance for
loan losses/
NPAs 171.95% 171.95% 182.49% 197.20% 169.53%
Allowance for
loan losses/
loans 1.27% 1.27% 1.28% 1.27% 1.28%
NPAs/Loans
plus ORE 0.74% 0.74% 0.70% 0.64% 0.75%
Nonperforming
assets/total
assets 0.56% 0.56% 0.56% 0.51% 0.60%
Net charge-offs
to average
loans(a) 0.12% 0.12% 0.10% 0.13% 0.15%
=====================================================================
------------------------
2004
------------------------
Dec. 31/YTD 4th Quarter
------------------------
Period-End Balance Sheet
------------------------
Total Assets $1,063,485 $1,063,485
Total Securities 111,412 111,412
Mortgage Loans held for Sale 7,507 7,507
Loans:
Commercial:
Real-Estate 406,654 406,654
Construction 192,181 192,181
All Other 71,081 71,081
Residential:
Consumer Real-Estate 115,470 115,470
Consumer Construction 18,953 18,953
All Other Consumer 41,426 41,426
Total Loans 845,765 845,765
Allowance for loan losses 10,903 10,903
Other Assets:
Other earning assets: 20,898 20,898
Total Earning Assets: 985,582 985,582
Intangibles:
Goodwill 28,579 28,579
Core-Deposit 585 585
Deposits:
Demand Deposits 119,545 119,545
Interest bearing deposits 723,013 723,013
Total Deposits 842,558 842,558
Fed Funds purchased
& repo agreements 21,811 21,811
Other borrowed funds 85,693 85,693
Common Equity 106,671 106,671
=====================================================================
Average Balance Sheet
---------------------
Total Assets $ 972,091 $1,027,551
Total Securities 103,896 113,085
Mortgage Loans held for Sale 6,955 6,455
Total Loans 775,274 820,778
Other earning assets: 10,457 9,061
Total Earning Assets: 896,582 949,379
Deposits:
Demand Deposits 105,695 111,249
Interest bearing deposits
Savings 19,299 19,620
NOW 81,385 93,356
Money Market 85,886 80,011
Time deposits gt. $100,000 195,271 223,083
Time deposits lt. $100,000 293,068 289,686
Total Deposits 780,604 817,005
Fed Funds purchased
& repo agreements 10,871 13,423
Other borrowed funds 80,024 84,631
Common Equity 94,453 105,184
=====================================================================
Income Statement
----------------
Interest Income $ 53,926 $ 14,717
Interest Expense 14,373 4,135
Net Interest Income 39,553 10,582
Loan loss provision 2,819 852
Service charges on deposit accounts 6,450 1,704
Mortgage banking revenues 4,931 1,019
Securities Gains (Losses) 3 3
Other income 3,449 1,423
Total noninterest income 14,833 4,149
Salaries and benefits 18,629 4,916
Occupancy and equipment 3,365 851
Other noninterest expense 10,314 2,844
Total noninterest expense 32,308 8,611
Pre-tax earnings 19,259 5,268
Income Taxes 6,940 1,851
Net income $ 12,319 $ 3,417
Basic earnings per share (c) $ 1.10 $ 0.29
Diluted earnings per share (c) 1.07 0.29
Operating diluted earnings per share (c), (d) 1.07 0.29
End of period shares outstanding (c) 11,639,810 11,639,810
Weighted average diluted shares o/s (c) 11,482,830 11,922,292
Tax equivalent adjustment 359 89
Net interest income (FTE) 39,912 10,671
Effective Tax Rate 36.04% 35.14%
=====================================================================
Stock and related per share data: (c)
------------------------------------
Book value $ 9.16 $ 9.16
Tangible book value 6.68 6.68
Dividends declared per share 0.22 0.055
=====================================================================
Other Key Ratios/Data:
---------------------
Return on average tangible equity (b), (d) 18.76% 17.90%
Return on average assets (b) 1.27% 1.32%
Net interest margin (FTE) (b) 4.45% 4.47%
Efficiency ratio (FTE) 59.02% 58.10%
Tangible Equity/Tangible Assets (d) 7.51% 7.51%
=====================================================================
Loan Performance Data:
---------------------
Nonaccrual loans $ 6,214 $ 6,214
Loans 90 Days Past Due and Accruing -- --
Other real estate owned (ORE) 1,991 1,991
Total nonperforming assets 8,205 8,205
Net charge-offs 1,323 414
Allowance for loan losses/NPAs 132.88% 132.88%
Allowance for loan losses/loans 1.29% 1.29%
NPAs/Loans plus ORE 0.97% 0.97%
Nonperforming assets/total assets 0.77% 0.77%
Net charge-offs to average loans (a) 0.17% 0.20%
=====================================================================
gt. = greater than
lt. = less than
(a) Annualized
(b) The actual number of days in the period were used to annualize
income
(c) Adjusted for 2-for-1 stock split effective May 27, 2005
(d) Calculation of this measure is illustrated in the attached
GAAP to non-GAAP reconciliation
2006
---------------------------------------------------------------------
Dec 31/YTD 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter
---------------------------------------------------------------------
Reconciliation
Table-
GAAP to non-GAAP:
------------------
Book Value
per share $15.99 $15.99 $15.78 $14.71 $13.79
Effect of
intangible
assets
per share (7.00) (7.00) (7.02) (6.05) (6.71)
Tangible
book value $8.99 $8.99 $8.76 $8.66 $7.08
Equity $306,407 $306,407 $302,273 $257,780 $217,641
Intangible
assets 136,103 136,103 136,518 107,921 107,788
Less tax
effect of
Core-Deposit
Intangible
(38%) (1,942) (1,942) (2,035) (1,865) (1,949)
Tangible
equity $ 172,246 $ 172,246 $ 167,790 $ 151,724 $ 111,802
Assets $2,497,080 $2,497,080 $2,314,913 $1,974,376 $1,912,841
Intangible
assets 134,161 134,161 134,483 106,056 105,839
Tangible
assets $2,362,919 $2,362,919 $2,180,430 $1,868,320 $1,807,002
Equity/
Assets 12.27% 12.27% 13.06% 13.06% 11.38%
Effect of
intangible
assets -4.98% -4.98% -5.36% -4.94% -5.19%
Tangible
Equity/
Tangible
Assets 7.29% 7.29% 7.70% 8.12% 6.19%
Average
Equity $252,004 $304,362 $283,937 $235,731 $182,219
Average
Intangible
assets 112,385 136,443 125,227 107,763 79,313
Less tax
effect of
Core-Deposit
Intangible
(38%) (1,921) (2,001) (2,006) (1,918) (1,754)
Average
tangible
equity $ 141,540 $ 169,920 $ 160,716 $ 129,886 $ 104,660
Net
Income (a) $23,392 $20,718 $27,534 $24,427 $20,846
Return on
average
tangible
equity 16.53% 12.19% 17.13% 18.81% 19.92%
Diluted
earnings
per share $1.33 $0.26 $0.37 $0.36 $0.35
Effect of
securities
losses,
net of tax 0.06 0.05 0.01 -- --
Effect of
prepayment
of FHLB
advances,
net of tax
(0.01) -- (0.01) -- --
Diluted
operating
earnings
per share $1.38 $0.31 $0.37 $0.36 $0.35
Net income $23,392 $5,222 $6,940 $6,090 $5,140
Effect of
securities
losses,
net of tax 980 808 172 -- --
Effect of
prepayment
of FHLB
advances,
net of tax (174) -- (174) -- --
Net operating
income $24,198 $6,030 $6,938 $6,090 $5,140
2005
--------------------------------------------------------------------
Dec 31/YTD 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter
--------------------------------------------------------------------
Reconciliation
Table-
GAAP to non-GAAP:
------------------
Book Value
per share $ 12.46 $ 12.46 $ 10.87 $ 10.66 $ 9.44
Effect of
intangible
assets
per share (5.38) (5.38) (3.93) (4.01) (2.75)
Tangible
book value $ 7.08 $ 7.08 $ 6.94 $ 6.65 $ 6.69
Equity $ 179,305 $ 179,305 $ 140,408 $ 137,019 $ 110,968
Intangible
assets 79,269 79,269 51,175 52,087 32,394
Less tax
effect of
Core-Deposit
Intangible
(38%) (1,781) (1,781) (569) (600) (206)
Tangible
equity $ 101,817 $ 101,817 $ 89,802 $ 85,532 $ 78,780
Assets $1,662,413 $1,662,413 $1,345,566 $1,329,629 $1,116,123
Intangible
assets 77,488 77,488 50,606 51,487 32,188
Tangible
assets $1,584,925 $1,584,925 $1,294,960 $1,278,142 $1,083,935
Equity/
Assets 10.79% 10.79% 10.43% 10.31% 9.94%
Effect of
intangible
assets -4.36% -4.36% -3.50% -3.61% -2.67%
Tangible
Equity/
Tangible
Assets 6.42% 6.42% 6.93% 6.69% 7.27%
Average
Equity $126,461 $141,576 $138,246 $118,365 $107,792
Average
Intangible
assets 43,025 51,446 51,782 38,851 29,649
Less tax
effect of
Core-Deposit
Intangible
(38%) (429) (571) (587) (337) (206)
Average
tangible
equity $ 83,865 $ 90,701 $87,051 $79,851 $78,349
Net
Income (a) $ 16,185 $ 17,373 $ 17,810 $ 15,685 $ 13,817
Return on
average
tangible
equity 19.30% 19.15% 20.46% 19.64% 17.64%
Diluted
earnings
per share $ 1.27 $ 0.33 $ 0.33 $ 0.32 $ 0.29
Effect of
securities
losses,
net of tax -- -- -- -- --
Effect of
prepayment
of FHLB
advances,
net of tax -- -- -- -- --
Diluted
operating
earnings
per share $ 1.27 $ 0.33 $ 0.33 $ 0.32 $ 0.29
Net income $ 16,185 $ 4,379 $ 4,489 $ 3,910 $ 3,407
Effect of
securities
losses, net
of tax 4 -- -- -- 4
Effect of
prepayment
of FHLB
advances,
net of tax -- -- -- -- --
Net operating
income $ 16,189 $ 4,379 $ 4,489 $ 3,910 $ 3,411
2004
------------------------
Dec 31/YTD 4th Quarter
------------------------
Reconciliation
Table-
GAAP to non-GAAP:
------------------
Book Value
per share $ 9.16 $ 9.16
Effect of
intangible
assets
per share (2.48) (2.48)
Tangible
book value $ 6.68 $ 6.68
Equity $ 106,671 $ 106,671
Intangible 29,164 29,164
assets
Less tax
effect of
Core-Deposit
Intangible
(38%) (222) (222)
Tangible
equity $ 77,729 $ 77,729
Assets $1,063,485 $1,063,485
Intangible
assets 28,942 28,942
Tangible
assets $1,034,543 $1,034,543
Equity/
Assets 10.03% 10.03%
Effect of
intangible
assets -2.52% -2.52%
Tangible
Equity/
Tangible
Assets 7.51% 7.51%
Average
Equity $ 94,453 $105,184
Average
Intangible
assets 29,295 29,660
Less tax
effect of
Core-Deposit
Intangible
(38%) (505) (411)
Average
tangible
equity $ 65,663 $ 75,935
Net
Income (a) $ 12,319 $ 13,594
Return on
average
tangible
equity 18.76% 17.90%
Diluted
earnings
per share $ 1.07 $ 0.29
Effect of
securities
losses,
net of tax - -
Effect of
prepayment
of FHLB
advances,
net of tax - -
Diluted
operating
earnings
per share $ 1.07 $ 0.29
Net income $ 12,319 $ 3,417
Effect of
securities
losses, net
of tax (2) (2)
Effect of
prepayment
of FHLB
advances,
net of tax - -
Net operating
income $ 12,317 $ 3,415
(a) The actual number of days in the period
were used to annualize income