CORAL GABLES, Fla., April 24, 2008 (PRIME NEWSWIRE) -- Great Florida Bank (Nasdaq:GFLB) today reported net income for first quarter 2008 of $69 thousand, or $0.01 per basic and diluted share, compared to $574 thousand, or $0.04 per basic and diluted share, reported for first quarter 2007. This decline is mainly attributed to an increase in the provision for loan loss expense due to rising credit costs in the land and construction loan portfolios.
"At the end of 2007, the Bank's management team established four fundamental goals for 2008 to help us successfully weather the continuing economic uncertainty and market volatility. We committed to aggressively manage credit risk, decrease our cost of deposits, drive down operating costs and leverage our network of 22 Solution Centers," said Mehdi Ghomeshi, Great Florida Bank's Chairman and CEO. "Our performance this quarter was disappointing, however I am confident trends will turn more favorable as our team continues executing on these four goals."
First Quarter 2008 Highlights Compared to First Quarter 2007 -- Total assets grew to $1.9 billion, up 15%. -- Total loans grew to $1.3 billion, up 10% -- Total deposits grew to $1.0 billion, up 8% -- Shareholders' equity increased to $173.5 million, from $169.6 million. -- Book value per share increased to $13.23, from $12.94. -- Operating expenses were $9.4 million, down 10%.
As previously discussed, a fundamental goal for 2008 is reducing non-interest expense. The bank reported $9.4 million in non-interest expense for first quarter 2008, a 10% decrease compared to $10.5 million for first quarter 2007. The most significant decline occurred in non-recurring expenses for third party services, which, as previously reported, had been elevated during fiscal 2007 due to the requirements set forth in the FDIC Order relating to BSA.
Total net loans outstanding were $1.3 billion for first quarter 2008, a 10% increase compared to first quarter 2007. This increase reflects modest growth in residential real estate mortgages, home equity and construction loans. Total deposits grew to $1.0 billion, an 8% increase compared to first quarter 2007.
The Bank remains steadfastly committed to mitigating potential credit risk due to continued weakness in the general market, housing and real estate sectors. Delinquent loans totaled $16.3 million, or 1.25% of total loans outstanding, with the majority concentrated in land and construction loans at $9.1 million and loans secured by residential real estate at $3.9 million. In the preceding quarter, delinquent loans were $9.9 million or 0.77% of total loans outstanding, and $23.3 million, or 1.97% of total loans outstanding at the end of first quarter 2007. Loans classified as non-accrual totaled $29.0 million, or 1.57% of total assets at the end of first quarter 2008, compared to $21.5 million, or 1.19% of total assets at the end of the preceding quarter and $9.4 million, or 0.58% of total assets at the end of first quarter 2007.
The provision for loan loss expense was $2.0 million for first quarter 2008, up $400 thousand from the preceding quarter, and $1.6 million from a year-ago. The additions to the allowance for loan losses were attributable to the increase in outstanding loans from the year earlier period, plus additional reserves for the land and construction loan portfolios. At March 31, 2008, the allowance for loan losses was $23.5 million, or 1.80% of total loans outstanding. That compared to $21.8 million, or 1.71% of total loans outstanding in the preceding quarter, and $20.5 million, or 1.74% of total loans outstanding at March 31, 2007. Net loan charge offs were $272 thousand, or 0.02% of total loans outstanding, compared to $1.3 million, or 0.10% of total loans outstanding in the preceding quarter and $712 thousand, or 0.06% of total loans outstanding at the end of first quarter 2007.
Great Florida Bank maintained its strong capital position during the quarter and reported Tier 1 Capital of $170 million at March 31, 2008. The Bank's Tier 1 Leverage ratio was 10.73%, or 115% above the Federal regulatory definition of a 'Well Capitalized Bank'. The Bank also reported book value per share of $13.23, up from $12.94 for the same quarter last year.
ABOUT GREAT FLORIDA BANK
Established in June 2004, Great Florida Bank reported total assets of $1.9 billion on March 31, 2008. The corporate headquarters is located in Coral Gables, Florida and 22 Solution Centers are located throughout Miami-Dade and Broward Counties. The Bank is committed to providing ideas and solutions to its customers' financial needs by conveniently delivering personalized, state-of-the-art products and services in a relaxed environment. For further information, visit our website at www.greatfloridabank.com or call 866-514-6900.
Great Florida Bank Selected Financial Highlights (unaudited) March 31, 2008 (In Thousands except share/per share information) At and for the period ended March 31, Increase/ 2008 2007 (Decrease) ----------- ----------- ----------- Results of Operations: Interest Income on Loans 21,397 21,702 (305) Interest Income on Investment and Other Assets 3,955 1,301 2,654 ----------- ----------- Total Interest Income $ 25,352 $ 23,003 $ 2,349 Interest Expense on Deposits 9,762 10,620 (858) Interest Expense on Borrowings 4,413 1,348 3,065 ----------- ----------- Total Interest Expense $ 14,175 $ 11,968 $ 2,207 Net Interest Income before Provision 11,177 11,035 142 Provision for loan losses 2,005 400 1,605 ----------- ----------- Net Interest Income after Provision $ 9,172 $ 10,635 $ (1,463) Noninterest Income $ 499 $ 683 $ (184) Employee Compensation 5,279 5,498 (219) Occupancy Expense 2,005 2,048 (43) Professional and Consulting 430 1,028 (598) Other Expenses 1,722 1,907 (185) ----------- ----------- Noninterest Expense $ 9,436 $ 10,481 $ (1,045) Pretax Income 235 837 (602) Provision for income tax expense 166 263 (97) Net Income $ 69 $ 574 $ (505) Net earnings per common share - basic 0.01 0.04 (0.03) Net earnings per common share - diluted 0.01 0.04 (0.03) Period End Data: Total Assets $ 1,850,387 $ 1,606,956 $ 243,431 Total Securities 352,930 110,240 242,690 Land and Construction Loans 403,835 394,710 9,125 Commercial Real Estate Secured Loans 229,748 228,128 1,620 Commercial Loans 146,195 148,097 (1,902) Residential Real Estate Secured Loans 471,758 371,094 100,664 Non Accrual Loans 29,047 9,380 19,667 Loans before Allowance for Loan Losses 1,303,597 1,182,372 121,225 Allowance for loan losses 23,520 20,538 2,982 Loans, Net 1,280,077 1,161,834 118,243 Noninterest bearing demand deposits 82,491 90,944 (8,453) Interest bearing demand deposits 14,506 23,285 (8,779) Money Market, Savings and Time Deposits 841,647 790,237 51,410 Brokered Deposits 83,318 42,056 41,262 Total Deposits 1,021,962 946,522 75,440 Advances from FHLB 535,700 381,000 154,700 Other borrowings 112,312 101,966 10,346 Tangible equity 170,302 169,399 903 Shareholders' equity 173,490 169,639 3,851 Shares outstanding 13,112,500 13,112,500 -- Book value per share 13.23 12.94 0.29 Key Ratios: Return on average assets 0.02% 0.18% -0.16% Return on average equity 0.16% 1.35% -1.19% Net interest margin 2.89% 3.59% -0.70% Nonaccruing loans/total gross loans 2.23% 0.79% 1.44% Allowance for loan losses/period end loans 1.80% 1.74% 0.06% Shareholders' equity to period end total assets 9.38% 10.56% -1.18% Tangible Equity to period end total assets 9.20% 10.54% -1.34% Risk-based Capital Ratios: Minimum to be Over (Under) Actual 2008 Well Capitalized Requirement ----------- ---------------- ------------ Total Risk Based Capital (to risk weighted assets) $ 187,278 $ 134,753 $ 52,525 Tier 1 Capital (to risk weighted assets) $ 170,302 $ 80,852 $ 89,450 Tier 1 Capital (to average total assets) $ 170,302 $ 79,350 $ 90,952