KEENE, N.H., Jan. 22, 2003 (PRIMEZONE) -- Granite State Bankshares, Inc. (Nasdaq:GSBI) today announced net earnings for the three and twelve months ended December 31, 2002 of $1,875,000 and $12,379,000 compared to net earnings of $3,138,000 and $11,389,000 for the three and twelve months ended December 31, 2001. Basic earnings per share were $.36 and $2.41 for the three and twelve months ended December 31, 2002 compared to $.60 and $2.16 for the three and twelve months ended December 31, 2001. Diluted earnings per share were $.35 and $2.32 for the three and twelve months ended December 31, 2002 compared to $.59 and $2.11 for the three and twelve months ended December 31, 2001.
On November 7, 2002, Granite State Bankshares, Inc. (the "Company") entered into a definitive merger agreement whereby Chittenden Corporation will acquire the Company and its subsidiary, Granite Bank. Net earnings for the three and twelve months ended December 31, 2002 excluding the after tax impact of merger-related charges of $1,895,000 were $3,770,000 and $14,274,000, respectively. Basic earnings per share for the three and twelve months ended December 31, 2002 excluding the after tax impact of merger-related charges were $.73 and $2.78. Diluted earnings per share for the three and twelve months ended December 31, 2002 excluding the after tax impact of merger-related charges were $.70 and $2.68.
Net interest and dividend income for the three and twelve months ended December 31, 2002 was $9,908,000 and $39,694,000 compared with $9,995,000 and $37,010,000 for the three and twelve months ended December 31, 2001. The net interest margin for the three and twelve months ended December 31, 2002 was 3.78% and 3.93% compared with 4.10% and 3.98% for the three and twelve months ended December 31, 2001.
The provision for possible loan losses for the three and twelve months ended December 31, 2002 was $0 and $325,000 compared with $300,000 and $660,000 for the three and twelve months ended December 31, 2001.
Gains on sales of loans in the secondary mortgage market for the three and twelve months ended December 31, 2002 were $1,510,000 and $3,597,000 compared with $803,000 and $1,722,000 for the three and twelve months ended December 31, 2001. The large increase in 2002 relates to the continued lower interest rate environment, which encouraged residential borrowers to refinance into fixed rate loan products which the Company primarily sells in the secondary mortgage market.
As a result of the lower interest rate environment during the third and fourth quarters of 2002, refinance activity and therefore prepayments on residential mortgage loans increased substantially. As a result of increases in prepayment speeds, the Bank recorded provisions for a valuation allowance of $180,000 and $555,000 related to impairment on its mortgage servicing assets during the three and twelve months ended December 31, 2002, respectively.
Total assets at December 31, 2002 were $1,110,341,000 compared to $1,018,942,000 at December 31, 2001.
Total nonperforming loans and nonperforming assets were $1,310,000 or 0.12% of total assets at December 31, 2002. At December 31, 2001, total nonperforming loans and nonperforming assets were $3,015,000 or 0.30% of total assets.
Stockholders' equity at December 31, 2002 and December 31, 2001 was $90,993,000 and $80,537,000, respectively, representing 8.20% and 7.90% of total assets, respectively.
Chairman and CEO Charles W. Smith said, "We are pleased to report solid earnings and a significant increase in net earnings and earnings per share, as adjusted for the after tax impact of merger-related charges for the three and twelve months ended December 31, 2002 over the same periods in 2001."
Forward-looking Statements
Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those related to the economic environment, particularly in the market areas in which the company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity.
The Company wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company wishes to advise readers that the factors listed above could affect the Company's financial performance and could cause the Company's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Company does not undertake and specifically declines any obligation to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
Granite State Bankshares, Inc. is the parent company for Granite Bank, a New Hampshire state-chartered commercial bank with 19 offices operating throughout southern New Hampshire.
GRANITE STATE BANKSHARES, INC. and SUBSIDIARY
Selected Balance Sheet Data
($ in thousands, except per share data)
December 31, December 31,
2002 2001
------------ ------------
(unaudited)
Total assets $ 1,110,341 $ 1,018,942
Securities held to maturity 5,005 5,006
Securities available for sale 396,970 274,201
Stock in Federal Home Loan Bank
of Boston 8,271 7,201
Loans held for sale 19,611 14,821
Loans 610,127 655,000
Unearned income 851 1,075
Allowance for possible loan losses 7,968 8,085
Net loans 601,308 645,840
Total nonperforming loans and
nonperforming assets 1,310 3,015
Nonperforming assets as a percent
of total assets 0.12% 0.30%
Allowance for possible loan losses
as a percent of nonperforming loans 608.24% 268.16%
Total deposits $ 760,664 $ 714,143
Securities sold under agreements
to repurchase 89,883 85,013
Other borrowings 163,838 135,464
Stockholders' equity 90,993 80,537
Book value per share 17.40 15.38
GRANITE STATE BANKSHARES, INC. and SUBSIDIARY
Selected Operating Statement and Other Data
($ in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2002 2001 2002 2001
------ ------ ------ ------
(unaudited) (unaudited)
Interest and dividend
income $15,596 $ 16,942 $63,606 $68,922
Interest expense 5,688 6,947 23,912 31,912
------ ------ ------ ------
Net interest and
dividend income 9,908 9,995 39,694 37,010
Provision for possible
loan losses 0 300 325 660
------ ------ ------ ------
Net interest and
dividend income after
provision for possible
loan losses 9,908 9,695 39,369 36,350
Net gains (losses) on
securities available
for sale 286 (54) 834 403
Net gains on sales of
loans 1,510 803 3,597 1,722
Other noninterest
income 2,016 1,476 7,916 5,367
Merger-related charges 2,789 0 2,789 0
Other noninterest
expenses 7,762 6,795 28,703 25,680
------ ------ ------ ------
Earnings before income
taxes 3,169 5,125 20,224 18,162
Income taxes 1,294 1,987 7,845 6,773
------ ------ ------ ------
Net earnings $ 1,875 $ 3,138 $12,379 $11,389
====== ====== ====== ======
Adjusted net
earnings (a) $ 3,770 $ 3,138 $14,274 $11,389
====== ====== ====== ======
Weighted average shares
outstanding
Basic 5,155,229 5,189,767 5,142,851 5,264,873
Diluted 5,359,069 5,310,393 5,335,712 5,389,746
Net earnings per
share-basic $ 0.36 $ 0.60 $ 2.41 $ 2.16
===== ===== ===== =====
Net earnings per
share-diluted $ 0.35 $ 0.59 $ 2.32 $ 2.11
===== ===== ===== =====
Adjusted net earnings
per share-basic (a) $ 0.73 $ 0.60 $ 2.78 $ 2.16
===== ===== ===== =====
Adjusted net earnings
per share -diluted (a) $ 0.70 $ 0.59 $ 2.68 $ 2.11
===== ===== ===== =====
Dividends declared per
share $ 0.19 $ 0.17 $ 0.76 $ 0.68
===== ===== ===== =====
Key Operating Ratios
(Annualized):
Weighted Average
Interest Rate Spread 3.46% 3.71% 3.61% 3.53%
===== ===== ===== =====
Net Yield on Average
Interest Earning
Assets 3.78% 4.10% 3.93% 3.98%
===== ===== ===== =====
Return on Average
Assets 0.67% 1.20% 1.15% 1.15%
===== ===== ===== =====
Return on Average
Equity 8.28% 15.14% 14.40% 14.39%
===== ====== ====== ======
Adjusted Return on
Average Assets (a) 1.34% 1.20% 1.32% 1.15%
===== ===== ===== =====
Adjusted Return on
Average Equity (a) 16.64% 15.14% 16.61% 14.39%
====== ====== ====== ======
(a) Adjusted net earnings, adjusted net earnings per share-basic,
adjusted net earnings per share-diluted, adjusted return on
average assets and adjusted return on average equity for the
three and twelve months ended December 31, 2002 are calculated
based on net earnings plus the after tax impact of merger-related
charges of $1,895.
GRANITE STATE BANKSHARES, INC. and SUBSIDIARY
Average Balance Sheet Data
($ in thousands)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- --------------------
2002 2001 2002 2001
-------- -------- -------- --------
(unaudited) (unaudited)
Average Balance Sheet Data:
Average loans and loans
held for sale $ 637,121 $ 674,246 $ 649,709 $ 667,963
======= ======= ======= =======
Average interest earning
assets $1,039,260 $ 967,967 $1,009,401 $ 929,468
========= ======= ========= =======
Average interest bearing
deposits $ 656,129 $ 625,351 $ 644,351 $ 608,540
======= ======= ======= =======
Average interest bearing
liabilities $ 905,508 $ 851,660 $ 886,098 $ 821,767
======= ======= ======= =======
Average stockholders'
equity $ 89,869 $ 82,224 $ 85,958 $ 79,118
====== ====== ====== ======
Average assets $1,112,467 $1,034,015 $1,077,510 $ 992,782
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