MCCALL, ID--(Marketwire - February 6, 2008) - Today Idaho First Bank (
President and CEO Greg Lovell said, "This growth is encouraging despite the sluggish local business conditions that hindered us in reaching our loan targets in 2007. The reduced loan activity further caused us to reduce rate-sensitive deposits, improving net interest margin. The impact of the national economy, subprime fallout, and other economic forces not related directly to McCall, will significantly affect our local economy during the rest of 2008. While these outside market disruptions will continue to affect the Bank, we are confident that the long-range outlook for this area is resilient."
The Bank's net loss for 2007 was $1,447,000, an increase of 11% from the prior year. The major causes of the loss were slower loan growth, expansion costs in Boise and the new headquarters building in McCall. Mr. Lovell commented, "Expense containment is a high priority for 2008. The commitment to control expenses is already evidenced by the 11% reduction in expenses from the third quarter to the fourth quarter of 2007."
Nonperforming assets at December 31, 2007, were $495,000. This balance consisted of a development loan in the Boise area and a construction loan in Portland. These loans were purchased from another bank. Both loans, as well as the entire portfolio, have been carefully reviewed for potential losses. Mr. Lovell said, "We have made appropriate adjustments to our allowance for loan losses. The lead bank is working to strengthen our collateral position and protect against loss on these loans. We are committed to maintaining a strong credit portfolio and will carefully monitor the resolution of these loans."
The Bank raised $4.1 million of additional equity in 2007 through a stock offering. The additional equity resulted in an increase of 16% to the book value per share. The book value per share increased from $5.71 at the end of 2006 to $6.59 at December 31, 2007. As the bank reaches its planned growth targets, it will seek additional capital in the first half of 2008.
Commenting on the future, Mr. Lovell said, "We hired Mr. Don Waniata to be the President of our Boise office. Don has had a long history in both community banking and the large national banks. We also transferred Steve Zabel from our McCall office to the Boise office. While the Boise economy is being affected by national economic trends, the diversity and size of the market will allow the Bank to find profitable loan growth, while maintaining high credit standards. The continued expansion into the contiguous market of Boise is the correct long-term strategy to create a profitable and thriving Bank. We project that with the changes we have made we can reach sustainable profitability later in 2008."
Idaho First Bank
Financial Highlights
(Dollars in thousands, except per share)
For the year ended December 31: 2007 2006 Change
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Net interest income $ 1,472 $ 847 $ 625 74%
Provision for loan losses 109 247 (138) -56%
Mortgage banking income 141 72 69 96%
Other noninterest income 154 81 73 90%
Noninterest expenses 3,105 2,060 1,045 51%
Net loss (1,447) (1,307) (140) -11%
At December 31: 2007 2006 Change
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Loans $ 27,123 $ 20,521 $ 6,602 32%
Allowance for loan losses 400 291 109 37%
Assets 38,207 30,538 7,669 25%
Deposits 31,882 27,186 4,696 17%
Stockholders' equity 6,004 3,103 2,901 93%
Nonperforming loans/assets 495 225 270 120%
Book value per share 6.59 5.71 0.89 16%
Shares outstanding 910,964 543,868 367,096 67%
Allowance to loans 1.47% 1.42%
Allowance to nonperforming loans 81% 129%
Nonperforming loans to loans 1.83% 1.10%
Averages for year ended December 31: 2007 2006 Change
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Loans $ 23,722 $ 12,159 $ 11,563 95%
Earning assets 32,518 19,935 12,583 63%
Assets 34,669 21,619 13,050 60%
Deposits 29,543 17,797 11,746 66%
Stockholders' equity 4,430 3,684 746 20%
Loans to deposits 80% 68%
Net interest margin 4.53% 4.25%
Contact Information: Contacts: Greg Lovell President and CEO 208-630-2001 Don Madsen CFO 208-947-0430