BOCA RATON, Fla., April 30, 2009 (GLOBE NEWSWIRE) -- Sun American Bancorp (Nasdaq:SAMB) ("Sun American"), the bank holding company for Sun American Bank, today announced its First Quarter 2009 Results.
Unaudited Financial Highlights --
-- Total assets increased by $11 million or 2% from year end.
-- Cash balances increased by $22 million or 132% from year end.
-- Net loans decreased by $11.5 million or 3% from year end.
-- Total deposits increased by $16 million or 3.6% from year end.
-- Core customer deposits increased by $22 million or 8% from year
end.
-- Non-performing assets increased to $49.9 million or 10.82% of
assets from $29.8 million or 5.1% of assets at year end.
-- Net interest margin ("NIM") was 2.03% compared to 3.44% for all
of 2008 and compared to 3.74% in Q1 2008.
-- Average cost of funds decreased to 3.37% at March 31, 2009
compared to 3.59% for 2008.
-- Tangible common equity as a percentage of tangible assets of 6.10%
-- First quarter net loss of $5.3 million or $.52 per share.
"The challenges that face Sun American Bank and the South Florida banking industry remained with us during the first quarter of 2009," said Chief Executive Officer and Chairman Michael E. Golden. "One of our main challenges, our loan portfolio, is a direct result of the disastrous local and world wide economy. We are facing 10 % unemployment in South Florida currently and it looks like it will get worse before it gets better. Until such time as the economy improves Sun American Bank, along with all community banks, will have to deal with the uncontrollable challenges; such as borrowers not paying their loans on a timely basis, not having the capacity any longer to make the payments, and dealing with continuing drop in the value of commercial real-estate values. When all of the above has subsided we will then be able to get back to business as usual. There are some positive results showing up among the large investment banks, which are not truly commercial banks let alone community banks, but we do not have the added advantage of having trading desks, financial advisors, and other sources of derivative income. Community banks like us earn our money from loans from local borrowers who use real estate as their collateral."
"Our deposit base does remain strong and has grown during the first quarter 3.6% or $16 million. Our core deposits increased 8% or $22 million. Our cash balance also increased $22 million or 132%. The average cost of funds decreased and we believe it will continue to decrease going forward. This indicates that our existing customers and new ones alike continue to bank with us and show confidence in us. The loan loss provision for the first quarter of 2009 was $2.8 million compared to $2.3 million for the fourth quarter of 2008. Our controllable operating expenses decreased by $579,000 in the first quarter of 2009 and I expect this trend to continue," said Mr. Golden.
"Management is focused on selling off the non performing loans and in general is working with our borrowers in order to mitigate their financial burdens. We continue to focus on raising capital through all means available to us. We have had many meetings in the last six months with private equity firms and other groups that have come to us or have been directed to us through our investment Banking firm Keefe, Bruyette & Woods, Inc."
"We maintain that Sun American Bank is a valuable entity with a strong infrastructure, good business model, platform and footprint. This too will come to an end and we will show more positive results. As we all know the economy will eventually turn up."
Unaudited Operating Results
Sun American Bancorp's quarterly net interest income was $2.7 million compared to $3.7 million in the fourth quarter of 2008. This decrease was largely due to interest reversals on new non-accruing loans which totaled $357,000 in the first quarter of 2009. Also the overall average loan portfolio yield decreased from 6.99% for the year ended December 31, 2008 to 5.62% at March 31, 2009.
The NIM for the three months ended March 31, 2009 was 2.03% compared to 3.44% for 2008.
Interest and fees on loans decreased 17% to $5.9 million in the first quarter of 2009 compared to $7.1 million in the fourth quarter of 2008 due to the lower yields earned on loans and due to $357,000 of interest reversals on new non-accrual loans.
For the first quarter of 2009, Sun American recorded $2.8 million in provision for loan losses in response to higher levels of non-performing assets associated with collateral dependent commercial real estate loans. The comparative provision for loan loss for the three months ended December 31, 2008 was $2.3 million.
Operating expenses increased to $5.6 million for the first quarter of 2009, from $5.3 million in the first quarter of 2008. The increase in expenses was due to an increase of FDIC insurance of $400,000 compared to the first three months of 2008, and due to losses on sale of Other Real Estate Owned ("OREO") in the amount of $455,000 which was not required in 2008. Controllable operating expenses decreased by $579,000 in the first quarter of 2009 compared to the first quarter of 2008.
Robert Nichols, Chief Financial Officer of Sun American Bank, stated, "Our operating results for the first three months of 2009 continue to reflect the depressed economic conditions in our market place. Some of our borrowers continue to struggle to meet their loan repayment obligations. These borrower repayment issues are reflected in our financial results through reduced loan yields, higher than normal loan loss provisions, higher levels of non-accrual loans, higher OREO levels and higher operating expenses caused by increased loan legal and OREO disposal costs. We continue to work diligently with our clients to implement asset quality solutions where feasible."
Unaudited Balance Sheet Activity
Sun American Bancorp ended the quarter with assets of $601.1 million at March 31, 2009, up by $11.1 million or 2% from $590 million at December 31, 2008. The increase in asset levels was primarily due to an increase in cash liquidity of $22 million in the quarter.
Net loans declined to $454.5 million at March 31, 2009, a decrease of 3% from $466.0 million at December 31, 2008. Total non-performing assets were $49.9 million at March 31, 2009, compared to $29.8 million at December 31, 2008. The ratio of non-performing assets as a percentage of total assets increased to 10.8% at March 31, 2009, from 5.1% at December 31, 2008.
The total allowance for loan losses was $6.3 million at March 31, 2009 after taking charge offs of $3.0 million in the quarter. This compared to $6.6 million at December 31, 2008. The allowance for loan losses as a percentage of the total loan portfolio was 1.37% at March 31, 2009, compared to 1.39% at December 31, 2008. Before loan charge offs, the allowance for loan losses represented 2.0% of the total loan portfolio at March 31, 2009.
Total deposits of $459.7 million at March 31, 2009 had increased by $16 million or 16% from year end 2008, including a $22 million or 8% increase in core customer deposits.
Stockholders' equity decreased 12% to $36.7 million at March 31, 2009 compared to $41.8 million at December 2008. The $5.0 million decrease in equity was primarily due to a net loss in the quarter of $5.3 million.
Mr. Golden further commented that "Capital preservation remains a primary focus of the Bank during this difficult economic environment. We are actively pursuing new sources of capital to provide additional strength to our balance sheet. We remain well capitalized as measured by regulatory requirements. We are proactively working to mitigate asset quality issues where possible."
About Sun American Bancorp
Based in Boca Raton, Florida, Sun American Bancorp is the single-bank holding company of Sun American Bank, a state-chartered, federal member bank engaged in a general commercial and consumer banking business. Sun American Bank operates 14 offices in Miami, Broward, Palm Beach and Martin Counties in Southeast Florida. For additional information, please visit our website at www.sunamericanbank.com.
The Sun American Bancorp logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3685
Except for historical information containing herein, the matters set forth in this news release are "forward-looking" statements, as defined in the Private Securities Litigation Reform Act of 1995. Although Sun American Bancorp believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions; there can be no assurance that its expectations will be realized. Forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from Sun American Bancorp's expectations. Factors that could contribute to such differences include those identified in Sun American Bancorp's Form 10-K for the year-ended December 31, 2008, and those described from time to time in Sun American's other filings with the Securities and Exchange Commission, news releases and other communications.
SUN AMERICAN BANCORP
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2009 2008
(Unaudited)
------------- -------------
Cash and due from financial
institutions $ 38,468,980 $ 5,371,609
Federal funds sold -- 11,189,000
------------- -------------
Total cash and cash equivalents 38,468,980 16,560,609
Securities available for sale 29,198,763 30,285,750
Securities held to maturity (fair
value 2009 - $55,390,222, 2008 -
$54,170,963) 54,263,042 52,752,317
Loans, net of allowance for loan
losses of $6,297,989 in 2009 and
$6,562,780 in 2008 454,507,544 466,017,871
Federal Reserve Bank stock 1,503,100 3,018,150
Federal Home Loan Bank stock 4,123,700 3,740,600
Accrued interest receivable 2,322,883 2,656,414
Premises and equipment, net 9,676,910 9,991,118
Other assets 7,059,977 4,963,019
------------- -------------
TOTAL ASSETS $ 601,124,899 $ 589,985,848
============= =============
LIABILITIES AND SHAREHOLDERS'
EQUITY
Deposits
Non-interest bearing $ 48,923,546 $ 43,116,630
Interest bearing 410,789,960 400,371,612
------------- -------------
Total deposits 459,713,506 443,488,242
Securities sold under agreements
to repurchase 35,069,356 35,916,707
Federal Home Loan Bank advances 58,000,000 58,000,000
Notes payable 7,528,871 7,528,871
Accrued expenses and other
liabilities 4,072,262 3,268,828
------------- -------------
Total liabilities 564,383,995 548,202,647
Minority interest 11,795 13,851
Shareholders' equity
Preferred Stock, $.01 par value;
5,000,000 shares authorized;
Series A - 93,750 issued and
outstanding at March 31, 2009
and December 31, 2008 375,000 375,000
Common stock, $.025 par value;
20,000,000 shares authorized;
10,934,944 issued and
10,230,466 shares outstanding
at March 31, 2009 and December
31, 2008 273,374 273,374
Additional paid-in capital 107,161,563 106,864,390
Accumulated deficit (66,858,654) (61,517,170)
Treasury stock at cost, 704,478
shares at March 31, 2009 and
December 31, 2008 (3,574,046) (3,574,046)
Accumulated other comprehensive
loss (648,128) (652,198)
------------- -------------
Total shareholders' equity 36,729,109 41,769,350
------------- -------------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $ 601,124,899 $ 589,985,848
============= =============
SUN AMERICAN BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended March 31, 2009 and 2008
March 31, March 31,
2009 2008
-------------- -------------
(Unaudited) (Unaudited)
Interest and dividend income:
Loans, including fees $ 5,864,028 $ 8,196,907
Securities 1,090,548 941,181
Federal funds sold and other 12,308 62,806
-------------- -------------
6,966.884 9,200,894
Interest expense:
Deposits 3,467,469 3,612,994
FHLB advances 485,659 704,204
Other 337,793 126,923
-------------- -------------
4,290,921 4,444,121
-------------- -------------
Net interest income before
provision for loan losses 2,675,963 4,756,773
Provision for loan losses 2,761,400 (48,400)
-------------- -------------
Net interest income after provision
for loan losses (85,437) 4,805,173
Non-interest income:
Service charges on deposit
accounts 380,584 416,111
Other income 9,812 153,015
-------------- -------------
390,396 569,126
Non-interest expenses:
Salaries and employee benefits 2,247,502 2,458,759
Occupancy and equipment 1,302,114 1,360,755
Data and item processing 172,851 227,888
Professional fees 331,068 239,684
Insurance 554,516 157,450
Advertising 12,842 34,084
Amortization of intangible
assets -- 218,314
Other 1,026,758 575,156
-------------- -------------
5,647,651 5,272,090
-------------- -------------
(Loss) Income before income taxes
and minority interest (5,342,692) 102,209
Minority interest in net loss
(income) of subsidiary 1,208 (97)
-------------- -------------
(Loss) income before provision for
income taxes (5,341,484) 102,112
-------------- -------------
Income tax expense -- 96,747
-------------- -------------
Net (loss) income $ (5,341,484) $ 5,365
============== ==============
Basic loss per share $ (0.52) $ 0.00
============== ==============
Diluted loss per share $ (0.52) $ 0.00
============== ==============
Weighted average number of shares
of common stock, basic 10,230,466 10,462,434
============== ==============
Weighted average number of shares
of common stock, diluted 10,230,466 10,538,272
============== ==============
SUN AMERICAN BANCORP
CONSOLIDATED AVERAGE BALANCE SHEET (UNAUDITED)
For the three months ended March 31,
--------------------------------------------------
2009 2008
------------------------ ------------------------
Avg. Avg.
Yield/ Yield/
Avg. Interest Rate Avg. Interest Rate
Balance (4) (3) Balance (4) (3)
-------- -------- ---- -------- -------- ----
(Dollars
in
thousands)
Assets:
Interest-
earning
assets:
Investments
(1) $ 89,477 $ 1,091 4.94% $ 61,577 $ 941 6.13%
Cash on
deposit 22,759 12 0.22 7,775 63 3.24
Loans:
Commercial
loans
(2) 24,250 262 4.39 31,900 602 7.57
Commercial
mortgage
loans (2) 288,141 4,094 5.76 301,276 5,632 7.50
Consumer
loans
(2) 2,213 32 5.92 4,879 90 7.36
Residential
mortgage
loans (2) 77,804 1,093 5.70 71,811 1,341 7.49
Home
equity
and
other
loans
(2) 30,865 383 5.02 31,217 532 6.84
-------- -------- ---- -------- -------- ----
Total
loans 423,273 5,864 5.62 441,083 8,197 7.45
-------- -------- -------- --------
Total
interest
earning
assets 535,509 6,967 5.28 510,435 9,201 7.23
Non-
interest
earning
assets 68,930 74,150
-------- --------
Total $604,439 $584,585
======== ========
Liabilities
and
Stockholders'
Equity:
Interest-
bearing
liabilities:
Deposits:
NOW
accounts $ 33,610 153 1.84 $ 74,520 570 3.07
Money
Market
accounts 26,411 104 1.60 58,079 555 3.83
Savings
accounts 61,523 458 3.02 25,193 228 3.63
Certificates
of
deposit 287,869 2,752 3.88 185,729 2,260 4.88
-------- -------- -------- --------
Total
interest-
bearing
deposits 409,413 3,467 3.43 343,521 3,613 4.22
Federal
funds
purchased
and
securities
sold under
repurchase
agreement 35,721 294 3.34 7,351 75 4.10
Federal Home
Loan Bank
advances 63,111 486 3.12 76,824 704 3.68
Notes
payable 7,529 44 2.35 3,463 52 5.99
-------- -------- -------- --------
Total
interest
bearing
liabilities 515,774 4,291 3.37 431,159 4,444 4.13
-------- -------- -------- --------
Non-
interest
bearing
liabilities 47,447 56,027
Stockholders'
equity 41,218 97,399
-------- --------
Total $604,439 $584,585
======== ========
Net
Interest
income
and yield
on net
interest-
earning
assets $ 2,676 2.03 $ 4,757 3.74%
======== ==== ======== =====
(1) Includes investment securities, Federal Reserve Bank stock and
Federal Home Loan Bank stock.
(2) Excludes loans for which the accrual of interest has been
suspended.
(3) Yields and rates are annualized.
(4) Includes fee income on loans.