-- Quarterly loss narrows compared to the prior year
-- Risk-Based Capital ratios continue to improve representing a new high
for the Company
-- Year-to-date net interest margin and net interest income expand
compared to the prior year
-- Non-performing assets decline by over 15% from their peak at
September 30, 2009
Guaranty Bancorp (
Income Statement
Quarter Ended Six Months Ended
---------------------------- ------------------
June 30, March 31, June 30, June 30, June 30,
2010 2009 2009 2010 2009
-------- -------- -------- -------- --------
Loss per share-basic &
diluted $ (0.11) $ (0.06) $ (0.21) $ (0.17) $ (0.20)
Return on average assets (0.87%) (0.36%) (2.17%) (0.61%) (1.03%)
Net Interest Margin 3.47% 3.50% 3.38% 3.48% 3.32%
Balance Sheet
June 30, December 31, June 30,
2010 2009 % Change 2009 % Change
--------- --------- -------- --------- --------
(Dollars in thousands, except per share amounts)
Cash and cash
equivalents $ 184,701 $ 234,483 (21.2)% $ 28,403 550.3 %
Total investments 312,293 248,236 25.8 % 124,952 149.9 %
Total loans, net of
unearned discount 1,374,208 1,519,608 (9.6)% 1,651,572 (16.8)%
Loans held for sale 1,150 9,862 (88.3)% 5,250 (78.1)%
Allowance for loan
losses (46,866) (51,991) (9.9)% (43,041) 8.9 %
Total assets 1,983,798 2,127,580 (6.8)% 1,944,867 2.0 %
Average assets,
quarter-to-date 1,999,527 2,117,257 (5.6)% 2,011,314 (0.6)%
Total deposits 1,544,271 1,693,290 (8.8)% 1,560,730 (1.1)%
Book value per
common share 2.38 2.50 (4.8)% 2.93 (18.8)%
Tangible book value
per common share 2.06 2.13 (3.3)% 2.50 (17.4)%
Tangible book value
per common share
(after giving
effect to conversion
of preferred stock) 1.96 2.00 (2.1)% 2.50 (21.6)%
Book value of
preferred stock 61,961 59,227 4.6 % None N/A
Liquidation value of
preferred stock 63,168 60,434 4.5 % None N/A
Equity ratio - GAAP 9.53% 9.05% 5.3 % 7.90% 20.6 %
Tangible equity
ratio 8.76% 8.23% 6.4 % 6.83% 28.3 %
Total risk-based
capital ratio 14.80% 13.80% 7.2 % 10.73% 37.9 %
Net Interest Income and Margin
Quarter Ended Six Months Ended
---------------------------- ------------------
June 30, March 31, June 30, June 30, June 30,
2010 2010 2009 2010 2009
-------- -------- -------- -------- --------
(Dollars in
thousands)
Net interest income $ 16,133 $ 16,632 $ 15,860 $ 32,765 $ 31,578
Interest rate spread 3.09% 3.10% 2.77% 3.10% 2.69%
Net interest margin 3.47% 3.50% 3.38% 3.48% 3.32%
Net interest margin,
fully tax equivalent 3.55% 3.58% 3.46% 3.56% 3.40%
Second quarter 2010 net interest income of $16.1 million decreased by $0.5
million from the first quarter 2010, and increased by $0.3 million from the
second quarter 2009. The Company's net interest margin of 3.47% for the
second quarter 2010 reflected a decrease of three basis points from the
first quarter 2010 and an increase of nine basis points from the second
quarter 2009. The decrease in net interest margin in the second quarter
2010, as compared to the first quarter 2010, is primarily a result of an
overall decline in the yield on earning assets due to a shift from loans to
lower yielding investments. The overall yield on earning assets was 4.74%
in the second quarter 2010 as compared to 4.90% in the first quarter 2010.
This decline in yield was mostly offset by a decline in interest bearing
liabilities, which decreased from 1.80% in the first quarter 2010 to 1.65%
in the second quarter 2010.
Net interest margin increased by 9 basis points in the second quarter 2010
as compared to the same quarter in 2009 due to a $2.9 million favorable
rate variance, less a $2.7 million unfavorable volume variance. The
favorable rate variance is primarily attributable to a 13 basis point
increase in loan yields in the second quarter 2010 as compared to the same
period in 2009, as well as an 86 basis point decline in the overall cost of
funds over the same period. Loan yields increased primarily as a result of
loans repricing with minimum rates established on loan renewals. The
overall cost of funds declined primarily due to a 146 basis point decrease
in time deposit rates resulting from lower renewal rates on such deposits.
The unfavorable volume variance is primarily the result of a $314.4 million
decline in average loan balances in the second quarter 2010 as compared to
the same quarter in 2009.
Net interest income for the first six months of 2010 increased by $1.2
million to $32.8 million compared to the same period in 2009. This increase
was mostly the result of a 16 basis point increase in net interest margin,
leading to a $7.7 million favorable rate variance offset by a $6.5 million
unfavorable volume variance. The volume variance is due mostly to the
$315.2 million decrease in average loan balances. The favorable rate
variance is due mostly to an 81 basis point decline in the cost of
interest-bearing liabilities as well as an increase to overall loan yields.
The overall yield on earning assets declined by 40 basis points due mostly
to the impact of an additional $165.2 million average balance of overnight
funding over the first six months of 2010 earning approximately 25 basis
points. At June 30, 2010, management believes that the Company remains
slightly asset sensitive whereby an increase in rates will have a favorable
impact on overall net interest income, especially with greater increases in
overall rates.
Noninterest Income
The following table presents noninterest income as of the dates indicated:
Quarter Ended Six Months Ended
----------------------------- -----------------
June 30, March 31, June 30, June 30, June 30,
2010 2010 2009 2010 2009
--------- --------- --------- --------- -------
(In thousands)
Noninterest income:
Customer service and other
fees $ 2,254 $ 2,214 $ 2,354 $ 4,468 $ 5,033
Gain on sale of securities 1 14 - 15 -
Gain on sale of loans 1,196 - - 1,196 -
Other 274 194 277 468 492
--------- --------- --------- --------- -------
Total noninterest income $ 3,725 $ 2,422 $ 2,631 $ 6,147 $ 5,525
========= ========= ========= ========= =======
Noninterest income for the second quarter 2010 increased by $1.3 million
from the first quarter 2010 and increased $1.1 million from the second
quarter 2009. These increases were mostly attributable to the gain on the
sale of two loans held for sale during the second quarter 2010.
For the six months ended June 30, 2010, noninterest income, excluding the
$1.2 million gain on sale of loans, decreased by $0.6 million compared to
the same period in 2009. This decrease is mostly due to lower account
analysis fees, as well as other service charges as some customers migrated
to lower fee transaction accounts.
Noninterest Expense
The following table presents noninterest expense as of the dates indicated:
Quarter Ended Six Months Ended
----------------------------- -------------------
June 30, March 31, June 30, June 30, June 30,
2010 2010 2009 2010 2009
--------- --------- --------- --------- ---------
(In thousands)
Noninterest expense:
Salaries and employee
benefits $ 6,472 $ 6,563 $ 6,712 $ 13,035 $ 13,451
Occupancy expense 1,836 1,890 1,926 3,726 3,847
Furniture and equipment 967 976 1,147 1,943 2,278
Amortization of
intangible assets 1,300 1,300 1,581 2,600 3,163
Other real estate owned 3,115 2,749 915 5,864 963
Insurance and assessment 1,825 1,812 2,195 3,637 3,236
Professional fees 739 877 896 1,616 1,745
Other general and
administrative 2,165 1,959 2,346 4,124 4,495
--------- --------- --------- --------- ---------
Total noninterest
expense $ 18,419 $ 18,126 $ 17,718 $ 36,545 $ 33,178
========= ========= ========= ========= =========
Noninterest expense for the second quarter 2010 increased by $0.3 million
as compared to the first quarter 2010 and increased by $0.7 million from
the second quarter 2009. These increases are primarily due to increases in
other real estate owned and loan workout related expenses, mostly offset by
lower costs in other categories of noninterest expense.
The $0.3 million increase in noninterest expense in the second quarter 2010
as compared to the first quarter 2010 is due mostly to a $0.4 million
increase in expenses related to other real estate owned and a $0.2 million
increase in other general and administrative expenses. The increase in
other real estate owned expense is due to an increase in write-downs on
other real estate owned properties resulting from valuation adjustments and
sales. The increase in other general and administrative expenses is due
mostly to higher workout related expenses. All other categories of expense
declined or remained relatively flat in the second quarter 2010 as compared
to the first quarter 2010.
The $0.7 million increase in noninterest expense in the second quarter 2010
as compared to the same period in 2009 is the result of a $2.2 million
increase in other real estate owned expense, mostly offset by declines in
all other categories of expense. The increase in other real estate owned
expense is due to an increase in write-downs on other real estate owned
properties resulting from valuation adjustments and sales. The $0.2
million decline in overall salaries and employee benefit expense in the
second quarter 2010 as compared to the same period in 2009 is due mostly to
a reduction in full time equivalent staff, as well as reductions in
bonuses, incentives and restricted stock expense. Overall occupancy and
furniture & equipment expense declined by $0.3 million due to lower
depreciation and lease expense resulting from the reduction of leased space
in our headquarters building. Amortization of intangible assets declined
by $0.3 million in the current quarter as compared to the same period last
year due to accelerated amortization of intangible assets associated with
previous acquisitions. Overall insurance and assessments decreased by $0.4
million in the second quarter 2010 as compared to the same quarter in 2009.
This reduction in cost is the result of a one-time FDIC insurance
assessment in the second quarter 2009 for which the Company recorded an
additional $0.9 million of expense. Although there was no similar
assessment in 2010, our ongoing FDIC assessment rates are higher in 2010 as
compared to 2009. The $0.2 million decline in professional fees is due
mostly to lower legal costs, while the $0.2 million decline in other
general and administrative expenses is due mostly to lower data processing
costs.
Noninterest expense for the six months ended June 30, 2010 increased by
$3.4 million compared to the same period in 2009 primarily due to a $4.9
million increase in expenses associated with other real estate owned and a
$0.4 million increase in insurance and assessments, due mostly to the 2010
FDIC insurance assessment rate exceeding the prior year assessment rate
including the prior year special assessment. All other categories of
expense declined in the first six-months of 2010 as compared to the same
period in 2009. The primary causes for these declines in overall expenses
for the year-to-date period in 2010 as compared to 2009 are a reduction in
full-time equivalent employees, reduced bonus and incentive expense,
reduced amortization due to the use of accelerated amortization methods and
other cost reduction initiatives of the Company.
Income Taxes
The effective tax benefit rate for the second quarter 2010 was 37.4% as
compared to 39.1% for the same period in 2009. The effective tax benefit
rate for the year-to-date period in 2010 was 38.2% as compared to 39.4% in
2009. The primary differences between the expected tax benefit rate and
the actual tax benefit rate are state taxes and tax-exempt income.
Preferred Stock Dividend
Effective May 15, 2010, a non-cash preferred stock dividend was paid in the
form of additional shares of Series A convertible preferred stock to
holders of Series A convertible preferred stock in the amount of $1.4
million.
Balance Sheet
June 30, December 31, June 30,
2010 2009 % Change 2009 % Change
---------- ---------- --------- ---------- ---------
(Dollars in thousands, except per share amounts)
Total assets $1,983,798 $2,127,580 (6.8)% $1,944,867 2.0 %
Average assets,
quarter-to-
date 1,999,527 2,117,257 (5.6)% 2,011,314 (0.6)%
Loans, net of
unearned
discount 1,374,208 1,519,608 (9.6)% 1,651,572 (16.8)%
Total deposits 1,544,271 1,693,290 (8.8)% 1,560,730 (1.1)%
Equity ratio -
GAAP 9.53% 9.05% 5.3 % 7.90% 20.6 %
Tangible equity
ratio 8.76% 8.23% 6.4 % 6.83% 28.3 %
At June 30, 2010, the Company had total assets of $2.0 billion which
represented a $143.8 million decline as compared to December 31, 2009, and
a $38.9 million increase as compared to June 30, 2009. The decline in
assets from December 31, 2009 is mostly due to a $145.4 million decline in
loans, net of unearned discount. This loan decline was due mostly to a
$109.4 million decline in commercial loans and a $32.6 million decline in
real estate loans.
Although total assets remained relatively flat at June 30, 2010 as compared
to June 30, 2009, there was a change in the mix of assets as total loans
declined by $277 million, while investment securities increased by $187
million and cash and cash equivalents increased by $138 million. Management
continues to evaluate alternatives to utilize this additional low-yielding
liquidity in the existing interest-rate environment in order to improve our
future net interest margin. The increase in investment securities is
nearly all related to purchases of mortgage-backed government agency or
government-sponsored agency securities.
The GAAP equity ratio and tangible equity ratio increased at June 30, 2010
as compared to December 31, 2009. Additionally, both the GAAP equity ratio
and tangible equity ratio increased significantly from June 30, 2009,
primarily as a result of the issuance of $57.8 million, net of expenses, of
convertible preferred stock in August 2009.
The following table sets forth the amounts of our loans outstanding
(excluding loans held for sale) at the dates indicated:
June 30, March 31, December 31, June 30,
2010 2010 2009 2009
----------- ----------- ----------- -----------
(In thousands)
Loans on real estate:
Residential and
commercial $ 754,019 $ 748,135 $ 760,719 $ 682,923
Construction 83,389 111,231 105,612 190,197
Equity lines of credit 51,221 53,014 54,852 55,812
Commercial loans 411,605 448,908 521,016 639,462
Agricultural loans 17,968 17,203 18,429 22,764
Lease financing 4,014 4,014 4,011 4,722
Installment loans to
individuals 31,936 34,986 36,175 37,878
Overdrafts 668 612 358 569
SBA and other 21,607 19,396 20,997 20,215
----------- ----------- ----------- -----------
1,376,427 1,437,499 1,522,169 1,654,542
Unearned discount (2,219) (2,428) (2,561) (2,970)
----------- ----------- ----------- -----------
Loans, net of unearned
discount $ 1,374,208 $ 1,435,071 $ 1,519,608 $ 1,651,572
=========== =========== =========== ===========
There were $888.6 million of real estate loans at June 30, 2010 as compared
to $921.2 million at December 31, 2009, a decrease of $32.6 million as
management continues to decrease risk related to real estate lending.
The following table sets forth the amounts of our deposits outstanding at
the dates indicated:
June 30, March 31, December 31, June 30,
2010 2010 2009 2009
----------- ----------- ----------- -----------
(In thousands)
Noninterest-bearing
deposits $ 338,169 $ 363,059 $ 366,103 $ 352,185
Interest-bearing demand 171,721 165,315 171,844 142,013
Money market 323,331 321,603 352,127 306,243
Savings 75,338 74,537 71,816 72,143
Time 635,712 678,370 731,400 688,146
----------- ----------- ----------- -----------
Total deposits $ 1,544,271 $ 1,602,884 $ 1,693,290 $ 1,560,730
=========== =========== =========== ===========
Noninterest-bearing deposits as a percentage of total deposits was 21.9% at
June 30, 2010, as compared to 21.6% at December 31, 2009.
The overall decline in deposits is partially attributable to a decrease in
wholesale deposits, including both brokered deposits as well as internet
deposits. Brokered and internet deposits have declined by $47.9 million
from December 31, 2009 to June 30, 2010. Total brokered deposits at June
30, 2010 were $219.5 million, excluding reciprocal deposits through the
Certificate of Deposit Account Registry Service (CDARS), as compared to
$254.6 million at December 31, 2009. The remaining decline in time
deposits is primarily related to the non-renewal of other higher cost
certificates of deposits, including those with special rates.
Borrowings were $164.3 million at June 30, 2010 as compared to $164.4
million at December 31, 2009, and $164.5 million at June 30, 2009. The
entire balance of borrowings at each balance sheet date consisted of term
advances with the Federal Home Loan Bank.
Regulatory Capital Ratios
The Company's and the subsidiary bank's capital ratios increased at June
30, 2010 as compared to December 31, 2009 due to a decrease in
risk-weighted assets. All of the regulatory capital ratios are above the
highest regulatory capital requirement of "well-capitalized" at June 30,
2010. The Company's and the subsidiary bank's actual capital ratios for
June 30, 2010 and December 31, 2009 are presented in the table below:
Minimum
Requirement
Ratio at Ratio at Minimum for "Well
June 30, December 31, Capital Capitalized"
2010 2009 Requirement Institution
--------- ----------- ----------- -----------
Total Risk-Based Capital
Ratio:
Consolidated 14.80% 13.80% 8.00% N/A
Guaranty Bank and
Trust Company 13.82% 12.82% 8.00% 10.00%
Tier 1 Risk-Based Capital
Ratio:
Consolidated 9.77% 9.43% 4.00% N/A
Guaranty Bank and
Trust Company 12.55% 11.55% 4.00% 6.00%
Leverage Ratio:
Consolidated 7.87% 7.89% 4.00% N/A
Guaranty Bank and
Trust Company 10.18% 9.66% 4.00% 5.00%
Generally, the allowance for loan losses is included in total capital for
regulatory purposes; however, it is limited to 1.25% of total risk-weighted
assets. At June 30, 2010, approximately $26.7 million of the subsidiary
bank's allowance for loan losses is disallowed from being included in total
risk-based capital under the regulatory capital rules, or approximately
1.67% of the subsidiary bank's risk-weighted assets.
Asset Quality
The following table presents selected asset quality data (excluding loans
held for sale) as of the dates indicated:
June 30, March 31, December September June 30,
2010 2010 31, 2009 30, 2009 2009
--------- --------- --------- --------- ---------
(Dollars in thousands)
Nonaccrual loans,
not restructured $ 64,339 $ 70,500 $ 59,584 $ 81,035 $ 52,483
Other nonperforming
loans 1,065 558 123 150 2,671
--------- --------- --------- --------- ---------
Total nonperforming
loans (NPLs) $ 65,404 $ 71,058 $ 59,707 $ 81,185 $ 55,154
Other real estate
owned and
foreclosed assets 30,298 30,918 37,192 32,246 34,746
--------- --------- --------- --------- ---------
Total nonperforming
assets (NPAs) $ 95,702 $ 101,976 $ 96,899 $ 113,431 $ 89,900
========= ========= ========= ========= =========
Accruing loans past
due 90 days or more
(1) $ 1,065 $ 558 $ 123 $ 9,140 $ 2,671
========= ========= ========= ========= =========
Accruing loans past
due 30-89 days (1) $ 33,050 $ 21,956 $ 21,709 $ 52,443 $ 39,836
========= ========= ========= ========= =========
Allowance for loan
losses $ 46,866 $ 52,015 $ 51,991 $ 49,038 $ 43,041
========= ========= ========= ========= =========
Selected ratios:
NPLs to loans, net
of unearned
discount 4.76% 4.95% 3.93% 5.11% 3.34%
NPAs to total assets 4.82% 5.02% 4.55% 5.51% 4.62%
Allowance for loan
losses to NPAs 48.97% 51.01% 53.65% 43.23% 47.88%
Allowance for loan
losses to NPLs 71.66% 73.20% 87.08% 60.40% 78.04%
Allowance for loan
losses to loans,
net of unearned
discount 3.41% 3.62% 3.42% 3.09% 2.61%
Loans 30-89 days
past due to loans,
net of unearned
discount 2.40% 1.53% 1.43% 3.30% 2.41%
(1) Past due loans include both loans that are past due with respect to
payments, and loans that are past due with respect to the fact that the
loan has matured and is in the process of renewal, but continues to be
current with respect to payments.
The types of nonperforming loans (excluding loans held for sale) as of June
30, 2010 and March 31, 2010 are as follows:
-----------------------------------------------------
Nonperforming Loans
-----------------------------------------------------
June 30, 2010 March 31, 2010
-------------------------- --------------------------
Loan Related Loan Related
Balance Percent Allowance Balance Percent Allowance
-------- ------- -------- -------- ------- --------
(Amounts in thousands)
Residential
Construction, Land
and Land Development $ 23,797 36.4% $ 517 $ 39,931 56.2% $ 4,681
Other Residential
Loans 3,647 5.6% 676 4,054 5.7% 649
Commercial and
Industrial Loans 10,710 16.4% 1,802 10,661 15.0% 1,620
Commercial Real
Estate 26,958 41.2% 717 16,069 22.6% 3,852
Other 292 0.4% 4 343 0.5% -
-------- ------- -------- -------- ------- --------
Total $ 65,404 100.0% $ 3,716 $ 71,058 100.0% $ 10,802
======== ======= ======== ======== ======= ========
The types of loans included in the accruing loans past due 30-89 days as of
June 30, 2010 and March 31, 2010 are as follows:
-----------------------------------
Accruing loans past due 30-89 days
-----------------------------------
June 30, 2010 March 31, 2010
---------------- -----------------
Loan Loan
Balance Percent Balance Percent
-------- ------- -------- --------
(Amounts in thousands)
Residential Construction, Land and Land
Development $ 483 1.5% $ 5,138 23.4%
Other Residential Loans 1,219 3.7% 1,382 6.3%
Commercial and Industrial Loans 2,758 8.3% 5,027 22.9%
Commercial Real Estate 27,290 82.6% 2,268 10.3%
Other 1,300 3.9% 8,141 37.1%
-------- ------- -------- --------
Total $ 33,050 100.0% $ 21,956 100.0%
======== ======= ======== =======
The overall level of accruing loans past due 30-89 days increased over the
previous quarter. At June 30, 2010, approximately $29.3 million of the
$33.1 million of accruing loans past due 30-89 days were matured and in the
process of renewal. Most of this category relates to a single loan of
$23.0 million at June 30, 2010. This compares to approximately $9.8
million of the $22.0 million of accruing loans past due 30-89 days at March
31, 2010, that were matured and in the process of renewal.
Net charge-offs in the second quarter 2010 were $13.5 million as compared
to $13.2 million in the same quarter last year and $4.0 million in the
first quarter 2010.
Impaired loans as of June 30, 2010 totaled $65.4 million compared to $71.1
million at March 31, 2010 and $59.7 million at December 31, 2009. Other
real estate owned was $30.3 million at June 30, 2010 compared to $30.9
million at March 31, 2010 and $37.2 million at December 31, 2009. Overall
nonperforming assets declined by $1.2 million at June 30, 2010 as compared
to December 31, 2009.
The general component of the allowance for loan losses at June 30, 2010 is
$43.2 million, or 92.1% of the entire allowance for loan losses, as
compared to $41.2 million, or 79.2% of the allowance for loan losses at the
end of the previous quarter.
The Company recorded a provision for loan losses in the second quarter 2010
of $8.4 million, as compared to $18.6 million in the same quarter in 2009.
The second quarter 2010 provision for loan consisted of an $6.5 million
increase in the specific component of the allowance including charge-offs
on impaired loans, as well as a $1.9 million increase in the general
component of the allowance due primarily to the impact of charge-offs on
the historical, economic concern and concentration components of the
allowance for loan losses.
Shares Outstanding
As of June 30, 2010, the Company had 52,757,233 shares of common stock
outstanding, including 1,221,835 shares of unvested stock awards, but
excluding 156,567 shares of common stock to be issued under its deferred
compensation plan. In addition, the Company had 63,168 shares of Series A
convertible preferred stock outstanding, with a liquidation value of $1,000
per share.
Non-GAAP Financial Measures
This press release includes non-GAAP financial measures related to tangible
assets, including tangible book value, tangible book value (after giving
effect to conversion of preferred stock), and tangible equity ratio, which
exclude intangible assets.
The Company discloses these non-GAAP financial measures to provide
meaningful supplemental information regarding the Company's operational
performance and to enhance investors' overall understanding of the
Company's core financial performance. Management believes that these
non-GAAP financial measures allow for additional transparency and are used
by some investors, analysts and other users of the Company's financial
information as performance measures. These non-GAAP financial measures are
presented for supplemental informational purposes only for understanding
the Company's operating results and should not be considered a substitute
for financial information presented in accordance with GAAP. These non-GAAP
financial measures presented by the Company may be different from non-GAAP
financial measures used by other companies.
The following non-GAAP schedule reconciles the book value per share to the
tangible book value per share and the tangible equity ratio as of the dates
indicated:
June 30, December 31, June 30,
2010 2009 2009
----------- ----------- -----------
(Dollars in thousands,
except per share amounts)
Tangible Book Value per Common Share
Total stockholders' equity $ 189,005 $ 192,638 $ 153,607
Less: Preferred share liquidation
preference (63,168) (60,434) -
----------- ----------- -----------
Stockholders' equity attributable
to common shares 125,837 132,204 153,607
Less: Intangible assets (16,622) (19,222) (22,337)
----------- ----------- -----------
Tangible common equity $ 109,215 $ 112,982 $ 131,270
=========== =========== ===========
Number of common shares outstanding
and to be issued 52,913,800 52,952,703 52,505,524
Number of shares of preferred stock
outstanding 63,168 60,434 N/A
Number of shares of common stock to
be issued upon conversion of
preferred stock 35,093,333 33,574,444 N/A
Book value per common share $ 2.38 $ 2.50 $ 2.93
Tangible book value per common
share $ 2.06 $ 2.13 $ 2.50
Tangible book value per common
share (after giving effect to
conversion of preferred stock) $ 1.96 $ 2.00 $ 2.50
Tangible Equity Ratio
Total assets $ 1,983,798 $ 2,127,580 $ 1,944,867
Less: Intangible assets (16,622) (19,222) (22,337)
----------- ----------- -----------
Tangible assets $ 1,967,176 $ 2,108,358 $ 1,922,530
=========== =========== ===========
Equity ratio - GAAP
(Total stockholders' equity /
total assets) 9.53% 9.05% 7.90%
Tangible equity ratio
(Tangible common equity +
Preferred share liquidation
preference) / tangible assets 8.76% 8.23% 6.83%
About Guaranty Bancorp
Guaranty Bancorp is a bank holding company that operates 34 branches in Colorado through a single bank, Guaranty Bank and Trust Company. The bank provides banking and other financial services including real estate, construction, commercial and industrial, energy, consumer and agricultural loans throughout its targeted Colorado markets to consumers and small to medium-sized businesses, including the owners and employees of those businesses. The bank also provides trust services, including personal trust administration, estate settlement, investment management accounts and self-directed IRAs. More information about Guaranty Bancorp can be found at www.gbnk.com. Forward-Looking Statements This press release contains forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "plans," "intends," "anticipates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of such terms and other comparable terminology. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: failure to maintain adequate levels of capital and liquidity to support Company's operations; the effect of the regulatory written agreement the Company and its bank subsidiary have entered into and potential future supervisory action against the Company or its bank subsidiary; general economic and business conditions in those areas in which the Company operates; demographic changes; competition; fluctuations in interest rates; continued ability to attract and employ qualified personnel; ability to receive regulatory approval for our bank subsidiary to declare dividends to the Company; adequacy of our allowance for loan losses, changes in credit quality and the effect of credit quality on our provision for credit losses and allowance for loan losses; changes in governmental legislation or regulation, including, but not limited to, any increase in FDIC insurance premiums; changes in accounting policies and practices; changes in the deferred tax asset valuation allowance; changes in business strategy or development plans; changes in the securities markets; changes in consumer spending, borrowing and savings habits; the availability of capital from private or government sources; competition for loans and deposits and failure to attract or retain loans and deposits; changes in the financial performance and/or condition of our borrowers and the ability of our borrowers to perform under the terms of their loans and other terms of credit agreements; political instability, acts of war or terrorism and natural disasters; and additional "Risk Factors" referenced in the Company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, as supplemented from time to time. When relying on forward-looking statements to make decisions with respect to the Company, investors and others are cautioned to consider these and other risks and uncertainties. The Company can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. The forward-looking statements are made as of the date of this press release, and the Company does not intend, and assumes no obligation, to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.
GUARANTY BANCORP AND SUBSIDIARIES
Unaudited Consolidated Balance Sheets
June 30, December 31, June 30,
2010 2009 2009
----------- ----------- -----------
(In thousands)
Assets
Cash and due from banks $ 184,507 $ 234,483 $ 28,403
Federal funds sold 194 - 18,693
----------- ----------- -----------
Cash and cash equivalents 184,701 234,483 47,096
----------- ----------- -----------
Securities available for sale, at
fair value 281,215 221,134 97,461
Securities held to maturity 13,897 9,942 10,929
Bank stocks, at cost 17,181 17,160 16,562
----------- ----------- -----------
Total investments 312,293 248,236 124,952
----------- ----------- -----------
Loans, net of unearned discount 1,374,208 1,519,608 1,651,572
Less allowance for loan losses (46,866) (51,991) (43,041)
----------- ----------- -----------
Net loans 1,327,342 1,467,617 1,608,531
----------- ----------- -----------
Loans held for sale 1,150 9,862 5,250
Premises and equipment, net 58,799 60,267 61,903
Other real estate owned and
foreclosed assets 30,298 37,192 34,746
Other intangible assets, net 16,622 19,222 22,337
Other assets 52,593 50,701 40,052
----------- ----------- -----------
Total assets $ 1,983,798 $ 2,127,580 $ 1,944,867
=========== =========== ===========
Liabilities and Stockholders' Equity
Liabilities:
Deposits:
Noninterest-bearing demand $ 338,169 $ 366,103 $ 352,185
Interest-bearing demand 495,052 523,971 448,256
Savings 75,338 71,816 72,143
Time 635,712 731,400 688,146
----------- ----------- -----------
Total deposits 1,544,271 1,693,290 1,560,730
----------- ----------- -----------
Securities sold under agreements to
repurchase and federal funds
purchased 17,247 22,990 13,071
Borrowings 164,276 164,364 164,459
Subordinated debentures 41,239 41,239 41,239
Interest payable and other
liabilities 27,760 13,059 11,761
----------- ----------- -----------
Total liabilities 1,794,793 1,934,942 1,791,260
----------- ----------- -----------
Stockholders' equity:
Preferred stock and Additional
paid-in capital - Preferred stock 61,961 59,227 -
Common stock and Additional
paid-in capital - Common stock 618,996 618,408 617,664
Shares to be issued for deferred
compensation obligations 237 199 120
Accumulated deficit (391,548) (382,599) (362,424)
Accumulated other comprehensive
income (loss) 1,844 (143) 691
Treasury Stock (102,485) (102,454) (102,444)
----------- ----------- -----------
Total stockholders' equity 189,005 192,638 153,607
----------- ----------- -----------
Total liabilities and
stockholders' equity $ 1,983,798 $ 2,127,580 $ 1,944,867
=========== =========== ===========
GUARANTY BANCORP AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
2010 2009 2010 2009
---------- ---------- ---------- ----------
(In thousands, except share and per share
data)
Interest income:
Loans, including fees $ 19,449 $ 23,208 $ 40,233 $ 46,284
Investment securities:
Taxable 1,615 590 3,131 1,316
Tax-exempt 704 765 1,424 1,532
Dividends 182 198 367 486
Federal funds sold and
other 103 14 219 17
---------- ---------- ---------- ----------
Total interest income 22,053 24,775 45,374 49,635
---------- ---------- ---------- ----------
Interest expense:
Deposits 3,994 6,910 8,707 14,035
Securities sold under
agreement to repurchase
and federal funds
purchased 33 31 76 69
Borrowings 1,314 1,312 2,615 2,633
Subordinated debentures 579 662 1,211 1,320
---------- ---------- ---------- ----------
Total interest expense 5,920 8,915 12,609 18,057
---------- ---------- ---------- ----------
Net interest income 16,133 15,860 32,765 31,578
Provision for loan losses 8,400 18,605 12,400 21,110
---------- ---------- ---------- ----------
Net interest income,
after provision for
loan losses 7,733 (2,745) 20,365 10,468
Noninterest income:
Customer service and
other fees 2,254 2,354 4,468 5,033
Gain (loss) on sale of
securities 1 - 15 -
Gain on sale of loans 1,196 - 1,196 -
Other 274 277 468 492
---------- ---------- ---------- ----------
Total noninterest
income 3,725 2,631 6,147 5,525
Noninterest expense:
Salaries and employee
benefits 6,472 6,712 13,035 13,451
Occupancy expense 1,836 1,926 3,726 3,847
Furniture and equipment 967 1,147 1,943 2,278
Amortization of
intangible assets 1,300 1,581 2,600 3,163
Other real estate owned,
net 3,115 915 5,864 963
Insurance and assessments 1,825 2,195 3,637 3,236
Professional fees 739 896 1,616 1,745
Other general and
administrative 2,165 2,346 4,124 4,495
---------- ---------- ---------- ----------
Total noninterest
expense 18,419 17,718 36,545 33,178
---------- ---------- ---------- ----------
Loss before income
taxes (6,961) (17,832) (10,033) (17,185)
Income tax benefit (2,607) (6,975) (3,834) (6,764)
---------- ---------- ---------- ----------
Net loss (4,354) (10,857) (6,199) (10,421)
Preferred stock dividends (1,390) - (2,750) -
---------- ---------- ---------- ----------
Net loss applicable to
common stockholders $ (5,744) $ (10,857) $ (8,949) $ (10,421)
========== ========== ========== ==========
Loss per common
share-basic: $ (0.11) $ (0.21) $ (0.17) $ (0.20)
Loss per common
share-diluted: (0.11) (0.21) (0.17) (0.20)
Weighted average common
shares outstanding-basic 51,660,603 51,339,542 51,633,972 51,312,847
Weighted average common
shares outstanding-diluted 51,660,603 51,339,542 51,633,972 51,312,847
GUARANTY BANCORP AND SUBSIDIARIES
Unaudited Consolidated Average Balance Sheets
------------------------------------------------------
QTD Average YTD Average
-------------------------------- ---------------------
June 30, December June 30, June 30, June 30,
2010 31, 2009 2009 2010 2009
---------- ---------- ---------- ---------- ----------
(In thousands)
Assets
Interest earning
assets
Loans, net of
unearned discount $1,418,768 $1,578,761 $1,733,168 $1,455,494 $1,770,738
Securities 286,469 228,608 132,231 266,107 136,607
Other earning
assets 161,611 176,049 16,175 175,878 10,704
---------- ---------- ---------- ---------- ----------
Average earning
assets 1,866,848 1,983,418 1,881,574 1,897,479 1,918,049
Other assets 132,679 133,839 129,740 135,563 120,298
---------- ---------- ---------- ---------- ----------
Total average assets $1,999,527 $2,117,257 $2,011,314 $2,033,042 $2,038,347
========== ========== ========== ========== ==========
Liabilities and
Stockholders'
Equity
Average liabilities:
Average deposits:
Noninterest-bearing
deposits $ 352,171 $ 363,177 $ 410,517 $ 352,551 $ 421,239
Interest-bearing
deposits 1,218,176 1,320,410 1,203,107 1,249,972 1,215,108
---------- ---------- ---------- ---------- ----------
Average deposits 1,570,347 1,683,587 1,613,624 1,602,523 1,636,347
Other interest-
bearing liabilities 223,435 223,835 222,234 224,142 226,283
Other liabilities 14,045 11,979 10,472 13,576 11,294
---------- ---------- ---------- ---------- ----------
Total average
liabilities 1,807,827 1,919,401 1,846,330 1,840,241 1,873,924
Average
stockholders'
equity 191,700 197,856 164,984 192,801 164,423
---------- ---------- ---------- ---------- ----------
Total average
liabilities and
stockholders'
equity $1,999,527 $2,117,257 $2,011,314 $2,033,042 $2,038,347
========== ========== ========== ========== ==========
GUARANTY BANCORP
Unaudited Credit Quality Measures
Quarter Ended
------------------------------------------------
June 30, March 31, December September June 30,
2010 2010 31, 2009 30, 2009 2009
-------- -------- -------- -------- --------
(Dollars in thousands)
Nonaccrual loans and
leases, not
restructured $ 64,339 $ 70,500 $ 59,584 $ 81,035 $ 52,483
Other nonperforming loans 1,065 558 123 150 2,671
-------- -------- -------- -------- --------
Total nonperforming
loans $ 65,404 $ 71,058 $ 59,707 $ 81,185 $ 55,154
-------- -------- -------- -------- --------
Other real estate owned
and foreclosed assets 30,298 30,918 37,192 32,246 34,746
-------- -------- -------- -------- --------
Total nonperforming
assets $ 95,702 $101,976 $ 96,899 $113,431 $ 89,900
======== ======== ======== ======== ========
Impaired loans $ 65,404 $ 71,058 $ 59,707 $ 81,185 $ 55,154
Allocated allowance for
loan losses (3,716) (10,802) (6,603) (7,515) (7,291)
-------- -------- -------- -------- --------
Net investment in
impaired loans $ 61,688 $ 60,256 $ 53,104 $ 73,670 $ 47,863
======== ======== ======== ======== ========
Accruing loans past due
90 days or more $ 1,065 $ 558 $ 123 $ 9,140 $ 2,671
======== ======== ======== ======== ========
Accruing loans past due
30-89 days $ 33,050 $ 21,956 $ 21,709 $ 52,443 $ 39,836
======== ======== ======== ======== ========
Charged-off loans $ 13,918 $ 4,271 $ 7,618 $ 14,618 $ 13,509
Recoveries (369) (295) (566) (615) (347)
-------- -------- -------- -------- --------
Net charge-offs $ 13,549 $ 3,976 $ 7,052 $ 14,003 $ 13,162
======== ======== ======== ======== ========
Provision for loan loss $ 8,400 $ 4,000 $ 10,005 $ 20,000 $ 18,605
======== ======== ======== ======== ========
Allowance for loan
losses $ 46,866 $ 52,015 $ 51,991 $ 49,038 $ 43,041
======== ======== ======== ======== ========
Allowance for loan
losses to loans, net of
unearned discount 3.41% 3.62% 3.42% 3.09% 2.61%
Allowance for loan losses
to nonaccrual loans 72.84% 73.78% 87.26% 60.51% 82.01%
Allowance for loan losses
to nonperforming assets 48.97% 51.01% 53.65% 43.23% 47.88%
Allowance for loan losses
to nonperforming loans 71.66% 73.20% 87.08% 60.40% 78.04%
Nonperforming assets to
loans, net of unearned
discount, and other
real estate owned 6.81% 6.96% 6.22% 7.00% 5.33%
Nonperforming assets to
total assets 4.82% 5.02% 4.55% 5.51% 4.62%
Nonaccrual loans to
loans, net of unearned
discount 4.68% 4.91% 3.92% 5.11% 3.18%
Nonperforming loans to
loans, net of unearned
discount 4.76% 4.95% 3.93% 5.11% 3.34%
Annualized net
charge-offs to average
loans 3.83% 1.08% 1.77% 3.42% 3.05%
Contact Information: Contact: Daniel M. Quinn President & Chief Executive Officer 1331 Seventeenth Street, Suite 300 Denver, CO 80202 303/313-6763 Paul W. Taylor E.V.P., Chief Financial & Operating Officer & Secretary 1331 Seventeenth Street, Suite 300 Denver, CO 80202 303/293-5563