SAVANNAH, Ga., July 17, 2007 (PRIME NEWSWIRE) -- The Savannah Bancorp, Inc. (Nasdaq:SAVB) reported net income for the second quarter 2007 of $2,591,000, up 2.1 percent from $2,538,000 in the second quarter 2006. Net income per diluted share was 44 cents compared to 43 cents per diluted share in the second quarter of 2006, an increase of 2.3 percent. Second quarter 2007 earnings were up $280,000, or 12%, compared to first quarter 2007 earnings of $2,311,000. Prior period per share amounts have been restated to reflect the 5-for-4 stock split in December 2006.
Return on average equity was 14.94 percent, return on average assets was 1.23 percent and the efficiency ratio was 53.40 percent in the second quarter 2007.
Total assets increased 13 percent to $873 million at June 30, 2007, up $101 million from $772 million a year earlier. Loans, excluding loans held for sale, were $752 million compared to $657 million one year earlier, an increase of 14 percent. Deposits totaled $726 million and $642 million at June 30, 2007 and 2006, respectively, an increase of 13 percent.
John Helmken, President & CEO, said, "I am continually proud of the focus of our production teams, growing loans and deposits in excess of $95 million and $84 million, respectively, over the past year. During the current challenging interest rate and economic environment, it is a testament to the quality of our employees and customers that we have continued to produce above average loan growth while maintaining excellent credit quality. Our current and future success in growing our customer base, loans, deposits and the resulting earnings depends upon the retention and addition of exceptionally talented people who serve our customers well. We have been fortunate to enjoy a significant measure of success in these areas."
The Company continues to report nonperforming asset percentages and loan past dues that are better than industry averages. Nonperforming assets were $2,595,000 or 0.34 percent of total loans and other real estate at June 30, 2007 compared to $2,559,000 or 0.39 percent at June 30, 2006. Second quarter net credit losses were $98,000 for 2007 compared to net credit losses of $3,000 in the second quarter 2006. Provision for credit losses for the second quarter of 2007 was $395,000 compared to $360,000 for the second quarter of 2006. Net credit losses were $332,000 for the first six months of 2007 compared to net credit recoveries of $3,000 in the first six months of 2006. Provision for credit losses for the first six months of 2007 was $895,000 compared to $775,000 for the first six months of 2006.
For the first six months of 2007, net income was $4,902,000 versus $4,889,000 in the first six months of 2006. Earnings per diluted share were $0.83 in the first six months of 2007 and 2006. Return on average equity was 14.42 percent, return on average assets was 1.17 percent, net interest margin was 4.15 percent and the efficiency ratio was 54.58 percent in the first six months of 2007.
Net interest income increased 3.1 percent in the second quarter 2007 over the second quarter 2006. Second quarter net interest margin declined to 4.13 percent in 2007 from 4.51 percent in 2006 primarily due to higher funding costs. Noninterest income declined $86,000, or 7.9 percent in the first quarter of 2007 versus the same period in 2006 due to lower mortgage related income and lower service charges on deposit accounts. Noninterest expense increased $50,000 or 1.0 percent in the second quarter 2007 compared to the second quarter 2006. Higher personnel, occupancy, equipment and information technology costs were partially offset by lower other operating expenses.
Today, the Board of Directors approved a regular quarterly cash dividend of 12 cents per share payable on August 20, 2007 to shareholders of record on July 27, 2007.
The Savannah Bancorp, Inc. (SAVB), a bank holding company for The Savannah Bank, N.A., Bryan Bank & Trust (Richmond Hill, Georgia) and Harbourside Community Bank (Hilton Head Island, SC), is headquartered in Savannah, Georgia. SAVB began operations in 1990. Its primary businesses include deposit, credit, trust and mortgage origination services provided to local customers.
This press release may contain forward-looking statements as defined by federal securities law which involve significant risks and uncertainties. Actual results could differ materially from those contained in or implied by such statements for a variety of reasons including, but not limited to: changes in interest rates; changes in accounting principles, policies, or guidelines; significant changes in the economic scenario: significant changes in regulatory requirements; and significant changes in securities markets. The Savannah Bancorp, Inc. does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made. Any such statements are made in reliance on the safe harbor protections provided under the Private Securities Act of 1995.
The Savannah Bancorp, Inc. and Subsidiaries
Second Quarter Financial Highlights
June 30, 2007 and 2006
(Unaudited)
($ in thousands, except share data)
%
Balance Sheet Data at June 30 2007 2006 Change
---------------------------------------------------------------------
Total assets $872,664 $772,026 13
Interest-earning assets 829,589 734,420 13
Loans 752,328 657,128 14
Allowance for credit losses 9,517 8,591 11
Non-accruing loans 1,895 2,049 (7.5)
Loans past due 90 days - accruing 44 510 (91)
Other real estate owned 656 -- --
Deposits 726,013 642,393 13
Interest-bearing liabilities 706,804 606,828 16
Shareholders' equity 70,025 61,018 15
Allowance for credit losses to
total loans 1.27% 1.31% (3.1)
Nonperforming assets to total loans
and OREO 0.34% 0.39% (13)
Loan to deposit ratio 103.62% 102.29% 1.3
Equity to assets 8.02% 7.90% 1.5
Tier 1 capital to risk-weighted
assets 11.32% 11.47% (1.3)
Total capital to risk-weighted assets 12.57% 12.72% (1.2)
Book value per share (a) $ 12.00 $ 10.60 13
Outstanding shares (a) 5,834 5,759 1.3
Market value per share (a) $ 25.10 $ 30.26 (17)
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Performance Ratios for the Second Quarter
---------------------------------------------------------------------
Net income $ 2,591 $ 2,538 2.1
Return on average assets 1.23% 1.33% (7.5)
Return on average equity 14.94% 16.91% (12)
Net interest margin 4.13% 4.51% (8.4)
Efficiency ratio 53.40% 53.84% (0.8)
Per share data: (a)
Net income - basic $ 0.44 $ 0.44 --
Net income - diluted $ 0.44 $ 0.43 2.3
Dividends $ 0.120 $ 0.112 7.1
Average shares: (a)
Basic 5,824 5,759 1.1
Diluted 5,899 5,886 0.2
---------------------------------------------------------------------
Performance Ratios for the First Six Months
---------------------------------------------------------------------
Net income $ 4,902 $ 4,889 0.3
Return on average assets 1.17% 1.31% (11)
Return on average equity 14.42% 16.53% (13)
Net interest margin 4.15% 4.55% (8.8)
Efficiency ratio 54.58% 54.16% 0.8
Per share data: (a)
Net income - basic $ 0.84 $ 0.85 (0.4)
Net income - diluted $ 0.83 $ 0.83 --
Dividends $ 0.240 $ 0.224 7.1
Average shares: (a)
Basic 5,803 5,759 0.8
Diluted 5,895 5,890 0.1
(a) Share and per share amounts have been restated to reflect the
effect of a 5-for-4 stock split in December 2006.
The Savannah Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
June 30, 2007 and 2006
(Unaudited)
($ in thousands, except share data)
June 30,
---------------------------------------------------------------------
2007 2006
---------------------------------------------------------------------
Assets
Cash and due from banks $ 23,093 $ 19,413
Interest-bearing deposits 8,777 4,400
Federal funds sold 4,874 18,266
---------------------------------------------------------------------
Cash and cash equivalents 36,744 42,079
Securities available for sale, at fair
value (amortized cost of $64,379 in 2007
and $52,268 in 2006) 63,489 51,220
Loans held for sale 1,126 4,407
Loans, net of allowance for credit losses
of $9,517 in 2007 and $8,591 in 2006 742,811 648,537
Premises and equipment, net 6,198 5,714
Other real estate owned 656 --
Bank-owned life insurance 5,870 5,655
Other assets 15,770 14,414
---------------------------------------------------------------------
Total assets $872,664 $772,026
=====================================================================
Liabilities
Deposits:
Noninterest-bearing $ 89,098 $ 97,909
Interest-bearing demand 122,209 94,081
Savings 18,627 18,540
Money market 168,411 137,721
Time deposits 327,668 294,142
---------------------------------------------------------------------
Total deposits 726,013 642,393
Short-term borrowings 56,437 36,560
FHLB advances - long-term 3,142 15,474
Subordinated debt 10,310 10,310
Other liabilities 6,737 6,271
---------------------------------------------------------------------
Total liabilities 802,639 711,008
---------------------------------------------------------------------
Shareholders' equity
Common stock, par value $1 per share:
authorized 20,000,000 shares; issued
5,833,860 and 4,607,647 shares in 2007
and 2006, respectively 5,834 4,608
Preferred stock, par value $1 per share:
authorized 10,000,000 shares, none issued -- --
Additional paid-in capital 36,347 36,480
Retained earnings 29,189 21,870
Treasury stock, 318 and 267 shares in 2007
and 2006, respectively (4) (4)
Accumulated other comprehensive loss, net (1,341) (1,936)
---------------------------------------------------------------------
Total shareholders' equity 70,025 61,018
---------------------------------------------------------------------
Total liabilities and shareholders'
equity $872,664 $772,026
=====================================================================
The Savannah Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income
For the Six Months Ending June 30, 2007 and 2006
($ in thousands, except per share data)
----------------------------------------------------------------
(Unaudited)
----------------------------------------------------------------
For the Six Months Ended
----------------------------------------------------------------
June 30, %
2007 2006 Chg
----------------------------------------------------------------
Interest and dividend income
Loans, including fees $ 29,224 $ 24,269 20
Loans held for sale 69 441 (84)
Investment securities 1,346 1,068 26
Deposits with banks 201 102 97
Federal funds sold 296 275 7.6
--------------------------------------------------------
Total interest and dividend
income 31,136 26,155 19
--------------------------------------------------------
Interest expense
Deposits 12,571 8,336 51
Short-term borrowings 1,242 911 36
FHLB advances 319 444 (28)
Subordinated debt 416 389 6.9
--------------------------------------------------------
Total interest expense 14,548 10,080 44
--------------------------------------------------------
Net interest income 16,588 16,075 3.2
Provision for credit losses 895 775 15
--------------------------------------------------------
Net interest income after the
provision for credit losses 15,693 15,300 2.6
--------------------------------------------------------
Noninterest income
Service charges on deposits 695 753 (7.7)
Mortgage related income, net 376 482 (22)
Trust fees 365 325 12
Other operating income 617 599 3.0
--------------------------------------------------------
Total noninterest income 2,053 2,159 (4.9)
--------------------------------------------------------
Noninterest expense
Salaries and employee benefits 5,802 5,476 6.0
Occupancy and equipment 1,540 1,397 10
Information technology 806 736 10
Other operating expense 2,026 2,266 (11)
--------------------------------------------------------
Total noninterest expense 10,174 9,875 3.0
--------------------------------------------------------
Income before income taxes 7,572 7,584 (0.2)
Income tax expense 2,670 2,695 (0.9)
--------------------------------------------------------
Net income $ 4,902 $ 4,889 0.3
========================================================
Net income per share: (a)
Basic $ .84 $ .85 (1.2)
========================================================
Diluted $ .83 $ .83 --
========================================================
Average basic shares (000s) (a) 5,803 5,759 0.8
Average diluted shares (000s) (a) 5,895 5,890 0.1
Performance Ratios
Return on average equity 14.42% 16.53% (13)
Return on average assets 1.17% 1.31% (11)
Net interest margin 4.15% 4.55% (8.8)
Efficiency ratio 54.58% 54.16% (0.8)
Average equity 68,544 59,630 15
Average assets 845,071 750,955 13
Average interest-earning assets 810,525 716,342 13
The Savannah Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income
For the Five Quarters Ending June 30, 2007
---------------------------------------------------------------------
(Unaudited)
---------------------------------------------------------------------
2007 2006
---------------- -------------------------- Q2-07/
Second First Fourth Third Second Q2-06
Quarter Quarter Quarter Quarter Quarter %
---------------------------------------------------------------------
Interest and
dividend income
Loans, including
fees $ 14,872 $ 14,351 $ 14,063 $ 13,209 $ 12,548 19
Loans held for
sale 35 34 52 64 233 (85)
Investment
securities 726 620 599 572 559 30
Deposits with
banks 119 83 127 65 54 120
Federal funds
sold 125 172 116 166 148 (16)
--------------------------------------------------------------
Total interest
and dividend
income 15,877 15,260 14,957 14,076 13,542 17
--------------------------------------------------------------
Interest expense
Deposits 6,479 6,092 5,754 5,251 4,443 46
Short-term
borrowings 618 625 561 326 546 13
FHLB advances 155 164 168 166 197 (21)
Subordinated debt 213 203 214 214 200 6.5
--------------------------------------------------------------
Total interest
expense 7,465 7,084 6,697 5,957 5,386 39
--------------------------------------------------------------
Net interest
income 8,412 8,176 8,260 8,119 8,156 3.1
Provision for
credit losses 395 500 450 360 360 9.7
--------------------------------------------------------------
Net interest
income after the
provision for
credit losses 8,017 7,676 7,810 7,759 7,796 2.8
--------------------------------------------------------------
Noninterest
income
Service charges
on deposits 348 347 389 384 377 (7.7)
Mortgage related
income, net 166 210 200 203 252 (34)
Trust fees 189 176 170 164 166 14
Other operating
income 297 319 331 305 291 2.1
--------------------------------------------------------------
Total noninterest
income 1,000 1,052 1,090 1,056 1,086 (7.9)
--------------------------------------------------------------
Noninterest
expense
Salaries and
employee benefits 2,838 2,964 2,659 2,717 2,785 1.9
Occupancy and
equipment 782 758 768 755 746 4.8
Information
technology 381 425 417 372 374 1.9
Other operating
expense 1,025 1,000 1,293 1,101 1,071 (4.3)
--------------------------------------------------------------
Total noninterest
expense 5,026 5,147 5,137 4,945 4,976 1.0
--------------------------------------------------------------
Income before
income taxes 3,991 3,581 3,763 3,870 3,906 2.2
Income tax expense 1,400 1,270 1,240 1,280 1,368 2.3
--------------------------------------------------------------
Net income $ 2,591 $ 2,311 $ 2,523 $ 2,590 $ 2,538 2.1
==============================================================
Net income per
share: (a)
Basic $ .44 $ .40 $ .44 $ .45 $ .44 --
==============================================================
Diluted $ .44 $ .39 $ .43 $ .44 $ .43 2.3
==============================================================
Average basic
shares (000s) (a) 5,824 5,783 5,779 5,761 5,759 1.1
Average diluted
shares (000s) (a) 5,899 5,890 5,884 5,886 5,894 0.1
Performance Ratios
Return on average
equity 14.94% 13.90% 15.33% 16.46% 16.91% (12)
Return on average
assets 1.23% 1.12% 1.24% 1.34% 1.33% (7.5)
Net interest
margin 4.13% 4.17% 4.26% 4.42% 4.51% (8.4)
Efficiency ratio 53.40% 55.78% 54.94% 53.90% 53.84% .8
Average equity 69,583 67,434 65,297 62,435 60,195 16
Average assets 855,989 834,033 809,491 767,649 765,080 12
Average
interest-earning
assets 821,253 799,678 772,192 732,405 729,101 13
(a) Share and per share amounts have been restated to reflect the
effect of a 5-for-4 stock split in December 2006.
The Savannah Bancorp, Inc. & Subsidiaries
Loan Concentration Schedule
June 30, 2007 and December 31, 2006
% of % of % Dollar
($ in thousands) 6/30/07 Total 12/31/06 Total Change
---------------------------------------------------------------------
Non-residential real
estate
Owner-occupied $113,298 15 $ 90,848 13 25
Non owner-occupied 91,783 12 98,032 13 (6)
Construction 25,333 3 22,128 3 14
Commercial land and
lot development 39,104 5 35,610 5 10
-----------------------------------------------------------
Total non-residential
real estate 269,518 35 246,618 34 9
-----------------------------------------------------------
Residential real
estate
Owner-occupied -
1-4 family 79,440 11 87,965 12 (10)
Non owner-occupied -
1-4 family 106,408 14 (a)101,397 14 5
Construction 66,161 9 (a) 77,417 11 (15)
Residential land and
lot development 109,258 14 93,060 13 17
Home equity lines 40,655 5 40,794 6 0
-----------------------------------------------------------
Total residential
real estate 401,922 53 400,633 56 0
-----------------------------------------------------------
Total real estate
loans 671,440 89 647,251 90 4
Commercial 61,898 8 57,740 8 7
Consumer 19,585 3 16,624 2 18
Unearned fees, net (599) -- (693) -- (14)
-----------------------------------------------------------
Total loans, net of
unearned fees $752,324 100 $720,922 100 4.4
===========================================================
(a) -- includes a reclassification $33 million of completed
construction loans from the construction category to the non-owner
occupied 1-4 family category to conform to the June 30, 2007
presentation as required by regulatory guidelines.
During the first half of 2007, residential real estate loans have remained flat in total and non-residential real estate loans have increased by 9 percent. During 2006, decisions were made to de-emphasize construction loan growth as evidenced by the decline of 15 percent in the construction loan portfolio during 2007.
Commercial and residential land and lot development portfolios generally represent loans to experienced real estate developers and financially strong, long-term real estate investors who have the financial strength to service the debt during the slower real estate markets.
The Savannah Bancorp, Inc. and Subsidiaries
Average Balance Sheet and Rate/Volume Analysis -
Second Quarter, 2007 and 2006
Taxable-Equivalent
Average Balance Average Rate Interest (a)
------------------------------ ------------------
QTD QTD QTD QTD QTD QTD Vari-
2007 2006 2007 2006 2007 2006 Ance
---------------------------------------------------------------------
($ in thousands) (%) ($ in thousands)
Assets
Interest-bearing
$ 9,207 $ 4,545 5.18 4.77 deposits $ 119 $ 54 $ 65
Investments
56,757 48,609 5.01 4.35 - taxable 709 527 182
Investments
2,060 2,500 7.79 11.39 - non-taxable 40 71 (31)
Federal funds
9,408 12,188 5.33 4.87 sold 125 148 (23)
Loans held for
2,063 13,394 6.80 6.98 sale 35 233 (198)
741,758 647,865 8.05 7.77 Loans (b) 14,888 12,548 2,340
------------------ ------------------------
Total interest-
earning
821,253 729,101 7.77 7.47 assets 15,916 13,581 2,335
---------- ------------------------
Noninterest-
34,736 35,979 earning assets
------------------
$855,989 $765,080 Total assets
==================
Liabilities
and equity
Deposits
$120,092 $ 91,810 2.09 1.10 NOW accounts 625 252 373
Savings
18,799 19,901 1.02 1.01 accounts 48 50 (2)
Money market
162,397 129,841 4.41 3.52 accounts 1,784 1,138 646
CDs, $100M or
125,404 104,139 5.36 4.52 more 1,677 1,174 503
68,149 78,931 4.78 3.70 CDs, broker 812 728 84
Other time
121,831 104,675 5.05 4.22 deposits 1,533 1,101 432
------------------ ------------------------
Total interest-
bearing
616,672 529,297 4.21 3.37 deposits 6,479 4,443 2,036
FHLB advances
12,095 15,904 5.14 4.97 - long term 155 197 (42)
Short-term
48,122 43,962 5.14 4.98 borrowings 617 546 71
Subordinated
10,310 10,310 8.33 7.78 debt 214 200 14
------------------ ------------------------
Total interest-
bearing
687,199 599,473 4.36 3.60 liabilities 7,465 5,386 2,079
---------- ------------------------
Noninterest-
92,844 98,671 bearing deposits
6,363 6,741 Other liabilities
69,583 60,195 Shareholders' equity
------------------
Liabilities and
$855,989 $765,080 equity
==================
3.41 3.87 Interest rate spread
==========
4.13 4.51 Net interest margin
==========
Net interest
income $8,451 $8,195 $ 256
========================
$134,054 $129,628 Net earning assets
==================
$709,516 $627,968 Average deposits
==================
Average cost
3.66 2.84 of deposits
==========
Average loan to
105% 103% deposit ratio
==================
(a) The taxable equivalent adjustment results from tax exempt income
less non-deductible TEFRA interest expense and was $39 in the
second quarter 2007 and 2006.
(b) Average nonaccruing loans have been excluded from total average
loans and categorized in noninterest-earning assets.
The Savannah Bancorp, Inc. and Subsidiaries
Average Balance Sheet and Rate/Volume Analysis -
First Six Months 2007 and 2006
Taxable-Equivalent
Average Balance Average Rate Interest (a)
------------------------------ ------------------
YTD YTD YTD YTD YTD YTD Vari-
2007 2006 2007 2006 2007 2006 Ance
---------------------------------------------------------------------
($ in thousands) (%) ($ in thousands)
Assets
Interest-bearing
$ 7,710 $ 4,458 5.26 4.61 deposits $ 201 $ 102 $ 99
Investments
53,986 46,623 4.91 4.32 - taxable 1,314 998 316
Investments
2,000 2,717 7.86 11.13 - non-taxable 78 150 (72)
11,309 11,774 5.28 4.71 Federal funds sold 296 275 21
Loans held
1,859 13,033 7.48 6.82 for sale 69 441 (372)
733,661 637,737 8.04 7.67 Loans (b) 29,256 24,269 4,987
------------------ ---------------------
Total interest-
810,525 716,342 7.77 7.39 earning assets 31,214 26,235 4,979
---------- ---------------------
Noninterest-
34,546 34,613 earning assets
------------------
$845,071 $750,955 Total assets
==================
Liabilities
and equity
Deposits
$114,642 $ 90,116 2.05 1.08 NOW accounts 1,167 483 684
18,596 19,890 1.01 0.99 Savings accounts 93 98 (5)
Money market
156,181 129,004 4.34 3.32 accounts 3,359 2,123 1,236
CDs, $100M or
121,312 98,089 5.30 4.33 more 3,189 2,106 1,083
74,090 84,807 4.81 3.61 CDs, broker 1,768 1,519 249
Other time
120,588 99,546 5.01 4.07 deposits 2,995 2,007 988
------------------ ---------------------
Total interest-
bearing
605,409 521,452 4.19 3.22 deposits 12,571 8,336 4,235
FHLB advances
12,680 18,160 5.07 4.93 - long term 319 444 (125)
Short-term
48,734 37,795 5.14 4.86 borrowings 1,242 911 331
10,310 10,310 8.14 7.61 Subordinated debt 416 389 27
------------------ ---------------------
Total interest-
bearing
677,133 587,717 4.33 3.46 liabilities 14,548 10,080 4,468
---------- ---------------------
Noninterest-
92,988 96,050 bearing deposits
6,406 7,558 Other liabilities
68,544 59,630 Shareholders' equity
------------------
Liabilities
$845,071 $750,955 and equity
==================
3.44 3.93 Interest rate spread
==========
4.15 4.55 Net interest margin
==========
Net interest
income $16,666 $16,155 $ 511
======================
$133,392 $128,625 Net earning assets
==================
$698,397 $617,502 Average deposits
==================
Average cost
3.63 2.72 of deposits
==========
Average loan to
105% 103% deposit ratio
==================
(a) The taxable equivalent adjustment results from tax exempt income
less non-deductible TEFRA interest expense and was $78 and $80 in
the first six months 2007 and 2006, respectively.
(b) Average nonaccruing loans have been excluded from total average
loans and categorized in noninterest-earning assets.