LAKE HAVASU CITY, Ariz., Feb. 12, 2010 (GLOBE NEWSWIRE) -- State Bank Corp. (OTCBB:SBAZ) ("Company"), the holding company for Mohave State Bank ("Bank"), announced a net operating loss of $356,000, or $0.09 per diluted share, for the fourth quarter of 2009 as compared to a net operating loss of $594,000, or $0.15 per diluted share, for the same period of 2008. The Company ended 2009 with a net operating loss of $2.1 million, or $0.55 per diluted share, as compared to net income of $2.3 million, or $0.61 per diluted share, for 2008.
Fourth quarter 2009 highlights include:
- Continued growth in deposits – The Company experienced a $5.2 million, or 1.7 percent, increase in deposits during the fourth quarter of 2009. During 2009, total deposits increased $48.4 million, or 18.4 percent.
- Reduction in FHLB borrowing – The Company retired another $2.0 million, or 22.2 percent, of its remaining advances from the Federal Home Loan Bank during the past quarter. During 2009, the Company retired $37.1 million, or 84.1 percent of its total FHLB borrowing.
- Improvement in primary liquidity measures – Continued deposit growth and moderation in lending have reduced the Company's loan to deposit ratio to 81.6 percent at December 31, 2009 from a peak of 109.3 percent at December 31, 2008.
- Improvement in asset quality – The nonperforming asset ratio decreased to 7.02 percent in the fourth quarter of 2009 from 8.40 percent in the third quarter of 2009 as both nonaccrual loans and other real estate owned decreased.
"We continue to make progress during these challenging times. Properties held as OREO are beginning to sell and our problem credits show some signs of stabilization. We were able to add additional capital during the last quarter to strengthen our capital base going forward," commented Brian M. Riley, Chief Executive Officer.
The Company provided $1.25 million to its loan loss reserve during the fourth quarter of 2009 as compared to $3.0 million in the same period of 2008. During 2009, the Company provided $7.4 million to its loan loss reserve as compared to $4.5 million in 2008. Net credit losses during 2009 totaled $5.8 million as compared to $709,000 during 2008.
"Credit losses and OREO costs totaled nearly $9.5 million in 2009. We are fortunate to have the earnings capacity to resolve many of these credit issues without impairing our capital," stated Brad D. Payne, President.
Total assets were $373.8 million at December 31, 2009, an increase of $13.0 million, or 3.6 percent, from $360.8 million at December 31, 2008. Total loans decreased by $33.6 million, or 11.7 percent, to $254.2 million at December 31, 2009 from $287.3 million at December 31, 2008. Approximately $20 million of the decrease resulted from loans being transferred to other real estate owned following foreclosure proceedings.
Nonperforming assets were $26.2 million at December 31, 2009, or 7.0 percent of total assets, as compared to $19.9 million, or 5.5 percent of total assets, at December 31, 2008. The allowance for loan and lease losses totaled $8.9 million, or 3.5 percent of total loans, at December 31, 2009 as compared to $7.4 million, or 2.6 percent of total loans, at December 31, 2008. The Company continues to carefully monitor its level of loss reserves given a weak economic environment.
Deposits at December 31, 2009 were $311.7 million, an increase $48.4 million, or 18.4 percent, from $263.3 million at December 31, 2008. The Company continues to experience core customer growth and a consumer preference toward the safety of insured bank deposits.
Shareholder equity was $34.3 million at December 31, 2009, down from $36.2 million at December 31, 2008. The Bank must meet certain minimum capital requirements to satisfy federal and state laws. The following table provides the Bank's capital ratio at December 31, 2009:
|
Actual Ratio |
Ratio to be adequately capitalized |
Ratio to be well capitalized |
|
| Leverage Ratio | 9.10% | 4.00% | 5.00% |
| Tier 1 Capital to Risk-Weighted Assets | 11.40% | 4.00% | 6.00% |
| Total Capital to Risk-Weighted Assets | 12.70% | 8.00% | 10.00% |
As an abundance of caution, the Company recently completed a subordinated debt issue raising commitments for $1.7 million in new funding.
On February 8, 2010, Mohave State Bank entered into a Consent Order with the Federal Deposit Insurance Corporation (FDIC) and the Arizona Department of Financial Institutions (ADFI) as a result of an examination that occurred in June 2009. Among other matters, the Consent Order requires the Bank to maintain a Tier 1 leverage ratio of 9.25 percent and a total risk-based capital ratio of 12 percent. While the Consent Order requires improvement in areas such as asset quality, liquidity and management oversight, it is the belief of the Bank that several actions taken during the last half of 2009 resulted in improvements that bring the Bank in compliance with many requirements of the Consent Order. In addition, any future payments to shareholders must receive prior regulatory approval.
About the Company
State Bank Corp., headquartered in Lake Havasu City, Arizona, is the parent company of Mohave State Bank, the largest locally-owned bank in Mohave County. Mohave State Bank is a full-service bank providing deposit and loan products, and convenient on-line banking to individuals, businesses and professionals. The Bank was established in October 1991, and the holding company was formed in 2004. The Bank has six full-service branches: two in Lake Havasu City, two in Kingman, one in Bullhead City, and one in Yuma, Arizona. The Company is traded over-the-counter as SBAZ. For further information, please visit the web site: www.mohavestbank.com.
Forward-looking Statements
This press release may include forward-looking statements about State Bank Corp. and its subsidiary, Mohave State Bank, for which the Company claims the protection of safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management's knowledge and belief as of today and include information concerning the Company's possible or assumed future financial condition, and its results of operations and business. Forward-looking statements are subject to risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, government policies and regulations (including monetary and fiscal policies), legislation, economic conditions, borrower capacity to repay, operational factors and competition in the geographic and business areas in which the Company conducts its operations. All forward-looking statements included in this press release are based on information available at the time of the release, and the Company assumes no obligation to update any forward-looking statement.
| State Bank Corp. | |||||
| Five-Quarter Performance Summary | |||||
| For the Quarter Ended | |||||
| Dollars in thousands - Unaudited | 12/31/2009 | 9/30/2009 | 6/30/2009 | 3/31/2009 | 12/31/2008 |
| Performance Highlights | |||||
| Earnings: | |||||
| Total revenue (Net int. income + nonint. income) | $ 3,749 | $ 3,659 | $ 3,859 | $ 3,668 | $ 4,070 |
| Net interest income | $ 3,290 | $ 3,165 | $ 3,267 | $ 3,169 | $ 3,630 |
| Provision for loan losses | $ 1,250 | $ 600 | $ 2,900 | $ 2,600 | $ 3,000 |
| Noninterest income | $ 459 | $ 494 | $ 592 | $ 499 | $ 440 |
| Noninterest expense | $ 3,744 | $ 2,690 | $ 2,421 | $ 2,690 | $ 2,352 |
| Net income (loss) | $ (356) | $ 236 | $ (950) | $ (1,037) | $ (594) |
| Per Share Data: | |||||
| Net income (loss), basic | $ (0.09) | $ 0.06 | $ (0.25) | $ (0.27) | $ (0.15) |
| Net income (loss), diluted | $ (0.09) | $ 0.06 | $ (0.25) | $ (0.27) | $ (0.15) |
| Cash dividends declared | $ -- | $ -- | $ -- | $ -- | $ 0.10 |
| Book value | $ 8.91 | $ 9.07 | $ 8.86 | $ 9.21 | $ 9.42 |
| Tangible book value | $ 8.91 | $ 9.07 | $ 8.86 | $ 9.21 | $ 9.42 |
| Performance Ratios: | |||||
| Return on average assets | -0.38% | 0.25% | -1.04% | -1.13% | -0.65% |
| Return on average equity | -4.10% | 2.74% | -11.13% | -11.53% | -6.47% |
| Net interest margin, taxable equivalent | 4.01% | 3.87% | 4.01% | 3.81% | 4.34% |
| Average cost of funds | 1.54% | 1.70% | 1.76% | 1.82% | 1.98% |
| Average yield on loans | 6.41% | 6.26% | 6.07% | 5.82% | 6.44% |
| Efficiency ratio | 99.87% | 74.14% | 63.18% | 72.68% | 57.79% |
| Non-interest income to total revenue | 12.24% | 13.50% | 15.34% | 13.60% | 10.81% |
| Capital & Liquidity: | |||||
| Total equity to total assets (EOP) | 9.20% | 9.36% | 9.51% | 9.74% | 10.04% |
| Tangible equity to tangible assets | 9.20% | 9.36% | 9.51% | 9.74% | 10.04% |
| Total loans to total deposits | 81.55% | 83.87% | 93.14% | 100.63% | 109.29% |
| Mohave State Bank | |||||
| Tier 1 leverage ratio | 9.07% | 9.05% | 9.15% | 9.41% | 9.63% |
| Tier 1 risk based capital | 11.41% | 11.12% | 10.87% | 10.94% | 11.16% |
| Total risk based capital | 12.68% | 12.39% | 12.13% | 12.20% | 12.42% |
| Asset Quality: | |||||
| Gross charge-offs | $ 1,244 | $ 813 | $ 1,085 | $ 2,793 | $ 360 |
| Net charge-offs (NCOs) | $ 1,128 | $ 813 | $ 1,085 | $ 2,791 | $ 360 |
| NCO to average loans, annualized | 1.76% | 1.24% | 1.56% | 3.89% | 0.49% |
| Non-accrual loans | $ 6,698 | $ 9,846 | $ 12,913 | $ 22,984 | $ 17,151 |
| Other real estate owned | $ 19,501 | $ 21,465 | $ 16,936 | $ 5,085 | $ 2,765 |
| Repossessed assets | $ 50 | $ 50 | $ 50 | $ -- | $ -- |
| Non-performing assets (NPAs) | $ 26,249 | $ 31,361 | $ 29,899 | $ 28,069 | $ 19,916 |
| NPAs to total assets | 7.03% | 8.40% | 8.33% | 7.71% | 5.52% |
| Loans >90 days past due | $ 523 | $ 3,221 | $ 5,195 | $ -- | $ -- |
| NPAs + 90 days past due | $ 26,772 | $ 34,582 | $ 35,094 | $ 28,069 | $ 19,916 |
| NPAs + loans 90 days past due to total assets | 7.17% | 9.26% | 9.78% | 7.71% | 5.52% |
| Allowance for loan losses to total loans | 3.50% | 3.42% | 3.33% | 2.51% | 2.56% |
| Allowance for loan losses to NPAs | 33.93% | 28.01% | 30.09% | 25.59% | 37.03% |
| Period End Balances: | |||||
| Assets | $ 373,143 | $ 373,290 | $ 358,916 | $ 363,860 | $ 360,814 |
| Total Loans (before reserves) | $ 254,188 | $ 257,059 | $ 269,611 | $ 285,874 | $ 287,784 |
| Deposits | $ 311,714 | $ 306,485 | $ 289,467 | $ 284,098 | $ 263,312 |
| Stockholders' equity | $ 34,312 | $ 34,924 | $ 34,134 | $ 35,430 | $ 36,228 |
| Common stock market capitalization | $ 13,483 | $ 12,520 | $ 24,076 | $ 30,190 | $ 46,150 |
| Full-time equivalent employees | 80 | 80 | 78 | 85 | 93 |
| Shares outstanding | 3,852,199 | 3,852,199 | 3,852,199 | 3,845,808 | 3,845,808 |
| Average Balances: | |||||
| Assets | $ 379,442 | $ 374,297 | $ 366,362 | $ 367,340 | $ 367,079 |
| Earning assets | $ 336,009 | $ 335,828 | $ 334,335 | $ 342,036 | $ 342,258 |
| Total Loans (before reserves) | $ 256,326 | $ 261,220 | $ 277,385 | $ 286,918 | $ 292,292 |
| Deposits | $ 314,279 | $ 302,011 | $ 287,523 | $ 280,841 | $ 255,843 |
| Other borrowings | $ 28,195 | $ 36,739 | $ 42,413 | $ 49,654 | $ 73,211 |
| Stockholders' equity | $ 34,760 | $ 34,488 | $ 34,134 | $ 36,002 | $ 36,718 |
| Shares outstanding, basic - wtd | 3,852,199 | 3,852,199 | 3,851,567 | 3,845,808 | 3,845,808 |
| Shares outstanding, diluted - wtd | 3,854,714 | 3,855,003 | 3,855,806 | 3,864,126 | 3,859,688 |
| State Bank Corp. | ||
| Balance Sheets | ||
| Dollars in thousands - Unaudited | 12/31/2009 | 12/31/2008 |
| Consolidated Balance Sheets | ||
| Assets | ||
| Cash and cash equivalents | $ 5,202 | $ 4,265 |
| Fed funds sold | 21,000 | -- |
| Held for maturity securities | 1,086 | 1,909 |
| Available for sale securities | 54,740 | 47,507 |
| Total cash and securities | 82,028 | 53,681 |
| Loans held for sale, before reserves | 1,762 | 1,329 |
| Gross loans held for investment | 252,426 | 285,949 |
| Loan loss reserve | (8,907) | (7,374) |
| Total net loans | 245,281 | 279,904 |
| Premises and equipment, net | 11,218 | 11,348 |
| Other real estate owned | 19,501 | 2,765 |
| Federal Home Loan Bank and other stock | 3,158 | 3,158 |
| Company owned life insurance | 5,147 | 4,961 |
| Other assets | 6,810 | 4,996 |
| Total Assets | $ 373,143 | $ 360,813 |
| Liabilities | ||
| Non interest bearing demand | $ 38,409 | $ 41,553 |
| Money market, NOW and savings | 126,416 | 107,626 |
| Time deposits <$100K | 69,915 | 76,306 |
| Time deposits >$100K | 76,974 | 37,827 |
| Total Deposits | 311,714 | 263,312 |
| Securities sold under repurchase agreements | 17,940 | 15,678 |
| Federal Home Loan Bank advances | 7,000 | 44,100 |
| Subordinated debt | 1,112 | -- |
| Total Debt | 26,052 | 59,778 |
| Other Liabilities | 1,065 | 1,495 |
| Total Liabilities | 338,831 | 324,585 |
| Shareholders' Equity | ||
| Common stock | 21,644 | 21,527 |
| Accumulated retained earnings | 12,009 | 14,116 |
| Accumulated other comprehensive income | 659 | 585 |
| Total shareholders equity | 34,312 | 36,228 |
| Total liabilities and shareholders' equity | $ 373,143 | $ 360,813 |
| State Bank Corp. | ||||
| Statement of Operations | ||||
| For the Quarter Ended | Year to Date | |||
| Dollars in thousands - Unaudited | 12/31/2009 | 12/31/2008 | 12/31/2009 | 12/31/2008 |
| Statements of Operations | ||||
| Interest income | ||||
| Loans, including fees | $ 4,108 | $ 4,703 | $ 16,576 | $ 19,881 |
| Securities | 488 | 535 | 1,986 | 2,303 |
| Fed funds and other | 16 | 23 | 35 | 131 |
| Total interest income | 4,612 | 5,261 | 18,597 | 22,315 |
| Interest expense | ||||
| Deposits | 1,205 | 1,290 | 5,041 | 5,869 |
| Borrowings | 117 | 341 | 671 | 1,347 |
| Total interest expense | 1,322 | 1,631 | 5,712 | 7,216 |
| Net interest income | 3,290 | 3,630 | 12,885 | 15,099 |
| Provision for loan losses | 1,250 | 3,000 | 7,350 | 4,470 |
| Net interest income after loan loss provision | 2,040 | 630 | 5,535 | 10,629 |
| Noninterest income | ||||
| Service charges on deposits | 179 | 201 | 699 | 731 |
| Mortgage loan fees | 17 | (3) | 67 | 134 |
| Gain on sale of loans | 134 | 150 | 850 | 676 |
| Other income | 129 | 92 | 428 | 396 |
| Total noninterest income | 459 | 440 | 2,044 | 1,937 |
| Noninterest expense | ||||
| Salaries and employee benefits | 1,174 | 1,176 | 4,860 | 5,018 |
| Net occupancy expense | 103 | 94 | 357 | 435 |
| Equipment expense | 60 | 66 | 257 | 284 |
| Data processing | 309 | 309 | 1,245 | 1,340 |
| Director fees & expenses | 72 | 100 | 276 | 441 |
| Insurance | 11 | 20 | 78 | 62 |
| Marketing & promotion | 114 | 175 | 412 | 557 |
| Professional fees | 95 | 146 | 341 | 284 |
| Office expense | 65 | 60 | 247 | 266 |
| Regulatory assessments | 233 | 60 | 848 | 194 |
| OREO and repossessed assets | 1,420 | -- | 2,189 | -- |
| Other expenses | 88 | 146 | 409 | 457 |
| Total noninterest expense | 3,744 | 2,352 | 11,519 | 9,338 |
| Income (loss) before provision (benefit) for income taxes | (1,245) | (1,282) | (3,940) | 3,228 |
| Provision (benefit) for income taxes | (889) | (688) | (1,833) | 892 |
| Net Income (Loss) | $ (356) | $ (594) | $ (2,107) | $ 2,336 |
| Per Share Data | ||||
| Basic EPS | $ (0.09) | $ (0.15) | $ (0.55) | $ 0.61 |
| Diluted EPS | $ (0.09) | $ (0.15) | $ (0.55) | $ 0.61 |
| Average shares outstanding | ||||
| Basic | 3,852,199 | 3,845,808 | 3,850,466 | 3,841,167 |
| Effect of dilutive shares | 2,515 | 13,880 | 5,435 | 14,090 |
| Diluted | 3,854,714 | 3,859,688 | 3,855,901 | 3,855,257 |