First National Bank of Northern California Reports First Quarter 2013 Earnings of $0.20 per Diluted Share
SOUTH SAN FRANCISCO, CA–(Marketwired – Apr 29, 2013) – FNB Bancorp (OTCQB: FNBG), parent company of First National Bank of Northern California (the “Bank”), today announced net earnings available to common shareholders for the first quarter of 2013 of $772,000 or $0.20 per diluted share, compared to net earnings available to common shareholders of $1,102,000 or $0.30 per diluted share for the first quarter of 2012. Dividend payments on the preferred shares outstanding were made as required by the Treasury Department’s Small Business Lending Program. Total assets as of March 31, 2013 were $897,478,000 compared to $746,649,000 as of March 31, 2012. Our net loans increased by $98,976,000 or 22.1% year over year. Our deposits increased by $138,734,000 or 21.3% during the same period. At March 31, 2013, the Company had considerable liquid assets on hand as evidenced by $246,460,000 in available for sale securities and $39,092,000 in cash and cash equivalents.
“During the first quarter of 2013, the Board of Directors approved the closure of our island of Guam office. This office was acquired by the Company in our acquisition of Oceanic Bank that was completed in September 2012. Alternatives to closure, such as a sale to another financial institution, either in whole or in part, were explored. After a considerable due diligence period, the Company was not able to find a suitable buyer and a tentative closure date of June 14, 2013 was established. In connection with the closure of our office on the island of Guam, during the month of March 2013, an accrued ‘Stay Bonus’ for all the employees of the Guam office was established totaling $78,000. Additionally, an occupancy accrual for the cost of the Guam branch lease through December 31, 2013, the end of the lease term, of $176,000 was also recorded. Together, the cost of employee severance and the cost to accelerate the expense of the Guam lease was $254,000 and this expense is reflected in our 1(st) quarter, 2013 operating expenses. The Company intends to retain the loan relationships as well as the Certificate of Deposit customers through their maturity date, and will service those customers from our San Francisco locations, but the checking and savings deposit account holders will not be retained. Overall, the closure of the Guam branch will allow the Company to concentrate our efforts on our operations in San Francisco and on the peninsula,” stated Tom McGraw, Chief Executive Officer.
“Our loan portfolio, investment portfolio and deposit portfolio all experienced growth during the first quarter of 2013. Overall, our assets and our deposits grew by 3% during the quarter. Our stockholders’ equity increased during the first quarter as well. As we continue to integrate the Oceanic Bank purchase into the operations of the Company, we should begin to realize additional operational efficiencies. Controlling expenses is a management priority in the near term. Our tax equivalent net interest margin decreased by 3 basis points during the first quarter of 2013 compared to the fourth quarter of 2012. The low interest rate environment currently supported by the Federal Open Market Committee of the Federal Reserve Bank has made it difficult for community banks to maintain net interest margin. In order to offset declines experienced in the yield of our earning assets, management has reduced the interest rates we pay our deposit customers. Further declines in our net interest margin in the near term are likely. We are doing everything that we can to effectively manage our balance sheet in this low interest rate environment,” continued Mr. McGraw.
“The quality of our loan portfolio continued to improve during the first quarter of 2013. Our total loans past due have declined since December 31, 2012 while at the same time we have increased our allowance for loan losses. Our allowance for loan losses coupled with our non-accreteable discount on purchased impaired loans was 1.7% of our outstanding loans as of March 31, 2013. We continue efforts to work with our borrowers that have experienced difficulty in making their loan payments towards the goal of finding solutions that are mutually beneficial to both our customers and the Company. We want the communities in which we live and do business to grow and prosper, and we take pride in doing our very best to help make that possible,” stated Mr. McGraw.
Financial Highlights: First Quarter, 2013 Consolidated Three Three Three Three Statements of months months months months Earnings ended ended ended ended (in '000s except March March earnings per share 31, Dec 31, 31, Dec 31, amounts) 2013 2012 2012 2011 -------- -------- -------- -------- Interest income $ 9,348 $ 9,408 $ 7,882 $ 8,167 Interest expense 682 727 684 744 ------- ------- ------- ------- Net interest income 8,666 8,681 7,198 7,423 Provision for loan losses 600 633 400 450 Noninterest income 1,025 1,119 1,920 1,310 Noninterest expense 7,739 7,557 7,053 6,771 ------- ------- ------- ------- Interest before income taxes 1,352 1,610 1,665 1,512 Provision for income taxes 422 264 377 427 ------- ------- ------- ------- Net earnings 930 1,346 1,288 1,085 Dividends and discount accretion on preferred stock 158 157 186 - ------- ------- ------- ------- Net earnings available to common stockholders $ 772 $ 1,189 $ 1,102 $ 1,085 ======= ======= ======= ======= Basic earnings per share $ 0.21 $ 0.32 $ 0.30 $ 0.29 Diluted earnings per share $ 0.20 $ 0.32 $ 0.30 $ 0.29 Average assets $893,982 $900,571 $735,438 $729,771 Average equity $ 95,378 $ 95,206 $ 87,878 $ 85,682 Return on average assets (annualized) 0.35% 0.53% 0.60% 0.59% Return on average equity (annualized) 3.24% 5.00% 5.02% 5.07% Efficiency ratio 80% 77% 77% 78% Net interest margin (taxable equivalent) 4.52% 4.55% 4.61% 4.46% Average shares outstanding 3,714 3,693 3,686 3,685 Average diluted shares outstanding 3,807 3,774 3,726 3,708 Consolidated Balance As of As of As of As of Sheets March 31, Dec 31, March 31, Dec 31, (in '000s) 2013 2012 2012 2011 ---------- ---------- ---------- ---------- Assets: Cash and cash equivalents $ 39,092 $ 27,861 $ 45,118 $ 38,474 Interest-bearing time deposits with other financial institutions 9,713 13,216 - - Securities available for sale, at fair value 246,460 234,945 205,353 187,664 Loans, net 546,278 541,563 447,302 443,721 Premises, equipment and leasehold improvements, net 12,634 12,706 13,042 13,227 Other real estate owned, net 6,668 6,650 1,920 2,747 Goodwill 1,841 1,841 1,841 1,841 Other equity securities 5,338 5,464 4,580 4,608 Accrued inrterest receivable 3,751 3,760 3,577 3,614 Prepaid expenses 1,116 1,372 1,844 2,107 Bank owned life insurance 11,880 11,785 11,491 9,521 Other assets 12,707 14,177 10,581 8,117 --------- --------- --------- --------- Total assets $ 897,478 $ 875,340 $ 746,649 $ 715,641 ========= ========= ========= ========= Liabilities and stockholders' equity: Deposits: Demand and NOW $ 255,511 $ 253,849 $ 216,195 $ 202,690 Savings and money market 372,112 343,437 327,592 310,237 Time 162,802 171,066 107,904 108,851 --------- --------- --------- --------- Total deposits 790,425 768,352 651,691 621,778 Accrued expenses and other liabilities 11,184 11,630 7,068 6,667 --------- --------- --------- --------- Total liabilities 801,609 779,982 658,759 628,445 Stockholders' equity 95,869 95,358 87,890 87,196 --------- --------- --------- --------- Total liab. and stockholders' equity $ 897,478 $ 875,340 $ 746,649 $ 715,641 ========= ========= ========= ========= Other Financial Information Allowance for loan losses $ 9,357 $ 9,124 $ 8,287 $ 9,897 Nonperforming assets $ 19,459 $ 19,142 $ 21,391 $ 12,684 Total gross loans $ 555,635 $ 550,687 $ 455,589 $ 453,618 Common shares
outstanding 3,738,000 3,699,000 3,683,000 3,681,000
Cautionary Statement: This release contains certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those stated herein. Management’s assumptions and projections are based on their anticipation of future events and actual performance may differ materially from those projected. Risks and uncertainties which could impact future financial performance include, among others, (a) competitive pressures in the banking industry; (b) changes in the interest rate environment; (c) general economic conditions, either nationally or regionally or locally, including fluctuations in real estate values; (d) changes in the regulatory environment; (e) changes in business conditions or the securities markets and inflation; (f) possible shortages of gas and electricity at utility companies operating in the State of California, and (g) the effects of terrorism, including the events of September 11, 2001, and thereafter, and the conduct of war on terrorism by the United States and its allies. Therefore, the information set forth herein, together with other information contained in the periodic reports filed by FNB Bancorp with the Securities and Exchange Commission, should be carefully considered when evaluating its business prospects. FNB Bancorp undertakes no obligation to update any forward-looking statements contained in this release.
Contacts:
Tom McGraw
Chief Executive Officer
(650) 875-4864
Dave Curtis
Chief Financial Officer
(650) 875-4862
Website: www.fnbnorcal.com
{source Wall Street Journal}
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