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SOURCE: Granite Community Bank, N.A.
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August 06, 2008 20:00 ET
Granite Bancshares, Inc. Announces Second Quarter Results for Granite Community Bank, N.A.
GRANITE BAY, CA--(Marketwire - August 6, 2008) - Granite Bancshares, Inc. (OTCBB: GBSI)
today announced results for the quarter ended June 30, 2008 for its wholly
owned subsidiary Granite Community Bank, N.A. (the "Company").
Net income for the three months ended June 30, 2008 increased $241 thousand
or 73% to $572 thousand, compared to net income of $331 thousand in the
second quarter of 2007. Earnings per diluted share increased 75% to $0.42
in the second quarter of 2008, compared to $0.23 in the second quarter of
2007. Net income during the period was positively impacted by a
non-recurring event. The Company was the beneficiary of proceeds under an
insurance policy. Without the impact of this non-recurring event, the net
income for the period would have been $40 thousand or $0.03 per share; this
is a decrease of $201 thousand or 94% from the same period in the prior
year.
Net income for the six months ended June 30, 2008 increased $95 thousand or
14% to $778 thousand, compared to net income of $683 thousand for the six
months ended June 30, 2007. Earnings per diluted share increased 17% to
$0.56 for the six months ended June 30, 2008, compared to $0.48 for the six
months ended June 30, 2007. Without the impact of the non-recurring event
as described earlier, the net income for the period would have been $246
thousand or $0.18 per fully diluted share.
Net interest income was $1.43 million and $2.81 million in the second
quarter and first six months of 2008, respectively, compared to $1.68
million and $3.33 million for the same periods in 2007. The net interest
margin for the second quarter and first six months of 2008 was 3.73% and
3.81%, respectively. This is a decrease of 88 basis points and 86
basis points compared to the same periods in 2007. Decreases in market
rates in 2008 have contributed to a decrease in the Company's yield on
earning assets by 168 basis points in the second quarter of 2008 compared
to 2007 and a decrease of 138 basis points for the six months ended June
30, 2008 compared to the same period in 2007. Partially offsetting the drop
in earning asset yields were decreases in the Company's cost of funds. The
cost of funds decreased 79 basis points to 2.39% in the second quarter of
2008 compared to 3.18% in 2007 and 47 basis points to 2.65% for the six
months ended June 30, 2008 compared to 3.12% in 2007.
Non-interest income increased $529 thousand or 490% in the second quarter
of 2008, compared to the second quarter of 2007. For the six months ended
June 30, 2008 non-interest income increased $464 thousand or 170% compared
to the same period in 2007.
Non-interest expense increased $4 thousand or less than 1% in the second
quarter of 2008, compared to the second quarter of 2007 and $61 thousand or
3% for the six months ended June 30, 2008 compared to the six months ended
June 30, 2007.
At June 30, 2008, the Company's total assets were $165 million, an increase
of $13.5 million or 9%, compared to June 30, 2007. Total loans and leases
were $130 million at June 30, 2008, an increase of $3.6 million or 2.9%,
compared to June 30, 2007. Total deposits were $140 million at June 30,
2008, an increase of $17 million or 14%, compared to June 30, 2007.
During the second quarter of 2008 the Company made a $150,000 provision to
its allowance for loan and lease losses. This compares to a provision of
$40,000 made during the second quarter of 2007. As of June 30, 2008 the
allowance for loan and lease losses is $2.9 million or 2.24% of total
loans.
Non-performing assets, those defined as loans ninety days or more past due
and/or placed on non-accrual status were $3.3 million as of June 30, 2008
compared to $0 as of June 30 2007 and $2.0 million as of December 31, 2007.
The non-performing assets are directly related to three residential real
estate development projects and management believes that it has adequately
reserved for these assets.
In recognition of the rapidly changing economic conditions within the
marketplace the Company has committed to, among other things, continuing to
maintain capital levels well in excess of regulatory minimums and
aggressive loan portfolio management practices. Management feels that
these actions are both conservative and appropriate in this economic
environment and are in the best interests of our clients and shareholders.
David R. Kaiser, President and CEO, stated, "We are pleased to report that
the Bank remains profitable, our capital levels remain well in excess of
regulatory minimums and we continue to control non-interest expenses. As a
community bank our financial results are impacted by the economic
conditions within our South Placer County, California marketplace. The
economic challenges facing our region in the first half of 2008 include
significant declines in residential real estate values which have increased
the stress on many sectors of the economy. The overall loan portfolio
continues to perform well in spite of the general economic conditions."
ABOUT GRANITE BANCSHARES, INC. and GRANITE COMMUNITY BANK, N.A.
Granite Bancorp, Inc. is the parent holding company of Granite Community
Bank, N.A., which is headquartered in Granite Bay, California and has three
offices serving the South Placer County region of Northern California. For
further information, please contact David Kaiser, President CEO, at (916)
780-5605.
Cautionary Statement: This release may contain certain forward-looking
statements that are subject to risks and uncertainties that could cause
actual results and events to differ materially from those stated herein.
Words such as "anticipate," "believe," "estimate," "expect," "should,"
"intend," "project," and words or phrases of similar meaning are intended
to identify forward-looking statements. Management's assumptions and
projections are based on their anticipation of future events and actual
performance may differ materially from that projected.
(Dollar amounts in thousands, except share and per share data)
(Unaudited)
Three months ended Six months ended
--------------------------- ---------------------------
June 30, June 30,
--------------------------- ---------------------------
FOR THE PERIOD: 2007 2008 Change 2007 2008 Change
--------- --------- ----- --------- --------- -----
Net interest
income 1,678 1,427 -15% 3,333 2,851 -14%
Provision for loan
and lease loss 40 150 275% 90 175 94%
Non-interest
income 108 637 490% 273 737 170%
Non-interest
expense 1,188 1,184 0% 2,394 2,455 3%
Pretax income 558 730 31% 1,122 958 -15%
Provision for tax 227 158 -30% 439 180 -59%
Net income 331 572 73% 683 778 14%
Net income per
basic share 0.24 0.42 0.51 0.57
Net income per
diluted share 0.23 0.41 0.48 0.56
Shares
outstanding 1,359,066 1,362,884 1,359,066 1,362,884
Average 1,355,550 1,362,884 1,347,806 1,362,480
Fully diluted 1,410,286 1,386,903 1,409,233 1,396,152
SELECTED FINANCIAL
RATIOS (Annualized):
Return on average
assets 0.85% 1.40% 0.89% 0.98%
Return on average
equity 8.26% 14.2% 8.62% 9.69%
Average shareholder
equity to average
assets 10.34% 9.94% 10.36% 10.12%
Net interest
margin 4.61% 3.73% 4.67% 3.81%
AT PERIOD END:
Loans and leases 126,209 129,845
Allowance for
loan and lease
loss 1,549 2,904
Total assets 151,371 164,920
Shareholder equity 16,134 16,491
Deposits 122,653 140,130
Total risk based
capital ratio 11.92 12.65
Allowance for
loan and lease
loss to total
loans 1.23 2.24