SOURCE: Princeton National Bancorp, Inc.

Princeton National Bancorp, Inc.

April 27, 2010 11:30 ET

Princeton National Bancorp, Inc. Announces First Quarter 2010 Results

PRINCETON, IL--(Marketwire - April 27, 2010) -  Princeton National Bancorp, Inc. (NASDAQ: PNBC), the holding company of Citizens First National Bank, announced a net loss available to common stockholders of $62,000 or $0.02 per common share, compared to net income available to common stockholders of $914,000 or $0.28 in the first quarter of 2009.

"The Company's 2010 first quarter loss available to common stockholders reflects credit-related costs associated with the Company's continuing efforts to further improve the risk profile of its balance sheet. During the first quarter, the net interest margin improved and core deposits remained strong; however, substantial credit costs continued to exert pressure on the bottom-line. Despite the improvement over our fourth quarter of 2009, we remain unsatisfied with our financial performance and will continue to focus on improving the profitability of the Company," said Thomas D. Ogaard, President and Chief Executive Officer.

"At the forefront of improving the Company's profitability, the net interest margin improved to 3.90% for the first quarter from 3.40% for the same period in 2009, driven by an improvement of 81 basis points in the cost of funds or a reduction in interest expense of $1.950 million; the net interest margin is expected to continue to rise throughout 2010," stated Ogaard.

"In addition to focusing on improving our financial performance, we will continue to strive to eliminate risk from our balance sheet, implement best risk management practices and provide excellent customer service," Ogaard concluded.

Total assets ended the quarter at $1.200 billion, a decrease of 4.8% from $1.261 billion at December 31, 2009. Princeton National Bancorp, Inc. made a decision to restructure its balance sheet, resulting in a $41.2 million decrease in total loans as of March 31, 2010 in comparison to December 31, 2009 (primarily due to an increase in the number of loan participations, along with seasonal agricultural paydowns).

The non-performing loans of $67.3 million show an increase from $58.6 million at year-end. At the end of the first quarter, specific loss provisions established for individual credits totaled $6.3 million. The Subsidiary Bank staff will continue to work with borrowers to resolve problem loan situations and to work through the challenging remediation cycle for real estate and construction-related credits. Recognizing this, and reflective of current economic conditions, we have increased our level of loan loss provisioning, bringing our level of reserves to 1.94% of total loans, an increase from .76% one year ago. The loan loss provision taken in the first quarter totaled $3,925,000 versus $6,000,000 and $1,170,000 in the fourth and first quarters of 2009, respectively.

In the fourth quarter of 2009, the subsidiary bank made a decision to reduce its deposit concentration in specific sectors and, as a result, total deposits decreased $44.0 million during the first quarter of 2010.

In the first quarter of 2010, the Company saw the retirement of Tony J. Sorcic as President & CEO, the promotion of Thomas D. Ogaard as President & CEO, and promotion of Todd D. Fanning as Executive Vice President & COO/CFO, and the appointment of Todd D. Fanning to the Board of Directors. In addition, in March of 2010, Daryl Becker and Donald E. Grubb announced their retirement from the Board of Directors of the Company and Subsidiary Bank in April 2010. They have been strong members of the Boards of Directors and their input has been invaluable.

The price of PNBC stock closed at $8.69 on March 31, 2010, compared to $10.81 on December 31, 2009.

For detailed financial information, please refer to the attached March 31, 2010 financial statements for Princeton National Bancorp, Inc. You may also visit our website at www.pnbc-inc.com to obtain financial information, as well as press releases, stock prices and information on the Company.

The Company offers stockholders the opportunity to participate in the Princeton National Bancorp, Inc. Dividend Reinvestment and Stock Purchase Plan, which allows for optional cash contributions to purchase stock. The Company also offers electronic direct deposit of dividends. To obtain information about the stock purchase plan or electronic direct deposit, please contact us at 815-872-6131.

Princeton National Bancorp, Inc. is the parent holding company of Citizens First National Bank, a $1.200 billion community bank with strategic locations in 8 counties in northern Illinois. The Company is well-positioned in the high growth counties of Will, Kendall, Kane, Grundy, DeKalb and LaSalle plus Bureau and Marshall. Communities include: Aurora, DePue, Genoa, Hampshire, Henry, Huntley, Millbrook, Minooka, Newark, Oglesby, Peru, Plainfield, Plano, Princeton, Sandwich, Somonauk and Spring Valley. The Subsidiary Bank, Citizens First National Bank, provides financial services to meet the needs of individuals, businesses and public entities.

This press release contains certain forward-looking statements, including certain plans, expectations, goals, and projections, which are subject to numerous assumptions, risks, and uncertainties. These forward-looking statements are identified by the use of words such as 1) believes, 2) anticipates, 3) estimates, 4) expects, 5) projects or similar words. Actual results could differ materially from those contained or implied by such statements for a variety of factors including: changes in economic conditions; movements in interest rates; competitive pressures on product pricing and services; success and timing of business strategies; the nature, extent, and timing of governmental actions and reforms; and extended disruption of vital infrastructure. The figures included in this press release are unaudited and may vary from the audited results.

   
   
   
CONSOLIDATED BALANCE SHEETS  
(dollars in thousands, except share data)  
  March 31,     December 31,  
    2010     2009  
    (unaudited)        
                 
ASSETS                
                 
Cash and due from banks $ 12,797     $ 15,546  
Interest-bearing deposits with financial institutions   81,387       55,527  
  Total cash and cash equivalents   94,184       71,073  
                 
Loans held for sale, at lower of cost or market   932       3,296  
                 
Investment securities available-for-sale, at fair value   250,459       288,474  
Investment securities held-to-maturity, at amortized cost   13,947       12,793  
  Total investment securities   264,406       301,267  
                 
Loans, net of unearned interest   756,836       798,074  
Allowance for loan losses   (14,682 )     (12,075 )
  Net loans   742,154       785,999  
                 
Premises and equipment, net   27,888       28,269  
Land held for sale, at lower of cost or market   2,354       2,354  
Federal Reserve and Federal Home Loan Bank stock   4,230       4,230  
Bank-owned life insurance   22,781       22,540  
Interest receivable   7,355       9,267  
Intangible assets, net of accumulated amortization   3,143       3,347  
Other real estate owned   20,145       17,658  
Other assets   10,902       11,430  
                 
  TOTAL ASSETS $ 1,200,474     $ 1,260,730  
                 
                 
LIABILITIES              
                 
Demand deposits $ 121,863     $ 136,026  
Interest-bearing demand deposits   377,453       374,624  
Savings deposits   72,984       68,292  
Time deposits   459,154       496,597  
  Total deposits   1,031,454       1,075,539  
                 
Customer repurchase agreements   39,082       47,327  
Advances from the Federal Home Loan Bank   22,500       31,500  
Interest-bearing demand notes issued to the U.S. Treasury   1,514       1,021  
Trust Preferred securities   25,000       25,000  
  Total borrowings   88,096       104,848  
                 
Other liabilities   4,989       5,683  
  Total liabilities   1,124,539       1,186,070  
                 
STOCKHOLDERS' EQUITY              
                 
Preferred stock   24,958       24,958  
Common stock   22,391       22,391  
Common stock warrants   150       150  
Additional paid-in capital   18,419       18,423  
Retained earnings   29,796       29,851  
Accumulated other comprehensive income (loss), net of tax   4,093       2,816  
Less: Treasury stock   (23,872 )     (23,929 )
  Total stockholders' equity   75,935       74,660  
                 
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 1,200,474     $ 1,260,730  
                 
                 
CAPITAL STATISTICS (UNAUDITED)              
                 
YTD average equity to average assets   6.25 %     7.84 %
Tier 1 leverage capital ratio   7.53 %     7.48 %
Tier 1 risk-based capital ratio   10.70 %     10.25 %
Total risk-based capital ratio   11.96 %     11.50 %
Common book value per share $ 15.40     $ 15.03  
Closing market price per share $ 8.69     $ 10.81  
End of period shares outstanding   3,309,710       3,306,369  
End of period treasury shares outstanding   1,168,585       1,171,926  
               
 
 
   
   
   
CONSOLIDATED STATEMENTS OF INCOME  
(dollars in thousands, except share data)            
    THREE MONTHS     THREE MONTHS  
    ENDED     ENDED  
    March 31, 2010     March 31, 2009  
    (unaudited)     (unaudited)  
                 
INTEREST INCOME                
                 
Interest and fees on loans   $ 10,585     $ 11,059  
Interest and dividends on investment securities     2,843       2,931  
Interest on interest-bearing time deposits in other banks     32       16  
  Total Interest Income     13,460       14,006  
                 
INTEREST EXPENSE                
                 
Interest on deposits     3,372       5,147  
Interest on borrowings     605       780  
  Total Interest Expense     3,977       5,927  
                 
Net interest income     9,483       8,079  
Provision for loan losses     3,925       1,170  
                 
Net interest income after provision     5,558       6,909  
                 
NON-INTEREST INCOME                
Trust & farm management fees     264       314  
Service charges on deposit accounts     891       976  
Other service charges     495       446  
Gain on sales of securities available-for-sale     642       187  
Brokerage fee income     189       198  
Mortgage banking income     460       1  
Bank-owned life insurance     229       243  
Other operating income     22       430  
  Total Non-Interest Income     3,192       2,795  
                 
NON-INTEREST EXPENSE                
Salaries and employee benefits     4,412       4,471  
Occupancy     700       709  
Equipment expense     767       773  
Federal insurance assessments     698       697  
Intangible assets amortization     204       208  
Data processing     312       316  
Advertising     176       197  
ORE Expenses, net     735       113  
Other operating expense     1,282       1,168  
  Total Non-Interest Expense     9,286       8,652  
                 
Income before income taxes     (536 )     1,052  
Income tax expense     (795 )     (104 )
                 
Net income     259       1,156  
                 
Preferred stock dividends     314       237  
Accretion of preferred stock discount     7       5  
                 
Net income available to common stockholders   $ (62 )   $ 914  
                 
Net income (loss) per share available to common stockholders:                
  BASIC   $ (0.02 )   $ 0.28  
  DILUTED   $ (0.02 )   $ 0.28  
                 
Basic weighted average shares outstanding     3,306,762       3,298,064  
Diluted weighted average shares outstanding     3,306,762       3,298,725  
                 
                 
PERFORMANCE RATIOS (annualized)                
                 
Return on average assets     0.09 %     0.40 %
Return on average equity     1.38 %     5.14 %
Net interest margin (tax-equivalent)     3.90 %     3.40 %
Efficiency ratio (tax-equivalent)     69.26 %     75.29 %
                 
                 
ASSET QUALITY                
                 
Net loan charge-offs   $ 1,366     $ 371  
Total non-performing loans   $ 67,291     $ 33,278  
Non-performing loans as a % of total loans     9.08 %     4.30 %
 

Contact Information

  • Inquiries should be directed to:

    Lou Ann Birkey
    Vice President - Investor Relations
    Princeton National Bancorp, Inc.
    (815) 875-4444
    E-Mail address: Email Contact