SOURCE: Coast Bancorp

March 20, 2008 19:43 ET

Coast Bancorp Earnings Announcement

SAN LUIS OBISPO, CA--(Marketwire - March 20, 2008) - Coast Bancorp (OTCBB: CTBP), the holding company for Coast National Bank, announced the audited financial results for the year ended December 31, 2007.

Total assets at December 31, 2007 were $183.8 million, a 1.7% increase from $180.7 million at December 31, 2006.

Net loans at December 31, 2007 were $142.3 million, an increase of $7.2 million or 5.3% from $135.1 million at December 31, 2006. The recorded investment in impaired loans as of December 31, 2007 was $4.2 million, an increase of $1.7 million or 68% from $2.5 million at December 31, 2006. The allowance for loan and lease losses, which covers credit losses pertaining to the loan portfolio, was $1,487,000 or 1.03% of total loans at December 31, 2007. The Company also carried an additional $55,000 allowance for credit losses pertaining to its unfunded commitments in the liability section of its balance sheet. Collectively, the total allowance for all types of credit losses was $1,542,000 at December 31, 2007 as compared to $1,443,000 at December 31, 2006. Total interest income recognized for cash payments on impaired loans for the twelve months ended December 31, 2007 was $92,000, an $87,000 increase over the $5,000 received during the twelve months ended December 31, 2006.

Deposits as of December 31, 2007 were $162.1 million, a $0.4 million, or 0.3% decrease from $162.5 million at December 31, 2006.

Total stockholders' equity increased 11.0% to $14.1 million as of December 31, 2007 as compared to $12.7 million at December 31, 2006. The Company remained "well capitalized" by regulatory standards, with a Tier 1 Leverage Capital Ratio of 10.2%, a Tier 1 Risk Based Capital Ratio of 12.4% and a Total Risk Based Capital Ratio of 15.0%.

Net interest income before the provision for loan losses for the twelve months ended December 31, 2007 was $8,379,000, a decrease of 7.0% when compared to $9,007,000 in the same period in 2006. The decrease in net interest income was primarily attributable to a decreased net interest margin, partially offset by an increase in earning assets.

Noninterest income for the twelve months ending December 31, 2007 was $538,000, a decrease of 38.6% compared to $876,000 for the same period in 2006, primarily due to a decrease in SBA loan sales.

Noninterest expense for the twelve months ending December 31, 2007 was $7,001,000, a decrease of 4.8% compared to $7,354,000 for the same period in 2006, primarily due to decreases in marketing and personnel expenses.

Net income for the year ended December 31, 2007 was $1,008,000, or $1.40 per diluted share, a 26.6% decrease from $1,374,000, or $1.93 per diluted share for the twelve months ended December 31, 2006. The decrease is primarily the result of a lower net interest margin and a decrease in noninterest income.

Coast National Bank opened for business on June 16, 1997. The Bank is an independent community bank with five banking offices and a loan production office. With a focus on delivering unsurpassed customer service, the Bank provides small business loans, home loans and other loans, as well as an array of business and personal banking deposit products and other services. The Bank is a wholly-owned subsidiary of Coast Bancorp, a $184 million bank holding company, headquartered in San Luis Obispo, California. Coast Bancorp stock trades under the ticker symbol "CTBP.OB." For more information, visit www.coastnationalbank.com or call 805.541.0400.

Please refer to the following Consolidated Balance Sheets as of December 31, 2007 and 2006 and Consolidated Statements of Income for the twelve months ended December 31, 2007 and 2006 for specific information regarding the Company's financials.

                          Coast Bancorp and Subsidiary
                          Consolidated Balance Sheets
                           December 31, 2007 and 2006

ASSETS                                             2007          2006
                                              -------------  -------------

Cash and due from banks                       $   6,923,496  $   7,173,159
Federal funds sold                               14,350,000     17,800,000
                                              -------------  -------------
TOTAL CASH AND CASH EQUIVALENTS                  21,273,496     24,973,159

Investment securities available for sale          7,694,486      7,925,950

Loans:
   Commercial                                    41,498,791     41,725,900
   Real estate - construction                    41,044,155     28,126,176
   Real estate - other                           58,050,610     62,298,552
   Consumer                                       3,339,550      4,705,259
                                              -------------  -------------
TOTAL LOANS                                     143,933,106    136,855,887

Net deferred loan fees                             (162,696)      (352,195)
Allowance for credit losses                      (1,487,131)    (1,388,310)
                                              -------------  -------------
NET LOANS                                       142,283,279    135,115,382

Premises and equipment                            8,733,401      9,739,660
Deferred taxes                                      485,000        472,000
Federal Reserve Bank and Federal Home Loan
 Bank stock, at cost                                991,350        945,650
Other Real Estate Owned                             770,000              -
Accrued interest and other assets                 1,520,398      1,567,341
                                              -------------  -------------
TOTAL ASSETS                                  $ 183,751,410  $ 180,739,142
                                              =============  =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
   Non-interest-bearing demand                $  42,989,733  $  39,556,425
   Money market and NOW                          45,959,276     50,035,815
   Savings                                        6,454,025      6,673,615
   Time deposits of $100,000 or more             49,012,877     50,708,688
   Other time deposits                           17,648,933     15,555,896
                                              -------------  -------------
TOTAL DEPOSITS                                  162,064,844    162,530,439

Junior subordinated debt securities               7,217,000      5,155,000
Other liabilities                                   338,924        342,474
                                              -------------  -------------
TOTAL LIABILITIES                               169,620,768    168,027,913
                                              -------------  -------------
Commitments and contingencies  - Notes #4 and
 #12                                                      -              -
Stockholders' equity:
   Preferred stock - 10,000,000 authorized,
    none outstanding                                      -              -
   Common stock no par value; 10,000,000
    shares authorized; issued and
    outstanding:   713,000 in 2007 and
    679,600 in 2006                               7,443,847      7,035,163
   Additional paid-in capital                       184,780         76,416
   Retained earnings                              6,462,202      5,610,760
   Accumulated other comprehensive income -
    net of unrealized gains (losses) on
    available-for-sale securities, net of
    taxes of $27,666 in 2007 and ($7,720)
    in 2006                                          39,813        (11,110)
                                              -------------  -------------
TOTAL STOCKHOLDERS' EQUITY                       14,130,642     12,711,229
                                              -------------  -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $ 183,751,410  $ 180,739,142
                                              =============  =============




                        Coast Bancorp and Subsidiary
                     Consolidated Statements of Income
               For the Years Ended December 31, 2007 and 2006

                                                    2007          2006
                                                ------------  -------------
INTEREST INCOME
   Interest and fees on loans                   $ 12,530,114  $  12,776,501
   Interest on investment securities                 423,211        243,553
   Interest on federal funds sold                    866,810        792,308
   Other interest income                              76,038         54,896
                                                ------------  -------------
TOTAL INTEREST INCOME                             13,896,173     13,867,258
                                                ------------  -------------
INTEREST EXPENSE
   Interest on money market and NOW accounts       1,562,697      1,420,141
   Interest on savings deposits                      145,494        129,492
   Interest on time deposits                       3,320,882      2,836,756
   Interest on junior subordinated debt
    securities                                       487,931        474,048
   Interest on other borrowings                            -            155
                                                ------------  -------------
TOTAL INTEREST EXPENSE                             5,517,004      4,860,592
                                                ------------  -------------
NET INTEREST INCOME                                8,379,169      9,006,666

Provision for credit losses                          160,000        236,000
                                                ------------  -------------
NET INTEREST INCOME AFTER
PROVISION FOR CREDIT LOSSES                        8,219,169      8,770,666
                                                ------------  -------------
NON-INTEREST INCOME
   Service charges on deposits accounts and
    other noninterest income                         387,227        341,283
   Gain on sale of loans, servicing fees, and
    amortization of servicing assets                  83,000        426,121
   Mortgage packaging fees                            73,179         88,367
   Gain (loss) on sale of premises and
    equipment                                         (5,316)        19,772
                                                ------------  -------------
TOTAL NON-INTEREST INCOME                            538,090        875,543
                                                ------------  -------------
NON-INTEREST EXPENSE
   Salaries and benefits                           3,818,194      4,047,582
   Net occupancy expenses                            507,709        501,087
   Equipment expenses                                317,606        327,585
   Data processing                                   536,316        470,131
   Director fees and expenses                        127,165        148,000
   Insurance                                          55,825         61,486
   Marketing and business promotion                  627,560        845,924
   Other professional expenses                       210,968        232,660
   Office expenses                                   235,865        253,514
   Regulatory assessments                            183,994         86,289
   Other expenses                                    379,455        379,312
                                                ------------  -------------
TOTAL NON-INTEREST EXPENSE                         7,000,657      7,353,570
                                                ------------  -------------
INCOME BEFORE INCOME TAXES                         1,756,602      2,292,639

Income taxes                                         748,300        918,500
                                                ------------  -------------
NET INCOME                                      $  1,008,302  $   1,374,139
                                                ============  =============
Per Share Data
   Net income - basic                           $       1.44  $        2.03
   Net income - diluted                         $       1.40  $        1.93

This news release contains forward-looking statements with respect to the financial condition, results of operation and business of Coast Bancorp and its subsidiaries. All financial results are unaudited and therefore subject to change. These include, but are not limited to, statements that relate to or are dependent on estimates or assumptions relating to the prospects of loan growth, credit quality and certain operating efficiencies resulting from the operations Coast National Bank. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressure among financial services companies increases significantly; (2) changes in the interest rate environment on interest margins; (3) general economic conditions, internationally, nationally or in the State of California are less favorable than expected; (4) legislation or regulatory requirements or changes adversely affect the business in which the combined organization will be engaged.

Contact Information

  • Contact:
    Coast National Bank
    (805)541-0400