SOURCE: EvergreenBancorp, Inc.

February 08, 2007 21:07 ET

EvergreenBancorp Earnings Climb 88%

SEATTLE, WA -- (MARKET WIRE) -- February 8, 2007 -- EvergreenBancorp, Inc. (OTCBB: EVGG), the holding company for EvergreenBank, reported net income for 2006 of $1.82 million, or $.88 per diluted share, compared with $966 thousand, or $.47 per diluted share, for 2005. Earnings for the fourth quarter of 2006 were $593 thousand, or $.27 per diluted share compared with $252 thousand, or $0.12 per share for the same period last year. Assets at year-end totaled $343.52 million, compared with $249.19 million at year-end 2005.

Gerald Hatler, President and CEO of EvergreenBancorp, Inc., said, "Earnings for the fourth quarter rounded out a year of quarter over quarter over quarter of improving earnings both relatively and absolutely. The final result was a year that produced record earnings for our company and record return on equity for our shareholders."

Financial highlights

Year 2006 highlights include:

--  Net income increased $853 thousand, or 88%
--  Diluted earnings per share rose 85%, to $.88
--  Total assets increased to $343.52 million, a $94.33 million, or 38%,
    increase from one year earlier
--  Net loans rose $102.53 million, or 55%, to $289.67 million
--  Deposits rose $56.55 million, or 28%, from $199.89 million to $256.44
    million
--  An additional $4.55 million in equity capital, net of offering costs,
    was raised through a secondary offering of common stock to support current
    and future growth. The company's regulatory capital was further boosted by
    a $7 million Trust Preferred stock offering completed in the fourth quarter
    of 2006
--  Credit quality continued to be strong in 2006, with nonperforming
    loans at year-end totaling .17% of loans outstanding, compared with .61% at
    year-end 2005
    
Operating Results

Net interest income before provision for loan losses totaled $12.54 million in 2006 compared with $10.26 million for 2005, an increase of 22%. Non-interest income for 2006 totaled $1.83 million, an increase of $135 thousand, or 8%, over 2005.

Net interest income before provision for loan losses for the fourth quarter of 2006 was $3.50 million, an increase of $799 thousand, or 30%, over the $2.70 million recorded in the same quarter last year. This increase was primarily due to increased loan totals. For the year, the company’s provision for loan losses totaled $810 thousand. This compares with $423 thousand in 2005. Non-interest income in the fourth quarter of 2006 increased 17% over year-earlier levels, to $485 thousand from $413 thousand.

EvergreenBancorp's net interest margin before provision for loan losses decreased to 4.67% in 2006 compared with 5.15% in 2005. The decrease was primarily the result of an increase in the bank's cost of funds, reflecting greater reliance on non-core funding sources to meet strong loan demand. For the fourth quarter of 2006, the Company's net interest margin was 4.57%, compared with 5.21% for the same period in 2005.

Non-interest expense for 2006 was $10.95 million compared with $10.15 million for 2005. This represents an increase of $800 thousand, or 8%. For the fourth quarter, non-interest expense was $2.89 million compared with $2.65 million for the same quarter in 2005, an increase of 9%. The ratio of non-interest expense to average assets continues to improve. For 2006, the ratio stood at 3.8% compared with 4.7% for last year. In the fourth quarter, the ratio improved further, to an annualized 3.6%, from 4.7% during the fourth quarter of 2005.

Hatler continued, "The favorable growth in our assets is reflected in our results from operations. As we continue to manage our net interest margin in light of the challenging interest rate environment, our discipline in controlling our non-interest expenses accelerated the growth in our bottom line."

Return on average equity for 2006 was 9.55%, compared with 5.49% for 2005. For the fourth quarter of 2006, annualized return on average equity was 10.79% compared with 5.71% for the same period last year.

Balance Sheet Results

The company's growth to $343.52 million in assets was supported by a record total in deposits ending at $256.44 million compared to $199.89 million in 2005, an increase of 28%. Asset quality remains strong, with net charge-offs for the year of just $82 thousand. Nonperforming loans at the end of 2006 stood at $497 thousand, or .17% of total loans outstanding, compared with $1.15 million, or .61% of total loans outstanding on December 31, 2005. The Bank's allowance for loan losses stood at $2.78 million, or .95% of total loans at year-end 2006 compared with $2.06 million, or 1.09%, one year earlier. The company's capital to assets ratio ended at 6.9%, reflecting both EvergreenBancorp's significant growth over the past 12 months and the $4.55 million raised in our common stock offering in the fourth quarter. On December 31, 2005, the ratio stood at 7.12%.

About EvergreenBancorp and EvergreenBank

Founded in 1971, EvergreenBank is a subsidiary of EvergreenBancorp, Inc., a bank holding company headquartered in Seattle, Washington. EvergreenBank is an independent community bank with six offices in Seattle, Bellevue, Lynnwood, and Federal Way. The Bank is an award-winning institution, named in 2005 as one of the "best companies to work" for by Washington CEO magazine, as well as "best rated bank service" by Consumer Checkbook Magazine. It offers a full suite of personal and business banking services. Services include commercial, real estate, and consumer lending; savings, checking, and certificate of deposit accounts; health savings accounts; Internet banking; and merchant credit card processing services.

EvergreenBancorp stock trades on the Over-The-Counter Bulletin Board under the EVGG symbol. Visit www.EvergreenBancorp.com to learn more.

This press release contains "forward-looking statements" within the meaning of federal securities law, including statements concerning business strategies and their intended results, and similar statements concerning expectations that are not historical facts. The forward-looking statements in this press release are subject to numerous risks and uncertainties, including the effects of economic conditions, demand for financial services, competitive conditions, regulatory changes, and the availability of capital to finance growth, which could cause actual results to differ materially from those expressed in or implied by the statements herein.

Statements of Income (Unaudited)
(in thousands)

                                                Twelve months ended
                                                   December 31,
                                                   2006      2005   Change
Interest and dividend income
Loans, including fees                            $ 19,352 $ 12,371 $  6,981
Federal funds sold and other                          130      179      -49
Investments securities:
   Taxable securities                               1,167    1,036      131
   Tax exempt securities                              137      126       11
                                                 -------- -------- --------
Total interest and dividend income                 20,786   13,712    7,074

Interest expense
Deposits                                            5,706    2,521    3,185
Federal funds purchased                                75       15       60
Advances from Federal Home Loan Bank                1,979      568    1,411
Junior subordinated debt                              491      345      146
                                                 -------- -------- --------
Total interest expense                              8,251    3,449    4,802

Net interest income                                12,535   10,263    2,272
Provision for loan losses                             810      423      387

Net interest income after provision for loan
 losses                                            11,725    9,840    1,885

Noninterest income
Service charges on deposit accounts                 1,165    1,177      -12
Net Merchant credit card processing                   157      151        6
Earnings in value of CSV-life insurance               226       90      136
Other noninterest income                              280      275        5
                                                 -------- -------- --------
Total noninterest income                            1,828    1,693      135

Noninterest  expense
Salaries and employee benefits                      5,416    4,898      518
Occupancy and equipment                             1,811    1,697      114
Data processing                                       832      744       88
Professional fees                                     318      391      -73
Marketing                                             485      473       12
State and local taxes                                 358      306       52
Other noninterest expense                           1,730    1,641       89
                                                 -------- -------- --------
Total noninterest expense                          10,950   10,150      800

Income before income tax expense                    2,603    1,383    1,220
Income tax expense                                    784      417      367
                                                 -------- -------- --------
Net income                                       $  1,819 $    966 $    853
                                                 ======== ======== ========

Basic earnings per share                         $   0.89 $   0.48 $   0.41
Diluted earnings per share                       $   0.88 $   0.47 $   0.41


Consolidated Balance Sheets
(Unaudited)

                                         December 31, December 31,
Assets                                       2006        2005      Change
                                          ----------- ----------- ---------
Cash and due from banks                   $     9,160 $    12,379 -$  3,219
Interest-bearing deposits in financial
 institutions                                     760       2,811    -2,051
Federal funds sold                              1,983       2,112      -129
                                          ----------- ----------- ---------
   Total cash and cash equivalents             11,903      17,302    -5,399
Securities available for sale                  29,531      33,550    -4,019
Loans                                         292,449     189,188   103,261
Allowance for loan losses                      -2,784      -2,056      -728
                                          ----------- ----------- ---------
   Net Loans                                  289,665     187,132   102,533
Premises and equipment                          3,078       3,179      -101
Bank owned life insurance                       5,316       5,090       226
Accrued interest and other assets               4,027       2,939     1,088
                                          ----------- ----------- ---------
Total assets                              $   343,520 $   249,192 $  94,328
                                          =========== =========== =========

Liabilities

Deposits:
   Noninterest bearing                    $    55,373 $    64,635 -$  9,262
   Interest bearing                           201,062     135,255    65,807
                                          ----------- ----------- ---------
Total deposits                                256,435     199,890    56,545
Junior subordinated debt                       12,217       5,000     7,217
Advances from Federal Home Loan Bank           46,805      23,849    22,956
Accrued expenses and other liabilities          4,244       2,717     1,527
                                          ----------- ----------- ---------
Total liabilities                             319,701     231,456    88,245

Stockholders' equity

Preferred stock: No par value; 100,000
 shares authorized issued and outstanding
 - none                                             0           0         0
Common stock and surplus: 2004 - No par
 value;  15,000,000 shares authorized;
 2,353,262 shares issued and outstanding,
 at 2006; 2,000,467 shares issued at 2005      21,129      16,005     5,124
Retained earnings                               3,453       2,187     1,266
Accumulated other comprehensive loss             -763        -456      -307
                                          ----------- ----------- ---------
Total stockholders' equity                     23,819      17,736     6,083
                                          ----------- ----------- ---------
Total liabilities and stockholders'
 equity                                   $   343,520 $   249,192 $  94,328
                                          =========== =========== =========



Contact Information

  • Contact:
    EvergreenBancorp, Inc.
    Gordon Browning
    Executive Vice President and Chief Financial Officer
    206-749-7350