SOURCE: FNB Bancorp

FNB Bancorp

July 30, 2014 17:00 ET

First National Bank of Northern California Reports Second Quarter 2014 Earnings of $0.39 per Diluted Share

SOUTH SAN FRANCISCO, CA--(Marketwired - Jul 30, 2014) - 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 second quarter of 2014 of $1,629,000 or $0.39 per diluted share, compared to net earnings available to common shareholders of $1,207,000 or $0.30 per diluted share for the second quarter of 2013. During the second quarter of 2014, FNB Bancorp signed a definitive agreement and submitted an application to the Office of the Comptroller of the Currency to purchase Valley Community Bank in an all stock transaction. This acquisition is expected to close during the fourth quarter of 2014.

"During the second quarter of 2014, the Bank experienced strong deposit growth. Most of the higher rate interest-bearing brokered time deposits acquired in our Oceanic Bank acquisition have matured. Overall, our deposit portfolio has performed in line with expectations, with reductions in certificates of deposit more than offset by increases in DDA, NOW and MMDA accounts. During the second quarter of 2014, there was a decrease of $18,000,000 in our outstanding wholesale borrowings obtained from the Federal Home Loan Bank, which totaled $7,000,000 as of June 30, 2014. The Bank intends to use and repay outstanding borrowings as needed in order to stay fully invested in our loan and investment portfolios in the near term. Loan originations slowed during the second quarter of 2014 in comparison to the first quarter of the year, but yields have held steady. During the second quarter of 2014, the Bank realized a $1.1 million recovery from a single credit relationship that was credited to the Bank's Allowance for Loan Loss, giving us further evidence that the worst of the credit issues caused by the last recession are now behind us," stated Tom McGraw, Chief Executive Officer.

                         
Financial Highlights: Second Quarter, 2014   (Unaudited)  
Consolidated Statements of Earnings
(in '000s except share and earnings per share amounts)
  Three months
ended
June 30,
2014
    Three months
ended
June 30,
2013
    Six months
ended
June 30,
2014
    Six months
ended
June 30,
2013
 
                                 
Interest income   $ 9,267     $ 9,366     $ 18,244     $ 18,755  
Interest expense     (555 )     (639 )     (1,024 )     (1,321 )
  Net interest income     8,712       8,727       17,220       17,434  
Provision for loan losses     -       (510 )     (75 )     (1,110 )
Noninterest income     980       1,084       2,026       2,068  
Noninterest expense     (7,210 )     (7,385 )     (14,052 )     (15,124 )
  Income before provision for income taxes     2,482       1,916       5,119       3,268  
Provision for income tax     (853 )     (537 )     (1,656 )     (959 )
  Net earnings     1,629       1,379       3,463       2,309  
  Dividends and discount accretion on preferred stock     -       (172 )     (170 )     (330 )
  Net earnings available to common shareholders   $ 1,629     $ 1,207     $ 3,293     $ 1,979  
                                 
Basic earnings per share   $ 0.40     $ 0.31     $ 0.82     $ 0.51  
Diluted earnings per share   $ 0.39     $ 0.30     $ 0.80     $ 0.49  
                               
Average assets   $ 898,817     $ 904,421     $ 894,211     $ 899,231  
Average equity   $ 89,063     $ 93,938     $ 88,863     $ 94,654  
Return on average assets (annualized)     0.72 %     0.53 %     0.74 %     0.44 %
Return on average equity (annualized)     7.32 %     5.14 %     7.41 %     4.18 %
Efficiency ratio     74 %     75 %     73 %     78 %
Net interest margin (taxable equivalent)     4.11 %     4.39 %     4.25 %     4.41 %
Average shares outstanding     4,029       3,919       4,007       3,911  
Average diluted shares outstanding     4,159       4,003       4,142       4,000  
                                 
                                 
                                 
Financial Highlights: Second Quarter, 2014

Consolidated Balance Sheets
(in '000s)
  (Unaudited)
As of
June 30,
2014
    *
As of
December 31,
2013
    (Unaudited)
As of
June 30,
2013
    *
As of
December 31,
2012
 
                                 
  Assets:                                
Cash and cash equivalents   $ 21,682     $ 14,007     $ 23,698     $ 27,861  
Interest-bearing time deposits with other financial institutions     4,461       5,543       8,473       13,216  
Securities available for sale, at fair value     267,795       263,988       281,422       234,945  
Loans, net     560,432       552,343       531,238       541,563  
Premises, equipment and leasehold improvements, net     12,429       12,512       12,699       12,706  
Other real estate owned, net     754       5,318       6,675       6,650  
Goodwill     1,841       1,841       1,841       1,841  
Other equity securities     5,576       5,300       5,300       5,464  
Accrued interest receivable     3,674       3,808       3,886       3,760  
Prepaid expenses     504       701       718       1,372  
Bank owned life insurance     12,337       12,151       11,975       11,785  
Other assets     13,945       14,418       13,563       14,177  
  Total assets   $ 905,430     $ 891,930     $ 901,488     $ 875,340  
                                 
  Liabilities and stockholders' equity:                                
Deposits:                                
Demand and NOW   $ 286,017     $ 279,269     $ 269,369     $ 253,849  
Savings and money market     397,457       370,194       385,017       343,437  
Time     106,748       124,152       148,414       171,066  
  Total deposits     790,222       773,615       802,800       768,352  
Federal Home Loan Bank advances     7,000       15,000       -       -  
Note payable     5,850       -       -       -  
Accrued expenses and other liabilities     11,215       9,066       8,597       11,630  
  Total liabilities     814,287       797,681       811,397       779,982  
Stockholders' equity     91,143       94,249       90,091       95,358  
  Total liab. and stockholders' equity   $ 905,430     $ 891,930     $ 901,488     $ 875,340  
                                 
* Taken from the audited annual financial statements                                
                                 
Other Financial Information                                
Allowance for loan losses   $ 10,859     $ 9,879     $ 9,745     $ 9,124  
Nonperforming assets   $ 6,217     $ 12,669     $ 18,527     $ 19,124  
Total gross loans   $ 571,291     $ 562,222     $ 540,983     $ 550,687  
                                 

"During the second quarter, the Bank continued to improve our capital position through the retention of earnings, even after an increase of $0.01 per share in the quarterly cash dividend declared to $0.11 per share. Total assets grew at an annualized rate of less than 2% during the quarter which helped the Bank improve our Tier 1 leverage capital ratio to 10.06% as of June 30, 2014. The Bank remains 'well capitalized' in all regulatory capital calculations and we have sufficient capital resources to be able to pursue potential acquisitions that may benefit the bank in this environment. To be successful, we understand that we must continually meet or exceed our customers' expectations. For over 50 years, we have built our organization around the idea that we must earn our customers' business," continued CEO Tom McGraw.

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.

Contact Information

  • Contacts:
    Tom McGraw
    Chief Executive Officer
    (650) 875-4864

    Dave Curtis
    Chief Financial Officer
    (650) 875-4862