SOURCE: FNB Bancorp

FNB Bancorp

October 30, 2013 16:00 ET

First National Bank of Northern California Reports Third Quarter 2013 Earnings of $0.75 per Diluted Share

SOUTH SAN FRANCISCO, CA--(Marketwired - Oct 30, 2013) - 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 third quarter of 2013 of $2,880,000 or $0.75 per diluted share, compared to net earnings available to common shareholders of $4,783,000 or $1.27 per diluted share for the third quarter of 2012. Dividend payments on the preferred shares outstanding were made as required by the Treasury Department's Small Business Lending (SBLF) Program. Total assets as of September 30, 2013 were $927,051,000 compared to $897,724,000 as of September 30, 2012. Our net loans increased by $10,615,000 since September 30, 2012. During this same time frame, our deposits decreased by $10,840,000. At September 30, 2013, the Company had considerable liquid assets on hand of $285,610,000 in available for sale securities, $6,979,000 in interest earning time deposits as well as $18,368,000 in cash and cash equivalents.

"During the third quarter of 2013, the Bank was able to increase our loan production and our net loans outstanding. At the same time, higher rate brokered time deposits acquired in our Oceanic Bank acquisition have been allowed to runoff. During the 12 month period ended September 30, 2013, which is also the first twelve months following our Oceanic Bank acquisition, our time deposit balances have decreased by $55,906,000 while our noninterest bearing demand deposits have grown by $15,068,000 and our savings and money market deposits have grown by $36,197,000. Overall, our deposit portfolio has performed well, with the decrease in total deposits in line with management's projections. During the third quarter of 2013, there was an increase in the outstanding wholesale borrowings obtained from the Federal Home Loan Bank, which totaled $44,000,000 as of September 30, 2013. The Bank intends to slowly reduce the amount of our outstanding borrowings over the next twelve months by utilizing funds derived from principal repayments that occur within our investment portfolio and the slow and steady acquisition of additional deposit accounts and dollars. There was also a sizeable tax benefit recorded during the third quarter of 2013. Based on the filing of our 2012 income tax returns and a review of our expected profitability levels, the Bank was able to reverse, in total, our outstanding deferred tax asset valuation allowance," stated Tom McGraw, Chief Executive Officer.

   
Financial Highlights: Third Quarter, 2013  
   
Consolidated Statements of Earnings  
(in '000s except earnings per share amounts)  
                         
    Three months
ended
September 30,
2013
    Three months
ended
September 30,
2012
    Nine months
ended
September 30,
2013
    Nine months
ended
September 30,
2012
 
                                 
Interest income   $ 9,259     $ 8,361     $ 28,014     $ 24,121  
Interest expense     560       663       1,881       2,000  
  Net interest income     8,699       7,698       26,133       22,121  
Provision for loan losses     (225 )     (400 )     (1,335 )     (1,200 )
Noninterest income     978       4,764       3,046       8,099  
Noninterest expense     6,950       6,631       22,074       20,182  
  Income before income taxes     2,502       5,431       5,770       8,838  
Provision for income taxes     629       (490 )     (330 )     (1,381 )
  Net earnings     3,131       4,941       5,440       7,457  
  Dividends and discount accretion on preferred stock     251       158       581       501  
  Net earnings available to common shareholders   $ 2,880     $ 4,783     $ 4,859     $ 6,956  
                                 
Basic earnings per share   $ 0.77     $ 1.30     $ 1.30     $ 1.89  
Diluted earnings per share   $ 0.75     $ 1.27     $ 1.27     $ 1.86  
                                 
Average assets   $ 903,868     $ 787,264     $ 900,794     $ 757,792  
Average equity   $ 89,728     $ 90,135     $ 92,994     $ 88,834  
Return on average assets     1.27 %     2.43 %     1.08 %     1.22 %
Return on average equity     12.84 %     21.23 %     10.45 %     10.44 %
Efficiency ratio     72 %     53 %     76 %     67 %
Net interest margin (taxable equivalent)     4.23 %     4.58 %     4.34 %     4.55 %
Average shares outstanding     3,761       3,692       3,735       3,689  
Average diluted shares outstanding     3,852       3,759       3,824       3,745  
                                 
                                 
                 
Financial Highlights: Third Quarter, 2013
 
Consolidated Balance Sheets
(in '000s)
    As of
September 30,
2013
  As of
December 31,
2012
  As of
September 30,
2012
  As of
December 31,
2011
                         
  Assets:                        
Cash and cash equivalents   $ 18,368   $ 27,861   $ 53,708   $ 38,474
Interest-bearing time deposits with other financial institutions    
6,979
   
13,216
   
17,095
   
-
Securities available for sale, at fair value     285,610     234,945     228,805     187,664
Loans, net     558,164     541,563     547,549     443,721
Premises, equipment and leasehold improvements, net    
12,631
   
12,706
   
12,761
   
13,227
Other real estate owned, net     6,675     6,650     1,923     2,747
Goodwill     1,841     1,841     1,841     1,841
Other equity securities     5,300     5,464     5,888     4,608
Accrued interest receivable     3,855     3,760     3,639     3,614
Prepaid expenses     741     1,372     1,513     2,107
Bank owned life insurance     12,065     11,785     11,691     9,521
Other assets     14,822     14,177     11,311     8,117
  Total assets   $ 927,051   $ 875,340   $ 897,724   $ 715,641
                         
  Liabilities and stockholders' equity:                        
Deposits:                        
Demand and NOW   $ 263,480   $ 253,849   $ 254,611   $ 202,690
Savings and money market     387,275     343,437     351,078     310,237
Time     130,369     171,066     186,275     108,851
  Total deposits     781,124     768,352     791,964     621,778
Federal Home Loan Bank advances     44,000     1,220     2,728     -
Accrued expenses and other liabilities     9,109     10,410     8,316     6,667
  Total liabilities     834,233     779,982     803,008     628,445
Stockholders' equity     92,818     95,358     94,716     87,196
  Total liab. and stockholders' equity   $ 927,051   $ 875,340   $ 897,724   $ 715,641
                         
Other Financial Information                        
                         
Allowance for loan losses   $ 9,748   $ 9,124   $ 8,582   $ 9,897
Nonperforming assets   $ 15,728   $ 19,124   $ 25,555   $ 21,845
Total gross loans   $ 567,912   $ 550,687   $ 556,131   $ 453,618
                         
                         

"During the third quarter, the Bank's loan production activity was up substantially. Borrowers are beginning to make additional real estate investments in our service area. Overall, our assets grew by 2.8% during the quarter. Our stockholders' equity increased during the third quarter by 3.0% and we remain "well capitalized" by regulatory definitions. As our capital base will allow, it is the intent of our Board to make additional redemptions of outstanding Small Business Lending Program preferred stock. The Oceanic Bank purchase has been fully integrated into the operations of the Company and our capital is growing in line with our growth in assets. Steps taken by management to prudently reduce our future noninterest expenses by closing some of our branch offices is making a difference. Our salary and benefit costs were $213,000 lower during the third quarter of 2013 when compared to the prior quarter. We understand that we must meet or exceed our customer's expectations relative to their banking experience with us in order for us to continue to grow and be a positive influence in the communities we serve. For 50 years, we have built our organization around the idea that we must continually earn our customer's 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

    Website: www.fnbnorcal.com