SOURCE: FNB Bancorp

FNB Bancorp

October 29, 2014 17:00 ET

First National Bank of Northern California Reports Third Quarter 2014 Earnings of $0.44 per Diluted Share

SOUTH SAN FRANCISCO, CA--(Marketwired - Oct 29, 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 third quarter of 2014 of $1,823,000 or $0.44 per diluted share, compared to net earnings available to common shareholders of $2,880,000 or $0.71 per diluted share for the third 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. 

"During the third quarter of 2014, we were able to grow our loan portfolio, our securities portfolio and our total assets. Our borrowers began to utilize their lines of credit more than they have during the second quarter and real estate prices in the San Francisco Bay Area continued to rise. According to the Zillow Home Value Index, San Francisco home values are up 12.4% for the twelve months ended September 30, 2014. We are carefully watching the valuations currently being provided on our residential and commercial real estate appraisals as valuations surpass the highs before the last recession. Deposit trends during the third quarter were not as favorable. Overall, our deposits were down approximately $8 million or 1% from June 30, 2014 levels. The largest percentage declines were in the certificate of deposit segment of our deposit portfolio as brokered CDs obtained in our Oceanic Bank acquisition continue to mature and not be renewed. Declines were also noted in our savings and money market depository accounts, although at a lower decline rate. Total FHLB advances outstanding at the end of the third quarter were $16 million. Management has and will continue to utilize this low cost funding source when it is prudent to do so," stated Tom McGraw, CEO.

   
   
Financial Highlights: Third Quarter, 2014  
   
  (Unaudited)  
Consolidated Statements of Earnings
(in 000s except share and earnings per share amounts)
Three months
ended
September 30,
2014
    Three months
ended
September 30,
2013
    Nine months
ended
September 30,
2014
    Nine months
ended
September 30,
2013
 
                         
Interest income   $ 9,300     $ 9,259     $ 27,544     $ 28,014  
Interest expense     538       560       1,562       1,881  
  Net interest income     8,762       8,699       25,982       26,133  
Provision for loan losses     -       (225 )     (75 )     (1,335 )
Noninterest income     1,041       978       3,067       3,046  
Noninterest expense     7,055       6,950       21,107       22,074  
  Income before income taxes     2,748       2,502       7,867       5,770  
(Provision for) benefit from income taxes     (925 )     629       (2,581 )     (330 )
  Net earnings     1,823       3,131       5,286       5,440  
  Dividends and discount accretion on preferred stock     -       251       170       581  
  Net earnings available to common shareholders   $ 1,823     $ 2,880     $ 5,116     $ 4,859  
                                 
Basic earnings per share   $ 0.45     $ 0.73     $ 1.27     $ 1.24  
Diluted earnings per share   $ 0.44     $ 0.71     $ 1.23     $ 1.21  
                                 
Average assets   $ 903,222     $ 903,868     $ 897,247     $ 900,794  
Average equity   $ 91,455     $ 89,728     $ 89,738     $ 92,994  
Return on average assets     0.81 %     1.27 %     1.14 %     0.72 %
Return on average equity     7.97 %     12.84 %     11.40 %     6.97 %
Efficiency ratio     72 %     72 %     73 %     76 %
Net interest margin (taxable equivalent)     4.20 %     4.23 %     4.23 %     4.34 %
Average shares outstanding     4,048       3,949       4,021       3,922  
Average diluted shares outstanding     4,175       4,045       4,156       4,015  
                                 
                                 
Financial Highlights: Third Quarter, 2014        
         
Consolidated Balance Sheets
(in '000s)
  (Unaudited)
As of
September 30,
2014
  *
As of
December 31,
2013
  (Unaudited)
As of
September 30,
2013
  *
As of
December 31,
2012
                 
  Assets:                
Cash and cash equivalents   $ 15,220   $ 14,007   $ 18,368   $ 27,861
Interest-bearing time deposits with other financial institutions     4,068     5,543     6,979     13,216
Securities available for sale, at fair value     267,924     263,988     285,610     234,945
Loans, net     568,533     552,343     558,164     541,563
Premises, equipment and leasehold improvements, net     12,239     12,512     12,631     12,706
Other real estate owned, net     755     5,318     6,675     6,650
Goodwill     1,841     1,841     1,841     1,841
Other equity securities     5,769     5,300     5,300     5,464
Accrued interest receivable     3,670     3,808     3,855     3,760
Prepaid expenses     444     701     741     1,372
Bank owned life insurance     12,424     12,151     12,065     11,785
Other assets     14,535     14,418     14,822     14,177
  Total assets   $ 907,422   $ 891,930   $ 927,051   $ 875,340
                         
Liabilities and stockholders' equity:                        
Deposits:                        
Demand and NOW   $ 284,196   $ 279,269   $ 263,480   $ 253,849
Savings and money market     393,929     370,194     387,275     343,437
Time     104,031     124,152     130,369     171,066
  Total deposits     782,156     773,615     781,124     768,352
Federal Home Loan Bank advances     16,000     15,000     44,000     1,220
Note payable     5,700     -     -     -
Accrued expenses and other liabilities     10,974     9,066     9,109     10,410
  Total liabilities     814,830     797,681     834,233     779,982
Stockholders' equity     92,592     94,249     92,818     95,358
  Total liab. and stockholders' equity   $ 907,422   $ 891,930   $ 927,051   $ 875,340
                         
* Excerpt from the audited annual financial statements                  
                         
Other Financial Information                        
Allowance for loan losses   $ 10,774   $ 9,879   $ 9,748   $ 9,124
Nonperforming assets   $ 5,875   $ 12,669   $ 15,728   $ 19,124
Total gross loans   $ 579,307   $ 562,222   $ 567,912   $ 550,687
                         
                         
                         

"During the third quarter, our net interest income and net interest margins increased when compared to the second quarter. The loan to deposit ratio increased to 74% at September 30, 2014 compared to 73% at year end. We are lending when it is prudent to do so, staying true to our conservative underwriting standards rather the increasing lending volume by accepting unwarranted risk into our loan pipeline. We continue to be 'well capitalized' by regulatory capital standards. The Bank's Tier 1 leverage capital ratio was 10.16% at September 30, 2014. The Bank's Tier 1 risk-based capital ratio was 13.05% and our total risk-based capital was 14.30%. We also continue to look for bank acquisitions. A Form 8-K was filed with the SEC on October 23, 2014 which provided additional information concerning our pending acquisition of Valley Community Bank," 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

    www.fnbnorcal.com