SOURCE: Guaranty Bancorp

Guaranty Bancorp

April 21, 2011 16:05 ET

Guaranty Bancorp Announces 2011 First Quarter Financial Results

DENVER, CO--(Marketwire - Apr 21, 2011) - Guaranty Bancorp (NASDAQ: GBNK)

--  Net income of $0.5 million (before non-cash preferred stock dividends)
--  Asset quality shows continued improvement highlighted by a 7.2%
    decrease in classified assets in the first quarter 2011 and a 2.7%
    decline in nonperforming assets
--  Continued growth in lower cost core deposits with $57.4 million of
    additional growth in the first quarter 2011
--  Capital and liquidity remain strong

Guaranty Bancorp (NASDAQ: GBNK) today reported first quarter 2011 net income of $0.5 million before preferred stock dividends compared to a net loss of $1.8 million before preferred stock dividends in the first quarter 2010. After giving effect to the preferred stock dividends, the loss per basic and diluted common share in the first quarter 2011 was $0.02 compared to a loss per basic and diluted common share of $0.06 for the same period in 2010.

The Company's net income before preferred stock dividends for the first quarter 2011 of $0.5 million is an increase of $2.4 million as compared to the first quarter 2010. On a pre-tax basis, the improvement in net income was $3.6 million for the first quarter 2011 as compared to 2010. This increase is primarily due to approximately $4.0 million in lower costs associated with problem assets, a $0.7 million reduction in other expenses and a $0.7 million gain on sale of securities, partially offset by a $1.9 million reduction in net interest income due mostly to lower loan balances.

Paul W. Taylor, Guaranty Bancorp's CFO and COO, stated, "We are very pleased with progress made in 2011 to improve the core operating metrics of the bank. The net income before our non-cash preferred stock dividends is attributable to the risk-reduction strategies employed during the past two years. As important, we continued to improve the asset quality of the bank while growing core deposits. After a 23% decrease in classified assets in 2010, classified assets declined by another 7.2% and nonperforming assets declined modestly in the first quarter 2011. Our low cost core deposits increased by $57.4 million, or 5.8%, during the first quarter 2011 due to our continued focus on growing our retail and business customer base. Even with the growth in core deposits, the interest expense associated with core deposits actually declined by $0.1 million due to lower rates on our core deposits. Additionally, we continue to strategically reduce higher cost time deposits. The $81.4 million decrease in time deposits in the first quarter 2011 resulted in a $0.5 million decrease in our interest expense."

As previously announced, the resignation of Dan Quinn, Guaranty Bancorp's President and CEO, will be effective as of the Company's Annual Meeting of Stockholders, which is scheduled for May 3, 2011. The Board of Directors is in the process of the search for a new CEO and President with the assistance of an executive search firm focused on the financial institutions industry. Several qualified candidates have been identified and are in the process of being interviewed.


Key Financial Measures


Income Statement

                                                Quarter Ended
                                    -------------------------------------
                                      March 31,  December 31,   March 31,
                                        2011         2010         2010
                                    -----------  -----------  -----------
                                      (Dollars in thousands, except per
                                                share amounts)

Income (loss) before taxes          $       514  $   (21,133) $    (3,072)
Net income (loss) before preferred
 stock dividends                            514      (21,133)      (1,845)
Preferred stock dividends                 1,486        1,453        1,360
Loss per common share after giving
 effect to preferred stock
 dividend-basic & diluted           $     (0.02) $     (0.44) $     (0.06)
Return on average assets                   0.11%       (4.32%)      (0.36%)
Net interest margin                        3.42%        3.39%        3.50%



Balance Sheet

                         March 31, December 31,  %      March 31,     %
                           2011       2010     Change     2010     Change
                         ---------  ---------  ------   ---------  ------
                         (Dollars in thousands, except per share amounts)
Cash and cash
 equivalents             $ 184,777  $ 141,465    30.6 % $ 222,723   (17.0)%
Total investments          409,126    418,668    (2.3)%   252,393    62.1 %
Total loans, net of
 unearned discount       1,126,083  1,204,580    (6.5)% 1,435,071   (21.5)%
Loans held for sale         14,200     14,200     0.0 %    11,506    23.4 %
Allowance for loan
 losses                    (46,879)   (47,069)   (0.4)%   (52,015)   (9.9)%
Total assets             1,834,457  1,870,052    (1.9)% 2,030,331    (9.6)%
Average assets,
 quarter-to-date         1,869,896  1,940,513    (3.6)% 2,066,930    (9.5)%
Total deposits           1,438,320  1,462,351    (1.6)% 1,602,884   (10.3)%
Book value per common
 share                        1.71       1.76    (2.8)%      2.44   (29.9)%
Tangible book value per
 common share                 1.47       1.50    (2.0)%      2.10   (30.0)%
Tangible book value per
 common share (after
 giving effect to
 conversion of
 preferred stock)             1.60       1.62    (1.2)%      1.98   (19.2)%
Book value of preferred
 stock                      66,297     64,818     2.3 %    60,580     9.4 %
Liquidation value of
 preferred stock            67,504     66,025     2.2 %    61,787     9.3 %
Equity ratio - GAAP           8.72%      8.57%    1.8 %      9.41%   (7.3)%
Tangible equity ratio         8.06%      7.88%    2.3 %      8.60%   (6.3)%
Total risk-based capital
 ratio                       15.82%     14.99%    5.5 %     14.28%   10.8 %



Net Interest Income and Margin


                                                  Quarter Ended
                                        ----------------------------------
                                         March 31,  December 31, March 31,
                                           2011        2010        2010
                                        ----------  ----------  ----------
                                              (Dollars in thousands)

Net interest income                     $   14,710  $   15,394  $   16,632
Interest rate spread                          3.05%       3.02%       3.10%
Net interest margin                           3.42%       3.39%       3.50%
Net interest margin, fully tax
 equivalent                                   3.49%       3.46%       3.58%


First quarter 2011 net interest income of $14.7 million decreased by $0.7 million from the fourth quarter 2010, and decreased by $1.9 million from the first quarter 2010. The Company's net interest margin of 3.42% for the first quarter 2011 reflected an increase of 3 basis points from the fourth quarter 2010 and a decrease of 8 basis points from the first quarter 2010.

The $0.7 million decrease in net interest income in the first quarter 2011 as compared to the fourth quarter 2010 is due mostly to a 12 basis point decline in the yield on loans coupled with a $70.2 million decrease in average loan balances. These two items contributed to a $1.7 million decline in interest income on loans. Partially offsetting this decrease in loan interest income was a $0.5 million increase in taxable investment security interest income and a $0.6 million decrease in deposit interest expense. The increase in interest income on taxable investments is due mostly to a $25.0 million increase in the average balances of such investments along with a 37 basis point increase in the yield on taxable investments. The decrease in deposit interest expense was due mostly to a $0.5 million decrease in time deposit interest expense due to management's continued strategy to reduce non-core time deposits. The average balance of time deposit accounts decreased by $76.5 million in the first quarter 2011 as compared to the fourth quarter 2010. In particular, during the last week of the first quarter 2011, a $33.6 million brokered time deposit with a rate of 4.25% matured and was not renewed. Although this did not have a significant impact on first quarter 2011 results, it is anticipated to reduce ongoing deposit interest expense. Throughout the remainder of 2011, the Company has approximately $98.2 million of brokered time deposits with a weighted average cost of 2.87% maturing that the Company does not expect to renew.

Net interest income decreased by $1.9 million in the first quarter 2011 as compared to the same quarter in 2010 due mostly to a $5.3 million decrease in loan interest income, partially offset by a $2.1 million decrease in deposit interest expense and a $1.5 million increase in interest on taxable investments. The decline in loan interest income was primarily attributable to a $303.4 million decrease in average loan volume as the Company worked to reduce its overall risk profile. Partially offsetting the impact of the decline in loan volume was an increase in the average balance of taxable investment securities by $190.6 million in the first quarter 2011 as compared to the same quarter in 2010. The cost of deposits decreased from 1.49% in the first quarter 2010 to 1.00% in the first quarter 2011 due primarily to a reduction in time deposit interest expense.


Noninterest Income

The following table presents noninterest income as of the dates indicated:

                                                  Quarter Ended
                                        -----------------------------------
                                         March 31, December 31,  March 31,
                                           2011        2010        2010
                                        ----------- ----------  -----------
                                              (Dollars in thousands)
Noninterest income:
  Customer service and other fees       $     2,314 $    2,430  $     2,214
  Gain on sale of securities                    714        216           14
  Other-than-temporary-impairment (OTTI)
   of securities                                  -     (3,500)           -
  Other                                         252        256          194
                                        ----------- ----------  -----------
  Total noninterest income              $     3,280 $     (598) $     2,422
                                        =========== ==========  ===========

The $3.9 million increase in noninterest income in the first quarter 2011 as compared to the fourth quarter 2010 is mostly due to a $3.5 million credit-related other-than-temporary-impairment (OTTI) recognized on a single, non-rated municipal bond in the fourth quarter 2010. This security was evaluated for impairment at the end of the first quarter 2011 and no changes to the initial OTTI was considered necessary on this bond. Additionally, the gain on sale of securities increased by $0.5 million in the first quarter 2011 as compared to the fourth quarter 2010.

The $0.9 million increase in noninterest income between the first quarter 2011 as compared to the same quarter in 2010 is primarily due to a $0.7 million gain on sale of securities.

Noninterest Expense

The following table presents noninterest expense as of the dates indicated:

                                                  Quarter Ended
                                        -----------------------------------
                                         March 31, December 31,  March 31,
                                           2011        2010        2010
                                        ----------- ----------- -----------
                                              (Dollars in thousands)
Noninterest expense:
  Salaries and employee benefits        $     6,615 $     6,456 $     6,563
  Occupancy expense                           1,883       1,783       1,890
  Furniture and equipment                       894         927         976
  Amortization of intangible assets           1,028       1,283       1,300
  Other real estate owned                       763       1,209       2,749
  Insurance and assessment                    1,225       1,336       1,812
  Professional fees                             908         824         877
  Other general and administrative            2,160       2,611       1,959
                                        ----------- ----------- -----------
  Total noninterest expense             $    15,476 $    16,429 $    18,126
                                        =========== =========== ===========

The $1.0 million decrease in noninterest expense in the first quarter 2011 as compared to the fourth quarter 2010 is due mostly to a $0.4 million decrease in expenses related to other real estate owned and a decrease of $0.5 million in other general and administrative expenses. The decrease in other real estate owned expense is primarily due to a reduction in net write-downs on other real estate owned properties resulting from valuation adjustments and sales. The decrease in other general and administrative expenses is due mostly to various reductions across all items of miscellaneous expense including advertising, data processing, communication and loan collection expenses.

The $2.7 million decrease in noninterest expense in the first quarter 2011 as compared to the same quarter in 2010 is due mostly to a $2.0 million decrease in expenses related to other real estate owned as well as a $0.6 million decrease in insurance and assessment expenses. The decrease in other real estate owned expense is due mostly to a reduction in net write-downs on other real estate owned properties. The decrease in insurance and assessment expenses is due mostly to a decrease in our risk category for FDIC insurance assessment purposes, as well as a decrease in overall deposits. Effective April 1, 2011, the FDIC insurance assessment rules have changed as a result of the Dodd-Frank Wall Street Reform and Consumer Protection Act. These new rules change the assessment base from total deposits to average total assets less tangible capital. The assessment rates have been lowered to account for the higher assessment base. The Company expects that these new rules will have a favorable impact on FDIC insurance assessments for the remainder of 2011. Had these new rules been in effect for the first quarter 2011, our FDIC insurance premium would have been reduced by approximately $0.2 million.

Preferred Stock Dividend

Effective February 15, 2011, a non-cash preferred stock dividend was paid in the form of additional shares of Series A convertible preferred stock to holders of Series A convertible preferred stock in the amount of $1.5 million.

Balance Sheet

                       March 31,  December 31,   %      March 31,    %
                         2011        2010     Change      2010     Change
                      ----------  ----------  ------   ----------  ------
                                     (Dollars in thousands)
Total assets          $1,834,457  $1,870,052    (1.9)% $2,030,331    (9.6)%
Average assets,
 quarter-to-date       1,869,896   1,940,513    (3.6)%  2,066,930    (9.5)%
Loans, net of
 unearned discount     1,126,083   1,204,580    (6.5)%  1,435,071   (21.5)%
Total deposits         1,438,320   1,462,351    (1.6)%  1,602,884   (10.3)%


Equity ratio - GAAP         8.72%       8.57%    1.8%        9.41%   (7.3)%
Tangible equity ratio       8.06%       7.88%    2.3%        8.60%   (6.3)%

At March 31, 2011, the Company had total assets of $1.8 billion, which represented a $35.6 million decline as compared to December 31, 2010 and a $195.9 million decrease as compared to March 31, 2010. The decline in assets from December 31, 2010 is mostly due to a $78.5 million decline in loans, net of unearned discount, partially offset by a $43.3 million increase in cash and due from banks over the same time period. This loan decline was due mostly to a $45.1 million decline in commercial loans and a $29.6 million decline in real estate loans. The increase in cash and due from banks is due to proceeds from the reduction of loans being held to fund anticipated reductions in brokered time deposits, purchase additional investment securities and fund future loan growth.

The following table sets forth the amounts of our loans outstanding
(excluding loans held for sale) at the dates indicated:


                                       March 31,  December 31,   March 31,
                                         2011         2010         2010
                                     -----------  -----------  -----------
                                                 (In thousands)
Loans on real estate:
  Residential and commercial         $   659,018  $   680,895  $   748,135
  Construction                            50,539       57,351      111,231
  Equity lines of credit                  49,399       50,289       53,014
Commercial loans                         305,627      350,725      448,908
Agricultural loans                        12,582       14,413       17,203
Lease financing                            3,143        3,143        4,014
Installment loans to individuals          26,942       28,582       34,986
Overdrafts                                   835          565          612
SBA and other                             19,543       20,443       19,396
                                     -----------  -----------  -----------
                                       1,127,628    1,206,406    1,437,499
Unearned discount                         (1,545)      (1,826)      (2,428)
                                     -----------  -----------  -----------
Loans, net of unearned discount      $ 1,126,083  $ 1,204,580  $ 1,435,071
                                     ===========  ===========  ===========

Since March 31, 2010, the ratio of construction, land and land development loans to capital has fallen by 28 percentage points to 77% at March 31, 2011. Similarly, the ratio of commercial real estate loans to capital has fallen by 59 percentage points to 268% at March 31, 2011. These ratios are below the regulatory commercial real estate concentration guidelines of 100% for land and construction loans and 300% for all investor real estate loans, respectively.

The following table sets forth the amounts of our deposits outstanding at
the dates indicated:

                                    March 31,   December 31,    March 31,
                                      2011          2010          2010
                                  ------------- ------------- -------------
                                               (In thousands)
Noninterest-bearing deposits      $     419,335 $     374,500 $     363,059
Interest-bearing demand                 184,305       178,042       165,315
Money market                            357,922       357,036       321,603
Savings                                  84,501        79,100        74,537
Time                                    392,257       473,673       678,370
                                  ------------- ------------- -------------
Total deposits                    $   1,438,320 $   1,462,351 $   1,602,884
                                  ============= ============= =============

Noninterest-bearing deposits as a percentage of total deposits increased to 29.2% at March 31, 2011, as compared to 25.6% at December 31, 2010 and 22.7% at March 31, 2010.

Deposits, other than time deposits, increased by $57.4 million, at March 31, 2011 as compared to December 31, 2010 and increased by $121.5 million as compared to March 31, 2010. The increases in non-maturity deposits were primarily attributable to the continued success of our business and retail strategic deposit gathering campaign. We plan to continue this deposit campaign, which includes a variety of different advertising media, throughout 2011.

Time deposits continue to decrease primarily as a result of management's efforts to reduce the overall level of higher cost time deposits, including brokered and internet deposits. Total brokered deposits at March 31, 2011 were $133.3 million as compared to $179.9 million at December 31, 2010 and $267.5 million at March 31, 2010. In addition to this $134.2 million decline in brokered deposits over the past twelve months, we also experienced a $60.3 million decline in internet time deposits over the same time period. The remaining decline in time deposits is primarily related to the non-renewal of other higher cost certificates of deposits. Management monitors time deposit maturities and renewals on a daily basis and will raise rates on local time deposits if necessary to grow such deposits.

Borrowings were $163.2 million at March 31, 2011 as compared to $163.2 million at December 31, 2010 and $164.3 million at March 31, 2010. The entire balance of borrowings at each balance sheet date consisted of term advances with the Federal Home Loan Bank.


Regulatory Capital Ratios

All of the regulatory capital ratios are above the highest regulatory
capital threshold of "well-capitalized" at March 31, 2011.  The Company's
and the subsidiary bank's actual capital ratios for March 31, 2011 and
December 31, 2010 are presented in the table below:

                                                                Minimum
                                                              Requirement
                         Ratio at    Ratio at     Minimum      for "Well
                         March 31, December 31,   Capital     Capitalized"
                           2011        2010     Requirement   Institution
                         ---------  ----------  ------------  ------------

Total Risk-Based Capital
 Ratio:
  Consolidated               15.82%      14.99%         8.00%          N/A
  Guaranty Bank and Trust
   Company                   14.96%      14.07%         8.00%        10.00%
Tier 1 Risk-Based
 Capital Ratio:
  Consolidated                8.79%       8.57%         4.00%          N/A
  Guaranty Bank and Trust
   Company                   13.68%      12.80%         4.00%         6.00%
Leverage Ratio:
  Consolidated                6.29%       6.25%         4.00%          N/A
  Guaranty Bank and Trust
   Company                    9.80%       9.33%         4.00%         5.00%

Generally, the allowance for loan losses is included in total capital for regulatory purposes; however, it is limited to 1.25% of total risk-weighted assets. At March 31, 2011, approximately $30.0 million of the subsidiary bank's allowance for loan losses was disallowed from being included in total risk-based capital under the regulatory capital rules, or approximately 2.25% of the subsidiary bank's risk-weighted assets. In addition, approximately $1.3 million of deferred tax assets were disallowed for purposes of computing Tier 1 capital.

Asset Quality

The following table presents selected asset quality data (excluding loans
held for sale) as of the dates indicated:


                             March   December  September  June     March
                           31, 2011  31, 2010  30, 2010  30, 2010 31, 2010
                            -------  --------  --------  -------  --------
                                        (Dollars in thousands)

Nonaccrual loans, not
 restructured               $62,650  $ 74,304  $ 65,921  $64,339  $ 70,500
Other nonperforming loans     1,506     3,317     4,420    1,065       558
                            -------  --------  --------  -------  --------

Total nonperforming loans
 (NPLs)                     $64,156  $ 77,621  $ 70,341  $65,404  $ 71,058
Other real estate owned and
 foreclosed  assets          33,611    22,898    45,700   30,298    30,918
                            -------  --------  --------  -------  --------

Total nonperforming assets
 (NPAs)                     $97,767  $100,519  $116,041  $95,702  $101,976
                            =======  ========  ========  =======  ========

Accruing loans past due 90
 days or more (1)           $ 1,506  $  3,317  $  4,420  $ 1,065  $    558
                            =======  ========  ========  =======  ========

Accruing loans past due
 30-89 days (1)             $14,593  $ 21,555  $ 21,876  $33,050  $ 21,956
                            =======  ========  ========  =======  ========

Allowance for loan losses   $46,879  $ 47,069  $ 41,898  $46,866  $ 52,015
                            =======  ========  ========  =======  ========

Selected ratios:
NPLs to loans, net of
 unearned discount             5.70%     6.44%     5.45%    4.76%     4.95%
NPAs to total assets           5.33%     5.38%     6.00%    4.82%     5.02%
Allowance for loan losses
 to NPAs                      47.95%    46.83%    36.11%   48.97%    51.01%
Allowance for loan losses
 to NPLs                      73.07%    60.64%    59.56%   71.66%    73.20%
Allowance for loan losses
 to loans, net of  unearned
 discount                      4.16%     3.91%     3.25%    3.41%     3.62%
Loans 30-89 days past due
 to loans, net  of unearned
 discount                      1.30%     1.79%     1.70%    2.40%     1.53%

(1)Past due loans include both loans that are past due with respect to
payments and loans that are past due because the loan has matured, and are
in the process of renewal, but continue to be current with respect to
payments.

The $10.7 million increase in other real estate owned at March 31, 2011 as compared to December 31, 2010 is primarily attributable to the addition of $11.9 million related to two similar properties from the same borrower that are expected to be sold during the next two quarters for a full recovery of our cost basis.

The types of nonperforming loans (excluding loans held for sale) as of
March 31, 2011 and December 31, 2010 are as follows:

                        ---------------------------------------------------
                                        Nonperforming Loans
                        ---------------------------------------------------
                             March 31, 2011           December 31, 2010
                        ------------------------- -------------------------
                         Loan            Related   Loan            Related
                        Balance Percent Allowance Balance Percent Allowance
                        ------- ------- --------- ------- -------  --------
                                      (Dollars in thousands)
Residential
 Construction, Land
 and Land Development   $ 6,722    10.5% $    742 $ 7,254     9.3% $    295
Other Residential Loans   6,058     9.4%    1,695   7,524     9.7%      583
Commercial and
 Industrial Loans        19,057    29.7%    3,608  19,955    25.7%    1,940
Commercial Real Estate   32,287    50.3%    6,091  42,833    55.2%    3,840
Other                        32     0.1%        -      55     0.1%        1
                        ------- ------- --------- ------- -------  --------
Total                   $64,156   100.0% $ 12,136 $77,621   100.0% $  6,659
                        ======= =======  ======== ======= =======  ========

The $13.5 million decrease in nonperforming loans during the first quarter 2011 is mostly due to the foreclosure on two properties related to one loan relationship with an aggregate value of $11.9 million. The specific allowance associated with nonperforming loans increased during the first quarter 2011 primarily due to updated valuations and broker opinions on properties that the Company plans to dispose of in an expeditious manner.

The types of loans included in the accruing loans past due 30-89 days as of
March 31, 2011 and December 31, 2010 are as follows:

                                        ----------------------------------
                                        Accruing loans past due 30-89 days
                                        ----------------------------------
                                         March 31, 2011   December 31, 2010
                                        ----------------------------------
                                          Loan              Loan
                                        Balance  Percent  Balance  Percent
                                        -------- -------  -------- -------
                                              (Dollars in thousands)
Residential Construction, Land and
 Land Development                       $  3,302    22.6% $  2,770    12.9%
Other Residential Loans                    1,220     8.4%    1,444     6.7%
Commercial and Industrial Loans            5,810    39.8%    7,594    35.2%
Commercial Real Estate                     1,305     8.9%    4,047    18.8%
Other                                      2,956    20.3%    5,700    26.4%
                                        -------- -------  -------- -------
Total                                   $ 14,593   100.0% $ 21,555   100.0%
                                        ======== =======  ======== =======

Net charge-offs in the first quarter 2011 were $2.2 million as compared to $14.3 million in the fourth quarter 2010 and $4.0 million in the first quarter 2010. The majority of the charge-offs in the first quarter 2011 related to a single loan relationship.

In addition to the $12.1 million of allowance specifically allocated to impaired loans, the Company had partially charged-off $10.0 million of the impaired loans on the balance sheet as of March 31, 2011 in prior periods. These prior period partial charge-offs have reduced the specific component of our allowance for loan losses. The general component of the allowance for loan losses decreased to $34.7 million at March 31, 2011, or 3.09% of loans, net of unearned discount, as compared to $40.4 million, or 3.36% of loans, net of unearned discount, at the end of the previous quarter. The decrease in the general component of the allowance for loan losses during the first quarter is primarily attributable to a decrease in the balance of the loan portfolio subject to a general allowance for loan losses and a declining trend in net charge-offs within the Company's historical look-back period. This caused a decrease in our historical loss component of the allowance for loan losses.

The Company recorded a provision for loan losses in the first quarter 2011 of $2.0 million, as compared to $19.5 million in the fourth quarter 2010 and $4.0 million in the first quarter 2010. The decrease in the provision for loan losses was the result of the reduction in the general component of the allowance for loan losses due mostly to a significant reduction in the level of historical chargeoffs in our look-back period, a decrease in classified assets and a decline in the overall loan portfolio subject to a general allowance for loan losses.

Shares Outstanding

As of March 31, 2011, the Company had 54,034,095 shares of common stock outstanding, including 2,295,836 shares of unvested stock awards, but excluding 156,567 shares of common stock to be issued under its deferred compensation plan. In addition, the Company had 67,504 shares of Series A convertible preferred stock outstanding, with a liquidation value of $1,000 per share.

Non-GAAP Financial Measures

This press release includes non-GAAP financial measures related to tangible assets, including tangible book value, tangible book value after giving effect to conversion of preferred stock, and tangible equity ratio, all of which exclude intangible assets.

The Company discloses these non-GAAP financial measures to provide meaningful supplemental information regarding the Company's operational performance and to enhance investors' overall understanding of the Company's core financial performance. Management believes that these non-GAAP financial measures allow for additional transparency and are used by some investors, analysts and other users of the Company's financial information as performance measures. These non-GAAP financial measures are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with GAAP. These non-GAAP financial measures presented by the Company may be different from non-GAAP financial measures used by other companies.

The following non-GAAP schedules reconcile the book value per share to the
tangible book value per share and the GAAP equity ratio to the tangible
equity ratio as of the dates indicated:

                                      March 31,   December 31,  March 31,
                                         2011         2010         2010
                                     -----------  -----------  -----------
                                            (Dollars in thousands,
                                           except per share amounts)
Tangible Book Value per Common Share
  Total stockholders' equity         $   159,920  $   160,283  $   190,980
  Less: Preferred share liquidation
   preference                            (67,504)     (66,025)     (61,787)
                                     -----------  -----------  -----------
  Stockholders' equity attributable
   to common shares                       92,416       94,258      129,193
  Less: Intangible assets                (13,026)     (14,054)     (17,922)
                                     -----------  -----------  -----------
  Tangible common equity             $    79,390  $    80,204  $   111,271
                                     ===========  ===========  ===========

  Number of common shares outstanding
   and to be issued                   54,190,662   53,529,950   52,982,035

  Book value per common share        $      1.71  $      1.76  $      2.44
  Tangible book value per common
   share                             $      1.47  $      1.50  $      2.10

  Total Stockholders' equity         $   159,920  $   160,283  $   190,980
  Less: Intangible assets                (13,026)     (14,054)     (17,922)
                                     -----------  -----------  -----------
  Tangible common equity (after
   giving effect to conversion of
   preferred stock)                  $   146,894  $   146,229  $   173,058
                                     ===========  ===========  ===========

  Number of shares of preferred stock
   outstanding                            67,504       66,025       61,787
  Number of shares of common stock
   to be issued upon conversion of
   preferred stock                    37,502,222   36,680,556   34,326,111
  Total number of shares of common
   stock outstanding and to be
   issued (after giving effect to
   conversion of preferred stock)     91,692,884   90,210,506   87,308,146

  Tangible book value per common
   share (after giving effect to
   conversion of preferred stock)    $      1.60  $      1.62  $      1.98



Tangible Equity Ratio
                                      March 31,   December 31,  March 31,
                                         2011         2010         2010
                                     -----------  -----------  -----------
                                            (Dollars in thousands,
                                           except per share amounts)

  Total stockholders' equity         $   159,920  $   160,283  $   190,980
  Less: Intangible assets                (13,026)     (14,054)     (17,922)
                                     -----------  -----------  -----------
  Tangible equity                    $   146,894  $   146,229  $   173,058
                                     ===========  ===========  ===========

  Total assets                       $ 1,834,457  $ 1,870,052  $ 2,030,331
  Less: Intangible assets                (13,026)     (14,054)     (17,922)
                                     ===========  ===========  ===========
  Tangible assets                    $ 1,821,431  $ 1,855,998  $ 2,012,409
                                     ===========  ===========  ===========

  Equity ratio - GAAP  (Total
   stockholders' equity / total
   assets)                                  8.72%        8.57%        9.41%
  Tangible equity ratio (Tangible
   equity / tangible assets)                8.06%        7.88%        8.60%

About Guaranty Bancorp

Guaranty Bancorp is a bank holding company that operates 34 branches in Colorado through a single bank, Guaranty Bank and Trust Company. The bank provides banking and other financial services including real estate, construction, commercial and industrial, energy, consumer and agricultural loans throughout its targeted Colorado markets to consumers and small to medium-sized businesses, including the owners and employees of those businesses. The bank also provides trust services, including personal trust administration, estate settlement, investment management accounts and self-directed IRAs. More information about Guaranty Bancorp can be found at www.gbnk.com.

Forward-Looking Statements

This press release contains forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "plans," "intends," "anticipates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of such terms and other comparable terminology. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: failure to maintain adequate levels of capital and liquidity to support Company's operations; the effect of the regulatory written agreement the Company and its bank subsidiary have entered into and potential future supervisory action against the Company or its bank subsidiary; general economic and business conditions in those areas in which the Company operates; demographic changes; competition; fluctuations in interest rates; continued ability to attract and employ qualified personnel; ability to receive regulatory approval for our bank subsidiary to declare dividends to the Company; adequacy of our allowance for loan losses, changes in credit quality and the effect of credit quality on our provision for credit losses and allowance for loan losses; changes in governmental legislation or regulation, including, but not limited to, any increase in FDIC insurance premiums; changes in accounting policies and practices; changes in the deferred tax asset valuation allowance; changes in business strategy or development plans; changes in the securities markets; changes in consumer spending, borrowing and savings habits; the availability of capital from private or government sources; competition for loans and deposits and failure to attract or retain loans and deposits; changes in the financial performance and/or condition of our borrowers and the ability of our borrowers to perform under the terms of their loans and other terms of credit agreements; political instability, acts of war or terrorism and natural disasters; and additional "Risk Factors" referenced in the Company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, as supplemented from time to time. When relying on forward-looking statements to make decisions with respect to the Company, investors and others are cautioned to consider these and other risks and uncertainties. The Company can give no assurance that any goal or plan or expectation set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. The forward-looking statements are made as of the date of this press release, and the Company does not intend, and assumes no obligation, to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.

                    GUARANTY BANCORP AND SUBSIDIARIES
                  Unaudited Consolidated Balance Sheets

                                      March 31,   December 31,  March 31,
                                         2011         2010        2010
                                     -----------  -----------  -----------
                                                 (In thousands)
Assets
Cash and due from banks              $   184,777  $   141,465  $   222,723

Securities available for sale, at
 fair value                              381,310      389,530      219,490
Securities held to maturity               11,284       11,927       15,760
Bank stocks, at cost                      16,532       17,211       17,143
                                     -----------  -----------  -----------
     Total investments                   409,126      418,668      252,393
                                     -----------  -----------  -----------

Loans, net of unearned discount        1,126,083    1,204,580    1,435,071
  Less allowance for loan losses         (46,879)     (47,069)     (52,015)
                                     -----------  -----------  -----------
     Net loans                         1,079,204    1,157,511    1,383,056
                                     -----------  -----------  -----------

Loans held for sale                       14,200       14,200       11,506
Premises and equipment, net               56,688       57,399       59,587
Other real estate owned and
 foreclosed assets                        33,611       22,898       30,918
Other intangible assets, net              13,026       14,054       17,922
Other assets                              43,825       43,857       52,226
                                     -----------  -----------  -----------
     Total assets                    $ 1,834,457  $ 1,870,052  $ 2,030,331
                                     ===========  ===========  ===========

Liabilities and Stockholders' Equity
Liabilities:
  Deposits:
   Noninterest-bearing demand        $   419,335  $   374,500  $   363,059
   Interest-bearing demand               542,227      535,078      486,918
   Savings                                84,501       79,100       74,537
   Time                                  392,257      473,673      678,370
                                     -----------  -----------  -----------
     Total deposits                    1,438,320    1,462,351    1,602,884
                                     -----------  -----------  -----------
Securities sold under agreements to
 repurchase and federal funds
 purchased                                18,303       30,113       18,387
Borrowings                               163,215      163,239      164,310
Subordinated debentures                   41,239       41,239       41,239
Interest payable and other
 liabilities                              13,460       12,827       12,531
                                     -----------  -----------  -----------
     Total liabilities                 1,674,537    1,709,769    1,839,351
                                     -----------  -----------  -----------

Stockholders' equity:
  Preferred stock and Additional
   paid-in capital - Preferred stock      66,297       64,818       60,580
  Common stock and Additional
   paid-in capital - Common stock        619,706      619,509      618,779
  Shares to be issued for deferred
   compensation obligations                  237          237          237
  Accumulated deficit                   (420,534)    (419,562)    (385,804)
  Accumulated other comprehensive
   income (loss)                          (3,275)      (2,220)        (341)
  Treasury Stock                        (102,511)    (102,499)    (102,471)
                                     -----------  -----------  -----------
     Total stockholders' equity          159,920      160,283      190,980
                                     -----------  -----------  -----------
     Total liabilities and
      stockholders' equity           $ 1,834,457  $ 1,870,052  $ 2,030,331
                                     ===========  ===========  ===========





                    GUARANTY BANCORP AND SUBSIDIARIES
             Unaudited Consolidated Statements of Operations

                                                      Three Months Ended
                                                          March 31,
                                                    ----------------------
                                                       2011        2010
                                                    ----------  ----------
                                                    (In thousands, except
                                                      share and per share
                                                            data)
Interest income:
  Loans, including fees                             $   15,534  $   20,784
  Investment securities:
    Taxable                                              3,065       1,516
    Tax-exempt                                             489         720
  Dividends                                                166         185
  Federal funds sold and other                              89         116
                                                    ----------  ----------
    Total interest income                               19,343      23,321
                                                    ----------  ----------
Interest expense:
  Deposits                                               2,629       4,713
  Securities sold under agreement to repurchase and
   federal funds purchased                                  24          43
  Borrowings                                             1,289       1,301
  Subordinated debentures                                  691         632
                                                    ----------  ----------
    Total interest expense                               4,633       6,689
                                                    ----------  ----------
    Net interest income                                 14,710      16,632
Provision for loan losses                                2,000       4,000
                                                    ----------  ----------
    Net interest income, after provision for loan
     losses                                             12,710      12,632
Noninterest income:
  Customer service and other fees                        2,314       2,214
  Gain on sale of securities                               714          14
  Other                                                    252         194
                                                    ----------  ----------
    Total noninterest income                             3,280       2,422
Noninterest expense:
  Salaries and employee benefits                         6,615       6,563
  Occupancy expense                                      1,883       1,890
  Furniture and equipment                                  894         976
  Amortization of intangible assets                      1,028       1,300
  Other real estate owned, net                             763       2,749
  Insurance and assessments                              1,225       1,812
  Professional fees                                        908         877
  Other general and administrative                       2,160       1,959
                                                    ----------  ----------
    Total noninterest expense                           15,476      18,126
                                                    ----------  ----------
    Income (loss) before income taxes                      514      (3,072)
Income tax benefit                                           -      (1,227)
                                                    ----------  ----------
    Net Income (loss)                                      514      (1,845)
Preferred stock dividends                               (1,486)     (1,360)
                                                    ----------  ----------
Net loss applicable to common stockholders          $     (972) $   (3,205)
                                                    ==========  ==========

Loss per common share-basic:                        $    (0.02) $    (0.06)
Loss per common share-diluted:                           (0.02)      (0.06)


Weighted average common shares outstanding-basic    51,775,475  51,607,044
Weighted average common shares outstanding-diluted  51,775,475  51,607,044




                    GUARANTY BANCORP AND SUBSIDIARIES
              Unaudited Consolidated Average Balance Sheets

                                                    QTD Average
                                          ---------------------------------
                                           March 31, December 31, March 31,
                                             2011       2010        2010
                                          ---------- ----------- ----------
                                                   (In thousands)
Assets
Interest earning assets
  Loans, net of unearned discount         $1,189,220 $ 1,259,392 $1,492,630
  Securities                                 416,991     402,101    245,518
  Other earning assets                       136,063     141,025    190,302
                                          ---------- ----------- ----------
Average earning assets                     1,742,274   1,802,518  1,928,450
Other assets                                 127,622     137,995    138,480
                                          ---------- ----------- ----------

Total average assets                      $1,869,896 $ 1,940,513 $2,066,930
                                          ========== =========== ==========


Liabilities and Stockholders' Equity
Average liabilities:
Average deposits:
  Noninterest-bearing deposits            $  400,979 $   374,004 $  352,937
  Interest-bearing deposits                1,067,156   1,137,216  1,282,119
                                          ---------- ----------- ----------
  Average deposits                         1,468,135   1,511,220  1,635,056
Other interest-bearing liabilities           226,602     228,375    224,856
Other liabilities                             14,123      14,604     13,105
                                          ---------- ----------- ----------
Total average liabilities                  1,708,860   1,754,199  1,873,017
Average stockholders' equity                 161,036     186,314    193,913
                                          ---------- ----------- ----------

Total average liabilities and
 stockholders' equity                     $1,869,896 $ 1,940,513 $2,066,930
                                          ========== =========== ==========




                             GUARANTY BANCORP
                    Unaudited Credit Quality Measures

                                             Quarter Ended
                          ------------------------------------------------
                          March 31, December  September  June 30, March 31,
                            2011    31, 2010  30, 2010    2010      2010
                          --------  --------  --------  --------  --------
                                       (Dollars in thousands)
Nonaccrual loans and
 leases, not restructured $ 62,650  $ 74,304  $ 65,921  $ 64,339  $ 70,500
Other nonperforming loans    1,506     3,317     4,420     1,065       558
                          --------  --------  --------  --------  --------
  Total nonperforming
   loans                  $ 64,156  $ 77,621  $ 70,341  $ 65,404  $ 71,058
                          --------  --------  --------  --------  --------
Other real estate owned
 and foreclosed  assets     33,611    22,898    45,700    30,298    30,918
                          --------  --------  --------  --------  --------
  Total nonperforming
   assets                 $ 97,767  $100,519  $116,041  $ 95,702  $101,976
                          ========  ========  ========  ========  ========


Impaired loans            $ 64,156  $ 77,621  $ 70,341  $ 65,404  $ 71,058
 Allocated allowance for
  loan losses              (12,136)   (6,659)   (3,539)   (3,716)  (10,802)
                          --------  --------  --------  --------  --------
    Net investment in
     impaired loans       $ 52,020  $ 70,962  $ 66,802  $ 61,688  $ 60,256
                          ========  ========  ========  ========  ========


Accruing loans past due
 90 days or more          $  1,506  $  3,317  $  4,420  $  1,065  $    558
                          ========  ========  ========  ========  ========


Accruing loans past due
 30-89 days               $ 14,593  $ 21,555  $ 21,876  $ 33,050  $ 21,956
                          ========  ========  ========  ========  ========

Charged-off loans         $  2,851  $ 14,635  $  7,953  $ 13,918  $  4,271
 Recoveries                   (661)     (306)     (485)     (369)     (295)
                          --------  --------  --------  --------  --------
    Net charge-offs       $  2,190  $ 14,329  $  7,468  $ 13,549  $  3,976
                          ========  ========  ========  ========  ========


Provision for loan losses $  2,000  $ 19,500  $  2,500  $  8,400  $  4,000
                          ========  ========  ========  ========  ========

Allowance for loan losses $ 46,879  $ 47,069  $ 41,898  $ 46,866  $ 52,015
                          ========  ========  ========  ========  ========

Allowance for loan losses
 to loans, net of
 unearned discount            4.16%     3.91%     3.25%     3.41%     3.62%
Allowance for loan losses
 to nonaccrual loans         74.83%    63.35%    63.56%    72.84%    73.78%
Allowance for loan losses
 to nonperforming assets     47.95%    46.83%    36.11%    48.97%    51.01%
Allowance for loan losses
 to nonperforming loans      73.07%    60.64%    59.56%    71.66%    73.20%
Nonperforming assets to
 loans, net of  unearned
 discount, and other
 real estate owned            8.43%     8.19%     8.69%     6.81%     6.96%
Nonperforming assets to
 total assets                 5.33%     5.38%     6.00%     4.82%     5.02%
Nonaccrual loans to loans,
 net of unearned discount     5.56%     6.17%     5.11%     4.68%     4.91%
Nonperforming loans to
 loans, net of unearned
 discount                     5.70%     6.44%     5.45%     4.76%     4.95%
Annualized net charge-offs
 to average loans             0.75%     4.51%     2.19%     3.83%     1.08%

Contact Information

  • Contact Information

    For more information, please contact:

    Daniel M. Quinn
    President & Chief Executive Officer
    Guaranty Bancorp
    1331 Seventeenth Street, Suite 345
    Denver, CO 80202
    303/313-6763

    Paul W. Taylor
    E.V.P., Chief Financial & Operating Officer & Secretary
    Guaranty Bancorp
    1331 Seventeenth Street, Suite 345
    Denver, CO 80202
    303/293-5563