Premier Service Bank Announces Third Quarter Financial Results
Premier Service Bank PSBK, a California state-chartered bank headquartered in Riverside, California, released the results of its operations for the third quarter of 2006.
News
At September 30, 2006, the bank reported total assets of $138.9 million, representing a 17% increase over September 30, 2005. Deposits closed at $126.7 million, representing an increase of 17% over September 30, 2005. Gross loans grew to $94.5 million, representing a 52% increase over September 30, 2005. Unfunded credit commitments increased to $33.5 million at September 30, 2006, representing a 19% increase over September 30, 2005. Total shareholders' equity at September 30, 2006 increased to $11.6 million, a 22% increase over the $9.5 million reported as of September 30, 2005.
For the quarter ended September 30, 2006 the bank reported net income of $499.2 thousand, representing a 4% increase over the $481.6 thousand net income reported for the comparable period ended September 30, 2005. For the nine months ended September 30, 2006, the bank reported net income of $1.3 million; representing a 31% increase over the $1.0 million operating profit reported for the comparable period ended September 30, 2005.
For the third quarter of 2006, net interest income totaled $1.7 million, representing an increase of $330 thousand, or 24%, over the same period in the prior year. Interest income increased $739 thousand, or 47%, which was partly offset by an increase in interest expense of $410 thousand. For the first nine months of 2006, net interest income totaled $5.0 million, representing an increase of $1.3 million, or 34%, over the same period in the prior year. Interest income increased $2.2 million, or 53%, which was partly offset by an increase in interest expense of $937 thousand. Interest income increased mostly as the result of the growth in loans and an increase in interest rates. Interest expense increased due to the growth in deposits and the increase in interest rates on those deposits. Net interest margin was 5.87% for the ninth month period ended September 30, 2006, which represented an increase of 7% when compared to the 5.51% reported for the nine month period ended September 30, 2005.
For the quarter ended September 30, 2006, the bank recorded stock option expense of $28 thousand and for the nine months ended September 30, 2006, stock option expense totaling $84 thousand pursuant to the requirements of SFAS 123 (r) "Share-Based Payments." Previously, the bank followed the intrinsic value method, which did not require the recording of stock option expense.
Earnings per basic share for the quarter ended September 30, 2006 were $0.41 compared to the earnings per basic share of $0.40 reported for the quarter ended September 30, 2005.
It should also be noted that, beginning in the fourth quarter of 2006, the bank will begin accruing for the payment of state and federal income taxes for the first time in its history. As the bank uses the last of its tax benefits and transitions to a fully taxable entity, reportable net income will likely decline temporarily and comparisons to prior period income levels will be affected negatively.
"Our focus continues to be centered in developing and nurturing long-term relationship opportunities for the institution," said Kerry Pendergast, President and CEO of the bank. "Our success in this area is predicated on providing our clients with the products and services that their relationships require, while, at the same time, working to insure that we are always accessible and communicative," Pendergast said in closing.
Forward-looking Statements
This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about Premier Service Bank's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and in the following: Premier Service Bank's ability to continue to increase its assets, deposits and total loans, control expenses, retain critical personnel, manage interest rate risk, manage technological changes, address regulatory requirements, and other risks discussed from time to time in Premier Service Bank's filings and reports with the Federal Deposit Insurance Corporation. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and Premier Service Bank does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
Financial Data - Premier Service Bank (Unaudited)
Quarter Ended
-------------------------------------------------
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,
(In Thousands) 2006 2006 2006 2005 2005
-------------------- --------- --------- --------- --------- ---------
Interest income (not
taxable equivalent) $2,303 $2,115 $1,934 $1,770 $1,564
Interest expense 600 442 280 254 190
--------- --------- --------- --------- ---------
Net interest income 1,703 1,673 1,654 1,516 1,374
Provision for loan
losses 40 36 166 60 20
--------- --------- --------- --------- ---------
Net interest income
after provision for
loan losses 1,663 1,637 1,488 1,456 1,354
Non-interest income 167 137 135 123 124
Non-interest expense 1,457 1,365 1,375 1,127 1,101
--------- --------- --------- --------- ---------
Income before income
taxes 373 409 248 452 377
(Benefit)/Provision
for income taxes (126) (75) (89) (180) (105)
--------- --------- --------- --------- ---------
Net income $499 $484 $337 $632 $482
--------- --------- --------- --------- ---------
Quarter
Ended
-------------------------------------------------
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,
(In Thousands) 2006 2006 2006 2005 2005
-------------------- --------- --------- --------- --------- ---------
Per share:
Net income - basic $0.41 $0.40 $0.28 $0.52 $0.40
Weighted average
shares used in
basic 1,220 1,218 1,218 1,218 1,218
Book value at
period end $9.48 $8.89 $8.53 $8.27 $7.80
Ending shares 1,220 1,220 1,218 1,218 1,218
Balance Sheet - At
Period-End
Cash and due from
banks $8,897 $9,534 $8,244 $8,074 $9,363
Investments and
Fed fund sold 31,338 32,201 31,430 41,375 45,556
Gross Loans 94,540 86,886 81,971 67,486 62,367
Deferred fees (262) (272) (242) (245) (230)
Allowance for loan
losses (1,051) (1,010) (975) (810) (750)
Net Loans 93,227 85,604 80,754 66,431 61,387
Other assets 5,480 5,234 2,561 2,249 2,049
--------- --------- --------- --------- ---------
Total Assets $138,942 $132,573 $122,989 $118,129 $118,355
--------- --------- --------- --------- ---------
Non-interest-bearing
deposits $48,132 $47,057 $47,065 $50,276 $46,267
Interest-bearing
deposits 78,587 74,137 65,173 57,459 62,300
Other liabilities 660 535 363 328 291
Shareholders' equity 11,563 10,844 10,388 10,066 9,497
--------- --------- --------- --------- ---------
Total Liabilities
and Shareholders' $138,942 $132,573 $122,989 $118,129 $118,355
--------- --------- --------- --------- ---------
Asset Quality &
Capital - At
Period-End
Non-accrual loans $- $- $- $- $-
Loans past due 90
days or more 437 - - - -
Other real estate
owned - - - - -
--------- --------- --------- --------- ---------
Total non-
performing assets $437 $- $- $- $-
--------- --------- --------- --------- ---------
Allowance for
losses to loans,
gross 1.1% 1.2% 1.2% 1.2% 1.2%
Non-accrual loans
to total loans,
gross N/A N/A N/A N/A N/A
Non-performing
asset to total
assets 0.0% N/A N/A N/A N/A
Allowance for
losses to non-
performing loans N/A N/A N/A N/A N/A
Total capital to
risk-adjusted
assets 11.9% 12.2% 13.0% 14.3% 14.1%
Tier one capital
to risk-adjusted
assets 10.9% 11.1% 11.9% 13.2% 13.0%
Equity to average
assets (leverage
ratio) 8.7% 8.8% 9.0% 8.6% 8.6%
Contact Information: Premier Service Bank Kerry L. Pendergast, President and CEO or F. Dean Fletcher, Executive Vice President and CFO 951-274-2400
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