American Perspective Bank Announces Fourth Quarter and Full Year 2011 Financial Results
SAN LUIS OBISPO, Calif., Jan. 20, 2012 /PRNewswire/ -- American Perspective Bank (OTC Bulletin Board: APBA) (the "Bank") today announced fourth quarter and year to date consolidated financial results through December 31, 2011. Net income during the fourth quarter of 2011 was $1.5 million, equivalent to $0.34 diluted earnings per share. The fourth quarter 2011 earnings benefited from the recognition of $676 thousand in tax benefits primarily associated with the reversal of the valuation allowance against the Bank's net deferred tax assets. Based upon factors including the Bank's being profitable for the past nine consecutive quarters, the valuation allowance was eliminated because it is more likely than not that the Bank will be able to utilize the net deferred tax assets.
Income before income taxes was $804 thousand during the fourth quarter of 2011, constituting the highest pre-tax quarterly earnings in the Bank's history. The fourth quarter 2011 earnings compared favorably to net income of $165 thousand during the fourth quarter of 2010, equivalent to $0.04 diluted earnings per share. The primary factor associated with the increased earnings during the fourth quarter of 2011 versus the fourth quarter of 2010 was a 25.0% rise in net interest income. Net income during the third quarter of 2011 (the immediately preceding quarter) was $403 thousand, equivalent to $0.09 diluted earnings per share.
Net income for the full year 2011 was $2.8 million, or $0.64 diluted earnings per share. This compares favorably to net income of $478 thousand for the full year 2010, equivalent to $0.11 diluted earnings per share. Factors contributing to the increase in year over year profitability, in addition to the aforementioned tax benefit, included:
- Net interest income was 25.9% greater during 2011 compared to 2010, as the Bank benefited from both a larger average balance of interest earning assets and an expanded net interest margin.
- Provision for loan losses was $410 thousand lower in 2011 versus 2010, primarily due to the Bank's recording no net charge-offs in 2011 compared to $1.3 million in net charge-offs during 2010.
The Bank reported record levels of net loans, deposits, and total assets as of December 31, 2011. Net loans increased from $164.5 million at December 31, 2010 to $181.3 million at December 31, 2011, fostered by: (i) the gradually improving economy; (ii) the Bank's success in attracting clients from competing financial institutions; and (iii) the Bank's expanding both its array of loan products and its primary geographic lending market. Total deposits rose from $176.0 million at December 31, 2010 to $210.4 million at December 31, 2011, with increases in all transaction account deposit product categories. Total assets increased from $228.9 million at December 31, 2010 to $259.2 million at December 31, 2011, supported by the inflow of deposits.
At December 31, 2011, the Bank's: (i) Tier One Leverage regulatory capital ratio was 16.66%; (ii) Tier One Risk-Based regulatory capital ratio was 21.85%; and (iii) Total Risk-Based regulatory capital ratio was 23.11%. All of these ratios were significantly in excess of the levels required to be categorized in the highest regulatory capital classification of "well capitalized." The Bank's capital ratio profile continues to be one of the strongest for banks headquartered in San Luis Obispo and Santa Barbara counties.
Financial Condition Analysis
Cash and cash equivalents increased from $2.4 million at December 31, 2010 to $5.1 million at December 31, 2011. This increase was caused in part by: (i) deposit inflows towards the end of the fourth quarter that were not yet reinvested into loans or securities; (ii) the Bank's opening additional correspondent bank accounts in conjunction with an expansion of its correspondent network; and (iii) the Bank's placing $1.0 million on deposit into a correspondent bank money market account that offered relatively attractive yields.
Total securities available for sale increased from $52.6 million at December 31, 2010 to $64.9 million at December 31, 2011. During the first three quarters of 2011, the Bank invested excess liquidity arising from strong deposit inflows into AA+ rated hybrid Agency mortgage backed securities and Agency floating rate collateralized mortgage obligations in order to augment yield while awaiting investment of the funds into loans. The mortgage backed securities purchased are fixed rate for an initial period and then become floating rate at a margin over the 1 year LIBOR index, subject to lifetime and periodic caps. The collateralized mortgage obligations float at a margin over 1 month LIBOR, subject to lifetime caps. During the fourth quarter of 2011, the Bank conducted its initial purchases of securities that are obligations of states and political subdivisions. These purchases were made in light of the Bank's having utilized its federal net operating loss carry-forward and therefore being positioned to more substantially benefit from the federal tax advantages of qualifying municipal securities. The fair value of the Bank's $64.9 million in securities at December 31, 2011 exceeded its amortized cost basis by $660 thousand.
The Bank concluded the fourth quarter of 2011 with a very strong liquidity profile, consisting of a significant volume of on-balance sheet liquid assets (including cash & cash equivalents and securities available for sale) and over $130 million in off-balance sheet borrowing capacity.
Net loans increased from $164.5 million at December 31, 2010 to $181.3 million at December 31, 2011. Factors impacting loan portfolio growth during 2011 included:
- The Bank's originating loans to several clients who took advantage of market opportunities to acquire residential rental properties at historically attractive terms, resulting in strong levels of debt service coverage. This accounted for the $4.0 million increase in residential 1 to 4 unit real estate loans outstanding during 2011. The Bank has not yet pursued closed end, owner occupied residential mortgages as a line of business.
- The Bank's continuing to seek additional multifamily lending in light of that real estate sector's relatively strong performance in recent periods and in conjunction with the Bank's credit diversification objectives. Multifamily loans outstanding rose by $4.0 million during 2011. The Bank is presently actively marketing for additional multifamily lending opportunities in San Luis Obispo and Santa Barbara counties.
- Ongoing origination of commercial real estate loans, with the Bank's continuing to focus upon relationship borrowers in the Bank's primary market area. Commercial real estate loans outstanding increased by $9.9 million during 2011. $18.7 million of the Bank's $90.8 million in commercial real estate loans outstanding at December 31, 2011 were for owner occupied properties.
- While construction loans increased by a net $0.8 million during 2011, the associated portfolio experienced turnover as various projects were completed and obtained permanent financing. All of the Bank's construction loans at December 31, 2011 were for projects in the Central Coast region of California.
- The Bank's funding a $1.3 million commercial term loan in support of its Community Reinvestment Act Program. This loan facilitates enhanced safety and security for the residents of a senior care facility located in the Bank's primary market area.
- Commercial business loans declined by $0.5 million during the fourth quarter of 2011 primarily due to seasonal pay-downs by certain borrowers.
- Loan portfolio growth during 2011 was restrained by the Bank's selling a total of $8.1 million in loans for credit concentration management reasons (e.g. commercial real estate loans), in order to continue serving clients near the Bank's legal lending limit, and to take advantage of attractive secondary market pricing for the guaranteed portion of U.S. Small Business Administration ("SBA") program loans.
At December 31, 2011, the Bank had $5.2 million in outstanding loan balances that were guaranteed under various programs administered by the SBA, the U.S. Department of Agriculture, or other similar guarantors. The Bank currently has a number of loans in the pipeline under these programs, which help to provide earlier stage and / or longer term financing to various profiles of businesses than might otherwise be available.
Commenting on the Bank's recent lending activity, Mark A. Crawford, the Bank's President, Chief Executive Officer, and Chief Credit Officer, stated: "The $17.6 million increase in gross loans outstanding during 2011 was achieved while maintaining high credit quality and despite the loans sold into the secondary market. The Bank has ample funds available for lending to qualified borrowers and offers a broad array of loan products, including our back to back interest rate swap products and various types of loans under multiple guaranty programs." Mr. Crawford then continued: "Looking forward to 2012, we would like to increase the percentage of average total assets comprised of loans, in part by reinvesting periodic cash flows from the security portfolio into an expansion of the loan portfolio. At the same time, we plan to continue our focus on quality credit structures, conservative loan to value ratios, and more than adequate global cash flows in extending loans in the current less than robust economic environment."
The Bank's allowance for loan losses increased from $2.4 million at December 31, 2010 to $3.3 million at December 31, 2011. The ratio of allowance for loan losses to loans outstanding rose from 1.46% at December 31, 2010 to 1.78% at December 31, 2011. At both December 31, 2010 and December 31, 2011, the Bank did not have any: (i) loans which were 30 or more days delinquent; or (ii) loans on non-accrual status. At December 31, 2011, the Bank had six impaired loans with an aggregate principal balance of $1.0 million, four of which were troubled debt restructured loans. All six of these loans were current in their payments as of December 31, 2011. Factors that contributed to the increase in the ratio of allowance for loan losses to loans outstanding during 2011 included:
- the transfer of certain loans from the general Pass category to the Watch List, generally due to the borrowers' experiencing weaker cash flow results during the most recent review period;
- the downgrade of certain other loans to Substandard following the Bank's receiving updated financial information for the borrowers that indicated more significant adverse trends in their businesses;
- the establishment of specific reserves for loans which became impaired during 2011; and
- the Bank's modifying its Loss Given Default rating for certain loans based upon an updated evaluation of the fair value of the collateral pledged, including in light of still softening real estate values for segments of properties within the Bank's primary and secondary market areas.
The Bank's investment in the capital stock of the Federal Home Loan Bank ("FHLB") increased from $1.1 million at December 31, 2010 to $1.2 million at December 31, 2011 due to the standard asset-based investment requirement applicable to FHLB members.
Premises and equipment, net, decreased from $1.7 million at December 31, 2010 to $1.2 million at December 31, 2011, as the effect of periodic depreciation and amortization was larger than the impact of a relatively small volume of new fixed asset purchases.
Other real estate owned decreased from $4.5 million at December 31, 2010 to $2.0 million at December 31, 2011. The Bank did not foreclose upon any real estate during 2011. During the first quarter of 2011, the Bank sold two of the three foreclosed properties owned at December 31, 2010, in aggregate generating no gain or loss on sale. During 2011, the Bank recognized a $552 thousand post-acquisition valuation allowance on the single remaining piece of foreclosed real estate owned due to a decline in fair value. This property is located in the Bank's primary market area.
Other assets increased from $1.7 million at December 31, 2010 to $2.7 million at December 31, 2011 primarily due to the removal of the valuation allowance against the Bank's $1.4 million in net deferred tax assets as of December 31, 2011.
Non-interest bearing checking account balances increased from $23.1 million at December 31, 2010 to a record $35.8 million at December 31, 2011. Non-interest bearing checking account balances during 2011 benefited from the Bank's opening a significant number of new accounts for local businesses and professionals. These clients were often attracted to the extensive customization and flexible delivery channels offered by the Bank, including mobile banking via smartphone. Interest bearing checking accounts increased from $1.9 million at December 31, 2010 to $2.6 million at December 31, 2011. The Bank introduced specialized interest bearing checking accounts for sole proprietors and non-profit organizations during the third quarter of 2011.
Money market deposits increased from $95.0 million at December 31, 2010 to $117.8 million at December 31, 2011. Money market deposit balances during 2011 benefited from:
- low (often, near zero) interest rates being paid on brokerage accounts and money market mutual funds, thereby encouraging clients to transfer their funds to higher yielding and FDIC insured accounts;
- the conversion of certain deposits from certificates of deposit to money market accounts given the limited yield differential between the products in the current interest rate environment;
- the Bank's offering tiered pricing on its money market accounts, whereby clients receive a higher interest rate on their entire account balance as each successively higher balance tier level is attained; and
- strong inflows into the Bank's public funds money market product.
Certificates of deposit decreased from $55.2 million at December 31, 2010 to $53.4 million at December 31, 2011 despite inflows of public funds during the year. The decline primarily resulted from:
- transfers from some maturing certificates of deposit into money market accounts;
- the Bank's returning certain wholesale certificates of deposit upon maturity in light of its strong liquidity position and the limited or negative spreads that were available for investing the funds in cash equivalents or short duration securities; and
- the Bank's moderating its certificate of deposit pricing in response to its favorable liquidity position and the availability of alternative low cost funding.
Commenting on the Bank's deposit performance, Thomas R. Strait, the Bank's Chief Banking Officer, stated: "We are very pleased with the $34.4 million rise in total deposits during 2011. This was accomplished while the Bank reduced its average cost of total deposits from 1.03% at December 31, 2010 to 0.74% at December 31, 2011." Mr. Strait then added: "We are particularly pleased with the Bank's change in deposit mix during 2011. Non-interest bearing checking account balances as a percentage of total deposits increased from 13.1% at December 31, 2010 to 17.0% at December 31, 2011. During the same time period, aggregate transaction accounts rose from 68.6% to 74.6% of total deposits."
Mark R. Andino, the Bank's Chief Financial Officer and Chief Operating Officer, then commented: "The Bank exercised its right to early call (at par) $10.1 million in brokered CDs on January 19, 2012 that presented a weighted average effective interest rate of 2.19%. Because these were longer term CDs which were issued in an earlier, higher interest rate environment, the Bank has the opportunity to enhance net interest income during 2012 by replacing this funding with excess liquidity and / or with new, lower cost deposits. While the early call will slightly reduce net interest income during the first quarter of 2012 due to the accelerated amortization of the remaining original issue discount, the financial impact for all of 2012 is projected to be quite positive."
Borrowings decreased from $12.0 million at December 31, 2010 to $5.0 million at December 31, 2011. The reduction was primarily due to the Bank's using deposit inflows during 2011 to repay short term advances from the FHLB and one longer term borrowing (without prepayment penalty) that were outstanding at the end of 2010. The $5.0 million in borrowings outstanding at December 31, 2011 is comprised of a single long term FHLB advance (2015 maturity) that was obtained to match fund intermediate term fixed rate loans.
Stockholders' equity rose from $39.9 million at December 31, 2010 to $43.2 million at December 31, 2011. The increase was due to:
- the 2011 net income of $2.8 million;
- $424 thousand in capital generated through the Bank's Restricted Share Plan; and
- a $66 thousand increase in accumulated other comprehensive income associated with the unrealized gain on securities available for sale.
Nominal and tangible book values were $9.88 per share at December 31, 2011 versus $9.20 per share at December 31, 2010. Shares of common stock outstanding rose by 31,594 during 2011 in conjunction with the vesting of awards under the Restricted Share Plan. The Bank grants restricted share awards to directors and employees as a means of aligning their interests with the generation of shareholder value.
Operating Results Analysis
Net interest income before the provision for loan losses increased from $2.44 million during the third quarter of 2011 (the immediately preceding quarter) to $2.57 million during the fourth quarter of 2011. This increase was generated by both a rise in average interest earning assets and an increase in the ratio of net interest income to average interest earning assets from 3.99% during the third quarter of 2011 to 4.14% during the fourth quarter of 2011. Factors contributing to this margin expansion included:
- higher loan yields (in part due to a prepayment penalty on a commercial real estate loan);
- a lower weighted average cost of interest bearing deposits, which declined from 1.00% during the third quarter of 2011 to 0.91% during the fourth quarter of 2011;
- a reduced average balance of relatively lower yielding cash equivalents (primarily excess balances maintained at the Federal Reserve Bank); and
- the Bank's initial purchase of comparatively higher yielding (compared to Agency mortgage securities) municipal bonds.
Net interest income before the provision for loan losses of $2.57 million during the fourth quarter of 2011 also compared favorably to net interest income before the provision for loan losses of $2.06 million during the fourth quarter of 2010. The ratio of annualized net interest income to average total assets expanded significantly from 3.67% during the fourth quarter of 2010 to 3.99% during the fourth quarter of 2011.
Net interest income before the provision for loan losses increased from $7.5 million during 2010 to $9.5 million during 2011. This rise was facilitated by both a larger average balance of interest earning assets and an enhanced net interest margin.
The provision for loan losses was $259 thousand during the fourth quarter of 2011, compared to $277 thousand during the fourth quarter of 2010 and $365 thousand during the third quarter of 2011 (the immediately preceding quarter). The provision for loan losses for 2011 totaled $848 thousand, compared to $1.26 million for 2010. The Bank recorded $1.3 million in net charge-offs during 2010 (primarily associated with loans from the Bank's initial period of operation), versus no net charge-offs during 2011. The loan loss provision during the fourth quarter of 2011 primarily arose from: (i) increased reserve requirements stemming from the growth in the loan portfolio; and (ii) greater reserve requirements for certain loans that were downgraded to Substandard.
The Bank realized a gain of $66 thousand during the third quarter of 2011 on the sale of one Agency mortgage backed security. This was the only security sold during 2011. During 2010, the Bank realized gains on sale of securities totaling $570 thousand, which included $153 thousand during the fourth quarter.
The Bank did not sell any loans during the fourth quarters of 2011 and 2010. Gain on sale of loans for 2011 was $73 thousand, a majority of which was associated with the sale of the guaranteed portion of an SBA loan during the third quarter of 2011. The Bank conducted more limited loan sales during 2010, generating an aggregate gain on sale of $2 thousand. The Bank plans to increase its secondary marketing of loans during 2012 as a means of generating income and managing credit concentrations and interest rate risk.
Other non-interest income increased from $27 thousand and $105 thousand during the three and twelve months ended December 31, 2010, respectively, to $39 thousand and $127 thousand during the three and twelve months ended December 31, 2011, respectively. The Bank implemented a revised fee and service charge schedule on August 1, 2011, which benefited third and fourth quarter revenue. In addition, growth in the number of clients and accounts between the 2010 and the 2011 periods supported increased fee income.
The operation of other real estate owned generated $9 thousand in net income during the fourth quarter of 2011, compared to $28 thousand in net expense during the fourth quarter of 2010. The results for the fourth quarter of 2011 benefited from the Bank's receipt of harvest income and refunds of property taxes. The operation of other real estate owned produced net expense of $7 thousand during 2011, versus $8 thousand in net income during 2010. The following table highlights the Bank's basis in various foreclosed properties at the end of each quarter:
$ In Thousands |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Description |
3/31/10 |
6/30/10 |
9/30/10 |
12/31/10 |
3/31/11 |
6/30/11 |
9/30/11 |
12/31/11 |
|
|
|
|
|
|
|
|
|
Motel |
$ 3,072 |
$ -- |
$ -- |
$ -- |
$ -- |
$ -- |
$ -- |
$ -- |
Residential Lot |
-- |
-- |
132 |
116 |
-- |
-- |
-- |
-- |
Mixed Use Income Property |
-- |
2,300 |
2,090 |
1,797 |
-- |
-- |
-- |
-- |
House With Farmland |
-- |
-- |
2,565 |
2,565 |
2,565 |
2,411 |
2,013 |
2,013 |
|
|
|
|
|
|
|
|
|
Total Foreclosed Real Estate |
$ 3,072 |
$ 2,300 |
$ 4,787 |
$ 4,478 |
$ 2,565 |
$ 2,411 |
$ 2,013 |
$ 2,013 |
|
|
|
|
|
|
|
|
|
During most of the first half of 2010, the Bank operated, through a management company, a foreclosed motel which was sold in June 2010 at a loss of $105 thousand. During the second quarter of 2011, the Bank received a $39 thousand payment associated with a claim pursued in conjunction with the operation of the motel during the period of the Bank's ownership. During the third and fourth quarters of 2010, the Bank owned three foreclosed properties, two of which were rented to tenants and two of which were subsequently sold during the first quarter of 2011. The single foreclosed property owned by the Bank at December 31, 2011 is projected to generate a small operating loss until it is sold, as rental income from the home and crop income from the farmland is forecasted to be insufficient to offset insurance, property taxes, and other related costs.
Post-acquisition valuation adjustments for foreclosed property totaled none and $552 thousand during the three and twelve months ended December 31, 2011, respectively. These expenses were associated with the declining value (due to market conditions) of the house with approximately 237 acres of farmland owned by the Bank. This property is currently the subject of a legal action to clarify title and litigation by the Bank against the title insurance company that processed the escrow and issued the title policy for the subject loan.
Post-acquisition valuation adjustments for foreclosed property totaled $310 thousand and $598 thousand during the three and twelve months ended December 31, 2010, respectively. $78 thousand was recognized in the first quarter of 2010 associated with the foreclosed motel, $210 thousand was recorded in the third quarter of 2010 in conjunction with the mixed use property, and a total of $310 thousand was recognized during the fourth quarter in conjunction with the two properties sold during the first quarter of 2011.
Non-interest expense (excluding other real estate owned expense) increased from $1.5 million and $5.8 million during the three and twelve months ended December 31, 2010, respectively, to $1.6 million and $6.2 million during the three and twelve months ended December 31, 2011, respectively. Most of the increased costs in 2011 arose from the operation and promotion of the Santa Maria Branch (which opened in July 2010) and the Paso Robles loan production office (which opened in March 2011).
Compensation and employee benefits expenses increased from $735 thousand during the fourth quarter of 2010 to $824 thousand during the fourth quarter of 2011 primarily due to the costs associated with the staffing of the Paso Robles loan production office and the 2011 Incentive Compensation Plan. The Bank did not maintain an incentive compensation plan in 2010.
Compensation and employee benefits expenses increased from $2.9 million for 2010 to $3.2 million for 2011. This increase reflected:
- incentive compensation expenses of $145 thousand in 2011 versus none in 2010;
- employee base salary increases effective January 1, 2011 and interim base salary adjustments during 2011 primarily in conjunction with internal promotions;
- two employees being hired for the Paso Robles loan production office in 2011;
- the hire of other new positions during 2011 in conjunction with the Bank's continuing growth;
- higher medical insurance benefit costs, despite multiple steps implemented by the Bank to moderate the rate of increase in these expenses; and
- greater employer payroll taxes on the expanded salary base.
Lower expenses for employee restricted share awards and an increase in capitalized direct loan origination costs during 2011 partially offset the above factors.
Accounting, legal, and consulting expenses decreased from $132 thousand and $651 thousand during the three and twelve months ended December 31, 2010, respectively, to $128 thousand and $558 thousand during the three and twelve months ended December 31, 2011, respectively. This decline in full year costs primarily resulted from: (i) lower legal collection expenses; and (ii) the Bank's shifting from external (consulting) to internal human resources functions in 2011. These factors were partially offset by greater internal audit costs in 2011 and by higher consulting expenses in 2011 in support of business generation, including for the Paso Robles loan production office.
Occupancy expense increased from $171 thousand and $645 thousand during the three and twelve months ended December 31, 2010, respectively, to $183 thousand and $716 thousand for the three and twelve months ended December 31, 2011, respectively. These increases were primarily due to higher costs in 2011 for the Santa Maria branch and the Paso Robles loan production office.
Regulatory assessments decreased from $84 thousand and $321 thousand during the three and twelve months ended December 31, 2010, respectively, to $62 thousand and $271 thousand during the three and twelve months ended December 31, 2011, respectively, despite the growth of the Bank. These declines arose from the Bank's benefiting from the new FDIC insurance assessment formula that became effective on April 1, 2011. The new formula is based upon average consolidated assets less average tangible equity, while the prior formula was based upon deposits. The combination of the Bank's strong capitalization and the new, nominally lower assessment rates (applied against a larger assessment base across the financial services industry) resulted in the reduction in the Bank's FDIC insurance expense.
Director expenses increased from $1 thousand and $40 thousand during the three and twelve months ended December 31, 2010, respectively, to $55 thousand and $165 thousand for the three and twelve months ended December 31, 2011, respectively. The final expense recognition for the initial award of restricted shares granted to outside directors occurred during the first quarter of 2010. The outside directors then received no restricted share awards or any other type of compensation until the Board of Directors approved the issuance of a total of 32,000 restricted share awards to the independent directors in March 2011. These awards will vest in March 2012, as long as the directors are then continuing to serve the Bank. The March 2011 awards were only the second grant of restricted shares to the outside directors since the organization of the Bank. The Bank's outside directors have never received cash director fees or any other type of compensation other than restricted shares.
Advertising and promotion expense decreased from $45 thousand and $236 thousand during the three and twelve months ended December 31, 2010 to $32 thousand and $214 thousand during the three and twelve months ended December 31, 2011. The Bank incurred a historically high level of advertising and promotion expense during the third quarter of 2010 in conjunction with its name change and the opening of the Santa Maria branch.
Commenting on the Bank's financial and operating results for 2011, Thomas J. Madden, the Bank's Chairman of the Board, stated: "We are very pleased to again announce record levels of loans, deposits, and total assets. The Bank concluded 2011 with strong liquidity and an excellent capital position. In addition, the Bank continued to maintain a favorable credit profile throughout 2011, with no non-accrual loans at any time during the year." Mr. Madden then continued: "The Board of Directors shares the sentiment recently expressed by a number of shareholders that the price of the Bank's common stock has not reflected our many successes to date. The Board continues to be keenly focused upon the generation of shareholder value. "
Michael D. Bouquet, the Bank's Vice Chairman of the Board, added: "The Board of Directors was very pleased to welcome Matthew P. Quaglino as a new, outside director on January 17, 2012. Mr. Quaglino was one of the original organizers of the Bank in 2007. Since then, he has continued to be actively involved with the Bank as a client, member of the Shareholders Advisory Circle, and participant in the Bank's local advertising and promotion. Mr. Quaglino has held shares in the Bank since the Initial Public Offering and firmly believes in both creating shareholder value and providing a concierge level of service to the Bank's clients."
Paul S. Viborg, a director of the Bank and owner of Viborg Sand and Gravel, headquartered in north San Luis Obispo County, stated: "We continue to search for a quality location in Paso Robles so that the Bank can convert the current loan production office into a full service branch. The Bank has a significant shareholder presence in that market. In addition, loan origination from the Paso Robles loan production office accelerated during the fourth quarter of 2011, as the Bank continues to become better known throughout the region. The Bank is currently providing depository services in north San Luis Obispo County through online deposit, courier, and remote branch deposit for qualifying businesses."
Clinton R. Pearce, a director of the Bank and the Chairman of the Directors Loan Committee, commented: "We look forward to increasing the Bank's lending volume in 2012 as the national and state economies recover. In particular, the Bank is well positioned to augment its commercial business lending as a result of our consultative Relationship Managers and extensive inventory of financial solutions, including sophisticated and customizable cash management products. The Bank is also pursuing additional SBA lending in 2012 under both the 7(a) and 504 Programs."
The Bank's target markets are commercial enterprises, professionals, real estate investors, family business entities, and residents in San Luis Obispo County and northern Santa Barbara County. The San Luis Obispo branch office is located at 4051 Broad Street, Suite 140, San Luis Obispo, California, near the intersection of Broad Street (Highway 227) and Tank Farm Road. The Santa Maria branch office is located at 2646 Santa Maria Way, Suite 101, Santa Maria, California, near the intersection of Santa Maria Way and Broadway. The Paso Robles loan production office is located at 720 10th Street in downtown Paso Robles. The Bank's deposits are insured by the FDIC up to applicable legal limits.
Certain of the statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intend," "estimate," "target," "plans," "may increase," "may fluctuate," "may result in," "are projected," and similar expressions. The Bank's actual results may differ materially from those included in the forward-looking statements. These forward-looking statements involve risks and uncertainties including, but not limited to, the economic, business, and real estate market conditions in the Bank's market areas, the interest rate environment, competition, regulatory and legislative actions, the possibility that the Bank will not be successful in achieving its strategic objectives, the performance and contributions of employees and directors, and other factors. The Bank does not undertake, and specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
This news release is available at the www.AmericanPerspectiveBank.com Internet site for no charge.
General communication:
[email protected]
www.AmericanPerspectiveBank.com
Phone: (805) 547 - 2800 (San Luis Obispo Branch)
Facsimile: (805) 547 - 2801 (San Luis Obispo Branch)
Phone: (805) 354 - 7800 (Santa Maria Branch)
Facsimile: (805) 354 - 7801 (Santa Maria Branch)
Phone: (805) 226 - 5300 (Paso Robles Loan Production Office)
Facsimile: (805) 226 - 5301 (Paso Robles Loan Production Office)
--- financial data follows ---
AMERICAN PERSPECTIVE BANK
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Unaudited |
|
Unaudited |
|
Audited |
|
|
December 31, |
|
September 30, |
|
December 31, |
Consolidated Financial Condition Data |
|
2011 |
|
2011 |
|
2010 |
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
Cash and due from banks |
|
$ 3,138 |
|
$ 2,399 |
|
$ 2,001 |
Interest bearing deposits in other financial institutions |
|
1,964 |
|
2,964 |
|
382 |
Securities available for sale, at fair value: |
|
|
|
|
|
|
Obligations of states and political subdivisions |
|
2,683 |
|
-- |
|
-- |
Fixed rate collateralized mortgage obligations |
|
-- |
|
-- |
|
634 |
Variable rate collateralized mortgage obligations |
|
39,770 |
|
42,326 |
|
34,413 |
Variable rate mortgage backed securities |
|
22,479 |
|
23,578 |
|
17,524 |
|
|
|
|
|
|
|
Total securities available for sale |
|
64,932 |
|
65,904 |
|
52,571 |
|
|
|
|
|
|
|
Loans receivable held for investment: |
|
|
|
|
|
|
Residential 1 to 4 units |
|
3,967 |
|
3,287 |
|
-- |
Home equity lines of credit |
|
13,955 |
|
14,492 |
|
13,973 |
Multifamily real estate loans |
|
15,068 |
|
15,031 |
|
11,067 |
Commercial real estate loans |
|
90,817 |
|
87,579 |
|
80,941 |
Construction loans |
|
12,483 |
|
10,775 |
|
11,640 |
Land / lot loans |
|
6,181 |
|
6,217 |
|
5,420 |
Commercial business loans |
|
37,330 |
|
37,850 |
|
36,452 |
Other loans |
|
4,772 |
|
4,725 |
|
7,431 |
|
|
|
|
|
|
|
Gross loans held for investment, net of deferred fees and costs |
|
184,573 |
|
179,956 |
|
166,924 |
|
|
|
|
|
|
|
Less: |
|
|
|
|
|
|
Allowance for loan losses |
|
(3,292) |
|
(3,033) |
|
(2,444) |
|
|
|
|
|
|
|
Loans receivable held for investment, net |
|
181,281 |
|
176,923 |
|
164,480 |
|
|
|
|
|
|
|
Investment in capital stock of the Federal Home Loan Bank, at cost |
|
1,203 |
|
1,203 |
|
1,076 |
Premises and equipment, net |
|
1,208 |
|
1,332 |
|
1,655 |
Accrued interest receivable |
|
688 |
|
652 |
|
574 |
Other real estate owned |
|
2,013 |
|
2,013 |
|
4,478 |
Other assets |
|
2,736 |
|
1,882 |
|
1,667 |
|
|
|
|
|
|
|
Total assets |
|
$ 259,163 |
|
$ 255,272 |
|
$ 228,884 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
Non-interest bearing checking accounts |
|
$ 35,773 |
|
$ 33,591 |
|
$ 23,136 |
Interest bearing checking accounts |
|
2,561 |
|
2,403 |
|
1,871 |
Savings accounts |
|
906 |
|
735 |
|
733 |
Money market accounts |
|
117,772 |
|
113,724 |
|
95,036 |
Certificates of deposit |
|
53,368 |
|
57,389 |
|
55,221 |
|
|
|
|
|
|
|
Total deposits |
|
210,380 |
|
207,842 |
|
175,997 |
Borrowings |
|
5,000 |
|
5,000 |
|
12,026 |
Other liabilities |
|
579 |
|
863 |
|
950 |
|
|
|
|
|
|
|
Total liabilities |
|
215,959 |
|
213,705 |
|
188,973 |
|
|
|
|
|
|
|
Stockholders' equity |
|
43,204 |
|
41,567 |
|
39,911 |
|
|
|
|
|
|
|
Total liabilities and stockholders' equity |
|
$ 259,163 |
|
$ 255,272 |
|
$ 228,884 |
|
|
|
|
|
|
|
AMERICAN PERSPECTIVE BANK (Dollars In Thousands, Except Per Share Amounts)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Unaudited |
|
Unaudited |
|
Audited |
|
|
Three |
|
Three |
|
Twelve |
|
Twelve |
|
|
Months |
|
Months |
|
Months |
|
Months |
|
|
Ended |
|
Ended |
|
Ended |
|
Ended |
Consolidated Operating Results Data (1) |
|
12/31/2011 |
|
12/31/2010 |
|
12/31/2011 |
|
12/31/2010 |
|
|
|
|
|
|
|
|
|
Interest and dividend income |
|
$ 3,005 |
|
$ 2,575 |
|
$ 11,389 |
|
$ 9,686 |
Interest expense |
|
433 |
|
518 |
|
1,902 |
|
2,151 |
|
|
|
|
|
|
|
|
|
Net interest income before provision for loan losses |
|
2,572 |
|
2,057 |
|
9,487 |
|
7,535 |
Provision for loan losses |
|
259 |
|
277 |
|
848 |
|
1,258 |
|
|
|
|
|
|
|
|
|
Net interest income after provision for loan losses |
|
2,313 |
|
1,780 |
|
8,639 |
|
6,277 |
|
|
|
|
|
|
|
|
|
Non-interest income: |
|
|
|
|
|
|
|
|
Gain on sale of securities |
|
-- |
|
153 |
|
66 |
|
570 |
Gain on sale of loans |
|
-- |
|
-- |
|
73 |
|
2 |
Name change payments in excess of costs |
|
-- |
|
-- |
|
-- |
|
40 |
Other non-interest income |
|
39 |
|
27 |
|
127 |
|
105 |
|
|
|
|
|
|
|
|
|
Total non-interest income |
|
39 |
|
180 |
|
266 |
|
717 |
|
|
|
|
|
|
|
|
|
Other real estate owned expense: |
|
|
|
|
|
|
|
|
Loss on sale of other real estate owned |
|
-- |
|
-- |
|
-- |
|
105 |
Other real estate owned valuation adjustments |
|
-- |
|
310 |
|
552 |
|
598 |
Other real estate owned operations (income) expense, net |
|
(9) |
|
28 |
|
7 |
|
(8) |
|
|
|
|
|
|
|
|
|
Total other real estate owned (income) expense |
|
(9) |
|
338 |
|
559 |
|
695 |
|
|
|
|
|
|
|
|
|
Non-interest expense: |
|
|
|
|
|
|
|
|
Compensation and employee benefits |
|
824 |
|
735 |
|
3,202 |
|
2,874 |
Accounting, legal, and consulting |
|
128 |
|
132 |
|
558 |
|
651 |
Occupancy |
|
183 |
|
171 |
|
716 |
|
645 |
Regulatory assessments |
|
62 |
|
84 |
|
271 |
|
321 |
Equipment |
|
51 |
|
57 |
|
207 |
|
219 |
Data and item processing |
|
61 |
|
64 |
|
240 |
|
225 |
Director expenses |
|
55 |
|
1 |
|
165 |
|
40 |
Supplies, printing, courier, and postage |
|
26 |
|
28 |
|
110 |
|
118 |
Advertising and promotion |
|
32 |
|
45 |
|
214 |
|
236 |
Provision for (reduction of) allowance for off balance |
|
|
|
|
|
|
|
|
sheet commitments |
|
9 |
|
9 |
|
1 |
|
(1) |
Other expenses |
|
126 |
|
131 |
|
533 |
|
491 |
|
|
|
|
|
|
|
|
|
Total non-interest expense |
|
1,557 |
|
1,457 |
|
6,217 |
|
5,819 |
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
804 |
|
165 |
|
2,129 |
|
480 |
(Benefit from) provision for income taxes |
|
(676) |
|
-- |
|
(674) |
|
2 |
|
|
|
|
|
|
|
|
|
Net income |
|
$ 1,480 |
|
$ 165 |
|
$ 2,803 |
|
$ 478 |
|
|
|
|
|
|
|
|
|
Weighted average shares used in basic income |
|
|
|
|
|
|
|
|
per share calculation |
|
4,361,309 |
|
4,331,687 |
|
4,349,376 |
|
4,304,839 |
|
|
|
|
|
|
|
|
|
Basic income per share |
|
$ 0.34 |
|
$ 0.04 |
|
$ 0.64 |
|
$ 0.11 |
|
|
|
|
|
|
|
|
|
Weighted average shares used in diluted income |
|
|
|
|
|
|
|
|
per share calculation |
|
4,398,155 |
|
4,341,316 |
|
4,376,678 |
|
4,327,447 |
|
|
|
|
|
|
|
|
|
Diluted income per share |
|
$ 0.34 |
|
$ 0.04 |
|
$ 0.64 |
|
$ 0.11 |
|
|
|
|
|
|
|
|
|
(1) Certain reclassifications have been made to prior period financial statements to conform them to the current period presentation.
|
AMERICAN PERSPECTIVE BANK
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Three |
|
Three |
|
Twelve |
|
Twelve |
|
|
Months |
|
Months |
|
Months |
|
Months |
|
|
Ended |
|
Ended |
|
Ended |
|
Ended |
Other Information |
|
12/31/2011 |
|
12/31/2010 |
|
12/31/2011 |
|
12/31/2010 |
|
|
|
|
|
|
|
|
|
Average total assets |
|
$ 257,563 |
|
$ 223,863 |
|
$ 246,033 |
|
$ 212,415 |
Annualized net interest income / average total assets |
|
3.99% |
|
3.67% |
|
3.86% |
|
3.55% |
|
|
|
|
|
|
|
|
|
Average interest earning assets |
|
$ 248,189 |
|
$ 211,920 |
|
$ 236,072 |
|
$ 201,759 |
Annualized net interest income / average interest earning |
|
|
|
|
|
|
|
|
assets |
|
4.14% |
|
3.88% |
|
4.02% |
|
3.73% |
|
|
|
|
|
|
|
|
|
Average total deposits |
|
$ 209,107 |
|
$ 173,614 |
|
$ 197,099 |
|
$ 164,917 |
Average stockholders' equity |
|
$ 42,142 |
|
$ 40,092 |
|
$ 41,217 |
|
$ 39,836 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Information |
|
December 31, 2011 |
|
September 30, 2011 |
|
December 31, 2010 |
|
|
|
|
|
|
|
|
|
Net loans / deposits |
|
86.17% |
|
85.12% |
|
93.46% |
|
Allowance for loan losses / loans outstanding |
|
1.78% |
|
1.69% |
|
1.46% |
|
Nominal and tangible book value per share |
|
$ 9.88 |
|
$ 9.56 |
|
$ 9.20 |
|
Shares of common stock outstanding (1) |
|
4,370,880 |
|
4,349,021 |
|
4,339,286 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Excludes non-vested restricted share awards. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE American Perspective Bank
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