Attached files
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| 8-K - FIDELITY D & D BANCORP INC | v220013_8k.htm |
Exhibit 99.1
FIDELITY D & D BANCORP, INC.
FOR IMMEDIATE RELEASE
Date: April 27, 2011
Contacts:
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Daniel J. Santaniello
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Salvatore R. DeFrancesco, Jr.
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President and
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Treasurer and
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Chief Executive Officer
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Chief Financial Officer
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570-504-8035
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570-504-8000
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FIDELITY D & D BANCORP, INC.
REPORTS FIRST QUARTER 2011 FINANCIAL RESULTS
Dunmore, PA – Fidelity D & D Bancorp, Inc., (OTC Bulletin Board: FDBC), parent company of The Fidelity Deposit and Discount Bank, announced net income for the quarter ended March 31, 2011 of $1,227,000, an increase of $671,000, or 121%, compared to $556,000 for the first quarter of 2010. Improvement in financial performance was seen from the combined management efforts across all divisions of the Bank: net interest income and other income increased $75,000 and $188,000, respectively; while, $100,000 less provision for loan loss was required and other operating expenses declined $615,000. Earnings per share on a fully diluted basis for the quarter totaled $0.56 compared to $0.26 for the prior year period.
“Fidelity delivered excellent financial performance across all divisions in the opening quarter of 2011,” stated Daniel J. Santaniello, President and Chief Executive Officer. “With continued focus on building customer relationships and a strong customer acquisition strategy, Fidelity continued to produce strong core deposit growth along with an improved net interest margin. The company continues to be well positioned from a capital perspective, exceeding all regulatory requirements. Management’s continued focus on enhancing asset quality produced improvements in all asset quality metrics.”
Net interest income increased $75,000 to $5,234,000 for the quarter ended March 31, 2011 from $5,159,000 recorded during the first quarter of 2011. The increase in demand deposits and less outstanding debt along with the interest rate environment led to the cost savings on interest-bearing liabilities which more than offset the decline in yield on interest-earning assets, increasing net interest income earned for the first quarter of 2011. This also improved net interest margin to 4.05% for the first quarter of 2011, compared to 3.91% for same 2010 period.
A provision for loan loss of $475,000 was recorded during the first quarter of 2011 compared to $575,000 required for the same 2010 period. The provision for loan loss reinforced the allowance for loan losses for potential credit risks that may result from today’s uncertain economic climate, while improvement in overall asset quality dictated the lower required level of provision for the current quarter. The allowance for loan losses was 1.96% of total loans at March 31, 2011, up from 1.79% at March 31, 2010.
Total other income recorded for the quarter ended March 31, 2011 was $1,413,000, compared to $1,225,000 for the same quarter in 2010. The increase was primarily from added gains from mortgage banking and the sale of an SBA guaranteed commercial loan during 2011. Mortgage servicing plus higher revenue from financial service and trust activities during 2011 contributed to the increased other income when compared to the first quarter of 2010.
The OTTI credit losses on pooled trust preferred securities were $75,000 and $79,000 in the quarters ended March 31, 2011 and 2010, respectively. The risk of future OTTI charges will be influenced by the performance of the collateral pools that support each pooled trust preferred security. Additional rating downgrades, deferring collateral and reduced default recovery rates, could cause further OTTI charges to be recognized through future earnings.
Total other operating expense was reduced by $615,000, or 12% from $5,105,000 to $4,490,000 for the quarters ended March 31, 2010 and 2011, respectively. The other expense decrease resulted primarily from $544,000 less salary and benefit costs incurred, including the $398,000 early retirement and severance costs realized in 2010, and the $113,000 reduction in collection and ORE expenses during the first quarter of 2011 as compared to 2010.
The Company’s assets increased 6% to total $596,296,000 at March 31, 2011 compared to the $561,673,000 total assets at December 31, 2010. The Bank’s regulatory capital ratios improved for the period ending March 31, 2011 with a Total Risk Based Capital Ratio of 12.0%, Tier I Capital Ratio of 10.8% and Leverage Ratio of 8.4%, all of which exceed the current "well capitalized" regulatory requirements.
Fidelity D & D Bancorp, Inc. serves Lackawanna and Luzerne Counties through The Fidelity Deposit and Discount Bank’s 11 community banking offices. The Bank's deposits are insured by the Federal Deposit Insurance Corporation up to the full extent permitted by law.
Forward-Looking Statements
Certain of the matters discussed in this press release may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and as such may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. The words “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” and similar expressions are intended to identify such forward-looking statements.
The Company’s actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation:
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the effects of economic deterioration on current customers, specifically the effect of the economy on loan customers’ ability to repay loans;
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the costs and effects of litigation and of unexpected or adverse outcomes in such litigation;
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the effects of new laws and regulations, specifically the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act;
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governmental monetary and fiscal policies, as well as legislative and regulatory changes;
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the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters;
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the risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities and interest rate protection agreements, as well as interest rate risks;
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the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in the Company’s market area and elsewhere, including institutions operating locally, regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet;
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technological changes;
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acquisitions and integration of acquired businesses;
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the failure of assumptions underlying the establishment of reserves for loan and lease losses and estimations of values of collateral and various financial assets and liabilities;
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volatilities in the securities markets;
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deteriorating economic conditions;
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acts of war or terrorism; and
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disruption of credit and equity markets.
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For more information please visit our investor relations web site located through www.bankatfidelity.com.
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FIDELITY D & D BANCORP, INC.
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Unaudited Condensed Consolidated Balance Sheets
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At Period End:
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March 31, 2011
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December 31, 2010
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Assets
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Total cash and cash equivalents
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$ | 47,443,267 | $ | 22,967,345 | ||||
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Investment securities
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90,881,865 | 83,431,371 | ||||||
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Federal Home Loan Bank Stock
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4,314,900 | 4,542,000 | ||||||
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Loans and leases
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419,806,900 | 416,014,151 | ||||||
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Allowance for loan losses
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(8,223,978 | ) | (7,897,822 | ) | ||||
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Premises and equipment, net
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14,421,943 | 14,763,873 | ||||||
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Life insurance cash surrender value
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9,501,732 | 9,424,926 | ||||||
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Other assets
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18,149,883 | 18,427,308 | ||||||
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Total assets
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$ | 596,296,512 | $ | 561,673,152 | ||||
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Liabilities
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Non-interest-bearing deposits
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$ | 113,283,383 | $ | 85,780,392 | ||||
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Interest-bearing deposits
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399,916,954 | 396,667,300 | ||||||
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Total deposits
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513,200,337 | 482,447,692 | ||||||
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Short-term borrowings
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11,131,104 | 8,548,400 | ||||||
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Long-term debt
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21,000,000 | 21,000,000 | ||||||
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Other liabilities
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2,662,440 | 2,903,045 | ||||||
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Total liabilities
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547,993,881 | 514,899,137 | ||||||
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Shareholders' equity
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48,302,631 | 46,774,015 | ||||||
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Total liabilities and shareholders' equity
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$ | 596,296,512 | $ | 561,673,152 | ||||
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Average Year-To-Date Balances:
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March 31, 2011
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December 31, 2010
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Assets
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Total cash and cash equivalents
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$ | 38,769,905 | $ | 42,181,685 | ||||
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Investment securities
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89,632,732 | 84,050,381 | ||||||
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Loans and leases, net
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411,113,414 | 419,748,250 | ||||||
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Premises and equipment, net
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14,638,667 | 14,975,020 | ||||||
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Other assets
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27,516,317 | 26,598,374 | ||||||
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Total assets
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$ | 581,671,035 | $ | 587,553,710 | ||||
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Liabilities
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Non-interest-bearing deposits
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$ | 101,941,654 | $ | 76,707,139 | ||||
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Interest-bearing deposits
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392,160,656 | 405,518,509 | ||||||
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Total deposits
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494,102,310 | 482,225,648 | ||||||
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Short-term borrowings and long-term debt
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36,534,997 | 53,823,711 | ||||||
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Other liabilities
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3,258,128 | 3,626,830 | ||||||
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Total liabilities
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533,895,435 | 539,676,189 | ||||||
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Shareholders' equity
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47,775,600 | 47,877,521 | ||||||
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Total liabilities and shareholders' equity
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$ | 581,671,035 | $ | 587,553,710 | ||||
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FIDELITY D & D BANCORP, INC.
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Unaudited Condensed Consolidated Statements of Income
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Three Months Ended
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Mar. 31, 2011
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Mar. 31, 2010
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Interest income
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Loans and leases
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$ | 5,934,513 | $ | 6,226,313 | ||||
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Securities and other
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615,860 | 814,978 | ||||||
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Total interest income
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6,550,373 | 7,041,291 | ||||||
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Interest expense
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Deposits
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1,041,877 | 1,414,061 | ||||||
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Borrowings and debt
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274,877 | 468,296 | ||||||
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Total interest expense
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1,316,754 | 1,882,357 | ||||||
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Net interest income
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5,233,619 | 5,158,934 | ||||||
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Provision for loan losses
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475,000 | 575,000 | ||||||
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OTTI - credit losses
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74,692 | 79,050 | ||||||
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Other income
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1,412,630 | 1,224,652 | ||||||
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Other expenses
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4,489,828 | 5,104,449 | ||||||
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Provision for income taxes
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379,844 | 69,207 | ||||||
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Net income
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$ | 1,226,886 | $ | 555,880 | ||||
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Three Months Ended
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Jun. 30, 2010
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Mar. 31, 2010
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Interest income
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Loans and leases
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$ | 5,934,513 | $ | 6,010,455 | $ | 6,213,939 | $ | 6,158,022 | $ | 6,226,313 | ||||||||||
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Securities and other
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615,860 | 604,335 | 739,761 | 812,171 | 814,978 | |||||||||||||||
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Total interest income
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6,550,373 | 6,614,790 | 6,953,700 | 6,970,193 | 7,041,291 | |||||||||||||||
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Interest expense
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Deposits
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1,041,877 | 1,119,838 | 1,244,438 | 1,299,716 | 1,414,061 | |||||||||||||||
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Borrowings and debt
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274,877 | 390,980 | 436,490 | 453,196 | 468,296 | |||||||||||||||
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Total interest expense
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1,316,754 | 1,510,818 | 1,680,928 | 1,752,912 | 1,882,357 | |||||||||||||||
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Net interest income
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5,233,619 | 5,103,972 | 5,272,772 | 5,217,281 | 5,158,934 | |||||||||||||||
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Provision for loan losses
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475,000 | 835,000 | 375,000 | 300,000 | 575,000 | |||||||||||||||
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OTTI - credit losses
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74,692 | 9,332,322 | 1,748,674 | 675,872 | 79,050 | |||||||||||||||
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Other income
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1,412,630 | 695,159 | 1,478,263 | 1,316,231 | 1,224,652 | |||||||||||||||
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Other expenses
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4,489,828 | 796,137 | 4,317,611 | 4,694,155 | 5,104,449 | |||||||||||||||
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Provision (credit) for income taxes
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379,844 | (2,724,896 | ) | (45,193 | ) | 144,513 | 69,207 | |||||||||||||
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Net income (loss)
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$ | 1,226,885 | $ | (2,439,432 | ) | $ | 354,943 | $ | 718,972 | $ | 555,880 | |||||||||
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FIDELITY D & D BANCORP, INC.
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Unaudited Condensed Consolidated Balance Sheets
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At Period End:
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Jun. 30, 2010
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Mar. 31, 2010
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Assets
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Total cash and cash equivalents
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$ | 47,443,267 | $ | 22,967,345 | $ | 47,571,175 | $ | 36,728,875 | $ | 40,182,654 | ||||||||||
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Investment securities
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90,881,865 | 83,431,371 | 87,255,681 | 75,948,064 | 81,433,603 | |||||||||||||||
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Federal Home Loan Bank Stock
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4,314,900 | 4,542,000 | 4,781,100 | 4,781,100 | 4,781,100 | |||||||||||||||
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Loans and leases
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419,806,900 | 416,014,151 | 422,688,600 | 428,122,754 | 434,257,867 | |||||||||||||||
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Allowance for loan losses
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(8,223,978 | ) | (7,897,822 | ) | (7,484,253 | ) | (7,523,250 | ) | (7,751,589 | ) | ||||||||||
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Premises and equipment, net
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14,421,943 | 14,763,873 | 14,649,763 | 14,936,387 | 15,245,122 | |||||||||||||||
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Life insurance cash surrender value
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9,501,732 | 9,424,926 | 9,347,707 | 9,269,973 | 9,192,627 | |||||||||||||||
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Other assets
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18,149,883 | 18,427,308 | 17,788,825 | 17,006,380 | 17,947,191 | |||||||||||||||
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Total assets
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$ | 596,296,512 | $ | 561,673,152 | $ | 596,598,598 | $ | 579,270,283 | $ | 595,288,575 | ||||||||||
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Liabilities
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Non-interest-bearing deposits
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$ | 113,283,383 | $ | 85,780,392 | $ | 81,819,441 | $ | 77,836,050 | $ | 73,065,849 | ||||||||||
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Interest-bearing deposits
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399,916,954 | 396,667,300 | 409,063,486 | 403,090,854 | 413,491,335 | |||||||||||||||
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Total deposits
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513,200,337 | 482,447,692 | 490,882,927 | 480,926,904 | 486,557,184 | |||||||||||||||
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Short-term borrowings
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11,131,104 | 8,548,400 | 21,804,259 | 15,577,694 | 26,370,222 | |||||||||||||||
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Long-term debt
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21,000,000 | 21,000,000 | 32,000,000 | 32,000,000 | 32,000,000 | |||||||||||||||
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Other liabilities
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2,662,440 | 2,903,045 | 3,235,939 | 2,922,545 | 3,995,312 | |||||||||||||||
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Total liabilities
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547,993,881 | 514,899,137 | 547,923,125 | 531,427,143 | 548,922,718 | |||||||||||||||
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Shareholders' equity
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48,302,631 | 46,774,015 | 48,675,473 | 47,843,140 | 46,365,857 | |||||||||||||||
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Total liabilities and shareholders' equity
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$ | 596,296,512 | $ | 561,673,152 | $ | 596,598,598 | $ | 579,270,283 | $ | 595,288,575 | ||||||||||
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Average Quarterly Balances:
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Jun. 30, 2010
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Mar. 31, 2010
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Assets
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Total cash and cash equivalents
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$ | 38,769,905 | $ | 53,297,299 | $ | 44,858,721 | $ | 33,008,130 | $ | 37,358,017 | ||||||||||
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Investment securities
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89,632,732 | 86,120,978 | 83,361,340 | 86,919,361 | 79,737,266 | |||||||||||||||
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Loans and leases, net
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411,113,414 | 409,008,829 | 416,462,967 | 424,331,436 | 429,450,503 | |||||||||||||||
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Premises and equipment, net
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14,638,667 | 14,648,400 | 14,854,405 | 15,116,975 | 15,288,661 | |||||||||||||||
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Other assets
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27,516,317 | 27,381,576 | 26,404,370 | 26,073,072 | 26,527,219 | |||||||||||||||
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Total assets
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$ | 581,671,035 | $ | 590,457,082 | $ | 585,941,803 | $ | 585,448,974 | $ | 588,361,666 | ||||||||||
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Liabilities
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Non-interest-bearing deposits
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$ | 101,941,654 | $ | 82,019,125 | $ | 75,830,989 | $ | 74,100,555 | $ | 74,808,276 | ||||||||||
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Interest-bearing deposits
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392,160,656 | 404,692,893 | 406,630,065 | 407,132,578 | 403,594,213 | |||||||||||||||
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Total deposits
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494,102,310 | 486,712,018 | 482,461,054 | 481,233,133 | 478,402,489 | |||||||||||||||
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Short-term borrowings and long-term debt
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36,534,997 | 51,089,956 | 50,958,606 | 53,323,203 | 60,053,061 | |||||||||||||||
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Other liabilities
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3,258,128 | 3,995,850 | 3,509,030 | 3,618,319 | 3,379,727 | |||||||||||||||
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Total liabilities
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533,895,435 | 541,797,824 | 536,928,690 | 538,174,655 | 541,835,277 | |||||||||||||||
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Shareholders' equity
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47,775,600 | 48,659,258 | 49,013,113 | 47,274,319 | 46,526,389 | |||||||||||||||
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Total liabilities and shareholders' equity
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$ | 581,671,035 | $ | 590,457,082 | $ | 585,941,803 | $ | 585,448,974 | $ | 588,361,666 | ||||||||||
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FIDELITY D & D BANCORP, INC.
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Selected Financial Ratios and Other Data
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Three Months Ended
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Jun. 30, 2010
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Mar. 31, 2010
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Selected returns and financial ratios
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Diluted earnings (loss) per share
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$ | 0.56 | $ | (2.26 | ) | $ | 0.16 | $ | 0.34 | $ | 0.26 | |||||||||
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Dividends per share
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$ | 0.25 | $ | 0.25 | $ | 0.25 | $ | 0.25 | $ | 0.25 | ||||||||||
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Yield on interest-earning assets (FTE)
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5.03 | % | 4.87 | % | 5.14 | % | 5.19 | % | 5.28 | % | ||||||||||
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Cost of interest-bearing liabilities
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1.25 | % | 1.32 | % | 1.46 | % | 1.53 | % | 1.65 | % | ||||||||||
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Net interest spread
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3.78 | % | 3.55 | % | 3.68 | % | 3.66 | % | 3.63 | % | ||||||||||
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Net interest margin
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4.05 | % | 3.79 | % | 3.93 | % | 3.92 | % | 3.91 | % | ||||||||||
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Return on average assets
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0.86 | % | -3.25 | % | 0.24 | % | 0.49 | % | 0.38 | % | ||||||||||
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Return on average equity
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10.41 | % | -39.42 | % | 2.87 | % | 6.10 | % | 4.85 | % | ||||||||||
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Efficiency ratio
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65.51 | % | 58.61 | % | 62.10 | % | 69.66 | % | 71.57 | % | ||||||||||
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Expense ratio
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2.15 | % | 1.68 | % | 1.92 | % | 2.32 | % | 2.40 | % | ||||||||||
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Other data
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Jun. 30, 2010
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Mar. 31, 2010
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Book value per share
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$ | 21.96 | $ | 21.48 | $ | 22.50 | $ | 22.27 | $ | 21.74 | ||||||||||
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Equity to assets
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8.10 | % | 8.33 | % | 8.16 | % | 8.26 | % | 7.79 | % | ||||||||||
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Allowance for loan losses to:
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Total loans
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1.96 | % | 1.90 | % | 1.77 | % | 1.76 | % | 1.79 | % | ||||||||||
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Non-accrual loans
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0.87 | x | 0.79 | x | 0.78 | x | 0.84 | x | 0.70 | x | ||||||||||
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Non-accrual loans to total loans
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2.25 | % | 2.40 | % | 2.27 | % | 2.08 | % | 2.56 | % | ||||||||||
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Non-performing assets to total assets
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2.37 | % | 2.38 | % | 2.22 | % | 2.21 | % | 2.28 | % | ||||||||||