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8-K - 8-K - PACIFIC CONTINENTAL CORP | d660196d8k.htm |
Exhibit 99.1
NEWS RELEASE
FOR MORE INFORMATION CONTACT: | Hal Brown | Mick Reynolds | ||
CEO | Executive Vice President/CFO | |||
541-686-8685 | 541-686-8685 | |||
www.therightbank.com | ||||
Email: banking@therightbank.com |
FOR IMMEDIATE RELEASE
Pacific Continental Corporation Reports Fourth Quarter and Full Year 2013 Results
Loan Growth and Acquisition Produce Record Net Income
EUGENE, Ore., January 22, 2014 Pacific Continental Corporation (Nasdaq: PCBK), the holding company of Pacific Continental Bank, today reported financial results for the fourth quarter and full year 2013.
Recent highlights:
| Record net income of $13.8 million for the year 2013. |
| Organic loan growth continued for the eighth consecutive quarter. |
| Continued improvement in credit quality statistics. |
| Declared first quarter 2014 regular quarterly cash dividend of $0.10 per share and special cash dividend of $0.10 per share. |
| Total risk-based capital ratio of 16.15%, significantly above the 10.00% minimum for well-capitalized designation. |
| Recognized as one of Oregons most admired companies by the Portland Business Journal for the fifth consecutive year. |
Net income
Net income for fourth quarter 2013 was $3.7 million or $0.20 per diluted share compared to net income of $3.4 million or $0.19 per diluted share in fourth quarter 2012. Return on average assets, average book equity, and average tangible equity were 1.00%, 8.06%, and 9.28%, respectively, in fourth quarter 2013, compared to 0.99%, 7.33%, and 8.33% for the same quarter last year.
Net income for the full year 2013 was a record $13.8 million or $0.76 per diluted share compared to net income of $12.7 million or $0.69 per share for the year 2012. Included in 2013 full year results was $1.2 million of one-time merger related expenses related to the Century Bank acquisition, which reduced current year net income by $822 thousand or $0.05 per diluted share.
We are certainly pleased with our 2013 results and the shareholder returns for the year both in terms of share appreciation and dividends, said Hal Brown, chief executive officer. Our strong capital position, liquidity and credit quality, together with the improving economic conditions, support our optimistic outlook as we begin 2014, added Brown.
Loan growth
Outstanding gross loans at December 31, 2013, were $994.8 million, up $16.1 million over the prior quarter end and up $123.5 million from year-end 2012. Excluding the loans acquired in the Century Bank transaction, organic loan growth for 2013 was $80.5 million for an annualized growth rate of 9.24%. Loan growth for the fourth quarter and full year was primarily centered in owner-occupied commercial real estate, construction lending and commercial loans.
At December 31, 2013, loans to dental professionals totaled $307.3 million, representing 30.9% of the total loan portfolio. Outstanding loans to dental professionals grew by $36.5 million or 13.5% over December 31, 2012.
Our sustained loan growth was attributable to an improving economy, our niche focus and a strong team of relationship bankers that successfully retained and added several client relationships during the year, said Roger Busse, president and chief operating officer. Our dental lending program continued to be very successful both in terms of growth and credit quality, added Busse.
Core deposits
Period-end Company-defined core deposits were $990.3 million, an increase of $51.7 million or 5.5% over the prior year end. At period-end December 31, 2013, noninterest-bearing demand deposits totaled $366.9 million and represented 37.0% of core deposits.
Net interest margin
The fourth quarter 2013 net interest margin, on a tax equivalent basis, was 4.39%, representing an increase of 28 basis points over the 4.11% reported for the fourth quarter 2012. Included in the fourth quarter net interest margin was a $220 thousand prepayment penalty from an early payoff of a loan, which contributed 7 basis points to the current quarters margin. In addition, the accretion of the Century Bank loan fair value market adjustment positively impacted the net interest margin by 4 basis points.
The net interest margin for the full year 2013, on a tax equivalent basis, was 4.37%, an increase of 13 basis points over the 4.24% net interest margin reported for 2012. Earning asset yields remained relatively unchanged in 2013 when compared to 2012, primarily due to an increase in yield on the securities portfolio. Most of the improvement in the annual net interest margin was attributable to a lower cost of funds as the cost of interest-bearing liabilities was down 17 basis points in 2013 from 2012.
Classified assets, provisioning and loan statistics
At December 31, 2013, classified assets totaled $52.0 million and represented 29.02% of regulatory capital, compared to $56.1 million and 31.18% of regulatory capital at December 31, 2012. Classified asset levels increased by $5.8 million as a result of the Century Bank acquisition. Fourth quarter 2013 classified assets were lower than pre-acquisition levels.
Nonperforming assets, a subcategory of classified assets, totaled $21.0 million at December 31, 2013, or 1.45% of total assets, a decrease from the December 31, 2012 ratio of 1.92%. Nonperforming assets were comprised of $4.6 million in nonperforming loans, net of government guarantees, and $16.4 million in other real estate owned. Loans past-due 30-89 days were 0.23% of total loans at December 31, 2013, compared to 0.30% at December 31, 2012.
This is the fourth consecutive year of improvement in our credit quality statistics and we are optimistic this trend will continue in 2014, said Casey Hogan, executive vice president and chief credit officer.
The Company made no provision for loan losses during the fourth quarter 2013 and provisioned $250 thousand for the full year 2013. Net loan charge offs for the year 2013 were $678 thousand or 0.07% of average outstanding loans. The allowance for loan losses as a percentage of outstanding loans at December 31, 2013, was 1.60% compared to 1.88% at December 31, 2012. The allowance for loan losses as a percentage of total nonperforming loans, net of government guarantees, improved to 345.42% at December 31, 2013, from 193.29% reported one year ago, reflecting both a reduction in nonperforming loans and an overall general improvement in the quality of the loan portfolio.
Capital levels
The Companys capital ratios continued to be well above the minimum FDIC well-capitalized designated levels. At December 31, 2013, the Companys Tier 1 leverage ratio, Tier 1 risk-based capital ratio, and Total risk-based capital ratios were 11.49%, 14.90% and 16.15%, respectively, as compared to 12.33%, 16.90% and 18.15% at December 31, 2012, reflecting improved capital leverage. The FDICs minimum well-capitalized ratios are 5.00%, 6.00% and 10.00%, respectively.
Noninterest income and expense
Noninterest income for the fourth quarter was $1.6 million, up $181 thousand over fourth quarter 2012. Noninterest expense in fourth quarter 2013 was up $1.1 million over fourth quarter 2012, with a portion of the increase centered in other real estate expense, primarily attributable to valuation write-downs. In addition, employee compensation was up, reflecting the addition of business development personnel who have increased calling efforts during 2013, resulting in part in the Banks loan growth during the period. The fourth quarter 2013 efficiency ratio was 62.97% compared to 64.26% for fourth quarter 2012.
Conference call and audio webcast
Management will conduct a live conference call and audio webcast for interested parties relating to the Companys results for the fourth quarter and full-year 2013 on Thursday, January 23, 2014, at 11:00 a.m. Pacific / 2:00 p.m. Eastern. To listen to the conference call, interested parties should call 866-292-1418. Following the formal remarks, a question and answer session will be open to all interested parties. The webcast will be available via Pacific Continentals website www.therightbank.com. To listen to the live audio webcast, click on the webcast presentation link on the Companys home page a few minutes before the presentation is scheduled to begin. An audio webcast replay is typically available within twenty-four hours following the live webcast and will be archived for one year on the Pacific Continental website. Any questions regarding the conference call presentation or webcast should be directed to Shannon Coffin, executive administrative assistant, at 541-686-8685.
About Pacific Continental Bank
Pacific Continental Bank, the operating subsidiary of Pacific Continental Corporation, delivers highly personalized services through fourteen banking offices in Oregon and Washington. The Bank also operates loan production offices in Tacoma, Washington and Denver, Colorado. Pacific Continental, with $1.4 billion in assets, has established one of the most unique and attractive metropolitan branch networks in the Pacific Northwest with offices in three of the regions largest markets including Seattle, Portland and Eugene. Pacific Continental targets the banking needs of community-based businesses, health care professionals, professional service providers and nonprofit organizations.
Since its founding in 1972, Pacific Continental Bank has been honored with numerous awards and recognitions from highly regarded third-party organizations including The Seattle Times, the Portland Business Journal, the Seattle Business magazine and Oregon Business magazine. A complete list of the companys awards and recognitions as well as supplementary information about Pacific Continental Bank can be found online at www.therightbank.com. Pacific Continental Corporations shares are listed on the Nasdaq Global Select Market under the symbol PCBK and are a component of the Russell 2000 Index.
Forward-Looking Statement Safe Harbor
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA). These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as anticipates, targets, expects, estimates, intends, plans, goals, believes anticipates and other similar expressions or future or conditional verbs such as will, should, would and could. The forward-looking statements made represent Pacific Continentals current estimates, projections, expectations, plans or forecasts of its future results and revenues, including but not limited to statements about performance, loan growth, capital position, liquidity, credit quality, credit quality trends and economic conditions generally. These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and are often beyond Pacific Continentals control. Actual outcomes and results may differ materially from those expressed in, or implied by, any of these forward-looking statements. You should not place undue reliance on any forward-looking statement and should consider all of the following uncertainties and risks, as well as those more fully discussed under Risk Factors, Business, and Managements Discussion and Analysis of Financial Condition and Results of Operations in Pacific Continentals most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, and in any of Pacific Continentals subsequent SEC filings, including the high concentration of loans of the Companys banking subsidiary in commercial and residential real estate lending and our significant concentration in loans to dental professionals; adverse economic trends in the United States and the markets we serve affecting the Banks borrower base; a continued decline in the housing and real estate market; a continued increase in unemployment or sustained high levels of unemployment; continued erosion or sustained low levels of consumer confidence; changes in the Federal Reserves monetary policies and the regulatory environment and increases in associated costs, particularly ongoing compliance expenses and resource allocation needs; vendor quality and efficiency; the Companys ability to control risks associated with rapidly changing technology both from an internal perspective as well as for external providers operational systems or infrastructure failures; increased competition; fluctuating interest rates; a tightening of available credit; the potential adverse impact of legal or regulatory proceedings; and risks related to acquisitions, including integration, retention of key personnel and business, anticipated cost savings and results and performance of the acquired company or the combined entity. Pacific Continental Corporation undertakes no obligation to publicly revise or update any forward-looking statement to reflect the impact of events or circumstances that arise after the date of this release. This statement is included for the express purpose of invoking PSLRAs safe harbor provisions.
PACIFIC CONTINENTAL CORPORATION
Consolidated Income Statements
(In thousands, except share and per share amounts)
(Unaudited)
Three months ended | Twelve months ended | |||||||||||||||
December 31, | December 31, | December 31, | December 31, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Interest and dividend income |
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Loans |
$ | 13,482 | $ | 12,002 | $ | 53,275 | $ | 48,091 | ||||||||
Taxable securities |
1,566 | 1,285 | 5,730 | 6,171 | ||||||||||||
Tax-exempt securities |
489 | 464 | 1,918 | 1,626 | ||||||||||||
Federal funds sold & interest-bearing deposits with banks |
2 | 2 | 10 | 6 | ||||||||||||
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15,539 | 13,753 | 60,933 | 55,894 | |||||||||||||
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Interest expense |
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Deposits |
803 | 909 | 3,389 | 4,059 | ||||||||||||
Federal Home Loan Bank & Federal Reserve borrowings |
284 | 325 | 1,189 | 1,584 | ||||||||||||
Junior subordinated debentures |
60 | 35 | 200 | 151 | ||||||||||||
Federal funds purchased |
4 | 3 | 16 | 24 | ||||||||||||
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1,151 | 1,272 | 4,794 | 5,818 | |||||||||||||
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Net interest income |
14,388 | 12,481 | 56,139 | 50,076 | ||||||||||||
Provision for loan losses |
| | 250 | 1,900 | ||||||||||||
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Net interest income after provision for loan losses |
14,388 | 12,481 | 55,889 | 48,176 | ||||||||||||
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Noninterest income |
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Service charges on deposit accounts |
490 | 468 | 1,926 | 1,827 | ||||||||||||
Other fee income, principally bankcard |
407 | 389 | 1,624 | 1,595 | ||||||||||||
Mortgage banking income |
| | | 72 | ||||||||||||
Bank-owned life insurance income |
128 | 152 | 515 | 583 | ||||||||||||
Loss on sale of investment securities |
| | (8 | ) | | |||||||||||
Impairment losses on investment securities (OTTI) |
(7 | ) | | (23 | ) | | ||||||||||
Other noninterest income |
545 | 373 | 1,792 | 1,664 | ||||||||||||
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1,563 | 1,382 | 5,826 | 5,741 | |||||||||||||
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Noninterest expense |
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Salaries and employee benefits |
5,776 | 4,855 | 22,120 | 19,576 | ||||||||||||
Premises and equipment |
938 | 820 | 3,684 | 3,373 | ||||||||||||
Data processing |
651 | 553 | 2,605 | 2,096 | ||||||||||||
Legal and professional fees |
407 | 357 | 1,867 | 1,735 | ||||||||||||
Business development |
430 | 470 | 1,805 | 1,558 | ||||||||||||
FDIC insurance assessment |
238 | 271 | 912 | 1,085 | ||||||||||||
Bankcard processing |
109 | 140 | 527 | 580 | ||||||||||||
Other real estate expense |
639 | 412 | 2,401 | 1,494 | ||||||||||||
Merger related expenses (1) |
| 203 | 1,246 | 203 | ||||||||||||
Other noninterest expense |
857 | 827 | 3,565 | 3,405 | ||||||||||||
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10,045 | 8,908 | 40,732 | 35,105 | |||||||||||||
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Income before provision for income taxes |
5,906 | 4,955 | 20,983 | 18,812 | ||||||||||||
Provision for income taxes |
2,254 | 1,572 | 7,216 | 6,159 | ||||||||||||
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Net income |
$ | 3,652 | $ | 3,383 | $ | 13,767 | $ | 12,653 | ||||||||
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Earnings per share: |
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Basic |
$ | 0.20 | $ | 0.19 | $ | 0.77 | $ | 0.70 | ||||||||
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Diluted |
$ | 0.20 | $ | 0.19 | $ | 0.76 | $ | 0.69 | ||||||||
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Weighted average shares outstanding: |
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Basic |
17,888,818 | 17,845,645 | 17,871,439 | 18,085,607 | ||||||||||||
Common stock equivalents attributable to stock-based awards |
237,455 | 152,564 | 188,484 | 152,553 | ||||||||||||
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Diluted |
18,126,273 | 17,998,209 | 18,059,923 | 18,238,160 | ||||||||||||
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PERFORMANCE RATIOS |
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Return on average assets |
1.00 | % | 0.99 | % | 0.96 | % | 0.96 | % | ||||||||
Return on average equity (book) |
8.06 | % | 7.33 | % | 7.61 | % | 6.97 | % | ||||||||
Return on average equity (tangible) (2) |
9.28 | % | 8.33 | % | 8.75 | % | 7.94 | % | ||||||||
Net interest margin (3) |
4.39 | % | 4.11 | % | 4.37 | % | 4.24 | % | ||||||||
Efficiency ratio (4) |
62.97 | % | 64.26 | % | 65.73 | % | 62.89 | % |
(1) | Represents expenses associated with the acquisition of Century Bank. |
(2) | Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions. |
(3) | Net interest margin is reported on a tax-equivalent yield basis at a 35% tax rate |
(4) | Efficiency ratio is noninterest expense divided by operating revenues. Operating revenues are net interest income plus noninterest income. |
PACIFIC CONTINENTAL CORPORATION
Consolidated Balance Sheets
(In thousands, except share amounts)
(Unaudited)
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
ASSETS |
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Cash and due from banks |
$ | 21,053 | $ | 28,607 | ||||
Interest-bearing deposits with banks |
55 | 94 | ||||||
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Total cash and cash equivalents |
21,108 | 28,701 | ||||||
Securities available-for-sale |
347,386 | 389,885 | ||||||
Loans, less allowance for loan losses and net deferred fees |
977,928 | 854,071 | ||||||
Interest receivable |
4,703 | 4,520 | ||||||
Federal Home Loan Bank stock |
10,425 | 10,462 | ||||||
Property and equipment, net of accumulated depreciation |
18,836 | 19,238 | ||||||
Goodwill and intangible assets |
23,616 | 22,031 | ||||||
Deferred tax asset |
9,598 | 6,230 | ||||||
Taxes receivable |
80 | | ||||||
Other real estate owned |
16,355 | 17,972 | ||||||
Prepaid FDIC assessment |
| 1,746 | ||||||
Bank-owned life insurance |
16,136 | 15,621 | ||||||
Other assets |
3,555 | 3,010 | ||||||
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Total assets |
$ | 1,449,726 | $ | 1,373,487 | ||||
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LIABILITIES AND SHAREHOLDERS EQUITY |
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Deposits |
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Noninterest-bearing demand |
$ | 366,891 | $ | 329,825 | ||||
Savings and interest-bearing checking |
559,632 | 554,693 | ||||||
Time $100,000 and over |
79,081 | 73,610 | ||||||
Other time |
85,377 | 88,026 | ||||||
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Total deposits |
1,090,981 | 1,046,154 | ||||||
Federal funds and overnight funds purchased |
5,150 | 11,570 | ||||||
Federal Home Loan Bank borrowings |
160,000 | 118,000 | ||||||
Junior subordinated debentures |
8,248 | 8,248 | ||||||
Accrued interest and other payables |
6,163 | 6,134 | ||||||
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Total liabilities |
1,270,542 | 1,190,106 | ||||||
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Shareholders equity |
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Common stock: 50,000,000 shares authorized. Shares issued and outstanding: 17,891,687 at December 31, 2013 and 17,835,088 at December 31, 2012 |
133,835 | 133,017 | ||||||
Retained earnings |
45,250 | 44,533 | ||||||
Accumulated other comprehensive income |
99 | 5,831 | ||||||
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179,184 | 183,381 | |||||||
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Total liabilities and shareholders equity |
$ | 1,449,726 | $ | 1,373,487 | ||||
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CAPITAL RATIOS |
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Total capital (to risk weighted assets) |
16.15 | % | 18.15 | % | ||||
Tier I capital (to risk weighted assets) |
14.90 | % | 16.90 | % | ||||
Tier I capital (to leverage assets) |
11.49 | % | 12.33 | % | ||||
Tangible common equity (to tangible assets)(1) |
10.91 | % | 11.94 | % | ||||
Tangible common equity (to risk-weighted assets)(1) |
14.18 | % | 16.67 | % | ||||
OTHER FINANCIAL DATA |
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Shares outstanding at end of period |
17,891,687 | 17,835,088 | ||||||
Tangible shareholders equity(1) |
$ | 155,568 | $ | 161,350 | ||||
Book value per share |
$ | 10.01 | $ | 10.28 | ||||
Tangible book value per share |
$ | 8.69 | $ | 9.05 |
(1) | Tangible common equity excludes goodwill and core deposit intangible assets related to acquisitions. |
PACIFIC CONTINENTAL CORPORATION
Loans by Type and Allowance for Loan Losses
(In thousands)
(Unaudited)
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
LOANS BY TYPE |
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Real estate secured loans: |
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Permanent loans: |
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Multi-family residential |
$ | 46,217 | $ | 45,212 | ||||
Residential 1-4 family |
46,438 | 51,437 | ||||||
Owner-occupied commercial |
249,311 | 219,276 | ||||||
Nonowner-occupied commercial |
158,786 | 145,315 | ||||||
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Total permanent real estate loans |
500,752 | 461,240 | ||||||
Construction loans: |
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Multi-family residential |
23,419 | 17,022 | ||||||
Residential 1-4 family |
26,512 | 20,390 | ||||||
Commercial real estate |
30,516 | 23,235 | ||||||
Commercial bare land and acquisition & development |
11,473 | 10,668 | ||||||
Residential bare land and acquisition & development |
6,990 | 8,405 | ||||||
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Total construction real estate loans |
98,910 | 79,720 | ||||||
Total real estate loans |
599,662 | 540,960 | ||||||
Commercial loans |
390,301 | 325,604 | ||||||
Consumer loans |
3,878 | 3,581 | ||||||
Other loans |
928 | 1,112 | ||||||
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Gross loans |
994,769 | 871,257 | ||||||
Deferred loan origination fees |
(924 | ) | (841 | ) | ||||
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993,845 | 870,416 | |||||||
Allowance for loan losses |
(15,917 | ) | (16,345 | ) | ||||
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$ | 977,928 | $ | 854,071 | |||||
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December 31, | December 31, | December 31, | December 31, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
ALLOWANCE FOR LOAN LOSSES |
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Balance at beginning of period |
$ | 16,802 | $ | 16,283 | $ | 16,345 | $ | 14,941 | ||||||||
Provision for loan losses |
| | 250 | 1,900 | ||||||||||||
Loan charge offs |
(1,039 | ) | (855 | ) | (2,088 | ) | (3,664 | ) | ||||||||
Loan recoveries |
154 | 917 | 1,410 | 3,168 | ||||||||||||
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Net recoveries (charge offs) |
(885 | ) | 62 | (678 | ) | (496 | ) | |||||||||
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Balance at end of period |
$ | 15,917 | $ | 16,345 | $ | 15,917 | $ | 16,345 | ||||||||
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PACIFIC CONTINENTAL CORPORATION
Selected Other Financial Information and Ratios
(In thousands)
(Unaudited)
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2013 | 2012 | 2013 | 2012 | |||||||||||||
BALANCE SHEET AVERAGES |
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Loans(1) |
$ | 990,566 | $ | 846,199 | $ | 959,873 | $ | 832,787 | ||||||||
Allowance for loan losses |
(16,709 | ) | (16,518 | ) | (16,492 | ) | (16,132 | ) | ||||||||
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Loans, net of allowance |
973,857 | 829,681 | 943,381 | 816,655 | ||||||||||||
Securities and short-term deposits |
350,101 | 401,537 | 366,102 | 384,918 | ||||||||||||
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Earning assets |
1,323,958 | 1,231,218 | 1,309,483 | 1,201,573 | ||||||||||||
Noninterest-earning assets |
122,739 | 126,878 | 123,730 | 115,521 | ||||||||||||
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Assets |
$ | 1,446,697 | $ | 1,358,096 | $ | 1,433,213 | $ | 1,317,094 | ||||||||
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Interest-bearing core deposits(2) |
$ | 626,161 | $ | 583,339 | $ | 631,529 | $ | 579,828 | ||||||||
Noninterest-bearing core deposits(2) |
361,046 | 317,029 | 336,063 | 297,428 | ||||||||||||
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Core deposits(2) |
987,207 | 900,368 | 967,592 | 877,256 | ||||||||||||
Noncore interest-bearing deposits |
101,263 | 103,851 | 106,574 | 95,598 | ||||||||||||
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Deposits |
1,088,470 | 1,004,219 | 1,074,166 | 972,854 | ||||||||||||
Borrowings |
173,038 | 164,966 | 173,919 | 158,254 | ||||||||||||
Other noninterest-bearing liabilities |
5,342 | 5,281 | 4,271 | 4,511 | ||||||||||||
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Liabilities |
1,266,850 | 1,174,466 | 1,252,356 | 1,135,619 | ||||||||||||
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Shareholders equity (book) |
179,847 | 183,630 | 180,857 | 181,475 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Liabilities and equity |
$ | 1,446,697 | $ | 1,358,096 | $ | 1,433,213 | $ | 1,317,094 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Shareholders equity (tangible)(3) |
$ | 156,154 | $ | 161,586 | $ | 157,278 | $ | 159,349 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
SELECTED MARKET DATA |
||||||||||||||||
Eugene market gross loans, period-end |
$ | 334,511 | $ | 253,345 | ||||||||||||
Portland market gross loans, period-end |
391,295 | 383,616 | ||||||||||||||
Seattle market gross loans, period-end |
132,488 | 154,229 | ||||||||||||||
National health care gross loans, period-end (4) |
136,475 | 80,067 | ||||||||||||||
|
|
|
|
|||||||||||||
Total gross loans, period-end |
$ | 994,769 | $ | 871,257 | ||||||||||||
|
|
|
|
|||||||||||||
Eugene market core deposits, period-end(2) |
$ | 588,158 | $ | 536,143 | ||||||||||||
Portland market core deposits, period-end(2) |
249,050 | 258,516 | ||||||||||||||
Seattle market core deposits, period-end(2) |
153,107 | 143,970 | ||||||||||||||
|
|
|
|
|||||||||||||
Total core deposits, period-end(2) |
990,315 | 938,629 | ||||||||||||||
Other deposits, period-end |
100,666 | 107,525 | ||||||||||||||
|
|
|
|
|||||||||||||
Total |
$ | 1,090,981 | $ | 1,046,154 | ||||||||||||
|
|
|
|
|||||||||||||
Eugene market core deposits, average(2) |
$ | 592,179 | $ | 518,487 | $ | 582,053 | $ | 508,856 | ||||||||
Portland market core deposits, average(2) |
242,855 | 241,585 | 244,997 | 236,200 | ||||||||||||
Seattle market core deposits, average(2) |
152,173 | 140,296 | 140,542 | 132,200 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total core deposits, average(2) |
987,207 | 900,368 | 967,592 | 877,256 | ||||||||||||
Other deposits, average |
101,263 | 103,851 | 106,574 | 95,598 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
$ | 1,088,470 | $ | 1,004,219 | $ | 1,074,166 | $ | 972,854 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
NET INTEREST MARGIN RECONCILIATION |
||||||||||||||||
Yield on average loans |
5.49 | % | 5.76 | % | 5.65 | % | 5.89 | % | ||||||||
Yield on average securities(5) |
2.63 | % | 1.98 | % | 2.37 | % | 2.25 | % | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Yield on average earning assets(5) |
4.74 | % | 4.53 | % | 4.73 | % | 4.72 | % | ||||||||
Rate on average interest-bearing core deposits |
0.32 | % | 0.41 | % | 0.34 | % | 0.47 | % | ||||||||
Rate on average interest-bearing non-core deposits |
1.18 | % | 1.17 | % | 1.17 | % | 1.38 | % | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Rate on average interest-bearing deposits |
0.44 | % | 0.53 | % | 0.46 | % | 0.41 | % | ||||||||
Rate on average borrowings |
0.80 | % | 0.88 | % | 0.81 | % | 1.11 | % | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Cost of interest-bearing funds |
0.51 | % | 0.59 | % | 0.53 | % | 0.70 | % | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Interest rate spread(5) |
4.23 | % | 3.93 | % | 4.21 | % | 4.03 | % | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net interest margin(5) |
4.39 | % | 4.11 | % | 4.37 | % | 4.24 | % | ||||||||
|
|
|
|
|
|
|
|
(1) | Includes loans held-for-sale. |
(2) | Core deposits include demand, interest checking, money market, savings, and local time deposits, including local nonpublic time deposits in excess of $100 thousand. |
(3) | Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions. |
(4) | National health care loans include loans to heath care professionals, primarily dental practitioners, operating outside of Pacific Continental Banks market area. The market area is defined as Oregon and Washington West of the Cascade Mountain Range. |
(5) | Tax-exempt income has been adjusted to a tax-equivalent basis at a 35% tax rate. The amount of such adjustment was an addition to recorded income of approximately $263 and $236 for the three months ended December 31, 2013, and December 31, 2012, respectively, and $1,033 thousand and $875 thousand for the twelve months ended December 31, 2013, and December 31 , 2012, respectively. |
PACIFIC CONTINENTAL CORPORATION
Nonperforming Assets and Asset Quality Ratios
(In thousands)
(Unaudited)
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
NONPERFORMING ASSETS |
||||||||
Non-accrual loans |
||||||||
Real estate secured loans: |
||||||||
Permanent loans: |
||||||||
Multi-family residential |
$ | | $ | | ||||
Residential 1-4 family |
636 | 1,140 | ||||||
Owner-occupied commercial |
1,685 | 3,805 | ||||||
Nonowner-occupied commercial |
136 | | ||||||
|
|
|
|
|||||
Total permanent real estate loans |
2,457 | 4,945 | ||||||
Construction loans: |
||||||||
Multi-family residential |
| | ||||||
Residential 1-4 family |
| | ||||||
Commercial real estate |
| | ||||||
Commercial bare land and acquisition & development |
| | ||||||
Residential bare land and acquisition & development |
| 101 | ||||||
|
|
|
|
|||||
Total construction real estate loans |
| 101 | ||||||
|
|
|
|
|||||
Total real estate loans |
2,457 | 5,046 | ||||||
Commercial loans |
2,886 | 4,315 | ||||||
|
|
|
|
|||||
Total nonaccrual loans |
5,343 | 9,361 | ||||||
90-days past due and accruing interest |
| | ||||||
Total nonperforming loans |
5,343 | 9,361 | ||||||
|
|
|
|
|||||
Nonperforming loans guaranteed by government |
(735 | ) | (905 | ) | ||||
Net nonperforming loans |
4,608 | 8,456 | ||||||
|
|
|
|
|||||
Other real estate owned |
16,355 | 17,972 | ||||||
|
|
|
|
|||||
Total nonperforming assets, net of guaranteed loans |
$ | 20,963 | $ | 26,428 | ||||
|
|
|
|
|||||
ASSET QUALITY RATIOS |
||||||||
Allowance for loan losses as a percentage of total loans outstanding |
1.60 | % | 1.88 | % | ||||
Allowance for loan losses as a percentage of total nonperforming loans, net of government guarantees |
345.42 | % | 193.29 | % | ||||
Net loan charge offs (recoveries) as a percentage of average loans, annualized |
0.07 | % | 0.06 | % | ||||
Net nonperforming loans as a percentage of total loans |
0.46 | % | 0.97 | % | ||||
Nonperforming assets as a percentage of total assets |
1.45 | % | 1.92 | % | ||||
Consolidated classified asset ratio(1) |
29.02 | % | 31.18 | % | ||||
Past due as a percentage of total loans (2) |
0.23 | % | 0.30 | % |
(1) | Classified asset ratio is defined as the sum of all loan-related contingent liabilities and loans internally graded substandard or worse, impaired loans (net of government guarantees), adversely classified securities, and other real estate owned, divided by total consolidated Tier 1 capital plus the allowance for loan losses. |
(2) | Defined as loans past due more than 30 days and still accruing interest, as a percentage of total loans, net of deferred fees. |
PACIFIC CONTINENTAL CORPORATION
Aged Analysis of Loans Receivable (Unaudited)
(In thousands)
As of December 31, 2013
Greater | ||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Than 90 Days | Total Past | |||||||||||||||||||||||||
Past Due | Past Due | Past Due | Due and | Total | Total Loans | |||||||||||||||||||||||
Still Accruing | Still Accruing | Still Accruing | Nonaccrual | Nonaccrual | Current | Receivable | ||||||||||||||||||||||
Real estate loans |
||||||||||||||||||||||||||||
Multi-family residential |
$ | | $ | | $ | | $ | | $ | | $ | 46,217 | $ | 46,217 | ||||||||||||||
Residential 1-4 family |
137 | | | 636 | 773 | 45,665 | 46,438 | |||||||||||||||||||||
Owner-occupied commercial |
488 | | | 1,685 | 2,173 | 247,138 | 249,311 | |||||||||||||||||||||
Nonowner-occupied commercial |
1,188 | | | 136 | 1,324 | 157,462 | 158,786 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total real estate loans |
1,813 | | | 2,457 | 4,270 | 496,482 | 500,752 | |||||||||||||||||||||
Construction |
||||||||||||||||||||||||||||
Multi-family residential |
| | | | | 23,419 | 23,419 | |||||||||||||||||||||
Residential 1-4 family |
| | | | | 26,512 | 26,512 | |||||||||||||||||||||
Commercial real estate |
| | | | | 30,516 | 30,516 | |||||||||||||||||||||
Commercial bare land and acquisition & development |
| | | | | 11,473 | 11,473 | |||||||||||||||||||||
Residential bare land and acquisition & development |
| | | | | 6,990 | 6,990 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total construction loans |
| | | | | 98,910 | 98,910 | |||||||||||||||||||||
Commercial and other |
436 | | | 2,886 | 3,322 | 387,907 | 391,229 | |||||||||||||||||||||
Consumer |
5 | 1 | | | 6 | 3,872 | 3,878 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total |
$ | 2,254 | $ | 1 | $ | | $ | 5,343 | $ | 7,598 | $ | 987,171 | $ | 994,769 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PACIFIC CONTINENTAL CORPORATION
Aged Analysis of Loans Receivable (Unaudited)
(In thousands)
As of December 31, 2012
Greater | ||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Than 90 Days | Total Past | |||||||||||||||||||||||||
Past Due | Past Due | Past Due | Due and | Total | Total Loans | |||||||||||||||||||||||
Still Accruing | Still Accruing | Still Accruing | Nonaccrual | Nonaccrual | Current | Receivables | ||||||||||||||||||||||
Real estate loans |
||||||||||||||||||||||||||||
Multi-family residential |
$ | | $ | | $ | | $ | | $ | | $ | 45,212 | $ | 45,212 | ||||||||||||||
Residential 1-4 family |
351 | 318 | | 1,140 | 1,809 | 49,628 | 51,437 | |||||||||||||||||||||
Owner-occupied commercial |
| | | 3,805 | 3,805 | 215,471 | 219,276 | |||||||||||||||||||||
Nonowner-occupied commercial |
1,404 | | | | 1,404 | 143,911 | 145,315 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total real estate loans |
1,755 | 318 | | 4,945 | 7,018 | 454,222 | 461,240 | |||||||||||||||||||||
Construction |
||||||||||||||||||||||||||||
Multi-family residential |
| | | | | 17,022 | 17,022 | |||||||||||||||||||||
Residential 1-4 family |
234 | | | | 234 | 20,156 | 20,390 | |||||||||||||||||||||
Commercial real estate |
| | | | | 23,235 | 23,235 | |||||||||||||||||||||
Commercial bare land and acquisition & development |
| | | | | 10,668 | 10,668 | |||||||||||||||||||||
Residential bare land and acquisition & development |
| | | 101 | 101 | 8,304 | 8,405 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total construction loans |
234 | | | 101 | 335 | 79,385 | 79,720 | |||||||||||||||||||||
Commercial and other |
264 | | | 4,315 | 4,579 | 322,137 | 326,716 | |||||||||||||||||||||
Consumer |
8 | | | | 8 | 3,573 | 3,581 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total |
$ | 2,261 | $ | 318 | $ | | $ | 9,361 | $ | 11,940 | $ | 859,317 | $ | 871,257 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PACIFIC CONTINENTAL CORPORATION
Credit Quality Indicators (Unaudited)
(In thousands)
As of December 31, 2013
Loan Grade | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Real estate loans |
||||||||||||||||||||
Multi-family residential |
$ | 44,677 | $ | | $ | 1,540 | $ | | $ | 46,217 | ||||||||||
Residential 1-4 family |
37,831 | | 8,607 | | 46,438 | |||||||||||||||
Owner-occupied commercial |
239,539 | 4,278 | 5,494 | | 249,311 | |||||||||||||||
Nonowner-occupied commercial |
153,055 | | 5,731 | | 158,786 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total real estate loans |
475,102 | 4,278 | 21,372 | | 500,752 | |||||||||||||||
Construction |
||||||||||||||||||||
Multi-family residential |
23,419 | | | | 23,419 | |||||||||||||||
Residential 1-4 family |
26,145 | | 367 | | 26,512 | |||||||||||||||
Commercial real estate |
28,978 | | 1,538 | | 30,516 | |||||||||||||||
Commercial bare land and acquisition & development |
11,223 | | 250 | | 11,473 | |||||||||||||||
Residential bare land and acquisition & development |
4,346 | | 2,644 | | 6,990 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total construction loans |
94,111 | | 4,799 | | 98,910 | |||||||||||||||
Commercial and other |
378,828 | | 12,401 | | 391,229 | |||||||||||||||
Consumer |
3,856 | | 22 | | 3,878 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total |
$ | 951,897 | $ | 4,278 | $ | 38,594 | $ | | $ | 994,769 | ||||||||||
|
|
|
|
|
|
|
|
|
|
PACIFIC CONTINENTAL CORPORATION
Credit Quality Indicators (Unaudited)
(In thousands)
As of December 31, 2012
Loan Grade | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Real estate loans |
||||||||||||||||||||
Multi-family residential |
$ | 43,883 | $ | | $ | 1,329 | $ | | $ | 45,212 | ||||||||||
Residential 1-4 family |
43,458 | | 7,979 | | 51,437 | |||||||||||||||
Owner-occupied commercial |
208,713 | | 10,563 | | 219,276 | |||||||||||||||
Nonowner-occupied commercial |
141,762 | | 3,553 | | 145,315 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total real estate loans |
437,816 | | 23,424 | | 461,240 | |||||||||||||||
Construction |
||||||||||||||||||||
Multi-family residential |
17,022 | | | | 17,022 | |||||||||||||||
Residential 1-4 family |
20,278 | | 112 | | 20,390 | |||||||||||||||
Commercial real estate |
21,646 | | 1,589 | | 23,235 | |||||||||||||||
Commercial bare land and acquisition & development |
10,668 | | | | 10,668 | |||||||||||||||
Residential bare land and acquisition & development |
5,449 | | 2,956 | | 8,405 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total construction loans |
75,063 | | 4,657 | | 79,720 | |||||||||||||||
Commercial and other |
317,250 | | 9,466 | | 326,716 | |||||||||||||||
Consumer |
3,544 | | 37 | | 3,581 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total |
$ | 833,673 | $ | | $ | 37,584 | $ | | $ | 871,257 | ||||||||||
|
|
|
|
|
|
|
|
|
|