FNB BANCORP/CA/ - FORM 8-K - EX-99.01 - EXHIBIT 99.01 - April 27, 2016

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Exhibit 99.01

Press Release

Available for Immediate Publication: April 27, 2016

 

First National Bank of Northern California Reports First Quarter 2016 Earnings of $0.55 Per Diluted Share

 

Source: FNB Bancorp (CA) (QTCQB:FNBG)

South San Francisco, California

Website: www.fnbnorcal.com

 

Contacts:

Tom McGraw, Chief Executive Officer (650) 875-4864

Dave Curtis, Chief Financial Officer (650) 875-4862

 

 

 

FNB Bancorp (QTCQB: FNBG), parent company of First National Bank of Northern California (the “Bank”), today announced net earnings available to common shareholders for the first quarter of 2016 of $2,567,000 or $0.55 per diluted share, compared to net earnings available to common shareholders of $1,799,000 or $0.39 per diluted share for the first quarter of 2015.

 

The first quarter of 2016 operating results, when compared to the same period a year ago, were positively affected by the completion of our America California Bank (“ACB”) acquisition that occurred in September, 2015. The ACB acquisition provided an opportunity for the Company to leverage our balance sheet and increase our interest earning assets and interest bearing liabilities, without a significant increase in operating expense. During the first quarter of 2016, our net interest income was $10.7 million, an increase of $483,000 from the fourth quarter of 2015.

 

“During the first quarter of 2016, the Company was able to grow our loans, net of allowance, by $11.2 million. This growth was achieved through our internal loan origination efforts. Also during the first quarter of 2016 we were able to increase our combined DDA and NOW deposit accounts by $13.2 million. The combination of all these things are what helped us to increase our net interest income during the quarter. Comparing the first quarter of 2016 with the fourth quarter of 2015, we were able to increase noninterest income slightly above fourth quarter levels, but noninterest expenses were significantly reduced due to the payment of non-recurring post acquisition expenses during the fourth quarter of 2015”, stated CEO Tom McGraw.

 

“During the first quarter of 2016, we were able to reduce our non-accrual loans from levels experienced at year-end. Nonperforming assets were also reduced from levels experienced at year-end. The Bank has worked hard to adhere to prudent underwriting standards as we continue to grow our loan portfolio. Our allowance for loan losses has remained relatively constant during the quarter. The first quarter provision for loan and lease losses was $75,000 and management believes the level of reserves are sufficient to meet expected losses inherent in our loan portfolio at March 31, 2016”, continue Tom McGraw.

 
 

CONSOLIDATED BALANCE SHEETS

(Dollars In Thousands)            

 

   (Unaudited)  
As of March 31,		 
   2016   2015 
ASSETS          
Cash and due from banks  $37,737   $30,640 
Interest-bearing time deposits with financial institutions   205    2,783 
Securities available for sale, at fair value   329,396    264,499 
Loans, net of deferred loan fees and allowance for loan losses   733,991    575,606 
Bank Premises, equipment and leasehold improvements, net   10,320    10,685 
Bank owned life insurance   15,946    12,594 
Other equity securities   6,756    5,773 
Accrued interest receivable   4,603    3,744 
Other real estate owned   1,055    770 
Goodwill   4,580    1,841 
Prepaid expenses   945    1,016 
Other assets   15,444    12,402 
TOTAL ASSETS  $1,160,978   $922,353 
           
LIABILITIES          
Deposits:          
Demand, noninterest bearing  $265,947   $222,400 
Demand, interest bearing   113,337    90,914 
Savings and money market   526,557    384,799 
Time   124,410    106,511 
Total Deposits   1,030,251    804,624 
Note payable   4,800    5,400 
Accrued expenses and other liabilities   17,230    12,292 
Total Liabilities   1,052,281    822,316 
STOCKHOLDERS’ EQUITY          
Common stock, no par value:   75,240    67,242 
Retained Earnings   29,666    29,944 
Accumulated other comprehensive earnings, net of tax   3,791    2,851 
Total Stockholders’ Equity   108,697    100,037 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $1,160,978   $922,353 
 
 

CONSOLIDATED STATEMENTS OF EARNINGS      

(Dollars In Thousands, Except Per Share Amounts)        

 

   (Unaudited)
Three Months Ended
March 31,		   Twelve Months Ended December 31, 
   2016   2015   2015   2014 
INTEREST INCOME                    
Interest and fees on loans  $9,871   $7,710   $33,235   $31,355 
Interest on dividends and securities   1,685    1,344    6,008    5,423 
Interest on deposits with other financial institutions   1    14    39    81 
Total interest income   11,557    9,068    39,282    36,859 
                     
INTEREST EXPENSE                    
Deposits   783    454    2,359    1,884 
Federal Home Loan Bank advances   8    1    9    17 
Interest on note payable   57    59    229    192 
Total interest expense   848    514    2,597    2,093 
NET INTEREST INCOME   10,709    8,554    36,685    34,766 
Provision for (recovery of) loan losses   75    75    (305)   (1,020)
NET INTEREST INCOME AFTER PROVISION FOR (RECOVERY OF) LOAN LOSSES   10,634    8,479    36,990    35,786 
NONINTEREST INCOME                    
Service charges   621    611    2,501    2,548 
Gain on sale of premises   —    —    —    2,085 
Net gain on sale of available-for-sale securities   184    69    339    138 
Earnings on bank owned life insurance   100    84    364    359 
Break-up fee from terminated definitive agreement   —    —    —    500 
Other income   237    314    1,292    959 
Total Noninterest Income   1,142    1,078    4,496    6,589 
NONINTEREST EXPENSES                    
Salaries and employee benefits   4,938    4,302    18,523    16,731 
Occupancy expense   631    668    2,517    2,773 
Equipment expense   434    405    1,926    1,624 
Professional fees   387    387    1,471    1,845 
FDIC assessment   150    150    600    655 
Telephone, postage, supplies   295    289    1,074    1,250 
Advertising expense   117    99    500    414 
Data processing expense   192    134    1,076    572 
Low income housing expense   71    71    283    439 
Surety insurance   87    88    381    278 
Director fees   72    72    288    252 
Gain on sale of other real estate owned   —    —    —    (220)
Other real estate owned (income) expense   (10)   —    4    87 
Other expenses   423    278    1,282    1,168 
Total Noninterest Expense   7,787    6,943    29,925    27,868 
EARNINGS BEFORE PROVISION FOR INCOME TAXES   3,989    2,614    11,561    14,507 
Provision for income taxes   1,422    815    3,364    5,098 
NET EARNINGS   2,567    1,799    8,197    9,409 
Dividends and discount accretion on preferred stock   —    —    —    170 
NET EARNINGS AVAILABLE TO COMMON STOCKHOLDERS  $2,567   $1,799   $8,197   $9,239 
 
 

Per Share Data:                
Basic earnings per share available to common stockholders  $0.56   $0.40   $1.82   $2.08 
Diluted earnings per share available to common stockholders  $0.55   $0.39   $1.77   $2.02 
Cash dividends declared  $683   $555   $2,447   $1,780 
Average shares outstanding   4,550    4,487    4,516    4,444 
Average diluted shares outstanding   4,687    4,623    4,644    4,585 

 

FINANCIAL HIGHLIGHTS      

(Dollars In Thousands)      

 

   (Unaudited)
Three Months Ended
March 31,		   (Extracted from
audited annual
financial statements)
Twelve Months Ended
December 31,		 
   2016   2015   2015   2014 
AVERAGE BALANCES:                    
Total Assets  $1,146,493   $919,313   $1,010,435   $901,533 
Total Loans   743,282    587,903    629,814    572,070 
Total Earning Assets   1,072,790    848,925    923,700    840,360 
Total Deposits   1,012,268    801,718    890,369    785,481 
Total Stockholder’s Equity   106,219    98,140    100,621    90,938 
                     
SELECTED PERFORMANCE DATA                    
Annualized return on average assets   0.90%   0.78%   0.81%   1.02%
Annualized return on average equity   9.67%   7.33%   8.15%   10.16%
Net interest margin (taxable equivalent)   4.14%   4.17%   4.06%   4.21%
Average loans as a percent of average deposits   73.43%   73.33%   70.70%   72.83%
Average total stockholders’ equity as a% of average total assets   9.26%   10.68%   9.96%   10.09%
Annualized common dividend payout ratio   26.61%   30.85%   29.85%   19.27%
 
 

NON-PERFORMING ASSETS      (Extracted from             
(Dollars In Thousands)      audited annual             
   (Unaudited)   financial statements)   (Unaudited) As of   (Unaudited)   (Unaudited) 
   March 31,   December 31,   September 30,   June 30,   March 31, 
   2016   2015   2015   2015   2015 
Non-accrual loans   6,882    7,915    5,192    6,020    5,923 
Other real estate owned   1,055    1,026    838    806    770 
Total non-performing assets   7,937    8,941    6,030    6,826    6,693 
                          
                          
Loan loss reserve  $9,943   $9,970   $9,940   $9,836   $9,744 
Non-accrual loans/Gross loans   0.92%   1.08%   0.73%   1.03%   1.01%
Loan loss reserves/Gross loans   1.33%   1.36%   1.40%   1.69%   1.66%

 

CONSOLIDATED BALANCE SHEETS      (Extracted from             
(Dollars In Thousands)      audited annual             
   (Unaudited)   financial statements)   (Unaudited)   (Unaudited)   (Unaudited) 
   March 31,   December 31,   As of
September 30,		   June 30,   March 31, 
   2016   2015   2015   2015   2015 
ASSETS                         
Cash and due from banks  $37,737   $12,314   $40,282   $91,662   $30,640 
Interest-bearing time deposits with financial institutions   205    205    1,246    2,138    2,783 
Securities available for sale, at fair value   329,396    329,207    315,560    295,171    264,499 
Loans, net of deferred loan fees and allowance for loan losses   733,991    722,747    696,888    571,665    575,606 
Bank Premises, equipment and leasehold improvements, net   10,320    10,202    10,326    10,527    10,685 
Bank owned life insurance   15,946    15,845    15,742    12,681    12,594 
Other equity securities   6,756    6,748    6,748    6,069    5,773 
Accrued interest receivable   4,603    4,511    4,326    3,909    3,744 
Other real estate owned   1,055    1,026    838    806    770 
Goodwill   4,580    4,580    4,580    1,841    1,841 
Prepaid expenses   945    997    877    922    1,016 
Other assets   15,444    15,967    14,044    12,437    12,402 
TOTAL ASSETS  $1,160,978   $1,124,349   $1,111,457   $1,009,828   $922,353 
                          
LIABILITIES                         
Deposits:                         
Demand, noninterest bearing  $265,947   $263,822   $262,206   $249,420   $222,400 
Demand, interest bearing   113,337    102,304    84,682    101,693    90,914 
Savings and money market   526,557    491,633    512,534    437,092    384,799 
Time   124,410    125,430    129,943    104,935    106,511 
Total Deposits   1,030,251    983,189    989,365    893,140    804,624 
Federal Home Loan Bank advances   —    17,000    —    —    — 
Note payable   4,800    4,950    5,100    5,250    5,400 
Accrued expenses and other liabilities   17,230    15,048    13,302    11,001    12,292 
Total Liabilities   1,052,281    1,020,187    1,007,767    909,391    822,316 
STOCKHOLDERS’ EQUITY                         
Common stock, no par value:   75,240    74,805    67,852    67,597    67,242 
Retained Earnings   29,666    27,816    33,046    31,452    29,944 
Accumulated other comprehensive earnings, net of tax   3,791    1,541    2,792    1,388    2,851 
Total Stockholders’ Equity   108,697    104,162    103,690    100,437    100,037 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $1,160,978   $1,124,349   $1,111,457   $1,009,828   $922,353 

 
 
CONSOLIDATED STATEMENTS OF INCOME          (Unaudited)         
(Dollars In Thousands, Except Per Share Amounts)        Three Months Ended         
   March 31,   December 31,   September 30,   June 30,   March 31, 
   2016   2015   2015   2015   2015 
INTEREST INCOME                         
Interest and fees on loans  $9,871   $9,361   $8,309   $7,855   $7,710 
Interest on dividends and securities   1,685    1,657    1,575    1,432    1,344 
Interest on deposits with other financial institutions   1    3    9    13    14 
Total interest income   11,557    11,021    9,893    9,300    9,068 
                          
INTEREST EXPENSE                         
Deposits   783    734    635    538    454 
Federal Home Loan Bank advances   8    7    1    —    1 
Interest on note payable   57    56    57    57    59 
Total interest expense   848    797    693    595    514 
NET INTEREST INCOME   10,709    10,224    9,200    8,705    8,554 
Provision for (recovery of) loan losses   75    (530)   75    75    75 
NET INTEREST INCOME AFTER PROVISION FOR (RECOVERY OF) LOAN LOSSES   10,634    10,754    9,125    8,630    8,479 
NONINTEREST INCOME                         
Service charges   621    647    618    627    611 
Net gain on sale of available-for-sale securities   184    89    29    152    69 
Earnings on bank owned life insurance   100    103    90    87    84 
Other income   237    290    287    401    314 
Total Noninterest Income   1,142    1,129    1,024    1,267    1,078 
NONINTEREST EXPENSES                         
Salaries and employee benefits   4,938    6,010    4,100    4,111    4,302 
Occupancy expense   631    611    592    646    668 
Equipment expense   434    393    718    410    405 
Professional fees   387    396    334    354    387 
FDIC assessment   150    150    150    150    150 
Telephone, postage, supplies   295    292    237    256    289 
Advertising expense   117    119    112    170    99 
Data processing expense   192    136    659    147    134 
Low income housing expense   71    71    70    71    71 
Surety insurance   87    83    122    88    88 
Director fees   72    72    72    72    72 
Other real estate owned (income) expense   (10)   10    —    (6)   — 
Other expenses   423    371    313    320    278 
Total Noninterest Expense   7,787    8,714    7,479    6,789    6,943 
EARNINGS BEFORE PROVISION FOR INCOME TAXES   3,989    3,169    2,670    3,108    2,614 
Provision for income taxes   1,422    1,081    431    1,037    815 
NET EARNINGS AVAILABLE TO COMMON STOCKHOLDERS  $2,567   $2,088   $2,239   $2,071   $1,799 

 
 

           (Unaudited)         
         Three Months Ended         
   March 31,   December 31,   September 30,   June 30,   March 31, 
   2016   2015   2015   2015   2015 
Per Share Data:                         
Basic earnings per share available to common stockholders  $0.56   $0.47   $0.49   $0.46   $0.40 
Diluted earnings per share available to common stockholders  $0.55   $0.45   $0.48   $0.45   $0.39 
Cash dividends declared  $683   $648   $646   $559   $555 
Average shares outstanding   4,550    4,487    4,524    4,511    4,487 
Average diluted shares outstanding   4,687    4,623    4,643    4,636    4,623 
                          
SELECTED PERFORMANCE DATA                         
Annualized return on average assets   0.90%   0.91%   0.86%   0.87%   0.78%
Annualized return on average equity   9.67%   8.51%   8.88%   8.31%   7.33%
Net interest margin (taxable equivalent)   4.14%   4.17%   4.00%   4.14%   4.17%
Average loans as a percent of average deposits   73.43%   71.11%   67.72%   70.63%   73.33%
Average total stockholders’ equity as a % of average total assets   9.26%   10.68%   9.69%   10.46%   10.68%
Annualized common dividend payout ratio   26.61%   31.03%   28.85%   26.99%   30.85%

 

 

LOANS      (Extracted from             
(Dollars In Thousands)      audited annual             
   (Unaudited)   financial statements)   (Unaudited)
   (Unaudited)   (Unaudited) 
   March 31,   December 31,   As of
September 30,		   June 30,   March 31, 
   2016   2015   2015   2015   2015 
Real Estate Loans:                         
Construction  $42,465   $44,816   $35,868   $32,648   $34,237 
Commercial   411,999    399,993    394,090    330,303    322,414 
 Multi family   59,993    63,597    63,928    51,613    53,703 
Residential   173,437    171,964    172,280    127,900    128,105 
Commercial & industrial loans   55,694    52,033    39,843    37,745    45,589 
Consumer loans   1,675    1,574    1,497    1,696    1,697 
Gross Loans   745,263    733,977    707,506    581,905    585,745 
Net deferred loan fees   (1,329)   (1,260)   (678)   (404)   (395)
Allowance for loan losses   (9,943)   (9,970)   (9,940)   (9,836)   (9,744)
NET LOANS  $733,991   $722,747   $696,888   $571,665   $575,606 

 

Cautionary Statement: This release contains certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those stated herein. Management’s assumptions and projections are based on their anticipation of future events and actual performance may differ materially from those projected. Risks and uncertainties which could impact future financial performance include, among others, (a) competitive pressures in the banking industry; (b) changes in the interest rate environment; (c) general economic conditions, either nationally or regionally or locally, including fluctuations in real estate values; (d) changes in the regulatory environment; (e) changes in business conditions or the securities markets and inflation; (f) possible shortages of gas and electricity at utility companies operating in the State of California, and (g) the effects of terrorism, including the events of September 11, 2001, and thereafter, and the conduct of war on terrorism by the United States and its allies. Therefore, the information set forth herein, together with other information contained in the periodic reports filed by FNB Bancorp with the Securities and Exchange Commission, should be carefully considered when evaluating its business prospects. FNB Bancorp undertakes no obligation to update any forward-looking statements contained in this release.

 

FNB BANCORP/CA/ Reports