Atlantic Bank Announces Increased Quarterly Earnings.BOSTO--(BUSINESS WIRE)--April 27, 1998--Atlantic Bank (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ATLB) announced consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: net income for the quarter ended March 31, 1998 of $2,072,000, a 57% increase compared to $1,319,000 for the same quarter of 1997. On a diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis, earnings per share were $0.48 for the quarter ended March 31, 1998 compared to $0.31 for the quarter ended March 31, 1997. "We are pleased to again report strong earnings and substantial growth in our loan portfolio" said Nicholas Nicholas, Russian grand duke Nicholas (Nikolai Nikolayevich) (nyĭkəlī` nyĭkəlī`əvĭch), 1856–1929, Russian grand duke and army officer; first cousin of Czar Alexander III and grandson of Czar W. Lazares, Chairman. "Our return on average assets was 2.51% for the first quarter of 1998 compared to 2.24% for the same period in 1997 and our return on average equity for the quarter was 25.82% compared to 20.13% for the same period in 1997. This quarter's results reflect the Bank's successful execution of its business strategy of acquiring discounted commercial loans. This business has enabled us to generate a relatively high net interest margin and other income through asset resolutions." Mr. Lazares commented that "Our 1998 first quarter loan acquisition volume was significant; we acquired loans with outstanding principal balances of $67.3 million at a price of $57.7 million. This represents the largest volume of first quarter purchases to date and reflects our development of both established and new alliances in the private sector." Richard Wayne Dr. Richard Wayne (April 4, 1804 – June 27, 1858) served as mayor of Savannah, Georgia for four terms: 1844 - 1845, 1848 - 1851, 1852 - 1853 and 1857 - 1858. He died while in office.[1] Wayne was the first mayor of Savannah elected by its citizens. , President, commented that "We are pleased to announce that during the first quarter of 1998 we established Atlantic Preferred Capital Corporation, a real estate investment trust that we believe will provide us with significant tax benefits and enhance our ability to raise additional capital in the future." Mr. Wayne Wayne, city (1990 pop. 19,899), Wayne co., SE Mich., a suburb of Detroit, on the Lower Rouge River; inc. as a village 1869, and with surrounding areas as a city 1960. It has automobile and aircraft industries and other varied manufactures. continued "Non-performing assets declined to 2.16% of assets at March 31, 1998 compared to 3.27% of assets at December December: see month. 31, 1997. This is largely a result of the Bank's focus on asset quality, and its efforts directed at converting non-performing assets to performing status. Our balance sheet remains strong with discount as a percentage of purchased loans amounting to 16.58% at March 31, 1998 and our allowance for loan losses as a percentage of non-performing originated loans amounting to 785.29% at that date. We are pleased with the Bank's performance thus far and look forward to the opportunities that lie ahead." In April, the Bank entered into an agreement to acquire the operating assets Operating Assets Another term for working capital. of Forrest For·rest , Nathan Bedford 1821-1877. American Confederate general who was active at the battles of Shiloh (1862) and Chickamauga (1863). He was a founder and the first leader (1866-1869) of the Ku Klux Klan. Holdings, Inc., ("Forrest"), a leasing company with offices in Lisle, Illinois Lisle is a village in DuPage County, Illinois, United States. The population was 21,182 at the 2000 census, and estimated to be 23,376 as of 2005. It is part of the Chicago metropolitan area and the Illinois Technology and Research Corridor. and Moberly, Missouri Moberly is a city in Randolph County, Missouri, United States. The population was 11,945 at the 2000 census. The city was incorporated 1868. The Moberly Micropolitan Statistical Area consists of Randolph County. . Forrest originated approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $48 million of leasing transactions in 1997. The purchase price will range from approximately $2.7 million to $3.0 million in cash and stock and will not include leases originated by Forrest prior to the closing. This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. regarding future events or financial performance. These statements are only predictions and actual events or results may differ materially. Investors should refer to the documents that the Bank files from time to time with the Federal Deposit Insurance Corporation Federal Deposit Insurance Corporation (FDIC), an independent U.S. federal executive agency designed to promote public confidence in banks and to provide insurance coverage for bank deposits up to $100,000. , specifically the cautionary statement identifying certain factors that could affect future results included in the Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial section of its most recent Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. . -0- An analysis of selected results for the three-month period ended March 31, 1998 follows. Net interest income increased $1,040,000 or 24.8% in the first quarter of 1998 compared to the corresponding period in 1997. This increase is primarily a result of an increase in interest income of $2,491,000 or 35.4% related to the Bank's expansion of its purchased loan portfolio. The increase in interest income was offset by an increase in interest expense of $1,451,000 or 51.1% from the first quarter of 1997 to the first quarter of 1998. The increase in interest expense was primarily a result of an increase in the Bank's deposit base to fund the expansion of the purchased loan portfolio. Other operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased $522,000 or 23.0% for the three months ended March 31, 1998 compared to the corresponding period in 1997. This increase is primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the Bank's growth during the period. The Bank's effective tax rate decreased from 41.7% to 27.0% for the three months ended March 31, 1998 compared to the three months ended March 31, 1997. This is a result of a reduction in tax expense related to the establishment of a real estate investment trust which reduced the Bank's tax rate by approximately 6.5% and increased earnings per share by approximately $.04, and the recognition of a historical tax credit relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the renovation of the Bank's new main office building which reduced the Bank's tax rate by approximately 8.5% and increased earnings per share by approximately $.06. The historical tax credit will be recognized ratably throughout 1998. Atlantic Bank had total assets of $375.3 million at March 31, 1998, a $53.6 million or 16.6% increase from total assets of $321.8 million at December 31, 1997. Net loans increased to $299.7 million at March 31, 1998 from $254.8 million at December 31, 1997, representing an increase of $44.8 million or 17.6%. The Bank's total capital at March 31, 1998 was $33,864,000, or 9.0% of total assets. The Bank continues to be categorized cat·e·go·rize tr.v. cat·e·go·rized, cat·e·go·riz·ing, cat·e·go·riz·es To put into a category or categories; classify. cat as "well capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. " by FDIC FDIC See: Federal Deposit Insurance Corporation FDIC See Federal Deposit Insurance Corporation (FDIC). standards. Atlantic Bank is a Massachusetts Massachusetts (măsəch  `sĭts), most populous of the New England states of the NE United States. chartered, FDIC insured The person who obtains or is otherwise covered by insurance on his or her health, life, or property. The insured in a policy is not limited to the insured named in the policy but applies to anyone who is insured under the policy. insured n. trust company which conducts business from its executive and main offices in downtown Downtown (called a "city centre" in British English) is a term used in North America when referring to a city's core, usually both in a geographical and commercial / community sense. Boston Boston, town, England Boston, town (1991 pop. 26,495), E central England, on the Witham River. Boston's fame as a port dates from the 13th cent., when it was a Hanseatic port trading wool and wine. Having recovered from a decline in the 18th and 19th cent. and a branch in Chestnut Hill, Massachusetts Located six miles west of downtown Boston, Massachusetts, Chestnut Hill is a wealthy suburban village notable for its stately old houses, scenic landscape, and the historic campus of Boston College. . -0-
Atlantic Bank
Consolidated Financial Highlights
(Unaudited)
March 31, December 31,
1998 1997
(dollars in thousands,
except per share data)
Total assets $ 375,338 $ 321,776
Purchased loans 280,827 227,147
Total discount (46,549) (40,184)
Originated loans 68,154 70,530
Allowance for loan losses (2,403) (2,273)
Net deferred loan income (353) (388)
Loans, net 299,676 254,832
Investment securities 13,215 7,817
Deposits 336,659 285,522
Stockholders' equity 33,864 31,801
Non-performing assets:
Other real estate owned, net 1,467 3,591
Non-performing originated loans 306 450
Non-performing purchased loans 6,327 6,468
Total non-performing assets 8,100 10,509
Accruing loans past due ninety
days or more 721 --
Total non-performing assets to
total assets 2.16% 3.27%
Discount as a percentage of
purchased loans 16.58 17.69
Non-amortizing discount as a
percentage of purchased loans 10.29 9.74
Allowance for loan losses as
a percentage of originated loans 3.53 3.22
Allowance for loan losses as a
percentage of non-performing
originated loans 785.29 505.11
Book value per share $ 8.35 $ 7.84
Tangible book value per share 8.33 7.82
4,055,526 4,055,526
Capital ratios:
Tier 1 leverage 10.08% 10.55%
Tier 1 risk-based 10.98 11.98
Total risk-based 11.76 12.84
-0-
Atlantic Bank
Consolidated Operating Results and Related Financial Data
(Unaudited)
Three Months Ended
March 31,
1998 1997
(in thousands,
except per share data)
Interest income $ 9,523 $ 7,032
Interest expense (4,293) (2,842)
Net interest income 5,230 4,190
Provision for loan losses (125) (225)
Net interest income, after provision for
loan losses 5,105 3,965
Gains on sales of originated loans -- 117
Gain on sales of securities 42 --
Other income (expense) (34) 111
Operating expenses:
Other real estate owned income, net 518 338
Other operating expenses (2,791) (2,269)
Total operating expenses (2,273) (1,931)
Income before income taxes 2,840 2,262
Provision for income taxes (768) (943)
Net income $ 2,072 $ 1,319
Weighted average shares outstanding:
Basic 4,056 4,021
Diluted 4,361 4,271
Earnings per share:
Basic $ 0.51 $ 0.33
Diluted 0.48 0.31
Financial ratios (annualized):
Return on average assets 2.51% 2.24%
Return on average stockholders' equity 25.82% 20.13%
-0-
Atlantic Bank
Interest Rate and Loan Volume Analysis
(Unaudited)
Three Months Ended
March 31,
1998 1997
(dollars in thousands)
Weighted average yield/rate (annualized):
Short-term investments 5.38 % 5.17 %
Securities available for sale 5.73 6.37
Purchased loan portfolio, net 15.26 15.50
Originated loan portfolio, net 11.27 11.77
Total interest-earning assets 12.32 % 12.76 %
Deposits 5.92 % 5.76 %
Interest rate spread 6.40 % 7.00 %
Net interest margin 6.77 % 7.60 %
Loan volume:
Originations $ 3,309 $ 2,561
Acquisitions:
Loan balances 67,316 59,415
Discount (9,594) (15,365)
Acquisitions, net 57,722 44,050
Total loan volume, net $ 61,031 $ 46,611
-0- CONTACT: Atlantic Bank, 617-880-1000 Nicholas W. Lazares Richard Wayne Chairman and President and Co-Chief Executive Officer Co-Chief Executive Officer or John L. Champion Senior Vice President and Chief Financial Officer |
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