Atlantic Bank announces increased quarterly earnings.BOSTON--(BUSINESS WIRE)--May 7, 1997--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, 1997 of $1,319,000, a 114% increase compared to $617,000 for the same quarter of 1996. On a fully 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 $0.31 for the quarter ended March 31, 1997 compared to $0.28 for the quarter ended March 31, 1996. The Bank's outstanding stock increased by 1,862,500 shares as a result of its $9.9 million public stock offering completed in April 1996. "We continue to achieve 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 increased to 2.24% for the first quarter of 1997 compared to 1.97% for the same period in 1996 and our return on average equity for the quarter again exceeded 20%. These returns reflect a continuation of the Bank's niche business strategy of acquiring discounted commercial loans and the relatively high net interest margin that results from the execution of that strategy." Mr. Lazares commented that "Historically, the volume of loans available for sale during the first quarter has not been significant. However, during the first quarter of 1997, we acquired loans with outstanding principal balances of $59,415,000 at a price of $44,050,000. These acquisitions represent our largest volume of first quarter purchases to date. We attribute (1) In relational database management, a field within a record. (2) In object technology, a single element of data. See instance attribute and static attribute. the increase in loans for sale not only to the consolidation of certain area banks but also to the expanded availability of loans that do not meet the criteria criteria (krītēr´ē  ),n. for securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. ." 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 "The Bank continues to focus its efforts on asset quality, placing significant emphasis on restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). acquired nonperforming credits to performing status. In addition, during the first quarter the Bank reduced its exposure in the asset-based lending Asset-Based Lending A business loan secured by collateral (assets). The loan, or line of credit, is secured by inventory, accounts receivable and/or other balance-sheet assets. Also known as "commercial finance" or "asset-based financing". sector of its portfolio by selling certain loans with an aggregate outstanding balance of $3,549,000 for a gain of $117,000. This transaction not only helped achieve certain risk management objectives but also allowed the Bank to focus on its primary growth strategy. We are pleased with the Bank's performance thus far and look forward to the opportunities that lie ahead." -0- An analysis of selected results for the three-month period ended March 31, 1997 follows. In general, the Bank begins to accrue To increase; to augment; to come to by way of increase; to be added as an increase, profit, or damage. Acquired; falling due; made or executed; matured; occurred; received; vested; was created; was incurred. interest income on acquired nonperforming loans at the time payments are initiated or the credit is restructured to a level that conforms with appropriate credit standards Credit Standards The guidelines a company follows to determine whether a credit applicant is creditworthy. . At December December: see month. 31, 1996, the Bank had not yet begun to recognize interest income on nonperforming loans acquired in the fourth quarter with a net carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of $23,808,000. During the first quarter of 1997, $8,493,000 of such loans were transferred to performing status. In addition, the Bank transferred $12,312,000 of nonperforming loans that were acquired in the fourth quarter to nonperforming status at March 31, 1997. This transfer constituted 97.9% of the net increase in nonperforming purchased loans from December 31, 1996 to March 31, 1997. Such loans are generally in the process of being restructured; those loans that cannot be restructured to meet the Bank's portfolio objectives will be considered for sale or other disposition. The Bank's net interest income for the three months ended March 31, 1997 increased by $1,443,000 compared to 1996. Interest income increased to $7,032,000, a $2,287,000 or 48.2% increase over the same period in 1996, while interest expense increased to $2,842,000, an increase of $844,000 or 42.2% compared to the same period in 1996. Both increases are largely attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the expansion and funding of the Bank's purchased loan portfolio. Total 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. were $1,931,000 for the three months ended March 31, 1997, compared to $1,612,000 for the same period in 1996. This increase is primarily attributable to increases in compensation and related benefits offset by an increase in gains on sales of other real estate owned Real Estate Owned Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most and a decline in professional fees. The Bank's ratio of allowance for loan losses to originated loans outstanding was 3.09% at March 31, 1997, and its non- non- word element [L.]not . non- pref. Not: noninvasive. amortizing discount stood at 14.58% of purchased loans as of that date. Atlantic Bank had total assets of $263 million at March 31, 1997, a $106 million or 67.5% increase over total assets at March 31, 1996. The Bank's total capital at March 31, 1997 was $27,075,000, or 10.3% 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 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, EnglandBoston, 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. .
Atlantic Bank
Consolidated Financial Highlights
(Unaudited)
March 31, December 31,
1997 1996
(dollars in thousands, except per share data)
Total assets $263,299 $230,789
Purchased loans 188,222 152,228
Total discount (42,691) (38,192)
Originated loans 72,328 72,126
Allowance for loan losses (2,233) (1,965)
Net deferred loan income (433) (500)
Loans, net 215,193 183,697
Investment securities 9,676 5,822
Deposits 231,882 199,575
Stockholders' equity 27,075 25,760
Non-performing assets:
Other real estate owned, net 4,555 4,688
Non-performing originated loans 897 1,047
Non-performing purchased loans 14,635 2,059(a)
Total non-performing assets 20,087 7,794
Accruing loans past due ninety
days or more 2,272 825
Total non-performing assets to total
assets 7.63% 3.38%
Discount as a percentage of purchased
loans 22.68 25.09
Non-amortizing discount as a
percentage of purchased loans 14.58 16.02
Allowance for loan losses as a
percentage of originated loans 3.09 2.72
Allowance for loan losses as a
percentage of non-performing
originated loans 248.94 187.68
Book value per share $ 6.73 $ 6.41
Tangible book value per share 6.71 6.38
Shares outstanding, net 4,021,338 4,021,338
Capital ratios:
Tier 1 leverage 11.32% 12.05%
Tier 1 risk-based 12.22 13.44
Total risk-based 13.23 14.47
(a)-Fourth quarter loan acquisitions with a net carrying value of
$23,808,000 at December 31, 1996, while non-performing at the time
of purchase based on original loan contracts, are not classified as
such unless they become non-performing based on the acquisition dates.
-0-
Atlantic Bank
Consolidated Operating Results and Related Financial Data
(Unaudited)
Three Months Ended
March 31,
1997 1996
(in thousands, except per share data)
Interest income $ 7,032 $ 4,745
Interest expense (2,842) (1,998)
Net interest income 4,190 2,747
Provision for loan losses (225) (250)
Net interest income, after
provision for loan losses 3,965 2,497
Gains on sales of loans 117 42
Other income 111 101
Operating expenses:
Other real estate owned income, net 338 118
Other operating expenses (2,269) (1,730)
Total operating expenses (1,931) (1,612)
Income before income taxes 2,262 1,028
Provision for income taxes (943) (411)
Net income $ 1,319 $ 617
Weighted average shares outstanding:
Primary 4,271 2,231
Fully diluted 4,283 2,231
Earnings per share:
Primary $ 0.31 $ 0.28
Fully diluted 0.31 0.28
Financial ratios (annualized):
Return on average assets 2.24% 1.97%
Return on average stockholders'
equity 20.13 22.36
-0-
Atlantic Bank
Interest Rate and Loan Volume Analysis
(Unaudited)
Three Months Ended
March 31,
1997 1996
(dollars in thousands)
Weighted average yield/rate:
Short-term investments 5.17% 5.17%
Investment securities 6.37 6.33
Purchased loan portfolio, net 15.50 17.20
Originated loan portfolio, net 11.77 12.38
Total interest-earning assets 12.76% 13.37%
Interest-bearing deposits 5.76% 5.84%
Interest rate spread 7.00% 7.53%
Net interest margin 7.60% 7.74%
Loan volume:
Originations $ 2,561 $ 4,005
Acquisitions:
Loan balances 59,415 5,329
Discount (15,365) (1,700)
Acquisitions, net 44,050 3,629
Total loan volume,net $46,611 $ 7,634
CONTACT: Atlantic Bank Nicholas W. Lazares Richard Wayne Chairman and President and Co-Chief Executive Officer Co-Chief Executive Officer or John L. Champion 617-330-8585 Senior Vice President and Chief Financial Officer |
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