Benjamin Franklin Bancorp Reports Results for Second Quarter of 2006; Declares Quarterly Dividend; Announces Stock Purchase in Connection with Stock Incentive Plan.FRANKLIN Franklin, cities, United States Franklin. 1 City (1990 pop. 12,907), seat of Johnson co., S central Ind., inc. 1823. It is a farm trade center. Manufactures include auto parts, aluminum doors and windows, and copper panels. , Mass. -- Benjamin Franklin Bancorp, Inc. (the "Company" or "Benjamin Franklin") (Nasdaq: BFBC BFBC Bracknell Forest Borough Council BFBC Battlefield Bad Company (video game) BFBC Bicycle-Friendly Berkeley Coalition BFBC Best Florida Beer Championship BFBC Big Freakin' Brown Cloud ), the bank holding company for Benjamin Franklin Bank (the "Bank"), today reported net income of $1.3 million, or $.16 per share (basic and 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. ), for the quarter ended June June: see month. 30, 2006. For the six months ended June 30, 2006, the Company reported earnings of $2.5 million or $.32 per share. Comparable 2005 results were affected by two non-recurring charges, resulting in a $2.5 million loss for the second quarter of 2005 and a $2.2 million loss for the 6 months ended June 30, 2005. The Company also today announced that its Board of Directors declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. a quarterly cash dividend of $.03 per common share, payable on August 25, 2006 to stockholders of record as of August 11, 2006. Further, the Company announced today that its Board of Directors has authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: the purchase of up to 239,096 shares of the Company's common stock in connection with anticipated awards of restricted stock under the Company's 2006 Stock Incentive Plan, approved by stockholders at their Annual Meeting on May 11, 2006. The purchases will be effected through open market transactions or negotiated block transactions, at the discretion of management. The exact timing of the purchases will depend on market conditions and other factors, such as Company-imposed blackout periods Blackout Period 1. A term that refers to a temporary period in which access is limited or denied. 2. A period of around 60 days during which employees of a company with a retirement or investment plan cannot modify their plans. . Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs R. Venables Venables is a village and commune of the Eure département in Haute-Normandie, France. The village dates back some 7,000 years. It is situated at the northern most point of the Madrie Plateau and is located at an altitude of 124 meters above sea level. , President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , noted: "As we reflect on our first full year as a public company, we are encouraged by the progress we've we've Contraction of we have. we've have made, and in particular by the steady growth in our commercial business lines. Although the current environment continues to challenge all of us, we remain focused on expanding our retail and commercial presence in our market area." In the first six months of 2006, the Company's balance sheet increased by $29.8 million, or 3.4%, to $896.8 million. Asset growth was focused primarily in loans, which increased by $19.0 million or 3.1% during the six month period. Smaller increases occurred in short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments, which rose by $4.2 million or 35.1%, and in securities , which rose by $2.4 million or 1.8%. Asset growth was funded by increases in deposit balances aggregating $17.8 million or 2.9%, and in borrowed funds, which increased by $9.6 million or 6.9% in the first six months of 2006. Growth in time deposit accounts, which increased by $15.9 million or 6.0% in the six month period ended June 30, 2006, caused most of the increase in total deposits. Also increasing during this six month period were NOW accounts (up $2.7 million), money market accounts (up $2.2 million), demand deposits (up $1.5 million), offset by a $4.4 million, or 4.5% decrease in savings accounts Savings Account A deposit account intended for funds that are expected to stay in for the short term. A savings account offers lower returns than the market rates. Notes: . With increases in short-term market interest rates, customers have increasingly shown a preference for short-term time deposits and other higher-yielding core accounts, rather than savings deposits Savings deposits Accounts that pay interest, typically at below-market interest rates, that do not have a specific maturity, and that usually can be withdrawn upon demand. . The increase in loans during the first six months of 2006 was principally the result of growth in the Bank's commercial loan portfolio, as commercial real estate loans increased by $14.9 million or 7.1% and commercial business loans increased by $1.3 million or 6.6%, offset by a decline in construction loans outstanding of $5.1 million or 8.5%. While the Company continues to emphasize commercial lending generally, its construction lending for residential development projects has declined over the past six months, as demand has slackened due to an increase in inventory of unsold residential units in the Bank's market area. Residential mortgage and consumer loans also increased during the period, rising by $4.2 million (1.5%) and $3.7 million (10.6%), respectively. Non-performing assets as a percentage of total assets remained low, at 0.01% as of June 30, 2006. The allowance for loan losses as a percent of total loans was essentially unchanged at .92% as of June 30, 2006, compared to 0.91% of total loans at June 30, 2005. The Company's net interest margin ("NIM nim 1 tr. & intr.v. nimmed, nim·ming, nims Archaic To steal; pilfer. [Middle English nimen, to take, from Old English niman; see ") was 3.06% for the three months ended June 30, 2006, a decrease of 20 basis points compared to the second quarter of 2005. The FHLBB FHLBB abbr. Federal Home Loan Bank Board deferred the declaration of its quarterly stock dividend, due to a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. change in its dividend schedule, causing approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 5 basis points of the decline in the Company's NIM for the quarter. The remainder of the reduction in the NIM is due to increases in funding costs, which have outpaced increases in yields earned on loans and securities over the past year. In particular, increases in rates paid on interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid deposits have risen by 101 basis points compared to the second quarter of 2005, as customers have indicated a clear preference for high-yield Adj. 1. high-yield - yielding a large amount of agricultural or industrial production fruitful - productive or conducive to producing in abundance; "be fruitful and multiply" money market accounts and short-term time deposits. The increase in short-term market interest rates and intense competitive pressure in the Bank's market area has driven up interest rates on these products significantly over the past twelve months. Adjusted for the negative effect of the omission omission n. 1) failure to perform an act agreed to, where there is a duty to an individual or the public to act (including omitting to take care) or is required by law. Such an omission may give rise to a lawsuit in the same way as a negligent or improper act. of the FHLBB stock dividend (estimated at $97,000, the amount earned in the first quarter of 2006), net interest income in the second quarter of 2006 was little changed from the amount earned in the comparable 2005 quarter. The unfavorable effect of the decrease in the NIM was offset nearly entirely by growth in earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin , which rose by $31.2 million to $776.2 million on average, compared to an average of $745.0 million in the second quarter of 2005. The loan loss provision for the second quarter of 2006 was $122,000, a significant reduction from the $328,000 provided in the comparable 2005 quarter. The provision recorded in each quarter is primarily reflective Refers to light hitting an opaque surface such as a printed page or mirror and bouncing back. See reflective media and reflective LCD. of the net growth in new loans during the quarter, offset by the effect of any recoveries. Non-interest income for the quarter totaled $1.5 million, an increase of $317,000 or 25.1% compared to the second quarter of 2005, after adjusting both periods for the effect of non-recurring write-downs of bank-owned assets. Most of this growth is attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to a $213,000 or 41.8% increase in fee revenue generated by CSSI CSSI Critical Skills Shortage Initiative CSSI California Strategic Sourcing Initiative CSSI Computer Support Services, Inc. (Irving, TX, USA) CSSI Computer Security Subsystem Interpretation CSSI Computer Software & Services Industry , the Bank's ATM servicing subsidiary. The Company's adjusted efficiency ratio for the quarter (excluding amortization of the core deposit intangible and gains/losses on sales of bank assets) stood at 68.4% compared to 62.7% in the year earlier period, as 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. have increased in order to support the Company's lending growth and public company status. Without those non-GAAP adjustments, the efficiency ratio based on GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). numbers for the quarter was 71.7% versus 145.1% for the comparable quarter in 2005. For a reconciliation, see the table at the end of this release. The scheduled opening of a new branch in Wellesley Wellesley, town (1990 pop. 26,615), Norfolk co., E Mass., a residential suburb SW of Boston; settled 1660, inc. 1881. Its many educational institutions include several private preparatory schools, Babson College, and Wellesley College. , MA in the third quarter of 2006 and the projected opening of a branch in Watertown Watertown. 1 Town (1990 pop. 20,456), Litchfield co., W Conn.; set off from Waterbury and inc. 1780. Synthetic textiles, thread, plastics, chemicals, mattresses, and brass goods are among its manufactures. , MA in early 2007 (subject to receipt of all required local approvals), will serve to increase operating expenses in the near-term near-term adj. Of, for, or involving a short period of time in the near future. . Also, the granting of restricted stock and stock options under the stock-based incentive plan will increase the Company's compensation costs in the periods in which such awards and options vest. The Company anticipates that those costs will begin to be realized in the third quarter of 2006. Certain statements herein constitute "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. " and actual results may differ from those contemplated by these statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional Subject to change; dependent upon or granted based on the occurrence of a future, uncertain event. A conditional payment is the payment of a debt or obligation contingent upon the performance of a certain specified act. verbs such as "will," "would," "should," "could" or "may." Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, legislative and regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. changes that adversely affect the businesses in which Benjamin Franklin Bancorp is engaged and changes in the securities market. The Company disclaims any intent or obligation to update any forward-looking statements, whether in response to new information, future events or otherwise.
BENJAMIN FRANKLIN BANCORP, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
June December
30, 31,
2006 2005
--------------- ---------
ASSETS (Unaudited)
Cash and due from banks $15,571 $16,499
Cash supplied to ATM customers 40,121 37,200
Short-term investments 16,278 12,051
--------------- ---------
Total cash and cash equivalents 71,970 65,750
Securities available for sale, at fair value 124,331 122,379
Securities held to maturity, at amortized
cost 60 109
Restricted equity securities, at cost 10,480 10,012
--------------- ---------
Total securities 134,871 132,500
Loans
Residential real estate 290,452 286,204
Commercial real estate 223,944 209,009
Construction 55,263 60,399
Commercial business 20,426 19,162
Consumer 38,514 34,814
Net deferred loans costs 1,157 1,214
--------------- ---------
Total loans, gross 629,756 610,802
Allowance for loan losses (5,797) (5,670)
--------------- ---------
Loans, net 623,959 605,132
Premises and equipment, net 11,147 11,167
Accrued interest receivable 3,178 3,045
Bank-owned life insurance 10,238 7,451
Goodwill 33,763 33,763
Identifiable intangible asset 3,555 4,133
Other assets 4,154 4,116
--------------- ---------
$896,835 $867,057
=============== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Regular savings $93,547 $97,960
Money market accounts 96,523 94,347
Now accounts 34,830 32,147
Demand deposit accounts 125,887 124,396
Time deposit accounts 278,711 262,823
--------------- ---------
Total deposits 629,498 611,673
Short-term borrowings 15,000 -
Long-term debt 134,954 140,339
Other liabilities 8,118 6,933
--------------- ---------
Total liabilities 787,570 758,945
--------------- ---------
Common stock, no par value; 75,000,000
shares authorized; 8,488,898 shares
issued and outstanding - -
Additional paid-in capital 82,866 82,849
Retained earnings 34,962 32,942
Unearned compensation (5,261) (5,353)
Accumulated other comprehensive loss (3,302) (2,326)
--------------- ---------
Total stockholders' equity 109,265 108,112
--------------- ---------
$896,835 $867,057
=============== =========
BENJAMIN FRANKLIN BANCORP, INC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share and share data)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -------------------
2006 2005 2006 2005
---------- ------- --------- ---------
(Unaudited)
Interest and dividend income:
Loans, including fees $9,236 $8,048 $18,078 $12,940
Debt securities 1,377 893 2,639 1,554
Dividends 23 94 143 162
Short-term investments 186 151 402 244
---------- -------- ---------- --------
Total interest and
dividend income 10,822 9,186 21,262 14,900
Interest expense:
Interest on deposits 3,535 2,193 6,637 3,424
Interest on borrowings 1,373 935 2,799 1,789
---------- -------- ---------- --------
Total interest expense 4,908 3,128 9,436 5,213
---------- -------- ---------- --------
Net interest income 5,914 6,058 11,826 9,687
Provision for loan losses 122 328 128 496
---------- -------- ---------- --------
Net interest income, after
provision for loan losses 5,792 5,730 11,698 9,191
---------- -------- ---------- --------
Other income:
ATM servicing fees 722 509 1,334 509
Deposit service fees 341 298 670 504
Loan servicing fees 155 132 276 204
Investment sales commissions 30 89 97 146
Gain on sale of loans, net 73 4 138 20
Security impairment writedown (35) - (35) -
Loss on sale/write-down of
bank-owned land, net - (1,020) - (1,020)
Income from bank-owned
life insurance 85 59 150 118
Miscellaneous 176 174 315 256
---------- -------- ---------- --------
Total other income 1,547 245 2,945 737
---------- -------- ---------- --------
Operating expenses:
Salaries and employee
benefits 2,725 2,466 5,446 4,480
Occupancy and equipment 642 658 1,308 1,099
Data processing 452 535 900 872
Professional fees 355 238 733 367
Marketing and advertising 148 117 311 273
Contribution to Benjamin
Franklin Bank Charitable
Foundation - 4,000 - 4,000
Amortization of core
deposit intangible 277 554 578 599
Other general and
administrative 756 574 1,398 916
---------- -------- ---------- --------
Total operating expenses 5,355 9,142 10,674 12,606
---------- -------- ---------- --------
Income (loss) before income
taxes 1,984 (3,167) 3,969 (2,678)
Provision (benefit) for income
taxes 724 (625) 1,441 (466)
---------- -------- ---------- --------
Net income (loss) $1,260 $(2,542) $2,528 $(2,212)
========== ======== ========== ========
Weighted-average shares
outstanding:
Basic 8,030,629 N/A 8,028,636 N/A
Diluted 8,030,629 N/A 8,028,636 N/A
Earnings per share:
Basic $0.16 N/A $0.32 N/A
Diluted $0.16 N/A $0.32 N/A
BENJAMIN FRANKLIN BANCORP, INC. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS AND OTHER DATA
(In thousands, except per share data) (Unaudited)
At or For At or For
the Three Months the Six Months
Ended June 30, Ended June 30,
--------------------- --------------------
2006 2005 2006 2005
---------- ---------- ---------- ---------
Financial Highlights:
Net interest income $5,914 $6,058 $11,826 $9,687
Net income (loss) $1,260 $(2,542) $2,528 $(2,212)
Shares outstanding - end of
period 8,034,614 n/a 8,034,614 n/a
Weighted average shares
outstanding:
Basic 8,030,629 n/a 8,028,636 n/a
Diluted 8,030,629 n/a 8,028,636 n/a
Shareholders' equity $109,265 $109,229
Book value per share $13.60 $13.33
Tangible book value per
share $8.96 $8.61
Ratios and Other
Information:
Return on average assets 0.57% -1.20% 0.58% -0.64%
Return on average equity 4.64% -9.67% 4.69% -6.50%
Average interest rate
spread (1) 2.49% 2.89% 2.54% 2.75%
Net interest margin (2) 3.06% 3.26% 3.10% 3.15%
Efficiency ratio (3) 68.41% 62.69% 68.83% 70.08%
Non-interest expense to
average total assets (4) 2.42% 4.31% 2.43% 3.68%
Average interest-earning
assets to average
interest-bearing
liabilities 120.66% 122.56% 120.44% 123.40%
At period end:
Non-performing assets to
total assets 0.01% 0.04%
Non-performing loans to
total loans 0.02% 0.06%
Allowance for loan losses to
non-performing loans 4354.94% 1592.13%
Allowance for loan losses to
total loans 0.92% 0.91%
Equity to total assets 12.18% 12.62%
Tier 1 leverage capital
ratio 9.89% 9.96%
Total risk-based capital
ratio 15.05% 15.34%
Number of full service
offices 9 9
-------------------------------------------------------------
(1) The average interest rate spread represents the difference between
the weighted-average yield on interest-earning assets and the
weighted-average cost of interest-bearing liabilities for the
period.
(2) The net interest margin represents net interest income as a
percent on average interest-earning assets for the period.
(3) The efficiency ratio represents non-interest expense minus
expenses related to the amortization of intangible assets and (in
2005) the contribution to the Benjamin Franklin Bank Charitable
Foundation, divided by the sum of net interest income (before the
loan loss provision) plus non-interest income (excluding net gains
(losses) on sale of bank assets). Without those non-GAAP
adjustments the efficiency ratio based on GAAP numbers for the
periods shown were 71.77%, 145.05%, 72.26% and 120.93%,
respectively. For a reconciliation, see the table at the end of
this release.
(4) For the three and six-month 2005 periods, if the Charitable
Foundation contribution were excluded, the ratio of non-interest
expense to average total assets would have been 2.42% and 2.51%,
respectively.
BENJAMIN FRANKLIN BANCORP, INC AND SUBSIDIARIES
ANALYSIS OF NET INTEREST INCOME
(Dollars in thousands)
(Unaudited)
Three Months Ended June 30,
----------------------------------------
2006
----------------------------------------
Average
Outstanding
Balance Interest Yield/Rate(1)
------------ -------- -------------
Interest-earning assets:
Loans $620,986 $9,236 5.91%
Securities 139,739 1,400 3.94%
Short-term investments $15,504 186 4.75%
----------- -------- -------------
Total interest-earning assets 776,229 10,822 5.54%
Non-interest-earning assets 113,054
-----------
Total assets $889,283
===========
Interest-bearing liabilities:
Savings deposits $94,810 121 0.51%
Money market 116,061 716 2.47%
NOW accounts 28,250 10 0.15%
Certificates of deposits 277,996 2,688 3.88%
----------- -------- -------------
Total deposits 517,117 3,535 2.74%
Borrowings 126,214 1,373 4.30%
----------- -------- -------------
Total interest-bearing
liabilities 643,331 4,908 3.05%
Non-interest bearing liabilities 136,999
-----------
Total liabilities 780,330
Equity 108,953
-----------
Total liabilities and equity $889,283
===========
Net interest income $5,914
========
Net interest rate spread (2) 2.49%
Net interest-earning assets (3) $132,898
===========
Net interest margin (4) 3.06%
Average interest-earning assets to
interest-bearing liabilities 120.66%
Three Months Ended June 30,
----------------------------------------
2005
----------------------------------------
Average
Outstanding
Balance Interest Yield/Rate(1)
----------- -------- -------------
Interest-earning assets:
Loans $589,869 $8,048 5.47%
Securities 128,698 987 3.08%
Short-term investments 26,429 151 2.29%
----------- -------- -------------
Total interest-earning assets 744,996 9,186 4.95%
Non-interest-earning assets 106,428
-----------
Total assets $851,424
===========
Interest-bearing liabilities:
Savings deposits $109,318 142 0.52%
Money market 117,969 458 1.56%
NOW accounts 36,240 32 0.35%
Certificates of deposits 244,490 1,561 2.56%
----------- -------- -------------
Total deposits 508,017 2,193 1.73%
Borrowings 99,857 935 3.76%
----------- -------- -------------
Total interest-bearing
liabilities 607,874 3,128 2.06%
Non-interest bearing liabilities 138,073
-----------
Total liabilities 745,947
Equity 105,477
-----------
Total liabilities and equity $851,424
===========
Net interest income $6,058
========
Net interest rate spread (2) 2.89%
Net interest-earning assets (3) $137,122
===========
Net interest margin (4) 3.26%
Average interest-earning assets to
interest-bearing liabilities 122.56%
(1) Yields and rates for the three months ended June 30, 2006 and 2005
are annualized.
(2) Net interest rate spread represents the difference between the
yield on average interest-earning assets and the cost of average
interest-bearing liabilities
(3) Net interest-earning assets represents total interest- earning
assets less total interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by
average total interest-earning assets.
BENJAMIN FRANKLIN BANCORP, INC AND SUBSIDIARIES
ANALYSIS OF NET INTEREST
INCOME
(Dollars in thousands)
(Unaudited)
Six Months Ended June 30,
-----------------------------------
2006
-----------------------------------
Average
Outstanding
Balance Interest Yield/Rate(1)
------------ -------- -------------
Interest-earning assets:
Loans $613,788 $18,078 5.88%
Investment securities 138,280 2,782 4.03%
Short-term investments $17,589 402 4.55%
----------- -------- -------------
Total interest-earning assets 769,657 21,262 5.51%
Non-interest-earning assets 114,487
-----------
Total assets $884,144
===========
Interest-bearing liabilities:
Savings deposits $95,712 239 0.50%
Money market 107,372 1,226 2.30%
NOW accounts 27,706 20 0.15%
Certificates of deposits 276,957 5,152 3.75%
----------- -------- -------------
Total deposits 507,747 6,637 2.64%
Borrowings 131,314 2,799 4.24%
----------- -------- -------------
Total interest-bearing
liabilities 639,061 9,436 2.97%
Non-interest bearing liabilities 136,372
-----------
Total liabilities 775,433
Equity 108,711
-----------
Total liabilities and equity $884,144
===========
Net interest income $11,826
========
Net interest rate spread (2) 2.54%
Net interest-earning assets (3) $130,596
===========
Net interest margin (4) 3.10%
Average interest-earning assets to
interest-bearing liabilities 120.44%
Six Months Ended June 30,
-----------------------------------
2005
-----------------------------------
Average
Outstanding
Balance Interest Yield/Rate(1)
----------- -------- -------------
Interest-earning assets:
Loans $489,108 $12,940 5.34%
Investment securities 110,167 1,716 3.14%
Short-term investments 21,272 244 2.31%
----------- -------- -------------
Total interest-earning assets 620,547 14,900 4.84%
Non-interest-earning assets 71,073
-----------
Total assets $691,620
===========
Interest-bearing liabilities:
Savings deposits $102,177 258 0.51%
Money market 87,618 668 1.54%
NOW accounts 29,161 40 0.28%
Certificates of deposits 193,450 2,458 2.56%
----------- -------- -------------
Total deposits 412,406 3,424 1.67%
Borrowings 90,485 1,789 3.99%
----------- -------- -------------
Total interest-bearing
liabilities 502,891 5,213 2.09%
Non-interest bearing liabilities 120,171
-----------
Total liabilities 623,062
Equity 68,558
-----------
Total liabilities and equity $691,620
===========
Net interest income $9,687
========
Net interest rate spread (2) 2.75%
Net interest-earning assets (3) $117,656
===========
Net interest margin (4) 3.15%
Average interest-earning assets to
interest-bearing liabilities 123.40%
(1) Yields and rates for the six months ended June 30, 2006 and 2005
are annualized.
(2) Net interest rate spread represents the difference between the
yield on average interest-earning assets and the cost of average
interest-bearing liabilities
(3) Net interest-earning assets represents total interest-earning
assets less total interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by
average total interest-earning assets.
Reconciliation of Non-GAAP Financial Measures This press release contains financial information determined by methods other than in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with accounting principles generally accepted in the United States of America UNITED STATES OF AMERICA. The name of this country. The United States, now thirty-one in number, are Alabama, Arkansas, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, New Hampshire, ("GAAP"). The Company's management uses these non-GAAP measures in its analysis of the Company's performance. These measures typically adjust GAAP performance measures to exclude significant gains or losses that are expected to be non-recurring and to exclude the effects of amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. (in the case of the efficiency ratio). Because these items and their impact on the Company's performance are difficult to predict, management believes that presentations of financial measures excluding the impact of these items provide useful supplemental information that is essential to a proper understanding of the operating results of the Company's core businesses. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Three months Six months ended
ended June 30, June 30,
2006 2005 2006 2005
------- -------- ------- --------
Efficiency ratio based on GAAP
numbers 71.77 % 145.05 % 72.26 % 120.93 %
Effects of amortization of
intangible assets (3.73) (7.57) (3.94) (5.24)
Effects of contribution to the
Benjamin Franklin Bank Charitable
Foundation - (54.66) - (35.01)
Effects of net gain/(loss/write-
down) on sale of bank assets .37 (20.13) .51 (10.59)
------- -------- ------- --------
Efficiency ratio - Reported 68.41 % 62.69 % 68.83 % 70.09 %
======= ======== ======= ========
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