Business Bancorp Announces Revenues Grow 19% in 2001; Assets More Than Double Following Merger With MCB Financial.Business Editors SAN RAFAEL San Rafael (săn rəfĕl`), residential city (1990 pop. 48,404), seat of Marin co., W Calif., a suburb of San Francisco on the northern shore of San Francisco Bay; inc. 1913. , Calif.--(BUSINESS WIRE)--Feb. 14, 2002 Business Bancorp (NasdaqNM:BZBC), the parent company of Business Bank of California The Bank of California was founded in San Francisco, California on July 5, 1864 by William Chapman Ralston. It was the first commercial bank in the Western United States, the second-richest bank in the nation, and considered instrumental in developing the American Old West. (www.businessbank.com), today reported strong revenue growth and a 102% increase in assets following the merger of equals with MCB (Memory Control Block) An identifier (16 bytes) that DOS places in front of each block of memory it allocates. Financial. Revenues increased 19% to $20.4 million and profits grew 10% to $2.5 million or $1.20 per 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. share for the year. Business Bancorp, with assets of $630 million, serves the needs of mid-market businesses through its 16 branches in Northern and Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, . Because the merger was completed at the end of the year and was accounted for as a purchase transaction, the income statement excludes MCB Financial's operating results and reflects only BZBC's 2001 operating profits Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. , whereas the balance sheet reflects the newly combined bank at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. . Merger Update Announced in August 2001, Business Bancorp and MCB Financial's merger was completed on December December: see month. 31, 2001, uniting two of California's business banks and creating a platform for future growth. "Our goal is to build a first-class, state-wide, middle-market The term middle-market may refer to either a type of newspaper or a type of company. A middle-market newspaper is one that attempts to cater to readers who want some entertainment value from their newspaper as well as adequate serious coverage of significant news business bank, starting with the solid foundation of our two organizations," said Alan A`lan´ n. 1. A wolfhound. J. Lane, Chief Executive Officer. "Once we have fully-integrated our operations, we will have the critical mass, in terms of size and scale, to acquire emerging business banks in California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). and further build our franchise." "With the merger accomplished on-time, we are now working on the integration of the two banks focusing on propagating the best practices of each entity," said Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by O. Hall, President. "To that end, we've we've Contraction of we have. we've have hired Sheshunoff to work with us to develop and implement our data-processing conversion, cultural integration and business process optimization Process optimization is the practice of making changes or adjustments to a process, to get results. Optimization is the use of specific techniques to determine the most cost effective and efficient solution to a problem or design for a process. . We anticipate the data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a and systems conversions will be complete within the next three months, and expect to begin seeing the cost benefits of full integration during the fourth quarter. "Our goals for 2002 are to generate growth in earnings per share of 11% to 17%, expand our deposit base 5% to 10%, increase our loan portfolio by 10% or more, drive ROAE ROAE Return on Average Equity above 10% and ROAA ROAA Return on Average Assets (business, banking, accounting) ROAA Rural Oregon Arts Association ROAA Royce Online Account Access (Royce Fund Services, Inc. above 0.85%, while maintaining solid asset quality measured by a ratio of non-performing assets (NPA (1) (Numbering Plan Area) The Bellcore/Telcordia telephone area code system in use in the U.S., Canada, Alaska, Hawaii and islands in the Caribbean. See NPA code. (2) (Network Professional Association, San Diego, CA, www.npanet. ) to total assets of 0.50% or better, with net charge-offs of between 10 and 15 basis points," commented Patrick E. Phelan Phelan may refer to:
Balance Sheet Highlights (at December 31, 2001 compared to December 31, 2000) The merger, combined with solid year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. internal growth, effectively doubled Business Bancorp's balance sheet. Assets grew 102% to $630 million, compared to $312 million a year ago. Gross loans increased 117% to $391 million with commercial real estate loans increasing 162% to $221 million, or 57% of the portfolio. Commercial loans increased 78% to $70 million, or 18% of the portfolio, and real estate construction lending increased 96% to $67 million, or 17% of the portfolio. Asset quality remained strong with total non-performing loans A non-performing loan is a loan that is in default or close to being in default. Many loans become non-performing after being in default for 3 months, but this can depend on the contract terms. of $2.0 million, or 0.50% of total loans at year-end, compared to $1.0 million or 0.55% of total loans a year ago. NPA/assets was 0.32% at year-end compared to 0.48% a year ago. The bank's allowance for loan losses increased 147% to $4.6 million, or 1.17% of total loans, compared to $1.8 million or 1.02% of total loans a year earlier. During the first nine months of 2001 the bank charged-off a total of $57,000 and posted a net recovery of $110,000 in the fourth quarter, resulting in a net recovery of $53,000 for the full year. Deposits almost doubled following the merger, increasing 96% to $518 million from $265 million a year ago. Non-interest bearing deposits increased 107% to $197 million, or 38% of total deposits, compared to $95 million, or 36% of total deposits at the end of 2000. Shareholder equity grew 132% to $55 million, or $13.96 per share. Tangible Possessing a physical form that can be touched or felt. Tangible refers to that which can be seen, weighed, measured, or apprehended by the senses. A tangible object is something that is real and substantial. An automobile is an example of tangible Personal Property. book value at year-end was $9.24 per share. In February February: see month. , the company repurchased 85,167 shares from dissenting dis·sent intr.v. dis·sent·ed, dis·sent·ing, dis·sents 1. To differ in opinion or feeling; disagree. 2. To withhold assent or approval. n. 1. shareholders for a total of $1.2 million based on the merger agreement detailed in the offering memorandum Offering Memorandum A legal document stating the objectives, risks, and terms of investment involved with a private placement. Notes: The private placement of hedge funds necessitates the issue of memorandums. . The net effect of this transaction reduces tangible book value by approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $0.12 per share. Operating Highlights Under generally accepted accounting procedures (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), the bank only reports the results of the Business Bancorp operations in 2001. The following tables are for informational purposes only and reflect the operating highlights of the two banks during 2001 on a stand-alone (jargon) stand-alone - Capable of operating without other programs, libraries, computers, hardware, networks, etc. Exactly what is absent is presumed to be obvious from context. "We only run Windows on stand-alone PCs because it's too dangerous to run it on networked ones." basis, along with the blended blend v. blend·ed or blent , blend·ing, blends v.tr. 1. To combine or mix so that the constituent parts are indistinguishable from one another: results of both banks.
2001 Operating Highlights
($ in thousands, except
share and per MCB Pro Merger-
share amounts) BZBC Forma Core Related Blended
(unaudited) GAAP Results (a) Adjustment Pro Forma
Interest income $ 25,095 $ 17,699 $ - $ 42,794
Interest expense 8,510 5,309 - 13,819
----------------------------------------------------
----------------------------------------------------
Net interest
income 16,585 12,390 - 28,975
Provision for
loan losses 225 500 - 725
----------------------------------------------------
----------------------------------------------------
Net interest
income after
provision
for loan
losses 16,360 11,890 - 28,250
Other Income:
Service fees on
deposit accounts 2,507 543 - 3,050
Gain on sale of
SBA loans 40 81 - 121
Gain on sale of
other real
estate owned 53 - - 53
Gain / (loss) on
sales of
investments 817 228 - 1,045
Other 653 307 - 960
----------------------------------------------------
----------------------------------------------------
Total other
income 4,070 1,159 - 5,229
Other Expenses:
Salaries and
employee
benefits 8,481 4,601 - 13,082
Occupancy 1,072 1,067 - 2,139
Other 6,975 2,270 9,666
----------------------------------------------------
----------------------------------------------------
Total other
expenses 16,528 7,938 421 24,887
Income before
income taxes 3,902 5,111 (421) 8,593
Income tax
expense 1,395 2,096 - 3,328
----------------------------------------------------
----------------------------------------------------
Net income $ 2,507 $ 3,015 $ (421) $ 5,265
====================================================
====================================================
PER SHARE DATA:
Net income per
share
Basic $ 1.24 $ 1.83 $ 1.33
Diluted $ 1.20 $ 1.74 $ 1.27
====================================================
====================================================
Basic weighted
average common
shares 2,029,109 1,647,933 290,531 3,967,573
Diluted weighted
average common
shares 2,093,895 1,734,196 305,739 4,133,830
(a) excluding nonrecurring gains on sale of investment securities
and merger related expenses
2001 Operating
Highlights MCB Pro Merger-
($ in thousands) BZBC Forma Core Related Blended
(unaudited) GAAP Results (a) Adjustment Pro Forma
SELECTED RATIOS:
Return on average
assets 0.72% 1.35% 0.90%
Return on average
equity 9.90% 21.00% 9.79%
Net interest
margin 5.49% 6.00% 5.66%
Efficiency ratio 80.02% 58.59% 72.76%
Efficiency ratio
excluding trust
preferred
securities
expense 76.83% 57.24% 70.34%
AVERAGE BALANCES:
Average
investments $ 124,207 $ 37,663 $ 161,870
Average loans, net $ 188,636 $ 168,820 $ 2,919 $ 360,375
Average interest
earning assets $ 312,843 $ 206,483 $ 2,919 $ 522,245
Average assets $ 349,344 $ 224,140 $ 14,277 $ 587,761
Average deposits $ 287,363 $ 204,249 $ 179 $ 491,791
Average interest
bearing
liabilities $ 217,755 $ 153,813 $ 179 $ 371,747
Average equity $ 25,315 $ 14,357 $ 14,098 $ 53,770
About Business Bancorp Business Bancorp is a bank holding company that owns 100% of the capital stock of Business Bank of California, the company's principal operating subsidiary An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. . The bank is a California state chartered Fed member commercial bank whose primary business includes retail banking, commercial, construction, and SBA SBA abbr. Small Business Administration Noun 1. SBA - an independent agency of the United States government that protects the interests of small businesses and ensures that they receive a fair share of government lending activities. Business Bank of California has served California businesses since 1984. The bank operates 16 branches in the Southern California cities of Corona Corona, city, United States Corona (kərō`nə), city (1990 pop. 76,095), Riverside co., S Calif.; inc. 1896. The city developed as a primary citrus fruit producer and shipping center. There is also light manufacturing. , Hemet Hemet (hĕm`ĭt), city (1990 pop. 36,094), Riverside co., S Calif., in the San Jacinto valley; inc. 1910. Hemet and the surrounding area saw extensive growth in the 1970s and 80s, due to increased local agribusiness and the development of the , Hesperia Hesperia may refer to:
Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. , Phelan, Riverside Riverside. 1 City (1990 pop. 226,505), seat of Riverside co., S Calif.; inc. 1883. One of the fastest growing U.S. cities in the late 20th cent., it is famous for its orange industry. , Redlands Redlands, city (1990 pop. 60,394), San Bernardino co., S Calif., in the San Bernardino Valley; inc. 1888. Industries include software research and development and the manufacture of metal foil, furniture, and electrical equipment. , Upland Upland, city (1990 pop. 63,374), San Bernardino co., S Calif., in a citrus-fruit region at the foot of the San Gabriel Mts.; inc. 1906. Citrus fruits and grapes are packed and processed in the city. Paint, orchard heaters, auto parts, and feed products are also made. and San Bernardino San Bernardino, city, United States San Bernardino (săn bûr'nədē`nō), city (1990 pop. 164,164), seat of San Bernardino co., S Calif., at the foot of the San Bernardino Mts.; inc. 1854. , and in the Northern California Northern California, sometimes referred to as NorCal, is the northern portion of the U.S. state of California. The region contains the San Francisco Bay Area, the state capital, Sacramento; as well as the substantial natural beauty of the redwood forests, the northern cities of San Rafael, Petaluma Petaluma (pĕtəl  `mə), city (1990 pop. 43,184), Sonoma co., W Calif.; inc. 1858. , San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden , South San Francisco South San Francisco, city (1990 pop. 54,312), San Mateo co., W Calif.; inc. 1908. South San Francisco has several industrial parks; its manufactures include medical supplies and equipment, foods, paint, paper products, consumer goods, and clothing. , and Hayward Hayward, city (1990 pop. 111,498), Alameda co., W Calif.; settled 1851, inc. 1876. It is an important commercial and distribution center for farm products. Manufactures include wire, plastics, metal and paper products, textiles, machinery, and motor vehicles. . They are
strongly focused on providing high quality, personalized per·son·al·ize tr.v. per·son·al·ized, per·son·al·iz·ing, per·son·al·iz·es 1. To take (a general remark or characterization) in a personal manner. 2. To attribute human or personal qualities to; personify. services to small businesses, professionals and consumers. For information on the company or to obtain the company's quarterly financial supplement, call Patrick E. Phelan, CFO See Chief Financial Officer. at 415-784-2328 or e-mail your request to pphelan@mcbf.com Include your phone, facsimile, e-mail and mailing address. The statements contained in this release that are not historical facts are 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. based on management's current expectations and beliefs concerning future developments and their potential effects on the company. There can be no assurance that future developments affecting the company will be those anticipated by management. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve risks and uncertainties, including the bank's ability to implement its plans to efficiently integrate its operations with those of MCB Financial, the impact of current events on the California economy, changes in interest rates and other factors detailed in the company's SEC filings.
CONSOLIDATED BALANCE SHEET
($ in thousands,
except per share
data) Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(unaudited) 2001 2001 2001 2001 2000
--------------------------------------------------
Assets:
Cash and due from
banks $ 34,665 $ 22,868 $ 24,445 $ 25,150 $ 20,285
Investments 173,040 129,442 115,924 106,912 93,340
Loans:
Real estate -
construction 66,812 34,818 33,272 39,192 34,044
Commercial
real estate 220,925 98,233 87,983 88,398 84,073
Real estate -
other 19,280 14,458 15,065 14,063 14,651
Commercial 70,104 39,599 38,724 36,943 39,358
Consumer and
other 14,578 8,793 9,103 8,492 9,311
Deferred loan
fees, net (1,109) (915) (1,039) (1,159) (1,069)
Total loans 390,590 194,986 183,108 185,929 180,368
Allowance for
loan losses (4,557) (1,986) (1,973) (1,910) (1,843)
Total loans,
net 386,033 193,000 181,135 184,019 178,525
Goodwill and other
intangible assets 18,463 7,106 7,276 7,441 7,546
Other assets 18,238 12,193 11,333 11,480 11,845
--------------------------------------------------
--------------------------------------------------
Total assets $ 630,439 $ 364,609 $ 340,113 $ 335,002 $ 311,541
==================================================
Liabilities and
Stockholders'
Equity:
Liabilities:
Deposits:
Noninterest-
bearing $ 197,084 $ 103,489 $ 100,410 $ 98,549 $ 95,435
NOW, MMDA and
Savings 201,456 107,902 102,549 103,043 102,886
Time
certificates,
$100,000 and
over 76,682 49,158 45,024 43,001 35,792
Other time
certificates 42,864 35,449 34,234 32,960 30,814
Total
deposits 518,086 295,998 282,217 277,553 264,927
Other borrowings 40,224 29,825 19,825 19,825 10,125
Other liabilities 4,572 2,541 2,641 2,861 2,946
--------------------------------------------------
Total
liabilities 562,882 328,364 304,683 300,239 277,998
Trust preferred
securities 13,000 10,000 10,000 10,000 10,000
Stockholders'
equity 54,557 26,245 25,430 24,763 23,543
--------------------------------------------------
Total liabilities
and stockholders'
equity $ 630,439 $ 364,609 $ 340,113 $ 335,002 $ 311,541
==================================================
CREDIT QUALITY DATA:
Non-accrual loans 1,947 1,752 1,778 999 999
Loans 90 days or
more past due and
still accruing 18 108 0 0 0
Total
nonperforming
loans 1,965 1,860 1,778 999 999
Other real estate
owned 73 313 313 500 505
Total
nonperforming
assets 2,038 2,173 2,091 1,499 1,504
Nonperforming loans
as a percentage of
total loans 0.50% 0.95% 0.97% 0.54% 0.55%
Nonperforming
assets as a
percentage of
total assets 0.32% 0.60% 0.61% 0.45% 0.48%
Allowance for loan
losses as a
percentage of
total loans 1.17% 1.02% 1.08% 1.03% 1.02%
Quarterly net loan
charge-offs
(recoveries) (110) 12 37 8 1
CAPITAL RATIOS:
Stockholders'
equity as a
percentage of
total assets 8.65% 7.20% 7.48% 7.39% 7.56%
Total risk-based
capital ratio 11.04% 11.70% 12.90% 12.20% 11.80%
Tier 1 risk-based
capital ratio 10.00% 10.20% 11.00% 10.20% 9.70%
Tier 1 leverage
ratio 7.16% 7.40% 7.40% 7.40% 7.80%
OTHER PERIOD END
STATISTICS:
Loan to deposit
ratio 75.39% 65.87% 64.88% 66.99% 68.08%
Non-interest bearing
deposits to total
deposits 38.04% 34.96% 35.58% 35.51% 36.02%
QUARTERLY INCOME
STATEMENT Three Months Ended
($ in thousands,
except per
share data) Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
(unaudited) 2001 2001 2001 2001 2000
--------------------------------------------------
--------------------------------------------------
Interest income $ 6,253 $ 6,079 $ 6,356 $ 6,407 $ 6,287
Interest expense 1,873 2,121 2,222 2,294 2,092
--------------------------------------------------
--------------------------------------------------
Net interest
income 4,380 3,958 4,134 4,113 4,195
Provision for
loan losses 25 25 100 75 125
--------------------------------------------------
--------------------------------------------------
Net interest
income after
provision for
loan losses 4,355 3,933 4,034 4,038 4,070
Other Income:
Service fees on
deposit accounts 692 621 604 590 585
Gain on sale of
SBA loans 40 0 0 0 0
Gain on sale of
other real estate
owned 12 0 41 0 1
Gain / (loss) on
sales of
investments 165 443 105 104 55
Other 211 135 139 168 14
--------------------------------------------------
--------------------------------------------------
Total other
income 1,120 1,199 889 862 655
Other Expenses:
Salaries and
employee benefits 2,276 2,060 2,120 2,025 1,966
Occupancy 320 305 200 247 236
Other 1,895 1,783 1,629 1,668 1,563
--------------------------------------------------
--------------------------------------------------
Total other
expenses 4,491 4,148 3,949 3,940 3,765
--------------------------------------------------
--------------------------------------------------
Income before
income taxes 984 984 974 960 960
Income tax expense 349 353 349 344 350
--------------------------------------------------
--------------------------------------------------
Net income $ 635 $ 631 $ 625 $ 616 $ 610
==================================================
==================================================
PER SHARE DATA:
Net income per share
Basic $ 0.31 $ 0.31 $ 0.31 $ 0.30 $ 0.30
Diluted $ 0.30 $ 0.30 $ 0.30 $ 0.30 $ 0.30
Common dividends
paid per share $ 0.01 $ 0.01 $ - $ - $ -
Book value $ 13.96 $ 12.90 $ 12.55 $ 12.22 $ 11.62
Tangible book value $ 9.24 $ 9.41 $ 8.96 $ 8.55 $ 7.89
Basic weighted
average common
shares 2,034,069 2,028,630 2,026,869 2,026,869 2,026,869
Diluted weighted
average common
shares 2,092,172 2,114,373 2,086,545 2,057,682 2,057,682
Common shares
outstanding at
period end 3,907,439 2,034,069 2,026,869 2,026,869 2,026,869
PROFITABILITY
RATIOS:
Return on average
assets 0.66% 0.72% 0.74% 0.76% 0.79%
Return on
average equity 9.63% 9.69% 9.99% 10.20% 11.09%
Net interest margin 5.21% 5.40% 5.53% 5.86% 6.51%
Efficiency ratio 81.65% 80.43% 78.62% 79.20% 77.63%
Efficiency ratio
excluding interest
on trust
preferred
securities 77.73% 76.42% 74.54% 75.09% 73.42%
ANNUAL INCOME STATEMENT
($ in thousands, except per Year Ended
share data) Dec 31 Dec 31 %
(unaudited) 2001 2000 Change
----------- ----------- ---------
----------- ----------- ---------
Interest income $ 25,095 $ 21,408 17%
Interest expense 8,510 7,027 21%
----------- -----------
----------- -----------
Net interest income 16,585 14,381 15%
Provision for loan losses 225 255 -12%
----------- -----------
----------- -----------
Net interest income after
provision for loan losses 16,360 14,126 16%
Other Income:
Service fees on deposit accounts 2,507 2,146 17%
Gain on sale of SBA loans 40 12 233%
Gain on sale of other real
estate owned 53 198 -73%
Gain / (loss) on sales
of investments 817 43 1800%
Other 653 417 57%
----------- -----------
----------- -----------
Total other income 4,070 2,816 45%
Other Expenses:
Salaries and employee benefits 8,481 6,797 25%
Occupancy 1,072 854 26%
Other 6,975 5,926 18%
----------- -----------
----------- -----------
Total other expenses 16,528 13,577 22%
----------- -----------
----------- -----------
Income before income taxes 3,902 3,365 16%
Income tax expense 1,395 1,095 27%
----------- -----------
----------- -----------
Net income $ 2,507 $ 2,270 10%
=========== ===========
=========== ===========
PER SHARE DATA:
Net income per share
Basic $ 1.24 $ 1.12 10%
Diluted $ 1.20 $ 1.10 9%
Book value $ 13.96 $ 11.62 20%
Tangible book value $ 9.24 $ 7.89 17%
Basic weighted average
common shares 2,029,109 2,026,869
Diluted weighted average
common shares 2,093,895 2,057,682
Common shares outstanding
at period end 3,907,439 2,026,869
PROFITABILITY RATIOS:
Return on average assets 0.72% 0.85%
Return on average equity 9.90% 11.17%
Net interest margin 5.49% 6.29%
Efficiency ratio 80.02% 78.95%
Efficiency ratio excluding
interest on trust preferred
securities 76.83% 75.20%
|
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion