CapitalSouth Bancorp Announces Second Quarter 2006 Results.BIRMINGHAM Birmingham, cities, United States Birmingham (bûr`mĭnghăm') 1 City (1990 pop. 265,968), seat of Jefferson co., N central Ala., in the Jones Valley near the southern end of the Appalachian system; founded and inc. , Ala ALA aminolevulinic acid. Ala alanine. ala (a´lah) pl. a´lae [L.] a winglike process. . -- Please replace the release dated July July: see month. 27, 2006 with the following corrected version due to multiple revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. . E[acute accent acute accent n. A mark (´) indicating: a. that a vowel is close or tense, as é in French été. b. that a vowel or syllable has a high or rising pitch, as in Chinese or Ancient Greek. c. ]The corrected release reads: E[acute accent]CAPITALSOUTH BANCORP ANNOUNCES SECOND QUARTER 2006 RESULTS E[acute accent]CapitalSouth Bancorp ("CapitalSouth") (NASDAQ-GM: CAPB CAPB Curriculum and Assessment Policy Branch ) today announced results for the second quarter of 2006. Total assets at the end of the quarter were $448.4 million, a 23.8% increase over the $362.1 million at the end of the second quarter 2005. Deposits grew 25.5% during the same period, ending the second quarter 2006 at $378.4 million. Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. ended the second quarter at $39.7 million, or $13.39 per share, up $1.71 from June June: see month. 30, 2005. E[acute accent]For the quarter ended June 30, 2006, CapitalSouth reported earnings of $994,000, up 47.9% from the second quarter 2005. During the quarter the Company recognized an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. gain of $666,000 from the sale of its investment in Consumer National Bank in Jackson, Mississippi Jackson is the capital and the most populous city of the U.S. State of Mississippi. It is one of the county seats of Hinds County; Raymond is the other county seat. As of the 2000 census Jackson's population was 184,256. ("CNB CNB Czech National Bank CNB Centro Nacional de Biotecnologia CNB City National Bank CNB Citizens National Bank CNB Croatian National Bank CNB Chloronitrobenzene CNB Corresponsales No Bancarios (Spanish, Colombia) "), in connection with the acquisition of CNB by another bank. Partially offsetting this gain was $170,200 of after-tax expense related to granting employee incentive stock options. For the quarter, diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of increased 10% to $.33 from the $.30 reported for the second quarter 2005. Earnings in the second quarter 2006 resulted in a return on average shareholders' equity (ROE A fictitious surname used for an unknown or anonymous person or for a hypothetical person in an illustration. A lawsuit is generally named for the persons who are parties to it. ) of 10.09% compared to 10.36% in the same quarter of 2005, and a return on average assets (ROA ROA See: Return on assets ROA See: Right of accumulation ROA See return on assets (ROA). ) of .89% compared to .75% for the same quarter of 2005. E[acute accent]During the second quarter 2006, CapitalSouth recorded a loan loss provision of $104,000 and recognized $142,000 in net charge-offs, representing .16% of average total loans for the period compared with .02% for the second quarter of 2005. This increase in net losses was primarily the result of identifying loan losses in one market. Mr. W. Dan Puckett Puckett can refer to:
tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. economy." At June 30, 2006,
nonperforming assets Nonperforming assetAn asset that is not effectively producing income, such as an overdue loan. nonperforming asset An asset that produces no income. remained at .55% of period end loans and other real estate compared to December December: see month. 31, 2005. The allowance for loan losses as a percentage of period end nonperforming loans was 260% at June 30, 2006, up from 229% at December 31, 2005. E[acute accent]"2006 continues to be a year of investment for our Company. I am very pleased with the growth in our new markets," commented Mr. Puckett. "In the second quarter, our newest market, Jacksonville, Florida “Jacksonville” redirects here. For other uses, see Jacksonville (disambiguation). Jacksonville is the largest city in the state of Florida and the county seat of Duval County. , had very strong average asset growth compared to the first quarter. Our Huntsville, Alabama Huntsville is the county seat of Madison County, Alabama. Huntsville is the largest city in northern Alabama in a region of a half-million people, with the city proper having 168,132 residents (2006 estimate). market's average assets grew 21% from the first quarter of 2006, and 148% compared to the second quarter of 2005. We believe our business model is working well in these markets and anticipate continued strong growth as we develop these markets." E[acute accent]CapitalSouth Bancorp is a bank holding company operating nine full service banking offices and two loan production offices through two bank subsidiaries as follows: CapitalSouth Bank with seven full service banking offices in Birmingham and Huntsville Huntsville, town, Canada Huntsville, town (1991 pop. 14,997), SE Ont., Canada, on the Muskoka River. It has lumber mills and a woodworking plant, but it is sustained mainly by its year-round tourist trade. Alabama Alabama, indigenous people of North America Alabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). , and Jacksonville Jacksonville. 1 City (1990 pop. 29,101), Pulaski co., central Ark., inc. 1941. The city has varied industries, including printing and publishing and the manufacture of electronic equipment, ordnance, and plastic and metal products. Florida Florida, state, United States Florida (flôr`ĭdə, flŏr`–), state in the extreme SE United States. A long, low peninsula between the Atlantic Ocean (E) and the Gulf of Mexico (W), Florida is bordered by Georgia and , as well as loan production offices in Fort Lauderdale, Florida Fort Lauderdale, known as the "Venice of America" due to its expansive and intricate canal system, is a city in Broward County, Florida, United States. The city's population is described as metropolitan, where diverse culture is commonplace. According to 2006 U.S. and Atlanta Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. , Georgia Georgia, country, Asia Georgia (jôr`jə), Georgian Sakartvelo, Rus. Gruziya, officially Republic of Georgia, republic (2005 est. pop. 4,677,000), c.26,900 sq mi (69,700 sq km), in W Transcaucasia. ; and Capital Bank with two full service banking offices in Montgomery Montgomery, city, United States Montgomery, city (1990 pop. 187,106), state capital and seat of Montgomery co., E central Ala., near the head of navigation on the Alabama River just below the confluence of the Coosa and Tallapoosa rivers, and in the rich Alabama. CapitalSouth targets small to medium-sized Me´di`um-sized` a. 1. Having a medium size; as, a medium-sized man s>. Adj. 1. medium-sized - intermediate in size medium-size, moderate-size, moderate-sized businesses in the markets it serves. Two of CapitalSouth Bank's offices operate under the name "Banco Hispano His·pa·no n. pl. His·pa·nos 1. A native or resident of Spanish descent living in the southwest United States. 2. A Hispanic. " and provide financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. to the growing Latino community prevalent prevalent widespread occurrence. in their areas. CapitalSouth offers 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 services and other similar programs for business owners through its Business Capital Group, which operates through full-service full-ser·vice adj. Associated with or offering complete service: full-service gasoline pumps; full-service banks. offices as well as the loan production offices. CapitalSouth also provides Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the banking services at www.capitalsouthbank.com and www.capitalbankal.com as well as personal investment services. E[acute accent]CapitalSouth Bancorp common stock is traded on the 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 Global Market System under the symbol "CAPB". E[acute accent]This press release contains "forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. " statements as defined by the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, which is based on CapitalSouth's current expectations, estimates and projections about future events and financial trends affecting the financial condition of its business. These statements are not historical facts or guarantees of future performance, events, or results. Such statements involve potential risks and uncertainties and, accordingly, actual performance results may differ materially. CapitalSouth undertakes no obligation to publicly update or revise 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. , whether as a result of new, updated information, future events, or otherwise.
CapitalSouth Bancorp
(Unaudited Financial Highlights)
(in thousands, except for per share amounts and percentages)
Three Months
Ended
June 30 Percentage
2006 2005 Change
------- ------- ----------
Net interest income $3,975 $3,135 26.8%
Provision for loan losses 104 344 -69.8%
Noninterest income 1,434 645 122.3%
Noninterest expense 3,697 2,438 51.6%
Income before provision for income taxes 1,608 998 61.1%
Provision for income taxes 614 326 88.3%
Net income $994 $672 47.9%
Weighted average common and common
equivalent shares outstanding
Basic 2,964 2,245 32.0%
Diluted 3,024 2,276 32.9%
Net income per common share
Basic $0.34 $0.30 13.3%
Diluted $0.33 $0.30 10.0%
Return on average assets 0.89% 0.75%
Return on average tangible assets 0.89% 0.75%
Return on average equity 10.09% 10.36%
Return on average tangible equity 10.43% 10.37%
Noninterest
Income
Service charges on deposits $271 $235 15.3%
Investment banking income, net 22 12 83.3%
Business Capital Group loan income 6 291 -97.9%
Other 1,135 107 960.7%
---------------
Total noninterest income $1,434 $645 122.3%
===============
Noninterest
Expense
Salaries and employee benefits $2,063 $1,332 54.9%
Occupancy and equipment expense 558 403 38.5%
Professional fees 364 246 48.0%
Advertising 172 106 62.3%
Other 540 351 53.8%
---------------
Total noninterest expense $3,697 $2,438 51.6%
===============
CapitalSouth Bancorp
(Unaudited Financial Highlights)
(in thousands, except for per share amounts and percentages)
Six Months
Ended
June 30 Percentage
2006 2005 Change
------- ------- ----------
Net interest income $7,605 $6,097 24.7%
Provision for loan losses 340 501 -32.1%
Noninterest income 1,996 1,233 61.9%
Noninterest expense 6,981 4,902 42.4%
Income before provision for income taxes 2,280 1,927 18.3%
Provision for income taxes 822 614 33.9%
Net income $1,458 $1,313 11.0%
Weighted average common and common
equivalent shares outstanding
Basic 2,953 2,244 31.6%
Diluted 3,014 2,274 32.5%
Net income per common share
Basic $0.49 $0.59 -16.9%
Diluted $0.48 $0.58 -17.2%
Return on average assets 0.67% 0.75%
Return on average tangible assets 0.67% 0.75%
Return on average equity 7.50% 10.32%
Return on average tangible equity 7.75% 10.32%
Noninterest
Income
Service charges on deposits $527 $475 10.9%
Investment banking income, net 94 33 184.8%
Business Capital Group loan income 138 536 -74.3%
Other 1,237 189 554.5%
---------------
Total noninterest income $1,996 $1,233 61.9%
===============
Noninterest
Expense
Salaries and employee benefits $3,989 $2,687 48.5%
Occupancy and equipment expense 1,079 842 28.1%
Professional fees 691 428 61.4%
Advertising 342 220 55.5%
Other 880 725 21.4%
---------------
Total noninterest expense $6,981 $4,902 42.4%
===============
June 30, June 30, Percentage
Period End Balances: 2006 2005 Change
-------------------- --------- --------- ----------
Total assets $448,330 $362,096 23.8%
Earning assets 426,134 344,860 23.6%
Securities 67,805 59,802 13.4%
Loans held for sale - 89 -100.0%
Loans 348,620 277,896 25.4%
Allowance for loan
losses 4,011 3,526 13.8%
Deposits 378,367 301,471 25.5%
Borrowings 26,185 30,537 -14.3%
Stockholders' equity 39,743 26,247 51.4%
Equity to assets 8.86% 7.25%
Leverage ratio 8.74% 7.49%
Book value per
common share $13.39 $11.68 14.6%
Tangible book value
per common share $12.96 $11.68 11.0%
Ending shares
outstanding 2,969 2,247 32.1%
Asset Quality Analysis
(in thousands, except percentages)
As of / For the Three Months Ended
June 30, Mar 31, Dec 31, Sept 30, June 30,
2006 2006 2005 2005 2005
--------- --------- ---------- -------- ---------
Nonacrrual loans $1,545 $2,135 $1,684 $1,281 $1,283
Loans past due 90
days or more and
still accruing - - - - -
Other real estate
owned and
repossessions 357 298 111 320 329
Total nonperforming
assets 1,902 2,433 1,795 1,601 1,612
Total nonperforming
assets as a
percentage of
period-end loans
and other real
estate 0.55% 0.72% 0.55% 0.56% 0.58%
Allowance for loan
losses $4,011 $4,048 $3,856 $3,744 $3,526
Provision for loan
losses 104 236 156 257 345
Loans charged off 152 67 75 67 36
Loan recoveries 10 23 31 28 22
Net charge-offs 142 44 44 39 14
Allowance for loan
losses as a
percentage of
period-end loans 1.15% 1.20% 1.18% 1.31% 1.27%
Allowance for loan
losses as a
percentage of
period-end
nonperforming loans 259.61% 189.60% 228.98% 292.27% 274.82%
Net losses to
average loans
(annualized) 0.16% 0.05% 0.06% 0.06% 0.02%
GAAP Reconciliation and Management Explanation for Non-GAAP Financial
Measures
The information set forth above contains certain financial information
determined by methods other than in accordance with GAAP. These
non-GAAP financial measures are "return on average tangible equity,"
"return on average tangible assets," and "tangible book value per
common share." Our management uses these non-GAAP measures in its
analysis of CapitalSouth's performance.
"Return on average tangible equity" is defined as annualized earnings
for the period divided by average equity reduced by average goodwill
and other intangible assets. "Return on average tangible assets" is
defined as annualized earnings for the period divided by average
assets reduced by average goodwill and other intangible assets. Our
management includes these measures because it believes that they are
important when measuring CapitalSouth's performance against entities
with higher levels of goodwill and other intangibles. These measures
are used by many investors as part of their analysis of the bank
holding company's performance.
"Tangible book value per common share" is defined as total equity
reduced by recorded intangible assets divided by total common shares
outstanding. This measure is important to many investors in the
marketplace who are interested in changes from period to period in
book value per share exclusive of changes in intangible assets.
Goodwill, an intangible asset that is recorded in a purchase business
combination, has the effect of increasing total book value while not
increasing the tangible assets of the company.
These disclosures should not be viewed as a substitute for results
determined in accordance with GAAP, and are not necessarily comparable
to non-GAAP performance measures which may be presented by other bank
holding companies. The following reconciliation table provides a more
detailed analysis of these non-GAAP performance measures.
As of / For the Three Months Ended
June 30,
(in thousands, except percentages)
2006 2005
----------------- ---------------
Book value of equity $39,743 $26,247
Intangible assets 1,277 7
----------------- ---------------
Book value of tangible equity $38,466 $26,240
================= ===============
Average assets $449,202 $360,927
Average intangible assets 1,277 7
----------------- ---------------
Average tangible assets $447,925 $360,920
================= ===============
Return on average assets 0.89% 0.75%
Effect of average intangible
assets 0.00% 0.00%
----------------- ---------------
Return on average tangible assets 0.89% 0.75%
================= ===============
Average equity $39,494 $26,005
Average intangible assets 1,277 7
----------------- ---------------
Average tangible equity $38,217 $25,998
================= ===============
Return on average equity 10.09% 10.36%
Effect of average intangible
assets 0.34% 0.01%
----------------- ---------------
Return on average tangible equity 10.43% 10.37%
================= ===============
Per Share:
Book value $13.39 $11.68
Effect of intangible assets 0.43 -
----------------- ---------------
Tangible book value $12.96 $11.68
================= ===============
percentages are annualized
As of / For the Six Months Ended
June 30,
(in thousands, except percentages)
2006 2005
----------------- ---------------
Book value of equity $39,743 $26,247
Intangible assets 1,277 7
----------------- ---------------
Book value of tangible equity $38,466 $26,240
================= ===============
Average assets $437,992 $354,844
Average intangible assets 1,277 7
----------------- ---------------
Average tangible assets $436,715 $354,837
================= ===============
Return on average assets 0.67% 0.75%
Effect of average intangible
assets 0.00% 0.00%
----------------- ---------------
Return on average tangible assets 0.67% 0.75%
================= ===============
Average equity $39,193 $25,652
Average intangible assets 1,277 7
----------------- ---------------
Average tangible equity $37,916 $25,645
================= ===============
Return on average equity 7.50% 10.32%
Effect of average intangible
assets 0.25% 0.00%
----------------- ---------------
Return on average tangible equity 7.75% 10.32%
================= ===============
Per Share:
Book value $13.39 $11.68
Effect of intangible assets 0.43 -
----------------- ---------------
Tangible book value $12.96 $11.68
================= ===============
percentages are annualized
CAPITALSOUTH BANCORP AND SUBSIDIARIES
Consolidated Balance Sheets
(unaudited)
June 30, 2006 and 2005
Assets 2006 2005
------------- ------------
Cash and cash equivalents $9,037,857 7,048,856
Federal funds sold 5,244,233 2,779,244
Securities available-for-sale 37,743,681 26,244,882
Securities held-to-maturity, fair values of
$26,576,979 and $30,896,744 at June 30,
2006 and 2005, respectively 27,874,012 31,174,075
Federal Home Loan Bank stock 1,222,300 1,219,200
Federal Reserve Bank stock 894,650 594,250
Loans held-for-sale -- 88,529
Loans 348,619,600 277,896,489
Allowance for loan losses (4,010,751) (3,525,835)
------------- ------------
Net loans 344,608,849 274,370,654
Premises and equipment, net 10,675,984 9,271,646
Bank-owned life insurance 4,465,759 4,293,383
Other assets 6,562,554 5,011,246
------------- ------------
Total assets $448,329,879 362,095,965
============= ============
Liabilities and Stockholders' Equity
Deposits:
Interest-bearing $326,057,378 257,361,073
Noninterest-bearing 52,310,055 44,110,383
------------- ------------
Total deposits 378,367,433 301,471,456
Federal funds purchased 1,510,000 1,130,000
Borrowed funds 6,000,000 10,811,507
Repurchase agreements 10,942,359 12,201,652
Note payable -- 1,205,000
Subordinated debentures 7,733,000 5,000,000
Other liabilities 4,034,504 4,029,556
------------- ------------
Total liabilities 408,587,296 335,849,171
------------- ------------
Stockholders' equity:
Preferred stock, $0.01 par value.
Authorized 500,000 shares; issued and
outstanding none -- --
Common stock, $1 par value. Authorized
7,500,000 and 5,000,000 shares,
respectively; issued 3,053,646 and
2,331,779 shares at June 30, 2006 and
2005, respectively; outstanding
2,968,816 and 2,246,949 shares at June
30, 2006 and 2005, respectively 3,053,646 2,331,779
Treasury stock, at cost, 84,830 shares in
2006 and 2005 (1,255,060) (1,255,060)
Paid-in surplus 26,190,009 15,219,179
Retained earnings 12,550,958 10,293,074
Accumulated other comprehensive loss, net (796,970) (342,178)
------------- ------------
Total stockholders' equity 39,742,583 26,246,794
------------- ------------
Total liabilities and
stockholders' equity $448,329,879 362,095,965
============= ============
CAPITALSOUTH BANCORP AND SUBSIDIARIES
Consolidated Statements of Income
Three and Six Months Ended June 30, 2006 and 2005
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- -----------------------
2006 2005 2006 2005
----------- ---------- ------------ ----------
Interest income:
Interest and fees on
loans $6,818,665 4,625,210 $12,981,200 8,721,621
Interest on
securities 668,608 559,981 1,338,321 1,122,579
Interest on federal
funds sold 120,048 17,266 136,698 29,087
----------- ---------- ------------ ----------
Total interest
income 7,607,321 5,202,457 14,456,219 9,873,287
----------- ---------- ------------ ----------
Interest expense:
Interest on deposits 3,266,106 1,667,031 5,979,140 2,967,881
Interest on debt 366,555 400,106 871,775 808,322
----------- ---------- ------------ ----------
Total interest
expense 3,632,661 2,067,137 6,850,915 3,776,203
----------- ---------- ------------ ----------
Net interest
income 3,974,660 3,135,320 7,605,304 6,097,084
Provision for loan
losses 104,450 344,353 340,456 500,732
----------- ---------- ------------ ----------
Net interest
income after
provision for
loan losses 3,870,210 2,790,967 7,264,848 5,596,352
----------- ---------- ------------ ----------
Noninterest income:
Service charges on
deposits 270,538 235,226 526,661 474,647
Investment banking
income, net 21,860 11,513 94,102 33,058
Gain on sale of
available-for-sale
securities, net -- -- -- --
Business Capital
Group loan income 5,582 291,257 137,774 535,719
Bank-owned life
insurance 41,070 44,479 83,418 88,959
Other noninterest
income 1,095,505 62,354 1,154,073 100,098
----------- ---------- ------------ ----------
Total noninterest
income 1,434,555 644,829 1,996,028 1,232,481
----------- ---------- ------------ ----------
Noninterest expense:
Salaries and employee
benefits 2,062,819 1,331,667 3,989,291 2,687,483
Occupancy and
equipment expense 557,876 403,303 1,078,644 841,904
Professional fees 363,533 246,266 690,934 428,046
Advertising 172,216 106,143 341,544 219,777
Other noninterest
expense 540,559 350,007 880,302 724,570
----------- ---------- ------------ ----------
Total noninterest
expense 3,697,003 2,437,386 6,980,715 4,901,780
----------- ---------- ------------ ----------
Income before
provision for
income taxes 1,607,762 998,410 2,280,161 1,927,053
Provision for income
taxes 614,136 325,963 822,289 613,579
----------- ---------- ------------ ----------
Net income $993,626 672,447 $1,457,872 1,313,474
=========== ========== ============ ==========
Basic earnings per
share $0.34 0.30 $0.49 0.59
Basic weighted average
shares outstanding 2,963,945 2,244,942 2,953,147 2,243,588
Diluted earnings per
share $0.33 0.30 $0.48 0.58
Diluted weighted
average shares
outstanding 3,024,187 2,275,702 3,014,283 2,274,354
Average Balance Sheet
and Net Interest Analysis on a Fully
Tax-Equivalent Basis For
the Three Months Ended June 30,
-------------------------------------------------
2006 2005
------------------------ ------------------------
Average Income/ Yield/ Average Income/ Yield/
Balance Expense Rate Balance Expense Rate
--------- ------- ------ --------- ------- ------
(Dollar amounts in thousands)
Assets
Earning assets:
Loans, net of
unearned income $345,447 $6,825 7.92% $277,475 $4,629 6.69%
Investment
securities 67,572 685 4.07 59,095 564 3.83
Other earning assets 12,063 149 4.95 4,698 47 4.01
--------- ------- ------ --------- ------- ------
Total earning
assets 425,082 7,659 7.23 341,268 5,240 6.16
------- ------ ------- ------
Other assets 24,120 19,659
--------- ---------
Total assets $449,202 $360,927
========= =========
Liabilities and
shareholders' equity
Interest-bearing
liabilities:
NOW and money market
accounts 119,846 1,083 3.62 77,039 418 2.18
Savings deposits 3,822 3 0.31 3,676 3 0.33
Time deposits less
than $100,000 173,016 1,859 4.31 133,869 1,030 3.09
Time deposits
greater than
$100,000 26,644 253 3.81 26,069 177 2.72
State of Alabama
time deposits 6,030 68 4.52 5,780 39 2.71
Federal funds
purchased 294 2 2.73 14,527 118 3.26
FHLB advances 6,000 88 5.88 11,000 107 3.90
Repurchase
agreements 11,006 127 4.63 12,136 77 2.54
Subordinated
debentures 7,733 150 7.78 5,000 83 6.66
Other borrowings - - 1,205 15 4.99
--------- ------- ------ --------- ------- ------
Total interest-
bearing
liabilities 354,391 3,633 4.11 290,301 2,067 2.86
--------- ------- ------ --------- ------- ------
Net interest spread 4,026 3.12 3,173 3.30
======= =======
Noninterest-bearing
demand deposits 51,550 41,479
Accrued expenses and
other liabilities 3,766 3,142
Stockholders' equity 40,204 26,390
Unrealized gain
(loss) on
securities (709) (385)
--------- ---------
Total liabilities
and
stockholders'
equity $449,202 $360,927
========= =========
Impact of
noninterest-
bearing sources
and other changes
in balance sheet
composition 0.68 0.43
------ ------
Net interest margin 3.80% 3.73%
====== ======
Average Balance Sheet
and Net Interest Analysis on a Fully
Tax-Equivalent Basis For
the Six Months Ended June 30,
--------------------------------------------------
2006 2005
------------------------- ------------------------
Average Income/ Yield/ Average Income/ Yield/
Balance Expense Rate Balance Expense Rate
--------- -------- ------ --------- ------- ------
(Dollar amounts in thousands)
Assets
Earning assets:
Loans, net of
unearned income $338,731 $12,994 7.74% $272,235 $8,729 6.47%
Investment
securities 67,139 1,358 4.08 59,960 1,127 3.79
Other earning
assets 7,802 199 5.14 4,672 91 3.93
--------- -------- ------ --------- ------- ------
Total earning
assets 413,672 14,551 7.09 336,867 9,947 5.95
-------- ------ ------- ------
Other assets 24,320 17,977
--------- ---------
Total assets $437,992 $354,844
========= =========
Liabilities and
shareholders' equity
Interest-bearing
liabilities:
NOW and money
market accounts 108,789 1,810 3.36 78,309 778 2.00
Savings deposits 3,817 7 0.37 3,718 6 0.33
Time deposits less
than $100,000 169,124 3,538 4.22 125,450 1,793 2.88
Time deposits
greater than
$100,000 26,145 496 3.83 25,970 320 2.48
State of Alabama
time deposits 6,007 129 4.33 5,780 71 2.48
Federal funds
purchased 5,251 127 4.88 18,022 267 2.99
FHLB advances 7,199 212 5.94 11,000 205 3.76
Repurchase
agreements 11,054 242 4.41 12,810 153 2.41
Subordinated
debentures 7,733 290 7.56 5,000 158 6.37
Other borrowings - - 1,205 25 4.18
--------- -------- ------ --------- ------- ------
Total interest-
bearing
liabilities 345,119 6,851 4.00 287,264 3,776 2.65
--------- -------- ------ --------- ------- ------
Net interest spread 7,700 3.09 6,171 3.30
======== =======
Noninterest-bearing
demand deposits 49,874 39,014
Accrued expenses
and other
liabilities 3,806 2,914
Stockholders'
equity 39,830 25,992
Unrealized gain
(loss) on
securities (637) (340)
--------- ---------
Total
liabilities and
stockholders'
equity $437,992 $354,844
========= =========
Impact of
noninterest-
bearing sources
and other changes
in balance sheet
composition 0.66 0.39
------ ------
Net interest margin 3.75% 3.69%
====== ======
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