Catskill Financial Announces 28.0% Increase in First Quarter Earnings Per Share.Business Editors CATSKILL Catskill (kăt`skĭl), village (1990 pop. 4,690), seat of Greene co., SE N.Y., on the Hudson River; settled 17th cent. by Dutch, inc. 1806. Connected with Hudson, N.Y. , N.Y.--(BUSINESS WIRE)--January 19, 2000 Catskill Financial Corporation (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 : CATB) (the "Company"), the parent of Catskill Savings Bank savings bank, financial institution that, until recently, performed only the following functions: receiving savings deposits of individuals, investing them, and providing a modest return to its depositors in the form of interest. , today reported earnings per share of $.32 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 December December: see month. 31, 1999, an increase of 28.0% compared to $.25 reported for the quarter ended December 31, 1998. Net income for the quarter ended December 31, 1999, was $1,102,000, up $121,000, or 12.3%, from the quarter ended December 31, 1998. The increase in net income was principally higher net interest income and non-interest income partially offset by an increase in non-interest expense. Commenting on highlights for the quarter ended December 31, 1999, Wilbur Wil·bur , Richard Purdy Born 1921. American poet whose works, including Things of This World (1956), adhere to formal conventions of rhyme and meter. J. Cross, Chairman, 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. stated: "We are very pleased to announce that our capital management strategies have enabled us to report our eighth consecutive quarter of double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. earnings per share growth. The Company continues its capital management strategies and during the quarter, we repurchased 150,000 shares of our common stock at a cost that was less than its book value. The Company still has Board authorization The right or permission to use a system resource; the process of granting access. See access control. to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. over 200,000 shares, and expects stock repurchases Stock repurchase A firm's repurchase of outstanding shares of its common stock. , especially at current market prices, will continue to enhance shareholder value. We also expect to continue our strategy of expanding in small towns and rural communities, where we can provide high-quality personal service to an under-served middle market." Net interest income on a tax equivalent basis for the quarter ended December 31, 1999, was $3.2 million, up $224,000, or 7.6%, over the comparable period. The increase was principally volume related with average 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 up $23.1 million, or 7.5%, more than offsetting the increase in interest expense related to borrowings used to fund the Company's stock repurchase and corporate-owned life insurance Corporate-owned life insurance (COLI) is life insurance on employees' lives that is owned by the employer corporation. COLI was originally purchased on the lives of key employees and executives by a company to hedge against the financial cost of losing key employees to purchases. Weighted average common shares outstanding for the quarter ended December 31, 1999, were 3,408,380, down 430,898 shares, or 11.2% from the comparable period. The growth in earning assets was primarily loans. Average loans outstanding increased $15.0 million, or 10.6% over the quarter ended December 31, 1998. Net interest spread for the quarter was 3.17%, up 16 basis points from the comparable quarter, as the Company's funding costs, principally on deposits, have repriced down faster than its earning assets. The Company's net yield on average earning assets was 3.85% for the quarter ended December 31, 1999, up only one basis point from the comparable period, principally due to the funding of share repurchases Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. with borrowings. Non-interest income was $199,000, an increase of $42,000, or 26.8%. The increase was principally due to the investment performance on the Company's corporate-owned life insurance, which increased its cash surrender value The amount of money that an insurance company pays the insured upon cancellation of a life insurance policy before death and which is a specific figure assigned to the policy at that particular time, reduced by a charge for administrative expenses. , offset somewhat by securities losses, as the Company sold securities and reinvested some of the proceeds at higher rates. Service fees on deposit accounts increased $16,000, or 18.0%, as the Company continues to promote checking related products to increase core deposits and diversify diversify To acquire a variety of assets that do not tend to change in value at the same time. To diversify a securities portfolio is to purchase different types of securities in different companies in unrelated industries. its revenue. In addition, the Company earned $16,000 in service fees due to the implementation of ATM surcharges during the quarter on non-customer transactions. Non-interest expenses were $1,593,000, an increase of $128,000, or 8.7%, over the comparable period last year. The increase was principally the cost due to the opening of a sixth full-service full-ser·vice adj. Associated with or offering complete service: full-service gasoline pumps; full-service banks. branch in August 1999, including certain promotional and start-up Start-up The earliest stage of a new business venture. costs. The provision for loan losses for the quarter ended December 31, 1999, was $50,000, up $5,000, or 11.1%, from the comparable quarter. The increase was principally based on loan growth, as the provision represented .13% of average loans in both periods. The Company had net charge-offs of $3,000 or .01% of average loans for the quarter ended December 31, 1999, compared to net chargeoffs of $11,000 or .03% of average loans in the comparable period. 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. were $539,000 as of December 31, 1999, or .34% of total loans. As of December 31, 1998 they were $506,000, but still represented only .35% of total loans. At December 31, 1999, the allowance for loan losses was $2,140,000, or 1.34% of period end loans, and provided coverage of non-performing loans of 397.0%, compared to an allowance of 1.37% and coverage of 392.1% as of December 31, 1998, respectively. At December 31, 1999, total assets were $342.3 million and 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. was $56.1 million, or 16.4% of total assets. Book value per common share Book Value Per Common Share A measure used by owners of common shares in a firm to determine the level of safety associated with each individual share after all debts are paid accordingly. Formula: was $14.82 and common shares outstanding were 3,785,269. This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , which are subject to numerous assumptions, risks and uncertainties. Actual results could differ materially from those contained in or implied by such forward-looking statements for a variety of factors including: sharp and/or rapid changes in interest rates; changes in the local, regional or national economy, which could materially change anticipated credit quality trends and the ability to generate loans; and changes in accounting, tax, or regulatory practices or requirements. Catskill Financial Corporation is a unitary unitary pertaining to a single object or individual. thrift thrift: see leadwort. holding company, whose only subsidiary is Catskill Savings Bank. Catskill Savings Bank is the largest banking institution headquartered in Greene County Greene County is the name of fourteen counties in the United States of America, each named in honor of American Revolutionary War general Nathanael Greene:
CATSKILL FINANCIAL CORPORATION
Selected Consolidated Financial Information
(unaudited)
Selected Consolidated Dec 31, Sept 30, Dec 31,
Financial Condition Data 1999 1999 1998
(Dollars in thousands)
Total Assets $342,324 $338,796 $323,793
Earning Assets(a) 330,142 325,958 303,990
Securities AFS(a) 167,230 170,284 155,180
Securities HTM(a) --- --- 2,064
Loans 159,497 152,914 144,528
Allowance for Loan Losses 2,140 2,093 1,984
Deposits 219,037 219,064 215,133
Borrowings 65,350 56,100 34,825
Shareholders' Equity 56,112 59,212 68,062
(a) at amortized cost
Three Months Ended
Selected Consolidated Dec 31, Sept 30, Dec 31,
Operating Data 1999 1999 1998
(Dollars in thousands except share and per share data)
Total interest income $ 5,775 $ 5,670 $ 5,353
Total interest expense 2,935 2,807 2,626
----- ----- -----
Net interest income (te) 2,840 2,863 2,727
Provision for loan losses 50 50 45
----- ----- -----
Net interest income after
provision for loan losses 2,790 2,813 2,682
Non-interest income 199 196 157
Non-interest expense 1,593 1,600 1,465
----- ----- -----
Income before taxes 1,396 1,408 1,374
Income tax expense 294 305 393
----- ----- -----
Net Income $ 1,102 $ 1,104 $ 981
===== ===== =====
Basic earnings per share $ .32 $ .31 $ .26
Diluted earnings per share $ .32 $ .30 $ .25
Weighted average common
shares outstanding-basic 3,408,380 3,518,497 3,839,278
Weighted average common shares
outstanding-diluted 3,468,656 3,621,894 3,879,890
(te) Net interest income on a
tax equivalent basis $ 3,186 $ 3,205 $ 2,962
CATSKILL FINANCIAL CORPORATION
Selected Consolidated Financial Information
(unaudited)
Three Months Ended
Selected Consolidated Dec 31,
Average Balance Data 1999 1998
(Dollars in thousands)
Loans $156,552 $141,515
Mortgage Backed Securities(b) 71,611 85,331
Other Securities(b) 101,201 79,410
Other Interest Bearing Assets 64 62
----- -------
Earning Assets(b) $329,428 $306,318
Other Assets, Net 11,050 8,220
- -------
Total Assets $340,478 $314,538
======= =======
Interest Bearing Deposits $212,420 $206,830
Short-term Borrowings 39,297 5,436
Long-term Borrowings 22,500 25,000
Non-interest Bearing Deposits 8,718 6,541
Other Liabilities 149 3,558
Shareholders' Equity 57,394 67,173
- -------
Total Liabilities & Equity $340,478 $314,538
======= =======
(b) at amortized cost
Three Months Ended
Selected Consolidated Dec 31,
Financial Ratios 1999 1998
Return on average assets 1.29% 1.24%
Return on average equity 7.64% 5.79%
Net interest spread(te) 3.17% 2.91%
Net interest margin(te) 3.85% 3.84%
Efficiency ratio(1) 47.06% 46.97%
(te) Tax equivalent basis
(1) Non-interest expense divided by the sum of non-interest
income and net interest income on a tax equivalent basis.
Dec 31, Sept 30, Dec 31,
Selected Asset Quality Ratios 1999 1999 1998
Net charge-offs to average loans .01% .02% .03%
Non-performing loans to total loans .34% .36% .35%
Allowance for loan losses to total loans 1.34% 1.37% 1.37%
Allowance to non-performing loans 397.03% 384.74% 392.09%
Non-performing assets to total assets .19% .16% .18%
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