City Bank Announces Strong Earnings Results for First Nine Months of 2007 and Third Quarter Earnings.LYNNWOOD Lynnwood, city (1990 pop. 28,695), Snohomish co., W central Wash., a residential and industrial suburb of Seattle; inc. 1959. Aerospace parts, communications and electrical equipment, electronic components, precious metal jewelry, and scales and balances are among , Wash. -- City Bank (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CTBK) today announced strong earnings of $31.31 million for the nine months ended September September: see month. 30, 2007, reflecting an increase of 14.59% from $27.32 million for the same period in 2006. All prior period results have been restated for the 3-for-2 stock split on December 22, 2006, with no effect on net income or 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. . Net income for the quarter ended September 30, 2007, was $10.38 million, an increase of $476 thousand or 4.81% compared to $9.90 million for the third quarter of 2006. The Bank's 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. net income of $.65 per share reflects an increase of 3.17% from $.63 per share for the third quarter of 2006. Net interest income after provision for credit losses was $20.03 million for the third quarter of 2007 compared to $19.07 million for the same period in 2006, reflecting an increase of 5.04%. The increased net interest income for the quarter ended September 30, 2007, was primarily due to continued growth in average loan balances from $892.16 million to $1.09 billion compared to the same period in 2006. Loan growth was the major factor that resulted in the Bank's solid earnings for the three months ended September 30, 2007. [TABLE OMITTED] Net income for the nine months ended September 30, 2007, was $31.31 million compared to $27.32 million in the prior year, reflecting an increase of $3.99 million. On a diluted per share basis, net income was up 13.89% to $1.97 from $1.73 in the comparable period in 2006. Net interest income after provision for credit losses was $60.68 million for the nine months ended September 30, 2007, compared to $53.14 million for the same period in 2006, reflecting an increase of 14.20%. The increase in net interest income for the nine months ended September 30, 2007, was due to continued growth in average loan volume, which increased from $848.50 million in 2006 to $1.05 billion in 2007 compared to the same period in 2006. [TABLE OMITTED] Result of Operations Interest income for the three and nine months ended September 30, 2007, was up 16.99% and 25.12%, respectively, from the comparable periods in 2006 due to increased loan volume. Average outstanding loans was up $197.20 million or 22.10% for the three months ended September 30, 2007, and $204.90 million or 24.15% for the nine months ended September 30, 2007, over the same periods in 2006. The average yield on loans for the three and nine months ended September 30, 2007, were 11.18% and 11.24%, respectively, compared to 11.59% and 11.14% during the same periods in 2006. For the nine months ended September 30, 2007, net interest margin reflects a slight decrease of 5.72% to 7.42% from 7.87% in the prior year due to the higher cost of funding loan growth. Nonperforming assets Nonperforming asset An asset that is not effectively producing income, such as an overdue loan. nonperforming asset An asset that produces no income. at September 30, 2007, was $9.83 million compared to $1.21 million at September 30, 2006. The ratio of nonperforming assets to total assets at September 30, 2007, increased to .83% over .12% at September 30, 2006. A loan loss provision of $675 thousand was added for the quarter ended September 30, 2007, compared to no allowance in the prior year. Net loan charge-offs were $682 thousand for the three months ended September 30, 2007, compared to $25 thousand in the prior year. For the nine months ended September 30, 2007, net loan charge-offs were $839 thousand compared to $66 thousand in the prior year and total provision for credit loss was $825 thousand compared to no provision in the prior year. Interest expense for the third quarter of 2007 was up 38.37% over the comparable period in 2006. Average cost of deposits for the third quarter of 2007 increased to 4.64%, up from 4.07% for the third quarter of 2006. Average time deposits and borrowed funds for the third quarter of 2007 were $894.75 million, resulting in a 21.37% increase over the comparable quarter in 2006 of $737.18 million. Non-interest income of $607 thousand reflects a net decrease of $407 thousand or 40.14% for the third quarter of 2007 from the prior quarter of 2006. The majority of the decreases were due to a decrease of $152 thousand in net gains from sale of loans and a decrease of $91 thousand in investment products income compared to the same quarter in 2006. 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 loan servicing Loan servicing is the process by which a mortgage bank or subservicing firm collects the timely payment of interest and principal from borrowers. The level of service varies depending on the type loan and the terms negotiated between the firm and the investor seeking their services. income also decreased by $26 thousand compared to the same quarter in 2006. Non-interest expense of $4.51 million in the third quarter of 2007 reflects a net decrease of 6.94% or $336 thousand compared to the same quarter of 2006. The majority of the decrease relates to the decrease in salaries and benefits expense of $210 thousand for the quarter compared to the same period in 2006 due to a slight decrease in staffing. Foreclosed real estate expense and furniture and equipment decreased by $70 thousand and $49 thousand, respectively, compared to the same quarter in 2006 At September 30, 2007, total assets were $1.18 billion, up 15.92% over September 30, 2006. Asset growth since December 31, 2006, was $101.78 million or 9.44%. Loans grew 19.73% to $1.10 billion compared to $921.82 million at September 30, 2006. Loan growth since December 31, 2006, was $138.02 million or 14.29%. Deposits increased 15.62% to $827.23 million at September 30, 2007, compared to $715.47 million at September 30, 2006, and 8.35% compared to $763.49 million at December 31, 2006. City Bank's return on average assets for the nine months ended September 30, 2007, was 3.73% compared to 3.98% for the same period in 2006. Return on average equity was 20.27% for the nine month period, compared to 19.34% for the same period in 2006. The ratio of average equity to average assets (Tier 1 Capital Tier 1 Capital A term used to describe the capital adequacy of a bank. Tier I capital is core capital, this includes equity capital and disclosed reserves. Notes: Equity capital includes instruments that can't be redeemed at the option of the holder. ) for the nine months ended September 30, 2007, was 18.42% compared to 20.56% for the same period in 2006. The Tier 1 Capital Ratio decreased slightly due to the significant increase in the Bank's total assets for the period ended September 30, 2007. 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. The previous discussion contains a review of City Bank's operating results and financial condition for the three and nine month ended September 30, 2007 and 2006. The discussion may contain certain forward-looking statements, which are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of 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. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those stated, including, but not limited to, the Bank's inability to generate increased 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 , sustain credit losses, maintain adequate net interest margin, control fluctuations in operating results, maintain liquidity to fund assets Fund assets The total value of a portfolio's securities, cash, and other holdings, minus any outstanding debts. , retain key personnel, and other risks detailed from time to time in the Bank's filings with the Federal Deposit Insurance Corporation Federal Deposit Insurance Corporation (FDIC), an independent U.S. federal executive agency designed to promote public confidence in banks and to provide insurance coverage for bank deposits up to $100,000. , including our Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the period ended December 31, 2006. Readers are cautioned not to place undue reliance on these forward-looking statements. City Bank is a state-chartered commercial bank founded in 1974 and headquartered in Lynnwood, Washington Lynnwood is a city in Snohomish County, Washington, United States. The population was 33,847 at the 2000 census making it the third largest in Snohomish County and twenty-fourth largest in Washington State. . The bank is publicly traded (NASDAQ: CTBK) and many of the stockholders are local individuals. Eight banking offices serve both Snohomish and North King counties. Two mortgage loan offices serve Snohomish, King and Pierce counties Pierce County is the name of five counties in the United States:
[TABLE OMITTED] |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion