CityBank Announces Earnings for 2004 and the Quarter Ended December 31, 2004.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. -- CityBank (Nasdaq:CTBK): THE YEAR CityBank today announced results for the year ended December December: see month. 31, 2004. Net income for 2004 was $19.0 million, compared with $19.3 million for 2003, reflecting a decrease of 1.6%. On a 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. per share basis, net income was $1.88 for the year, compared with $1.94 last year, reflecting a decrease of $.06 and 3.1%. As of December 31, 2004, compared to December 31, 2003, total assets grew to $667 million or 7.9%. CityBank's loans grew to $597 million or 15.7% while deposits grew to $421 million or 8.6%. The $81 million increase in the loan portfolio was primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to strong demand for residential construction loans. Non-performing assets were reduced by 64.9%, resulting in a ratio of 1.28% of Total Assets. CityBank continued to invest for future growth of the Bank's subsidiary, which resulted in reduced net income at Diligenz, Inc., primarily due to increased compensation expenses for expanded sales and customer service personnel. CityBank's equity capital remains high at 23.3% after the payout pay·out n. 1. The act or an instance of paying out. 2. A percentage of corporate earnings that is paid as dividends to shareholders. of $1.80 per share or $17.9 million in dividends during 2004. The following table reports CityBank's return on average assets and average equity and ratio of average equity to average assets for the twelve months ended December 31, 2004, and 2003.
2004 2003
------ ------
Return on average asset (ROA) 2.95% 3.02%
Return on average equity (ROE) 12.08% 12.72%
Average equity to average assets 24.46% 23.73%
Interest income of $44.6 million for the year ended December 31, 2004, was down 2.4% from the same period in 2003, primarily due to lower average yield. Average outstanding loans were up 1.9% compared to the year ended December 31, 2003, while the yield on average loans decreased to 7.76% from 8.10% and net interest margin decreased to 5.85% from 5.91%. In this rising interest rate environment, management anticipates increased yields and margin during the coming year. Interest expense of $8.7 million for the year ended December 31, 2004, was down 11.8% from the prior year. Average cost of deposits for 2004 decreased to 1.43% from 1.73% for the year of 2003. Average deposits for 2004 of $405 million reflected a 2.0% decrease from the 2003 average deposits of $413 million. Noninterest income of $29.4 million reflected a 7.5% net decrease during 2004 compared to 2003. There was a decrease of $3.9 million or 52.6% in gains on sale of loans. Mortgage loans sold during 2004 were $137 million, versus $328 million during 2003, due in part to a less active re-finance market and a reduction in the average production per employee in CityBank's mortgage banking operations. Merchant credit card discount income decreased $1.3 million or 21.7%. In addition, net decreases in other operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. included: brokered loan fees of $221 thousand; gain on forward sales forward sales npl → ventas fpl a término of $273 thousand and gain on sale of OREO of $1.2 million. Partially offsetting these decreases was an increase in sales revenue at Diligenz, Inc. of $4.7 million or 36.4%. Diligenz is the Bank's majority owned subsidiary which provides online documentation search and retrieval retrieval /re·triev·al/ (-tre´v'l) in psychology, the process of obtaining memory information from wherever it has been stored. re·triev·al n. services to a nation-wide nation-wide adj → diffuso/a in tutto il paese adv → in tutto il paese customer base. Noninterest expense of $35.5 million reflected a 3.0% net decrease during 2004 compared to 2003. Salary expense reflected a net decrease of $1.6 million or 18.9%. The net decrease resulted from a decrease in mortgage loan commissions of $1.7 million, a decrease in CityBank salaries of $137 thousand and an increase in salaries at Diligenz, Inc. of $2.0 million due to an increased employee base. A decrease to salary expense of $1.8 million was the result of employee loan production costs being recovered from loan origination 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. fees prior to their deferral deferral - Waiting for quiet on the Ethernet. . This occurred due to increased loan volumes and fees, primarily in construction loans compared to the same period in 2003. Diligenz' UCC An abbreviation for the Uniform Commercial Code. data, film and search costs Search costs Costs associated with locating a counterparty to a trade, including explicit costs (such as advertising) and implicit costs (such as the value of time). Related: Information costs. reflects a net increase of $2.7 million primarily reflecting increased transaction activity. At December 31, 2004, compared to December 31, 2003, merchant credit card processing expense reflected a decrease of $1.3 million or 25.2% and foreclosed real estate expense reflected a decrease of $739 thousand or 55.6%. THE QUARTER Fourth quarter, ended December 31, 2004, reflected a slight decrease in consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: earnings from fourth quarter 2003. Net income for fourth quarter 2004 was $4.5 million, compared with $4.6 million for the fourth quarter of 2003, reflecting a decrease of 2.6%. On a diluted per share basis, net income was $.44 for the quarter, compared with $.46 last year, reflecting a decrease of $.02 and 4.3%. Interest income of $11.8 million for the fourth quarter of 2004 was up 6.5% from the same period in 2003. Fourth quarter 2004 average outstanding loans were up 10.1% compared to fourth quarter 2003; however, the yield on average loans decreased quarter to quarter to 7.96% from 8.22% and net interest margin decreased to 5.76% from 6.00%. Management anticipates continued growth in loan volume and additional increases in interest income because of the overall increase in interest rates. Non-performing assets decreased from $24.2 million to $8.5 million, a 64.8% decrease from the same period in 2003. The ratio of non-performing assets to total assets decreased to 1.28% at December 31, 2004, from 3.91% at December 31, 2003. Interest expense of $2.5 million for the fourth quarter of 2004 was up 19.5% from the comparable period in 2003. Average cost of deposits for the fourth quarter of 2004 increased to 1.58% compared to 1.39% for the fourth quarter of 2003. Average deposits for the fourth quarter 2004 of $425 million reflected a 5.5% increase over the comparable quarter in 2003 of $401 million. Noninterest income of $6.6 million reflected a 15.3% net decrease during fourth quarter 2004 from fourth quarter 2003. A decrease of $1.4 million or 73.1% was reflected in gains on sale of loans. Mortgage loans sold during fourth quarter 2004 were $19.7 million, versus $64.4 million during fourth quarter 2003, due in part to a less active re-finance market and a reduction in the average production per employee in CityBank's mortgage banking operations. Merchant credit card discount income decreased $156 thousand or 12.5%. In addition, brokered loan fees, included in other operating income, were $485 thousand lower. Partially offsetting these decreases was an increase in the sales revenue at Diligenz to $4.2 million, an increase of $607 thousand or 16.9%. Diligenz is the Bank's majority owned subsidiary which provides online documentation search and retrieval services to a nation-wide customer base. Noninterest expense of $9.1 million reflected a 4.8% net decrease compared to fourth quarter of 2003. Salary expense reflected a net increase of $52 thousand or 2.3% due to the net effect of increases in number of employees and decreases in mortgage loan commissions. Diligenz' UCC data, film and search costs reflects an increase of $492 thousand. At December 31, 2004, compared to December 31, 2003, merchant credit card processing expense reflected a decrease of $312 thousand or 30.6% and foreclosed real estate expense reflected a decrease of $162 thousand or 66.9%. 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 CityBank's operating results and financial condition for the year and quarter ended December 31, 2004. 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. Readers are cautioned not to place undue reliance on these forward-looking statements. CityBank 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 shareholders are local individuals. Eight banking offices serve both Snohomish Snohomish can refer to:
Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. State as well as nationally. CityBank's majority owned subsidiary, Diligenz, Inc. is a nationwide due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. and document retrieval The ability to search for documents by keywords and other attributes such as date and author. It implies that the documents have been indexed on all pertinent fields and that keywords have been chosen based upon title and textual content. See document imaging and document management system. service provider. Diligenz, Inc. offers the industry's most complete and accurate UCC searching, filing and due diligence services, including corporate good standing searches. These services are accomplished online in real time right from the client's desktop with a proprietary search and retrieval system accessed through Diligenz' internet site.
CityBank
Selected Consolidated Financial Highlights
(In thousands, except per share data and ratios; unaudited)
Three months ended Twelve months ended
December December
2004 2003 % Change 2004 2003 % Change
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Income Statement Data
Interest
income $11,808 $11,083 6.54% $44,578 $45,687 -2.43%
Interest
expense 2,465 2,063 19.49% 8,660 9,814 -11.76%
Net interest
income 9,343 9,020 3.58% 35,918 35,873 0.13%
Provision for
credit losses 0 45 -100.00% 375 1,070 -64.95%
Net interest
income after
provision for
credit losses 9,343 8,975 4.10% 35,543 34,803 2.13%
Diligenz Sales
Revenue 4,208 3,601 16.86% 17,704 12,978 36.42%
Other
noninterest
income 2,408 4,210 -42.80% 11,730 18,826 -37.69%
Diligenz UCC
data and
search expense 2,113 1,595 32.48% 8,376 5,710 46.69%
Other
noninterest
expense 6,987 7,964 -12.27% 27,121 30,870 -12.14%
Income before
income taxes 6,859 7,227 -5.09% 29,480 30,027 -1.82%
Income Taxes 2,436 2,557 -4.73% 10,410 10,529 -1.13%
Income before
minority
interest 4,423 4,670 -5.29% 19,070 19,498 -2.20%
Minority
interest in
income of
consolidated
subsidiary 96 (30) -420.00% (37) (153) -75.82%
Net income $4,519 $4,640 -2.61% $19,033 $19,345 -1.61%
Share Data
Actual shares
outstanding 9,975 9,810 1.68%
Basic earnings
per common
share $0.45 $0.47 -4.26% $1.92 $1.98 -3.03%
Diluted
earnings per
common share 0.44 0.46 -4.35% 1.88 1.94 -3.09%
Book value per
common share $15.61 $15.49 0.77%
Basic Average
shares
outstanding 9,959 9,810 1.52% 9,904 9,753 1.55%
Fully Diluted
average shares
outstanding 10,210 10,085 1.24% 10,112 9,949 1.64%
Dividends paid,
per share $1.20 $0.20 500.00% $1.80 $1.59 13.21%
Balance Sheet Data
(at period end)
Investment
securities $9,745 $6,362 53.18%
Loans held for
sale 4,513 10,755 -58.04%
Loans, net of
unearned
income 597,080 515,944 15.73%
Allowance for
credit losses 10,347 10,303 0.43%
Total assets 667,362 618,517 7.90%
Total deposits 420,506 387,063 8.64%
Total
Shareholders'
equity 155,694 151,940 2.47%
Selected Ratios
Return on
average
shareholders'
equity 11.53% 12.20% -5.52% 12.08% 12.72% -5.03%
Average
shareholders'
equity to
average assets 23.33% 24.18% -3.54% 24.46% 23.73% 3.09%
Return on
average total
assets 2.69% 2.95% -8.87% 2.95% 3.02% -2.10%
Net interest
spread 5.04% 5.36% -5.97% 5.18% 5.19% -0.19%
Net interest
margin 5.76% 6.00% -4.00% 5.85% 5.91% -1.02%
Efficiency
ratio - Bank
only 35.44% 46.70% -24.11% 39.26% 45.21% -13.17%
Efficiency
ratio
consolidated 57.01% 56.78% 0.40% 54.31% 54.03% 0.51%
Asset Quality Ratios
Allowance for
credit losses $10,347 $10,303 0.43%
Allowance to
ending total
Loans 1.72% 1.96% -12.08%
Non-performing Assets
Non-accrual
loans $3,169 $2,894 9.50%
90+past due
and still
accruing $78 $6,960 -98.88%
Foreclosed
real estate $5,277 $14,350 -63.23%
Non-performing
Assets to
Total Assets 1.28% 3.91% -67.36%
Net (chargeoffs)
recoveries $(331) $(1,182) -72.00%
Net loan charge-offs
(annualized) to
average loans 0.06% 0.21% -72.51%
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