Community Bancorp Inc. Announces Second Quarter Earnings With a 56% Year to Date Increase Over 1998.FALLBROOK, Calif.--(BUSINESS WIRE)--July 14, 1999-- Community Bancorp Inc. (Nasdaq:CMBC CMBC Coast Mountain Bus Company (Surrey, BC, Canada) CMBC Canadian Mennonite Bible College CMBC Camp Memorial Blood Center (US Army) CMBC Castle Morpeth Bridge Club (UK) ), parent company of Fallbrook National Bank, today announced earnings of $382,000, or $0.16 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 second quarter of 1999, compared to $184,000, or $0.08 per diluted share, for the second quarter of 1998. Net income totaled $735,000, or $0.31 per diluted share, for the six months ended June June: see month. 30, 1999 compared to $471,000, or $0.19 per diluted share, for the six months ended June 30, 1998. This resulted in a 56 percent increase in the first six months of 1999 compared to the first six months of 1998, and brings the four quarter trailing earnings Trailing earnings Past earnings. Often used in the context of the price earnings ratio. This ratio is usually distinguished as price to trailing earnings (today's price divided by the most recent 12 months of earnings) versus price to prospective earnings (today's price divided by to $0.66 per diluted share. "During 1998 we spent the money to build the infrastructure for earnings growth, and we are pleased that the company's efforts have been so well rewarded," said Tom Swanson, president and chief executive officer of Community Bancorp Inc. "The formation of the holding company, Community Bancorp Inc., sets the stage for future diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. , while the listing on the Nasdaq national markets should assist in developing a more liquid market for the company's stock." The company's total assets increased to $155.6 million as of June 30, 1999, compared to $136.2 million as of Dec. 31, 1998, for a 28 percent annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. growth rate. Earnings for the second quarter of 1999 were negatively impacted by the one time expense of forming the holding company. "Without the holding company formation, earnings per share would have been $0.18 instead of $0.16 for the second quarter, and the four quarter trailing earnings would have been $0.68 instead of $0.66," continued Swanson. "While we are achieving excellent growth in both earnings and total assets, as well as being a well capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. bank by all regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. measures, we have not sacrificed asset quality to achieve these goals. Non-performing assets are less than 50% of what they were a year ago, and net charge offs have dropped to only 4 basis points for the first half of 1999, compared to 30 basis points for the first half of 1998." Community Bancorp Inc., parent company of Fallbrook National Bank, is a $156 million bank holding company headquartered in Fallbrook, Calif. The company's primary subsidiary, Fallbrook National Bank, serves the North San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. and Inland Empire In·land Empire A region of the northwest United States between the Cascade Range and the Rocky Mountains, comprising eastern Washington, eastern Oregon, northern Idaho, and western Montana. Farming, lumbering, and mining are important to the area. communities with retail banking offices in Fallbrook, Temecula and Vista, and loan production offices in the cities of Fallbrook, Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , Ontario Ontario, city, United States Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. , Orange, Sacramento Sacramento, city, United States Sacramento (săkrəmĕn`tō), city (1990 pop. 369,365), state capital and seat of Sacramento co., central Calif. , Temecula, and Vista. Fallbrook National Bank's Web site is www.fallbrooknationalbank.com. Statements concerning future performance, developments or events concerning expectation for growth and market forecasts, and any other guidance on future periods, constitute 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 a number of risks and uncertainties which might cause actual results to differ materially from stated expectations. -0-
STATEMENTS OF INCOME
(dollars in thousands)
(unaudited)
For the six months For the three months
ended ended
June 30, June 30,
1999 1998 1999 1998
Interest Income:
Interest and
fees on loans $ 5,841 $ 4,512 $ 3,003 $ 2,365
Interest on
federal funds
sold 233 436 170 213
Interest on
interest bearing
deposits in
financial
institutions 20 21 10 11
Interest on
investment
securities 62 25 20 15
Total interest
income 6,156 4,994 3,203 2,604
Interest expense
-- deposits 1,854 1,712 985 888
Interest expense
-- other borrowed
money 43 60 21 30
Total interest
expense 1,897 1,772 1,006 918
Net interest
income before
provision for
loan losses 4,259 3,222 2,197 1,686
Provision for
loan losses 315 231 165 141
Net interest
income after
provision for
loan losses 3,944 2,991 2,032 1,545
Other operating
income:
Customer service
charges 178 179 96 92
Other fee income 665 462 362 195
Gain on sale of
loans 1,713 593 849 448
Servicing fees,
net 270 419 107 215
Total other
operating
income 2,826 1,653 1,414 950
Other operating
expenses:
Salaries and
employee
benefits 3,145 2,105 1,574 1,106
Occupancy 554 357 283 194
Bank premises
and equipment 243 144 119 78
Marketing and
promotions 114 136 55 93
Data processing 362 282 181 136
Professional
services 237 173 130 130
Other expenses 864 644 455 443
Total other
operating
expenses 5,519 3,841 2,797 2,180
Income before
taxes 1,251 803 649 315
Income taxes 516 332 267 131
Net income $ 735 $ 471 $ 382 $ 184
Basic earnings
per share $ 0.32 $ 0.21 $ 0.17 $ 0.09
Diluted earnings
per share $ 0.31 $ 0.19 $ 0.16 $ 0.08
CONSOLIDATED BALANCE SHEETS
At June 30, 1999 and Dec. 31, 1998
(dollars in thousands)
(Unaudited)
ASSETS June 30, 1999 Dec. 31, 1998
Cash and due from banks $ 8,424 $ 6,064
Federal funds sold 20,760 10,250
Interest bearing deposits
in financial institutions 800 800
Federal Reserve Bank stock 161 132
Investment securities
held-to-maturity, at amortized
cost 5,907 1,676
Loans 111,992 109,701
Less allowance for loan
losses (1,286) (992)
Net loans 110,706 108,709
Bank premises and equipment, net 2,496 2,460
Accrued interest and other assets 3,584 3,182
Servicing asset, net 2,770 2,950
Total assets $ 155,608 $ 136,223
LIABILITIES AND SHAREHOLDERS'
EQUITY
Deposits
Interest bearing $ 114,339 $ 102,869
Non-interest bearing 25,583 21,286
Total deposits 139,922 124,155
Other Borrowings 4,073 1,000
Accrued expenses and other
liabilities 1,215 1,522
Total liabilities 145,210 126,677
Shareholders' equity
Common stock, $ .625 par value;
authorized 40,000,000 shares,
issued and outstanding,
2,411,685 at June 30, 1999 and
2,407,065 at Dec. 31, 1998 1,507 1,505
Additional paid-in capital 3,869 3,856
Unearned ESOP contribution (898) (1,000)
Retained Earnings 5,920 5,185
Total shareholders' equity 10,398 9,546
Total liabilities and
shareholders' equity $ 155,608 $ 136,223
Community Bancorp Inc.
Financial Highlights
FINANCIAL RATIOS:
For the six For the quarter
months ended ended
June 30, June 30,
1999 1998 1999 1998
Return on average
assets 1.04% 0.86% 1.03% 0.64%
Return on average
equity 14.79% 11.09% 14.97% 8.57%
Efficiency ratio 77.90% 78.79% 77.46% 82.70%
Net interest margin 6.67% 6.40% 6.57% 6.41%
Average equity to
average assets 7.01% 7.71% 6.86% 7.46%
ALLOWANCE FOR LOAN LOSSES:
At or for the six months ended
June 30,
1999 1998
(dollars in thousands)
Balance beginning of year $ 992 $ 650
Provision for loan losses 315 231
Net charge offs (net recoveries) 21 127
Balance end of period $ 1,286 $ 754
Allowance for loan losses to
nonaccrual loans 120.07% 425.99%
Allowance for loan losses to
nonperforming loans 120.07% 55.20%
Total Gross Loans $114,003 $ 93,115
Allowance for loans losses
to total gross loans 1.13% 0.81%
Allowance for loan losses to
nonperforming assets 120.07% 34.26%
Ratio of net charge-offs to
average loans outstanding
(annualized) 0.04% 0.30%
NON-PERFORMING ASSETS:
At June 30, At Dec. 31,
1999 1998 1998
(dollars in thousands)
Total nonaccrual loans1 $1,071 $ 177 $ 969
Troubled debt restructurings -- 724 723
Loans 90 days past due and
still accruing -- 465 203
Total nonperforming
loans 1,071 1,366 1,895
Other real estate owned -- 835 --
Total nonperforming assets $1,071 $2,201 $1,895
Nonaccrual loans to total
gross loans 0.94% 0.19% 0.86%
Nonperforming loans to total
gross loans 0.94% 1.47% 1.68%
Nonperforming loans, net of
SBA guarantees, to
total gross loans 0.79% 1.28% 1.42%
Total nonperforming assets to
total assets 0.69% 1.81% 1.39%
1 Includes $166,000, $177,000 and $293,000 in SBA guaranteed
portion of nonperforming loans as of June 30, 1999 and 1998 and
Dec. 31, 1998, respectively.
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