First City Bancorp, Inc. reports third quarter results.MURFREESBORO Murfreesboro (mûr`frēzbûr'ə), city (1990 pop. 44,922), seat of Rutherford co., central Tenn., on Stones River; inc. 1817. It is the processing center of a dairy, livestock, and farm area. , Tenn.--(BUSINESS WIRE)--Oct. 30, 1995--First City Bancorp, Inc. (AMEX AMEX See: American Stock Exchange :FCT FCT Faculdade de Ciências e Tecnologia (Portuguese University) FCT Fundamentals of Computation Theory FCT Fundação para a Ciência e a Tecnologia (Portuguese Science and Technology Foundation) ) today announced financial results for its third quarter ended Sept. 30, 1995. Net income decreased 39.4% to $911,897, or $0.44 per share, compared with net income of $1,507,042, or $0.84 per share, reported during the first nine months of 1994. Net interest income increased 1.4% to $8,792,699 compared with $8,673,527 reported during the same period last year. The decline in net income is due to costs related to the impending im·pend intr.v. im·pend·ed, im·pend·ing, im·pends 1. To be about to occur: Her retirement is impending. 2. merger transaction, discussed below, combined with the decision approved by the Board of Directors to repay a loan of the Employee Stock Ownership Plan ("ESOP ESOP See: Employee Stock Ownership Plan ESOP See Employee Stock Ownership Plan (ESOP). ") secured by shares of common stock for which new accounting rules apply. This topic is explained more fully below. The cost related to the merger reduced 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. earnings by approximately $175,000, or $0.11 per share, for the nine months ended Sept. 30, 1995. The early repayment of ESOP loan reduced after-tax earnings by approximately $404,000, or $0.25 per share, for the same period. Net income during the third quarter of 1995 decreased 35.6% to $323,676, or $0.15 per share, compared with net income of $502,784, or $0.28 per share for the third quarter of 1994. In addition, net interest income increased 5.1% to $3,065,661 during the third quarter of 1995 compared to $2,918,100 during the third quarter of 1994. The costs related to the merger reduced after-tax earnings by approximately $175,000, or $0.10 per share, for the quarter ended Sept. 30, 1995. The compensation expense related to the Employee Stock Ownership Plan's loan reduced after-tax earnings by approximately $190,000, or $0.11 per share, for the quarter ended Sept. 30, 1995. If the Company had not incurred the compensation expense due to the early repayment of the ESOP loan and the merger costs, fully-diluted earnings per share would have been increased by $0.36 to $0.80 for the nine months ended Sept. 30, 1995, and fully-diluted earnings per share would have been increased by $0.21 to $0.36 for the quarter ended Sept. 30, 1995. At Sept. 30, 1995, total assets were approximately $347.6 million, an increase of approximately $17.2 million from a year ago. 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 approximately $20.3 million. Deposits at Sept. 30, 1995, amounted to approximately $300.9 million, up from $286.3 million a year ago. Loans at Sept. 30, 1995, totaled approximately $172.7 million as compared to approximately $157.6 million at Sept. 30, 1994. First City Bancorp's continuing commitment to superior asset quality is shown by the fact that, at Sept. 30, 1995, 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. as a percentage of total loans was only 0.25%, and non-performing assets as a percentage of total assets was only 0.15%. The capital accounts at Sept. 30, 1995, reflect an after-tax unrealized loss Unrealized Loss A loss that results from holding onto an asset rather than cashing it in and officially taking the loss. Notes: Let's say you own a stock that is down 50%, but you haven't sold it to realize the loss yet. This is said to be an unrealized loss. in the available for sale securities portfolio of $754,928 compared to a $2,148,344 after-tax unrealized loss in the account at Dec. 31, 1994. Since Dec. 31, 1994, the available for sale securities portfolio has increased in market value as a result of a decline in market interest rates and the shortening of the average lives of the amortized securities as the payment speeds increase and as the final maturity dates of the securities in the portfolio become closer. Management also took steps during the second quarter to divest To deprive or take away. Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. its holdings in some of the securities that were considered undesirable in the current investment market. This divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). resulted in net after-tax loss of approximately $12,000 during the second quarter. The proceeds from the sale of these securities were reinvested in higher yield securities with shorter lives. As referred to above, new accounting requirements became effective during 1994 for leverage Employee Stock Ownership Plans (ESOP's) which had acquired shares of the sponsor's common stock after Dec. 31, 1992. First City Bancorp's ESOP shares acquired in 1993 are subject to these new accounting provisions. These provisions require that, as First City makes contributions to the ESOP to repay the ESOP's debt, the Company must recognize compensation expense based on the fair market value of the common shares that are committed to be released by the contribution, ratably over the period of time ESOP participants perform services. After reviewing the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. potential impact of these new accounting requirements, the Board of Directors determined to repay a $544,000 loan relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the shares acquired in 1993 during 1995. This loan was paid off during the third quarter of 1995. The additional compensation expense that is being recognized as a result of the prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. of this loan is being prorated over each quarter of 1995. The net after-tax expense for the first nine months of 1995, as a result of the acceleration of the ESOP debt payment, amount was approximately $404,000. There will probably be large increases in compensation expense for the fourth quarter of 1995, the amount of which will be dictated dic·tate v. dic·tat·ed, dic·tat·ing, dic·tates v.tr. 1. To say or read aloud to be recorded or written by another: dictate a letter. 2. a. by the average market price of First City Bancorp's common stock during that quarter. First City Bancorp, Inc. is a bank holding company whose subsidiaries includes First City Bank and Citizens Bank. First City Bank is a Tennessee Tennessee, state, United States Tennessee (tĕn`əsē', tĕn'əsē`), state in the south-central United States. state-chartered bank headquartered in Murfreesboro and also has locations in Smyrna Smyrna, city, United States Smyrna, city (1990 pop. 30,981), Cobb co., NW Ga., a residential suburb of Atlanta; inc. 1872. Manufactures include computer equipment, building materials, plastics, ordnance, and chemicals. , Nashville and Columbia. Citizens Bank is also a Tennessee state-chartered bank headquartered in Smithville with additional locations in Ardmore and Elkton. In addition, Tennessee Credit Corporation, a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of First City Bank, is a consumer finance company with offices in Murfreesboro, Lebanon, Dickson, Cookeville, Nashville, Franklin, Lewisburg, Tullahoma and McMinnville. First City Bancorp, Inc., entered into a definitive agreement on July 5, 1995 to merge with First American Corporation
Officially referred to as The First American Corporation (FAC) , (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 :FATN) of Nashville, Tenn. The transaction is expected to be completed during the first quarter of 1996. -0-
First City Bancorp, Inc.
Unaudited Financial Highlights
Nine Months Ended Quarter Ended
September 30, September 30,
1995 1994 1995 1994
Total interest income $19,229,942 $16,157,984 $ 6,606,154 $ 5,638,393 Total interest expense 10,437,243 7,484,457 3,540,493 2,720,293 Net interest income 8,792,699 8,673,527 3,065,661 2,918,100 Provision for possible loan losses 241,474 424,475 94,132 127,651 Income after provision for possible loan losses 8,551,225 8,249,052 2,971,529 2,790,449 Total non-interest income 2,444,612 2,156,739 823,990 679,654 Total non-interest expense 9,425,024 8,156,628 3,116,158 2,704,708 Income before income taxes 1,570,813 2,249,163 679,361 765,395 Income tax expenses 658,916 742,121 355,685 262,611 Net income $ 911,897 $ 1,507,042 $ 323,676 $ 502,784 Weighted average primary common stock equivalents outstanding 1,483,731 1,420,666 1,568,589 1,423,088 Primary earnings per common share equivalent $ 0.44 $ 0.89 $ 0.15 $ 0.30 Weighted average fully diluted common stock equivalents outstanding 1,648,901 1,586,465 1,733,709 1,588,923 Fully diluted earnings per common share equivalent $ 0.44 $ 0.84 $ 0.15 $ 0.28
September 30,
1995 1994
Total assets $347,606,255 $330,397,787
Loans, net $172,652,851 $157,604,605
Deposits $300,920,092 $286,251,219
Shareholders' equity $ 20,303,676 $ 17,009,494
CONTACT: First City Bancorp, Inc., Murfreesboro William E. Rowland, 615/898-1111 or First City Bank, Murfreesboro Robert B. Murfree, 615/898-1111 |
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