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HORIZON BANK REPORTS THIRD-QUARTER EARNINGS INCREASE 23 PERCENT

 BELLINGHAM, Wash., Jan. 19 /PRNewswire/ -- Horizon Bank (NASDAQ: HRZB) announced that earnings for the third quarter ended Dec. 31 increased 23 percent over results for the same period one year ago.
 V. Lawrence Evans, president, announced that net income for the quarter rose 23 percent to $1.76 million, or 35 cents per share, up from $1.44 million and 29 cents per share for the same quarter one year ago. Net income for the nine months rose 21 percent to $5.15 million, or $1.03 per share, up from $4.24 million and 86 cents per share.
 Total revenue for the quarter rose to $8.90 million, up from $8.62 million last year, including interest income of $8.46 million versus $8.30 million. Total revenue for the nine months rose to $26.37 million, up from $25.85 million, including interest income of $25.21 million versus $24.79 million.
 "The continued favorable interest rate environment had a very positive impact on the bank's profitability," commented Evans. For both the third quarter and nine months of the fiscal year, Horizon Bank achieved a return on assets (ROA) of 1.83 percent. This marks the 10th consecutive quarter for which the bank's ROA was above 1.50 percent. In a business where a 1.00 percent ROA is considered the benchmark of solid performance, this achievement is a testament to the bank's consistent profitability.
 Loan demand in the bank's three-county market attained record levels, with total loan volume for the quarter up 77 percent to $45.1 million, compared to $25.4 million for the same quarter last year. The pace for the year has been heavy as well with a record $113.3 million in total loans for the nine months ended Dec. 31, up 50 percent from $75.5 million one year ago. Not reflected in these totals are over $27.9 million in loan modifications -- existing portfolio loans that were also refinanced.
 Horizon Bank continues to focus on maintaining asset quality, and the bank's nonperforming assets remain extremely low. For the second time in seven quarters, on Dec. 31, 1992, Horizon Bank had no nonperforming loans, or 0.00 percent of assets. This compares quite favorably with the Washington state savings bank average of 1.51 percent and the national average of 4.04 percent.
 Deposits for the period rose to $321.9 million, and stockholders' equity rose to $57.6 million, or 14.93 percent of assets.
 During the quarter, Horizon Bank implemented an accrual to help cover the cost of complying with the Financial Accounting Standards Board (FASB) ruling No. 109. This ruling deals with the accounting for income taxes and becomes effective with the fiscal year ending March 31, 1993.
 Also during the quarter, the bank declared a cash dividend of 8 cents per share payable Jan. 29 to stockholders of record Jan. 7. The bank is also pleased to announce the availability of its new Dividend Reinvestment and Stock Purchase Plan beginning Jan. 29. The plan provides participants with a simple and convenient method of reinvesting cash dividends and investing optional cash payments for additional shares of common stock.
 Horizon Bank is a $386-million, state-chartered, FDIC-insured savings bank. Located in the northwestern corner of Washington state, the bank has nine offices serving Whatcom, Skagit and Snohomish counties.
 HORIZON BANK
 SELECTED FINANCIAL HIGHLIGHTS
 Three Months Nine Months
 Ended Dec. 31: 1992 1991 1992 1991
 Interest income $8,460,364 $8,303,634 $25,210,819 $24,788,562
 Interest expense 4,054,858 4,684,835 12,514,794 14,326,164
 Net interest
 income 4,405,506 3,618,799 12,696,025 10,462,398
 Provision for
 loan losses (19,820) 229,750 (5,935) 489,750
 Net interest income
 after provision
 for loan losses 4,425,326 3,389,049 12,701,960 9,972,648
 Non-interest income 442,240 317,752 1,158,485 1,063,794
 Non-interest
 expense 1,673,165 1,609,564 5,341,573 4,839,760
 Income before
 provision for
 income taxes 3,194,401 2,097,237 8,518,872 6,196,682
 Provision for
 income taxes 1,133,880 660,630 3,069,360 1,951,956
 Net income before
 cumulative effect
 of change in
 accounting
 principle 2,060,521 1,436,607 5,449,512 4,244,726
 Cumulative effect
 of partial
 implementation
 of FASB No. 109 300,000 -- 300,000 --
 Net income 1,760,521 1,436,607 5,149,512 4,244,726
 Earnings per
 share $ 0.35 $ 0.29(A) $ 1.03 $ 0.86(A)
 Weighted average
 shares
 outstanding 4,987,510 4,931,957(A) 4,976,460 4,929,329(A)
 Return on assets
 (percents) 1.83 1.65 1.83 1.66
 Return on equity
 (percents) 12.39 11.19 12.37 11.24
 Interest rate spread
 (percents) 4.13 3.59 4.01 3.43
 Net interest margin
 (percents) 4.77 4.35 4.70 4.26
 At Dec. 31, At March 31,
 1992 1992
 Assets $385,684,451 $363,275,013
 Loans Receivable, net 318,000,027 291,050,845
 Nonperforming loans 0 23,627
 Loan loss reserve 2,211,677 2,217,612
 Deposits 321,932,330 303,322,760
 Stockholders' equity 57,597,426 53,387,410
 Stockholders' equity-to-assets
 (percents) 14.93 14.70
 Stockholders' equity-to-deposits
 (percents) 17.89 17.60
 Total shares outstanding 5,011,548 4,966,971(A)
 Book value per share $ 11.49 $ 10.75(A)
 NOTE (A) Restated for 5-for-4 stock split declared June 23, 1992.
 -0- 1/19/93
 /CONTACT: V. Lawrence Evans, president, or David Eldred, Investor Relations, of Horizon Bank, 206-733-3050/
 (HRZB)


CO: Horizon Bank ST: Washington IN: FIN SU: ERN

SW -- SE002 -- 6149 01/19/93 08:51 EST
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