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NEW HORIZONS EARNS $839,000, OR 38 CENTS PER SHARE, IN SECOND QUARTER; NON-PERFORMING ASSETS DECLINE 36 PERCENT TO 1.94 PERCENT OF TOTAL ASSETS

 SAN RAFAEL, Calif., July 20 /PRNewswire/ -- New Horizons Savings and Loan Association (NASDAQ: NHSL) today reported it earned $839,000 or $.38 per share for the second quarter ended June 30, 1993 compared to $912,000 or $.41 per share for the like quarter a year ago. Non- performing assets declined 36 percent to $5.6 million compared with $8.8 million a year ago. The ratio of non-performing assets to total assets improved substantially to 1.94 percent compared to 3.79 percent a year ago.
 For the first half of 1993, New Horizon's net income totaled $1.63 million or $.74 per share. In the like period a year ago, when a change in an accounting principle boosted net income by $375,000 or $.17 per share, New Horizons' net income was $1.97 million or $0.90 per share.
 "We are achieving our goal of producing more profitable business. This year we tightened our loan underwriting standards considerably and held the line on interest rates," said James Barnett, chairman and chief executive officer. "As a result, loan originations were scaled back from the $29.6 million generated in the second quarter of 1992 to $14 million this quarter.
 "The combination of applying stricter underwriting standards and building higher reserves is part of the overall strategy we adopted to manage risk in our loan portfolio," Barnett added. New Horizons provided $285,000 for losses on loans and real estate owned during the second quarter, boosting the association's ratio of loss allowance to total assets to 1.52 percent, an 83 percent increase above last year's level. The ratios measuring loss allowance to both total assets and non-performing assets are now better than the industry's national average.
 New Horizons' net interest income, after provision for loan losses, which is a basic measure of bank profitability, increased 16 percent to $3 million for the second quarter ended June 30, 1993, from $2.6 million for the second quarter of 1992. An increase in interest earning assets to $278.7 million at the end of June from $214.4 million a year ago helped boost net interest income even through the association's interest rate spread decreased over the past 12 months. New Horizons' interest rate spread fell to 4.15 percent for the second quarter of 1993 from 4.74 percent in the second quarter a year ago. The interest rate spread is the difference between what the bank earns on its loans and investments and what it pays for deposits and borrowings.
 Total non-performing assets, including real estate owned through foreclosure, totaled $5.6 million, or 1.94 percent of assets at the end of June compared to $8.8 million, or 3.79 percent of assets at June 30, 1992. Non-accrual loans and loans more than 90 days past due fell to $5.4 million at June 30, 1993 from $8.4 million at June 30, 1992.
 General and administrative expense totaled $1.4 million, which is well below New Horizons' $3.0 million net interest income, before provision for possible loan losses. Other expenses totaled $253,000 in the quarter ended June 30, 1993 compared to other income of $77,000 in the like quarter a year ago. The $300,000 provision taken for losses on real estate exceeded fees and other income generated during the current quarter.
 New Horizons' assets totaled $286.6 million at June 30, 1993 compared to $232.7 million a year ago. Shareholders' equity stood at $20.7 million and tangible book value was $9.44 per share at June 30, 1993. New Horizons' tangible capital ratio is 7.22 percent and its risk-based capital ratio is 13.03 percent, both well above regulatory minimums.
 New Horizons Savings is a two-branch institution headquartered in Marin County, Calif. New Horizons operates in San Francisco and the counties north of the Golden Gate Bridge. The core of New Horizon's business, providing customized loans for homes and for home construction, is a market niche that most of the major banks in Northern California have vacated.
 NEW HORIZONS SAVINGS AND LOAN ASSOCIATION
 FINANCIAL HIGHLIGHTS
 (Unaudited)
 Second Quarter Ended Six Months Ended
 June 30, June 30,
 1993 1992 1993 1992
 Interest income $5,852,126 $5,377,096 $11,521,476 $10,642,483
 Interest expense 2,822,973 2,645,535 5,643,881 5,557,276
 Net interest income
 after provision
 for losses
 on loans 3,044,153 2,632,561 5,742,595 4,764,922
 Other operating
 (expense)income (253,337) 77,155 (251,244) 232,587
 General and
 administrative
 expense 1,359,932 1,120,902 2,712,917 2,224,586
 Income tax 591,582 676,798 1,144,077 1,174,120
 Cumulative effect
 of change in
 accounting
 principle 0 0 0 375,206
 Net income 839,302 912,016 1,634,357 1,974,009
 Earnings per share 0.38 0.41 0.74 0.90
 Weighted average
 shares
 outstanding 2,199,417 2,199,417 2,199,417 2,199,417
 June 30, 1993 December 31, 1992 June 30, 1992
 Total assets $286,584,775 $274,441,831 $232,722,454
 Loans 245,282,523 234,747,941 205,136,645
 Deposits 222,647,126 207,476,817 190,742,659
 Shareholders'
 equity 20,693,416 19,059,059 19,782,239
 Tangible book value
 per share 9.44 8.69 9.02
 -0- 7/20/93
 /CONTACT: Jim Barnett, chairman and chief executive officer, of New Horizons Savings, 415-457-6990/
 (NHSL)


CO: New Horizons Savings and Loan Association ST: California IN: FIN SU: ERN

JH -- SE008 -- 6575 07/20/93 08:42 EDT
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Date:Jul 20, 1993
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