State Bancorp, Inc. Reports First Quarter Earnings.NEW HYDE PARK New Hyde Park, village (1990 pop. 9,728), Nassau co., SE N.Y., on Long Island; inc. 1927. It is a residential community with some manufacturing and truck farms. Nearby is the uninc. town of North New Hyde Park (1990 pop. 14,359). , N.Y. -- The Board of Directors of State Bancorp, Inc. (AMEX AMEX See: American Stock Exchange - STB See set-top box. STB - set-top box ), parent company of State Bank of Long Island, today reported earnings for the three months ended March 31, 2005. Earnings for the first quarter of 2005 declined by 32.0% when compared to 2004 due to a significant reduction in net security gains coupled with growth in total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and the provision for probable PROBABLE. That which has the appearance of truth; that which appears to be founded in reason. loan losses during 2005. Somewhat offsetting these negative factors were improvements in several core business elements, most notably net interest income, and income from bank owned life insurance. Financial performance details for the March 2005 year to date period are as follows: --Net income totaled $2.6 million, down 32.0% versus the comparable 2004 period; --Net security gains (before taxes) declined by $2.5 million in the first quarter of 2005; --Diluted earnings per common share(1) were $0.28 in 2005, down 33.3% from the $0.42 earned in 2004; --Returns on average assets and stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. were 0.71% and 10.50%, respectively, in 2005 and 1.09% and 16.12% in 2004; --Average loans outstanding increased by 11% to $786 million; --Average core deposits grew by 8% to $1.0 billion; --Net interest margin improved to 4.29% in 2005 from 4.02% in 2004; and --Tier I leverage capital ratio increased to 8.04% in 2005 versus 7.85% in 2004. --Nonaccrual loans declined to $5 million (0.6% of loans outstanding) at March 31, 2005 versus $7 million (0.7%) at March 31, 2004 Earnings Summary for the Quarter Ended March 31, 2005 Net interest income grew by $1.5 million (up 11.4%) to $14.7 million in 2005 as the result of a 5% increase in average interest-earning assets, primarily loans. Growth in commercial loans, commercial mortgages, installment loans Noun 1. installment loan - a loan repaid with interest in equal periodic payments installment credit consumer credit - a line of credit extended for personal or household use loan - the temporary provision of money (usually at interest) and leases resulted in an 11% increase in average loans outstanding to $786 million during 2005 versus 2004. The investment portfolio contracted by 3% to $546 million, principally due to declines in mortgage-backed Mortgage-backed may refer to:
Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. tax-exempt tax-ex·empt adj. 1. Not subject to taxation, as the capital or income of a philanthropic organization. 2. Producing interest that is exempt from income tax: tax-exempt bonds. n. municipal securities. Funding the growth in interest-earning assets was a 6% increase in average total deposits. Driving the deposit growth was an 8% increase in core deposit balances (demand, savings, money fund and Super NOW deposits) which rose by $72 million in 2005. Core deposit balances, which have grown significantly over the past several years, provide low-cost funding (average cost of 97 basis points in 2005) that has allowed the Company to reduce its dependence on higher-cost CDs. The Company's fully taxable equivalent (FTE FTE Full-Time Equivalent FTE Full-Time Employee FTE Full-Time Equivalency FTE Full Time Employment FTE Foundation for Teaching Economics FTE Full Time Enrollment FTE For the Enterprise (SQL) FTE Fund for Theological Education ) net interest margin expanded to 4.29% during the first quarter of 2005 from 4.02% a year ago. This improvement resulted primarily from a 76 basis point increase in the Company's FTE yield on interest-earning assets, principally due to growth in the loan portfolio in 2005. This widening of the earning-asset yield was offset somewhat by a 49 basis point increase in the Company's cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. to a weighted rate of 1.34% in the March 2005 year to date period. The higher cost of funds resulted from the impact of increases in short-term interest rates Short-term interest rates Interest rates on loan contracts-or debt instruments such as Treasury bills, bank certificates of deposit or commerical paper-having maturities of less than one year. Often called money market rates. experienced during the past nine months. The provision for probable loan losses increased by 13.9% to $1.2 million during the first quarter of 2005 as a result of continued growth in the loan and lease portfolio and the resulting possibility of increased losses inherent in that growth. Noninterest income declined by 67.2% to $1.2 million principally the result of a reduction in net security gains. Service charges on deposit accounts declined by 11.1% due to improved management of balances by corporate customers which resulted in lower overdraft A check that is drawn on an account containing less money than the amount stated on the check. The term overdraft is also used in reference to the condition that exists when vouchers charges. Income from bank owned life insurance increased by $123 thousand in 2005 versus last year due to the timing of this asset purchase during the middle of 2004's first quarter. 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. decreased by 7.8% as the result of reductions in letter of credit and foreign exchange fees during 2005. Net security gains totaled $103 thousand in 2005 versus $2.6 million in 2004. Sales of 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. municipal notes during the first quarter of 2004, undertaken as a result of the decline in interest rates, produced last year's gains. Total operating expenses increased by 9.0% to $11.2 million during 2005 when compared to last year. The principal reasons for this growth were increases in salaries and benefits, occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy , legal, marketing, audit and assessment and other operating expenses. Salaries and benefits (up 8.6%) rose as the result of growth in staff coupled with higher medical and pension costs. The increase in staff results primarily from the establishment of a Professional Services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. Group ("PSG PSG, n polysomnograph; polygraph performed during sleep. Physiological variables such as pulse, blood pressure, and respiration are monitored and charted. ") in May 2004 and the addition of several lending officers in early 2005. Occupancy costs Occupancy costs are the whole life costs of buildings and their associated land from occupancy until disposal. These costs may be incurred on a regular or irregular basis. Occupancy costs are those costs related to occupying a space including; rent, real estate taxes, personal increased by 28.1% to $1.3 million as the result of several factors: most notably additional office space in our County Seat location and in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , primarily for PSG; higher utility costs; and increased maintenance costs related to snow removal in 2005. Legal expenses increased during 2005 as the result of an increase in costs at the Bank's leasing subsidiary. Legal expenses associated with ongoing litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. previously disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). in the Company's filings with the Securities and Exchange Commission, related to the Company's relationship with Island Mortgage Network, a former deposit customer, and its affiliates ("IMN IMN Iraqi Media Network IMN Indicated Mach Number IMN Inter Member Network IMN Infectious Mononucleosis IMN Invisible Moose Network (website) IMN Illegal Macro Name IMN Internet Marketing Newsletter ") for the first quarter of 2005 were comparable to those incurred during the first quarter of 2004. The Company continues to defend the remaining two IMN lawsuits vigorously vig·or·ous adj. 1. Strong, energetic, and active in mind or body; robust. See Synonyms at healthy. 2. Marked by or done with force and energy. See Synonyms at active. . Management believes that it has substantial defenses to the claims that have been asserted; however, the ultimate outcome of these lawsuits cannot be predicted with certainty CERTAINTY, UNCERTAINTY, contracts. In matters of obligation, a thing is certain, when its essence, quality, and quantity, are described, distinctly set forth, Dig. 12, 1, 6. It is uncertain, when the description is not that of one individual object, but designates only the kind. Louis. . The Company expects to continue to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. costs related to the IMN litigation during the remainder of 2005. Marketing and advertising expenses increased by 25.4% due to higher costs associated with various Bank product promotions. Audit and assessment expenses increased significantly (up 99.8%) due solely to costs required to comply with the Sarbanes-Oxley Act See SOX. of 2002. Somewhat offsetting the foregoing cost increases were improvements in several expense categories. Equipment expenses declined by 11.2% as the result of lower depreciation and equipment maintenance costs. Credit and collection fees declined by 40.1% due to the continued reduction in the number and amount of nonperforming assets Nonperforming asset An asset that is not effectively producing income, such as an overdue loan. nonperforming asset An asset that produces no income. in 2005. Other operating expenses decreased by 3.2% during 2005 to $1.4 million as the result of the final amortization of costs associated with previously opened branches during the fourth quarter of 2004. The foregoing expense factors resulted in an operating efficiency ratio of 68.9% in 2005 versus 70.3% in 2004. Income tax expense declined by $801 thousand in 2005 versus the year ago period. The Company's effective tax rate was 24.8% in 2005 and 30.1% in 2004. Commenting on the 2005 performance, Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs F. Goldrick, Jr. stated, "Although net income declined during the first quarter of 2005, we remain very encouraged by several of the underlying trends masked A state of being disabled or cut off. by the earnings shortfall Shortfall The amount by which the capital required to fulfill a financial obligation exceeds available capital. Notes: Shortfall risk is often combated with an efficient hedging strategy created by a fund, group, institution, or individual. . The year over year reduction in earnings results principally from a lower level of net security gains in 2005. Significant security gains were recorded during the first quarter of 2004 as the result of sales prompted by the expectation of an increase in interest rates during that period. Excluding the reduction in net security gains in 2005, we are able to point out several positive factors that occurred during the first quarter of this year: continued expansion of the Company's loan and lease portfolio (up 11%) coupled with positive trends in major credit quality indicators, ongoing growth of core deposit balances (up 8%) and a 27 basis point widening of the net interest margin to 4.29% in 2005. Low-cost core deposits funded 71% of the Company's average interest-earning assets during the first quarter of 2005 versus 69% a year ago. We look forward to the opening of our sixteenth branch later this year in Westbury Westbury, residential village (1990 pop. 13,060), Nassau co., SE N.Y., on Long Island; settled 1650, inc. 1932. The State Univ. of New York's Westbury campus is located in the village. Harness races are held at Roosevelt Raceway there. and we expect that it will contribute to continued core deposit growth in the coming years. We are also hopeful that these very positive trends will continue as businesses, municipalities and retail consumers continue to seek out a high quality, community-based institution as their financial services 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. partner." Mr. Goldrick also noted, "While we are encouraged by the nominal Trifling, token, or slight; not real or substantial; in name only. Nominal capital, for example, refers to extremely small or negligible funds, the use of which in a particular business is incidental. NOMINAL. Relating to a name. improvement in our operating efficiency ratio during the first quarter of the year, we remain committed to lowering this ratio to a level commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. with our high-performing industry peers. Investments in staff, facilities and technology necessary for the future growth of the Company have resulted in near term cost increases that we are confident will yield substantial dividends in future periods. We will continue to vigilantly pursue cost containment cost containment, n the features of a dental benefits program or of the administration of the program designed to reduce or eliminate certain charges to the plan. and revenue enhancement revenue enhancement An increase in revenues, especially by way of increased taxes. Revenue enhancement includes reducing taxpayer deductions and eliminating tax credits. initiatives that will lower the efficiency ratio during the balance of 2005 and beyond." Allowance for Probable Loan Losses As of March 31, 2005, the Company's allowance for probable loan losses amounted to $13 million or 1.62% of period-end loans outstanding. The allowance as a percentage of loans outstanding was 1.54% at December December: see month. 31, 2004 and 1.58% at March 31, 2004. The allowance as a percentage of nonaccrual loans improved to 262% at March 31, 2005 versus 228% at December 31, 2004 and 159% at March 31, 2004. Net charge-offs for the first three months of 2005 and 2004 were $133 thousand and $576 thousand, respectively. As a percentage of average total loans outstanding, these charge-off Eliminate or write off. The term charge-off is used to describe the process of removing from the records of a company something that was once regarded as an asset but has subsequently become worthless. totals represented 0.07% and 0.33% in 2005 and 2004, respectively. Based upon historical trends and the uncertain nature of the current economy, management anticipates further loan charge-offs during the remainder of 2005. Nonperforming Assets Nonperforming assets, defined by the Company as nonaccrual loans and other real estate owned Real Estate Owned Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most ("OREO"), amounted to $8 million at March 31, 2005, versus $8 million at December 31, 2004 and $10 million at March 31, 2004. Nonaccrual loans totaled $5 million (0.6% of loans outstanding) at March 31, 2005, $5 million (0.7% of loans outstanding) at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. 2004 and $7 million (1.0% of loans outstanding) at March 31, 2004. The reduction in nonperforming assets at March 31, 2005 versus the comparable 2004 date resulted from aggressive workout Workout Informal repayment or loan forgiveness arrangement between a borrower and creditors. workout 1. The process of a debtor's meeting a loan commitment by satisfying altered repayment terms. , collection and charge-off efforts during the past year. The Company held one commercial OREO property carried at $3 million at both quarter-end 2005 and 2004. Management continues to anticipate that this property will be sold with no material impact on the Company's income statement. Capital Total stockholders' equity was $100 million at March 31, 2005, up 1.6% when compared to the comparable 2004 date. The Company also holds $20 million in trust preferred securities that qualify as Tier I capital for 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. capital purposes. Each of the Company's trust preferred securities bears an interest rate tied to three-month LIBOR LIBOR See: London Interbank Offered Rate LIBOR See London interbank offered rate (LIBOR). and is redeemable Redeemable Eligible for redemption under the terms of an indenture. by the Company in whole or in part after five years or earlier under certain circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . During the first three months of 2005, the weighted average rate on the Company's trust preferred securities was 5.74% versus 4.31% a year ago. State Bancorp, Inc.'s Tier I leverage ratio was 8.04% and 7.85% at March 31, 2005 and 2004, respectively. This ratio is well in excess of current regulatory guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. for a well-capitalized institution. The Company's Tier I and Total Risk-Based capital ratios Risk-based capital ratio Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset. were 12.54% and 13.79%, respectively, at March 31, 2005. During the first quarter of 2005, the Company distributed $1.4 million in cash dividends on its common stock, representing a payout ratio Payout Ratio The percentage of earnings paid out in dividends. It is calculated by dividing dividends per share by earnings per share. Notes: The payout ratio indicates how well earnings support the dividend payments: the lower the ratio, the more secure the dividend. of 51.7%. The Company did not repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. any of its common stock during the first quarter of 2005. Since 1998, a total of 925,995 shares of Company stock have been repurchased at an average cost of $16.70 per share. Under the Board of Directors' existing authorization The right or permission to use a system resource; the process of granting access. See access control. , an additional 574,005 shares may be repurchased from time to time as conditions warrant. Corporate Information State Bancorp's primary subsidiary, State Bank of Long Island, is the largest independent commercial bank headquartered in Nassau County Nassau County is the name of two counties in the United States of America:
Nassau (nä`sou), former duchy, W central Germany, situated N and E of the Main and Rhine rivers. It is now mostly included in the state of Hesse, and partly in the state of Rhineland-Palatinate. , Suffolk Suffolk, county (1991 pop. 629,900), 1,466 sq mi (3,798 sq km), E England. The county seat is Ipswich. Suffolk is bordered on the N by the Ouse and Waveney rivers and on the S by the Stour River. and Queens Counties Queens County or Queen's County is the name of:
State Bancorp, Inc. has a consistent track record of measured, orderly orderly /or·der·ly/ (or´der-le) an attendant in a hospital who works under the direction of a nurse. or·der·ly n. An attendant in a hospital. growth, and has built a reputation for providing high-quality personal service to meet the needs of commercial, small business, municipal and consumer markets throughout the tri-county area. The Company maintains a World Wide Web site at www.statebankofli.com with corporate, investor and branch banking information. State Bancorp, Inc.'s common stock trades under the symbol STB on the American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. . The Company is included in the Russell 2000 index Russell 2000 Index An index measuring the performance of the 2,000 smallest companies in the Russell 3000 Index, which is made up of 3,000 of the biggest U.S. stocks. The Russell 2000 serves as a benchmark for small-cap stocks in the United States. , a leading benchmark A performance test of hardware and/or software. There are various programs that very accurately test the raw power of a single machine, the interaction in a single client/server system (one server/multiple clients) and the transactions per second in a transaction processing system. of small-cap Small-cap A stock with a small capitalization, meaning a total equity value of less than $500 million. small-cap 1. Of or relating to the common stock of a relatively small firm having little equity and few shares of common stock stocks compiled by the Frank Russell Frank Russell may refer to the following people:
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. and Risk Factors This news release contains forward-looking statements, including statements about the financial condition, results of operations and earnings outlook for State Bancorp, Inc. The words "expects," "believes," "anticipates" and other similar expressions are intended to identify forward-looking statements. The forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results or earnings to differ materially from such forward-looking statements include, but are not limited to, the following: (1) general economic conditions, (2) competitive pressure among financial services companies, (3) changes in interest rates, (4) deposit flows, (5) loan demand, (6) changes in legislation or regulation, (7) changes in accounting principles, policies and guidelines, (8) litigation liabilities, including costs, expenses, settlements and judgments and (9) other economic, competitive, governmental, regulatory and technological factors affecting State Bancorp, Inc.'s operations, pricing, products and services. Investors are encouraged to access the Company's periodic reports filed with the Securities and Exchange Commission for financial and business information regarding the Company at www.statebankofli.com/corporate. The Company undertakes no obligation to publish revised events or circumstances after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . (1) All per share amounts have been restated to reflect a 5% stock dividend paid on July July: see month. 9, 2004.
STATE BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, 2005 and 2004 (unaudited)
----------------------------------------------------------------------
2005 2004
--------------- ---------------
Assets:
--------
Cash and due from banks $44,277,997 $44,821,893
Federal funds sold - 3,000,000
Securities purchased under agreements
to resell 20,000,000 5,000,000
--------------- ---------------
Total cash and cash equivalents 64,277,997 52,821,893
Securities held to maturity (estimated
fair value - $19,940,000 in 2005 and
$40,099,440 in 2004) 19,992,979 40,014,000
Securities available for sale - at
estimated fair value 552,368,199 587,270,347
--------------- ---------------
Total securities 572,361,178 627,284,347
Loans (net of allowance for probable
loan losses of $12,904,577 in 2005
and $11,233,286 in 2004) 782,454,712 699,479,126
Bank premises and equipment - net 6,290,183 6,852,717
Bank owned life insurance 26,135,495 25,133,019
Receivable - securities sales 4,063,034 -
Other assets 22,841,073 19,721,134
--------------- ---------------
Total Assets $1,478,423,672 $1,431,292,236
=============== ===============
Liabilities:
--------------
Deposits:
Demand $308,169,360 $282,457,901
Savings 659,937,822 594,525,481
Time 210,556,859 270,508,715
--------------- ---------------
Total deposits 1,178,664,041 1,147,492,097
Federal funds purchased 6,500,000 -
Securities sold under agreements to
repurchase 43,307,000 100,505,000
Other borrowings 87,220,230 37,460,713
Junior subordinated debentures 20,620,000 20,000,000
Payable - securities purchases 31,648,119 18,317,888
Accrued expenses, taxes and other
liabilities 10,870,369 9,489,044
--------------- ---------------
Total Liabilities 1,378,829,759 1,333,264,742
--------------- ---------------
Commitments and contingent
liabilities
Stockholders' Equity:
----------------------
Preferred stock, $.01 par value,
authorized 250,000 shares; 0 shares issued - -
Common stock, $5.00 par value,
authorized 20,000,000 shares; issued
10,054,259 shares in 2005 and 9,911,635
shares in 2004; outstanding 9,128,264
shares in 2005 and 9,005,139 shares
in 2004 50,271,295 47,198,260
Surplus 63,797,731 54,122,582
Retained earnings 5,289,584 7,881,278
Treasury stock (925,995 shares in
2005 and 863,329 shares in 2004) (15,468,528) (14,111,369)
Accumulated other comprehensive (loss)
income (net of taxes of ($2,452,434)
in 2005 and $1,674,624 in 2004) (4,296,169) 2,936,743
--------------- ---------------
Total Stockholders' Equity 99,593,913 98,027,494
--------------- ---------------
Total Liabilities and Stockholders'
Equity $1,478,423,672 $1,431,292,236
=============== ===============
STATE BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the Three Months Ended March 31, 2005 and 2004 (unaudited)
----------------------------------------------------------------------
Three Months
-------------------------
2005 2004
------------ ------------
Interest Income:
-----------------
Interest and fees on loans $13,654,253 $11,630,095
Federal funds sold and securities
purchased under agreements to resell 466,667 179,926
Securities held to maturity:
Taxable 167,639 417,419
Tax-exempt - 832
Securities available for sale:
Taxable 4,562,474 3,188,665
Tax-exempt 555,260 576,958
Dividends 50,238 107,260
------------ ------------
Total interest income 19,456,531 16,101,155
------------ ------------
Interest Expense:
-------------------
Time certificates of deposit of $100,000
or more 1,131,807 528,151
Other deposits and temporary borrowings 3,264,670 2,096,038
Junior subordinated debentures 316,034 247,031
------------ ------------
Total interest expense 4,712,511 2,871,220
------------ ------------
Net interest income 14,744,020 13,229,935
Provision for probable loan losses 1,227,000 1,077,000
------------ ------------
Net interest income after provision
for probable loan losses 13,517,020 12,152,935
------------ ------------
Noninterest Income:
---------------------
Service charges on deposit accounts 496,934 559,100
Net security gains 102,554 2,621,571
Income from bank owned life insurance 256,315 133,019
Other operating income 359,193 389,556
------------ ------------
Total noninterest income 1,214,996 3,703,246
------------ ------------
Income before operating expenses 14,732,016 15,856,181
------------ ------------
Operating Expenses:
--------------------
Salaries and other employee benefits 6,496,085 5,980,866
Occupancy 1,262,572 985,762
Equipment 327,535 368,954
Legal 924,572 845,852
Marketing and advertising 273,572 218,085
Credit and collection 164,760 275,048
Audit and assessment 387,784 194,125
Other operating expenses 1,371,804 1,417,245
------------ ------------
Total operating expenses 11,208,684 10,285,937
------------ ------------
Income before income taxes 3,523,332 5,570,244
Provision for income taxes 874,168 1,675,218
------------ ------------
Net Income $2,649,164 $3,895,026
----------- ============ ============
STATE BANCORP, INC. AND SUBSIDIARIES
SELECTED FINANCIAL DATA
For the Three Months Ended March 31, 2005 and 2004 (unaudited)
(dollars in thousands, except share and per share data)
----------------------------------------------------------------------
Three Months
-----------------------
2005 2004
----------- -----------
Selected Average Balances:
----------------------------
Total assets $1,509,389 $1,439,246
Loans - net of unearned income 785,874 710,078
Investment securities 546,363 561,281
Deposits 1,293,760 1,219,578
Stockholders' equity 102,362 97,180
Financial Performance Ratios:
-------------------------------
Return on average assets 0.71 % 1.09 %
Return on average stockholders' equity 10.50 16.12
Net interest margin (FTE) 4.29 4.02
Operating efficiency ratio 68.87 70.27
Tier I leverage ratio 8.04 7.85
Asset Quality Summary:
------------------------
Nonaccrual loans $4,921 $7,064
Other real estate owned 2,650 2,650
----------- -----------
Total nonperforming assets $7,571 $9,714
=========== ===========
Nonaccrual loans/total loans 0.62 % 0.99 %
Allowance for probable loan losses/nonaccrual
loans 262.23 % 159.02 %
Allowance for probable loan losses/total loans 1.62 % 1.58 %
Net charge-offs $133 $576
Net charge-offs (annualized)/average loans 0.07 % 0.33 %
Common Share Data:
-------------------
Average common shares outstanding (a) 9,114,447 9,011,859
Period-end common shares outstanding (a) 9,128,264 9,005,139
Basic earnings per common share (a) $0.29 $0.43
Diluted earnings per common share (a) $0.28 $0.42
Book value per share (a) $10.91 $10.89
Cash dividends per share (a) $0.15 $0.13
Dividend payout ratio 51.7 % 30.9 %
(a) Prior period data has been restated to give retroactive effect to
a 5% stock dividend paid on July 9, 2004.
----------------------------------------------------------------------
STATE BANCORP, INC. AND SUBSIDIARIES
NET INTEREST INCOME ANALYSIS
For the Three Months Ended March 31, 2005 and 2004 (unaudited)
(dollars in thousands)
----------------------------------------------------------------------
2005
-------------------------------
Average Average
Balance Interest Yield/Cost
-------------------------------
Assets:
--------
Interest-earning assets:
Securities (1) $546,363 $5,555 4.12 %
Federal funds sold - - -
Securities purchased under agreements
to
resell 83,278 467 2.27
Interest-bearing deposits 4,791 25 2.12
Loans (2) 785,874 13,697 7.07
------------------------------
Total interest-earning assets 1,420,306 19,744 5.64
------------------------------
Non-interest-earning assets 89,083
-----------
Total Assets $1,509,389
===========
Liabilities and Stockholders' Equity:
--------------------------------------
Interest-bearing liabilities:
Savings deposits $706,335 2,413 1.39
Time deposits 281,898 1,470 2.11
------------------------------
Total savings and time deposits 988,233 3,883 1.59
------------------------------
Federal funds purchased 7,288 47 2.62
Securities sold under agreements to
repurchase 6,797 48 2.86
Other borrowed funds 61,524 419 2.76
Junior subordinated debentures 20,620 316 6.22
------------------------------
Total interest-bearing liabilities 1,084,462 4,713 1.76
------------------------------
Demand deposits 305,528
Other liabilities 17,037
-----------
Total Liabilities 1,407,027
Stockholders' Equity 102,362
-----------
Total Liabilities and Stockholders'
Equity $1,509,389
===========
Net interest income/rate - tax-
equivalent basis 15,031 4.29 %
==========
Less tax-equivalent basis adjustment (287)
---------
Net interest income $14,744
=========
(1) Interest on securities includes the effects of tax-equivalent
basis adjustments, using a 34% tax rate. Tax-equivalent basis
adjustments were $244 and $279 in 2005 and 2004, respectively.
(2) Interest on loans includes the effects of tax-equivalent basis
adjustments, using a 34% tax rate. Tax-equivalent basis adjustments
were $43 and $47 in 2005 and 2004, respectively.
2004
------------------------------
Average Average
Balance Interest Yield/Cost
------------------------------
Assets:
--------
Interest-earning assets:
Securities (1) $561,281 $4,564 3.27 %
Federal funds sold 1,000 2 0.80
Securities purchased under agreements
to
resell 75,935 178 0.94
Interest-bearing deposits 6,415 6 0.38
Loans (2) 710,078 11,677 6.61
------------------------------
Total interest-earning assets 1,354,709 16,427 4.88
------------------------------
Non-interest-earning assets 84,537
-----------
Total Assets $1,439,246
===========
Liabilities and Stockholders' Equity:
---------------------------------------
Interest-bearing liabilities:
Savings deposits $672,240 1,160 0.69
Time deposits 279,285 1,202 1.73
------------------------------
Total savings and time deposits 951,525 2,362 1.00
------------------------------
Federal funds purchased 8,902 25 1.13
Securities sold under agreements to
repurchase 15,717 44 1.13
Other borrowed funds 61,151 193 1.27
Junior subordinated debentures 20,000 247 4.97
------------------------------
Total interest-bearing liabilities 1,057,295 2,871 1.09
------------------------------
Demand deposits 268,053
Other liabilities 16,718
-----------
Total Liabilities 1,342,066
Stockholders' Equity 97,180
-----------
Total Liabilities and Stockholders'
Equity $1,439,246
===========
Net interest income/rate - tax-
equivalent basis 13,556 4.02 %
==========
Less tax-equivalent basis adjustment (326)
---------
Net interest income $13,230
=========
(1) Interest on securities includes the effects of tax- equivalent
basis adjustments, using a 34% tax rate. Tax- equivalent basis
adjustments were $244 and $279 in 2005 and 2004, respectively.
(2) Interest on loans includes the effects of tax- equivalent basis
adjustments, using a 34% tax rate. Tax-equivalent basis adjustments
were $43 and $47 in 2005 and 2004, respectively.
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