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METROPOLITAN BANCORP REPORTS 47 PERCENT EARNINGS INCREASE AS IT PREPARES TO LAUNCH FOUR NEW OFFICES

 SEATTLE, Oct. 19 /PRNewswire/ -- Metropolitan Bancorp (NASDAQ: MSEA) announced today it has just completed its thirteenth consecutive quarter of improved earnings. Net income for the second fiscal quarter ended Sept. 30, 1993 increased 47 percent to a new record of $1.6 million or 50 cents per share, compared to net income before extraordinary item of $1.1 million or 34 cents per share for the quarter ended Sept. 30, 1992. Net income after an extraordinary item representing utilization of net operating loss carryforwards totalled $1.4 million for the quarter ended Sept. 30, 1992.
 Earnings before extraordinary item and cumulative effect of change in accounting principle for the six months ending Sept. 30, 1993 totalled $3.2 million or 98 cents per share, compared to $2.2 million or 67 cents per share for the six months ended Sept. 30, 1992.
 In addition, the company reported a $408,000 nonrecurring adjustment for the cumulative effect of a change in accounting principle for total reported earnings for the six month period of $3.6 million or $1.11 per share. This compares to a net income of $2.7 million or 84 cents per share for the year earlier after an extraordinary item totalling $545,000 and representing utilization of net operating loss carryforwards.
 Metropolitan's annualized return on average equity before extraordinary or nonrecurring items was 15.4 percent for the quarter ended Sept. 30, 1993, compared to 12.4 percent for the quarter ended Sept. 30, 1992. Return on average assets before extraordinary or nonrecurring items was 1.16 percent for the quarter ended Sept. 30, 1993, compared to 1.00 percent for the same period a year ago. Net interest margin was 2.70 percent for the second quarter of fiscal 1994, compared to 3.12 percent for second quarter of fiscal 1993.
 Patrick F. Patrick, president and chief executive officer, said today, "With record earnings, the company is well-positioned to expand its subsidiary, Metropolitan Savings, with two new branches. These branches will be opening Oct. 25, and will be located in Lakewood, a suburb of Tacoma, and in Auburn, Wash."
 Patrick continued, "The approximate $30 million in deposits brought in by the Lakewood facility will assist the company in maintaining its recent growth in customer accounts. We have long desired to expand the company's presence in the markets of south King and Pierce counties. These areas are among the fastest growing in the Puget Sound region and represent exceptional growth opportunities for our association," he said.
 "Becoming active participants in these two areas will be one of our first priorities, especially seeing to it that funds are available to meet the needs of these entire communities," Patrick added.
 Metropolitan Savings increased its deposit base to $343 million at Sept. 30, 1993, from $327 million at June 30, 1993, an annualized growth rate of 20 percent.
 "We are exceptionally pleased to achieve this growth in what has been described as difficult times," Patrick said. "Most of the gains have come from customers moving their accounts from institutions which have been involved in mergers or acquisitions," he added.
 General and administrative expenses as a percentage of average assets improved to 1.44 percent on an annualized basis for the quarter ended Sept. 30, 1993, as compared to 1.61 percent for the same quarter one year ago.
 Patrick said, "Our G&A to assets ratio is in the high-achieving range of savings associations across the country. Although we are pleased with the progress to date, we are expecting further improvements in the coming periods."
 "We believe that the company's posture of maintaining a conservative balance sheet has served the shareholders well while providing safety for the customers of our various savings plans," Patrick added.
 Metropolitan's assets totalled $581 million at Sept. 30, 1993, compared to $508 million at March 31, 1993, and $482 million at Sept. 30, 1992. Capital totalled $43.6 million or 7.50 percent of assets at the end of Sept. 30, 1993, compared to $39.8 million or 7.84 percent of assets at March 31, 1993, and $36.6 million or 7.60 percent of assets at Sept. 30, 1992. Metropolitan's book value per share was $13.29 at Sept. 30, 1993.
 With the Oct. 25 addition of two offices, Metropolitan Savings will have nine branches in the Puget Sound region. The association will be expanding to 11 full-service offices soon with openings planned for December 1993 and January 1994. The association also operates loan offices in Mount Vernon and Oak Harbor, under the name of Jacobsen Mortgage Services.
 Metropolitan Bancorp is a savings and loan holding company formed in July 1993. Its principal subsidiary, Metropolitan Savings, is an FDIC-insured, federally chartered savings and loan association organized in 1935 with offices serving the greater Puget Sound area.
 METROPOLITAN BANCORP AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
 (In thousands except per share data)
 1993 Sept. 30 March 31
 (Unaudited)
 Assets
 Cash and due from banks
 (including interest-bearing
 deposits of $2,042 and $844) $ 2,757 $ 1,358
 Securities held for sale (fair
 value of $20,875 and $20,705) 20,600 20,589
 Mortgage-backed securities held for
 sale (fair value of $19,934
 and $27,282) 19,678 27,138
 Mortgage-backed securities held
 for investment (fair value of
 $230,652 and $139,190) 228,076 137,694
 Loans (net of reserve for losses
 of $5,884 and $5,632) 272,928 285,126
 Loans held for sale 3,260 3,847
 Accrued interest receivable 3,368 3,000
 Real estate held for sale 6,992 8,728
 Real estate held for investment 6,986 6,928
 Federal Home Loan Bank stock,
 at cost 9,092 8,203
 Premises and equipment, net 5,104 4,258
 Prepaid expenses and other assets 1,939 1,121
 Total assets $580,780 $507,990
 Liabilities and stockholders' equity
 Deposits $343,179 $307,323
 Advances from FHLB 167,350 150,520
 Subordinated debt 21,934 --
 Other borrowings -- 4,685
 Federal income taxes
 Current -- 515
 Deferred -- 193
 Other liabilities 4,732 4,920
 Total liabilities 537,195 468,156
 Preferred stock, 10,000,000 shares
 authorized; no shares issued -- --
 Common stock 1 cent par value
 40,000,000 shares authorized;
 3,278,413 and 3,264,080 shares
 issued and outstanding 33 33
 Additional paid-in capital 26,148 26,026
 Retained earnings 17,404 13,775
 Total stockholders' equity 43,585 39,834
 Total liabilities and stockholders'
 equity $580,780 $507,990
 METROPOLITAN BANCORP AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited; In thousands except per share data)
 Three months ended Six months ended
 Sept. 30, 1993 1992 1993 1992
 Interest income:
 Loans receivable $ 5,743 $ 6,207 $11,509 $12,895
 Mortgage-backed securities 3,431 1,926 6,411 2,945
 Investment securities 283 347 564 704
 Other 315 186 651 317
 Total 9,772 8,666 19,135 16,861
 Interest expense:
 Deposits 3,538 3,594 6,871 7,150
 Borrowings 2,131 1,584 4,211 2,785
 Subordinated debt 287 -- 287 --
 Total 5,956 5,178 11,369 9,935
 Net interest income 3,816 3,488 7,766 6,926
 Provision for loan losses 100 200 250 361
 Net interest income after
 provision for loan losses 3,716 3,288 7,516 6,565
 Other income:
 Collection of deferred asset 220 -- 220 636
 Gain on sale of loan servicing 223 235 223 235
 Other 166 136 358 260
 Total 609 371 801 1,131
 Other expense:
 Compensation and fringe benefits 912 817 1,845 1,687
 Occupancy 290 263 576 514
 Savings Association Insurance
 Fund premiums 181 151 311 314
 Advertising 122 75 242 160
 Net loss (income) on real
 estate operations (216) 118 (541) 539
 Other 526 496 982 1,092
 Total 1,815 1,920 3,415 4,306
 Income before federal income
 taxes and extraordinary item
 and cumulative effect of change
 in accounting principle 2,510 1,739 4,902 3,390
 Federal income tax expense
 (benefit)
 Current 452 618 1,664 1,205
 Deferred 415 -- 17 --
 Total 867 618 1,681 1,205
 Net income before extraordinary
 item and cumulative effect
 of change in accounting
 principle 1,643 1,121 3,221 2,185
 Extraordinary item -- 287 -- 545
 Net income before cumulative
 effect of change in
 accounting principle 1,643 1,408 3,221 2,730
 Cumulative effect of change in
 accounting principle -- -- 408 --
 Net income $ 1,643 $ 1,408 $ 3,629 $ 2,730
 Net income per share before
 extraordinary item and
 cumulative effect of change
 in accounting principle $ 0.50 $ 0.34 $ 0.98 $ 0.67
 Extraordinary item per share -- 0.09 -- 0.17
 Cumulative effect of change in
 accounting principle per share -- -- 0.13 --
 Net income per share $ 0.50 $ 0.43 $ 1.11 $ 0.84
 Weighted average number of
 shares outstanding 3,273,174 3,259,692 3,268,652 3,257,648
 METROPOLITAN BANCORP AND SUBSIDIARIES
 ADDITIONAL INFORMATION
 (Unaudited; In thousands except per share data)
 9/30/93 6/30/93 3/31/93 12/31/92 9/30/92
 Stockholders' equity
 per share $13.29 $12.81 $12.20 $11.70 $11.22
 Stockholders' equity
 to total assets
 (percents) 7.50 7.60 7.84 7.80 7.60
 Regulatory capital
 ratios (percents):
 Tangible 10.10 7.51 7.84 7.79 7.59
 Core 10.10 7.51 7.84 7.79 7.59
 Risk-based 19.16 14.60 14.06 14.37 12.94
 Non-accrual loans $2,632 $2,600 $6,394 $11,884 $8,004
 Loan loss reserves $5,884 $5,783 $5,632 $5,960 $6,029
 Three months ended Six months ended
 Sept. 30, 1993 1992 1993 1992
 Percent Percent
 Yield on interest-earning
 assets 7.24 8.04 7.27 8.26
 Rate on interest-bearing
 liabilities 4.59 5.07 4.52 5.15
 Net interest margin 2.70 3.12 2.83 3.25
 Return on average equity
 before extraordinary or
 non-recurring items 15.41 12.44 15.47 12.36
 Return on average assets
 before extraordinary or
 non-recurring items 1.16 1.00 1.17 1.03
 -0- 10/19/93
 /CONTACT: Suzanne Tessaro of Metropolitan Bancorp, 206-654-7826/
 (MSEA)


CO: Metropolitan Bancorp ST: Washington IN: FIN SU: ERN

JH-AL -- SE014 -- 4232 10/19/93 17:26 EDT
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