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STERLING BANCSHARES CORPORATION REPORTS THIRD QUARTER EARNINGS OF $1.8 MILLION OR $0.61 PER SHARE

 STERLING BANCSHARES CORPORATION REPORTS THIRD QUARTER EARNINGS
 OF $1.8 MILLION OR $0.61 PER SHARE
 WALTHAM, Mass., Oct. 15 /PRNewswire/ -- Sterling Bancshares Corporation (NASDAQ: STLG), the holding company for Sterling Bank, today reported earnings for the third quarter ended Sept. 30,1992, of $1.8 million or $0.61 per share, compared to $961,000 or $0.33 per share for the same period in 1991. For the nine month period ended Sept. 30, 1992, net income was $6.0 million or $2.03 per share, compared to a net loss of $372,000 or $0.13 per share for the same period last year. The results for 1992 were positively impacted by a one-time $1.1 million or $0.37 per share gain realized during the first quarter in connection with early adoption of Statement of Financial Accounting Standards No. 109 (SFAS No. 109) "Accounting for Income Taxes".
 Nonperforming assets declined approximately 35 percent from $8.8 million at June 30, 1992, to $5.8 million at Sept. 30, 1992, and consisted of $3.6 million in nonperforming loans and $2.2 million in other real estate owned, net. This represents a 52 percent decline from $12.1 million in nonperforming assets at Dec. 31, 1991. At Sept. 30, 1992, the loan loss reserve was $4.6 million, which represents approximately 129 percent coverage of nonperforming loans and approximately 80 percent coverage of nonperforming assets.
 Total assets were $936.5 million and were comprised primarily of $587.9 million in investments and $318.4 million in net loans. Total deposits were $667.0 million at Sept. 30, 1992, as compared to $684.8 million at Sept. 30, 1991.
 John C. Warren, president and chief executive officer of Sterling Bancshares Corporation said, "our third quarter performance reflects the successful efforts of the company effectively managing within a difficult economic climate. Especially significant was the further decline in nonperforming assets to $5.8 million (0.62 percent of total assets)".
 On Oct. 14, 1992, the board of directors announced a dividend of $0.15 per share which represents a 25 percent increase from the prior quarter of $0.12 per share. This dividend is payable on Nov. 13, 1992, to shareholders of record on Oct. 26, 1992. At Sept. 30, 1992, the corporation had 2,941,631 shares of common stock outstanding, with a net book value of $19.51 per share.
 Sterling Bank, a wholly owned subsidiary of Sterling Bancshares Corporation, offers a comprehensive line of business and personal banking services from its 13 offices located in nine cities and towns in Middlesex County.
 Sterling Bancshares Corporation
 Consolidated Statements of Operations
 ($ in thousands, except for per share amounts)
 Three Months Ended Nine Months Ended
 Sept. 30, Sept. 30,
 1992 1991 1992 1991
 Unaudited
 INTEREST AND DIVIDEND INCOME:
 Interest and fees
 on mortgage loans $6,722 $6,709 $20,124 $18,114
 Interest and fees
 on other loans 528 569 1,967 1,526
 Interest and dividends
 on investment securities 978 1,332 3,140 3,416
 Interest on short-term
 investments 179 692 485 2,214
 Interest on asset-backed
 securities 9,322 9,421 28,732 20,691
 Total interest and
 dividend income 17,729 18,723 54,448 45,961
 INTEREST EXPENSE:
 Interest on deposits 7,330 10,609 23,427 25,025
 Interest on borrowings 2,701 2,110 8,288 7,672
 Total interest expense 10,031 12,719 31,715 32,697
 Net interest income 7,698 6,004 22,733 13,264
 Provision for loan losses 750 679 2,250 2,997
 Net interest income, after
 provision for loan losses 6,948 5,325 20,483 10,267
 OTHER INCOME:
 Gain on sales of
 securities, net --- 3 275 573
 Service fees 344 258 1,043 594
 Miscellaneous 118 58 264 196
 Total other income 462 319 1,582 1,363
 OPERATING EXPENSES:
 Salaries and employee
 benefits 2,211 1,987 6,458 4,572
 Occupancy and equipment
 expenses 632 787 1,854 1,508
 Other real estate
 owned expenses, net 42 132 614 739
 FDIC deposit insurance
 expense 380 311 1,165 653
 Other general and
 administrative expenses 1,307 1,381 4,260 4,943
 Total operating expenses 4,572 4,598 14,351 12,415
 Income (loss) before income
 taxes and cumulative effect
 of change in accounting
 principle 2,838 1,046 7,714 (785)
 Provision (benefit) for
 income taxes 1,048 85 2,851 (413)
 Income (loss) before
 cumulative effect of change
 in accounting principle 1,790 961 4,863 (372)
 Cumulative effect of change
 in accounting principle --- --- 1,088 ---
 Net income (loss) $1,790 $961 $5,951 ($372)
 Earnings (loss) per share
 before cumulative effect
 of change in accounting
 principle 61 cents 33 cents $1.66 (13 cents)
 Earnings (loss)
 per share 61 cents 33 cents $2.03 (13 cents)
 Weighted average shares
 outstanding 2,939,339 2,924,900 2,934,012 2,924,211
 Consolidated Balance Sheets
 (dollars in thousands, except per share amounts)
 (unaudited)
 Sept. 30, Dec. 31, Sept. 30,
 1992 1991 1991
 Assets:
 Cash and due from
 banks $9,513 $9,386 $11,004
 Short-term investments 21,927 2,860 2,292
 Total cash and cash
 equivalents 31,440 12,246 13,296
 Investment securities 76,624 80,660 72,979
 Asset-backed securities 489,388 487,081 493,078
 Loans, net of unearned
 discount 322,991 298,790 287,144
 Allowance for loan losses (4,588) (3,544) (4,632)
 Loans, net 318,403 295,246 282,512
 Banking premises and
 equipment, net 6,849 6,742 5,901
 Other real estate owned, net 2,218 3,534 4,502
 Accrued interest receivable 6,086 6,930 7,262
 Other assets 5,502 6,218 8,833
 Total assets $936,510 $898,657 $888,363
 LIABILITIES AND STOCKHOLDERS EQUITY
 Deposits $667,040 $676,773 $684,829
 Federal Home Loan Bank
 borrowings 90,000 70,000 60,428
 Securities sold under
 agreements to repurchase
 and other short term
 borrowings 114,280 84,970 78,973
 Liability in connection with
 ESOP 283 425 425
 Other liabilities 7,526 14,380 13,498
 Total liabilities 879,129 846,548 838,153
 STOCKHOLDERS' EQUITY
 Serial preferred stock, $0.10
 par value, 5,000,000 shares
 authorized, none issued --- --- ---
 Common stock, $0.10 par value,
 15,000,000 shares authorized,
 3,686,900 shares issued 369 369 369
 Additional paid-in capital 43,218 43,138 43,138
 Retained earnings 21,048 16,153 14,256
 Total 64,635 59,660 57,763
 Treasury stock at cost-
 745,269 shares at Sept. 30,
 1992, 761,774 shares at
 Dec. 31, 1991 and 762,000
 at Sept. 30, 1991 (6,971) (7,126) (7,128)
 Unearned compensation-ESOP (283) (425) (425)
 Total stockholders' equity 57,381 52,109 50,210
 Total liabilities and
 stockholders' equity $936,510 $898,657 $888,363
 Capital ratio 6.13 pct. 5.80 pct. 5.65 pct.
 Book value per share $19.51 $17.81 $17.17
 Shares outstanding 2,941,631 2,925,126 2,924,900
 -0- 10/15/92
 /CONTACT: Karen Wharton of Sterling Bancshares, 617-894-7790, x215/
 (STLG) CO: Sterling Bancshares Corporation ST: Massachusetts IN: FIN SU: ERN


CH -- NE007 -- 0466 10/15/92 13:23 EDT
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