STATE COLLEGE, Pa., Jan. 25 /PRNewswire-FirstCall/ -- Net income for
Omega Financial Corporation (Nasdaq: OMEF) rose by 7.3% to $4.705 million,
or $.37 per diluted share, in the fourth quarter of 2007 compared to $4.386
million, or $.35 per diluted share, during the same period in 2006. Net
income for calendar year 2007, was $21.097 million, representing a 3.3%
increase over 2006 earnings of $20.431 million.
Donita R. Koval, Omega's president and chief executive officer, noted
that both the fourth quarter and calendar year 2007 results reflected the
Corporations ongoing efforts in managing the net interest margin, growing
service revenues and wealth management income and controlling non-interest
expenses.
Koval stated the company's net interest margin for the fourth quarter
of 2007 increased 7 basis points to 4.21% from the fourth quarter of 2006
of 4.14% on a fully tax-equivalent basis. The company's Return on Average
Assets increased 11.2%, to 1.06%, and Return on Average Equity increased
4.6% to 5.61%, when compared to the same period in 2006.
For the year, Omega's net interest margin rose 12 basis points to 4.19%
from 4.07% in 2006. The company's Return on Average Assets was 1.17% and
Return on Average Equity 6.36%, representing an increase of 8.8% and .7%,
respectively.
The net interest margin grew despite decreases in net interest income
of $.2 million for the quarter and $1.2 million for the year. Koval noted
that 2006 net interest income included $1.0 million attributable to three
branches sold in the final quarter of 2006.
In the fourth quarter of 2007, Omega reported a provision for loan
losses of $.6 million compared to $2.8 million during the same period in
2006. The year to date provision for loan loss in 2007 totals $2.2 million
compared to $3.9 million in 2006. The higher level of loan loss provision
in 2006 related primarily to specific provisions recorded for two large
commercial borrowers. In the fourth quarter of 2006, one of the borrower's
loans was sold, while in May 2007, the other borrower emerged from
bankruptcy reorganization and as a result $4.4 million of this borrowers
loans were charged off in the second quarter of 2007. As of December 31,
2007, total loans outstanding to this borrower totaled $14.9 million, with
a specific allocation of the loan loss allowance totaling $1.8 million,
which management deems to be adequate. This compares to total loans
outstanding to this borrower of $16.8 million with a specific allocation of
loan loss allowance of $5.3 million as of December 31, 2006. Although the
borrower is current with all payments, these loans remain on non-accrual
status until the new entity demonstrates consistent positive operating cash
flow.
Other income for the fourth quarter of 2007, excluding gains on the
sale of investment securities and other assets, increased $.2 million or
2.53% as compared to the same period last year. Year to date non-interest
income, excluding gains on the sale of investments and other assets,
increased $1.3 million or 4.95% to $27.411 million due primarily to
increases in deposit and loan fees as well as growth in wealth management
fees. The three branch locations sold in 2006 contributed $.2 million of
non-interest income in 2006.
Other expense increased in the fourth quarter of 2007 by $.1 million or
.81%, and decreased $1.5 million or 2.54% for the year of 2007. Included in
other expense for both the fourth quarter and year of 2007 is $.8 million
in expenses related to the announced merger with F.N.B. Corporation. These
expenses were offset by decreases in other areas such as renegotiations on
key operating contracts and restructuring of certain business lines,
including the formation of a mortgage joint venture. The three branch
locations sold in the fourth quarter of 2006 contributed $.7 million of
non-interest expense in 2006.
In the fourth quarter of 2007, the Company signed a definitive merger
agreement with F.N.B. Corporation (NYSE: FNB) pursuant to which F.N.B.
Corporation will acquire Omega. The combination of the two organizations
will create the fifth largest bank holding company based in Pennsylvania
with approximately $8 billion in total assets and over 210 full service
branches serving commercial and consumer customers in 35 counties in
Pennsylvania and Northeast Ohio.
Quarterly and annual reports, a corporate profile, stock quotes and
other financial data can be accessed through the Omega web site at
http://www.omegafinancial.com. Financial statements and selected financial
highlights are summarized on the following pages.
CONTACT: Teresa Ciambotti, SVP, Director of Investor Relations
(814) 231-6401
OMEGA FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except as indicated *)
Three Months Ended December 31,
2007 2006 % Change
Earnings:
Net income $4,705 $4,386 7.3%
Per share statistics: *
Diluted earnings $.37 $.35 5.7%
Dividends declared - common .31 .31 -
Book value - common 26.43 25.76 2.6
Book value - tangible 13.37 12.61 6.0
Market value - High 32.40 33.50 (3.3)
Low 24.45 29.48 (17.1)
Financial position at period end:
Assets $1,789,100 $1,815,818 (1.5)%
Net loans 1,090,284 1,135,048 (3.9)
Deposits 1,280,869 1,325,763 (3.4)
Shareholders' equity 334,749 325,211 2.9
Average Balances:
Assets $1,781,140 $1,846,561 (3.5)%
Net loans 1,095,940 1,147,555 (4.5)
Deposits 1,283,349 1,359,209 (5.6)
Shareholders' equity 335,680 327,203 2.6
Non-Performing Loans at period end:
Non-accrual loans $21,510 $21,001 2.4%
Accruing loans past due 90 days or
more 6,891 2,327 196.1
Profitability ratios - annualized: *
Return on average assets 1.06% 0.95% 11.2%
Return on tangible assets 1.17 1.04 12.5
Return on average stated equity (1) 5.61 5.36 4.6
Return on average tangible equity (2) 11.07 10.91 1.5
Net interest margin - fully tax
equivalent 4.21 4.14 1.7
Shares outstanding at period end: *
Common 12,665,613 12,622,802 0.3%
Twelve Months Ended December 31,
2007 2006 % Change
Earnings:
Net income $21,097 $20,431 3.3%
Per share statistics: *
Diluted earnings $1.67 $1.62 3.1%
Dividends declared - common 1.24 1.24 -
Book value - common 26.43 25.76 2.6
Book value - tangible 13.37 12.61 6.0
Market value - High 34.49 34.21 0.8
Low 20.97 27.88 (24.8)
Financial position at period end:
Assets $1,789,100 $1,815,818 (1.5)%
Net loans 1,090,284 1,135,048 (3.9)
Deposits 1,280,869 1,325,763 (3.4)
Shareholders' equity 334,749 325,211 2.9
Average Balances:
Assets $1,796,135 $1,893,973 (5.2)%
Net loans 1,120,728 1,172,033 (4.4)
Deposits 1,299,668 1,397,648 (7.0)
Shareholders' equity 331,636 323,370 2.6
Non-Performing Loans at period end:
Non-accrual loans $21,510 $21,001 2.4%
Accruing loans past due 90 days or
more 6,891 2,327 196.1
Profitability ratios - annualized: *
Return on average assets 1.17% 1.08% 8.8%
Return on tangible assets 1.29 1.18 9.3
Return on average stated equity (1) 6.36 6.32 0.7
Return on average tangible equity (2) 12.72 13.22 (3.8)
Net interest margin - fully tax
equivalent 4.19 4.07 2.9
Shares outstanding at period end: *
Common 12,665,613 12,622,802 0.3%
(1) Average stated equity is equal to average shareholders' equity.
(2) Average tangible equity represents average shareholders' equity less
average intangibles and goodwill.
OMEGA FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(unaudited)
December 31, December 31,
2007 2006
Assets
Cash and due from banks 58,946 56,225
Interest bearing deposits with other
banks 11,473 12,073
Federal funds sold 41,750 -
Trading securities 61 48
Investment securities available for sale 276,525 291,807
Other investments 12,116 12,087
Investment in unconsolidated subsidiary 1,625 1,625
Loans held for sale 414 531
Total portfolio loans 1,102,756 1,151,861
Less: Allowance for loan losses (12,886) (17,344)
Net portfolio loans 1,089,870 1,134,517
Premises and equipment, net 29,107 30,861
Other real estate owned 1,424 512
Bank-owned life insurance 75,783 76,341
Investment in limited partnerships 5,000 5,763
Core deposit intangibles 4,905 5,641
Other intangibles 975 1,085
Goodwill 159,567 159,387
Other assets 19,559 27,315
TOTAL ASSETS $1,789,100 $1,815,818
Liabilities and Shareholders' Equity
Deposits:
Non-interest bearing $235,948 $232,335
Interest bearing 1,044,921 1,093,428
Total deposits 1,280,869 1,325,763
Short-term borrowings 78,449 65,712
ESOP debt - 1,481
Junior subordinated debentures 55,695 56,193
Long-term debt 26,434 27,877
Other interest bearing liabilities 843 858
Other liabilities 12,061 12,723
TOTAL LIABILITIES 1,454,351 1,490,607
Shareholders' Equity
Preferred stock, par value $5.00 per share:
Authorized - 5,000,000 shares, none issued
Common stock, par value $5.00 per share:
Authorized - 25,000,000 shares;
Issued -
12,900,229 shares at December 31, 2007
12,823,471 shares at December 31, 2006 64,517 64,133
Outstanding -
12,665,613 shares at December 31, 2007
12,622,802 shares at December 31, 2006
Capital surplus 104,750 103,149
Retained earnings 170,167 164,653
Accumulated other comprehensive income 2,453 313
Unearned compensation related to ESOP debt - (859)
Cost of common stock in treasury:
234,616 shares at December 31, 2007;
200,669 shares at December 31, 2006 (7,138) (6,178)
TOTAL SHAREHOLDERS' EQUITY 334,749 325,211
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $1,789,100 $1,815,818
OMEGA FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share data)
(Unaudited)
Three Twelve
Months Ended Months Ended
December 31, December 31,
2007 2006 2007 2006
Interest Income:
Interest and fees on loans $19,314 $20,273 $78,914 $81,103
Interest and dividends on
investment securities 3,426 3,294 13,686 12,518
Other interest income 606 308 1,378 1,166
TOTAL INTEREST INCOME 23,346 23,875 93,978 94,787
Interest Expense:
Interest on deposits 6,612 6,838 26,593 25,966
Interest on short-term borrowings 517 589 2,536 2,731
Interest on long-term debt and
other interest bearing
liabilities 1,261 1,253 5,024 5,024
TOTAL INTEREST EXPENSE 8,390 8,680 34,153 33,721
NET INTEREST INCOME 14,956 15,195 59,825 61,066
Provision for loan losses 595 2,776 2,155 3,896
INCOME FROM CREDIT ACTIVITIES 14,361 12,419 57,670 57,170
Other Income:
Service fees on deposit accounts 2,719 2,584 10,410 10,130
Service fees on loans 392 365 1,499 1,635
Earnings on bank-owned life
insurance 627 634 2,556 2,413
Trust fees 1,055 999 4,312 4,063
Investment and insurance product
sales 629 732 2,868 2,942
Gain on sale of loans and other
assets 34 2,147 39 2,380
Net gains (losses) on the sale of
investment securities 141 (426) 632 389
Other 1,388 1,328 5,766 4,934
TOTAL OTHER INCOME 6,985 8,363 28,082 28,886
Other Expense:
Salaries and employee benefits 7,335 7,209 28,667 29,398
Net occupancy expense 1,120 1,111 4,266 4,318
Equipment expense 1,069 1,189 4,554 4,571
Data processing service 573 641 2,389 2,642
Pennsylvania shares tax 776 727 3,009 2,765
Amortization of intangible assets 211 218 845 882
Merger Expense 765 - 765 -
Other 3,418 4,050 13,600 15,033
TOTAL OTHER EXPENSE 15,267 15,145 58,095 59,609
Income before income taxes and
discontinued operations 6,079 5,637 27,657 26,447
Income tax expense 1,374 1,030 6,560 5,702
Income from continuing operations 4,705 4,607 21,097 20,745
Discontinued operations:
Income from discontinued
operations, net of tax - 446 - 446
Loss on disposal of discontinued
operations, net of tax - (667) - (760)
Income (Loss) from discontinued
operations - (221) - (314)
NET INCOME $4,705 $4,386 $21,097 $20,431
Net income per common share
Basic $0.37 $0.35 $1.67 $1.62
Diluted $0.37 $0.35 $1.67 $1.62
Net income per common share from
continuing operations
Basic $0.37 $0.37 $1.67 $1.65
Diluted $0.37 $0.36 $1.67 $1.65
Net income per common share from
discontinued operations
Basic $- $(0.02) $- $(0.02)
Diluted $- $(0.02) $- $(0.02)
Weighted average shares and
equivalents
Basic 12,640 12,591 12,631 12,577
Diluted 12,653 12,627 12,643 12,610
Dividends declared per share
Common $0.31 $0.31 $1.24 $1.24
Omega Financial Corporation
Consolidated Net Interest Income Analysis
Fourth Quarter 2007 vs. Fourth Quarter 2006
(In thousands)
Fourth Quarter 2007
Average Income/
Balance Rate Expense
INTEREST EARNING ASSETS
Money Market Investments
Interest Bearing Deposits 22,293 3.95% 222
Federal Funds Sold 33,876 4.50% 384
Total Money Market Investments 56,169 4.28% 606
Investment Securities
U.S. Treasuries and Agencies 258,748 4.66% 3,037
State and Municipals-Tax Free 695 3.45% 6
Corporate Securities & Stock 25,199 6.08% 383
Total Investment Securities 284,642 4.78% 3,426
Loans
Commercial Loans 216,325 7.31% 3,988
Tax Free Commercial Loans 16,267 4.90% 201
Real Estate Loans 630,459 6.81% 10,731
Tax Free Real Estate Loans 37,949 4.37% 415
Personal Loans and Leases 207,554 7.61% 3,979
Total Loans 1,108,554 6.95% 19,314
Total Earning Assets 1,449,365 6.42% 23,346
FUNDING SOURCES
Interest Bearing Liabilities
Checking with Interest 292,163 0.65% 476
Money Market Deposits 65,928 1.47% 245
Savings Deposits 168,921 0.55% 234
CD'S, $100,000 and Over 90,324 4.41% 1,005
Other Time Deposits 433,672 4.26% 4,652
Total Interest Bearing Deposits 1,051,008 2.50% 6,612
Short-Term Borrowings 68,152 3.01% 517
Long-Term Debt 82,372 6.08% 1,253
Other Interest Bearing Liabilities 799 4.01% 8
Demand Deposits 232,341
Cash (45,648)
Other 60,341
Total Funding Sources 1,449,365 2.30% 8,390
Net Int Spread - Net Int Income 4.12% 14,956
Net Int Spread - Tax Equivalent 4.21%
Net Int Income - Tax Equivalent 15,291
Tax Rate 35%
Fourth Quarter 2006
Average Income/
Balance Rate Expense
INTEREST EARNING ASSETS
Money Market Investments
Interest Bearing Deposits 11,738 4.36% 129
Federal Funds Sold 13,489 5.26% 179
Total Money Market Investments 25,227 4.84% 308
Investment Securities
U.S. Treasuries and Agencies 276,502 4.07% 2,835
State and Municipals-Tax Free 16,265 2.31% 94
Corporate Securities & Stock 24,331 6.00% 365
Total Investment Securities 317,098 4.13% 3,294
Loans
Commercial Loans 247,984 7.52% 4,699
Tax Free Commercial Loans 17,839 4.80% 216
Real Estate Loans 665,012 6.90% 11,477
Tax Free Real Estate Loans 40,463 4.34% 439
Personal Loans and Leases 191,730 7.12% 3,442
Total Loans 1,163,028 6.95% 20,273
Total Earning Assets 1,505,353 6.32% 23,875
FUNDING SOURCES
Interest Bearing Liabilities
Checking with Interest 298,946 0.78% 586
Money Market Deposits 78,236 1.51% 297
Savings Deposits 181,884 0.55% 252
CD'S, $100,000 and Over 97,569 4.28% 1,052
Other Time Deposits 470,560 3.92% 4,651
Total Interest Bearing Deposits 1,127,195 2.41% 6,838
Short-Term Borrowings 61,838 3.78% 589
Long-Term Debt 84,303 5.90% 1,244
Other Interest Bearing Liabilities 814 4.42% 9
Demand Deposits 232,014
Cash (49,442)
Other 48,631
Total Funding Sources 1,505,353 2.29% 8,680
Net Int Spread - Net Int Income 4.03% 15,195
Net Int Spread - Tax Equivalent 4.14%
Net Int Income - Tax Equivalent 15,598
Tax Rate 35%
Increase/(Decrease)
Due To Due To Net
Volume Rate Change
INTEREST EARNING ASSETS
Money Market Investments
Interest Bearing Deposits 106 (13) 93
Federal Funds Sold 234 (29) 205
Total Money Market Investments 340 (42) 298
Investment Securities
U.S. Treasuries and Agencies (190) 392 202
State and Municipals-Tax Free (119) 31 (88)
Corporate Securities & Stock 13 5 18
Total Investment Securities (297) 429 132
Loans
Commercial Loans (583) (128) (711)
Tax Free Commercial Loans (19) 4 (15)
Real Estate Loans (596) (150) (746)
Tax Free Real Estate Loans (27) 3 (24)
Personal Loans and Leases 293 244 537
Total Loans (933) (26) (959)
Total Earning Assets (889) 360 (529)
FUNDING SOURCES
Interest Bearing Liabilities
Checking with Interest (13) (97) (110)
Money Market Deposits (45) (8) (52)
Savings Deposits (18) - (18)
CD'S, $100,000 and Over (79) 32 (47)
Other Time Deposits (382) 383 1
Total Interest Bearing Deposits (537) 311 (226)
Short-Term Borrowings 56 (128) (72)
Long-Term Debt (29) 38 9
Other Interest Bearing Liabilities (0) (1) (1)
Demand Deposits
Cash
Other
Total Funding Sources (510) 220 (290)
Net Int Spread - Net Int Income (380) 141 (239)
Net Int Spread - Tax Equivalent
Net Int Income - Tax Equivalent
Tax Rate
SOURCE Omega Financial Corporation
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Related links:
http://www.omegafinancial.com
CONTACT:
Teresa Ciambotti, SVP, Director of Investor
Relations of Omega Financial Corporation, +1-814-231-6401
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