CLARKSTON, Wash., Jan. 27 /PRNewswire-FirstCall/ -- FirstBank NW Corp.
(Nasdaq: FBNW), the holding company for FirstBank Northwest, today reported
net income of $1,281,000, or $0.52 per diluted share, and total assets of
$684.5 million in its third fiscal quarter ended December 31, 2003.
FirstBank also announced its Board of Directors has declared a regular
quarterly cash dividend of $0.17 per common share. The dividend will be paid
February 19, 2004 to shareholders of record at February 5, 2004. This is the
26th consecutive regular quarterly cash dividend paid.
Clyde E. Conklin, President and Chief Executive Officer of FirstBank
NW Corp., stated that "This is the first earnings release reflecting the
financial results of FirstBank NW Corp. and FirstBank Northwest subsequent to
closing of the acquisition of Oregon Trail Financial Corp. and its
wholly-owned subsidiary, Pioneer Bank, on October 31, 2003. As a result, the
historical perspective in terms of comparable results of one year ago, which
is traditionally provided to frame the context of current data, is not
relevant and is therefore not discussed." Conklin recommended the Form 8-K/A
filed with the Securities and Exchange Commission on January 16, 2004 as an
excellent resource for historical reference, based on the most recent publicly
filed information pertaining to both companies. The Form 8-K/A reflects the
September 30, 2003 quarter end numbers. Additionally, the Form 10-QSB to be
filed with the SEC in mid February 2004 will provide detail for the quarter
ended December 31, 2003 reflecting the acquisition and quarterly financial
performance.
"We are very pleased to report record net income of $1,281,000 for the
first quarter of merged operations," noted Conklin. "The acquisition
essentially doubled the size of FirstBank. The respective staff of both
institutions came together as a team to focus on financial performance,
customer service, and joint operational procedures. Integration of systems,
processes, and technologies will continue and result in improved efficiency,
improved profitability, and a seamless transition to customer service. All of
which improves our shareholder value," added Conklin.
"Net earnings for the quarter of $1,281,000, or $0.52 per diluted share,
were impacted by non-reoccurring items including the interest paid on bridge
loan financing during the closing of the Oregon Trail acquisition of
$63,747, the re-evaluation and subsequent write down of mortgage servicing
rights of $170,500, a one time charge to other compensation expense of
$63,161 for paid time off adjustment because of policy changes related to
integration of leave accrual, and other small expenses incurred during the
quarter," reported Larry K. Moxley, Chief Financial Officer. Non-interest
expense for the quarter was $4,723,000, which reflects a 71.29% efficiency
ratio, compared to a September 30, 2003 quarter end efficiency ratio of
73.6%. Moxley noted, "The net interest margin for the quarter remained
relatively steady at 4.09%, compared to FirstBank's net interest margin of
4.21% one year ago. We are pleased with earnings per share of $0.52 per
diluted shares at December 31, 2003. Given the impact of the previously
referenced charges, future earnings should improve."
Non-interest income consisted of gain on sale of loans of $286,000,
mortgage servicing fees of $19,000, service charges of $851,000, and other
income of $70,000. "Non interest income may be adversely affected going
forward with respect to loan fee income because of the reduced volume of
refinancing," noted Conklin. "However, the purchase money market has remained
strong, and improved market shares are expected in Boise, Idaho and Spokane,
Washington."
Allowance for loan and lease losses was $6,597,000 as of December 31,
2003. Total allowance reserves represented 1.44% of net loans and 452.47% of
non-performing assets as of that date. Non-performing assets totaled
$2,597,000 at December 31, 2003, which represented 0.52% of total loans. "We
continue to manage the existing portfolio of classified assets and have
realized minimal additions to the classified portfolio, but we have some
credits that were down graded into the non-performing category, as well as
some upgrades," said Conklin. Real estate owned comprised $911,000 of the
total non-performing portfolio. Total charge-offs for the quarter ending
December 31, 2003 were $128,823. "Allowances for loan and lease losses remain
more than adequate for the level of non-performing assets," continued Conklin.
"Material improvement in the non-performing portfolio is not anticipated until
sustainable economic recovery is realized in largely the natural resource
based industry."
Total loans at December 31, 2003 were $494.8 million. The loan portfolio
consists of $119.5 million in residential real estate loans, or 24% of the
total loan portfolio; $189.0 million in commercial loans (including real
estate), or 38% of the total loan portfolio; $51.3 million in agricultural
loans, or 10% of the total loan portfolio; $64.1 million in construction
loans, or 13% of the total loan portfolio; and $70.9 million in consumer and
other loans, or 15% of the total loan portfolio. Total loans at fiscal year
end March 31, 2003 on a pro forma basis for the combined companies were
$511.2 million. The loan portfolio is down $16.4 million, which is
attributable to a reduction of $32.1 million in residential real estate loans
and related loan assets as a result of refinancing activity, and a reduction
of $8.4 million in consumer and other loans, which includes home equity loans.
"Residential real estate loans refinanced out of the portfolio were sold into
the secondary market," said Conklin. "Refinancing has slowed substantially
over the most recent quarter. We are expecting the loan portfolio to
stabilize in the fourth fiscal quarter because of the slowing refinances and
an improving commercial loan market as economic activity picks up. We have new
lending staff in place in the Boise market to augment our other lending
facilities, and we certainly expect that loan growth will be realized as we
get refocused on production in all of our market areas."
Total deposits at December 31, 2003 were $474.5 million. Core deposits
were $271.4 million, or 60.2%, and time deposits were $179.1, or 39.8%. The
total loans to deposit ratio as of December 31, 2003 was 104.3%. Federal Home
Loan Bank borrowings were $134.1 million, and brokered CDs were $23.8 million
on December 31, 2003.
FirstBank Northwest currently has seventeen branches in Washington, Idaho
and Oregon, and two new branches scheduled to open in January and February
2004. The new branches will be located in Hayden, Idaho and Boise, Idaho.
"We expect all branches to focus on deposit growth with emphasis on core
deposits," said Conklin. "The two new branches should certainly enhance our
ability to attain our deposit objectives."
As of December 31, 2003, total tangible equity was $49.9 million, total
tangible equity to total tangible assets was 7.50%, and the risk based capital
ratio was 11.2%. Conklin concluded, "FirstBank is much larger and positioned
to capitalize on the strengths of the combined companies. As we continue to
realize expense savings throughout the integration process and focus on our
strategic growth opportunities, we are optimistic that net income will
continue to grow, thereby enhancing shareholder value."
FirstBank NW Corp. is the parent company of FirstBank Northwest. Founded
in 1920, FirstBank is headquartered in Clarkston, Washington and is a
Washington State Chartered Savings Bank. FirstBank common stock trades on the
Nasdaq National Market under the symbol "FBNW". FBNW shares closed at
$30.50 per share, or 170% of book value and 13.9 times the trailing twelve
month earnings on January 27, 2004.
Certain matters in this News Release may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements may relate to, among others,
expectations of the business environment in which FirstBank operates,
projections of future performance, including operating efficiencies, perceived
opportunities in the market, potential future credit experience and statements
regarding FirstBank's mission and vision. These forewarned-looking statements
are based upon current management expectations, and may, therefore, involve
risks and uncertainties. FirstBank's actual results, performance, and
achievements may differ materially from those suggested, expressed or implied
by forward-looking statements due to a wide range of actors including, but not
limited to, the general business environment, interest rates, the real estate
market in Washington, Idaho and Oregon, the demand for mortgage loans,
FirstBank's ability to successfully integrate the business of Oregon Trail,
the realization of expected cost savings or accretion to earnings because of
the acquisition of Oregon Trail, competitive conditions between banks and
non-bank financial service providers, regulatory changes, and other risks
detailed in the Company's reports filed with the Securities and Exchange
Commission, including its Annual Report on From 10-KSB for the fiscal year
ended March 31, 2003.
FIRSTBANK NW CORP
FINANCIAL HIGHLIGHTS
(unaudited) (in thousands except share and per share data)
Three Months Ended Nine Months Ended
December 31, December 31,
2003 2002 2003 2002
Interest Income $8,011 $5,266 $18,116 $15,495
Interest Expense 2,795 2,191 6,866 6,669
Provision for Loan Losses 162 359 418 797
Net Interest Income After
Provision for Loan Losses 5,054 2,716 10,832 8,029
Non-Interest Income
Gain on sale of loans 286 608 1,656 1,532
Gain on sale of 0 0 0 0
securities, net
Mortgage Servicing Fees 19 50 63 142
Service fees and charges 851 451 1,919 1,410
Commission and other 70 39 136 122
Total Non-Interest Income 1,226 1,148 3,774 3,206
Non-Interest Expenses
Compensation and Related
Expenses 2,854 1,822 6,729 5,287
Occupancy 591 307 1,289 933
Other 1,278 752 2,997 2,295
Total Non-Interest Expense 4,723 2,881 11,015 8,515
Income Tax Expense 276 264 837 725
Net Income $1,281 $719 $2,754 $1,995
Basic Earnings per Share $0.56 $0.56 $1.70 $1.55
Diluted Earnings per Share $0.52 $0.55 $1.59 $1.49
Weighted Average Shares
Outstanding- Basic 2,285,027 1,281,290 1,621,314 1,290,530
Weighted Average Shares
Outstanding- Diluted 2,483,620 1,313,479 1,731,498 1,338,698
Actual Shares Issued 2,862,331 1,380,992 2,862,331 1,380,992
December 31, March 31, December 31,
2003 2003 2002
Total Assets $684,473 $332,398 $325,878
Cash and Cash Equivalents $23,464 $24,741 $15,828
Loans Receivable, net $459,540 $257,019 $260,118
Mortgage-Backed Securities $80,124 $9,618 $10,442
Investment Securities $39,726 $16,813 $16,581
Stock in FHLB, at cost $12,224 $5,731 $5,637
Deposits $474,480 $214,340 $209,703
FHLB Advances & Other
Borrowings $134,056 $81,816 $81,565
Stockholders' Equity $68,910 $30,064 $29,422
Tangible Book Value
per Share (1) $17.94 $23.24 $22.73
FASB 115 Adjustment
after Taxes $1,166 $1,035 $1,087
Tangible Equity /
Total Tangible Assets 7.50% 9.04% 9.03%
Tier 1 Capital to
Average Assets 8.25% 8.40% 8.25%
Risk-based Capital
to Risk-Weighted Assets 11.20% 13.09% 13.01%
Number of full-time
equivalent Employees 248 137 137
(1) Calculation is based on number of shares outstanding at the end of the
period rather than weighted average shares outstanding and excludes
unallocated shares in the employee stock ownership plan (ESOP)
12/03 -- 81,238 shares, 3/03 -- 87,511 shares, 12/02 -- 88,051 shares.
FINANCIAL STATISTICS
(ratios annualized) Three Months Fiscal Nine Months
Ended Year Ended Ended
December 31, March 31, December 31,
2003 2002 2003 2003 2002
Return on Average Assets 0.90% 0.88% 0.87% 0.88% 0.84%
Return on Average Tangible
Equity 11.46% 9.75% 9.49% 10.43% 9.19%
Average Tangible
Equity/Average Tangible
Assets 7.98% 8.98% 9.16% 8.56% 9.17%
Average Equity/
Average Assets 9.95% 8.98% 9.16% 9.53% 9.17%
Average Tangible
Equity/Average Loans 11.48% 11.52% 12.00% 12.10% 11.73%
Efficiency Ratio (2) 71.29% 66.20% 68.04% 71.26% 68.58%
Non-Interest Expenses /
Average Assets 3.30% 3.51% 3.57% 3.53% 3.60%
Net Interest Margin (3) 4.09% 4.21% 4.16% 4.07% 4.18%
Average Interest Earning
Assets / Average Deposits and
Other Borrowed Funds 113.61% 103.99% 114.96% 114.68% 104.28%
Three Months Fiscal Nine Months
Ended Year Ended Ended
December 31, March 31, December 31,
2003 2003 2002
LOANS
(unaudited) (in thousands except share and per share data)
LOAN ORIGINATIONS (4):
Residential loan centers $194,594 $206,806 $154,441
Consumer loan centers 9,012 12,861 10,146
Agricultural loan centers 20,875 27,377 19,911
Commercial loan centers 101,678 96,525 87,127
Total Loan Origination $326,159 $343,569 $271,625
LOAN PORTFOLIO ANALYSIS:
Real estate loans:
Residential $112,556 $50,781 $60,739
Construction 64,146 46,836 40,954
Agricultural 20,246 15,921 16,475
Commercial 122,017 68,125 68,696
Total real estate loans 318,965 181,663 186,864
Consumer and other loans:
Home equity 19,667 19,924 21,679
Agricultural operating 31,031 13,000 14,736
Commercial 66,965 50,603 48,989
Other consumer 51,252 7,843 8,164
Total consumer and
other loans 168,915 91,370 93,568
Loans held for sale-
residential real estate 6,890 5,214
Total Loans Receivable $494,770 $278,247 $280,432
Nine Months Fiscal Year Nine Months
Ended Ended Ended
December 31, March 31, December 31,
2003 2003 2002
ALLOWANCE FOR LOAN LOSSES:
Balance at Beginning
of Period $3,414 $2,563 $2,563
Purchased $2,863 $0 $0
Provision for Loan Losses 418 1,033 797
Charge offs
(Net of Recoveries) (98) (182) (170)
Balance at End of Period $6,597 $3,414 $3,190
Loan Loss Allowance/
Net Loans 1.44% 1.33% 1.23%
Loan Loss Allowance/
Non-Performing Loans 452.47% 272.90% 185.14%
(2) Calcuation is non-interest expense divided by tax equivalent
non-interest income and net interest income.
(3) Calcuation is tax equivalent net interest income divided by total
interest-earning assets.
(4) Loan originations are based upon new production.
NON-PERFORMING ASSETS:
Nine Months Fiscal Year Nine Months
Ended Ended Ended
December 31, March 31, December 31,
2003 2003 2002
Accruing Loans --
90 Days Past Due $0 $0 $0
Non-accrual Loans 1,458 1,251 1,723
Total Non-performing Loans 1,458 1,251 1,723
Restructured Loans on Accrual 228 442 412
Real Estate Owned (REO) 911 120 58
Repossessed assets 28 0 0
Total Non-performing Assets $2,597 $1,813 $2,193
Total Non-performing
Assets/Total Assets 0.38% 0.55% 0.67%
Loan and REO Loss Allowance
as a % of
Non-Performing Assets 254.02% 188.31% 145.46%
AVERAGE BALANCES, INTEREST AVERAGE YIELDS/COSTS
Three Months Ended Fiscal Year Nine Months
Ended Ended Ended
December 31, March 31, December 31,
2003 2002 2003 2003 2002
Average Interest Earning Assets:
Average Loans receivable:
Average Mortgage Loans
receivable $91,482 $60,643 $55,975 $62,030 $59,501
Average Commercial Loans
receivable 163,955 111,669 109,559 136,578 106,046
Average Construction
Loans receivable 35,980 23,287 19,750 34,359 16,929
Average Consumer Loans
receivable 54,210 30,586 31,085 34,366 31,859
Average Agricultural
Loans receivable 43,436 31,793 30,894 35,046 31,307
Average unearned loan
fees and discounts,
allowance for loan
losses, and other (7,187) (4,091) (3,814) (5,598) (3,638)
Total Average Loans
receivable, net 381,876 253,887 243,449 296,781 242,004
Average Loans Held for
Sale 7,345 2,170 6,483 8,185 4,586
Average Mortgage-backed
securities 46,500 10,753 10,832 21,374 11,068
Average Investment
securities 26,671 15,505 14,554 20,321 13,847
Average Other earning
assets 54,676 22,402 21,540 32,486 22,208
Total Average Interest
Earning Assets 517,068 304,717 296,858 379,147 293,713
Average Non-Interest
Earning Assets 55,311 23,567 21,880 36,783 21,845
Total Average Assets $572,379 $328,284 $318,738 $415,930 $315,558
Average Interest Bearing
Liabilities:
Average Passbook, NOW,
and money market
accounts $174,430 $70,931 $67,522 $107,912 $66,665
Average Certificate of
deposits 172,611 110,403 108,406 132,855 107,993
Average Advances from
FHLB and other 108,067 81,358 82,292 89,842 81,508
Total Average Interest
Bearing Liabilities 455,108 262,692 258,220 330,609 256,166
Average Non-Interest
Bearing Deposits 52,399 30,338 26,140 39,422 25,499
Average Deposits and
Other Borrowed Funds 507,507 293,030 284,360 370,031 281,665
Average Non-Interest
Bearing Liabilities 7,946 5,758 5,169 6,253 4,958
Total Average
Liabilities 515,453 298,788 289,529 376,284 286,623
Total Average Equity 56,926 29,496 29,209 39,646 28,935
Total Average
Liabilities and Equity $572,379 $328,284 $318,738 $415,930 $315,558
Total Tangible Average
Equity $44,701 $29,496 $29,209 $35,221 $28,935
Interest Rate Yield on
Earning Assets 6.36% 7.08% 7.10% 6.53% 7.21%
Interest Rate Expense on
Deposits and Other
Borrowed Funds 2.64% 2.99% 3.37% 2.85% 3.16%
Interest Rate Spread 3.72% 4.09% 3.73% 3.68% 4.05%
Net Interest Margin 4.09% 4.21% 4.16% 4.07% 4.18%
SOURCE FirstBank NW Corp.
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Related links:
http://www.fbnw.com
CONTACT:
Larry K. Moxley, Exec. VP & CFO of FirstBank
NW Corp., +1-509-295-5100
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