WEST PALM BEACH, Fla., April 16 /PRNewswire-FirstCall/ --
Fidelity Bankshares, Inc. (Nasdaq: FFFL) the holding company for Fidelity
Federal Bank & Trust, announced today the company's net income for the first
quarter ended March 31, 2003 was $5.1 million or $.36 basic and $.35 diluted
earnings per share. This compared with $4.0 million or $.26 basic and diluted
earnings per share for the quarter ended March 31, 2002.
The first quarter 2003 results were impacted by the sales of $84 million
of the bank's loans that produced a pre-tax profit of nearly $2.6 million.
This included a non-recurring gain on a sale of $50 million of loans with a
pre-tax profit of $1.5 million ($925,000 or $.06 per share after tax). The
balance of $34 million represented the company's commencement of loan sales
into the secondary markets. The company has initiated the loan sales program
to provide additional non-operating income, reduce interest rate risk and as a
capital management tool.
Compared with a net yield of 3.63% on average interest earning assets
during the quarter ended December 31, 2002, the company experienced margin
compression to 3.51% during the first quarter of 2003. As of March 31, 2003,
the company's net yield on interest earning assets was 3.43%.
This drop in net yields had two causes. While the company was able to
originate nearly $274 million in new loans for the quarter, the company sold
$84 million in loans and experienced repayments of $171 million. This
increased the loan portfolio by only $19 million to $1.955 billion as of March
31, 2003. In addition, new deposits, which reflected net deposit growth of
$229.7 million for the quarter, were invested in short-term, temporary
investments and interest earning deposits at much lower yields than retail
loans, further contributing to the company's decrease in margins.
Chairman and CEO Vince Elhilow said, "Like many other community banks and
thrifts, we experienced margin compression driven by mortgage refinancings
from home owners seeking lower rates. But we again showed solid improvement in
our balance sheet. Core deposits consisting of checking, savings and money
market accounts are growing. They now comprise 64.4% of total deposits, while
certificates of deposit represent 35.6%. At December 31, 2002 and March 31,
2002, core deposits made up 59.6% and 52.0%, respectively, of the company's
deposits. We are continuing our aggressive core deposit expansion program.
While in the short-term this could contribute to further margin compression,
we expect loan prepayments to begin to subside later in the year. As this
occurs, we plan to replace short-term investments and interest bearing
deposits with higher yielding retail loans. We believe we are better prepared
than ever to benefit from the inevitable increases in interest rates. In the
meantime our bottom line has benefited from our new loan sales program."
In March, the Board of Directors approved payment of a quarterly dividend
to stockholders of $.10 per share on the company's common stock. The
dividend, payable to stockholders of record as of March 31, 2003, was
distributed on April 15, 2003.
Fidelity Bankshares, Inc., through its subsidiary Fidelity Federal Bank &
Trust, has assets of $2.7 billion and deposits of $2.1 billion and operates in
Florida through 42 offices in Palm Beach, Martin and St. Lucie counties.
An investment profile on Fidelity Bankshares may be found on the website
http://www.hawkassociates.com/fffl/profile.htm.
For more information contact President and CEO Vince A. Elhilow or Chief
Financial Officer Richard D. Aldred at (561) 803-9900 or Frank Hawkins or
Julie Marshall, Hawk Associates, Inc. at (305) 852-2383. Email:
info@hawkassociates.com. Information about Fidelity Bankshares, Inc. can be
found on the website http://www.fidelityfederal.com. Copies of Fidelity Bankshares
press releases, SEC filings, current price quotes, stock charts and other
valuable information for investors may be found on the website:
http://www.hawkassociates.com.
Fidelity Bankshares, Inc.
Financial Highlights
(Unaudited)
Three Months Three Months Year
Ended Ended Ended
March 31, March 31, December 31,
2003 2002 2002
FOR THE PERIOD (In Thousands)
Interest income $34,831 $33,677 $137,867
Interest expense 14,046 15,865 61,768
Net interest income 20,785 17,812 76,099
Chargeoffs 71 16 575
Recoveries -- 6 60
Gain on sale of loans 2,559 22 74
Net income 5,117 4,008 16,798
PER COMMON SHARE
Net income:
Basic EPS $0.36 $0.26 $1.12
Diluted EPS 0.35 0.26 1.11
Dividends declared 0.10 0.10 0.40
Book value 11.59 11.40 11.37
Stock price:
High 19.75 18.42 19.35
Low 17.24 15.60 17.20
Close 18.32 18.00 17.90
AVERAGE FOR THE PERIOD (In
Thousands)
Assets $2,569,884 $2,249,987 $2,349,524
Loans receivable, net 1,954,221 1,614,670 1,745,639
Mortgage-backed securities 211,236 227,155 193,510
Investments 204,177 247,108 229,660
Deposits 2,000,362 1,650,238 1,752,316
Borrowed funds 340,313 374,995 372,000
Stockholders' equity 170,908 179,782 177,009
SELECTED RATIOS
Return on average assets 0.80% 0.71% 0.71%
Return on average equity 11.98% 8.92% 9.49%
Interest rate spread on average
assets for the period 3.48% 3.32% 3.45%
Net yield on average interest
earning assets for the period 3.51% 3.41% 3.51%
Net yield on interest earning
assets at end of period 3.43% 3.30% 3.63%
Interest rate spread at end of
period 3.41% 3.20% 3.60%
Ratio of interest earning assets
to interest bearing
liabilities at
end of period 100.81% 103.17% 101.01%
Ratio of non performing assets to
total assets 0.22% 0.26% 0.27%
Ratio of valuation allowances to
non performing assets 150.82% 120.88% 126.21%
Ratio of valuation allowances to
loans receivable, net 0.46% 0.44% 0.43%
Stockholders' equity as a
percentage of assets 6.40% 7.66% 6.93%
PERIOD END (In Thousands)
Total assets $2,699,347 $2,348,840 $2,439,397
Interest earning cash and
investment securities 160,453 305,792 166,286
Mortgage-backed and corporate debt
securities 384,199 211,581 145,139
Loans receivable, net 1,955,141 1,664,966 1,935,999
Real estate owned and held for
investment 726 73 --
Loan loss reserve 9,036 7,338 8,318
Other assets 45,753 37,398 41,528
Borrowed funds 337,825 378,901 326,537
Common shares outstanding, net of
treasury shares 14,899,818 15,790,056 14,860,327
Stockholders' equity 172,640 179,959 169,087
Certain amounts in prior year have been reclassified to conform with
the March 31, 2003 presentation.
Fidelity Bankshares Inc.
Selected Unaudited Operating Data
Three Months Ended
March 31,
2003 2002
(In Thousands)
Selected Operating Data:
Interest income $34,831 $33,677
Interest expense 14,046 15,865
Net interest income before
provision for loan losses 20,785 17,812
Provision for loan losses 790 501
Net interest income after
provision for loan losses 19,995 17,311
Other income
Fees on deposit accounts 1,902 1,618
Fees for other banking services 2,294 1,831
All other income 2,815 272
Total other income 7,011 3,721
Operating expense
Compensation and benefits 11,096 8,495
Occupancy and equipment 2,388 2,009
All other operating expense 5,176 3,925
Total operating expense 18,660 14,429
Income before taxes 8,346 6,603
Provision for income taxes 3,229 2,595
Net income $5,117 $4,008
Earnings per share:
Basic $.36 $.26
Diluted $.35 $.26
Certain amounts in prior year have been reclassified to conform with
the March 31, 2003 presentation.
Fidelity Bankshares Inc.
Selected Unaudited Financial Data
March 31, December 31,
2003 2002
(In Thousands)
Assets
Cash and interest earning deposits $163,130 $129,666
Assets available for sale 435,007 235,018
Loans:
Residential mortgage 1,440,284 1,456,483
Commercial mortgage 509,137 459,055
Consumer 148,908 141,343
Commercial business 127,630 146,206
Gross loans 2,225,959 2,203,087
Less:
Loans in process 262,575 260,382
Deferred costs (income) (793) (1,612)
Allowance for loan losses 9,036 8,318
Loans, Net 1,955,141 1,935,999
Office properties and equipment 68,397 67,784
FHLB stock 13,874 12,919
REO 726 --
All other assets 63,072 58,011
Total assets $2,699,347 $2,439,397
Liabilities and Equity
Liabilities:
Deposits:
Checking, savings and money
market accounts $1,370,738 $1,130,586
Certificates of deposit 757,336 767,755
Total deposits 2,128,074 1,898,341
Repurchase agreements 34,109 44,416
Borrowings from FHLB 274,966 253,371
Subordinated debentures 28,750 28,750
All other liabilities 60,808 45,432
Total liabilities 2,526,707 2,270,310
Stockholders' equity 172,640 169,087
Total liabilities and equity $2,699,347 $2,439,397
Certain amounts in prior year have been reclassified to conform with the
March 31, 2003 presentation.
SOURCE Fidelity Bankshares, Inc.
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Related links:
http://www.fidfed.com
Company News On-Call:
http://www.prnewswire.com/gh/cnoc/comp/281429.html
CONTACT:
Vince A. Elhilow, President and CEO or
Richard D. Aldred, Chief Financial Officer, both of Fidelity
Bankshares, Inc., +1-561-803-9900; or Frank Hawkins or Julie
Marshall, both of Hawk Associates, Inc., +1-305-852-2383, or
email, info@hawkassociates.com
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