JOHNSTOWN, Pa., April 18 /PRNewswire-FirstCall/ -- AmeriServ Financial,
Inc. (Nasdaq: ASRV) reported net income of $540,000 or $0.02 per diluted
share for the first quarter of 2006. This compares to net income of
$833,000 or $0.04 per diluted share for the first quarter of 2005. Note
that for comparative purposes the first quarter 2005 results included a
one-time income tax benefit of $475,000. There was no such tax benefit in
the first quarter of 2006. The following table highlights the Company's
financial performance for the quarters ended March 31, 2006 and 2005:
First Quarter First Quarter
2006 2005
Income before taxes $676,000 $401,000
Net income $540,000 $833,000
Diluted earnings 0.02 0.04
per share
Allan R. Dennison, President and Chief Executive Officer, commented on
the first quarter 2006 results, "AmeriServ's first quarter 2006 financial
performance is beginning to show the benefits of our focus on traditional
community banking and the balance sheet restructuring completed in 2005.
Average loans and deposits in the first quarter of 2006 both grew
approximately 5.7% when compared to the first quarter of 2005. This growth
combined with significant reductions in both investment securities and
borrowings caused our net interest margin to increase by 45 basis points to
3.20% in the first quarter of 2006. Other first quarter 2006 performance
highlights include stable asset quality, reduced non-interest expenses, and
strong growth in trust revenues."
Overall, the Company generated a comparable level of net interest
income from a smaller, but stronger balance sheet in the first quarter of
2006. The Company's net interest income in the first quarter of 2006 was
essentially flat with the prior year first quarter as the benefits from an
increased net interest margin offset a reduced level of earning assets.
Specifically, the net interest margin increased by 45 basis points to 3.20%
while the level of average earning assets declined by $132 million or
14.4%. Both of these items reflect the deleverage of high cost debt from
the Company's balance sheet which has resulted in lower levels of both
borrowed funds and investment securities. The Company's net interest margin
also benefited from increased loans in the earning asset mix as total loans
outstanding averaged $549 million in the first quarter of 2006, a $30
million or 5.7% increase from the prior year first quarter. This loan
growth occurred in the commercial loan portfolio as a result of successful
new business development efforts. Total deposits averaged $719 million in
the first quarter of 2006, a $39 million or 5.7% increase from 2005 due
largely to increased deposits from the trust company's operations. This
deposit growth also allowed the Company to further reduce FHLB borrowings
as these wholesale borrowings averaged only 5.7% of total assets in the
first quarter of 2006 compared to 20.9% of total assets in the first
quarter of 2005.
The Company did not record a provision for loan losses in either the
first quarter of 2006 or the first quarter of 2005 due to the Company's
continuing sound asset quality. Non-performing assets have remained
relatively stable in a range of $3.3 to $4.3 million for the past five
quarters and ended the first quarter of 2006 at $4.2 million or 0.76% of
total loans. Net charge-offs in the first quarter of 2006 amounted to
$117,000 or 0.09% of total loans which was up from the net charge-offs of
$60,000 or 0.05% of total loans in the prior year first quarter. The
allowance for loan losses provided 215% coverage of non-performing assets
at March 31, 2006 compared to 212% coverage at December 31, 2005, and 258%
coverage at March 31, 2005. The allowance for loan losses as a percentage
of total loans amounted to 1.65% at March 31, 2006.
The Company's non-interest income in the first quarter of 2006
increased by $94,000 or 3.0% from the prior year first quarter due to
strong growth in trust revenue and increased deposit service charges. Trust
fees increased by $169,000 or 11.5% due to continued successful new
business development efforts in both the union and traditional trust
product lines. Trust assets under management totaled $1.67 billion at March
31, 2006. Deposit service charges grew by $43,000 or 7.4% due to increased
checking service charges and overdraft penalty fees. These positive items
were partially offset by fewer gains on asset sales in the first quarter of
2006. Specifically, the Company realized no gains on investment security
sales in the first quarter of 2006 compared to $78,000 of investment
security gains realized in the first quarter of 2005. There was also a
$49,000 decrease in gains realized on loan sales into the secondary market
due to weaker residential mortgage loan production in the first quarter of
2006.
The Company's total non-interest expense in the first quarter of 2006
decreased by $85,000 when compared to the first quarter of 2005 reflecting
the Company's continued focus on reducing and containing non-interest
expenses. Expense reductions were experienced in numerous categories
including occupancy expense, professional fees, and other expenses. Also,
the loss from discontinued operations declined from $65,000 in the first
quarter of 2005 to $0 in the first quarter of 2006 as the Company completed
the exit from its mortgage servicing operation in 2005.
The Company recorded a more typical income tax expense of $136,000 in
the first quarter of 2006. The Company's first quarter 2005 net income
performance was favorably impacted by an income tax benefit. Specifically
in the first quarter of 2005, the Company lowered its income tax expense by
$475,000 due to a reduction in reserves for prior year tax contingencies as
a result of the successful conclusion of an IRS examination on several open
tax years.
At March 31, 2006, ASRV had total assets of $876 million and
shareholders' equity of $84 million or $3.81 per share. The Company's asset
leverage ratio improved to 10.36% at March 31, 2006 compared to 9.77% at
March 31, 2005.
This news release may contain forward-looking statements that involve
risks and uncertainties, as defined in the Private Securities Litigation
Reform Act of 1995, including the risks detailed in the Company's Annual
Report and Form 10-K to the Securities and Exchange Commission. Actual
results may differ materially.
NASDAQ NMS: ASRV
SUPPLEMENTAL FINANCIAL PERFORMANCE DATA
April 18, 2006
(In thousands, except per share and ratio data)
(All quarterly and 2006 data unaudited)
2006
1QTR
PERFORMANCE DATA FOR THE PERIOD:
Net income $540
PERFORMANCE PERCENTAGES (annualized):
Return on average equity 2.59%
Net interest margin 3.20
Net charge-offs as a percentage of average loans 0.09
Loan loss provision as a percentage of average loans -
Efficiency ratio 92.68
PER COMMON SHARE:
Net income:
Basic $0.02
Average number of common shares outstanding 22,119
Diluted 0.02
Average number of common shares outstanding 22,127
2005
1QTR 2QTR 3QTR 4QTR YEAR TO DATE
PERFORMANCE DATA FOR THE
PERIOD:
Net income (loss) $833 $370 ($10,564) $220 $(9,141)
PERFORMANCE PERCENTAGES
(annualized):
Return on average equity 3.95% 1.75% (49.42)% 1.03% (10.77)%
Net interest margin 2.75 2.63 2.43 3.21 2.76
Net charge-offs as a
percentage of average
loans 0.05 0.06 0.11 0.21 0.11
Loan loss provision as a
percentage of average
loans - (0.21) 0.08 - (0.03)
Efficiency ratio 94.42 96.81 362.60 96.65 143.54
PER COMMON SHARE:
Net income (loss):
Basic $0.04 $0.02 $(0.53) $0.01 $(0.45)
Average number of common
shares outstanding 19,721 19,726 19,785 22,109 20,340
Diluted 0.04 0.02 (0.53) 0.01 (0.45)
Average number of common
shares outstanding 19,760 19,765 19,785 22,123 20,340
AMERISERV FINANCIAL, INC.
(In thousands, except per share, statistical, and ratio data)
(All quarterly and 2006 data unaudited)
2006
1QTR
PERFORMANCE DATA AT PERIOD END:
Assets $876,393
Investment securities 223,658
Loans 548,466
Allowance for loan losses 9,026
Goodwill and core deposit intangibles 12,031
Deposits 727,987
Stockholders' equity 84,336
Trust assets - fair market value (B) 1,669,525
Non-performing assets 4,193
Asset leverage ratio 10.36%
PER COMMON SHARE:
Book value (A) $3.81
Market value 5.00
Market price to book value 131.26%
STATISTICAL DATA AT PERIOD END:
Full-time equivalent employees 375
Branch locations 22
Common shares outstanding 22,140,172
2005
1QTR 2QTR 3QTR 4QTR
PERFORMANCE DATA AT PERIOD
END:
Assets $996,450 $996,786 $901,194 $880,176
Investment securities 381,124 385,398 253,082 231,924
Loans 527,344 522,437 544,900 550,602
Allowance for loan losses 9,856 9,480 9,435 9,143
Goodwill and core deposit
intangibles 12,896 12,680 12,464 12,247
Deposits 725,369 691,740 698,297 712,655
Stockholders' equity 83,720 86,267 85,022 84,474
Trust assets - fair market
value (B) 1,465,028 1,487,496 1,600,968 1,606,978
Non-performing assets 3,819 3,334 3,323 4,316
Asset leverage ratio 9.77% 9.92% 9.90% 10.24%
PER COMMON SHARE:
Book value $4.24 $4.37 $3.85 $3.82
Market value 5.61 5.35 4.35 4.38
Market price to book value 132.35% 122.36% 113.07% 114.65%
STATISTICAL DATA AT
PERIOD END:
Full-time equivalent
employees 394 383 384 378
Branch locations 22 22 22 22
Common shares outstanding 19,722,884 19,729,678 22,105,786 22,112,273
Note:
(A) Other comprehensive income had a negative impact of $0.22 on book
value per share at March 31, 2006.
(B) Not recognized on the balance sheet
AMERISERV FINANCIAL, INC.
CONSOLIDATED STATEMENT OF INCOME
(In thousands)
(All quarterly and 2006 data unaudited)
2006
1QTR
INTEREST INCOME
Interest and fees on loans $8,900
Total investment portfolio 2,279
Total Interest Income 11,179
INTEREST EXPENSE
Deposits 4,026
All other funding sources 861
Total Interest Expense 4,887
NET INTEREST INCOME 6,292
Provision of loan losses -
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 6,292
NON-INTEREST INCOME
Trust fees 1,641
Net realized gains on investment
securities available for sale -
Net realized gains on loans held for sale 23
Service charges on deposit accounts 627
Bank owned life insurance 256
Other income 695
Total Non-Interest Income 3,242
NON-INTEREST EXPENSE
Salaries and employee benefits 4,815
Net occupancy expense 655
Equipment expense 639
Professional fees 795
FDIC deposit insurance expense 73
Amortization of core deposit intangibles 216
Other expenses 1,665
Total Non-Interest Expense 8,858
INCOME BEFORE INCOME TAXES 676
Provision for income taxes 136
NET INCOME $540
AMERISERV FINANCIAL, INC.
CONSOLIDATED STATEMENT OF INCOME
(In thousands)
(All quarterly and 2006 data unaudited)
2005
1QTR 2QTR 3QTR 4QTR YEAR
TO DATE
INTEREST INCOME
Interest and fees on loans $7,954 $8,105 $8,200 $8,688 $32,947
Total investment portfolio 3,737 3,607 3,273 2,301 12,918
Total Interest Income 11,691 11,712 11,473 10,989 45,865
INTEREST EXPENSE
Deposits 2,845 3,188 3,290 3,662 12,985
All other funding sources 2,551 2,533 2,725 959 8,768
Total Interest Expense 5,396 5,721 6,015 4,621 21,753
NET INTEREST INCOME 6,295 5,991 5,458 6,368 24,112
Provision of loan losses - (275) 100 - (175)
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 6,295 6,266 5,358 6,368 24,287
NON-INTEREST INCOME
Trust fees 1,472 1,506 1,586 1,565 6,129
Net realized gains (losses) on
investment securities
available for sale 78 - (2,577) - (2,499)
Net realized gains on loans
held for sale 72 83 27 27 209
Service charges on deposit
accounts 584 704 723 689 2,700
Bank owned life insurance 250 254 256 257 1,017
Other income 692 633 643 685 2,653
Total Non-Interest Income 3,148 3,180 658 3,223 10,209
NON-INTEREST EXPENSE
Salaries and employee benefits 4,751 4,680 4,804 4,827 19,062
Net occupancy expense 668 592 609 683 2,552
Equipment expense 639 622 620 628 2,509
Professional fees 823 938 1,483 998 4,242
FDIC deposit insurance expense 71 69 76 73 289
Amortization of core deposit
intangibles 216 216 216 217 865
Prepayment penalties - - 12,287 - 12,287
Other expenses 1,775 1,789 2,183 1,867 7,614
Total Non-Interest Expense 8,943 8,906 22,278 9,293 49,420
INCOME (LOSS) BEFORE INCOME
TAXES 500 540 (16,262) 298 (14,924)
Provision (benefit) for income
taxes (398) 96 (5,689) 89 (5,902)
Income (loss) from continuing
operations $898 $444 $(10,573) $209 $(9,022)
Income (loss) from discontinued
operations (65) (74) 9 11 (119)
NET INCOME (LOSS) $833 $370 $(10,564) $220 $(9,141)
AMERISERV FINANCIAL, INC.
AVERAGE BALANCE SHEET DATA
(In thousands)
(All quarterly and 2006 data unaudited)
Note: 2005 data appears before 2006.
2005 2006
1QTR 1QTR
Interest earning assets:
Loans and loans held for sale, net of
unearned income $519,386 $548,975
Deposits with banks 1,320 564
Total investment securities 395,894 234,729
Total interest earning assets 916,600 784,268
Non-interest earning assets:
Cash and due from banks 22,142 19,230
Premises and equipment 9,682 8,617
Assets of discontinued operations 1,832 -
Other assets 63,173 69,831
Allowance for loan losses (9,867) (9,069)
Total assets 1,003,562 872,877
Interest bearing liabilities:
Interest bearing deposits:
Interest bearing demand 53,757 55,804
Savings 99,608 86,721
Money market 144,895 175,733
Other time 277,080 295,951
Total interest bearing deposits 575,340 614,209
Borrowings:
Federal funds purchased, securities
sold under agreements to repurchase,
and other short-term borrowings 109,121 48,677
Advanced from Federal Home Loan Bank 101,022 983
Guaranteed junior subordinated
deferrable interest debentures 20,285 13,085
Total interest bearing liabilities 805,768 676,954
Non-interest bearing liabilities:
Demand deposits 104,842 105,004
Liabilities of discontinued operations 636 -
Other liabilities 6,700 6,537
Stockholders' equity 85,616 84,382
Total liabilities and stockholders' equity $1,003,562 $872,877
SOURCE AmeriServ Financial, Inc.
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Related links:
http://www.ameriservfinancial.com/
CONTACT:
Jeffrey A. Stopko, Senior Vice President &
Chief Financial Officer of AmeriServ Financial, Inc.,
+1-814-533-5310
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