JOHNSTOWN, Pa., April 20 /PRNewswire-FirstCall/ -- AmeriServ Financial,
Inc. (Nasdaq: ASRV) completed its fourth consecutive quarter of profitability
by reporting net income for the first quarter of 2004 of $226,000 or $0.02 per
diluted share. This represents significant improvement and a sharp turnaround
from the net loss of $795,000 or $0.06 per share reported in the first quarter
of 2003. The following table highlights the Company's financial performance
for the quarters ended March 31, 2004 and 2003:
First Quarter 2004 First Quarter 2003 Change
Net income (loss) $226,000 ($795,000) $1,021,000
Diluted earnings (loss) per share 0.02 (0.06) 0.08
At March 31, 2004, ASRV had total assets of $1.1 billion and shareholders'
equity of $78 million or $5.57 per share. The Company is well capitalized for
regulatory purposes with an asset leverage ratio at March 31, 2004 of 7.75%,
compared to a regulatory minimum of 5.0%.
The Company's net interest income in the first quarter of 2004 decreased
by $435,000 from the prior year first quarter due to a reduced level of
earning assets and a nine basis point decline in the net interest margin to
2.39%. Loan portfolio shrinkage experienced during the majority of 2003 was a
predominant factor contributing to both the lower level of earning assets and
the net interest margin contraction in the first quarter comparisons.
However, when compared to more recent quarterly performance, the Company's net
interest income and net interest margin have demonstrated favorable trends
growing for two consecutive quarters. Specifically, when compared to the
third quarter 2003 when the impact of loan refinancings reached their peak on
the Company's portfolio, the net interest margin has increased from 2.14% to
2.39%. This improvement reflects modest growth in both loans and deposits and
a slow down in premium amortization on the Company's mortgage backed
securities since the third quarter of 2003.
The Company's provision for loan losses totaled $384,000 or 0.31% of total
loans in the first quarter of 2004. This represented a decrease of
$1.3 million from the first quarter 2003 provision of $1.7 million or 1.19% of
total loans. Net charge-offs in the first quarter of 2004 totaled $597,000 or
0.48% of total loans compared to net charge-offs of $279,000 or 0.20% of total
loans in the first quarter of 2003. The higher net charge-offs in the first
quarter of 2004 reflect a $625,000 write-down of a $4.8 million loan on a
personal care facility that was discussed in a previously issued press
release. The Company took possession of the facility and transferred the
property to other real estate owned in the first quarter of 2004. The Company
is currently evaluating bids for the facility and hopes to finalize a sale by
the end of the second quarter of 2004. The Company expects to incur no
further loss on this property.
The Company's allowance for loan losses totaled $11.4 million at March 31,
2004 providing 84% coverage of non-performing assets. Non-performing assets
totaled $13.5 million at March 31, 2004, which represented an increase of
$2.1 million from the December 31, 2003 level of $11.4 million. This increase
reflects the beginning of foreclosure proceedings on a $4.3 million commercial
mortgage loan on a hotel within the Company's primary market area. Overall,
the allowance for loan losses as a percentage of total loans amounted to 2.26%
at March 31, 2004 compared to 2.32% at December 31, 2003, and 2.06% at
March 31, 2003.
The Company's total non-interest income in the first quarter of 2004
increased by $70,000 from the prior year first quarter due to a combination of
several factors. First, the Company realized a $758,000 loss on the sale of
approximately 70% of its mortgage-servicing portfolio in the first quarter of
2003. This significant downsizing of the mortgage-servicing asset reduced the
level of interest rate risk and earnings volatility of the Company. There was
no such loss experienced in the first quarter of 2004. This positive item,
however, was partially offset by fewer gains realized on asset sales in the
first quarter of 2004. These included a $341,000 decrease in gains on
investment security sales and a $133,000 decline in gains realized on the sale
of mortgage loans into the secondary market as result of reduced mortgage
refinancing activity. This lower level of new mortgage origination activity
in the first quarter of 2004 was also the main factor responsible for the
$149,000 decrease in other non-interest income.
The Company's total non-interest expense in the first quarter of 2004
favorably decreased by $449,000 or 4.4% when compared to the first quarter of
2003. The largest factor causing the decrease was a $266,000 reduction in the
impairment charge on mortgage servicing rights due a significantly smaller
mortgage-servicing asset in 2004. The Company also benefited from the non-
recurrence in 2004 of a $199,000 goodwill impairment loss associated with the
write-off of all goodwill within the mortgage-banking segment in the first
quarter of 2003. Excluding these impairment related charges, the remaining
total non-interest expenses were essentially flat between the first quarter of
2003 and first quarter of 2004 reflecting the Company's continued focus on
reducing and containing expenses.
AmeriServ Financial, Inc., is the parent of AmeriServ Financial Bank and
AmeriServ Trust & Financial Services in Johnstown, AmeriServ Associates of
State College, and AmeriServ Life Insurance Company.
This news release may contain forward-looking statements that involve
risks and uncertainties, including the risks detailed in the Company's Annual
Report and Form 10-K to the Securities and Exchange Commission as defined in
the Private Securities Litigation Reform Act of 1995. Actual results may
differ materially.
Nasdaq NMS: ASRV
SUPPLEMENTAL FINANCIAL PERFORMANCE DATA (A)
April 20, 2004
(In thousands, except per share and ratio data)
2004
1QTR
PERFORMANCE DATA FOR THE PERIOD:
Net income $226
PERFORMANCE PERCENTAGES (annualized):
Return on average equity 1.21%
Net interest margin 2.39
Net charge-offs as a percentage of average loans 0.48
Loan loss provision as a percentage of average loans 0.31
Efficiency ratio 93.83
PER COMMON SHARE:
Net income:
Basic $0.02
Average number of common shares outstanding 13,962,010
Diluted 0.02
Average number of common shares outstanding 14,025,836
Cash dividends declared 0.00
2003
YEAR
1QTR 2QTR 3QTR 4QTR TO DATE
PERFORMANCE DATA
FOR THE PERIOD:
Net income
(loss) $(795) $915 $249 $180 $549
PERFORMANCE PERCENTAGES
(annualized):
Return on average
equity (4.17)% 4.84% 1.35% 1.00% 0.74%
Net interest
margin 2.48 2.41 2.14 2.21 2.31
Net charge-offs
as a percentage
of average loans 0.20 0.02 0.33 0.35 0.22
Loan loss provision
as a percentage
of average loans 1.19 0.40 0.30 0.31 0.56
Efficiency ratio 94.98 84.81 94.05 95.15 91.98
PER COMMON SHARE:
Net income (loss):
Basic $(0.06) $0.07 $0.02 $0.01 $0.04
Average number
of common shares
outstanding 13,923,010 13,935,086 13,945,889 13,954,044 13,939,610
Diluted (0.06) 0.07 0.02 0.01 0.04
Average number
of common
shares
outstanding 13,923,010 13,940,460 13,954,648 13,972,328 13,947,895
Cash dividends
declared 0.00 0.00 0.00 0.00 0.00
NOTES:
(A) All quarterly data unaudited.
AMERISERV FINANCIAL, INC.
(In thousands, except per share, statistical, and ratio data)
2004
1QTR
PERFORMANCE DATA AT PERIOD END
Assets $1,099,564
Investment securities 504,980
Loans 503,404
Allowance for loan losses 11,379
Goodwill and core deposit intangibles 13,905
Mortgage servicing rights 1,493
Deposits 656,348
Stockholders' equity 77,721
Trust assets - fair market value 1,256,064
Non-performing assets 13,482
Asset leverage ratio 7.75%
PER COMMON SHARE:
Book value (A) $5.57
Market value 6.10
Market price to book value 109.52%
STATISTICAL DATA AT PERIOD END:
Full-time equivalent employees 415
Branch locations 23
Common shares outstanding 13,965,737
2003
1QTR 2QTR 3QTR 4QTR
PERFORMANCE DATA AT PERIOD END
Assets $1,190,360 $1,167,610 $1,160,915 $1,147,886
Investment securities 546,427 544,967 577,374 552,662
Loans 555,335 525,591 496,951 503,387
Allowance for loan losses 11,415 11,916 11,872 11,682
Goodwill and core deposit 15,337 14,979 14,621 14,263
intangibles
Mortgage servicing rights 2,214 1,784 1,859 1,718
Deposits 669,103 661,932 648,844 654,597
Stockholders' equity 77,864 78,884 75,188 74,270
Trust assets - fair
market value 1,091,391 1,146,695 1,107,022 1,145,660
Non-performing assets 11,687 10,163 11,227 11,411
Asset leverage ratio 7.23% 7.39% 7.48% 7.58%
PER COMMON SHARE:
Book value (A) $5.59 $5.66 $5.39 $5.32
Market value 3.50 3.80 4.17 5.00
Market price to book 62.61% 67.14% 77.37% 93.98%
value
STATISTICAL DATA AT PERIOD END:
Full-time equivalent employees 416 427 422 413
Branch locations 23 23 23 23
Common shares outstanding 13,929,324 13,940,999 13,949,383 13,957,599
NOTES:
(A) Other comprehensive income had a positive impact of $0.16 on book
value per share at March 31, 2004.
AMERISERV FINANCIAL, INC.
CONSOLIDATED STATEMENT OF INCOME
(In thousands)
(Quarterly data unaudited)
2004
INTEREST INCOME 1QTR
Interest and fees on loans $7,691
Total investment portfolio 5,228
Total Interest Income 12,919
INTEREST EXPENSE
Deposits 2,543
All other funding sources 4,164
Total Interest Expense 6,707
NET INTEREST INCOME 6,212
Provision for loan losses 384
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 5,828
NON-INTEREST INCOME
Trust fees 1,267
Net realized gains on investment securities available for sale 937
Net realized gains on loans and loans held for sale 40
Service charges on deposit accounts 730
Net mortgage servicing fees 52
Bank owned life insurance 275
Other income 764
Total Non-interest Income 4,065
NON-INTEREST EXPENSE
Salaries and employee benefits 4,915
Net occupancy expense 757
Equipment expense 704
Professional fees 804
FDIC deposit insurance expense 72
Amortization of core deposit intangibles 358
Impairment charge for mortgage servicing Rights 100
Other expenses 1,961
Total Non-interest Expense 9,671
INCOME BEFORE INCOME TAXES 222
Provision (benefit) for income taxes (4)
NET INCOME $226
2003
YEAR
INTEREST INCOME 1QTR 2QTR 3QTR 4QTR TO DATE
Interest and fees on loans $9,083 $8,595 $8,044 $7,585 $33,307
Total investment portfolio 5,660 5,631 5,035 5,372 21,698
Total Interest Income 14,743 14,226 13,079 12,957 55,005
INTEREST EXPENSE
Deposits 3,140 2,965 2,765 2,633 11,503
All other funding sources 4,956 4,827 4,618 4,456 18,857
Total Interest Expense 8,096 7,792 7,383 7,089 30,360
NET INTEREST INCOME 6,647 6,434 5,696 5,868 24,645
Provision for loan losses 1,659 534 384 384 2,961
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 4,988 5,900 5,312 5,484 21,684
NON-INTEREST INCOME
Trust fees 1,253 1,253 1,254 1,233 4,993
Net realized gains on investment
securities available for sale 1,278 1,420 402 687 3,787
Net realized gains on loans and
loans held for sale 173 221 165 73 632
Service charges on deposit accounts 767 800 812 801 3,180
Net mortgage servicing fees 71 77 55 46 249
Gain (loss) on sale of mortgage
servicing (758) - - - (758)
Bank owned life insurance 298 307 305 304 1,214
Other income 913 1,017 989 713 3,632
Total Non-interest Income 3,995 5,095 3,982 3,857 16,929
NON-INTEREST EXPENSE
Salaries and employee benefits 4,789 4,717 4,729 4,688 18,923
Net occupancy expense 752 701 682 681 2,816
Equipment expense 817 750 692 692 2,951
Professional fees 903 1,058 951 906 3,818
FDIC deposit insurance expense 28 26 75 72 201
Amortization of core deposit
intangibles 358 358 358 358 1,432
Impairment charge (credit) for
mortgage servicing rights 366 254 (230) - 390
Goodwill impairment loss 199 - - - 199
Other expenses 1,908 1,922 1,855 1,862 7,547
Total Non-interest Expense 10,120 9,786 9,112 9,259 38,277
INCOME (LOSS) BEFORE INCOME
TAXES (1,137) 1,209 182 82 336
Provision (benefit) for
income taxes (342) 294 (67) (98) (213)
NET INCOME (LOSS) $(795) $915 $249 $180 $549
AMERISERV FINANCIAL, INC.
Nasdaq NMS: ASRV
Average Balance Sheet Data (In thousands)
(Quarterly Data Unaudited)
Note: 2003 data appears before 2004.
2003 2004
1QTR 1QTR
Interest earning assets:
Loans and loans held for sale, net of
unearned income $557,123 $495,728
Deposits with banks 7,240 4,574
Federal funds sold - 226
Total investment securities 497,836 541,761
Total interest earning assets 1,062,199 1,042,289
Non-interest earning assets:
Cash and due from banks 23,557 22,113
Premises and equipment 12,477 10,983
Other assets 71,235 66,455
Allowance for loan losses (10,272) (11,457)
Total assets $1,159,196 $1,130,383
Interest bearing liabilities:
Interest bearing deposits:
Interest bearing demand $50,550 $51,838
Savings 102,116 105,228
Money market 128,232 120,430
Other time 289,213 274,241
Total interest bearing deposits 570,111 551,737
Borrowings:
Federal funds purchased, securities sold
under agreements to repurchase,
and other short-term borrowings 93,652 128,403
Advanced from Federal Home Loan Bank 268,156 226,812
Guaranteed junior subordinated deferrable
interest debentures * 34,500 35,567
Total interest bearing liabilities 966,419 942,519
Non-interest bearing liabilities:
Demand deposits 107,847 106,344
Other liabilities 5,192 6,379
Stockholders' equity 79,738 75,141
Total liabilities and stockholders' equity $1,159,196 $1,130,383
* - The first quarter 2004 reflects the adoption of FIN46R and the
deconsolidation of the capital trust subsidiary.
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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