Highlights for the First Fiscal Quarter 2006:
- EPS Growth: up 19.2% compared to the same quarter a year ago with Net
Income up 19.3% compared to the same quarter a year ago
- Net Loans Receivable Growth: up 23.6% compared to the same quarter a
year ago
- Deposit Growth: up 17.7% compared to the same quarter a year ago
- Net Interest Margin: 4.47% vs. 4.43% a year ago
- Improved Return on Average Tangible Equity: 13.7% vs. 12.8% a year ago
CLARKSTON, Wash., Aug. 12 /PRNewswire-FirstCall/ -- FirstBank NW Corp.
(the Company) (Nasdaq: FBNW) today announced another quarter of strong
financial results driven by the ongoing economic strength in its market areas.
For the quarter ended June 30, 2005, diluted earnings per share increased
19.2% to $0.62 compared to $0.52 for the same quarter a year ago. Net income
for the quarter was up 19.3% to $1.9 million compared to $1.6 million for the
same quarter a year ago. At June 30, 2005, net loans receivable was 23.6%
higher than a year ago, and grew at a 29% linked-quarter pace (annualized)
during the first fiscal quarter. Similarly, deposit balances as of June 30,
2005 were 17.7% higher than the quarter ended June 30, 2004 and increased at a
33% linked-quarter pace (annualized).
For the first fiscal quarter of 2006 the Company's return on average
tangible equity was 13.7% compared to 12.8% for the quarter ended June 30,
2004, while the return on average assets for the current quarter and the
comparable quarter in 2004 remained relatively unchanged at 0.9%. The net
interest margin was higher for the quarter ended June 30, 2005, at 4.47%
compared to 4.43% in the quarter ended June 30, 2004.
"While we continue to realize excellent loan demand throughout our market
area, the loan growth during the quarter was primarily driven by construction
lending in the Boise, Idaho market, and commercial real estate in the Boise
and Coeur d'Alene, Idaho and Spokane, Washington markets," said Clyde E.
Conklin, President and Chief Executive Officer.
LOAN GROWTH AND CREDIT QUALITY:
At June 30, 2005, net loans receivable grew to $603.0 million, up $115.1
million from $487.9 million a year ago. Loan growth on a linked-quarter basis
was $40.9 million, a 29% (annualized) pace. Loan growth was well distributed
by region and by loan type, as commercial, construction, and commercial real
estate lending were strong.
The credit quality of the Company's loan portfolio remained good with
total non-performing assets of $2.4 million, or 0.28% of total assets at June
30, 2005 compared to $2.5 million, or 0.35% of total assets at June 30, 2004,
and $2.8 million, or 0.35% of total assets at March 31, 2005. Net loan
charge-offs for the first fiscal quarter were $151,000 compared to the quarter
a year ago of $269,000, and $151,000 for the quarter ended March 31, 2005.
The reserve for losses on loans and loan commitments at June 30, 2005
remained unchanged at 1.32% of net loans at June 30, 2004, and essentially
unchanged from 1.29% at March 31, 2005. In keeping with the quarter's strong
loan growth, loan loss provision expense was $868,000 for the quarter ended
June 30, 2005, up from $376,000 for the quarter ended June 30, 2004, and
$488,000 for the quarter ended March 31, 2005. The increase in the loan loss
provision expense reflects the increase in the Company's loan portfolio during
the quarter. Management believes the reserve is at an appropriate level
considering the credit quality demonstrated, loan loss histories, and
prevailing economic conditions.
FUNDING:
At June 30, 2005, total branch deposits were $502.3 million, consisting of
$311.5 million, or 62.0% in core deposits and $190.8 million, or 38.0% in time
deposits compared with the comparable period a year ago of $453.4 million in
total branch deposits, which consisted of $279.6 million, or 61.7% in core
deposits and $173.8 million, or 38.3% in time deposits. Brokered deposits at
June 30, 2005 totaled $59.4 million as compared to $23.8 million a year ago,
an increase of $35.6 million. Federal Home Loan Bank (FHLB) and other
borrowings at June 30, 2005 totaled $193.8 million as compared to $168.2
million a year ago, an increase of $25.6 million. "Branch deposit growth with
an emphasis on core deposit growth remains essential to long term funding and
earnings," noted Conklin.
NET INTEREST MARGIN AND INTEREST RATE RISK:
The Company's net interest margin was 4.47% for the first fiscal quarter
of 2006 compared to 4.43% for the quarter ended June 30, 2004. The flattening
of the yield curve continues to pressure the net interest margin, however, the
Company's asset sensitivity continues to accommodate timely market pricing as
the cost of deposits and borrowed funds continues to increase. Yields on
earning assets increased by 27 basis points during the current quarter to
6.82% compared to 6.31% for the quarter ended June 30, 2004. Meanwhile, the
average rates paid on interest-bearing liabilities increased 19 basis points
during the current quarter to 2.33% compared to1.90% for the quarter ended
June 30, 2004. The yield curve continues to fluctuate with the economy with
the net interest margin remaining under pressure. Attainment of branch
deposit growth objectives as opposed to continued reliance on high cost of
FHLB borrowings is essential to maintenance of the net interest margin.
NON INTEREST INCOME AND EXPENSE:
Non-interest income for the quarters ended June 30, 2005 and 2004 remained
unchanged at $1.7 million. Non-interest income is driven by gain on sales of
loans and transaction account fees.
Non-interest expense for the quarter ended June 30, 2005 was $6.0 million,
or 4.6% above the quarter ended June 30, 2004 of $5.7 million. Non-interest
expenses are expected to increase as the Company invests in new branches and
complies with increased regulatory and audit requirements.
CAPITAL:
At June 30, 2005, Tier 1 capital (leverage ratio based on average assets)
was $53.2 million, or 6.6%, and total risk capital (to risk-weighted assets)
was $63.7 million, or 10.6%. Risk capital for the current quarter was enhanced
by issuance of $3.0 million in subordinated debt by the Company's subsidiary,
FirstBank Northwest, to US Bank.
BUSINESS STRATEGY:
FirstBank NW Corp. (headquartered in Clarkston, Washington) is the holding
company for FirstBank Northwest, a Washington state chartered savings bank
founded in 1920, and has a track record of consistent above-average growth and
improving profitability, operating in the rural markets of eastern Oregon,
eastern Washington and central Idaho, in addition to the larger and growing
markets of Boise and Coeur d'Alene, Idaho and Spokane, Washington. FirstBank
Northwest is focused on each community served, striving to deliver competitive
financial products and services through exceptional customer service
standards, local expertise and leadership. FirstBank Northwest operates 20
branch locations in Idaho, eastern Washington and eastern Oregon, in addition
to residential loan centers in Lewiston, Coeur d'Alene, Boise and Nampa,
Idaho, Spokane, Washington, and Baker City, Oregon. FirstBank Northwest is
known as the local community bank, offering its customers highly personalized
service in the many communities it serves.
FORWARD LOOKING STATEMENTS:
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 the Company operates,
projections of future performance, including operating efficiencies, perceived
opportunities in the market, potential future credit experience and statements
regarding the Company's mission and vision. These forward-looking statements
are based upon current management expectations, and may, therefore, involve
risks and uncertainties. The Company'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 factors 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,
competitive conditions between banks and non-bank financial service providers,
regulatory changes, costs of implementing additional securities requirements
and requirements of the Sarbanes Oxley Act of 2002 and other risks detailed
in the Company's reports filed with the Securities and Exchange Commission,
including its Annual Report on Form 10-K for the fiscal year ended March 31,
2005.
FIRSTBANK NW CORP
FINANCIAL HIGHLIGHTS
(unaudited) (dollars in thousands except share and per share data)
Three Months Ended Three Months Ended
June 30, June 30,
2005 2004
Interest Income $12,140 $9,510
Interest Expense 4,328 2,982
Provision for Loan Losses 868 376
Net Interest Income After Provision
for Loan Losses 6,944 6,152
Non-Interest Income
Gain on Sale of Loans (1) 338 504
Service Fees and Charges 1,217 1,181
Commission and Other 102 33
Total Non-Interest Income 1,657 1,718
Non-Interest Expenses
Compensation and Related Expenses 3,639 3,418
Occupancy 706 744
Other 1,605 1,528
Total Non-Interest Expense 5,950 5,690
Income Tax Expense 799 628
Net Income $1,852 $1,552
Basic Earnings per Share $0.63 $0.54
Diluted Earnings per Share $0.62 $0.52
Weighted Average Shares Outstanding-
Basic 2,928,855 2,866,090
Weighted Average Shares Outstanding-
Diluted 2,990,800 2,996,698
Actual Shares Issued 2,998,695 2,965,268
FINANCIAL STATISTICS
(ratios annualized)
June 30, 2005 June 30, 2004
Total Assets $843,961 $732,662
Cash and Cash Equivalents $43,994 $37,007
Loans Receivable, net $602,997 $487,861
Loans Held for Sale $8,383 $5,285
Mortgage-Backed Securities $59,401 $71,180
Investment Securities $48,325 $49,326
Equity Securities, at cost $12,789 $12,628
Deposits $561,655 $477,233
FHLB Advances and Other Borrowings $193,823 $168,197
Stockholders' Equity $73,960 $69,671
Tangible Book Value per Share (2) $18.61 $16.92
Tangible Equity/ Total Tangible
Assets 6.61% 6.86%
Number of Full-time Equivalent
Employees (3) 262 257
Three Months Ended Three Months Ended
June 30, June 30,
2005 2004
Return on Average Assets 0.90% 0.88%
Return on Average Tangible Equity 13.67% 12.76%
Return on Average Equity 10.05% 8.92%
Average Equity/Average Assets 8.94% 9.88%
Efficiency Ratio (4) 60.10% 65.16%
Non-Interest Expenses / Average
Assets 2.89% 3.23%
Net Interest Margin (5) 4.47% 4.43%
LOANS June 30, 2005 June 30, 2004
(unaudited) (dollars in thousands except share and per share data)
LOAN PORTFOLIO ANALYSIS: Amount Percent Amount Percent
Real Estate Loans:
Residential $117,565 19.16 % $117,436 23.68 %
Construction 86,023 14.02 47,594 9.59
Agricultural 20,204 3.29 19,648 3.96
Commercial 191,347 31.18 126,590 25.52
Total Real Estate Loans 415,139 67.65 311,268 62.75
Consumer and Other Loans:
Home Equity 40,265 6.56 31,430 6.34
Agricultural Operating 26,739 4.36 29,079 5.86
Commercial 90,860 14.81 81,551 16.44
Other Consumer 40,634 6.62 42,693 8.61
Total Consumer and Other
Loans 198,498 32.35 184,753 37.25
Total Loans Receivable $613,637 100.00 % $496,021 100.00 %
ALLOWANCE FOR LOAN LOSSES Three Months Ended Three Months Ended
June 30, 2005 June 30, 2004
Balance at Beginning of Period $7,254 $6,314
Provision for Loan Losses 868 376
Charge Offs (Net of Recoveries) (151) (269)
Balance at End of Period $7,971 $6,421
Loan Loss Allowance / Net Loans 1.32% 1.32%
Loan Loss Allowance / Non-Performing
Loans 825.16% 554.01%
NON-PERFORMING ASSETS June 30, 2005 June 30, 2004
Accruing Loans - 90 Days Past Due $272 $0
Non-accrual Loans 694 1,159
Total Non-performing Loans 966 1,159
Restructured Loans on Accrual 1,345 827
Real Estate Owned (REO) 0 525
Repossessed Assets 93 28
Total Non-performing Assets $2,404 $2,539
Total Non-performing Assets/Total
Assets 0.28% 0.35%
Loan and REO Loss Allowance as a
Percentage of Non-
Performing Assets 331.57% 252.89%
AVERAGE BALANCES AND AVERAGE
YIELDS/COSTS Three Months Ended Three Months Ended
June 30, June 30,
2005 2004
Total Average Interest-Earning
Assets $737,425 $634,028
Total Average Assets 824,707 704,761
Average Deposits and Other Borrowed
Funds 743,171 627,699
Average Total Tangible Equity 54,178 48,643
(1) Gain on sale of loans includes recovery of mortgage servicing rights
of $19 at June 30, 2005 and $134 at June 30, 2004.
(2) Calculation excludes unallocated shares in the employee stock
ownership plan (ESOP) June 30, 2005 -- 68,704 and June 30,
2004 -- 77,060 shares.
(3) Number of full-time equivalent employees is the quarterly average.
(4) Calculation is non-interest expense divided by tax equivalent
non-interest income and tax equivalent net interest income.
(5) Calculation is tax equivalent net interest income divided by total
interest-earning assets.
SOURCE FirstBank NW Corp.
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Related links:
http://www.fbnw.com
CONTACT:
Larry K. Moxley of FirstBank, +1-509-295-5100
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