MCKENNEY, Va., Oct. 11 /PRNewswire-FirstCall/ -- Bank of McKenney
(Nasdaq: BOMK) today announced third quarter earnings of $326,000, an increase
of 3.82% over 2004 third quarter earnings of $314,000. Basic and diluted
earnings per share of $0.17 were reported for the three months ended September
30, 2005 on 1,926,656 weighted average shares outstanding. This compares to
prior year third quarter earnings per basic and diluted share of $0.16 on an
equal number of weighted average shares outstanding. For the nine-month
period ended September 30, 2005, the Bank reported earnings of $965,000, an
increase of 6.63% when compared to $905,000 through the first nine months of
2004. For the first three quarters of 2005 and 2004, earnings per basic and
diluted share of $0.50 and $0.47, respectively, were recorded. Annualized
returns on average assets and average equity for the first nine months of 2005
were 0.94% and 8.17%, respectively, compared to 0.94% and 8.05%, respectively,
for the same period in 2004.
As of September 30, 2005, total assets amounted to $144.2 million, an
8.99% or $11.9 million increase over the December 31, 2004 level of $132.3
million. Total deposits amounted to $112.7 million as of September 30, 2005,
which represents a 1.44% increase over the $111.1 million level as of December
31, 2004. Total borrowings from the Federal Home Loan Bank increased $9.7
million from $4.7 million on December 31, 2004 to $14.4 million as of
September 30, 2005. The Bank expanded its borrowings during a period of very
attractive longer-term rates earlier in the year as part of a strategic
lending and investing plan designed to capitalize on the flattening yield
curve. Total loans grew to $97.4 million as of September 30, 2005, compared
to $93.7 million as of December 31, 2004. The loan portfolio was up 3.95%
over the prior year-end level. On September 30, 2005, the investment
portfolio stood at $21.5 million, a 1.42% increase over the $21.2 million
December 31, 2004 balance. Overnight federal funds sold increased $4.0
million from $2.5 million on December 31, 2004 to $6.5 million on September
30, 2005. Also during the third quarter, the Bank invested $3.0 million in
three and six month time deposit products with sound financial institutions as
a short-term yield-enhancing alternative to overnight funds. Cumulatively,
these earning assets grew $11.0 million or 9.37% during the nine months of
2005 and represent 89.04% of total assets.
Net interest income increased 5.86% to $1,409,000 in the third quarter of
2005 from $1,331,000 in the comparable period in 2004. Noninterest income,
exclusive of securities transactions, increased 9.87% from $375,000 in the
third quarter of 2004 to $412,000 for the same period in 2005. Service
charges declined 2.09% during the period to $187,000 when compared to the
September 30, 2004 level of $191,000. The secondary market mortgage
department continued to experience growth in revenue during the third quarter
boosting other noninterest income by $33,000 or 18.33% to $213,000.
Noninterest expense increased 10.31% to $1,338,000 during the third quarter
2005 from $1,213,000 for the same period in 2004, due primarily to additional
expenses associated with the Bank's growth. For the first nine months of
2005, net interest income increased to $4,182,000 from $3,948,000 in the
comparable period in 2004, an increase of $234,000 or 5.93%. Service charges
declined 0.74% during the same period to $534,000 when compared to the
September 30, 2004 level of $538,000. For the same nine month period, other
noninterest income grew by $64,000 or 13.14% from $487,000 in 2004 to $551,000
in 2005. Noninterest expense increased 6.63% to $3,843,000 during the first
three quarters of 2005 from $3,604,000 for the same period in 2004. The net
interest margin stood at a level of 4.60% at the 2005 third quarter close, a 7
basis point decline from the same period in 2004. The slight decrease is
reflective of the initial impact of increased borrowing levels at the Federal
Home Loan Bank. However, the margin remains above-peer and is attributable to
investment and lending strategies geared toward less exposure during a rising
rate environment.
Richard M. Liles, President and Chief Executive Officer, stated, "Next
year marks the Bank's 100th anniversary, and we are extremely excited about
this tribute to solid management practices and stability. A century of
experience has helped guide us in past decisions that continue to yield
rewarding results. We are currently evaluating additional growth strategies
aimed at both expanding our market area and further increasing market share."
Bank of McKenney is a full-service community bank headquartered in
McKenney, Virginia with six branches serving Southeastern Virginia and assets
totaling $144 million.
Certain statements in this document are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act. These
statements are based on management's current expectations and are subject to
uncertainty and changes in circumstances. Actual results may differ
materially from those included in these statements due to a variety of
factors. More information about these factors is contained in Bank of
McKenney's filings with the Board of Governors of the Federal Reserve.
BANK OF MCKENNEY AND SUBSIDIARY
Consolidated Balance Sheets Summary Data
September 30, 2005 (unaudited) and December 31, 2004
September 30, December 31,
ASSETS 2005 2004
Cash and due from banks $8,332,925 $4,717,886
Federal funds sold 6,496,000 2,526,000
Securities available for sale, at fair
market value 20,261,336 20,433,458
Restricted investments 1,265,255 806,825
Loans, net 96,326,326 92,708,341
Land, premises and equipment, net 6,524,837 6,558,878
Other assets 4,998,715 4,519,704
Total Assets $144,205,394 $132,271,092
LIABILITIES
Deposits $112,651,906 $111,069,704
Borrowed Funds 14,435,000 4,702,077
Other liabilities 1,072,782 1,135,364
Total Liabilities $128,159,688 $116,907,145
SHAREHOLDERS' EQUITY
Total shareholders' equity $16,045,706 $15,363,947
Total Liabilities and
Shareholders' Equity $144,205,394 $132,271,092
BANK OF MCKENNEY AND SUBSIDIARY
Consolidated Statements of Income Summary Data
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
Interest and dividend
income $2,047,017 $1,769,094 $5,803,501 $5,242,363
Interest expense 638,017 438,223 1,621,310 1,294,537
Net interest income $1,409,000 $1,330,871 $4,182,191 $3,947,826
Provision for loan losses 10,000 27,222 25,000 99,222
Net interest income after
provision for loan losses $1,399,000 $1,303,649 $4,157,191 $3,848,604
Net noninterest expense 926,262 839,358 2,744,337 2,513,737
Net income before taxes $472,738 $464,291 $1,412,854 $1,334,867
Income taxes 146,942 150,114 447,994 429,480
Net income $325,796 $314,177 $964,860 $905,387
Basic & diluted earnings
per share $0.17 $0.16 $0.50 $0.47
Weighted average shares
outstanding 1,926,656 1,926,656 1,926,656 1,926,656
SOURCE Bank of McKenney
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Related links:
http://www.bankofmckenney.com
CONTACT:
J. Bryant Neville, Jr., Executive Vice
President and Chief Financial Officer of Bank of McKenney,
+1-804-478-4434, or bryant.neville@bankofmckenney.com
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