MONTEREY, Calif., July 22, 2010 (GLOBE NEWSWIRE) -- 1st Capital Bank (OTCBB:FISB) today announced its fourth consecutive quarter of profitable operations. In addition, the Bank continued to grow in asset size and expand its market share in Monterey County.
"The three months ended June 30, 2010 represent the fourth consecutive quarter of profitable operations for 1st Capital Bank," said Fred Rowden, President and CEO of 1st Capital Bank. He continued; "The Bank has worked diligently to build a healthy loan portfolio funded by deposits from local customers. With its growing asset size, strong capital levels and increasing profitability, 1st Capital Bank is excited to be an integral part of this community's healthy future."
Net income recorded for the quarter ended June 30, 2010 increased $187,000 (1169%) to $203,000, compared to $16,000 for the trailing quarter ended March 31, 2010. Net income per basic and fully diluted share for the quarter ended June 30, 2010 was $0.06 compared to $0.01 for the trailing quarter ended March 31, 2010. The increase in net income for the second quarter of 2010 was due primarily to a decrease in the provision for loan losses and noninterest expenses. Net income of $219,000 for the six months ended June 30, 2010 increased $1,050,000 (126%) compared to a net loss of $831,000 for the six months ended June 30 2009, as a result of an increase in net interest income and a decrease in the provision for loan losses, partially offset by an increase in noninterest expenses. Net income per basic and fully diluted share for the six months ended June 30, 2010 was $0.07 compared to a net loss of ($0.26) for the six months ended June 30, 2009.
Total assets as of June 30, 2010 were $204,046,000, an increase of $11,748,000 (6%) from December 31, 2009 and an increase of $44,353,000 (28%) from $159,693,000 as of June 30, 2009. The growth in loans was the greatest contributor to the overall asset growth. Loans, net of the allowance for loan losses, totaled $147,554,000 at June 30, 2010, an increase of $14,823,000 (11%) from December 31, 2009 and $22,969,000 (18%) from $124,585,000 as of June 30, 2009. The growth in loans was funded by an increase in deposits of $11,165,000 (7%) to $175,397,000 at June 30, 2010 from December 31, 2009 and $43,350,000 (33%) from $132,047,000 as of June 30, 2009. The remaining increase in loans was funded by a decrease in Federal funds sold, of $5,060,000 (14%) to $30,690,000 at June 30, 2010 from $35,750,000 as of December 31, 2009. The available balance of Federal funds sold is also anticipated to be used for future loan growth.
Financial Summary:
Net interest income after the provision for loan losses for the quarter ended June 30, 2010 was $1,712,000, an increase of $158,000 (10%) compared to the trailing quarter ended March 31, 2010 and an increase of $1,297,000 (66%) compared to the six months ended June 30, 2009.
Interest income for the quarter and six months ended June 30, 2010 was $2,219,000 and $4,217,000, respectively, an increase of $221,000 (11%) from the trailing quarter ended March 31, 2010 and an increase of $935,000 (28%) from the six months ended June 30, 2009. Average earning assets for the quarter and six months ended June 30, 2010 were $194,775,000 and $188,946,000, respectively, compared to $183,052,000 for the trailing quarter ended March 31, 2010 and $145,559,000 for the six months ended June 30, 2009, an increase of $11,723,000 (6%) and $43,387,000 (30%), respectively.
Interest expense for the quarter and six months ended June 30, 2010 was $343,000 and $694,000, respectively, a decrease of $8,000 (2%) over the trailing quarter ended March 31, 2009 and a decrease of $279,000 (29%) over the six months ended June 30, 2009. Average interest bearing liabilities for the quarter and six months ended June 30, 2010 were $125,768,000 and $122,071,000, an increase of $7,435,000 (6%) compared to $118,333,000 for the trailing quarter ended March 31, 2010, and an increase of $26,508,000 (28%) compared to $95,564,000 for the six months ended June 30, 2009.
The net interest margin for the quarter ended June 30, 2010 was 3.9% compared to 3.6% for the trailing quarter ended March 31, 2010 and 3.2% for the six months ended June 30, 2009.
1st Capital Bank provided $164,000 for loan losses for the quarter ended June 30, 2010 compared to $93,000 for the trailing quarter ended March 31, 2010 and $257,000 and $340,000 for the six months ended June 30, 2010 and 2009, respectively. The ratio of the allowance for loan losses to total loans outstanding was 1.56% at June 30, 2010, a slight increase from 1.54% at December 31, 2009. The Bank continues to monitor and evaluate its loan portfolio and assess the sufficiency of its reserves on an ongoing basis. At June 30, 2010 and December 31, 2009 there were no non-accrual or restructured loans and the Bank did not have any other real estate owned.
Noninterest income increased $9,000 (39%) to $32,000 for the quarter ended June 30, 2010 as compared to the trailing quarter ended March 31, 2010 and increased $1,000 (2%) for the six months ended June 30, 2010 compared to 2009, largely due to seasonal fluctuations in the balances of deposit accounts which generate service charges.
Noninterest expenses decreased by $20,000 (1%) to $1,540,000 for the quarter ended June 30, 2010 as compared to the trailing quarter ended March 31, 2010. The majority of this decrease was due to a reduction in the amortization cost of stock-based compensation, partially offset by an increase in marketing expense. Noninterest expense increased $247,000 (9%) for the six months ended June 30, 2010 compared to 2009. The majority of this increase was due to an increase in salary and benefit and marketing expenses as the Bank grew in size and launched new advertising campaigns, partially offset by decreases in amortization expense for stock-based compensation as the Bank completed amortization of its pre-opening grant issuances. Stock-based compensation costs included in the salaries and benefits and other expense components of noninterest expense for the quarter ended June 30, 2010 totaled $47,000 a decrease from the $122,000 in expense recorded in the trailing quarter ended March 31, 2010. Stock-based compensation expense for the six months ended June 30, 2010 and 2009 was $169,000 and $266,000 respectively.
1st Capital Bank currently operates three branch offices in Monterey County, which are located in the historic Estrada Adobe at 470 Tyler Street, Monterey; at 1097 South Main Street, Salinas; and at 432 Broadway Street, King City. The experienced bankers at 1st Capital Bank provide traditional deposit, lending, mortgage and commercial products and services to business and retail customers throughout the California Central Coast and Salinas Valley areas of Monterey County.
Information regarding the Bank may be obtained from the Bank's website at www.1stCapitalBank.com. Copies of the Bank's press releases are available on the website.
Forward Looking Statements
In addition to the historical information contained herein, this press release may contain certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. The reader of this press release should understand that all such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that might cause such a difference include, among other matters, changes in interest rates; economic conditions including inflation and real estate values in California and the Bank's market areas; governmental regulation and legislation; credit quality; competition affecting the Bank's businesses generally; the risk of natural disasters and future catastrophic events including terrorist related incidents and other factors beyond the Bank's control; and factors discussed in the Bank's periodic reports under the Securities Exchange Act of 1934, as amended, on Forms 10-K, 10-Q and 8-K filed with the FDIC. The Bank does not undertake any obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or otherwise, except as required by law.