Coast Financial (NASDAQ:CFHI)
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Coast Financial Holdings Reports Record First Quarter Results
Relocates Headquarters to Downtown Bradenton
BRADENTON, Fla., April 22 /PRNewswire-FirstCall/ -- Coast Financial Holdings,
Inc. (NASDAQ:CFHI), parent company of Coast Bank of Florida, today reported
that strong loan and deposit growth contributed to a 29% increase in net
interest income for the first quarter ended March 31, 2005, compared to the
first quarter of 2004. Coast reported net income of $77,000, or $0.02 per
diluted share in the first quarter of 2005, compared to $9,000, or $0.00 per
diluted share in the first quarter of 2004.
"We have generated both top and bottom line improvements, with revenues
increasing 21%, loans expanding 37% and net income improving eight-fold from
year ago levels," said Brian Peters, President and Chief Executive Officer. "We
continue to focus on growing our franchise in key markets. During the first
quarter we began the process of opening branches in Pinellas County, with two
new branches in the St. Petersburg area. In addition, we announced plans to
add 36 new stand alone kiosk ATM locations in Pinellas, Manatee and Sarasota
Counties. Recently, we opened our third branch in Pinellas County in Kenneth
City and moved our corporate offices to downtown Bradenton. We anticipate
opening our fourth Pinellas County branch in Seminole by the end of May. These
investments will increase costs in 2005 but we are confident they will
contribute to future earnings."
Income Statement Review
Revenues (net interest income before the provision for loan losses plus other
operating income) for the quarter ended March 31, 2005 increased 21% to $3.5
million, compared to $2.9 million for the first quarter of 2004. For the
quarter, net interest income, a basic measure of bank profitability, grew 29%
to $3.0 million, compared to $2.3 million in the like quarter of 2004. Net
interest margin was 3.23% for the 2005 first quarter, compared to net interest
margin of 3.24% for the fourth quarter of 2004, and net interest margin of
3.60% for the first quarter of 2004. "We experienced a compression in out net
interest margin compared to the first quarter of 2004 as a result of exiting
our high risk, high yielding car loan portfolio early last year. We are
confident that with better management of our cost of funds we will be able to
expand our margin going forward," said Peters.
Non-interest income for the first quarter was $527,000, compared to $588,000
for the first quarter of 2004 and $642,000 for the fourth quarter of 2004.
Non-interest expense increased by 18% to $3.0 million, compared to $2.5 million
in the first quarter a year ago, due to the increased staffing and occupancy
expenses associated with the Bank's expansion.
"We have recently relocated our corporate offices to Coast Financial Center, a
six-story building we purchased last year. This new building gives us a very
visible presence in downtown Bradenton, and we will be able to consolidate all
of our administrative and corporate operations to one facility, from the two
widely separated offices currently in use. The consolidation should also
provide us with operational efficiencies going forward," said Peters. "We
opened a branch office on the ground floor of Coast Financial Center in May of
last year, and it is ahead of plan regarding attracting new deposits."
The Coast Financial Center building is located at 1301 6th Avenue West in
Bradenton. It will house all operational departments as well as a Coast branch
on the main level and a two-lane stand-alone drive-thru.
The company still owns the Operations Center on Cortez Road, of which Coast
Residential Division occupies half. The company has leased the other half of
the building to a tenant who has the option to purchase the building, at which
time the bank would then lease back half of the building to keep the
Residential Lending division in place. The Cortez Road building was originally
purchased in November 2002.
Balance Sheet Review
Assets increased 39% to a record $424 million at March 31, 2005, compared to
$304 million a year earlier. Book value increased to $9.27 per share at March
31, 2005, from $9.06 per share a year earlier.
Coast Financial increased its net loans 37%, to $323 million at March 31, 2005,
from $235 million a year ago. "Over the past 12-months, we have expanded our
loan portfolio and anticipate that because of the high growth throughout the
Tampa Bay market, we should be able to continue at that rate this year," said
Peters. "The economy across the Tampa Bay market remains strong. This loan
demand has been funded by deposit growth at both our new and existing
branches."
Commercial real estate loans grew 74% and now comprise 34% of Coast's net loan
portfolio at March 31, 2005, compared to 27% a year earlier. Residential
construction and land loans grew 50% and now account for 49% of net loans,
compared to 45% at March 31, 2004.
Non-performing assets totaled $1.4 million, or 0.34% of total assets, compared
to $1.5 million, or 0.38% of total assets at December 31, 2004, and $1.9
million, or 0.61% of total assets at March 31, 2004. The allowance for loan
losses was $3.0 million, or 0.94% of total loans outstanding, at March 31,
2005, compared to $3.2 million, or 1.35% of total loans outstanding, a year
earlier. "The decrease in allowance for loan losses was due to the write off
of certain loans in 2004 that had been provided for at the end of 2003" said
Peters. Consequently, the ratio of net charge-offs to average loans
outstanding improved 21 basis points to 0.29% at March 31, 2005, compared to
0.50% a year ago.
Core deposits, comprised of checking, savings and money market accounts,
increased 46% to $125 million compared to $85 million a year ago. Certificate
of deposits accounts have increased 36% to $221 million from $163 million at
March 31, 2004. "Through our branch expansion, we are focusing on building
core deposits, which provide lower cost funds needed for profitable loan
growth," Peters added. "We are also introducing relationship checking products
to expand our cross sell activities designed to garner new core deposits."
About the Company
As of March 31, 2005, Coast Financial Holdings, Inc. had $424 million in total
assets and through its banking subsidiary, Coast Bank of Florida
(http://www.coastfl.com/), operates nine full-service banking locations in
Manatee and Pinellas County, Florida. Coast Bank of Florida is a general
commercial bank that provides full-service banking operations to its customers
from its headquarters location and from branch offices in Bradenton, Palmetto,
Longboat Key and St. Petersburg. Through an arrangement with Raymond James
Financial Services, Inc., Coast Bank makes asset and investment management
services and insurance products available to its customers.
This press release and other statements to be made by the Company contain
certain forward-looking statements within the meaning of the Private Securities
Litigation Reform Act, including but not limited to statements relating to
projections and estimates of earnings, revenues, cost-savings, expenses, or
other financial items; statements of management's plans, strategies, and
objectives for future operations, and management's expectations as to future
performance and operations and the time by which objectives will be achieved;
statements concerning proposed new products and services; and statements
regarding future economic, industry, or market conditions or performance.
Forward-looking statements are typically identified by words or phrases such as
"believe," expect," anticipate," project," and conditional verbs such as "may,"
"could," and "would," and other similar expressions or verbs. Such
forward-looking statements reflect management's current expectations, beliefs,
estimates, and projections regarding the Company, its industry and future
events, and are based upon certain assumptions made by management. These
forward-looking statements are not guarantees of future performance and
necessarily are subject to risks, uncertainties, and other factors (many of
which are outside the control of the Company) that could cause actual results
to differ materially from those anticipated. These risks, uncertainties, and
other factors include, among others: changes in general economic or business
conditions, either nationally or in the State of Florida, changes in the
interest rate environment, the Company's ability to successfully open and
operate new branches and collect on delinquent loans, changes in the regulatory
environment, and other risks described in the Company's Form 10-KSB for the
fiscal year ended December 31, 2003 and as described from time to time by the
Company in other reports filed by it with the Securities and Exchange
Commission. Any forward-looking statement speaks only to the date on which the
statement is made, and the Company disclaims any obligation to update any
forward-looking statement, whether as a result of new information, future
events or otherwise. If the Company does update any forward-looking
statements, no inference should be drawn that the Company will make additional
updates with respect to that statement or any other forward-looking statements.
Contacts:
Brian P. Peters, President and CEO Brian F. Grimes, EVP and CFO
941-752-5900 941-752-5900
COAST FINANCIAL HOLDINGS, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Earnings
($ in thousands, except per share amounts)
Quarter Ended
Mar 31, Dec 31, Mar 31,
2005 2004 2004
(Unaudited) (Unaudited)
Interest income:
Loans $4,841 4,555 3,604
Securities 452 354 238
Other interest-earning assets 7 10 12
Total interest income 5,300 4,919 3,854
Interest expense:
Deposits 2,155 2,018 1,471
Borrowings 174 97 85
Total interest expense 2,329 2,115 1,556
Net interest income 2,971 2,804 2,298
Provision for loan losses 360 176 329
Net interest income after
provision for loan losses 2,611 2,628 1,969
Noninterest income:
Service charges on deposit accounts 122 114 96
Gain on sale of loans held for sale 441 428 283
Net loan servicing costs - - (58)
Asset management (costs) fees - (2) 71
Other service charges and fees (costs) (32) 50 190
Other (4) 52 6
Total noninterest income 527 642 588
Noninterest expenses:
Employee compensation and benefits 1,600 1,527 1,330
Occupancy and equipment 407 374 335
Data processing 211 225 248
Professional fees 97 67 176
Telephone, postage and supplies 234 172 138
Advertising 157 102 97
Other 300 273 218
Total noninterest expenses 3,006 2,740 2,542
Earnings before income taxes 132 530 15
Income taxes 55 212 6
Net earnings 77 318 9
Earnings per share, basic and
diluted $0.02 0.08 0.00
Weighted-average number of common
shares outstanding, basic 3,757,597 3,756,050 3,740,032
Weighted-average number of common
shares outstanding, diluted 3,824,974 3,814,676 3,740,032
COAST FINANCIAL HOLDINGS, INC. AND SUBSIDIARY
Condensed Consolidated Balance Sheets
($ in thousands, except per share amounts)
March 31, December 31, March 31,
Assets 2005 2004 2004
(Unaudited) (Unaudited)
Cash and due from banks $9,580 7,122 8,362
Federal funds sold 6,908 - 16,065
Cash and cash equivalents 16,488 7,122 24,427
Securities available for sale 56,683 55,490 27,686
Loans, net of allowance for loan
losses of $3,040, $2,901 and $3,212 323,416 297,725 235,347
Federal Home Loan Bank stock, at cost 1,315 573 854
Premises and equipment, net 20,420 18,358 9,616
Accrued interest receivable 1,616 1,478 1,263
Deferred income taxes 1,909 1,846 2,417
Loan servicing rights - - 1,105
Other assets 1,852 2,031 1,019
Total assets $423,699 384,623 303,734
Liabilities and Stockholders' Equity
Liabilities:
Noninterest-bearing demand deposits 31,802 25,485 25,356
Savings, NOW and money-market deposits 92,992 99,394 60,125
Time deposits 221,468 201,410 162,827
Total deposits 346,262 326,289 248,308
Federal Home Loan Bank advances 16,100 1,000 2,500
Federal funds purchased - 3,790 -
Other borrowings 23,484 15,867 16,148
Other liabilities 3,005 2,729 2,820
Total liabilities 388,851 349,675 269,776
Stockholders' equity:
Preferred stock, $0.01 par value;
5,000,000 shares authorized, - - -
no shares issued and outstanding
Common stock, $5 par value;
20,000,000 shares authorized,
3,757,650, 3,756,050 and
3,747,450 shares issued and
outstanding in 2005, December
2004 and March 2004 18,788 18,780 18,737
Additional paid-in capital 19,456 19,448 19,404
Accumulated deficit (3,147) (3,224) (4,046)
Accumulated other comprehensive
income (loss) (249) (56) (137)
Total stockholders' equity 34,848 34,948 33,958
Total liabilities and
stockholders' equity $423,699 384,623 303,734
ADDITIONAL FINANCIAL INFORMATION
(in thousands)
LOANS: Mar 31, Dec 31, Mar 31,
2005 2004 2004
(unaudited) (unaudited)
Commercial $24,792 $32,020 $30,829
Commercial real estate 111,032 99,955 63,800
Installment 28,887 29,640 36,416
Residential real estate 49,947 47,157 42,184
Residential construction 109,775 89,716 63,624
324,433 298,488 236,853
Add (deduct):
Deferred loan costs, net 2,023 2,138 1,706
Allowance for loan losses (3,040) (2,901) (3,212)
Loans, net $323,416 $297,725 $235,347
Mar 31, Dec 31, Mar 31,
NON - PERFORMING ASSETS : 2005 2004 2004
Loans on Non - Accrual Status $1,378 $1,444 $1,850
Delinquent Loans on Accrual Status -- -- --
Total Non - Performing Loans 1,378 1,444 1,850
Real Estate Owned (REO) / Repossessed
assets 42 33 2
Total Non - Performing Assets $1,420 $1,477 $1,852
Total Non - Performing Assets / Total
Assets 0.34% 0.38% 0.61%
Quarter Ended
CHANGE IN THE Mar 31, Dec 31, Mar 31,
2005 2004 2004
ALLOWANCE FOR LOAN LOSSES :
Balance at beginning of period $2,901 $2,839 $3,163
Provision for loan losses 360 176 329
Recoveries 80 295 12
Charge offs (301) (409) (292)
Net charge offs (221) (114) (280)
Balance at end of period $3,040 $2,901 $3,212
Net Charge-offs / Average Loans
Outstanding 0.29% 0.15% 0.50%
Allowance for Loan Losses / Total
Loans Outstanding 0.93% 0.96% 1.35%
Allowance for Loan Losses / Non -
Performing Loans 221% 201% 174%
COAST FINANCIAL HOLDINGS, INC. AND SUBSIDIARY
Operating Performance
($ in thousands)
March 31, Dec. 31, March 31,
2005 2004 2004
(Unaudited) (Unaudited)
Average loans $314,226 293,154 223,949
Average securities and deposits 58,361 51,347 32,842
Average non - interest - earning
assets 29,510 26,371 21,536
Total Average Assets $402,097 370,872 278,327
Average interest bearing deposits $303,209 287,365 200,086
Average borrowings 32,190 21,724 20,631
Average non - interest bearing
liabilities 31,776 27,185 24,000
Total Average Liabilities 367,175 336,274 244,717
Total average equity 34,922 34,598 33,610
Total Average Liabilities And Equity $402,097 370,872 278,327
Interest rate yield on loans 6.25% 6.18% 6.47%
Interest rate yield on securities and
deposits 3.19% 2.82% 3.06%
Interest Rate Yield On Interest
Earning Assets 5.77% 5.68% 6.04%
Interest rate expense on deposits 2.88% 2.79% 2.96%
Interest rate expense on borrowings 2.19% 1.78% 1.66%
Interest Rate Expense On Interest
Bearing Liabilities 2.82% 2.72% 2.84%
Interest rate spread 2.95% 2.96% 3.20%
Net interest margin 3.23% 3.24% 3.60%
Other operating income/Average assets 0.53% 0.69% 0.85%
Other operating expense/Average
assets 3.03% 2.94% 3.67%
Efficiency ratio (non-interest
expense/revenue) 85.93% 79.51% 88.07%
Return on average assets 0.08% 0.34% 0.01%
Return on average equity 0.89% 3.66% 0.11%
Average equity/Average assets 8.68% 9.33% 12.08%
DATASOURCE: Coast Financial Holdings, Inc.
CONTACT: Brian P. Peters, President, and CEO, +1-941-752-5900,
, or Brian F. Grimes, EVP and CFO,
+1-941-752-5900,
Web site: http://www.coastfl.com/