Five Star Bancorp (NASDAQ:FSBC)
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1st State Bancorp, Inc. Announces Increased Earnings
BURLINGTON, N.C., Oct. 27 /PRNewswire-FirstCall/ -- 1st State Bancorp, Inc. ,
the parent holding company for 1st State Bank, has reported earnings for the
quarter and year ended September 30, 2003.
Net income for the year ended September 30, 2003 increased 3.1% to $3,920,000,
from net income of $3,802,000 earned in the year ended September 30, 2002.
Basic and diluted earnings per share increased to $1.39 and $1.33 per share,
respectively, for the current year, from $1.25 and $1.21 per share,
respectively, for the prior year. The increase in the basic and diluted
earnings per share was favorably impacted by the Company's stock repurchase plan
which was approved in August 2002. Since that date, 317,630 shares have been
repurchased which represent 9.7% of shares issued.
The improvement in earnings for the year ended September 30, 2003 was
attributable to increased non-interest income which was offset partially by
decreased net interest income. Strong refinancing activity fueled by low
interest rates produced record volumes of mortgage loan originations and sales
during the current year. These loan sales substantially boosted the Company's
mortgage banking income to $1.9 million for the year ended September 30, 2003,
an increase of $800,000 over the $1.1 million reported in the prior year. The
Company's net interest income for the year ended September 30, 2003 was $11.6
million, a decrease of $700,000 from the $12.3 million reported in the prior
year. Earnings continue to be negatively impacted by the historically low
interest rates, which have compressed the Company's net interest margin. The
Company's net interest margin has decreased 21 basis points to 3.54% for the
current year from 3.75% in the prior year.
Net income for the quarter ended September 30, 2003 was $952,000 or basic and
diluted earnings per share of $0.34 and $0.32, respectively. These results
compare with net income of $1,047,000 or basic and diluted earnings per share of
$0.34 and $0.33, respectively, for the prior year's quarter. Basic and diluted
earnings per share were favorably impacted by the Company's stock repurchase
plan, which was approved in August 2002. The $95,000 decrease in net income
resulted primarily from decreased net interest income and increased operating
expenses, which were partially offset by increased non-interest income. For the
quarter ended September 30, 2003, the Company's net interest margin was 3.40%, a
decrease of 60 basis points from the 4.00% for the prior year's quarter. This
decrease reflects the impact of a declining interest rate environment in which
interest-earning assets reprice faster than liabilities due to the asset
sensitive nature of the Company's balance sheet. The increase in non-interest
income resulted primarily from increased mortgage banking income and increased
loan originations and sales. Operating expenses increased 5.4% over the prior
year.
At September 30, 2003, 1st State Bancorp, Inc. had total assets of $363 million,
deposits of $263 million and stockholders' equity of $62.7 million. The book
value per share of common stock was $21.10 per share at September 30, 2003.
1st State Bancorp, Inc., through its subsidiary 1st State Bank, currently
services its customers from seven full service banking offices in Alamance
County.
This press release contains statements that are forward-looking, as that term is
defined by the Private Securities Litigation Act of 1995 or the Securities and
Exchange Commission in its rules, regulations, and releases. The Company intends
that such forward-looking statements are based on current expectations regarding
important risk factors including, but not limited to, the impact of interest
rates on financing issues. Accordingly, actual results may differ from those
expressed in the forward-looking statements, and the making of such statements
should not be regarded as a representation by the Company or any other person
that results expressed therein will be achieved.
1st State Bancorp, Inc. (NASDAQ:FSBC)
Summary of Financial Highlights
Selected Financial Data: Sep 30, Sep 30,
(in thousands - unaudited) 2003 2002
Total assets $362,640 $350,469
Loans receivable, net 225,725 220,047
Loans held for sale 645 6,798
Investment securities 111,171 89,686
Cash and cash equivalents 9,359 18,865
Deposit accounts 262,712 260,667
Advances from Federal Home Loan Bank 31,500 20,000
Dividend payable 297 241
Total stockholders' equity 62,701 61,569
Selected Operating Data: Three months ended Year ended
9/30/2003 9/30/2002 9/30/2003 9/30/2002
(in thousands - unaudited)
Interest income $4,122 4,987 17,209 20,062
Interest expense 1,267 1,682 5,592 7,773
Net interest income 2,855 3,305 11,617 12,289
Provision for loan losses 60 60 240 240
Net interest income after
provision for loan losses 2,795 3,245 11,377 12,049
Non-interest income 958 534 3,588 2,753
Non-interest expense 2,276 2,160 8,802 8,846
Income before taxes 1,477 1,619 6,163 5,956
Income tax expense 525 572 2,243 2,154
Net income 952 1,047 3,920 3,802
Per Share Data: Three months ended Year ended
(unaudited) 09/30/2003 09/30/2002 09/30/2003 09/30/2002
Basic earnings per share $0.34 $0.34 $1.39 $1.25
Diluted earnings per share 0.32 0.33 1.33 1.21
Average shares outstanding -
basic 2,808,409 3,051,947 2,811,200 3,034,415
Average shares outstanding -
diluted 2,944,793 3,150,118 2,938,598 3,154,198
Cash dividends per share $0.10 $0.08 $0.38 $0.32
Book value at September 30 $21.10 $20.46
Shares outstanding at
September 30 2,971,977 3,008,682
Interest Margin Three months ended Year ended
09/30/2003 9/30/2002 9/30/2003 9/30/2002
(% of average assets - unaudited)
Yield on interest earning assets 4.90% 6.04% 5.25% 6.12%
Cost of interest bearing liabilities 1.87% 2.53% 2.11% 2.92%
Interest rate spread 3.03% 3.51% 3.14% 3.20%
Net interest income as a percentage
of average
interest earning assets 3.40% 4.00% 3.54% 3.75%
Asset Quality Sep 30, Sep 30,
(unaudited) 2003 2002
Allowance for loan losses to gross
loans held for investment 1.68% 1.67%
Nonperforming assets to total assets 1.17% 1.25%
DATASOURCE: 1st State Bancorp, Inc.
CONTACT: James C. McGill of 1st State Bancorp, Inc., +1-336-227-8861