EX-99.1 3 a03-1713_1ex991.htm EX-99.1

News Release

 

 

Date:  July 16, 2003

Phone Number: 805/473-6803

Contact: James G. Stathos

NASDAQ Symbol: MDST

Title: Executive Vice President and Chief Financial Officer

Web site: www.midstatebank.com

 

 

Mid-State Bancshares Reports Strong Earnings Increase of 16.9%

 

 

ARROYO GRANDE, CA – Mid-State Bancshares (the Company), the holding company for Mid-State Bank & Trust (the Bank), reported net income of $8.4 million for the three months ended June 30, 2003, a 16.9% increase over second quarter 2002 earnings of $7.2 million.  Diluted earnings per share were $0.34 in the second quarter of 2003 compared to $0.29 in the like 2002 period.  For the six months year-to-date, net income was up 12.4% to $15.8 million in 2003 from $14.1 million in 2002, representing diluted earnings per share of $0.64 and $0.56, respectively.

 

“The Company’s results achieved in these difficult economic times are a testament to the efforts taken by our employees, officers and directors to offset the impact of the low rate environment,” said James W. Lokey, president and chief executive officer.  “We believe our solid performance will continue as a result of these efforts and new actions currently being taken.”

 

James G. Stathos, executive vice president and chief financial officer added, “We continue to focus our attention on expanding the fees generated from our mortgage banking operation.  Net fees generated by our mortgage operation totaled $2.5 million in the first six months of 2003 compared to $1.0 million in the 2002 period.  We have also implemented cost control measures that reduced our non-interest expense by $349,000 from the first quarter to the second quarter this year.”

 

 

Total assets of the Company were up 7.8% to $2.024 billion from $1.879 billion at June 30, 2002.  This growth was fueled by an increase in deposits of 8.8% to $1.740 billion, up from $1.599 billion one year earlier.  The growth in deposits was centered in core deposits.  While time deposits decreased to $397.6 million from one year earlier of $413.8 million, all other categories of demand, NOW, money market, and savings increased to $1.342 billion from $1.185 billion one year earlier.  In an ongoing effort to improve earnings, the Company continues to focus its attention on attracting lower cost core deposits while trying to remain competitive in retaining time deposits.  Loan activity over the last year has been slow with the loan portfolio holding steady at $1.102 billion at June 30, 2003, compared to one year earlier.  Consequently, the growth in deposits has funded a $95 million increase in Investments and Fed Funds Sold along with a $45 million increase in the total of Mortgage Loans Available for Sale.

 

During the first half of 2003, the Company continued its stock repurchase program, repurchasing 185,699 shares during the second quarter and 232,590 shares during the first quarter.  In the comparable 2002 period, the Company repurchased 75,457 shares in the second quarter and 24,481 shares in the first.  Management estimates that the effect of the stock repurchase program in 2003 has been to increase earnings per share by approximately one cent per share in the second quarter compared to what it would have been had no program been in place this year.  In other matters concerning capital, the dividend declared during the second quarter of 2003 was increased to $0.13 per share, up from $0.11 in the first quarter of 2003 and $0.10 per share one year earlier.

 

Non-performing asset levels totaled $16.4 million compared to $12.5 million one year earlier.  The level of non-performing assets as a percent of total assets was 0.8% compared to the 0.7% level of one year ago.  The level of non-performing assets is centered primarily in two lending relationships secured by real estate (total $14.4 million).  Management has established specific reserves that would offset potential losses, if any, arising from less than full recovery of the loans from the supporting collateral.  The ratio of the Company’s allowances for losses to non-performing loans was 120% compared to 166% one year earlier.  On a quarterly basis, management performs an analysis of the adequacy of the allowance for loan losses.  The results of this analysis

 

 

 

for the quarter ended June 30, 2003 determined that the allowance was adequate to cover losses inherent in the portfolio.

 

Mid-State Bancshares is a $2.0 billion holding company for Mid-State Bank & Trust, an independent, community bank serving California’s San Luis Obispo, Santa Barbara, and Ventura Counties.  Since opening its doors in 1961, the Bank has grown to 39 offices serving almost 100,000 households.

 

This Press Release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act. All of the statements contained in the Press Release, other than statements of historical fact, should be considered forward-looking statements, including, but not limited to, those concerning (i) the Bank’s strategies, objectives and plans for expansion of its operations, products and services, and growth of its portfolio of loans, investments and deposits, (ii) the Bank’s beliefs and expectations regarding actions that may be taken by regulatory authorities having oversight of the operation, (iii) the Bank’s beliefs as to the adequacy of its existing and anticipated allowances for loan and real estate losses and (iv) the Bank’s beliefs and expectations concerning future operating results. Although the Bank believes the expectations reflected in those forward-looking statements are reasonable, it can give no assurance that those expectations will prove to have been correct. All subsequent written and oral forward-looking statements by or attributable to the Bank or persons acting on its behalf are expressly qualified in their entirety by this qualification. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof and are not intended to give any assurance as to future results. The Bank undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

 

Please See Pertinent Financial Data Attached.

 

###

 

 

 

 

Consolidated Financial Data - Mid-State Bancshares

 

(Unaudited)

 

Quarter Ended

 

(In thousands)

 

June 30, 2003

 

Mar 31, 2003

 

Dec 31, 2002

 

Sept. 30, 2002

 

June 30, 2002

 

Interest Income (not taxable equivalent)

 

$

26,207

 

$

25,865

 

$

27,107

 

$

27,164

 

$

27,205

 

Interest Expense

 

2,568

 

2,834

 

3,404

 

4,020

 

4,167

 

Net Interest Income

 

23,639

 

23,031

 

23,703

 

23,144

 

23,038

 

Provision for Loan Losses

 

150

 

110

 

—

 

—

 

300

 

Net Interest Income after provision for loan losses

 

23,489

 

22,921

 

23,703

 

23,144

 

22,738

 

Non-interest income

 

7,484

 

6,914

 

6,419

 

6,175

 

5,744

 

Non-interest expense

 

18,026

 

18,375

 

17,441

 

18,267

 

17,330

 

Income before income taxes

 

12,947

 

11,460

 

12,681

 

11,052

 

11,152

 

Provision for income taxes

 

4,587

 

4,017

 

3,966

 

3,966

 

3,988

 

Net Income

 

$

8,360

 

$

7,443

 

$

8,715

 

$

7,086

 

$

7,154

 

 

 

 

Quarter Ended

 

(In thousands, except per share data)

 

June 30, 2003

 

Mar 31, 2003

 

Dec 31, 2002

 

Sept. 30, 2002

 

June 30, 2002

 

Per share:

 

 

 

 

 

 

 

 

 

 

 

Net Income - basic

 

$

0.36

 

$

0.32

 

$

0.37

 

$

0.30

 

$

0.30

 

Net Income - diluted

 

$

0.34

 

$

0.30

 

$

0.35

 

$

0.29

 

$

0.29

 

Weighted average shares used in Basic E.P.S. calculation

 

23,442

 

23,598

 

23,773

 

23,924

 

24,067

 

Weighted average shares used in Diluted E.P.S. calculation

 

24,477

 

24,638

 

24,769

 

24,815

 

24,892

 

Cash dividends

 

$

0.13

 

$

0.11

 

$

0.11

 

$

0.10

 

$

0.10

 

Book value at period-end

 

$

11.22

 

$

10.89

 

$

10.72

 

$

10.57

 

$

10.20

 

Tangible book value at period end

 

$

9.41

 

$

9.09

 

$

8.94

 

$

8.79

 

$

8.44

 

Ending Shares

 

23,384

 

23,488

 

23,697

 

23,839

 

24,050

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Ratios

 

 

 

 

 

 

 

 

 

 

 

Return on assets

 

1.68

%

1.55

%

1.79

%

1.47

%

1.54

%

Return on tangible assets

 

1.72

%

1.58

%

1.83

%

1.50

%

1.57

%

Return on equity

 

12.82

%

11.84

%

13.72

%

11.31

%

11.91

%

Return on tangible equity

 

15.29

%

14.18

%

16.48

%

13.63

%

14.46

%

Net interest margin (not taxable equivalent)

 

5.26

%

5.29

%

5.36

%

5.28

%

5.45

%

Net interest margin (taxable equivalent yield)

 

5.67

%

5.69

%

5.73

%

5.61

%

5.77

%

Net loan (recoveries) losses to avg. loans

 

(0.08

)%

(0.03

)%

0.61

%

0.62

%

0.05

%

Efficiency ratio

 

57.9

%

61.4

%

57.9

%

62.3

%

60.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Period Averages

 

 

 

 

 

 

 

 

 

 

 

Total Assets

 

$

1,990,671

 

$

1,947,332

 

$

1,935,767

 

$

1,914,466

 

$

1,867,782

 

Total Tangible Assets

 

1,948,523

 

1,905,206

 

1,893,659

 

1,872,173

 

1,825,298

 

Total Loans (include loans held for sale)

 

1,132,369

 

1,115,920

 

1,098,947

 

1,081,936

 

1,126,375

 

Total Earning Assets

 

1,801,275

 

1,764,490

 

1,755,655

 

1,739,554

 

1,696,190

 

Total Deposits

 

1,711,342

 

1,672,208

 

1,661,588

 

1,641,953

 

1,608,633

 

Common Equity

 

261,509

 

254,950

 

251,922

 

248,608

 

240,900

 

Common Tangible Equity

 

219,361

 

212,824

 

209,814

 

206,315

 

198,416

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet - At Period-End

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

124,176

 

$

113,257

 

$

128,036

 

$

110,454

 

$

115,891

 

Investments and Fed Funds Sold

 

680,320

 

669,990

 

625,483

 

637,124

 

585,313

 

Loans held for sale

 

49,875

 

26,794

 

22,560

 

3,760

 

4,801

 

Loans, net of deferred fees, before allowance for loan losses

 

1,102,210

 

1,095,355

 

1,087,551

 

1,106,184

 

1,101,695

 

Allowance for Loan Losses

 

(17,963

)

(17,576

)

(17,370

)

(17,465

)

(19,160

)

Goodwill and other intangibles

 

42,292

 

42,289

 

42,264

 

42,254

 

42,441

 

Other assets

 

43,344

 

47,772

 

46,216

 

45,711

 

47,610

 

Total Assets

 

$

2,024,254

 

$

1,977,881

 

$

1,934,740

 

$

1,928,022

 

$

1,878,591

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest bearing deposits

 

$

422,732

 

$

397,622

 

$

390,212

 

$

391,350

 

$

374,744

 

Interest bearing deposits

 

1,317,402

 

1,304,525

 

1,262,735

 

1,247,987

 

1,224,270

 

Other borrowings

 

6,354

 

2,382

 

10,973

 

11,574

 

12,696

 

Allowance for losses - unfunded commitments

 

1,812

 

1,811

 

1,771

 

1,687

 

1,687

 

Other liabilities

 

13,594

 

15,777

 

14,914

 

23,514

 

19,888

 

Shareholders’ equity

 

262,360

 

255,764

 

254,135

 

251,910

 

245,306

 

Total Liabilities and Shareholders’ equity

 

$

2,024,254

 

$

1,977,881

 

$

1,934,740

 

$

1,928,022

 

$

1,878,591

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset Quality & Capital - At Period-End

 

 

 

 

 

 

 

 

 

 

 

Non-accrual loans

 

$

16,436

 

$

16,799

 

$

16,748

 

$

10,729

 

$

12,449

 

Loans past due 90 days or more

 

1

 

—

 

—

 

4

 

68

 

Other real estate owned

 

—

 

—

 

—

 

—

 

—

 

Total non performing assets

 

$

16,437

 

$

16,799

 

$

16,748

 

$

10,733

 

$

12,517

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for losses to loans, gross (1)

 

1.8

%

1.8

%

1.8

%

1.7

%

1.9

%

Non-accrual loans to total loans, gross

 

1.5

%

1.5

%

1.5

%

1.0

%

1.1

%

Non performing assets to total assets

 

0.8

%

0.8

%

0.9

%

0.6

%

0.7

%

Allowance for losses to non performing loans (1)

 

120.3

%

115.4

%

114.3

%

178.4

%

166.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Equity to average assets (leverage ratio)

 

10.5

%

10.6

%

10.6

%

10.5

%

10.7

%

Tier One capital to risk-adjusted assets

 

14.6

%

14.6

%

14.7

%

14.5

%

14.7

%

Total capital to risk-adjusted assets

 

15.8

%

15.9

%

16.0

%

15.7

%

16.0

%

 

(1)   Includes allowance for loan losses and allowance for losses - unfunded commitments