EX-99 3 a4378576ex99.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 CCBT Financial Companies, Inc. Report 2003 First Quarter Results SOUTH YARMOUTH, Mass.--(BUSINESS WIRE)--April 17, 2003--CCBT Financial Companies, Inc. (NASDAQ: CCBT) Chief Executive Officer and President Stephen B. Lawson announced a first quarter 2003 loss of $1.5 million compared to earnings of $5.0 million in the same period last year. This represents a loss of $.17 per diluted share, as compared to earnings of $.58 per diluted share in the first quarter of 2002. Mr. Lawson stated, "CCBT's 2003 first quarter loss was the result of the March 5, 2003 amendment of Massachusetts' law that expressly disallows the deduction for dividends received from a real estate investment trust subsidiary (a "REIT"). We accrued a liability in the first quarter of 2003 of approximately $5.1 million, representing an estimate of the additional state tax liability of $7.1 million and including interest of $802,000 (net of any federal and state tax deductions associated with such taxes and interest), relating to the deduction for dividends received from a REIT for the 1999 through 2001 fiscal years, and the anticipated deduction for fiscal 2002, thus reducing earnings by $5.1 million in the first quarter of 2003. As a result of the enactment of this legislation, we have ceased recording the tax benefits associated with the dividend received deduction effective for the 2003 tax year. We believe that this legislation will be challenged, especially the retroactive provisions, on constitutional and other grounds. We would support such a challenge and otherwise intend to defend vigorously our position. Earnings for the quarter would have been positive if not for the REIT tax adjustment." The return (loss) on average equity and assets for the first quarter of 2003 were (5.08%) and (0.43%) compared to 17.54% and 1.43%, respectively for the same quarter in 2002. Mr. Lawson stated, "The extended environment of lower interest rates accompanying weak domestic economic activity has constrained our ability to maximize earnings potential from our significant base of low and non-interest bearing deposits. Coupled with significant pre-payments of our residential real estate portfolio and holdings of mortgage related investment securities, net interest income for the March 2003 quarter declined 10% below last year's levels resulting in net interest income of $10.8 million as compared to $12.0 million in the corresponding period last year. Net interest margin declined to 3.35% from 3.62%, as rates on interest earning assets continue to reprice faster than our ability to lower funding costs in deposits and borrowings." "We are continuing to pursue our long range strategy of providing a wide range of financial services to our clients," commented Lawson, "while maintaining a strong capital position and asset quality. The fruits of this strategy are evident in the 16.3% increase in non-interest income for the first quarter of 2003 to $5.2 million compared to $4.5 million in the first quarter of 2002, excluding net gains from discretionary sales of securities and loans. The solid growth in fee-based revenues, derived from investment management fees, insurance commissions, brokerage fees, as well as branch and electronic based deposit banking fees, is a reflection of our commitment to continually expanding our products and expertise in these areas. Delivering this expertise out to our offices has been the focus of this first quarter, through the placing of broadly skilled financial advisors right at the front door of fifteen of our offices." Non-interest expense increased $1.0 million or 9.2% from $11.2 million in the first quarter of 2002 to a level of $12.2 million for the first quarter of 2003. Interest of $802,000 accrued on the aforementioned retroactive REIT state tax liability is the largest component of the year-over-year quarterly increase in non-interest expense. Expenses related to the expansion in financial service offices account for the remaining increase in non-interest expense. Mr. Lawson commented, "Stockholder's equity to assets ratios stood at 8.4% and 8.3%, respectively, as stockholder's equity on March 31, 2003 was $111.9 million as compared to $117.3 million a year ago. Total non-performing assets remained relatively unchanged from $3.3 million to $3.8 million at March 31, 2002 and 2003, respectively. The allowance for loan losses was $12.6 million on March 31, 2003, up slightly from $12.3 million a year ago. As residential mortgage loans have declined $127.0 million, borrowings from the FHLBB have correspondingly declined by $122.4 million. Partially offsetting the lower levels of residential mortgages and borrowings, investment securities increased $34.3 million primarily funded by overall deposit growth of $38.4 million, resulting in total assets decreasing $85.5 million year over year. Sustaining net interest income in the continued low interest rate environment presents a challenge as a significant portion of our liabilities have limited repricing opportunity." CCBT Financial Companies, Inc. declared a $0.19 quarterly dividend on April 10, 2003 to be paid April 30, 2003 to stockholders of record April 21, 2003. CCBT Financial Companies, Inc. is a bank holding company with total assets of $1.3 billion on March 31, 2003. Its subsidiary, Cape Cod Bank and Trust Company, N.A., owns CCBT Brokerage Direct and a 51% interest in Murray & MacDonald Insurance Services, Inc. The Company offers a wide range of financial products and services including deposit services, loans, municipal services, insurance, trust, investments and retirement services to individuals, municipalities and businesses. To find out more about CCBT Financial Companies, Inc. and our services, please visit our web site at www.ccbt.com or better yet, stop in for a visit at one of our thirty-four branch locations. This report may contain statements that are not historical facts and are considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, future financial results of the Company. You should not rely on forward-looking statements because the Company's actual results may differ materially from those indicated by these forward-looking statements as a result of a number of important factors. These factors include, but are not limited to, changes in prevailing interest rates, which may reduce interest margins and adversely affect net interest income, changes in economic conditions and equity and fixed income market fluctuations. Reference is made to the Company's annual report on Form 10-K and other filings submitted to the Securities and Exchange Commission for factors that could cause actual results to differ materially from those anticipated. Our quarterly financial report on Form 10-Q, filed with the SEC, will be available on our web site and will contain more detailed financial information. ASSETS ($000) 03/31/03 12/31/02 03/31/02 Cash & cash equivalents 62,887 60,798 83,018 Securities available for sale 420,130 510,837 385,751 Other securities 24,738 24,738 24,738 Construction loans 90,447 99,544 100,742 Commercial mortgages 283,814 283,458 265,467 Commercial loans 90,860 84,882 90,265 Residential mortgages 235,444 262,095 362,391 Home equity loans 69,091 65,794 56,585 Other consumer loans 5,584 5,629 6,682 Total portfolio loans 775,240 801,402 882,132 Loans held for sale 7,184 37,332 5,058 Loan loss reserve (12,596) (12,384) (12,336) Goodwill 803 803 954 Other intangibles 5,205 5,511 6,430 Total intangible assets 6,008 6,314 7,384 Mortgage servicing rights 2,500 2,088 1,515 Real estate owned 1,500 1,500 1,500 Other assets 43,541 49,258 37,877 Total assets 1,331,132 1,481,883 1,416,637 LIABILITIES ($000) Savings/NOW accounts 273,219 259,587 318,466 Money market deposits 293,928 294,295 195,449 Other consumer time 120,311 121,961 143,213 Time deposits over $100,000 38,348 37,344 46,206 Short-term borrowings 140,749 227,091 186,361 Long-term borrowings 118,233 170,750 163,979 Total interest-bearing liab. 984,788 1,111,028 1,053,674 Demand deposits 220,684 229,033 204,749 Minority interest 253 234 0 Other liabilities 13,496 23,142 40,875 Total liabilities 1,219,221 1,363,437 1,299,298 EQUITY ($000) Common equity 111,911 118,447 117,339 Net unrealized loss on AFS securities (2,290) (1,018) 1,315 Book value per share 13.17 13.79 13.60 Common shares issued 9,061,064 9,061,064 9,061,064 Treasury shares (560,366) (470,266) (433,266) Common shares outstanding 8,500,698 8,590,798 8,627,798 INCOME STATEMENT ($000) 1st Quarter 1st Quarter 03 02 Interest income 16,051 19,197 Interest expense 5,237 7,186 Net interest income 10,814 12,011 Net interest income (FTE) 10,899 12,120 Loan loss provision 0 0 Gain on securities 1 1,679 Financial advisor fees 1,919 1,720 Service charge on deposits 583 559 Gain on sale of loans 1,508 576 Other noninterest income 2,675 2,174 Total noninterest income 6,686 6,708 Employee salaries and benefits 6,202 6,138 Occupancy and equipment 1,507 1,464 Foreclosed property expense 33 29 Amortization of intangibles 306 306 Deposit insurance expense 43 41 Other noninterest expense 4,130 3,192 Total noninterest expense 12,221 11,170 Net income before taxes 5,279 7,549 Tax provision 6,760 2,502 Net (loss) income (1,481) 5,047 Basic EPS (0.17) 0.59 Diluted EPS (0.17) 0.58 Dividends per common share 0.19 0.19 Avg shares for basic EPS 8,563 8,622 Avg shares for diluted EPS 8,584 8,657 AVE. BALANCE SHEET ($000) 1st Quarter 1st Quarter 03 02 Taxable securities 481,992 441,324 Tax-exempt securities 23,579 23,499 Total portfolio loans 793,273 875,743 Loans held for sale 10,862 5,714 Other earning assets 0 0 Total earning assets 1,309,706 1,346,280 Total assets 1,375,587 1,416,137 Savings/NOW accounts 257,400 222,254 Money market deposits 290,393 271,632 Other consumer time 119,959 144,929 Time deposits over $100,000 37,443 49,654 Total interest-bearing deposits 705,195 688,469 Short-term borrowings 207,655 228,712 Long-term borrowings 125,283 173,984 Total interest-bearing liab. 1,038,133 1,091,165 Demand deposits 216,984 199,400 Minority interest 253 234 Other liabilities 3,499 10,237 Total liabilities 1,258,869 1,301,036 Common equity 116,718 115,101 Return (loss) on average assets (0.43%) 1.43% Return (loss) on average equity (5.08%) 17.54% CHARGEOFFS ($000) 1st Quarter 1st Quarter 03 02 Loan chargeoffs (22) (27) Recoveries 234 111 Net loan charge-offs(recoveries) (212) (84) ASSET QUALITY ($000) 03/31/03 3/31/02 12/31/02 Nonaccrual loans 2,313 1,815 1,348 Renegotiated loans 208 223 210 Other real estate owned 1,500 1,500 1,500 Total nonperforming assets 3,813 3,315 2,848 SUPPLEMENTAL DATA 03/31/03 03/31/02 12/31/02 Loans serviced f/others ($000) 372,428 225,717 322,085 FTE employees 394 398 402 Number of full service offices 34 29 34 Number of subsidiaries 2 2 2 Number of ATM's 42 35 42 CONTACT: CCBT Financial Companies, Inc. Phillip W. Wong, 508/760-8306