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UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 8-K
CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Date of Report (Date of earliest event reported): July 17, 2007
SAN JOAQUIN BANCORP __________________________________________________________________________________________________________________________ (Exact name of registrant as specified in charter) |
California | 000-52165 | 20-5002515 | ||
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(State or Other Jurisdiction of | (Commission File Number) | (IRS Employer Identification No.) | ||
Incorporation) |
1000 Truxtun Avenue, Bakersfield, California 93301
(Address of Principal Executive Offices) (Zip Code) |
661-281-0360 |
_________________________________________________________________________________________________________________________________________
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On July 17, 2007, the Registrant announced its earnings for the quarter ended June 30, 2007. Attached as Exhibit 99.1 and incorporated herein by reference is a copy of the press release dated July 17, 2007.
Item 9.01. Financial Statements and Exhibits. |
(c) The following exhibits are included with this Report: Exhibit 99.1 Press release dated July 17, 2007.
SIGNATURES |
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
SAN JOAQUIN BANCORP |
By: | /s/ Stephen M. Annis | |
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Executive Vice President | ||
and Chief Financial Officer | ||
Date: July 19, 2007 |
EXHIBIT 99.1 |
SAN JOAQUIN BANCORP
Administrative Offices |
1000 Truxtun Avenue | Phone: (661) 281-0360 | |
Bakersfield, CA 93301 | Fax: (661) 281-0366 |
News Release |
San Joaquin Bancorp Exceeds Expectations for Loan and Deposit Growth through June 2007
BAKERSFIELD, Calif., July 17, 2007 (Business Wire):
San Joaquin Bancorp (OTCBB: SJQU), a bank holding company with $771 million in assets, today announced financial results for the second quarter ended June 30, 2007.
Total loans and deposits exceeded expectations for growth for the first half of 2007 with total loans, net of unearned fees, up over 22% and total deposits up over 18%. Total loans, net of unearned fees, increased by $106 million to $580 million at June 30, 2007 compared to $474 million at June 30, 2006. Total deposits increased by $105 million to $686 million as compared to $581 million at June 30, 2006. Overall, total assets grew by $84 million or 12.2% from $687 million at the end of the 2nd quarter of 2006 to $771 million at the end of June 2007.
Net income after tax for the second quarter of 2007 was $2.36 million compared to $2.58 million reported for the second quarter of 2006, a decrease of 8.7% . Earnings per share (EPS) for the second quarter of 2007 were $0.63 per diluted share compared to $0.69 per diluted share reported in the second quarter of 2006, which is a decrease of 8.7% . Net income for the 2nd quarter of 2006 included a nonrecurring tax refund of $243,000 or $0.06 per share. Excluding the refund, net income for the 2nd quarter of 2006 was $2.34 million and EPS were $0.63 per diluted share.
For the first six months of 2007, net income after tax was $4.57 million, a decrease of 4.5% compared to $4.79 million reported for the first six months of 2006. EPS for the first six months of 2007 were $1.23 per diluted share compared to $1.29 per diluted share reported in the second quarter of 2006, which is a decrease of 4.7% . Excluding the 2006 tax refund, net income for the first half of 2007 was slightly more than 2006 year-to-date net income of $4.55 million and EPS remained unchanged at $1.23 per diluted share.
Bart Hill, President and CEO said, We continue to focus on implementing strategies that will increase shareholder value for the remainder of the year and are pleased with the results given the challenging interest rate environment. Although earnings were down slightly compared to 2006, loan and deposit growth exceeded our projections for the first half of the year. It should also be remembered that earnings for the first half of 2006 were up 54% and included a one time tax refund. We believe that the growth so far this year well positions our Company for the next six months. Operating efficiency also remained strong with a year-to-date efficiency ratio of 48.63% .
Highlights for the Quarter: |
Income Statement |
Total interest income for the second quarter of 2007 was $13.7 million compared to $11.3 million reported in the same quarter 2006, an increase of $2.4 million, or 21.0% . The annualized yield on average earning assets increased from 7.41% to 7.74% on a quarterly comparative basis year over year. Of the increase in yield, annualized loan yield year over year remained virtually unchanged from 8.52% in 2006 to 8.51% in 2007. The annualized yield on investments, including federal funds sold and interest-bearing balances, increased to 4.44% for the 2nd quarter ended June 30, 2007, compared to 4.25% for 2nd quarter e nded June 30, 2006, due primarily to maturities of lower yielding investments and subsequent reinvestment of proceeds in higher yielding assets. Average earning assets as a percent of total average assets increased slightly to 93.1% at 2nd quarter ended 2007 compared to 92.6% at 2nd quarter end in 2006.
Interest expense for the second quarter of 2007 was $6.3 million compared to $4.0 million for the second quarter of 2006, an increase of 55.6% . Short-term interest rates continue to be the primary driver behind the increase. Average interest-bearing liabilities as a percent of total average assets were 70.7% at June 30, 2007 compared to 66.5% at June 30, 2006 with the increase due primarily to increases in savings and time deposit balances.
Net interest margin decreased in the comparative second quarters from 4.78% in 2006 to 4.20% in 2007. The decrease is primarily due to the increased interest expense based on the factors explained above.
Non-interest income was $865,000 for the second quarter of 2007 compared to $853,000 for the same period in 2006, an increase of 1.4% . This improvement is mostly due to an increase in cash surrender value of life insurance and fees on deposits.
Non-interest expense increased on a quarterly basis for the 2nd quarter to $4.1 million in 2007 from $3.7 million in 2006, an increase of approximately 8.8% . The increase includes normal adjustments for salaries and employee benefits, staff additions and increased accrual of expense associated with salary continuation plans for executive officers. The banks efficiency ratio, the measure of operating expense as a percent of net interest income plus non-interest income, increased from 45.9% in the second quarter 2006 to 49.0% as of June 30, 2007, which remains favorable compared to industry peer group ratios.
Annualized return on average assets (ROAA) decreased to 1.24% in the second quarter 2007 compared to 1.56% in the second quarter 2006. Annualized return on average equity (ROAE) decreased from 24.48% for the quarter ended June 30, 2006 to 19.32% at June 30, 2007. Excluding the nonrecurring tax refund noted above, the 2006 2nd quarter ROAA and ROAE were 1.42% and 22.18%, respectively.
Balance Sheet |
Total loans, net of unearned fees, were $580 million at June 30, 2007 compared to $474 million at the end of the second quarter of 2006, an increase of 22.3% . The anticipated increase is primarily attributable to growth in construction loans and loans secured by farmland.
Total deposits were $686 million as compared to $581 million at June 30, 2006. The increase of $105 million, or 18.1%, is primarily due to growth in savings and time deposits.
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Non-core funding, consisting of time deposits of $100,000 or more and Federal Home Loan Bank (FHLB) advances, decreased from $70.3 million in 2006 to $56.3 million in 2007 for the comparative 2nd quarters due to increased core funding from savings and time deposits. Net non-core funding accounted for approximately 4.1% of total funding needs at June 30, 2007 compared to 8.1% at June 30, 2006.
Asset Quality |
Net loan charge offs were $29,000 in the first six months of 2007 compared to net recoveries of previously charged-off loans of $13,000 for the same period in 2006. The allowance for loan losses was $8.8 million or 1.52% of loans at June 30, 2007 compared to $7.5 million or 1.60% of loans at June 30, 2006.
Nonperforming and restructured loans were $4,584,000 at June 30, 2007, compared to $355,000 at June 30, 2006. The percentage of nonperforming and restructured loans to total loans, net of unearned income, was 0.79% at the end of the second quarter of 2007 compared to 0.07% at the end of the second quarter in 2006.
Total nonperforming and restructured assets were $5.6 million at June 30, 2007, compared to $1.0 million at June 30, 2006. Nonperforming and restructured assets as a percentage of total assets were 0.72% and 0.15% at the second quarter of 2007 and 2006, respectively.
San Joaquin Bancorp assesses and manages credit risk on an ongoing basis through a formal credit review program and approval policies, internal monitoring and formal lending policies of its wholly-owned bank subsidiary, San Joaquin Bank. The Company believes that the Banks ability to identify and assess risk and return characteristics of the loan portfolio is critical for profitability and growth of the consolidated group. The Company, through the Bank, emphasizes credit quality in the loan approval process, active credit administration and regular monitoring. The Bank has designed and implemented a comprehensive loan review and grading system that functions to monitor and assess the credit risk inherent in the loan portfolio.
Capital |
Total shareholders equity at June 30, 2007 increased to $50.2 million compared to $43.5 million at June 30, 2006. Capital ratios for the Bank remain above the well-capitalized guidelines established by bank regulatory agencies.
Additional Information |
San Joaquin Bancorp is a bank holding company formed in 2006 and is subject to the regulatory oversight of the Board of Governors of the Federal Reserve System. San Joaquin Bank, wholly-owned by San Joaquin Bancorp, is an insured state-chartered member bank of the Federal Reserve System. The Bank was established in 1980 and is headquartered in Bakersfield, California. San Joaquin Bank is a full-service, community bank with three banking offices in Bakersfield and one in Delano. San Joaquin Bank emphasizes professional, personal banking service directed primarily to small and medium-sized businesses and professionals. The Bank also provides a full range of banking services that are available to individuals, public entities, and non-profit organizations.
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FORWARD-LOOKING INFORMATION: |
The following appears in accordance with the Private Securities Litigation Reform Act of 1995:
This press release contains forward-looking statements about San Joaquin Bancorp for which it claims the protection of the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995, including statements with regard to descriptions of our plans or objectives for future operations, products or services, and forecasts of our revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors -- many of which are beyond our control -- could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements and reported results should not be considered an indication of our future performance. Some of these risk factors include, among others, certain credit, market, operational and liquidity risks associated with our business and operations, changes in business and economic conditions in California and nationally, rising interest rates, potential acts of terrorism (which are beyond our control), volatility of rate sensitive deposits and assets, value of real estate collateral securing many of our loans, accounting estimates and judgments, compliance costs associated with the companys internal control structure and procedures for financial reporting. These risk factors are not exhaustive and additional factors that could have an adverse effect on our business and financial performance are set forth under Risk Factors and elsewhere in this quarterly report and in our annual report on Form 10-K.
Forward-looking statements speak only as of the date they are made. We do not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward-looking statements are made.
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San Joaquin Bancorp and Subsidiaries | ||||
Consolidated Balance Sheet (unaudited) | ||||
As of June 30
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2007 | 2006 | |||
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ASSETS | ||||
Cash and due from banks | $ 31,848,000 | $ 34,322,000 | ||
Interest-bearing deposits in banks | 621,000 | 2,423,000 | ||
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Total cash and cash equivalents | 32,469,000 | 36,745,000 | ||
Investment securities | ||||
Held to maturity | 120,761,000 | 144,990,000 | ||
Available-for-sale | 6,936,000 | 6,928,000 | ||
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Total Investment Securities | 127,697,000 | 151,918,000 | ||
Loans, net of unearned income | 580,378,000 | 474,392,000 | ||
Less: allowance for loan losses | (8,831,000) | (7,546,000) | ||
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Net Loans | 571,547,000 | 466,846,000 | ||
Premises and equipment | 9,152,000 | 7,802,000 | ||
Investment in real estate | 989,000 | 676,000 | ||
Interest receivable and other assets | 28,787,000 | 23,146,000 | ||
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TOTAL ASSETS | $ 770,641,000 | $ 687,133,000 | ||
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LIABILITIES | ||||
Deposits: | ||||
Noninterest-bearing | $ 170,694,000 | $ 171,692,000 | ||
Interest-bearing deposits | 515,726,000 | 409,766,000 | ||
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Total Deposits | 686,420,000 | 581,458,000 | ||
Short-term borrowings | 6,900,000 | 49,800,000 | ||
Long-term debt | 17,092,000 | 5,538,000 | ||
Accrued interest payable and other liabilities | 10,031,000 | 6,793,000 | ||
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Total Liabilities | 720,443,000 | 643,589,000 | ||
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SHAREHOLDERS' EQUITY | ||||
Common stock, no par value - 20,000,000 shares authorized; | ||||
3,534,022 and 3,486,222 issued and outstanding | ||||
at June 30, 2007 and December 31, 2006, respectively | 10,871,000 | 10,259,000 | ||
Additional paid-in capital | 301,000 | 64,000 | ||
Retained earnings | 40,606,000 | 33,400,000 | ||
Accumulated other comprehensive income (loss) | (1,580,000) | (179,000) | ||
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Total Shareholders' Equity | 50,198,000 | 43,544,000 | ||
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 770,641,000 | $ 687,133,000 | ||
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San Joaquin Bancorp and Subsidiaries | ||||||||
Consolidated Statement of Income (unaudited) | ||||||||
Three Months Ended June 30 | Six Months Ended June 30 | |||||||
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2007 | 2006 | 2007 | 2006 | |||||
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INTEREST INCOME | ||||||||
Loans (including fees) | $ 12,231,000 | $ 9,647,000 | $ 23,645,000 | $ 18,184,000 | ||||
Investment securities | 1,429,000 | 1,627,000 | 2,944,000 | 3,249,000 | ||||
Fed funds & other interest-bearing balances | 59,000 | 66,000 | 127,000 | 343,000 | ||||
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Total Interest Income | 13,719,000 | 11,340,000 | 26,716,000 | 21,776,000 | ||||
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INTEREST EXPENSE | ||||||||
Deposits | 5,650,000 | 3,632,000 | 11,008,000 | 6,953,000 | ||||
Short-term borrowings | 310,000 | 277,000 | 400,000 | 279,000 | ||||
Long-term borrowings | 307,000 | 118,000 | 611,000 | 232,000 | ||||
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Total Interest Expense | 6,267,000 | 4,027,000 | 12,019,000 | 7,464,000 | ||||
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Net Interest Income | 7,452,000 | 7,313,000 | 14,697,000 | 14,312,000 | ||||
Provision for loan losses | 225,000 | 300,000 | 450,000 | 530,000 | ||||
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Net Interest Income After Loan Loss Provision | 7,227,000 | 7,013,000 | 14,247,000 | 13,782,000 | ||||
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NONINTEREST INCOME | ||||||||
Service charges & fees on deposits | 222,000 | 195,000 | 432,000 | 391,000 | ||||
Other customer service fees | 339,000 | 340,000 | 618,000 | 632,000 | ||||
Other | 304,000 | 318,000 | 555,000 | 486,000 | ||||
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Total Noninterest Income | 865,000 | 853,000 | 1,605,000 | 1,509,000 | ||||
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NONINTEREST EXPENSE | ||||||||
Salaries and employee benefits | 2,547,000 | 2,286,000 | 4,914,000 | 4,563,000 | ||||
Occupancy | 226,000 | 220,000 | 469,000 | 436,000 | ||||
Furniture & equipment | 262,000 | 277,000 | 501,000 | 523,000 | ||||
Promotional | 187,000 | 144,000 | 337,000 | 302,000 | ||||
Professional | 328,000 | 341,000 | 717,000 | 580,000 | ||||
Other | 526,000 | 480,000 | 989,000 | 947,000 | ||||
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Total Noninterest Expense | 4,076,000 | 3,748,000 | 7,927,000 | 7,351,000 | ||||
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Income Before Taxes | 4,016,000 | 4,118,000 | 7,925,000 | 7,940,000 | ||||
Income Taxes | 1,659,000 | 1,536,000 | 3,353,000 | 3,152,000 | ||||
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NET INCOME | $ 2,357,000 | $ 2,582,000 | $ 4,572,000 | $ 4,788,000 | ||||
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Basic Earnings per Share | $ 0.67 | $ 0.74 | $ 1.30 | $ 1.38 | ||||
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Diluted Earnings per Share | $ 0.63 | $ 0.69 | $ 1.23 | $ 1.29 | ||||
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San Joaquin Bancorp and Subsidiaries | ||||||
Financial Highlights (unaudited) | ||||||
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(data in thousands except per share data) | ---First 6 Months--- | % Variance | ||||
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(unaudited) | 2007 | 2006 | 2007 vs. 2006 | |||
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Net Interest Income | $ 14,697 | $ 14,312 | 2.7% | |||
Non Interest Income | $ 1,605 | $ 1,509 | 6.4% | |||
Addition to Provision for Loan Losses | $ 450 | $ 530 | -15.1% | |||
Net Income | $ 4,572 | $ 4,788 | -4.5% | |||
Total Assets | $ 770,641 | $ 687,133 | 12.2% | |||
Total Loans, Net of Unearned Income | $ 580,378 | $ 474,392 | 22.3% | |||
Total Deposits | $ 686,420 | $ 581,458 | 18.1% | |||
Total Shareholders Equity | $ 50,198 | $ 43,544 | 15.3% | |||
Basic Earnings per Share | $ 1.30 | $ 1.38 | -5.8% | |||
Diluted Earnings per Share | $ 1.23 | $ 1.29 | -4.7% | |||
Book Value per Share | $ 14.20 | $ 11.78 | 20.6% | |||
Key Ratios: | ||||||
Annualized Return on Average Equity | 19.35% | 23.38% | ||||
Annualized Return on Average Assets | 1.23% | 1.47% | ||||
Annualized Net Interest Margin | 4.27% | 4.76% | ||||
Efficiency Ratio | 48.63% | 46.46% |
San Joaquin Bancorp Contact Information:
Bart Hill President (661) 281-0300 |
Stephen M. Annis
Executive Vice President & Chief Financial Officer
(661) 281-0360
Company Website: www.sjbank.com |
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