8-K

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 21, 2003

YARDVILLE NATIONAL BANCORP

(Exact name of issuer as specified in charter)

 

NEW JERSEY	0-26086	22-2670267
(State or Other Jurisdiction of Incorporation or Organization)	(Commission file number)	(I.R.S. Employer Identification Number)

2465 KUSER ROAD
HAMILTON, NEW JERSEY 08690

(Address of principal executive offices)

(609) 585-5100

(Registrant’s telephone number, including area code)

TABLE OF CONTENTS

	Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
	Item 9. Regulation FD Disclosure.
	Item 12. Results of Operations and Financial Condition.
Signatures
Index to Exhibits
YARDVILLE NATIONAL BANCORP PRESS RELEASE 07/21/03

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

(c) Exhibits

Exhibit No.	Description
99.1	Yardville National Bancorp Press Release dated July 21, 2003

Item 9. Regulation FD Disclosure.

This Current Report on Form 8-K is being furnished pursuant to Item 12, “Results of Operations and Financial Condition,” in accordance with interim procedures promulgated by the Securities and Exchange Commission in Release No. 34-47583 issued March 27, 2003. See “Item 12. Results of Operations and Financial Condition” below, which is incorporated herein by reference.

Item 12. Results of Operations and Financial Condition.

On July 21, 2003, Yardville National Bancorp issued a press release reporting its financial results for the second quarter ended June 30, 2003. A copy of the press release is attached as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference.

Signatures

     Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

	YARDVILLE NATIONAL BANCORP
Date: July 23,2003	By:	/s/ Stephen F. Carman
		Stephen F. Carman Vice President and Treasurer

Index to Exhibits

Exhibit No.	Description
99.1	Yardville National Bancorp Press Release dated July 21, 2003

EX-99.1 3 w88603exv99w1.htm YARDVILLE NATIONAL BANCORP PRESS RELEASE 07/21/03

Exhibit 99.1

L. G. ZANGANI, LLC
(908) 788-9660 Fax: (908) 788-4024
Nine Main Street, Flemington, NJ 08822
E-mail: office@zangani.com
Web site: http://www.zangani.com

For Release: IMMEDIATELY

Contact: Stephen F. Carman, VP/Treasurer (609) 631-6222
For further information see Investor Relations on YNB’s website: www.ynb.com
Kevin Nally, LG Zangani LLC (908) 788-9660

YARDVILLE NATIONAL BANCORP REPORTS SECOND QUARTER EARNINGS

Hamilton, N.J.- July 21, 2003- Yardville National Bancorp (NASDAQ: YANB) today announced that for the quarter ended June 30, 2003, YNB’s net income increased to $3.6 million, up 1.7 percent from the $3.5 million earned in the same period a year ago. Earnings per share on a diluted basis decreased 20.9 percent to $0.34 compared to $0.43 earned in the same period in 2002.

For the six months ended June 30, 2003, YNB’s net income decreased 1.1 percent to $6.9 million from the $7.0 million earned in the same period a year ago. Earnings per share on a diluted basis for the first half of 2003 decreased 23.3 percent to $0.66 from the $0.86 per diluted share reported in the prior year’s first half. The decrease in earnings per share on a quarterly and year-to-date basis is primarily the result of higher average shares outstanding due to the issuance of 2.3 million shares in a public common stock offering completed in December 2002.

Despite some adverse economic conditions, YNB has maintained its steady growth in net interest income. Led by commercial loans, net interest income increased 13.2 percent in the first six months of 2003 compared to the same period in 2002. This growth in net interest income was offset by an increase in non-interest expenses and also by a decrease in net securities gains, resulting in lower net income for the first six months of 2003 compared to the same time period in 2002.

“We experienced modest improvement in our net interest margin in the second quarter of 2003 compared to the first quarter of this year,” explained YNB President and CEO Patrick M. Ryan. “Should the historically low interest rate environment continue, however, we would expect limited opportunities to expand our margin. In addition, anticipated increases in operating expenses to support expansion in our new and existing markets could continue to limit income growth,” he said.

At June 30, 2003, total loan outstandings, led by commercial loans, increased 24.1 percent over the same date a year ago, reaching $1.33 billion compared with a total of $1.07 billion twelve months ago. Credit quality has remained strong during this period of robust loan growth. Nonperforming assets increased $1.6 million in the second quarter of 2003 to $9.0 million compared to $7.4 million in the second quarter of 2002. Nonperforming assets as a percent of total assets increased to 0.38 percent at June 30, 2003 compared to 0.35 percent at June 30, 2002. The allowance for loan losses at June 30, 2003 totaled $17.5 million, or 1.31 percent of total loans, covering 238.6 percent of total nonperforming loans.

Total deposits increased 15.8 percent to $1.41 billion at June 30, 2003 from $1.22 billion in total deposits at June 30, 2002, funding YNB’s expanding commercial loan portfolio. Continuing its northward expansion, YNB opened another new branch – its first in Somerset County – in the second quarter of 2003. Earlier in the year, YNB introduced “Simply Better Checking” in Bucks County, Pennsylvania and the northern region, which includes Hunterdon, Middlesex and Somerset Counties in New Jersey. This relationship-oriented promotion has resulted in approximately $50 million in new deposits.

“We continue to explore new opportunities for growth, both in Mercer and in our northern region, as well as other target markets,” explained YNB Chairman Jay G. Destribats. “This way, we serve our communities by bringing our unique brand of customer service to new neighborhoods, and strengthen the bank at the same time.”

“By opening new branches and reinforcing our brand image, we expect to gain and retain profitable individual banking business,” added Mr. Ryan. “We believe that increasing our retail presence will reduce our cost of funds, improve our net interest margin, and increase the value of our franchise,” he concluded.

At June 30, 2003, the capital ratios for YNB continued to exceed those required by regulatory authorities to be considered a well-capitalized institution. In the first two quarters of 2003, YNB paid total cash dividends of $0.23 per share, an increase of 4.5 percent compared to the same period in 2002.

YNB had $2.35 billion in assets as of June 30, 2003, with twenty branches serving individuals and businesses in Mercer, Hunterdon, Burlington, Middlesex and Somerset counties in New Jersey and Bucks County in Pennsylvania. Located in the corridor between New York City and Philadelphia, YNB offers a broad range of lending, deposit and other financial products and services with an emphasis on commercial real estate and commercial and industrial lending.

Note regarding forward-looking statements

This press release and other statements made from time to time by our management contain express and implied statements relating to our future financial condition, results of operations, plans, objectives, performance, and business, which are considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These may include statements that relate to, among other things, profitability, liquidity, loan loss reserve adequacy, plans for growth, interest rate sensitivity, market risk, regulatory compliance, and financial and other goals. Actual results may differ materially from those expected or implied as a result of certain risks and uncertainties, including, but not limited to, the results of our efforts to implement our retail strategy, adverse changes in our loan portfolio and the resulting credit risk-related losses and expenses, interest rate fluctuations and other economic conditions, our ability to attract core deposits, continued relationships with major customers, competition in product offerings and product pricing, adverse changes in the economy that could increase credit-related losses and expenses, compliance with laws and regulatory requirements of federal and state agencies, other risks and uncertainties detailed from time to time in our filings with the SEC, as well as other risks and uncertainties detailed from time to time in statements made by our management.

L.G. Zangani, LLC provides financial public relations service to the Company. As such, L.G. Zangani, LLC and/or its officers, agents and employees, receives remuneration for public relations and/or other services performed for the Company. This remuneration may take the form of cash, capital stock in the Company, or warrants and/or options to purchase stock in the Company.

Yardville National Bancorp
Summary of Financial Information
(Unaudited)

				Three Months Ended						Six Months Ended
				June 30,						June 30,
(in thousands, except per share amounts)				2003			2002			2003			2002
Stock Information:
Weighted average shares outstanding:
	Basic				10,395			8,025			10,396			8,018
	Diluted				10,614			8,229			10,590			8,170
Shares outstanding end of period					10,416			8,045
Earnings per share:
	Basic			$	0.35		$	0.44		$	0.67		$	0.88
	Diluted				0.34			0.43			0.66			0.86
Dividends paid per share					0.115			0.11			0.23			0.22
Book value per share					14.28			12.90
Closing price per share					19.52			19.94
Closing price to book					136.69	%		154.57	%
Key Ratios:
Return on average assets					0.62	%		0.69	%		0.61	%		0.70	%
Return on average stockholders’ equity					9.73			14.12			9.46			14.41
Net interest margin (tax equivalent)					2.37			2.41			2.34			2.35
Equity-to-assets at period end					6.30			4.90
Tier 1 leverage ratio (1)					7.75			6.52
Asset Quality Data:
Net loan charge-offs				$	303		$	23		$	1,163		$	69
Nonperforming assets as a percentage of total assets					0.38	%		0.35	%
Allowance for loan losses at period end as a percent of:
		Total loans			1.31			1.41
		Nonperforming loans			238.59			247.75
Nonperforming assets at period end:
	Nonperforming loans			$	7,338		$	6,094
	Other real estate				1,651			1,257
			Total nonperforming assets	$	8,989		$	7,351

(1)  Tier 1 leverage ratio is Tier 1 capital to adjusted average assets

Yardville National Bancorp and Subsidiaries
Consolidated Statements of Income
(Unaudited)

			Three Months Ended				Six Months Ended
			June 30,				June 30,
(in thousands, except per share amounts)			2003		2002		2003		2002
INTEREST INCOME:
Interest and fees on loans			$	20,910	$	18,342	$	40,964	$	35,911
Interest on deposits with banks				17		14		24		30
Interest on securities available for sale				8,196		10,362		17,003		20,522
Interest on investment securities:
	Taxable			39		248		97		511
	Exempt from Federal income tax			698		579		1,329		1,161
Interest on Federal funds sold				165		353		376		655
	Total Interest Income			30,025		29,898		59,793		58,790
INTEREST EXPENSE:
Interest on savings account deposits				2,829		2,943		5,469		5,727
Interest on certificates of deposit of $100,000 or more				1,039		1,325		2,097		2,710
Interest on other time deposits				3,738		4,298		7,591		8,931
Interest on borrowed funds				8,897		8,969		17,931		17,636
Interest on trust preferred securities				690		775		1,544		1,550
		Total Interest Expense		17,193		18,310		34,632		36,554
		Net Interest Income		12,832		11,588		25,161		22,236
Less provision for loan losses				1,250		1,075		1,850		1,625
		Net Interest Income After Provision for Loan Losses		11,582		10,513		23,311		20,611
NON-INTEREST INCOME:
Service charges on deposit accounts				572		552		1,119		1,068
Securities gains, net				539		983		690		1,626
Bank owned life insurance				522		432		1,031		843
Other non-interest income				905		351		1,270		683
		Total Non-Interest Income		2,538		2,318		4,110		4,220
NON-INTEREST EXPENSE:
Salaries and employee benefits				5,227		4,346		10,244		8,588
Occupancy expense, net				935		863		1,961		1,680
Equipment expense				737		601		1,427		1,145
Other non-interest expense				2,267		2,116		4,181		3,712
		Total Non-Interest Expense		9,166		7,926		17,813		15,125
Income before income tax expense				4,954		4,905		9,608		9,706
Income tax expense				1,362		1,373		2,660		2,679
		Net Income	$	3,592	$	3,532	$	6,948	$	7,027
EARNINGS PER SHARE:
Basic			$	0.35	$	0.44	$	0.67	$	0.88
Diluted				0.34		0.43		0.66		0.86
Weighted average shares outstanding:
Basic				10,395		8,025		10,396		8,018
Diluted				10,614		8,229		10,590		8,170

Yardville National Bancorp and Subsidiaries
Consolidated Statements of Condition
(Unaudited)

			June 30,						Dec. 31,
(in thousands)			2003			2002			2002
Assets:
Cash and due from banks			$	30,781		$	28,158		$	28,608
Federal funds sold				31,125			109,035			72,485
	Cash and Cash Equivalents			61,906			137,193			101,093
Interest bearing deposits with banks				25,782			4,129			2,501
Securities available for sale				806,574			795,148			820,665
Investment securities				63,796			62,904			54,690
Loans				1,332,007			1,073,070			1,195,143
	Less: Allowance for loan losses			(17,508	)		(15,098	)		(16,821	)
	Loans, net			1,314,499			1,057,972			1,178,322
Bank premises and equipment, net				11,961			11,341			12,208
Other real estate				1,651			1,257			1,048
Bank owned life insurance				41,843			32,561			40,850
Other assets				24,951			17,290			20,081
	Total Assets		$	2,352,963		$	2,119,795		$	2,231,458
Liabilities and Stockholders’ Equity:
Deposits
	Non-interest bearing		$	144,251		$	124,360		$	126,183
	Interest bearing			1,268,001			1,095,169			1,146,103
	Total Deposits			1,412,252			1,219,529			1,272,286
Borrowed funds
	Securities sold under agreements to repurchase			10,000			10,000			10,000
	Federal Home Loan Bank advances			726,000			735,004			746,000
	Obligation for Employee Stock Ownership Plan (ESOP)			955			600			400
	Other			1,033			1,221			1,311
	Total Borrowed Funds			737,988			746,825			757,711
Trust preferred securities				36,000			32,500			32,500
Other liabilities				18,515			17,174			23,022
	Total Liabilities		$	2,204,755		$	2,016,028		$	2,085,519
Stockholders’ equity:
	Common stock: no par value			89,550			54,760			89,297
	Surplus			2,205			2,205			2,205
	Undivided profits			55,189			45,432			50,633
	Treasury stock, at cost			(3,154	)		(3,030	)		(3,154	)
	Unallocated ESOP shares			(955	)		(600	)		(400	)
	Accumulated other comprehensive income			5,373			5,000			7,358
		Total Stockholders’ Equity		148,208			103,767			145,939
		Total Liabilities and Stockholders’ Equity	$	2,352,963		$	2,119,795		$	2,231,458

Financial Summary
Average Balances, Yields and Costs
(Unaudited)

			Three Months Ended								Three Months Ended
			June 30, 2003								June 30, 2002
								Average								Average
			Average					Yield /			Average					Yield /
(in thousands)			Balance			Interest		Cost			Balance			Interest		Cost
INTEREST EARNING ASSETS:
Deposits with other banks			$	5,440		$	17		1.25	%	$	3,441		$	14		1.63	%
Federal funds sold				56,975			165		1.16			88,274			353		1.60
Securities				882,475			8,933		4.05			836,157			11,189		5.35
Loans (1)				1,278,949			20,910		6.54			1,049,093			18,342		6.99
		Total interest earning assets	$	2,223,839		$	30,025		5.40	%	$	1,976,965		$	29,898		6.05	%
NON-INTEREST EARNING ASSETS:
Cash and due from banks			$	24,990							$	23,125
Allowance for loan losses				(16,871	)							(14,063	)
Premises and equipment, net				12,189								11,241
Other assets				65,421								52,022
		Total non-interest earning assets		85,729								72,325
Total assets			$	2,309,568							$	2,049,290
INTEREST BEARING LIABILITIES:
Deposits:
	Savings, money markets and interest bearing demand		$	635,619		$	2,829		1.78	%	$	464,145		$	2,943		2.54	%
	Certificates of deposit of $100,000 or more			139,178			1,039		2.99			150,262			1,325		3.53
	Other time deposits			463,099			3,738		3.23			450,143			4,298		3.82
		Total interest bearing deposits		1,237,896			7,606		2.46			1,064,550			8,566		3.22
Borrowed funds				739,026			8,897		4.82			720,415			8,969		4.98
Trust preferred securities				36,000			690		7.67			32,500			775		9.54
		Total interest bearing liabilities	$	2,012,922		$	17,193		3.42	%	$	1,817,465		$	18,310		4.03	%
NON-INTEREST BEARING LIABILITIES:
Demand deposits			$	131,603							$	116,396
Other liabilities				17,377								15,379
Stockholders’ equity				147,666								100,050
		Total non-interest bearing liabilities and stockholders’ equity	$	296,646							$	231,825
Total liabilities and stockholders’ equity			$	2,309,568							$	2,049,290
Interest rate spread (2)									1.98	%							2.02	%
Net interest income and margin (3)						$	12,832		2.31	%				$	11,588		2.34	%
Net interest income and margin (tax equivalent basis)(4)						$	13,196		2.37	%				$	11,906		2.41	%

(1)	Loan origination fees are considered an adjustment to interest income. For the purpose of calculating loan yields, average loan balances include nonaccrual loans with no related interest income.
(2)	The interest rate spread is the difference between the average yield on interest earning assets and the average rate paid on interest bearing liabilities.
(3)	The net interest margin is equal to net interest income divided by average interest earning assets.
(4)	In order to present pre-tax income and resultant yields on tax exempt investments and loans on a basis comparable to those on taxable investments and loans, a tax equivalent adjustment is made to interest income. The tax equivalent adjustment has been computed using a Federal income tax rate of 34 % and has the effect of increasing interest income by $364,000 and $318,000 for the three month periods ended June 30, 2003 and 2002, respectively.

Financial Summary
Average Balances, Yields and Costs
(Unaudited)

			Six Months Ended								Six Months Ended
			June 30, 2003								June 30, 2002
								Average								Average
			Average					Yield /			Average					Yield /
(in thousands)			Balance			Interest		Cost			Balance			Interest		Cost
INTEREST EARNING ASSETS:
Deposits with other banks			$	3,417		$	24		1.40	%	$	3,039		$	30		1.97	%
Federal funds sold				65,788			376		1.14			81,104			655		1.62
Securities				891,612			18,429		4.13			823,437			22,194		5.39
Loans (1)				1,247,927			40,964		6.57			1,033,614			35,911		6.95
		Total interest earning assets	$	2,208,744		$	59,793		5.41	%	$	1,941,194		$	58,790		6.06	%
NON-INTEREST EARNING ASSETS:
Cash and due from banks			$	24,290							$	22,682
Allowance for loan losses				(16,676	)							(13,799	)
Premises and equipment, net				12,171								11,137
Other assets				63,751								51,354
		Total non-interest earning assets		83,536								71,374
Total assets			$	2,292,280							$	2,012,568
INTEREST BEARING LIABILITIES:
Deposits:
	Savings, money markets and interest bearing demand		$	603,623		$	5,469		1.81	%	$	444,458		$	5,727		2.58	%
	Certificates of deposit of $100,000 or more			138,418			2,097		3.03			149,576			2,710		3.62
	Other time deposits			464,527			7,591		3.27			446,510			8,931		4.00
		Total interest bearing deposits		1,206,568			15,157		2.51			1,040,544			17,368		3.34
Borrowed funds				748,132			17,931		4.79			714,465			17,636		4.94
Trust preferred securities				37,135			1,544		8.32			32,500			1,550		9.54
		Total interest bearing liabilities	$	1,991,835		$	34,632		3.48	%	$	1,787,509		$	36,554		4.09	%
NON-INTEREST BEARING LIABILITIES:
Demand deposits			$	125,973							$	112,985
Other liabilities				27,509								14,575
Stockholders’ equity				146,963								97,499
		Total non-interest bearing liabilities and stockholders’ equity	$	300,445							$	225,059
Total liabilities and stockholders’ equity			$	2,292,280							$	2,012,568
Interest rate spread (2)									1.93	%							1.97	%
Net interest income and margin (3)						$	25,161		2.28	%				$	22,236		2.29	%
Net interest income and margin (tax equivalent basis)(4)						$	25,861		2.34	%				$	22,852		2.35	%

(1)	Loan origination fees are considered an adjustment to interest income. For the purpose of calculating loan yields, average loan balances include nonaccrual loans with no related interest income.
(2)	The interest rate spread is the difference between the average yield on interest earning assets and the average rate paid on interest bearing liabilities.
(3)	The net interest margin is equal to net interest income divided by average interest earning assets.
(4)	In order to present pre-tax income and resultant yields on tax exempt investments and loans on a basis comparable to those on taxable investments and loans, a tax equivalent adjustment is made to interest income. The tax equivalent adjustment has been computed using a Federal income tax rate of 34 % and has the effect of increasing interest income by $700,000 and $616,000 for the six month periods ended June 30, 2003 and 2002, respectively.

-----END PRIVACY-ENHANCED MESSAGE-----

EX-99.1

exv99w1