Attached files
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| 8-K - Reliance Bancshares, Inc. | earnings_8k.htm |
Earnings
Release
RELIANCE
BANCSHARES, INC. ANNOUNCES FOURTH QUARTER AND YEAR-END 2009 RESULTS
ST. LOUIS, FEBRUARY 25, 2010 –
Reliance Bancshares, Inc., the
parent company of Reliance Bank and Reliance Bank, FSB, announces its fourth
quarter, 2009 results and reports a net loss of $ 15.3 million, with
year-to-date net loss of $29.357 million. The Company’s financial
results were driven largely by the unprecedented challenges caused not only by
the overall general economy, but specifically the augmented stresses related to
the commercial real estate sector in the Florida and St. Louis metropolitan
markets. The Company proactively implemented elevated standards of
credit management including stringent asset review and risk management processes
and as a result, increased its reserve for possible loan losses to $32.222
million, a $17.916 million increase over year-end 2008. This reserve
represents 2.82% of outstanding loans; for year-end 2008, the reserve
represented 1.14% of outstanding loans. The fourth quarter, 2009
provision for possible loan losses was $25.750 million compared to the prior
year quarter of $2.609 million. Year-to-date, the provision totaled
$53.450 million, a $42.302 million increase over year-end 2008. The
greater provision was the primary cause for the reduction in
earnings. In addition, increases of $1.833 million in FDIC
assessments and $4.580 million in expenses associated with other real estate
impacted earnings for the twelve months ended December 31, 2009.
The
Company continues to achieve cost savings in salaries and employee benefits,
advertising and other non-interest expenses. These cost savings were
implemented by management in the first quarter, 2009. As a result,
fourth quarter, 2009 reductions compared to the prior year’s quarter includes
salaries and employee benefits of $.055 million, advertising costs of $.047
million and occupancy and equipment expense of $.202
million. Compared to the prior year, for the twelve months ended
December 31, 2009, salaries and employee benefits, occupancy and equipment, and
advertising costs are down $2.047 million, $.246 million and $.629 million,
respectively.
While net
interest income for the quarter ended December 31, 2009, decreased slightly by
$.465 million, or 4.7%, compared to the prior year’s quarter, for the twelve
months ended December 31, 2009, net interest income increased $1.090 million
compared to the same period in 2008. The year over year growth in net
interest income resulted from improved loan pricing, a 3% increase in total
deposits, improved total deposit mix with a 21% increase in non-interest bearing
deposits which lowered the average cost of funds, an 80% reduction in short-term
borrowings, a 24% reduction in long-term borrowings and re-pricing
opportunities.
Total
assets as of December 31, 2009 were $1.5 billion. This represents a
2.4% decrease compared to December 31, 2008. Loans decreased 9.1% or
$113.7 million for the twelve month period ended December 31,
2009. Management remains diligent as it focuses on loan quality and
its efforts to achieve profitability.
During
the fourth quarter of 2009, net charge-offs were $19.8
million. Non-performing loans totaled 6.3% of outstanding loans as of
December 31, 2009, compared to the prior year of 2.8%. The increase
in the provision for loan losses was due to additional reserves needed to
shore-up credits that have been identified by management to have deteriorated
and provide for uncertainty in the current economy. While we continue
to be burdened by an unfavorable Florida real estate market, deterioration in
the St. Louis real estate market has increased significantly.
Of the
Company’s $1.1 billion loans outstanding at December 31, 2009, 7.1% were
originated in Florida and 92.9% outside of Florida. However, as a
percent, loans originated outside of Florida continue to account for a smaller
portion of the non-performing loans and assets of the Company.
|
Originated
In
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|||
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Florida
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All other
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Total
|
|
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Net
charge-offs (year-to-date 12/31/2009)
|
$23.0
million
|
$12.5
million
|
$35.5
million
|
|
Net
charge-offs (year-to-date 12/31/2008)
|
$5.6
million
|
$0.9
million
|
$6.5
million
|
|
Net
charge-offs (quarter ended 12/31/2009)
|
$10.6
million
|
$9.2
million
|
$19.8
million
|
|
Net
charge-offs (quarter ended 12/31/2008)
|
$0.6
million
|
$0.1
million
|
$0.7
million
|
|
Non-performing
Loans (12/31/2009)
|
$25.4
million
|
$46.7
million
|
$72.1
million
|
|
Non-performing
Loans (9/30/2009)
|
$46.0
million
|
$44.5
million
|
$90.5
million
|
|
Non-performing
Loans (12/31/2008)
|
$30.1
million
|
$4.8
million
|
$34.9
million
|
|
Non-performing
Assets* (12/31/2009)
|
$44.5
million
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$56.7
million
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$101.2
million
|
|
Non-performing
Assets* (9/30/2009)
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$52.0
million
|
$53.8
million
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$105.8
million
|
|
Non-performing
Assets* (12/31/2008)
|
$37.5
million
|
$12.7
million
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$50.2
million
|
|
Outstanding
Loans Originated In
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|||
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Respective
Markets
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$80.8
million
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$1,060
million
|
$1,141
million
|
*
Non-performing Assets are comprised of Non-performing Loans and
Other
Real
Estate Owned
Total
revenue, defined as total interest income and non-interest income, was $19.650
million for the quarter ended December 31, 2009. This represents a
7.6% decrease compared to the same quarter end, 2008. Net interest
income for the same period decreased 4.7% or $.465 million to $9.495
million. In the twelve months ended December 31, 2009, net interest
income increased $1.090 million to $37.6 million, compared to the same period,
prior year, the result of reduced interest paid on deposits.
Total
deposits increased $38.0 million, or 3%, to $1.266 billion for the twelve month
period ended December 31, 2009. This increase consisted of a 21%
increase in non-interest bearing deposits of $12.455 million, and a 2.2%
increase of $25.559 million, in interest bearing deposits. During
2009, the Company launched four campaigns– in February, general branding; in
September and October, a savings and certificate of deposit
campaign. In addition, in April, Reliance Bank, Missouri, celebrated
its tenth anniversary with a customer appreciation campaign.
Jerry S.
Von Rohr, Chairman and Chief Executive Officer of Reliance Bancshares, Inc.
said, “2009 was a challenging and extremely difficult year for the financial
industry, Reliance included, and the consequences of the national recession
placed tremendous strains on our franchise. Throughout 2009, as economic
influences unfolded, executive management proactively implemented, retooled and
improved upon risk management standards to further mitigate deteriorating asset
quality. Although our fiscal loss was the result of problem assets,
we did achieve improvements in our operational efficiencies, net interest
margin, liquidity and deposit market share. However, and certainly
foremost, we remain committed to our shareholders, customers and employees and
are working diligently to preserve asset quality and capital.”
About
Reliance Bancshares, Inc.
Reliance
Bancshares, Inc., headquartered in St. Louis, MO, is a publicly held Missouri
bank holding company that provides a full range of banking services to
individual and corporate customers. The Company’s common stock is
quoted on the Pink Sheets (www.pinksheets.com)
under the symbol “RLBS”. It currently operates 20 branches in
the St. Louis metropolitan area under the name of Reliance Bank and two Loan
Production Offices – one in Chandler, Arizona and another in Houston,
Texas. It also owns and operates Reliance Bank, FSB, which is located
in Fort Myers, Florida, with three branches in the Southwest Florida
area. The company’s total assets as of December 31, 2009 exceeded
$1.5 Billion. Reliance Bank’s website can be found at www.reliancebankstl.com
Forward looking
statements
This news
release may include forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. When used in this news
release, the words “anticipates,” “expects,” intends” and similar expressions as
they relate to Reliance Bancshares, its operations or its management are
intended to identify such forward-looking statements. These
forward-looking statements are subject to numerous risks and
uncertainties. There are important factors that could cause actual
results to differ materially from those in forward-looking statements, certain
of which are beyond our control. These factors, risks and
uncertainties are discussed in our most recent Annual Report on Form 10-K filed
with the SEC, as updated from time to time in our other SEC
filings.
Contact:
Reliance
Bancshares, Inc.
Investor
Relations
Sue
Freed, Sr. Vice President
314-569-7208
sfreed@reliancebankstl.com
|
December
31,
|
December
31,
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|||
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BALANCE
SHEETS
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2009
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2008
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||
|
ASSETS
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||||
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Cash
and due from banks
|
$11,929
|
$14,367
|
||
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Short-term
investments
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15,768
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43,379
|
||
|
Debt
and equity investments
|
284,120
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193,888
|
||
|
Loans
|
1,140,797
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1,254,496
|
||
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Less
reserve for loan losses
|
(32,222)
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(14,306)
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||
|
Net
loans
|
1,108,575
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1,240,190
|
||
|
Premises
and equipment, net
|
42,211
|
44,143
|
||
|
Goodwill
and identifiable
intangible assets
|
1,286
|
1,303
|
||
|
Other
real estate owned
|
29,086
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15,289
|
||
|
Other
assets
|
43,733
|
21,430
|
||
|
Total
assets
|
$1,536,708
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$1,573,989
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||
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LIABILITIES
& EQUITY
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||||
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Noninterest
bearing deposits
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$71,830
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$59,375
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||
|
Interest
bearing deposits
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1,194,231
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1,168,672
|
||
|
Total
deposits
|
1,266,061
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1,228,047
|
||
|
Short-term
borrowings
|
12,697
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63,919
|
||
|
Long-term
FHLB borrowings
|
104,000
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136,000
|
||
|
Other
liabilities
|
4,281
|
6,414
|
||
|
Total
liabilities
|
1,387,039
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1,434,380
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||
|
Stockholders’
equity
|
149,669
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139,609
|
||
|
Total
liabilities & equity
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$1,536,708
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$1,573,989
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|
For
the Twelve
|
For
the Twelve
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For
the Quarter
|
For
the Quarter
|
|
|
months
Ended
|
months
Ended
|
Ended
|
Ended
|
|
|
INCOME
STATEMENTS
|
Dec
31, 2009
|
Dec
31, 2008
|
Dec
31, 2009
|
Dec.
31, 2008
|
|
Total
interest income
|
$76,589
|
$78,209
|
$18,437
|
$20,832
|
|
Total
interest expense
|
39,005
|
41,715
|
8,942
|
10,872
|
|
Net
interest income
|
37,584
|
36,494
|
9,495
|
9,960
|
|
Provision
for loan losses
|
53,450
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11,148
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25,750
|
2,609
|
|
Net
after provision
|
(15,866)
|
25,346
|
(16,255)
|
7,351
|
|
NONINTEREST
INCOME
|
||||
|
Service
charges on deposits
|
976
|
797
|
262
|
214
|
|
Gain
(loss) sale of securities
|
1,347
|
321
|
540
|
9
|
|
Other
income
|
1,603
|
1,565
|
411
|
212
|
|
Total
noninterest income
|
3,926
|
2,683
|
1,213
|
435
|
|
NONINTEREST
EXPENSE
|
||||
|
Salaries
and benefits
|
13,868
|
15,915
|
3,232
|
3,287
|
|
Other
real estate expense
|
6,163
|
1,583
|
2,334
|
675
|
|
Occupancy
and equipment
|
4,257
|
4,503
|
925
|
1,127
|
|
FDIC
assessment
|
2,745
|
912
|
409
|
243
|
|
Data
processing
|
1,950
|
1,881
|
451
|
522
|
|
Advertising
|
149
|
778
|
(60)
|
(13)
|
|
Other
|
4,915
|
3,856
|
2,089
|
936
|
|
Total
noninterest expense
|
34,047
|
29,428
|
9,380
|
6,777
|
|
Income
before taxes
|
(45,987)
|
(1,399)
|
(24,422)
|
1,009
|
|
Income
taxes
|
(16,630)
|
(1,080)
|
(9,122)
|
119
|
|
Net
income
|
-$29,357
|
-$319
|
-$15,300
|
$890
|