Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K EARNINGS - First Sentry Bancshares, Inc. | form8k_earn-120910.htm |
Dear Customers, Stockholders and Friends:
Please find enclosed the unaudited financial statements as of September 30, 2010 and for the nine month period ended September 30, 2010.
We are pleased to report total deposits increased $19.7 million from September 30, 2009 to September 30, 2010 as total deposits stood at a record quarterly high of $410.1 million on September 30, 2010. Because of limited opportunities to employ these funds in the form of loans due to decreased loan demand, combined with the fact that investing in securities during a time of record low interest rates provided little advantage, we utilized these funds to reduce other liabilities, which consisted mostly of advances from the Federal Home Loan Bank, by $18.1 million. This strategy had the combination of reducing the Bank’s interest expense while also limiting the Bank’s asset growth. This is evidenced in that total assets amounted to $494.7 million on September 30, 2010 versus $493.1 million on September 30, 2009.
On September 30, 2010, total stockholders’ equity amounted to $29.5 million. This equates to a book value per share of $20.52 and is consistent with the $20.51 book value per share on September 30, 2009. Despite the negligible growth in book value per share, we remain very encouraged as the September 30, 2010 book value per share takes into consideration two significant events that occurred over this time horizon: 1) Dividends paid to shareholders between October 1, 2009 and September 30, 2010 amounted to over $1.15 million – the highest amount paid in any previous 12 month period, and 2) The allowance for loan losses increased $1.2 million adding considerable stability to the balance sheet. At September 30, 2010, this allowance stood at 1.38% of total loans versus 1.05% on September 30, 2009.
We are pleased to report that the quarter ended September 30, 2010 marked the thirty-second consecutive quarter that Your Bank has paid dividends to its shareholders. Total dividends paid by the Company now amounts to almost $4.8 million.
Your Bank generated a net income of $2.06 million for the nine month period ended September 30, 2010 compared to $1.09 million for the nine month period ended September 30, 2009. This net income improvement of $975 thousand, or 89.5%, was a result of: 1) a $4.6 million increase in net interest income – partially bolstered by the reduction in other liabilities as mentioned above, and 2) a $1.4 million increase in non-interest income, inclusive of a $1.1 million improvement from the sale of securities. These improvements more than offset the incurrence of an additional $2.45 million increase in operating costs during the nine month period ended September 30, 2010. These increased operating costs in 2010 were primarily the result of the inclusion of costs associated with the Guaranty Bank merger (increased personnel, increased data processing expense, increased occupancy costs due to having three additional locations, etc.) that were not fully included in the statement for the nine months ended September 30, 2009 as the merger became effective September 25, 2009.
In addition, this net income improvement was realized despite the Bank increasing by $2.1 million its loan loss provision in the nine month period ended September 30, 2010. As mentioned in previous quarterly reports, we are navigating Your Bank in an uncertain economic environment, and the providing of this additional amount is considered prudent to absorb the risks in the Bank’s loan portfolio. As we move through the final quarter of 2010 and considering the effects that the economy may have on the Bank and its customers, we will continue to position the Bank in a manner to absorb risks, while still retaining the capability of posting record profits.
As always, thanks so much to our shareholders and customers for enabling us to achieve the results stated herein. We always appreciate your business, your referrals, and your support! In this economic and regulatory environment, we need to all work together to achieve continued success.
Should you have any questions about Your Bank or about this report, please do not hesitate to call.
Sincerely,
/s/ Robert H. Beymer
Robert H. Beymer
Chairman of the Board
/s/ Geoffrey S. Sheils
Geoffrey S. Sheils
President & CEO
|
First Sentry Bancshares, Inc.
|
||||||||||||
|
Balance Sheet
|
||||||||||||
|
September 30, 2010 and 2009
|
||||||||||||
|
(DOLLARS IN THOUSANDS - except per share data)
|
||||||||||||
|
(unaudited)
|
||||||||||||
|
9/30/10
|
9/30/09
|
|||||||||||
|
Cash and Fed Funds Sold
|
$ | 26,393 | $ | 8,154 | ||||||||
|
Investment Securities
|
95,812 | 115,950 | ||||||||||
|
Loans
|
359,495 | 356,401 | ||||||||||
|
Less: Allowance for Loan Losses
|
4,960 | 3,740 | ||||||||||
|
Net Loans
|
354,535 | 352,661 | ||||||||||
|
Bank Premises and Equipment
|
6,769 | 6,934 | ||||||||||
|
Intangible Assets
|
2,856 | 1,904 | ||||||||||
|
Other Assets
|
8,291 | 7,462 | ||||||||||
|
Total Assets
|
$ | 494,656 | $ | 493,065 | ||||||||
|
DEPOSITS
|
||||||||||||
|
Demand
|
$ | 55,651 | $ | 54,123 | ||||||||
|
Savings
|
134,384 | 114,955 | ||||||||||
|
Other Time Deposits
|
220,062 | 221,344 | ||||||||||
|
Total Deposits
|
410,097 | 390,422 | ||||||||||
|
Other Liabilities
|
46,062 | 64,157 | ||||||||||
|
|
||||||||||||
|
Total Liabilities
|
456,159 | 454,579 | ||||||||||
|
Trust Preferred Securities
|
9,000 | 9,000 | ||||||||||
|
Common Stock, $1 par value,
|
||||||||||||
|
5,280,000 authorized,
|
||||||||||||
|
1,056,000 issued
|
1,438 | 1,438 | ||||||||||
|
Additional Paid-in Capital
|
15,294 | 15,277 | ||||||||||
|
Retained Earnings
|
12,458 | 11,906 | ||||||||||
|
Unrealized Gain (Loss) on Investments
|
307 | 865 | ||||||||||
|
Total Stockholders’ Equity
|
29,497 | 29,486 | ||||||||||
|
Total Liabilities & Stockholders’ Equity
|
$ | 494,656 | $ | 493,065 | ||||||||
|
Book Value per Share
|
$ | 20.52 | $ | 20.51 | ||||||||
|
First Sentry Bancshares, Inc.
|
||||||||
|
Statement of Income
|
||||||||
|
For the Nine Months Ended
|
||||||||
|
September 30, 2010 and 2009
|
||||||||
|
(DOLLARS IN THOUSANDS - except per share data)
|
||||||||
|
(unaudited)
|
||||||||
|
Through
|
Through
|
|
||||||
|
Interest Income
|
9/30/10
|
9/30/09 |
|
|||||
|
Loans, Including Fees
|
$ | 15,314 | $ | 10,565 | ||||
|
Investment Securities
|
2,412 | 2,883 | ||||||
|
Total Interest Income
|
17,726 | 13,448 | ||||||
|
Interest Expense
|
5,470 | 5,828 | ||||||
|
Net Interest Income
|
12,256 | 7,620 | ||||||
|
Non-Interest Income
|
||||||||
|
Service Charges
|
783 | 628 | ||||||
|
Other Charges and Fees
|
387 | 247 | ||||||
|
Total Non-Interest Income
|
1,170 | 875 | ||||||
|
Loan Loss Provision Expense
|
3,511 | 1,403 | ||||||
|
|
||||||||
|
Gross Operating Income
|
9,915 | 7,092 | ||||||
|
Non-Interest Expense
|
||||||||
|
Salaries and Employee Benefits
|
3,203 | 2,121 | ||||||
|
Equipment and Occupancy
|
874 | 455 | ||||||
|
Data Processing
|
462 | 397 | ||||||
|
Professional Fees
|
419 | 153 | ||||||
|
Insurance
|
541 | 497 | ||||||
|
Taxes, Other
|
210 | 147 | ||||||
|
Other Expenses
|
1,848 | 1,336 | ||||||
|
Total Other Expense
|
7,557 | 5,106 | ||||||
|
Securities Losses
|
659 | (440) | ||||||
|
Income before Income Tax
|
3,017 | 1,546 | ||||||
|
Income Tax Expense
|
953 | 457 | ||||||
|
Net Income
|
$ | 2,064 | $ | 1,089 | ||||
|
Nine Month’s Earnings per Share
|
$ | 1.44 | $ | 1.02 | ||||