Attached files
| file | filename |
|---|---|
| 8-K - Santa Lucia Bancorp | v209929_8k.htm |
EX-99.1 2
newsrelease.htm PRESS RELEASE
EXHIBIT
99.1
Santa
Lucia Bancorp Reports Q4 2010 Financial Results
ATASCADERO,
Calif., February 10, 2011 Santa Lucia Bancorp (the "Company") (OTC Bulletin
Board: SLBA.OB), the parent company of Santa Lucia Bank (the "Bank"), today
reported a net loss of $1.2 million for the fourth quarter of 2010 compared to a
net loss of $4.6 million for the third quarter of 2010 and a net loss of $2.4
million for the fourth quarter a year ago. For the year ended December 31, 2010,
the Company reported a net loss of $14.8 million compared to a net loss of $1.8
million for the same period in 2009. The net loss for the fourth quarter of 2010
was primarily attributable to a $1.7 million provision for loan losses, recorded
in conjunction with $467 thousand of quarterly net charge-offs. Provisions for
loan losses was $15.2 million for the year ended December 31, 2010 compared to
$5.5 million for the same period for 2009. The Allowance for Loan and Lease
Losses (the “ALLL”) was $11.0 million, $9.7 million and $3.4 million at December
31, 2010, September 30, 2010 and December 31, 2009, respectively. As a percent
of total gross loans, the ALLL was 5.84%, 4.95% and 1.67% at December 31, 2010,
September 30, 2010 and December 31, 2009, respectively.
The net
loss applicable to common shareholders was $1.3 million or $0.63 per diluted
common share and $2.5 million or $1.27 per diluted common share for the quarters
ended December 31, 2010 and the same period in 2009, respectively. For the year
ended December 31, 2010, the net loss applicable to common shareholders was
$15.0 million or $7.49 per common diluted share compared to a net loss of $2.0
million or $1.05 per common diluted share for the same period in 2009. Income
(loss) applicable to common shareholders is calculated by subtracting dividends
accrued and discount accreted on preferred stock from net income
(loss).
According
to John C. Hansen, President and Chief Executive Officer, “While it is still not
a pleasant task to report a loss for the fourth quarter and full year 2010, the
encouraging message is that quarterly losses on a linked quarter basis decreased
by over $3.4 million driven primarily by lower provisions for loan losses of
$3.0 million. The Bank has spent a great deal of time and effort during 2010 to
identify problem credits. This was apparent by high levels of provisioning for
loan losses and total net charge offs during the first three quarters of 2010
that in the aggregate amounted to $13.4 million and $7.1 million, respectively.”
He added, “On a linked quarter basis, non-performing loans decreased from $26.8
million to $26.1 million or by $.7 million. On a linked quarter basis, OREO
increased by $.5 million as the net result of selling two properties in the
aggregate for $1.1 million and the migration from non-performing loans to OREO
of three properties totaling $1.6 million. We have been diligent in our efforts
to move OREO properties as is evidenced by these transactions.” Mr. Hansen went
on to say, “We have had a series of independent third party and regulatory
examinations and reviews of our loan portfolio that have confirmed we are
identifying credits with inherent and obvious weakness in an appropriate manner.
We are cautiously optimistic to see evidence of a positive trend in regard to
quarterly loan loss provisioning, net charge offs and non-performing loan
levels.”
Mr.
Hansen reported, “Compared to the prior year, total assets decreased by $20.1
million or 7.5% to $249.8 million; net loans decreased by $21.3 million or 10.8%
to $176.8 million; and total deposits decreased by $4.9 million or 2.0% to
$233.9 million. Most of the decrease in deposits is reflected in the reduced
balances in time deposits. With outstanding loan balances on the decline, the
Bank took advantage of the opportunity to reduce interest expense on higher cost
deposits. Core deposits as a percentage of total deposits remained static at
78.1% and 78.2% at December 31, 2010 and 2009, respectively. The Bank defines
core deposits as total deposits less time deposits greater than $100 thousand.
The Bank implemented certain initiatives to enhance its capital ratios during
the fourth quarter of 2010 that included strategies to reduce total assets as is
evidenced by the linked quarter decrease of $14.9 million from $264.7 million at
September 30, 2010.” He went on to say, “At December 31, 2010, the Bank is
considered “adequately capitalized” in accordance with regulatory guidelines.
The Bank is considering alternatives to enhance its capital ratios, including
strategies to continue to reshape the balance sheet, initiatives to improve core
operating earnings, and strategies to raise additional capital and other
strategic alternatives.”
Mr.
Hansen went on to say, “The liquidity ratio of 23.0% remains strong at December
31, 2010 compared to 23.2% at September 30, 2010, and 20.9% at December 31,
2010. Our customer base continues to be very loyal and reflective of the
relationship building that has been a part of our culture for
decades.”
On
December 23, 2010, the Company and the Bank and the Federal Reserve Bank of San
Francisco (“FRBSF”) entered into a Written Agreement (the “Written Agreement”),
addressing, among other items, management, operations, lending, asset quality
and increased capital for the Bank and the Company, as appropriate.
As
previously disclosed in an 8-K filed with the SEC on December 29, 2010, the
Written Agreement was the result of a recent examination of the Bank and the
Company by the FRBSF that resulted in certain criticisms of the Bank,
particularly related to the overall quality of the Bank’s loan
portfolio. Many of the requirements of the Written Agreement reflect
recommendations or requirements from the Report of Examination that the Bank has
been working on since the date of the examination. Subsequent to the
examination and in order to enhance the Bank’s ability to remedy many of the
noted criticisms, the Bank made numerous changes in the executive structure to
include a newly appointed Chief Credit Officer (CCO) and Chief Financial
Officer. In addition, Stanley R. Cherry, Director and former President/CEO has
rejoined the Bank as a senior credit administrator and will be working closely
with the CCO to manage the day-to-day credit functions. The Company and Bank
will continue their efforts to comply with all provisions of the Written
Agreement, and believe they are taking the appropriate steps necessary to comply
in a timely fashion.
THE
COMPANY AND ITS BUSINESS STRATEGY:
Santa
Lucia Bancorp (the “Company”), headquartered in Atascadero, California is a
California Corporation organized in 2006 to act as the holding company for Santa
Lucia Bank (the “Bank”). Santa Lucia Bank has operated in the State of
California since August 5, 1985.
The Bank
engages in the commercial banking business principally in San Luis Obispo and
northern Santa Barbara Counties from its banking offices located at 7480 El
Camino Real, Atascadero, California, 1240 Spring Street, Paso Robles,
California, 1530 East Grand Avenue, Arroyo Grande, California and 1825 South
Broadway, Santa Maria, California.
The
Company, through its subsidiary, Santa Lucia Bank, emphasizes personalized
quality customer service to small and medium sized businesses in its
markets. The main focus after 25 years of operation is to provide a
consistent return to shareholders, quality personalized service to our customers
and a challenging and rewarding environment for our employees. These
guiding principals will continue to serve the company well in both the short
term and long term.
Statements concerning future
performance, developments or events, credit quality, expectations for growth and
income forecasts, and any other guidance on future periods, constitute
forward-looking statements that are subject to a number of risks and
uncertainties. Actual results may differ materially from stated
expectations. Specific factors include, but are not limited
to, the current
economic downturn and turmoil in financial markets and the response of federal
and state regulators thereto; the imposition of limitations on our operations by
bank regulators as a result of examinations of our condition; our ability to
comply satisfactorily with the enforcement action to which we are subject; the
effect of changing regional and national economic conditions; significant
changes in interest rates and prepayment speeds; credit risks of lending and
investment activities; changes in federal and state banking laws or regulations;
competitive pressure in the banking industry; changes in governmental fiscal or
monetary policies; uncertainty regarding the economic outlook resulting from the
continuing war on terrorism, as well as actions taken or to be taken by the U.S.
or other governments as a result of further acts or threats of terrorism; and
other factors discussed in Item 1A. Risk Factors of the company’s 2009 Annual
Report as filed on Form 10-K and the Company’s 10Q for the quarter ended
September 30, 2010, filed with the SEC on November 15, 2010. Additional information on these and
other factors that could affect financial results are included in the Company’s
Securities and Exchange Commission filings.
When
used in this release, the words or phrases such as “will likely result in”,
“management expects that”, “will continue”, “is anticipated”, “estimate”,
“projected”, or similar expressions are intended to identify “forward-looking
statements” within the meaning of the Private Securities Litigation Reform Act
of 1995 (PSLRA). Readers should not place undue reliance on the
forward-looking statements, which reflect management’s view only as of the date
hereof. Santa Lucia Bancorp undertakes no obligation to publicly revise
these forward-looking statements to reflect subsequent events or
circumstances. This statement is included for the express purpose of
protecting Santa Lucia Bancorp under PSLRA’s safe harbor
provisions.
|
Year
Ended December 31,
|
||||||||||||||||||||
|
2010
|
2009
|
2008
|
2007
|
2006
|
||||||||||||||||
|
Summary
of Operations:
|
(dollars
in thousands except per share data)
|
|||||||||||||||||||
|
Interest
Income
|
$ | 12,587 | $ | 13,851 | $ | 15,276 | $ | 17,719 | $ | 17,027 | ||||||||||
|
Interest
Expense
|
2,291 | 3,021 | 3,877 | 4,824 | 3,577 | |||||||||||||||
|
Net
Interest Income
|
10,296 | 10,830 | 11,399 | 12,895 | 13,450 | |||||||||||||||
|
Provision
for Loan Loss
|
15,198 | 5,460 | 975 | - | 240 | |||||||||||||||
|
Net
Interest Income After Provision for Loan Losses
|
(4,902 | ) | 5,370 | 10,424 | 12,895 | 13,210 | ||||||||||||||
|
Noninterest
Income
|
1,610 | 1,236 | 1,111 | 1,071 | 1,010 | |||||||||||||||
|
Noninterest
Expense
|
10,655 | 9,865 | 9,763 | 9,029 | 8,590 | |||||||||||||||
|
Income
Before Income Taxes
|
(13,947 | ) | (3,259 | ) | 1,772 | 4,937 | 5,630 | |||||||||||||
|
Income
Taxes Benefit/(Expense)
|
(807 | ) | 1,434 | 633 | 1,934 | 2,242 | ||||||||||||||
|
Net
Income (loss)
|
$ | (14,754 | ) | $ | (1,825 | ) | $ | 1,139 | $ | 3,003 | $ | 3,388 | ||||||||
|
|
||||||||||||||||||||
|
Dividends
and Accretion on Preferred Stock
|
$ | 240 | $ | 221 | $ | - | $ | - | $ | - | ||||||||||
|
|
||||||||||||||||||||
|
Net
earnings (losses) Applicable to Common Shareholders
|
$ | (14,994 | ) | $ | (2,046 | ) | $ | 1,139 | $ | 3,003 | $ | 3,388 | ||||||||
|
Cash
Dividends Paid
|
$ | - | $ | 483 | $ | 963 | $ | 871 | $ | 768 | ||||||||||
|
Per
Common Share Data:
|
||||||||||||||||||||
|
Net
Income - Basic
|
$ | (7.49 | ) | $ | (1.05 | ) | $ | 0.59 | $ | 1.55 | $ | 1.77 | ||||||||
|
Net
Income - Diluted
|
$ | (7.49 | ) | $ | (1.05 | ) | $ | 0.58 | $ | 1.51 | $ | 1.68 | ||||||||
|
Dividends
|
$ | - | $ | 0.25 | $ | 0.50 | $ | 0.45 | $ | 0.40 | ||||||||||
|
Book
Value
|
$ | 1.86 | $ | 9.58 | $ | 11.21 | $ | 11.01 | $ | 9.93 | ||||||||||
|
Common
Outstanding Shares:
|
2,003,131 | 1,961,334 | 1,923,053 | 1,924,873 | 1,928,097 | |||||||||||||||
|
Statement
of Financial Condition Summary:
|
||||||||||||||||||||
|
Total
Assets
|
$ | 249,801 | $ | 269,923 | $ | 251,880 | $ | 248,640 | $ | 240,738 | ||||||||||
|
Total
Deposits
|
233,867 | 238,723 | 212,317 | 212,718 | 212,988 | |||||||||||||||
|
Total
Net Loans
|
176,750 | 198,099 | 186,632 | 166,619 | 169,680 | |||||||||||||||
|
Allowance
for Loan Losses
|
10,999 | 3,386 | 2,310 | 1,673 | 1,654 | |||||||||||||||
|
Total
Shareholders' Equity
|
7,545 | 23,030 | 25,551 | 21,189 | 19,137 | |||||||||||||||
|
Asset
Quality:
|
||||||||||||||||||||
|
Loans
on Non-Accrual
|
$ | 23,945 | $ | 6,407 | $ | 1,614 | $ | 2,176 | $ | - | ||||||||||
|
Loans
Past Due >90 days and still accruing
|
$ | - | $ | - | $ | - | $ | - | $ | 550 | ||||||||||
|
OREO
|
$ | 2,123 | $ | 428 | $ | - | $ | - | $ | - | ||||||||||
|
Loans
Past Due 30-89 days
|
$ | 606 | $ | 5 | $ | 2,674 | $ | - | $ | - | ||||||||||
|
Selected
Ratios:
|
||||||||||||||||||||
|
Return
on Average Assets
|
-5.65 | % | -0.69 | % | 0.46 | % | 1.22 | % | 1.42 | % | ||||||||||
|
Return
on Average Equity
|
-107.53 | % | -7.18 | % | 5.19 | % | 14.87 | % | 19.45 | % | ||||||||||
|
Net
Interest Margin
|
4.16 | % | 4.49 | % | 5.05 | % | 5.92 | % | 6.38 | % | ||||||||||
|
Average
Loans as a Percentage of Average Deposits
|
82.46 | % | 87.82 | % | 83.84 | % | 76.11 | % | 79.74 | % | ||||||||||
|
Allowance
for Loan Losses to Total Loans
|
5.84 | % | 1.67 | % | 1.22 | % | 0.99 | % | 0.96 | % | ||||||||||
|
Company
|
||||||||||||||||||||
|
Tier
I Capital to Average Assets
|
4.02 | % | 10.28 | % | 11.89 | % | 10.50 | % | 10.00 | % | ||||||||||
|
Tier
I Capital to Risk-Weighted Assets -
|
5.72 | % | 12.54 | % | 14.41 | % | 13.20 | % | 12.70 | % | ||||||||||
|
Total
Capital to Risk-Weighted Assets -
|
8.30 | % | 13.87 | % | 15.92 | % | 14.60 | % | 14.40 | % | ||||||||||
|
Bank
|
||||||||||||||||||||
|
Tier
I Capital to Average Assets
|
4.75 | % | 9.71 | % | 11.44 | % | 9.85 | % | 9.11 | % | ||||||||||
|
Tier
I Capital to Risk-Weighted Assets -
|
6.85 | % | 11.85 | % | 13.65 | % | 12.33 | % | 11.43 | % | ||||||||||
|
Total
Capital to Risk-Weighted Assets -
|
8.16 | % | 13.18 | % | 15.17 | % | 13.80 | % | 13.13 | % | ||||||||||