Attached files
| file | filename |
|---|---|
| 8-K - UNITED SECURITY BANCSHARES, INC 8-K - FIRST US BANCSHARES INC | a6618481.htm |
Exhibit 99.1
United Security Bancshares, Inc. Reports 2010 Results
THOMASVILLE, Ala.--(BUSINESS WIRE)--February 18, 2011--United Security Bancshares, Inc. (Nasdaq: USBI) today reported net income attributable to USBI of $2.1 million, or $0.34 per diluted share, for the twelve months ended December 31, 2010, compared with net income attributable to USBI of $4.8 million, or $0.79 per diluted share, for the 2009 fiscal year. Net loss attributable to USBI for the fourth quarter of 2010 was ($1.2 million), or ($0.20) per diluted share, compared with a net loss attributable to USBI of ($414,000), or ($0.07) per diluted share, for the fourth quarter of 2009.
“United Security reported continued profitability in 2010, even though the continued softness in the economy resulted in higher costs associated with non-performing loans, foreclosed properties and provision for loan losses compared with 2009,” stated R. Terry Phillips, President and Chief Executive Officer of United Security Bancshares, Inc. “We remain very proactive in improving our asset quality to mitigate future losses and protect our capital base.”
Twelve Month Results
For the year ended December 31, 2010, net income attributable to USBI was $2.1 million, or $0.34 per diluted share, compared with $4.8 million, or $0.79 per diluted share, for the year ended December 31, 2009.
Net interest income rose to $34.8 million in 2010, compared with $34.3 million in 2009. The increase in net interest income was due primarily to growth in the net interest margin compared with 2009. Net interest margin rose to 5.83% in 2010, compared with 5.71% in 2009.
Provision for loan losses increased to $10.7 million in 2010, or 2.5% annualized of average loans, compared with $9.1 million, or 2.2% annualized of average loans, in 2009. Net charge-offs totaled $8.2 million in 2010, compared with $7.6 million in 2009.
Non-interest income rose 8.9% to $8.5 million in 2010, compared with $7.8 million in 2009. The increase in non-interest income was due primarily to a $4.2 million insurance settlement received in the first quarter of 2010. Non-interest income increased in 2009 from the proceeds received in the settlement of a lawsuit in the amount of $2.7 million. Also included in non-interest income is a realized loss on the sale of other real estate (OREO) in the amount of $1.7 million in 2010, compared to $635,000 in 2009.
Non-interest expense rose 13.5% to $30.4 million in 2010, compared with $26.8 million in 2009. The increase was due primarily to $3.5 million impairment in OREO in 2010, compared with $637,000 of OREO impairment in 2009.
Shareholders’ equity totaled $79.8 million, or book value of $13.27 per share, as of December 31, 2010. Return on average assets for 2010 was 0.31%, and return on average equity was 2.49%.
Fourth Quarter Results
United Security reported a net loss attributable to USBI of ($1.2 million), or ($0.20) per diluted share, for the fourth quarter of 2010, compared with a net loss attributable to USBI of ($414,000), or ($0.07) per diluted share, for the fourth quarter of 2009.
“United Security’s fourth quarter loss was due primarily to losses on the sale of OREO and write-downs in values of OREO,” stated Mr. Phillips. “Our markets remain under pressure due to the slowdown in real estate sales and declining real estate values. These factors were primary contributors to the higher OREO-related costs for the fourth quarter. We strengthened our allowance for loan losses by almost $2.7 million in the fourth quarter to account for these trends. Our focus remains on reducing the level of OREO and non-performing loans as key measures in restoring our profitability.”
Interest income totaled $11.0 million in the fourth quarter of 2010, compared with $11.8 million in the fourth quarter of 2009. The decrease in interest income was due primarily to lower interest earned on loans and securities due to a decline in average loans and securities for the quarter.
“Net loans were down 1.6% in the fourth quarter to $396.0 million at year-end 2010,” stated Mr. Phillips. “New loan demand remains weak in most of our markets, and we expect loan demand to remain soft until the economy improves and real estate values stabilize.”
Interest expense declined 25.1% to $2.2 million in the fourth quarter of 2010, compared with $2.9 million in the fourth quarter of 2009. The decline in interest expense was due primarily to lower average rates paid on interest bearing deposits. Average deposits increased 1.2% to $507.0 million, compared with $502.1 million in the fourth quarter of 2009.
Net interest income was down 0.7% to $8.8 million in the fourth quarter of 2010, compared with $8.9 million in the fourth quarter of the prior year. The decrease in net interest income was due to a decrease in average loans, partially offset by a 41 basis point increase in the net interest margin, compared with the fourth quarter of 2009. Net interest margin improved by 11 basis points to 6.12% in the fourth quarter of 2010 from the third quarter of 2010.
Provision for loan losses was $3.8 million in the fourth quarter of 2010, or 3.8% annualized of average loans, compared with $4.2 million, or 4.1% annualized of average loans, in the fourth quarter of 2009. Net charge-offs totaled $1.2 million in the fourth quarter of 2010, compared with $2.2 million in the fourth quarter of 2009. Core operations remain solid, as evidenced by our growth in net interest margin and growth in net interest income after provision for loan losses.
Total non-interest income declined $821,000 to $563,000 in the fourth quarter of 2010, compared with $1.4 million in the fourth quarter of the prior year. The decline in non-interest income was due primarily to a $582,000 other loss that included a realized $1.1 million loss on sale of OREO.
Non-interest expense increased 10.6% to $7.8 million in the fourth quarter of 2010, compared with $7.0 million in the fourth quarter of 2009. The increase was due primarily to an increase in impairment in OREO that totaled $1.7 million in the fourth quarter of 2010. These higher costs were partially offset in 2010 by a 6.3% decrease in salary and employee benefits expense to $3.2 million and a $670,000 decline in other expense to $1.9 million, both compared with 2009.
About United Security Bancshares, Inc.
United Security Bancshares, Inc. is a bank holding company that operates nineteen banking offices in Alabama through First United Security Bank. In addition, the Company’s operations include Acceptance Loan Company, Inc., a consumer loan company, and FUSB Reinsurance, Inc., an underwriter of credit life and credit accident and health insurance policies sold to the bank’s and ALC’s consumer loan customers. The Company’s stock is traded on the Nasdaq Capital Market under the symbol “USBI.”
Forward-Looking Statements
This press release contains forward-looking statements, as defined by federal securities laws. Statements contained in this press release that are not historical facts are forward-looking statements. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. USBI undertakes no obligation to update these statements following the date of this press release, except as required by law. In addition, USBI, through its senior management, may make from time to time forward-looking public statements concerning the matters described herein. Such forward-looking statements are necessarily estimates reflecting the best judgment of USBI’s senior management based upon current information and involve a number of risks and uncertainties. Certain factors that could affect the accuracy of such forward-looking statements are identified in the public filings made by USBI with the Securities and Exchange Commission, and forward-looking statements contained in this press release or in other public statements of USBI or its senior management should be considered in light of those factors. With respect to the adequacy of the allowance for loan losses for USBI, these factors include, but are not limited to, the rate of growth (or lack thereof) in the economy, the relative strength and weakness in the consumer and commercial credit sectors and in the real estate markets and collateral values. There can be no assurance that such factors or other factors will not affect the accuracy of such forward-looking statements.
|
UNITED SECURITY BANCSHARES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in Thousands, Except Per Share Data) |
|||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||
| December 31, | December 31, | ||||||||||||||
| 2010 | 2009 | 2010 | 2009 | ||||||||||||
| (Unaudited) | (Unaudited) | ||||||||||||||
| INTEREST INCOME: | |||||||||||||||
| Interest and Fees on Loans | $ | 9,486 | $ | 9,645 | $ | 38,086 | $ | 38,795 | |||||||
| Interest on Investment Securities | 1,486 | 2,111 | 6,742 | 8,679 | |||||||||||
| Total Interest Income | 10,972 | 11,756 | 44,828 | 47,474 | |||||||||||
| INTEREST EXPENSE: | |||||||||||||||
| Interest on Deposits | 1,729 | 2,066 | 7,600 | 9,581 | |||||||||||
| Interest on Borrowings | 438 | 826 | 2,473 | 3,619 | |||||||||||
| Total Interest Expense | 2,167 | 2,892 | 10,073 | 13,200 | |||||||||||
| NET INTEREST INCOME | 8,805 | 8,864 | 34,755 | 34,274 | |||||||||||
|
PROVISION FOR LOAN LOSSES |
3,847 | 4,244 | 10,658 | 9,101 | |||||||||||
|
NET INTEREST INCOME AFTER |
|||||||||||||||
|
PROVISION FOR LOAN LOSSES |
4,958 |
4,620 |
24,097 |
25,173 |
|||||||||||
| NON-INTEREST INCOME: | |||||||||||||||
|
Service and Other Charges on Deposit
Accounts |
798 |
721 |
3,061 |
2,871 |
|||||||||||
| Credit Life Insurance Income | 347 | 351 | 939 | 997 | |||||||||||
| Other (Loss) Income | (582 | ) | 312 | 4,491 | 3,927 | ||||||||||
| Total Non-Interest Income | 563 | 1,384 | 8,491 | 7,795 | |||||||||||
| NON-INTEREST EXPENSE: | |||||||||||||||
| Salaries and Employee Benefits | 3,203 | 3,419 | 13,765 | 13,594 | |||||||||||
| Occupancy Expense | 439 | 489 | 1,860 | 1,901 | |||||||||||
| Furniture and Equipment Expense | 323 | 348 | 1,260 | 1,274 | |||||||||||
| Impairment on Other Real Estate Owned | 1,895 | 192 | 3,538 | 637 | |||||||||||
| Other Expense | 1,904 | 2,574 | 10,024 | 9,410 | |||||||||||
| Total Non-Interest Expense | 7,764 | 7,022 | 30,447 | 26,816 | |||||||||||
|
(LOSS) INCOME BEFORE INCOME TAXES |
(2,243 |
) |
(1,018 |
) |
2,141 |
6,152 |
|||||||||
|
(BENEFIT FROM) PROVISION FOR INCOME TAXES |
(1,027 |
) |
(604 |
) |
194 |
1,562 |
|||||||||
| NET (LOSS) INCOME | $ | (1,216 | ) | $ | (414 | ) | $ | 1,947 | $ | 4,590 | |||||
|
Less: Net Loss Attributable to
Noncontrolling Interest |
- |
- |
(125 |
) |
(164 |
) |
|||||||||
|
NET (LOSS) INCOME ATTRIBUTABLE TO USBI |
$ |
(1,216 |
) |
$ |
(414 |
) |
$ |
2,072 |
$ |
4,754 |
|||||
| BASIC AND DILUTED NET (LOSS) | |||||||||||||||
|
INCOME ATTRIBUTABLE TO USBI
PER SHARE |
$ |
(0.20 |
) |
$ |
(0.07 |
) |
$ |
0.34 |
$ |
0.79 |
|||||
| DIVIDENDS PER SHARE | $ | 0.11 | $ | 0.11 | $ | 0.44 | $ | 0.60 | |||||||
|
UNITED SECURITY BANCSHARES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Dollars in Thousands, Except Per Share Data) |
||||||||
|
|
|
|||||||
|
December 31, |
December 31, |
|||||||
| 2010 | 2009 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Cash and Due from Banks | $ | 10,330 | $ | 12,323 | ||||
| Interest Bearing Deposits in Banks | 3,202 | 126 | ||||||
| Total Cash and Cash Equivalents | 13,532 | 12,449 | ||||||
| Federal Funds Sold | - | 4,545 | ||||||
| Investment Securities Available-for-Sale, at fair market value | 135,877 | 194,754 | ||||||
| Investment Securities Held-to-Maturity, at cost | 1,210 | 1,250 | ||||||
| Federal Home Loan Bank Stock, at cost | 5,093 | 5,700 | ||||||
|
Loans, net of allowance for loan losses of $12,463 and $10,004, respectively |
395,951 | 402,504 | ||||||
| Premises and Equipment, net | 16,609 | 17,253 | ||||||
| Cash Surrender Value of Bank-Owned Life Insurance | 12,499 | 12,037 | ||||||
| Accrued Interest Receivable | 5,110 | 5,095 | ||||||
| Goodwill | 4,098 | 4,098 | ||||||
| Investment in Limited Partnerships | 1,766 | 1,925 | ||||||
| Other Real Estate Owned | 25,632 | 21,439 | ||||||
| Other Assets | 9,616 | 8,705 | ||||||
| Total Assets | $ | 626,993 | $ | 691,754 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Deposits | $ | 503,530 | $ | 513,053 | ||||
| Accrued Interest Payable | 2,236 | 2,477 | ||||||
| Short-Term Borrowings | 970 | 620 | ||||||
| Long-Term Debt | 30,000 | 85,000 | ||||||
| Other Liabilities | 10,481 | 9,140 | ||||||
| Total Liabilities | 547,217 | 610,290 | ||||||
| Commitments and Contingencies | ||||||||
| Shareholders’ Equity: | ||||||||
| Common Stock, par value $0.01 per share, 10,000,000 shares authorized; | ||||||||
|
7,317,560 shares issued; 6,011,012 and 6,017,582 shares outstanding,
respectively |
73 |
73 |
||||||
| Surplus | 9,233 | 9,233 | ||||||
| Accumulated Other Comprehensive Income, net of tax | 3,412 | 4,316 | ||||||
| Retained Earnings | 89,661 | 90,242 | ||||||
| Less Treasury Stock: 1,306,548 and 1,299,978 shares at cost, respectively | (21,205 | ) | (21,127 | ) | ||||
| Noncontrolling Interest | (1,398 | ) | (1,273 | ) | ||||
| Total Shareholders’ Equity | 79,776 | 81,464 | ||||||
| Total Liabilities and Shareholders’ Equity | $ | 626,993 | $ | 691,754 | ||||
CONTACT:
United Security Bancshares, Inc.
Robert Steen,
334-636-5424