Attached files
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| 8-K - FORM 8-K - FIDELITY D & D BANCORP INC | v238022_8k.htm |
Exhibit 99.1
FIDELITY D & D BANCORP, INC.
FOR IMMEDIATE RELEASE
Date: October 25, 2011
Contacts:
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Daniel J. Santaniello
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Salvatore R. DeFrancesco, Jr.
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President and
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Treasurer and
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Chief Executive Officer
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Chief Financial Officer
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570-504-8035
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570-504-8000
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FIDELITY D & D BANCORP, INC.
REPORTS THIRD QUARTER 2011 FINANCIAL RESULTS
Dunmore, PA – Fidelity D & D Bancorp, Inc. (OTC Bulletin Board: FDBC), parent company of The Fidelity Deposit and Discount Bank, announced net income for the quarter ended September 30, 2011 of $1,327,000, an increase of $972,000 compared to $355,000 for the same quarter of 2010. Improvement in earnings occurred primarily from significantly less impairment charges required within other income over the previous year’s period. Earnings per share on a diluted basis for the quarter were $0.59 and $0.16 for the three months ended September 30, 2011 and 2010, respectively.
The Company’s assets grew $60,021,000, or 11%, to total $621,694,000 at September 30, 2011 from $561,673,000 at December 31, 2010. The growth resulted mainly from a 9% increase in deposits totaling $43,150,000, which took place within money market, non-interest-bearing checking and interest-bearing checking accounts, accordingly. The remainder occurred from a $9,456,000 rise in short-term borrowings with repurchase customers and $5,308,000 growth of shareholder’s equity.
“The results of the third quarter are reflective of the continued progress across the various divisions as we continue to focus on building a customer centric organization,” stated Daniel J. Santaniello, President and Chief Executive Officer. “Our increase in core deposits along with the growth in revenues within the Trust and Financial Services Division are indicative of the consumer and business clients’ confidence in Fidelity Bank. The growth in earnings builds upon and reinforces the Company’s strong capital position, which exceeds all regulatory requirements.”
Net income for the nine months ended September 30, 2011 was $3,843,000, an increase of $2,213,000 compared to net income of $1,630,000 for the same 2010 period. Earnings improvement occurred in the current year-to-date period from higher net interest income partially offset by the added provision for loan losses, higher financial service revenue, trust and interchange fees within other income, aside from the significantly lower impairment charges required, and other expense savings from less salaries and benefit expenses, compared to the prior year period. Earnings per share were $1.74 and $0.76 for the nine months ended September 30, 2011 and 2010, respectively.
Net interest income remained steady at $5,249,000 for the quarter ended September 30, 2011 against the $5,273,000 recorded during the same quarter of 2010. The cost reduction from lowering rates on interest bearing liabilities almost fully offset the effect lower interest rates had on reducing earning asset yields. This, along with higher levels of average earning assets, reduced net interest margin to 3.85% for the third quarter of 2011, compared to 3.93% for same 2010 period.
Net interest income increased $151,000, or 1%, to $15,800,000 for the nine months ended September 30, 2011 from $15,649,000 recorded during the same period of 2010. Net interest margin was 3.97% during the first nine months of 2011 compared to 3.92% during the first nine months of 2010.
The provision for loan loss was $500,000 and $375,000 for the third quarter ending September 30, 2011 and 2010, respectively. Provision for loan loss was $1,350,000 for the nine months ending September 30, 2011, as compared to $1,250,000 for the same 2010 period. The allowance for loan losses was 1.99% of total loans at September 30, 2011, up from 1.77% at September 30, 2010.
The decrease in other-than-temporary impairment (OTTI) credit losses was from a $1,749,000 required charge for the quarter ended September 30, 2010, compared with $5,800 for the quarter ended September 30, 2011. Total other income recorded for the quarter ended September 30, 2011 was $1,477,000, comparable in total to the $1,478,000 recorded for the same quarter in 2010.
The decrease in OTTI credit losses was from a $2,503,000 required charge for the nine months ended September 30, 2010, compared with $80,000 for the nine months ended September 30, 2011. Total other income for the nine months ended September 30, 2011 was $4,287,000, a $268,000, or 7%, increase compared to $4,019,000 for the same period in 2010. This increase for the year-to-date period resulted primarily from $171,000 more financial services revenue, additional earned interchange fees of $114,000, plus the $60,000 more in realized gains on loans sold along with the addition of $53,000 in trust fees for the nine months ended September 30, 2011, when compared to the same 2010 period.
Total other operating expenses were $4,444,000 compared to $4,318,000 for the quarters ending September 30, 2011 and 2010, respectively. The other operating expenses increased primarily from $140,000 of additional collection and ORE costs realized during the third quarter 2011.
Total other operating expenses decreased $562,000, or 4%, to $13,554,000 for the nine months ending September 30, 2011 from $14,116,000 for the same 2010 period. The decline in other operating expenses resulted from $188,000 less salaries and benefits, excluding the $398,000 of early retirement and severance costs incurred in 2010, $127,000 lower FDIC premiums and $79,000 less advertising partially offset by $197,000 added occupancy and equipment expenses incurred in the 2011 year-to-date period.
Fidelity D & D Bancorp, Inc. serves Lackawanna and Luzerne Counties through The Fidelity Deposit and Discount Bank’s 11 community banking office locations. The Bank's deposits are insured by the Federal Deposit Insurance Corporation up to the full extent permitted by law.
For more information please visit our investor relations web site located through www.bankatfidelity.com.
Forward-Looking Statements
Certain of the matters discussed in this press release may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and as such may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. The words “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” and similar expressions are intended to identify such forward-looking statements.
The Company’s actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation:
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the effects of economic deterioration on current customers, specifically the effect of the economy on loan customers’ ability to repay loans;
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the costs and effects of litigation and of unexpected or adverse outcomes in such litigation;
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governmental monetary and fiscal policies, as well as legislative and regulatory changes;
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the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters;
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the risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities and interest rate protection agreements, as well as interest rate risks;
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the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in Mid Penn’s market area and elsewhere, including institutions operating locally, regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet;
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technological changes;
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acquisitions and integration of acquired businesses;
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the failure of assumptions underlying the establishment of reserves for loan and lease losses and estimations of values of collateral and various financial assets and liabilities;
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volatilities in the securities markets;
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deteriorating economic conditions
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acts of war or terrorism; and
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disruption of credit and equity markets.
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FIDELITY D & D BANCORP, INC.
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Unaudited Condensed Consolidated Balance Sheets
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At Period End:
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September 30, 2011
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December 31, 2010
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||||||
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Assets
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||||||||
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Total cash and cash equivalents
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$ | 76,125,973 | $ | 22,967,345 | ||||
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Investment securities
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106,147,070 | 83,431,371 | ||||||
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Federal Home Loan Bank Stock
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3,894,100 | 4,542,000 | ||||||
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Loans and leases
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400,768,357 | 416,014,151 | ||||||
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Allowance for loan losses
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(7,959,946 | ) | (7,897,822 | ) | ||||
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Premises and equipment, net
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13,845,811 | 14,763,873 | ||||||
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Life insurance cash surrender value
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9,660,343 | 9,424,926 | ||||||
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Other assets
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19,212,424 | 18,427,308 | ||||||
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Total assets
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$ | 621,694,132 | $ | 561,673,152 | ||||
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Liabilities
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Non-interest-bearing deposits
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$ | 100,668,398 | $ | 85,780,392 | ||||
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Interest-bearing deposits
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424,928,869 | 396,667,300 | ||||||
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Total deposits
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525,597,267 | 482,447,692 | ||||||
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Short-term borrowings
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18,004,896 | 8,548,400 | ||||||
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Long-term debt
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21,000,000 | 21,000,000 | ||||||
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Other liabilities
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5,009,639 | 2,903,045 | ||||||
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Total liabilities
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569,611,802 | 514,899,137 | ||||||
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Shareholders' equity
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52,082,330 | 46,774,015 | ||||||
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Total liabilities and shareholders' equity
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$ | 621,694,132 | $ | 561,673,152 | ||||
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Average Year-To-Date Balances:
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September 30, 2011
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December 31, 2010
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Assets
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Total cash and cash equivalents
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$ | 49,149,509 | $ | 42,181,685 | ||||
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Investment securities
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97,352,090 | 84,050,381 | ||||||
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Loans and leases, net
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404,246,812 | 419,748,250 | ||||||
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Premises and equipment, net
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14,336,415 | 14,975,020 | ||||||
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Other assets
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27,006,573 | 26,598,374 | ||||||
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Total assets
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$ | 592,091,399 | $ | 587,553,710 | ||||
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Liabilities
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Non-interest-bearing deposits
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$ | 103,272,146 | $ | 76,707,139 | ||||
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Interest-bearing deposits
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402,982,055 | 405,518,509 | ||||||
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Total deposits
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506,254,201 | 482,225,648 | ||||||
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Short-term borrowings and long-term debt
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33,130,450 | 53,823,711 | ||||||
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Other liabilities
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3,165,662 | 3,626,830 | ||||||
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Total liabilities
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542,550,313 | 539,676,189 | ||||||
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Shareholders' equity
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49,541,086 | 47,877,521 | ||||||
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Total liabilities and shareholders' equity
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$ | 592,091,399 | $ | 587,553,710 | ||||
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FIDELITY D & D BANCORP, INC.
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Unaudited Condensed Consolidated Statements of Income
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Three Months Ended
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Nine Months Ended
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Sep. 30, 2011
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Sep. 30, 2010
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Sep. 30, 2011
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Sep. 30, 2010
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Interest income
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Loans
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$ | 5,672,989 | $ | 6,213,939 | $ | 17,500,733 | $ | 18,598,274 | ||||||||
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Securities and other
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703,282 | 739,761 | 2,023,443 | 2,366,910 | ||||||||||||
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Total interest income
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6,376,271 | 6,953,700 | 19,524,176 | 20,965,184 | ||||||||||||
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Interest expense
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Deposits
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851,930 | 1,244,438 | 2,908,593 | 3,958,215 | ||||||||||||
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Borrowings and debt
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275,606 | 436,490 | 815,481 | 1,357,982 | ||||||||||||
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Total interest expense
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1,127,536 | 1,680,928 | 3,724,074 | 5,316,197 | ||||||||||||
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Net interest income
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5,248,735 | 5,272,772 | 15,800,102 | 15,648,987 | ||||||||||||
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Provision for loan losses
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500,000 | 375,000 | 1,350,000 | 1,250,000 | ||||||||||||
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OTTI - credit losses
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5,798 | 1,748,674 | 80,490 | 2,503,596 | ||||||||||||
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Other income
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1,476,888 | 1,478,263 | 4,287,138 | 4,019,146 | ||||||||||||
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Other expenses
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4,443,632 | 4,317,611 | 13,553,687 | 14,116,215 | ||||||||||||
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Provision (credit) for income taxes
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449,077 | (45,193 | ) | 1,260,412 | 168,527 | |||||||||||
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Net income
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$ | 1,327,116 | $ | 354,943 | $ | 3,842,651 | $ | 1,629,795 | ||||||||
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Three Months Ended
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Sep. 30, 2011
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Jun. 30, 2011
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Interest income
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Loans
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$ | 5,672,989 | $ | 5,893,231 | $ | 5,934,513 | $ | 6,010,455 | $ | 6,213,939 | ||||||||||
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Securities and other
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703,282 | 704,301 | 615,860 | 604,335 | 739,761 | |||||||||||||||
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Total interest income
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6,376,271 | 6,597,532 | 6,550,373 | 6,614,790 | 6,953,700 | |||||||||||||||
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Interest expense
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Deposits
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851,930 | 1,014,786 | 1,041,877 | 1,119,838 | 1,244,438 | |||||||||||||||
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Borrowings and debt
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275,606 | 264,998 | 274,877 | 390,980 | 436,490 | |||||||||||||||
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Total interest expense
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1,127,536 | 1,279,784 | 1,316,754 | 1,510,818 | 1,680,928 | |||||||||||||||
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Net interest income
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5,248,735 | 5,317,748 | 5,233,619 | 5,103,972 | 5,272,772 | |||||||||||||||
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Provision for loan losses
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500,000 | 375,000 | 475,000 | 835,000 | 375,000 | |||||||||||||||
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OTTI - credit losses
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5,798 | - | 74,692 | 9,332,322 | 1,748,674 | |||||||||||||||
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Other income
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1,476,888 | 1,397,620 | 1,412,630 | 695,159 | 1,478,263 | |||||||||||||||
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Other expenses
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4,443,632 | 4,620,227 | 4,489,828 | 796,137 | 4,317,611 | |||||||||||||||
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Provision (credit) for income taxes
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449,077 | 431,491 | 379,844 | (2,724,896 | ) | (45,193 | ) | |||||||||||||
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Net income (loss)
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$ | 1,327,116 | $ | 1,288,650 | $ | 1,226,885 | $ | (2,439,432 | ) | $ | 354,943 | |||||||||
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FIDELITY D & D BANCORP, INC.
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Unaudited Condensed Consolidated Balance Sheets
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At Period End:
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Sep. 30, 2011
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Jun. 30, 2011
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Assets
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Total cash and cash equivalents
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$ | 76,125,973 | $ | 46,676,456 | $ | 47,443,267 | $ | 22,967,345 | $ | 47,571,175 | ||||||||||
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Investment securities
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106,147,070 | 98,804,727 | 90,881,865 | 83,431,371 | 87,255,681 | |||||||||||||||
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Federal Home Loan Bank Stock
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3,894,100 | 4,099,100 | 4,314,900 | 4,542,000 | 4,781,100 | |||||||||||||||
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Loans
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400,768,357 | 406,816,473 | 419,806,900 | 416,014,151 | 422,688,600 | |||||||||||||||
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Allowance for loan losses
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(7,959,946 | ) | (8,143,644 | ) | (8,223,978 | ) | (7,897,822 | ) | (7,484,253 | ) | ||||||||||
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Premises and equipment, net
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13,845,811 | 14,165,537 | 14,421,943 | 14,763,873 | 14,649,763 | |||||||||||||||
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Life insurance cash surrender value
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9,660,343 | 9,580,713 | 9,501,732 | 9,424,926 | 9,347,707 | |||||||||||||||
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Other assets
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19,212,424 | 16,684,545 | 18,149,883 | 18,427,308 | 17,788,825 | |||||||||||||||
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Total assets
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$ | 621,694,132 | $ | 588,683,907 | $ | 596,296,512 | $ | 561,673,152 | $ | 596,598,598 | ||||||||||
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Liabilities
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Non-interest-bearing deposits
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$ | 100,668,398 | $ | 98,751,100 | $ | 113,283,383 | $ | 85,780,392 | $ | 81,819,441 | ||||||||||
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Interest-bearing deposits
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424,928,869 | 408,176,375 | 399,916,954 | 396,667,300 | 409,063,486 | |||||||||||||||
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Total deposits
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525,597,267 | 506,927,475 | 513,200,337 | 482,447,692 | 490,882,927 | |||||||||||||||
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Short-term borrowings
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18,004,896 | 8,006,876 | 11,131,104 | 8,548,400 | 21,804,259 | |||||||||||||||
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Long-term debt
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21,000,000 | 21,000,000 | 21,000,000 | 21,000,000 | 32,000,000 | |||||||||||||||
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Other liabilities
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5,009,639 | 2,403,374 | 2,662,440 | 2,903,045 | 3,235,939 | |||||||||||||||
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Total liabilities
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569,611,802 | 538,337,725 | 547,993,881 | 514,899,137 | 547,923,125 | |||||||||||||||
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Shareholders' equity
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52,082,330 | 50,346,182 | 48,302,631 | 46,774,015 | 48,675,473 | |||||||||||||||
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Total liabilities and shareholders' equity
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$ | 621,694,132 | $ | 588,683,907 | $ | 596,296,512 | $ | 561,673,152 | $ | 596,598,598 | ||||||||||
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Average Quarterly Balances:
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Sep. 30, 2011
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Jun. 30, 2011
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Assets
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Total cash and cash equivalents
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$ | 64,037,252 | $ | 44,363,707 | $ | 38,769,905 | $ | 53,297,299 | $ | 44,858,721 | ||||||||||
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Investment securities
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103,623,523 | 98,646,270 | 89,632,732 | 86,120,978 | 83,361,340 | |||||||||||||||
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Loans, net
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393,770,647 | 408,046,954 | 411,113,414 | 409,008,829 | 416,462,967 | |||||||||||||||
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Premises and equipment, net
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14,065,472 | 14,311,407 | 14,638,667 | 14,648,400 | 14,854,405 | |||||||||||||||
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Other assets
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26,463,606 | 27,051,362 | 27,516,317 | 27,381,576 | 26,404,370 | |||||||||||||||
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Total assets
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$ | 601,960,500 | $ | 592,419,700 | $ | 581,671,035 | $ | 590,457,082 | $ | 585,941,803 | ||||||||||
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Liabilities
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Non-interest-bearing deposits
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$ | 99,025,084 | $ | 108,881,749 | $ | 101,941,654 | $ | 82,019,125 | $ | 75,830,989 | ||||||||||
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Interest-bearing deposits
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414,747,656 | 401,789,643 | 392,160,656 | 404,692,893 | 406,630,065 | |||||||||||||||
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Total deposits
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513,772,740 | 510,671,392 | 494,102,310 | 486,712,018 | 482,461,054 | |||||||||||||||
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Short-term borrowings and long-term debt
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33,707,094 | 29,180,335 | 36,534,997 | 51,089,956 | 50,958,606 | |||||||||||||||
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Other liabilities
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3,191,234 | 3,048,360 | 3,258,128 | 3,995,850 | 3,509,030 | |||||||||||||||
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Total liabilities
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550,671,068 | 542,900,087 | 533,895,435 | 541,797,824 | 536,928,690 | |||||||||||||||
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Shareholders' equity
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51,289,432 | 49,519,613 | 47,775,600 | 48,659,258 | 49,013,113 | |||||||||||||||
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Total liabilities and shareholders' equity
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$ | 601,960,500 | $ | 592,419,700 | $ | 581,671,035 | $ | 590,457,082 | $ | 585,941,803 | ||||||||||
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FIDELITY D & D BANCORP, INC.
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Selected Financial Ratios and Other Data
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Three Months Ended
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Sep. 30, 2011
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Jun. 30, 2011
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Selected returns and financial ratios
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Diluted earnings (loss) per share
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$ | 0.59 | $ | 0.59 | $ | 0.56 | $ | (2.26 | ) | $ | 0.16 | |||||||||
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Dividends per share
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$ | 0.25 | $ | 0.25 | $ | 0.25 | $ | 0.25 | $ | 0.25 | ||||||||||
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Yield on interest-earning assets (FTE)
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4.65 | % | 4.94 | % | 5.03 | % | 4.87 | % | 5.14 | % | ||||||||||
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Cost of interest-bearing liabilities
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1.00 | % | 1.19 | % | 1.25 | % | 1.32 | % | 1.46 | % | ||||||||||
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Net interest spread
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3.65 | % | 3.75 | % | 3.78 | % | 3.55 | % | 3.68 | % | ||||||||||
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Net interest margin
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3.85 | % | 4.01 | % | 4.05 | % | 3.79 | % | 3.93 | % | ||||||||||
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Return on average assets
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0.87 | % | 0.87 | % | 0.86 | % | -3.25 | % | 0.24 | % | ||||||||||
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Return on average equity
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10.27 | % | 10.44 | % | 10.41 | % | -39.42 | % | 2.87 | % | ||||||||||
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Efficiency ratio
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64.16 | % | 67.08 | % | 65.51 | % | 58.61 | % | 62.10 | % | ||||||||||
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Expense ratio
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1.96 | % | 2.19 | % | 2.15 | % | 1.68 | % | 1.92 | % | ||||||||||
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Nine Months Ended
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Sep. 30, 2011
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Sep. 30, 2010
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Diluted earnings per share
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$ | 1.74 | $ | 0.76 | ||||
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Dividends per share
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$ | 0.75 | $ | 0.75 | ||||
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Yield on interest-earning assets (FTE)
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4.87 | % | 5.20 | % | ||||
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Cost of interest-bearing liabilities
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1.14 | % | 1.54 | % | ||||
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Net interest spread
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3.73 | % | 3.66 | % | ||||
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Net interest margin
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3.97 | % | 3.92 | % | ||||
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Return on average assets
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0.87 | % | 0.37 | % | ||||
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Return on average equity
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10.37 | % | 4.58 | % | ||||
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Efficiency ratio
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65.52 | % | 67.68 | % | ||||
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Expense ratio
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2.10 | % | 2.21 | % | ||||
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Other data
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Sep. 30, 2011
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Jun. 30, 2011
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Mar. 31, 2011
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Dec. 31, 2010
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Sep. 30, 2010
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Book value per share
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$ | 23.26 | $ | 22.70 | $ | 21.96 | $ | 21.48 | $ | 22.50 | ||||||||||
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Equity to assets
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8.38 | % | 8.55 | % | 8.10 | % | 8.33 | % | 8.16 | % | ||||||||||
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Allowance for loan losses to:
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Total loans
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1.99 | % | 2.00 | % | 1.96 | % | 1.90 | % | 1.77 | % | ||||||||||
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Non-accrual loans
|
1.00 | x | 0.85 | x | 0.87 | x | 0.79 | x | 0.78 | x | ||||||||||
|
Non-accrual loans to total loans
|
1.99 | % | 2.36 | % | 2.25 | % | 2.40 | % | 2.27 | % | ||||||||||
|
Non-performing assets to total assets
|
2.43 | % | 2.37 | % | 2.37 | % | 2.38 | % | 2.22 | % | ||||||||||