LICB Long Island Financial (MM)

Long Island Financial Corp. (the "Company") (NASDAQ/NMS: LICB), the holding company for Long Island Commercial Bank (the "Bank"), today reported net income of $807,000, or $.51 per diluted share, for the three months ended June 30, 2005, compared to a loss of $897,000, or $.56 per diluted share for the three months ended June 30, 2004. For the six months ended June 30, 2005, the Company reported net income $1.7 million, or $1.05 per diluted share, compared to net income of $24,000, or $.02 per diluted share, for the six months ended June 30, 2004. The financial results for the three and six months ended June 30, 2004, were substantially impacted by provisions both for loan losses and automobile loan expenses recognized with regard to the Company's automobile loan portfolio. Total assets amounted to $539.7 million at June 30, 2005, a decrease of $5.8 million, or 1.1%, from the $545.5 million held at June 30, 2004. At June 30, 2005, loans, excluding automobile loans, net of unearned income and deferred fees, had increased by $30.7 million, or 15.0%, from the June 30, 2004 level. Year-over-year, the average balance of demand deposits increased $10.0 million, or 10.5%, from $96.1 million for the six months ended June 30, 2004, to $106.1 million for the six months ended June 30, 2005. The average balance of savings deposits increased by $18.1 million, or 17.6%, from $103.2 million at June 30, 2004, to $121.3 million at June 30, 2005. Automobile Loans As discussed in prior quarter press releases, the Company continues to monitor the performance of its automobile loan portfolio. At June 30, 2005, the automobile loan portfolio consisted of 664 loans with balances aggregating $13.1 million. Automobile loans represented 5.3% of the Bank's loan portfolio, net of unearned income and deferred fees. Delinquencies at June 30, 2005, were $227,102, or 1.7% of the portfolio. The Company incurred operating expenses relating to the automobile loan portfolio of $131,000 for the quarter ended June 30, 2005, compared to $798,000 for the quarter ended June 30, 2004. Those expenses include expenses for legal services, portfolio servicing and administration, collateral perfection, verification and disposition, and audit and accounting services. While the Company expects to continue to incur operating expenses related to the automobile loan portfolio, it expects those expenses to decrease as the portfolio matures. Operating costs for the automobile loan portfolio are expensed when incurred and recorded in "automobile loan expense" in the consolidated statements of earnings. Summary "We are particularly pleased with our financial results to date," stated Douglas C. Manditch, President and Chief Executive Officer, "Our ability to generate core business in the current environment is being demonstrated this year with continued growth in our loan portfolio despite rapid run-off in the automobile loan portfolio. Core deposits such as demand and savings scored double-digit gains year-over-year in period-end balances, and more importantly, average balances." Continuing, he added: "We are cautiously optimistic moving into the second half of 2005. While we are encouraged by the disposition of automobiles resulting in less than projected losses during May and June, we still face an extremely competitive environment with the automobile loan portfolio. We also expect that continued growth in our loan portfolio will necessitate modest quarterly provisions, similar to the $50,000 provision made for the three months ended June 30, 2005." On May 25, 2005, the Board of Directors of Long Island Financial Corp. declared a dividend of $.12 per common share. The dividend was paid on July 1, 2005, to stockholders of record on June 17, 2005. Long Island Commercial Bank, the wholly-owned subsidiary of Long Island Financial Corp., is a New York state chartered commercial bank, which began operations in January of 1990, and provides commercial and consumer banking services through twelve branch offices, maintaining its headquarters in Islandia. The Bank is an independent local bank emphasizing personal service and responsiveness to the needs of its customers. -0- *T Branch Offices Suffolk County, N.Y. Nassau County, N.Y. Kings County, N.Y. Islandia Babylon Jericho Westbury Bay Ridge-Brooklyn Central Islip Deer Park Melville Ronkonkoma Shirley Smithtown Hauppauge *T This release may contain certain forward-looking statements, which are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact the Company's earnings in future periods. Factors that could cause future results to vary materially from current management expectations include, but are not limited to, general economic conditions, changes in interest rates, deposit flows, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation or regulation; and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products, and services. -0- *T LONG ISLAND FINANCIAL CORP. Consolidated Balance Sheets (Unaudited) (In thousands, except share data) June 30, December 31, June 30, 2005 2004 2004 Assets: Cash and due from banks $ 11,539 $ 10,310 $ 11,383 Interest earning deposits 1,441 37 177 Federal funds sold - - - -------- -------- -------- Total cash and cash equivalents 12,980 10,347 11,560 Securities available-for-sale, at fair value 255,545 278,814 269,735 Federal Home Loan Bank stock, at cost 4,200 4,925 6,800 Loans, held for sale 838 604 1,257 Loans, net of unearned income and deferred fees 249,125 243,477 239,150 Less allowance for loan losses (4,066) (5,591) (6,722) -------- -------- -------- Loans, net 245,059 237,886 232,428 Premises and equipment, net 5,220 5,422 5,710 Accrued interest receivable 3,203 3,342 3,162 Bank owned life insurance 7,924 7,779 7,646 Deferred tax asset, net 2,896 3,169 5,423 Prepaid expenses and other assets 1,814 2,521 1,802 -------- -------- -------- Total assets $539,679 $554,809 $545,523 -------- -------- -------- Liabilities and Stockholders' Equity: Deposits: Demand deposits $112,424 $ 99,876 $ 97,259 Savings deposits 118,786 123,142 106,518 NOW and money market deposits 106,400 126,509 77,140 Time deposits, $100,000 or more 15,272 9,863 11,864 Other time deposits 62,974 58,905 73,043 -------- -------- -------- Total deposits 415,856 418,295 365,824 Federal funds purchased and securities sold under agreements to repurchase 13,000 27,500 69,900 Other borrowings 71,000 71,000 76,000 Subordinated debentures 7,732 7,732 7,732 Accrued expenses and other liabilities 3,584 3,245 3,453 -------- -------- -------- Total liabilities $511,172 $527,772 $522,909 -------- -------- -------- Stockholders' equity: Common stock (par value $.01 per share; 10,000,000 shares authorized; 1,878,792, 1,850,378, and 1,842,850 shares issued; 1,541,892, 1,513,478, and 1,505,950 shares outstanding, respectively) 19 19 18 Surplus 22,165 21,590 21,400 Accumulated surplus 12,716 11,417 9,996 Accumulated other comprehensive loss (2,215) (1,811) (4,622) Treasury stock at cost, (336,900 shares) (4,178) (4,178) (4,178) -------- -------- -------- Total stockholders' equity 28,507 27,037 22,614 -------- -------- -------- Total liabilities and stockholders' equity $539,679 $554,809 $545,523 -------- -------- -------- LONG ISLAND FINANCIAL CORP. Consolidated Statements of Earnings (Unaudited) (In thousands, except share data) For the Three Months For the Six Months Ended June 30, Ended June 30, 2005 2004 2005 2004 Interest income: Loans $ 4,070 $ 3,871 $ 8,021 $ 7,671 Securities 2,838 2,757 5,775 5,304 Federal funds sold and earning deposits 62 3 72 5 ----------- ---------- --------- --------- Total interest income 6,970 6,631 13,868 12,980 ---------- ----------- --------- ---------- Interest expense: Savings deposits 490 272 911 563 NOW and money market deposits 579 223 1,013 459 Time deposits, $100,000 or more 101 60 171 129 Other time deposits 551 593 1,058 1,241 Borrowed funds 839 871 1,760 1,637 Subordinated debentures 209 206 415 413 ---------- --------- ------- ------ Total interest expense 2,769 2,225 5,328 4,442 ---------- ---------- -------- ------ Net interest income 4,201 4,406 8,540 8,538 --------- -------- --------- -------- Provision for loan losses 50 5,000 12 5,500 --------- -------- --------- -------- Net interest income after provision for loan losses 4,151 (594) 8,415 3,038 --------- ---------- -------- -------- Other operating income: Service charges on deposit accounts 706 618 1,344 1,270 Net gain on sales and calls of securities - 2,483 - 2,880 Net gain on sale of residential loans 147 204 283 396 Earnings on bank- owned life insurance 91 100 180 395 Other 226 128 391 263 --------- -------- ------- ------- Total other operating income 1,170 3,533 2,198 5,204 --------- -------- ------- ------- Other operating expenses: Salaries and employee benefits 2,158 1,870 4,252 4,001 Occupancy expense 342 314 684 629 Premises and equipment expense 377 379 720 766 Automobile loan expense 131 798 254 855 Other 1,063 1,067 2,113 2,160 --------- -------- -------- -------- Total other operating expenses 4,071 4,428 8,023 8,411 --------- -------- --------- -------- Income before income taxes 1,250 (1,489) 2,590 (169) Income taxes 443 (592) 923 (193) --------- ---------- -------- --------- Net income $ 807 $ (897)$ 1,667 $ 24 --------- ---------- ---------- --------- Basic earnings per share $ .53 $ (.60)$ 1.09 $ .02 --------- ---------- ---------- --------- Diluted earnings per share$ .51 $ (.56)$ 1.05 $ .02 --------- ---------- ---------- --------- Weighted average shares outstanding 1,533,004 1,503,606 1,527,443 1,501,067 ------------------------------------------- Diluted weighted average shares outstanding 1,592,957 1,588,510 1,590,321 1,585,710 ------------------------------------------- LONG ISLAND FINANCIAL CORP. (Unaudited) (In thousands, except share data) June 30 December 31 June 30, 2005 2004 2004 ---- ---- ---- ASSET QUALITY RATIOS AND OTHER DATA Total non- performing loans (1) $ - $ 89 $ 56 Allowance for loan losses 4,066 5,591 6,722 Non-performing loans as a percent of total loans, net (1)(2) - % .04 % .02 % Non-performing loans as a percent of total assets (1) - % .02 % .01 % Allowance for loan losses as a percent of Non-performing loans (1) - % 6,282 % 12,004 % Total loans, net (2) 1.63 % 2.30 % 2.81 % Book value per share $ 18.49 $ 17.86 $ 15.02 Book value per share, as adjusted (3) $ 19.92 $ 19.06 $ 18.09 Shares outstanding 1,541,892 1,513,478 1,505,950 Full service offices 12 12 12 For the Three Months For the Six Months Ended June 30 Ended June 30 2005 2004 2005 2004 Interest rate spread 2.66% 3.02% 2.74% 2.97% Net interest margin 3.19% 3.40% 3.24% 3.35% *T (1) Non-performing loans consist of all non-accrual loans and all other loans 90 days or more past due and still accruing interest. It is the Company's policy to generally cease accruing interest on all loans 90 days or more past due. (2) Loans include loans, net of unearned income and deferred fees. (3) Excludes net unrealized depreciation/appreciation in available-for-sale securities, net of tax.