1st Capital Bank (OTCBB: FISB), Monterey County's award
winning community bank, reported continued growth in core deposits
and loans for the second quarter of 2012. Overall, the Bank
reported an increase in total assets of 32% to $304 million as of
June 30, 2012, compared to $229 million for the same quarter one
year ago.
Key Performance Highlights of the Second Quarter 2012:
- Total assets of $304 million as of June 30, 2012 increased $74
million (32%) from June 30, 2011
- Core deposit growth of $73 million, or 37%, to a total of $270
million compared to the second quarter of 2011
- Loan growth of $38 million, or 20%, to a total of $228 million
compared to the second quarter of 2011
- 18% increase in net interest income compared to the same
quarter a year ago
- Continuing strong asset quality, with a ratio of nonperforming
loans to total loans of just 0.33%
- Strong capital position with a total risk based capital ratio
of 15.65%
- 2% Stock dividend paid to shareholders as of March 28,
2012
"1st Capital Bank has continued its strong growth in loans,
deposits and total assets. The Bank's results for the first two
quarters of 2012 continue to outperform most banks in the
industry," stated President and CEO Fred Rowden. "We are pleased
that the investment the Bank has made in key staff and facilities
in the past year has contributed to increased growth in the Bank's
deposits and earning assets. That additional growth will provide
the basis for future strong earnings growth. The Bank's investment
in personnel and infrastructure is a part of our long-term plan to
take advantage of market opportunities and is aimed at enhancing
shareholder value," concluded Mr. Rowden.
In conjunction with the Bank's strong loan and deposit growth,
the Bank recorded a number of increases, including a $330,000
increase in the provision for loan losses for the quarter ended
June 30, 2012 compared to the same quarter in 2011. It also
recorded increased non-interest costs of $404,000 from the above
discussed investment in staff and facilities compared to the same
quarter in the prior year and a tax expense of $152,000 for quarter
ended June 30, 2012 compared to a tax benefit of $1,313,000
recorded for the same period in the prior year as a result of the
deferred tax valuation allowance reversal in the prior year. These
increases were partially offset by a $441,000 increase in net
interest income compared to the same quarter a year ago.
Overall, increases in these key income statement categories are
consistent with the Bank's plans to grow. The positive results of
this planned growth are seen not only in the growing totals but
also in the composition of the loan and deposit portfolios as new,
quality customers join the Bank. The percentage of checking and
savings accounts compared to total deposits has increased to 86%
compared to 76% one year ago and the overall cost of deposits has
dropped from 0.56% to 0.34%. As the Bank continues to grow it is
leveraging its excess capital, as can be seen by current Total Risk
Based Capital of 15.7% compared to 17.5% one year ago. Likewise,
book value per share has increased to $10.10 as of June 30, 2012
compared to $9.88 one year ago.
The Bank's Financial Summary for the quarter ended June 30, 2012
is described below. For more information regarding the Bank's
growth and performance, please visit our website at
www.1stcapitalbank.com, or call 831.264.4000.
Financial Summary
Net Income -- Income before taxes of $361,000 for the quarter
ended June 30, 2012 compared to $660,000 for the same quarter in
the prior year. This decrease is largely due to an increase in the
provision for loan loss expense due to loan growth and an increase
in noninterest expense, partially offset by an increase in net
interest income. Net income of $209,000 for the quarter ended June
30, 2012 decreased $1,764,000 compared to net income of $1,973,000
for the same quarter in the prior year, and decreased $101,000 over
the net income for the trailing quarter ended March 31, 2012. This
decrease resulted from the factors outlined above, as well as
increased provision for income tax as the Bank recorded a $152,000
tax expense for the second quarter 2012 compared to a tax benefit
of $1,313,000 for the same period in 2011 due to the accounting
applied to taxes by the Bank during its then start-up period.
Basic and fully diluted earnings per share of $0.06 and $0.06,
respectively, for the three months ended June 30, 2012 continued to
add to retained earnings. These per share earnings decreased from
$0.62 and $0.62, basic and fully diluted, respectively, for the
same quarter a year ago.
Balance Sheet -- Total assets of $304
million as of June 30, 2012 increased $74 million (32%) from June
30, 2011 and increased $12 million (4%) from March 31, 2012. Loans
grew $38 million (20%) from June 30, 2011 to a total of $228
million as of June 30, 2012, with $26 million (13%) of that growth
occurring in the three-month period ended June 30, 2012. Loan
growth was funded largely by deposits, which grew $73 million (37%)
from June 30, 2011 to a total of $270 million as of June 30, 2012,
and increased by $12 million (5%) from the balances outstanding as
of March 31, 2012. As of June 30, 2012 the ratio of loans to
deposits increased to 84% compared to 78% as of March 31, 2012.
Interest Income and Expense -- Net
interest income for the quarter ended June 30, 2012 was $2,898,000,
an increase of $441,000 (18%) over the quarter ended June 30, 2011
and an increase of $182,000 (7%) over the trailing quarter ended
March 31, 2012.
Interest income for the quarter ended June 30, 2012 was
$3,122,000, an increase of $392,000 (14%) over the quarter ended
June 30, 2011 and an increase of $198,000 (7%) over the trailing
quarter ended March 31, 2012. Average earning assets for the
quarter ended June 30, 2012 were $288 million, an increase of $67
million (30%) and $18 million (7%) compared to the quarters ended
June 30, 2011, and March 31, 2012, respectively.
Interest expense for the quarter ended June 30, 2012 was
$224,000, a reduction of $49,000 (18%) from the quarter ended June
30, 2011 and an increase of $16,000 (8%) from the trailing quarter
ended March 31, 2012. Average interest bearing liabilities for the
quarter ended June 30, 2012 were $167 million, an increase of $24
million (17%) and $15 million (10%) compared to the quarters ended
June 30, 2011 and March 31, 2012, respectively. While the average
balances of interest-bearing deposit liabilities for the quarter
ended June 30, 2012 increased compared to June 30, 2011, interest
expense decreased due to the repricing of interest-bearing
deposits, reflecting the Bank's continued focus on managing its net
interest margin. Average noninterest bearing deposits of $97
million for the quarter ended June 30, 2012 grew $42 million (77%)
and $2 million (2%) compared to the quarters ended June 30, 2011
and March 31, 2012, respectively.
These changes in the composition and pricing of 1st Capital
Bank's earning assets and deposit liabilities resulted in a net
interest margin for the quarter ended June 30, 2012 of 4.1%
compared to 4.5% for the quarter ended June 30, 2011 and 4.1% for
the quarter ended March 31, 2012. This decrease from a year ago is
consistent with a change in the composition of earning assets as
strong growth in the deposit portfolio, which now has an overall
cost of just 0.34%, was temporarily deployed into Fed funds sold.
During these same measurement periods, the yield on the loan
portfolio decreased 10 basis points to 5.6% while the Bank
continued to reduce overall deposits costs from 0.56% for the three
month period ended June 30, 2011 to 0.34% for the period ended June
30, 2012.
Provision for Loan Losses -- 1st Capital Bank recorded a
provision for loan losses of $424,000 during the quarter ended June
30, 2012 compared to $94,000 in the quarter ended June 30, 2011 and
$40,000 in the trailing quarter ended March 31, 2012 as growth in
the loan portfolio and changes in the types of loans originated
required the additional reserve and as the Bank continued to
closely monitored the condition of its loan portfolio. The ratio of
the allowance for loan losses to total loans outstanding was 1.66%
at June 30, 2012 compared to 1.59% and 1.67% at June 30, 2011 and
March 31, 2012, respectively. The Bank's asset quality remained
high as compared with peers, with a ratio of impaired and
nonperforming loans to total loans of just 0.33% as of June 30,
2012. The Bank has never had any real estate acquired through
foreclosure.
Noninterest Income -- Noninterest income
decreased $6,000 (14%) to $37,000 for the quarter ended June 30,
2012 compared to the quarter ended June 30, 2011 and decreased
$1,000 (3%) compared to the trailing quarter ended March 31, 2012,
largely due to changes in the volume of fees for services.
Noninterest Expense -- Noninterest
expenses increased by $403,000 (23%) to $2.1 million for the
quarter ended June 30, 2012 compared to the quarter ended June 30,
2011 and decreased $28,000 (1%) compared to the trailing quarter
ended March 31, 2012. The majority of these increases were due to
the overall growth of the Bank and the investment by the Bank in
key personnel and enhanced facilities. Other expenses also
increased, due largely to increased stock-based compensation and
marketing costs.
Provision for Income Tax Expense -- A provision for income tax
expense of $152,000 was recorded during the quarter ended June 30,
2012. This compares to the net income tax benefit of $1,313,000
that was recorded in the second quarter of 2011. Recognition of the
tax benefit was a one-time event in the second quarter of 2011
resulting from removal of the valuation allowance previously
recognized against the Bank's net deferred tax asset as the
strength of actual and forecasted earnings eliminated the need for
this valuation allowance.
About 1st Capital Bank
1st Capital Bank is focused on providing lending, deposit and
highly efficient cash management services such as remote deposit
and online banking to small-to-medium size businesses and their
owners, and offers specialized banking services for the healthcare
industry. The Bank is a full service financial institution with
branches located in Monterey, Salinas and King City. The Bank's
corporate offices are located at 5 Harris Court, Building N, Suite
3, Monterey, California 93940. Please visit our website at
www.lstcapitalbank.com for more information. Member FDIC. Equal
Opportunity Lender. An SBA Preferred Lender.
1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands, except share and per share data)
3 Months Ended Percent Change From:
--------------------------------
Statement of Income June 30, March 31, June 30, March 31, June 30,
Data 2012 2012 2011 2012 2011
---------- ---------- ---------- --------- --------
Interest income
Loans (including
fees) $ 2,966 $ 2,779 $ 2,599 7% 14%
Investment
securities 106 103 107 3% (1%)
Other 50 42 24 19% 108%
---------- ---------- ----------
Total interest
income 3,122 2,924 2,730 7% 14%
---------- ---------- ----------
Interest expense
Interest on
deposits 224 208 273 8% (18%)
Other - - -
---------- ---------- ----------
Total interest
expense 224 208 273 8% (18%)
---------- ---------- ----------
Net interest income 2,898 2,716 2,457 7% 18%
Provision for loan
losses 424 40 94 960% 351%
---------- ---------- ----------
Net interest income
after provision
for loan losses 2,474 2,676 2,363 (8%) 5%
Noninterest income
Service charges on
deposits 21 22 16 (5%) 31%
Other 16 16 27 0% (41%)
---------- ---------- ----------
Total noninterest
income 37 38 43 (3%) (14%)
Noninterest
expenses
Salaries and
benefits 1,243 1,302 1,013 (5%) 23%
Occupancy 180 177 149 2% 21%
Furniture and
equipment 82 95 84 (14%) (2%)
Other 645 603 500 7% 29%
---------- ---------- ----------
Total noninterest
expenses 2,150 2,177 1,746 (1%) 23%
---------- ---------- ----------
Income before
provision for
income taxes 361 537 660 (33%) (45%)
Provision for
(benefit from)
income taxes 152 227 (1,313) (33%) (112%)
---------- ---------- ----------
Net income $ 209 $ 310 $ 1,973 (33%) (89%)
========== ========== ==========
Common Share Data
Earnings per share
Basic $ 0.06 $ 0.10 $ 0.61 (40%) (90%)
Diluted $ 0.06 $ 0.09 $ 0.61 (33%) (90%)
Weighted average
shares outstanding
Basic 3,223,836 3,220,947 3,220,853 0% 0%
Diluted 3,317,799 3,308,773 3,223,143 0% 3%
Book value per
share
Tangible book value
6 Months Ended
-------------------------------
Statement of Income June 30, Percent
Data 2012 2011 Change
---------- ---------- --------
Interest income
Loans (including
fees) $ 5,745 $ 5,126 12%
Investment
securities 209 213 (2%)
Other 92 43 114%
---------- ----------
Total interest
income 6,046 5,382 12%
---------- ----------
Interest expense
Interest on
deposits 432 526 (18%)
Other - -
---------- ----------
Total interest
expense 432 526 (18%)
---------- ----------
Net interest income 5,614 4,856 16%
Provision for loan
losses 464 367 26%
---------- ----------
Net interest income
after provision
for loan losses 5,150 4,489 15%
Noninterest income
Service charges on
deposits 43 29 48%
Other 32 41 (22%)
---------- ----------
Total noninterest
income 75 70 7%
Noninterest
expenses
Salaries and
benefits 2,545 1,922 32%
Occupancy 357 287 24%
Furniture and
equipment 177 161 10%
Other 1,248 933 34%
---------- ----------
Total noninterest
expenses 4,327 3,303 31%
---------- ----------
Income before
provision for
income taxes 898 1,256 (29%)
Provision for
(benefit from)
income taxes 379 (1,313) (129%)
---------- ----------
Net income $ 519 $ 2,569 (80%)
========== ==========
Common Share Data
Earnings per share
Basic $ 0.16 $ 0.80 (80%)
Diluted $ 0.16 $ 0.80 (80%)
Weighted average
shares outstanding
Basic 3,222,982 3,220,853 0%
Diluted 3,313,647 3,222,999 3%
Book value per
share $ 10.10 $ 9.88 2%
Tangible book value $ 10.10 $ 9.88 2%
1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)
Percent Change From:
June December June December 31, June 30,
Balance Sheet Data 2012 2011 2011 2011 2011
-------- -------- -------- ------------ --------
Assets
Cash and due from
banks $ 6,324 $ 8,910 $ 6,025 (29%) 5%
Federal funds sold
and overnight
deposits 42,060 60,062 16,033 (30%) 162%
Available-for-sale
securities, at
fair value, and
interest bearing
deposits 25,068 17,520 15,926 43% 57%
Loans:
Commercial 89,635 78,504 79,087 14% 13%
Real estate-
construction 4,167 4,126 3,743 1% 11%
Real estate-
other 132,261 115,902 105,212 14% 26%
Consumer 1,254 1,580 1,017 (21%) 23%
Deferred loan
fees, net 517 470 426 10% 21%
-------- -------- --------
Total loans 227,834 200,582 189,485 14% 20%
Allowance for
loan losses (3,784) (3,320) (3,022) 14% 25%
-------- -------- --------
Net loans 224,050 197,262 186,463 14% 20%
Premises and
equipment, net 1,314 615 658 114% 100%
Accrued interest
receivable and
other assets 4,704 3,946 4,097 19% 15%
-------- -------- --------
Total assets $303,520 $288,315 $229,202 5% 32%
======== ======== ========
Liabilities and
Shareholders'
Equity
Deposits:
Demand,
noninterest
bearing $ 99,883 $118,366 $ 59,647 (16%) 67%
Demand, interest
bearing 82,024 56,171 59,280 46% 38%
Savings 51,620 38,558 31,116 34% 66%
Time 36,649 42,488 47,093 (14%) (22%)
-------- -------- --------
Total deposits 270,176 255,583 197,136 6% 37%
Accrued interest
payable and other
liabilities 781 919 935 (15%) (16%)
Shareholders' equity 32,563 31,813 31,131 2% 5%
-------- -------- --------
Total liabilities
and shareholders'
equity $303,520 $288,315 $229,202 5% 32%
======== ======== ========
Asset Quality
Loans past due 90
days or more and
accruing interest $ - $ - $ -
Restructured loans 226 240 447 (6%) (49%)
Other nonaccrual
loans 534 - -
Other real estate
owned - - -
-------- -------- --------
Total
nonperforming
assets $ 760 $ 240 $ 447 217% 70%
======== ======== ========
Allowance for loan
losses to total
loans 1.66% 1.66% 1.59% 0% 4%
Allowance for loan
losses to NPL's 498% 1383% 676% (64%) (26%)
Allowance for loan
losses to NPA's 498% 1383% 676% (64%) (26%)
Regulatory Capital
and Ratios
Tier 1 capital $ 32,188 $ 31,490 $ 30,799 2% 5%
Total capital $ 34,994 $ 33,985 $ 33,181 3% 5%
Tier 1 capital
ratio 14.4% 15.8% 16.2% (9%) (11%)
Total risk based
capital ratio 15.7% 17.1% 17.5% (8%) (10%)
Tier 1 leverage
ratio 10.8% 12.6% 13.6% (14%) (21%)
1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)
3 Months Ended Percent Change From:
Selected Financial June 30, March 31, June 30, March 31, June 30,
Ratios 2012 2012 2011 2012 2011
-------- --------- -------- --------- --------
Return on average
total assets 0.28% 0.44% 3.48% (36%) (92%)
Return on average
shareholders' equity 2.59% 3.87% 26.74% (33%) (90%)
Net interest margin 4.1% 4.1% 4.5% (0%) (10%)
Efficiency ratio 73.25% 79.05% 69.84% (7%) 5%
Selected Average
Balances
Loans $214,583 $ 199,939 $184,379 7% 16%
Investment securities 17,790 15,732 13,535 13% 31%
Federal funds sold
and CD's 55,218 53,605 22,508 3% 145%
-------- --------- --------
Total earning assets $287,591 $ 269,276 $220,422 7% 30%
-------- --------- --------
Total assets $297,159 $ 280,238 $227,666 6% 31%
-------- --------- --------
Demand deposits -
interest bearing $ 81,168 $ 69,736 $ 62,750 16% 29%
Savings 48,242 41,557 32,109 16% 50%
Time deposits 37,704 41,051 47,733 (8%) (21%)
-------- --------- --------
Total interest
bearing liabilities $167,114 $ 152,344 $142,592 10% 17%
-------- --------- --------
Demand deposits -
noninterest bearing $ 96,972 $ 95,320 $ 54,660 2% 77%
-------- --------- --------
Shareholders' equity $ 32,513 $ 32,141 $ 29,591 1% 10%
-------- --------- --------
6 Months Ended
June 30,
Selected Financial Percent
Ratios 2012 2011 Change
-------- -------- -------
Return on average
total assets 0.36% 2.32% (84%)
Return on average
shareholders' equity 3.22% 17.74% (82%)
Net interest margin 4.0% 4.5% (10%)
Efficiency ratio 76.06% 67.05% 13%
Selected Average
Balances
Loans $207,261 $182,905 13%
Investment securities 16,761 13,861 21%
Federal funds sold
and CD's 54,412 19,147 184%
-------- --------
Total earning assets $278,434 $215,912 29%
-------- --------
Total assets $288,698 $222,834 30%
-------- --------
Demand deposits -
interest bearing $ 75,452 $ 59,795 26%
Savings 44,899 30,686 46%
Time deposits 39,377 48,356 (19%)
-------- --------
Total interest
bearing liabilities $159,728 $138,837 15%
-------- --------
Demand deposits -
noninterest bearing $ 96,146 $ 53,875 78%
-------- --------
Shareholders' equity $ 32,327 $ 29,202 11%
-------- --------
Contact Information Jayme Fields CFO (831) 264-4011
1st Capital Bancorp (QX) (USOTC:FISB)
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