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Coast Bancorp Third Quarter 2008 Earnings Announcement SAN LUIS OBISPO, CA--(MARKET WIRE)--Nov 12, 2008 -- Coast Bancorp (OTC BB:CTBP.OB - News), the
holding company for Coast National Bank, announced the unaudited
financial
results for the quarter ended September 30, 2008.
Total assets at September 30, 2008 were $190.4 million, a 3.6% increase from $183.8 million at December 31, 2007. Net loans at September 30, 2008 were $143.8 million, an increase of $1.5 million or 1.1% from $142.3 million at December 31, 2007. The recorded investment in impaired loans as of September 30, 2008 was $12.1 million, an increase of $0.4 million or 3.4% from $11.7 million at June 30, 2008, or an increase of $7.9 million or 188.1% from $4.2 million at December 31, 2007. Impaired loans as a percentage of total loans as of September 30 2008, June 30, 2008 and December 31, 2007 were 8.2%, 7.8% and 2.9% respectively. The allowance for loan and lease losses, which covers potential credit losses pertaining to the loan portfolio, was $2.8 million or 1.9% of total loans at September 30, 2008. The Company also carried an additional $55,000 allowance for credit losses pertaining to its unfunded commitments in the liability section of its balance sheet. Collectively, the total allowance for all types of credit losses was $2.9 million at September 30, 2008 as compared to $1.5 million at December 31, 2007, a 93.3% increase. Deposits as of September 30, 2008 were $147.7 million, a $14.4 million, or 8.9% decrease from $162.1 million at December 31, 2007. Total stockholders' equity decreased 2.8% to $13.7 million as of September 30, 2008 as compared to $14.1 million at December 31, 2007. The decrease was a result of the March 31, 2008 $1.5 million provision to the allowance for loan and lease losses. Despite the decrease in stockholders' equity, the Company remained "well capitalized" by regulatory standards. The Tier 1 Leverage Capital Ratio was 9.9% at September 30, 2008, or 4.4% above the "well capitalized" regulatory requirement of 5%. The Tier 1 Risk Based Capital Ratio was 11.5% at September 30, 2008, or 5.5% above the "well capitalized" regulatory requirement of 6%. The Total Risk Based Capital Ratio was 14.2% at September 30, 2008, or 4.2% above the "well capitalized" regulatory requirement of 10%. Net interest income before the provision for loan losses for the three months ended September 30, 2008 was $1.6 million, a decrease of 23.8% when compared to $2.1 million for the three months ended September 30, 2007. Net interest income before the provision for loan losses for the nine months ended September 30, 2008 was $4.9 million, a decrease of 23.4% when compared to $6.4 million for the nine months ended September 30, 2007. The decrease in net interest income was primarily attributable to a decreased net interest margin, partially offset by the increase in total loans. The net interest margin for the three months ended September 30, 2008 was 3.5% compared to 4.9% for the three months ended September 30, 2007. The net interest margin for the nine months ended September 30, 2008 was 3.8% compared to 5.1% for the nine months ended September 30, 2007. Non-interest income for the three months ending September 30, 2008 was $129,000, a decrease of 22.8%, compared to $167,000 for the three months ended September 30, 2007. The decrease was primarily due to more third quarter sales of SBA loans in 2007 than in 2008. Non-interest income for the nine months ending September 30, 2008 was $554,000, an increase of 31.6%, compared to $421,000 for the nine months ended September 30, 2007. The increased income was primarily derived from gains on the sale of SBA loans and of investments which was somewhat offset by a decrease of mortgage packaging fees. Non-interest expense for the three months ending September 30, 2008 was $1,692,000, a decrease of 3.3% compared to $1,749,000 for the three months ended September 30, 2007. Non-interest expense for the nine months ending September 30, 2008 was $4,998,000, a decrease of 6.4% compared to $5,341,000 for the nine months ended September 30, 2007. These reductions were primarily due to decreases in marketing and personnel expenses. Net income for the three months ending September 30, 2008 was $63,000, or $0.09 per diluted share, a 76.7% decrease from $270,000, or $0.36 per diluted share, for the three months ended September 30, 2007. The net loss for the nine months ending September 30, 2008 was $639,000, or ($0.97) per diluted share, a 180.6% decrease from net income of $793,000, or $0.72 per diluted share for the nine months ended September 30, 2007. The decrease is primarily due to the additional provision for loan losses made at March 31, 2008. Coast National Bank opened for business on September 16, 1997. The Bank is an independent community bank with five banking offices and a loan production office. With a focus on delivering unsurpassed customer service, the Bank provides small business loans, home loans and other loans, as well as an array of business and personal banking deposit products and other services. The Bank is a wholly owned subsidiary of Coast Bancorp, a $190 million bank holding company, headquartered in San Luis Obispo, California. Coast Bancorp stock trades under the ticker symbol "CTBP.OB." For more information, visit www.coastnationalbank.com or call 805.541.0400. Please refer to the following Consolidated Balance Sheets (unaudited) as of September 30, 2008 and December 31, 2007 and Consolidated Statements of Income (unaudited) for the three months ended September 30, 2008 and 2007 for specific information regarding the Company's financials.
Coast Bancorp and Subsidiary
Consolidated Balance Sheets (Unaudited)
September 30, 2008 and December 31, 2007
ASSETS September 30, December 31,
2008 2007
------------- -------------
Cash and due from banks $ 12,020,426 $ 6,923,496
Federal funds sold 14,100,000 14,350,000
------------- -------------
TOTAL CASH AND CASH EQUIVALENTS 26,120,426 21,273,496
Interest bearing deposits with other banks 5,000,000 -
Investment securities available for sale 1,660,678 7,694,486
Loans:
Commercial 61,850,172 41,498,791
Real estate - construction 45,954,064 41,044,155
Real estate - other 35,486,124 58,050,610
Consumer 3,570,884 3,339,550
------------- -------------
TOTAL LOANS 146,861,243 143,933,106
Net deferred loan fees (191,518) (162,696)
Allowance for credit losses (2,834,197) (1,487,131)
------------- -------------
NET LOANS 143,835,528 142,283,279
Premises and equipment 8,488,962 8,733,401
Deferred taxes 1,506,359 485,000
Federal Reserve Bank stock and Federal Home
Loan Bank stock, at cost 1,736,600 991,350
Other Real Estate Owned 770,000 770,000
Accrued interest and other assets 1,272,677 1,520,398
------------- -------------
TOTAL ASSETS $ 190,391,229 $ 183,751,410
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest-bearing demand $ 36,394,353 $ 42,989,733
Money market and NOW 42,154,527 45,959,276
Savings 7,410,773 6,454,025
Time deposits of $100,000 or more 43,285,816 49,012,877
Other time deposits 18,416,813 17,648,933
------------- -------------
TOTAL DEPOSITS 147,662,282 162,064,844
FHLB advances 20,000,000 -
Junior subordinated debt securities 7,217,000 7,217,000
Other liabilities 1,853,554 338,924
------------- -------------
TOTAL LIABILITIES 176,732,836 169,620,768
------------- -------------
Commitments and contingencies - -
Stockholders' equity:
Preferred stock - 10,000,000 authorized,
none outstanding - -
Common stock no par value; 10,000,000
shares authorized; issued and outstanding:
723,700 at September 30, 2008 and 713,000
at December 31, 2007 7,599,311 7,443,847
Additional paid-in capital 227,574 184,780
Retained earnings 5,823,242 6,462,202
Accumulated other comprehensive income -
net unrealized gains (losses) on
available-for-sale securities, net of
taxes of $5,744 at September 30, 2008
and $27,666 at December 31, 2007 8,266 39,813
------------- -------------
TOTAL STOCKHOLDERS' EQUITY 13,658,393 14,130,642
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 190,391,229 $ 183,751,410
============= =============
Coast Bancorp and Subsidiary
Consolidated Statements of Income (Unaudited)
For the Three and Nine Months Ended September 30, 2008 and 2007
For the Three Months For the Nine Months
Ended Ended
September 30, September 30,
---------------------- ----------------------
2008 2007 2008 2007
---------- ----------- ---------- ----------
Interest income:
Interest and fees on
loans $2,345,706 $ 3,146,832 $7,293,669 $9,526,037
Interest on investment
securities 34,424 128,483 182,031 323,758
Interest on federal funds
sold 98,944 223,340 250,870 668,821
Other interest income 56,378 16,837 93,252 59,019
---------- ----------- ---------- ----------
TOTAL INTEREST INCOME 2,535,453 3,515,492 7,819,823 10,577,635
Interest expense:
Interest on money market
and NOW accounts 147,235 394,778 562,094 1,224,390
Interest on savings
deposits 15,720 38,404 65,988 110,971
Interest on time deposits 480,298 882,650 1,715,411 2,512,132
Interest on FHLB advances 199,109 - 240,355 -
Interest on junior
subordinated debt
securities 115,255 129,539 345,766 371,395
---------- ----------- ---------- ----------
TOTAL INTEREST EXPENSE 957,618 1,445,371 2,929,615 4,218,888
Net interest income 1,577,834 2,070,121 4,890,207 6,358,747
Provision for loan losses - 25,000 1,605,000 50,000
---------- ----------- ---------- ----------
NET INTEREST INCOME
AFTER PROVISION FOR
CREDIT LOSSES 1,577,834 2,045,121 3,285,207 6,308,747
Non-interest income:
Service charges on
deposit accounts and
other 102,708 107,720 296,377 287,204
Gain on sale of
investments 2,188 - 74,292 -
Gain on sale of loans and
servicing fees 16,303 44,383 157,631 86,093
Mortgage packaging fees 7,963 15,243 25,791 52,773
Gain on sale of premises
and equipment - - - (4,970)
---------- ----------- ---------- ----------
TOTAL NON-INTEREST INCOME 129,162 167,346 554,091 421,100
Non-interest expense:
Salaries and benefits 949,024 939,927 2,737,953 2,852,311
Net occupancy expense
(net of rental income) 135,504 122,197 421,302 372,200
Equipment expense 55,309 75,875 176,138 232,295
Other expense 552,197 611,033 1,662,762 1,884,226
---------- ----------- ---------- ----------
TOTAL NON-INTEREST
EXPENSE 1,692,034 1,749,032 4,998,155 5,341,032
INCOME BEFORE TAXES 14,963 463,435 (1,158,856) 1,388,815
Income taxes (48,200) 193,100 (519,896) 595,400
---------- ----------- ---------- ----------
NET INCOME $ 63,164 $ 270,335 $ (638,959) $ 793,415
========== =========== ========== ==========
Per share data
Earnings per share -
Basic $ 0.09 $ 0.38 $ (0.89) $ 1.14
========== =========== ========== ==========
Earnings per share -
Diluted $ 0.09 $ 0.36 $ (0.88) $ 1.09
========== =========== ========== ==========Coast Bancorp and Subsidiary This news release contains forward-looking statements with respect to the financial condition, results of operation and business of Coast Bancorp and its subsidiaries. All financial results are unaudited and therefore subject to change. These include, but are not limited to, statements that relate to or are dependent on estimates or assumptions relating to the prospects of loan growth, credit quality and certain operating efficiencies resulting from the operations Coast National Bank. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) competitive pressure among financial services companies increases significantly; (2) changes in the interest rate environment on interest margins; (3) general economic conditions, internationally, nationally or in the State of California are less favorable than expected; (4) legislation or regulatory requirements or changes adversely affect the business in which the combined organization will be engaged. Contact: Contact:
Coast National Bank
805.541.0400
Source: Coast Bancorp
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