NET INCOME UP 61%
ONTARIO, Calif., July 14 /PRNewswire-FirstCall/ -- ICB Financial
(OTC Bulletin Board: ICBN) Financial Performance highlights for the first half
and quarter ended June 30, 2008 include:
-- Net income of $696,000 for the six months ended June 30, 2008; this
represents an increase of 61.9% when compared to the $430,000 for the first
six months of 2007.
-- Total assets increased 9%; $252.9 million as of June 30, 2008 compared
to $230.8 million a year earlier, an increase of $22.1 million.
-- Gross interest revenue of $7.5 million for the current six months
compared to $7.2 million for the six months ended June 30, 2007, an increase
of 5.0%.
-- Total loans at June 30, 2008 were up $35.6 million over June 30, 2007,
an increase of 20.5%.
-- Total deposit growth of 1.3% or $2.6 million through June 30, 2008 over
June 30, 2007.
-- Earnings per basic and fully diluted common share for the six months
ended June 30, 2008 were $0.13 compared to $0.08 for the same period in 2007,
an increase of 62.5%.
-- Return on average assets for the six months ended June 30, 2008 is
0.60% compared to 0.46% in 2007, an increase of 30.4% for the period.
-- Efficiency ratio was down to 73.3% in 2008 from 87.7% in 2007, an
improvement of 16.4%.
-- Annualized total revenue per Full Time Equivalent employee (FTE) was
$195,000 for the first six months of 2008 verses $145,000 for the first six
months of 2007, a 34% improvement.
To Our Customers and Shareholders:
As the public continues to feel the effects and to criticize the general
economic conditions prevailing in the Country, and finger pointing escalates
from the abuses which have occurred in the mortgage industry, it is important
to separate community banks from the criticisms generally aimed at the
financial services industry. Although there are some community banks operating
in the Inland Empire that are experiencing difficulties there are equally as
many that have had the foresight to avoid extensive participation in those
business segments that are causing the problems. ICBF (the Company) and its
subsidiary, Inland Community Bank, N.A. (the Bank) have chosen to limit their
involvement in these riskier lines of business, and the performance of the
Company as reported in the following pages demonstrates our ability to manage
these risks more effectively.
Although you will continue to hear about shrinking margins, asset quality
and other challenges in the banking industry, many well managed community
banks, unlike some regional and national banks, will be able to survive and
thrive in the current environment.
The keys to continued success in this economy will be asset quality,
liquidity, capital and the transparency to keep our shareholders and customers
informed about the Bank's progress as it navigates through these turbulent
times.
As you probably noted in the ICBF Annual Report for 2007, we have
increased the information available to shareholders about your investment so
that you will know the Company is taking the actions that are necessary to
control the increased operating risks in the current banking environment.
Banking regulators have recently identified liquidity risk and capital as
major concerns for all commercial banks. The Company has been most proactive
in formulating detailed plans and policies to mitigate the effects of
liquidity risk and has detailed and tested liquidity sources to be used in the
early stages of a liquidity concern to the Bank. And as detailed in the Annual
Report the Bank continues to maintain its "well capitalized" status with the
regulators.
The Bank's asset quality is receiving additional Management attention with
past due and non-accrual loans increasing from 0.76% of total loans in June
2007 to 4.69% of total loans in June 2008. And recently, the Bank's
percentage of loans Classified and Criticized loans have decreased from 8.8%
of total loans in May of 2008 to 7.6% of total loans at the end of June.
These ratios have been a warning sign to Management and with a 20.5% year-
over-year increase in loans Senior Management and the Board have increased the
provision for credit related reserves substantially adding $480,000 to the
reserve in the first half of 2008. The balance in the Allowance for loan
losses has increased over 50% from $1,551M in June 2007 to $2,331M in June
2008.
Non-interest expenses have been reduced by more than 17% for the first
half of the year and are on track for a total reduction of 35% for all of
2008. These reductions in overhead expenses are important to the increased
profitability of the Bank and were implemented at an important time for the
Bank.
And finally the tangible book value per share increased to $5.40 per share
on June 30, 2008, an increase of 5.5% over June 30, 2007. This increase was
due in part to a successful stock repurchase program during the 2nd quarter of
2008 which reduced the number of shares outstanding by 356,450 shares or 6.5%;
the repurchase program was successfully completed in less than 30 days and
reduced capital by a little more than $2 million.
It is critically important in this environment that the investors and
customers of our Company are kept fully informed about every important aspect
of the Company's operations. In this regard we welcome any questions
concerning the Bank.
We are confident that the Bank and the Company are well positioned to
provide the proper sound financial service to our customers and depositors
over the years ahead. We thank you for your continued support and look
forward to being the "Business Bank that is Specifically Better and Different"
for many years to come.
James S. Cooper
President and Chief Executive Officer
ICB Financial
Consolidated Balance Sheets
Unaudited - Internally Prepared
(in thousands)
June 07 December
to to
June 08 June
As of As of As of Percentage As of Percentage
6/30/2008 6/30/2007 6/30/2006 Change 12/31/2007 Change
Assets
Total cash
and due
from banks
Noninterest-
bearing
balances,
coin and
currency $10,886 $12,069 $13,693 -9.8% $9,355 16.4%
Interest
bearing
balances 594 492 5,041 20.7% 13,103 -95.5%
Held to
maturity
securities -
HTM and AFS 8,465 11,445 21,564 -26.0% 9,431 -10.2%
Federal funds
sold 2,905 12,760 22,565 -77.2% 7,885 -63.2%
Loans and lease
financing -
Available for
Sale 7,676 - - 100.0% - 0.0%
Loans and lease
financing
receivables
Loans, net
of unearned
income 201,248 173,314 110,030 16.1% 188,690 6.7%
Less:
Allowance
for loan
losses (2,331) (1,551) (1,604) 50.3% (1,895) 23.0%
Net loans 198,917 171,763 108,426 15.8% 186,795 6.5%
Premises and
fixed assets
- net 10,191 10,423 9,756 -2.2% 10,282 -0.9%
Other real
estate owned 622 - - 100.0% 600 3.7%
Intangible assets
Goodwill 2,280 2,280 1,550 0.0% 2,280 0.0%
Core deposit
intangibles 1,245 1,693 2,255 -26.5% 1,396 -10.8%
Other assets 9,147 7,855 4,878 16.4% 9,053 1.0%
Total Assets $252,928 $230,780 $189,728 9.6% $250,180 1.1%
Liabilities and
Capital
Deposits
Noninterest-
bearing $65,158 $64,168 $62,531 1.5% $68,177 -4.4%
Interest
bearing 135,080 133,423 97,235 1.2% 147,315 -8.3%
Total deposits 200,238 197,591 159,766 1.3% 215,492 -7.1%
Borrowings 20,500 - - 0.0% - 0.0%
Other
liabilities 1,128 1,450 975 -22.2% 2,277 -50.5%
Total
liabilities 221,866 199,041 160,741 11.5% 217,769 1.9%
Equity capital
Common stock 5,106 5,417 5,418 -5.7% 5,459 -6.5%
Surplus 21,608 23,147 21,230 -6.6% 23,239 -7.0%
Retained
earnings 4,381 3,181 2,339 37.7% 3,721 17.7%
Accumulated
other
comprehensive
income (loss) (33) (6) - 450.0% (8) 312.5%
Total Equity
Capital 31,062 31,739 28,987 -2.1% 32,411 -4.2%
Total Liabilities
and Equity
Capital $252,928 $230,780 $189,728 9.6% $250,180 1.1%
Unaudited - Internally Prepared
(in thousands,
except
percentages) June 07 2nd 2nd June 07
6 months 6 Months to Quarter Quarter to
ended ended June 08 ended ended June 08
Percentage Percentage
6/30/2008 6/30/2007 Change 6/30/2008 6/30/2007 Change
Interest
Income on:
Total interest
and fees on
loans $7,087 $6,518 8.7% $3,460 $3,395 1.9%
Interest on
investment
securities 192 283 -32.2% 93 134 -30.6%
Interest on
federal funds
sold 74 289 -74.4% 30 175 -82.9%
Other interest
income 183 88 108.0% 52 31 67.7%
Total interest
income 7,536 7,178 5.0% 3,635 3,735 -2.7%
Interest Expense:
Interest paid
on deposits 2,165 1,858 16.5% 980 1,041 -5.9%
Interest paid
on borrowings 118 - - 118 -
Total interest
expense 2,283 1,858 22.9% 1,098 1,041 5.5%
Net interest
income $5,253 $5,320 -1.3% $2,537 $2,694 -5.8%
Provision for
Possible Loan
Losses and OBS
reserve 480 75 540.0% 264 75 252.0%
Net Interest
Income after
ALLL Provision 4,773 5,245 -9.0% 2,273 2,619 -13.2%
Total non-interest
income 719 726 -1.0% 303 181 67.4%
Total non-interest
expense 4,377 5,300 -17.4% 2,217 2,752 -19.4%
Income before
income taxes 1,115 671 66.2% 359 48 647.9%
Applicable
income taxes 419 241 73.9% 138 (9) -1633.3%
Net income $696 $430 61.9% $221 $57 287.7%
Per Common Share
Data
Earnings
per share
- basic 0.13 0.08 62.5% 0.04 0.01 300.0%
Earnings
per share
- diluted 0.13 0.08 62.5% 0.04 0.01 300.0%
Shares
outstanding
- (actual) 5,106,346 5,422,605 -5.8% 5,106,346 5,422,605 -5.8%
Weighted
Average
Shares
Outstanding 5,284,146 5,422,605 -2.6% 5,109,496 5,422,605 -5.8%
Shares
outstanding
- (fully
diluted) 5,440,546 5,583,005 -2.6% 5,265,946 5,583,005 -5.7%
Financial Ratios
Return on
Average
Assets 0.60% 0.46% 30.4% 0.18% 0.11% 61.2%
Return on
Average
Equity 4.38% 2.70% 62.2% 2.83% 0.72% 294.8%
Net interest
margin 4.81% 4.70% 2.3% 4.53% 4.70% -3.6%
Efficiency ratio 73.3% 87.7% -16.4% 78.1% 95.7% -18.4%
Total Revenue
per employee
(annualized
-actual) $195,803 $145,687 34.4% $186,230 $138,554 34.4%
Loan to
deposit
ratio 103.0% 87.0% 18.4% 103.0% 87.0% 18.4%
ALLL as a
percent
of Total Loans
(Includes
OBS reserve) 1.20% 0.94% 27.7% 1.16% 0.94% 23.4%
Past due and
Non-accrual
loans-in
thousands $9,845 $1,324 643.6% $9,845 $1,324 643.6%
Past due and
non-accrual
loans as a
percent of
total loans 4.71% 0.90% 423.3% 4.69% 0.76% 517.1%
Past due and
non-accrual
loans as a
percent of
total assets 3.89% 0.57% 578.5% 3.89% 0.57% 582.5%
Book value per
share $6.09 $5.85 4.1% $6.08 $5.85 3.9%
Tangible book
value per share $5.40 $5.12 5.5% $5.39 $5.12 5.3%
For further information, please contact Thomas O. Griel of ICB Financial,
+1-909-481-8706, Ext. 271
SOURCE ICB Financial
Thomas O. Griel of ICB Financial, +1-909-481-8706, Ext. 271
