/EINPresswire.com/ -- SOUTH SAN FRANCISCO, CA--(Marketwired - Jul 24, 2017) - FNB Bancorp (NASDAQ: FNBG), parent company of First National Bank of Northern California (the "Bank"), today announced net earnings available to common stockholders for the second quarter of 2017 of $3,351,000 or $0.44 per diluted share, compared to net earnings available to common shareholders of $2,448,000 or $0.33 per diluted share for the second quarter of 2016.
During the second quarter of 2017, our net interest income was $11.4 million, an increase of $882,000 from the second quarter of 2016. This increase was primarily the result of an increase in the average volume of our interest earning assets outstanding partially offset by a slight reduction in our earning rate when compared to the same period in 2016.
"During the second quarter of 2017, the Company was able to grow our net loan portfolio by $1.3 million. Loan production was strong during the first half of the quarter, however, commercial real estate loan prepayments during June lowered our overall loan portfolio growth rate. During the quarter, our deposit balances decreased by $3 million, however, we were able to grow our non-interest bearing DDA account balances by $9 million. The growth in loans and the reduction in the overall deposit balances was funded by an increase in short term FHLB borrowings of $5 million. Net interest income was helped by the fact that the adjustable rate portion of our loan portfolio has begun to reset to higher yields, in response to increases to short term rates by the Federal Open Market Committee and increases in the short term LIBOR rates. The current low rate environment has put pressure on our net interest margin, but we have added enough interest earning assets at spreads that have allowed us to expand our net interest income at an acceptable rate. Our net interest margin was 3.93% for the second quarter and our increased earnings coupled with a flattening yield curve have allowed our capital base to increase by over $4 million during the quarter. We worked hard during the second quarter to improve our profitability while continuing to provide for our customers' needs and provide them with the products they want delivered in an efficient and effective manner," stated CEO Tom McGraw.
"Our total non-accrual loans balance decreased by $1 million during the second quarter. This decrease was the result of management efforts to reduce the levels of our non-accrual loans. We utilize a conservative underwriting approach in our loan origination process which should serve to keep problem loans at acceptable levels as we work to prudently increase the size of our loan portfolio. There was a $140,000 recovery of provision for loan losses during the second quarter that was related to improving credit characteristics in our loan portfolio," continued Tom McGraw.
FNB Bancorp and Subsidiary
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollar and share amounts in thousands, except earnings per share)
As of
June 30,
2017
2016
ASSETS
Cash and due from banks
$
21,859
$
20,564
Interest-bearing time deposits with financial institutions
230
205
Securities available for sale, at fair value
362,006
342,420
Other equity securities
7,567
7,206
Loans, net of deferred loan fees and allowance for loan losses
808,508
725,471
Bank premises, equipment and leasehold improvements, net
9,416
10,114
Bank owned life insurance
16,438
16,050
Accrued interest receivable
4,945
4,547
Other real estate owned
1,459
1,247
Goodwill
4,580
4,580
Prepaid expenses
621
783
Other assets
16,032
15,393
TOTAL ASSETS
$
1,253,661
$
1,148,580
LIABILITIES
Deposits:
Demand, noninterest bearing
$
296,249
$
267,593
Demand, interest bearing
129,435
112,591
Savings and money market
472,050
508,605
Time
124,604
118,700
Total Deposits
1,022,338
1,007,489
Federal Home Loan Bank advances
91,000
7,000
Note payable
4,050
4,650
Accrued expenses and other liabilities
17,546
17,026
Total Liabilities
1,134,934
1,036,165
STOCKHOLDERS' EQUITY
Common stock, no par value:
85,159
75,944
Retained earnings
32,306
31,424
Accumulated other comprehensive earnings, net of tax
1,262
5,047
Total Stockholders' Equity
118,727
112,415
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$
1,253,661
$
1,148,580
FNB Bancorp and Subsidiary
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollar and share amounts in thousands, except earnings per share)
(Unaudited)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2017
2016
2017
2016
INTEREST INCOME
Interest and fees on loans
$
10,370
$
9,563
$
20,443
$
19,434
Interest on dividends and securities
1,989
1,731
3,932
3,416
Interest on deposits with other financial institutions
19
22
30
31
Total interest income
12,378
11,316
24,405
22,881
INTEREST EXPENSE
Deposits
677
709
1,313
1,492
Federal Home Loan Bank advances
214
1
360
9
Interest on note payable
55
56
108
113
Total interest expense
946
766
1,781
1,614
NET INTEREST INCOME
11,432
10,550
22,624
21,267
(Recovery of) provision for loan losses
(140
)
75
(140
)
150
NET INTEREST INCOME AFTER (RECOVERY OF) PROVISION FOR LOAN LOSSES
11,572
10,475
22,764
21,117
NONINTEREST INCOME
Service charges
564
618
1,161
1,239
Net gain on sale of available-for-sale securities
123
57
151
241
Earnings on bank owned life insurance
88
105
190
205
Other income
237
256
520
485
Total Noninterest Income
1,012
1,036
2,022
2,170
NONINTEREST EXPENSES
Salaries and employee benefits
4,862
4,876
9,636
9,814
Occupancy expense
707
617
1,358
1,248
Equipment expense
406
438
808
872
Professional fees
408
294
881
681
FDIC assessment
90
150
220
300
Telephone, postage, supplies
325
306
622
601
Advertising expense
107
183
215
300
Data processing expense
144
140
283
332
Low income housing expense
123
71
228
142
Surety insurance
89
87
173
174
Director fees
72
72
144
144
Other real estate owned expense (recovery), net
7
-
17
(10
)
Other expenses
338
415
698
838
Total Noninterest Expense
7,678
7,649
15,283
15,436
EARNINGS BEFORE PROVISION FOR INCOME TAXES
4,906
3,862
9,503
7,851
Provision for income taxes
1,555
1,414
3,063
2,836
NET EARNINGS AVAILABLE TO COMMON STOCKHOLDERS
$
3,351
$
2,448
$
6,440
$
5,015
Per Share Data:
Basic earnings per share available to common stockholders
$
0.46
$
0.34
$
0.88
$
0.70
Diluted earnings per share available to common stockholders
$
0.44
$
0.33
$
0.85
$
0.68
Cash dividends declared
$
882
$
686
$
1,661
$
1,369
Average shares outstanding
7,342
7,216
7,329
7,194
Average diluted shares outstanding
7,585
7,393
7,559
7,390
Shares outstanding as of the end of period
7,362
7,255
7,362
7,255
FNB Bancorp and Subsidiary
FINANCIAL HIGHLIGHTS
(Dollar and share amounts in thousands, except earnings per share)
(Unaudited)
(Unaudited)
Three Months Ended
Six Months Ended
March 31,
June 30,
2017
2016
2017
2016
AVERAGE BALANCES:
Total Assets
$
1,256,608
$
1,156,072
$
1,244,943
$
1,151,283
Total Loans
830,318
740,097
819,030
741,689
Total Earning Assets
1,191,820
1,091,162
1,180,119
1,086,925
Total Deposits
1,022,838
1,024,736
1,017,952
1,018,502
Total Stockholder's Equity
115,720
109,064
113,551
107,642
SELECTED PERFORMANCE DATA
Annualized return on average assets
1.07
%
0.85
%
0.52
%
0.87
%
Annualized return on average equity
11.58
%
8.98
%
5.67
%
9.32
%
Net interest margin (taxable equivalent)
3.93
%
3.98
%
3.95
%
4.03
%
Average loans as a percent of average deposits
81.18
%
72.22
%
80.46
%
72.82
%
Average total stockholders' equity as a % of average total assets
9.21
%
9.43
%
9.12
%
9.35
%
Annualized common dividend payout ratio
26.32
%
28.02
%
25.79
%
27.30
%
NON-PERFORMING ASSETS
(Extracted from
(Dollars In Thousands)
audited annual
(Unaudited)
(Unaudited)
financial statements)
(Unaudited)
(Unaudited)
June 30,
March 31,
December 31,
September 30,
June 30,
2017
2017
2016
2016
2016
Non-accrual loans
$
7,363
$
8,444
$
6,647
$
6,903
$
8,182
Other real estate owned
1,459
1,443
1,427
1,346
1,247
Total non-performing assets
$
8,822
$
9,887
$
8,074
$
8,249
$
9,429
Loan loss reserve
$
10,177
$
10,144
$
10,167
$
10,092
$
10,038
Non-accrual loans/Gross loans
1.02
%
1.03
%
0.84
%
0.92
%
1.11
%
Loan loss reserves/Gross loans
1.41
%
1.24
%
1.28
%
1.34
%
1.36
%
FNB Bancorp and Subsidiary
CONSOLIDATED BALANCE SHEETS
(Dollar and share amounts in thousands, except earnings per share)
(Extracted from
audited annual
(Unaudited)
(Unaudited)
financial statements)
(Unaudited)
(Unaudited)
June 30,
March 31,
December 31,
September 30,
June 30,
2017
2017
2016
2016
2016
ASSETS
Cash and due from banks
$
21,859
$
25,337
$
15,758
$
17,342
$
20,564
Interest-bearing time deposits with financial institutions
230
205
205
204
205
Securities available for sale, at fair value
362,006
353,364
360,105
358,877
342,420
Other equity securities
7,567
7,211
7,206
7,206
7,206
Loans, net of deferred loan fees and allowance for loan losses
808,508
807,191
782,485
741,407
725,471
Bank premises, equipment and leasehold improvements, net
9,416
9,571
9,837
9,918
10,114
Bank owned life insurance
16,438
16,349
16,247
16,145
16,050
Accrued interest receivable
4,945
4,785
4,942
4,544
4,547
Other real estate owned
1,459
1,443
1,427
1,346
1,247
Goodwill
4,580
4,580
4,580
4,580
4,580
Prepaid expenses
621
768
856
670
783
Other assets
16,032
15,917
15,746
15,309
15,393
TOTAL ASSETS
$
1,253,661
$
1,246,721
$
1,219,394
$
1,177,548
$
1,148,580
LIABILITIES
Deposits:
Demand, noninterest bearing
$
296,249
$
287,029
$
296,273
$
285,767
$
267,593
Demand, interest bearing
129,435
125,643
121,086
110,147
112,591
Savings and money market
472,050
496,697
487,763
491,047
508,605
Time
124,604
115,622
114,384
116,496
118,700
Total Deposits
1,022,338
1,024,991
1,019,506
1,003,457
1,007,489
Federal Home Loan Bank advances
91,000
86,000
71,000
37,000
7,000
Note payable
4,050
4,200
4,350
4,500
4,650
Accrued expenses and other liabilities
17,546
17,198
14,224
18,847
17,026
Total Liabilities
1,134,934
1,132,389
1,109,080
1,063,804
1,036,165
STOCKHOLDERS' EQUITY
Common stock, no par value:
85,159
84,603
84,283
76,065
75,944
Retained Earnings
32,306
29,842
27,577
33,123
31,424
Accumulated other comprehensive earnings (losses), net of tax
1,262
(113
)
(1,546
)
4,556
5,047
Total Stockholders' Equity
118,727
114,332
110,314
113,744
112,415
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$
1,253,661
$
1,246,721
$
1,219,394
$
1,177,548
$
1,148,580
FNB Bancorp and Subsidiary
CONSOLIDATED STATEMENTS OF INCOME
(Dollar and share amounts in thousands, except earnings per share)
(Unaudited)
Three Months Ended
June 30,
March 31,
December 31,
September 30,
June 30,
2017
2017
2016
2016
2016
INTEREST INCOME
Interest and fees on loans
$
10,370
$
10,073
$
9,578
$
9,301
$
9,563
Interest on dividends and securities
1,989
1,943
1,925
1,815
1,731
Interest on deposits with other financial institutions
19
11
7
6
22
Total interest income
12,378
12,027
11,510
11,122
11,316
INTEREST EXPENSE
Deposits
677
637
631
657
709
Federal Home Loan Bank advances
214
145
48
10
1
Interest on note payable
55
53
55
54
56
Total interest expense
946
835
734
721
766
NET INTEREST INCOME
11,432
11,192
10,776
10,401
10,550
(Recovery of) provision for loan losses
(140
)
-
-
-
75
NET INTEREST INCOME AFTER (RECOVERY OF) PROVISION FOR LOAN LOSSES
11,572
11,192
10,776
10,401
10,475
NONINTEREST INCOME
Service charges
564
597
599
623
618
Net gain on sale of available-for-sale securities
123
28
57
140
57
Earnings on bank owned life insurance
88
102
102
94
105
Other income
237
283
565
245
256
Total Noninterest Income
1,012
1,010
1,323
1,102
1,036
NONINTEREST EXPENSES
Salaries and employee benefits
4,862
4,774
4,839
4,821
4,876
Occupancy expense
707
651
635
645
617
Equipment expense
406
402
448
445
438
Professional fees
408
473
384
298
294
FDIC assessment
90
130
150
150
150
Telephone, postage, supplies
325
297
298
300
306
Advertising expense
107
108
120
104
183
Data processing expense
144
139
178
147
140
Low income housing expense
123
105
71
71
71
Surety insurance
89
84
85
88
87
Director fees
72
72
72
72
72
Other real estate owned expense, net
7
10
5
-
-
Other expenses
338
360
458
372
415
Total Noninterest Expense
7,678
7,605
7,743
7,513
7,649
EARNINGS BEFORE PROVISION FOR INCOME TAXES
4,906
4,597
4,356
3,990
3,862
Provision for income taxes
1,555
1,508
1,314
1,546
1,414
NET EARNINGS AVAILABLE TO COMMON STOCKHOLDERS
$
3,351
$
3,089
$
3,042
$
2,444
$
2,448
FNB Bancorp and Subsidiary
(Dollar and share amounts in thousands, except earnings per share)
(Unaudited)
Three Months Ended
June 30,
March 31,
December 31,
September 30,
June 30,
2017
2017
2016
2016
2016
Per Share Data:
Basic earnings per share available to common stockholders
$
0.46
$
0.42
$
0.42
$
0.34
$
0.34
Diluted earnings per share available to common stockholders
$
0.44
$
0.41
$
0.41
$
0.33
$
0.33
Cash dividends declared
$
882
$
780
$
739
$
738
$
686
Average shares outstanding
7,342
7,301
7,275
7,263
7,216
Average diluted shares outstanding
7,585
7,518
7,461
7,428
7,393
Shares outstanding as of end of period
7,362
7,311
7,280
7,269
7,255
SELECTED PERFORMANCE DATA
Annualized return on average assets
1.07
%
1.00
%
1.02
%
0.84
%
0.85
%
Annualized return on average equity
11.58
%
11.24
%
10.88
%
8.69
%
8.98
%
Net interest margin (taxable equivalent)
3.93
%
3.98
%
3.89
%
3.88
%
3.96
%
Average loans as a percent of average deposits
81.18
%
79.73
%
75.01
%
72.96
%
72.22
%
Average total stockholders' equity as a % of average total assets
9.21
%
8.91
%
9.38
%
9.70
%
9.43
%
Annualized common dividend payout ratio
26.32
%
25.25
%
24.29
%
30.20
%
28.02
%
(Extracted from
LOANS
audited annual
(Dollars in thousands)
(Unaudited)
(Unaudited)
financial statements)
(Unaudited)
(Unaudited)
June 30,
March 31,
December 31,
September 30,
June 30,
2017
2017
2016
2016
2016
Real estate loans:
Construction
$
46,325
$
49,490
$
43,683
$
38,162
$
29,251
Commercial
369,657
432,301
421,222
404,841
398,290
Multi family
90,733
112,911
105,963
83,946
82,637
Residential
150,546
169,373
170,523
173,476
174,084
Commercial & industrial loans
54,102
49,277
48,874
50,967
51,366
Consumer loans
8,884
6,065
3,533
1,630
1,311
Gross loans
720,247
819,417
793,798
753,022
736,939
Net deferred loan fees
(1,010
)
(1,076
)
(1,146
)
(1,523
)
(1,430
)
Allowance for loan losses
(10,177
)
(10,144
)
(10,167
)
(10,092
)
(10,038
)
NET LOANS
$
709,060
$
808,197
$
782,485
$
741,407
$
725,471
Cautionary Statement: This release contains certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those stated herein. Management's assumptions and projections are based on their anticipation of future events and actual performance may differ materially from those projected. Risks and uncertainties which could impact future financial performance include, among others, (a) competitive pressures in the banking industry; (b) changes in the interest rate environment; (c) general economic conditions, either nationally or regionally or locally, including fluctuations in real estate values; (d) changes in the regulatory environment; (e) changes in business conditions or the securities markets and inflation; (f) possible shortages of gas and electricity at utility companies operating in the State of California, and (g) the effects of terrorism, including the events of September 11, 2001, and thereafter, and the conduct of war on terrorism by the United States and its allies. Therefore, the information set forth herein, together with other information contained in the periodic reports filed by FNB Bancorp with the Securities and Exchange Commission, should be carefully considered when evaluating its business prospects. FNB Bancorp undertakes no obligation to update any forward-looking statements contained in this release.
Contacts:
Tom McGraw
Chief Executive Officer
(650) 875-4864
Dave Curtis
Chief Financial Officer
(650) 875-4862