FRESNO, Calif., Nov. 3 /PRNewswire-FirstCall/ -- Dennis R. Woods,
President and Chief Executive Officer of United Security Bancshares
http://www.unitedsecuritybank.com/ (NASDAQ:UBFO) reported today the
results of operations for the 3rd quarter and nine months ended
September 30, 2009. The net income was $693,000 for the 3rd quarter
of 2009, as compared with a net loss of ($1,342,000) for the 3rd
quarter in 2008. Basic and diluted earnings per share for the 3rd
quarter 2009 were $.06 compared with basic and diluted of ($0.11)
for the 3rd quarter 2008. For the nine months ended September 30,
2009, the net loss was ($4,112,000) compared with net income of
$3,228,000 in 2008. For the 3rd quarter 2009, return on average
equity was 3.64% and the return on average assets 0.38% compared
with a return on average equity was (6.48%) and the return on
average assets was (0.68%) for the 3rd quarter 2008. For the nine
months ended September 30, 2009, return on average equity was
(6.95%) and the return on average assets was (.74%). For the same
period in 2008, return on average equity was 5.18% and return on
average assets was .56%. Shareholders' equity at quarter end was
$76.7 million. The Board of Directors of United Security Bancshares
declared a 4th quarter 2009 stock dividend of one percent (1%). The
stock dividend replaces the quarterly cash dividend. The stock
dividend is payable to shareholders of record on October 9, 2009
and shares were issued on October 21, 2009. Woods added, "We are
seeing the fruits of significant efforts over the past 12 months,
after taking control of and completing various requirements to
prepare properties for sale. During the third quarter 15 properties
related to nonperforming assets sold for total proceeds of $9.5
million after additional write-downs and (gains)/losses of $459,000
during the 3rd quarter. Since the end of the 3rd quarter through
the date of this announcement, 21 properties associated with
nonperforming assets closed escrow for total proceeds of $11.5
million after loss of $1,476 on sale of OREO property. Escrows are
open on other 14 properties associated with nonperforming assets
scheduled to close by November 20, 2009 for additional total
proceeds of $10.1 million after estimated write-downs and
(gains)/losses of $358,000 on such properties to be taken in the
4th quarter. (Write-downs and (gains)/losses do not include certain
carrying costs such as property taxes, repairs, maintenance, costs
to prepare properties for sale and similar expenses)." "Our focused
and disciplined approach provides our customers with as much
assistance as possible during difficult times while we attempt to
avoid contributing to further job loss and property value declines,
often associated with ill timed liquidations. We understand, if
your neighbors' property is liquidated in a forced sale, your
property drops in value and we work to minimize that whenever
possible." "Our employees have a strong commitment to an approach
that benefits customers and shareholders alike and parallels our
commitment to provide excellent bank services in the communities we
serve. Our business plan reduces nonperforming assets, adds to our
strong capital base while providing customers with more options.
Fortunately, strong core earnings allow us greater flexibility for
accomplishing these goals." Net interest income for the 3rd quarter
2009 was $7.16 million, down $267,000 from the 3rd quarter of 2008
for a decrease of 3.6%. The net interest margin increased from
4.17% in the 3rd quarter 2008 to 4.61% in 2009. For the nine months
ended September 30, 2009 net interest income was $21,102,000, down
$2,038,000 from $23,140,000 for the same period in 2008 for an
8.81% decline. The net interest margin was 4.44% for the nine month
period ended September 30, 2008 and 4.46% for the same period in
2009. Noninterest income for the 3rd quarter of 2009 was
$1,019,000, down $572,000 from $1,591,000 in 2008 for a decrease of
35.9%. For the nine months ended September 30, 2009, noninterest
income was $3,438,000, down $2,208,000 from $5,645,000 for the same
period in 2008. The largest single noninterest income component
within the nine month periods was gain/loss on sale of OREO
properties that reduced noninterest income in 2009 by $822,000.
Other operating expenses for the three months ended September 30,
2009 were $6,850,000 and $5,224,000 for 2008, an increase of
$1,626,000 or 31.1%. For the nine months ended September 30, 2009,
other operating expenses totaled $21,613,000, up $4,532,000 from
$17,081,000 for the same period in 2008. Five expense components
accounted for the much of differences for the nine month period. 1)
FDIC assessments increased by $487,000, 2) write-downs on
foreclosed properties were up $835,000, 3) foreclosed property
expenses were up $939,000, 4) sundry losses associated with a
lawsuit were up $788,000 and 5) a goodwill impairment expense was
up $3,026,000 in 2009 over 2008. The provision for loan loss was
$436,000 for the 3rd quarter of 2009 and $6,444,000 for 3rd quarter
of 2008. For the nine months ended September 30, 2009, the
provision was $8,593,000 compared with $7,160,000 for the same
period in 2008. In determining the adequacy of the allowance for
loan losses, Management's judgment is the primary determining
factor for establishing the amount of the provision for loan losses
and management considers the allowance for loan and lease losses at
September 30, 2009 to be adequate. Non-performing assets decreased
to 12.43% of total assets on September 30, 2009 from 12.62% on June
30, 2009. At year-end 2008 non-performing assets were 10.78% of
total assets and on June 30, 2008 6.83%. United Security Bancshares
is a $720+ million bank holding company. United Security Bank, its
principal subsidiary is a state chartered bank and member of the
Federal Reserve Bank of San Francisco. FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended
and the Company intends such statements to be covered by the safe
harbor provisions for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are based on management's knowledge and belief as of
today and include information concerning the Company's possible or
assumed future financial condition, and its results of operations,
business and earnings outlook. These forward-looking statements are
subject to risks and uncertainties. A number of factors, some of
which are beyond the Company's ability to control or predict, could
cause future results to differ materially from those contemplated
by such forward-looking statements. These factors include (1)
changes in interest rates, (2) significant changes in banking laws
or regulations, (3) increased competition in the company's market,
(4) other-than-expected credit losses, (5) earthquake or other
natural disasters impacting the condition of real estate
collateral, (6) the effect of acquisitions and integration of
acquired businesses, (7) the impact of proposed and/or recently
adopted changes in regulatory, judicial, or legislative tax
treatment of business transactions, particularly recently enacted
California tax legislation and the subsequent Dec. 31, 2003,
announcement by the Franchise Tax Board regarding the taxation of
REITs and RICs; and (8) unknown economic impacts caused by the
State of California's budget issues. Management cannot predict at
this time the severity or duration of the effects of the recent
business slowdown on our specific business activities and
profitability. Weaker or a further decline in capital and consumer
spending, and related recessionary trends could adversely affect
our performance in a number of ways including decreased demand for
our products and services and increased credit losses. Likewise,
changes in interest rates, among other things, could slow the rate
of growth or put pressure on current deposit levels and affect the
ability of borrowers to repay loans. Forward-looking statements
speak only as of the date they are made, and the company does not
undertake to update forward-looking statements to reflect
circumstances or events that occur after the date the statements
are made, or to update earnings guidance including the factors that
influence earnings. For a more complete discussion of these risks
and uncertainties, see the Company's Annual Report on Form 10-K for
the year ended December 31, 2008, and particularly the section of
Management's Discussion and Analysis. United Security Bancshares
Consolidated Balance Sheets (unaudited) (Dollars in thousands)
September September 30 30 2009 2008 ---- ---- Cash &
nonint.-bearing deposits in banks $22,274 $17,872 Interest-bearing
deposits in banks 2,526 15,101 Federal funds sold 0 0 Investment
securities AFS 80,754 96,324 Loans, net of unearned fees 533,252
600,787 Less: allowance for loan losses (14,413) (12,580) -------
------- Loans, net 518,840 588,207 Premises and equipment, net
13,362 14,599 Intangible assets 9,664 13,677 Other assets 74,406
42,222 ------ ------ TOTAL ASSETS $721,825 $788,002 Deposits:
Noninterest-bearing demand & NOW 176,657 197,004 Savings &
Money Market 167,493 178,129 Time 227,920 227,151 ------- -------
Total deposits 572,070 602,284 Borrowed funds 54,360 86,809 Other
liabilities 7,186 6,275 Junior subordinated debentures 11,510
12,783 ------ ------ TOTAL LIABILITIES $645,127 $708,151
Shareholders' equity: Common shares outstanding: 12,372,797 at Sep.
30, 2009 11,914,838 at Sep. 30, 2008 $36,987 $33,587 Retained
earnings 41,498 48,307 Fair Value Adjustment - Hedge 0 0
Accumulated other comprehensive income (1,787) (2,043) ------
------ Total shareholders' equity $76,698 $79,851 ------- -------
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY 721,825 788,002 United
Security Bancshares Consolidated Statements of Three Three Nine
Nine Income Months Months Months Months (dollars in 000's, except
Ended Ended Ended Ended per share amounts) 30-Sep 30-Sep 30-Sep
30-Sep (unaudited) ------ ------ ------ ------ 2009 2008 2009 2008
---- ---- ---- ---- Interest income $8,870 $10,936 $26,824 $35,111
Interest expense 1,711 3,509 5,722 11,971 ----- ----- ----- ------
Net interest income 7,159 7,427 21,102 23,140 Provision for loan
losses 436 6,444 8,593 7,160 Other income 1,019 1,591 3,438 5,645
Other expenses 6,850 5,224 21,613 17,081 ----- ----- ------ ------
Income before income tax provision 894 (2,650) (5,667) 4,544
Provision for income taxes 200 (1,308) (1,555) 1,316 --- ------
------ ----- NET INCOME $693 ($1,342) ($4,112) $3,228 United
Security Bancshares Selected Financial Data Three Three Nine Nine
(dollars in 000's except per Months Months Months Months share
amounts) Ended Ended Ended Ended 30-Sep-09 30-Sep-08 30-Sep-09
30-Sep-08 --------- --------- --------- --------- Basic Earnings
Per Share $0.06 ($0.11) ($0.33) $0.26 Diluted Earning Per Share
$0.06 ($0.11) ($0.33) $0.26 Annualized Return on: Average Assets
0.38% (0.68%) (0.74%) 0.56% Average Equity 3.63% (6.48%) (6.95%)
5.18% Net Interest Margin 4.61% 4.17% 4.46% 4.44% Net Charge-offs
to Average Loans 1.70% 1.01% 1.52% 0.46% 30-Sep-09 30-Sep-08
--------- --------- Book Value Per Share $6.20 $6.70 Tangible Book
Value Per Share $5.42 $5.55 Efficiency Ratio 88.08% 59.15% Non
Performing Assets to Total Assets 12.43% 8.09% Allowance for Loan
Losses to Total Loans 2.70% 2.09% Shares Outstanding - period end
12,372,797 11,914,838 Basic Shares - YTD average weighted
12,372,869 12,423,211 Diluted Shares - YTD average weighted
12,372,869 12,428,878 Basic Shares - QTD average weighted
12,372,797 12,399,402 Diluted Shares - QTD average weighted
12,372,797 12,406,222 DATASOURCE: United Security Bancshares
CONTACT: Dennis R. Woods, President and Chief Executive Officer of
United Security Bank, +1-559-248-4928 Web Site:
http://www.unitedsecuritybank.com/
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