1st Capital Bank (OTCBB: FISB): 1st Capital Bank, Monterey
County's award winning community bank, reported continued growth
for the first quarter ended March 31, 2012. The Bank reported an
increase in total assets of 31% to $291 million as of March 31,
2012, compared to $222 million for the same quarter one year ago.
Total loans grew to $202 million at March 31, 2012, a 10% increase
over the same quarter a year ago. The Bank remains focused on
growing its loan portfolio while maintaining its high quality. The
Bank's asset quality remained strong, with a ratio of nonperforming
loans to total loans of just 0.16% as of March 31, 2012, unchanged
from a year prior.
Total deposits grew to $258 million, which represents an
increase of $66 million, or 34% over the similar quarterly period
in 2011. 1st Capital Bank continued to grow its valuable mix of
"core" deposits, as demand and savings deposits were 84% of total
accounts as of March 31, 2012. This growth in deposits will be used
to fund future loan growth and other investments as soon
opportunities to prudently do so arise. In the interim, the excess
liquidity generated by the growth in deposits will continue to
compress the Bank's net interest margin until they are lent out at
the higher rates earned by loans. However, they will also continue
to add to the overall increase in earning assets and
profitability.
1st Capital Bank also reported net income before the provision
for income taxes of $537,000 for the quarter ended March 31, 2012
compared to $596,000 for the same period last year. After tax net
income of $310,000 for the quarter ended March 31, 2012 decreased
$286,000, compared to net income of $596,000 for the same quarter
in the previous year, as the Bank recorded a provision for income
taxes of $227,000 in the current year compared to none 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
$0.10 and $0.09, respectively, for the quarter ended March 31, 2012
compare to $0.19 and $0.18, respectively, for the first quarter a
year ago. Net interest income after the provision for loan losses
for the quarter ended March 31, 2012 increased $550,000 compared to
the same period a year ago. This increase was offset by an increase
in noninterest expenses of $620,000 as the Bank significantly
increased the strength of its infrastructure by hiring a number of
new staff and by expanding its Monterey branch operating
location.
"We are extremely pleased with the Bank's continued growth and
performance for the first quarter of 2012," stated President and
CEO Fred Rowden. "In 2010 the Bank reached a level of assets which
provided for sustained profitability, and in 2011 we continued that
growth along with a significant increase in earnings. When the
opportunity to invest for future and accelerated growth presented
itself, we decided to make that investment with the goal of
enhancing long-term profitability for the benefit of our
shareholders. This unique opportunity included acquiring proven
banking talent which will enable 1st Capital Bank to take advantage
of the changes that have occurred in our competitive environment.
As with any investment, the cost and expense typically arrives
before any potential benefit, and the increase in the Bank's
expenses in the 1st quarter reflects this. However, we believe that
it is always prudent stewardship to be looking forward, managing to
opportunities, and investing for the future," concluded Mr.
Rowden.
Key Performance Highlights of the First Quarter 2012
Results:
- Core deposit growth of $66 million, or 35%, over the first
quarter of 2011
- Continued strong quality loan growth of $19 million or 10% over
the first quarter of 2011
- 13% increase in net interest income
- Strong capital position with a total risk based capital ratio
of 17.3%
- Rated the Highest Performing Bank in Monterey County by the
Findley Reports based on 2011 financial performance
- New and expanded Monterey banking office opened on March 6,
2012
The Bank's Financial Summary for the quarter ended March 31,
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 of $310,000 for the quarter ended March 31, 2012
decreased $286,000 compared to net income of $596,000 for the same
quarter in the previous year, and increased $53,000 over the net
income for the trailing quarter ended December 31, 2011. Excluding
income tax expense, which was zero in 2011 due to the tax
accounting applied to the Bank in its start-up period, income
before taxes of $537,000 for the quarter ended March 31, 2012
compares to $596,000 for that period in the prior year. Basic and
fully diluted earnings per share for the three months ended March
31, 2012 were $0.10 and $0.09, respectively, compared to basic and
fully diluted earnings per share of $0.19 and $0.18, respectively,
for the same quarter in 2011 and $0.08 for both basic and fully
diluted earnings per share for the quarter ended December 31,
2011.
Total assets of $291 million as of March 31, 2012 increased $69
million (31%) from March 31, 2011 and increased $3 million (1%)
from December 31, 2011. Loans grew $19 million (10%) from March 31,
2011 to a total of $202 million as of March 31, 2012, with $1.4
million (1%) of that growth occurring in the three-month period
from December 31, 2011 to March 31, 2012. Loan growth was funded
largely by deposits, which grew $66 million (35%) from March 31,
2011 to a total of $258 million as of March 31, 2012, and increased
by $2.9 million (1%) from the balances outstanding as of December
31, 2011. It is not unusual for the Bank to experience softness in
loan and deposit growth during the first quarter of each year as
our customers finalize tax returns and work through a period of
seasonally reduced credit demand.
Net interest income after the provision for loan losses for the
quarter ended March 31, 2012 was $2.7 million, an increase of
$550,000 (26%) over the quarter ended March 31, 2011 and an
increase of $130,000 (5%) over the trailing quarter ended December
31, 2011.
Interest income for the quarter ended March 31, 2012 was $2.9
million, an increase of $272,000 (10%) over the quarter ended March
31, 2011 and a decrease of $20,000 (1%) below the trailing quarter
ended December 31, 2011. Average earning assets for the quarter
ended March 31, 2012 were $269 million, an increase of $58 million
(27%) compared to $211 million for the quarter ended March 31,
2011, and increased $30 million (12%) compared to $240 million for
the trailing quarter ended December 31, 2011.
Interest expense for the quarter ended March 31, 2012 was
$208,000, a decrease of $45,000 (18%) from the quarter ended March
31, 2011 and an increase of $6,000 (3%) from the trailing quarter
ended December 31, 2011. Average interest bearing liabilities for
the quarter ended March 31, 2012 were $152 million, an increase of
$17 million (13%) compared to $135 million for the quarter ended
March 31, 2011 and an increase of $16 million (12%) compared to
$136 million for the trailing quarter ended December 31, 2011.
While average balances of interest-bearing deposit liabilities as
of March 31, 2012 increased compared to March 31, 2011, interest
expense decreased due to the repricing of interest-bearing
deposits, reflecting the lower interest rate environment. Average
noninterest bearing deposits of $95 million grew $42 million (79%)
and $14 million (17%) compared to the quarters ended March 31, 2011
and December 31, 2011, 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 March 31, 2012 of 4.1%
compared to 4.6% for the quarter ended March 31, 2011. This
decrease, and the decrease from the 4.5% recorded for the trailing
quarter ended December 31, 2011, are 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 has remained
steady at 5.6% and the Bank continued to reduce overall deposits
costs from 0.54% and 0.38% for the three month periods ended March
31, 2011 and December 31, 2011, respectively, to 0.34% for the
period ended March 31, 2012.
1st Capital Bank recorded a provision for loan losses of $40,000
during the quarter ended March 31, 2012 compared to $273,000 in the
quarter ended March 31, 2011 and $196,000 in the trailing quarter
ended December 31, 2011. The ratio of the allowance for loan losses
to total loans outstanding was 1.67% at March 31, 2012 compared to
1.64% and 1.66% at March 31, 2011 and December 31, 2011,
respectively. The Bank's asset quality remained very strong, with a
ratio of impaired and nonperforming loans to total loans of just
0.16% as of March 31, 2012. The Bank has never had any real estate
acquired through foreclosure.
Noninterest income increased $11,000 (41%) to $38,000 for the
quarter ended March 31, 2012 compared to the quarter ended March
31, 2011 and decreased $4,000 (10%) compared to the trailing
quarter ended December 31, 2011, largely due to changes in the
outstanding balances of non-interest bearing deposits.
Noninterest expenses increased by $620,000 (40%) to $2.2 million
for the quarter ended March 31, 2012 compared to the quarter ended
March 31, 2011 and increased $29,000 (1%) compared to the trailing
quarter ended December 31, 2011. The majority of this increase was
due to the overall growth of the Bank and the investment of the
Bank in key personnel and enhanced facilities. 1st Capital Bank has
added nine new employees within the last twelve months,
representing a 20% increase in full-time-equivalent employees, with
six of those additions occurring during the last six months. The
Bank also moved its Monterey Branch and loan operations into new,
larger facilities during the first quarter of 2012.
No tax provision was recorded for the quarter ended March 31,
2011 compared to a provision for income taxes of $227,000 during
the quarter ended March 31, 2012.
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.1stcapitalbank.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
March 31,
Statement of Income Data 2012 2011
------------ ------------
Interest income
Loans (including fees) $ 2,779 $ 2,527
Investment securities 103 106
Other 42 19
------------ ------------
Total interest income 2,924 2,652
------------ ------------
Interest expense
Interest on deposits 208 253
Other - -
------------ ------------
Total interest expense 208 253
------------ ------------
Net interest income 2,716 2,399
Provision for loan losses (40) (273)
------------ ------------
Net interest income after provision for loan
losses 2,676 2,126
Noninterest income
Service charges on deposits 22 13
Other 16 14
------------ ------------
Total noninterest income 38 27
Noninterest expenses
Salaries and benefits 1,302 909
Occupancy 177 138
Furniture and equipment 95 77
Other 603 433
------------ ------------
Total noninterest expenses 2,177 1,557
------------ ------------
Income before provision for income taxes 537 596
Provision for income taxes 227 -
------------ ------------
Net income $ 310 $ 596
============ ============
Common Share Data
Earnings per share
Basic $ 0.10 $ 0.19
Diluted $ 0.09 $ 0.18
Weighted average shares outstanding
Basic 3,222,128 3,220,853
Diluted 3,308,773 3,221,916
Book value per share $ 9.92 $ 9.88
Tangible book value $ 9.92 $ 9.88
Shares outstanding 3,222,128 3,220,853
1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)
March December
Balance Sheet Data 2012 2011
---------- ----------
Assets
Cash and due from banks $ 5,674 $ 8,910
Federal funds sold and overnight deposits 55,417 60,062
Available-for-sale investment securities and
interest bearing deposits in other banks 26,116 17,520
Loans:
Commercial 78,484 78,504
Real estate-construction 3,845 4,126
Real estate-other 118,027 115,902
Consumer 1,146 1,580
Deferred loan costs, net 478 470
---------- ----------
Total loans 201,980 200,582
Allowance for loan losses (3,360) (3,320)
---------- ----------
Net loans 198,620 197,262
Premises and equipment, net 1,355 615
Accrued interest receivable and other assets 3,981 3,946
---------- ----------
Total assets $ 291,163 $ 288,315
========== ==========
Liabilities and Shareholders' Equity
Deposits:
Demand, noninterest bearing $ 90,466 $ 118,366
Demand, interest bearing 80,196 56,171
Savings 48,158 38,558
Time 39,677 42,488
---------- ----------
Total deposits 258,497 255,583
Accrued interest payable and other liabilities 468 919
Shareholders' equity 32,198 31,813
---------- ----------
Total liabilities and shareholders' equity $ 291,163 $ 288,315
========== ==========
Asset Quality
Loans past due 90 days or more and accruing
interest $ - $ -
Restructured loans 232 240
Other nonaccrual loans 93 -
Other real estate owned - -
---------- ----------
Total nonperforming assets $ 325 $ 240
========== ==========
Allowance for loan losses to total loans 1.66% 1.66%
Allowance for loan losses to NPL's 1034% 1383%
Allowance for loan losses to NPA's 1034% 1383%
Regulatory Capital and Ratios
Tier 1 capital $ 31,891 $ 31,490
Total risk-based capital $ 34,383 33,985
Tier 1 capital ratio 16.1% 15.8%
Total risk based capital ratio 17.3% 17.1%
Tier 1 leverage ratio 11.4% 12.6%
1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)
3 Months Ended
March 31,
Selected Financial Ratios 2012 2011
---------- ----------
Return on average total assets 0.44% 1.11%
Return on average shareholders' equity 3.87% 8.39%
Net interest margin 4.06% 4.60%
Efficiency ratio 79.05% 64.18%
Selected Average Balances
Loans $ 199,939 $ 181,415
Investment securities 15,732 14,191
Federal funds sold and interest bearing deposits
in other banks 53,605 15,747
---------- ----------
Total earning assets $ 269,276 $ 211,353
---------- ----------
Total assets $ 280,238 $ 217,950
---------- ----------
Demand deposits - interest bearing $ 69,736 $ 56,807
Savings 41,557 29,247
Time deposits 41,051 48,985
---------- ----------
Total interest bearing liabilities $ 152,344 $ 135,039
---------- ----------
Demand deposits - noninterest bearing $ 95,320 $ 53,081
---------- ----------
Shareholders' equity $ 32,141 $ 28,808
---------- ----------
Contact Information Jayme Fields CFO (831) 264-4011
1st Capital Bancorp (QX) (USOTC:FISB)
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