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The Banc Corporation Announces Third Quarter 2005 Results
BIRMINGHAM, Ala., Oct. 21 /PRNewswire-FirstCall/ -- The Banc Corporation announced today its 2005 third quarter results of operations. The Banc Corporation reported net income for the quarter ended September 30, 2005 of $680,000, compared to a net loss of $830,000 for the quarter ended September 30, 2004. Net income (loss) per common share for the three- and nine-month periods ended September 30, 2005 and 2004 was as follows: For the Three-Month For the Nine-Month
Period Ended Period Ended
September 30, September 30,
(In thousands, (In thousands,
except per except per
share data) share data)
2005 2004 2005 2004
Net income (loss) $680 $(830) $(6,776) $1,462
Less:
Preferred stock dividends - - 305 217
Effect of early conversion
of preferred stock - - 2,006 -
Net income (loss) available
to common stockholders $680 $(830) $(9,087) $ 1,245
Net income (loss) per
common share
Basic $ 0.03 $(0.05) $(0.48) $0.07
Diluted $ 0.03 $(0.05) $(0.48) $0.07
The Corporation provided $500,000 to the allowance for loan losses during the third quarter. Net charge-offs for the third quarter were $739,000. The allowance for loan losses at September 30, 2005 was $12.0 million, or 1.33% of loans, net of unearned income, compared to $12.5 million, or 1.34% of loans, net of unearned income, at December 31, 2004. Non-performing assets ("NPAs") declined to 0.91% of total loans plus NPAs as of September 30, 2005 compared to 1.32% of total loans plus NPAs as of December 31, 2004. At September 30, 2005, The Banc Corporation had total assets of $1.38 billion compared to $1.42 billion at December 31, 2004. Loans, net of unearned income, decreased $32 million, or 3.37%, to $903 million at September 30, 2005 from $935 million at December 31, 2004. Investment securities decreased $31 million, or 10.8%, to $257 million at September 30, 2005 from $288 million at December 31, 2004. Deposits decreased 1.4%, to $1.05 billion at September 30, 2005 from $1.07 billion at December 31, 2004. These declines reflect the Corporation's strategy of deleveraging the balance sheet and focusing on deposit and loan mix realignment, which management expects will improve net interest margin. Stockholders' equity increased $2.7 million, or 2.7%, to $103.3 million at September 30, 2005 from $100.5 million at December 31, 2004. The Banc Corporation is a $1.38 billion community bank holding company headquartered in Birmingham, Alabama. The principal subsidiary of The Banc Corporation is The Bank, a southeastern community bank. The Bank has a total of twenty-six branches, with nineteen locations throughout the state of Alabama and seven locations along Florida's eastern panhandle. The Bank also has loan production offices in Montgomery, Alabama, Tallahassee, Florida and Panama City, Florida. Statements in this document that are not historical facts, including, but not limited to, statements concerning future operations, results or performance, are hereby identified as "forward looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. The Banc Corporation cautions that such "forward looking statements," wherever they occur in this document or in other statements attributable to The Banc Corporation are necessarily estimates reflecting the judgment of The Banc Corporation's senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the "forward looking statements." Such "forward looking statements" should, therefore, be considered in light of various important factors set forth from time to time in The Banc Corporation's reports and registration statements filed with the SEC. While it is impossible to list all such factors that could affect the accuracy of such "forward looking statements," some of those factors include general economic conditions, especially in the Southeast; the performance of the capital markets; changes in interest rates, yield curves and interest rate spread relationships; changes in accounting and tax principles, policies or guidelines; changes in legislation or regulatory requirements; changes in the competitive environment in the markets served by The Banc Corporation; and changes in the loan portfolio and the deposit base of The Banc Corporation. The Banc Corporation disclaims any intent or obligation to update "forward looking statements." More information on The Banc Corporation and its subsidiaries may be obtained over the Internet, http://www.the-banc.com/ or by calling 1-877-326-BANK (2265). The Banc Corporation and Subsidiaries
Consolidated Statements of Financial Condition
(Dollars In Thousands)
As of
September 30, December 31,
2005 2004 2004
(Unaudited) (Unaudited)
Assets
Cash and due from banks $22,140 $41,513 $23,489
Interest bearing deposits in other
banks 7,341 12,528 11,411
Federal funds sold 25,565 33,000 11,000
Investment securities available for
sale 257,080 225,036 288,308
Mortgage loans held for sale 17,447 2,138 8,095
Loans, net of unearned income 903,398 923,467 934,868
Less: Allowance for loan losses (12,024) (12,808) (12,543)
Net loans 891,374 910,659 922,325
Premises and equipment, net 55,957 59,733 60,434
Accrued interest receivable 6,238 5,687 6,237
Stock in FHLB and Federal Reserve Bank 11,821 10,243 11,787
Cash surrender value of life insurance 38,804 37,898 38,369
Other assets 42,492 42,858 41,673
Total assets $1,376,259 $1,381,293 $1,423,128
Liabilities and Stockholders' Equity
Deposits
Noninterest-bearing $91,265 $88,943 $89,487
Interest-bearing brokered
certificates of deposit 141,166 195,849 203,917
Interest-bearing other deposits 819,850 746,820 773,802
Total deposits 1,052,281 1,031,612 1,067,206
Advances from FHLB 146,090 156,090 156,090
Federal funds borrowed and security
repurchase agreements 20,861 43,802 49,456
Long-term debt 3,808 1,768 3,965
Junior subordinated debentures owed to
unconsolidated subsidiary trusts 31,959 31,959 31,959
Accrued expenses and other liabilities 17,983 14,605 13,913
Total liabilities 1,272,982 1,279,836 1,322,589
Stockholders' Equity
Preferred stock, par value $.001 per
share; authorized 5,000,000 shares;
shares issued and outstanding
62,000 at December 31, 2004 - - -
Common stock, par value $.001 per
share; authorized 35,000,000
shares; shares issued 20,023,756,
18,025,932 and 18,025,932,
respectively; outstanding 19,775,886,
17,743,171 and 17,749,846,
respectively 20 18 18
Surplus - preferred - 6,193 6,193
- common stock 86,446 68,431 68,428
Retained earnings 20,504 30,094 29,591
Accumulated other comprehensive
loss (1,755) (578) (1,094)
Treasury stock, at cost (341) (390) (390)
Unearned ESOP stock (1,597) (1,812) (1,758)
Unearned restricted stock - (499) (449)
Total stockholders' equity 103,277 101,457 100,539
Total liabilities and
stockholders' equity $1,376,259 $1,381,293 $1,423,128
The Banc Corporation and Subsidiaries
Consolidated Statements of Operations (Unaudited)
(Amounts In Thousands, Except Per Share Data)
Three Months Nine Months Year Ended
Ended Ended December
September 30 September 30 31,
2005 2004 2005 2004 2004
Interest income
Interest and fees on loans $16,063 $14,244 $46,531 $41,502 $56,184
Interest on investment
securities
Taxable 2,919 2,270 8,789 6,092 8,897
Exempt from Federal income
tax 62 47 179 88 143
Interest on federal funds
sold 163 32 354 107 202
Interest and dividends on
other investments 272 157 769 553 734
Total interest income 19,479 16,750 56,622 48,342 66,160
Interest expense
Interest on deposits 7,346 4,859 19,911 13,641 19,188
Interest on advances from
FHLB and other borrowed funds 1,927 1,510 5,665 4,632 6,356
Interest on subordinated
debentures 732 653 2,116 1,905 2,579
Total interest expense 10,005 7,022 27,692 20,178 28,123
Net interest income 9,474 9,728 28,930 28,164 38,037
Provision for loan losses 500 - 2,750 - 975
Net interest income
after provision for
loan losses 8,974 9,728 26,180 28,164 37,062
Noninterest income
Service charges and fees 1,448 1,526 3,726 4,314 5,204
Mortgage banking income 693 463 1,901 1,250 1,664
Securities (losses) gains - (4) (977) 424 (74)
Gain on sale of branch - - - 739 739
Increase in cash surrender
value of life insurance 389 399 1,131 1,212 1,643
Insurance proceeds - - 5,000 - -
Other income 270 345 1,257 1,357 2,090
Total noninterest income 2,800 2,729 12,038 9,296 11,266
Noninterest expense
Salaries and employee
benefits 6,048 5,925 17,377 17,382 23,481
Occupancy and equipment 1,898 1,982 5,938 6,034 8,047
Management separation costs 64 - 15,402 - -
Loss on sale of loans - 2,260 - 2,260 2,293
Other 3,028 3,605 11,126 10,409 14,116
Total noninterest expense 11,038 13,772 49,843 36,085 47,937
Income (loss) before
income taxes (benefit) 736 (1,315) (11,625) 1,375 391
Income tax expense (benefit) 56 (485) (4,849) (87) (796)
Net income (loss) 680 (830) (6,776) 1,462 1,187
Preferred stock
dividends - - 305 217 446
Effect of early
conversion of
preferred stock - - 2,006 - -
Net income (loss)
available to common
stockholders $680 $(830) $(9,087) $1,245 $741
Basic net income(loss) per
common share $0.03 $(0.05) $(0.48) $0.07 $0.04
Diluted net income(loss) per
common share $0.03 $(0.05) $(0.48) $0.07 $0.04
Weighted average common
shares outstanding 19,625 17,590 18,920 17,576 17,583
Weighted average common
shares outstanding, assuming
dilution 20,240 17,590 18,920 17,741 17,815
THE BANC CORPORATION
UNAUDITED SUMMARY CONSOLIDATED FINANCIAL DATA
(Dollars in Thousands, except Per Share Data)
As of and for the As of and for the
Three Months Nine Months
Ended September 30, Ended September 30,
2005 2004 2005 2004
Selected Average
Balances:
Total assets $1,396,749 $1,310,459 $1,411,285 $1,263,429
Loans, net of unearned
income 931,598 918,093 943,550 882,030
Investment securities 260,857 211,623 267,450 186,577
Total interest-earning
assets 1,234,102 1,162,631 1,250,685 1,118,973
Noninterest-bearing
deposits 94,219 90,803 93,936 86,417
Interest-bearing deposits 967,675 893,737 975,012 857,474
Advances from FHLB 146,090 156,090 147,152 155,962
Federal funds borrowed and
security repurchase
agreements 29,382 23,163 39,548 17,623
Junior subordinated
debentures owed to
unconsolidated subsidiary
trusts 31,959 31,959 31,959 31,959
Total interest-bearing
liabilities 1,178,940 1,106,751 1,197,560 1,064,876
Stockholders' Equity 101,478 101,244 101,153 100,636
Per Share Data:
Net income (loss) - basic (1) $0.03 $(0.05) $(0.48) $0.07
- diluted (1)(2) $0.03 $(0.05) $(0.48) $0.07
Weighted average shares
outstanding - basic 19,625 17,590 18,920 17,576
Weighted average shares
outstanding - diluted (2) 20,240 17,590 18,920 17,741
Common book value per
share at period end $5.22 $5.37 $5.22 $5.37
Tangible common book value
per share at period end $4.61 $4.67 $4.61 $4.67
Preferred shares
outstanding at period end (1) - 62 - 62
Common shares outstanding
at period end 19,776 17,743 19,776 17,743
Performance Ratios and
Other Data:
Return on average assets (3) 0.19% (0.25)% (0.64)% 0.15%
Return on average
stockholders' equity (3) 2.66 (3.26) (8.96) 1.94
Net interest margin (3)(4)(5) 3.06 3.34 3.10 3.37
Net interest spread (3)(5)(6) 2.90 3.22 2.97 3.25
Noninterest income to
average assets (3)(7) 0.80 0.83 0.76 0.86
Noninterest expense to
average assets (3)(8) 3.12 3.49 3.26 3.58
Efficiency ratio (9) 89.84 87.63 91.04 90.74
Average loan to average
deposit ratio 87.73 93.25 88.27 93.45
Average interest-earning
assets to average interest
bearing liabilities 104.68 105.05 104.44 105.08
Assets Quality Ratios:
Allowance for loan losses
to nonperforming loans 196.21% 161.25% 196.21% 161.25%
Allowance for loan losses
to loans, net of unearned
income 1.33 1.39 1.33 1.39
Nonperforming assets("NPAs")
to loans plus NPA's, net of
unearned income 0.91 1.43 0.91 1.43
Nonaccrual loans to loans,
net of unearned income 0.67 0.75 0.67 0.75
Net loan charge-offs to
average loans (3) 0.31 3.19 0.46 1.87
Net loan charge-offs as a
percentage of:
Provision for loan
losses 147.80 - 118.87 -
Allowance for loan
losses (3) 24.38 228.98 36.35 128.97
(1) - Earnings per share for the nine-month period ended September 30,
2005 has been calculated on net loss adjusted for preferred stock
dividends of $305,000 and the effect of the preferred stock
conversion totaling $2,006,000. Earning per share for the nine
month period ended September 30, 2004 and the twelve month
period ended December 31, 2004 has been calculated on net income
adjusted for preferred stock dividends of $218,000 and 446,000,
respectively.
(2) - Common stock equivalents ("CSE's") of 1,109,341 were not included
in computing diluted earnings per share for the nine-month period
ended September 30, 2005. CSE's of 939,444 and 775,000 were not
included for the three- and nine-month periods ended September 30,
2004, respectively. CSE's of 775,000 were not included for the
twelve-month period ended December 31, 2004. These CSE's were not
included because their effects were anti-dilutive.
(3) - Annualized for the three- and nine-month periods ended September
30, 2005 and 2004.
(4) - Net interest income divided by average earning assets.
(5) - Calculated on a taxable equivalent basis.
(6) - Yield on average interest-earning assets less rate on average
interest-bearing liabilities.
(7) - Noninterest income has been adjusted for certain nonrecurring items
such as gain on sale of branches, insurance proceeds and investment
security gains(losses).
(8) - Noninterest expense has been adjusted for certain nonrecurring items
such as loss on sale of assets and management separation costs.
(9) - Efficiency ratio is calculated by dividing noninterest expense,
adjusted for management separation costs, losses on other real
estate and the loss on sale of assets, by noninterest income,
adjusted for gain on sale of branches, insurance proceeds and
investment security gains (losses), plus net interest income on a
fully tax equivalent basis.
THE BANC CORPORATION
UNAUDITED SUMMARY CONSOLIDATED FINANCIAL DATA
(Dollars in Thousands, except Per Share Data)
As of and for the Year
Ended December 31,
2004
Selected Average Balances:
Total assets $1,296,574
Loans, net of unearned income 894,406
Investment securities 207,864
Total interest-earning assets 1,150,361
Noninterest-bearing deposits 88,695
Interest-bearing deposits 881,799
Advances from FHLB 155,994
Federal funds borrowed and security
repurchase agreements 25,226
Junior subordinated debentures owed
to unconsolidated subsidiary trusts 31,959
Total interest-bearing liabilities 1,096,810
Stockholders' Equity 100,915
Per Share Data:
Net income (loss) - basic (1) $0.04
- diluted (1)(2) $0.04
Weighted average shares outstanding - basic 17,583
Weighted average shares outstanding - diluted (2) 17,815
Common book value per share at period end $5.31
Tangible common book value per share
at period end $4.62
Preferred shares outstanding at
period end (1) 62
Common shares outstanding at period end 17,750
Performance Ratios and Other Data:
Return on average assets (3) 0.09%
Return on average stockholders' equity (3) 1.18
Net interest margin (3)(4)(5) 3.31
Net interest spread (3)(5)(6) 3.20
Noninterest income to average assets (3)(7) 0.82
Noninterest expense to average assets (3)(8) 3.52
Efficiency ratio (9) 91.72
Average loan to average deposit ratio 92.16
Average interest-earning assets to
average interest bearing liabilities 104.88
Assets Quality Ratios:
Allowance for loan losses to
nonperforming loans 169.36%
Allowance for loan losses to loans,
net of unearned income 1.34
Nonperforming assets("NPAs") to loans
plus NPA's, net of unearned income 1.32
Nonaccrual loans to loans, net of
unearned income 0.68
Net loan charge-offs to average loans (3) 1.52
Net loan charge-offs as a percentage of:
Provision for loan losses 1,395.49
Allowance for loan losses (3) 108.47
(1) - Earnings per share for the nine-month period ended September 30,
2005 has been calculated on net loss adjusted for preferred stock
dividends of $305,000 and the effect of the preferred stock
conversion totaling $2,006,000. Earning per share for the nine
month period ended September 30, 2004 and the twelve month
period ended December 31, 2004 has been calculated on net income
adjusted for preferred stock dividends of $218,000 and 446,000,
respectively.
(2) - Common stock equivalents ("CSE's") of 1,109,341 were not included
in computing diluted earnings per share for the nine-month period
ended September 30, 2005. CSE's of 939,444 and 775,000 were not
included for the three- and nine-month periods ended September 30,
2004, respectively. CSE's of 775,000 were not included for the
twelve-month period ended December 31, 2004. These CSE's were not
included because their effects were anti-dilutive.
(3) - Annualized for the three- and nine-month periods ended September
30, 2005 and 2004.
(4) - Net interest income divided by average earning assets.
(5) - Calculated on a taxable equivalent basis.
(6) - Yield on average interest-earning assets less rate on average
interest-bearing liabilities.
(7) - Noninterest income has been adjusted for certain nonrecurring items
such as gain on sale of branches, insurance proceeds and investment
security gains(losses).
(8) - Noninterest expense has been adjusted for certain nonrecurring items
such as loss on sale of assets and management separation costs.
(9) - Efficiency ratio is calculated by dividing noninterest expense,
adjusted for management separation costs, losses on other real
estate and the loss on sale of assets, by noninterest income,
adjusted for gain on sale of branches, insurance proceeds and
investment security gains (losses), plus net interest income on a
fully tax equivalent basis.
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