PAOLA, Kan., Aug. 4 /PRNewswire-FirstCall/ -- Team Financial, Inc. (the Company) today announced net income of $949,000, or $.25 basic and $.24 diluted income per share, for the three months ended June 30, 2006, an increase of 10.5%, compared to $859,000 or $.21 basic and diluted income per share, for the three months ended June 30, 2005. Net income for the six months ended June 30, 2006 was $1,877,000, or $.48 basic and $.47 diluted income per share, compared to $1,855,000, or $.46 basic and $.45 diluted income per share for the six months ended June 30, 2005, an increase of 1.2%.
As previously disclosed, the Company recorded a loss on the sale of its insurance agency subsidiary during the second quarter of 2005 of approximately $164,000. The subsidiary was sold effective December 31, 2004. The loss on the sale of the subsidiary is reported net of the tax effect in discontinued operations.
Net income from continuing operations was $949,000, or $.25 basic and $.24 diluted income per share, for the three months ended June 30, 2006, a decrease of 1.9%, compared to $967,000, or .24 basic and diluted income per share, for the three months ended June 30, 2005. Net income from continuing operations for the six months ended June 30, 2006 was $1,877,000, or $.48 basic and $.47 diluted income per share, compared to $1,963,000, or $.49 basic and $.48 diluted income per share for the six months ended June 30, 2005.
Net interest income for the three months ended June 30, 2006 increased approximately $678,000, or 13%, from the same period last year, primarily due to the increase in loan balances and a 16 basis point increase in net interest margin. Non-interest income decreased approximately $190,000, or 10%, primarily due to a decrease in service charge income, a loss taken on investment securities in an effort to reposition the portfolio, and a continued decrease in gain on sales of mortgage loans. Non-interest expense increased $558,000, or 10%, primarily due to an increase in salary and benefits expense as a result of hiring several new loan officers in the Colorado Springs and Kansas City markets, and an increase in professional fees.
Loans receivable increased approximately $35.1 million, or 8.4%, to $455.3 million at June 30, 2006 compared to December 31, 2005. This increase was primarily a result of an increase in construction and land development loans.
"We had another steady quarter of loan growth, with $11.7 million loan growth during the quarter. Our net interest margin remains stronger than what we were experiencing a year ago, despite placing approximately $2 million of loans on non-accrual status during the quarter.
"We recently received a claim against the representations and warranties provisions of the sales contract of the insurance agency subsidiary that we sold effective December 31, 2004. We do not believe that any of the claims are legitimate and we will dispute all of them. Although this may mean incurring significant legal costs to defend our position, we firmly believe that the claims presented have no merit," said Robert J. Weatherbie, Chairman and Chief Executive Officer of Team Financial, Inc.
The provision for loan losses was $157,000 for the three months ended June 30, 2006 compared to $267,000 for the three months ended June 30, 2005. The allowance for loan losses as a percent of loans receivable was 1.25% at June 30, 2006 and 1.29% at December 31, 2005, and non-performing loans were 1.28% of loans receivable at June 30, 2006 and 1.09% of loans receivable at December 31, 2005. Though non-performing assets have increased, additional allowances were not necessary as the Company believes the non-performing credits added to non-accrual are well-secured.
Team Financial, Inc. is a financial services company with $716 million in total assets. It operates in the Kansas City metropolitan area, southeastern Kansas, western Missouri, the Omaha, Nebraska metropolitan area, and in the Colorado Springs, Colorado metropolitan area. The Company offers a full range of consumer and corporate banking services, including small business loans, mortgage loans, trust services, and investment and brokerage services. For additional information on Team Financial, Inc., visit its Web site at http://www.teamfinancialinc.com/ or call 913-294-9667.
This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995 that are subject to certain risks and uncertainties that could cause actual results to differ materially from historical income and those presently anticipated or projected. The Company cautions readers not to place undue reliance on any such forward looking statements, which speak only as of the date of this release. Such risks and uncertainties include those detailed in the Company's filings with the Securities and Exchange Commission, risks of adversely changing results of operations, risks related to the Company's acquisition strategy, risks relating to loans and investments, including the effect of the change of the local economic conditions, risks associated with the adverse effects of the changes in interest rates, and competition for the Company's customers by other providers of financial services, all of which are difficult to predict and many of which are beyond the control of the Company.
TEAM FINANCIAL, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Financial Condition
(In Thousands)
June 30, December 31,
Assets 2006 2005
Cash and due from banks $15,883 $14,592
Federal funds sold and interest
bearing bank deposits 7,941 19,768
Cash and cash equivalents 23,824 34,360
Investment securities:
Available for sale, at fair value
(amortized cost of $180,249 and
$183,719 at June 30, 2006 and December
31, 2005, respectively) 175,528 181,758
Other non-marketable securities
(amortized cost of $8,854 and
$8,669 at June 30, 2006 and December
31, 2005, respectively) 8,651 8,651
Total investment securities 184,179 190,409
Loans receivable, net of unearned
fees 455,278 420,181
Allowance for loan losses (5,701) (5,424)
Net loans receivable 449,577 414,757
Accrued interest receivable 5,202 4,607
Premises and equipment, net 16,536 16,359
Assets acquired through foreclosure 856 455
Goodwill 10,700 10,700
Intangible assets, net of
accumulated amortization 2,930 3,223
Bank-owned life insurance policies 19,539 19,173
Other assets 2,589 2,486
Total assets $715,932 $696,529
Liabilities and Stockholder's Equity
Deposits:
Checking deposits $175,216 $186,791
Savings deposits 30,251 31,944
Money market deposits 57,443 46,465
Certificates of deposit 269,794 242,678
Total deposits 532,704 507,878
Federal funds purchased and
securities sold under agreements
to repurchase 3,707 4,036
Federal Home Loan Bank advances 108,100 111,131
Notes payable 6,123 202
Subordinated debentures 16,005 16,005
Accrued expenses and other liabilities 3,652 3,928
Total liabilities 670,291 643,180
Stockholders' Equity:
Preferred stock, no par value,
10,000,000 shares authorized; no
shares issued - -
Common stock, no par value,
50,000,000 shares authorized;
4,501,516 and 4,499,470 shares
issued; 3,591,084 and 4,034,995
shares outstanding at
June 30, 2006 and December 31,
2005, respectively 27,901 27,880
Capital surplus 546 417
Retained earnings 32,212 30,941
Treasury stock, 910,432 and 464,475
shares of common stock at cost
at June 30, 2006, and December 31,
2005, respectively (11,769) (4,583)
Accumulated other comprehensive loss (3,249) (1,306)
Total stockholders' equity 45,641 53,349
Total liabilities and
stockholders' equity $715,932 $696,529
TEAM FINANCIAL, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
(Dollars In Thousands, Except Per Share Data)
Three Months Ended Six Months Ended
June 30, June 30,
2006 2005 2006 2005
Interest Income:
Interest and fees on loans $8,714 $6,775 $16,661 $13,005
Taxable investment securities 1,928 1,858 3,814 3,668
Nontaxable investment
securities 271 289 540 579
Other 170 86 307 162
Total interest income 11,083 9,008 21,322 17,414
Interest Expense:
Deposits:
Checking deposits 479 261 939 487
Savings deposits 53 56 106 108
Money market deposits 338 147 577 287
Certificates of deposit 2,632 1,637 4,805 2,984
Federal funds purchased and
securities sold under
agreements to repurchase 52 33 88 56
FHLB advances payable 1,129 1,176 2,263 2,340
Notes payable and other
borrowings 39 15 43 47
Subordinated debentures 389 389 777 777
Total interest expense 5,111 3,714 9,598 7,086
Net interest income before
provision for loan losses 5,972 5,294 11,724 10,328
Provision for loan losses 157 267 432 412
Net interest income after
provision for loan losses 5,815 5,027 11,292 9,916
Non-Interest Income:
Service charges 904 998 1,751 1,902
Trust fees 206 183 382 370
Gain on sales of mortgage loans 139 212 330 427
Loss on sales of investment
securities (90) - (90) -
Bank-owned life insurance
income 214 208 430 416
Other 369 331 718 652
Total non-interest income 1,742 1,932 3,521 3,767
Non-Interest Expenses:
Salaries and employee benefits 3,161 2,833 6,236 5,450
Occupancy and equipment 728 695 1,496 1,367
Data processing 713 722 1,398 1,411
Professional fees 476 320 850 655
Marketing 95 86 175 147
Supplies 85 82 186 161
Intangible asset amortization 148 157 295 313
Other 852 805 1,661 1,627
Total non-interest expenses 6,258 5,700 12,297 11,131
Income from continuing
operations before income
taxes 1,299 1,259 2,516 2,552
Income tax expense 350 292 639 589
Net income from continuing
operations $949 $967 $1,877 $1,963
Net loss from discontinued
operations - (108) - (108)
Net income 949 859 1,877 1,855
Basic income per share from
continuing operations $0.25 $0.24 $0.48 $0.49
Diluted income per share from
continuing operations $0.24 $0.24 $0.47 $0.48
Basic loss per share from
discontinued ops $- $(0.03) $- $(0.03)
Diluted loss per share from
discontinued ops $- $(0.03) $- $(0.03)
Basic income per share $0.25 $0.21 $0.48 $0.46
Diluted income per share $0.24 $0.21 $0.47 $0.45
Shares applicable to basic
income per share 3,850,049 4,039,675 3,937,321 4,038,291
Shares applicable to diluted
income per share 3,941,529 4,093,333 4,026,881 4,092,261
TEAM FINANCIAL, INC. AND SUBSIDIARIES
Selected Ratios and Other Data
(Unaudited)
As of and For As of and For
Three Months Ended Six Months Ended
Selected Data June 30 June 30
2006 2005 2006 2005
Performance Ratios
Return On Average Assets 0.53% 0.51% 0.53% 0.56%
Return On Average Equity 7.74% 6.50% 7.39% 7.05%
Average Equity To Average Assets 6.86% 7.86% 7.23% 7.95%
Net Interest Margin On Average
Earning Assets During The Period
(Tax Equivalent) 3.77% 3.61% 3.78% 3.60%
Efficiency Ratio(a)(c) 81.13% 78.88% 80.66% 78.97%
Book Value Per Share $12.71 $13.25
Tangible Book Value Per Share(b)(c) $9.01 $9.84
Asset Quality Ratios
Non Performing Loans As A Percent Of
Total Loans 1.28% 0.89%
Non Performing Assets As A Percent Of
Total Assets 0.94% 0.56%
Allowance For Loan Losses As A
Percent Of Total Loans 1.25% 1.30%
Allowance For Loan Losses As A
Percent Of Non Performing Loans 97.49% 145.37%
(a) Calculated as non-interest expense/(net interest income plus
non-interest income)
(b) Calculated as (stockholders equity less goodwill, less intangible
assets, net of accumulated amortization plus mortgage servicing
rights) divided by shares outstanding.
(c) Computation includes the corresponding components of discontinued
operations.
