FORT DODGE, Iowa, Feb. 2 /PRNewswire-FirstCall/ -- North Central Bancshares, Inc. (the "Company") , the holding company for First Federal Savings Bank of Iowa (the "Bank"), announced today that the Company earned $3.32 diluted earnings per share for the year ended December 31, 2006, compared to diluted earnings per share of $3.20 for the year ended December 31, 2005. The Company's net income was $4.8 million for the year ended December 31, 2006, compared to $5.0 million for the year ended December 31, 2005.
The Company's net income was $1.21 million, or diluted earnings per share of $0.86, for the fourth quarter of 2006, compared to net income of $1.16 million, or diluted earnings per share of $0.75, for the fourth quarter of 2005.
Net interest income for the year ended December 31, 2006 was $13.1 million, compared to net interest income of $13.7 million for the year ended December 31, 2005. The decrease in net interest income was primarily due to a decrease in the net interest margin, offset in part by an increase in interest-earning assets. The net interest margin of 2.79% for the year ended December 31, 2006 represented a decrease from the net interest margin of 3.05% for the year ended December 31, 2005.
The Company's provision for loan losses was $240,000 and $260,000 for the years ended December 31, 2006 and 2005, respectively. The Company establishes provisions for loan losses, which are charged to operations, in order to maintain the allowance for loan losses at a level which is deemed to be appropriate based upon an assessment of prior loss experience, industry standards, past due loans, economic conditions, the volume and type of loans in the Bank's portfolio, and other factors related to the collectibility of the Bank's loan portfolio.
The Company's noninterest income was $7.1 million and $6.5 million for the years ended December 31, 2006 and 2005, respectively. The increase in noninterest income was primarily due to an impairment of securities available- for-sale recognized during the year ended December 31, 2005. The increase in noninterest income was also due to an increase in fees associated with checking accounts, including overdraft fees, offset in part by a decrease in loan prepayment fees.
The Company's noninterest expense was $13.1 million and $12.4 million for the years ended December 31, 2006 and 2005, respectively. The increase in noninterest expense was primarily due to increases in compensation and data processing expenses.
The Company's provision for income taxes was $2.1 million and $2.5 million for the years ended December 31, 2006 and 2005, respectively. The decrease in the provision for income taxes was primarily due to the lower 2006 income before income taxes and the limited deductibility of the other-than-temporary impairment of securities available-for-sale in 2005.
Total assets at December 31, 2006 were $515.5 million, compared to $485.2 million at December 31, 2005. The increase in assets consisted primarily of increases in loans, cash and cash equivalents, and premises and equipment, offset in part by a decrease in securities available-for-sale. Net loans increased by $18.8 million, or 4.4%, to $449.0 million at December 31, 2006 from $430.3 million at December 31, 2005. At December 31, 2006, net loans consisted of $216.0 million of one-to-four family real estate loans, $103.2 million of commercial real estate loans, $65.2 million of multi-family real estate loans, and $64.6 million of consumer loans. The increase in net loans was primarily due to the origination of one-to-four family and commercial real estate loans; the purchase of commercial, one-to-four family, and multi-family real estate loans; and the origination of second mortgage loans. These originations and purchases were offset in part by payments, prepayments, and sales of loans. Cash and cash equivalents increased $11.4 million, or 131.7%, to $20.0 million at December 31, 2006, compared to $8.6 million at December 31, 2005. The increase in cash and cash equivalents was primarily due to large commercial loan pay-offs in December. Premises and equipment, net, increased by $1.7 million, or 15.2%, to $12.6 million at December 31, 2006 from $11.0 million at December 31, 2005. The increase in premises and equipment was primarily due to the construction costs associated with the construction of a new branch office located at the Jordan Creek Town Center in West Des Moines, Iowa and the expansion of the Crossroads branch in Fort Dodge, Iowa. Securities available-for-sale decreased $678,000, or 3.3%, to $20.0 million at December 31, 2006 from $20.7 million at December 31, 2005. The decrease in securities available-for-sale consisted primarily of a decrease in investments in mortgage-backed securities, offset in part by an increase in investments in municipal securities and FHLB stock and an increase in unrealized gains.
Deposits increased $26.0 million, or 7.8%, to $360.3 million at December 31, 2006 from $334.3 million at December 31, 2005. The increase in deposits was due to an increase in the balance of certificates of deposit, including brokered certificates of deposit. Other borrowed funds increased $5.5 million, or 5.3%, to $107.9 million at December 31, 2006 from $102.4 million at December 31, 2005. The increase in deposits and borrowed funds were used primarily to fund loan growth.
Nonperforming assets were 0.20% of total assets as of December 31, 2006, compared to 0.36% of total assets as of December 31, 2005. The allowance for loan losses was $3.5 million, or 0.77% of total loans, at December 31, 2006, compared to $3.3 million, or 0.76% of total loans, at December 31, 2005.
Stockholders' equity was $42.2 million at December 31, 2006, compared to $44.3 million at December 31, 2005. Stockholders' equity decreased by $2.1 million primarily due to stock repurchases and declared dividends, offset in part by earnings, the exercise of stock options, and an increase in unrealized gain on securities available-for-sale. Book value, or stockholders' equity per share, at December 31, 2006 was $30.56, compared to $29.37 at December 31, 2005. The ratio of stockholders' equity to total assets was 8.2% at December 31, 2006, compared to 9.1% at December 31, 2005.
All stockholders of record on December 15, 2006, received a quarterly cash dividend of $0.33 per share on January 5, 2007. As of December 31, 2006, the Company had 1,380,653 shares of common stock outstanding.
During the year ended December 31, 2006, the Company repurchased a total of 151,250 shares of common stock, or approximately 10.0% of its outstanding shares of common stock at prevailing market prices averaging $39.31 per share.
North Central Bancshares, Inc. serves north central and southeastern Iowa at eleven full service locations in Fort Dodge, Nevada, Ames, Perry, Ankeny, Clive, West Des Moines, Burlington, and Mount Pleasant, Iowa through its wholly-owned subsidiary, First Federal Savings Bank of Iowa, headquartered in Fort Dodge, Iowa.
The Bank's deposits are insured by the Federal Deposit Insurance Corporation up to the full extent permitted by law.
Statements included in this press release and in future filings by North Central Bancshares, Inc. with the Securities and Exchange Commission, in North Central Bancshares, Inc. press releases, and in oral statements made with the approval of an authorized executive officer, which are not historical or current facts, are "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, and are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. North Central Bancshares, Inc. wishes to caution readers not to place undue reliance on such forward-looking statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect North Central Bancshares, Inc.'s actual results, and could cause North Central Bancshares, Inc.'s actual financial performance to differ materially from that expressed in any forward- looking statement: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) revenues may be lower than expected; (3) changes in the interest rate environment may reduce interest margins; (4) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit; (5) legislative or regulatory changes, including changes in accounting standards, may adversely affect the business in which the Company is engaged; (6) competitors may have greater financial resources and developed products that enable such competitors to compete more successfully than the Company; and (7) adverse changes may occur in the securities markets or with respect to inflation. The foregoing list should not be construed as exhaustive, and North Central Bancshares, Inc. disclaims any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements, or to reflect the occurrence of anticipated or unanticipated events.
For more information contact: David M. Bradley, Chairman, 515-576-7531
FINANCIAL HIGHLIGHTS OF NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Financial Condition
(Unaudited)
(Dollars in Thousands, December 31, December 31,
except per share and share data) 2006 2005
Assets
Cash and cash equivalents $20,022 $8,640
Securities available-for- sale 20,030 20,708
Loans (net of allowance of
loan loss of $3,493 and
$3,326, respectively) 449,043 430,278
Goodwill 4,947 4,971
Other assets 21,473 20,594
Total assets $515,515 $485,191
Liabilities
Deposits $360,330 $334,338
Other borrowed funds 107,908 102,444
Other liabilities 5,085 4,131
Total liabilities 473,323 440,913
Stockholders' equity 42,192 44,278
Total liabilities and
stockholders' equity $515,515 $485,191
Stockholders' equity to total assets 8.18% 9.13%
Book value per share $30.56 $29.37
Total shares outstanding 1,380,653 1,507,703
Condensed Consolidated Statements of Income
(Unaudited)
(Dollars in Thousands, except per share data)
For the Three Months For the Years
Ended December 31, Ended December 31,
2006 2005 2006 2005
Interest income $7,617 $6,752 $28,537 $26,272
Interest expense 4,325 3,368 15,415 12,607
Net interest income 3,292 3,384 13,122 13,665
Provision for loan loss 60 80 240 260
Net interest income
after provision
for loan loss 3,232 3,304 12,882 13,405
Noninterest income 1,789 1,647 7,111 6,548
Noninterest expense 3,294 3,355 13,119 12,439
Income before
income taxes 1,727 1,596 6,874 7,514
Income taxes 519 436 2,062 2,499
Net income $1,208 $1,160 $4,812 $5,015
Basic earnings
per share $0.87 $0.77 $3.36 $3.29
Diluted earnings
per share $0.86 $0.75 $3.32 $3.20
Selected Financial Ratios
For the Three Months For the Years
Ended December 31, Ended December 31,
2006 2005 2006 2005
Performance ratios
Net interest spread 2.50% 2.76% 2.56% 2.83%
Net interest margin 2.72% 2.97% 2.79% 3.05%
Return on
average assets 0.94% 0.96% 0.96% 1.05%
Return on
average equity 11.36% 10.51% 11.24% 11.57%
Efficiency ratio
(noninterest expense
divided by the sum of
net interest income
before provision for
loan losses plus
noninterest income) 64.84% 66.69% 64.84% 61.54%
