PAOLA, Kan., Feb. 9 /PRNewswire-FirstCall/ -- Team Financial, Inc. (the "Company") today announced net income of $1,324,000, or $.37 basic and $.36 diluted income per share, for the three months ended December 31, 2006, compared to $1,234,000 or $.31 basic and $.30 diluted income per share, for the three months ended December 31, 2005, an increase of 7.3%. Net income for the twelve months ended December 31, 2006 was $3,985,000, or $1.06 basic and $1.03 diluted income per share, compared to $3,970,000, or $.98 basic and $.97 diluted income per share for the twelve months ended December 31, 2005.
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 for the twelve months ended December 31, 2006 was $3,982,000, or $1.06 basic and $1.03 diluted income per share, compared to $4,078,000, or $1.01 basic and $1.00 diluted income per share for the twelve months ended December 31, 2005.
Net interest income for the three and twelve months ended December 31, 2006 increased approximately $627,000, or 11.1%, and $2.7 million, or 12.6%, from the same periods last year, due to an increase in net interest margin of 8 and 15 basis points, respectively. Non-interest income decreased approximately $22 thousand, or 1.1% and $.5 million from the same three and twelve month periods last year, primarily due to a continued decrease in gain on sales of mortgage loans. Non-interest expense increased $207 thousand, or 3.4%, during the three months ended December 31, 2006 from the same period last year, primarily due to a $91 thousand increase in occupancy and equipment expense as a result of a write-down of one of the Company's properties. For the twelve months ended December 31, 2006, non-interest expense increased $2.1 million over the prior year primarily due to an increase in salaries and employee benefits and an increase in other expenses due to the previously disclosed $824 thousand charge incurred during the restructuring of the Company's trust preferred securities.
Loans receivable increased approximately $66.3 million, or 15.8%, to $486.5 million at December 31, 2006 compared to December 31, 2005. This increase was primarily a result of an increase in construction and land development loans. The increase in loans was funded with a $55.0 million, or 10.8%, increase in total deposits, and a decrease in investment securities of $11.3 million, or 5.9%.
"Our $66 million in loan growth and another 15 basis point increase in our net interest margin in 2006 show that our continued focus on controlled growth has been successful. We plan to continue our growth and our expansion into high-growth markets in 2007 with the opening of new branches. In connection with this new growth, our new location in Falcon, Colorado is set to open in March, and we will also open our new branch in Ottawa, Kansas this summer," said Robert J. Weatherbie, Chairman and Chief Executive Officer of Team Financial, Inc.
The provision for loan losses was $388,000 for the three months ended December 31, 2006 compared to $145,000 for the three months ended December 31, 2005. The allowance for loan losses as a percent of loans was 1.17% at December 31, 2006 and 1.29% at December 31, 2005, and non-performing loans were 2.06% of total loans at December 31, 2006 and 1.09% of total loans at December 31, 2005. The Company believes that additional non-performing credits are well-secured, making additional allowances unnecessary.
On February 6, 2007, a complaint was filed by International Insurance Brokers, LTD in the United States District Court for the Northern District of Oklahoma against the Company and certain of its officers, claiming breach of contract, negligent misrepresentation, fraud and misrepresentation and civil conspiracy in connection with the sale of the insurance agency subsidiary that was sold to International Insurance Brokers effective December 31, 2004. Damages sought by the defendants include not less than $10 million in actual damages, not less than $10 million for consequential, and not less than $10 million for punitive damages. The Company believes the claims are totally without merit, and it will pursue a vigorous defense as well as pursue available counterclaims against the plaintiff.
Team Financial, Inc. is a financial services company with $756 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)
December 31, December 31,
Assets 2006 2005
Cash and due from banks $14,529 $14,592
Federal funds sold and interest
bearing bank deposits 22,621 19,768
Cash and cash equivalents 37,150 34,360
Investment securities:
Available for sale, at fair value
(amortized cost of $171,301 and
$183,719 at December 31, 2006 and
December 31, 2005, respectively) 170,078 181,758
Other non-marketable securities
(amortized cost of $9,061 and
$8,669 at December 31, 2006 and
December 31, 2005, respectively) 9,062 8,651
Total investment securities 179,140 190,409
Loans receivable, net of unearned fees 486,497 420,181
Allowance for loan losses (5,715) (5,424)
Net loans receivable 480,782 414,757
Accrued interest receivable 5,558 4,607
Premises and equipment, net 17,628 16,359
Assets acquired through foreclosure 817 455
Goodwill 10,700 10,700
Intangible assets, net of
accumulated amortization 2,659 3,223
Bank-owned life insurance policies 19,926 19,173
Other assets 2,068 2,486
Total assets $756,428 $696,529
Liabilities and Stockholder's Equity
Deposits:
Checking deposits $194,979 $186,791
Savings deposits 28,536 31,944
Money market deposits 57,123 46,465
Certificates of deposit 282,244 242,678
Total deposits 562,882 507,878
Federal funds purchased and
securities sold
under agreements to repurchase 6,215 4,036
Federal Home Loan Bank advances 108,069 111,131
Notes payable 200 202
Subordinated debentures 22,681 16,005
Accrued expenses and other liabilities 5,864 3,928
Total liabilities 705,911 643,180
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;
3,594,784 and 4,034,995 shares
outstanding at December 31, 2006
and December 31, 2005, respectively 27,901 27,880
Capital surplus 680 417
Retained earnings 34,449 30,941
Treasury stock, 906,732 and 464,475
shares of common stock at cost
at December 31, 2006, and
December 31, 2005, respectively (11,707) (4,583)
Accumulated other comprehensive loss (806) (1,306)
Total stockholders' equity 50,517 53,349
Total liabilities and
stockholders' equity $756,428 $696,529
TEAM FINANCIAL, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
(Dollars In Thousands, Except Per Share Data)
Three Months Ended Twelve Months Ended
December 31, December 31,
2006 2005 2006 2005
Interest Income:
Interest and fees on loans $9,810 $7,637 $35,761 $27,778
Taxable investment securities 2,003 1,869 7,832 7,352
Nontaxable investment
securities 242 279 1,038 1,168
Other 86 94 508 311
Total interest income 12,141 9,879 45,139 36,609
Interest Expense:
Deposits:
Checking deposits 446 336 1,845 1,124
Savings deposits 66 56 229 222
Money market deposits 514 183 1,508 627
Certificates of deposit 3,244 2,047 11,059 6,823
Federal funds purchased and
securities sold under
agreements to repurchase 47 29 171 136
FHLB advances payable 1,138 1,181 4,540 4,696
Notes payable and other
borrowings 4 4 141 62
Subordinated debentures 400 388 1,588 1,553
Total interest expense 5,859 4,224 21,081 15,243
Net interest income before
provision for loan losses 6,282 5,655 24,058 21,366
Provision for loan losses 388 145 951 820
Net interest income after
provision for loan losses 5,894 5,510 23,107 20,546
Non-Interest Income:
Service charges 956 960 3,658 3,891
Trust fees 165 173 720 702
Gain on sales of mortgage loans 129 220 584 887
Loss on sales of investment
securities 7 (1) (157) (1)
Bank-owned life insurance income 234 217 884 842
Other 433 377 1,523 1,385
Total non-interest income 1,924 1,946 7,212 7,706
Non-Interest Expenses:
Salaries and employee benefits 3,086 3,145 12,299 11,406
Occupancy and equipment 858 687 3,127 2,759
Data processing 802 714 2,937 2,851
Professional fees 335 347 1,435 1,348
Marketing 124 125 408 378
Supplies 101 63 350 322
Intangible asset amortization 143 152 579 616
Other 845 854 4,149 3,550
Total non-interest expenses 6,294 6,087 25,284 23,230
Income from continuing
operations before income
taxes 1,524 1,369 5,035 5,022
Income tax expense 200 135 1,050 944
Net income from continuing
operations $1,324 $1,234 $3,985 $4,078
Net loss from discontinued
operations - - - (108)
Net income $1,324 $1,234 $3,985 $3,970
Basic income per share from
continuing operations $0.37 $0.31 $1.06 $1.01
Diluted income per share from
continuing operations $0.36 $0.30 $1.03 $1.00
Basic loss per share from
discontinued operations $ - $ - $ - $(0.03)
Diluted loss per share from
discontinued operations $ - $ - $ - $(0.03)
Basic income per share $0.37 $0.31 $1.06 $0.98
Diluted income per share $0.36 $0.30 $1.03 $0.97
Shares applicable to basic
income per share 3,597,045 4,035,218 3,765,118 4,038,097
Shares applicable to diluted
income per share 3,704,991 4,091,480 3,859,442 4,094,793
Team Financial, Inc. And Subsidiaries
Selected Ratios and Other Data
(Unaudited)
As of and For As of and For
Three Months Ended Twelve Months Ended
December 31 December 31
Selected Data 2006 2005 2006 2005
Balance Sheet Highlights
Average Assets $739,676 $686,104 $718,891 $673,307
Average Loans $481,558 $417,661 $458,086 $403,234
Non Performing Loans $10,003 $4,582
Performance Ratios
Return On Average Assets 0.71% 0.71% 0.55% 0.59%
Return On Average Equity 10.70% 9.20% 7.98% 7.46%
Average Equity To Average Assets 6.63% 7.76% 6.95% 7.90%
Net Interest Margin On Average
Earning Assets During The
Period (Tax Equivalent) 3.81% 3.73% 3.79% 3.64%
Efficiency Ratio(a)(c) 76.70% 80.08% 80.86% 79.91%
Book Value Per Share $14.05 $13.22
Tangible Book Value Per
Share(b)(c) $10.43 $9.87
Asset Quality Ratios
Non Performing Loans As A Percent
Of Total Loans 2.06% 1.09%
Non Performing Assets As A Percent
Of Total Assets 1.43% 0.72%
Allowance For Loan Losses As A
Percent Of Total Loans 1.17% 1.29%
Allowance For Loan Losses As A
Percent Of Non Performing Loans 57.13% 118.38%
(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.
