EVANSVILLE, Ind., Feb. 6 /PRNewswire-FirstCall/ -- American Community Bancorp, Inc. (the "Company") (BULLETIN BOARD: ACBP) , the holding company for Bank of Evansville, today reported consolidated net income for the 2007 fiscal year of $503,855 compared to 2006 net income of $1,736,011. Diluted earnings per share, adjusted for the 5 percent stock dividend declared in April 2007, were $.27 per share for 2007 and $.94 per share for 2006.
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For the quarter ended December 31, 2007, a net loss of $1,006,758 was recorded versus net income of $400,778 for the same quarter in 2006. Diluted earnings per share for the fourth quarter of 2007 was $(.54) per share, compared to $.22 per share for the fourth quarter of 2006. The provision for loan losses in the fourth quarter of 2007 was $2,448,977 compared to $125,000 in the fourth quarter of 2006. The increase in the provision and the loss for the fourth quarter are primarily the result of a charge-off of $2,437,540 related to one large credit relationship.
Michael S. Sutton, President and CEO, commented, "Obviously we are disappointed with our 2007 earnings. The charge-off associated with one commercial borrowing relationship represented an after-tax charge of approximately $1,463,000. Although we cannot be certain of the final resolution of this credit, we believe we have taken a conservative approach to the write down. While we cannot ignore the significance of this charge, it is important to note a number of significant financial accomplishments. In spite of a softening economy and a very competitive local banking market, we enjoyed double digit growth in assets, loans, and deposits. Average total assets increased $25,756,666 or 11.4 percent over 2006. An increase in average loans of $27,473,766 or 14.1 percent was the major contributor to the increase in average earning assets of $26,097,361 or 12.1 percent. Average deposits increased $23,421,702 or 11.8 percent. Absent the provision related to the large credit loss and the expenses related to the opening of our new branch, our net income after tax would have increased approximately 20.0 percent over 2006."
Total revenues for 2007 were $9,649,639, increasing $842,476 or 9.6 percent, compared to the same period in the prior year. Net interest income for 2007 was $8,150,355, which was $802,762 or 10.9 percent higher than the $7,347,593 reported for 2006. Non interest income for 2007 increased $39,714 or 2.7 percent, closing the year at $1,499,284.
Non interest expense for 2007 was $6,133,386, compared to $5,471,534 for 2006. Salaries and benefits, the largest component of non interest expense, increased $242,569 or 8.3 percent over 2006.
Total revenues, consisting of net interest income and non interest income, were $2,596,811 for the fourth quarter of 2007, reflecting an increase of $323,338, or 14.2 percent, compared to the same period in 2006. Net interest income in the fourth quarter of 2007 was $2,196,912, increasing $313,326, or 16.6 percent, compared to the same quarter of 2006. The increase in net interest income in the fourth quarter of 2007 as compared with 2006 was primarily due to the higher level of average earning assets in 2007, which were $27,493,967 higher than in 2006, and a net interest margin of 3.47 percent in 2007 compared to 3.34 percent in 2006.
Non interest expense for the fourth quarter of 2007 was $1,791,592, increasing 22.8 percent from $1,459,595 in the same period a year ago. The increase in non interest expense was partially due to additional compensation and benefits, occupancy and equipment, marketing, supplies, data processing, and other expenses related to the opening of our new branch.
Total assets at December 31, 2007, were $267,828,685, compared to $242,759,305 at the same date a year ago, an increase of $25,069,380 or 10.3 percent. Loans grew $26,680,536 or 12.5 percent and reached $239,392,126 at December 31, 2007, compared to $212,711,590 at December 31, 2006. Total deposits at December 31, 2007, were $239,182,947, reflecting an increase of $24,369,516, or 11.3 percent over the corresponding total a year ago.
Loan charge-offs were $2,554,110 during 2007, of which $2,437,540 was related to one commercial credit relationship. Non performing loans at December 31, 2007, were $2,242,794 or 0.94 percent of total loans. The allowance for loan losses was $3,116,767 at December 31, 2007, or 1.30 percent of total outstanding loans.
Mr. Sutton commented, "As mentioned earlier, time will tell if our conservative approach was warranted with respect to our non performing credit relationships. We remain committed to a strong credit culture which has served us well since we opened in July, 2001, and remains the cornerstone of our operating philosophy. In our first five and one-half years of business, through 2006, we recorded only $68,000 of write offs."
Shareholders' equity increased 4.1 percent during 2007, ending the year at $19,527,194. The Company remains "well capitalized" with a Tier I capital ratio of 10.0 percent at December 31, 2007.
Mr. Sutton concluded, "On November 13 we opened our North Side office at the corner of Highway 41 and Boonville-New Harmony Road. This banking center will add convenience to our existing clients as well as allow us to expand our footprint in the Evansville market. To date, deposit generation has exceeded our expectations. We believe this investment will serve us well over time and should be a key contributor to our core deposit base."
American Community Bancorp, Inc., through its wholly owned subsidiary, Bank of Evansville, provides a full range of commercial and consumer banking services in the Evansville, Indiana, area.
This news release contains certain forward-looking statements. These forward-looking statements may be identified by the use of such forward- looking terminology as "expect," "believe," "plan," "anticipate," "may," "will" or similar statements or variations of such terms or otherwise express views concerning trends and the future. Forward-looking statements involve risks and uncertainties which could cause our results to differ materially from such forward-looking statements. We assume no obligation for updating any such forward-looking statement at any time.
AMERICAN COMMUNITY BANCORP, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) December 31, December 31, 2007 2006 ASSETS Cash and due from banks $5,541,754 $4,351,163 Interest bearing balances with banks 36,324 23,967 Federal funds sold 4,458,000 8,465,000 Total cash and cash equivalents 10,036,078 12,840,130 Securities available for sale, at fair value 9,202,756 9,886,563 Nonmarketable equity securities 1,168,150 1,060,450 Loans, net of deferred fees 239,392,126 212,711,590 Allowance for loan losses (3,116,767) (3,063,600) Net loans 236,275,359 209,647,990 Premises and equipment 7,201,642 5,962,624 Other assets 3,944,700 3,361,548 Total assets $267,828,685 $242,759,305 LIABILITIES AND SHAREHOLDERS' EQUITY Deposits Non interest bearing $18,356,944 $19,765,202 NOW, MMDA and Savings 106,895,642 110,148,954 Time deposits 113,930,361 84,899,275 Total deposits 239,182,947 214,813,431 Long term debt 8,248,000 8,248,000 Accrued expenses and other liabilities 870,544 941,250 Total liabilities 248,301,491 224,002,681 SHAREHOLDERS' EQUITY Common stock, no par value, 3,000,000 shares authorized; issued and outstanding 1,781,039 and 1,772,404 19,145,765 17,532,198 Undivided profits 419,910 1,379,322 Accumulated other comprehensive income (loss) (38,481) (154,896) Total shareholders' equity 19,527,194 18,756,624 Total liabilities and shareholders' equity $267,828,685 $242,759,305 AMERICAN COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, except Year Ended December 31, 2006) Three months ended Years ended December 31, December 31, Interest income: 2007 2006 2007 2006 Interest and fees on loans $4,338,611 $4,028,576 $16,997,752 $14,921,356 Securities: U.S. government agencies and corporations 92,643 98,377 382,738 401,394 Other securities 15,788 14,862 62,218 58,531 Federal funds sold 53,266 96,086 398,081 423,056 Deposits with other banks 258 244 1,093 692 Total interest income 4,500,566 4,238,145 17,841,882 15,805,029 Interest expense: Deposits 2,154,284 2,199,844 9,090,866 7,872,285 Federal funds purchased 368 53 708 1,727 Borrowings 149,002 154,662 599,953 583,424 Total interest expense 2,303,654 2,354,559 9,691,527 8,457,436 Net interest income 2,196,912 1,883,586 8,150,355 7,347,593 Provision for loan losses 2,448,977 125,000 2,606,977 397,418 Net interest income after provision (252,065) 1,758,586 5,543,378 6,950,175 for loan losses Non interest income: Service charges on deposit accounts 58,541 56,198 242,718 207,655 Gain on sale of loans 74,176 114,414 340,695 448,520 Merchant processing fees 206,272 174,148 710,659 650,678 Other 60,910 45,127 205,212 152,717 Total non interest income 399,899 389,887 1,499,284 1,459,570 Non interest expense: Salaries and benefits 827,814 758,090 3,161,256 2,918,687 Occupancy and equipment, net 184,138 133,753 602,068 545,284 Marketing 36,873 21,987 92,884 79,808 Data processing 113,545 87,302 387,045 329,862 Supplies, postage and printing 41,050 27,613 98,881 80,653 Legal and professional 109,101 54,464 295,510 195,398 Merchant processing expense 188,729 165,026 678,674 605,177 Other 290,342 211,360 817,068 716,665 Total non interest expense 1,791,592 1,459,595 6,133,386 5,471,534 Income before income taxes (1,643,758) 688,878 909,276 2,938,211 Income taxes (637,000) 288,100 405,421 1,202,200 Net income $(1,006,758) $400,778 $503,855 $1,736,011 Basic earnings per common share* $(0.57) $0.23 $0.28 $0.98 Diluted earnings per common share* $(0.54) $0.22 $0.27 $0.94 Average common shares outstanding* 1,776,845 1,768,007 1,776,178 1,766,133 Average diluted shares outstanding* 1,860,762 1,859,010 1,863,812 1,856,138 * Adjusted for 5 percent stock dividends paid on June 9, 2006 and June 8, 2007 AMERICAN COMMUNITY BANCORP, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) 2007 2007 2007 2007 (dollars in thousands except per share data) 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr EARNINGS Net interest income $2,197 $2,107 $1,952 $1,894 Provision for loan losses $2,449 $75 $37 $46 Non interest income $400 $358 $402 $340 Non interest expense $1,792 $1,429 $1,568 $1,345 Income taxes $(637) $391 $310 $341 Net income $(1,007) $570 $439 $502 Basic earnings per share* $(0.57) $0.32 $0.25 $0.28 Diluted earnings per share* $(0.54) $0.31 $0.24 $0.26 Average shares outstanding* 1,776,845 1,776,845 1,776,907 1,774,075 Average diluted shares outstanding* 1,860,762 1,865,609 1,867,285 1,861,553 PERFORMANCE RATIOS Return on average assets -1.53% 0.90% 0.71% 0.84% Return on average common equity -19.23% 11.17% 8.97% 10.61% Net interest margin (fully tax equivalent) 3.47% 3.45% 3.27% 3.29% Efficiency ratio 68.99% 57.98% 66.60% 60.20% Full time equivalent employees 46 46 43 42 CAPITAL Average equity to average assets 7.94% 8.08% 7.88% 7.89% Tier 1 leverage capital ratio 9.97% 10.94% 10.69% 10.71% Tier 1 risk based capital ratio 11.17% 12.09% 12.25% 11.99% Total risk based capital ratio 13.05% 13.84% 14.12% 13.93% Book value per share* $10.96 $11.51 $11.14 $10.91 Cash dividend per share - - - - ASSET QUALITY Gross loan charge offs $2,535 $19 $- $- Net loan charge offs $2,535 $19 $- $- Net loan charge offs to average loans 1.08% 0.01% - - Allowance for loan losses $3,117 $3,203 $3,147 $3,110 Allowance for losses to total loans 1.30% 1.40% 1.44% 1.44% Nonperforming loans $2,243 $347 $136 $136 Other real estate and repossessed assets $- $- $- $- Nonperforming loans to total assets 0.84% 0.13% 0.05% 0.05% END OF PERIOD BALANCES Loans $239,392 $228,762 $218,554 $216,438 Total earning assets $254,321 $249,001 $245,746 $242,988 Total assets $267,829 $260,245 $255,619 $252,095 Deposits $239,183 $230,664 $222,854 $223,381 Shareholders' equity $19,527 $20,455 $19,789 $19,388 AVERAGE BALANCES Loans $235,708 $223,727 $217,776 $211,193 Total earning assets $251,198 $240,434 $239,208 $233,207 Total assets $261,713 $250,576 $249,139 $243,024 Deposits $231,622 $221,106 $220,231 $214,595 Shareholders' equity $20,775 $20,242 $19,644 $19,175 * Adjusted for 5 percent stock dividends paid June 9, 2006 and June 8, 2007 AMERICAN COMMUNITY BANCORP, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) 2006 Years ended December 31 (dollars in thousands except per share data) 4th Qtr 2007 2006 EARNINGS Net interest income $1,884 $8,150 $7,348 Provision for loan losses $125 $2,607 $397 Non interest income $390 $1,499 $1,459 Non interest expense $1,460 $6,133 $5,472 Income taxes $288 $405 $1,202 Net income $401 $504 $1,736 Basic earnings per share* $0.23 $0.28 $0.98 Diluted earnings per share* $0.22 $0.27 $0.94 Average shares outstanding* 1,768,007 1,776,178 1,766,133 Average diluted shares outstanding* 1,859,010 1,863,812 1,856,138 PERFORMANCE RATIOS Return on average assets 0.68% 0.20% 0.77% Return on average common equity 8.47% 2.52% 9.74% Net interest margin (fully tax equivalent) 3.34% 3.38% 3.42% Efficiency ratio 64.20% 63.56% 62.13% Full time equivalent employees 42 46 42 CAPITAL Average equity to average assets 8.06% 7.95% 7.91% Tier 1 leverage capital ratio 10.81% 9.97% 10.81% Tier 1 risk based capital ratio 11.96% 11.17% 11.96% Total risk based capital ratio 14.01% 13.05% 14.01% Book value per share* $10.58 $10.96 $10.58 Cash dividend per share - - - ASSET QUALITY Gross loan charge offs $3 $2,554 $55 Net loan charge offs $3 $2,554 $55 Net loan charge offs to average loans - 1.15% 0.03% Allowance for loan losses $3,064 $3,117 $3,064 Allowance for losses to total loans 1.44% 1.30% 1.44% Nonperforming loans $21 $2,243 $21 Other real estate and repossessed assets $- $- $- Nonperforming loans to total assets 0.01% 0.84% 0.01% END OF PERIOD BALANCES Loans $212,712 $239,392 $212,712 Total earning assets $232,380 $254,321 $232,380 Total assets $242,759 $267,829 $242,759 Deposits $214,813 $239,183 $214,813 Shareholders' equity $18,757 $19,527 $18,757 AVERAGE BALANCES Loans $205,103 $222,114 $194,640 Total earning assets $223,704 $241,036 $214,938 Total assets $233,011 $251,136 $225,379 Deposits $205,222 $221,913 $198,491 Shareholders' equity $18,769 $19,960 $17,830 * Adjusted for 5 percent stock dividends paid June 9, 2006 and June 8, 2007 Contact: Michael S. Sutton, CEO John M. Schenk, CFO Phone: (812) 962-2265
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