Prineville Bancorporation (OTCBB:PNVL), parent company for Community First Bank, reported a third quarter 2008 net loss of $4.6 million, or $1.83 per share, compared to net income of $440,000, or 19 cents a share, in the year-ago quarter. Third quarter 2008 earnings include a $7.15 million (pre-tax) provision for credit losses with net loan charge-offs of $6.1 million (pre-tax). Accordingly, the Reserve for Credit Losses increased to 2.1% of total loans at September 30, 2008, up from 1.4% for the second quarter.
Robin Freeman, President & CEO, stated, "The loss was a result of loan charge-offs and an increase to the allowance for loan losses in the quarter in recognition of the deterioration in collateral values for residential land and land held for future development in central Oregon. Losses were primarily concentrated in this development portfolio, and we believe that credit quality issues are confined to these categories. We have performed a review of the loan portfolio, and while there will be continued economic stress nationally and locally, we anticipate that future losses will be manageable."
"While we are disappointed with the loss, Community First Bank, which was founded in central Oregon to serve the local community, remains committed to serving the needs of local people and businesses. As part of this commitment to Central Oregon, we assisted many of our customers through their growth and are now working with them through their challenges. We are faced with the challenges that many of our customers are facing daily in their personal and professional lives requiring tough business decisions. Ultimately, the decisions we have made and continue to make will create a better bank and will allow us to move through the end of this year and into the next year with renewed resources, renewed enthusiasm, and the renewed ability to serve our Central Oregon market. "
Significant items as of September 30, 2008, are as follows:
- A year-to-date loss of $4.8 million ($1.89 per share) for the first nine months of 2008 compared with net income of $1.3 million in the first nine months of 2008.
- Loan loss provision for the second quarter of $7.15 million, an increase of $6.7 million from the second quarter of 2008.
- Allowance for Loan and Lease Losses (ALLL) increased to $3.35 million or 2.1% of outstanding loans.
- The bank remains adequately capitalized under regulatory standards.
- Total assets were $210 million as of September 30, 2008 - an increase of 7.2% from September 30, 2007, and a decrease of 1.9% from June 30, 2008.
- Net loans were $155.3 million as of September 30, 2008 - an increase of 0.53% from September 30, 2007, and a decrease of 7.68% from June 30, 2008.
- Total deposits were $172.8 million as of September 30, 2008 - an increase of 13.2% from September 30, 2007, and an increase of 3.2% from June 30, 2008.
Andy Phillips, Executive Vice President and Chief Credit Officer, added that "after improvement in the second quarter, the level of past due and non-performing assets increased as of September 30, 2008. We are focused on reducing non-performing assets in the fourth quarter of 2008. Loan portfolio growth will likely be minimal until the economy recovers, but the bank will continue to seek new opportunities to assist our customers and our local communities. We are going to seize the opportunity before us and position ourselves alongside our customers to emerge a stronger bank that is prepared to provide continued support to our customers and community in a time when the support of a local bank is needed the very most."
John Hajovsky, Executive Vice President and Chief Operating Officer, commented, "Reflective of our community and customer focus, the bank continued to experience growth in customer relationships and deposits in the third quarter. Recently published FDIC deposit data as of June 30, 2008, reflects year-over-year market share growth for Community First Bank."
To learn more, please visit our Investor Relations page on our website at www.MyCommunityFirst.com.
Prineville Bancorporation is the holding company for Community First Bank, which operates eight bank branches located in Prineville, Bend (3), Redmond, La Pine, Terrebonne and Madras, Oregon. Residential mortgage services are also offered through all bank branches. In addition investment and trust services are offered through Community First Investments.
FORWARD-LOOKING STATEMENTS
The statements contained in this release that are not historical facts are forward-looking statements based upon management's current expectations and beliefs concerning future developments and their potential effect on Prineville Bancorporation. There can be no assurances that future developments affecting Prineville Bancorporation will be the same as those anticipated by management.
Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve risks and uncertainties. These risks and uncertainties include, but are not limited to: (1) competitive pressures in the banking and financial industries; (2) changes in interest rate environment; (3) general economic conditions, nationally, regionally, and in operating markets; (4) changes in regulatory environment; (5) changes in business conditions and inflation; (6) changes in securities markets; and (7) future credit loss experience.
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PRINEVILLE BANCORP | ||||||
Consolidated Information | ||||||
Dollars in Thousands |  |  |  |  |  |  |
Unaudited |  | 2008 |  |  | 2007 |  |
Income Statement | 9/30/2008 | 9/30/2007 | ||||
 | ||||||
Interest Income | 9,740 | 10,957 | ||||
Interest Expense | 4,340 | 4,432 | ||||
Net Interest Income | 5,399 | 6,525 | ||||
Provision for Loan Losses | 7,696 | 315 | ||||
Net interest margin after loan loss | (2,297 | ) | 6,210 | |||
Non-Interest Income | 1,640 | 1,502 | ||||
Non-Interest Expense | 7,315 | 5,811 | ||||
Provision for Income Taxes |  | (3,185 | ) |  | 623 |  |
Net Income |  | (4,787 | ) |  | 1,278 |  |
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Net income per share (2)(3)(4) | ($1.89 | ) | $ | 0.51 | ||
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Balance Sheet | ||||||
Assets | ||||||
Cash and due from banks | 5,385 | 4,206 | ||||
Investments | 24,159 | 24,530 | ||||
Federal Home Loan Bank and Reserve Bank stock | 1,174 | 953 | ||||
Loans, net of allowance for loan losses and unearned income | 155,260 | 154,439 | ||||
Bank premises and equipment, net of depreciation and amortization | 8,589 | 5,738 | ||||
Cash surrender value of life insurance | 1,185 | 1,146 | ||||
Accrued interest and other assets |  | 14,228 |  |  | 4,828 |  |
Total Assets |  | 209,980 |  |  | 195,840 |  |
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Liabilities and Stockholders' Equity | ||||||
Deposits | 172,763 | 152,579 | ||||
Repurchase Agreements | 6,682 | 9,476 | ||||
Federal Home Loan Bank and other borrowings | 21,690 | 16,650 | ||||
Accrued interest payable and other liabilities |  | (3,155 | ) |  | 1,087 |  |
Total Liabilities | 197,980 | 179,792 | ||||
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Common Stock | 5,374 | 9,566 | ||||
Additional paid-in capital | 10,685 | 4,751 | ||||
Retained earnings | (3,849 | ) | 2,104 | |||
Receivable from ESOP | (195 | ) | (286 | ) | ||
Accumulated other comprehensive loss |  | (15 | ) |  | (87 | ) |
Total Stockholders' Equity | 12,000 | 16,048 | ||||
 |  |  |  |  |  | |
Total Liabilities and Stockholders' Equity |  | 209,980 |  |  | 195,840 |  |
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Book Value per Share (1)(5) | $ | 4.73 | $ | 6.39 | ||
Shares outstanding - end of period (3)(4) | 2,539,269 | 2,510,791 | ||||
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(1) Including Unrealized Gain/Loss on Available | ||||||
for Sale Securities | ||||||
(2) Based upon weighted average number of shares outstanding | ||||||
(3) Adjusted for stock dividend paid 12/2007 | ||||||
(4) Adjusted for 2 for 1 Stock Split in August 2007 | ||||||
(5) Based upon number of shares outstanding at | ||||||
the end of the period |