SAN LUIS OBISPO, Calif., Jan. 28, 2011 /PRNewswire/ -- American Perspective Bank (BULLETIN BOARD: APBA) (the "Bank") today announced fourth quarter and year to date financial results through December 31, 2010. Net income during the fourth quarter of 2010 was $165 thousand, or $0.04 diluted earnings per share. Net income during the fourth quarter of 2009 was $241 thousand, or $0.06 diluted earnings per share. Net income during the third quarter of 2010 (the immediately preceding quarter) was $24 thousand, equivalent to $0.01 diluted earnings per share. Net income for the full year of 2010 was $478 thousand, or $0.11 diluted earnings per share. This compares to a loss of $1.7 million during 2009, equivalent to $(0.40) per share.
The Bank reported record levels of total assets, net loans, and deposits as of December 31, 2010. Total assets rose from $203.0 million at December 31, 2009 to $228.9 million at December 31, 2010, supported by ongoing inflows of deposits. Net loans increased from $137.4 million at December 31, 2009 to $164.5 million at December 31, 2010, as the gradually improving economy and the Bank's continuing efforts to attract clients from competing financial institutions both contributed to the increase. Total deposits rose from $152.3 million at December 31, 2009 to $176.0 million at December 31, 2010, with the rise concentrated in money market and demand deposit accounts. The $4.2 million in deposit growth during the fourth quarter of 2010 was supported by the Bank's branch in Santa Maria, which opened on July 21, 2010.
At December 31, 2010, the Bank's: (i) Tier One Leverage regulatory capital ratio was 17.74%; (ii) Tier One Risk-Based regulatory capital ratio was 22.58%; and (iii) Total Risk-Based regulatory capital ratio was 23.83%. All of these ratios were significantly in excess of the levels required to be categorized in the highest regulatory capital classification of "well capitalized". The Bank's capital ratio profile continues to be one of the strongest for banks headquartered in San Luis Obispo and Santa Barbara counties.
Financial Condition Analysis
Cash and cash equivalents decreased from $4.9 million at December 31, 2009 to $2.4 million at December 31, 2010. In recent periods, the Bank has worked to minimize its excess cash and cash equivalents in light of the very low yields available for such assets in the current capital markets environment. The Bank has instead invested available on balance sheet liquidity into its securities portfolio; with aggregate liquidity also supported by the Bank's borrowing capacities with the Federal Home Loan Bank of San Francisco ("FHLB"), the Federal Reserve Bank of San Francisco ("FRB"), correspondent banks, and other counterparties.
Total securities available for sale decreased from $56.0 million at December 31, 2009 to $52.6 million at December 31, 2010. During the second, third, and fourth quarters of 2010, the Bank sold mortgage backed securities and purchased variable rate collateralized mortgage obligations in conjunction with its interest rate risk management program. In light of the current status of the capital markets, the Bank reallocated asset duration from securities to loans, including income property loans with initial fixed interest rate periods of two to five years.
The combination of the security sales plus monthly principal payments resulted in mortgage backed securities declining from $51.2 million at December 31, 2009 to $17.5 million at December 31, 2010. In contrast, collateralized mortgage obligations increased from $4.8 million at December 31, 2009 to $35.0 million at December 31, 2010. The Bank's portfolio of collateralized mortgage obligations at December 31, 2010 was almost entirely comprised of floating rate tranches that reprice monthly based upon a margin over the 1 month LIBOR index. All of the Bank's securities at December 31, 2010 were AAA rated U.S Agency issued securities. The fair value of the Bank's $52.6 million in securities at December 31, 2010 exceeded its amortized cost basis by $547 thousand.
Net loans increased from $137.4 million at December 31, 2009 to $164.5 million at December 31, 2010. The Bank experienced particularly strong loan demand during the fourth quarter of 2010, leading to a $16.6 million rise in net loans during the three months ended December 31, 2010. Loan originations during the fourth quarter of 2010 included an increased volume of loans under various U.S. Small Business Administration and U.S. Department of Agriculture loan programs (where a portion of the credit is guaranteed by a U.S. Agency), in addition to a significant number of loans extended to local businesses and professionals. The Bank had a single farm real estate loan outstanding at December 31, 2009 that paid off in full during 2010. At both December 31, 2009 and December 31, 2010, the Bank had no residential, closed-end mortgages on its balance sheet.
Commenting on the fourth quarter lending activity, Mark A. Crawford, the Bank's Chief Credit Officer, stated: "As a result of the Bank's ongoing involvement in our local communities, advertising and marketing programs, officer and director calling efforts, and sponsorship of various community events and organizations, the Bank has attained enhanced visibility in our primary market area stretching from Paso Robles in the north to Santa Maria in the south. We were very pleased with the new business referrals generated by our clients during the fourth quarter of 2010, as they spread the word regarding the Bank's strong capital position, customized financial solutions, and capacity to lend to qualified borrowers." Mr. Crawford then added: "The Bank is currently pursuing opening a loan production office in Paso Robles, targeted for the second quarter of 2011. This initial physical presence in north San Luis Obispo County will allow us to even better assist our shareholders and clients in that area. Our vision is to convert the loan production office into a full service branch office once we attain a sufficient volume of local business to render the branch office cost effective."
The Bank's investment in the capital stock of the FHLB increased from $757 thousand at December 31, 2009 to $1.1 million at December 31, 2010 due to the Bank's growth and the standard asset-based investment requirement applicable to FHLB members.
Premises and equipment, net, increased from $1.4 million at December 31, 2009 to $1.7 million at December 31, 2010 primarily due to the leasehold improvements and furniture, fixtures, and equipment associated with the new Santa Maria branch.
Other real estate owned increased from none at December 31, 2009 to $4.5 million at December 31, 2010. The $4.5 million was comprised of three properties in the Bank's primary market area, two of which are owned by limited liability company subsidiaries of the Bank. Rental income was collected from two of the foreclosed properties during the fourth quarter of 2010.
One of the foreclosed properties, with a book value of $116 thousand at December 31, 2010, was sold during January 2011, with net sales proceeds slightly below the Bank's book value. A second of the foreclosed properties, with a book value of $1.8 million at December 31, 2010, is currently in escrow, with the sale anticipated to close during the first quarter of 2011. The forecasted net sales proceeds for this property are projected to approximate the Bank's book value at December 31, 2010.
The third foreclosed property is the subject of a title insurance claim and a lawsuit by the Bank against the title insurance company in response to issues with the processing of the subject escrow and the title insurance policy issued to the Bank. A legal action is in process to address the intervening liens associated with the prior owner that were not removed through the foreclosure and other actions. A Bank subsidiary has sole ownership of the subject property (4 parcels comprising approximately 237 acres, including one house), subject to the remaining intervening liens. The Bank intends to continue to vigorously pursue the title insurance company to hold the Bank financially harmless from errors that occurred through the escrow process.
The ratio of allowance for loan losses to loans outstanding decreased from 1.78% at December 31, 2009 to 1.46% at December 31, 2010. The primary reason for this decrease was an overall improvement in the credit profile of the outstanding loan portfolio, as: (i) the Bank had no loans on non-accrual status at December 31, 2010, versus $6.6 million of non-accrual loans at December 31, 2009; (ii) certain loans experienced an improvement in credit profile during 2010, leading to a lower associated general reserve requirement; (iii) the Bank originated a greater volume of loans guaranteed in part by U.S. Government Agencies in 2010 ($4.9MM in guaranteed balances outstanding at December 31, 2010), with such loans requiring comparatively lower loan loss reserves than similar loans without such guarantees; (iv) the Bank had no loans that were 30 days or more delinquent at December 31, 2010; (v) the Bank had only one troubled debt restructured loan at December 31, 2010, with an associated net investment of $45 thousand; and (vi) relatively few loans experienced a significant deterioration in credit profile during 2010.
The Bank recorded net charge-offs of $1.3 million during 2010, none of which occurred during the fourth quarter of 2010. The charge-offs were primarily associated with loans for which the collateral was foreclosed upon and transferred to other real estate owned by December 31, 2010. The Bank records other real estate owned at fair value less estimated cost to sell. All three of the foreclosed properties at December 31, 2010 experienced a decline in market value since the origination of the subject loans.
Non-interest bearing demand deposit balances increased from $18.5 million at December 31, 2009 and from $19.0 million at September 30, 2010 to a record $23.1 million at December 31, 2010. Demand deposit balances during the fourth quarter of 2010 benefited from the Bank's opening a significant number of new accounts for local businesses and professionals.
Interest bearing checking accounts decreased from $3.3 million at December 31, 2009 to $1.9 million at December 31, 2010. Part of this decrease was associated with one large client's transferring funds from interest bearing checking to money market deposit accounts in light of the yield differential.
Savings deposits increased from $77 thousand at December 31, 2009 to $733 thousand at December 31, 2010. This rise was primarily associated with new retirement (e.g. IRA) savings accounts following the Bank's introduction of that product during the first quarter of 2010.
Money market deposits increased from $74.9 million at December 31, 2009 to $95.0 million at December 31, 2010. Money market deposit balances during 2010 benefited from:
-- low (often, near zero) interest rates being paid on brokerage accounts and money market mutual funds, thereby encouraging clients to transfer their funds to higher yielding and FDIC insured accounts; -- the desire by certain clients to keep their funds liquid given the uncertain economic environment; -- the conversion of certain deposits from certificates of deposit to money market accounts given the limited yield differential between the products in the current interest rate environment; -- the Bank's offering tiered pricing on its money market accounts, whereby clients receive a higher interest rate on their entire account balance as each successively higher balance tier level is attained; and -- inflows into the Bank's public funds money market product.
Certificates of deposit decreased slightly from $55.5 million at December 31, 2009 to $55.2 million at December 31, 2010. Certificates of deposit declined by $2.0 million during the fourth quarter of 2010 primarily due to: (i) transfers from certain maturing certificates of deposit into money market accounts; and (ii) the Bank's decision to return the funds associated with certain maturing wholesale certificates of deposit in light of the Bank's liquidity profile and the relative yields available in the capital markets.
Commenting on the Bank's recent deposit performance, Thomas R. Strait, the Bank's Director of Retail Banking, stated: "Deposit acquisition during 2010 was supported by many initiatives, as we continue to invest in our product set and delivery platform. We are pleased to now offer our clients mobile banking from a wide array of smartphones and other personal digital assistants, plus customized email and text message alerts for their deposit accounts. We enter the upcoming retirement deposit season with a full set of products, including a liquid IRA account." Mr. Strait then added: "The Santa Maria community has welcomed our new branch. We look forward to introducing more local businesses and professionals to our Santa Maria branch in 2011, including through the availability of the facility for client and community organization meetings."
Borrowings increased from $10.5 million at December 31, 2009 to $12.0 million at December 31, 2010. The rise was primarily due to the Bank's borrowing additional funds from the FHLB during the latter part of the fourth quarter in conjunction with clients seeking to close a number of real estate loan transactions just before the end of the year.
Shareholders' equity rose from $39.2 million at December 31, 2009 to $39.9 million at December 31, 2010. The increase was due to the 2010 net income and the capital generated through the Bank's Restricted Share Plan. Nominal and tangible book values were $9.20 per share at December 31, 2010 versus $9.15 per share at December 31, 2009. Shares of common stock outstanding rose by 61,573 during 2010 in conjunction with the vesting of awards under the Restricted Share Plan. The Bank grants restricted share awards to employees as a means of encouraging an ownership orientation and aligning employee interests with the generation of shareholder value.
Operating Results Analysis
Net interest income before the provision for loan losses increased from $1.8 million during the fourth quarter of 2009 to $2.1 million during the fourth quarter of 2010. This increase was primarily generated through a larger average balance sheet, as the ratio of annualized net interest income to average total assets was 3.67% during the fourth quarter of 2010 versus 3.75% during the fourth quarter of 2009. Net interest income before the provision for loan losses during 2010 totaled $7.5 million, comparing favorably to $6.6 million during 2009. The improvement in full year net interest income in 2010 compared to 2009 was also primarily generated by a larger average balance sheet, as the ratio of annualized net interest income to average total assets declined from 3.73% for 2009 to 3.55% for 2010. However, the ratio of annualized net interest income to average total assets rose from 3.37% during the third quarter of 2010 to 3.67% during the fourth quarter of 2010, as the Bank achieved progress in reducing its cost of funding and in shifting its asset mix towards loans.
The Bank's ratio of annualized net interest income to average total assets was constrained in 2010 by several factors, including:
-- the historically low interest rate environment, which has led to spread compression since funding costs cannot be lowered below zero and because the yields for certain assets, particularly for cash equivalents and benchmark securities, have declined to record low levels; -- the Bank's asset mix, with net loans, the Bank's highest yielding interest earning assets, comprising 68.2% of average total assets during 2010, versus a targeted level of approximately 75.0% (noting that this ratio stood at 71.9% at December 31, 2010); -- the decisions by the Federal National Mortgage Association ("Fannie Mae") and the Federal Home Loan Mortgage Corporation ("Freddie Mac") to repurchase en mass delinquent loans from their hybrid mortgage backed security pools, leading to accelerated purchase premium amortization (and, hence, lower effective yields) for the Bank's mortgage backed securities portfolio; and -- the impact during the year of non-performing assets (all of which was composed of other real estate owned at December 31, 2010).
On the other hand, during 2010, the Bank has been successful in continuing to gradually reduce its weighted average cost of deposits, despite already being at a nominally and historically low level (1.36%) at December 31, 2009. The Bank's weighted average cost of deposits during the fourth quarter of 2010 was 1.09% despite the Bank's proactive steps to increase the duration of the certificate of deposit portfolio during 2010 in conjunction with its interest rate risk management program. The FDIC's imposition of deposit rate caps on troubled financial institutions, the industry-wide contraction in lending, and the limited competition from money market mutual funds have all contributed to a less competitive environment for deposit pricing than in certain prior periods.
The provision for loan losses was $277 thousand and $1.3 million during the three and the twelve months ended December 31, 2010, respectively, declining from $299 thousand and $3.5 million during the three and twelve months ended December 31, 2009. The provision for loan losses was $386 thousand during the third quarter of 2010 (the immediately preceding quarter). The provision for loan losses was lower in 2010 compared to 2009 primarily due to a small number of loans that experienced significant credit deterioration during 2009. The fourth quarter 2010 provision for loan losses reflects: (i) increases in formula reserves in conjunction with the greater volume of loans outstanding; (ii) increased general reserves for certain home equity lines of credit where there has been a decrease in the market value of the residential real estate collateral since origination; and (iii) the Bank's increasing its unallocated reserve associated with credit concentrations in light of the volume of local commercial real estate lending that occurred during the fourth quarter of 2010.
The Bank realized a gain of $153 thousand on the sale of a hybrid agency mortgage backed security during the fourth quarter of 2010. The Bank realized a gain of $47 thousand on the sale of a similar security during the fourth quarter of 2009, which was the Bank's only security sale in 2009. For the full year 2010, the Bank realized $570 thousand in gains on the sales of securities.
Other non-interest income totaled $27 thousand during the fourth quarter of 2010, down slightly from $31 thousand during the fourth quarter of 2009. Other non-interest income was $107 thousand during 2010, comparing favorably to $91 thousand during 2009. The Bank is gradually augmenting its fee income as it builds its client base and more clients select fee based services such as ACH origination, positive payment, and online wire request.
Income and expenses associated with other real estate owned have impacted the Bank's financial results in 2010. No foreclosed property was sold during the fourth quarter of 2010. The sale of a motel in June 2010 produced a loss on sale of $105 thousand, accounting for all of the Bank's 2010 loss on sale of other real estate owned. The Bank recorded $310 thousand in post-acquisition valuation allowances during the fourth quarter of 2010 that were associated with two of the three foreclosed properties owned by the Bank at December 31, 2010. These valuation allowances were recognized in response to market feedback in conjunction with the Bank's marketing the properties for sale. For all of 2010, post-acquisition valuation adjustments for other real estate owned totaled $598 thousand, versus none during 2009. Other real estate owned generated net operating expense of $28 thousand during the fourth quarter of 2010, but net operating income of $8 thousand for all of 2010 primarily due to the (now sold) motel's experiencing peak seasonal room demand during the first quarter of 2010. The Bank did not have any operating income or expense for foreclosed real estate during 2009.
Non-interest expense (excluding other real estate owned expense) increased from $1.3 million during the fourth quarter of 2009 to $1.5 million during the fourth quarter of 2010; and from $5.0 million during 2009 to $5.8 million during 2010. Two factors that contributed significantly to the rise in non-interest expense from the 2009 periods to the 2010 periods were the commencement of expenses (e.g. salaries, rent, insurance) for the new Santa Maria branch starting in the first quarter of 2010 and higher credit collection costs (especially legal fees) in 2010 versus 2009.
Compensation and employee benefits expenses rose from $601 thousand during the fourth quarter of 2009 to $735 thousand during the fourth quarter of 2010; and from $2.4 million during 2009 to $2.9 million during 2010. Factors contributing to these increases other than the aforementioned hiring for the Santa Maria branch included:
-- The hiring of additional employees (other than for Santa Maria) in light of the historic and planned growth of the Bank. -- Increased benefits expenses, primarily due to higher costs for medical insurance sponsored by the Bank. While the Bank took multiple steps to moderate its medical insurance costs in 2010, such were insufficient in aggregate to fully offset the significant premium increases implemented throughout the marketplace. -- Base salary increases granted to non-executive employees effective October 1, 2009 (executives received no base salary adjustments in 2009 or 2010). The Bank's Board of Directors postponed annual base salary adjustments for non-executive employees from October 1, 2010 to January 1, 2011 as a cost savings measure. -- Increased expense for the Bank's Restricted Share Plan, as the Bank continues to provide restricted share awards to all employees soon following hire as a means of fostering an ownership orientation.
The Bank did not establish any accrual for incentive compensation for 2010 in light of the decision by the Board of Directors to not provide bonus payments to employees until the Bank's profitability further improves.
Accounting, legal, and consulting expenses totaled $132 thousand during the fourth quarter of 2010, down from $215 thousand during the fourth quarter of 2009. Accounting, legal, and consulting expenses decreased slightly from $656 thousand during 2009 to $651 thousand during 2010. Aggregate legal expenses were elevated during 2010 (totaling $329 thousand versus $252 thousand in 2009) primarily due to the costs associated with collecting troubled loans, including the expenses associated with foreclosing on two properties during the third quarter of 2010. Consulting expenses in the 2009 periods were increased by the Bank's retaining a consultant to perform credit administration functions for a number of months until the Bank hired its current Chief Credit Officer in late December 2009. While legal collection costs moderated in the fourth quarter of 2010 following the Bank's foreclosure earlier in the year of the collateral securing its then non-accrual loans, legal collection costs for the full year of 2010 were substantially higher than for 2009. Accounting costs moderated in 2010 versus 2009 periods primarily due to the Bank's negotiating more favorable pricing for internal audit services in 2010; partially offset by higher attestation audit and tax compliance assistance expenses.
Occupancy expense increased from $126 thousand and $505 thousand during the three and twelve months ended December 31, 2009, respectively, to $171 thousand and $645 thousand for the three and twelve months ended December 31, 2010, respectively. These increases were primarily due to the occupancy expense associated with the new Santa Maria branch location.
Regulatory assessments increased from $77 thousand during the three months ended December 31, 2009 to $84 thousand during the three months ended December 31, 2010. This was primarily due to the Bank's continuing rise in base FDIC insurance expense associated with the growth of the deposit portfolio. Regulatory assessments totaled $321 thousand for 2010, up slightly from $314 thousand for 2009, as the impact of the second quarter 2009 FDIC special assessment ($67 thousand) offset the effect of higher base FDIC assessments associated with the larger deposit portfolio in 2010.
Equipment expense increased from $49 thousand and $190 thousand during the three and twelve months ended December 31, 2009, respectively, to $57 thousand and $219 thousand for the three and twelve months ended December 31, 2010, respectively. These increases were primarily due to: (i) the equipment expense associated with the new Santa Maria branch location; and (ii) the Bank's continuing investment in new technologies to further enhance its range of products and services.
Data and item processing expenses increased from $52 thousand and $204 thousand during the three and twelve months ended December 31, 2009, respectively, to $64 thousand and $225 thousand during the three and twelve months ended December 31, 2010, respectively. These increases arose from the Bank's processing a greater number of accounts and transactions in the 2010 periods and from the Bank's ongoing investment in new technologies. During the first quarter of 2011, the Bank plans to implement a significant enhancement to its electronic bill payment service. This follows the Bank's introduction of mobile banking (account access via smartphone or other personal digital assistant) during the fourth quarter of 2010.
Director expenses declined from $39 thousand during the fourth quarter of 2009 to $1 thousand during the fourth quarter of 2010, and from $133 thousand during 2009 to $40 thousand during 2010. These reductions were due to the March 2010 vesting of the only restricted share award ever provided to outside directors. Those awards vested one year following grant. The Bank's directors determined to not grant any new restricted share awards to directors in 2010 in support of the Bank's earnings. The Bank's Board members have never received cash director fees.
Advertising and promotion expense increased from $22 thousand and $80 thousand during the three and twelve months ended December 31, 2009, respectively, to $45 thousand and $236 thousand during the three and twelve months ended December 31, 2010, respectively. The Bank significantly increased its advertising and promotion expense during 2010 in support of:
-- its new retirement deposit account product line (e.g. both liquid and term IRA deposits); -- introducing new officers to the Bank's primary market; -- commencing the introduction of the Bank to the north San Luis Obispo County market; -- facilitating the adoption of the new name and the opening of the Santa Maria branch; -- implementing an enhanced web site; and -- supporting a wider range of community events and organizations.
Now that the Bank's primary markets are familiar with its new name and since the Santa Maria branch has now been open for six months, the Bank plans in 2011 to reorient its advertising and promotion budget to more heavily emphasize the Bank's participation in and support of local community events and organizations; with a reduced expense allocation to media advertising. The Bank wishes to support the many hours volunteered to local organizations by its employees and directors in enhancing the quality of life on the Central Coast. In this regard, Thomas J. Beene, the Bank's President and Chief executive Officer, stated: "The Bank has continued to expand its outreach to a wide variety of community groups, events, and causes as part of our being a locally owned and managed financial institution."
The Bank's 2011 Annual Meeting of Shareholders will take place on Tuesday, June 7, 2011 in the Garden Room at the Madonna Inn in San Luis Obispo. A social reception with appetizers and refreshments will commence at 5:30 PM Pacific Time, with the formal segment of the Meeting starting at 6:30 PM Pacific Time. Shareholders of record at the close of business on April 11, 2011 will be entitled to attend and vote at the Meeting. Shareholders are welcome to contact the Bank with any questions regarding the Meeting.
Commenting on the Bank's financial and operating results for 2010, Thomas J. Madden, the Bank's Chairman of the Board, stated: "We are very pleased to announce record levels of loans, deposits, and total assets at December 31, 2010. We are also pleased to report the completed sale of one of the Bank's three foreclosed properties, with a second foreclosed property currently in escrow for sale. These events provide the Bank with a strong positive trend heading into 2011." Mr. Madden then continued: "At a time when many competitors are reporting significant issues and the FDIC closed 157 financial institutions in 2010, we are pleased to report the Bank's being profitable, with a very strong capital position and ample liquidity."
Michael D. Bouquet, the Bank's Vice Chairman of the Board, added: "The Board of Directors remains deeply committed to enhancing shareholder value. The multiple steps taken in 2010 to support shareholder value, including the limited compensation for directors, the delay in employee annual base salary adjustments, the second consecutive year of no raises for our executive management team, and the Bank's not paying any bonuses, highlight our focus on effectively representing the interests of our shareholders. At the same time, the favorable momentum with which the Bank enters 2011 should provide the opportunity to financially recognize the many significant contributors to the Bank's success since opening for business just over 3 years ago." Mr. Bouquet then commented in regards to the Santa Maria branch: "I have enjoyed introducing many local business owners and professionals to the Bank's newest facility and our Santa Maria employee team, led by Senior Relationship Manager Mike Sell. It is clear that the Bank is presenting a unique and valued banking experience in the Santa Maria Valley."
Paul S. Viborg, a director of the Bank and owner of Viborg Sand and Gravel, headquartered in north San Luis Obispo County, stated: "I've had the pleasure of meeting with a large number of the Bank's clients and shareholders from north San Luis Obispo County over the past year. The Bank's upcoming opening of a loan production office in Paso Robles will greatly facilitate the Bank's meeting the credit needs of local businesses and professionals. The new office also integrates well with the Bank's expanded capabilities under various government guaranteed lending programs, thereby making credit available to earlier stage companies than would otherwise be the case."
Mark R. Andino, the Bank's Chief Financial Officer and Chief Operating Officer, commented: "The significant inflow of business into the Bank during the fourth quarter of 2010 stemmed from a variety of factors, including the Bank's becoming increasingly well known throughout its primary market area, word of mouth regarding the Bank's strong capital position and capacity to lend, and referrals from clients who have been very satisfied with the advanced level of customization the Bank provides. It has been my pleasure to design unique financial solutions for our clients, with those solutions involving a wide range of cash management, technology, and account integration features. It has also been professionally rewarding to assist clients virtually 24 / 7, from emergency cash needs to arranging overseas payments. A Bank officer is available via our 'Officer on Call' service around the clock - just another way we demonstrate our commitment to providing a concierge level of service."
The Bank's target markets are commercial enterprises, professionals, real estate investors, family business entities, and residents in San Luis Obispo County and northern Santa Barbara County. The Bank's San Luis Obispo office is located at 4051 Broad Street, Suite 140, San Luis Obispo, California, near the intersection of Broad Street (Highway 227) and Tank Farm Road. The Bank's Santa Maria office is located at 2646 Santa Maria Way, Suite 101, Santa Maria, California, near the intersection of Santa Maria Way and Broadway. The Bank's deposits are insured by the FDIC up to applicable legal limits.
Certain of the statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intend," "estimate," "target," "plans," "may increase," "may fluctuate," "may result in," "are projected," and similar expressions. The Bank's actual results may differ materially from those included in the forward-looking statements. These forward-looking statements involve risks and uncertainties including, but not limited to, the economic, business, and real estate market conditions in the Bank's market areas, the interest rate environment, competition, regulatory and legislative actions, the possibility that the Bank will not be successful in achieving its strategic objectives, the performance and contributions of employees and directors, and other factors. The Bank does not undertake, and specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
This news release is available at the http://www.americanperspectivebank.com/ Internet site for no charge.
For further information contact: -------------------------------- Thomas J. Beene President Chief Executive Officer (805) 547 - 2831 Tom.Beene@AmericanPerspectiveBank.com Or Mark R. Andino Chief Financial Officer Chief Operating Officer (805) 547 - 2832 Mark.Andino@AmericanPerspectiveBank.com General communication: ---------------------- SERVICE@AMERICANPERSPECTIVEBANK.COM http://www.americanperspectivebank.com/ Phone: (805) 547 - 2800 (San Luis Obispo) Facsimile: (805) 547 - 2801 (San Luis Obispo) Phone: (805) 354 - 7800 (Santa Maria) Facsimile: (805) 354 - 7801 (Santa Maria) --- financial data follows --- AMERICAN PERSPECTIVE BANK Consolidated Financial Highlights Unaudited (Dollars In Thousands) December September December 31, 30, 31, Financial Condition Data (1) 2010 2010 2009 ---------------------------- ---- ---- ---- Assets ---------------------------- Cash and due from banks $2,001 $2,661 $2,462 Interest bearing deposits in other financial institutions 382 2,825 2,421 Securities available for sale, at fair value: Mortgage backed securities 17,524 22,422 51,218 Collateralized mortgage obligations 35,047 32,174 4,819 Loans receivable held for investment: Home equity lines of credit 13,973 12,935 12,536 Multifamily real estate loans 11,067 11,119 7,966 Commercial and industrial real estate loans 80,941 66,133 55,231 Construction loans 11,640 9,082 9,440 Land / lot loans 5,420 5,444 8,681 Farm real estate loans -- -- 3,600 Commercial business loans 36,452 38,604 37,067 Other loans 7,431 6,740 5,402 ----- ----- ----- Gross loans held for investment, net of deferred fees and costs 166,924 150,057 139,923 Less: Allowance for loan losses (2,444) (2,167) (2,488) ------ ------ ------ Loans receivable held for investment, net 164,480 147,890 137,435 Investment in capital stock of the Federal Home Loan Bank, at cost 1,076 1,076 757 Premises and equipment, net 1,655 1,780 1,365 Accrued interest receivable 574 528 623 Other real estate owned 4,478 4,787 -- Other assets 1,667 1,755 1,868 ----- ----- ----- Total assets $228,884 $217,898 $202,968 ======== ======== ======== Liabilities and Stockholders' Equity ------------------------------------ Deposits: Non-interest bearing demand deposits $23,136 $18,969 $18,482 Interest bearing checking accounts 1,871 2,426 3,297 Savings accounts 733 472 77 Money market accounts 95,036 92,641 74,936 Certificates of deposit 55,221 57,255 55,460 ------ ------ ------ Total deposits 175,997 171,763 152,252 Borrowings 12,026 5,359 10,453 Other liabilities 950 1,038 1,109 --- ----- ----- Total liabilities 188,973 178,160 163,814 ------- ------- ------- Stockholders' equity 39,911 39,738 39,154 ------ ------ ------ Total liabilities and stockholders' equity $228,884 $217,898 $202,968 ======== ======== ======== (1) Certain reclassifications have been made to prior period financial statements to conform them to the current period presentation. AMERICAN PERSPECTIVE BANK Consolidated Financial Highlights, Continued Unaudited (Dollars In Thousands, Except Per Share Amounts) Three Three Months Months Ended Ended Operating Results Data (1) 12/31/2010 12/31/2009 -------------------------- ---------- ---------- Interest and dividend income $2,575 $2,326 Interest expense 518 533 --- --- Net interest income before provision for loan losses 2,057 1,793 Provision for loan losses 277 299 --- --- Net interest income after provision for loan losses 1,780 1,494 ----- ----- Non-interest income: Gain on sale of securities 153 47 Name change payments in excess of costs -- -- Other non-interest income 27 31 --- --- Total non-interest income 180 78 --- --- Other real estate owned expense: Loss on sale of other real estate owned -- -- Other real estate owned valuation adjustments 310 -- Other real estate owned operations expense (income) 28 -- --- --- Total other real estate owned expense 338 -- --- --- Non-interest expense: Compensation and employee benefits 735 601 Accounting, legal, and consulting 132 215 Occupancy 171 126 Regulatory assessments 84 77 Equipment 57 49 Data and item processing 64 52 Director expenses 1 39 Supplies, printing, courier, and postage 28 31 Advertising and promotion 45 22 Provision for (reduction of) allowance for off balance sheet commitments 9 3 Other expenses 131 115 --- --- Total non-interest expense 1,457 1,330 ----- ----- Income (loss) before provision for income taxes 165 242 Provision for income taxes -- 1 --- --- Net income (loss) $165 $241 ==== ==== Weighted average shares used in basic income (loss) per share calculation 4,331,687 4,273,389 Basic income (loss) per share $0.04 $0.06 ===== ===== Weighted average shares used in diluted income (loss) per share calculation 4,332,792 4,291,747 Diluted income (loss) per share $0.04 $0.06 ===== ===== Average total assets $223,863 $191,227 Annualized net interest income / average total assets 3.67% 3.75% Twelve Twelve Months Months Ended Ended Operating Results Data (1) 12/31/2010 12/31/2009 -------------------------- ---------- ---------- Interest and dividend income $9,686 $8,842 Interest expense 2,151 2,205 ----- ----- Net interest income before provision for loan losses 7,535 6,637 Provision for loan losses 1,258 3,458 ----- ----- Net interest income after provision for loan losses 6,277 3,179 ----- ----- Non-interest income: Gain on sale of securities 570 47 Name change payments in excess of costs 40 -- Other non-interest income 107 91 --- --- Total non-interest income 717 138 --- --- Other real estate owned expense: Loss on sale of other real estate owned 105 -- Other real estate owned valuation adjustments 598 -- Other real estate owned operations expense (income) (8) -- --- --- Total other real estate owned expense 695 -- --- --- Non-interest expense: Compensation and employee benefits 2,874 2,423 Accounting, legal, and consulting 651 656 Occupancy 645 505 Regulatory assessments 321 314 Equipment 219 190 Data and item processing 225 204 Director expenses 40 133 Supplies, printing, courier, and postage 118 100 Advertising and promotion 236 80 Provision for (reduction of) allowance for off balance sheet commitments (1) (2) Other expenses 491 421 --- --- Total non-interest expense 5,819 5,024 ----- ----- Income (loss) before provision for income taxes 480 (1,707) Provision for income taxes 2 1 --- --- Net income (loss) $478 $(1,708) ==== ======= Weighted average shares used in basic income (loss) per share calculation 4,304,839 4,256,987 Basic income (loss) per share $0.11 $(0.40) ===== ====== Weighted average shares used in diluted income (loss) per share calculation 4,309,917 4,256,987 Diluted income (loss) per share $0.11 $(0.40) ===== ====== Average total assets $212,415 $177,843 Annualized net interest income / average total assets 3.55% 3.73% (1) Certain reclassifications have been made to prior period financial statements to conform them to the current period presentation. AMERICAN PERSPECTIVE BANK Consolidated Financial Highlights, Continued Unaudited December 31, September 30, December 31, Other Information 2010 2010 2009 ----------------- ------------- -------------- ------------- Net loans / deposits 93.46% 86.10% 90.27% Allowance for loan losses / loans outstanding 1.46% 1.44% 1.78% Nominal and tangible book value per share $9.20 $9.22 $9.15 Shares of common stock outstanding 4,339,286 4,310,613 4,277,713
American Perspective Bank
CONTACT: Thomas J. Beene, President, Chief Executive Officer,
+1-805-547-2831, Tom.Beene@AmericanPerspectiveBank.com, or Mark R. Andino,
Chief Financial Officer, Chief Operating Officer, +1-805-547-2832,
Mark.Andino@AmericanPerspectiveBank.com, both of American Perspective Bank; or
General communication, San Luis Obispo, +1-805-547-2800, fax, +1-805-547-2801,
or Santa Maria, +1-805-354-7800, fax, +1-805-354-7801,
SERVICE@AMERICANPERSPECTIVEBANK.COM
Web Site: http://www.americanperspectivebank.com/
