DENVER, CO -- (Marketwire) -- 01/28/13 -- Guaranty Bancorp (NASDAQ: GBNK)
•Loan growth of $60.6 million, or 5.5% during 2012 •Increase in pre-tax net income of $5.5 million, or 87.2%, as compared to 2011 •Reduction in classified assets of $24.7 million, or 29.6%, during 2012, further reduced by an additional $10.9 million due to the sale of our largest classified asset in January 2013 •Previously announced redemption of $15.0 million of our trust preferred securities scheduled for first quarter 2013 will reduce interest expense by $1.6 million annually
Guaranty Bancorp (NASDAQ: GBNK), a Colorado-based community bank holding company, today reported fourth quarter 2012 net income of $3.1 million, or $0.03 earnings per basic and diluted common share, compared to net income of $2.3 million, or $0.02 earnings per basic and diluted common share in the fourth quarter 2011.
"We could not be more pleased with our performance in 2012," said Paul W. Taylor, President and CEO. "We successfully executed on our business plans to grow loans, increase deposits, and improve our credit quality. Our 2012 loan growth was $60.6 million, or 5.5%, despite a $71.5 million reduction in our purchased loan participations. We also grew our core deposits by $153.6 million, or 13.8% during 2012, further enhancing our high liquidity level. Continued focus on improving our credit quality metrics resulted in a substantial reduction in our classified asset ratio to 25.2% at the end of 2012 as compared to 36.6% at the end of the previous year. On a proforma basis, our classified asset ratio at December 31, 2012 improved to 20.5% after consideration of the sale of our largest classified asset on January 28, 2013."
Taylor continued, "Private Capital Management, the Colorado based investment management firm we acquired in July of 2012, also delivered outstanding results in just five short months. Assets under management grew by $14.5 million, or 8.7%, since the close of the acquisition. Additionally, the firm contributed $0.5 million to noninterest income in 2012. These accomplishments, in addition to a continued focus on enhancing profitability, make Guaranty Bancorp well positioned for further growth in 2013."
The $0.8 million improvement in net income in the fourth quarter 2012 compared to the same quarter in 2011 was primarily due to a $2.3 million increase in pre-tax income, offset by a $1.5 million increase in tax expense. The improvement in pre-tax income was primarily due to a $4.5 million decrease in provision for loan loss, due to improvements in credit quality and reduced charge-off levels, and an increase in noninterest income of $1.0 million, primarily due to increases in customer service fees and gains on sale of securities. These improvements were partially offset by a $3.1 million increase in noninterest expense, primarily driven by a $3.0 million write-down on the Company's single largest other real estate owned ("OREO") property, which was subsequently sold in January 2013.
Earnings per basic and diluted common share improved to $0.14 for the year ended December 31, 2012 as compared to a loss per basic and diluted common share of $0.21 from the prior year. The prior year loss per common share calculation included a non-cash adjustment of approximately $19.8 million, or $0.30 per basic and diluted common share, related to three quarters of paid-in-kind preferred stock dividends and the mandatory accelerated conversion of the Company's Series A Convertible Preferred Stock into common stock in September 2011.
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