News Column

1st Capital Bank Reports Continued Profitable Growth for the 3rd Quarter of 2012

Page 2 of 1

LogoTracker

MONTEREY, CA -- (Marketwire) -- 10/18/12 -- 1st Capital Bank (OTCBB: FISB): 1st Capital Bank continued to build core relationships as it closed the third quarter of 2012 with an increase in net income of 73% over the same quarter a year ago and $303 million in total assets, representing 28% growth over the same quarter a year ago. "1st Capital's growth in earning assets continues to significantly outperform the national average for the industry," stated CEO and President Fred Rowden.

Key Performance Highlights of the Third Quarter 2012:

•Net income increased 73% compared to the same quarter a year ago, resulting in an ROA of 0.7% for the quarter •Total assets increased $67 million or 28% to $303 million as of September 30, 2012 compared to September 30, 2011 •Total deposits grew $65 million, or 32%, to $269 million compared to the third quarter of 2011 •Loans outstanding grew $33 million, or 17%, to a total of $234 million compared to the third quarter of 2011 •Asset quality continued to be strong, with a ratio of nonperforming loans to total loans of just 0.31% at September 30, 2012 •Regulatory "Well Capitalized" levels were maintained, with a total risk based capital ratio of 15.3% at September 30, 2012

As a result of the Bank's strong loan growth and reductions in the cost of interest bearing liabilities, net interest income increased by $516,000 as compared to the same quarter in the prior year. This was slightly offset by an increase in non-interest expenses of $154,000, resulting from investments in staff and facilities, since the same quarter in the prior year. Net income of $539,000 for the quarter was up 73% compared to $312,000 in the third quarter of 2011. Profits generated over the last twelve months have increased book value from $9.79 at September 30, 2011 to $10.26 as of September 30, 2012. The efficiency ratio (operating costs compared to income from operations) improved to 0.67 for the quarter ended September 30, 2012 compared to 0.75 for the same quarter one year ago.

"Despite the economic pressures the state and nation have faced, Monterey County has remained a resilient market with a strong economic base including the diversified business sectors of agriculture, hospitality, tourism, medical and education. 1st Capital Bank's role in this diversified economy has contributed to the positive results of operations of the Bank through the quarter ended September 30, 2012," said Fred Rowden, CEO and President.

During the third quarter of 2012, the Bank continued to leverage its investment in staff and infrastructure as it built new relationships that contributed to positive growth. These relationships have increased the percentage of core checking and savings accounts to 87% of total deposits compared to 78% one year ago. In addition, the overall cost of deposits has dropped from 0.50% to 0.31% during the same time period. As the Bank continues to grow it is also leveraging its capital, as evidenced by current Total Risk Based Capital of 15.3% compared to 17.1% one year ago.

The Bank's Financial Summary for the quarter ended September 30, 2012 is described below. For more information regarding the Bank's growth and performance, please visit our website at www.1stcapitalbank.com, or call 831.264.4000.

Financial Summary

Net Income - Income before taxes was $929,000 for the quarter ended September 30, 2012 compared to $547,000 for the same quarter in the prior year. This increase was largely due to an increase in interest income and a decrease in interest expense, partially offset by an increase in non-interest expense. Net income of $539,000 for the quarter ended September 30, 2012 increased $227,000 compared to net income of $312,000 for the same quarter in the prior year, and increased $330,000 over the net income for the trailing quarter ended June 30, 2012.

Basic and fully diluted earnings per share of $0.17 and $0.16, respectively, for the three months ended September 30, 2012 continued to add to retained earnings. These per share earnings increased from $0.10, basic and fully diluted for the same quarter a year ago and $0.06 basic and fully diluted for the prior quarter.

Balance Sheet - Total assets of $303 million as of September 30, 2012 increased $67 million (28%) from September 30, 2011 and decreased $1 million (0%) from June 30, 2012. Loans grew $33 million (17%) from September 30, 2011 to a total of $234 million as of September 30, 2012, with $6 million (3%) of that growth occurring in the three-month period ended September 30, 2012. Loan growth was funded largely by increased deposits, which grew $65 million (32%) from September 30, 2011 to a total of $269 million as of September 30, 2012, and decreased by $2 million (1%) from the balances outstanding as of June 30, 2012. As of September 30, 2012, the ratio of loans to deposits increased to 87% compared to 84% as of June 30, 2012 and 99% as of September 30, 2011.

Interest Income and Expense - Net interest income for the quarter ended September 30, 2012 was $3,089,000, an increase of $516,000 (20%) over the quarter ended September 30, 2011 and an increase of $191,000 (7%) over the trailing quarter ended June 30, 2012.

Interest income for the quarter ended September 30, 2012 was $3,298,000, an increase of $473,000 (17%) over the quarter ended September 30, 2011 and an increase of $176,000 (6%) over the trailing quarter ended June 30, 2012. Average earning assets for the quarter ended September 30, 2012 were $292 million, an increase of $67 million (30%) and $5 million (2%) compared to the quarters ended September 30, 2011, and June 30, 2012, respectively.

Interest expense for the quarter ended September 30, 2012 was $209,000, a reduction of $43,000 (17%) from the quarter ended September 30, 2011 and a decrease of $15,000 (7%) from the trailing quarter ended June 30, 2012. Average interest bearing liabilities for the quarter ended September 30, 2012 were $167 million, an increase of $30 million (22%) compared to the quarter ended September 30, 2011 and unchanged from June 30, 2012. While the average balances of interest-bearing deposit liabilities for the quarter ended September 30, 2012 increased compared to September 30, 2011, interest expense decreased due to the repricing of interest-bearing deposits, reflecting the Bank's continued focus on improving its net interest margin. Average noninterest bearing deposits of $103 million for the quarter ended September 30, 2012 grew $38 million (58%) and $6 million (6%) compared to the quarters ended September 30, 2011 and June 30, 2012, respectively.

These changes in the composition and pricing of 1st Capital Bank's earning assets and deposit liabilities resulted in a net interest margin for the quarter ended September 30, 2012 of 4.2% compared to 4.5% for the quarter ended September 30, 2011 and 4.1% for the quarter ended June 30, 2012. The decrease in net interest margin from a year ago was primarily the result of strong growth in the deposit portfolio during that time which resulted in an increase in liquidity that temporarily reduced the yield on earning assets and to the prolonged low interest rate environment which resulted in a decline in the loan portfolio yield. During the quarter ended September 30, 2012, the yield on the loan portfolio decreased to 5.4% compared to 5.7% for the quarter ended September 30, 2011 and 5.6% for the quarter ended June 30, 2012. Further, the Bank continued to reduce the overall cost of deposits to just 0.3% for the period ended September 30, 2012 from 0.5% and 0.3%, respectively, for the three month periods ended September 30, 2011 June 30, 2012.

Provision for Loan Losses - 1st Capital Bank recorded a provision for loan losses of $98,000 during the quarter ended September 30, 2012 compared to $102,000 in the quarter ended September 30, 2011 and $424,000 in the trailing quarter ended June 30, 2012. The provision continues to be impacted by the volume and variety of loan growth in addition to management's assessment of the condition of the loan portfolio. The ratio of the allowance for loan losses to total loans outstanding was 1.66% at September 30, 2012 compared to 1.56% and 1.66% at September 30, 2011 and June 30, 2012, respectively. The Bank's asset quality remained strong, with a ratio of impaired and nonperforming loans to total loans of only 0.31% as of September 30, 2012. The Bank has never had any real estate acquired through foreclosure.

Noninterest Income - Noninterest income increased $16,000 (50%) to $48,000 for the quarter ended September 30, 2012 compared to the quarter ended September 30, 2011 and increased $11,000 (30%) compared to the trailing quarter ended June 30, 2012, largely due to changes in the volume of fees for services.

Noninterest Expense - Noninterest expense increased $154,000 (8%) to $2.1 million for the quarter ended September 30, 2012 compared to the quarter ended September 30, 2011 and decreased $40,000 (2%) compared to the trailing quarter ended June 30, 2012. The majority of the increase over the prior year was due to the overall growth of the Bank and the investment by the Bank in key personnel and enhanced facilities.

About 1st Capital Bank

1st Capital Bank is focused on providing lending, deposit and highly efficient cash management services such as remote deposit and online banking to small-to-medium size businesses and their owners, and offers specialized banking services for the healthcare industry. The Bank is a full service financial institution with branches located in Monterey, Salinas and King City. The Bank's corporate offices are located at 5 Harris Court, Building N, Suite 3, Monterey, California 93940. Please visit our website at www.1stcapitalbank.com for more information. Member FDIC. Equal Opportunity Lender. An SBA Preferred Lender.


1ST CAPITAL BANK CONDENSED FINANCIAL DATA (Unaudited) (Dollars in thousands, except share and per share data) 3 Months Ended Percent Change From: -------------------------------- September September SeptemberStatement of 30, June 30, 30, June 30, 30,Income Data 2012 2012 2011 2012 2011 ---------- ---------- ---------- --------- ---------Interest income Loans (including fees) $ 3,153 $ 2,966 $ 2,709 6% 16% Investment securities 103 106 94 (3%) 10% Other 42 50 22 (16%) 91% ---------- ---------- ---------- Total interest income 3,298 3,122 2,825 6% 17% ---------- ---------- ----------Interest expense Interest on deposits 209 224 252 (7%) (17%) Other - - - ---------- ---------- ---------- Total interest expense 209 224 252 (7%) (17%) ---------- ---------- ----------Net interest income 3,089 2,898 2,573 7% 20%Provision for loan losses 98 424 102 (77%) (4%) ---------- ---------- ----------Net interest income after provision for loan losses 2,991 2,474 2,471 21% 21%Noninterest income Service charges on deposits 20 21 19 (5%) 5% Other 28 16 13 75% 15% ---------- ---------- ---------- Total noninterest income 48 37 32 30% 50%Noninterest expenses Salaries and benefits 1,290 1,243 1,107 4% 17% Occupancy 173 180 150 (4%) 15% Furniture and equipment 65 82 110 (21%) (41%) Other 582 645 589 (10%) (1%) ---------- ---------- ---------- Total noninterest expenses 2,110 2,150 1,956 (2%) 8% ---------- ---------- ----------Income before provision for income taxes 929 361 547 157% 70%Provision for (benefit from) income taxes 390 152 235 157% 66% ---------- ---------- ---------- Net income $ 539 $ 209 $ 312 158% 73% ========== ========== ==========Common Share DataEarnings per share Basic $ 0.17 $ 0.06 $ 0.10 183% 70% Diluted $ 0.16 $ 0.06 $ 0.10 167% 60%Weighted average shares outstanding Basic 3,248,690 3,223,836 3,220,853 1% 1% Diluted 3,337,605 3,317,799 3,254,306 (1%) 3%Book value per shareTangible book value 1ST CAPITAL BANK CONDENSED FINANCIAL DATA (Unaudited) (Dollars in thousands, except share and per share data) 9 Months Ended --------------------------------Statement of September 30, PercentIncome Data 2012 2011 Change ---------- ---------- ---------Interest income Loans (including fees) $ 8,898 $ 7,835 14% Investment securities 312 307 2% Other 134 65 106% ---------- ---------- Total interest income 9,344 8,207 14% ---------- ----------Interest expense Interest on deposits 641 778 (18%) Other - - ---------- ---------- Total interest expense 641 778 (18%) ---------- ----------Net interest income 8,703 7,429 17%Provision for loan losses 562 469 20% ---------- ----------Net interest income after provision for loan losses 8,141 6,960 17%Noninterest income Service charges on deposits 63 48 31% Other 60 54 11% ---------- ---------- Total noninterest income 123 102 21%Noninterest expenses Salaries and benefits 3,835 3,029 27% Occupancy 530 437 21% Furniture and equipment 242 271 (11%) Other 1,830 1,522 20% ---------- ---------- Total noninterest expenses 6,437 5,259 22% ---------- ----------Income before provision for income taxes 1,827 1,803 1%Provision for (benefit from) income taxes 769 (1,078) (171%) ---------- ---------- Net income $ 1,058 $ 2,881 (63%) ========== ==========Common Share DataEarnings per share Basic $ 0.33 $ 0.89 (63%) Diluted $ 0.32 $ 0.89 (64%)Weighted average shares outstanding Basic 3,238,440 3,220,853 1% Diluted 3,343,070 3,233,435 3%Book value per share $ 10.26 $ 9.79 5%Tangible book value $ 10.26 $ 9.79 5% 1ST CAPITAL BANK CONDENSED FINANCIAL DATA (Unaudited) (Dollars in thousands) Percent Change From: December September September December September 31, 30,Balance Sheet Data 2012 2011 2011 2011 2011 --------- --------- --------- --------- ---------Assets Cash and due from banks $ 7,444 $ 8,910 $ 8,964 (16%) (17%) Federal funds sold and overnight deposits 27,430 60,062 9,878 (54%) 178% Available-for- sale securities, at fair value, and interest bearing deposits 26,954 17,520 14,812 54% 82% Loans: Commercial 89,117 78,504 83,873 14% 6% Real estate- construction 4,513 4,126 3,731 9% 21% Real estate- other 138,641 115,902 110,783 20% 25% Consumer 1,295 1,580 1,754 (18%) (26%) Deferred loan costs, net 516 470 455 10% 13% --------- --------- --------- Total loans 234,082 200,582 200,596 17% 17% Allowance for loan losses (3,882) (3,320) (3,124) 17% 24% --------- --------- --------- Net loans 230,200 197,262 197,472 17% 17% Premises and equipment, net 1,325 615 567 115% 134% Accrued interest receivable and other assets 9,331 3,946 4,039 114% 109% --------- --------- ---------Total assets $ 302,684 $ 288,315 $ 235,732 5% 28% ========= ========= =========Liabilities and Shareholders' Equity Deposits: Demand, noninterest bearing $ 102,745 $ 118,366 $ 69,047 (13%) 49% Demand, interest bearing 72,950 56,171 54,178 30% 35% Savings 58,260 38,558 35,551 51% 64% Time 34,584 42,488 44,630 (19%) (23%) --------- --------- --------- Total deposits 268,539 255,583 203,406 5% 32% Accrued interest payable and other liabilities 910 919 803 (98%) (98%) Shareholders' equity 33,235 31,813 31,523 4% 5% --------- --------- ---------Total liabilities and shareholders' equity $ 302,684 $ 288,315 $ 235,732 5% 28% ========= ========= =========Asset Quality Loans past due 90 days or more and accruing interest $ - $ - $ - Restructured loans 220 240 250 (8%) (12%) Other nonaccrual loans 520 - - Other real estate owned - - - --------- --------- --------- Total nonperforming assets $ 740 $ 240 $ 250 208% 196% ========= ========= ========= Allowance for loan losses to total loans 1.66% 1.66% 1.56% 0% 6% Allowance for loan losses to NPL's 525% 1,383% 1,250% (62%) (58%) Allowance for loan losses to NPA's 525% 1,383% 1,250% (62%) (58%)Regulatory Capital and Ratios Tier 1 capital $ 32,793 $ 31,490 $ 31,116 4% 5% Total capital $ 35,723 $ 33,985 $ 33,654 5% 6% Tier 1 capital ratio 14.1% 15.8% 15.7% (11%) (10%) Total risk based capital ratio 15.3% 17.1% 17.0% (10%) (10%) Tier 1 leverage ratio 10.8% 12.6% 13.3% (14%) (19%)




1ST CAPITAL BANK CONDENSED FINANCIAL DATA (Unaudited) (Dollars in thousands) 3 Months Ended Percent Change From: September September SeptemberSelected 30, June 30, 30, June 30, 30,Financial Ratios 2012 2012 2011 2012 2011 --------- --------- --------- -------- ---------Return on average total assets 0.71% 0.28% 0.53% 150% 34%Return on average shareholders' equity 6.49% 2.59% 3.94% 151% 65%Net interest margin 4.2% 4.1% 4.5% 4% (7%)Efficiency ratio 67.26% 73.25% 75.09% (8%) (10%)Selected Average BalancesLoans $ 231,716 $ 214,583 $ 190,066 8% 22%Investment securities 17,866 17,790 12,852 0% 39%Federal funds sold and CD's 42,873 55,218 21,945 (22%) 95% --------- --------- --------- Total earning assets $ 292,455 $ 287,591 $ 224,863 2% 30% --------- --------- --------- Total assets $ 303,785 $ 297,159 $ 234,374 2% 30% --------- --------- ---------Demand deposits - interest bearing $ 77,366 $ 81,168 $ 57,815 (5%) 34%Savings 55,170 48,242 33,291 14% 66%Time deposits 35,229 37,704 45,991 (7%) (23%) --------- --------- --------- Total interest bearing liabilities $ 167,765 $ 167,114 $ 137,096 0% 22% --------- --------- ---------Demand deposits - noninterest bearing 102,719 96,972 64,784 6% 59% --------- --------- ---------Total Deposits $ 270,484 $ 264,086 $ 201,880 2% 34% --------- --------- ---------Shareholders' equity $ 33,031 $ 32,513 $ 31,449 2% 5% --------- --------- --------- 1ST CAPITAL BANK CONDENSED FINANCIAL DATA (Unaudited) (Dollars in thousands) 9 Months EndedSelected September 30, PercentFinancial Ratios 2012 2011 Change --------- --------- -------Return on average total assets 0.48% 1.70% 72%Return on average shareholders' equity 4.33% 12.86% 66%Net interest margin 4.1% 4.5% (9%)Efficiency ratio 72.93% 69.83% 4%Selected Average BalancesLoans $ 215,472 $ 185,318 16%Investment securities 17,132 13,521 27%Federal funds sold and CD's 50,537 20,090 152% --------- --------- Total earning assets $ 283,142 $ 218,929 29% --------- --------- Total assets $ 293,736 $ 226,729 30% --------- ---------Demand deposits - interest bearing $ 76,095 $ 59,127 29%Savings 48,348 31,564 53%Time deposits 37,985 47,559 (20%) --------- --------- Total interest bearing liabilities $ 162,427 $ 138,250 17% --------- ---------Demand deposits - noninterest bearing 98,353 57,551 71% --------- ---------Total Deposits $ 260,780 $ 195,801 33% --------- ---------Shareholders' equity $ 32,564 $ 29,963 9% --------- ---------





Contact Information
Jayme Fields
CFO
(831) 264-4011



Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters