JOHNSTOWN, Pa., April 15, 2014 /PRNewswire/ -- AmeriServ
Financial, Inc. (NASDAQ: ASRV) reported first quarter 2014 net
income available to common shareholders of $877,000, or $0.05
per diluted common share. Net income available to common
shareholders in the first quarter of 2014 declined by $127,000, or 12.6%, from the prior year first
quarter due primarily to reduced non-interest revenue and no
earnings benefit from a negative loan loss provision as was the
case in 2013. Diluted earnings per share was consistent
between periods as total shares outstanding were lower in 2014 due
to the success of the Company's common stock repurchase program
which was completed in the second quarter of 2013. The
following table highlights the Company's financial performance for
the quarters ended March 31, 2014 and
2013:
|
First Quarter
2014
|
First Quarter
2013
|
|
|
|
Net income
|
$930,000
|
$1,056,000
|
Net income available
to common shareholders
|
$877,000
|
$1,004,000
|
Diluted earnings per
share
|
$ 0.05
|
$ 0.05
|
Glenn L. Wilson, President and
Chief Executive Officer, commented on the first quarter 2014
financial results: "There were several bright spots within our
first quarter financial performance despite the overall negative
impact that the record cold winter had on business activity within
our marketplace. We have grown our loan portfolio by
$72 million, or 10.0%, over the past
12 months which was a key factor responsible for the 6.0% increase
in net interest income in the first quarter of 2014. While
total non-interest revenue did decline in the first quarter of 2014
due to a sharp decrease in residential mortgage banking revenue,
our trust and wealth management business continued to show good
growth with fees up 8.0% when compared to last year. Finally,
we maintained excellent asset quality as our non-performing assets
were only 0.41% of total loans, and there were no net loan
charge-offs in the first quarter of 2014."
The Company's net interest income in the first quarter of 2014
increased by $483,000, or 6.0%, when
compared to the first quarter of 2013. The Company's net
interest margin of 3.56% for the first quarter of 2014 was three
basis points lower than the net interest margin of 3.59% for the
first quarter 2013 and only one basis point lower than the more
recently reported fourth quarter 2013 performance. We believe
that this demonstrates that the recent pace of net interest margin
contraction has slowed from the pace of margin decline experienced
over the previous two years. The Company has been able to
mitigate this net interest margin pressure and to increase net
interest income by both growing its earning assets and reducing its
cost of funds. Specifically, the earning asset growth has occurred
in the loan portfolio as total loans averaged $787 million in the first quarter of 2014 which
is $60 million or 8.2% higher than
the $728 million average for the
first quarter of 2013. This loan growth reflects the
successful results of the Company's more intensive sales calling
efforts, with an emphasis on generating commercial loans and owner
occupied commercial real estate loans, which qualify as Small
Business Lending Fund (SBLF) loans, particularly through its loan
production offices. As a result of this growth in SBLF
qualified loans, the Company has locked in the lowest preferred
dividend rate available under the program of 1% until the first
quarter of 2016. Interest income in 2014 has also benefitted
from reduced premium amortization on mortgage backed securities due
to slower mortgage prepayment speeds. Total interest expense
for the first quarter of 2014 declined by $90,000 from the 2013 first quarter due to the
Company's proactive efforts to reduce deposit costs. Even
with this reduction in deposit costs, the Company still experienced
growth in deposits which reflects the loyalty of our core deposit
base and ongoing efforts to cross sell new loan customers into
deposit products. Specifically, total deposits reached a
record level and averaged $856
million for the first quarter of 2014 which is $20 million, or 2.4%, higher than the
$836 million average in the first
quarter of 2013. The Company continues to maintain good
liquidity as evidenced by a loan to deposit ratio of 90.2% at
March 31, 2014.
The Company did not record a provision for loan losses in the
first quarter of 2014 as compared to a $250,000 negative provision recorded in the first
quarter of 2013. The Company continued to maintain
outstanding asset quality in the first quarter of 2014. At
March 31, 2014, non-performing assets
are at their lowest point since the financial crisis and totaled
$3.3 million, or 0.41%, of total
loans which is $835,000 lower than
they were at the end of 2013. There were no net loan charge-offs in
the first quarter of 2014 as compared to net charge-offs of
$1.4 million, or 0.76%, of total
loans in the same prior year quarter when the Company resolved its
largest non-performing credit of 2013. When determining the
provision for loan losses, the Company considers a number of
factors, some of which include periodic credit reviews,
non-performing assets, loan delinquency and charge-off trends,
concentrations of credit, loan volume trends and broader local and
national economic trends. In summary, the allowance for loan
losses provided a strong 448% coverage of non-performing loans, and
was 1.28% of total loans, at March 31,
2014, compared to 327% of non-performing loans, and 1.29% of
total loans, at December 31,
2013.
Total non-interest income in the first quarter of 2014 decreased
by $284,000, or 7.4%, from the first
quarter of 2013 due primarily to reduced revenue from residential
mortgage banking activities. This 2014 reduction was caused by both
lower refinance activity due to higher mortgage rates and reduced
purchase activity due to the harsh winter weather conditions.
As a result, gains realized on residential mortgage loan sales into
the secondary market declined by $285,000 and other income dropped by $89,000 due largely to lower mortgage related
origination and underwriting fees. These negative items were
partially offset by increased fees from our trust and wealth
management businesses. Specifically, trust and investment
advisory fees increased by $151,000,
or 8.0%, for first quarter of 2014 due to increased assets under
management which reflects both successful new business development
activities and market appreciation of existing assets when compared
to the first quarter of 2013.
The Company's total non-interest expense in the first quarter of
2014 increased by $116,000, or 1.1%,
when compared to the first quarter of 2013. Salaries and
employee benefits were down modestly between periods as the benefit
of lower incentive compensation expense was largely offset by
increased health insurance premiums. Professional fees
increased by $273,000 in the first
quarter of 2014 due to higher legal costs, recruitment fees, and
new recurring costs related to outsourcing our computer operations
and statement processing to a third party vendor. The overall
cost savings benefit from outsourcing these services is captured in
lower personnel costs in these departments and reduced software
expense which is a key factor contributing to the $247,000 decline in other expenses in the first
quarter of 2014. Occupancy expense increased by $66,000 as a result of higher utilities and snow
removal costs in the first quarter of 2014 due to the harsh winter
weather conditions. Finally, the Company recorded an income
tax expense of $389,000, or an
effective tax rate of 29.5%, in the first quarter of 2014 which is
comparable with the income tax expense of $430,000, or an effective tax rate of 28.9%, for
the first quarter of 2013.
The Company had total assets of $1.05
billion, shareholders' equity of $115
million, a book value of $4.97
per common share and a tangible book value of $4.31 per common share at March 31, 2014. The Company has increased
its tangible book value per share by 6.2% over the past twelve
months. The Company continued to maintain strong capital
ratios that exceed the regulatory defined well capitalized status
with a risk based capital ratio of 15.34%, an asset leverage ratio
of 11.50% and a tangible common equity to tangible assets ratio of
7.80% at March 31, 2014.
This news release may contain forward-looking statements that
involve risks and uncertainties, as defined in the Private
Securities Litigation Reform Act of 1995, including the risks
detailed in the Company's Annual Report and Form 10-K to the
Securities and Exchange Commission. Actual results may differ
materially.
NASDAQ:
ASRV
|
SUPPLEMENTAL
FINANCIAL PERFORMANCE DATA
|
March 31,
2014
|
(Dollars in
thousands, except per share and ratio data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
1QTR
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE DATA FOR
THE PERIOD:
|
|
|
|
|
|
|
Net
income
|
|
930
|
|
|
|
|
Net income available
to common shareholders
|
|
877
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE
PERCENTAGES (annualized):
|
|
|
|
|
|
|
Return on average
assets
|
|
0.36%
|
|
|
|
|
Return on average
equity
|
|
3.30
|
|
|
|
|
Net interest
margin
|
|
3.56
|
|
|
|
|
Net charge-offs
(recoveries) as a percentage of average loans
|
-
|
|
|
|
|
Loan loss provision
(credit) as a percentage of average loans
|
-
|
|
|
|
|
Efficiency
ratio
|
|
89.02
|
|
|
|
|
|
|
|
|
|
|
|
PER COMMON
SHARE:
|
|
|
|
|
|
|
Net
income:
|
|
|
|
|
|
|
Basic
|
|
0.05
|
|
|
|
|
Average number of
common shares outstanding
|
|
18,786
|
|
|
|
|
Diluted
|
|
0.05
|
|
|
|
|
Average number of
common shares outstanding
|
|
18,904
|
|
|
|
|
Cash dividends
declared
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
|
|
|
|
|
|
|
TO DATE
|
PERFORMANCE DATA FOR
THE PERIOD:
|
|
|
|
|
|
|
Net
income
|
|
1,056
|
1,070
|
1,226
|
1,841
|
5,193
|
Net income available
to common shareholders
|
|
1,004
|
1,018
|
1,173
|
1,789
|
4,984
|
|
|
|
|
|
|
|
PERFORMANCE
PERCENTAGES (annualized):
|
|
|
|
|
|
|
Return on average
assets
|
|
0.43%
|
0.43%
|
0.47%
|
0.70%
|
0.51%
|
Return on average
equity
|
|
3.86
|
3.86
|
4.44
|
6.57
|
4.69
|
Net interest
margin
|
|
3.59
|
3.50
|
3.46
|
3.57
|
3.56
|
Net charge-offs
(recoveries) as a percentage of average loans
|
0.76
|
(0.02)
|
(0.02)
|
0.04
|
0.18
|
Loan loss provision
(credit) as a percentage of average loans
|
(0.14)
|
0.08
|
-
|
(0.51)
|
(0.15)
|
Efficiency
ratio
|
|
89.52
|
86.28
|
85.41
|
86.17
|
86.83
|
|
|
|
|
|
|
|
PER COMMON
SHARE:
|
|
|
|
|
|
|
Net
income:
|
|
|
|
|
|
|
Basic
|
|
0.05
|
0.05
|
0.06
|
0.10
|
0.26
|
Average number of
common shares outstanding
|
|
19,168
|
19,039
|
18,784
|
18,784
|
18,942
|
Diluted
|
|
0.05
|
0.05
|
0.06
|
0.09
|
0.26
|
Average number of
common shares outstanding
|
|
19,257
|
19,128
|
18,878
|
18,879
|
19,034
|
Cash dividends
declared
|
|
-
|
0.01
|
0.01
|
0.01
|
0.03
|
|
|
AMERISERV FINANCIAL,
INC.
|
(Dollars in
thousands, except per share, statistical, and ratio
data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
1QTR
|
|
|
|
FINANCIAL CONDITION
DATA AT PERIOD END:
|
|
|
|
|
Assets
|
|
1,051,108
|
|
|
|
Short-term
investments/overnight funds
|
|
9,019
|
|
|
|
Investment
securities
|
|
154,754
|
|
|
|
Loans and loans held
for sale
|
|
789,620
|
|
|
|
Allowance for loan
losses
|
|
10,109
|
|
|
|
Goodwill
|
|
12,613
|
|
|
|
Deposits
|
|
875,333
|
|
|
|
FHLB
borrowings
|
|
40,483
|
|
|
|
Shareholders'
equity
|
|
114,590
|
|
|
|
Non-performing
assets
|
|
3,274
|
|
|
|
Asset leverage
ratio
|
|
11.50%
|
|
|
|
Tangible common
equity ratio
|
|
7.80
|
|
|
|
PER COMMON
SHARE:
|
|
|
|
|
|
Book value
(A)
|
|
4.97
|
|
|
|
Tangible book value
(A)
|
|
4.31
|
|
|
|
Market
value
|
|
3.85
|
|
|
|
Trust assets - fair
market value (B)
|
|
1,692,663
|
|
|
|
|
|
|
|
|
|
STATISTICAL DATA AT
PERIOD END:
|
|
|
|
|
|
Full-time equivalent
employees
|
|
347
|
|
|
|
Branch
locations
|
|
18
|
|
|
|
Common shares
outstanding
|
|
18,793,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
FINANCIAL CONDITION
DATA AT PERIOD END:
|
|
|
|
|
Assets
|
|
999,718
|
1,025,084
|
1,038,144
|
1,056,036
|
Short-term
investments/overnight funds
|
|
23,995
|
9,291
|
8,646
|
9,778
|
Investment
securities
|
|
162,866
|
168,284
|
167,110
|
160,165
|
Loans and loans held
for sale
|
|
717,852
|
751,522
|
763,681
|
786,748
|
Allowance for loan
losses
|
|
10,960
|
11,145
|
11,183
|
10,104
|
Goodwill
|
|
12,613
|
12,613
|
12,613
|
12,613
|
Deposits
|
|
847,189
|
840,272
|
852,211
|
854,522
|
FHLB
borrowings
|
|
16,000
|
50,292
|
52,096
|
66,555
|
Shareholders'
equity
|
|
111,445
|
109,282
|
110,370
|
113,307
|
Non-performing
assets
|
|
4,387
|
5,027
|
5,037
|
4,109
|
Asset leverage
ratio
|
|
11.58%
|
11.52%
|
11.44%
|
11.45%
|
Tangible common
equity ratio
|
|
7.88
|
7.47
|
7.48
|
7.64
|
PER COMMON
SHARE:
|
|
|
|
|
|
Book value
(A)
|
|
4.72
|
4.70
|
4.76
|
4.91
|
Tangible book value
(A)
|
|
4.06
|
4.03
|
4.09
|
4.24
|
Market
value
|
|
3.13
|
2.74
|
3.15
|
3.03
|
Trust assets - fair
market value (B)
|
|
1,566,236
|
1,562,366
|
1,599,402
|
1,668,654
|
|
|
|
|
|
|
STATISTICAL DATA AT
PERIOD END:
|
|
|
|
|
|
Full-time equivalent
employees
|
|
357
|
360
|
358
|
352
|
Branch
locations
|
|
18
|
18
|
18
|
18
|
Common shares
outstanding
|
|
19,168,188
|
18,784,188
|
18,784,188
|
18,784,188
|
|
Note:
|
(A) Preferred
stock of $21 million received through the Small Business Lending
Fund is excluded from the book value per common share
and tangible book value per common share
calculations.
|
(B) Not
recognized on the consolidated balance
sheets.
|
|
|
AMERISERV FINANCIAL,
INC.
|
CONSOLIDATED
STATEMENT OF INCOME
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
|
1QTR
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
9,032
|
|
|
|
|
Interest on
investments
|
|
1,063
|
|
|
|
|
Total Interest
Income
|
|
10,095
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
Deposits
|
|
1,211
|
|
|
|
|
All
borrowings
|
|
359
|
|
|
|
|
Total Interest
Expense
|
|
1,570
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST
INCOME
|
|
8,525
|
|
|
|
|
Provision (credit)
for loan losses
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST INCOME
AFTER PROVISION (CREDIT)
|
|
|
|
|
|
FOR LOAN
LOSSES
|
|
8,525
|
|
|
|
|
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
|
Trust fees
|
|
1,863
|
|
|
|
|
Investment advisory
fees
|
|
169
|
|
|
|
|
Net realized gains on
investment securities
|
|
57
|
|
|
|
|
Net realized gains on
loans held for sale
|
|
101
|
|
|
|
|
Service charges on
deposit accounts
|
|
478
|
|
|
|
|
Bank owned life
insurance
|
|
187
|
|
|
|
|
Other
income
|
|
677
|
|
|
|
|
Total Non-Interest
Income
|
|
3,532
|
|
|
|
|
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
6,314
|
|
|
|
|
Net occupancy
expense
|
|
839
|
|
|
|
|
Equipment
expense
|
|
470
|
|
|
|
|
Professional
fees
|
|
1,308
|
|
|
|
|
FDIC deposit
insurance expense
|
|
160
|
|
|
|
|
Other
expenses
|
|
1,647
|
|
|
|
|
Total Non-Interest
Expense
|
|
10,738
|
|
|
|
|
|
|
|
|
|
|
|
PRETAX
INCOME
|
|
1,319
|
|
|
|
|
Income tax
expense
|
|
389
|
|
|
|
|
NET
INCOME
|
|
930
|
|
|
|
|
Preferred stock
dividends
|
|
53
|
|
|
|
|
NET INCOME AVAILABLE
TO COMMON SHAREHOLDERS
|
877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
|
|
|
1QTR
|
2QTR
|
3QTR
|
4QTR
|
YEAR
|
|
|
|
|
|
|
TO DATE
|
INTEREST
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
8,628
|
8,590
|
8,765
|
9,137
|
35,120
|
Interest on
investments
|
|
1,074
|
1,037
|
1,046
|
1,066
|
4,223
|
Total Interest
Income
|
|
9,702
|
9,627
|
9,811
|
10,203
|
39,343
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
Deposits
|
|
1,350
|
1,288
|
1,274
|
1,252
|
5,164
|
All
borrowings
|
|
310
|
318
|
337
|
353
|
1,318
|
Total Interest
Expense
|
|
1,660
|
1,606
|
1,611
|
1,605
|
6,482
|
|
|
|
|
|
|
|
NET INTEREST
INCOME
|
|
8,042
|
8,021
|
8,200
|
8,598
|
32,861
|
Provision (credit)
for loan losses
|
|
(250)
|
150
|
-
|
(1,000)
|
(1,100)
|
|
|
|
|
|
|
|
NET INTEREST INCOME
AFTER PROVISION (CREDIT)
|
|
|
|
|
|
FOR LOAN
LOSSES
|
|
8,292
|
7,871
|
8,200
|
9,598
|
33,961
|
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
|
Trust fees
|
|
1,667
|
1,779
|
1,668
|
1,803
|
6,917
|
Investment advisory
fees
|
|
214
|
220
|
225
|
236
|
895
|
Net realized gains on
investment securities
|
|
71
|
-
|
66
|
67
|
204
|
Net realized gains on
loans held for sale
|
|
386
|
241
|
285
|
177
|
1,089
|
Service charges on
deposit accounts
|
|
511
|
538
|
560
|
564
|
2,173
|
Bank owned life
insurance
|
|
201
|
388
|
204
|
205
|
998
|
Other
income
|
|
766
|
909
|
978
|
815
|
3,468
|
Total Non-Interest
Income
|
|
3,816
|
4,075
|
3,986
|
3,867
|
15,744
|
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
6,331
|
6,176
|
6,251
|
6,357
|
25,115
|
Net occupancy
expense
|
|
773
|
751
|
694
|
719
|
2,937
|
Equipment
expense
|
|
455
|
455
|
429
|
512
|
1,851
|
Professional
fees
|
|
1,035
|
1,150
|
1,034
|
1,108
|
4,327
|
FDIC deposit
insurance expense
|
|
134
|
151
|
152
|
174
|
611
|
Other
expenses
|
|
1,894
|
1,759
|
1,853
|
1,876
|
7,382
|
Total Non-Interest
Expense
|
|
10,622
|
10,442
|
10,413
|
10,746
|
42,223
|
|
|
|
|
|
|
|
PRETAX
INCOME
|
|
1,486
|
1,504
|
1,773
|
2,719
|
7,482
|
Income tax
expense
|
|
430
|
434
|
547
|
878
|
2,289
|
NET
INCOME
|
|
1,056
|
1,070
|
1,226
|
1,841
|
5,193
|
Preferred stock
dividends
|
|
52
|
52
|
53
|
52
|
209
|
NET INCOME AVAILABLE
TO COMMON SHAREHOLDERS
|
1,004
|
1,018
|
1,173
|
1,789
|
4,984
|
|
|
|
|
|
|
|
|
AMERISERV FINANCIAL, INC.
|
|
|
AVERAGE BALANCE SHEET DATA
|
|
|
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
1QTR
|
|
1QTR
|
|
|
|
|
|
Interest earning
assets:
|
|
|
|
|
Loans and loans held
for sale, net of unearned income
|
787,306
|
|
727,505
|
Deposits with
banks
|
|
5,881
|
|
8,339
|
Short-term investment
in money market funds
|
|
4,272
|
|
3,209
|
Total investment
securities
|
|
162,789
|
|
163,636
|
Total interest
earning assets
|
|
960,248
|
|
902,689
|
|
|
|
|
|
Non-interest earning
assets:
|
|
|
|
|
Cash and due from
banks
|
|
15,970
|
|
17,220
|
Premises and
equipment
|
|
13,149
|
|
12,151
|
Other
assets
|
|
69,840
|
|
81,999
|
Allowance for loan
losses
|
|
(10,142)
|
|
(12,548)
|
|
|
|
|
|
Total
assets
|
|
1,049,065
|
|
1,001,511
|
|
|
|
|
|
Interest bearing
liabilities:
|
|
|
|
|
Interest bearing
deposits:
|
|
|
|
|
Interest bearing
demand
|
|
82,617
|
|
62,978
|
Savings
|
|
88,535
|
|
87,195
|
Money
market
|
|
228,715
|
|
213,203
|
Other time
|
|
303,140
|
|
314,019
|
Total interest
bearing deposits
|
|
703,007
|
|
677,395
|
Borrowings:
|
|
|
|
|
Federal funds
purchased and other short-term borrowings
|
29,633
|
|
7,864
|
Advances from Federal
Home Loan Bank
|
|
26,710
|
|
15,548
|
Guaranteed junior
subordinated deferrable interest debentures
|
13,085
|
|
13,085
|
Total interest
bearing liabilities
|
|
772,435
|
|
713,892
|
|
|
|
|
|
Non-interest bearing
liabilities:
|
|
|
|
|
Demand
deposits
|
|
152,811
|
|
158,251
|
Other
liabilities
|
|
9,459
|
|
18,409
|
Shareholders'
equity
|
|
114,360
|
|
110,959
|
Total liabilities and
shareholders' equity
|
|
1,049,065
|
|
1,001,511
|
SOURCE AmeriServ Financial, Inc.