FRESNO, Calif., April 28, 2011 /PRNewswire/ -- United Security
Bancshares (http://www.unitedsecuritybank.com/) (Nasdaq Global
Select: UBFO) reported today unaudited consolidated net income of
$356,000 or $0.03 per basic and diluted common share for the
three months ended March 31, 2011, as
compared to $442,000 of $0.03 per basic and diluted common shares for the
three months ended March 31,
2010.
Annualized return on average equity (ROE) for the three months
ended March 31, 2011 was 2.06%,
compared to 2.33% for the same period in 2010. Annualized return on
average assets (ROA) was 0.22% for the three months ended
March 31, 2011 compared to 0.25% for
the same three-month period in 2010.
The Board of Directors of United Security Bancshares declared a
second quarter 2011 stock dividend of one percent (1%) on
March 22, 2011. The stock dividend
was payable to shareholders of record on April 8, 2011, and the shares were issued on
April 20, 2011.
Dennis R. Woods, President and
Chief Executive Officer of the Company, added, "We continue to work
through our problem assets and have seen reductions in the levels
of both nonaccrual and impaired loans during the first quarter of
2011. Sales of OREO properties have gained momentum during 2011
with $1.2 million in gross sales
completed during the first quarter. We have completed additional
sales on four properties so far in April
2011, and have other sales pending in escrow. During the
quarter, we have been able to reduce the level of problem assets,
while strengthening the allowance for loan losses, and generating
net income for the shareholders."
Shareholders' equity at March 31,
2011 was $73.6 million, up
$326,000 from shareholders' equity of
$73.3 million reported at
December 31, 2010.
Net interest income before provision for credit loss for the
three months ended March 31, 2011
totaled $6.2 million, down
$938,000 from $7.2 million reported during the three months
ended March 31, 2010. The net
interest margin was 4.42% for the three months ended March 31, 2011 as compared to 4.76% for the three
months ended March 31, 2010. On a
three-month comparative basis, the Company has continued to benefit
from decreasing costs on interest-bearing liabilities, but these
benefits have been outweighed by declines in yields on earning
assets as loan volumes have dropped over the past year.
Noninterest income for the three months ended March 31, 2011 totaled $1.1 million, reflecting a decrease of
$183,000 from $1.3 million in noninterest income reported for
the three months ended March 31,
2010. Customer service fees continue to provide the majority
of the Company's noninterest income, totaling $867,000 for the three months ended March 31, 2011, as compared to $948,000 for the three months ended March 31, 2010. Changes in noninterest income on
a quarter-to-quarter comparative basis are largely the result of
decreases of $524,000 in fair value
gains recorded on the Company's junior subordinated debt, which
more than offset increases of $336,000 in gains realized on the sale of other
real estate owned between the two three-month periods.
Noninterest expense totaled $6.1
million for the three months ended March 31, 2011, down $268,000 from $6.3
million reported for the three months ended March 31, 2010. Between the three-month
comparative periods, decreases in impairment losses on other real
estate owned, investment securities, and intangible assets, were
partially offset by modest increases in regulatory insurance
assessments.
For the three months ended March 31,
2011 the provision for loan loss was $890,000, compared to $9.1
million for the three months ended December 31, 2010, and $1.6 million for the three months ended
March 31, 2010. This represents a
decrease of $8.2 million between the
quarters ended March 31, 2011 and
December 31, 2010, and a decrease of
$741,000 between the quarters ended
March 31, 2011 and March 31, 2010. Net loan charge-offs totaled
$665,000 for the three months ended
March 31, 2011 as compared to
$5.6 million for the three months
ended December 31, 2010, and
$443,000 for the three months ended
March 31, 2010. With continued
weakness in the economy and real estate markets within our service
area, we continue to build the allowance for loan losses which
totaled 3.87% of total loans at March 31,
2011 compared to 3.75% of total loans at December 31, 2010, and 3.12% of total loans at
March 31, 2010. In determining the
adequacy of the allowance for loan losses, Management's judgment is
the primary determining factor for establishing the amount of the
provision for loan losses and management considers the allowance
for loan and lease losses at March 31,
2011 to be adequate.
Non-performing assets, comprised of nonaccrual loans, other real
estate owned through foreclosure (OREO), and loans more than 90
days past days and still accruing interest, decreased approximately
$4.6 million between December 31, 2010 and March 31, 2011. Nonperforming assets decreased as
a percentage of total assets from 10.40% of total assets at
December 31, 2010 to 9.83% of total
assets at March 31, 2011 as the
Company continues to successfully work out, or dispose of, problem
assets. Nonaccrual loans decreased $5.0
million between December 31,
2010 and March 31, 2011, while
OREO, decreased $429,000 during the
same period. Impaired loans totaled $48.8
million at March 31, 2011,
decreasing $2.0 million from the
balance of $50.9 million at
December 31, 2010.
United Security Bancshares is a $670+ million bank holding
company. United Security Bank, its principal subsidiary is a state
chartered bank and member of the Federal Reserve Bank of
San Francisco.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended
and the Company intends such statements to be covered by the safe
harbor provisions for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on management's knowledge
and belief as of today and include information concerning the
Company's possible or assumed future financial condition, and its
results of operations, business and earnings outlook. These
forward-looking statements are subject to risks and uncertainties.
A number of factors, some of which are beyond the Company's ability
to control or predict, could cause future results to differ
materially from those contemplated by such forward-looking
statements. These factors include (1) changes in interest rates,
(2) significant changes in banking laws or regulations, (3)
increased competition in the company's market, (4)
other-than-expected credit losses, (5) earthquake or other natural
disasters impacting the condition of real estate collateral, (6)
the effect of acquisitions and integration of acquired businesses,
(7) the impact of proposed and/or recently adopted changes in laws,
and regulations on the Company and its business, including
California tax legislation and the
subsequent Dec. 31, 2003,
announcement by the Franchise Tax Board regarding the taxation of
REITs and RICs; (8) changing bank regulatory conditions, policies,
whether arising as new legislation or regulatory initiatives or
changes in our regulatory classifications, that could lead to
restrictions on activities of banks generally or as to the Bank,
including specifically the formal order between the Federal Reserve
Bank of San Francisco and the
Company and the Bank, (9) failure to comply with the regulatory
agreement under which the Company is subject and (10) unknown
economic impacts caused by the State of
California's budget issues. Management cannot predict at
this time the severity or duration of the effects of the recent
business slowdown on our specific business activities and
profitability. Weaker or a further decline in capital and consumer
spending, and related recessionary trends could adversely affect
our performance in a number of ways including decreased demand for
our products and services and increased credit losses. Likewise,
changes in interest rates, among other things, could slow the rate
of growth or put pressure on current deposit levels and affect the
ability of borrowers to repay loans. Forward-looking statements
speak only as of the date they are made, and the company does not
undertake to update forward-looking statements to reflect
circumstances or events that occur after the date the statements
are made, or to update earnings guidance including the factors that
influence earnings. For a more complete discussion of these risks
and uncertainties, see the Company's Annual Report on Form 10-K for
the year ended December 31, 2010, and
particularly the section of Management's Discussion and Analysis.
Readers should carefully review all disclosures we file from
time to time with the Securities and Exchange Commission
("SEC").
|
|
United Security
Bancshares
|
|
Consolidated Balance
Sheets
|
|
(dollars in
thousands)
|
|
|
March
31,
|
|
December
31,
|
|
|
2011
|
|
2010
|
|
Assets
|
|
|
|
|
Cash and
noninterest-bearing deposits in other banks
|
$14,036
|
|
$13,259
|
|
Cash and due from Federal
Reserve Bank
|
89,180
|
|
85,171
|
|
Federal funds
sold
|
0
|
|
0
|
|
Cash and
cash equivalents
|
103,216
|
|
98,430
|
|
Interest-bearing deposits
in other banks
|
1,406
|
|
4,396
|
|
Investment securities (AFS
at market value)
|
51,625
|
|
51,503
|
|
Loans and leases, net of
unearned fees
|
432,264
|
|
441,046
|
|
Less: Allowance
for credit losses
|
(16,745)
|
|
(16,520)
|
|
Net loans
|
415,519
|
|
424,526
|
|
Premises and equipment -
net
|
12,738
|
|
12,909
|
|
Bank owned life
insurance
|
15,625
|
|
15,493
|
|
Intangible
assets
|
6,988
|
|
7,186
|
|
Other real estate
owned
|
35,151
|
|
35,580
|
|
Other assets
|
27,869
|
|
28,187
|
|
Total assets
|
$670,137
|
|
$678,210
|
|
Deposits:
|
|
|
|
|
Noninterest
bearing demand and NOW
|
$212,123
|
|
$199,675
|
|
Money market and
savings
|
163,124
|
|
158,253
|
|
Time
|
180,411
|
|
199,538
|
|
Total
deposits
|
555,658
|
|
557,466
|
|
Borrowed funds
|
25,000
|
|
32,000
|
|
Other
liabilities
|
4,808
|
|
4,828
|
|
Junior subordinated
debentures (at fair value)
|
11,074
|
|
10,646
|
|
Total liabilities
|
596,540
|
|
604,940
|
|
Shareholders'
equity:
|
|
|
|
|
Common shares
outstanding:
|
|
|
|
|
13,133,871
at March 31, 2011
|
|
|
|
|
13,003,849
at December 31, 2010
|
39,874
|
|
39,869
|
|
Retained
earnings
|
34,164
|
|
33,807
|
|
Accumulated other
comprehensive income
|
(441)
|
|
(406)
|
|
Total shareholders'
equity
|
73,597
|
|
73,270
|
|
Total liabilities and
shareholders' equity
|
$670,137
|
|
$678,210
|
|
|
|
|
|
|
|
|
|
United Security
Bancshares
|
|
|
|
|
Three Months Ended March
31, 2011 and 2010
|
|
(dollars in 000s, except per
share amounts)
|
|
|
Three Months
Ended
|
Three Months
Ended
|
|
|
March
31,
|
March
31,
|
|
|
2011
|
2010
|
|
Interest
income:
|
|
|
|
Interest and fees on
loans
|
$6,420
|
$7,540
|
|
Interest on investment
securities
|
597
|
868
|
|
Interest on Federal funds
sold and
|
|
|
|
deposits in
other banks
|
61
|
20
|
|
Total
interest income
|
7,078
|
8,428
|
|
Interest
expense:
|
|
|
|
Interest on
deposits
|
768
|
1,158
|
|
Interest on other
borrowed funds
|
85
|
107
|
|
Total
interest expense
|
853
|
1,265
|
|
Net interest income before
provision for credit losses
|
6,225
|
7,163
|
|
Provision for credit
losses
|
890
|
1,632
|
|
Net interest income
|
5,335
|
5,533
|
|
Noninterest
income:
|
|
|
|
Customer service
fees
|
867
|
948
|
|
Increase in cash
surrender value of
|
|
|
|
bank owned
life insurance
|
141
|
134
|
|
Gain on sale of
loans
|
0
|
0
|
|
Loss on sale of other real
estate owned
|
280
|
(56)
|
|
(Loss) gain on Fair Value
Option of Financial Assets
|
(367)
|
157
|
|
Other noninterest
income
|
207
|
128
|
|
Total noninterest
income
|
1,128
|
1,311
|
|
Noninterest
expense:
|
|
|
|
Salaries and employee
benefits
|
2,321
|
2,281
|
|
Occupancy
expense
|
893
|
913
|
|
Professional
fees
|
439
|
387
|
|
Regulatory insurance
assessments
|
513
|
391
|
|
Impairment losses and
other expenses on OREO
|
916
|
1,103
|
|
Impairment losses on
goodwill and intangible assets
|
36
|
57
|
|
Impairment losses on
investment securities
|
0
|
244
|
|
Other noninterest
expense
|
939
|
949
|
|
Total noninterest
expense
|
6,057
|
6,325
|
|
Income before income tax
provision
|
406
|
518
|
|
Provision for income
taxes
|
50
|
76
|
|
Net Income
|
$356
|
$442
|
|
|
|
|
|
|
|
|
|
United Security
Bancshares
|
|
Selected Financial Data
(Quarters Unaudited)
|
|
(dollars in 000s, except per
share amounts)
|
|
|
Three months
Ended
|
Three months
Ended
|
|
|
March
31,
|
March
31,
|
|
|
2011
|
2010
|
|
Basic earnings per
share
|
$0.03
|
$0.03
|
|
Diluted earnings per
share
|
$0.03
|
$0.03
|
|
Weighted average basic shares
for EPS
|
13,133,871
|
13,133,871
|
|
Weighted average diluted shares
for EPS
|
13,133,871
|
13,133,871
|
|
|
|
|
|
Annualized return on:
|
|
|
|
Average assets
|
0.22%
|
0.25%
|
|
Average equity
|
2.06%
|
2.33%
|
|
Yield on interest-earning
assets
|
5.03%
|
5.60%
|
|
Cost of interest-bearing
liabilities
|
0.79%
|
1.04%
|
|
Net interest margin
|
4.42%
|
4.76%
|
|
Annualized net charge-offs to
average loans
|
0.62%
|
0.35%
|
|
|
|
|
|
|
March
31,
|
December
31,
|
|
|
2011
|
2010
|
|
Shares outstanding - period
end
|
13,133,871
|
13,003,840
|
|
Book value per share
|
$5.66
|
$5.63
|
|
Tangible book value per
share
|
$5.12
|
$5.08
|
|
Efficiency ratio
|
82.36%
|
85.76%
|
|
Total nonperforming
assets
|
$65,906
|
$70,521
|
|
Nonperforming assets to total
assets
|
9.83%
|
10.40%
|
|
Total Impaired loans
|
$48,849
|
$50,881
|
|
Total nonaccrual
loans
|
$29,398
|
$34,394
|
|
Allowance for loan losses to
total loans
|
3.87%
|
3.75%
|
|
|
|
|
SOURCE United Security Bancshares