PRINCETON, IL
President Tony J. Sorcic stated, "Princeton National Bancorp,
Inc. is excited to announce record earnings for the first six
months of 2008. Net income of $4,111,000 represents a 37.9%
increase over the 2007 net income of $2,982,000. Fully diluted
earnings per share for the same period of $1.24 represent a 39.3%
increase over the 2007 fully diluted earnings per share of $.89.
Additionally, the return on average equity increased 30.5% to
11.98% from 9.18%."
Mr. Sorcic continued, "The positive trend in net interest income
continued throughout the first six months of 2008. Princeton
National Bancorp, Inc.'s net interest margin (tax equivalent) grew
to 3.44% from 3.13% for the same six-month period in 2007. Based on
the current level of assets, this equates to an increase in net
(annualized pre-tax) interest income of $2,400,000. The net
interest income for the six months ending June 30, 2008 was
$15,271,000, compared to $12,978,000 for the first six months of
2007. Management believes the net interest margin will continue to
increase throughout the remainder of 2008."
Mr. Sorcic concluded, "Citizens First National Bank, the
subsidiary bank, has been serving customers since 1865 in good
times and challenging times. Princeton National Bancorp, Inc. and
Citizens First National Bank are very strong organizations with
long and successful track records."
It is with great regret the Company announces the retirement of
Thomas M. Longman effective July 28, 2008 due to his relocation
outside of the Company's market area. Mr. Longman has been a
long-time Director and great asset to the Company. His support,
input and dedication will truly be missed. We wish him well in his
retirement.
Non-interest income generated during the six-month period of
2008 totaled $5,904,000, a $537,000 (10.0%) improvement over 2007.
The Company remains focused on increasing non-interest income by
expanding products and services that are attractive to the
customer. The Company's non-interest income has equaled or exceeded
1% of average assets for 32 consecutive quarters.
As a percentage of average assets, non-interest expense for the
six months ended June 30, 2008 was 2.80%, compared to 2.88% for the
six months ended June 30, 2007. Operating expenses are
well-controlled and emphasis will continue to be placed on
improving efficiencies.
In comparing the second quarter of 2008 to the same period in
2007, net income of $2.020 million increased 30.1% from $1.553
million, fully diluted earnings per share increased 32.6%, net
interest income increased 18.67%, and the return on average equity
increased 22.5%.
Assets at June 30, 2008 reached a record high of $1.105 billion.
During the first six months of 2008, total loans have increased
$23.6 million, ending the period at $746,234,000. The loan-to-asset
ratio increased to 67.5% as of June 30, 2008 from 66.9% at December
31, 2007. The Subsidiary Bank has no sub-prime loans in its loan
portfolio. The non-performing loans represent 1.95% of the total
loan portfolio at June 30, 2008. The Subsidiary Bank currently has
$62.1 million in its commercial banking pipeline, which, if funded,
should help continue the improvement in the net interest margin.
The Company had total deposits and repurchase agreements of $939.3
million, a $13.7 million increase from $925.6 million at December
31, 2007.
Princeton National Bancorp, Inc.'s strategies to grow the
Company, improve the net interest margin, control expenses and
provide a consistent return to shareholders is evidenced by the
increases in fully diluted earnings per share, net income, net
interest margin, loans and the loan-to-asset ratio and the decrease
in non-interest expense as a percent of average assets. Additional
financial information is available at www.pnbc-inc.com.
In April 2008, the Board of Directors of Princeton National
Bancorp, Inc. announced a 6-month extension of the 50,000 share
stock repurchase plan declared in April 2007. During the second
quarter 10,000 shares were purchased under the Plan at an average
price of $28.38. There are currently 20,000 shares remaining under
this plan. The Company currently has 3,295,184 outstanding shares
of common stock. Since 1997, the Company has repurchased a total of
1,364,271 shares through stock repurchase programs.
The stock price closed at $27.24 on June 30, 2008, compared to
$24.25 on December 31, 2007 and $27.60 on June 30, 2007. Financial
stocks continue to be negatively impacted by the poor earnings
reports of many institutions, due to compressed net interest
margins, loan charge-offs and sub-prime loan issues. As stated in
previous communications, the Company has no sub-prime loans in its
loan portfolio or as underlying collateral in its investment
portfolio.
The Company offers shareholders the opportunity to participate
in the Princeton National Bancorp, Inc. Dividend Reinvestment and
Stock Purchase Plan. The Company also offers electronic direct
deposit of dividends. To obtain information about the stock
purchase plan or electronic direct deposit, please contact us at
815-875-4445, extension 650.
Princeton National Bancorp, Inc. is the parent holding company
of Citizens First National Bank, a $1.105 billion community bank
with strategic locations in 8 counties in northern Illinois. The
Company is well-positioned in the high growth counties of Will,
Kendall, Kane, Grundy, DeKalb and LaSalle plus Bureau and Marshall.
Communities include: Aurora, DePue, Genoa, Hampshire, Henry,
Huntley, Millbrook, Minooka, Newark, Oglesby, Peru, Plainfield,
Plano, Princeton, Sandwich, Somonauk and Spring Valley. The
Subsidiary Bank, Citizens First National Bank, provides financial
services to meet the needs of individuals, businesses and public
entities.
This press release contains certain forward-looking statements,
including certain plans, expectations, goals, and projections,
which are subject to numerous assumptions, risks, and
uncertainties. These forward-looking statements are identified by
the use of words such as 1) believes, 2) anticipates, 3) estimates,
4) expects, 5) projects or similar words. Actual results could
differ materially from those contained or implied by such
statements for a variety of factors including: changes in economic
conditions; movements in interest rates; competitive pressures on
product pricing and services; success and timing of business
strategies; the nature, extent, and timing of governmental actions
and reforms; and extended disruption of vital infrastructure. The
figures included in this press release are unaudited and may vary
from the audited results.
Princeton National Bancorp, Inc.
CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share data) June 30,
2008 December 31,
(unaudited) 2007
----------- -----------
ASSETS
Cash and due from banks $ 26,297 $ 25,801
Interest-bearing deposits with financial
institutions 102 1,803
Federal funds sold 0 0
----------- -----------
Total cash and cash equivalents 26,399 27,604
Loans held for sale, at lower of cost or market 3,324 928
Investment securities available-for-sale, at fair
value 220,617 218,095
Investment securities held-to-maturity, at
amortized cost 15,608 14,578
----------- -----------
Total investment securities 236,225 232,673
Loans, net of unearned interest 746,234 722,647
Allowance for loan losses (3,396) (3,248)
----------- -----------
Net loans 742,838 719,399
Premises and equipment, net 30,374 30,801
Land held for sale, at lower of cost or market 1,344 1,344
Bank-owned life insurance 21,256 22,461
Interest receivable 8,764 10,876
Goodwill, net of accumulated amortization 24,521 24,521
Intangible assets, net of accumulated
amortization 4,648 5,090
Other real estate owned 851 833
Other assets 4,642 4,172
----------- -----------
TOTAL ASSETS $ 1,105,186 $ 1,080,702
=========== ===========
LIABILITIES
Demand deposits $ 103,597 $ 102,452
Interest-bearing demand deposits 252,954 241,749
Savings deposits 63,524 58,401
Time deposits 484,198 488,805
----------- -----------
Total deposits 904,273 891,407
Customer repurchase agreements 35,079 34,217
Advances from the Federal Home Loan Bank 23,488 6,984
Interest-bearing demand notes issued to the U.S.
Treasury 2,215 1,838
Federal funds purchased 21,300 26,500
Trust Preferred securities 25,000 25,000
Note payable 14,550 14,550
----------- -----------
Total borrowings 121,632 109,089
Other liabilities 10,245 11,599
----------- -----------
Total liabilities 1,036,150 1,012,095
----------- -----------
STOCKHOLDERS' EQUITY
Common stock 22,391 22,391
Surplus 18,358 18,275
Retained earnings 52,960 51,279
Accumulated other comprehensive income (loss),
net of tax (553) 344
Less: Treasury stock (24,120) (23,682)
----------- -----------
Total stockholders' equity 69,036 68,607
----------- -----------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 1,105,186 $ 1,080,702
=========== ===========
CAPITAL STATISTICS (UNAUDITED)
YTD average equity to average assets 6.39% 6.33%
Tier 1 leverage capital ratio 6.19% 6.16%
Tier 1 risk-based capital ratio 7.93% 8.00%
Total risk-based capital ratio 8.35% 8.41%
Book value per share $ 20.95 $ 20.66
Closing market price per share $ 27.24 $ 24.25
End of period shares outstanding 3,295,184 3,308,447
End of period treasury shares outstanding 1,183,111 1,169,848
Princeton National Bancorp, Inc.
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except share data)
THREE THREE SIX SIX
MONTHS MONTHS MONTHS MONTHS
ENDED ENDED ENDED ENDED
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
(unaudited)(unaudited)(unaudited)(unaudited)
--------- --------- --------- ---------
INTEREST INCOME
Interest and fees on loans $ 11,801 $ 12,293 $ 24,152 $ 23,900
Interest and dividends on
investment securities 2,659 2,840 5,338 5,853
Interest on federal funds sold 4 75 29 221
Interest on interest-bearing
time deposits in other banks 9 26 20 76
--------- --------- --------- ---------
Total Interest Income 14,473 15,234 29,539 30,050
--------- --------- --------- ---------
INTEREST EXPENSE
Interest on deposits 5,805 7,622 12,479 15,101
Interest on borrowings 851 1,025 1,789 1,971
--------- --------- --------- ---------
Total Interest Expense 6,656 8,647 14,268 17,072
--------- --------- --------- ---------
Net interest income 7,817 6,587 15,271 12,978
Provision for loan losses 450 115 818 300
--------- --------- --------- ---------
Net interest income after
provision 7,367 6,472 14,453 12,678
--------- --------- --------- ---------
NON-INTEREST INCOME
Trust & farm management fees 336 357 812 771
Service charges on deposit
accounts 1,110 1,095 2,202 2,085
Other service charges 567 497 1,024 958
Gain on sales of securities
available-for-sale 0 162 276 209
Brokerage fee income 208 214 427 417
Mortgage banking income 288 137 636 409
Bank-owned life insurance 206 209 421 405
Other operating income 36 51 106 113
--------- --------- --------- ---------
Total Non-Interest Income 2,751 2,722 5,904 5,367
--------- --------- --------- ---------
NON-INTEREST EXPENSE
Salaries and employee benefits 4,226 4,137 8,623 8,317
Occupancy 611 598 1,290 1,201
Equipment expense 751 837 1,470 1,615
Federal insurance assessments 84 86 168 170
Intangible assets amortization 178 164 357 351
Data processing 302 257 579 530
Advertising 162 178 330 351
Other operating expense 1,195 1,137 2,252 2,131
--------- --------- --------- ---------
Total Non-Interest Expense 7,509 7,393 15,069 14,666
--------- --------- --------- ---------
Income before income taxes 2,609 1,800 5,288 3,379
Income tax expense 589 247 1,177 397
--------- --------- --------- ---------
Net income $ 2,020 $ 1,553 $ 4,111 $ 2,982
========= ========= ========= =========
Net income per share:
BASIC $ 0.61 $ 0.47 $ 1.25 $ 0.89
DILUTED $ 0.61 $ 0.46 $ 1.24 $ 0.89
Basic weighted average shares
outstanding 3,295,998 3,333,897 3,300,030 3,340,462
Diluted weighted average shares
outstanding 3,309,084 3,344,557 3,311,735 3,354,268
PERFORMANCE RATIOS (annualized)
Return on average assets 0.75% 0.60% 0.76% 0.58%
Return on average equity 11.71% 9.56% 11.98% 9.18%
Net interest margin
(tax-equivalent) 3.49% 3.15% 3.44% 3.13%
Efficiency ratio
(tax-equivalent) 67.71% 74.67% 67.68% 75.04%
ASSET QUALITY
Net loan charge-offs $ 189 $ 142 $ 670 $ 243
Total non-performing loans $ 14,567 $ 4,809 $ 14,567 $ 4,809
Non-performing loans as a % of
total loans 1.95% 0.72% 1.95% 0.72%
Inquiries should be directed to: Lou Ann Birkey Vice President -
Investor Relations Princeton National Bancorp, Inc. (815) 875-4444
E-Mail address: Email Contact
Princeton National Bancorp (CE) (USOTC:PNBC)
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