Princeton National Bancorp, Inc., (NASDAQ: PNBC), the holding
company of Citizens First National Bank, today reported results of
operations and financial condition for the third quarter of 2009.
Net income for the third quarter of 2009 was $760,000 as
compared to $1,898,000 in the second quarter of 2009. Net income
available to common stockholders was $440,000, or $0.13 per diluted
share, for the quarter ended September 30, 2009, compared to net
income available to common stockholders of $1,575,000, or $0.48
earnings per diluted common share, recorded in the second quarter
of 2009. In comparison to the third quarter of 2008, earnings per
diluted common share decreased $0.53 and net income available to
common stockholders decreased $1,747,000. The lower net income is
attributable to an increase in the loan loss provision and
insurance assessments by the FDIC.
President & CEO Tony J. Sorcic stated, "The country
continues to be in a severe recession. Credit quality continues to
weaken across the nation, resulting in financial institutions
building their loan loss provisions. The decline in collateral
values continues in the housing market and the national average
unemployment rate rose in September 2009 to 9.8%. Unfortunately, in
the State of Illinois the unemployment rate is higher than the
national average and has risen to 10.5%, significantly higher than
the average of 7.2% reported by the State of Illinois at the end of
2008."
Mr. Sorcic concluded, "Unlike many institutions in the banking
industry, the Company continues to experience growth in its balance
sheet and generate positive earnings. In comparing September 30,
2009 to September 30, 2008, total deposits increased $127.4
million, total loans increased $10.1 million, net interest income
increased $2.464 million, and non-interest income increased
$337,000. The net interest margin for the first nine months was
3.45%, down 1 basis point from the same period in 2008.
Non-interest expense increased $3.781 million; which represents a
minimal increase in core operating expenses when you consider
federal insurance assessments increased $1.822 million and other
real estate expenses increased $670,000."
Net-interest income for the third quarter of 2009 (before
provision) was $8.883 million and non-interest income was $2.772
million, compared to $8.629 million and $3.731 million,
respectively, for the second quarter of 2009 and $8.172 million and
$2.851 million, respectively, for the third quarter of 2008. Return
on average equity was 3.02% for the third quarter 2009, compared to
7.77% for the second quarter 2009 and 12.54% for the third quarter
of 2008.
Total assets ended the quarter at $1.287 billion, up 2.3%, or
9.2% annualized, from $1.258 billion at June 30, 2009 and 10.7%
from $1.163 billion at December 31, 2008. Princeton National
Bancorp, Inc. experienced a $6.5 million increase and in total
loans as of September 30, 2009 compared to June 30, 2009 and an
$18.6 million decrease compared to December 31, 2008, respectively
(due to a general slowdown in the economy and the refinancing of
adjustable rate real estate loans into fixed rate products which
are sold into the secondary market).
Princeton National Bancorp, Inc. recorded a loan loss provision
of $2.410 million during the quarter, compared to $1.465 million in
the second quarter and $550,000 in the third quarter of 2008.
During the first nine months, the Company has recorded a loan loss
provision of $5.045 million versus $1.368 million for the same
period in 2008, due to the increase in non-performing loans.
Although the loan charge-offs during 2009 remain extremely low at
$2.350 million, or .40% of total loans, non-performing loans
increased $5.5 million to $38.5 million compared to $33.0 million
as of December 31, 2008. At the end of the third quarter, specific
loss provisions for individual credits totaled $1.359 million,
compared to $1.530 million at June 30, 2009 and $818,000 at
December 31, 2008. Citizens First National Bank evaluates the risk
characteristics of the loan portfolio on a monthly basis and
believes the loan loss reserve is adequate to cover estimated
losses as of September 30, 2009. The Subsidiary Bank staff will
continue to work with borrowers to resolve problem loan situations
and to work through this challenging credit cycle. Recognizing
this, and reflective of current conditions, the level of loan loss
provisioning has increased, bringing the level of reserves to 1.00%
of total loans, an increase from .64% at December 31, 2008 and .50%
at September 30, 2008.
The Board of Directors declared a $.14 per common share dividend
payable December 7, 2009 to those shareholders of record as of
November 16, 2009. This represents the Company's 99th consecutive
dividend.
On September 29, 2009, the FDIC adopted a Notice of Proposed
Rulemaking that would require insured institutions to prepay their
estimated quarterly risk-based assessments for the fourth quarter
of 2009, and all of 2010, 2011, and 2012. The Corporation estimates
the amount of the prepaid assessment to be approximately $6
million. The FDIC also announced a uniform 3-basis point increase
in the risk-based assessment effective January 1, 2011, which will
bring the Company's assessment rate to 20 basis points.
The Company's solid capital base and ability to generate core
earnings continue to be an advantage as we work through the current
credit cycle. The Subsidiary Bank has been providing financial
solutions to meet the financial needs of its customers since 1865.
Princeton National Bancorp, Inc. and Citizens First National Bank
continue to focus on positioning themselves to benefit as
conditions improve.
The price of PNBC stock closed at $15.75 on September 30, 2009,
compared to $14.60 on June 30, 2009, $14.00 on March 31, 2009 and
$22.14 on December 31, 2008. Financial stocks continue to be
impacted by poor earnings reports by many institutions, due to the
current credit cycle. Princeton National Bancorp, Inc. has reported
positive quarterly earnings for fifty-eight consecutive
quarters!
For detailed financial information, please refer to the attached
September 30, 2009 financial statements for Princeton National
Bancorp, Inc. You may also visit our website at www.pnbc-inc.com to
obtain financial information, as well as press releases, stock
prices and information on the Company.
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 $1.287 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.
CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share data)
September 30,
2009 December 31,
(unaudited) 2008
----------- -----------
ASSETS
Cash and due from banks $ 15,332 $ 20,163
Interest-bearing deposits with financial
institutions 49,690 98
Federal funds sold 0 0
----------- -----------
Total cash and cash equivalents 65,022 20,261
Loans held for sale, at lower of cost or market 5,484 2,155
Investment securities available-for-sale, at fair
value 320,978 236,883
Investment securities held-to-maturity, at
amortized cost 14,984 14,232
----------- -----------
Total investment securities 335,962 251,115
Loans, net of unearned interest 772,208 790,837
Allowance for loan losses (7,759) (5,064)
----------- -----------
Net loans 764,449 785,773
Premises and equipment, net 28,563 29,297
Land held for sale, at lower of cost or market 2,354 2,354
Federal Reserve and Federal Home Loan Bank stock 4,230 4,211
Bank-owned life insurance 22,308 21,588
Interest receivable 9,543 9,693
Goodwill, net of accumulated amortization 24,521 24,521
Intangible assets, net of accumulated
amortization 3,560 4,207
Other real estate owned 16,182 2,487
Other assets 4,881 5,468
----------- -----------
TOTAL ASSETS $ 1,287,059 $ 1,163,130
=========== ===========
LIABILITIES
Demand deposits $ 110,116 $ 110,559
Interest-bearing demand deposits 337,780 246,714
Savings deposits 65,424 61,089
Time deposits 551,493 543,770
----------- -----------
Total deposits 1,064,813 962,132
Customer repurchase agreements 50,025 35,532
Advances from the Federal Home Loan Bank 32,498 32,493
Interest-bearing demand notes issued to the U.S.
Treasury 790 2,441
Federal funds purchased 0 6,500
Trust Preferred securities 25,000 25,000
Note payable 0 16,050
----------- -----------
Total borrowings 108,313 118,016
Other liabilities 10,921 10,511
----------- -----------
Total liabilities 1,184,047 1,090,659
----------- -----------
STOCKHOLDERS' EQUITY
Preferred stock 24,951 0
Common stock 22,391 22,391
Common stock warrants 150 0
Additional paid-in capital 18,417 18,420
Retained earnings 55,575 54,329
Accumulated other comprehensive income (loss),
net of tax 5,505 1,402
Less: Treasury stock (23,977) (24,071)
----------- -----------
Total stockholders' equity 103,012 72,471
----------- -----------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 1,287,059 $ 1,163,130
=========== ===========
CAPITAL STATISTICS (UNAUDITED)
YTD average equity to average assets 7.79% 6.25%
Tier 1 leverage capital ratio 7.79% 6.22%
Tier 1 risk-based capital ratio 10.63% 7.72%
Total risk-based capital ratio 11.51% 8.30%
Common book value per share $ 23.63 $ 21.97
Closing market price per share $ 15.75 $ 22.14
End of period shares outstanding 3,303,563 3,298,041
End of period treasury shares outstanding 1,174,732 1,180,254
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except share data)
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED
September September September September
30, 30, 30, 30,
2009 2008 2009 2008
(unaudited) (unaudited) (unaudited) (unaudited)
----------- ----------- ----------- -----------
INTEREST INCOME
Interest and fees on
loans $ 10,951 $ 11,977 $ 33,494 $ 36,129
Interest and dividends
on investment
securities 3,447 2,772 9,595 8,110
Interest on federal
funds sold 0 37 0 66
Interest on
interest-bearing time
deposits in other
banks 25 26 76 46
----------- ----------- ----------- -----------
Total Interest
Income 14,424 14,812 43,164 44,351
----------- ----------- ----------- -----------
INTEREST EXPENSE
Interest on deposits 4,829 5,771 15,079 18,250
Interest on borrowings 712 869 2,178 2,658
----------- ----------- ----------- -----------
Total Interest
Expense 5,540 6,640 17,257 20,908
----------- ----------- ----------- -----------
Net interest income 8,883 8,172 25,907 23,443
Provision for loan
losses 2,410 550 5,045 1,368
----------- ----------- ----------- -----------
Net interest income
after provision 6,473 7,622 20,862 22,075
----------- ----------- ----------- -----------
NON-INTEREST INCOME
Trust & farm management
fees 296 309 1,004 1,120
Service charges on
deposit accounts 1,050 1,174 3,003 3,376
Other service charges 495 563 1,448 1,587
Gain on sales of
securities
available-for-sale 38 54 799 331
Brokerage fee income 192 249 639 676
Mortgage banking income 449 243 1,325 879
Bank-owned life
insurance 235 227 708 648
Other operating income 17 32 165 138
----------- ----------- ----------- -----------
Total Non-Interest
Income 2,772 2,851 9,092 8,755
----------- ----------- ----------- -----------
NON-INTEREST EXPENSE
Salaries and employee
benefits 4,821 4,459 13,514 13,082
Occupancy 640 619 1,952 1,908
Equipment expense 768 698 2,304 2,168
Federal insurance
assessments 566 99 2,089 267
Intangible assets
amortization 204 178 620 535
Data processing 319 272 974 852
Advertising 170 195 577 524
ORE Expenses, net 312 29 821 151
Other operating expense 1,202 1,079 3,626 3,209
----------- ----------- ----------- -----------
Total Non-Interest
Expense 9,001 7,628 26,477 22,696
----------- ----------- ----------- -----------
Income before income
taxes 244 2,845 3,477 8,134
Income tax expense (516) 658 (338) 1,836
----------- ----------- ----------- -----------
Net income 760 2,187 3,815 6,298
Preferred stock
dividends 313 0 868 0
Accretion of preferred
stock discount 7 0 18 0
----------- ----------- ----------- -----------
Net income available to
common stockholders $ 440 $ 2,187 $ 2,929 $ 6,298
=========== =========== =========== ===========
Net income per share:
BASIC $ 0.13 $ 0.66 $ 0.89 $ 1.91
DILUTED $ 0.13 $ 0.66 $ 0.89 $ 1.90
Basic weighted average
shares outstanding 3,302,172 3,295,200 3,300,148 3,298,408
Diluted weighted
average shares
outstanding 3,302,812 3,305,195 3,300,688 3,309,560
PERFORMANCE RATIOS (annualized)
Return on average
assets 0.24% 0.78% 0.41% 0.77%
Return on average
equity 3.02% 12.54% 5.29% 12.17%
Net interest margin
(tax-equivalent) 3.40% 3.50% 3.45% 3.46%
Efficiency ratio
(tax-equivalent) 72.41% 66.00% 71.38% 67.11%
ASSET QUALITY
Net loan charge-offs $ 811 $ 103 $ 2,350 $ 774
Total non-performing
loans $ 38,513 $ 16,383 $ 38,513 $ 16,383
Non-performing loans as
a % of total loans 4.99% 2.15% 4.99% 2.15%
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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