Texas United Bancshares, Inc. Announces 38% Increase in First
Quarter Earnings LA GRANGE, Texas, May 5 /PRNewswire-FirstCall/ --
Texas United Bancshares, Inc. today reported first quarter 2004 net
income of $1.6 million or $0.37 per diluted share, an increase of
$434,000 or $0.10 per diluted share, compared to the first quarter
of 2003. The annualized return on average assets was 0.96% and the
annualized return on average equity was 15.3% for the first quarter
of 2004. Other financial results for the quarter included net
interest income of $6.7 million before provision for loan losses,
up 3.1% from the first quarter 2003. The net interest margin for
the first quarter of 2004 and 2003 was 4.63% and 5.18%,
respectively. Average total loans, including loans held for sale,
for the first quarter 2004 were up $13.1 million, a 3.5% increase
from the first quarter of 2003. Average deposits for the first
quarter of 2004 were up $61.8 million, a 13.5% increase from the
first quarter of 2003. Non-interest income was $3.7 million in the
first quarter of 2004, compared to $2.6 million for the same period
in 2003. The increase is attributed to the $1.2 million in mortgage
fees generated from Community Home Loan, Inc. which was acquired in
February of 2004. Non-interest expenses for the quarter were $7.9
million, compared to $6.7 million for the same period in 2003. The
increase is primarily attributed to the $1.2 million in employee
compensation and benefits and other operating expenses from
Community Home Loan, Inc. The provision for loan losses was
$150,000 in the first quarter 2004, compared to $800,000 in the
same quarter in 2003. The Company increased its provisions during
2003 primarily due to the growth in the loan portfolio, changes in
the Central Texas economy, and the increase in net charge-offs.
Non-performing assets totaled $2.4 million or 0.59% of loans and
other real estate at March 31, 2004 compared to $2.3 million or
0.59% of loans and other real estate at December 31, 2003. For the
three months ended March 31, 2004, the Company had net recoveries
of $50,000. Charge-offs for the first three months ended March 31,
2004 are down from 2003 levels primarily due to the sale of State
Bank's credit card portfolio in the fourth quarter of 2003. Net
charge-offs were $2.3 million or 0.61% of average loans for the
year ended December 31, 2003. The allowance for loan losses totaled
$4.1 million at March 31, 2004 compared to $3.9 million at December
31, 2003. As of March 31, 2004 Texas United Bancshares, Inc. had
total assets of $658.7 million and total deposits of $536.7
million. Shareholders' equity of $40.8 million represented 6.2% of
total assets. Texas United Bancshares, Inc. is a registered
financial holding company listed on the Nasdaq National Market
under the symbol "TXUI". Its wholly owned subsidiary, State Bank,
offers a complete range of banking services through 18 full service
banking centers located in the greater central and south central
Texas area. In addition, State Bank has seven mortgage loan
production offices located in Houston and San Antonio through its
wholly owned subsidiary Community Home Loan, Inc. Except for
historical information, certain of the matters discussed in this
news release may constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
that involve risks and uncertainties, including, but not limited
to, the following: general business and economic conditions in the
markets Texas United serves may be less favorable than expected
which could decrease the demand for loan, deposit and other
financial services and increase loan delinquencies and defaults;
changes in the interest rate environment which could reduce Texas
United's net interest margin; acquisition integration may be more
difficult than anticipated; legislative or regulatory developments
including changes in laws concerning taxes, banking, securities,
insurance and other aspects of the financial securities industry;
competitive factors may increase, including product and pricing
pressures among financial services organizations; and changes in
accounting principles, policies or guidelines. All written or oral
forward-looking statements are expressly qualified in their
entirety by these cautionary statements. Please also read the
additional risks and factors described from time to time in the
company's reports and registration statements filed with the
Securities and Exchange Commission. Copies of our Company filings
are available on our website http://www.statebanktx.com/ under the
caption of investor relations. Texas United Bancshares, Inc.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED) 2004 2003 1st Qtr 4th
Qtr 3rd Qtr 2nd Qtr 1st Qtr CONDENSED INCOME STATEMENTS ($ in
thousands) Net interest income $6,664 $6,815 $7,035 $6,793 $6,498
Provision for loan losses 150 800 800 500 800 Non-interest income
Service charges on deposit accounts 1,597 1,737 1,718 1,689 1,609
Net servicing fees (3) 76 1,401 132 18 Net gain on securities
transactions 77 3 376 684 231 Other 2,020 1,251 654 884 721 Total
non-interest income 3,691 3,067 4,149 3,389 2,579 Non-interest
expense Employee compensation and benefits 4,274 4,375 4,509 4,349
3,456 Occupancy 1,088 1,142 1,214 1,144 1,121 Other 2,575 2,210
2,465 2,166 2,139 Total non-interest expense 7,937 7,727 8,188
7,659 6,716 Income before provision for taxes 2,268 1,355 2,196
2,023 1,561 Income taxes 703 166 667 631 430 Net income $1,565
$1,189 $1,529 $1,392 $1,131 PER SHARE DATA Net income - basic $0.39
$0.30 $0.38 $0.35 $0.29 Net income - diluted 0.37 0.29 0.37 0.34
0.27 Cash dividends 0.07 0.07 0.07 0.07 0.07 Book value 10.17 9.49
9.11 9.67 9.28 Period-end common shares outstanding 4,017 4,002
3,995 3,995 3,968 Weighted average shares - basic 4,010 4,000 3,995
3,978 3,965 Weighted average shares - diluted 4,193 4,154 4,163
4,139 4,120 SELECTED ANNUALIZED RATIOS Return on average assets
0.96% 0.75% 0.97% 0.93% 0.79% Return on average equity 15.33 12.86
16.70 14.38 12.70 Net interest margin to average earning assets
4.63 4.75 4.91 5.16 5.18 Texas United Bancshares, Inc. CONSOLIDATED
FINANCIAL SUMMARY (UNAUDITED) 2004 2003 1st Qtr 4th Qtr 3rd Qtr 2nd
Qtr 1st Qtr BALANCE SHEET SUMMARY ($ in thousands) Average Balance:
Loans (including loans held for sale) $391,820 $376,623 $384,748
$367,909 $378,671 Earning assets 578,730 568,074 568,068 527,609
509,197 Total assets 650,610 632,285 631,398 601,609 581,287 Total
deposits 517,797 505,431 501,208 476,178 456,016 Shareholders'
equity 40,845 36,970 36,621 38,728 36,128 Period-End Balance: Net
Loans (including loans held for sale) $402,747 $380,438 $369,542
$365,930 $354,269 Earning assets 589,071 568,878 560,158 543,863
521,431 Goodwill and intangible assets 14,365 13,940 14,259 12,896
12,798 Total assets 658,720 637,319 630,142 614,374 591,661 Total
deposits 536,749 501,631 503,706 495,614 474,599 Shareholders'
equity 40,845 37,987 36,396 38,647 36,821 ASSET QUALITY ($ in
thousands) Allowance for loan losses: $4,093 $3,893 $3,896 $3,584
$3,593 As a percentage of period-end loans 1.01% 1.01% 1.04% 0.97%
1.00% Net (recoveries) charge-offs: $(50) $803 $488 $509 $503 As a
percentage of average loans (annualized) ---% 0.85% 0.51% 0.55%
0.54% Non-performing assets: Past due and non-accrual $2,073 $1,988
$1,373 $1,445 $1,633 Other real estate 333 273 449 369 375 Total
$2,406 $2,261 $1,822 $1,814 $2,008 As a percentage of: Total assets
0.37% 0.35% 0.29% 0.30% 0.34% Total loans plus other real estate
0.59 0.59 0.49 0.49 0.56 CONSOLIDATED CAPITAL RATIOS Tier 1
risk-based capital ratio 9.61% 9.54% 8.09% 8.35% 8.32% Total
risk-based capital ratio 10.56 10.47 9.01 9.26 9.27 Tier 1 leverage
ratio 6.46 6.46 5.47 5.56 5.52 DATASOURCE: Texas United Bancshares,
Inc. CONTACT: Tom Adams of Texas United Bancshares, Inc.,
+1-979-968-7261 Web site: http://www.statebanktx.com/
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