TCBK TriCo Bancshares

TriCo Bancshares (NASDAQ:TCBK), parent company of Tri Counties Bank, today announced record quarterly earnings of $5,961,000 for the quarter ended September 30, 2005. This represents a 14.6% increase when compared with earnings of $5,203,000 for the quarter ended September 30, 2004. Diluted earnings per share for the quarter ended September 30, 2005 increased 15.6% to $0.37 from $0.32 for the quarter ended September 30, 2004. Total assets of the Company increased $212,310,000 (13.5%) to $1,786,856,000 at September 30, 2005 from $1,574,546,000 at September 30, 2004. Total loans of the Company increased $201,667,000 (17.9%) to $1,328,090,000 at September 30, 2005 from $1,126,423,000 at September 30, 2004. Total deposits of the Company increased $146,158,000 (11.3%) to $1,438,299,000 at September 30, 2005 from $1,292,141,000 at September 30, 2004. Diluted earnings per share for the nine months ended September 30, 2005 and 2004 were $1.04 and $0.91, respectively, on earnings of $16,937,000 and $14,827,000, respectively. The improvement in results from the year-ago quarter was due to a $1,374,000 (7.3%) increase in fully tax-equivalent (FTE) net interest income to $20,086,000, a $219,000 (18.8%) decrease in provision for loan losses to $947,000, and a $271,000 (4.3%) increase in noninterest income to $6,632,000. These contributing factors were partially offset by a $457,000 (3.0%) increase in noninterest expense to $15,680,000 for the quarter ended September 30, 2005. The increase in net interest income (FTE) was due to a $175,050,000 (12.5%) increase in average balances of interest-earning assets to $1,574,392,000 offset by a 0.25% decrease in net interest margin (FTE) to 5.10%. The decrease in net interest margin from the year-ago quarter was mainly due to rising short-term interest rates, and steady to declining long-term interest rates, during the period from June 30, 2004 to September 30, 2005. The $219,000 decrease in provision for loan losses was due to the continued excellent credit quality of the Company's loan portfolio. Net loan charge-offs during the quarter were $43,000. Nonperforming loans, net of government agency guarantees, were $3,048,000 at September 30, 2005 compared to $4,906,000 and $4,931,000 at December 31, 2004 and September 30, 2004, respectively. The Company's allowance for losses, which consists of the allowance for loan losses and the reserve for unfunded commitments, was $17,470,000 or 1.32% of total loans outstanding and 573% of nonperforming loans at September 30, 2005 compared to $16,216,000 or 1.44% of total loans outstanding and 329% of nonperforming loans at September 30, 2004. Included in the results for the year-ago quarter ended September 30, 2004 was $384,000 from gain on sale of other real estate. Excluding this item, noninterest income for the quarter ended September 30, 2004 would have been $5,977,000, and the $6,632,000 of noninterest income for the quarter ended September 30, 2005 would have represented a $655,000 (11.0%) increase. Noninterest expense for the third quarter of 2005 increased $457,000 (3.0%) to $15,680,000 from $15,223,000 in the third quarter of 2004. The increase in noninterest expense was the result of a $265,000 (3.2%) increase in salary and benefit expense to $8,584,000 and a $192,000 (2.8%) net increase in other noninterest expense categories to $7,096,000. The increase in salary and benefits expense was the net result of annual salary increases, new employees from the opening of de-novo branches in Woodland (November 2004), and Lincoln (February 2005), offset by reduced incentive commissions, overtime, and workers compensation expense. Included in the $192,000 net increase in other noninterest income categories was a $293,000 increase in advertising expense, and a $408,000 decrease in professional fees. As of September 30, 2005, the Company had repurchased 351,100 shares of its common stock under its stock repurchase plan announced on July 31, 2003 and amended on April 9, 2004, which left 148,900 shares available for repurchase under the plan. Richard Smith, President and Chief Executive Officer commented, "We are pleased with the performance of our company during the quarter ended September 30, 2005. Loan and deposit balances increased 17.9% and 11.3%, respectively, when compared to year-ago quarter end balances. Our net interest margin and credit quality have remained excellent and stable throughout 2005. As a result, our earnings and our growth in earnings remain strong while we continue to execute our ambitious expansion strategy. The grand opening of our Sacramento Financial Center was received very positively by the Sacramento community. We are confident this branch will perform well as the hub connecting all of our in-store branches in the Sacramento region. Riding closely on the heels of our Sacramento hub, our next new branch will open on November 2 inside a newly constructed Wal-Mart Super Center in Roseville, which is a strong market that we have specifically targeted for future growth. Additional plans for expansion include three new in-store branches in the first quarter of 2006 in Sacramento, Yuba City and Redding, adding more convenience and service for our strong foundation in these communities." Tri Counties Bank has been aggressively opening new branches throughout Sacramento for the past five years. The bank announced last summer its plan to open six additional branches in the Sacramento area, three of which have already started serving customers inside Raley's and Bel Air supermarkets in Woodland, Lincoln and Folsom. In addition to the historical information contained herein, this press release contains certain forward-looking statements. The reader of this press release should understand that all such forward-looking statements are subject to various uncertainties and risks that could affect their outcome. The Company's actual results could differ materially from those suggested by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, variances in the actual versus projected growth in assets, return on assets, loan losses, expenses, rates charged on loans and earned on securities investments, rates paid on deposits, competition effects, fee and other noninterest income earned as well as other factors. This entire press release should be read to put such forward-looking statements in context and to gain a more complete understanding of the uncertainties and risks involved in the Company's business. TriCo Bancshares and Tri Counties Bank are headquartered in Chico, California. Tri Counties Bank has a 30-year history in the banking industry. Tri Counties Bank operates 32 traditional branch locations and 15 in-store branch locations in 22 California counties. Tri Counties Bank offers financial services and provides a diversified line of products and services to consumers and businesses, which include demand, savings and time deposits, consumer finance, online banking, mortgage lending, and commercial banking throughout its market area. It operates a network of 60 ATMs and a 24-hour, seven days a week telephone customer service center. Brokerage services are provided at the Bank's offices by the Bank's association with Raymond James Financial, Inc. For further information please visit the Tri Counties Bank web-site at http://www.tricountiesbank.com. -0- *T TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA (Unaudited. Dollars in thousands, except per share data) Three months ended ------------------------------------- September 30, June 30, March 31, 2005 2005 2005 ------------- ----------- ----------- Statement of Income Data Interest income $25,334 $23,910 $22,636 Interest expense 5,519 4,789 4,121 Net interest income 19,815 19,121 18,515 Provision (benefit) for loan losses 947 561 100 Noninterest income: Service charges and fees 4,795 4,505 4,062 Other income 1,837 1,805 1,265 Total noninterest income 6,632 6,310 5,327 Noninterest expense: Salaries and benefits 8,584 8,408 8,369 Intangible amortization 346 346 343 Provision for losses - unfunded commitments 3 39 100 Other expense 6,747 6,724 6,301 Total noninterest expense 15,680 15,517 15,113 Income before taxes 9,820 9,353 8,629 Net income $5,961 $5,737 $5,239 Share Data(1) Basic earnings per share $0.38 $0.37 $0.33 Diluted earnings per share 0.37 0.35 0.32 Book value per common share 9.30 9.10 8.87 Tangible book value per common share $8.04 $7.81 $7.57 Shares outstanding 15,728,106 15,684,092 15,733,517 Weighted average shares 15,687,547 15,701,867 15,729,725 Weighted average diluted shares 16,330,035 16,288,728 16,366,705 Credit Quality Non-performing loans, net of government agency guarantees $3,048 $2,922 $4,072 Other real estate owned - - - Loans charged-off 479 513 295 Loans recovered $436 $281 $233 Allowance for losses to total loans(2) 1.32% 1.32% 1.37% Allowance for losses to NPLs(2) 573% 567% 398% Allowance for losses to NPAs(2) 573% 567% 398% Selected Financial Ratios Return on average total assets 1.37% 1.37% 1.29% Return on average equity 16.26% 16.03% 14.83% Average yield on loans 6.93% 6.85% 6.69% Average yield on interest- earning assets 6.51% 6.39% 6.25% Average rate on interest- bearing liabilities 1.79% 1.62% 1.43% Net interest margin (fully tax-equivalent) 5.10% 5.12% 5.12% Total risk based capital ratio 11.2% 11.5% 11.9% Tier 1 Capital ratio 10.1% 10.5% 10.8% Three months ended -------------------------------- December 31, September 30, 2004 2004 --------------- ---------------- Statement of Income Data Interest income $22,441 $21,951 Interest expense 3,768 3,494 Net interest income 18,673 18,457 Provision (benefit) for loan losses (183) 1,166 Noninterest income: Service charges and fees 4,266 4,436 Other income 1,470 1,925 Total noninterest income 5,736 6,361 Noninterest expense: Salaries and benefits 8,265 8,319 Intangible amortization 343 343 Provision for losses - unfunded commitments 483 134 Other expense 6,724 6,427 Total noninterest expense 15,815 15,223 Income before taxes 8,777 8,429 Net income $5,355 $5,203 Share Data(1) Basic earnings per share $0.34 $0.33 Diluted earnings per share 0.33 0.32 Book value per common share 8.79 8.64 Tangible book value per common share $7.45 $7.33 Shares outstanding 15,723,317 15,697,817 Weighted average shares 15,712,605 15,672,300 Weighted average diluted shares 16,396,447 16,254,005 Credit Quality Non-performing loans, net of government agency guarantees $4,906 $4,931 Other real estate owned - - Loans charged-off 579 687 Loans recovered $120 $74 Allowance for losses to total loans(2) 1.37% 1.44% Allowance for losses to NPLs(2) 327% 329% Allowance for losses to NPAs(2) 327% 329% Selected Financial Ratios Return on average total assets 1.35% 1.34% Return on average equity 15.44% 15.57% Average yield on loans 6.82% 6.87% Average yield on interest- earning assets 6.33% 6.35% Average rate on interest- bearing liabilities 1.35% 1.25% Net interest margin (fully tax-equivalent) 5.28% 5.35% Total risk based capital ratio 11.9% 12.4% Tier 1 Capital ratio 10.7% 11.0% (1) Share and per share data for all periods have been adjusted to reflect the 2-for-1 stock split announced March 11, 2004 payable on April 30, 2004 to shareholders of record on April 9, 2004. (2) Allowance for losses includes allowance for loan losses and reserve for unfunded commitments. TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA (Unaudited. Dollars in thousands, except per share data) Three months ended ------------------------------------------------------ September June March December September 30, 30, 31, 31, 30, 2005 2005 2005 2004 2004 ---------- ---------- ---------- ---------- ---------- Balance Sheet Data Cash and due from banks $85,413 $79,287 $77,365 $70,037 $64,318 Federal funds sold 218 235 181 - - Securities, available- for-sale 271,134 288,902 293,730 286,013 286,067 Federal Home Loan Bank Stock 7,516 7,440 6,781 6,781 6,719 Loans Commercial loans 141,057 137,620 125,354 140,332 151,998 Consumer loans 494,277 456,247 425,437 410,198 384,560 Real estate mortgage loans 600,875 573,836 556,059 544,373 527,808 Real estate construction loans 91,881 82,349 75,583 78,064 62,057 Total loans, gross 1,328,090 1,250,052 1,182,433 1,172,967 1,126,423 Allowance for loan losses (15,796) (14,892) (14,563) (14,525) (15,167) Premises and equipment 21,223 21,182 20,599 19,853 20,118 Cash value of life insurance 41,519 41,099 40,699 40,479 40,196 Goodwill 15,519 15,519 15,519 15,519 15,519 Intangible assets 4,373 4,719 5,065 5,408 5,070 Other assets 27,647 27,100 27,803 24,974 25,283 Total assets 1,786,856 1,720,643 1,655,612 1,627,506 1,574,546 Deposits Noninterest- bearing demand deposits 346,456 332,887 312,738 311,275 298,319 Interest- bearing demand deposits 243,926 236,134 238,787 230,763 224,619 Savings deposits 449,893 466,062 484,660 474,414 474,345 Time certificates 398,024 365,094 362,564 332,381 294,858 Total deposits 1,438,299 1,400,177 1,398,749 1,348,833 1,292,141 Federal funds purchased & repurchase agreements 103,200 83,000 20,700 46,400 57,300 Reserve for unfunded commitments 1,674 1,671 1,632 1,532 1,049 Other liabilities 24,412 24,161 25,483 23,219 19,971 Other borrowings 31,711 27,628 28,176 28,152 27,159 Junior subordinated debt 41,238 41,238 41,238 41,238 41,238 Total liabilities 1,640,534 1,577,875 1,515,978 1,489,374 1,438,858 Total shareholders' equity 146,322 142,768 139,634 138,132 135,688 Accumulated other comprehensive income (loss) (2,538) (1,468) (2,242) (352) 1,155 Average loans 1,284,977 1,209,061 1,167,039 1,142,483 1,098,442 Average interest- earning assets 1,574,392 1,511,668 1,464,028 1,433,641 1,399,342 Average total assets 1,744,015 1,679,653 1,628,827 1,592,464 1,552,743 Average deposits 1,421,055 1,407,586 1,363,064 1,343,273 1,275,599 Average total equity $146,660 $143,196 $141,264 $138,727 $133,628 *T