TCBK TriCo Bancshares

TriCo Bancshares (NASDAQ: TCBK), parent company of Tri Counties Bank, today announced record annual earnings of $26,830,000 for the year ended December 31, 2006. This represents a 13.4% increase when compared with earnings of $23,671,000 for the year ended December 31, 2005. Diluted earnings per share for the year ended December 31, 2006 increased 13.1% to $1.64 from $1.45 for the year ended December 31, 2005. Total assets of the Company increased $79 million (4.3%) to $1.920 billion at December 31, 2006 versus $1.841 billion at December 31, 2005. Total loans of the Company increased $125 million (9.0%) to $1.510 billion at December 31, 2006 versus $1.385 billion at December 31, 2005. Total deposits of the Company increased $102 million (6.8%) to $1.599 billion at December 31, 2006 versus $1.497 billion at December 31, 2005. Net income for the quarter ended December 31, 2006 increased 2.7% to $6,918,000 from $6,734,000 in the quarter ended December 31, 2005. Diluted earnings per share increased 2.4% to $0.42 in the quarter ended December 31, 2006 from $0.41 in the quarter ended December 31, 2005. The increase in earnings for the quarter ended December 31, 2006 over the year-ago quarter was due to a $948,000 (4.6%) increase in net interest income to $21,724,000, and a $561,000 (100%) decrease in provision for loan losses to $0, which were partially offset by a $1,202,000 (7.6%) increase in noninterest expense to $17,002,000 from the year-ago quarter. Noninterest income for the quarter ended December 31, 2006 increased $5,000 (0.1%) to $6,627,000 from the year-ago quarter. The increase in net interest income was due to the loan growth noted above, which was partially offset by a decrease in fully tax-equivalent net interest margin to 5.13% during the quarter ended December 31, 2006 versus 5.21% during the quarter ended December 31, 2005. The fully tax-equivalent net interest margin was 5.19% during the quarter ended September 30, 2006. The $561,000 decrease in provision for loan loss from the quarter ended December 31, 2006 was mainly due to slower growth in loan balances during the quarter ended December 31, 2006 as credit quality of the loan portfolio remained high. Net loan charge-offs during the quarter ended December 31, 2006 were $79,000 compared to $131,000 in the year-ago quarter. Nonperforming loans, net of government agency guarantees, were $4,512,000 at December 31, 2006 compared to $2,961,000 at December 31, 2005. The Company�s allowance for losses, which consists of the allowance for loan losses and the reserve for unfunded commitments, was $18,763,000 or 1.24% of total loans outstanding and 416% of nonperforming loans at December 31, 2006 compared to $18,039,000 or 1.30% of total loans outstanding and 609% of nonperforming loans at December 31, 2005. The $1,202,000 increase in noninterest expense during the quarter ended December 31, 2006 was mainly due to an $840,000 (9.8%) increase in salaries and benefits expense to $9,405,000 and a $497,000 (7.4%) increase in other noninterest expenses to $7,247,000. The increases in salaries and benefits expense was primarily the result of regular salary increases, the opening of branches in Roseville, Yuba City, Folsom, Antelope, Anderson, and Elk Grove in November 2005, January 2006, March 2006, May 2006, June 2006 and August 2006, respectively, and $110,000 of employee stock option expense. The increase in other noninterest expense was primarily due to inflation and the effect of the new branches noted above. The increase in noninterest income was primarily due to a $150,000 (3.1%) increase in service charges and fees to $4,940,000 during the quarter ended December 31, 2006 from the quarter ended December 31, 2005. Other noninterest income decreased $145,000 (7.9%) to $1,687,000 due mainly to a $77,000 increase in income from cash value of life insurance to $544,000, offset by a $135,000 decrease in gain on sale of loans to $349,000 and a $98,000 decrease in commission on sale of nondeposit investment products to $417,000. As of December 31, 2006, the Company had purchased 374,371 shares of its common stock under its stock repurchase plan announced on July 31, 2003 and amended on April 9, 2004, which leaves 125,629 shares available for repurchase under the plan. Richard Smith, President and Chief Executive Officer, commented, �When we consider the fierce competition that currently exists for deposits, the fact that the current spread between short-term interest rates and long-term interest rates makes it harder for banks to be profitable, and the slowdown in real estate activity, we get a greater appreciation for the effort our team members put forth to achieve these record quarterly and annual results. We continue to believe these results reflect our ability to deliver, and our market�s acceptance of, our values of service and convenience." 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 31-year history in the banking industry. Tri Counties Bank operates 32 traditional branch locations and 22 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 62 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. TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA (Unaudited. Dollars in thousands, except share data) � Three months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, 2006� 2006� 2006� 2006� 2005� Statement of Income Data Interest income $31,545� $31,421� $29,379� $27,978� $26,876� Interest expense 9,821� 9,576� 8,275� 6,773� 6,100� Net interest income 21,724� 21,845� 21,104� 21,205� 20,776� Provision for loan losses -� 235� 554� 500� 561� Noninterest income: Service charges and fees 4,940� 5,056� 4,956� 4,857� 4,790� Other income 1,687� 1,593� 1,575� 1,591� 1,832� Total noninterest income 6,627� 6,649� 6,531� 6,448� 6,622� Noninterest expense: Salaries and benefits 9,405� 9,276� 8,618� 9,156� 8,565� Intangible amortization 350� 350� 350� 346� 346� Provision for losses - unfunded commitments -� -� 36� -� 139� Other expense 7,247� 7,400� 7,272� 6,920� 6,750� Total noninterest expense 17,002� 17,026� 16,276� 16,422� 15,800� Income before taxes 11,349� 11,233� 10,805� 10,731� 11,037� Net income $6,918� $6,820� $6,557� $6,535� $6,734� Share Data Basic earnings per share $0.44� $0.43� $0.42� $0.42� $0.43� Diluted earnings per share 0.42� 0.42� 0.40� 0.40� 0.41� Book value per common share 10.69� 10.41� 9.96� 9.68� 9.52� Tangible book value per common share $9.60� $9.22� $8.75� $8.44� $8.25� Shares outstanding 15,857,207� 15,857,107� 15,855,107� 15,778,090� 15,707,835� Weighted averageshares 15,857,166� 15,855,933� 15,798,565� 15,736,544� 15,711,257� Weighted average dilutedshares 16,396,320� 16,365,858� 16,388,855� 16,379,595� 16,336,888� Credit Quality Non-performing loans, net of government agency guarantees $4,512� $4,523� $3,913� $4,048� $2,961� Other real estate owned -� -� -� -� -� Loans charged-off 498� 368� 564� 357� 392� Loans recovered $419� $233� $259� $275� $261� Allowance for losses to total loans(1) 1.24% 1.25% 1.29% 1.32% 1.30% Allowance for losses to NPLs(1) 416% 417% 479% 456% 609% Allowance for losses to NPAs(1) 416% 417% 479% 456% 609% Selected Financial Ratios Return on average total assets 1.46% 1.45% 1.42% 1.43% 1.51% Return on average equity 16.23% 16.64% 16.68% 16.93% 18.00% Average yield on loans 7.81% 7.82% 7.44% 7.24% 7.11% Average yield on interest-earning assets 7.43% 7.44% 7.07% 6.86% 6.72% Average rate on interest-bearing liabilities 2.97% 2.86% 2.50% 2.11% 1.94% Net interest margin (fully tax-equivalent) 5.13% 5.19% 5.10% 5.21% 5.21% Total risk based capital ratio 11.3% 11.1% 11.1% 11.1% 10.8% Tier 1 Capital ratio 10.3% 10.1% 10.1% 10.0% 9.8% (1) Allowance for losses includes allowance for loan losses and reserve for unfunded commitments. TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA (Unaudited. Dollars in thousands) � Three months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, 2006� 2006� 2006� 2006� 2005� Balance Sheet Data Cash and due from banks $102,220� $78,281� $84,663� $78,742� $90,562� Federal funds sold 794� 1,387� 526� -� 2,377� Securities, available-for-sale 198,361� 209,886� 221,828� 244,441� 260,278� Federal Home Loan Bank Stock 8,320� 8,206� 8,103� 7,691� 7,602� Loans Commercial loans 153,105� 153,705� 146,952� 134,049� 143,175� Consumer loans 525,513� 527,185� 517,588� 510,809� 508,233� Real estate mortgage loans 679,661� 661,962� 642,422� 630,821� 623,511� Real estate construction loans 151,600� 164,307� 149,046� 124,429� 110,116� Total loans, gross 1,509,879� 1,507,159� 1,456,008� 1,400,108� 1,385,035� Allowance for loan losses (16,914) (16,993) (16,893) (16,644) (16,226) Premises and equipment 21,830� 21,556� 21,597� 21,068� 21,291� Cash value of life insurance 43,536� 42,991� 42,571� 42,168� 41,768� Goodwill 15,519� 15,519� 15,519� 15,519� 15,519� Intangible assets 1,666� 3,361� 3,711� 4,061� 4,407� Other assets 34,755� 32,651� 33,523� 32,372� 28,662� Total assets 1,919,966� 1,904,004� 1,871,156� 1,829,526� 1,841,275� Deposits Noninterest-bearing demand deposits 420,025� 357,754� 354,576� 354,514� 368,412� Interest-bearing demand deposits 230,671� 229,143� 235,100� 249,064� 244,193� Savings deposits 374,605� 369,933� 388,847� 432,087� 438,177� Time certificates 573,848� 568,344� 535,917� 491,726� 446,015� Total deposits 1,599,149� 1,525,174� 1,514,440� 1,527,391� 1,496,797� Federal funds purchased 38,000� 106,500� 96,700� 45,800� 96,800� Reserve for unfunded commitments 1,849� 1,849� 1,849� 1,813� 1,813� Other liabilities 30,383� 28,254� 24,964� 29,046� 23,744� Other borrowings 39,911� 35,848� 33,971� 31,441� 31,390� Junior subordinated debt 41,238� 41,238� 41,238� 41,238� 41,238� Total liabilities 1,750,530� 1,738,863� 1,713,162� 1,676,729� 1,691,782� Total shareholders' equity 169,436� 165,141� 157,994� 152,797� 149,493� Accumulated other comprehensive loss (4,521) (3,607) (5,629) (5,330) (3,825) Average loans 1,498,040� 1,477,551� 1,427,735� 1,384,541� 1,344,654� Average interest-earning assets 1,711,743� 1,701,166� 1,676,705� 1,646,777� 1,615,901� Average totalassets 1,890,765� 1,880,029� 1,850,487� 1,822,441� 1,784,018� Average deposits 1,550,979� 1,501,630� 1,497,571� 1,498,825� 1,473,625� Average totalequity $170,518� $163,919� $157,232� $154,410� $149,619�