TFIN Triumph Financial Inc

PAOLA, Kansas, Nov. 1 /PRNewswire-FirstCall/ -- Team Financial, Inc. (the Company) (NASDAQ:TFIN) today announced net income of $908,000, or $0.25 basic and diluted income per share, for the three months ended September 30, 2007, an increase of 20.3%, compared to $755,000 or $0.21 basic and $0.20 diluted income per share, for the three months ended September 30, 2006. Net income for the nine months ended September 30, 2007 was $3,487,000, or $0.97 basic and $0.95 diluted income per share, compared to $2,573,000, or $0.67 basic and $0.66 diluted income per share for the nine months ended September 30, 2006, an increase of 35.5%. Net interest income for the three months ended September 30, 2007 increased approximately $278,000, or 4.6%, from the same period last year. The increase is primarily due to the increase in loan balances as the net interest margin decreased by eight basis points to 3.69% during the three months ended September 30, 2007 from 3.77% during the same period last year. The net interest margin decreased 12 basis points during the third quarter 2007 from 3.81 during the second quarter 2007. Non-interest income increased approximately $140,000, or 7.9%, primarily due to a $74,000 loss on sales of investment securities that was incurred during the second quarter of 2006 as a result of restructuring the investment portfolio. Also contributing to the increase in non-interest income was a $20,000, or 16.0%, increase in gain on sales of mortgage loans and a $22,000, or 10%, increase in bank owned life insurance income. Non-interest expenses increased $275,000, or 4.1%, for the three months ended September 30, 2007 compared to the same period in 2006 primarily due to increases in salaries and employee benefits expense, occupancy and equipment expenses, and professional fees. During the third quarter of 2007, the Company recorded unique expenses related to the compliance with the provisions of the Sarbanes-Oxley Act of 2002, the reassessment of the useful lives of fixed assets, and procedural losses totaling approximately $339,000, or approximately $0.06 per share. These increases were offset by a reduction in other non-interest expenses as a result of an $823,000 charge recorded during the third quarter of 2006 related to the restructuring of the trust preferred securities. Loans receivable increased approximately $29.6 million, or 6.1%, to $516.1 million at September 30, 2007 compared to $486.5 million at December 31, 2006. This increase was primarily a result of an increase in construction and land development loans. The provision for loan losses was $91,000 for the three months ended September 30, 2007 compared to $131,000 for the same period ended September 30, 2006. The allowance for loan losses as a percent of loans receivable was 1.13% at September 30, 2007 and 1.17% at December 31, 2006, and non-performing loans were 1.58% of loans receivable at September 30, 2007 and 1.92% of loans receivable at December 31, 2006. "Our third quarter results reflect the challenging operating environment that faces domestic banks. We incurred additional expenses in order to comply with the provisions of the Sarbanes-Oxley Act and loan growth and margin are more of a challenge," said Robert J. Weatherbie, Chairman and Chief Executive Officer of Team Financial, Inc. "We are continuing our growth strategies in order to position ourselves for the future. We opened a new branch in Lee's Summit, Missouri in August, and we plan to open another branch in Olathe, Kansas in early-December. We have already seen impressive loan growth in the Lee's Summit location, and we have the same expectations for the Olathe location as well." Team Financial, Inc. is a financial services company with $777 million in total assets. It operates in the Kansas City metropolitan area, southeastern Kansas, western Missouri, the Omaha, Nebraska metropolitan area, and in the Colorado Springs, Colorado metropolitan area. The Company offers a full range of consumer and corporate banking services, including small business loans, mortgage loans, trust services, and investment and brokerage services. For additional information on Team Financial, Inc., visit its Web site at http://www.teamfinancialinc.com/ or call 913-294-9667. Note: 2006 data has been adjusted to reflect the adoption and application of Staff Accounting Bulletin No. 108 ("SAB 108"). The adoption of SAB 108 resulted in a $29,000 and $88,000 decrease to the net income for the three and nine months ending September 30, 2006, or $.01 basic and diluted income per share decrease for the three months ending September 30, 2006 and $.02 basic and diluted income per share decrease for the nine months ended September 30, 2006. This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995 that are subject to certain risks and uncertainties that could cause actual results to differ materially from historical income and those presently anticipated or projected. The Company cautions readers not to place undue reliance on any such forward looking statements, which speak only as of the date of this release. Such risks and uncertainties include those detailed in the Company's filings with the Securities and Exchange Commission, risks of adversely changing results of operations, risks related to the Company's expansion strategies, risks relating to loans and investments, including the effect of the change of the local economic conditions, risks associated with the adverse effects of the changes in interest rates, and competition for the Company's customers by other providers of financial services, all of which are difficult to predict and many of which are beyond the control of the Company. TEAM FINANCIAL, INC. AND SUBSIDIARIES Unaudited Consolidated Statements of Financial Condition (In thousands) September 30, December 31, Assets 2007 2006 Cash and due from banks $14,673 $14,529 Federal funds sold and interest bearing bank deposits 6,426 22,621 Cash and cash equivalents 21,099 37,150 Investment securities: Available for sale, at fair value (amortized cost of $173,224 and $171,301 at September 30, 2007 and December 31, 2006, respectively) 171,906 170,079 Non-marketable equity securities (amortized cost of $9,387 and $9,061 at September 30, 2007 and December 31, 2006, respectively) 9,387 9,061 Total investment securities 181,293 179,140 Loans receivable, net of unearned fees 516,101 486,497 Allowance for loan losses (5,855) (5,715) Net loans receivable 510,246 480,782 Accrued interest receivable 5,965 5,558 Premises and equipment, net 21,722 17,628 Assets acquired through foreclosure 915 817 Goodwill 10,700 10,700 Intangible assets, net of accumulated amortization 2,672 2,659 Bank-owned life insurance policies 20,532 19,926 Other assets 2,218 2,068 Total assets $777,362 $756,428 Liabilities and Stockholder's Equity Deposits: Checking deposits $168,818 $194,979 Savings deposits 26,562 28,536 Money market deposits 70,835 57,123 Certificates of deposit 316,995 282,244 Total deposits 583,210 562,882 Federal funds purchased and securities sold under agreements to repurchase 3,588 6,215 Federal Home Loan Bank advances 108,026 108,069 Notes payable 200 200 Subordinated debentures 22,681 22,681 Accrued expenses and other liabilities 7,148 5,864 Total liabilities 724,853 705,911 Stockholders' Equity: Preferred stock, no par value, 10,000,000 shares authorized; no shares issued - - Common stock, no par value, 50,000,000 shares authorized; 4,502,791 and 4,501,516 shares issued; 3,600,064 and 3,594,784 shares outstanding at September 30, 2007 and December 31, 2006, respectively 27,916 27,901 Capital surplus 272 680 Retained earnings 36,785 34,449 Treasury stock, 902,727 and 906,732 shares of common stock at cost at September 30, 2007, and December 31, 2006, respectively (11,594) (11,707) Accumulated other comprehensive loss (870) (806) Total stockholders' equity 52,509 50,517 Total liabilities and stockholders' equity $777,362 $756,428 TEAM FINANCIAL, INC. AND SUBSIDIARIES Unaudited Consolidated Statements of Operations (Dollars in thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, 2007 2006 2007 2006 Interest Income: Interest and fees on loans $10,384 $9,266 $30,597 $25,878 Taxable investment securities 2,015 2,015 6,007 5,829 Nontaxable investment securities 326 256 906 796 Other 190 115 570 422 Total interest income 12,915 11,652 38,080 32,925 Interest Expense: Deposits: Checking deposits 435 460 1,488 1,399 Savings deposits 47 57 149 163 Money market deposits 628 417 1,662 994 Certificates of deposit 3,874 3,010 11,098 7,815 Federal funds purchased and securities sold under agreements to repurchase 39 36 128 124 FHLB advances payable 1,175 1,139 3,414 3,402 Notes payable and other borrowings 5 94 12 137 Subordinated debentures 406 411 1,210 1,188 Total interest expense 6,609 5,624 19,161 15,222 Net interest income before provision for loan losses 6,306 6,028 18,919 17,703 Provision for loan losses 91 131 398 563 Net interest income after provision for loan losses 6,215 5,897 18,521 17,140 Non-Interest Income: Service charges 950 951 2,675 2,702 Trust fees 184 173 602 555 Gain on sales of mortgage loans 145 125 444 455 Loss on sales of investment securities (5) (74) (4) (164) Bank-owned life insurance income 242 220 717 650 Other 391 372 1,141 1,090 Total non-interest income 1,907 1,767 5,575 5,288 Non-Interest Expenses: Salaries and employee benefits 3,441 2,985 9,638 9,238 Occupancy and equipment 947 735 2,524 2,231 Data processing 783 749 2,305 2,170 Professional fees 435 250 1,107 1,100 Marketing 167 109 446 284 Supplies 104 63 296 249 Intangible asset amortization 156 141 422 436 Trust Preferred Securities redemption amortization - 823 - 823 Other 955 858 2,670 2,519 Total non-interest expenses 6,988 6,713 19,408 19,050 Income before income taxes 1,134 951 4,688 3,378 Income tax expense 226 196 1,201 805 Net income $908 $755 $3,487 $2,573 Basic income per share $0.25 $0.21 $0.97 $0.67 Diluted income per share $0.25 $0.20 $0.95 $0.66 Shares applicable to basic income per share 3,616,515 3,594,401 3,609,033 3,821,758 Shares applicable to diluted income per share 3,695,337 3,692,392 3,682,588 3,912,655 Team Financial, Inc. And Subsidiaries Unaudited Selected Ratios and Other Data As of and For As of and For Three Months Ended Nine Months Ended September 30 September 30 Selected Data 2007 2006(c) 2007 2006(c) Balance Sheet Highlights Average Assets $772,631 $720,275 $765,753 $712,246 Average Loans $504,462 $460,049 $500,700 $450,516 Non Performing Loans $8,158 $8,563 $8,158 $8,563 Performance Ratios Return On Average Assets 0.47% 0.42% 0.61% 0.48% Return On Average Equity 6.93% 6.32% 9.06% 6.82% Average Equity To Average Assets 6.73% 6.58% 6.72% 7.08% Net Interest Margin On Average Earning Assets During The Period (Tax Equivalent) 3.69% 3.77% 3.76% 3.77% Efficiency Ratio(a) 85.08% 86.12% 79.24% 82.86% Book Value Per Share $14.59 $13.42 Tangible Book Value Per Share(b) $10.95 $9.77 Asset Quality Ratios Non Performing Loans As A Percent Of Total Loans 1.58% 1.83% Non Performing Assets As A Percent Of Total Assets 1.17% 1.32% Allowance For Loan Losses As A Percent Of Total Loans 1.13% 1.23% Allowance For Loan Losses As A Percent Of Non Performing Loans 71.77% 67.37% (a) Calculated as non-interest expense/(net interest income plus non-interest income) (b) Calculated as (stockholders equity less goodwill, less intangible assets, net of accumulated amortization plus mortgage servicing rights) divided by shares outstanding. (c) 2006 data has been adjusted to reflect the adoption and application of Staff Accounting Bulletin No. 108 DATASOURCE: Team Financial, Inc. CONTACT: Rick J. Tremblay, Chief Financial Officer of Team Financial, Inc., +1-913-294-9667, Web site: http://www.teamfinancialinc.com/

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