FRESNO, Calif., July 23, 2012 /PRNewswire/ -- United Security
Bancshares (http://www.unitedsecuritybank.com/) (Nasdaq Global
Select: UBFO) reported today unaudited consolidated net income of
$2,173,000 or $0.16 per basic and diluted common share for the
quarter ended June 30, 2012 and
$3,224,000 or $.23 per basic and diluted common share for the
six months ended June 30, 2012, as
compared to a net loss of $6.3
million or ($0.46) per basic
and diluted common shares for the quarter ended June 30, 2011 and a net loss of $6.0 million or ($.43) per basic and diluted shares for the six
months ended June 30, 2011.
Annualized return on average equity (ROAE) for the quarter ended
June, 2012 was 13.83%, compared to (31.64%) for the same period in
2011, and was 10.23% for the six months ended June 30, 2012 compared to (15.63)% for the six
months ended June 30, 2011.
Annualized return on average assets (ROAA) was 1.44% for the three
months ended June 30, 2012 compared
to (3.85%) for the same three-month period in 2011, and was 1.06%
for the six months ended June 30,
2012 compared to (1.83%) for the six months ended
June 30, 2011.
The Board of Directors of United Security Bancshares declared a
second quarter 2012 stock dividend of one percent (1%) on
June 26, 2012. The stock dividend was
payable to shareholders of record on July
13, 2012, and the shares will be issued on July 25, 2012.
Dennis R. Woods, President and
Chief Executive Officer of the Company, remarks "The
direction of our earnings has clearly changed and is a result of
the continued reduction of problem assets since 2011 and
stabilization in the real estate market." Shareholders'
equity at June 30, 2012 was
$65.8 million, up $3.6 million from shareholders' equity of
$62.2 million at December 31, 2011.
Net interest income before provision for credit losses for the
quarter ended June 30, 2012 totaled
$6.0 million and $12.0 million for the six months ended
June 30, 2012, down just $310,000 from $6.3
million reported for the quarter ended June 30, 2011 and down $450,000 from the 12.5 million reported for the
six months ended June 30, 2011,
respectively. The net interest margin was 4.71% for the quarter
ended June 30, 2012, and 4.69% for
the six months ended June 30, 2012,
as compared to 4.52% for the quarter ended June 30, 2011 and 4.47% for the six months ended
June 30, 2011. The Company continues
to benefit from decreasing costs on interest-bearing
liabilities.
Noninterest income for the quarter ended June 30, 2012 totaled $3.7
million, reflecting an increase of $2.5 million from $1.2
million in noninterest income reported for the quarter ended
June 30, 2011. Noninterest income for
the six months ended June 30, 2012
totaled $4.6 million, reflecting an
increase of $2.2 million from
$2.3 million in noninterest income
reported for the six months ended June 30,
2011. Customer service fees continue to provide the majority
of the Company's noninterest income, totaling $897,000 for the quarter ended June 30, 2012, as compared to $894,000 for the quarter ended June 30, 2011, and $1.8
million for the six months ended June
30, 2012 and 2011. Changes in noninterest income on a
quarter-to-quarter comparative basis between the second quarters of
2012 and 2011 are largely the result of an increase of $1.8 million on gains realized on the sale of
investments and an increase of $598,000 on gains realized on the sale of other
real estate owned. On a six month comparative basis, changes
in noninterest income again were the result of an increase of
$1.8 million on gains realized on the
sale of investments and an increase of $381,000 on gains realized on the sale of other
real estate owned.
Noninterest expense totaled $5.0
million for the quarter ended June
30, 2012, down $3.3 million
from $8.2 million reported for the
quarter ended June 30, 2011. For the
six months ended June 30, 2012,
noninterest expense totaled $10.5
million as down $3.8 million
from the $14.3 million for the six
months ended June 30, 2011. Between
the second quarters of 2012 and 2011, the company experienced
significant decreases in impairment losses on goodwill, impairment
losses on other real estate owned, other real estate owned
expenses, and professional fees. On a six month comparative basis,
additional decreases in the above listed areas as well as decreases
in regulatory assessments and occupancy expenses contributed to the
overall decrease.
The Company had a provision for loan loss reserve of
$1.0 million for the quarter ended
June 30, 2012 and the six months
ended June 30, 2012, compared to
$9.2 million for the quarter ended
June 30, 2011 and $10.1 million for the six months ended
June 30, 2011. Net loan charge-offs
totaled $2.4 million for the quarter
ended June 30, 2012 and $3.0 million for the six months ended
June 30, 2012 as compared to
$12.0 million for the quarter ended
June 30, 2011, and $12.7 million for the six months ended
June 30, 2011. With continued
weakness in the economy and real estate markets within our service
area, we have maintained an adequate allowance for loan losses
which totaled 2.94% of total loans at June
30, 2012 compared to 3.28% of total loans at March 31, 2012 and 3.29% at June 30, 2011. In determining the adequacy of the
allowance for loan losses, Management's judgment is the primary
determining factor for establishing the amount of the provision for
loan losses and management considers the allowance for loan and
lease losses June 30, 2012 to be
adequate.
Non-performing assets, comprised of nonaccrual loans, troubled
debt restructures (TDR), other real estate owned through
foreclosure (OREO), and loans more than 90 days past days and still
accruing interest, decreased approximately $4.7 million between December 31, 2011 and June
30, 2012. Additionally, nonperforming assets as a percentage
of total assets decreased from 8.84% at December 31, 2011 to 8.76% at June 30, 2012. Nonaccrual loans decreased
$1.2 million between December 31, 2011 and June
30, 2012, while OREO, decreased $3.2
million during the same period. Impaired loans totaled
$28.4 million at June 30, 2012, down $3.5
million from the balance of $31.9
million at December 31,
2011.
United Security Bancshares is a $600+ million bank holding
company. United Security Bank, its principal subsidiary is a state
chartered bank and member of the Federal Reserve Bank of
San Francisco.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended
and the Company intends such statements to be covered by the safe
harbor provisions for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on management's knowledge
and belief as of today and include information concerning the
Company's possible or assumed future financial condition, and its
results of operations, business and earnings outlook. These
forward-looking statements are subject to risks and uncertainties.
A number of factors, some of which are beyond the Company's ability
to control or predict, could cause future results to differ
materially from those contemplated by such forward-looking
statements. These factors include (1) changes in interest rates,
(2) significant changes in banking laws or regulations, (3)
increased competition in the company's market, (4)
other-than-expected credit losses, (5) earthquake or other natural
disasters impacting the condition of real estate collateral, (6)
the effect of acquisitions and integration of acquired businesses,
(7) the impact of proposed and/or recently adopted changes in laws,
and regulations on the Company and its business; (8) changing bank
regulatory conditions, policies, whether arising as new legislation
or regulatory initiatives or changes in our regulatory
classifications, that could lead to restrictions on activities of
banks generally or as to the Bank, including specifically the
formal order between the Federal Reserve Bank of San Francisco and the Company and the Bank,
(9) failure to comply with the regulatory agreement under which the
Company is subject and (10) unknown economic impacts caused by the
State of California's budget
issues. Management cannot predict at this time the severity or
duration of the effects of the recent business slowdown on our
specific business activities and profitability. Weaker or a further
decline in capital and consumer spending, and related recessionary
trends could adversely affect our performance in a number of ways
including decreased demand for our products and services and
increased credit losses. Likewise, changes in interest rates, among
other things, could slow the rate of growth or put pressure on
current deposit levels and affect the ability of borrowers to repay
loans. Forward-looking statements speak only as of the date they
are made, and the company does not undertake to update
forward-looking statements to reflect circumstances or events that
occur after the date the statements are made, or to update earnings
guidance including the factors that influence earnings. For a more
complete discussion of these risks and uncertainties, see the
Company's Annual Report on Form 10-K for the year ended
December 31, 2011, and particularly
the section of Management's Discussion and Analysis. Readers
should carefully review all disclosures we file from time to time
with the Securities and Exchange Commission ("SEC").
United
Security Bancshares
|
|
|
|
Consolidated Balance Sheets
|
|
|
|
(dollars in thousands)
|
|
|
|
|
June
30,
|
|
December
31,
|
|
2012
|
|
2011
|
Assets
|
|
|
|
Cash and noninterest-bearing deposits in
other banks
|
$22,400
|
|
$28,052
|
Cash and due from Federal Reserve
Bank
|
76,990
|
|
96,132
|
Federal funds sold
|
0
|
|
0
|
Cash and cash
equivalents
|
99,390
|
|
124,184
|
Interest-bearing deposits in other
banks
|
2,103
|
|
2,187
|
Investment securities (AFS at market value)
|
35,553
|
|
38,458
|
Loans and leases, net of unearned
fees
|
394,563
|
|
408,146
|
Less: Allowance for credit
losses
|
(11,610)
|
|
(13,648)
|
Net loans
|
382,953
|
|
394,498
|
Premises and equipment - net
|
12,566
|
|
12,675
|
Bank owned life insurance
|
16,413
|
|
16,150
|
Intangible assets
|
4,871
|
|
5,041
|
Other real estate owned
|
23,894
|
|
27,091
|
Deferred Income Taxes
|
11,154
|
|
11,485
|
Other assets
|
16,710
|
|
19,563
|
Total
assets
|
$605,607
|
|
$651,332
|
Deposits:
|
|
|
|
Noninterest bearing demand
and NOW
|
$197,052
|
|
$224,907
|
Money market and
savings
|
213,204
|
|
206,036
|
Time
|
114,746
|
|
143,484
|
Total
deposits
|
525,002
|
|
574,427
|
Borrowed funds
|
0
|
|
0
|
Other liabilities
|
5,512
|
|
5,705
|
Junior subordinated debentures (at fair
value)
|
9,276
|
|
9,027
|
Total
liabilities
|
539,790
|
|
589,159
|
Shareholders' equity:
|
|
|
|
Common shares outstanding:
|
|
|
|
13,133,871 at March
31, 2012
|
|
|
|
13,531,832 at December
31, 2011
|
42,087
|
|
41,435
|
Retained earnings
|
24,029
|
|
21,447
|
Accumulated other comprehensive
loss
|
(299)
|
|
(709)
|
Total
shareholders' equity
|
65,817
|
|
62,173
|
Total
liabilities and shareholders' equity
|
$605,607
|
|
$651,332
|
|
|
|
|
|
United
Security Bancshares
|
|
|
|
|
(dollars in 000s, except per share
amounts)
|
|
|
|
|
|
Three
Months Ended
|
Three
Months Ended
|
Six Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
June
30,
|
June
30,
|
|
2012
|
2011
|
2012
|
2011
|
Interest
income:
|
|
|
|
|
Interest and fees on loans
|
$5,966
|
$6,437
|
$12,009
|
$12,857
|
Interest on investment
securities
|
457
|
540
|
978
|
1,137
|
Interest on deposits in FRB
|
43
|
43
|
94
|
94
|
Interest on deposits in other
banks
|
10
|
10
|
20
|
20
|
Total interest
income
|
6,476
|
7,030
|
13,101
|
14,108
|
Interest
expense:
|
|
|
|
|
Interest on deposits
|
437
|
668
|
915
|
1,436
|
Interest on other borrowed
funds
|
72
|
83
|
138
|
168
|
Total interest
expense
|
509
|
751
|
1,053
|
1,6042
|
Net
interest income before provision for credit losses
|
5,967
|
6,279
|
12,048
|
12,504
|
Provision for credit losses
|
1,004
|
9,161
|
1,006
|
10,051
|
Net
interest income
|
4,963
|
(2,882)
|
11,042
|
2,453
|
Noninterest income:
|
|
|
|
|
Customer service fees
|
897
|
894
|
1,797
|
1,761
|
Increase in cash surrender value
of
|
|
|
|
|
bank owned life
insurance
|
144
|
140
|
280
|
281
|
Gain
(Loss) on sale of other real estate owned
|
275
|
(324)
|
337
|
(44)
|
Gain
(loss) on Fair Value Option of Financial Assets
|
364
|
222
|
(112)
|
(145)
|
Other noninterest income
|
1,984
|
242
|
2,256
|
449
|
Total
noninterest income
|
3,664
|
1,174
|
4,558
|
2,302
|
Noninterest expense:
|
|
|
|
|
Salaries and employee benefits
|
2,176
|
2,220
|
4,598
|
4,541
|
Occupancy expense
|
840
|
909
|
1,605
|
1,802
|
Professional fees
|
439
|
980
|
683
|
1,419
|
Regulatory insurance assessments
|
417
|
475
|
783
|
988
|
Impairment losses and other expenses on OREO
|
(18)
|
1,157
|
666
|
2,073
|
Impairment losses on goodwill and intangible assets
|
0
|
1,489
|
0
|
1,525
|
Impairment losses on investment securities
|
149
|
0
|
172
|
0
|
Other noninterest expense
|
974
|
1,010
|
1,957
|
1,949
|
Total
noninterest expense
|
4,977
|
8,240
|
10,464
|
14,297
|
Income
before income tax provision
|
3,650
|
(9,948)
|
5,136
|
(9,542)
|
Provision
(benefit) for income taxes
|
1,478
|
(3,599)
|
1,912
|
(3,549)
|
Net
Income
|
$2,173
|
($6,349)
|
3,224
|
(5,993)
|
|
|
|
|
|
United
Security Bancshares
|
|
|
|
|
Selected Financial Data (Quarters
Unaudited)
|
|
|
|
|
(dollars in 000s, except per share
amounts)
|
|
|
|
|
|
Three
months Ended
|
Three
months Ended
|
Six Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
June
30,
|
June
30,
|
|
2012
|
2011
|
2012
|
2011
|
Basic
earnings per share
|
$0.16
|
($0.46)
|
$0.23
|
($0.43)
|
Diluted
earnings per share
|
$0.16
|
($0.46)
|
$0.23
|
($0.43)
|
Weighted
average basic shares for EPS
|
13,803,824
|
13,803,824
|
13,803,824
|
13,803,824
|
Weighted
average diluted shares for EPS
|
13,803,824
|
13,803,824
|
13,803,824
|
13,803,824
|
|
|
|
|
|
Annualized
return on:
|
|
|
|
|
Average assets
|
1.42%
|
(3.82%)
|
1.05%
|
(1.81%)
|
Average equity
|
13.40%
|
(31.64%)
|
10.23%
|
(15.63%)
|
Yield on
interest-earning assets
|
5.11%
|
5.06%
|
5.10%
|
5.04%
|
Cost of
interest-bearing liabilities
|
0.61%
|
0.74%
|
.63%
|
.77%
|
Net
interest margin
|
4.71%
|
4.52%
|
4.69%
|
4.47%
|
Annualized
net charge-offs to average loans
|
2.44%
|
10.99%
|
1.54%
|
5.89%
|
|
|
|
|
|
|
June
30,
|
June
30,
|
|
|
|
2012
|
2011
|
|
|
Shares
outstanding - period end
|
13,803,824
|
13,803,824
|
|
|
Book value
per share
|
$4.77
|
$4.50
|
|
|
Tangible
book value per share
|
$4.42
|
$4.14
|
|
|
Efficiency
ratio
|
51.67%
|
110.56%
|
|
|
Total
nonperforming assets
|
$53,023
|
$76,705
|
|
|
Nonperforming assets to total assets
|
8.76%
|
11.64%
|
|
|
Total
Impaired loans
|
$28,375
|
$36,953
|
|
|
Total
nonaccrual loans
|
$18,189
|
$20,792
|
|
|
Allowance
for loan losses to total loans
|
2.94%
|
3.29%
|
|
|
SOURCE United Security Bancshares