FRESNO, Calif., Oct. 16, 2012 /PRNewswire/ -- United
Security Bancshares (http://www.unitedsecuritybank.com) (Nasdaq
Global Select: UBFO) reported today unaudited consolidated net
income of $1.4 million or
$0.10 per basic and diluted common
share for the quarter ended September 30,
2012 and $4.6 million or
$.33 per basic and diluted common
share for the nine months ended September
30, 2012, as compared to a net loss of $1.5 million or ($0.10) per basic and diluted common shares for
the quarter ended September 30, 2011
and a net loss of $7.5 million or
($.53) per basic and diluted shares
for the nine months ended September 30,
2011.
Annualized return on average equity (ROAE) for the quarter ended
September 30, 2012 was 8.72%,
compared to (29.58%) for the same period in 2011, and was 9.82% for
the nine months ended September 30,
2012 compared to (13.68)% for the nine months ended
September 30, 2011. Annualized return
on average assets (ROAA) was .87% for the three months ended
September 30, 2012 compared to
(2.98%) for the same three-month period in 2011, and was 0.99% for
the nine months ended September 30,
2012 compared to (1.50%) for the nine months ended
September 30, 2011.
The Board of Directors of United Security Bancshares declared a
third quarter 2012 stock dividend of one percent (1%) on
September 26, 2012. The stock
dividend was payable to shareholders of record on October 12, 2012, and the shares will be issued
on October 24, 2012.
Dennis R. Woods, President and
Chief Executive Officer of the Company, states, "We continue to see
positive trends that are in alignment with the continued
improvement in the weak economy and depressed real estate
values." Shareholders' equity at September 30, 2012 was $67.7 million, up $5.0
million from shareholders' equity of $62.2 million at December
31, 2011.
Net interest income before provision for credit losses for the
quarter ended September 30, 2012
totaled $5.6 million and $17.7 million for the nine months ended
September 30, 2012, down just
$618,000 from $6.2 million reported for the quarter ended
September 30, 2011 and down
$1.1 million from the $18.7 million reported for the nine months ended
September 30, 2011, respectively. The
net interest margin was 4.23% for the quarter ended September 30, 2012, and 4.53% for the nine months
ended September 30, 2012, as compared
to 4.42% for the quarter ended September 30,
2011 and 4.45% for the nine months ended September 30, 2011. The Company continues to
benefit from decreasing costs on interest-bearing liabilities.
Noninterest income for the quarter ended September 30, 2012 totaled $1.1 million, reflecting a decrease of
$2.2 million from the $3.3 million in noninterest income reported for
the quarter ended September 30, 2011.
Noninterest income for the nine months ended September 30, 2012 totaled $5.6 million, reflecting an increase of
$33,000 from $5.6 million in noninterest income reported for
the nine months ended September 30,
2011.Customer service fees continue to provide the majority of the
Company's noninterest income from operations, totaling $902,000 for the quarter ended September 30, 2012, as compared to $956,000 for the quarter ended September 30, 2011, and $2.7 million for the nine months ended
September 30, 2012 and 2011. Changes
in noninterest income on a quarter-to-quarter comparative basis
between the third quarters of 2012 and 2011 are largely the result
of a decrease of $2.1 million in
gains recognized on the fair value of financial liabilities..
On a nine month comparative basis, the change in noninterest
income of $33,000 includes an
increase of $1.8 million on gains
realized on the sale of investments and an increase of $515,000 on gains realized on the sale of other
real estate owned, offset by a decrease of $2.1 million in gains recognized on the fair
value of financial liabilities. The gain on sale of investments of
$1.8 million for the nine months
ended September 30, 2012 is included
in other non interest income.
Noninterest expense totaled $4.6
million for the quarter ended September 30, 2012, down $3.5 million from the $8.1
million reported for the quarter ended September 30, 2011. For the nine months ended
September 30, 2012, noninterest
expense totaled $15.0 million as down
$7.4 million from the $22.4 million for the nine months ended
September 30, 2011. Between the third
quarters of 2012 and 2011 , the company experienced significant
decreases in impairment losses on investment securities, impairment
losses on other real estate owned, other real estate owned
expenses, and professional fees. On a nine month comparative basis,
additional decreases in the above listed areas as well as decreases
in impairment losses on goodwill, and regulatory assessments
contributed to the overall decrease.
The Company had a provision for loan loss reserve of
$4,000 for the quarter ended
September 30, 2012 and $1.0 million for the nine months ended
September 30, 2012, compared to
$2.4 million for the quarter ended
September 30, 2011 and $12.5 million for the nine months ended
September 30, 2011. Net loan
charge-offs totaled $456,000 for the
quarter ended September 30, 2012 and
$3.5 million for the nine months
ended September 30, 2012 as compared
to $2.3 million for the quarter ended
September 30, 2011, and $15.1 million for the nine months ended
September 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 2.97% of total loans at September 30, 2012 compared to 2.94% of total
loans at June 30, 2012 and 3.34% at
December 31, 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 September 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 $17.8 million between December 31, 2011 and September 30, 2012. Additionally, nonperforming
assets as a percentage of total assets decreased from 8.77% at
December 31, 2011 to 6.20% at
September 30, 2012. Nonaccrual loans
decreased $7.6 million between
December 31, 2011 and September 30, 2012, while OREO, decreased
$3.6 million during the same period.
Impaired loans totaled $21.1 million
at September 30, 2012, down
$10.7 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
|
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|
Consolidated Balance Sheets
|
|
|
|
(dollars in thousands)
|
|
|
|
|
September
30,
|
|
December
31,
|
|
2012
|
|
2011
|
Assets
|
|
|
|
Cash and noninterest-bearing deposits in
other banks
|
$21,859
|
|
$28,052
|
Cash and due from Federal Reserve
Bank
|
119,661
|
|
96,132
|
Federal funds sold
|
0
|
|
0
|
Cash and cash
equivalents
|
141,520
|
|
124,184
|
Interest-bearing deposits in other
banks
|
1,506
|
|
2,187
|
Investment securities (AFS at market value)
|
42,157
|
|
38,458
|
Loans and leases, net of unearned
fees
|
375,690
|
|
408,146
|
Less: Allowance for credit
losses
|
(11,160)
|
|
(13,648)
|
Net loans
|
364,530
|
|
394,498
|
Premises and equipment - net
|
12,495
|
|
12,675
|
Bank owned life insurance
|
16,552
|
|
16,150
|
Intangible assets
|
4,792
|
|
5,041
|
Other real estate owned
|
23,487
|
|
27,091
|
Deferred Income Taxes
|
10,862
|
|
11,485
|
Other assets
|
15,730
|
|
19,563
|
Total
assets
|
$633,631
|
|
$651,332
|
Deposits:
|
|
|
|
Noninterest bearing demand
and NOW
|
$212,699
|
|
$224,907
|
Money market and
savings
|
228,995
|
|
206,036
|
Time
|
109,362
|
|
143,484
|
Total
deposits
|
551,056
|
|
574,427
|
Borrowed funds
|
0
|
|
0
|
Other liabilities
|
5,386
|
|
5,705
|
Junior subordinated debentures (at fair
value)
|
9,515
|
|
9,027
|
Total
liabilities
|
565,957
|
|
589,159
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Shareholders' equity:
|
|
|
|
Common shares outstanding:
|
|
|
|
13,941,844 at
September 30, 2012
|
42,432
|
|
41,435
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Retained earnings
|
25,054
|
|
21,447
|
Accumulated other comprehensive
loss
|
188
|
|
(709)
|
Total
shareholders' equity
|
67,674
|
|
62,173
|
Total
liabilities and shareholders' equity
|
$633,631
|
|
$651,332
|
|
|
|
|
|
|
|
|
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United
Security Bancshares
|
|
|
|
|
(dollars in 000s, except per share
amounts)
|
|
|
|
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|
Three
Months
Ended
September
30,
|
Three
Months
Ended
September
30,
|
Nine months ended
September 30,
|
Nine months ended
September 30,
|
|
2012
|
2011
|
2012
|
2011
|
Interest
income:
|
|
|
|
|
Interest and fees on loans
|
$5,670
|
$6,378
|
$17,678
|
$19,235
|
Interest on investment
securities
|
397
|
507
|
1,375
|
1,644
|
Interest on deposits in FRB
|
62
|
43
|
157
|
137
|
Interest on deposits in other
banks
|
2
|
9
|
22
|
29
|
Total interest
income
|
6,131
|
6,937
|
19,232
|
21,045
|
Interest
expense:
|
|
|
|
|
Interest on deposits
|
441
|
615
|
1,356
|
2,051
|
Interest on other borrowed
funds
|
68
|
82
|
207
|
250
|
Total interest
expense
|
509
|
697
|
1,563
|
2,301
|
Net
interest income before provision for credit losses
|
5,622
|
6,240
|
17,669
|
18,744
|
Provision for credit losses
|
4
|
2,446
|
1,010
|
12,497
|
Net
interest income
|
5,618
|
3,794
|
16,659
|
6,247
|
Noninterest income:
|
|
|
|
|
Customer service fees
|
902
|
956
|
2,700
|
2,717
|
Increase in cash surrender value
of
|
|
|
|
|
bank owned life
insurance
|
147
|
143
|
427
|
424
|
Gain
(Loss) on sale of other real estate owned
|
49
|
(85)
|
386
|
(129)
|
Gain
(loss) on Fair Value Option of Financial Assets
|
(171)
|
1,923
|
(284)
|
1,778
|
Other noninterest income
|
208
|
353
|
2,396
|
802
|
Total
noninterest income
|
1,135
|
3,290
|
5,625
|
5,592
|
Noninterest expense:
|
|
|
|
|
Salaries and employee benefits
|
2,078
|
2,263
|
6,676
|
6,804
|
Occupancy expense
|
1,004
|
864
|
2,608
|
2,666
|
Professional fees
|
408
|
642
|
1,092
|
2,061
|
Regulatory insurance assessments
|
275
|
366
|
1,058
|
1,354
|
Impairment losses and other expenses on OREO
|
0
|
885
|
0
|
2,007
|
Impairment losses on goodwill and intangible assets
|
0
|
0
|
0
|
1,525
|
Impairment losses on investment securities
|
113
|
308
|
284
|
308
|
Other noninterest expense
|
731
|
2,815
|
3,285
|
5,715
|
Total
noninterest expense
|
4,609
|
8,143
|
15,003
|
22,440
|
Income
before income tax provision
|
2,144
|
(1,059)
|
7,281
|
(10,601)
|
Provision
(benefit) for income taxes
|
778
|
401
|
2,690
|
(3,148)
|
Net
Income
|
$1,366
|
($1,460)
|
4,591
|
($7,453)
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|
United
Security Bancshares
|
|
|
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Selected Financial Data (Quarters
Unaudited)
|
|
|
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|
(dollars in 000s, except per share
amounts)
|
|
|
|
|
|
Three
months
Ended
September
30,
|
Three
months
Ended
September
30,
|
Nine
months ended
September 30,
|
Nine
months ended
September 30,
|
|
2012
|
2011
|
2012
|
2011
|
Basic
earnings per share
|
$0.10
|
($0.10)
|
$0.33
|
($0.53)
|
Diluted
earnings per share
|
$0.10
|
($0.10)
|
$0.33
|
($0.53)
|
Weighted
average basic shares for EPS
|
13,941,844
|
13,941,844
|
13,941,844
|
13,941,844
|
Weighted
average diluted shares for EPS
|
13,941,844
|
13,941,844
|
13,941,844
|
13,941,844
|
|
|
|
|
|
Annualized
return on:
|
|
|
|
|
Average assets
|
.87%
|
(2.98%)
|
.99%
|
(1.50%)
|
Average equity
|
8.72%
|
(29.58%)
|
9.82%
|
(13.68%)
|
Yield on
interest-earning assets
|
5.09%
|
4.90%
|
4.93%
|
5.00%
|
Cost of
interest-bearing liabilities
|
0.65%
|
0.69%
|
.62%
|
0.74%
|
Net
interest margin
|
4.23%
|
4.42%
|
4.53%
|
4.45%
|
Annualized
net charge-offs to average loans
|
.46%
|
7.84%
|
1.19%
|
4.67%
|
|
|
|
|
|
|
September
30,
|
December
31,
|
|
|
|
2012
|
2011
|
|
|
Shares
outstanding - period end
|
13,941,844
|
13,941,844
|
|
|
Book value
per share
|
$4.85
|
$4.46
|
|
|
Tangible
book value per share
|
$4.51
|
$4.10
|
|
|
Efficiency
ratio
|
68.22%
|
96.63%
|
|
|
Total
nonperforming assets
|
$39,305
|
$57,148
|
|
|
Nonperforming assets to total assets
|
6.20%
|
8.77%
|
|
|
Total
Impaired loans
|
$21,143
|
$31,882
|
|
|
Total
nonaccrual loans
|
$10,462
|
$18,098
|
|
|
Allowance
for loan losses to total loans
|
2.97%
|
3.34%
|
|
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SOURCE United Security Bancshares