Vineyard National Bancorp's Record Quarterly Earnings Increase 137%
With Assets Exceeding $1.1 Billion; Increases Earnings Estimate for
2004 RANCHO CUCAMONGA, Calif., April 8 /PRNewswire-FirstCall/ --
Vineyard National Bancorp , and its operating subsidiary Vineyard
Bank, today reported record earnings for the quarter ended March
31, 2004 of $3.0 million, or $0.67 per diluted share, compared with
net earnings of $1.3 million or $0.38 per diluted share for the
same quarter endedin 2003. The growth in earnings of $1.7 million
represented an increase of 137% over the comparable period last
year. Diluted earnings per share increased 76%, which produced a
return on beginning common equity of approximately 44% and a return
on average common equity of approximately 42%. All diluted earnings
per share amounts have been adjusted to reflect the Company's
recently declared 5% stock dividend, the previously issued
convertible Series B preferred stock, stock option grants and
warrants outstanding to acquire its shares. In late September 2003,
the Company issued $28.8 million of 5.60% Noncumulative Convertible
Series B Preferred Stock (the "Series B Preferred Stock"). The
Series B Preferred Stock is convertible at the holder's option into
a share of the Company's common stock at a conversion price, now
adjusted by the stock dividend, of $33.22 per share of common
stock. In the year-end 2003 earnings release, management of the
Company had originally established an earnings estimate for the
year ending December 31, 2004 with a range of $2.85 to $3.10 per
diluted share. With the results of the first quarter now complete,
and the continued implementation of the Company's strategic plan
further underway, management has increased its estimate to a range
of $2.95 to $3.20 per diluted share, an increase of approximately
35% to 50% over 2003's earnings of $2.17 per diluted share. Within
each subsequent reporting period, management will update the range
given the current economic and market factors. The Company
introduced an expanded income property lending division in late
2003, principally targeting multi-family, and to a lesser degree,
commercial lending opportunities within the Southern California
marketplace. The successful introduction of this unit has assisted
the Company in expanding and diversifying its earning asset-base,
which helped increase total assets to a level of $1.1 billion as of
March 31, 2004. Total assets were $887.8 million at December 31,
2003, and $464.7 million at March 31, 2003. The Company's net
interest income before its provision for loan losses increased by
$6.6 million, or 146% for the quarter ended March 31, 2004 as
compared with the same period in 2003, to a level of $11.1 million.
The Company's continued growth of its loan portfolio necessitated a
provision for possible loan losses in the amount of $1.8 million
for the quarter ended March 31, 2004, compared to $0.5 million in
the same period for 2003. This contributed to the increase of the
allowance for possible loan losses to $9.3 million, or 1.1% of
gross loans outstanding at quarter end. The Company will continue
to build the allowance for possible loan losses in the future as it
expands its loan portfolio both in size and diversity of product
lines. Other operating income for the quarter ended March 31, 2004
increased by $0.3 million, or 23%, as compared to the same period
in 2003, to a level of $1.6 million. Total net revenues (net
interest income and other operating income) for the first quarter
ended March 31, 2004 increased by $6.9 million or 118% as compared
to the same period in 2003. The net interest margin of the Bank for
the quarter ended March 31, 2004 was approximately 5.0%, which is a
slight increase from the same period in 2003. The Company's growth
in its loan portfolio produced a first quarter 2004 increase of
$277.6 million or 46%, bringing gross loans outstanding to $874.6
million at March 31, 2004. The largest component of this first
quarter 2004 increase is centered in multi-family apartment lending
within the Southern California marketplace, followed by the
established coastal and tract construction product lines. For the
quarter ended March 31, 2004, total deposits increased by $146.9
million, or 24%, to $750.2 million, as compared to year-end 2003's
level of $603.3 million. With the growth of the Company's earning
asset base, the focus on core deposit growth within the nine
community banking centers has increased with significant additions
in relationship and business development personnel. The Company's
demand deposits increased by approximately $15.6 million in the
first quarter of 2004 alone, bringing the total amount of demand
deposit to approximately $109.8 million. The Company's cost of
funds of approximately 1.7% remains consistent with the levels
experienced over the past three and one-half years while it has
increased the total deposit base by approximately 650% to its
levels of today. Total operating expenses for the quarter ended
March 31, 2004 were $5.9 million, an increase of $2.7 million or
83% over the same period in 2003. The Company has added significant
resources to its operating areas in relationship management and
business development, credit administration, information
technology, training, marketing and corporate services to support
the growth realized in the past three years. This has, in turn,
increased the costs associated with salaries, cash incentives and
benefits for the first quarter of 2004 to $3.2 million,
representing 54% of total operating costs. The Company's efficiency
ratio, which measures the relationship of total operating expenses
and total operating income, was 46% for the quarter ended March 31,
2004, as compared with 55% for the same period in 2003. For the
quarter ended March 31, 2004, the Company's income tax provision
was $2.1 million as compared to $0.9 million in the same period in
2003. The Bank continues to be "well-capitalized" pursuant to the
guidelines established by regulatory agencies. To be considered
"well-capitalized" an institution must have total risk-based
capital of 10% or greater, and a leverage ratio of 5% or greater.
The Bank's total risk-based and leverage capital ratios were 11.3%
and 10.4% at March 31,2004, respectively. During the first quarter
of 2004, the Company completed the issuance of an additional $10.0
million of Trust Preferred Securities through a newly formed
subsidiary, Vineyard Statutory Trust V. The use of proceeds
included the contribution of $10.0 million into the Bank as
additional capital to support its growth, operations and lending
requirements. As a continuing component to its Shareholders'
Relations Program, the Company has prepared a presentation
describing its operatingperformance and strategies. The
presentation may be accessed at http://www.vineyardbank.com/.
Vineyard National Bancorp operates Vineyard Bank, a community bank
principally located in the Inland Empire region of Southern
California. The Bank operates nine full-service branches located in
Rancho Cucamonga, Chino, Corona, Crestline, Diamond Bar, Irwindale,
Lake Arrowhead, La Verne, and Manhattan Beach, in addition to loan
production offices in Irvine, San Diego and Anaheim. Shares of the
Company's common stock are traded on the Nasdaq National Market
System under the ticker symbol VNBC. Shares of the Company's Series
B Preferred Stock are traded on the American Stock Exchange under
the ticker symbol VLP PrB. This press release contains
forward-looking statements as referenced in the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are
inherently unreliable and actual results may vary. Factors which
could cause actual results to differ from these forward-looking
statements include changes in the competitive marketplace, changes
in the interest rate environment, economic conditions, outcome of
pending litigation, risks associated with credit quality and other
factors discussed in the Company's filings with the Securities and
Exchange Commission. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
VINEYARD NATIONAL BANCORP CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share amounts) Three Months Ended
March 31, 2004 2003 ** $ Change % Change (unaudited) (unaudited)
Interest Income Loans, including fees $13,082 $5,286 $7,796 147%
Investment securities and federal funds sold 2,100 1,344 756 56%
Total Interest Income 15,182 6,630 8,552 129% Interest Expense
Deposits 3,018 1,521 1,497 98% Other borrowings 1,050 589 461 78%
Total Interest Expense 4,068 2,110 1,958 93% Net Interest Income
11,114 4,520 6,594 146% Provision for loan losses 1,800 500 1,300
260% Net interest income after provision for loan losses 9,314
4,020 5,294 132% Other operating income 1,639 1,334 305 23% Gross
Operating Income 10,953 5,354 5,599 105% Operating Expenses
Salaries and benefits 3,222 1,766 1,456 82% Occupancy and equipment
981 442 539 122% Other operating expenses 1,727 1,025 702 68% Total
Operating Expenses 5,930 3,233 2,697 83% Earnings before income
taxes 5,023 2,121 2,902 137% Income tax provision 2,054 867 1,187
137% Net Income $2,969 $1,254 $1,715 137% Earnings per common share
Basic $0.80 * $0.40 * $0.40 100% Diluted $0.67 * $0.38 * $0.29 76%
Efficiency Ratio 46% 55% * Earnings per share were adjusted to
reflect the 5% stock dividends paid in January 2004 and January
2003. ** March 31, 2003 amounts were restated to deconsolidate its
Vineyard Statutory Trust Companies, which did not have a material
impact on the financial condition or operating results of the
Company. VINEYARD NATIONAL BANCORP CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except per share amounts) March 31, December
31, 2004 2003 $ Change % Change (unaudited) (audited) Assets
Federal funds sold $-- $39,400 $(39,400) -100% Investment
securities available-for-sale 173,787 202,068 (28,281) -14% Loans,
net of deferred fees and costs 874,607 597,007 277,600 46% Less
allowance for loan losses (9,323) (7,537) (1,786) 24% Net loans
865,284 589,470 275,814 47% Total Earnings Assets 1,039,071 830,938
208,133 25% Cash and due from banks 25,774 18,842 6,932 37%
Premises and equipment, net 9,359 9,435 (76) -1% Other assets
32,462 28,585 3,877 14% Total Assets $1,106,666 $887,800 $218,866
25% Liabilities and Stockholders' Equity Liabilities Deposits
Noninterest- bearing $109,781 $94,162 $15,619 17% Interest-bearing
640,464 509,164 131,300 26% Total Deposits 750,245 603,326 146,919
24% Federal Home Loan Bank advances and other borrowings 239,000
182,000 57,000 31% Subordinated debentures 5,000 5,000 -- 0% Junior
subordinated debentures 48,457 38,147 10,310 27% Other liabilities
7,925 7,152 773 11% Total Liabilities 1,050,627 835,625 215,002 26%
Stockholders' Equity Series A perpetual preferred stock 2,450 2,450
-- 0% Series B convertible preferred stock 26,549 26,549 -- 0%
Common stock equity 28,293 26,264 2,029 8% Cumulative other
comprehensive loss (1,253) (3,088) 1,835 N/A Total Stockholders'
Equity 56,039 52,175 3,864 7% Total Liabilities and Stockholders'
Equity $1,106,666 $887,800 $218,866 25% Number of Shares of Common
Stock Outstanding 3,162,045 * 3,145,715 * Number of Shares of
Common Stock Outstanding, assuming conversion of Series B preferred
stock 4,027,512 * 4,011,182 * Net Book Value of Common Stock, Basic
$8.55 * $7.37 * Net Book Value of Common Stock, excluding other
comprehensive loss $8.95 * $8.35 * Net Book Value of Common Stock,
assuming conversion of Series B preferred stock $13.31 * $12.40 * *
Number of shares and book value per share were adjusted to reflect
the 5% stock dividends paid in January 2004 and in January 2003.
DATASOURCE: Vineyard National Bancorp CONTACT: Corporate Offices of
Vineyard National Bancorp, +1-909-581-1668, or fax,
+1-909-278-0041, Web site: http://www.vineyardbank.com/
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