Presidio Bank Reports Financial Results for the First Quarter 2014

Net income up 58% over First Quarter 2013

SAN FRANCISCO--()--Presidio Bank (OTCBB: PDOB), a Bay Area business bank, today reported unaudited results for the first quarter ended March 31, 2014 with net income for the quarter of $693 thousand, a 58 % increase over the $439 thousand achieved in the first quarter of 2013. Loans, deposits and total assets all grew to record levels during the quarter.

“We are pleased that our growth momentum continued even in the traditionally soft first quarter,” said Presidio Bank President and CEO Steve Heitel. “While the Bank is still attracting new clients and gaining market share, it is pleasing to now see growth coming from our existing clients as well—another sign of improved economic conditions.”

Financial Highlights

  • Total Loans outstanding grew by $17 million or 4% over the quarter ended December 31, 2013 and by $71 million or 22% over the quarter ended March 31, 2013.
  • Total Deposits increased by $27 million or 7% from the quarter ended December 31, 2013 and by $90 million or 27% from the quarter ended March 31, 2013. A number of depositors were holding higher than usual balances at quarters end which somewhat exaggerates the deposit growth in the quarter. We expect these balance levels to normalize in the second quarter.
  • Net interest income of $4.4 million in the first quarter was up 5% over the fourth quarter of 2013 despite two fewer days in the first quarter. Net interest income was up 18% over the same quarter last year.
  • Operating Expenses increased 9% from the fourth quarter as the first quarter has seasonally high employer payroll taxes and employee benefit expense. In addition, the Bank started to incur expenses related to its previously announced new office in San Mateo, projected to open in the second half of the year.
  • Net Income applicable to common shareholders was $604 thousand for the quarter, an increase of 104% over the first quarter of 2013. Net Income was down slightly from the December quarter, primarily due to the aforementioned expense and day-count impacts.
  • Diluted earnings per common share were $0.14 for the quarter compared to $0.19 in the fourth quarter of 2013 and $0.07 in the first quarter of 2013. EPS in the fourth quarter of 2013 included $0.03 in non-recurrring gain on redemption of Perpetual Preferred Stock.
  • Book value per share increased to $9.15 per share as of March 31, 2014 from $8.99 per share at December 31, 2013 and $8.50 per share at March 31, 2013.

“It’s great to be off to a strong start in 2014,” said Presidio Bank Chairman and Founder, Jim Woolwine. “I am honored that high quality clients are continuing to choose Presidio Bank as their financial partner.”

 

1st Quarter 2014 Financial Results

(Dollars in thousands, except per share amounts, unaudited)

 
Condensed Balance Sheet
 
    3/31/2014       12/31/2013     Change             3/31/2013     Change
                     
Cash and due from banks 5,103 5,694 -10.4% 3,769 35.4%
Interest bearing due from banks   66,188       49,545     33.6%             46,153     43.4%
Total cash and equivalents 71,291 55,239 29.1% 49,922 42.8%
Investment securities 14,124 14,230 -0.7% 13,378 5.6%
Loans, net of fees 389,749 373,421 4.4% 318,766 22.3%
Allowance for loan losses   (4,871)       (4,867)     0.1%             (4,945)     -1.5%
Net loans 384,878 368,554 4.4% 313,821 22.6%
Premises and equipment, net 1,033 932 10.8% 1,019 1.4%
Other assets and interest receivable   5,086       4,863     4.6%             5,101     -0.3%
Total assets 476,412 443,818 7.3% 383,241 24.3%
 
Non-interest-bearing demand 143,202 132,546 8.0% 113,118 26.6%
Interest bearing transaction 62,994 71,760 -12.2% 58,479 7.7%
Money market and savings accounts 178,869 153,180 16.8% 119,996 49.1%
Time deposits   39,038       39,672     -1.6%             43,298     -9.8%
Total deposits 424,103 397,158 6.8% 334,891 26.6%
Other liabilities   7,282       2,376     206.5%             2,053     254.7%
Total liabilities 431,385 399,534 8.0% 336,944 28.0%
 
Preferred stock 6,827 6,811 0.2% 11,018 -38.0%
Common stock 43,667 43,540 0.3% 41,438 5.4%
Retained earnings (5,311) (5,898) 10.0% (6,121) 13.2%
Other comprehensive income   (156)       (169)     7.7%             (38)      
Total shareholder’s equity   45,027       44,284     1.7%             46,297     -2.7%
Total liabilities and equity 476,412 443,818 7.3% 383,241 24.3%
 
Book value per share
Book value per share $ 9.15 $ 8.99 $ 8.50
Total shares outstanding EOP 4,174 4,170 4,152
 
Capital Ratios
Tier 1 leverage ratio 10.0% 10.0% 11.5%
Tier 1 risk-based capital ratio 10.3% 10.5% 12.4%
Total risk-based capital ratio 11.6% 11.7% 13.7%
Tangible common risk-based ratio 8.7% 8.8% 9.7%
 
 

Condensed Statement of Income

 
  For the three months ended
  3/31/2014       12/31/2013    

Change
Fav./(Unfav.)

            3/31/2013    

Change
Fav./(Unfav.)

                     
Interest income 4,572 4,388 4.2% 3,898 17.3%
Interest expense   193       200     3.5%             193     0.0%
Net interest income 4,379 4,188 4.6% 3,705 18.2%
Provision for loan loss   -       -     NM             -     NM
Net interest income after provision 4,379 4,188 4.6% 3,705 18.2%
 
Other income 170 151 12.6% 129 31.8%
 
Compensation and benefit expenses 2,186 1,887 (15.8%) 1,873 (16.7%)
Occupancy and equipment expenses 373 382 2.4% 385 3.1%
Data processing 256 258 0.8% 244 (4.9%)
Professional and legal 95 107 11.2% 132 28.0%
Other operating expenses   465       452     (2.9%)             456     (2.0%)
Total operating expenses   3,375       3,086     (9.4%)             3,090     (9.2%)
Net income before taxes 1,174 1,253 (6.3%) 744 57.8%
Income taxes   481       514     6.4%             305     (57.7%)
Net income 693 739 (6.2%) 439 57.9%
Preferred dividends   89       117     23.9%             142     37.5%
Net income to common 604 622 (2.9%) 297 103.6%
 
Earnings Per Share
Diluted earnings per share $ 0.14 $ 0.19 $ 0.07
 
Performance Ratios
Return on average assets 0.62% 0.66% 0.45%
Return on average common equity 6.42% 6.63% 3.40%
Net interest margin 4.00% 3.80% 3.88%
Cost of funds 0.19% 0.20% 0.23%
Efficiency ratio 74.2% 71.1% 80.6%
 
Average Balances
Total assets 451,259 444,672 393,831
Earning assets 444,436 437,002 387,213
Total loans 382,154 356,992 312,243
Total deposits 395,956 395,489 345,514
Common equity 38,134 37,239 35,377
 

NM = Not Meaningful

 
 

About Presidio Bank

Presidio Bank provides business banking services to small and mid-size businesses, including professional service firms, real estate developers and investors, and not-for-profit organizations, and to their owners who desire personalized, responsive service with access to local decision makers. Presidio Bank offers clients the resources of a large bank combined with the personalized services of a neighborhood bank. Presidio Bank is headquartered in San Francisco, California and currently operates four banking offices in San Francisco, Walnut Creek, San Rafael and Palo Alto. More information is available at www.presidiobank.com. Presidio Bank is a member of FDIC and an Equal Housing Lender.

This press release contains certain forward-looking statements that involve risk and uncertainties. These statements are identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “plan,” “estimate,” “project,” or similar expressions. The risks and uncertainties that may affect the operations, performance, development, growth projections and results of Presidio Bank’s business include, but are not limited to, the growth of the economy, interest rate movements, timely development by Presidio Bank of technology enhancements for its products and operating systems, the impact of competitive products, services and pricing, client-based requirements, Congressional legislation, changes in regulatory or generally accepted accounting principles and similar matters. Readers are cautioned not to place undue reliance on forward-looking statements which are subject to influence by the named risk factors and unanticipated future events. Actual results, accordingly, may differ materially from management expectations.

Contacts

Presidio Bank
Steve Heitel, 415-229-8428
President & CEO
or
Ed Murphy, 415-229-8403
EVP/CFO
or
Annette Gelinas, 415-229-8415 (o) / 925-787-2956 (c)
SVP/Marketing Director
agelinas@presidiobank.com

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Contacts

Presidio Bank
Steve Heitel, 415-229-8428
President & CEO
or
Ed Murphy, 415-229-8403
EVP/CFO
or
Annette Gelinas, 415-229-8415 (o) / 925-787-2956 (c)
SVP/Marketing Director
agelinas@presidiobank.com