BELLEVUE, Wash.--(BUSINESS WIRE)--Puget Sound Bank (OTCQB:PUGB) today reported record net income of $752,521 or $0.25 per share for the quarter ending March 31, 2014, an increase of 41% as compared to $533,126 or $0.21 per share for the year earlier period.
This quarter’s net income exceeds all previous quarterly results in the Company’s nine-year history and is the first quarter since announcing the purchase of Core Business Bank in March 2013 (completed in June 2013) to include no acquisition costs.
“The acquisition has met our expectations for delivering ongoing, sustainable growth to our operations with a carefully managed level of risk,” said Jim Mitchell, Puget Sound Bank president and chief executive officer. “And we’re pleased to report our customers experienced a smooth integration last fall. In addition, our tangible book value has increased in the past year, demonstrating the acquisition was accretive within the first year.”
Total loans increased 36% to $277.8 million as compared to $203.6 million a year earlier. Excluding the acquired Core Business Bank loans, Puget Sound Bank’s organic loan growth was 20% as compared to last year. Puget Sound Bank’s C&I (commercial and industrial) loans account for approximately 64% of the Bank’s portfolio. This places the Bank in the top 15% of all commercial banks in Washington state for C&I loans as a percentage of total loans.
2014 First Quarter Highlights
- Total assets grew 23% to $339.0 million as compared to $276.0 million a year ago.
- Noninterest demand deposits increased 14% to $108.8 million as compared to $95.6 million a year earlier, or 41% of total deposits (up from 40% a year ago).
- Total loans grew 36% to $277.8 million and total deposits grew 11% to $264.1 million as compared to a year ago.
- Net interest margin was 4.17% for the quarter, down slightly from 4.20% one year ago.
- Tangible book value per share increased to $11.39 from $11.05 a year earlier.
- Return on equity increased to 8.72% from 7.75% a year ago.
- Return on assets increased to 0.90% from 0.81% a year ago.
- Nonperforming assets to total assets decreased to 0.22%, down from 0.66% in the year-earlier period.
- Allowance for loan losses and the fair value discount on the acquired loan portfolio, together were 1.38% of loans.
- The efficiency ratio improved to 67.1% for the quarter compared to 69.6% in the year earlier quarter.
- Capital ratios continue to exceed regulatory requirements, with total risk-based capital substantially above well-capitalized regulatory requirements.
- For the 14th consecutive quarter, Puget Sound Bank was awarded a 5-star rating, the highest available from independent banking rating agency BauerFinancial.
“Our numbers show that our C&I focus and acquisition strategy can deliver the growth necessary for Puget Sound Bank to become a high-performing company,” said Mr. Mitchell, “and the board, management and staff are focused on that goal.”
About Puget Sound Bank
Puget Sound Bank is one of Washington state’s top commercial banks (as measured by commercial and industrial loans as a percentage of total loans) and proudly serves the greater Puget Sound region of Washington state. Based in Bellevue, Washington, the bank was founded to meet the specialized needs of small- and medium-sized businesses, select commercial real estate projects, professional service providers and high net worth individuals. Puget Sound Bank offers a full range of competitive financial products including an advanced suite of cash management services. Customers can access their accounts in-branch, online, on their smartphones or through Puget Sound Bank's banking relationships offering branch and ATM deposit access throughout the continental United States. For more information visit www.PugetSoundBank.com or call (425) 455-2400.
Puget Sound Bank trades on the OTCQB® electronic marketplace under the symbol PUGB. To access investor relations information for Puget Sound Bank, visit www.PugetSoundBank.com/IR or call (425) 467-2037.
Forward-Looking Statement Safe Harbor: This news release contains comments or information that constitutes forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are based on current expectations that involve a number of risks and uncertainties. Forward-looking statements describe Puget Sound Bank’s projections, estimates, plans and expectations of future results and can be identified by words such as “believe,” “intend,” “estimate,” “likely,” “anticipate,” “expect,” and other similar expressions. They are not guarantees of future performance. Actual results may differ materially from the results expressed in these forward-looking statements, which because of their forward-looking nature, are difficult to predict. Investors should not place undue reliance on any forward-looking statement, and should consider factors that might cause differences including but not limited to the degree of competition by traditional and nontraditional competitors, declines in real estate markets, an increase in unemployment or sustained high levels of unemployment; changes in interest rates; greater than expected costs to integrate acquisitions, adverse changes in local, national and international economies; changes in the Federal Reserve’s actions that affect monetary and fiscal policies; changes in legislative or regulatory actions or reform, including without limitation, the Dodd-Frank Wall Street Reform and Consumer Protection Act; demand for products and services; changes to the quality of the loan portfolio and our ability to succeed in our problem-asset resolution efforts; the impact of technological advances; changes in tax laws; and other risk factors. Puget Sound Bank undertakes no obligation to publicly update or clarify any forward-looking statement to reflect the impact of events or circumstances that may arise after the date of this release.
Puget Sound Bank
First Quarter 2014
CONSOLIDATED STATEMENT OF OPERATIONS
|($ in thousands except per share data)||
|Net interest income||$||3,261||3,324||2,629|
|Provision for loan losses||$||0||264||46|
|Net interest income after provision for loan losses||
|Pre-tax Net income||$||1,127||865||794|
|Provision for income taxes (benefit)||$||374||311||261|
|Net income available to common shareholders||$||728||528||508|
Earnings per share1
|Average shares outstanding||2,948||2,921||2,369|
|Return on average assets||0.90%||0.68%||0.81%|
Return on average tangible common equity1
|Net interest margin||4.17%||4.24%||4.20%|
|Tier 1 leverage ratio||13.09%||13.68%|
|Tier 1 risk-based capital ratio||14.22%||15.33%|
|Total risked based capital ratio||15.47%||16.58%|
|Tangible Common Equity Ratio||9.98%||9.73%||9.59%|
|Net loan charge-offs (recoveries)||$||0||(126)||213|
|Allowance for loan losses||$||3,538||3,538||3,095|
|Allowance for losses to total loans||1.27%||1.29%||1.52%|
|Other real estate owned||$||0||0||0|
|Nonperforming assets to total assets||0.22%||0.22%||0.66%|
1Includes preferred stock dividends not included in net income.
Puget Sound Bank
First Quarter 2014
CONSOLIDATED FINANCIAL HIGHLIGHTS
|($ in thousands except per share data)||
|Cash and Due From Banks||$||13,966||16,627||8,503|
|Commercial and Industrial Loans||$||124,867||126,764||99,031|
|Owner-Occupied Commercial Real Estate||$||54,013||54,377||37,197|
|Other Commercial Real Estate||$||71,521||71,509||51,554|
|Acquired Loan Fair Value Adjustment||$||(309)||(378)||-|
|Deferred Loan Fees||$||(515)||(522)||(360)|
|Allowance for Loan Losses||$||(3,538)||(3,538)||(3,095)|
|Goodwill/Core Deposit Intangible||$||2,185||2,196||-|
|Non-interest bearing Demand||$||108,766||122,148||95,560|
|Interest Bearing Demand||$||22,478||24,529||17,763|
|Money Market and Savings||$||98,080||108,158||78,473|
|Certificates of Deposit||$||34,742||25,932||46,611|
|Total Liabilities and Equity||$||338,958||339,263||276,029|
|Tangible Shareholders' equity||$||33,603||32,785||26,269|
|Tangible book value per share||