SAVANNAH, Ga., Jan. 26, 2010 (GLOBE NEWSWIRE) -- The Savannah Bancorp, Inc. (Nasdaq:SAVB) reported net income for the fourth quarter 2009 of $762,000 compared to $778,000 for the same period in 2008, a decrease of 2.1 percent. Fourth quarter net income per diluted share was $0.13 in 2009 and 2008. Net income for 2009 was $929,000 compared with net income of $6,006,000 in 2008, a decrease of 85 percent. Net income per diluted share was $0.16 for 2009 and $1.01 in 2008, a decrease of 84 percent. The decline in 2009 earnings results primarily from a higher provision for loan losses, higher FDIC insurance premiums and a higher loss on sale of foreclosed assets when compared to 2008 partially offset by a higher gain on sale of securities. Other growth and performance ratios are included in the attached financial highlights and information.
Total assets increased 4.0 percent to $1.05 billion at December 31, 2009, up $43 million from $1.01 billion a year earlier. Loans totaled $884 million compared with $865 million one year earlier, an increase of 2.2 percent. Deposits totaled $885 million at December 31, 2009 and $832 million at December 31, 2008, an increase of 6.4 percent. Average total assets increased 6.3 percent to $1.02 billion in 2009 from $960 million in 2008. Average portfolio loans were $841 million in 2009 compared with $822 million in 2008, an increase of 2.3 percent. Average deposits were $860 million in 2009 and $785 million in 2008, an increase of 9.6 percent. Shareholders' equity decreased to $79 million at December 31, 2009 from $81 million at December 31, 2008 due solely to a decrease in accumulated other comprehensive income. The Company's total capital to risk-weighted assets ratio was 11.49 percent, which exceeds the 10 percent required by the regulatory agencies to maintain well-capitalized status.
President and CEO John C. Helmken II said, "Though not at the profitability levels of prior years, we are especially pleased to record a fourth quarter and annual profit given the level of credit quality issues that we have aggressively addressed through charge-offs, impairments and loan loss provisioning."
The allowance for loan losses was $17,678,000, or 2.00 percent of loans at December 31, 2009 compared to $13,300,000 or 1.54 percent of total loans a year earlier. Nonperforming assets were $42,476,000 or 4.04 percent of total assets at December 31, 2009 compared to $35,703,000 or 3.54 percent at December 31, 2008. For 2009, net charge-offs were $8,687,000 compared to $5,564,000 for 2008. The provision for loan losses was $13,065,000 in 2009 compared to $6,000,000 in 2008. The higher provision for loan losses was primarily due to real estate-related charge-offs and continued weakness in the Company's local real estate markets. Fourth quarter 2009 net charge-offs were $1,762,000 compared to net charge-offs of $1,360,000 in the same period in 2008. The provision for loan losses for the fourth quarter of 2009 was $2,560,000 compared to $2,270,000 for the fourth quarter of 2008.
Helmken added, "While it is not ‘business as usual' in times like these, our growing customer base can continue to expect our high touch, relationship-focused banking that serves our banks, customers and communities well in good times as well as bad. As I have said before, our 12.5 percent local market share translates to 87.5 percent opportunity. With regard to our loan portfolio, management remains focused on working problem credits and closely monitoring our loans and relationships. Our portfolio is regularly reviewed internally as well as by a third party firm.
"Our profitability, well-capitalized status, liquidity and strong balance sheet are the foundations we have laid to manage our Company in the current environment as well as to take advantage of the opportunities that lie ahead. We have also added some great people to our team in anticipation of these opportunities."
Net interest income increased $62,000, or 0.2 percent, in 2009 over 2008. In 2009, the net interest margin declined to 3.46 percent from 3.58 percent in 2008, primarily due to higher levels of noninterest-earning assets. Noninterest income increased $1,147,000 or 15 percent, including $2,119,000 in gain on sale of securities, partially offset by a lower gain on hedges and lower trust and asset management fees. Noninterest expense increased $2,236,000, or 9.0 percent, during 2009 as compared to 2008. Noninterest expense included a $2,396,000 higher loss on the sale of foreclosed assets, $1,233,000 of higher FDIC insurance premiums partially offset by $1,438,000 in lower salaries and employee benefits.
In the fourth quarter the Company elected to withdraw its application for participation in the United States Treasury Department's TARP Capital Purchase Program.
The Board of Directors approved a regular quarterly cash dividend of 2 cents per share for the first quarter. The dividend is payable on February 22, 2010 to shareholders of record on February 5, 2010.
The Savannah Bancorp, Inc. ("SAVB" or "Company"), a bank holding company for The Savannah Bank, N.A., Bryan Bank & Trust (Richmond Hill, GA) and Minis & Co., Inc., is headquartered in Savannah, Georgia and began operations in 1990. SAVB has ten branches in Coastal Georgia and South Carolina. Its primary businesses include loan, deposit, trust, asset management and mortgage origination services provided to local customers.
Forward-Looking Statements
This press release contains statements that constitute "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934 as amended by the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among others, statements identified by words or phrases such as "potential," "opportunity," "believe," "expect," "anticipate," "current," "intention," "estimate," "assume," "outlook," "continue," "seek," "plans," "achieve," and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "may" or similar expressions. These statements are based on the current beliefs and expectations of our management and are subject to significant risks and uncertainties. There can be no assurance that these transactions will occur or that the expected benefits associated therewith will be achieved. A number of important factors could cause actual results to differ materially from those contemplated by our forward-looking statements in this press release. Many of these factors are beyond our ability to control or predict. These factors include, but are not limited to, those found in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise.
A printable PDF format of this entire Annual Earnings Release may be obtained from the Corporate Website at www.savb.com under the "SEC Filings and More" link and the "Latest Earnings Release" selection.
The Savannah Bancorp, Inc. and Subsidiaries | |||
Fourth Quarter Financial Highlights | |||
December 31, 2009 and 2008 | |||
($ in thousands, except per share data) | |||
(Unaudited) | |||
Balance Sheet Data at December 31 | 2009 | 2008 | % Change |
Total assets | $1,050,188 | $1,007,284 | 4.3 |
Interest-earning assets | 959,219 | 931,448 | 3.0 |
Loans | 883,886 | 864,974 | 2.2 |
Other real estate owned | 8,329 | 8,100 | 2.8 |
Deposits | 884,569 | 832,015 | 6.3 |
Interest-bearing liabilities | 883,527 | 837,558 | 5.5 |
Shareholders' equity | 79,026 | 80,932 | (2.4) |
Loan to deposit ratio | 100% | 104% | (3.8) |
Equity to assets | 7.52% | 8.03% | (6.4) |
Tier 1 capital to risk-weighted assets | 10.23% | 10.28% | (0.5) |
Total capital to risk-weighted assets | 11.49% | 11.54% | (0.4) |
Outstanding shares (000s) | 5,932 | 5,934 | 0.0 |
Book value per share | $13.32 | $13.64 | (2.3) |
Tangible book value per share | $12.90 | $13.19 | (2.2) |
Market value per share | $8.00 | $8.85 | (9.6) |
Loan Quality Data | |||
Nonaccruing loans | $32,545 | $26,277 | 24 |
Loans past due 90 days – accruing | 1,602 | 1,326 | 21 |
Net charge-offs | 8,687 | 5,564 | 56 |
Allowance for loan losses | 17,678 | 13,300 | 33 |
Allowance for loan losses to total loans | 2.00% | 1.54% | 30 |
Nonperforming assets to total assets | 4.04% | 3.54% | 14 |
Performance Data for the Year | |||
Net income | $929 | $6,006 | (85) |
Return on average assets | 0.09% | 0.63% | (86) |
Return on average equity | 1.16% | 7.60% | (85) |
Net interest margin | 3.46% | 3.58% | (3.4) |
Efficiency ratio | 65.60% | 61.98% | 5.8 |
Per share data: | |||
Net income – basic | $0.16 | $1.01 | (84) |
Net income – diluted | $0.16 | $1.01 | (84) |
Dividends | $0.185 | $0.50 | (63) |
Average shares (000s): | |||
Basic | 5,933 | 5,930 | 0.1 |
Diluted | 5,936 | 5,947 | (0.2) |
Performance Data for the Fourth Quarter | |||
Net income | $762 | $778 | (2.1) |
Return on average assets | 0.29% | 0.31% | (6.5) |
Return on average equity | 3.80% | 3.86% | (1.6) |
Net interest margin | 3.47% | 3.24% | 7.1 |
Efficiency ratio | 66.28% | 63.89% | 3.7 |
Per share data: | |||
Net income – basic | $0.13 | $0.13 | 0.0 |
Net income – diluted | $0.13 | $0.13 | 0.0 |
Dividends | $0.020 | $0.125 | (84) |
Average shares (000s): | |||
Basic | 5,933 | 5,933 | 0.0 |
Diluted | 5,936 | 5,942 | (0.1) |
The Savannah Bancorp, Inc. and Subsidiaries | ||
Consolidated Balance Sheets | ||
December 31, 2009 and 2008 | ||
($ in thousands, except share data) | ||
December 31, | ||
2009 | 2008 | |
Assets | (Unaudited) | (Unaudited) |
Cash and due from banks | $19,253 | $15,088 |
Federal funds sold | 8,575 | 9,701 |
Interest-bearing deposits in banks | 12,707 | 3,312 |
Cash and cash equivalents | 40,535 | 28,101 |
Securities available for sale, at fair value (amortized | ||
cost of $86,596 and $79,447) | 87,919 | 81,619 |
Loans held for sale | -- | 291 |
Loans, net of allowance for loan losses of $17,678 and $13,300 | 866,208 | 851,674 |
Premises and equipment, net | 15,574 | 11,107 |
Other real estate owned | 8,329 | 8,100 |
Bank-owned life insurance | 6,434 | 6,216 |
Goodwill and other intangible assets, net | 2,498 | 2,642 |
Other assets | 22,691 | 17,534 |
Total assets | $1,050,188 | $1,007,284 |
Liabilities | ||
Deposits: | ||
Noninterest-bearing | $82,557 | $82,723 |
Interest-bearing demand | 143,559 | 128,965 |
Savings | 16,893 | 14,370 |
Money market | 228,124 | 199,194 |
Time deposits | 413,436 | 406,763 |
Total deposits | 884,569 | 832,015 |
Short-term borrowings | 55,541 | 67,787 |
Federal Home Loan Bank advances – long-term | 15,664 | 10,169 |
Subordinated debt to nonconsolidated subsidiaries | 10,310 | 10,310 |
Other liabilities | 5,078 | 6,071 |
Total liabilities | 971,162 | 926,352 |
Shareholders' equity | ||
Preferred stock, par value $1 per share: | ||
authorized 10,000,000 shares, none issued | -- | -- |
Common stock, par value $1 per share:authorized | ||
20,000,000 shares; issued 5,933,789 shares | 5,934 | 5,934 |
Additional paid-in capital | 38,605 | 38,516 |
Retained earnings | 33,383 | 33,552 |
Treasury stock, 1,443 and 318 shares | (4) | (4) |
Accumulated other comprehensive income, net | 1,108 | 2,934 |
Total shareholders' equity | 79,026 | 80,932 |
Total liabilities and shareholders' equity | $1,050,188 | $1,007,284 |
The Savannah Bancorp, Inc. and Subsidiaries | |||||||||
Consolidated Statements of Income | |||||||||
for the Two Years and Five Quarters Ending December 31, 2009 | |||||||||
($ in thousands, except per share data) | |||||||||
(Unaudited) | |||||||||
For the Years Ended | 2009 | 2008 | Q4-09/ | ||||||
December 31, | % | Fourth | Third | Second | First | Fourth | Q4-08 | ||
2009 | 2008 | Chg | Quarter | Quarter | Quarter | Quarter | Quarter | % Chg | |
Interest and dividend income | |||||||||
Loans, including fees | $47,081 | $53,259 | (12) | $11,793 | $11,786 | $11,856 | $11,646 | $12,268 | (3.9) |
Loans held for sale | -- | 60 | (100) | -- | -- | -- | -- | 8 | (100) |
Investment securities | 3,419 | 3,081 | 11 | 668 | 932 | 894 | 905 | 817 | (18) |
Deposits with banks | 45 | 149 | (70) | 9 | 11 | 12 | 13 | 18 | (50) |
Federal funds sold | 18 | 133 | (86) | 6 | 8 | 2 | 2 | 16 | (63) |
Total interest and dividend income | 50,563 | 56,682 | (11) | 12,496 | 12,737 | 12,764 | 12,566 | 13,127 | (4.8) |
Interest expense | |||||||||
Deposits | 16,454 | 21,842 | (25) | 3,652 | 4,057 | 4,264 | 4,481 | 4,969 | (27) |
Short-term borrowings & sub debt | 1,502 | 2,303 | (35) | 446 | 354 | 338 | 364 | 543 | (22) |
FHLB advances | 302 | 294 | 2.7 | 83 | 86 | 78 | 55 | 80 | 3.8 |
Total interest expense | 18,258 | 24,439 | (25) | 4,181 | 4,497 | 4,680 | 4,900 | 5,592 | (25) |
Net interest income | 32,305 | 32,243 | 0.2 | 8,315 | 8,240 | 8,084 | 7,666 | 7,535 | 10 |
Provision for loan losses | 13,065 | 6,000 | 118 | 2,560 | 3,560 | 3,225 | 3,720 | 2,270 | (13) |
Net interest income after the | |||||||||
provision for loan losses | 19,240 | 26,243 | (27) | 5,755 | 4,680 | 4,859 | 3,946 | 5,265 | 9.3 |
Noninterest income | |||||||||
Trust and asset management fees | 2,351 | 2,832 | (17) | 613 | 580 | 571 | 587 | 675 | (9.2) |
Service charges on deposits | 1,809 | 1,881 | (3.8) | 464 | 446 | 432 | 467 | 447 | 3.8 |
Mortgage related income, net | 432 | 295 | 46 | 92 | 89 | 159 | 92 | 60 | 53 |
Other operating income | 1,238 | 1,216 | 1.8 | 322 | 324 | 309 | 283 | 314 | 2.5 |
Gain on hedges | 873 | 1,288 | (32) | 48 | 184 | 245 | 396 | 574 | (92) |
Gain on sale of securities | 2,119 | 163 | NM | 1,141 | 604 | 190 | 184 | 29 | NM |
Total noninterest income | 8,822 | 7,675 | 15 | 2,680 | 2,227 | 1,906 | 2,009 | 2,099 | 28 |
Noninterest expense | |||||||||
Salaries and employee benefits | 12,146 | 13,584 | (11) | 2,859 | 2,938 | 2,998 | 3,351 | 3,095 | (7.6) |
Occupancy and equipment | 3,716 | 3,884 | (4.3) | 1,014 | 1,242 | 452 | 1,008 | 1,118 | (9.3) |
Information technology | 1,810 | 1,633 | 11 | 469 | 452 | 451 | 438 | 421 | 11 |
Loss on sale of foreclosed assets | 2,538 | 142 | NM | 1,269 | 220 | 885 | 164 | 141 | NM |
Other operating expense | 6,768 | 5,499 | 23 | 1,677 | 1,624 | 1,953 | 1,514 | 1,431 | 17 |
Total noninterest expense | 26,978 | 24,742 | 9.0 | 7,288 | 6,476 | 6,739 | 6,475 | 6,206 | 17 |
Income (loss) before income taxes | 1,084 | 9,176 | (88) | 1,147 | 431 | 26 | (520) | 1,158 | (0.9) |
Income tax expense (benefit) | 155 | 3,170 | (95) | 385 | 85 | (80) | (235) | 380 | 1.3 |
Net income (loss) | $929 | $6,006 | (85) | $762 | $346 | $106 | $(285) | $778 | (2.1) |
Net income (loss) per share: | |||||||||
Basic | $0.16 | $1.01 | (84) | $0.13 | $0.06 | $0.02 | $(0.05) | $0.13 | 0.0 |
Diluted | $0.16 | $1.01 | (84) | $0.13 | $0.06 | $0.02 | $(0.05) | $0.13 | 0.0 |
Average basic shares (000s) | 5,933 | 5,930 | 0.1 | 5,932 | 5,932 | 5,932 | 5,933 | 5,933 | 0.0 |
Average diluted shares (000s) | 5,936 | 5,947 | (0.2) | 5,937 | 5,936 | 5,936 | 5,937 | 5,942 | (0.1) |
Performance Ratios | |||||||||
Return on average equity | 1.16% | 7.60% | (85) | 3.80% | 1.73% | 0.53% | (1.43)% | 3.86% | (1.6) |
Return on average assets | 0.09% | 0.63% | (86) | 0.29% | 0.13% | 0.04% | (0.12)% | 0.31% | (6.5) |
Net interest margin | 3.46% | 3.58% | (3.4) | 3.47% | 3.47% | 3.52% | 3.36% | 3.24% | 7.1 |
Efficiency ratio | 65.60% | 61.98% | 5.8 | 66.28% | 61.87% | 67.46% | 66.93% | 64.42% | 2.9 |
Average equity | 79,804 | 78,998 | 1.0 | 79,459 | 79,302 | 79,606 | 80,873 | 80,138 | (0.8) |
Average assets | 1,018,470 | 960,260 | 6.1 | 1,038,328 | 1,026,871 | 1,005,112 | 1,003,068 | 991,368 | 4.7 |
Average interest-earning assets | 935,617 | 898,295 | 4.2 | 951,258 | 943,236 | 922,073 | 925,531 | 922,642 | 3.1 |
The Savannah Bancorp, Inc. and Subsidiaries | |||||
Selected Financial Condition Highlights – Five-Year Comparison | |||||
($ in thousands, except per share data) | |||||
(Unaudited) | |||||
2009 | 2008 | 2007 | 2006 | 2005 | |
Selected Average Balances | |||||
Assets | $1,018,470 | $960,260 | $869,026 | $769,917 | $685,163 |
Interest-earning assets | 935,617 | 898,295 | 830,900 | 734,470 | 655,632 |
Loans held for sale | -- | 765 | 1,299 | 7,842 | 23,033 |
Loans, net of unearned income | 841,033 | 821,673 | 754,490 | 658,750 | 565,131 |
Securities | 81,282 | 62,019 | 58,910 | 50,600 | 41,300 |
Other interest-earning assets | 13,302 | 13,838 | 16,201 | 17,278 | 26,168 |
Interest-bearing deposits | 777,763 | 701,045 | 628,310 | 542,375 | 487,493 |
Borrowed funds | 71,967 | 88,553 | 70,939 | 62,255 | 55,255 |
Total interest-bearing liabilities | 849,730 | 789,598 | 699,249 | 604,630 | 542,748 |
Noninterest-bearing deposits | 82,406 | 83,678 | 91,367 | 96,113 | 89,386 |
Total deposits | 860,169 | 784,723 | 719,677 | 638,488 | 576,879 |
Shareholders' equity | 79,804 | 78,998 | 71,516 | 61,766 | 47,428 |
Loan to deposit ratio – average | 98% | 105% | 105% | 103% | 98% |
Selected Financial Data at Year-End | |||||
Assets | $1,050,188 | $1,007,284 | $932,459 | $843,514 | $717,901 |
Interest-earning assets | 959,219 | 931,448 | 878,992 | 803,927 | 685,531 |
Loans held for sale | -- | 291 | 180 | 914 | 10,473 |
Loans, net of unearned income | 883,886 | 864,974 | 808,651 | 720,918 | 613,667 |
Deposits | 884,569 | 832,015 | 764,218 | 706,824 | 600,510 |
Interest-bearing liabilities | 883,527 | 837,558 | 759,597 | 669,974 | 558,116 |
Shareholders' equity | 79,026 | 80,932 | 76,272 | 66,574 | 58,543 |
Loan to deposit ratio | 100% | 104% | 106% | 102% | 102% |
Shareholders' equity to total assets | 7.52% | 8.03% | 8.18% | 7.89% | 8.15% |
Dividend payout ratio | 118.19% | 49.38% | 36.73% | 25.92% | 25.53% |
Risk-based capital ratios: | |||||
Tier 1 capital to risk-weighted assets | 10.23% | 10.28% | 10.49% | 11.09% | 11.52% |
Total capital to risk-weighted assets | 11.49% | 11.54% | 11.74% | 12.34% | 12.77% |
Loan Quality Data | |||||
Nonperforming assets | $42,476 | $35,703 | $19,535 | $2,776 | $1,357 |
Nonperforming loans | 34,147 | 27,603 | 17,424 | 2,231 | 1,357 |
Net charge-offs | 8,687 | 5,564 | 765 | 444 | 76 |
Allowance for loan losses | 17,678 | 13,300 | 12,864 | 8,954 | 7,813 |
Allowance for loan losses to total loans | 2.00% | 1.54% | 1.59% | 1.24% | 1.27% |
Nonperforming loans to loans | 3.86% | 3.19% | 2.15% | 0.31% | 0.22% |
Nonperforming assets to total assets | 4.04% | 3.54% | 2.09% | 0.33% | 0.19% |
Net charge-offs to average loans | 1.03% | 0.68% | 0.01% | 0.07% | 0.01% |
Per Share Data at Year-End (a) | |||||
Book value | $13.32 | $13.64 | $12.88 | $11.52 | $10.20 |
Tangible book value | 12.90 | 13.19 | 12.40 | 11.52 | 10.20 |
Common stock closing price (Nasdaq) | 8.00 | 8.85 | 17.14 | 27.25 | 28.38 |
Common shares outstanding (000s) | 5,932 | 5,933 | 5,924 | 5,781 | 5,739 |
(a) Share and per share amounts have been restated to reflect the effect of a 5-for-4 stock split in December 2006. |
The Savannah Bancorp, Inc. and Subsidiaries
Selected Operating Highlights – Five-Year Comparison
($ in thousands, except per share data)
(Unaudited)
2009 | 2008 | 2007 | 2006 | 2005 | |
Summary of operations | |||||
Interest income - taxable equivalent | $ 50,595 | $ 56,714 | $ 63,414 | $ 55,347 | $ 42,544 |
Interest expense | 18,258 | 24,439 | 30,282 | 22,737 | 14,679 |
Net interest income - taxable equivalent | 32,337 | 32,275 | 33,132 | 32,610 | 27,865 |
Taxable equivalent adjustment | (32) | (32) | (156) | (158) | (186) |
Net interest income | 32,305 | 32,243 | 32,976 | 32,452 | 27,679 |
Provision for loan losses | 13,065 | 6,000 | 4,675 | 1,585 | 1,500 |
Net interest income after provision for loan losses |
19,240 | 26,243 | 28,301 | 30,867 | 26,179 |
Noninterest income | |||||
Trust and asset management fees | 2,351 | 2,832 | 1,513 | 658 | 501 |
Service charges on deposit accounts | 1,809 | 1,881 | 1,383 | 1,526 | 1,622 |
Mortgage related income, net | 432 | 295 | 615 | 886 | 1,292 |
Other operating income | 1,238 | 1,216 | 1,242 | 1,233 | 979 |
Gain on hedges | 873 | 1,288 | -- | -- | -- |
Gain on sale of securities | 2,119 | 163 | -- | -- | -- |
Total noninterest income | 8,822 | 7,675 | 4,753 | 4,303 | 4,394 |
Noninterest expense | |||||
Salaries and employee benefits | 12,146 | 13,536 | 11,846 | 10,852 | 9,530 |
Occupancy and equipment | 3,716 | 3,884 | 3,294 | 2,920 | 2,199 |
FDIC deposit insurance | 1,886 | 653 | 251 | 78 | 72 |
Information technology | 1,810 | 1,633 | 1,616 | 1,525 | 1,244 |
Loss on sale of foreclosed assets | 2,538 | 142 | 44 | -- | 7 |
Other operating expense | 4,882 | 4,894 | 4,132 | 4,578 | 3,601 |
Total noninterest expense | 26,978 | 24,742 | 21,183 | 19,953 | 16,653 |
Income before income taxes | 1,084 | 9,176 | 11,871 | 15,217 | 13,920 |
Income tax expense | 155 | 3,170 | 4,235 | 5,215 | 4,880 |
Net income | $929 | $ 6,006 | $ 7,636 | $ 10,002 | $ 9,040 |
Net income per share: (a) | |||||
Basic | $0.16 | $1.01 | $1.31 | $1.73 | $1.68 |
Diluted | $0.16 | $1.01 | $1.29 | $1.70 | $1.63 |
Cash dividends paid per share | $0.185 | $0.50 | $0.48 | $0.45 | $0.43 |
Average basic shares outstanding (000s) | 5,933 | 5,930 | 5,850 | 5,765 | 5,396 |
Average diluted shares outstanding (000s) | 5,936 | 5,947 | 5,922 | 5,876 | 5,531 |
Performance ratios | |||||
Net interest margin | 3.46% | 3.58% | 3.99% | 4.44% | 4.25% |
Return on average assets | 0.09% | 0.63% | 0.88% | 1.30% | 1.32% |
Return on average equity | 1.16% | 7.60% | 10.68% | 16.19% | 19.06% |
Efficiency ratio | 65.60% | 61.98% | 56.15% | 54.29% | 51.92% |
(a)Share and per share amounts have been restated to reflect the effect of a 5-for-4 stock split in December 2006. |
The Savannah Bancorp, Inc. and Subsidiaries | ||||||||
Selected Quarterly Data – 2009 and 2008 | ||||||||
($ in thousands, except per share data) | ||||||||
(Unaudited) | ||||||||
Condensed Quarterly Income Statements | ||||||||
The following is a summary of unaudited quarterly results for 2009 and 2008: | ||||||||
2009 | 2008 | |||||||
Fourth | Third | Second | First | Fourth | Third | Second | First | |
Net interest income | $8,315 | $8,240 | $8,084 | $7,666 | $7,535 | $8,251 | $8,386 | $8,071 |
Provision for loan losses | 2,560 | 3,560 | 3,225 | 3,720 | 2,270 | 1,505 | 1,155 | 1,070 |
Net interest income after provision for loan losses | 5,755 | 4,680 | 4,859 | 3,946 | 5,265 | 6,746 | 7,231 | 7,001 |
Noninterest income | 2,680 | 2,227 | 1,906 | 2,009 | 2,099 | 2,038 | 1,774 | 1,764 |
Noninterest expense | 7,288 | 6,476 | 6,739 | 6,475 | 6,206 | 6,251 | 6,134 | 6,151 |
Income (loss) before income taxes | 1,147 | 431 | 26 | (520) | 1,158 | 2,533 | 2,871 | 2,614 |
Income tax expense (benefit) | 385 | 85 | (80) | (235) | 380 | 895 | 985 | 910 |
Net income (loss) | $762 | $346 | $106 | $(285) | $778 | $1,638 | $1,886 | $1,704 |
Per share: | ||||||||
Net income (loss) – basic | $0.13 | $0.06 | $0.02 | $(0.05) | $0.13 | $0.28 | $0.32 | $0.29 |
Net income (loss) – diluted | $0.13 | $0.06 | $0.02 | $(0.05) | $0.13 | $0.28 | $0.32 | $0.29 |
Dividends | $.020 | $.020 | $.020 | $.125 | $.125 | $.125 | $.125 | $.125 |
Average shares (000s) | ||||||||
Basic | 5,932 | 5,932 | 5,932 | 5,933 | 5,933 | 5,930 | 5,931 | 5,928 |
Diluted | 5,937 | 5,936 | 5,936 | 5,937 | 5,942 | 5,943 | 5,952 | 5,951 |
Quarterly Market Values of Common Shares
The Company's common stock was sold in an initial public offering on April 10, 1990. It is traded on the NASDAQ Global Market under the symbol SAVB. The quarterly high, low and closing stock trading prices for 2009 and 2008 are listed below. There were approximately 640 holders of record of Company Common Stock and, according to information available to the Company, approximately 1,150 additional shareholders in street name through brokerage accounts at December 31, 2009.
2009 | 2008 | |||||||
Closing Market Prices | Fourth | Third | Second | First | Fourth | Third | Second | First |
High | $9.25 | $8.50 | $10.93 | $10.00 | $13.35 | $15.00 | $18.73 | $18.49 |
Low | 7.00 | 6.65 | 6.65 | 6.00 | 8.57 | 11.89 | 12.75 | 15.76 |
Close | 8.00 | 8.10 | 6.65 | 7.01 | 8.85 | 13.25 | 13.00 | 17.50 |
The Savannah Bancorp, Inc. and Subsidiaries | ||||||
Allowance for Loan Losses and Nonperforming Loans | ||||||
(Unaudited) | ||||||
2009 | 2008 | |||||
Fourth | Third | Second | First | Fourth | ||
($ in thousands) | Quarter | Quarter | Quarter | Quarter | Quarter | |
Allowance for loan losses | ||||||
Balance at beginning of period | $ 16,880 | $ 15,597 | $ 15,309 | $ 13,300 | $ 12,390 | |
Provision for loan losses | 2,560 | 3,560 | 3,225 | 3,720 | 2,270 | |
Net charge-offs | (1,762) | (2,277) | (2,937) | (1,711) | (1,360) | |
Balance at end of period | $ 17,678 | $ 16,880 | $ 15,597 | $ 15,309 | $ 13,300 | |
As a % of loans | 2.00% | 1.95% | 1.81% | 1.77% | 1.54% | |
As a % of nonperforming loans | 51.77% | 64.92% | 56.99% | 63.27% | 48.18% | |
As a % of nonperforming assets | 41.62% | 46.56% | 46.22% | 47.05% | 37.25% | |
Net charge-offs as a % of average loans (a) | 0.83% | 1.07% | 1.41% | 0.82% | 0.65% | |
Risk element assets | ||||||
Nonaccruing loans | $ 32,545 | $ 25,694 | $ 24,994 | $ 23,927 | $ 26,277 | |
Loans past due 90 days – accruing | 1,602 | 307 | 2,374 | 268 | 1,326 | |
Total nonperforming loans | 34,147 | 26,001 | 27,368 | 24,195 | 27,603 | |
Other real estate owned | 8,329 | 10,252 | 6,377 | 8,342 | 8,100 | |
Total nonperforming assets | $ 42,476 | $ 36,253 | $ 33,745 | $ 32,537 | $ 35,703 | |
Loans past due 30-89 days | $ 5,182 | $ 8,122 | $ 6,670 | $ 16,906 | $ 8,269 | |
Nonperforming loans as a % of loans | 3.86% | 3.00% | 3.17% | 2.80% | 3.19% | |
Nonperforming assets as a % of loans | ||||||
and other real estate owned | 4.76% | 4.13% | 3.88% | 3.73% | 4.09% | |
Nonperforming assets as a % of assets | 4.04% | 3.48% | 3.31% | 3.25% | 3.54% | |
(a) Annualized |
The Savannah Bancorp, Inc. and Subsidiaries
Regulatory Capital Ratios
The banking regulatory agencies of The Savannah Bancorp, Inc. and Subsidiary Banks have adopted capital requirements that specify the minimum level for which no prompt corrective action is required. In addition, the Federal Deposit Insurance Corporation ("FDIC") has adopted FDIC insurance assessment rates based on certain "well-capitalized" risk-based and equity capital ratios. Failure to meet minimum capital requirements can result in the initiation of certain actions by the regulators that, if undertaken, could have a material effect on the Company's and the Subsidiary Banks' financial statements. The following table shows the capital ratios for the Company and the Subsidiary Banks at December 31, 2009 and 2008:
($ in thousands) | Company | Savannah | Bryan | |||
2009 | 2008 | 2009 | 2008 | 2009 | 2008 | |
Qualifying Capital | ||||||
Tier 1 capital | $85,443 | $85,356 | $60,461 | $54,665 | $21,672 | $20,553 |
Total capital | 95,970 | 95,767 | 68,076 | 61,434 | 24,261 | 23,176 |
Leverage Ratios | ||||||
Tier 1 capital to average assets | 8.23% | 8.61% | 7.93% | 8.39% | 8.57% | 8.62% |
Risk-based Ratios | ||||||
Tier 1 capital to risk-weighted assets | 10.23% | 10.28% | 9.95% | 10.13% | 10.48% | 9.80% |
Total capital to risk-weighted assets | 11.49% | 11.54% | 11.20% | 11.38% | 11.74% | 11.05% |
Following are the regulatory capital ratios minimum ratio and the minimum ratios to be classified as a well-capitalized holding company or bank:
Well- | ||
Regulatory Capital Guidelines: | Capitalized | Minimum |
Tier 1 capital to average assets | 5.00% | 4.00% |
Tier 1 capital to risk-weighted assets | 6.00% | 4.00% |
Total capital to risk-weighted assets | 10.00% | 8.00% |
Loan Concentration Schedule
% of | % of | % Dollar | |||
($ in thousands) | 12/31/09 | Total | 12/31/08 | Total | Change |
Non-residential real estate | |||||
Owner-occupied | $ 137,439 | 16 | $ 137,742 | 16 | (0.2) |
Non owner-occupied | 159,091 | 18 | 124,502 | 14 | 28 |
Construction | 5,352 | 1 | 26,965 | 3 | (80) |
Commercial land and lot development | 47,080 | 5 | 42,590 | 5 | 11 |
Total non-residential real estate | 348,962 | 40 | 331,799 | 38 | 5.2 |
Residential real estate | |||||
Owner-occupied – 1-4 family | 95,741 | 11 | 89,774 | 10 | 6.6 |
Non owner-occupied – 1-4 family | 158,172 | 18 | 147,396 | 17 | 7.3 |
Construction | 27,061 | 3 | 43,431 | 5 | (38) |
Residential land and lot development | 92,346 | 10 | 98,715 | 12 | (6.5) |
Home equity lines | 57,527 | 6 | 55,092 | 6 | 4.4 |
Total residential real estate | 430,847 | 48 | 434,408 | 50 | (0.8) |
Total real estate loans | 779,809 | 88 | 766,207 | 88 | 1.8 |
Commercial | 89,379 | 10 | 81,348 | 10 | 9.9 |
Consumer | 14,971 | 2 | 17,628 | 2 | (15) |
Unearned fees, net | (273) | -- | (209) | -- | 31 |
Total loans, net of unearned fees | $ 883,886 | 100 | $ 864,974 | 100 | 2.2 |
The Savannah Bancorp, Inc. and Subsidiaries
Average Balance Sheet and Rate/Volume Analysis - 2009 and 2008
Taxable-Equivalent | (a) Variance | ||||||||
Average Balance | Average Rate | Interest (b) | Vari- | Attributable to | |||||
2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ance | Rate | Volume | |
($ in thousands) | (%) | ($ in thousands) | ($ in thousands) | ||||||
Assets | |||||||||
$5,963 | $ 7,033 | 0.75 | 2.11 | Interest-bearing deposits | $45 | $149 | $ (104) | $ (96) | $ (8) |
77,844 | 60,136 | 4.20 | 4.98 | Investments - taxable | 3,273 | 3,002 | 271 | (469) | 740 |
3,438 | 1,883 | 4.94 | 5.46 | Investments - non-taxable | 170 | 103 | 67 | (10) | 77 |
7,339 | 6,805 | 0.25 | 1.95 | Federal funds sold | 18 | 133 | (115) | (116) | 1 |
-- | 765 | -- | 7.82 | Loans held for sale | -- | 60 | (60) | -- | (60) |
841,033 | 821,673 | 5.60 | 6.47 | Loans (c) | 47,089 | 53,267 | (6,178) | (7,149) | 971 |
935,617 | 898,295 | 5.41 | 6.30 | Total interest-earning assets | 50,595 | 56,714 | (6,119) | (7,995) | 1,876 |
82,853 | 61,965 | Noninterest-earning assets | |||||||
$1,018,470 | $960,260 | Total assets | |||||||
Liabilities and equity | |||||||||
Deposits | |||||||||
$123,715 | $120,661 | 0.46 | 1.15 | NOW accounts | 572 | 1,396 | (824) | (833) | 9 |
16,071 | 15,488 | 0.65 | 0.88 | Savings accounts | 104 | 137 | (33) | (36) | 3 |
131,402 | 128,826 | 1.74 | 2.38 | Money market accounts | 2,281 | 3,079 | (798) | (824) | 26 |
86,044 | 68,464 | 1.48 | 2.66 | MMA - institutional | 1,272 | 1,827 | (555) | (808) | 253 |
157,923 | 147,576 | 3.32 | 4.52 | CDs, $100M or more | 5,239 | 6,685 | (1,446) | (1,771) | 325 |
117,120 | 85,790 | 2.01 | 3.49 | CDs, broker | 2,356 | 2,998 | (642) | (1,270) | 628 |
145,488 | 134,240 | 3.18 | 4.25 | Other time deposits | 4,630 | 5,720 | (1,090) | (1,436) | 346 |
777,763 | 701,045 | 2.12 | 3.11 | Total interest-bearing deposits | 16,454 | 21,842 | (5,388) | (6,940) | 1,552 |
47,675 | 67,979 | 2.39 | 2.44 | Short-term borrowings | 1,140 | 1,661 | (521) | (34) | (487) |
13,982 | 10,264 | 2.16 | 2.86 | FHLB advances – long-term | 302 | 294 | 8 | (72) | 80 |
10,310 | 10,310 | 3.51 | 6.21 | Subordinated debt | 362 | 642 | (280) | (278) | (2) |
Total interest-bearing | |||||||||
849,730 | 789,598 | 2.15 | 3.09 | liabilities | 18,258 | 24,439 | (6,181) | (7,422) | 1,241 |
82,406 | 83,678 | Noninterest-bearing deposits | |||||||
6,530 | 7,986 | Other liabilities | |||||||
79,804 | 78,998 | Shareholders' equity | |||||||
$1,018,470 | $960,260 | Liabilities and equity | |||||||
3.26 | 3.21 | Interest rate spread | |||||||
3.46 | 3.58 | Net interest margin | |||||||
Net interest income | $32,337 | $32,275 | $ 62 | $(573) | $ 635 | ||||
$85,887 | $108,697 | Net earning assets | |||||||
$860,169 | $784,723 | Average deposits | |||||||
1.91 | 2.78 | Average cost of deposits | |||||||
98% | 105% | Average loan to deposit ratio |
(a) This table shows the changes in interest income and interest expense for the comparative periods based on either changes in average volume or changes in average rates for interest-earning assets and interest-bearing liabilities.Changes which are not solely due to rate changes or solely due to volume changes are attributed to volume. | ||||||||
(b) The taxable equivalent adjustment results from tax exempt income less non-deductible TEFRA interest expense and was $32 in 2009 and 2008. | ||||||||
(c) Average nonaccruing loans have been excluded from total average loans and categorized in noninterest-earning assets. |
The Savannah Bancorp, Inc. and Subsidiaries
Average Balance Sheet and Rate/Volume Analysis – Fourth Quarter, 2009 and 2008
Taxable-Equivalent | (a) Variance | ||||||||
Average Balance | Average Rate | Interest (b) | Attributable to | ||||||
QTD | QTD | QTD | QTD | QTD | QTD | Vari- | |||
2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ance | Rate | Volume | |
($ in thousands) | (%) | ($ in thousands) | ($ in thousands) | ||||||
Assets | |||||||||
$6,732 | $9,998 | 0.53 | 0.71 | Interest-bearing deposits | $9 | $18 | $(9) | $(5) | $ (4) |
81,189 | 67,557 | 3.04 | 4.70 | Investments - taxable | 622 | 800 | (178) | (283) | 105 |
6,677 | 1,792 | 4.28 | 5.09 | Investments - non-taxable | 72 | 23 | 49 | (4) | 53 |
10,535 | 7,366 | 0.23 | 0.86 | Federal funds sold | 6 | 16 | (10) | (12) | 2 |
-- | 159 | -- | 19.96 | Loans held for sale | -- | 8 | (8) | -- | (8) |
846,125 | 835,770 | 5.53 | 5.82 | Loans (c) | 11,795 | 12,270 | (475) | (611) | 136 |
951,258 | 922,642 | 5.22 | 5.65 | Total interest-earning assets | 12,504 | 13,135 | (631) | (1,000) | 369 |
87,070 | 68,726 | Noninterest-earning assets | |||||||
$1,038,328 | $991,368 | Total assets | |||||||
Liabilities and equity | |||||||||
Deposits | |||||||||
$127,193 | $127,757 | 0.40 | 0.79 | NOW accounts | 129 | 254 | (125) | (126) | 1 |
16,563 | 14,636 | 0.50 | 0.89 | Savings accounts | 21 | 33 | (12) | (14) | 2 |
152,898 | 106,073 | 1.67 | 2.06 | Money market accounts | 645 | 550 | 95 | (104) | 199 |
74,627 | 81,776 | 1.13 | 2.26 | MMA - institutional | 212 | 466 | (254) | (233) | (21) |
163,595 | 143,900 | 2.89 | 4.05 | CDs, $100M or more | 1,193 | 1,468 | (275) | (421) | 146 |
115,520 | 107,637 | 1.38 | 3.11 | CDs, broker | 402 | 843 | (441) | (469) | 28 |
151,359 | 142,450 | 2.75 | 3.77 | Other time deposits | 1,050 | 1,355 | (305) | (366) | 61 |
801,755 | 724,229 | 1.81 | 2.72 | Total interest-bearing deposits | 3,652 | 4,969 | (1,317) | (1,661) | 344 |
40,162 | 73,959 | 3.66 | 2.00 | Short-term borrowings | 370 | 372 | (2) | 309 | (311) |
15,664 | 11,609 | 2.10 | 2.73 | FHLB advances – long-term | 83 | 80 | 3 | (18) | 21 |
10,310 | 10,310 | 2.92 | 6.58 | Subordinated debt | 76 | 171 | (95) | (95) | -- |
Total interest-bearing | |||||||||
867,891 | 820,107 | 1.91 | 2.71 | liabilities | 4,181 | 5,592 | (1,411) | (1,654) | 243 |
84,320 | 83,506 | Noninterest-bearing deposits | |||||||
6,658 | 7,617 | Other liabilities | |||||||
79,459 | 80,138 | Shareholders' equity | |||||||
$1,038,328 | $991,368 | Liabilities and equity | |||||||
3.31 | 2.94 | Interest rate spread | |||||||
3.47 | 3.24 | Net interest margin | |||||||
Net interest income | $8,323 | $7,543 | $ (780) | $654 | $ 126 | ||||
$ 83,367 | $102,535 | Net earning assets | |||||||
$886,075 | $807,735 | Average deposits | |||||||
1.64 | 2.44 | Average cost of deposits | |||||||
95% | 103% | Average loan to deposit ratio |
(a) This table shows the changes in interest income and interest expense for the comparative periods based on either changes in average volume or changes in average rates for interest-earning assets and interest-bearing liabilities. Changes which are not solely due to rate changes or solely due to volume changes are attributed to volume.
(b) The taxable equivalent adjustment results from tax exempt income less non-deductible TEFRA interest expense and was $8 in the fourth quarter 2009 and 2008, respectively.
(c) Average nonaccruing loans have been excluded from total average loans and categorized in noninterest-earning assets.
Consolidated Statements of Shareholders' Equity | |||
For the Three Years Ended December 31, 2009 | |||
($ in thousands, except share data) | |||
December 31, | |||
2009 | 2008 | 2007 | |
Common shares issued | |||
Shares, beginning of year | 5,933,789 | 5,923,797 | 5,781,381 |
Common stock issued | -- | 6,211 | 78,000 |
Exercise of options | -- | 3,781 | 64,416 |
Shares, end of year | 5,933,789 | 5,933,789 | 5,923,797 |
Treasury shares owned | |||
Shares, beginning of year | 318 | 318 | 318 |
Unvested restricted stock | 1,125 | -- | -- |
Shares, end of year | 1,443 | 318 | 318 |
Common stock | |||
Balance, beginning of year | $5,934 | $5,924 | $5,781 |
Common stock issued | -- | 6 | 78 |
Exercise of options | -- | 4 | 65 |
Balance, end of year | 5,934 | 5,934 | 5,924 |
Additional paid-in capital | |||
Balance, beginning of year | 38,516 | 38,279 | 35,747 |
Common stock issued, net of issuance costs | -- | 68 | 1,702 |
Stock-based compensation, net | 89 | 137 | 147 |
Exercise of options | -- | 32 | 683 |
Balance, end of year | 38,605 | 38,516 | 38,279 |
Retained earnings | |||
Balance, beginning of year | 33,552 | 30,512 | 25,681 |
Net income | 929 | 6,006 | 7,636 |
Dividends paid | (1,098) | (2,966) | (2,805) |
Balance, end of year | 33,383 | 33,552 | 30,512 |
Treasury stock | |||
Balance, beginning and end of year | (4) | (4) | (4) |
Accumulated other comprehensive income (loss), net | |||
Balance, beginning of year | 2,934 | 1,561 | (631) |
Change in unrealized gains/losses on securities | |||
available for sale, net of tax | (531) | 842 | 662 |
Change in fair value and gains on termination of derivative | |||
instruments, net of tax | (1,295) | 531 | 1,530 |
Balance, end of year | 1,108 | 2,934 | 1,561 |
Total shareholders' equity | $79,026 | $80,932 | $76,272 |