MORRISTOWN, Tenn., Feb. 6, 2008 (PRIME NEWSWIRE) -- Community National Bank of the Lakeway Area (Nasdaq:CNLA) today reported results for the fourth quarter and year ended December 31, 2007. Net income for the quarter was $708 thousand, or $0.38 per basic and diluted share, compared with a $120 thousand, or $0.07 per basic and diluted share for the same prior year period. Year-to-date net income was $1.1 million or $0.59 per basic and diluted share as compared to $161 thousand or $0.09 per basic and diluted share for the prior year period. Highlights for the year of 2007 include:
* Community National Bank completed its second profitable year in
2007 with a return on average assets of 1.03% compared to 0.16%
for the year ended December 31, 2006. The return on average
equity for the year ended December 31, 2007 was 7.23% compared to
1.82% for 2006.
* The strong earnings increase in the fourth quarter of 2007 was due
to the recognition of a portion of the deferred tax benefit
created primarily by net operating loss carry forwards in previous
years. The Bank recognized approximately 53% of the benefit or
$655 thousand during 2007. A valuation allowance for the balance
of the deferred tax benefit will be maintained until management
determines it is more likely than not that future earnings will be
sufficient to use the tax benefit in the required time frame.
* Net interest income for the quarter and year ended December 31,
2007 was $934 thousand and $3.6 million respectively, compared to
$820 thousand and $3.0 million for the quarter and year ended
December 31, 2006, respectively. The net interest margin for the
quarter and year ended December 31, 2007 was 3.74% and 3.64%,
respectively, as compared to 3.39% and 3.14% for the same periods
in 2006.
* Gross loans grew 5.6% for the twelve-month period from $73.0
million at December 31, 2006 to $77.1 million at December 31,
2007. The majority of the loan growth was in construction and
land development loans which increased 30.2% and residential real
estate loans which increased 6.6%.
* Deposits for the year ended December 31, 2007 declined 3.6% to
73.1 million from $75.8 million at December 31, 2006. This decline
is attributable primarily to the banks conservative pricing
strategies as well as the lack of convenient branch locations for
the Hamblen County market.
On January 28, 2008, the Bank opened a branch office located in a high traffic area in west Morristown. The added convenience provided by this branch, along with the experienced local staff, should spur future deposit growth.
Samuel F. Grigsby, Jr. CEO of Community National Bank of the Lakeway Area, commented, "The fourth quarter of 2007 and the entire year was very positive for our Bank. Now that we have established steady, consistent earnings, we should be able to execute our business plan and place branches in strategic locations, thus enabling us to grow, become more efficient, and increase earnings. Our net interest margin continues to improve, and that can only be a positive for future earnings. While 2008 may not be the greatest of years for the banking industry as a whole, I believe we are positioned well for the next rise in the economic cycle. Our markets remain strong, and we have not been affected as negatively as other parts of the country. It feels good to have established this earnings trend, and I think brighter days are ahead for our Bank."
This press release contains forward-looking statements concerning Community National Bank of the Lakeway Area's future activities. Such statements are subject to important factors that could cause Community National Bank of the Lakeway Area's actual results to differ materially from those anticipated by the forward-looking statements. These factors include the factors identified in Community National Bank of the Lakeway Area's Annual Report on Form 10-KSB for the year ended December 31, 2006 under the heading "Risk Factors" which are incorporated herein by reference.
Community National Bank of the Lakeway Area
Financial Highlights
(Unaudited)
Three-Months Ended Year Ended
December 31, December 31,
2007 2006 % Change 2007 2006 % Change
-------------------------- --------------------------
All dollars in thousands except per share data
EARNINGS
Net interest
income $ 934 $ 820 13.9% $ 3,622 $ 2,965 22.2%
Provision for
loan losses 7 60 -88.3% 96 209 -54.1%
Noninterest
income 104 129 -19.4% 403 317 27.1%
Noninterest
expense 978 769 27.2% 3,507 2,912 20.4%
Income tax
benefit 655 -- 100.0% 655 -- 100.0%
Net income 708 120 490.0% 1,077 161 569.2%
PER SHARE
INFORMATION
Earnings per
share, basic $ 0.38 $ 0.07 468.5% $ 0.59 $ 0.09 558.9%
Dividends per
share -- -- -- -- -- --
Book value per
share 8.63 7.89 9.4% 8.63 7.89 9.4%
OPERATING
RATIOS (1)
Net interest
margin 3.74% 3.39% 3.64% 3.14%
Return on
average assets 2.69% 0.47% 1.03% 0.16%
Return on
average equity 18.10% 3.38% 7.24% 1.82%
Efficiency
ratio 94.2% 81.0% 87.1% 88.7%
Net charge
offs / average
loans 0.00% 0.01% 0.17% 0.04%
AVERAGE
BALANCES
Loans $ 76,951 $ 67,555 13.9% $ 74,921 $ 61,444 21.9%
Total earning
assets 99,885 96,813 3.2% 99,488 94,484 5.3%
Total assets 105,154 102,356 2.7% 104,450 98,896 5.6%
Deposits 73,805 73,883 -0.1% 74,910 77,789 -3.7%
Borrowed funds 15,178 13,658 11.1% 14,072 11,735 19.9%
Stockholders'
equity 15,647 14,206 10.1% 14,886 8,864 67.9%
As of December 31, %
END OF PERIOD BALANCES 2007 2006 Change
----------------------------
Loans $ 77,051 $ 72,971 5.6%
Reserve for loan losses 702 734 -4.4%
Total earning assets 100,695 98,922 1.8%
Total assets 106,519 104,348 2.1%
Deposits 73,125 75,823 -3.6%
Borrowed funds 16,471 13,631 20.8%
Stockholders' equity 16,327 14,300 14.2%
ASSET QUALITY (END OF
PERIOD)
Loans 90 days past due and
still accruing $ -- $ 17
Nonaccrual loans 20 295
Foreclosed assets 505 --
-------------------
Total nonperforming assets $ 525 $ 312
Nonperforming assets /
total assets 0.49% 0.30%
Allowance for loan losses /
total loans 0.91% 1.01%
(1) Net income has been annualized for the quarterly calculations
and assumes the same net income result for each quarter.