-- Capital ratios remain in excess of all minimums required to be "Well Capitalized" by regulatory agencies, with a Tier 1 Leverage Ratio of 16.5% and a Total Risk-Based Capital Ratio of 23.5% at September 30, 2010. Regulatory "Well Capitalized" definitions are 5% for the Tier 1 Leverage Ratio and 10% for the Total Risk-Based Capital Ratio. -- Total Assets at September 30, 2010 grew to $113.6 million, an increase of $25.1 million or 28% from September 30, 2009. -- Total Deposits at September 30, 2010 grew to $94.4 million, an increase of $26.4 million or 39% from September 30, 2009. -- Total Loans at September 30, 2010 grew to $74.0 million, an increase of $1.5 million or 2% from September 30, 2009. -- Operating income showed great improvement over last year. The Net Loss was $82,000 for the quarter ended September 30, 2010 versus net income of $316,000 for the comparable period of 2009. The 2009 income included the successful resolution of a lawsuit with a payment of $1.1 million to the Bank. Excluding the $1.1 million, the Bank's quarterly loss in 2009 was $794,000.PROMÉRICA BANK reported a net loss of $82,000 for the third quarter of 2010 ($0.03 per share) as compared to net income of $316,000 ($0.11 per share) in the third quarter of 2009. The Bank reported a net loss of $524,000 ($0.19 per share) in the first nine months of 2010 as compared to a loss of $1,395,000 ($0.51 per share) in the first nine months of 2009. The results for both of the 2009 periods included the successful resolution of a lawsuit with a payment of $1.1 million to the Bank in September 2009. The 2010 results include gains on the sale of SBA loans totaling $116,000 and $206,000 for the three and nine-month periods, respectively. The Allowance for Loan and Lease Losses represents 2.8% of total loans at September 30, 2010. Nonperforming assets, net of government guaranteed loans, totaled approximately $1.2 million, or 1.1% of assets at September 30, 2010. "PROMÉRICA BANK continues to make progress with strong growth in assets, core deposits, income and good credit management despite a challenging economy," stated John H. Quinn, President and CEO of PROMÉRICA BANK. "We continue to grow in our core markets by providing excellent client service and demonstrating the advantages of bank-client partnerships to help our clients grow and expand their companies. PROMÉRICA BANK continues to lend and offers its clients security knowing that our capital is well in excess of regulatory requirements and that we provide FDIC insurance to the maximum allowed by law. We believe our strength and stability, combined with our commitment to building wealth for entrepreneurs, families and community makes us an attractive financial partner." "Despite the recent turbulence in the banking industry, a sluggish economy and our de novo status, the Directors and I are delighted to report that PROMÉRICA BANK continues to fulfill its mission as a solid lending institution in the community," stated Maria Contreras-Sweet, Executive Chairwoman. "As we approach our fourth anniversary, the Directors and I are delighted with the Bank's progress, performance and overall health. We are now well positioned to expand our banking franchise through our consultative approach, community focus and strong capital position. We recognize that during these challenging economic times, our commitment to our mission of providing capital to businesses, non profits and professionals is as critical now as ever to ensuring job growth and economic expansion. We acknowledge the many corporations, foundations and government agencies who have established a relationship with PROMÉRICA BANK to enhance our ability to provide capital to the community," added Ms. Contreras-Sweet. "PROMÉRICA BANK continues to be recognized as a national leader in creating opportunities for all people. The Reverend Jesse L. Jackson, Sr. recently recognized our commitment and impact by honoring us with the Bridge Builder Award at Rainbow PUSH Coalition's and Citizenship Education Fund's 12th Annual Awards Dinner," concluded Ms. Contreras-Sweet. PROMÉRICA BANK provides a full range of financial services, including credit and deposit products, cash management, and internet banking for businesses and high net worth individuals from its headquarters office at 888 S. Figueroa Street, Los Angeles, CA 90017. Information on products and services may be obtained by calling (213) 613-5000 or visiting the Bank's website at www.PROMERICAbank.com. NOTE: This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about PROMÉRICA BANK's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and the following: PROMÉRICA BANK's timely implementation of new products and services, technological changes, changes in consumer spending and savings habits and other risks discussed from time to time in PROMÉRICA BANK's reports and filings with banking regulatory agencies. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and PROMÉRICA BANK does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
PROMÉRICA BANK BALANCE SHEETS
(Dollars in thousands)
September December September
30, June 30, 31, 30,
2010 2010 2009 2009
--------- --------- --------- ---------
Unaudited Unaudited Audited Unaudited
Assets:
Cash and Due From Banks $ 824 $ 2,741 $ 3,930 $ 3,971
Federal Funds Sold 28,650 26,205 11,875 6,960
Interest-bearing Balances at
Other Financial Institutions 9,659 9,417 3,841 4,844
--------- --------- --------- ---------
Total Cash and Cash
Equivalents 39,133 38,363 19,646 15,775
--------- --------- --------- ---------
Loans Net of Deferred Loan
Fees/Costs 73,992 70,311 75,315 72,461
Allowance for Loan Losses 2,051 2,040 2,030 1,519
--------- --------- --------- ---------
Loans Net of Allowance for
Loan Losses 71,941 68,271 73,285 70,942
Premises and Equipment, net 496 594 788 872
Federal Home Loan Bank Stock 364 364 232 232
Other Real Estate Owned 357 390 0 0
Accrued Interest Receivable
and Other Assets 1,345 1,257 1,403 689
--------- --------- --------- ---------
Total Assets $ 113,636 $ 109,239 $ 95,354 $ 88,510
--------- --------- --------- ---------
Liabilities:
Non-Interest-Bearing Demand
Deposits $ 26,443 $ 22,760 $ 17,134 $ 15,118
Interest-Bearing Demand
Deposits (NOW Deposits) 14,447 6,328 2,963 2,815
Savings and Money Market 14,591 17,525 13,834 16,593
Certificates of Deposit 38,906 42,298 42,245 33,436
--------- --------- --------- ---------
Total Interest-Bearing
Deposits 67,944 66,151 59,042 52,844
--------- --------- --------- ---------
Total Deposits 94,387 88,911 76,176 67,962
Other Borrowings 293 1,296 0 0
Accrued Interest Payable and
Other Liabilities 556 617 464 543
--------- --------- --------- ---------
Total Liabilities 95,236 90,824 76,640 68,505
Shareholders' Equity:
Common Stock 27,245 27,245 27,245 27,245
Additional Paid in Capital 1,381 1,314 1,170 1,103
Accumulated Deficit (10,226) (10,144) (9,701) (8,343)
--------- --------- --------- ---------
Total Shareholders' Equity 18,400 18,415 18,714 20,005
--------- --------- --------- ---------
Total Liabilities and
Shareholders' Equity $ 113,636 $ 109,239 $ 95,354 $ 88,510
--------- --------- --------- ---------
Tier 1 Leverage Ratio 16.5% 18.0% 21.0% 24.8%
Tier 1 Risk-based Capital
Ratio 22.3% 23.7% 25.0% 27.4%
Total Risk-based Capital Ratio 23.5% 25.0% 26.2% 28.6%
PROMÉRICA BANK STATEMENTS OF OPERATIONS
For the Quarters Indicated
(Dollars in thousands except per share data)
September December September
30, June 30, 31, 30,
2010 2010 2009 2009
--------- --------- --------- ----------
Unaudited Unaudited Audited Unaudited
Interest Income:
Interest and Fees on Loans $ 1,149 $ 1,138 $ 1,203 $ 1,103
Interest on Federal Funds Sold 19 14 5 3
Interest on Balances at Other
Financial Institutions 31 29 18 18
Dividends on FHLB and PCBB
Stock 0 0 0 1
--------- --------- --------- ----------
Total Interest Income 1,199 1,181 1,226 1,125
Interest Expense:
Interest on Deposit Accounts 108 126 138 130
--------- --------- --------- ----------
Net Interest Income 1,091 1,055 1,088 995
Provision for Loan Losses 0 0 1,181 554
--------- --------- --------- ----------
Net Interest Income After
Provision for Loan Losses 1,091 1,055 (93) 441
Non-Interest Income:
Non-Interest Income 129 103 30 1,131
Non-Interest Expense:
Salaries and Employee Benefits 693 623 713 737
Stock Based Compensation
Expense 67 76 68 46
Occupancy Expense 222 221 226 228
Operating Expense 320 362 288 245
--------- --------- --------- ----------
Total Non-Interest Expense 1,302 1,282 1,295 1,256
Net Income (Loss) from Bank
Operations (82) (124) (1,358) 316
--------- --------- --------- ----------
Pre-tax Net Income (Loss) (82) (124) (1,358) 316
Provision for Income Taxes 0 1 1 0
Net Income (Loss) $ (82) $ (125) $ (1,359) $ 316
--------- --------- --------- ----------
Income (Loss) per share -
basic and diluted loss
per share $ (0.03) $ (0.05) $ (0.49) $ 0.11
--------- --------- --------- ----------
PROMÉRICA BANK STATEMENTS OF OPERATIONS
For the Nine-Month Periods Indicated
(Dollars in thousands except per share data)
September September
30, 30,
2010 2009
--------- ---------
Unaudited Unaudited
Interest Income:
Interest and Fees on Loans $ 3,475 $ 2,953
Interest on Federal Funds Sold 41 11
Interest on Balances at Other Financial Institutions 84 70
Dividends on FHLB and PCBB Stock 1 6
--------- ---------
Total Interest Income 3,601 3,040
Interest Expense:
Interest on Deposit Accounts 379 440
--------- ---------
Net Interest Income 3,222 2,600
Provision for Loan Losses 62 1,190
--------- ---------
Net Interest Income After Provision for Loan Losses 3,160 1,410
Non-Interest Income:
Non-Interest Income 264 1,198
Non-Interest Expense:
Salaries and Employee Benefits 2,053 2,264
Stock Based Compensation Expense 210 199
Occupancy Expense 661 685
Operating Expense 1,023 855
--------- ---------
Total Non-Interest Expense 3,947 4,003
Net Loss from Bank Operations (523) (1,395)
--------- ---------
Pre-tax Net Loss (523) (1,395)
Provision for Income Taxes 1 0
Net Loss $ (524) $ (1,395)
--------- ---------
Loss per share - basic and diluted loss per share $ (0.19) $ (0.51)
--------- ---------
Contact Information: Contact: PROMERICA BANK Maria Contreras-Sweet Chairwoman 213.787.2802 John H. Quinn CEO / President 213.787.2803 Frank E. Smith CFO 213.787.2804