FORT WORTH, Texas, Jan. 23 /PRNewswire-FirstCall/ -- Summit
Bancshares, Inc. (NASDAQ:SBIT), a bank holding company for Summit
Bank, N.A., today reported net income of $3,516,000, or $0.28 per
diluted common share for the fourth quarter of 2005, compared to
$2,919,000, or $0.23 per diluted common share, for the comparable
2004 period, a 21.7% increase. Return on average assets and return
on average shareholders' equity for the fourth quarter were 1.29%
and 17.29%, respectively, compared to 1.18% and 15.58%,
respectively, for the corresponding 2004 period. For the year ended
December 31, 2005, net income totaled $13,176,000, or $1.04 per
diluted common share, compared to $10,762,000, or $0.85 per diluted
common share, for the year of 2004, a 22.4% increase. Return on
average assets and return on average shareholders' equity were
1.28% and 16.89%, respectively, for the year ended December 31,
2005, compared to 1.16% and 15.04%, respectively, for the year of
2004. Philip E. Norwood, Chairman, President and Chief Executive
Officer, stated, "We are very pleased with the earnings and growth
performance for the fourth quarter and for the year of 2005. The
Summit Bancshares/Summit Bank team of employees has worked very
hard to make this such a successful year and they are to be
commended for their efforts. The team and I are looking forward to
a very productive and exciting 2006." Net interest income (tax
equivalent) of $12.1 million for the fourth quarter 2005 improved
$1.8 million, or 17.8%, over fourth quarter 2004. Average total
interest earning assets increased 10.0% from fourth quarter 2004 to
$1.0 billion for fourth quarter 2005. The net interest margin, on a
taxable-equivalent basis, on average total interest earning assets
increased 30 basis points to 4.71% for the fourth quarter 2005
compared to the corresponding 2004 quarter. For the year ended
December 31, 2005, net interest income totaled $44.4 million,
reflecting a $6.9 million, or 18.3%, increase from the year of
2004. This increase resulted primarily from an increase of 11.3% in
average total interest earning assets to $968 million for the year
of 2005. Also, the net interest margin, on a taxable-equivalent
basis, on average total interest earning assets increased 27 basis
points to 4.58% for the year ended December 31, 2005 compared to
the prior year, reflecting rising interest rates in the market. Net
interest margin has increased each quarter of 2005 over that of the
immediately preceding quarter, again reflecting rising interest
rates. A provision for loan losses of $340,000 for the fourth
quarter 2005 was 17.2% greater than the provision for loan losses
of $290,000 for the fourth quarter of 2004 primarily reflecting
loan growth. Net charge-offs totaled $263,000 for the fourth
quarter 2005, representing net charge-offs to average loans for the
quarter of 0.03%. As of December 31, 2005, the allowance for loan
losses as a percentage of total loans was 1.45%, the same rate as
of December 31, 2004. For the year ended December 31, 2005, the
provision for loan losses totaled $1,105,000, a $685,000 decrease
compared to the provision for the prior year primarily driven by
lack of loan charge-offs in 2005. Net charge-offs for the year were
only $84,000, or 0.01%, of average loans. Non-interest income of
$1,913,000 for fourth quarter 2005 increased 5.6% over fourth
quarter 2004. Service charges on deposits amounted to $974,000 for
fourth quarter 2005, a decrease of 10.1% primarily due to higher
interest earnings credits paid on commercial deposit accounts that
are under account analysis for charges. Included in the increase
for other income of $212,000 for the fourth quarter of 2005 over
the fourth quarter of 2004 were the following: a) an increase of
$149,000 in fee income from investment services due to the addition
of Summit Financial Partners in March; b) an increase of $53,000 in
fees for trust services partly due to the addition of these
services in May 2004; and c) an increase in insurance commissions
of $22,000. These increases were somewhat offset by a decrease in
mortgage origination fees of $23,000 and a decrease of $46,000 in
recovery of interest income from loans charged-off in prior years.
For the year ended December 31, 2005, non-interest income totaled
$8,004,000, reflecting an increase of $762,000, or 10.5%, over the
year of 2004. Service charges on deposits declined $310,000, or
7.3%, for the year of 2005 compared to the year 2004 for the same
reason noted above. Other income increased $1,104,000, or 37.3%.
Contributing to this increase were increases in a) investment
services fees of $454,000; b) insurance commissions of $56,000; c)
trust service fees of $175,000; and d) merchant card service fees
of $65,000. Also, in 2005 the increase in other income reflects a
gain on sale of land previously held for expansion of $247,000 and
a rebate of $211, 000 on a processing contract. In comparison, in
2004 there was a gain of $167,000 on the sale of an asset
previously carried in Other Assets and a gain of $37,000 on the
partial sale of land that had been held for future branch
expansion. Non-interest expense for the fourth quarter increased
$1,009,000 over the same quarter of the previous year, a 14.0%
increase. This increase includes the impacts of: a) staff additions
to support the Company's continued growth; b) the inclusion in the
fourth quarter of this year of the expense of Summit Financial
Partners which was acquired in March 2005; c) loss of tenant rents
at one bank facility along with an overall increase in utilities
expense at all the locations; c) an increase in business
development expense; and e) increased expenses for healthcare
benefits for employees and for the annual incentive bonus. These
increases were partially offset by reduced expenses, compared to
the fourth quarter of the prior year, for compliance with Sarbanes
Oxley regulatory requirements. Non-interest expense for the year of
2005 was $30.7 million and reflected an increase of $4.5 million,
or 17.1%. In considering this increase it should be noted that the
acquisition of Arlington National Bank (ANB) was made in May of
2004 and Summit Financial Partners (SFP) was acquired in March
2005, both of these acquisitions would have a comparative impact on
increases in personnel expense and occupancy and equipment expense
for the year of 2005. Reflected in the increase in expenses was a
19.2% increase in personnel expenses and a 15.8% increase in
occupancy and equipment expenses. Approximately 75% of the increase
in personnel expense was attributed to salary and bonuses and
reflects the addition of personnel, including ANB and SFP. The
increase in occupancy and equipment expense also reflects ANB and
SFP plus the loss of a tenant in September 2005 at one of the bank
facilities. In Other Expenses there was an increase of $812,000, or
12.7%, which included increases in business development expense,
professional fees, and miscellaneous other expenses. At December
31, 2005, loans totaling $3,000,000 were on non-accrual status and
represented 0.39% of total loans outstanding. The allowances for
loan losses represented 374% of the non-accrual loans. The dollar
amount of non-accrual loans was the lowest of the year at December
31, 2005. Following the end of the year, a classified borrower with
outstanding loan balances of approximately $9 million notified the
Company that it was experiencing further financial distress. This
borrower's credits had been identified by the Bank as weaker
credits for approximately a year. As of December 31, 2005 the
borrower was current as to principal and interest and was current
as to loan terms. The borrower has asked for an extension of
payments of principal for a period yet to be determined. Any loss
on this credit is subject to many different factors and will not be
determined for some time. Based on current information provided by
the borrower as to collateral, the Company believes the allowance
for loan losses is sufficient to cover the exposure of loss, if
any, on the credit. The Company's loans were $775 million at
December 31, 2005, an increase of $72 million, or 10.3%, from
December 31, 2004. Deposits increased $87 million in 2005 to $879
million at December 31, 2005, an increase of 10.9%. At December 31,
2005 shareholders' equity was $81 million or a book value per share
of $6.54. Summit files annual, quarterly and special reports, proxy
statements and other information with the SEC. Investors may read
and copy any of these reports, statements and other information at
the SEC's public reference room located at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Investors should call the SEC at
1-800-SEC-0330 for further information on the public reference
room. The reports, statements, and other information filed by
Summit with the SEC are also available free at the SEC's web site
at http://www.sec.gov/ . You can also obtain a free copy of these
reports, statements and other information from Summit's web site at
http://www.summitbank.net/ . The Company will host a conference
call Tuesday, January 24, 2006 at 10:30 a.m. (CT) to discuss the
Company's performance for the quarter and year ended December 31,
2005. To participate, please call (800)810-0924 and enter
confirmation code 1674375. If you are unable to participate, an
audio playback of the call will be available starting Tuesday,
January 24, 2006 at 3:00 p.m. (CT) through midnight February 7,
2006 (CT) by calling (888)203-1112 and entering code 1674375. The
2006 Annual Meeting of Shareholders will be held on April 18, 2006
at 3:30 p.m. (CT) at Summit Bancshares, Inc. Corporate
Headquarters, 3880 Hulen Street, Suite 300, Fort Worth, Texas.
Certain statements contained in this press release that are not
historical in nature, including statements regarding the Company's
and/or management's intentions, strategies, beliefs, expectations,
representations, plans, projections, or predictions of the future,
are forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 and are intended to be
covered by the safe harbor provisions for forward-looking
statements contain in such Act. We are including this statement for
purposes of invoking these safe harbor provisions. Forward-looking
statements are based on assumptions involving certain known and
unknown risks and uncertainties, many of which are beyond the
Company's control, and the other important factors that could cause
actual results, performance or achievements to differ materially
from the expectations expressed or implied by such forward-looking
statements. These risks and uncertainties are listed from time to
time in the Company's filings with the Securities and Exchange
Commission, including but not limited to, those set forth under the
heading "Factors That May Affect Future Results" in the Company's
Annual Report on Form 10-K for the year ended December 31, 2004.
SUMMIT BANCSHARES, INC. (Unaudited) (Dollars in thousands, except
per share data) Quarter Ended Twelve Months Ended December 31, %
December 31, % EARNINGS SUMMARY 2005 2004 Change 2005 2004 Change
Interest income $16,734 $12,995 28.8% $59,961 $46,857 28.0%
Interest expense 4,709 2,782 69.3% 15,768 9,506 65.9% Net interest
income 12,025 10,213 17.7% 44,193 37,351 18.3% Provision for loan
losses 340 290 17.2% 1,105 1,790 -38.3% Service charges on deposits
974 1,084 -10.1% 3,938 4,248 -7.3% Gain on sale of investment
securities --- --- --- --- 32 -100.0% Other income 939 727 29.2%
4,066 2,962 37.3% Salaries and benefits expense 4,981 4,160 19.7%
18,277 15,329 19.2% Occupancy and equipment expense 1,431 1,237
15.7% 5,175 4,467 15.8% Other expense 1,799 1,805 -0.3% 7,206 6,394
12.7% Earnings before income taxes 5,387 4,532 18.9% 20,434 16,613
23.0% Provision for income taxes 1,871 1,613 16.0% 7,258 5,851
24.0% Net earnings $3,516 $2,919 20.5% $13,176 $10,762 22.4% Basic
earnings per share $0.28 $0.23 21.7% $1.06 $0.87 21.8% Basic
weighted average shares outstanding 12,442 12,349 12,414 12,326
Diluted earnings per share $0.28 $0.23 21.7% $1.04 $0.85 22.4%
Diluted weighted average shares outstanding 12,723 12,714 12,710
12,679 Average for Quarter Ended Dec. 31, Sept. 30, June 30, March
31, Dec. 31, BALANCE SHEET SUMMARY 2005 2005 2005 2005 2004 Total
loans $753,311 $735,109 $723,535 $706,902 $694,177 Total investment
securities 252,508 226,441 216,825 220,161 226,530 Earning assets
1,017,095 974,844 945,251 932,258 924,557 Total assets 1,082,477
1,038,628 1,007,680 993,154 984,814 Noninterest bearing deposits
259,062 242,849 239,127 225,519 235,846 Interest bearing deposits
608,863 590,390 558,905 559,853 560,341 Total deposits 867,925
833,239 798,032 785,372 796,187 Other borrowings 128,368 121,435
128,684 128,174 109,713 Shareholders' equity 80,684 79,053 76,575
75,602 74,543 Average for Twelve Months Ended December 31, %
BALANCE SHEET SUMMARY 2005 2004 Change Total loans $729,856
$647,686 12.7% Total investment securities 229,065 207,663 10.3%
Earning assets 967,615 869,652 11.3% Total assets 1,030,752 924,202
11.5% Noninterest bearing deposits 241,735 212,482 13.8% Interest
bearing deposits 579,667 523,652 10.7% Total deposits 821,402
736,134 11.6% Other borrowings 126,651 112,592 12.5% Shareholders'
equity 77,995 71,577 9.0% Ending Balance Dec. 31, Sept. 30, June
30, March 31, Dec. 31, BALANCE SHEET SUMMARY 2005 2005 2005 2005
2004 Total loans $774,886 $754,153 $721,161 $716,714 $702,619 Total
investment securities 256,842 236,544 214,750 214,222 223,351 Total
earning assets 1,032,620 1,006,368 945,661 939,934 930,990
Allowance for loan losses (11,208) (11,131) (10,798) (10,519)
(10,187) Premises and equipment 16,515 15,620 15,563 15,462 15,749
Total assets 1,099,735 1,074,261 1,008,475 999,914 989,117
Noninterest bearing deposits 263,027 258,644 241,643 232,556
235,399 Interest bearing deposits 615,749 607,384 562,846 565,002
556,865 Total deposits 878,776 866,028 804,489 797,558 792,264
Other borrowings 134,231 123,892 122,203 124,007 118,094 Total
liabilities 1,018,402 994,534 930,891 925,477 914,627 Shareholders'
equity 81,333 79,727 77,584 74,437 74,490 SUMMIT BANCSHARES, INC.
(Unaudited) (Dollars in thousands) Dec. 31, Sept. 30, June 30,
March 31, Dec. 31, NONPERFORMING ASSETS 2005 2005 2005 2005 2004
Nonaccrual loans $3,000 $4,989 $3,372 $3,294 $2,587 Restructured
loans --- --- --- --- --- Other real estate & foreclosed assets
--- --- --- --- --- Total nonperforming assets $3,000 $4,989 $3,372
$3,294 $2,587 Total nonperforming assets as a percentage of loans
and foreclosed assets 0.39% 0.66% 0.47% 0.46% 0.37% Accruing loans
past due 90 days or more $--- $2,178 $36 $--- $18 Quarter Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31, ALLOWANCE FOR LOAN
LOSSES 2005 2005 2005 2005 2004 Balance at beginning of period
$11,131 $10,798 $10,519 $10,187 $10,079 Loans charged off (286)
(25) (147) (84) (293) Loan recoveries 23 43 201 191 111 Net
(charge-offs) recoveries (263) 18 54 107 (182) Provision for loan
losses 340 315 225 225 290 Balance at end of period $11,208 $11,131
$10,798 $10,519 $10,187 Allowance for loan losses as a percentage
of total loans 1.45% 1.48% 1.50% 1.47% 1.45% Allowance for loan
losses as a percentage of nonperforming loans 373.66% 223.11%
320.23% 319.34% 393.78% Net charge-offs (recoveries) as a
percentage of average loans 0.03% 0.00% -0.01% -0.02% 0.03%
Provision for loan losses as a percentage of average loans 0.05%
0.04% 0.03% 0.03% 0.04% Quarter Ended Dec. 31, Sept. 30, June 30,
March 31, Dec. 31, SELECTED RATIOS 2005 2005 2005 2005 2004 Return
on average assets (annualized) 1.29% 1.32% 1.27% 1.23% 1.18% Return
on average equity (annualized) 17.29% 17.34% 16.71% 16.16% 15.58%
Average shareholders' equity to average assets 7.45% 7.61% 7.60%
7.63% 7.57% Yield on earning assets 6.55% 6.32% 6.12% 5.83% 5.61%
Cost of interest bearing funds 2.53% 2.38% 2.13% 1.85% 1.65% Net
interest margin (tax equivalent) 4.71% 4.58% 4.57% 4.47% 4.41%
Efficiency ratio 58.70% 56.84% 59.07% 59.69% 59.71% End of period
book value per common share $6.54 $6.41 $6.25 $6.01 $6.03 End of
period common shares outstanding 12,444 12,429 12,421 12,390 12,359
SUMMIT BANCSHARES, INC. (Unaudited) (Dollars in thousands) Three
Months Ended December 31, 2005 December 31, 2004 Average Average
YIELD ANALYSIS Balance Interest Yield Balance Interest Yield
Interest Earning Assets: Federal funds sold & due from time
$11,276 $110 3.87% $3,850 $31 3.18% Investment securities (taxable)
241,656 2,369 3.92% 218,512 1,974 3.61% Investment securities
(tax-exempt) 10,852 147 5.42% 8,018 104 5.20% Loans 753,311 14,159
7.46% 694,177 10,921 6.26% Total Interest Earning Assets 1,017,095
16,785 6.55% 924,557 13,030 5.61% Noninterest Earning Assets: Cash
and due from banks 31,390 29,282 Other assets 45,173 41,140
Allowance for loan losses (11,181) (10,165) Total Noninterest
Earning Assets 65,382 60,257 Total Assets $1,082,477 $984,814
Interest Bearing Liabilities: Transaction and money market accounts
$249,910 1,028 1.63% $239,046 690 1.15% Savings deposits 170,004
918 2.14% 168,191 577 1.36% Certificates and other time deposits
188,949 1,548 3.25% 153,104 935 2.43% Other borrowings 128,368
1,215 3.76% 109,713 580 2.10% Total Interest Bearing Liabilities
737,231 4,709 2.53% 670,054 2,782 1.65% Noninterest Bearing
Liabilities: Demand deposits 259,062 235,846 Other liabilities
5,500 4,371 Shareholders' equity 80,684 74,543 Total Noninterest
Bearing Liabilities 345,246 314,760 Total Liabilities and
Shareholders' Equity $1,082,477 $984,814 Net Interest Income and
Margin (tax equivalent) $12,076 4.71% $10,248 4.41% SUMMIT
BANCSHARES, INC. (Unaudited) (Dollars in thousands) Twelve Months
Ended December 31, 2005 December 31, 2004 Average Average YIELD
ANALYSIS Balance Interest Yield Balance Interest Yield Interest
Earning Assets: Federal funds sold & due from time $8,694 $292
3.36% $14,303 $170 1.19% Investment securities (taxable) 219,751
8,281 3.77% 200,383 7,409 3.70% Investment securities (tax-exempt)
9,314 496 5.33% 7,280 395 5.43% Loans 729,856 51,064 7.00% 647,686
39,024 6.03% Total Interest Earning Assets 967,615 60,133 6.21%
869,652 46,998 5.40% Noninterest Earning Assets: Cash and due from
banks 30,620 28,620 Other assets 43,296 35,281 Allowance for loan
losses (10,779) (9,351) Total Noninterest Earning Assets 63,137
54,550 Total Assets $1,030,752 $924,202 Interest Bearing
Liabilities: Transaction and money market accounts $237,415 3,428
1.44% $232,155 2,518 1.08% Savings deposits 168,507 3,124 1.85%
149,510 1,832 1.23% Certificates and other time deposits 173,745
5,111 2.94% 141,987 3,327 2.34% Other borrowings 126,651 4,105
3.24% 112,592 1,829 1.62% Total Interest Bearing Liabilities
706,318 15,768 2.23% 636,244 9,506 1.49% Noninterest Bearing
Liabilities: Demand deposits 241,735 212,482 Other liabilities
4,704 3,899 Shareholders' equity 77,995 71,577 Total Noninterest
Bearing Liabilities 324,434 287,958 Total Liabilities and
Shareholders' Equity $1,030,752 $924,202 Net Interest Income and
Margin (tax equivalent) $44,365 4.58% $37,492 4.31% SUMMIT
BANCSHARES, INC. (Unaudited) (Dollars in thousands, except per
share data) December 31, December 31, LOAN PORTFOLIO 2005 % 2004 %
Commercial and industrial $277,827 35.9% $261,571 37.2% Real
estate: Commercial 260,736 33.6% 224,720 32.0% Residential 91,183
11.8% 82,839 11.8% Construction and development 106,227 13.7%
93,558 13.3% Consumer 38,913 5.0% 39,931 5.7% Total loans (gross)
774,886 100.0% 702,619 100.0% Unearned discounts --- 0.0% --- 0.0%
Total loans (net) $774,886 100.0% 702,619 100.0% Dec. 31, Dec. 31,
REGULATORY CAPITAL DATA 2005 2004 Tier 1 Capital $85,377 $76,435
Tier 1 Ratio 10.64% 10.14% Total Capital (Tier 1 + Tier 2) $95,240
$85,863 Total Capital Ratio 11.89% 11.40% Total Risk-Adjusted
Assets $802,309 $753,509 Tier 1 Leverage Ratio 7.97% 7.85% Dec. 31,
Dec. 31, OTHER DATA 2005 2004 Full Time Equivalent Employees
(FTE's) 267 254 Stock Price Range (For the Quarter Ended): High
$19.75 $18.95 Low $16.78 $16.33 Close $17.98 $18.75
http://www.newscom.com/cgi-bin/prnh/20041025/DASBANKLOGO
http://photoarchive.ap.org/ DATASOURCE: Summit Bancshares, Inc.
CONTACT: Bob G. Scott, COO of Summit Bancshares, Inc.,
+1-817-877-2660 Web site: http://www.summitbank.net/
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