EXTON, Pa., Nov. 3 /PRNewswire-FirstCall/ -- First Resource Bank
(OTC Bulletin Board: FRSB) announced third quarter net income of $9,978 for
the three months ended September 30, 2008. Pre-tax income for the quarter
ended September 30, 2008 was $16,141, which compares to pre-tax income of
$37,497 for the quarter ended June 30, 2008 and $54,005 for the quarter ended
September 30, 2007.
Net interest income was $778,073 for the quarter ended September 30, 2008
as compared to $720,504 for the previous quarter. This 8% increase in net
interest income was caused by the increase in net interest margin from 3.06%
for the three months ended June 30, 2008 to 3.19% for the three months ended
September 30, 2008. This net interest margin improvement was lead by a 27
basis point decline in the cost of certificates of deposit as existing
deposits re-priced lower during the quarter.
Deposits increased $4.9 million, or 6.3%, during the third quarter to a
total of $83.1 million at September 30, 2008. This strong deposit growth was
mainly in certificates of deposit which grew $6.0 million, or 9.9%, mainly due
to growth in CDARS(R), Certificate of Deposit Account Registry Service,
deposits. Mr. Marshall stated, "We use CDARS offensively to gather deposits
away from our larger competitors that do not effectively market the product at
a grass roots level as we do. Most of our deposit growth during the quarter
came from existing customers that consolidated their bank relationships at
First Resource Bank due to our ability to offer the combination of superior
customer service and safety in form of FDIC insurance up to $50 million per
depositor through the CDARS(R) program."
The loan portfolio grew $2.7 million, or 3.0%, during the third quarter to
$92.9 million at September 30, 2008 as follows:
Sept. 30, June 30, Sept. 30,
2008 2008 2007
Commercial real estate $ 44,763,083 $ 45,224,825 $ 39,085,790
Commercial construction 17,711,333 15,740,019 14,137,540
Commercial business 10,348,947 9,578,888 6,466,648
Consumer 20,093,883 19,626,732 19,021,185
Total loans $ 92,917,246 $ 90,170,464 $ 78,711,163
Mr. Marshall stated, "We anticipate a peak in our construction lending
activities at September 30, 2008 with the completion of multiple commercial
and residential rental projects and their movement to the occupied permanent
mortgage phase of the credit facility during the fourth quarter."
The allowance for loan losses to total loans was 1.10% at September 30,
2008 as compared to 1.07% at June 30, 2008 and 1.11% at December 31, 2007.
There were no loan charge-offs during the three months ended September 30,
2008. Non-performing loans at September 30, 2008 totaled $826,429, comprised
of one $637,098 commercial construction loan relationship and two unrelated
home equity lines of credit totaling $189,331. There were no additions to the
non-performing loan portfolio during the three months ended September 30,
2008, and there were no additions to loans exceeding 90 days past due at
September 30, 2008.
Non interest income declined in the third quarter due to the
discontinuance of our mortgage brokerage relationship and a decline in loan
fees. The second quarter of 2008 had unusually high loan fees for several
loans that were fully participated out to other banks.
Non interest expense increased $53,898, or 7.9% in the three months ended
September 30, 2008 as compared to the three months ended June 30, 2008. This
increase was largely due to a $30,000 termination fee paid to an investment
banker related to a proposed common stock offering that was abandoned due to
poor capital market conditions. This expense is included in professional
fees. In addition, salaries and benefits increased due to the addition of one
employee during the three months ended September 30, 2008.
During the third quarter, a common stock offering commenced which raised
$388,438 in new capital as of September 30, 2008. This offering will continue
during the fourth quarter however the outcome of it is uncertain in this
difficult capital market. Management is currently assessing the opportunities
presented in the United States Treasury Capital Purchase Plan.
Selected Financial Data:
Balance Sheets (unaudited)
Sept. 30, Dec. 31, Sept. 30,
2008 2007 2007
Cash and due from banks $955,411 $ 1,506,236 $381,859
Federal funds sold - 26,000 27,000
Cash & cash equivalents 955,411 1,532,236 408,859
Investments 8,385,515 13,285,659 8,955,594
Loans 92,917,246 81,494,923 78,711,163
Allowance for loan losses (1,019,483) (908,342) (939,603)
Premises & equipment 376,475 381,200 414,708
Other assets 1,535,301 1,516,360 1,150,859
Total assets $103,150,465 $97,302,036 $88,701,580
Non-interest bearing
deposits $3,465,930 $ 2,500,698 $ 2,740,006
Interest-bearing checking 1,024,950 1,368,086 897,595
Money market 18,269,025 16,656,631 18,945,193
Time deposits 60,290,876 49,151,653 53,626,845
Total deposits 83,050,781 69,677,068 76,209,639
Borrowings 10,253,000 18,120,700 2,980,000
Other liabilities 381,516 355,671 410,678
Total liabilities 93,685,297 88,153,439 79,600,317
Common stock 1,261,419 1,197,994 1,140,517
Surplus 9,316,460 9,012,240 9,043,995
Accumulated other
comprehensive
income (loss) (21,473) 478 552
Accumulated deficit (1,091,238) (1,062,115) (1,083,801)
Total stockholders'
equity 9,465,168 9,148,597 9,101,263
Total Liabilities &
Stockholders' Equity $103,150,465 $97,302,036 $88,701,580
Performance Qtr Ended Qtr Ended Qtr Ended Qtr Ended Qtr Ended
Statistics Sept. 30, June 30, Mar. 31, Dec. 31, Sept. 30,
(unaudited) 2008 2008 2008 2007 2007
Net interest
margin 3.19% 3.06% 3.23% 3.59% 3.60%
Nonperforming
loans/total loans 0.89% 0.92% 1.03% 0.48% 1.16%
Allowance for
loan losses/
Total loans 1.10% 1.07% 1.08% 1.11% 1.19%
Average loans/
Average assets 93.0% 92.7% 93.4% 93.6% 90.9%
Non interest
expenses/
Average assets 0.73% 0.71% 0.74% 0.80% 0.77%
Income Statements (unaudited)
Qtr Ended Qtr Ended Qtr Ended Qtr Ended Qtr Ended
Sept. 30, June 30, Mar. 31, Dec. 31, Sept. 30,
2008 2008 2008 2007 2007
INTEREST INCOME
Loans $1,544,802 $1,491,209 $1,533,961 $1,606,329 $1,559,217
Investments 43,174 43,536 37,506 51,293 71,010
Federal funds sold 4,970 5,568 6,616 368 14,335
Other 16 66 140 145 204
Total interest
income 1,592,962 1,540,379 1,578,223 1,658,135 1,644,766
INTEREST EXPENSE
Borrowings 93,502 77,493 65,691 51,502 6,291
Checking 1,975 2,144 2,631 2,447 2,766
Money Market 123,127 124,712 152,605 183,065 214,885
Time deposits 596,285 615,526 631,757 648,941 666,135
Total interest
expense 814,889 819,875 852,684 885,955 890,077
Net interest
income 778,073 720,504 725,539 772,180 754,689
Provision for
loan losses 50,198 38,489 165,738 68,980 72,825
NON INTEREST INCOME
Mortgage fee income 725 2,214 11,129 7,022 7,818
Other income 21,058 32,887 16,929 18,106 15,436
Total non interest
income 21,783 35,101 28,058 25,128 23,254
NON INTEREST EXPENSE
Salaries &
benefits 363,709 339,595 357,128 342,404 330,995
Occupancy &
equipment 99,655 98,922 88,143 89,325 86,212
Data processing 50,256 49,689 49,787 50,184 44,064
Professional fees 75,081 55,617 53,479 54,380 62,836
Advertising 21,133 23,590 19,223 31,023 26,273
Other non
interest
expenses 123,683 112,206 114,235 125,684 100,733
Total non
interest
expense 733,517 679,619 681,995 693,000 651,113
Pre-tax income
(loss) 16,141 37,497 (94,136) 35,328 54,005
Tax benefit
(expense) (6,163) (13,825) 31,362 (13,642) 542,053
Net income (loss) $9,978 $23,672 $(62,774) $21,686 $596,058
Income Statements (unaudited)
Nine Months Ended Nine Months Ended
Sept. 30, Sept. 30,
2008 2007
INTEREST INCOME
Loans $4,569,972 $4,316,010
Investments 124,216 185,366
Federal funds sold 17,154 180,942
Other 222 1,885
Total interest income 4,711,564 4,684,203
INTEREST EXPENSE
Borrowings 236,686 7,732
Checking 6,750 7,446
Money Market 400,444 613,934
Time deposits 1,843,568 1,897,569
Total interest expense 2,487,448 2,526,681
Net interest income 2,224,116 2,157,522
Provision for loan losses 254,425 261,711
NON INTEREST INCOME
Mortgage fee income 14,068 30,304
Other income 70,874 32,963
Total non interest income 84,942 63,267
NON INTEREST EXPENSE
Salaries & benefits 1,060,432 980,627
Occupancy & equipment 286,720 254,569
Data processing 149,732 129,146
Professional fees 184,177 165,303
Advertising 63,946 67,519
Other non interest expense 350,124 274,680
Total non interest expense 2,095,131 1,871,844
Pre-tax income (loss) (40,498) 87,234
Tax benefit (expense) 11,375 542,053
Net income (loss) $(29,123) $629,287
About First Resource Bank
First Resource Bank is a locally owned and operated Pennsylvania
state-chartered bank, serving the banking needs of businesses, professionals
and individuals in Chester County, Pennsylvania. The Bank offers a full range
of deposit and credit services with a high level of personalized service.
First Resource Bank also offers a broad range of traditional financial
services and products, competitively priced and delivered in a responsive
manner to small businesses, professionals and residents in the local market.
For additional information visit our website at www.firstresourcebank.com.
Member FDIC.
This press release contains statements that are not of historical facts
and may pertain to future operating results or events or management's
expectations regarding those results or events. These are "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933
and Section 21E of the Securities and Exchange Act of 1934. These
forward-looking statements may include, but are not limited to, statements
about our plans, objectives, expectations and intentions and other statements
contained in this press release that are not historical facts. When used in
this press release, the words "expects", "anticipates", "intends", "plans",
"believes", "seeks", "estimates", or words of similar meaning, or future or
conditional verbs, such as "will", "would", "should", "could", or "may" are
generally intended to identify forward-looking statements. These
forward-looking statements are inherently subject to significant business,
economic and competitive uncertainties and contingencies, many of which are
either beyond our control or not reasonably capable of predicting at this
time. In addition, these forward-looking statements are subject to
assumptions with respect to future business strategies and decisions that are
subject to change. Actual results may differ materially from the results
discussed in these forward-looking statements. Readers of this press release
are accordingly cautioned not to place undue reliance on forward-looking
statements. First Resource Bank disclaims any intent or obligation to update
publicly any of the forward-looking statements herein, whether in response to
new information, future events or otherwise.
