Jhild and ColleenB.... Stuff it!!!! NEWS!!!!!
(COMTEX) B: Pacific Capital Bancorp Announces Record Combined Earning
B: Pacific Capital Bancorp Announces Record Combined Earnings
SANTA BARBARA, CALIF. (April 19) BUSINESS WIRE -April 19, 1999--
Summary:
Pacific Capital Bancorp (Nasdaq:SABB) today announced sharply higher
net income for the first quarter of 1999 compared to the first quarter
of 1998.
At $14.5 million, net income was up 35% over the $10.7 million earned
the same quarter a year ago. Earnings per share were up 34% from $0.44
to $0.59.
The primary reasons for the higher income in 1999 were the significant
growth in the company's tax refund loan and transfer programs, an
increase in net interest income due to the growth in loans, and
increased service fee income and fees from trust and investment
services. Also contributing to the increase in earnings compared to the
first quarter of 1998 was a lower cost of funds.
Pacific Capital Bancorp is the parent corporation of Santa Barbara Bank
& Trust, First National Bank of Central California and its affiliate
South Valley National Bank. The merger of Santa Barbara Bancorp and the
former Pacific Capital Bancorp was finalized Dec. 30, 1998, and this is
the first full quarter representing combined operations.
Detail:
According to Chief Operating Officer William S. ("Tom") Thomas, the
company's first quarter performance is a positive reflection of the
substantial synergies anticipated from the new community banking
network serving the Central Coast.
"We are very pleased to have been able to post such a strong quarter on
behalf of our shareholders," said Thomas, "particularly so soon after
forming this unique community banking network. We clearly remain on
course with our financial goals and objectives and we are confident
that the cost savings and revenue enhancements of this strategic
partnership will continue to be recognized going forward."
Additionally, Thomas noted: "We also saw significant loan growth
throughout the organization, increased fee income from our Trust &
Investment Services programs, and substantially increased activity in
the company's tax refund programs. Growth in deposits during the
quarter at each of our subsidiary banks demonstrates their continuing
ability to profitably cultivate their individual markets."
For the first quarter of 1999, net interest income, the difference
between interest income and interest expense, was $40.4 million. This
was an increase of $6.3 million or 18% over the comparable 1998 figure.
Interest on loans increased $6.2 million compared to the amount earned
in the same quarter a year ago.
This is due in part to an expansion of the refund loan program ($1.1
million), but is primarily due to a 26% increase in loans over the last
12 months. Earnings from other assets were marginally lower as proceeds
from the sale or maturity of securities and money market instruments
were used to fund the loan growth.
Interest expense decreased despite a 10% increase in deposits because
of a decline in market interest rates compared to the first quarter of
1998. The net interest margin increased from 6.38% for the first
quarter of 1998 to 6.48% for the first quarter of 1999.
While the refund loan program has grown this year, the loss ratio in
the program is running significantly lower than in 1998. This permitted
a $2.5 million decrease in the provision for credit losses related to
the program. The provision related to loans other than refund loans
increased $233,000 compared to the first quarter of 1998.
Noninterest income in the first quarter of 1999 increased $2.4 million
over the same quarter last year. This was principally due to a
substantial increase in fees ($1.6 million or 37%) from the tax refund
transfer program. Fees generated by the Trust & Investment Services
Division are in large part based on asset values. With the stock
markets higher this year and with new customers, these fees increased
$486,000.
Noninterest expense also increased as the company grew. The most
significant increase was due to consultant expense and contract labor
to assist with the company's Y2K project and the conversion of data
processing systems related to the merger. Nonetheless, Pacific
Capital's operating efficiency ratio for the first quarter remained
virtually identical at 48.4% in 1999 compared to 48.2% in 1998.
Based on the current economic outlook, management anticipates that the
company will continue to experience loan and deposit growth during the
remainder of 1999 and consequently expects that net income each quarter
will be greater than for the same quarter of 1998.
As in past years, most of the activity in the tax refund programs will
occur in the first quarter, and because this program was a major
contributor for first quarter 1999 net income exceeding first quarter
1998 net income by 35%, management does not anticipate that net income
in subsequent quarters of 1999 will exceed net income for the
corresponding quarter of 1998 by as large a percentage.
In March, the board of directors declared a quarterly cash dividend of
18 cents per share. The dividend will be paid May 11, 1999, to
shareholders of record April 20, 1999.
The company has become aware that another financial institution has
been assigned the ticker symbol PABN (Nasdaq:PABN) that was used by the
former Pacific Capital Bancorp prior to the merger with Santa Barbara
Bancorp on Dec. 30, 1998. Because many of the Internet search engines
use the ticker symbol for indexing, Internet users searching for news
about Pacific Capital Bancorp by using the PABN ticker symbol will now
get search results that include a mixture of information about the
former Pacific Capital Bancorp, about Santa Barbara Bancorp, and about
the new holder of the PABN ticker symbol, PanAmerican Bancorp.
Shareholders of Pacific Capital Bancorp should always remember to use
the SABB ticker symbol in their search criteria.
Pacific Capital Bancorp is the holding company for Santa Barbara Bank &
Trust, First National Bank of Central California and its affiliate
South Valley National Bank. Santa Barbara Bank & Trust maintains 27
offices serving communities throughout Santa Barbara and west Ventura
counties.
First National Bank maintains offices in Monterey, Salinas, Carmel,
Watsonville and Soledad. Offices in Gilroy, Morgan Hill, Hollister and
San Juan Bautista operate under the name South Valley National Bank.
This news release contains forward-looking statements with respect to
the financial conditions, results of operations and businesses of
Pacific Capital Bancorp. These include statements that relate to or are
dependent on estimates or assumptions relating to: (a) charges expected
to be incurred in connection with the merger; (b) the cost savings and
consequent accretion to reported earnings that will be realized from
the merger; (c) the ability of the company to successfully modify
and/or replace its critical systems to handle the century date change;
and (d) the prospects of continued loan growth and improved credit
quality in 1999. These forward-looking statements involve certain risks
and uncertainties. Factors that may cause actual results to differ
materially from those contemplated by such forward-looking statements
include, among others, the following possibilities: (1) expected cost
savings from the merger are not fully realized or realized within this
expected timeframe; (2) revenues following the merger are lower than
expected; (3) competitive pressure among financial services companies
increases significantly; (4) costs or difficulties related to the
integration of the data processing and other systems are greater than
expected; (5) costs or difficulties related to modifying or replacing
critical systems in anticipation of the century date change are greater
than expected; (6) changes in the interest rate environment reduce
interest margins; (7) general economic conditions, internationally,
nationally or in the state of California, are less favorable than
expected; and (8) legislation or regulatory requirements or changes
adversely affect the business in which the combined company will be
engaged.
PACIFIC CAPITAL BANCORP
Summary Financial Data
(Unaudited)
($ in millions except per share earnings):
As of As of
3/31/99 3/31/98
Loans $1,707.8 $1,352.9
Allowance for credit losses $ 31.5 $ 29.3
Assets $2,700.3 $2,423.4
Deposits $2,361.7 $2,135.3
Capital $ 224.2 $ 198.6
Quarter Ended
3/31/99 3/31/98
Interest income $ 56.6 $ 50.7
Interest expense (16.3) (16.6)
Net interest income 40.3 34.1
Provision for credit loss (3.7) (6.0)
Non-interest income 13.8 11.7
Non-interest expense (27.0) (22.7)
Pre-tax income 23.4 17.1
Taxes (8.9) (6.4)
Net income $ 14.5 $ 10.7
Basic earnings per share $0.60 $0.45
Diluted earnings per share $0.59 $0.44
Actual shares
outstanding at end of period 24.347 23.698
Average shares
for basic earnings per share 24.240 23.598
Average shares
for diluted earning per share 24.612 24.277
Operating efficiency ratio 48.4% 48.2%
Return on average assets 2.11% 1.81%
Return on average equity 26.8% 22.06%
-0- ECQ/la* SJK/la
CONTACT: Pacific Capital Bancorp, Santa Barbara
David W. Spainhour, 805/564-6345
William S. "Tom" Thomas Jr., 805/564-6216
KEYWORD: CALIFORNIA
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