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Press Release

Presidio Bank Reports 37% Increase in Net Income for the Third Quarter

Company Release - 10/17/2013 2:19 PM ET

SAN FRANCISCO--(BUSINESS WIRE)-- Presidio Bank (OTCBB: PDOB), a Bay Area business bank, today reported unaudited results for the quarter ended September 30, 2013 with net income of $728 thousand, up 37% from the quarter ended June 30, 2013 and up 60% from the quarter ended September 30, 2012. This represents the highest quarterly net income achieved by the Bank.

“We are pleased that with our continued loan growth, the Bank has reached a size where we are beginning to realize some operating efficiencies that materially enhance our profitability,” said Steve Heitel, Presidio Bank President & CEO.

Financial Highlights

  • Total Loans Outstanding grew by $18 million or 5% over the quarter ended June 30, 2013 and by $87 million or 33% over the quarter ended September 30, 2012.
  • Total Deposits decreased by $11 million or 3% from the quarter ended June 30, 2013 and increased $6 million from the quarter ended September 30, 2012. This decrease was anticipated as some of the large growth in deposits in the first quarter of 2013 was due to temporary funds.
  • Net Interest Income of $4.1 million in the quarter was the highest in the bank’s history and 18% higher than the third quarter of 2012.
  • Operating Expenses declined 5% from the second quarter 2013 but increased 6.9% from the third quarter 2012.
  • Net Income applicable to common shareholders was $585 thousand for the third quarter of 2013, and increase of 51% over the second quarter of 2013 and an increase of 87% of the third quarter of 2012.
  • Diluted Earnings per Common Share were $0.14 for the quarter compared to $0.09 in the second quarter of 2013.
  • Book Value per Share increased to $8.74 per share as of September 30, 2013 from $8.54 per share at June 30, 2013.

“The Bank was proud to be selected as a model for MIT’s Department of Urban Studies and Planning comprehensive study entitled ‘Enhancing the Local Impact of Community Banks’ that was completed in September,” said Presidio Bank Chairman and Founder, Jim Woolwine. “It was rewarding to see that many of the Bank’s community development activities were regarded as best practices in the study.”

 

3rd Quarter 2013 Financial Results

(Dollars in thousands, except per share amounts, unaudited)

                               

Condensed Balance Sheet

 
9/30/2013 6/30/2013 Change 9/30/2012 Change 12/31/2012 Change
 
Cash and due from banks 5,557 4,091 35.8 % 2,123 161.8 % 5,105 8.9 %
Interest bearing due from banks   51,284         79,991       -35.9 %       144,019       -64.4 %   71,489       -28.3 %
Total cash and equivalents 56,841 84,082 -32.4 % 146,142 -61.1 % 76,594 -25.8 %
Investment Securities 14,218 14,144 0.5 % 3,194 345.1 % 13,445 5.7 %
Loans, net of fees 351,470 333,724 5.3 % 264,889 32.7 % 313,992 11.9 %
Allowance for loan losses   (4,865 )       (4,865 )     0.0 %       (4,945 )     -1.6 %   (4,945 )     -1.6 %
Net loans 346,605 328,859 5.4 % 259,943 33.3 % 309,047 12.2 %
Premises and equipment, net 909 984 -7.6 % 1,071 -15.2 % 1,221 -25.6 %
Deferred tax assets 3,118 3,276 -4.8 % 3,281 -5.0 % 3,324 -6.2 %
Other assets and interest receivable   1,831         1,841       -0.5 %       1,698       7.8 %   1,840       -0.5 %
Total Assets 423,523 433,186 -2.2 % 415,329 2.0 % 405,471 4.5 %
 
Non-interest-bearing demand 125,452 146,309 -14.3 % 118,288 6.1 % 131,438 -4.6 %
Interest bearing transaction 65,749 51,874 26.7 % 51,180 28.5 % 53,780 22.3 %
Money market and savings accounts 141,198 144,514 -2.3 % 153,957 -8.3 % 129,238 9.3 %
Time deposits   41,108         41,745       -1.5 %       44,389       -7.4 %   42,918       -4.2 %
Total Deposits 373,507 384,442 -2.8 % 367,814 1.5 % 357,374 4.5 %
Other liabilities   2,523         2,105       19.9 %       1,599       57.8 %   2,209       14.2 %
Total Liabilities 376,030 386,547 -2.7 % 369,413 1.8 % 359,583 4.6 %
 
Preferred Stock 11,051 11,035 0.1 % 10,986 0.6 % 11,002 0.4 %
Common Stock 43,333 43,125 0.5 % 42,681 1.5 % 42,809 1.2 %
Retained earnings (6,683 ) (7,252 ) 7.8 % (7,750 ) 13.8 % (7,905 ) 15.5 %
Other comprehensive income   (208 )       (269 )     22.7 %       -           (18 )      
Total Shareholder’s Equity   47,493         46,638       1.8 %       45,916       3.4 %   45,889       3.5 %
Total Liabilities and Equity 423,523 433,186 -2.2 % 415,329 2.0 % 405,471 4.5 %
 
Book value per share
Book value per share $ 8.74 $ 8.54 $ 8.47 $ 8.46
Total Shares outstanding EOP 4,170 4,170 4,123 4,123
 
Capital Ratios
Tier 1 leverage ratio 11.1 % 11.1 % 11.1 % 10.8 %
Tier 1 risk-based capital ratio 11.9 % 12.0 % 14.4 % 13.7 %
Total risk-based capital ratio 13.2 % 13.3 % 15.7 % 15.0 %
 
             

Condensed Statement of Income

 
For the three months ended For the nine months ended
  9/30/2013         6/30/2013       Change Fav./ (Unfav.)       9/30/2012       Change Fav./ (Unfav.)   9/30/2013         9/30/2012       Change Fav./ (Unfav.)
                       
Interest Income 4,317 4,151 4.0 % 3,700 16.7 % 12,366 11,151 10.9 %
Interest Expense   209         205       (1.8 %)       213       1.8 %   607         670       9.5 %
Net Interest Income 4,108 3,945 4.1 % 3,487 17.8 % 11,759 10,480 12.2 %
Provision for Loan Loss   -         -       NM         -       NM     -         -       NM  
Net Interest Income After Provision 4,108 3,945 4.1 % 3,487 17.8 % 11,759 10,480 12.2 %
 
Other income 146 145 0.3 % 118 23.1 % 420 367 14.5 %
 
Compensation and benefit expenses 1,794 1,796 0.1 % 1,699 (5.5 %) 5,463 5,330 (2.5 %)
Occupancy and equipment expenses 383 385 0.7 % 422 9.4 % 1,153 1,204 4.3 %
Data processing 249 256 2.7 % 233 (6.6 %) 748 643 (16.3 %)
Professional and legal 105 212 50.5 % 84 (25.0 %) 449 263 (70.9 %)
Other operating expenses   491         542       9.5 %       386       (27.0 %)   1,489         1,213       (22.7 %)
Total Operating Expenses   3,021         3,190       5.3 %       2,825       (6.9 %)   9,301         8,653       (7.5 %)
Net Income Before Taxes 1,233 900 37.0 % 780 58.1 % 2,877 2,193 31.2 %
Income taxes   506         369       (37.0 %)       325       (55.7 %)   1,180         904       (30.5 %)
Net Income 728 531 37.0 % 456 59.7 % 1,698 1,289 31.7 %
Preferred Dividends   142         142       0.0 %       142       0.0 %   427         427       0.0 %
Net Income to Common 585 389 50.5 % 313 86.9 % 1,271 862 47.4 %
 
Earnings Per Share
Basic earnings per share $ 0.14 $ 0.09 $ 0.08 $ 0.31 $ 0.21
Diluted earnings per share $ 0.14 $ 0.09 $ 0.08 $ 0.31 $ 0.21
Average shares outstanding 4,133 4,120 4,071 4,113 4,068
Average fully diluted shares 4,157 4,142 4,076 4,139 4,072
 
Performance Ratios
Return on average assets 0.68 % 0.52 % 0.45 % 0.55 % 0.45 %
Return on average common equity 6.40 % 4.36 % 3.62 % 4.74 % 3.34 %
Net interest margin 3.88 % 3.90 % 3.70 % 3.89 % 3.82 %
Cost of Funds 0.22 % 0.23 % 0.24 % 0.22 % 0.27 %
Efficiency ratio 71.0 % 78.0 % 78.4 % 76.4 % 79.8 %
 
Average Balances
Total Assets 427,409 412,907 401,555 411,506 383,549
Earning Assets 420,255 406,168 395,399 404,666 376,632
Total Loans 342,378 329,961 263,916 328,304 258,735
Total Deposits 377,918 364,277 354,151 362,689 336,568
Common Equity 36,291 35,754 34,347 35,814 34,533

NM = Not Meaningful

About Presidio Bank

Presidio Bank provides business banking services to small and mid-size businesses, including professional service firms, real estate developers and investors, and not-for-profit organizations, and to their owners who desire personalized, responsive service with access to local decision makers. Presidio Bank offers clients the resources of a large bank combined with the personalized services of a neighborhood bank. Presidio Bank is headquartered in San Francisco, California and currently operates four banking offices in San Francisco, Walnut Creek, San Rafael and Palo Alto. More information is available at www.presidiobank.com. Presidio Bank is a member of FDIC and an Equal Housing Lender.

This press release contains certain forward-looking statements that involve risk and uncertainties. These statements are identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “plan,” “estimate,” “project,” or similar expressions. The risks and uncertainties that may affect the operations, performance, development, growth projections and results of Presidio Bank’s business include, but are not limited to, the growth of the economy, interest rate movements, timely development by Presidio Bank of technology enhancements for its products and operating systems, the impact of competitive products, services and pricing, client-based requirements, Congressional legislation, changes in regulatory or generally accepted accounting principles and similar matters. Readers are cautioned not to place undue reliance on forward-looking statements which are subject to influence by the named risk factors and unanticipated future events. Actual results, accordingly, may differ materially from management expectations.

Presidio Bank
Steve Heitel, 415-229-8428
President & CEO
or
Ed Murphy, 415-229-8403
EVP/CFO
or
Annette Gelinas, 415-229-8415 (o) or 925-787-2956 (c)
SVP/Marketing Director
agelinas@presidiobank.com

Source: Presidio Bank