Peapack-Gladstone Financial Corporation Reports 34% Increase in Quarterly Earnings Per Share Diluted Earnings Per Share Increased 16 Percent For the Year 2001

Bank's Market Area to Widen with Opening of 17th Branch in Warren, New Jersey



    GLADSTONE, N.J., Feb. 1 /PRNewswire-FirstCall/ --
 Peapack-Gladstone Financial Corporation (Amex:   PGC) reported record earnings
 of $0.71 per diluted share for the fourth quarter ended December 31, 2001, an
 increase of 34.0 percent over the $0.53 per diluted share for the fourth
 quarter of 2000.  Net income increased to $2.41 million for the quarter
 compared with $1.79 million for the fourth quarter of 2000, an increase of
 34.6 percent.  These fourth quarter results produced a return on average
 assets ("ROA") of 1.41 percent and return on average equity ("ROE") of
 15.38 percent.
     For the year ended December 31, 2001, diluted per share earnings were
 $2.64, an increase of 16.3 percent over the $2.27 reported for the year ended
 December 31, 2000.  Net income was $8.92 million for the year ended December
 31, 2001, compared with the $7.71 million for the prior year.  Net income for
 the year ended December 31, 2000 includes a net, after tax merger charge of
 $423,000 or $0.13 per diluted share, recorded in connection with the first
 quarter of 2000 acquisition of Chatham Savings Bank, FSB.
     Frank A. Kissel, Peapack's Chairman and CEO noted, "We are extremely
 pleased to report our results for the quarter and year ended 2001 which
 generated record earnings and significant growth.  Assets increased
 $138 million, or 24.3 percent and exceeded $700 million for the first time in
 the Corporation's history.  Loan growth remained vibrant throughout the year
 and was funded by strong growth in core deposits.  Excess liquid assets were
 invested in intermediate-term, fixed rate securities during the year to grow
 net interest income and mitigate the adverse effects of numerous interest rate
 reductions, and we are now realizing very positive results from those actions.
 We are optimistic that this positive momentum will continue into 2002.  PGB
 Trust and Investments reached a milestone as well, recording fee income in
 excess of $4 million for the year."
     "Additionally, we are pleased to announce further branch expansion with a
 new full service branch located in the King's Shopping Center in Warren in
 Somerset County, pending approval by the State of New Jersey Department of
 Banking & Insurance.  We are very enthusiastic about the prospect of serving
 this affluent, high growth area.  Our recently opened Clinton branch has
 exceeded our initial expectations as we look forward to serving this growing
 market area.  Peapack will continue to explore opportunities for additional
 branches in communities strategically located contiguous to our existing
 market to complement and enhance our business."
     Net interest income for the fourth quarter of 2001 was $6.86 million, an
 increase of $1.13 million or 19.7 percent over the $5.73 million recorded in
 the year earlier period.  The net interest margin in the fourth quarter of
 2001 was 4.27 percent as compared to 4.40 percent in the fourth quarter of
 2000.  The fourth quarter net interest income and margin were impacted by
 higher volumes of earning assets, deposits and changes in interest rates.
     Credit quality remained strong as non-performing loans totaled
 $327 thousand or 0.08 percent of total loans at December 31, 2001 as compared
 to $400 thousand or 0.12 percent of total loans at December 31, 2000.  The
 allowance for loan losses was $4.02 million or 0.96 percent of total loans at
 December 31, 2001 as compared to $3.44 million or 1.00 percent of total loans
 at December 31, 2000.
 
     Peapack-Gladstone Financial Corporation is a bank holding company with
 total assets of $705 million as of December 31, 2001.  Peapack-Gladstone Bank,
 its wholly owned community bank, was established in 1921, and has 16 branches
 in Somerset, Hunterdon and Morris Counties.  Its Trust Division, PGB Trust and
 Investments with $1 billion in assets under management, operates at the Bank's
 main office located at 190 Main Street in Gladstone.
 
     The foregoing contains forward-looking statements within the meaning of
 the Private Securities Litigation Reform Act of 1995.  Such statements are not
 historical facts and include expressions about management's confidence and
 strategies and management's expectations about new and existing programs and
 products, relationships, opportunities, technology and market conditions.
 These statements may be identified by such forward-looking terminology as
 "expect," "look," "believe," "anticipate," "may," "will" or similar statements
 or variations of such terms.  Such forward-looking statements include certain
 risks and uncertainties.  These include, but are not limited to, the direction
 of the economy in New Jersey especially as it has been affected by recent
 developments, the direction of interest rates, continued levels of loan
 quality and origination volume, continued relationships with major customers
 including sources for loans, as well as the effects of general economic
 conditions and legal and regulatory barriers and structure.  Actual results
 may differ materially from such forward-looking statements.  Peapack-Gladstone
 assumes no obligation for updating any such forward-looking statements at any
 time.
 
                    PEAPACK-GLADSTONE FINANCIAL CORPORATION
                      SELECTED CONSOLIDATED FINANCIAL DATA
                                   UNAUDITED
                (Dollars in Thousands, Except Per Share Amounts)
 
                               At or For The Three       At or For The Twelve
                                 Months Ended                Months Ended
                                  December 31,                December 31,
                               2001          2000         2001          2000
     Income Statement Data:
      Interest income       $10,469        $9,301      $40,523       $35,567
      Interest expense        3,608         3,567       15,486        12,509
      Net interest income     6,861         5,734       25,037        23,058
      Provision for
       loan losses              224           122          600           500
      Net interest income
       after provision for
       loan losses            6,637         5,612       24,437        22,558
      Other income              769           495        2,658         2,009
      Trust Fees              1,044           773        4,013         3,604
      Other expense           4,923         4,222       17,823        16,020
      Merger-related charges      0             0            0           500
      Income before income
       taxes                  3,527         2,658       13,285        11,651
      Income tax expenses     1,121           873        4,361         3,943
      Net income             $2,406        $1,785       $8,924        $7,708
 
     Balance Sheet Data:
      Total assets                                    $704,773      $567,032
      Federal funds sold                                 2,543        36,376
      Short-term investments                            15,634           910
      Securities held to maturity                       48,722        69,574
      Securities available for sale
 172,620        83,951
      Loans, net                                       412,910       340,864
      Deposits                                         630,903       508,879
      Stockholders' equity                              63,085        55,156
 
     Average Balance Sheet Data:
      Total Assets         $681,253      $536,253     $628,833      $523,168
      Earning Assets        637,393       506,215      594,180       493,028
      Loans, net            408,248       334,839      378,748       315,898
      Interest-Bearing
      Deposits              503,289       374,519      460,782       373,636
      Demand Deposits       104,148       104,381      102,852        95,621
      Borrowings              5,473             0        1,633             0
      Stockholders' equity   62,566        53,844       59,373        50,380
 
     Performance Ratios:
      Return on average
       assets                1.41 %        1.33 %       1.42 %        1.47 %
      Return on average
       equity                 15.38         13.26        15.03         15.30
 
     Net Interest Margin
      (Taxable Equivalent
       Basis)                4.27 %        4.40 %       4.16 %        4.56 %
 
     Efficiency Ratio       56.76 %       60.30 %      56.21 %       57.62 %
 
     Performance Ratios:
     (Before Merger-Related Charges)
      Return on average
       assets                1.41 %        1.33 %       1.42 %        1.55 %
      Return on average
       equity                 15.38         13.26        15.03         16.14
 
     Asset Quality:
      Loans past due over 90 days
       and still accruing                                  $53           $75
      Non-accrual loans                                    274           325
      Net recoveries
      /(charge-offs)          $(26)           $95         (12)          (27)
      Allowance for loan
       losses to total loans                            0.96 %        1.00 %
 
     Per Share Data: (1)
      Earnings per share
       (Basic)                $0.72         $0.54        $2.68         $2.32
     Earnings per share
      (Diluted)                0.71          0.53         2.64          2.27
      Book Value                                         18.96         16.61
 
     Per Share Data:
      (Before Merger-Related
       Charges) (1)
      Earnings per share
       (Basic)                $0.72         $0.54        $2.68         $2.45
      Earnings per share
       (Diluted)               0.71          0.53         2.64          2.40
 
     Capital Adequacy:
      Tier I Leverage                                   9.84 %       10.49 %
      Tier I Capital to Risk-Weighted Assets             18.76         20.80
      Tier I & Tier II
      Capital to Risk-Weighted Assets                    19.98         22.10
 
     (1) Restated for the 10% stock dividend declared September 13, 2001.
 
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SOURCE Peapack-Gladstone Financial Corporation

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