Puget Sound Bank Second Quarter Profits Jump 27%; Return on Equity Increases 38%; Record First Half Net Income of $1,043,446

BELLEVUE, Wash., July 18, 2012 /PRNewswire/ -- Puget Sound Bank (OTCBB: PUGB.OB), today reported that net income for second quarter increased 27% to $526,381, or $.21 per share compared to $413,145, or $.15 per share for second quarter 2011. Net income for the first six months increased 20% from the same period a year ago to $1,043,446.

"Puget Sound Bank continues to produce consistently strong earnings driven by solid loan and deposit growth and improving credit quality," said Jim Mitchell, President and Chief Executive Officer. "We are very pleased that the bank's nonperforming loans are just 0.75% of total assets, which is among the lowest levels in the State."

Loans grew 11% to $195 million from $175 million in second quarter 2011.  Commercial and industrial (C&I) loans, including owner-occupied commercial real estate loans, accounted for 62% of the loan portfolio at the end of the quarter. 

Deposits grew 11% to $217 million from $197 million a year ago.  Noninterest-bearing deposits increased 28% from second quarter 2011 and accounted for 34% of total deposits, compared to 29% a year ago. 

Second Quarter Highlights:

  • Return of equity increased 38% to 8.08% from 5.83% a year earlier.
  • Return on assets increased 17% to 0.87% from 0.75% in second quarter 2011.
  • Total loans grew 11% from a year ago, to $194.7 million.
  • Non-interest bearing demand deposits increased 28% from second quarter 2011, to $73.9 million, 34% of total deposits.
  • The net interest margin (NIM) was 4.26% for the quarter, down from 4.57% a year ago.
  • Tangible book value per share grew 5% to $10.62 from a year earlier.
  • Nonperforming assets to total assets ratio of 0.75%, down from 0.99% in prior quarter and down from 1.19% in second quarter 2011.
  • Allowance for Loan and Lease Losses was 1.50%.
  • Capital ratios continue to substantially exceed regulatory requirements for a well-capitalized financial institution with total risk-based capital at 16.9%.
  • The efficiency ratio was 65%.
  • Puget Sound Bank was recognized by the Puget Sound Business Journal as a finalist for Washington's Best Workplaces in 2012.
  • Puget Sound Bank was awarded a 5-Star rating for the seventh consecutive quarter, which is the highest rating available from BauerFinancial, Inc., an independent banking rating agency.

About Puget Sound Bank
Puget Sound Bank is a locally-owned and operated commercial bank proudly serving the greater Puget Sound region.  Based out of Bellevue, Washington, the bank was founded to meet the specialized needs of small and medium-sized businesses, commercial real estate projects, professionals and individuals seeking a higher level of service in the Puget Sound region.  Staffed by the most experienced, customer-oriented banking professionals in the region, Puget Sound Bank offers a full range of competitive financial products with superior customer service and a consultative/partnership approach to its clients.  Puget Sound Bank provides online banking at www.pugetsoundbank.com and has access to a large branch network in the state of Washington.  The bank can also provide remote capture technology which allows its clients to make deposits from their offices.  Puget Sound Bank is located at 10500 NE 8th Street, Suite 1500, Bellevue, Washington.  For more information, please call 425-455-2400.

Safe Harbor Statement. This news release contains comments or information that constitutes forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are based on current expectations that involve a number of risks and uncertainties. Actual results may differ materially from the results expressed in forward-looking statements.  Factors that might cause such a difference include changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking regulation; changes in tax laws; changes in prices; levies and assessments; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; changes in the national and local economy; and other factors, including risk factors, referred to from time to time in filings made by Puget Sound Bank with the Securities and Exchange Commission.  Puget Sound Bank undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.

 

Puget Sound Bank

Second Quarter 2012 


CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited)











Quarterly





2012

2012


2011


2012

2011

($ in thousands except per share data)


2nd Qtr

1st Qtr


2nd Qtr


YTD

YTD










EARNINGS









   Net interest income

$

2,471

2,578


2,430


5,049

4,695

   Provision for loan losses

$

111

223


295


334

308

   Net interest income after provision for loan losses

2,360

2,355


2,135


4,715

4,387

   NonInterest income

$

95

118


98


213

188

   NonInterest expense

$

1,667

1,699


1,618


3,366

3,281

   Pre-tax Net income

$

788

774


615


1,562

1,295

   Provision for income taxes (benefit)

$

262

257


202


519

425

   Net income

$

526

517


413


1,043

869

   Preferred dividends

$

25

25


73


49

145

   Net income available to common shareholders

$

501

492


340


994

724

   (1)Earnings per share

$

0.21

0.21


0.15


0.42

0.31

   Average shares outstanding


2,349

2,344


2,312


2,346

2,309

   Total revenue

$

2,566

2,696


2,528


5,262

4,884

PERFORMANCE RATIOS









   Return on average assets


0.87%

0.85%


0.75%


0.86%

0.79%

   (1)Return on average common equity


8.08%

8.08%


5.83%


8.08%

6.27%

   Net interest margin


4.26%

4.44%


4.57%


4.35%

4.47%

   Efficiency ratio


65.0%

63.0%


64.0%


64.0%

67.2%










CAPITAL









   Tier 1 leverage ratio


14.32%

14.05%


12.55%




   Tier 1 risk-based capital ratio


15.63%

15.67%


13.74%




   Total risked based capital ratio 


16.88%

16.92%


14.99%




   Tangible Common Equity Ratio


9.85%

10.32%


10.37%













ASSET QUALITY









   Net loan charge-offs (recoveries)

$

486

317


235




   Allowance for loan losses

$

2,912

3,288


3,233




   Allowance for losses to total loans


1.50%

1.75%


1.84%




   Nonperforming loans

$

1,906

2,346


2,687




   Other real estate owned

$

0

0


0




   Nonperforming assets to total assets


0.75%

0.99%


1.19%




 

Puget Sound Bank

Second Quarter 2012 


CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)





Quarterly



2012


2012



2011

($ in thousands except per share data)


2nd Qtr


1st Qtr



2nd Qtr









BALANCE SHEET
















 Cash and Due From Banks 

$

7,198


6,070



5,898

 Investments 

$

49,048


40,834



41,917

 Commercial and Industrial Loans 

$

81,541


75,359



73,705

 Owner-Occupied Commercial Real Estate 

$

37,750


36,749



36,934

 Other Commercial Real Estate 

$

54,352


53,175



46,325

 Personal Loans 

$

19,436


20,099



16,050

 Non-accrual Loans 

$

1,906


2,347



2,687

 Deferred Loan Fees 

$

(296)


(242)



(307)

    Total Loans 

$

194,689


187,487



175,394

 Allowance for Loan Losses 

$

(2,912)


(3,288)



(3,233)

   Net Loans 

$

191,777


184,199



172,161

 Other Assets 

$

5,246


4,958



5,412

 Total Assets 

$

253,269


236,061



225,388









 Non-interest bearing Demand  

$

73,926


63,706



57,823

 Interest Bearing Demand  

$

18,101


17,562



7,267

 Money Market and Savings 

$

71,468


71,955



63,728

 Certificates of Deposit 

$

53,759


47,623



67,736

    Total Deposits 

$

217,254


200,846



196,554

 Borrowings 


-


-



-

Other Liabilities

$

1,186


978



839

Total Equity

$

34,829


34,237



27,995

   Total Liabilities and Equity

$

253,269


236,061



225,388









   Shareholders' equity

$

24,943


24,351



23,383

   Tangible book value per share


10.62


10.37



10.11









(1)Includes preferred stock dividends not included in net income.






 

SOURCE Puget Sound Bank



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