Peoples Financial Corporation Earns $3,220,000 in 2009

Loan loss reserve increased by $1.5 million in fourth quarter

Jan 27, 2010, 16:31 ET from Peoples Financial Corporation

BILOXI, Miss., Jan. 27 /PRNewswire-FirstCall/ -- Peoples Financial Corporation (Nasdaq: PFBX), parent of The Peoples Bank, earned $3,220,000 for the year, announced Chevis C. Swetman, Chairman and Chief Executive Officer of the holding company and the bank.

Earnings for 2009 were 36% lower than earnings for 2008 due mainly to additions to the bank's loan loss reserves totaling $5,225,000.

"We are enduring short-term pain to position our bank for long-term growth as we emerge from the worst recession of our lifetime," said Swetman. "While many of our operating results are positive, we are nevertheless taking the unpleasant, difficult steps now to purge our loan portfolio of any problems," he said.

The loan loss reserve at the end of 2009 was $7,828,000, while charge-offs and recoveries for the year totaled $9,080,000 and $569,000, respectively.

Earnings per share for the year totaled $.62, compared to $.94 per average weighted share in 2008. Earnings per share figures are based on average weighted shares outstanding of 5,170,430 and 5,342,470 for the twelve months ended December 31, 2009 and 2008, respectively.

Loan balances at the end of 2009 totaled $465 million, essentially the same as the $467 million recorded at the end of 2008. "Our senior management has remained vigilant in evaluating the quality of every one of our loans. We feel comfortable with the quality of our portfolio as we enter what we hope will be a slow but steady recovery phase in our national and local economies," said Swetman.

"Our historic philosophy of maintaining a strong capital base is helping our bank survive the worst financial environment we have experienced in our lifetime. At the end of 2009, our primary capital was 12.49%, well beyond what regulators require but consistent with the policies we have historically set for ourselves," he said.

Founded in 1896, with $869 million in assets as of December 31, 2009, The Peoples Bank operates 16 branches along the Mississippi Gulf Coast in Hancock, Harrison, Jackson and Stone counties. In addition to a comprehensive range of retail and commercial banking services, the bank also operates a trust and investment services department that has provided customers with financial, estate and retirement planning services since 1936. The bank also operates a mortgage loan department providing residential loans for primary, secondary and multi-family homes up to four units.

The Peoples Bank is a wholly-owned subsidiary of Peoples Financial Corporation, listed on the NASDAQ Capital Market under the symbol PFBX. Additional information is available on the Internet at www.thepeoples.com.

This news release contains forward-looking statements and reflects industry conditions, company performance and financial results. These forward-looking statements are subject to a number of risk factors and uncertainties which could cause the Company's actual results and experience to differ from the anticipated results and expectation expressed in such forward-looking statements.

    
    
    
    
    PEOPLES FINANCIAL CORPORATION                                      
    (Unaudited) (In thousands, except weighted average shares and      
     per share figures)                                                
                                                                       
                                      Three Months Ended         Year Ended  
    EARNINGS SUMMARY                     December 31,           December 31, 
    ----------------                  ------------------       ------------- 
                                       2009        2008       2009       2008
                                       ----        ----       ----       ----
    Net interest income              $7,026      $7,108    $26,888    $28,610
    Provision for loan losses         1,500         252      5,225      2,347
    Non-interest income               2,762        (711)    10,146      7,268
    Non-interest expense              7,327       3,866     27,636     26,521
    Income taxes                        619         459        954      1,977
    Net income                          342       1,820      3,220      5,034
    Earnings per share                  .06         .35        .62        .94
                                                                          
    TRANSACTIONS IN THE ALLOWANCE FOR LOAN LOSSES                     
    ---------------------------------------------                     
                                      Three Months Ended        Year Ended   
                                         December 31,           December 31, 
                                      ------------------       -------------
                                       2009        2008       2009       2008
                                       ----        ----       ----       ----
    Allowance for loan losses                                           
     beginning of period             $8,107     $10,983    $11,114     $9,378
    Recoveries                          234         341        569        673
    Charge-offs                      (2,013)       (462)    (9,080)    (1,284)
    Provision for loan losses         1,500         252      5,225      2,347
                                      -----         ---      -----      ----- 
    Allowance for loan losses end of                                         
     period                          $7,828     $11,114     $7,828    $11,114 
                                     ======     =======     ======    ======= 
                                                                              
    ASSET QUALITY                        December 31,                         
    -------------                        ------------                         
                                       2009        2008                   
                                       ----        ----                   
    Allowance for loan losses as a                                         
     percentage of loans              1.68%       2.38%                   
    Loans past due 90 days and                                             
     still accruing                  $4,218      $2,340                   
    Nonaccrual loans                 22,006      15,553                   
                                                                     
    PERFORMANCE RATIOS (annualized)      December 31,                   
    -------------------------------      ------------                   
                                       2009        2008             
                                       ----        ----             
    Return on average assets           .36%        .55%            
    Return on average equity          3.06%       4.73%            
    Net interest margin               3.36%       3.62%            
    Efficiency ratio                    87%         79%            
    Primary capital                  12.49%      12.81%            
                                                                 
    BALANCE SHEET SUMMARY                December 31,            
    ---------------------                ------------            
                                       2009        2008          
                                       ----        ----          
    Total assets                   $869,007    $896,408          
    Loans                           464,976     467,377          
    Securities                      323,689     349,816          
    Other real estate (ORE)           1,521         397          
    Total deposits                  470,701     510,476          
    Total federal funds purchased   174,431     226,609         
    Shareholders' equity            103,588     107,000         
    Book value per share              20.11       20.27         
    Weighted average shares       5,170,430   5,342,470         
    
    
    

SOURCE Peoples Financial Corporation



RELATED LINKS

http://www.thepeoples.com