WCBO West Coast Bancorp (MM)

• On September 25, 2012, the Company Declared a Cash Dividend of $.05 Per Common Share, Payable on October 31, 2012, to Shareholders of Record as of October 10, 2012, With Series B Preferred Shares Participating on an As-Converted Basis.
• Net Income for the Third Quarter 2012 Was $5.9 Million or $6.3 Million Adjusting for After-Tax Merger-Related Expenses*.
• Third Quarter 2012 Return on Average Assets Was .97% or 1.03% Excluding After-Tax Merger-Related Expenses*, an Improvement From the Same Quarter in 2011.
• Total Noninterest Expense Was $21.3 Million in Third Quarter 2012; Excluding Merger-Related Expenses*, Noninterest Expense of $20.7 Million Declined 8% From the Corresponding Quarter in 2011.
• Third Quarter 2012 Efficiency Ratio, Excluding Merger-Related Expenses*, Improved to 68.7% From 81.0% in the Same Quarter in 2011.
• Net Income for the Nine-Month Period Ending September 30, 2012, Excluding After-Tax Merger-Related Expenses, Increased 13% From the Same Period in 2011.
• On September 26, 2012, the Company Announced an Agreement and Plan of Merger With Columbia Banking System, Inc., Headquartered in Tacoma, Washington, With Assets of $4.9 Billion at September 30, 2012. The Merger is Subject to Customary Closing Conditions, Including Receipt of Requisite Shareholder and Regulatory Approvals.

West Coast Bancorp (Nasdaq:WCBO) ("Bancorp" or "Company"), the parent company of West Coast Bank ("Bank") and West Coast Trust Company, Inc., today announced third quarter 2012 net income of $5.9 million or $.27 per diluted share compared to net income of $6.3 million or $.29 per diluted share in the third quarter of 2011. Net income for the first nine months of 2012 was $17.8 million or $.82 per diluted share compared to net income of $16.0 million or $.75 per diluted share in the same period of 2011.

"The operating performance of the Company continued its positive trend in the third quarter of 2012 compared to prior periods," said Robert D. Sznewajs, President and Chief Executive Officer. "This trend is evidenced by the Board of Director's declaration of a shareholder cash dividend and a continuing improvement in our return on assets, influenced by effective cost control measures and reduced loan loss provisioning due to an improving credit environment. Our recently announced merger with Columbia Bank will further expand the Company's presence in Washington and create the premier community bank in the Pacific Northwest."

Table 1 below shows the reconciliation of net income to the non-GAAP measures of net income excluding after-tax merger-related expenses and of noninterest expense to noninterest expense excluding merger-related expenses for the quarters ended September 30, 2012, and 2011, and the years to date ended September 30, 2012, and 2011.

As previously announced on September 26, 2012, Bancorp entered into an Agreement and Plan of Merger with Columbia Banking System, Inc. ("Columbia"), providing for the acquisition of Bancorp by Columbia for consideration consisting of a combination of cash and Columbia common stock on the terms set forth in the merger agreement. Consummation of the transaction remains subject to customary closing conditions, including receipt of requisite shareholder and regulatory approvals. Table 2 below shows summary financial information for the quarters ended September 30, 2012, and 2011, and June 30, 2012.

Balance Sheet Overview

Third quarter 2012 total average loan balance of $1.49 billion increased $14 million or 1% from the preceding quarter, with growth primarily in the commercial real estate construction and commercial real estate portfolios. Total average loans for the quarter ended September 30, 2012, declined $22 million or 1% from the third quarter in 2011, with declines in home equity and mortgage loans more than offsetting the year-over-year increase in commercial real estate construction loans. The yield on the loan portfolio of 4.98% in the most recent quarter declined 27 basis points from the corresponding quarter in 2011 and 10 basis points from the previous quarter as higher yielding loans in the portfolio continued to pay off or be refinanced while new loans were originated at lower yields reflecting prevailing market interest rates.

Third quarter average investment portfolio of $761 million remained a sizeable portion of total average earning assets and represented 33% of earning assets as of September 30, 2012. Over the past year, the Company has increased its investments in municipal securities and reduced its U.S. government agency portfolio. During this time, purchases consisted principally of Oregon and Washington school district municipal securities with State guarantees and 10-year and 15-year fully amortizing U.S. government agency mortgage-backed securities. The expected duration of the investment portfolio was approximately 2.7 years at September 30, 2012, compared to approximately 2.3 years twelve months ago.

The third quarter 2012 tax equivalent yield on total cash and investment securities balances was 2.12%, a decline of 23 basis points from the same quarter in 2011, and a decline of 17 basis points from the preceding quarter.

Average total deposits of $1.91 billion in the third quarter 2012 increased 2% or $36 million from the prior quarter, as average non-interest bearing demand deposits increased $56 million and more than offset an $11 million decline in average time deposit balances. Time deposits represented 7% of the Company's average total deposits in the most recent quarter compared to 10% during the same quarter of 2011. Year-over-year third quarter average total deposit balances declined $44 million or 2%, with average money market and time deposit balances declining $70 million and $57 million, respectively. Partly offsetting these declines, non-interest bearing demand and savings deposits grew $62 million and $18 million, respectively, over the same period.

Third quarter 2012 average total checking balances of $1.04 billion grew $64 million or 7% from third quarter 2011 and represented 55% of the Company's average total deposits in the quarter. Lower market interest rates and a continuing shift in the mix from time deposits to non-time deposits over the past year reduced the average rate paid on total deposits to 8 basis points in the most recent quarter, representing a decline of 12 basis points from the same quarter in 2011.

Capital Position

As shown in Table 6 below, the Company improved its September 30, 2012, capital position compared to twelve months earlier. As a result of the Company's operating performance and capital position, the Company announced a shareholder dividend of $.05 per share on September 25, 2012. The dividend will be payable on October 31, 2012, to shareholders of record on October 10, 2012.

Operating Results

As shown in Table 7 below, pre-tax income, excluding merger-related expenses, in the third quarter of 2012 was $9.7 million, an increase of $5.7 million or 143% from the third quarter last year. The increase was principally due to an increase in net interest income, a lower provision for loan losses, and a reduction in noninterest expense. For sequential quarters, pre-tax income increased $.4 million or 5% mainly as a result of reductions in noninterest expenses. Third quarter 2012 net income of $6.3 million, excluding merger-related expenses, increased modestly from the corresponding quarter last year and $.3 million or 5% from the prior quarter. See Table 1 for reconciliation of net income to non-GAAP financial measure.

Third quarter 2012 net interest income of $21.7 million increased $2.3 million from the same quarter in 2011. This was primarily a result of the $2.8 million prepayment charge incurred in third quarter 2011 in conjunction with a $88 million prepayment of FHLB term borrowings. As shown in Table 8 below, the third quarter 2012 net interest margin of 3.80% increased 2 basis points from the net interest margin adjusted for the prepayment charge in the same quarter of 2011. For the sequential quarters, the net interest margin contracted 13 basis points principally as a result of declining yield on investment and loan portfolios.

As shown in Table 9 below, third quarter 2012 total noninterest income of $8.2 million decreased $.2 million or 3% from the same quarter in 2011. The decline can be attributed to a $.7 million decrease in gains on sales of OREO, lower service charges on deposit accounts and payment systems-related revenues and no gains on sales of securities in the most recent quarter. These declines were partly offset by an increase in gains on sales of loans, higher trust and investment services revenues, and a reduction in OREO valuation adjustments. Total net loss on OREO was $.5 million in the quarter ended September 30, 2012, as compared to virtually no net OREO loss in the same quarter of 2011. Total noninterest income in the third quarter of 2012 decreased 3% or $.3 million from the second quarter of 2012, as a lower total net loss on OREO did not offset declines in remaining non-interest income categories.

Excluding the total net loss on OREO, the Company's third quarter noninterest income grew $.2 million on a year-over-year basis, while declining $.9 million from the prior quarter. For sequential quarters, the Company recognized $.4 million less in gains on sales of Small Business Administration loans and no gains on sales of securities in the most recent quarter.

As shown in Table 10 below, the Company's third quarter 2012 total noninterest expense of $20.7 million, excluding merger-related expenses, declined by $1.9 million or 8% from the same quarter in 2011. As a result of cost-savings initiatives implemented over the past year, expenses declined in nearly all categories from the corresponding quarter in 2011. On a linked quarter basis, total noninterest expenses, excluding merger-related expenses, declined $.7 million or 3%. See Table 1 for reconciliation to GAAP measure.

Income Taxes

The third quarter 2012 provision for income taxes was $3.2 million compared to a benefit for income taxes of $2.3 million in the same quarter of 2011. The third quarter 2012 provision for income taxes was the result of an effective tax rate of 35% on pre-tax income. The provision for taxes in the third quarter last year reflected the impact of the Company's deferred tax asset valuation allowance at September 30, 2011, which was subsequently fully reversed in the fourth quarter of 2011.

Credit Quality

The Company recorded a benefit for credit losses of $.6 million in the third quarter of 2012, compared to a provision for credit losses of $1.1 million in the third quarter of 2011 and benefit of $.5 million in the previous quarter. Net charge-offs in the third quarter of 2012 were $1.0 million or .27% of average loans on an annualized basis, representing a decline from $3.3 million or .88%, respectively, in the corresponding quarter in 2011 and an increase of $.2 million on a linked-quarter basis. As shown in the table below, net charge-offs declined in nearly all loan categories compared to the third quarter last year.

The allowance for credit losses was $32.3 million or 2.17% of total loans at September 30, 2012, compared to an allowance for credit losses of $37.0 million or 2.46% of total loans a year earlier and $33.9 million or 2.27%, respectively, at June 30, 2012. The decline in the allowance for credit losses and the allowance relative to total loans over both periods reflected the improving trend in the overall risk profile of the loan portfolio as evidenced by modest charge off activity, low delinquency, and a positive risk rating migration. The allowance for credit losses relative to nonperforming loans increased from 70% a year ago to 100% at September 30, 2012. The Company's estimate of the allowance for credit losses will continue to be closely correlated to the loan portfolio's credit quality performance trends and the region's economic conditions.

Total nonperforming assets at September 30, 2012, were $54.3 million or 2.19% of total assets, and represented a 35% reduction from $83.1 million or 3.30% of total assets a year ago, and a decline of 8% from $59.3 million or 2.46% of total assets as of June 30, 2012.

Over the past twelve months, total nonaccrual loans declined $20.5 million or 39% to $32.4 million at September 30, 2012.

As indicated in Table 13 below, during the most recent quarter the Company disposed of 29 OREO properties with a book value of $3.8 million while acquiring three properties with a book value of $.5 million. OREO valuation adjustments totaled $.5 million in the most recent quarter, down from both third quarter last year and the preceding quarter of 2012. The combination of these transactions resulted in a $3.8 million or 15% net reduction in total OREO during the quarter to $21.9 million at September 30, 2012. The OREO balance reflected write-downs of 57% from original loan principal. Income-producing properties represented the largest balance in the OREO portfolio at September 30, 2012, followed by land and homes, substantially all of which are located within the Company's footprint.

Other

The Company will hold a Webcast conference call Thursday, October 25, 2012, at 11:00 a.m. Pacific Time, during which the Company will discuss third quarter 2012 results and current activities. To access the conference call via a live Webcast, go to www.wcb.com and click on Investor Relations and the "3rd Quarter 2012 Earnings Conference Call" tab. The conference call may also be accessed by dialing (866) 394-3464, Conference ID#: 37304304 a few minutes prior to 11:00 a.m. Pacific Time. The call will be available for replay by accessing the Company's website at www.wcb.com and following the same instructions.

West Coast Bancorp is a publicly held, Northwest bank holding company headquartered in Oregon with $2.5 billion in assets, and the parent company of West Coast Bank and West Coast Trust Company, Inc. West Coast Bank operates 58 branches in Oregon and Washington. The Company serves clients who seek the resources, sophisticated products and expertise of larger financial institutions, along with the local decision-making, market knowledge, and customer service orientation of a community bank. The Company offers a broad range of banking, investment, fiduciary and trust services.  For more information, please visit the Company web site at www.wcb.com.

The West Coast Bancorp logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=13726

Forward Looking Statements

Statements in this release regarding future events, performance or results are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 ("PSLRA") and are made pursuant to the safe harbors of the PSLRA. These statements can often be identified by words such as "expects," "believes," "projects," "anticipates," or "will," or other words of similar meaning, and specifically include in this release all statements regarding the expected future benefits of our ongoing cost-cutting initiatives. Actual results could be quite different from those expressed or implied by the forward-looking statements, which give our current expectations about the future and are not guarantees. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them to reflect changes that occur after that date.

A number of factors could cause results to differ significantly from our expectations, including, among others, the effects of (i) market conditions in our service areas on our efforts to continue to reduce our levels of nonperforming assets and increase loan originations, (ii) cost reduction initiatives, (iii) any failure to satisfy the conditions to our proposed merger with Columbia Banking System, Inc., including receipt of regulatory and shareholder approvals, and (iv) risk factors identified in our Annual Report on Form 10-K for the year ended December 31, 2011, including under the heading "Forward Looking Statement Disclosure" and in the section "Risk Factors," in our most recent Quarterly Report on Form 10-Q for the quarter ended June 30, 2012, and in our Current Report on Form 8-K dated September 25, 2012, including under the heading "Cautionary Statements Regarding Forward Looking Information."

* This press release contains certain non-generally accepted accounting principles in the United States of America ("GAAP") financial measures including net income, excluding after-tax merger-related expenses. Management uses this non-GAAP information internally and has disclosed it to investors based on its belief that the information provides additional, valuable information relating to its operating performance as compared to prior periods. Please see Table 1 for a reconciliation of net income to net income excluding after-tax merger-related expenses and noninterest expense to noninterest expense excluding merger-related expenses.

CONTACT: Robert D. Sznewajs
         President & CEO
         (503) 598-3243
         
         Anders Giltvedt
         Executive Vice President & CFO
         (503) 598-3250

West Coast Bancorp (MM) (NASDAQ:WCBO)
Graphique Historique de l'Action
De Oct 2024 à Nov 2024

West Coast Bancorp (MM) (NASDAQ:WCBO)
Graphique Historique de l'Action
De Nov 2023 à Nov 2024