Record Nine Month Net Income of $10.0 Million Up 56% Compared to Prior Year Period
Asset Quality Metrics Remain Strong and Continue to Improve in the Third Quarter
MADISON, Wis., Oct. 24, 2013 (GLOBE NEWSWIRE) -- First Business Financial Services, Inc. (the "Company") (Nasdaq:FBIZ), the parent company of First Business Bank and First Business Bank - Milwaukee, today reported continued strong performance for 2013, with third quarter and nine month earnings up significantly compared to the prior year periods. This strong year-to-date 2013 momentum is being driven by a continued focus on consistent high quality loan growth, steadily improving asset quality and efficient execution of the Company’s initiatives to increase full banking relationships with businesses, executives and high net worth individuals.
Highlights for the quarter and nine months ended September 30, 2013 include:
- Net income totaled a record $3.6 million for the third quarter of 2013, an increase of $987,000 from the third quarter of 2012.
- Record net income of $10.0 million for the nine months ended September 30, 2013 increased by $3.6 million, compared to the first nine months of 2012.
- Pre-tax adjusted earnings, defined as pre-tax income excluding the effects of provision for loan and lease losses, other identifiable costs of credit and other discrete items unrelated to the Company’s primary business activities, grew 15% to a record $5.6 million for the third quarter of 2013, compared to $4.9 million earned in the third quarter of 2012. Pre-tax adjusted earnings of $15.6 million for the first nine months of 2013 improved 16% over the prior year.
- At a record 1.14%, third quarter 2013 annualized return on average assets exceeded 1.0% for the third consecutive quarter, increasing 26 basis points compared to the third quarter of 2012, and improving 12 basis points from the linked second quarter.
- Annualized return on average equity was 13.73% for the quarter ended September 30, 2013, compared to 15.10% for the same period in 2012. The return on average equity declined year over year despite record net income due to the addition of $27.1 million of equity raised in the Company’s December 2012 common stock offering.
- Top line revenue, consisting of net interest income and non-interest income, was a record $12.8 million for the third quarter of 2013, an increase of $659,000, or 5%, compared to the third quarter of 2012. Top line revenue grew 8% to $37.4 million for the first nine months, compared to the same period of 2012.
- Trust assets under management and administration as of September 30, 2013 were a record $910.8 million, an increase of $164.7 million, or 22%, from September 30, 2012.
- The Company’s efficiency ratio of 56.11% was its fifth consecutive quarter below 60%.
- Average loans and leases grew for the sixth consecutive quarter to a record $939.1 million, an increase of $8.0 million, or an annualized 3.4%, from the second quarter of 2013, and an increase of $60.3 million, or 6.9%, from the third quarter of 2012.
- Net interest margin was 3.56% for the three months ended September 30, 2013, compared to 3.50% for the same period of 2012. The year-to-date net interest margin of 3.52% improved 14 basis points compared to 3.38% for the same period of 2012.
- Non-performing assets of $10.3 million at September 30, 2013 decreased by $5.4 million, or 34%, from December 31, 2012, and by $4.7 million, or 31%, from September 30, 2012. Non-performing assets improved to 0.82% of total assets as of September 30, 2013, down 44 basis points from September 30, 2012 and 46 basis points from December 31, 2012.
The Company recorded net income of $3.6 million in the third quarter of 2013, an increase of 38% compared to $2.6 million earned in the third quarter of 2012. Diluted earnings per common share were $0.91 for the third quarter of 2013 compared to $0.99 for the same period in 2012. The Company’s net income for the nine months ended September 30, 2013 was $10.0 million, or $2.54 per diluted common share, compared to net income of $6.4 million, or $2.43 per diluted common share, earned in the nine months ended September 30, 2012. Third quarter 2013 and year-to-date 2013 earnings per share reflect the issuance and sale of 1,265,000 shares of common stock in December 2012. The Company’s weighted-average diluted common shares outstanding during the 2013 periods were approximately 51% higher than in the corresponding periods of 2012 as a result of the issuance and sale of these shares.
"Our trend line of improved results extended through the third quarter of 2013 with net income up nearly 40%," said Corey A. Chambas, President and Chief Executive Officer. "Our consistent strong performance reflects a measured approach to growth with a continuous focus on high-quality organic loan generation, along with a commitment to invest in the talent required for future growth and profitability. While many institutions are attempting to grow through acquisitions, we believe we have carved out an attractive niche that presents an excellent opportunity for steady and profitable long-term growth for the Company, along with value creation for our investors. Our nimble business model is well suited for addressing the growth opportunities available in our space, and we are committed to building incremental value as a strong independent banking institution."
Read the full press release on the Investor Relations section of our website.