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ABIGAIL
ADAMS NATIONAL BANCORP, inc.
REPORTS SECOND QUARTER EARNINGS
Washington, DC
- Abigail Adams National Bancorp, Inc. (NASDAQ:AANB) announced
today that net income for the second quarter ended June 30, 2006 was $788,000,
or $0.23 per diluted share. Net income for the same period in 2005 was
$944,000 or $0.28 per diluted share. The return on average assets for the
second quarter 2006 was 0.87% and the return on average equity was 11.16%,
compared to 1.47% and 14.90%, respectively, for the second quarter of 2005.
The results of operations for Consolidated Bank and Trust (“CBT”) are
included subsequent to the close of business on July 29, 2005 and, therefore,
included in the 2006 quarterly numbers.
The net income for the first six months
ended June 30, 2006 was $1.4 million or $0.42 per diluted share, a decrease
compared to the $1.9 million or $0.56 per diluted share reported for the same
period in 2005. The return on average equity was 10.27% and the return on
average assets was 0.81% for 2006, as compared to 14.92% and 1.49% reported in
2005, respectively.
Jeanne D. Hubbard, President and CEO of
Abigail Adams National Bancorp and its primary subsidiary, The Adams National
Bank, commented, “The decision to maintain Consolidated Bank & Trust as
a separate bank should have significant long term benefits for the company
that will negate the short term impact to earnings due to operating it as an
affiliate bank under a separate charter.
CBT is celebrating its 103rd birthday this month and thus
has a long tradition of serving the banking needs of its communities.
Such a rich and notable tradition and history should prove to be a
strength in the future for our company and provide an excellent opportunity
for growth and additional profitability.”
Due to a 41.0% increase in average
earning assets (with CBT contributing 72.5% of the growth, and the rising
interest rate environment), net interest income for the second quarter of 2006
increased 26.3% to $4.0 million, compared to $3.1 million for the same period
in 2005. This increase was offset
by the decrease in the overall net interest margin to 4.61%, compared to 5.15%
reported for the same period in 2005.
For the first six months ended June 30,
2006, net interest income increased 25.0% to $7.8 million, compared to $6.3
million for the same period in 2005. The
increase was due to a 42.7% growth in the Company’s loan portfolio. Average
loans increased $78.0 million, with the CBT acquisition contributing 53.5% of
the year-over-year loan growth. The
net interest margin was 4.67% for the period ended June 30, 2006, down from
the 5.26% reported for the same period in 2005. The decline was due to a
competitive environment for deposits and loans, and the pressure of a flat
yield curve on repricing assets and deposits.
The Company’s assets totaled $372.1
million at June 30, 2006, an increase of $114.3 million or 44.3%, compared to
assets at June 30, 2005. The CBT acquisition contributed 70.8% of the
year-over-year asset growth. Loans increased $81.6 million from June 30, 2005. Loan growth was driven by growth in the construction,
commercial and commercial real estate markets in the Company’s locations.
The Company’s asset quality remains
strong. Nonperforming loans and
OREO totaled $1.7 million or 0.61% of period end loans and OREO, an increase
from 0.29% at June 30, 2005. Approximately
43.5% of the nonperforming loans are guaranteed by the Small Business
Administration. The allowance for loan losses was $4.7 million at June 30,
2006, representing 1.71% of total loans, compared to 1.42% at June 30, 2005.
The ratio of nonperforming loans to total assets was 0.45%, an increase from
0.22% reported at June 30, 2005. Net recoveries for the year were $203,000.
The provision for loan losses was $125,000 for 2006, compared to $100,000 for
2005.
Deposits totaled $303.5 million at June
30, 2006, an increase of $81.5 million, or 36.7%, compared to the same period
in 2005. The CBT acquisition contributed approximately 88.4% of the growth in
deposits. Wholesale borrowings increased to $27.1 million and were used to
fund the asset growth in 2006. Long term debt was $10.8 million, compared to
$6.7 million, as a result of the note used to fund the capital infusion to CBT
in 2005.
Noninterest income for the second quarter
of 2006 was $545,000, compared to $502,000 for the same period in 2005. The
gain on sale of loans in the second quarter was $153,000, compared to $159,000
in the second quarter of 2005.
Noninterest income for the period ended
June 30, 2006 was $1.0 million, compared to $930,000 for the same period in
2005. The gain on sale of loans in 2006 was $181,000, compared to $192,000 for
the same period in 2005.
Noninterest expense was $3.1 million for
the second quarter of 2006, compared to $2.0 million for the second quarter of
2005, a 53.5% increase. The increase in noninterest expense was primarily due
to the acquisition of CBT, which added an additional $936,000 for the quarter.
Noninterest expense was $6.4 million for
the period ended June 30, 2006, compared to $4.0 million for the same period
in 2005, a 58.7% increase. The increase in noninterest expense was primarily
due to the acquisition of CBT, which added an additional $1.9 million in 2006.
At June 30, 2006, the Company had approximately 107 full-time equivalent
employees, compared to 70 at June 30, 2005. The Banks had nine branch
locations at June 30, 2006, compared to six at June 30, 2005.
Jeanne Hubbard commented, “The current
marketplace with rising interest rates, flat yield curves and great
competition for loans and deposits by all players both old and newcomers, has
certainly had a negative impact on our earnings.
We are able to compete due to our dedicated employees, our commitment
to provide superior service and products, and our vigilant attention to
expense control and credit quality. We
plan to continue our steady growth and our effective risk management practices
to stay competitive and profitable.”
Abigail Adams National Bancorp, Inc.
declared a quarterly dividend of $0.125 per common share paid on June 30, 2006
to shareholders of record on June 15, 2006.
Abigail Adams National Bancorp is a
two-bank holding company, majority owned and operated by women. The Company is
focused on serving the financial needs of minorities, women, small to
mid-sized businesses, and not-for-profit organizations in the Washington, DC
and Richmond metropolitan areas. All information for the period ended June 30,
2006 has been derived from unaudited financial information.
Statements contained in this press
release that are not historical facts may constitute forward-looking
statements (within the meaning of Section 21E of the Securities and Exchange
Act of 1934, as amended) which involve significant risks and uncertainties.
The Company intends such forward-looking statements to be covered in the
Private Securities Litigation Reform Act of 1995, and is including this
statement for purposes of invoking these safe harbor provisions. The
Company’s ability to predict results or the actual effect of future plans or
strategies is inherently uncertain and involves a number of risks and
uncertainties, some of which have been set forth in the
Company’s most recent annual reports on Form 10-K, which disclosures
are incorporated by reference herein. The fact that there are various risks
and uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such statements.
SOURCE:
Abigail Adams National Bancorp
Selected Financial Data June 2006
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