PRESS RELEASE
February 2, 2004
Contact
Cathy Reines, Chief Financial Officer
(360) 459 -1100
(360) 459 - 0137 (fax)
Venture Financial Group Reports Quarterly Results and
Annual Record Earnings
FOURTH QUARTER HIGHLIGHTS
Quarterly income increases 25% over prior year
Diluted earnings per share increases 36% over prior year
Credit quality significantly improved
ANNUAL HIGHLIGHTS
Annual income increased 46% over prior year
Non-performing assets down $8.6 million or 67% over prior year
Non-interest income increased 60%, primarily due to a 34%
increase in mortgage origination fee
Harbor Bank acquisition in 2002 becomes accretive to 2003
earnings
Net interest income increased 8%, primarily due to a 22%
reduction in interest expense
Olympia, Wash. - February 2, 2004 -
Venture Financial Group, Inc. (“Venture” or “the Company”), parent company of Venture Bank
(www.venture-bank.com) today announced
record fourth quarter net income of $2.0 million, an
increase of 25% compared to $1.5 million for the fourth
quarter 2002. Diluted earnings per share were $.45 for the
quarter ended December 31, 2003, up 36% from $.33 for the
same quarter in 2002. Net income for the twelve months
ended December 31, 2003 was $9.1 million, an increase of
$2.9 million or 46% compared to $6.2 million for the same
period in 2002. On a diluted earnings per share basis,
net income was $1.98 per share for the twelve months ended
December 31, 2003 compared with $1.39 for the same period in
2002, an increase of 42%.
Ken F. Parsons Sr., CEO and Chairman,
stated, “We are pleased with both the Company’s quarterly
and annual results. This performance clearly reflects the
efforts of the Company’s Board of Directors, Management and
all of our employees.”
For the quarter ended December 31, 2003, assets totaled
$514 million, an increase of 8.3% over the $474 million at
December 31, 2002. Increases in 2003 included securities
available for sale which grew 152% over prior year to $84.9
million and cash value of life insurance which increased to
$13.1 million or 48.0% over prior year. Decreases in assets
included foreclosed real estate which declined $2.9 million
or 59% and cash and due from banks which declined $11.9
million or 38.5%. Total borrowings increased $35.8 million
or 88% over the prior year. These borrowings were used
primarily to fund the purchase of securities. Total loans
and deposits fluctuated only slightly for the quarter ended
December 31, 2003 as compared to the same period in 2002.
Operating Results
Quarter Ended December 31, 2003
Net Interest Income
Net interest income for the fourth quarter of 2003 decreased
14.8% to $5.9 million, from $7.0 million for the quarter
ended December 31, 2002. This decrease was a result of the
reclassification of Alabama small loan income from loan fees
to other non-interest income and a decline in the average
loan yield associated with the ongoing low short-term
interest rate.
Net interest income for the twelve months ended December 31,
2003 increased 7.7% to $25.2 million from $23.4 million for
the same period last year.
Non-interest Income
Non-interest income increased $.2 million or 9.6% in the
fourth quarter of 2003 compared to the fourth quarter 2002,
and $4.7 million or 59.7% for the 12 month period ended
December 31, 2003 compared with the same period in 2002. The
increase for the fourth quarter is primarily attributed to
the reclassification of the Alabama small loan income
discussed above. The increase for the 12 month period over
the same period in 2002 is primarily the result of the $2.1
million “Gain on Sale of Foreclosed Real Estate” recorded in
July of 2003.
Non-interest Expense
Total non-interest expense decreased $1.6 million or 24.5%
for the fourth quarter of 2003 and increased $2.1 million or
10.6% for the twelve months ended December 31, 2003 compared
with the same periods in 2002. The quarterly decrease can be
primarily attributed to one-time costs incurred by the Bank
relating to the Harbor Bank acquisition and the costs
associated with the branding efforts expensed in the last
quarter of 2002. The year-to-date increase over prior year
is primarily attributed to a full year of Harbor Bank
expenses incurred in 2003 versus three months in 2002. In
addition, the Company incurred additional marketing and
rollout costs related to the branding efforts that occurred
in 2003.
Nonperforming Assets
Nonperforming assets (which includes nonperforming loans and
other nonperforming assets) as a percentage of total assets
was .82%, 2.81% and 2.69% as of December 31, 2003, June 30,
2003 and December 31, 2002 respectively. The decrease from
June 30, 2003 is primarily attributed to the sale of two
significant properties in the OREO portfolio.
“I am thrilled with the operating results of the Company,”
said Jon M. Jones, President of Venture Bank. “The Harbor
Bank acquisition that closed in 2002 has proven accretive to
our earnings and the quality of the Bank’s loan portfolio
has improved tremendously during the year. We are very proud
of both accomplishments,” said Mr. Jones.
Venture Financial Group, through its wholly owned
subsidiary, Venture Bank, has 20 offices in four western
Washington counties and offers a full spectrum of financial
services including commercial, construction, residential and
consumer lending, deposit products and other banking
services. Further information about the Bank may be found on
the Internet at
www.venture-bank.com.
Condensed
Statements of Condition
Condensed
Statements of Operations
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