PRESS
RELEASE
February 28, 2002
Contact
Jim Arneson, Chief Financial Officer
(360) 459-1100
(360) 459-0137 (fax)
First
Community Financial Group Reports Record Earnings for 2001
Lacey,
Wash., February 28 -- First Community Financial Group, Inc.
("FCFG" or "the Company"), parent company
of First Community Bank of Washington, www.fcbonline.com,
today announced earnings for the year ended December 31, 2001
of $4,437,000. This is an increase of $76,000, or 2% over the
year ended December 31, 2000 and represents the highest-ever
annual earnings reported for FCFG. Earnings per diluted share
amounted to $1.99 for the year ended December 31, 2001, up
from $1.96 reported in 2000.
"We
are pleased with our earnings this year, particularly in light
of the investments we made in three new offices opened during
the year", remarked Ken F. Parsons, the Company's
Chairman, President and CEO. New branch offices typically take
a significant number of months before making a positive
contribution to earnings. Offices were opened in downtown
Tacoma, on the west side of Olympia and in Puyallup. "The
market has received us very positively in these new
areas," remarked Mr. Parsons.
The
Company's history of robust growth continued in 2001. Total
assets climbed 12% to $364,623,000 at December 31, 2001, while
total loans rose 14% to $294,897,000. Total deposits ended the
year at $313,730,000, an increase of 16% over the previous
year.
Despite
the Federal Reserve's dramatic cuts in key interest rates
during 2001, the net interest margin rose, from an average of
5.84% in 2000 to an average of 6.38% in 2001. In addition, the
total interest income earned from loans increased by $3.08
million, or 12%.
The
majority of the increased interest income, $2.33 million,
resulted from the growth of the company's loan portfolio
during the year. The balance of the increase, $755,000,
resulted from an increase in the average yield on the loans to
10.18% from the 9.89% earned in 2000.
"We
were able to achieve these excellent results despite rapidly
falling market rates due, in large part, to our small loan
initiative, which began in late 2000," Parsons explained.
"While these small denomination, short-term loans,
offered through our business partnership with Advance America,
comprise only 2.5% of the bank's loan portfolio, they carry
substantially higher yields than those in the Bank's
traditional portfolio because of their rapid turnover."
Interest
expense on deposits in 2001 increased a total of 7% or
$682,000 over the previous year due to growth in the level of
deposits. The effect on interest expense of deposit
growth was partially offset by a decline in the average rate
paid during the year, which fell from 4.31% in 2000 to 4.06%
during 2001.
Interest
expense on other borrowings in 2001 decreased by a total of
$702,000 from 2000. Of this decrease, approximately $413,000
is attributed to a decline in the amount of borrowing during
the year, and $289,000 is the result of a decline in the
average rate paid on those balances.
The
ratio of non-performing assets to total assets improved during
2001, from 1.92% at the beginning of the year to 1.85% at
December 31, 2001. Total non-performing assets amounted to
$6,758,000 million at year's end, an increase of 9% over prior
year. This compares favorably with the 14% overall growth in
the loan portfolio. "Given the weakness in the national
and local economies last year, we're pleased to show
improvement in credit quality," said Jon M. Jones,
Executive Vice President and Chief Lending Officer for First
Community Bank. In keeping pace with the growth of the loan
portfolio, and allowing for continued weakness in the economy,
the allowance for credit losses increased 17% during 2001,
ending the year at $4,088,000. Net charge-offs for the year
totaled $1,131,000, which was down 50% from net charge-offs in
the year 2000.
The
Company's capital position also continues to grow stronger,
increasing $4,422,000 to $38,795,000 in 2001 after payment of
dividends totaling $0.40 per share, or $874,000 during the
year. Despite the strong asset growth in 2001, the ratio of
total capital to risk weighted assets rose from 10.39% at the
end of 2000 to finish the year at 10.52%.
First
Community Financial Group, Inc., through its wholly owned
subsidiary, First Community Bank of Washington, has 19 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. The bank provides a broad range of
investment services through its subsidiary FCB Financial
Services, Inc. Further information about the bank may be found
on the Internet at www.fcbonline.com.
Note
Regarding Forward-Looking Information
This
news release may contain statements that are not historical in
nature, including the discussions of the adequacy of the
Company's capital resources and allowance for credit losses,
are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 ("PLSRA").
Forward-looking statements are subject to the risks and
uncertainties that may cause actual future results to differ
materially. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only
as of the date of this news release. FCFG does not
undertake any obligation to publicly release any revisions to
forward-looking statements contained in this release, with
respect to events or circumstances after the date of this
release, or to reflect the occurrence of unanticipated events.
Such risks and uncertainties with respect to the Company
include those related to the economic environment,
particularly in the region in which the Company operates,
competitive products and pricing, fiscal and monetary policies
of the federal government, changes in government regulations
affecting financial institutions, including regulatory fees
and capital requirements, changes in prevailing interest
rates, acquisitions and the integration of acquired
businesses, credit risk management and asset/liability
management, the financial and securities markets, and the
availability of and costs associated with sources of
liquidity.
Condensed
Statements of Condition
Condensed
Statements of Operations
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