UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
October 21, 2004
TriCo Bancshares
(Exact name of registrant as specified in its charter)
California 0-10661 94-2792841
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(State or other (Commission File No.) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or organization)
63 Constitution Drive, Chico, California 95973
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(530) 898-0300
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 2.02: Results of Operations and Financial Condition
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On October 21, 2004 TriCo Bancshares announced their quarterly earnings for the
period ended September 30, 2004. A copy of the press release is attached as
Exhibit 99.1 to this Form 8-K and is incorporated herein by reference.
Item 9.01: Exhibits
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99.1 Press release dated October 21, 2004
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
TRICO BANCSHARES
Date: October 21, 2004 By: /s/ Thomas J. Reddish
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Thomas J. Reddish, Executive Vice
President and Chief Financial Officer
(Principal Financial and Accounting
Officer)
INDEX TO EXHIBITS
Exhibit No. Description
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99.1 Press release dated October 21, 2004
PRESS RELEASE Contact: Thomas J. Reddish
For Immediate Release Executive Vice President & CFO
(530) 898-0300
TRICO BANCSHARES ANNOUNCES RECORD HIGH EARNINGS IN
THIRD QUARTER 2004
CHICO, Calif. - (October 21, 2004) - TriCo Bancshares (NASDAQ: TCBK), parent
company (the "Company") of Tri Counties Bank (the "Bank"), today announced
record quarterly earnings of $5,203,000 for the quarter ended September 30,
2004. This represents a 19.9% increase when compared with earnings of $4,338,000
for the quarter ended September 30, 2003. Diluted earnings per share for the
quarter ended September 30, 2004 increased 18.5% to $0.32 from $0.27 for the
quarter ended September 30, 2003. Total assets of the Company increased $132
million (9.2%) to $1.573 billion at September 30, 2004 versus $1.441 billion at
September 30, 2003. Total loans of the Company increased $196 million (21.1%) to
$1.126 billion at September 30, 2004 versus $930 million at September 30, 2003.
Total deposits of the Company increased $96 million (8.0%) to $1.292 billion at
September 30, 2004 versus $1.196 billion at September 30, 2003. Diluted earnings
per share for the nine months ended September 30, 2004 and 2003 were $0.91 and
$0.78, respectively, on earnings of $14,827,000 and $12,205,000, respectively.
"Tri Counties Bank continues to grow at an outstanding level and we are prepared
to handle our anticipated rapid rate of expansion next year," said Richard
Smith, President and Chief Executive Officer. "We are opening six new branches
in the Sacramento area in the next year. We are excited about the opportunities
this creates to add customers that enhance our source of low cost deposits,
service charges and fee revenue. Additionally, loan demand continues to be
strong and the credit quality of our loan portfolio remains high."
The increase in earnings for the quarter ended September 30, 2004 over the
year-ago quarter was due to a $2,657,000 (16.8%) increase in net interest income
to $18,457,000, and a $1,155,000 (22.2%) increase in noninterest income to
$6,361,000. The increase in net interest income was due to a $222 million
(25.3%) increase in average loan balances to $1.098 billion, and a 0.11%
increase in fully tax-equivalent net interest margin to 5.35% during the quarter
ended September 30, 2004 compared to the year-ago quarter.
The following table shows the components of noninterest income for the
three-month periods ended September 30, 2004 and 2003, and the changes therein:
Three Months Ended September 30,
2004 2003 Change
Service charges on deposit accounts $ 3,399 $ 3,208 $ 191
ATM fees and surcharges 693 566 127
Other service fees 342 (56) 398
Mortgage servicing valuation provision - (600) 600
Gain on sale of loans 258 936 (678)
Commissions on sale of
nondeposit investment products 578 396 182
Gain on sale of investments - 97 (97)
Gain on sale of fixed assets 8 - 8
Gain on sale of other real estate 384 - 384
Increase in cash value of life insurance 352 446 (94)
Other noninterest income 347 213 134
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Total noninterest income $ 6,361 $ 5,206 $ 1,155
Service charges on deposit accounts, ATM fees and surcharges, other service fees
and mortgage servicing valuation provision increased $1,316,000 (42.2%) to
$4,434,000 during the quarter ended September 30, 2004 compared to $3,118,000 in
the year-ago quarter. The increases in these categories are primarily due to an
increase in number of customers as a result of the Bank's continued de-novo
expansion and penetration of existing markets, and a decrease in mortgage
refinance activity which resulted in higher net service fees, and value of
servicing, related to mortgages the Company services for others. During the
third quarter of 2003, when refinance activity was high, the Company recorded a
$600,000 valuation allowance for its mortgage servicing portfolio. During the
first quarter of 2004, as refinance activity slowed, the Company recovered
$30,000 of the $600,000 valuation allowance. During the second quarter of 2004,
as refinance activity continued to slow, the Company recovered the remaining
$570,000 of this valuation allowance. As of September 30, 2004, the Company
serviced $371 million of residential mortgage loans for others, $363 million of
which is subject to potential valuation allowance. As of September 30, 2004,
this servicing portfolio has an estimated market value of $3.5 million, and is
recorded in the Company's consolidated financial statements at $3.5 million. The
decrease in gain on sale of loans is also due to the slowdown in mortgage
refinance activity that peaked in the middle of 2003.
The increases in net interest income and noninterest income were partially
offset by a $1,150,000 (767%) increase in provision for loan losses to
$1,300,000, and a $1,040,000 (7.4%) increase in noninterest expense to
$15,089,000 in the quarter ended September 30, 2004 versus the year-ago quarter.
The increase in provision for loan losses is mainly due to loan growth of $48
million during the quarter ended September 30, 2004 as loan quality remains high
and loan charge-offs were moderate. During the quarter ended September 30, 2004,
net loan charge-offs were $613,000 or 0.22% of average outstanding loans on an
annualized basis. As of September 30, 2004, nonperforming loans net of
government guarantees, and the allowance for loan losses were 0.44% and 1.44%,
respectively, of outstanding loans. The ratio of the allowance for loan losses
to nonperforming loans was 329% at September 30, 2004. The increase in
noninterest expense was mainly due to salary and benefit expense related to the
addition of de-novo branches in Roseville (November 2003), Folsom (December
2003), and Turlock (April 2004), and regular salary increases.
As previously announced on March 11, 2004, the Board of Directors of TriCo
Bancshares approved a two-for-one stock split of its common stock at its meeting
held on March 11, 2004. The stock split was effected in the form of a stock
dividend and provided each stockholder of record at the close of business on
April 9, 2004 one additional share for every share of TriCo common stock held on
that date. Shares resulting from the split were distributed on April 30, 2004.
As of September 30, 2004, the Company had 15,698,000 common shares outstanding.
All per share amounts for prior periods have been restated to reflect the stock
split.
As of October 21, 2004, the Company had purchased 222,600 shares of its common
stock under its stock repurchase plan announced on July 31, 2003 and amended on
April 9, 2004, which leaves 277,400 shares available for repurchase under the
plan.
In addition to the historical information contained herein, this press release
contains certain forward-looking statements. The reader of this press release
should understand that all such forward-looking statements are subject to
various uncertainties and risks that could affect their outcome. The Company's
actual results could differ materially from those suggested by such
forward-looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, variances in the actual versus
projected growth in assets, return on assets, loan losses, expenses, rates
charged on loans and earned on securities investments, rates paid on deposits,
competition effects, fee and other noninterest income earned as well as other
factors. This entire press release should be read to put such forward-looking
statements in context and to gain a more complete understanding of the
uncertainties and risks involved in the Company's business.
TriCo Bancshares and Tri Counties Bank are headquartered in Chico, California.
Tri Counties Bank has a 28-year history in the banking industry. Tri Counties
Bank operates 33 traditional branch locations and 12 in-store branch locations
in 21 California counties. Tri Counties Bank offers financial services and
provides a diversified line of products and services to consumers and
businesses, which include demand, savings and time deposits, consumer finance,
online banking, mortgage lending, and commercial banking throughout its market
area. It operates a network of 57 ATMs and a 24-hour, seven days a week
telephone customer service center. Brokerage services are provided at the Bank's
offices by the Bank's association with Raymond James Financial, Inc. For further
information please visit the Tri Counties Bank web-site at
http://www.tricountiesbank.com.
TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA
(Unaudited. Dollars in thousands, except per share data)
Three months ended
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September 30, June 30, March 31, December 31, September 30,
2004 2004 2004 2003 2003
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Statement of Income Data
Interest income $ 21,951 $ 20,628 $ 19,912 $ 20,354 $ 19,105
Interest expense 3,494 3,087 3,014 3,224 3,305
Net interest income 18,457 17,541 16,898 17,130 15,800
Provision for loan losses 1,300 1,300 650 800 150
Noninterest income:
Service charges and fees 4,434 4,910 4,083 3,939 3,118
Other income 1,927 2,032 1,672 1,814 2,088
Total noninterest income 6,361 6,942 5,755 5,753 5,206
Noninterest expense:
Salaries and benefits 8,319 8,440 8,167 7,741 7,460
Intangible amortization 343 343 331 330 325
Other expense 6,427 6,629 5,848 6,388 6,264
Total noninterest expense 15,089 15,412 14,346 14,459 14,049
Income before taxes 8,429 7,771 7,657 7,624 6,807
Net income $ 5,203 $ 4,847 $ 4,777 $ 4,683 $ 4,338
Share Data(1)
Basic earnings per share $ 0.33 $ 0.31 $ 0.31 $ 0.30 $ 0.28
Diluted earnings per share 0.32 0.30 0.29 0.29 0.27
Book value per common share 8.64 8.20 8.28 8.17 7.95
Tangible book value per common share $ 7.33 $ 6.87 $ 6.92 $ 6.79 $ 6.55
Shares outstanding 15,697,817 15,639,897 15,635,522 15,668,248 15,692,002
Weighted average shares 15,672,300 15,639,556 15,616,540 15,693,494 15,700,748
Weighted average diluted shares 16,247,422 16,215,160 16,212,845 16,296,892 16,189,928
Credit Quality
Non-performing loans, net of
government agency guarantees $ 4,931 $ 3,886 $ 5,265 $ 4,394 $ 6,072
Other real estate owned - 628 924 932 1,545
Loans charged-off 687 177 188 859 551
Loans recovered $ 74 $ 110 $ 62 $ 372 $ 406
Allowance for loan losses to total loans 1.44% 1.44% 1.44% 1.40% 1.45%
Allowance for loan losses to NPLs 329% 400% 272% 313% 222%
Allowance for loan losses to NPAs 329% 344% 231% 259% 177%
Selected Financial Ratios
Return on average total assets 1.34% 1.29% 1.33% 1.29% 1.25%
Return on average equity 15.57% 14.97% 14.80% 14.71% 14.09%
Average yield on loans 6.87% 6.82% 6.90% 7.17% 7.41%
Average yield on earning assets 6.35% 6.18% 6.30% 6.41% 6.32%
Average rate on earning liabilities 1.25% 1.14% 1.18% 1.26% 1.36%
Net interest margin (fully tax-equivalent) 5.35% 5.27% 5.35% 5.41% 5.24%
Total risk based capital ratio 12.4% 12.4% 11.5% 11.6% 11.7%
Tier 1 Capital ratio 11.0% 10.9% 10.3% 10.4% 10.6%
(1) Share and per share data for all periods have been adjusted to reflect the 2-for-1 stock split announced
March 11, 2004 payable on April 30, 2004 to shareholders of record on April 9, 2004.
TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA
(Unaudited. Dollars in thousands, except per share data)
Three months ended
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September 30, June 30, March 31, December 31, September 30,
2004 2004 2004 2003 2003
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Balance Sheet Data
Cash and due from banks $ 64,318 $ 65,512 $ 55,568 $ 80,603 $ 66,747
Fed funds sold - - - 326 1,900
Securities, available-for-sale 292,966 309,163 312,657 316,436 350,941
Loans
Commercial loans 151,998 146,262 131,759 142,252 152,477
Consumer loans 384,560 357,901 334,221 319,029 297,186
Real estate mortgage loans 527,808 518,696 465,429 458,369 420,312
Real estate construction loans 62,057 55,605 62,656 61,591 60,066
Total loans, gross 1,126,423 1,078,464 994,065 981,241 930,041
Allowance for loan losses (16,216) (15,529) (14,297) (13,773) (13,460)
Premises and equipment 20,118 18,996 19,288 19,521 19,787
Cash value of life insurance 40,196 39,844 39,412 38,980 38,644
Intangible assets 20,589 20,931 21,274 21,604 21,992
Other assets 25,103 27,792 22,476 23,817 24,611
Total assets 1,573,497 1,545,173 1,450,443 1,468,755 1,441,203
Deposits
Noninterest bearing demand deposits 298,319 282,292 260,299 298,462 267,148
Interest bearing demand deposits 224,619 224,552 222,986 220,875 211,219
Savings deposits 474,345 476,798 488,915 441,461 426,340
Time certificates 294,858 283,710 267,739 276,025 291,145
Total deposits 1,292,141 1,267,352 1,239,939 1,236,823 1,195,852
Fed funds purchased & repurchase agreements 57,300 66,000 16,300 39,500 55,700
Other liabilities 19,971 19,397 21,194 20,966 21,312
Other borrowings 27,159 22,866 22,877 22,887 22,894
Junior subordinated debt 41,238 41,238 20,619 20,619 20,619
Total liabilities 1,437,809 1,416,853 1,320,929 1,340,795 1,316,377
Total shareholders' equity 135,688 128,320 129,514 127,960 124,826
Accumulated other
comprehensive income (loss) 1,155 (1,984) 2,426 1,814 1,223
Average loans 1,098,442 1,029,425 970,793 951,669 876,068
Average interest earning assets 1,399,342 1,351,774 1,281,032 1,285,905 1,226,453
Average total assets 1,552,743 1,505,261 1,440,953 1,447,137 1,384,672
Average deposits 1,275,599 1,252,472 1,231,704 1,216,223 1,185,059
Average total equity $ 133,628 $ 129,481 $ 129,133 $ 127,374 $ 123,168