EX-99 3 l02194aexv99.htm EX-99 EX-99
 

EXHIBIT 99

15985 East High Street
P. O. Box 35
Middlefield, Ohio 44062
Phone: 440/632-1666 FAX: 440/632-1700
www.middlefieldbank.com

 

PRESS RELEASE

     
Contact:   James R. Heslop, 2nd
    Executive Vice President/Chief Operating Officer
    (440) 632-1666 Ext. 3219
    jheslop@middlefieldbank.com

Middlefield Banc Corp. Reports Second Quarter Performance

MIDDLEFIELD, OHIO, July 17, 2003 tttt Middlefield Banc Corp. (Pink Sheets: MBCN) reported second quarter 2003 net income of $614,950, up 7.5% from the $571,923 earned during the same period last year. Year-to-date earnings were $1,267,696, representing an increase of 13.1% over the net income reported for the first six months of 2002. Diluted earnings per share for the second quarter and for the year-to-date are $0.53 and $1.09. These compare to the similar 2002 figures of $0.49 and $0.97, respectively.

Total assets increased 16.5% over the prior year, ending the second quarter of 2003 at $249.9 million as compared to $214.6 million at June 30, 2002. Net loans at June 30, 2003, were $179.9 million, up 10.9% from June 30, 2002. The investment portfolio also experienced growth between the two periods, being up 22.6% over the 2002 balance. Deposit totals were $206,115,632 at the end of the second quarter of 2003. This is an increase of 15.3% from the level at mid-year 2002.

Thomas G. Caldwell, President and CEO, in reviewing the results, noted, “We are pleased with our earnings and growth results for the first half of the year. The operating environment for financial institutions has been very difficult as interest rates remain at forty year lows. Additionally, we have added the extra expense of a new office.”

Caldwell continued, “It is our anticipation that the remainder of 2003 will find the economy continuing to improve, albeit at a sluggish rate. Our focus will be on minimizing risks while generating a proper level of income. Our commitment to our

 


 

shareholders remains to provide them with a fair return, while generating conservative growth.”

Return on average assets (ROA) were 1.01% and 1.07%, respectively for the quarter and year-to-date, as compared to 1.10% for both periods of 2002. Return on average equity was 11.78% for the quarter and 11.75% for the first six months of 2003. This compares to 2002 figures of 12.00% and 11.37%. The company’s net interest margin for the quarter and year-to-date was 3.94%, being lower for both periods than the prior year. The efficiency ratio for the first six months of 2003 was 59.11%, which was 20 basis points higher than the comparable 2002 result.

Non-interest income showed a 26.2% increase for the quarter and a 16.4% upward movement for the six-month period. In addition to an increase in service charges, the primary factor responsible for the increased non-interest income was the purchase of bank-owned life insurance at the end of the first quarter of 2003.

Non-interest expense for the quarter was $1.6 million, compared to $1.3 million for the same period last year and $2.9 million for the first half of 2003, incrementally higher than the $2.6 million reported for the year-ago period. The increase in expenses primarily reflects normal salary adjustments, an increase in health insurance costs, the addition of a new office, as well as the introduction of a new logo and marketing image for the company and its subsidiary bank.

“Although our non-interest expense totals were above the levels that have been our norm, we recognize that the new office and new image will have some near term impact,” stated Donald L. Stacy, Treasurer and Chief Financial Officer. “However, both of these initiatives have been very positively received. We are especially pleased with the reception of our new logo and marketing campaign, as they better portray our abilities to deliver financial services and the overall dynamic nature of our company.”

Credit quality remained a strong focus for the company. For the quarter and year-to-date, the company has experienced a net recovery of loans charged off. Non-performing loan and non-performing asset levels, at June 30, 2003, were 0.28% and 0.20%, respectively. The comparable figures at the same point in 2002 were 0.32% and 0.24%. President and Chief Executive Officer Thomas G. Caldwell stated, “Although our local economies have encountered some difficulties in the first half of this year, we have brought extra attention to the quality of our loan portfolio. We believe that our underwriting standards and our attention to our local communities and customers has permitted us to keep our exposures at reasonable levels.”

Middlefield Banc Corp. is a financial holding company for The Middlefield Banking Company. Full-service banking offices are located in Chardon, Garrettsville, Mantua, Middlefield, and Orwell, Ohio.

This announcement contains forward-looking statements that involve risk and uncertainties, including changes in general economic and financial market conditions and the Company’s ability to execute its business plans. Although management believes the expectations reflected in such statements are reasonable, actual results may differ materially.

 


 

                           
      Middlefield Banc Corp.
      Financial Highlights
      Quarterly Data
      (Dollars in thousands, except per share)
 
      June 2003   March 2003   June 2002
 
Earnings:
                       
 
Net interest income
  $ 2,175,419     $ 2,136,490     $ 1,986,880  
 
Provision for loan losses
    105,000       105,000       75,000  
 
Non-interest income
    358,102       276,037       283,715  
 
Security (losses) gains
    0       542       0  
 
Non-interest expense
    1,613,208       1,310,758       1,345,672  
 
Federal income taxes
    200,363       344,565       278,000  
 
 
   
     
     
 
 
Net income
  $ 614,950     $ 652,746     $ 571,923  
 
 
   
     
     
 
Per share:
                       
 
Basic earnings
    0.53       0.56       0.49  
 
Diluted earnings
    0.53       0.56       0.49  
 
Common dividends
    0.20       0.20       0.18  
 
Book value
    19.61       19.06       17.84  
Weighted average shares outstanding:
                       
 
Basic
    1,156,245       1,156,130       1,158,665  
 
Diluted
    1,159,275       1,158,478       1,159,196  
Period end balance sheet:
                       
 
Assets
  $ 249,885,875     $ 240,086,224     $ 214,615,550  
 
Securities
    40,507,882       42,838,505       33,048,781  
 
Total loans
    182,418,551       179,433,233       164,357,893  
 
Allowance for loan losses
    2,512,866       2,389,612       2,162,043  
 
Deposits
    206,115,632       194,702,460       178,795,328  
 
Total shareholders’ equity
    22,709,943       22,028,677       20,668,699  
 
Total capital ratio
    9.09 %     9.18 %     9.63 %
Average balance sheet:
                       
 
Assets
  $ 244,241,700     $ 231,844,604     $ 208,043,903  
 
Earning assets
    228,518,674       222,957,446       198,140,772  
 
Loans
    181,863,235       176,432,645       161,870,740  
 
Deposits
    200,987,836       189,227,570       174,476,490  
 
Shareholders’ equity
    20,882,567       21,379,486       19,063,491  
Key ratios (%):
                       
 
Return on average assets (ROA)
    1.01 %     1.13 %     1.10 %
 
Return on average shareholders’ equity (ROE)
    11.78 %     12.21 %     12.00 %
 
Net interest margin
    3.94 %     3.94 %     4.12 %
 
Net overhead
    2.20 %     1.86 %     2.14 %
 
Efficiency ratio
    63.67 %     54.32 %     59.27 %
Credit quality:
                       
 
Non-accrual loans
  $ 509,545     $ 551,000     $ 50,000  
 
Restructured loans
    0       0       0  
 
90 day past due and accruing
    0       132,000       475,000  
 
 
   
     
     
 
 
Non-performing loans
    509,545       683,000       525,000  
 
Other real estate owned
    0       0       0  
 
 
   
     
     
 
 
Non-performing assets
  $ 509,545     $ 683,000     $ 525,000  
 
 
   
     
     
 
 
Charge-offs
  $ 10,710     $ 17,609     $ 18,955  
 
Recoveries
    28,965       1,735       10,752  
 
 
   
     
     
 
 
Net charge-offs (recoveries)
  $ (18,255 )   $ 15,874     $ 8,203  
 
 
   
     
     
 
 
Allowance for loan losses as a percent of period-end loans (%)
    1.38 %     1.33 %     1.32 %
 
Net charge-offs (annualized) as a percent of average loans (%)
    -0.02 %     0.04 %     0.01 %
 
Non-performing loans as a percent of loans
    0.28 %     0.38 %     0.32 %
 
Non-performing assets as a percent of assets
    0.20 %     0.28 %     0.24 %

 


 

                           
      Middlefield Banc Corp.
      Financial Highlights
      Year-to-Date Data
      (Dollars in thousands, except per share)
 
      June 2003   March 2003   June 2002
 
Earnings:
                       
 
Net interest income
  $ 4,311,909     $ 2,136,490     $ 3,877,135  
 
Provision for loan losses
    210,000       105,000       150,000  
 
Non-interest income
    634,139       276,037       544,792  
 
Security (losses) gains
    542       542       0  
 
Non-interest expense
    2,923,966       1,310,758       2,605,094  
 
Federal income taxes
    544,928       344,565       546,000  
 
 
   
     
     
 
 
Net income
  $ 1,267,696     $ 652,746     $ 1,120,833  
 
 
   
     
     
 
Per share:
                       
 
Basic earnings
    1.10       0.56       0.97  
 
Diluted earnings
    1.09       0.56       0.97  
 
Common dividends
    0.40       0.20       0.35  
 
Book value
    19.61       19.06       17.84  
Weighted average shares outstanding:
                       
 
Basic
    1,156,188       1,156,130       1,158,427  
 
Diluted
    1,158,877       1,158,478       1,159,249  
Period end balance sheet:
                       
 
Assets
  $ 249,885,875     $ 240,086,224     $ 214,615,550  
 
Securities
    40,507,882       42,838,505       33,048,781  
 
Total loans
    182,418,551       179,433,233       164,357,893  
 
Allowance for loan losses
    2,512,866       2,389,612       2,162,043  
 
Deposits
    206,115,632       194,702,460       178,795,328  
 
Total shareholders’ equity
    22,709,943       22,028,677       20,668,699  
 
Total capital ratio
    9.09 %     9.18 %     9.63 %
Average balance sheet:
                       
 
Assets
  $ 237,073,107     $ 231,844,604     $ 203,625,183  
 
Earning assets
    225,224,016       222,957,446       194,858,603  
 
Loans
    178,782,048       176,432,645       157,931,380  
 
Deposits
    194,162,968       189,227,570       171,040,454  
 
Shareholders’ equity
    21,581,058       21,379,486       19,722,881  
Key ratios (%):
                       
 
Return on average assets (ROA)
    1.07 %     1.13 %     1.10 %
 
Return on average shareholders’ equity (ROE)
    11.75 %     12.21 %     11.37 %
 
Net interest margin
    3.94 %     3.94 %     4.08 %
 
Net overhead
    2.03 %     1.86 %     2.11 %
 
Efficiency ratio
    59.11 %     54.32 %     58.91 %
Credit quality:
                       
 
Non-accrual loans
  $ 509,545     $ 551,000     $ 50,000  
 
Restructured loans
    0       0       0  
 
90 day past due and accruing
    0       132,000       475,000  
 
 
   
     
     
 
 
Non-performing loans
    509,545       683,000       525,000  
 
Other real estate owned
    0       0       0  
 
 
   
     
     
 
 
Non-performing assets
  $ 509,545     $ 683,000     $ 525,000  
 
 
   
     
     
 
 
Charge-offs
  $ 28,319     $ 17,609     $ 91,103  
 
Recoveries
    30,700       1,735       40,894  
 
 
   
     
     
 
 
Net charge-offs (recoveries)
  $ (2,381 )   $ 15,874     $ 50,209  
 
 
   
     
     
 
 
Allowance for loan losses as a percent of period-end loans (%)
    1.38 %     1.33 %     1.32 %
 
Net charge-offs (annualized) as a percent of average loans (%)
    0.00 %     0.04 %     0.06 %
 
Non-performing loans as a percent of loans
    0.28 %     0.38 %     0.32 %
 
Non-performing assets as a percent of assets
    0.20 %     0.28 %     0.24 %

 


 

                             
        Middlefield Banc Corp.
        Consolidated Statements of Income
        Quarterly Data
        (Dollars in thousands, except per share data)
 
        June 2003   March 2003   June 2002
 
INTEREST INCOME
                       
 
Loans (including fees)
  $ 3,209,192     $ 3,129,988     $ 3,078,538  
 
Deposits in other institutions
    4,719       7,101       13,627  
 
Securities:
                       
   
Taxable
    275,853       308,608       296,483  
   
Exempt from federal income taxes
    113,502       119,590       101,085  
 
Federal funds sold and other temp. investments
    9,906       9,307       0  
 
Dividends on FHLB stock
    12,926       12,929       9,407  
 
 
   
     
     
 
   
Total interest income
    3,626,098       3,587,523       3,499,140  
INTEREST EXPENSE
                       
 
Deposits
    1,236,828       1,245,359       1,356,054  
 
Federal funds purchased and securities sold under agreement to repurchase
    1,049       2,290       2,274  
 
Federal Home Loan Bank advances
    212,802       203,384       153,932  
 
 
   
     
     
 
   
Total interest expense
    1,450,679       1,451,033       1,512,260  
 
 
   
     
     
 
   
Net interest income
    2,175,419       2,136,490       1,986,880  
 
Provision for loan losses
    105,000       105,000       75,000  
 
 
   
     
     
 
   
Net interest income after provision for loan losses
    2,070,419       2,031,490       1,911,880  
NON-INTEREST INCOME
                       
 
Service charges on deposit accounts
    251,910       238,651       244,138  
 
Security gains (losses)
    0       542       0  
 
Other operating income
    106,192       37,386       39,577  
 
 
   
     
     
 
   
Total non-interest income
    358,102       276,579       283,715  
NON-INTEREST EXPENSE
                       
 
Salaries and employee benefits
    810,919       646,471       659,858  
 
Net occupancy
    106,492       98,552       87,960  
 
Equipment
    57,586       80,026       81,167  
 
Data processing costs
    70,958       116,472       84,163  
 
Ohio state franchise tax
    75,000       75,050       67,500  
 
Other expense
    492,253       294,187       365,024  
 
 
   
     
     
 
   
Total non-interest expense
    1,613,208       1,310,758       1,345,672  
 
 
   
     
     
 
Income before federal income taxes
    815,313       997,311       849,923  
Income tax expense
    200,363       344,565       278,000  
 
 
   
     
     
 
Net income
  $ 614,950     $ 652,746     $ 571,923  
 
 
   
     
     
 
NET INCOME PER COMMON SHARE:
                       
   
Basic
  $ 0.53     $ 0.56     $ 0.49  
   
Diluted
  $ 0.53     $ 0.56     $ 0.49  

 


 

                             
        Middlefield Banc Corp.
        Consolidated Statements of Income
        Year-to-Date Data
        (Dollars in thousands, except per share data)
 
        June 2003   March 2003   June 2002
 
INTEREST INCOME
                       
 
Loans (including fees)
  $ 6,339,180     $ 3,129,988     $ 6,078,155  
 
Deposits in other institutions
    11,820       7,101       30,063  
 
Securities:
                       
   
Taxable
    584,461       308,608       581,569  
   
Exempt from federal income taxes
    233,092       119,590       210,616  
 
Federal funds sold and other temp. investments
    19,213       9,307       0  
 
Dividends on FHLB stock
    25,855       12,929       25,060  
 
 
   
     
     
 
   
Total interest income
    7,213,621       3,587,523       6,925,463  
INTEREST EXPENSE
                       
 
Deposits
    2,482,187       1,245,359       2,744,626  
 
Federal funds purchased and securities sold under agreement to repurchase
    3,339       2,290       3,546  
 
Federal Home Loan Bank advances
    416,186       203,384       300,156  
 
 
   
     
     
 
   
Total interest expense
    2,901,712       1,451,033       3,048,328  
 
 
   
     
     
 
   
Net interest income
    4,311,909       2,136,490       3,877,135  
 
Provision for loan losses
    210,000       105,000       150,000  
 
 
   
     
     
 
   
Net interest income after provision for loan losses
    4,101,909       2,031,490       3,727,135  
NON-INTEREST INCOME
                       
 
Service charges on deposit accounts
    490,561       238,651       467,048  
 
Security gains (losses)
    542       542       0  
 
Other operating income
    143,578       37,386       77,744  
 
 
   
     
     
 
   
Total non-interest income
    634,681       276,579       544,792  
NON-INTEREST EXPENSE
                       
 
Salaries and employee benefits
    1,457,390       646,471       1,251,923  
 
Net occupancy
    205,044       98,552       175,202  
 
Equipment
    137,612       80,026       164,375  
 
Data processing costs
    187,430       116,472       169,131  
 
Ohio state franchise tax
    150,050       75,050       135,050  
 
Other expense
    786,440       294,187       709,413  
 
 
   
     
     
 
   
Total non-interest expense
    2,923,966       1,310,758       2,605,094  
 
 
   
     
     
 
Income before federal income taxes
    1,812,624       997,311       1,666,833  
Income tax expense
    544,928       344,565       546,000  
 
 
   
     
     
 
Net income
  $ 1,267,696     $ 652,746     $ 1,120,833  
 
 
   
     
     
 
NET INCOME PER COMMON SHARE:
                       
   
Basic
  $ 1.10     $ 0.56     $ 0.97  
   
Diluted
  $ 1.09     $ 0.56     $ 0.97  

 


 

                             
        Middlefield Banc Corp.
        Consolidated Balance Sheets
        (Dollars in thousands)
 
        June 2003   March 2003   June 2002
 
ASSETS
                       
Cash and due from banks
  $ 6,102,703     $ 5,408,657     $ 6,268,312  
Federal funds sold and other temp. investments
    8,809,402       574,402       4,299,066  
Securities:
                       
 
Available for sale
    37,241,937       38,050,327       25,423,981  
 
Held to maturity
    3,265,945       4,788,178       7,624,800  
 
   
     
     
 
   
Total securities
    40,507,882       42,838,505       33,048,781  
Loans:
    182,418,551       179,433,233       164,357,893  
Less: reserve for loan losses
    2,512,866       2,389,612       2,162,043  
 
   
     
     
 
   
Net loans
    179,905,685       177,043,621       162,195,850  
Premises and equipment
    6,908,111       6,720,069       6,328,866  
Accrued interest receivable and other assets
    7,652,092       7,500,970       2,474,675  
 
   
     
     
 
   
Total assets
  $ 249,885,875     $ 240,086,224     $ 214,615,550  
 
   
     
     
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
                       
Deposits:
                       
 
Demand — non-interest bearing
  $ 29,595,597     $ 25,281,315     $ 26,039,948  
 
Demand — interest bearing
    21,096,468       23,300,237       16,968,316  
 
Savings
    54,867,549       51,377,777       46,806,973  
 
Time deposits
    100,556,018       94,743,131       88,980,091  
 
   
     
     
 
   
Total deposits
    206,115,632       194,702,460       178,795,328  
Federal funds purchased and securities sold under agreements to repurchase
    399,176       2,389,576       1,095,161  
Accrued expenses and other liabilities
    667,174       782,594       907,721  
Federal Home Loan Bank advances
    19,993,950       20,182,917       13,148,641  
 
   
     
     
 
   
Total liabilities
    227,175,932       218,057,547       193,946,851  
Shareholders’ equity:
                       
 
Common stock, no par value; 5,000,000 shares authorized
    8,006,055       7,944,216       7,735,893  
 
Retained earnings
    15,856,470       15,472,547       14,116,847  
 
Accumulated other comprehensive income
    592,327       356,823       292,399  
 
Treasury stock
    (1,744,909 )     (1,744,909 )     (1,476,440 )
 
   
     
     
 
   
Total shareholders’ equity
    22,709,943       22,028,677       20,668,699  
 
   
     
     
 
   
Total liabilities and shareholders’ equity
  $ 249,885,875     $ 240,086,224     $ 214,615,550  
 
   
     
     
 
Miscellaneous data:
                       
 
Common shares issued
    1,213,255       1,211,162       1,204,473  
 
Treasury shares
    55,309       55,309       45,722  
 
Bank owned life insurance (in other assets)
  $ 5,068,286     $ 5,000,000     $ 0