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):
July 26, 2007
TriCo Bancshares
(Exact name of registrant as specified in its charter)
California 0-10661 94-2792841
------------------------ --------------- --------------------
(State or other (Commission File No.) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or organization)
63 Constitution Drive, Chico, California 95973
--------------------------------------------------------------------------------
(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
---------------------------------------------------------
On July 26, 2007 TriCo Bancshares announced its quarterly earnings for the
period ended June 30, 2007. 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
-------------------
(c) Exhibits
99.1 Press release dated July 26, 2007
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: July 30, 2007 By: /s/ Thomas J. Reddish
--------------------------------------
Thomas J. Reddish, Executive Vice
President and Chief Financial Officer
(Principal Financial and Accounting
Officer)
INDEX TO EXHIBITS
Exhibit No. Description
----------- --------------------------------------------
99.1 Press release dated July 26, 2007
PRESS RELEASE Contact: Thomas J. Reddish
For Immediate Release EVP & CFO (530) 898-0300
TRICO BANCSHARES ANNOUNCES QUARTERLY EARNINGS
CHICO, Calif. - (July 26, 2007) - TriCo Bancshares (NASDAQ: TCBK), parent
company of Tri Counties Bank, today announced quarterly earnings of $6,755,000
for the quarter ended June 30, 2007. This represents a 3.0% increase when
compared with earnings of $6,557,000 for the quarter ended June 30, 2006.
Diluted earnings per share for the quarter ended June 30, 2007 increased 2.5% to
$0.41 from $0.40 for the quarter ended June 30, 2006. Total assets of the
Company increased $15,871,000 (0.9%) to $1,887,027,000 at June 30, 2007 from
$1,871,156,000 at June 30, 2006. Total loans of the Company increased
$51,620,000 (3.6%) to $1,507,628,000 at June 30, 2007 from $1,456,008,000 at
June 30, 2006. Total deposits of the Company decreased $3,561,000 (0.2%) to
$1,510,879,000 at June 30, 2007 from $1,514,440,000 at June 30, 2006. Diluted
earnings per share for the six months ended June 30, 2007 and 2006 were $0.80
and $0.80, respectively, on earnings of $13,199,000 and $13,092,000,
respectively.
The improvement in results from the year-ago quarter was due to a $950,000
(4.4%) increase in fully tax-equivalent (FTE) net interest income to
$22,308,000, a $54,000 (9.7%) decrease in the provision for loan losses to
$500,000, and a $498,000 (7.6%) increase in noninterest income to $7,029,000.
These contributing factors were partially offset by a $1,167,000 (7.2%) increase
in noninterest expense to $17,443,000 for the quarter ended June 30, 2007.
The increase in net interest income (FTE) was due to a $21,915,000 (1.3%)
increase in average balances of interest-earning assets to $1,698,620,000 and a
0.15% increase in net interest margin (FTE) to 5.25%. This increase in net
interest margin was mainly due to an 0.16% increase in the impact of net
noninterest-bearing funds from the year-ago three month period that was
partially offset by a 0.01% decrease in net interest spread as the average yield
on interest-earning assets increased 0.51% while the average rate paid on
interest-bearing liabilities increased 0.52% from the year-ago three month
period.
The Company provided $500,000 for loan losses in the second quarter of 2007
versus $554,000 in the second quarter of 2006. During the second quarter of
2007, the Company recorded $396,000 of net loan charge offs versus $305,000 of
net loan charge-offs in the year earlier quarter. The $396,000 of net loan
charge-offs during the second quarter of 2007 represented 0.11% of average loan
balances on an annualized basis. At June 30, 2007, the combination of the
Company's allowance for loan losses ($16,999,000) and reserve for unfunded
commitments ($2,040,000) represented 143% of non-performing loans net of
government agency guarantees ($13,360,000). The $13,360,000 of non-performing
loans net of government guarantees at June 30, 2007 represents an increase of
$7,369,000 from the $5,991,000 balance of such loans at March 31, 2007.
$7,175,000 of the $7,369,000 increase was related to two residential real estate
construction loans to a single borrower that matured, were well secured and in
the process of refinance at June 30, 2007 with an entity other than the Company.
The loans were paid off in-full on July 26, 2007.
The increase in noninterest income from the year-ago quarter was mainly due to a
$152,000 (4.1%) increase in service charges on deposit accounts to $3,858,000, a
$150,000 (16.7%) increase in ATM fees and interchange to $1,046,000, and a
$115,000 improvement in change in value of mortgage servicing rights to $73,000.
The increase in service charges on deposit accounts was primarily due to growth
in customer count. The increase in ATM fees and interchange was due to growth in
customer count and expansion of ATM network as part of new branch openings. The
improvement in change in value of mortgage servicing rights is primarily due to
a slowdown in refinance activity which extends the estimated life of existing
mortgages and enhances the value of the related mortgage servicing rights.
Noninterest expense for the second quarter of 2007 increased $1,167,000 (7.2%)
compared to the second quarter of 2006. Salaries and benefits expense increased
$1,001,000 (11.6%) to $9,619,000, mainly due to annual salary increases, and a
1.5% increase in average full time equivalent staff made up primarily of new
employees at the Company's recently opened branches. Other categories of
noninterest expense such as equipment, occupancy and ATM network charges also
increased, in part, due to these newly opened branches. Intangible amortization
decreased $228,000 (65%) to $122,000 during the second quarter of 2007 as the
core deposit intangible related to the purchase of several branches in 1997
became fully amortized in the fourth quarter of 2006.
As of June 30, 2007, the Company had repurchased 394,371 shares of its common
stock under its stock repurchase plan announced on July 31, 2003 and amended on
April 9, 2004, which left 105,629 shares available for repurchase under the
plan.
Richard Smith, President and Chief Executive Officer commented, "We are pleased
with our results for the second quarter of 2007 as TriCo realized a small
improvement over the second quarter of 2006 results and a nicer improvement over
the first quarter of 2007 results. We continue to believe that the slowdown in
real estate value appreciation and real estate activity in general is affecting
both wholesale and retail banking growth rates. However, we are optimistic about
the prospects of our Company as we continue to add customers and expand our
franchise in a profitable manner despite the challenging interest rate
environment and competitive pressures."
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 31-year history in the banking industry. Tri Counties
Bank operates 32 traditional branch locations and 23 in-store branch locations
in 22 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 62 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 share data)
Three months end
------------------------------------------------------------------------------
June 30, March 31, December 31, September 30, June 30,
2007 2007 2006 2006 2006
------------------------------------------------------------------------------
Statement of Income Data
Interest income $31,986 $30,661 $31,545 $31,421 $29,379
Interest expense 9,895 9,216 9,821 9,576 8,275
Net interest income 22,091 21,445 21,724 21,845 21,104
Provision for loan losses 500 482 - 235 554
Noninterest income:
Service charges and fees 5,375 5,061 4,940 5,056 4,956
Other income 1,654 1,539 1,687 1,593 1,575
Total noninterest income 7,029 6,600 6,627 6,649 6,531
Noninterest expense:
Salaries and benefits 9,619 9,742 9,405 9,276 8,618
Intangible amortization 122 123 350 350 350
Provision for losses -
unfunded commitments 74 117 - - 36
Other expense 7,628 6,978 7,247 7,400 7,272
Total noninterest expense 17,443 16,960 17,002 17,026 16,276
Income before taxes 11,177 10,603 11,349 11,233 10,805
Net income $6,755 $6,444 $6,918 $6,820 $6,557
Share Data
Basic earnings per share $0.42 $0.41 $0.44 $0.43 $0.42
Diluted earnings per share 0.41 0.39 0.42 0.42 0.40
Book value per common share 11.22 10.96 10.69 10.41 9.96
Tangible book value per common share $10.16 $9.89 $9.60 $9.22 $8.75
Shares outstanding 15,917,291 15,910,291 15,857,207 15,857,107 15,855,107
Weighted average shares 15,916,313 15,878,929 15,857,166 15,855,933 15,798,565
Weighted average diluted shares 16,463,389 16,415,845 16,396,320 16,365,858 16,388,855
Credit Quality
Non-performing loans, net of
government agency guarantees $13,360 $5,991 $4,512 $4,523 $3,913
Other real estate owned 187 187 - - -
Loans charged-off 751 739 498 368 564
Loans recovered $355 $238 $419 $233 $259
Allowance for losses to total loans(1) 1.26% 1.26% 1.24% 1.25% 1.29%
Allowance for losses to NPLs(1) 143% 315% 416% 417% 479%
Allowance for losses to NPAs(1) 141% 305% 416% 417% 479%
Selected Financial Ratios
Return on average total assets 1.44% 1.38% 1.46% 1.45% 1.42%
Return on average equity 15.11% 14.79% 16.23% 16.64% 16.68%
Average yield on loans 7.93% 7.63% 7.81% 7.82% 7.44%
Average yield on interest-earning assets 7.58% 7.30% 7.43% 7.44% 7.07%
Average rate on interest-bearing liabilities 3.02% 2.85% 2.97% 2.86% 2.50%
Net interest margin (fully tax-equivalent) 5.25% 5.12% 5.13% 5.19% 5.10%
Total risk based capital ratio 11.8% 11.8% 11.3% 11.1% 11.1%
Tier 1 Capital ratio 10.8% 10.8% 10.3% 10.1% 10.1%
(1) Allowance for losses includes allowance for loan losses and reserve for unfunded commitments.
TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA
(Unaudited. Dollars in thousands)
Three months ended
-------------------------------------------------------------------------------
June 30, March 31, December 31, September 30, June 30,
2007 2007 2006 2006 2006
-------------------------------------------------------------------------------
Balance Sheet Data
Cash and due from banks $93,636 $75,263 $102,220 $78,281 $84,663
Federal funds sold 1,715 - 794 1,387 526
Securities, available-for-sale 175,891 188,478 198,361 209,886 221,828
Federal Home Loan Bank Stock 8,543 8,442 8,320 8,206 8,103
Loans
Commercial loans 159,822 142,083 153,105 153,705 146,952
Consumer loans 526,575 516,550 525,513 527,185 517,588
Real estate mortgage loans 687,744 687,088 679,661 661,962 642,422
Real estate construction loans 133,487 149,893 151,600 164,307 149,046
Total loans, gross 1,507,628 1,495,614 1,509,879 1,507,159 1,456,008
Allowance for loan losses (16,999) (16,895) (16,914) (16,993) (16,893)
Premises and equipment 20,891 20,924 21,830 21,556 21,597
Cash value of life insurance 44,346 43,941 43,536 42,991 42,571
Goodwill 15,519 15,519 15,519 15,519 15,519
Intangible assets 1,421 1,543 1,666 3,361 3,711
Other assets 34,436 33,492 34,755 32,651 33,523
Total assets 1,887,027 1,866,321 1,919,966 1,904,004 1,871,156
Deposits
Noninterest-bearing demand deposits 366,321 364,401 420,025 357,754 354,576
Interest-bearing demand deposits 226,591 235,497 230,671 229,143 235,100
Savings deposits 387,422 381,069 374,605 369,933 388,847
Time certificates 530,545 555,882 573,848 568,344 535,917
Total deposits 1,510,879 1,536,849 1,599,149 1,525,174 1,514,440
Federal funds purchased 80,500 38,000 38,000 106,500 96,700
Reserve for unfunded commitments 2,040 1,966 1,849 1,849 1,849
Other liabilities 28,878 32,524 30,383 28,254 24,964
Other borrowings 44,892 41,347 39,911 35,848 33,971
Junior subordinated debt 41,238 41,238 41,238 41,238 41,238
Total liabilities 1,708,427 1,691,924 1,750,530 1,738,863 1,713,162
Total shareholders' equity 178,600 174,397 169,436 165,141 157,994
Accumulated other
comprehensive loss (4,779) (3,988) (4,521) (3,607) (5,629)
Average loans 1,506,913 1,490,055 1,498,040 1,477,551 1,427,735
Average interest-earning assets 1,698,620 1,692,574 1,711,743 1,701,166 1,676,705
Average total assets 1,871,260 1,865,448 1,890,765 1,880,029 1,850,487
Average deposits 1,500,733 1,534,473 1,550,979 1,501,630 1,497,571
Average total equity $178,836 $174,262 $170,518 $163,919 $157,232