SOURCE: RMG Capital Corporation
RMG Capital Corporation Reports Third Quarter Earnings
FULLERTON, CA--(Marketwire - November 21, 2008) - RMG Capital Corporation (
RMG Capital Corporation announced year-to-date net income of $3.02 million or $.98 per share compared to $3.56 million or $1.17 per share for the same period 2007. This represents a decrease of $540 thousand year to date, when compared with the 2007 nine month results. The 2008 results include a one-time deferred compensation charge of $1.1 million. At September 30, 2008, RMG Capital had total assets of $769.2 million as compared with $708.3 million at December 31, 2007 and $695.4 million at September 30, 2007. "This is one of the most challenging economic and banking environments we have ever faced," commented Tom Meyer, Bank President. "In light of this environment, I am pleased that the September 2008 year-to-date RMG net income, net of the one-time deferred compensation charge, is greater than the comparable net income of September 2007 year-to-date results. This is attributable to a diversified loan portfolio that is not overly concentrated in the most troubled credit sectors and our ability to keep our funding costs low."
Net interest income after provisions for loan losses totaled $19.3 million year-to-date, an increase of 11.7% or $2.03 million from a year ago. Net interest spread for the Bank increased to an average of 4.06% through September 30, 2008, compared to an average of 3.40% through September 30, 2007. The cost of funds on deposits and borrowings decreased from 3.41% on December 31, 2007 to 2.20% as of September 30, 2008. As of September 30, 2008 the efficiency ratio for the Bank was 67.5% compared to 67.8% at December 31, 2007.
Non-performing loans as of September 30, 2008 were 3.03% of total loans as compared to .74% as of June 30, 2007. The provision for loan losses was increased during the third quarter by $1.29 million resulting in overall reserves of 1.04% of total loans as of September 30, 2008. "Our loan portfolio is well diversified," said Meyer, "but we are taking a more aggressive approach to setting reserves due to the current state of the southern California economy and deteriorating conditions for real estate development." As a percent of total loans, land loans represent 2.86% of the portfolio and construction loans total 5.37%.
The Return on Average Equity and Return on Average Assets for the nine months ended September 30, 2008 were 8.10% and .55% respectively, compared to 10.52% and .70% for the same period in 2007 respectively. "These are unprecedented financial times," continued Meyer, "and we are gratified for the continued support and growth from our core customers and the confidence they have placed in the Bank."
RMG Capital Corporation is the holding company for Fullerton Community Bank. The Bank is a community focused full-service bank which is headquartered in Fullerton, California and has been serving southern California since 1927. The Bank currently has eight retail branches and two regional business banking offices operating in southern California. The SBA division of the Bank, Business Community Capital, serves a broad constituency throughout the state of California and Nevada.
The statements contained in this news release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates and projections about RMG Capital Corporation and its subsidiary Fullerton Community Bank's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, the Company's actual results or performance may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including but not limited to the general business environment, the California real estate market, competitive conditions in the business and geographic areas in which the Company conducts its business and regulatory actions or changes. The Company disclaims any obligation to subsequently revise or update any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
RMG Capital Corporation and Subsidiaries
Consolidated Statement of Financial Condition (Unaudited)
Assets 09/30/08 09/30/07
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Cash and Due from Banks $ 17,121,000 $ 14,842,000
Federal Funds Sold 0 0
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Total cash and cash equivalents 17,121,000 14,842,000
Loans, net 692,601,000 617,847,000
Investment Securities HTM 0 994,000
Mortgage-backed Securities AFS, at fair value 2,870,000 4,996,000
Mortgage-backed Securities HTM 20,119,000 25,164,000
Accrued Interest Receivable 3,676,000 3,663,000
Investments in Real Estate, net 3,029,000 3,970,000
Real Estate Acquired through Foreclosure 458,000 0
Federal Home Loan Bank Stock, at cost 9,589,000 6,399,000
Cash Surrender Value of Life Insurance 7,818,000 7,528,000
Premises and Equipment, net 5,885,000 5,869,000
Other Assets 6,015,000 4,134,000
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Total Assets $ 769,181,000 $ 695,406,000
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Liabilities and Stockholders' Equity
Liabilities
Deposit Accounts $ 492,810,000 $ 497,620,000
FHLB Borrowings 194,400,000 113,900,000
Other Borrowings 1,237,000 11,000,000
Junior Subordinated Debentures 18,558,000 18,558,000
Accounts Payable and other Liabilities 10,630,000 6,141,000
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Total Liabilities 717,635,000 647,219,000
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Stockholders' Equity
Preferred stock, no par value; 1,000,000
shares authorized: 5,000 shares issued
and outstanding 4,823,000 4,823,000
Common stock, no par value; 10,000,000
shares authorized; 2,808,633 shares
issued and outstanding 3,509,000 3,757,000
Accumulated other comprehensive Income
(loss) (2,000) 23,000
Retained earnings 43,216,000 39,584,000
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Total Stockholders' Equity 51,546,000 48,187,000
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$ 769,181,000 $ 695,406,000
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RMG Capital Corporation
Consolidated Statement of Income (Unaudited)
For the six For the six
months ended months ended
09/30/08 09/30/07
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Interest income:
Interest on loans $ 33,608,000 $ 34,955,000
Interest and dividends on investments 1,296,000 381,000
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Total Interest Income 34,904,000 35,336,000
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Interest expense:
Interest on deposit accounts 6,899,000 12,577,000
Other interest expense 6,340,000 4,989,000
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Total Interest Expense 13,239,000 17,566,000
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Net Interest Income before provision for
loan losses 21,665,000 17,770,000
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Provision for loan losses 2,319,000 450,000
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Net Interest Income 19,346,000 17,320,000
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Noninterest income:
Loan servicing and other fees 2,124,000 1,709,000
Real estate operations, net -234,000 119,000
Gain on sale of loans, net 124,000 335,000
Other 254,000 521,000
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Total noninterest income 2,268,000 2,684,000
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Noninterest expense:
Compensation and other employee benefits 12,077,000 9,768,000
Occupancy 1,071,000 1,014,000
Equipment rental and data processing 782,000 766,000
Other expense and supplies 406,000 434,000
Other 2,626,000 2,605,000
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Total noninterest expense 16,962,000 14,587,000
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Income before income tax provision 4,652,000 5,417,000
Income tax provision 1,623,000 1,854,000
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Net Income $ 3,029,000 $ 3,563,000
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Tom Meyer
Vice President, RMG Capital Corp.
President, Fullerton Community Bank
(714) 578-7500