FNB Bancorp (FNBG)

[Enterprising Investor]

First National Bank of Northern California Reports Third Quarter 2014 Earnings of $0.44 Per Diluted Share (10/29/14)

FNB Bancorp (QTCQB: FNBG), parent company of First National Bank of Northern California (the “Bank”), today announced net earnings available to common shareholders for the third quarter of 2014 of $1,823,000 or $0.44 per diluted share, compared to net earnings available to common shareholders of $2,880,000 or $0.71 per diluted share for the third quarter of 2013. During the second quarter of 2014, FNB Bancorp signed a definitive agreement and submitted an application to the Office of the Comptroller of the Currency to purchase Valley Community Bank in an all stock transaction.

“During the third quarter of 2014, we were able to grow our loan portfolio, our securities portfolio and our total assets. Our borrowers began to utilize their lines of credit more than they have during the second quarter and real estate prices in the San Francisco Bay Area continued to rise. According to the Zillow Home Value Index, San Francisco home values are up 12.4% for the twelve months ended September 30, 2014. We are carefully watching the valuations currently being provided on our residential and commercial real estate appraisals as valuations surpass the highs before the last recession. Deposit trends during the third quarter were not as favorable. Overall, our deposits were down approximately $8 million or 1% from June 30, 2014 levels. The largest percentage declines were in the certificate of deposit segment of our deposit portfolio as brokered CDs obtained in our Oceanic Bank acquisition continue to mature and not be renewed. Declines were also noted in our savings and money market depository accounts, although at a lower decline rate. Total FHLB advances outstanding at the end of the third quarter were $16 million. Management has and will continue to utilize this low cost funding source when it is prudent to do so,” stated Tom McGraw, CEO.

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“During the third quarter, our net interest income and net interest margins increased when compared to the second quarter. The loan to deposit ratio increased to 74% at September 30, 2014 compared to 73% at year end. We are lending when it is prudent to do so, staying true to our conservative underwriting standards rather the increasing lending volume by accepting unwarranted risk into our loan pipeline. We continue to be “well capitalized” by regulatory capital standards. The Bank’s Tier 1 leverage capital ratio was 10.16% at September 30, 2014. The Bank’s Tier 1 risk-based capital ratio was 13.05% and our total risk-based capital was 14.30%. We also continue to look for bank acquisitions. A Form 8-K was filed with the SEC on October 23, 2014 which provided additional information concerning our pending acquisition of Valley Community Bank,” continued CEO Tom McGraw.

http://www.sec.gov/Archives/edgar/data/1163199/000101905614001335/ex99_01.htm