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ASHEVILLE, N.C., July 25 /PRNewswire-FirstCall/ -- Weststar Financial Services Corporation (OTC Bulletin Board: WFSC) reported June 30, 2008 consolidated assets of $182.9 million -- an 11% increase over June 30, 2007. Asset growth was primarily realized in loans, which increased 20% to $148.3 million. At June 30, 2008, the Company's allowance for loan losses represented 1.52% of outstanding loans. Deposits reflected 10.2% growth to $155.2 million at June 30, 2008 compared to the prior year. Shareholders' equity increased 15% over June 30, 2007 to $15.8 million at June 30, 2008.
Consolidated net income totaled $282 thousand for the three months ended June 30, 2008 compared to $525 thousand for the comparable period in 2007 -- a decrease of 46%. On a diluted per share basis, earnings for the three-month periods of 2008 and 2007 were $.12 vs. $.23 -- a decrease of 48%. For the six-month periods ended June 30, 2008, net income totaled $671 thousand compared to $1,025 thousand for the comparable period in 2007 -- a decrease of 35%. On a diluted per share basis, earnings for the six-month periods ended June 20, 2008 and 2007, respectively, were $.29 and $.45 -- a decrease of 36%. The decrease in earnings was primarily attributable to an increase in the provision for loan losses to accommodate loan growth and decreased net interest income resulting from Federal Open Market Committee interest rate cut initiatives and not to any subprime lending. As a result of exceptional loan growth during the latter part of the second quarter, the Company added $150,680 to the loan loss reserve during the quarter and $188,125 during the six-month period -- an increase of 116% and 115%, respectively, compared to comparable periods during 2007. The increased provision negatively impacts net income during the short-term; however, the benefits result in long-term streams of cash flows. Asset quality remained strong and demonstrated continued improvement with nonperforming loans to total assets of .10%, .11% and .20% at June 30, 2008, December 31, 2007 and June 30, 2007, respectively.
Return on assets was .64% compared to 1.28%, and return on equity was 7.14% compared to 15.30% for the three-month periods ended June 30, 2008 and 2007, respectively. For the six-month periods ended June 30, 2008 and 2007, respectively, return on assets was .76% compared to 1.27%, and return on equity was 8.59% compared to 15.30%.
G. Gordon Greenwood, President and Chief Executive Officer, stated, "Given our current economic environment, we are pleased with our performance. Our loan portfolio continues to perform well, and our earnings exceed peers in all market statistics. In a recent market analysis by Silverton Capital Corporation for banks with assets between $150 million and $250 million, Weststar's return on assets was 218% better than the median, and return on equity was 122% above the median for the quarter ended March 31, 2008. As in past periods of economic slowing, our market has performed better than the national average, and we continue to feel that this will be what happens during the remainder of the year. We will continue to manage the Bank with sound and cautious policies that have served us well for the past 11 years."
Weststar Financial Services Corporation is the parent company of The Bank of Asheville. Weststar Financial Services Corporation owns 100% interest in Weststar Financial Services Corporation I, a statutory trust. The Bank operates five full-service banking offices in Buncombe County, North Carolina -- Downtown Asheville, Candler, Leicester, South Asheville and Reynolds.
This news release contains forward-looking statements. Such statements are subject to certain factors that may cause the company's results to vary from those expected. These factors include changing economic and financial market conditions, competition, ability to execute our business plan, items already mentioned in this press release, and other factors described in our filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's judgment only as of the date hereof. The company undertakes no obligation to publicly revise these forward-looking statements to reflect events and circumstances that arise after the date hereof.
Weststar Financial Services Corporation & Subsidiary
Selected Financial Data
Three Months Ended
June 30, June 30,
2008 2007 % change
Consolidated earning summary:
Interest income $2,895,378 $3,206,796 -9.7%
Interest expense 1,185,292 1,315,067 -9.9%
Net interest income 1,710,086 1,891,729 -9.6%
Provision for loan losses 150,680 69,720 116.1%
Net interest income after
provision for loan losses 1,559,406 1,822,009 -14.4%
Other income 415,849 394,114 5.5%
Other expenses 1,563,388 1,398,247 11.8%
Income before taxes 411,867 817,876 -49.6%
Income taxes 129,384 293,304 -55.9%
Net income $282,483 $524,572 -46.2%
Earnings per share - Basic $0.13 $0.25 -48.0%
Earnings per share - Diluted 0.12 0.23 -47.8%
Average Shares - Basic 2,119,461 2,104,131 0.7%
Average Shares - Diluted 2,279,884 2,282,642 -0.1%
Consolidated average balance sheet data:
Total Assets $178,016,532 $163,905,840 8.6%
Total Deposits 151,838,703 137,448,436 10.5%
Loans (gross) 141,392,197 127,164,672 11.2%
Investments 26,011,589 26,733,213 -2.7%
Shareholders' Equity 15,920,103 13,752,135 15.8%
Consolidated performance ratios:
Return on average assets* 0.64% 1.28%
Return on average equity* 7.14% 15.30%
Capital to Assets 8.94% 8.39%
Six Months Ended
June 30, June 30,
2008 2007 % change
Consolidated earning summary:
Interest income $5,975,791 $6,300,595 -5.2%
Interest expense 2,532,424 2,576,811 -1.7%
Net interest income 3,443,367 3,723,784 -7.5%
Provision for loan losses 188,125 87,575 114.8%
Net interest income after
provision for loan losses 3,255,242 3,636,209 -10.5%
Other income 790,883 744,483 6.2%
Other expenses 3,032,980 2,773,517 9.4%
Income before taxes 1,013,145 1,607,175 -37.0%
Income taxes 342,525 582,572 -41.2%
Net income $670,620 $1,024,603 -34.6%
Earnings per share - Basic $0.32 $0.49 -34.7%
Earnings per share - Diluted 0.29 0.45 -35.6%
Average Shares - Basic 2,119,208 2,107,427 0.6%
Average Shares - Diluted 2,279,723 2,288,086 -0.4%
Consolidated balance sheet data:
Total Assets $182,923,687 $164,412,455 11.3%
Total Deposits 155,212,188 140,915,216 10.2%
Loans (gross) 148,338,170 123,199,519 20.4%
Investments 25,076,449 25,777,376 -2.7%
Shareholders' Equity 15,782,299 13,681,118 15.4%
Consolidated average balance sheet data:
Total Assets $176,669,664 $162,273,246 8.9%
Total Deposits 150,721,313 137,521,725 9.6%
Loans (gross) 139,234,303 125,395,267 11.0%
Investments 26,190,687 26,484,051 -1.1%
Shareholders' Equity 15,698,508 13,504,117 16.3%
Consolidated performance ratios:
Return on average assets* 0.76% 1.27%
Return on average equity* 8.59% 15.30%
Capital to Assets 8.89% 8.32%
Consolidated asset quality data and ratios:
Nonaccruing loans $187,157 $326,865 -42.7%
Accruing loans 90 days past due - 1,000 -100.0%
Nonperforming loans 187,157 327,865 -42.9%
Foreclosed properties 51,006 574,633 -91.1%
Nonperforming assets 238,163 902,498 -73.6%
Allowance for loan losses 2,252,385 1,929,498 16.7%
Loans charged off 46,812 59,018 -20.7%
Recoveries of loans charged off 20,946 16,862 24.2%
Net loan charge-offs 25,866 42,156 -38.6%
Net charge-offs to average loans* 0.04% 0.07% -42.9%
Nonperforming loans to total assets 0.10% 0.20% -50.0%
Allowance coverage of nonperforming
loans 1203.47% 588.50% 104.5%
Allowance for loan losses to gross
loans 1.52% 1.57% -3.2%
*Annualized based on number of days in the period.
Weststar Financial Services Corporation & Subsidiary
Supplemental Quarterly Financial Data
Quarters Ended
Jun 30, Mar 31, Dec 31,
2008 2008 2007
Consolidated earning summary:
Interest income $2,895,378 $3,080,413 $3,285,876
Interest expense 1,185,292 1,347,132 1,355,650
Net interest income 1,710,086 1,733,281 1,930,226
Provision for loan losses 150,680 37,445 181,755
Net interest income after
provision for loan losses 1,559,406 1,695,836 1,748,471
Other income 415,849 375,034 397,499
Other expenses 1,563,388 1,469,592 1,411,526
Income before taxes 411,867 601,278 734,444
Income taxes 129,384 213,141 245,969
Net income $282,483 $388,137 $488,475
Earnings per share - Basic $0.13 $0.18 $0.23
Earnings per share - Diluted 0.12 0.17 0.21
Average Shares - Basic 2,119,461 2,118,956 2,117,973
Average Shares - Diluted 2,279,884 2,279,551 2,283,290
Consolidated balance sheet data:
Total Assets $182,923,687 $180,968,119 $174,257,998
Total Deposits 155,212,188 155,155,491 149,191,016
Loans (gross) 148,338,170 137,192,577 135,734,224
Investments 25,076,449 26,494,464 26,113,294
Shareholders' Equity 15,782,299 15,793,519 15,179,239
Consolidated average balance
sheet data:
Total Assets $178,016,532 $175,340,851 $171,465,008
Total Deposits 151,838,703 149,617,026 146,633,893
Loans (gross) 141,392,197 137,076,409 133,456,205
Investments 26,011,589 26,369,785 26,579,297
Shareholders' Equity 15,920,103 15,476,307 14,893,132
Consolidated performance ratios:
Return on average assets* 0.64% 0.89% 1.13%
Return on average equity* 7.14% 10.09% 13.01%
Capital to Assets 8.94% 8.83% 8.69%
Consolidated asset quality data
and ratios:
Nonaccruing loans $187,157 $189,126 $195,683
Accruing loans 90 days past due - - -
Nonperforming loans 187,157 189,126 195,683
Foreclosed properties 51,006 87,787 87,787
Nonperforming assets 238,163 276,913 283,470
Allowance for loan losses 2,252,385 2,110,658 2,090,125
Loans charged off 16,910 29,902 89,549
Recoveries of loans charged off 7,956 12,990 29,464
Net loan charge-offs 8,954 16,912 60,085
Net charge-offs to average loans* 0.03% 0.05% 0.18%
Nonperforming loans to total
assets 0.10% 0.10% 0.11%
Allowance coverage of nonperforming
loans 1203.47% 1116.01% 1068.12%
Allowance for loan losses to gross
loans 1.52% 1.54% 1.54%
Quarters Ended
Sept 30, Jun 30,
2007 2007
Consolidated earning summary:
Interest income $3,314,963 $3,206,796
Interest expense 1,363,045 1,315,067
Net interest income 1,951,918 1,891,729
Provision for loan losses 137,395 69,720
Net interest income after provision
for loan losses 1,814,523 1,822,009
Other income 386,784 394,114
Other expenses 1,368,193 1,398,247
Income before taxes 833,114 817,876
Income taxes 300,186 293,304
Net income $532,928 $524,572
Earnings per share - Basic $0.25 $0.25
Earnings per share - Diluted 0.23 0.23
Average Shares - Basic 2,113,485 2,104,131
Average Shares - Diluted 2,287,007 2,282,642
Consolidated balance sheet data:
Total Assets $170,393,834 $164,412,455
Total Deposits 145,911,704 140,915,216
Loans (gross) 129,952,653 123,199,519
Investments 27,050,604 25,777,376
Shareholders' Equity 14,519,658 13,681,118
Consolidated average balance sheet data:
Total Assets $166,531,452 $163,905,840
Total Deposits 142,455,579 137,448,436
Loans (gross) 125,301,745 127,164,672
Investments 26,531,300 26,733,213
Shareholders' Equity 14,071,165 13,752,135
Consolidated performance ratios:
Return on average assets* 1.27% 1.28%
Return on average equity* 15.03% 15.30%
Capital to Assets 8.45% 8.39%
Consolidated asset quality data and ratios:
Nonaccruing loans $96,968 $326,865
Accruing loans 90 days past due - 1,000
Nonperforming loans 96,968 327,865
Foreclosed properties 87,787 574,633
Nonperforming assets 184,755 902,498
Allowance for loan losses 1,968,455 1,929,498
Loans charged off 108,174 38,846
Recoveries of loans charged off 9,735 10,567
Net loan charge-offs 98,439 28,279
Net charge-offs to average loans* 0.31% 0.09%
Nonperforming loans to total assets 0.06% 0.20%
Allowance coverage of nonperforming loans 2030.00% 588.50%
Allowance for loan losses to gross loans 1.51% 1.57%
* Annualized based on number of days in the period.
SOURCE Weststar Financial Services Corporation
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