EXHIBIT 99.1
PRESS RELEASE
UNIONBANCORP, INC.
OTTAWA, ILLINOIS
FOR IMMEDIATE RELEASE
UNIONBANCORP, INC. ANNOUNCES ADDITION TO LOAN LOSS ALLOWANCE
OTTAWA, IL, December 26, 2000 - Charles J. Grako, President and Chief Executive
Officer of UnionBancorp, Inc. (Nasdaq: UBCD), announced today that it will add
$2.9 million to its allowance for loan losses during the fourth quarter of 2000.
The measure was influenced by a single non-performing commercial credit.
Throughout the first three quarters of 2000, the Company had been extending
additional funds on this commercial credit, but during the third quarter the
loan began to deteriorate and was appropriately recognized as a troubled credit.
In late November and early December, the Company continued to review this credit
and determined that an addition to the allowance was required. In addition to
this credit, there were a number of other loans identified in the fourth quarter
that had deteriorating conditions. In reaching the decision to provide $2.9
million to the allowance, management also considered several other factors,
including an increase in non-performing loans, general concerns over asset
quality and an increase in charge-offs during the first three quarters of 2000.
This provision will result in an allowance for loan losses of approximately $6.4
million, which will increase the Company's allowance-to-loan ratio to
approximately 1.28%. Management expects this decision will result in an
approximate after tax charge of $0.44 per fully diluted share for the fourth
quarter.
With respect to earnings, Grako remarked, "While the year 2000 has been a
trying one in the financial services arena, UnionBancorp maintains our
historically sound and diversified earnings base. Although this provision has a
material impact on earnings for the fourth quarter, we are taking a pro-active
approach in order to more fully realize our ultimate long-term objectives. Going
forward, we will continue to monitor and respond to risk in a manner that is in
the best interest of our shareholders and the communities we serve."
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UnionBancorp, Inc. is a regional financial services company based in Ottawa,
Illinois, and devotes special attention to personal service and offers Bank,
Trust, Insurance, Investment and Electronic Data Processing services at each of
its twenty-eight locations. The company's market area extends from the far
Western suburbs of the Chicago metropolitan area across Central and Northern
Illinois to the Mississippi River in Western Illinois.
This release may contain "forward-looking" statements. Forward looking
statements are identifiable by the inclusion of such qualifications as
"expects", "intends", "believes", "may", "likely" or other indications that the
particular statements are not based upon fact but are rather based upon the
company's beliefs as of the date of this release. Actual events and results may
differ significantly from those described in such forward-looking statements,
due to changes in the economy, interest rates or other factors. For additional
information about these factors, please review our filings with the Securities
and Exchange Commission.
CONTACT: Charles J. Grako Kurt R. Stevenson
President and Vice President and
Chief Executive Officer Chief Financial Officer
UnionBancorp, Inc. UnionBancorp, Inc.
(800) 352-8223 (800) 352-8223
[email protected] [email protected]
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