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NEWS RELEASE
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FOR IMMEDIATE RELEASE MEDIA & INVESTOR CONTACTS:
--------------------------
David Taber, President & CEO
AMERICAN RIVER HOLDINGS
(916) 565-6114
Mitchell A. Derenzo, Chief Financial Officer
AMERICAN RIVER HOLDINGS
(916) 565-6123
SACRAMENTO, CA - APRIL 12, 2000
AMERICAN RIVER HOLDINGS ANNOUNCES RESULTS OF FIRST QUARTER 2000
American River Holdings, (AMRB.OB) the parent of American River Bank and First
Source Capital, reported today a 20% increase in earnings per share and a 13%
growth in total assets for the First Quarter of 2000. Return on average equity
and return on average assets for this financial services holding company were
19% and 1.61%, respectively. The asset quality of the company remained strong.
Earnings per share were 42 cents for the quarter ended March 31, 2000, up 20%
from the 35 cents reported in the same quarter one year earlier. This quarterly
profit was the 65th consecutive profitable quarter for this company. Total net
income for the quarter was $794,000 up from the $673,000 posted one year
earlier. This was a result of a higher net interest margin of $186,000, a
$151,000 increase in total other income with a corresponding increase in
overhead of $145,000. The increase in net interest margin stems from an overall
increase in average earning assets and a general increase in overall interest
rates. The increase in total other income was mainly attributable to a $60,000
increase in revenue from the receivables management division and revenue of
$37,000 from First Source Capital, which began business in the third quarter of
1999. The increase in non-interest expense included $93,000 increase in salaries
and benefits for the company, $28,000 of which was for First Source Capital. In
addition, other expenses were up $31,000, which included resolution of a legal
matter.
Total assets increased $22.5 million to $197.3 million. This increase in the
company's balance sheet was centered in investment securities growing by $14
million, loans growing by $5 million, and AR servicing receivables up $1.5
million. The growth in assets was funded by a $21 million increase in deposits
and $1.6 million increase in equity.
Performance ratios for the company were solid including a return on average
equity for the quarter of 18.99%, up from 17.49% in the same period last year.
The return on average assets for the quarter ended March 31, 2000, was 1.61% up
from the 1.56% recorded in the corresponding quarter in 1999. The efficiency
ratio for the company was 52.16%, an improvement from the 53.37% recorded in
the same period in 1999.
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News Release - April 12, 2000
Page two
On March 31, 2000, there was no other real estate owned. Non-performing loans,
including those on non-accrual and those still accruing interest yet past due 90
days, totaled just $61,000 at March 31, 2000. The Allowance for Loan and Lease
Losses at March 31, 2000, was $1,736,000; or 1.44% of the total loans
outstanding as of March 31, 2000, and net chargeoffs to average loans for the
quarter was a very low 2/10ths of 1%.
This solid quarterly performance announcement comes on the heels of a public
announcement made on March 1, 2000 whereby American River Holdings (AMRB.OB) and
North Coast Bank (NCTA.OB) announced a strategic merger. The merger agreement
calls for North Coast Bank shareholders to receive .9644 of a share of American
River Holdings common stock in a tax-free exchange for each North Coast Bank
common share that they own. North Coast Bank will continue to operate as North
Coast Bank in Sonoma County, joining American River Bank which serves Sacramento
and Placer Counties, and First Source Capital as affiliates of American River
Holdings, a diversified financial services company. North Coast Bank will
continue to be led by its existing Board of Directors with the addition of two
directors from American River Holdings. Two North Coast Bank directors will join
the Board of American River Holdings. The combined assets of these companies
were approximately $250 million at March 31, 2000. The transaction will be
accounted for as a pooling of interests and it is expected that this merger will
be accomplished in the third quarter of 2000, subject to shareholder and
regulatory approval.
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This news release contains forward-looking statements about American River
Holdings' and North Coast Bank's financial condition, results of operations,
plans, objectives and future performance. A number of factors, any of which are
beyond the control of American River Holdings or North Coast Bank could cause
actual results to differ materially from those in the forward-looking
statements.
American River Holdings will file a registration statement with the Securities
and Exchange Commission to register the securities of American River Holdings to
be offered and issued to shareholders of North Coast Bank in the proposed
transaction. The registration statement will include a proxy
statement/prospectus that will be sent to the shareholders of both companies,
seeking their approval of the proposed transaction. The registration statement
and other documents concerning the proposed transaction, when filed with the
Commission, may also be obtained without charge at the Commission's website at:
http://www.sec.gov. Shareholders are urged to read the documents to be filed
with the Commission because they contain important information.
This news release does not constitute an offer to sell to, or a solicitation of
an offer to buy from anyone in any state or jurisdiction in which such an offer
or solicitation is not authorized. The securities described in this news release
have not been registered with or approved by the Securities and Exchange
Commission or any state securities authority nor has the Commission or any
regulatory authority or any state passed upon the accuracy or adequacy of this
news release. Any representation to the contrary is unlawful. No person other
than the company has been authorized to give any information or to make any
representations other than those contained in this news release in connection
with the securities described therein, and, if given or made, such other
information or representation must not be relied upon as having been made or
authorized by the company.
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<TABLE>
<CAPTION>
AMERICAN RIVER HOLDINGS FINANCIAL SUMMARY
(unaudited)
STATEMENT OF CONDITION MARCH 31 MARCH 31 PERCENT
2000 1999 CHANGE
------------ ------------ --------
<S> <C> <C> <C>
ASSETS
CASH & DUE FROM BANKS $ 18,167,000 $ 16,814,000 8.05%
INVESTMENTS 54,747,000 40,261,000 35.98%
NET LOANS 118,485,000 113,788,000 4.13%
BANK PREMISES & FF&E 542,000 413,000 31.23%
AR SERVICING RECEIVABLE 2,280,000 875,000 160.57%
OTHER ASSETS 3,108,000 2,705,000 14.90%
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TOTAL ASSETS $197,329,000 $174,856,000 12.85%
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LIABILITIES
TOTAL DEPOSITS $176,329,000 $155,800,000 13.18%
SHORT & LONG-TERM BORROWINGS 2,115,000 2,154,000 -1.81%
OTHER LIABILITIES 1,485,000 1,055,000 40.76%
------------ ------------ --------
TOTAL LIABILITIES 179,929,000 159,009,000 13.16%
TOTAL EQUITY CAPITAL 17,400,000 15,847,000 9.80%
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TOTAL LIABILITIES & CAPITAL $197,329,000 $174,856,000 12.85%
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OPERATING RATIOS (THROUGH MARCH 31):
RETURN ON AVERAGE ASSETS 1.61% 1.56%
RETURN ON AVERAGE EQUITY 18.99% 17.49%
EFFICIENCY RATIO 52.16% 53.37%
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STATEMENT OF INCOME FIRST FIRST
(unaudited) QUARTER QUARTER PERCENT
2000 1999 CHANGE
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TOTAL INTEREST INCOME $ 3,766,000 $ 3,282,000 14.75%
TOTAL INTEREST EXPENSE 1,317,000 1,019,000 29.24%
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NET INTEREST MARGIN $ 2,449,000 $ 2,263,000 8.22%
PROVISION FOR LOAN LOSSES 105,000 94,000 11.70%
TOTAL OTHER INCOME 455,000 304,000 49.67%
TOTAL OTHER EXPENSES 1,525,000 1,380,000 10.51%
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PRETAX INCOME $ 1,274,000 $ 1,093,000 16.56%
INCOME TAXES 480,000 420,000 14.29%
NET INCOME $ 794,000 $ 673,000 17.98%
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EARNINGS PER SHARE--BASIC $ 0.44 $ 0.37 18.92%
EARNINGS PER SHARE--DILUTED $ 0.42 $ 0.35 20.00%
TRAILING 12-MONTHS DILUTED EPS $ 1.58 $ 1.33 18.80%
AVERAGE SHARES OUTSTANDING 1,793,274 1,832,036
</TABLE>
EARNINGS PER SHARE HAVE BEEN ADJUSTED FOR 5% STOCK DIVIDENDS IN OCTOBER 1998 AND
OCTOBER 1999 AND A 3 FOR 2 SPLIT IN MAY 1999.
