<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 14, 1999
Greater Bay Bancorp
(Exact name of registrant as specified in its charter)
California 77-0387041
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
Commission file number: 0-25034
2860 West Bayshore Road
Palo Alto, California 94303
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (650) 813-8200
<PAGE>
Item 5. Other Events.
(a) On October 15, 1999, Greater Bay Bancorp (the "Registrant")
consummated its merger with Bay Commercial Services ("BCS") pursuant to an
Agreement and Plan of Reorganization, dated as of April 30, 1999 (the
"Agreement"), providing for the merger of BCS with and into the Registrant (the
"Merger"). In accordance with the Agreement, former shareholders of BCS received
0.6833 shares of the Registrant's common stock in exchange for each of their
shares of BCS common stock. As a result of the Merger, Bay Bank of Commerce,
formerly a wholly owned subsidiary of BCS, became a wholly owned subsidiary of
the Registrant. The Merger was accounted for as a pooling of interests.
The Registrant issued a press release announcing completion of the Merger
on October 15, 1999, a copy of which is attached hereto as Exhibit 99.1.
For a more detailed discussion of the terms and conditions of the Agreement
and the Merger, reference is made to the Registrant's Registration Statement on
Form S-4 (Registration No. 333-82355) filed with the Securities and Exchange
Commission on July 7, 1999, as amended by Amendment No. 1 thereto filed with the
Securities and Exchange Commission on August 4, 1999, incorporated herein by
this reference.
(b) On October 14, 1999, the Registrant issued a press release announcing
its third quarter earnings, a copy of which is attached hereto as Exhibit 99.2.
Item 7. Financial Statements and Exhibits.
Exhibits
- --------
2.1 Agreement and Plan of Reorganization, dated as of April 30, 1999, by and
between Greater Bay Bancorp and Bay Commercial Services (incorporated by
reference from the Registrant's Current Report on Form 8-K dated May 6,
1999)
99.1 Press Release dated October 15, 1999
99.2 Press Release dated October 14, 1999
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Greater Bay Bancorp
(Registrant)
Dated: October 19, 1999 By: /s/ Linda M. Iannone
--------------------
Linda M. Iannone
Senior Vice President and General
Counsel
3
<PAGE>
Exhibit Index
-------------
2.1 Agreement and Plan of Reorganization, dated as of April 30, 1999, by and
between Greater Bay Bancorp and Bay Commercial Services (incorporated by
reference from the Registrant's Current Report on Form 8-K dated May 6,
1999)
99.1 Press Release dated October 15 1999
99.2 Press Release dated October 14, 1999
4
<PAGE>
EXHIBIT 99.1
For Information Contact
- -----------------------
At Greater Bay Bancorp: At Financial Relations Board:
David L Kalkbrenner, President & CEO Christina Carrabino (general information)
(650) 614-5767 Kristi Larson (analyst contact)
Steven C. Smith, EVP, CAO & CFO (415) 986-1591
(650) 813-8222
FOR IMMEDIATE RELEASE
GREATER BAY BANCORP ANNOUNCES COMPLETION
OF MERGER WITH BAY COMMERCIAL SERVICES
PALO ALTO, CA, October 15, 1999 -- Greater Bay Bancorp (Nasdaq: GBBK) today
announced that the merger with Bay Commercial Services, the holding company for
Bay Bank of Commerce, San Leandro, California, was completed on October 15,
1999. The transaction furthers the strategic plan of Greater Bay Bancorp in
becoming the preeminent independent bank holding company in Northern California.
Each Bay Commercial Services shareholder will receive 0.6833 shares of Greater
Bay Bancorp stock for each share of Bay Commercial Services in a tax-free
exchange. The merger will be accounted for as a pooling of interests. Following
the transaction, Bay Bank of Commerce, a wholly owned subsidiary of Bay
Commercial Services, will operate as a wholly owned subsidiary of Greater Bay
Bancorp. Based on September 30, 1999 financial information, the combined company
will have total assets of approximately $2.44 billion and shareholders' equity
of approximately $134 million.
Greater Bay Bancorp and its financial services subsidiaries, Bay Area Bank, Bay
Bank of Commerce, Cupertino National Bank, Mid-Peninsula Bank, Peninsula Bank of
Commerce and Golden Gate Bank, along with its operating divisions, Greater Bay
Bank Santa Clara Valley Commercial Banking Group, Greater Bay Corporate Finance
Group, Greater Bay Bank Contra Costa Region, Greater Bay International Banking
Division, Greater Bay Trust Company, Pacific Business Funding and Venture
Banking Group, serve clients throughout Silicon Valley, the San Francisco
Peninsula and the Contra Costa Tri-Valley Region, with offices located in
Cupertino, Hayward, Millbrae, Palo Alto, Redwood City, San Francisco, San Jose,
San Leandro, San Mateo, San Ramon, Santa Clara and Walnut Creek.
This document may contain forward-looking statements that are subject to risks
and uncertainties that could cause actual results to differ materially from
those projected. For a discussion of factors that could cause actual results to
differ, please see the Company's publicly available Securities and Exchange
Commission filings, including its Annual Report on Form 10-K for the year ended
December 31, 1998, and particularly the discussion of risk factors within that
document.
<PAGE>
EXHIBIT 99.2
For Information Contact
- -----------------------
At Greater Bay Bancorp: At Financial Relations Board:
David L. Kalkbrenner Christina Carrabino (general information)
President and CEO Kristi Larson (analyst contact)
(650) 614-5767 (415) 986-1591
Steven C. Smith
EVP, CAO and CFO
(650) 813-8222
FOR IMMEDIATE RELEASE
GREATER BAY BANCORP REPORTS RECORD OPERATING RESULTS
WITH A 37% INCREASE IN NET INCOME AND 35% INCREASE IN TOTAL ASSETS
PALO ALTO, CA, October 14, 1999 -- Greater Bay Bancorp (Nasdaq: GBBK), a $2.3
billion in assets financial services holding company, today announced record
results for the third quarter and nine months ended September 30, 1999. Net
income, before merger and related non-recurring and extraordinary items for the
---------------------------------------------------------------
third quarter, increased 37% to $7.4 million or $0.62 per diluted share,
compared to $5.4 million or $0.46 per diluted share for the third quarter of
1998.
For the nine months ended September 30, 1999, net income, before merger and
-----------------
related non-recurring and extraordinary items, was $19.6 million or $1.66 per
- ---------------------------------------------
diluted share, up 34% from the $14.6 million or $1.26 per diluted share for the
same period of the prior year. Merger and related non-recurring and
extraordinary items were $2.5 million for the first nine months of 1999 and $1.3
million for the first nine months of 1998. Including these items, net income was
$17.0 million or $1.44 per diluted share for the first nine months of 1999,
compared with $13.3 million or $1.14 per diluted share for the first nine months
of 1998.
At September 30, 1999, Greater Bay Bancorp's total assets were $2.3 billion, an
increase of 35% or $597 million from September 30, 1998. Total loans grew to
$1.5 billion, an increase of $522 million or 54% compared to total loans at
September 30, 1998. Total deposits increased to $2.0 billion at quarter end, a
$612 million or 43% increase since September 30, 1998.
For the third quarter of 1999, Greater Bay Bancorp's return on average equity,
return on average assets and efficiency ratio were 24.50%, 1.34% and 47.96%,
respectively, compared to 21.34%, 1.30%, and 53.37%, respectively, for the third
quarter of 1998. For the year to date 1999, Greater Bay Bancorp's return on
average equity, return on average assets and efficiency ratio were 22.63%, 1.30%
and 51.44%, respectively, compared to 16.55%, 1.19% and 55.79%, respectively,
for the same period a year ago.
Greater Bay Bancorp's merger with Bay Commercial Services is expected to close
on October 15, 1999. As a result of the merger, Bay Bank of Commerce, a wholly
owned subsidiary of Bay Commercial Services, will become a wholly owned
subsidiary of Greater Bay Bancorp. The Company recently signed a definitive
agreement to merge with Mt. Diablo Bancshares, parent of
<PAGE>
Mt. Diablo National Bank. This transaction is expected to close early in the
first quarter of 2000. On a pro forma basis after these acquisitions are
completed, Greater Bay Bancorp would have approximately $2.6 billion in assets,
as of September 30, 1999.
"Once again, Greater Bay Bancorp continued to deliver excellent operating
results combined with outstanding quality loan growth," said David L.
Kalkbrenner, president and chief executive officer. "Our company's non-
performing asset ratio continues to remain at very low levels compared to our
peer banks, and our delinquent loans are at their lowest level in over two
years."
Mr. Kalkbrenner continued, "During the quarter, we signed a definitive merger
agreement with Mt. Diablo Bancshares, the holding company for Mt. Diablo
National Bank, with offices in Danville, Lafayette, Pleasanton and the Blackhawk
Community. Combined with Bay Bank of Commerce's offices in Hayward, San Leandro
and San Ramon, and the new Greater Bay Bank offices in Walnut Creek and Fremont,
we are in an excellent position to continue our expansion in the dynamic East
Bay Region of the San Francisco Bay Area."
Mr. Kalkbrenner added, "We continue to focus on Greater Bay Bancorp's Super
Community Banking strategy and this is having a very positive impact on our
ability to increase market share and our relationship client base in the
communities we serve."
Operating results for the three months and nine months ended September 30, 1999,
include approximately $28,000 and $206,000 respectively (excluding internal
staff time) related to the correction of the year 2000 "millennium bug" which
impacts all companies. The Company has budgeted an anticipated total expenditure
of $300,000 in fiscal 1999 to address year 2000 issues. The Company has met all
of its Year 2000 regulatory guidelines.
Greater Bay Bancorp's ratio of non-performing assets to total assets was 0.32%
at September 30, 1999, compared to 0.26% at September 30, 1998. In addition, the
allowance for loan losses represented 2.00% of total loans at September 30,
1999, compared to 1.93% at June 30, 1999 and 2.27% at September 30, 1998.
Non-interest income increased to $4.1 million in the third quarter of 1999 from
$2.3 million in the third quarter of 1998. The core increase in non-interest
income, excluding a $900,000 gain on an equity investment, was approximately
$1.0 million or a 43% increase from the third quarter of 1998.
Greater Bay Bancorp's capital ratios continue to be above the well-capitalized
guidelines established by the bank regulatory agencies.
Greater Bay Bancorp and its financial services subsidiaries, Bay Area Bank,
Cupertino National Bank, Golden Gate Bank, Mid-Peninsula Bank and Peninsula Bank
of Commerce, along with its operating divisions, Greater Bay Bank Contra Costa
Region, Greater Bay Bank Fremont Region, Greater Bay Bank Santa Clara Commercial
Banking Group, Greater Bay Corporate Finance Group, Greater Bay International
Banking Division, Greater Bay Trust Company, Pacific Business Funding and
Venture Banking Group, serve clients throughout Silicon Valley, the San
Francisco Peninsula and the Contra Costa Tri Valley Region, with offices located
in Cupertino,
<PAGE>
Millbrae, Palo Alto, Redwood City, San Francisco, San Jose, San Mateo, Santa
Clara and Walnut Creek.
Safe Harbor
This document may contain forward-looking statements that are subject to risks
and uncertainties that could cause actual results to differ materially from
those projected. For a discussion of factors that could cause actual results to
differ, please see the publicly available Securities and Exchange Commission
filings of Greater Bay Bancorp, including the Annual Report on Form 10-K for the
year ended December 31, 1998, and particularly the discussion of risk factors
with such documents.
For investor information on Greater Bay Bancorp at no charge, call our automated
shareholder information line at 1-800-PRO-INFO (1-800-776-4636) and enter code
GBBK. For international access, dial 1-201-432-6555.
<PAGE>
GREATER BAY BANCORP
September 30, 1999 - FINANCIAL SUMMARY
($ in 000's, except share and per share data)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SELECTED QUARTERLY CONSOLIDATED FINANCIAL CONDITION DATA:
Sept 30 Jun 30 Mar 31 Dec 31 Sept 30
1999 1999 1999 1998 1998
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Cash and Due from Banks $ 98,863 $ 90,246 $ 79,244 $ 69,503 $ 66,536
Investments 527,383 606,442 511,842 497,667 609,781
Loans:
Commercial 687,402 648,483 594,546 488,668 412,343
Construction 207,761 256,253 219,993 215,274 190,070
Real Estate 413,536 353,071 352,820 332,478 279,095
Consumer and Other 100,051 99,968 96,460 88,450 83,330
Deferred Loan Fees, Net (5,531) (5,133) (4,903) (3,896) (3,443)
------------ ------------ ------------ ------------ ------------
Total Loans 1,484,019 1 351,462 1,250,925 1,115,982 962,203
Allowance for Loan Losses (20,600) (26,066) (24,046) (23,379) (21,562)
------------ ------------ ------------ ------------ ------------
Total Loans, Net 1,454,339 1,325,376 1,234,879 1,092,603 940,341
Other Assets 103,302 91,540 82,487 78,116 68,330
------------ ------------ ------------ ------------ ------------
Total Assets $ 2,283,867 $ 2,113,612 $ 1,938,452 $ 1,738,109 $ 1,686,988
============ ============ ============ ============ ============
Deposits:
Demand, Non-interest Bearing $ 375,302 $ 324,019 $ 316,054 $ 302,006 $ 274,091
NOW, MMDA and Savings 1,242,114 1,124,354 996,856 922,581 860,871
Time Certificates, $100,000 and over 353,607 320,286 298,959 190,312 224,140
Other Time Certificates 61,634 61,998 63,076 64,048 61,882
------------ ------------ ------------ ------------ ------------
Total Deposits 2,032,737 1,830,657 1,075,044 1,476,941 1,420,904
------------ ------------ ------------ ------------ ------------
Other Borrowings 52,000 90,435 72,288 76,234 92,235
Other Liabilities 29,112 27,397 27,082 22,967 18,011
------------ ------------ ------------ ------------ ------------
Total Liabilities 2,113,849 1,948,409 1,775,214 1,578,148 1,531,230
------------ ------------ ------------ ------------ ------------
Long-term Subordinated Debt _ _ _ 3,000 3,000
Trust Preferred Securities 50,000 50,000 50,000 50,000 50,000
Stockholders' Equity 120,036 115,123 113,238 107,011 102,750
------------ ------------ ------------ ------------ ------------
Regulatory Capital 170,038 165,123 163,238 160,041 155,758
------------ ------------ ------------ ------------ ------------
Total Liabilities and Shareholders' Equity $ 2,283,887 $ 2,113,012 $ 1,038,452 $ 1,738,189 $ 1,686,988
============ ============ ============ ============ ============
Average Quarterly Total Loans, excluding Nonaccrual $ 1,419,303 $ 1,310,519 $ 1,187,214 $ 1,000,858 $ 926,399
Average Quarterly Investments $ 614,570 $ 598,984 $ 489,004 $ 582,428 $ 815,270
Average Quarterly Interest Bearing Liabilities $ 1,702,360 $ 1,602,021 $ 1,397,742 $ 1,319,199 $ 1,244,656
Average Quarterly Assets $ 2,184,002 $ 2,052,312 $ 1,810,870 $ 1,731,075 $ 1,634,178
Average Quarterly Equity $ 119,302 $ 117,713 $ 110,513 $ 104,710 $ 99,941
Regulatory Capital
Tier 1 or Leverage Capital $ 165,062 $ 155,557 $ 145,260 $ 137,652 $ 129,757
Total Capital $ 197,102 $ 187,196 $ 181,900 $ 176,902 $ 169,838
Nonperforming Assets
Nonaccrual Loans $ 5,584 $ 3,375 $ 2,002 $ 2,003 $ 3,061
Loans 90 Days Past Due & Accruing _ _ _ _ _
Restructured Loans 1,023 565 482 327 377
OREO 515 595 620 966 905
------------ ------------ ------------ ------------ ------------
Total Nonperforming Assets $ 7,422 $ 4,535 $ 4,094 $ 3,296 $ 4,343
============ ============ ============ ============ ============
Greater Bay Trust Company Assets $ 652,054 $ 659,414 $ 630,540 $ 640,336 $ 581,437
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SELECTED QUARTERLY CONSOLIDATED FINANCIAL CONDITION RATIOS:
Sept 30 Jun 30 Mar 31 Dec 31 Sept 30
1999 1999 1999 1998 1998
---------- ---------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Loan to Deposit Ratio 73.01% 73.02% 75.12% 75.46% 67.71%
Ratio of Allowance for Loan losses in:
Total Loans 2.00% 1.93% 1.91% 2.09% 2.7%
Total Nonperforming Assets 399.89% 575.21% 587.35% 709.31% 503.36%
Total Nonperforming Assets to Total Assets 0.32% 0.21% 0.21% 0.19% 0.26%
Ratio of quarterly Net Charge-off to Average Loans annualized -0.02% 0.01% 0.09% 0.17% 0.05%
Ratio of YTD Not Charge-offs to Average Loans, annualized 0.02% 0.05% 0.09% 0.13% 0.11
Earning Asset to Total Assets 92.43% 92.72% 93.00% 92.96% 93.21%
Earning Assets to Interest-Bearing Liabilities 119.98% 118.98% 121.63% 123.70% 121.09%
Capital Ratios:
Leverage 7.56% 7.58% 7.99% 7.95% 7.94%
Tier 1 Risk Based Capital 8.80% 9.48% 9.45% 10.12% 11.09%
Total Risk Based Capital 10.52% 11.41% 11.83% 13.01% 14.51%
Risk Weighted Assets $ 1,874,692 $ 1,640,736 $ 1,537,150 $ 1,360,078 $1,170,114
Book Value per Share $ 10.60 $ 10.24 $ 10.17 $ 9.72 $ 9.36
Total Shares Outstanding 11,325,572 11,247,791 11,135,923 11,011,482 10,985,955
</TABLE>
Note: Prior periods have been restated to reflect the mergers between Greater
Bay Bancorp and Bay Area Bancshares on a pooling-of-interest basis.
- --------------------------------------------------------------------------------
<PAGE>
GREATER BAY BANCORP
September 30, 1999 - FINANCIAL SUMMARY
($ in 000's, except share and per share data)
- --------------------------------------------------------------------------------
SELECTED QUARTERLY CONSOLIDATED OPERATING DATA:
<TABLE>
<CAPTION>
Third Second First Fourth Third
Quarter Quarter Quarter Quarter Quarter
1999 1999 1999 1998 1998
----------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Interest income $ 42,708 $ 39,043 $ 34,461 $ 33,152 $ 32,998
Interest Expense 17,612 16,161 13,921 13,475 13,947
----------- ------------ ------------ ------------ ------------
Net Interest Income Before
Provision for Loan Losses 25,096 22,862 20,540 19,677 19,051
Provision for Loan Losses 3,518 1,636 921 1,941 1,881
----------- ------------ ------------ ------------ ------------
Net Interest Income After
Provision for Loan Losses 21,578 21,226 19,619 17,736 17,170
Other Income:
Trust Fees 768 727 721 684 642
Depositor Service Fees 520 393 419 428 431
ATM Fees 615 501 527 498 510
Loan and International Banking Fees 747 458 309 176 165
Gain on Sale of SBA Loans 253 298 284 282 200
Gain/(loss) on Investments - - - 320 4
Other income (1) 1,170 410 293 421 129
----------- ------------ ------------ ------------ ------------
4,073 2,787 2,553 2,787 2,179
Nonrecurring - Warrant Income - 226 4 314 134
----------- ------------ ------------ ------------ ------------
Other Income 4,073 3,013 2,557 3,101 2,313
Operating Expenses:
Compensation and Benefits 7,060 7,726 7,169 6,537 6,587
Occupancy and Equipment 2,005 2,436 2,355 1,908 1,862
Professional Services & Legal 551 406 575 609 537
Client Services 280 244 261 142 128
FDIC Insurance and Assessments 138 103 100 92 93
Other Retail Estate, Net 30 15 21 (0) 43
Other Expenses 2,345 2,379 2,210 2,953 2,000
----------- ------------ ------------ ------------ ------------
Nonrecurring Expenses (2) 13,989 13,399 12,691 12,315 11,300
- 323 - 448 192
----------- ------------ ------------ ------------ ------------
Total Operating Expenses 13,989 13,722 12,691 12,763 11,522
----------- ------------ ------------ ------------ ------------
Net Income Before Income Taxes,
Merger and Other Related
Nonrecurring Costs and
Extraordinary Items 11,662 10,517 9,485 8,074 7,961
Income Tax Expenses 4,295 4,062 3,695 2,446 2,586
----------- ------------ ------------ ------------ ------------
Net Income Before Merger and Other
Related Nonrecurring Costs
and Extraordinary Items 7,367 6,455 5,790 5,628 5,375
Merger and Other Related
Nonrecurring
Costs, net of tax - 2,491 - - 360
----------- ------------ ------------ ------------ ------------
Net Income Before Extraordinary
Items 7,367 3,964 5,790 5,628 5,015
Extraordinary Items, net of tax (3) - - (88) - -
----------- ------------ ------------ ------------ ------------
Net Income $ 7,367 $ 3,964 $ 5,702 $ 5,628 $ 5,015
----------- ------------ ------------ ------------ ------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
SELECTED QUARTERLY CONSOLIDATED OPERATING RATIOS:
<CAPTION>
Third Second First Fourth Third
Quarter Quarter Quarter Quarter Quarter
1999 1999 1999 1998 1998
----------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Net Income Per Share (Before
Merger and Other Related
Nonrecurring Costs and
Extraordinary Items)
Basic $ 0.65 $ 0.50 $ 0.53 $ 0.51 $ 0.49
Diluted $ 0.62 $ 0.55 $ 0.50 $ 0.48 $ 0.46
Net Income Per Share
Basic $ 0.65 $ 0.35 $ 0.51 $ 0.51 $ 0.46
Diluted $ 0.52 $ 0.34 $ 0.40 $ 0.46 $ 0.43
Weighted Average Common Shares
Outstanding 11,285,000 11,193,000 11,087,000 10,994,000 10,924,000
Weighted Average Common & Common
Equivalent Shares Outstanding 11,911,000 11,798,000 11,718,000 11,705,000 11,622,000
Return on Quarterly Average Assets,
annualized (4) 1.34% 1.26% 1.29% 1.29% 1.30%
Return on Quarterly Average Equity,
annualized (4) 24.50% 21.99% 21.25% 21.32% 21.34%
Net Interest Margin - Average Earning
Assets 4.90% 4.80% 4.97% 4.90% 4.90%
Operating Expense Ration (Before
Nonrecurring and Extraordinary
Items) 2.54% 2.62% 2.83% 2.82% 2.75%
Efficiency Ratio (Before Nonrecurring
and Extraordinary Items) 47.96% 52.24% 54.95% 54.82% 53.37%
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
(1) Q3 of 1998 includes a $100,000 write-down of an equity investment in
accordance with APB 18 and Q3 1999 includes a $900,000 gain on an equity
investment.
(2) Q3 and Q4 of 1998 and Q2 of 1999 nonrecurring expenses are comprised of
$192,000, $446,000 and $323,000 in donations to the GBB Foundation,
respectively,
(3) Includes $88,000 loss on early retirement of subordinated debt.
(4) Before Merger and Other Related Nonrecurring Costs and Extraordinary Items
of $2.5 million, net of tax, in Q2 1999, $00,000, net of tax, in Q1 1999
and $360,000, net of tax, in Q3 of 1998,
Note: Prior periods have been restated to reflect the mergers between Greater
Bay Bancorp and Bay Area Bancshares on a pooling-of-interests basis.
- --------------------------------------------------------------------------------
<PAGE>
GREATER BAY BANCORP
September 30, 1999 - FINANCIAL SUMMARY
($ in 000's, expect share and per share data)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SELECTED YEAR TO DATE CONSOLIDATED OPERATING DATA:
September 30, September 30,
1999 1998
------------- -------------
<S> <C> <C>
Interest Income $ 116,212 $ 91,646
Interest Expense 47,714 37,705
------------- -------------
Net Interest Income Before Provision for Loan Losses 68,498 53,941
Provision for Loan Losses 6,075 4,294
------------- -------------
Net Interest Income After Provision for Loan Losses 62,423 49,647
Other Income (1) 9,413 6,122
Nonrecurring - Warrant Income 230 497
------------- -------------
Total Other Income 9,643 6,619
Operating Expenses 40,079 33,609
Other Expenses - nonrecurring (2) 323 701
------------- -------------
Total Operating Expenses 40,402 34,210
------------- -------------
Net Income Before Income Taxes, Merger and Other Related Nonrecurring Costs and Extraordinary items 31,661 22,056
Income Tax Expense 12,052 7,427
------------- -------------
Net Income Before Merger and Other Related Nonrecurring Costs and Extraordinary Items 19,012 14,620
Merger and Other Related Nonrecurring Costs, net of tax 2,491 1,314
------------- -------------
Net Income Before Extraordinary Items 17,121 13,315
Extraordinary Items (3) (88) -
------------- -------------
Net Income $ 17,033 $ 13,315
============= =============
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
SELECTED YEAR TO DATE CONSOLIDATED OPERATING RATIOS:
<CAPTION>
September 30, September 30,
1999 1998
------------- -------------
<S> <C> <C>
Net Income Per Share (Before Merger and Other Related Nonrecurring Costs and Extraordinary Items)
Basic $ 1.75 $ 1.35
Diluted $ 1.66 $ 1.20
Net Income Per Share
Basic $ 1.52 $ 1.23
Diluted $ 1.44 $ 1.14
Weighted Average Common Shares Outstanding 11,189,000 10,848,000
Weighted Average Common & Common Equivalent Shares Outstanding 11,810,000 11,649,000
Return on Average Assets, annualized (4) 1.30% 1.19%
Return on Average Equity, annualized (4) 22.63% 16.55%
Net Interest Margin - Average Earning Assets 4.88% 6.13%
Operating Expense Ratio (Before Nonrecurring and Extraordinary Items) 2.65% 2.72%
Efficiency Ratio (Before Nonrecurring and Extraordinary Items) 51.44% 55.79%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
(1) 1998 includes a $700,000 write-down of an equity investment in accordance
with APB 18 and 1999 includes a $900,000 gain on an equity investment.
(2) 1998 and 1999 nonrecurring expenses are comprised of a $701,000 and $323,000
donation to the GBB Foundation, respectively.
(3) Includes $88,000 loss on early retirement of subordinated debt.
(4) Before Merger and Other Related Nonrecurring Costs and Extraordinary Items
of $2.6 million, net of tax in 1999 and $1.3 million, net of tax, in 1998.
Note: Prior periods have been restated to reflect the mergers between Greater
Bay Bancorp and Bay Area Bancshares on a pooling-of-interests basis.
- --------------------------------------------------------------------------------
