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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: July 29, 1997
REDWOOD EMPIRE BANCORP
(Exact number of Registrant as specified in its charter)
California File No. 0-19231 68-0166366
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(State or other jurisdiction (Commission File Number) (IRS Employer)
of Incorporated or organization) Identification No.)
111 Santa Rosa Avenue, Santa Rosa, California 95404-4905
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (707) 545-9611
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ITEM 5. OTHER EVENTS
Press release for the following (article attached):
Redwood Empire Bancorp reports second quarter 1997 financial results.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
7-29-97
Date: ___________________ REDWOOD EMPIRE BANCORP
(Registrant)
/s/ James E. Beckwith
By: ___________________________
James E. Beckwith
Executive Vice President and
Chief Financial Officer<PAGE>
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FOR: REDWOOD EMPIRE BANCORP
APPROVED BY: James Beckwith
Chief Financial Officer
(707) 522-5215
CONTACT: Morgen-Walke Associates, Inc.
John Swenson, Doug Sherk
(415) 296-7383
FOR IMMEDIATE RELEASE Joshua Passman
- --------------------- (212) 850-5600
REDWOOD EMPIRE BANCORP REPORTS STRONG SECOND QUARTER RESULTS
SANTA ROSA, Calif. (July 29, 1997) -- Redwood Empire Bancorp (AMEX: REB)
today reported significantly improved net income of $884,000, or $0.26 per
share fully diluted, for its second quarter ended June 30, 1997. This
compares with net income of $38,000, or a fully diluted loss per share of
($0.03), for the second quarter a year ago, and net income of $580,000 or
$0.16 per share fully diluted, for the first quarter of 1997. Return on
equity was 11.74% in the second quarter, compared with .47% in the same
quarter a year ago and 7.74% for the first quarter of 1997.
For the six months, net income was $1,464,000, or $0.43 per share on a
fully-diluted basis. This compares with net income of $924,000, or $0.26 per
share fully diluted, for the first six months of 1996.
"With the consolidation of Allied now behind us, we are pleased to once
again report a strong quarterly profit," said Tom Whitaker, Chairman of
Redwood Empire Bancorp.
Consolidated net interest income decreased 12.3% in the second quarter,
compared to the same period in 1996. The decrease is due to a decline of
$94.4 million in average held for sale mortgage loans outstanding. However,
the net interest margin increased 54 basis points to 5.37% in the recent
second quarter, compared to 4.83% in the second quarter of 1996.
The loan loss provision was $585,000 for the quarter, versus $1,315,000
in the same period last year. Net chargeoffs were $122,000, or .03% of
average portfolio loans. Nonperforming assets at June 30, 1997 were
$15,690,000 or 3.54% of total assets, as compared to non-performing assets of
$13,181,000, or 2.64% of total assets, as of December 31, 1996, and
$15,570,000 or 3.38% of total assets as of March 31, 1997.
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The increase over 1996 year-end non-performing assets primarily relates
to an increase in non accrual loans, an increase in restructured loans and an
increase in other real estate owned. Non accrual loans increased $639,000,
mainly as a result of repurchased mortgage loans. Restructured loans
increased by $518,000, principally related to one large commercial loan.
Other real estate owned increased $1,352,000 in the first six months of 1997,
due to foreclosure of several related real property construction and
development loans and several other single-family home loans.
"Our new Chief Credit Officer, Deborah Kaufman, has created a credit
culture whose aim is to improve and grow the Company's loan portfolio", said
Mr. Whitaker.
Due to the effect of the restructuring in the fourth quarter of 1996,
second quarter non interest expenses declined $3,513,000, or 38.7% from the
same quarter one year ago. Non-interest income of $2,335,000 represented a
decline of $2,076,000 from the same quarter one year ago.
Whitaker added, "Due to personnel turnover, the Company's sub prime
mortgage lending unit, Allied Diversified Credit, a division of National Bank
of the Redwoods, saw mortgage loan originations decline 36% in the second
quarter of 1997, when compared to the first quarter. Our second half
expectations for production within this business unit have been adjusted to
reflect staff tenure."
Total assets were $443 million at quarter-end. Common book value per
share was $9.18. Tier 1 capital to risk-based assets was approximately 9.01%
and total capital to risk-based assets was approximately 13.88% at June 30,
1997.
Redwood Empire Bancorp is the holding company for National Bank of the
Redwoods, a commercial bank. The Company operates through branches and loan
production offices in various northern California locations.
The statements contained in this release which are not historical facts
are forward-looking statements that are subject to risks and uncertainties
that could cause actual results to differ materially from those set forth in
or implied by forward-looking statements. These risks are described in the
Company's Securities and Exchange Commission filings.
(Tables to follow)
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REDWOOD EMPIRE BANCORP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(DOLLARS IN THOUSANDS EXCEPT FOR EARNINGS PER SHARE AND SHARE DATA)
Three Months Ended Six Months Ended
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June 30 June 30 June 30 June 30
1997 1996 1997 1996
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Interest income $9,488 $11,839 $19,226 $23,332
Interest expense 4,157 5,757 8,806 11,751
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Net interest income 5,331 6,082 10,420 11,581
Provision for loan losses 585 1,315 1,170 2,830
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Net interest income after loan
loss provision 4,746 4,767 9,250 8,751
Other income 2,335 4,411 5,344 9,996
Other expense 5,554 9,067 12,067 17,158
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Income before taxes 1,527 111 2,527 1,589
Income tax expense 643 73 1,063 665
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NET INCOME 884 38 1,464 924
Preferred dividends 112 112 224 224
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Net income available for common $772 ($74) $1,240 $700
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Earnings per common and common equivalent share:
Primary:
Net income $.27 ($.03) $.43 $.26
Weighted average shares 2,887,000 2,713,000 2,871,000 2,731,000
Fully diluted:
Net income $.26 ($.03) $.43 $.26
Weighted average shares 3,386,000 2,713,000 3,373,000 2,731,000
SELECTED RATIOS
Return on Average Common Equity 12.34% (1.12%) 10.06% 5.30%
Return on Average Total Equity 11.49% .47% 9.63% 5.75%
Return on Average Assets .76% .03% .65% .34%
SELECTED BALANCE SHEET DATA
(IN THOUSANDS)
June 30 June 30
1997 1996
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Total Loans, including Mortgage Loans Held for Sale $331,839 $417,903
Allowance for Loan Loss 7,548 7,034
Total Assets 443,444 520,993
Total Deposits 388,898 443,020
Equity Capital 31,276 32,006
Nonperforming Assets 15,690 10,127
