Pre-Tax Income Up 35.0% for the Quarter and 72.5% Year to Date
BERNARDSVILLE, N.J., July 25 /PRNewswire-FirstCall/ -- Somerset
Hills Bancorp (NASDAQ:SOMH) reported record net income for the
second quarter and year to date 2006. For the quarter ended June
30, 2006, net income increased by $140,000 to $485,000, or $0.11
per diluted share, up 22.2 percent from net income of $0.09 per
diluted share achieved during the second quarter of 2005. The
Company's return on average equity was 7.21 percent and return on
average assets was .79 percent for the second quarter of 2006. The
net interest margin was 4.32 percent for the second quarter of
2006. For the second quarter of 2005, the Company's return on
average equity was 5.85 percent, return on average assets was .69
percent and net interest margin was 4.31 percent. For the six
months ended June 30, 2006, net income increased by $353,000 to
$960,000, or $0.23 per diluted share, up 53.3 percent from net
income of $0.15 per diluted share earned for the six months ended
June 30, 2005. The Company's return on average equity was 7.32
percent, return on average assets was .80 percent and the net
interest margin was 4.28 percent for the six months ended June 30,
2006. For the six months ended June 30, 2005, the Company's return
on average equity was 5.22 percent, return on average assets was
.63 percent and net interest margin was 4.26 percent. Stewart E.
McClure, Jr., President and Chief Executive Office said, "We are
especially pleased with our increase of 58.2 percent in net income
over the previous six month period as well as our growth in loans
of 27.1 percent and our growth in deposits of 21.8 percent. We are
in an extremely competitive market and to achieve this kind of
growth speaks well of our staff and our product offerings. We hope
to continue our growth through the expansion of our branch network.
We will open our Madison office in the third quarter of 2006. We
anticipate that our Long Valley Branch will open in the first
quarter of 2007 followed by our Stirling Office, which we hope to
open in the third quarter of 2007. We are also particularly pleased
with our growth in income given the continued weakness in our
mortgage operations which is somewhat consistent with the mortgage
industry as a whole." At June 30, 2006, loans increased $37.8
million, or 27.1 percent, to $177.4 million from $139.6 at June 30,
2005. At June 30, 2006, deposits increased $39.2 million, or 21.8
percent, to $219.0 million from $179.8 million at June 30, 2005. At
June 30, 2006, total assets were $257.6 million, up from $207.4
million at June 30, 2005, a 24.2 percent increase. Somerset Hills
Bancorp is a bank holding company formed in January 2001 which owns
all of the common stock of Somerset Hills Bank, a full service
commercial bank with offices in Bernardsville, Mendham, Morristown,
and Summit, New Jersey. It has announced plans to open three
additional offices in Madison, Stirling, and Long Valley. Somerset
Hills Bank focuses its lending activities on small to medium sized
businesses, high net worth individuals, professional practices, and
consumer and retail customers. The Bank operates a licensed
mortgage company subsidiary, Sullivan Financial Services, Inc. and
also operates Somerset Hills Wealth Management Services, LLC, a
wholly owned subsidiary licensed to provide financial services,
including financial planning, insurance (life, health, property and
casualty), mutual funds and annuities for individuals and
commercial accounts, and Somerset Hills Title Group, LLC, which,
with its partner, Property title Group, provides title services in
connection with the closing of real estate transactions. The common
stock of the Company is traded on NASDAQ under the symbol SOMH and
the Company's warrants are traded under the symbol SOMHW. You can
visit our website at http://www.somersethillsbank.com/.
Forward-Looking Statements This news release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Those statements are
subject to known and unknown risk, uncertainties and other factors
that could cause the actual results to differ materially from those
contemplated by the statements. We based the forward-looking
statements on various factors and using numerous assumptions.
Important factors that may cause actual results to differ from
those contemplated by forward-looking statements include, for
example, the success or failure of our efforts to implement our
business strategy, the effect of changing economic conditions and,
in particular, changes in interest rates, changes in government
regulations, tax rates and similar matters, our ability to attract
and retain quality employees, and other risks which may be
described in our future filings with SEC. Somerset Hills Bancorp
Selected Consolidated Financial Data (Unaudited) ($ in thousands
except per share data) Six Months Ended June 30 2006 2005 Income
Statement Data: Interest income $7,378 $5,025 Interest expense
2,614 1,282 Net interest income 4,764 3,743 Provision for loan
losses 126 57 Net interest income after prov. for loan losses 4,638
3,686 Non-interest income 1,184 1,281 Non-interest expense 4,337
4,106 Income before income taxes 1,485 861 Income tax expense 525
254 Net income $960 $607 Balance Sheet Data: Total assets $257,573
$207,428 Loans, net 177,441 139,611 Loans held for sale 15,507
13,535 Allowance for loan losses 2,095 1,691 Investment securities
held to maturity 10,205 7,188 Investment securities held for sale
29,522 26,074 Deposits 218,957 179,788 Borrowings 10,500 3,000
Shareholders' equity 27,053 23,751 Performance Ratios: Return on
average assets 0.80% 0.63% Return on average equity 7.32% 5.22% Net
interest margin 4.28% 4.26% Efficiency ratio 72.9% 81.7% Asset
Quality: Nonaccrual loans 0 48 OREO property 0 0 Net charge-offs
(recoveries) 2 0 Allowance for loan losses to total loans 1.17%
1.20% Nonperforming loans to total loans 0 0.03% Per Share Data:
Earnings per share - Basic $0.27 $0.18 Earnings per share - Diluted
$0.23 $0.15 Book value per share $7.48 $7.38 Tangible book value
$7.15 $7.01 Somerset Hills Bancorp Statements of Operations (in
thousands, except for share data) Three Three Six Six months months
months months ended ended ended ended June 30, June 30, June 30,
June 30, 2006 2005 2006 2005 (unaudited) (unaudited) (unaudited)
(unaudited) Interest Income: Loans, including fees $3,349 $2,350
$6,422 $4,445 Investment securities 458 273 917 467 Federal funds
sold 13 51 23 99 Interest bearing deposits with other banks 8 9 16
14 Total interest income 3,828 2,683 7,378 5,025 Interest Expense:
Deposits 1,344 685 2,473 1,250 Federal Home Loan Bank advances 44
20 140 32 Federal funds purchased - - 1 - Total interest expense
1,388 705 2,614 1,282 Net Interest Income 2,440 1,978 4,764 3,743
Provision for loan losses 50 57 126 57 Net Interest Income After
Provision for Loan Losses 2,390 1,921 4,638 3,686 Non-Interest
Income: Service fees on deposit accounts 75 67 150 136 Gains on
sales of mortgage loans, net 354 524 819 944 Other Income 99 109
215 201 Total Non-Interest Income 528 700 1,184 1,281 Non-Interest
Expenses: Salaries and employee benefits 1,210 1,003 2,356 2,004
Occupancy expense 398 350 788 714 Advertising and business
promotion 131 159 301 280 Stationery and supplies 45 71 104 128
Data processing 104 99 206 181 Other operating expense 290 391 582
799 Total Non-Interest Expense 2,178 2,073 4,337 4,106 Income
before provision for income taxes 740 548 1,485 861 Provision for
Income Taxes 255 203 525 254 Net Income $485 $345 $960 $607 Per
share data Net Income - basic $0.14 $0.10 $0.27 $0.18 Net Income -
diluted $0.11 $0.09 $0.23 $0.15 * Restated to reflect 5% stock
dividends in 2006 and 2005 Somerset Hills Bancorp Balance Sheets
(in thousands, except for share data) June 30, 2006 Dec. 31, 2005
(unaudited) ASSETS Cash and due from banks $10,359 $10,321 Total
cash and cash equivalents 10,359 10,321 Loans held for sale, net
15,507 15,380 Investment securities held to maturity (Approximate
market value of $10,058 in 2006 and $9,372 in 2005) 10,205 9,366
Investment securities available-for-sale 29,522 31,899 Loans
receivable 179,679 167,301 Less: allowance for loan losses (2,095)
(2,029) Deferred fees (143) (154) Net loans receivable 177,441
165,118 Premises and equipment, net 5,173 4,679 Goodwill, Net 1,191
1,191 Bank owned life insurance 5,628 5,533 Accrued interest
receivable 1,206 1,135 Deferred tax asset 830 889 Other assets 511
415 TOTAL ASSETS $257,573 $245,926 LIABILITIES AND STOCKHOLDERS'
EQUITY LIABILITIES Deposits Non-interest bearing deposits-demand
$43,972 $45,667 Interest bearing deposits NOW, money market and
savings 149,329 141,846 Certificates of deposit, under $100,000
14,789 14,034 Certificates of deposit, $100,000 and over 10,867
6,697 Total deposits 218,957 208,244 Federal Home Loan Bank
advances 10,500 10,600 Accrued interest payable 471 252 Taxes
payable - 760 Other liabilities 592 765 Total liabilities 230,520
220,621 STOCKHOLDERS' EQUITY Preferred stock-1,000,000 shares
authorized: none issued - - Common stock-authorized, 9,000,000
shares of no par value; issued and outstanding, 3,621,922 in 2006
and 3,426,289 in 2005 25,908 24,389 Retained earnings 2,015 1,223
Accumulated other comprehensive loss (870) (307) Total
Stockholders' Equity 27,053 25,305 TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $257,573 $245,926 * Restated to reflect 5%
stock dividends in 2006 and 2005 DATASOURCE: Somerset Hills Bancorp
CONTACT: Stewart E. McClure, Jr., President and Chief Executive
Officer, +1-908-630-5000, or Gerard Riker, EVP and Chief Financial
Officer, +1-908-630-5018, both of Somerset Hills Bancorp Web site:
http://www.somersethillsbank.com/
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