First Reliance Announces 3rd Quarter Net Income of $490,423 — Up 13%
FLORENCE, S.C., Oct. 26 /PRNewswire-FirstCall/ — First Reliance Bancshares, Inc., (OTC Bulletin Board: FSRL), the holding company for First Reliance Bank, reported net income for the third quarter of $490,428, an increase of $55,118 or 13%, over the $435,310 reported for the quarter ended September 30, 2004. Earnings benefited from strong growth in both net interest income and non-interest income. Specifically, net interest income increased 58% to $3.9 million in the third quarter of 2005, while non-interest income increased by 40% to $926,281. Basic earnings per share were $0.15, a decrease of $0.02 from the $0.17 reported in the prior-year period. The earnings per share for the quarter ended September 30, 2005 is based on average shares of 3,280,182 compared to 2,501,237 shares reported in the prior-year period. The additional shares are primarily the result of a successful stock offering completed in December 2004 and options exercised in 2005. The offering provided $8 million of new capital and increased the number of shares by 700,000.
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Net Income for the nine months ended September 30, 2005 was $1.3 million, an increase of $303,749, or 30% from the level reported in the prior year nine-month period. As was the case with the quarterly results, the higher profitability was driven primarily by higher net interest income, which increased 62%, and non-interest income, which increased 29%. Basic earnings per share were $0.40 for the nine months ended September 30, 2005 and 2004.
At September 30, 2005, total assets were $383.9 million, an increase of $127.9 million, or 50% over the $256.0 million reported for September 30, 2004. Loans increased $ 99.2 million, or 48% to $306.5 million, funded primarily by growth in deposits. Deposits increased to $312.4 million, up 50% from $209.0 million reported the prior year period.
“We are extremely pleased to report exceptional growth and profitability for the 3rd quarter,” said Jeff Paolucci, SVP & CFO. “In addition to our financial performance, the 3rd quarter reflects improved asset quality, increased loan and deposit account growth, and the opening of our 5th branch, in Mt. Pleasant, SC. We focused intensely on core deposit growth in 2005 and are extremely pleased that core deposit growth has outpaced loan growth from the same period one year ago. We credit this growth to several new initiatives, such as 8-8 Banking, Coin Machines for customers and non- customers alike, a ‘5-Way Service Promise’ for mortgage loans, refunds for foreign bank ATM surcharges, our 24 hour ‘On Call Banker’, and enhancements to our Customer Care Center. First Reliance Bank is determined to make the banking atmosphere more appealing to our customers with every initiative measured against our ‘Easy-to-do-business-with’ standard.”
In a recent customer service survey First Reliance Bank received a satisfaction rating of over 96 percent. Totally Free Checking, along with a simple set of other feature rich products, has allowed our Low Cost/No Cost goals to be exceeded again. Customers can contact the Customer Care Center (ACCESSLive) 8-8 Monday through Friday or they can call the ACCESSBanker on Call 24 hours a day and speak directly to a live banker for any urgent need.
“First Reliance Bank continues to aggressively focus on the future by building solid infrastructure to support a much larger banking network,” said Rick Saunders, President & CEO. “We plan for constant profitable growth and expansion into two new markets within the next two years. First Reliance Bank’s vision of being the ‘largest and most profitable bank in South Carolina’ guides its decision making process by only implementing programs that can be measured in terms of directly benefiting customers.
“We are not satisfied and will not rest until we become the bank of choice in every market we serve,” said Saunders. “Our growth is outpaced only by our sincere desire to provide premium products, premium service using the best bankers in the best locations.”
Based in Florence, South Carolina, First Reliance Bancshares, Inc., is a bank holding company with approximately $383.9 million in assets as of September 30, 2005. First Reliance Bank, which was opened in 1999, is the Company’s sole operating subsidiary. The bank, which serves as one of the only locally owned and operated banks in the Florence area, maintains two branch locations and a Technology Center in Florence, SC. In addition, the bank’s aggressive planned growth strategy resulted in expansion into the Columbia, SC market where they opened a Lexington regional facility in 2004. In March of 2005, the Charleston regional office was opened in historic downtown Charleston, SC. Their newest facility opened in the 3rd quarter of 2005, and serves the Mt. Pleasant, SC community. First Reliance Bank focuses heavily on personal customer service and offers a full range of financial services. Personal products include checking and savings accounts, money market accounts, CDs and IRAs, and personal mortgage loans, while business products include checking and savings accounts, commercial lending services, and money market accounts. In September 2004, First Reliance Bank began offering Wholesale Mortgage Services and Title Insurance Services. In December of 2004, the company began offering business customers a courier service. In addition, First Reliance Bank also provides Internet banking, electronic bill paying services, free coin counter use for customers and non-customers, and overdraft privilege to its customers. The Company’s stock is traded on the OTC Bulletin Board under the symbol “FSRL”. Information about the Company is available on our website at www.firstreliance.com.
This press release contains forward-looking statements about branch openings within the meaning of the Securities Litigation Reform Act of 1995. Forward-looking statements give our expectations or forecasts of future events.
Any or all of our forward-looking statements here or in other publications may turn out to be incorrect. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining our actual future results. Consequently, no forward- looking statements can be guaranteed. Our actual results may vary materially, and there are no guarantees about the performance of our stock.
We undertake no obligation to correct or update any forward-looking statements, whether as a result of new information, future results or otherwise. You are advised, however, to consult any future disclosures we make on related subjects in our reports to the SEC.
Contact Jeffrey A. Paolucci, Senior Vice President and Chief Financial
Officer, (843) 674-3250
First Reliance Bancshares, Inc.
Consolidated Reports of Income
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
Sept Sept Sept Sept
30, 2005 30, 2004 30, 2005 30, 2004
(Unaudited) (Unaudited)(Unaudited)(Unaudited)
Interest Income
Loans and Fees 5,712,770 3,273,844 15,247,645 8,322,963
Taxable Securities 178,495 197,377 529,973 537,239
Nontaxable Securities 147,302 94,869 400,923 297,062
Nonmarketable Securities 23,917 9,582 56,666 26,310
Federal Funds Sold and Other 166,403 285 246,954 2,313
Other Interest Income 470 - 470 -
Total 6,229,357 3,575,957 16,482,631 9,185,887
Interest Expense
Deposits 2,091,780 999,588 5,259,338 2,379,843
FHLB Advances 243,305 121,241 770,976 360,924
Federal Funds Purchased and
Repurchase Agreements 24,366 5,059 63,073 13,064
Total 2,359,451 1,125,888 6,093,387 2,753,831
Net Interest Income 3,869,906 2,450,069 10,389,244 6,432,056
Provision for loan losses (450,393) (368,500) (1,016,545) (846,762)
Net Interest Income after
provision 3,419,513 2,081,569 9,372,699 5,585,294
Noninterest Income
Residential mortgage
origination fees 402,628 164,385 847,248 407,008
Service charges on
deposit accounts 345,961 337,912 1,020,408 895,291
Brokerage fees 52,398 21,561 122,294 103,728
Gain on sale of securities
available for sale - 1,105 - 3,808
Gain (loss) on Sale
of Other Real Estate (3,474) 5,447 (66,815) 5,447
Gain (loss) on Sale
of Fixed Assets - - (287) -
Credit life insurance
commissions 7,321 16,879 22,598 66,723
Other charges, commissions
and fees 121,447 115,938 367,244 305,512
Total 926,281 663,227 2,312,690 1,787,517
Noninterest Expense
Salaries and employee
benefits 1,908,637 1,253,052 5,486,807 3,486,375
Occupancy expense 260,767 109,422 642,838 276,838
Furniture and equipment
expense 163,398 145,146 523,862 446,168
Other operating expenses 1,316,239 612,568 3,188,548 1,736,941
Total 3,649,041 2,120,188 9,842,055 5,946,322
Income before tax 696,753 624,608 1,843,334 1,426,489
Income tax expense 206,325 189,298 537,904 424,808
Net Income 490,428 435,310 1,305,430 1,001,681
Basic earnings per share 0.15 0.17 0.40 0.40
Diluted earnings per share 0.14 0.16 0.38 0.37
First Reliance Bancshares, Inc.
Balance Sheet
Sept 30December 31Sept 30
2005 2004 2004
(Unaudited) Audited (Unaudited)
Assets:
Cash and Cash Equivalents
Cash and Due Froms 7,424,120 3,803,535 4,078,010
Federal funds sold 18,057,000 1,042,000 2,620,000
Total cash and
cash equivalents 25,481,120 4,845,535 6,698,010
Investment securities
Securities available for sale 32,183,744 28,567,666 28,955,920
Nonmarketable equity securities 1,925,850 1,714,700 1,115,725
Total investment securities 34,109,594 30,282,366 30,071,645
Loans held for sale 5,734,851 1,332,890 1,742,151
Loans receivable 306,521,358 238,362,092 207,350,839
Less allowance for loan losses (3,372,891) (2,758,225) (2,456,655)
Loans, net 303,148,467 235,603,867 204,894,184
Premises, furniture, and
equipment, net 7,540,764 5,891,402 5,900,265
Accrued interest receivable 1,798,507 1,458,673 1,222,019
Other real estate owned 340,350 320,598 673,258
Other assets 5,702,593 5,235,552 4,781,271
Total Assets 383,856,246 284,970,883 255,982,803
Liabilities:
Deposits:
Noninterest bearing transaction
accounts 37,647,945 27,560,581 25,657,889
Interest bearing transaction
accounts 22,786,963 15,525,590 16,438,391
Savings 78,137,005 46,299,198 39,915,189
Time deposits $100,000 and over 108,682,388 93,975,912 84,332,588
Other time deposits 65,157,162 42,132,546 42,619,224
Total deposits 312,411,463 225,493,827 208,963,281
Securities sold under agreements
to repurchase 3,375,260 3,061,903 2,929,998
Federal funds purchased - -
Advances from Federal Home Loan
Bank 27,500,000 27,900,000 20,000,000
Junior Subordinated Debentures 10,000,000 - -
Accrued interest payable 461,804 742,017 606,431
Other liabilities 1,088,300 414,487 1,014,687
Total Liabilities 354,836,827 257,612,234 233,514,397
Shareholders' Equity:
Common Stock 32,819 32,039 27,984
Capital Surplus 23,934,041 23,428,034 18,785,525
Treasury Stock (9,896) (7,396) -
Retained Earnings 4,969,731 3,664,301 3,327,283
Accumulated other comprehensive
income 92,724 241,671 327,884
Total Equity 29,019,419 27,358,649 22,468,676
Total Liabilities and Shareholders
Equity 383,856,246 284,970,883 255,983,073
SOURCE First Reliance Bancshares, Inc.
-0- 10/26/2005
/CONTACT: Jeffrey A. Paolucci, Senior Vice President and Chief Financial
Officer of First Reliance Bank, +1-843-674-3250, or
jpaolucci@firstreliance.com /
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/Web site: http://www.firstreliance.com/
(FSRL)
CO: First Reliance Bancshares, Inc.; First Reliance Bank
ST: South Carolina
IN: FIN OTC
SU: ERN
DL-JK
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5200 10/26/200507:00 EDThttp://www.prnewswire.com
