Sierra Bancorp (BSRR) Q4 2003 earnings summary

Executive summary

• FY 2003 net income reached a record $10.4 million, up 17.3% YoY; diluted EPS was $1.03.

• Year-end assets exceeded $800 million for the first time, reaching $802 million; loans were $611 million and deposits $684 million.

• Return on average equity was 18.34%, among the strongest performances by California banks, according to the president's message.

Financial highlights

• Net interest income rose $2.7 million, or 8.3%, driven by 6.3% growth in average earning assets and a 7 bps increase in net interest margin.

• Non-interest income increased $1.9 million; deposit service charges rose $702,000, or 13.3%, and BOLI cash surrender value increased $759,000.

• Non-interest expense increased 7.8%; pre-tax income rose $2.8 million, or 23.7%, while income tax provision increased $1.3 million, or 42.3%.

• Total assets grew $100 million, or 14.3%, and gross loans and leases increased $97.2 million, primarily from real-estate-secured lending.

Outlook and guidance

• Management began developing a 2004–2008 five-year plan and expected strong financial performance to continue.

• The Clovis branch was expected to begin operations in Q2 2004; additional branches were in planning stages.

• Sierra Lease, launched in August 2003, was expected to contribute meaningfully to future results.