Northway Financial, Inc. Announces Fourth Quarter Results and
Declares Quarterly Dividend BERLIN, N.H., Jan. 25
/PRNewswire-FirstCall/ -- Northway Financial, Inc. (the "Company")
(NASDAQ:NWFI) reported net income for the quarter ended December
31, 2004 of $934,000, or $0.62 per share, compared to $1,004,000,
or $0.66 per share, for the same quarter in 2003. Net income for
the year ended December 31, 2004 was $3,388,000, or $2.26 per
share, compared to $3,617,000, or $2.40 per share, for the year
ended December 31, 2003, a decrease of $229,000. William J.
Woodward, President and Chief Executive Officer commented, "In the
fourth quarter we saw a more favorable interest rate environment,
which resulted in improved net interest income for the quarter
compared to last year. Noninterest income, excluding securities
gains, increased from last year, both for the quarter and the full
year. This reflects, in part, the impact of the new non-deposit
product line introduced earlier in 2004, in addition to our
continuing efforts to maximize all components of noninterest
income. Less favorable market conditions for investment securities
resulted in lower securities gains in the fourth quarter and for
the full year than in 2003. Throughout 2004, management has taken
positive steps to reduce overhead expense. The result of these
initiatives is reflected in the fourth quarter overhead being lower
than in the same quarter last year. The emphasis on overhead
control continues." The Company declared a quarterly dividend on
January 25, 2005 of $0.17 per share payable February 9, 2005 to
shareholders of record on February 4, 2005. Net interest and
dividend income for the fourth quarter of 2004 was $5,876,000
compared to $5,636,000 for the fourth quarter of 2003, an increase
of $240,000. The provision for loan losses for the fourth quarter
of 2004 decreased $45,000 to $105,000, compared to $150,000 for the
fourth quarter of the previous year. Net securities gains for the
quarter decreased $658,000 to $13,000, compared to $671,000 for the
same period last year. Other noninterest income for the quarter
increased $138,000 to $1,081,000 compared to $943,000 for the same
period last year. Other operating expense was $5,517,000 for the
quarter, compared to $5,718,000 for the same period last year, a
decrease of $201,000. Net interest income for the year ended
December 31, 2004 decreased $204,000 to $22,846,000, compared to
$23,050,000 for the same period last year. The provision for loan
losses for the year ended December 31, 2004 decreased $310,000 to
$495,000, compared to $805,000 for the same period a year ago. At
December 31, 2004 the allowance for loan losses was 1.09% of total
loans, compared to 1.08% at December 31, 2003. Securities gains for
the year ended December 31, 2004 decreased $769,000 to $753,000,
compared to $1,522,000 for the same period last year. Other
noninterest income year-to- date increased $491,000 to $4,344,000,
compared to $3,853,000 for the same period last year. There was no
write-down of equity securities for the year ended December 31,
2004 compared to a write-down of $184,000 for the same period last
year. Other operating expense increased $442,000 to $22,394,000 for
the year ended December 31, 2004, compared to $21,952,000 for the
same period last year. At December 31, 2004, Northway Financial had
total assets of $638,418,000 compared to $609,216,000 at December
31, 2003, an increase of $29,202,000. Loans, including loans
held-for-sale, increased $719,000 from $469,094,000 at December 31,
2003 to $469,813,000 at December 31, 2004. Investments, including
federal funds sold, increased $28,366,000 from $89,622,000 at
December 31, 2003 to $117,988,000 at December 31, 2004. Total
deposits were $475,359,000 at December 31, 2004, an increase of
$12,052,000 compared to $463,307,000 at December 31, 2003. Total
borrowings increased $14,867,000 from $95,021,000 at December 31,
2003 to $109,888,000. Total equity increased $1,638,000 from
$47,872,000 at December 31, 2004 to $49,510,000 at December 31,
2004. Northway Financial, Inc., headquartered in Berlin, New
Hampshire, is a multi-bank holding company. Through its subsidiary
banks, The Berlin City Bank and The Pemigewasset National Bank of
Plymouth, New Hampshire, the Company offers a broad range of
financial products and services to individuals, businesses and the
public sector from its full service banking offices. Certain
statements in this press release are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements can be identified by the
use of the words "expect," "believe," "estimate," "will" and other
expressions which predict or indicate future trends and which do
not relate to historical matters. Forward-looking statements may
include, but are not limited to, expectations regarding the impact
on net income of withdrawing from the indirect automobile lending
line of business, expectations for impact of new products on
noninterest income and expense, projections of revenue, income or
loss, and plans related to products or services of the Company and
its subsidiaries. Such forward-looking statements are subject to
known and unknown risks, uncertainties and contingencies, many of
which are beyond the control of the Company. The Company's actual
results could differ materially from those projected in the
forward-looking statements as the result of, among other factors,
changes in interest rates, changes in the securities or financial
markets, a deterioration in general economic conditions on a
national basis or in the local markets in which the Company
operates, including changes in local business conditions resulting
in rising unemployment and other circumstances which adversely
affect borrowers' ability to service and repay our loans, changes
in loan defaults and charge-off rates, reduction in deposit levels
necessitating increased borrowing to fund loans and investments,
the passing of adverse government regulation, and changes in
assumptions used in making such forward-looking statements. These
forward-looking statements were based on information, plans and
estimates at the date of this press release, and the Company does
not promise to update any forward-looking statements to reflect
changes in underlying assumptions or factors, new information,
future events or other changes. Northway Financial, Inc. Selected
Consolidated Financial Data (Unaudited) (In thousands, except for
ratios and per share amounts) Period end balance sheet data:
December 31, 2004 2003 Total assets $638,418 $609,216 Loans, net
(1) 469,813 469,094 Investments (2) 117,988 89,622 Deposits 475,359
463,307 Borrowings 109,888 95,021 Stockholders' equity 49,510
47,872 Book value per share $32.93 $31.92 Tangible book value per
share (3) 24.02 22.30 Leverage ratio 8.43% 8.02% Shares outstanding
1,503,574 1,499,574 For the Three Months For the Twelve Months
Ended Dec. 31, Ended Dec. 31, Operating results: 2004 2003 2004
2003 Net interest income $5,876 $5,636 $22,846 $23,050 Securities
gains, net 13 671 753 1,522 Other noninterest income 1,081 943
4,344 3,853 Loan loss provision 105 150 495 805 Write-down of
equity securities - - - 184 Other operating expense 5,517 5,718
22,394 21,952 Income before tax 1,348 1,382 5,054 5,484 Income tax
expense 414 378 1,666 1,867 Net income $934 $1,004 $3,388 $3,617
Earnings per share $0.62 $0.66 $2.26 $2.40 Return on average assets
0.58 % 0.64 % 0.54 % 0.59 % 0.87 % Return on average equity 7.47 %
8.40 % 6.97 % 7.82 % (1) Net of unearned income and the allowance
for loan losses. Includes loans held-for-sale. (2) Includes federal
funds sold, Federal Home Loan Bank stock, Federal Reserve Bank
stock and investment securities available-for-sale. (3) Includes a
deduction of $13,400 and $14,439 for goodwill, core deposit
intangible and mortgage servicing assets for 2004 and 2003,
respectively. DATASOURCE: Northway Financial, Inc. CONTACT: Richard
P. Orsillo, Senior Vice President and Chief Financial Officer of
Northway Financial, Inc., +1-603-752-1171
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