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CALNET BUSINESS BANK (CLNB.OB) REPORTS FINANCIAL RESULTS FOR THE PERIOD THROUGH DECEMBER 31, 2001
Today Calnet Business Bank (OTC BB:CLNB.OB - news) announced results for the period from Nov. 5, 2001 through Dec. 31, 2001.
Sacramento, Calif. -- Today Calnet Business Bank (OTC BB:CLNB.OB - news) announced results for the period from Nov. 5, 2001 through Dec. 31, 2001.
With the approval of the Office of the Comptroller of the Currency, Calnet opened for business on Nov. 5, 2001 with a business model based on combining the best of community banking with the latest in technological banking solutions.
We are the next step in banking," said Peter Raffetto, Calnet Business Bank president and CEO. Our goal is to build relationships with small to mid-sized businesses with services that create remarkable efficiencies to save them time and money. Essentially, customers have more control through real-time online cash management, unique card management and automation."
The banks public offering closed on Oct. 2, 2001. A total of 984,360 shares were subscribed for and raised $9.8 million less offering expenses of $352,000. The bank incurred pre-opening expenses of $1.1 million, which were all expensed prior to the opening of the bank. Net loss for the period from Nov. 5, 2001 through Dec. 31, 2001 was $413,000, or $0.42 per share. The loss from operations for the short period the bank was open was in line with managements expectations.
Net interest income for the period was $23,000, derived predominately from investment of the proceeds from the banks stock offering in federal funds sold. Most of the banks available funds were invested for the period in federal funds sold, which yielded only 1.6 percent.
To reward charter customers, the bank is waiving service charges on demand deposit accounts through April 30, 2002. As a result, non-interest income for the period of operations was nominal. Other expenses for the period were $413,000, including $234,000 in payroll expenses.
In light of low prevailing interest rates, Calnet focused significant attention on loan production and has recruited a strong lending staff. The bank has a significant number of loans in development. Loans funded by Dec. 31, 2001 were $1.9 million net of an allowance for loan losses of $24,000. As of Dec. 31, 2001 the bank had outstanding conditional commitments to make loans of $2.5 million.
Deposits at Dec. 31, 2001 were $8.6 million, including $984,000 in non-interest bearing demand deposits. Deposit rates have been set at or above rates established by the banks competitors to encourage potential clients to switch to the bank.
Expenditures on fixed assets, net of depreciation, for the period between Nov. 5, 2001 and Dec. 31, 2001 were $1.3 million. This included $866,000 for computer hardware and software. The investment in data processing hardware, software and personnel is part of the banks strategy to provide clients with up to date access to technology-based banking solutions. Computer hardware and software are being depreciated over 36 months. For the period ending Dec. 31, 2001, depreciation of total fixed assets was $47,000.
The bank's Tier I Capital at the end of the year was $8 million. The bank's leverage capital ratio was 68.3 percent. The FDIC requires the bank to maintain leverage capital in excess of 8 percent through the first three years of operations.
I am very pleased with our success so far in the Sacramento business community," Raffetto said. Customers have expressed strong support and are pleased with the high level of personal service they receive. Those with high transaction volumes are delighted with our technical capabilities that automate and integrate those transactions. Our customers see greater efficiency that saves them time and money. We look forward to implementing our business plan in the months ahead.''
Forward Looking Statement Disclosure
Statements made in this release may constitute Forward Looking Statements within the meaning of the Private Securities Litigation Reform Act of 1995 and any such statements are subject to risks and uncertainties that could cause actual results to differ materially. Such risks and uncertainties include those related to the economic environment, particularly in the region where Calnet Business Bank operates, competitive products and pricing, general interest rate changes and the fiscal and monetary policies of the U.S. Government, credit risk management, regulatory actions, and other risks and uncertainties.
About Calnet Business Bank
Calnet Business Bank was formed by a group of highly respected banking professionals and business leaders with the highest standards for personal, high-quality customer service and advanced technology. They built the banks infrastructure from the ground up with new technology that allows customers to integrate their financial systems with the bank for complete access and control over their accounts. We are the next step in banking. Powered by technology. Delivered by professionals. For more information please call 916.927.7000 or visit www.calnetbank.com.
CALNET BUSINESS BANK FINANCIAL HIGHLIGHTS
(IN THOUSANDS) (UNAUDITED)
CONDENSED BALANCE SHEET
12/31/2001
ASSETS
Cash and due from banks $ 567
Time deposits due from banks 300
Securities, at fair value 295
Federal funds sold 12,420
Net loans 1,893
Premises and equipment,
(net of depreciation) 1,259 Other assets 147
TOTAL ASSETS $16,881
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LIABILITIES AND SHAREHOLDERS'
EQUITY LIABILITIES
Deposits
Noninterest bearing $ 984
Interest bearing 7,612
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Total Deposits 8,596
Other borrowed funds 90
Other liabilities 239 --------
TOTAL LIABILITIES $ 8,925
SHAREHOLDERS' EQUITY
Common stock 9,491
Accumulated deficit (1,535)
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TOTAL SHAREHOLDERS' EQUITY $ 7,956
TOTAL LIABILITIES &
SHAREHOLDERS' EQUITY $ 16,881
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CONDENSED STATEMENT OF INCOME
Results of Operations
Period from 11/5/01
To 12/31/01
Net interest income $ 23
Provision for possible
loan losses 24
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Net interest income after
provision for possible
loan losses (1)
Noninterest income 1
Noninterest expense 413
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Loss before taxes ( 413)
Income taxes 0
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NET LOSS $ ( 413)
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Earnings per Share:
basic and diluted $ ( 0.42)
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