Heritage Oaks Bancorp Reports Fourth Quarter Results - 1/30/17
PASO ROBLES, Calif., Jan. 30, 2017 (GLOBE NEWSWIRE) -- Heritage Oaks Bancorp (“Heritage Oaks” or the “Company”) (NASDAQ:HEOP), a bank holding company and parent of Heritage Oaks Bank (the “Bank”), reported net income available to common shareholders of $4.6 million, or $0.13 per diluted common share, for the fourth quarter of 2016 compared to net income available to common shareholders of $3.5 million, or $0.10 per diluted common share, for the fourth quarter of 2015, and net income available to common shareholders of $4.2 million, or $0.12 per diluted common share for the third quarter of 2016. For the year ended December 31, 2016, net income available to common shareholders was $16.9 million, or $0.49 per diluted common share compared with net income available to common shareholders of $15.3 million, or $0.44 per diluted common share for the year ended December 31, 2015.
Fourth Quarter and Year End 2016 Highlights
- Gross loans increased by $138.2 million, or 11.1%, to $1.39 billion at December 31, 2016 compared to $1.25 billion a year earlier, and increased by $42.8 million, or 3.2%, compared to $1.34 billion at September 30, 2016. New loan production totaled $124.8 million for the fourth quarter of 2016, an increase of 10.3% compared to the linked quarter.
- Total deposits increased by $118.9 million, or 7.6%, to $1.68 billion at December 31, 2016 compared with $1.56 billion a year earlier, and increased by $52.5 million, or 3.2%, during the fourth quarter of 2016. Non-interest bearing demand deposits grew by 11.5% during the last year and by 0.7% over the last quarter to $574.0 million, and represent 34.1% of total deposits at December 31, 2016.
- Credit quality remains strong with non-accrual loans representing 0.49% of total gross loans at December 31, 2016, down from 0.63% a year ago, and up from 0.36% for the linked quarter. Net recoveries for the fourth quarter of 2016 were $0.1 million compared to $0.2 million for the linked quarter and $0.2 million for the fourth quarter of 2015. Loans delinquent 30 to 89 days as a percentage of gross loans increased to 0.02% from 0.00% for the linked quarter, and remained the same relative to 0.02% at December 31, 2015.
- Regulatory capital ratios for the Bank at December 31, 2016 were 9.47% for Tier 1 Leverage Capital, 13.35% for Total Risk Based Capital, and 12.19% for Common Equity Tier One Capital.
- On January 25th, 2017 the Company’s board of directors declared a dividend of $0.06 per common share for shareholders of record as of February 15th, 2017, which is payable to our common shareholders on February 28th, 2017.
- As previously announced, the Company entered into a definitive agreement to be acquired by Pacific Premier Bancorp, Inc. (NASDAQ:PPBI) for an aggregate purchase price of $405.6 million, or $11.68 per share based on the closing price for Pacific Premier Bancorp, Inc.’s common stock of $33.65 as of December 12, 2016. Under the terms of the definitive agreement, upon consummation of the transaction, holders of Heritage Oaks Bancorp common stock will have the right to receive 0.3471 shares of Pacific Premier common stock for each share of Heritage Oaks common stock they own. The acquisition remains subject to regulatory and shareholder approvals. This acquisition will provide the Company’s customers with an expanded product set and services and Heritage Oaks Bank customers will continue to receive the same excellent customer service. The acquisition also increases the combined entity’s geographic footprint to cover the coast of California from San Diego to Paso Robles.
“2016 marked a year of multiple successes for the Company, which should provide many long-term benefits for its shareholders, customers, and employees,” stated Simone Lagomarsino, President and Chief Executive Officer of Heritage Oaks Bancorp. “We achieved double-digit growth in loans and non-interest bearing demand deposits during 2016, and we also introduced our new interest rate swap product, which generated over $1.2 million in fee income. We successfully terminated the Bank Secrecy Act Consent Order, which should result in lower costs and improve our efficiency going forward. Finally, we announced our strategic merger with Pacific Premier Bancorp, Inc., which we believe will create a more attractive commercial banking franchise. Once the two organizations are combined we will offer a broader array of products and services, increased lending capacity, and an expanded geographic footprint. All of this should position us to better serve our customers and provide stronger returns to our shareholders,” stated Ms. Lagomarsino.