This excerpt taken from the FSNM 8-K filed May 2, 2006.
FIRST STATE REPORTS SOLID LOAN AND DEPOSIT GROWTH
Albuquerque, NMMay 1, 2006First State Bancorporation (First State) (NASDAQ:FSNM) today announced first quarter 2006 earnings of $4.3 million, or $0.24 per diluted share, compared to $4.3 million or $0.28 per diluted share for the first quarter of 2005. First quarter 2006 earnings included approximately $825,000 of expenses related to the acquisition of Access Anytime Bancorp, Inc. and New Mexico Financial Corporation, including approximately $525,000 related to the conversion and implementation of information systems and $200,000 related to name and signage changes. In addition to the significant costs related to the acquisitions recorded in the first quarter, the Company recorded $2.7 million in provision for loan losses, $1.1 million of which related primarily to growth in loans in the first quarter and additional allowance on loans acquired. Loan growth in the first quarter approximated 24% on an annualized basis exclusive of loans acquired.
First State completed the acquisitions and mergers of Access Anytime Bancorp, Inc. (Access) (Nasdaq Smallcap: AABC), and New Mexico Financial Corporation (NMFC) on January 3, 2006 and January 10, 2006, respectively. In the Access transaction, First State issued 1,416,940 shares of First State common stock. In the NMFC transaction, First State issued 717,812 shares of common stock and paid $2.7 million in cash consideration. Both transactions were accounted for using the purchase method of accounting, and accordingly, the assets and liabilities of Access and NMFC were recorded at fair value on their respective acquisition dates. First State acquired approximately $229 million in loans, approximately $410 million in deposits, and recognized goodwill of approximately $23 million for the two acquisitions combined. The Access and NMFC account balances acquired and the results of operations of each entity subsequent to their respective acquisition dates are included in the results of First State.
At March 31, 2006, total assets increased $599.1 million, net loans increased $404.1 million, investment securities increased $79.5 million, and deposits increased $551.8 million over March 31, 2005. First States total assets increased 32% from $1.893 billion at March 31, 2005, to $2.492 billion at March 31, 2006. Net loans increased 29% from $1.409 billion at March 31, 2005, to $1.813 billion at March 31, 2006. Total deposits grew 39% from $1.414 billion at March 31, 2005, to $1.966 billion at March 31, 2006. Non-interest bearing deposits grew to $454 million at March 31, 2006, from $320 million at March 31, 2005, while interest bearing deposits grew to $1.511 billion from $1.094 billion for the same period. Excluding the loans and deposits acquired in January, total loans increased by $89 million and deposits by $47 million from December 31, 2005 to March 31, 2006.
We experienced outstanding loan and deposit growth in the first quarter in addition to the loans and deposits which we picked up in the two acquisitions which we closed in January, stated Michael R. Stanford, President and Chief Executive Officer. Our net interest margin improved as a result of the loans and deposits which we acquired, as well as our strong loan demand and the increase in interest rates by the Federal Reserve in recent months. Our profitability for the quarter has been impacted by expenses related to the acquisitions and the change in name of our bank subsidiary, but we expect most of those expenses to be short-lived. The strong net interest margin and our excellent growth trends bode well for a return to much better profitability during the rest of the year, especially the third and fourth quarters, continued Stanford.