Most Fort Smith regional banks sport good quarterly financial reports
by December 10, 2008 2:17 pm 108 views
story by Michael Tilley
Most banks based and operating in the Fort Smith area have a few things in common: a decline in net income, decline in dividends and increases in bad loans and real estate holdings.
But despite a few financial hickeys, area banks are healthy relative to their counterparts in other parts of the state and nation, according to figures from reports the banks file with federal regulators.
The king of the hill, so to speak, is Fort Smith-based First National Bank. The bank — whose parent company owns other banks and insurance companies in Northwest Arkansas and eastern Oklahoma — posted net income of $7.07 million for the first nine months of 2008. The income reflects a 34.5 percent drop from the first nine months of 2007. First National recorded $14.61 million in net income for all of 2007.
The bank halved its dividend payments to $4 million — paid from the bank to the parent company, First Bank Corp. — for the first nine months of 2008 compared to $8 million for the same period in 2009.
As a sign of trouble in the real estate and housing market, the bank has seen its value of real estate owned jump to $14 million as of Sept. 30, compared to just $2.6 million as of Sept. 30, 2007. An increase in real estate owned by banks is an indication that foreclosures increased homes, land and other property held by the bank.
Sam T. Sicard, a bank vice president, said bank earnings are down because of a “dramatic decline” in interest rates and the increase in provisions for loan losses. He said most of the real estate owned by and the loan loss provisions are related to the bank’s lending activities in Benton County. That Northwest Arkansas county has seen a dramatic increase in home foreclosures and a growing number of abandoned subdivisions. “Earnings are down due to the dramatic decline in interest rates and to an increase in provisions for loan losses. The increase in provisions and (other real estate owned) is primarily due to Benton County subdivisions,” Sicard said in an e-mail note. “We will always actively work to sell real estate, but are prepared to hold real estate until excess supply of houses and lots are absorbed by the continued growth in (Northwest Arkansas).”
Sicard said the bank is positioned well in terms of capital ratios. His claim is confirmed by the federal call reports, with shows the bank’s tier one ratio at 13.71, compared to 8.94 for the bank’s national peer group. “We are pleased that our earnings and capital continues to far exceed national and state industry averages this year,” Sicard said.
First National Bank of Sallisaw posted net income of $2.75 million for the first nine months of 2008, down from $3.29 million for the same period of 2007. The bank, however, has not had trouble with real estate holdings. Its holdings as of Sept. 30 were a mere $325,000.
Farmers Bank of Greenwood saw net income of $1.85 million for the first nine months of 2008, just a slight decrease from $1.94 million for the same period of 2007. The bank also has kept its real estate portfolio under control, with just $828,000 in real estate owned as of Sept. 30.
Two exceptions to the relative health of area banks are Booneville-based First Western Bank and Mulberry-based Allied Bank.
First Western, once active in the troubled Northwest Arkansas housing market, posted a $1.13 million loss for the first nine months of 2008. The bank posted a loss of $244,000 for the same period of 2007. Also, the bank’s real estate holdings jumped to $9.78 million as of Sept. 30, up 278 percent over holdings as of Sept. 30, 2007.
While Allied Bank posted respectable income figures — $1.35 million for the first nine months of 2008, compared to $1.53 million for the same period in 2007 — its real estate holdings jumped $1.79 million as of Sept. 30.
Fort Smith-based Benefit Bank posted net income of just $464,000 as of Sept. 30. Also, the thrift could have problem loans in its pipeline. As of Sept. 30, Benefit had $4.98 million in loans 30-89 days overdue.
The smallest bank in the region — based on assets — is doing well. Scranton-based Logan County Bank had net income of $540,000 as of Sept. 30, up 14.6 percent over the same period of 2007. Also, the bank has no real estate holdings and its total non-current loans were just $391,000 as of Sept. 30.
Following are some financial details of banks based in the Fort Smith area. (Banks listed in order of asset size. All figures in $000.)
The First National Bank of Fort Smith
Average Assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$797,147 $799,314 $800,737
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$7,074 $10,813 $14,617
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$34,559 $41,442 $54,977
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$4,000 $8,000 $13,000
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$12,218 $19,484 $17,899
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$14,092 $2,607 $2,482
First Western Bank, Booneville
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$297,980 $305,641 $307,021
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
-$1,139 -$244 $122
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$13,165 $15,614 $20,708
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$0 $600 $600
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$7,294 $10,220 $11,927
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$9,785 $2,588 $2,731
First National Bank of Sallisaw
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$199,171 $192,317 $191,609
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$2,752 $3,294 $4,316
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$8,682 $9,335 $12,389
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$2,390 $3,275 $4,275
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$33 $204 $1,462
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$325 $26 $0
Farmers Bank of Greenwood
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$194,473 $191,156 $191,170
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,851 $1,949 $2,312
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$9,236 $9,516 $12,689
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$2,000 $2,000 $2,000
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
-$149 -$51 $312
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$279 $195 $202
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$828 $667 $717
The Central National Bank of Poteau
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$176,676 $164,334 $165,068
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$3,296 $3,526 $4,432
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$8,190 $8,877 $11,907
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,194 $1,514 $3,311
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$2,102 $2,012 $1,121
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$4,182 $958 $1,036
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$226 $289 $289
The Community State Bank (Poteau)
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$135,107 $123,580 $124,078
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$992 $575 $926
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$6,810 $6,575 $8,835
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$84 $345 $437
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$908 $230 $489
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,125 $1,298 $1,146
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$230 $337 $424
Allied Bank (Mulberry)
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$133,133 $126,579 $127,801
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,356 $1,538 $1,880
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$6,432 $6,779 $9,141
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$896 $914 $1,192
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$460 $624 $688
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,094 $524 $0
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,794 $587 $521
The First National Bank at Paris
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$104,826 $104,510 $104,057
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,208 $996 $1,301
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$4,798 $4,855 $6,432
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$0 $0 $1,208
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,208 $996 $93
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,499 $536 $1,006
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$44 $90 $3
National Bank of Sallisaw
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$95,954 $94,623 $94,516
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$737 $1,014 $1,297
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$3,946 $4,560 $6,034
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$500 $600 $1,000
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$237 $414 $297
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$579 $248 $247
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,846 $786 $794
First Community Bank of Crawford County
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$71,091 $60,445 $62,133
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$369 $238 $364
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$3,325 $3,032 $4,150
Cash dividends declared
(no dividends paid in any period)
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,308 $1,416 $1,664
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$0 $63 $0
Spiro State Bank
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$52,477 $50,101 $50,598
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$359 $427 $470
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$1,945 $2,170 $2,916
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$120 $120 $240
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$239 $307 $230
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$168 $63 $49
All other real estate owned
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$51 $51 $51
Logan County Bank (Scranton)
Average assets
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$63,735 $61,832 $62,468
Net income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$540 $471 $607
Total interest income
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$2,700 $2,655 $3,586
Cash dividends declared
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$180 $180 $240
Retained earnings
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$360 $291 $367
Total non-current loans and leases
Sept. 30, 2008 Sept. 30, 2007 Fiscal year 2007
$391 $187 $264
All other real estate owned
(no real estate owned for any period)