United PanAm Financial Announces Fourth Quarter 2003 Results
NEWPORT BEACH, Calif--Jan. 30, 2004--United PanAm Financial Corp. today announced results for its fourth quarter ended Dec. 31, 2003.For the quarter ended Dec. 31, 2003 the company reported net income of $4.6 million, equal to $0.24 per diluted share, compared to net income of $3.5 million, or $0.20 per diluted share for the same period a year ago. This represents a 31% increase in net income between the two periods.
Net interest income, after provision for loan loss, for the fourth quarter of 2003 rose 33% to $18.2 million from $13.7 million in the fourth quarter of 2002.
For the year ended Dec. 31, 2003, the company reported net income of $13.3 million, equal to $0.72 per diluted share, compared to net income of $12.5 million or $0.71 per diluted share for the comparable period a year ago. Income for the year ended Dec. 31, 2003 was adversely impacted by the company's previously announced change in accounting estimate relative to the allowance for loan losses.
The Company purchased $112 million of gross auto loans during the fourth quarter of 2003, representing a 37% increase over the fourth quarter of 2002. Auto loans outstanding totaled $393.6 million at Dec. 31, 2003, a 34% increase over Dec. 31, 2002. The growth in auto loans is the result of planned expansion of the branch network throughout the country and portfolio growth at the branch level. During 2003, the Company opened 16 new auto loan branches bringing its total to 70 branches in 26 states. The Company plans to continue its philosophy of controlled expansion of the auto finance branch network.
Delinquency over 30 days and total repossessions decreased to 1.40% of auto loans at Dec. 31, 2003, compared with 1.61% at Dec. 31, 2002.
The annualized quarterly net charge-off rate also decreased to 6.03% for the fourth quarter of 2003, compared with 6.69% for the comparable period in 2002.
"Our automobile financing unit, UACC, continues to grow at over 30% while at the same time experiencing substantial operational improvement; both charge-offs and delinquencies (plus total repossessions) have declined from last year," said Guillermo Bron, Chairman. "These improvements have primarily been the result of management policies implemented during 2003. We expect additional improvement in 2004 as the economy recovers."
United PanAm Financial Corp., a specialty finance company, originates and acquires for investment retail automobile installment sales contracts and insurance premium finance contracts. Its principal operating units include Pan American Bank, FSB, the largest Hispanic-controlled savings association in California, with $498 million in deposits at Dec. 3, 20031, 2003, United Auto Credit Corp. with 70 branch offices in 26 states, and the insurance premium finance division, which is the largest non-insurance provider of financing for insurance premiums in California.
Any statements set forth above that are not historical facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act ("SLRA") of 1995, including statements concerning the company's strategies, plans, objectives and intentions. Such statements are subject to a variety of estimates, risks and uncertainties, known and unknown, which may cause the company's actual results to differ materially from those anticipated in such forward-looking statements. Potential risks and uncertainties include, but are not limited to, such factors as limited operating history, the impaired or limited credit history of the company's borrowers, the availability of additional financing, the concentration of the bank's business in California, rapid growth of the company's businesses, the reliance on the company's systems and controls and key employees, fluctuations in market rates of interest, general economic conditions, the effects of accounting changes and other risks, certain of which are detailed from time to time in the company's filings with the United States Securities and Exchange Commission.
United PanAm Financial Corp. and Subsidiaries
Consolidated Statements of Financial Condition
(Unaudited)
Dec. 31, Dec. 31,
(Dollars in thousands) 2003 2002
Assets
Cash and due from banks $8,376 $9,964
Short term investments 5,833 3,590
Cash and cash equivalents 14,209 13,554
Securities available for sale, at fair value 1,202,444 603,268
Loans, net of unearned discount 426,624 326,352
Less allowance for loan losses (20,384) (23,179)
Loans, net 406,240 303,173
Premises and equipment, net 3,163 2,700
Federal Home Loan Bank stock, at cost 11,563 1,675
Accrued interest receivable 9,849 6,785
Other assets 23,248 20,131
Total assets $1,670,716 $951,286
Liabilities and Shareholders' Equity
Deposits $498,389 $468,458
Repurchase Agreements 1,052,205 384,624
Accrued expenses and other liabilities 6,795 8,545
Trust preferred securities 10,000 --
Total liabilities 1,567,389 861,627
Common stock (no par value)
Authorized, 30,000,000 shares
Issued and outstanding, 16,100,204 at
Dec. 31, 2003
and 15,836,725 at Dec. 31, 2002 66,109 64,957
Retained earnings 37,089 23,814
Unrealized gain on securities available
for sale, net 129 888
Total shareholders' equity 103,327 89,659
Total liabilities and shareholders' equity $1,670,716 $951,286
United PanAm Financial Corp. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
Three Months Twelve Months
(In thousands, except per share Ended Dec. 31, Ended Dec. 31,
2003 2002 2003 2002
Interest Income
Loans $25,130 $15,816 $84,614 $58,013
Securities 4,758 3,746 16,597 13,344
Total interest income 29,888 19,562 101,211 71,357
Interest Expense
Deposits 3,413 3,826 14,048 13,676
Federal Home Loan Bank
advances -- -- -- 823
Repurchase Agreements 2,832 1,626 9,098 4,651
Total interest expense 6,245 5,452 23,146 19,150
Net interest income 23,643 14,110 78,065 52,207
Provision for loan losses 5,433 404 17,737 638
Net interest income
after provision for
loan losses 18,210 13,706 60,328 51,569
Non-interest Income
Net gain on sale of securities 104 220 506 491
Service charges and fees 221 200 872 787
Loan related charges and fees 76 75 307 306
Other income 414 205 1,678 296
Total non-interest income 815 700 3,363 1,880
Non-interest Expense
Compensation and benefits 7,288 5,548 26,538 20,474
Occupancy 1,219 1,060 4,485 3,769
Other 2,853 2,281 10,381 9,111
Total non-interest expense 11,360 8,889 41,404 33,354
Income before income taxes
and cumulative effect of
change in accounting
principle 7,665 5,517 22,287 20,095
Income taxes 3,096 2,015 9,012 7,674
Income before cumulative effect
of change in accounting
principle 4,569 3,502 13,275 12,421
Cumulative effect of change in
accounting principle net of tax -- -- -- 106
Net income $4,569 $3,502 $13,275 $12,527
Earnings per share-basic:
Income before cumulative
effect of change in
accounting principle $0.29 $0.22 $0.83 $0.79
Cumulative effect of change
in accounting principle -- -- -- 0.01
Net income $0.29 $0.22 $0.83 $0.80
Weighted average shares
outstanding 16,020 15,771 15,914 15,630
Earnings per share-diluted:
Income before cumulative
effect of change in
accounting principle $0.24 $0.20 $0.72 $0.70
Cumulative effect of change
in accounting principle -- -- -- 0.01
Net income $0.24 $0.20 $0.72 $0.71
Weighted average shares
outstanding 19,098 17,687 18,464 17,588
Selected Financial Data
(Unaudited)
At or For the At or For the
(Dollars in thousands) Three Months Twelve Months
Ended Ended
December December
31, 31, 31, 31,
2003 2002 2003 2002
Automobile Finance Data
Gross contracts purchased $112,203 $81,911 $449,175 $234,370
Contracts outstanding 408,002 294,855 408,002 214,020
Allowance for credit losses
to total loans 4.93% 7.71% 4.93% 7.71%
Unearned discount on loans to
total loans 3.52% --% 3.52% --%
Annualized net charge-offs to
average contracts(a) 6.03% 6.69% 5.67% 6.20%
Delinquencies (% of net contracts)
31-60 days 0.49% 0.44% 0.49% 0.44%
61-90 days 0.17% 0.20% 0.17% 0.20%
90+ days 0.10% 0.09% 0.10% 0.09%
Repossessed assets 0.65% 0.88% 0.65% 0.88%
Insurance Premium Finance Data
Loans originated $27,590 $22,927 $119,561 $106,948
Loans outstanding at period
end 41,243 36,322 41,243 36,322
Allowance for loan losses 0.65% 1.27% 0.65% 1.27%
Annualized net charge-offs to
average loans(a) 0.67% 0.52% 0.40% 0.72%
Allowance for credit losses
to total loans 0.65% 1.28% 0.65% 1.28%
Other Data
Return on average assets(a) 1.13% 1.46% 0.99% 1.57%
Return on average
shareholders' equity(a) 18.01% 15.89% 13.75% 15.37%
Retail deposits $344,025 $312,731 $344,025 $312,731
Brokered deposits 154,364 155,727 154,364 155,727
Weighted average interest
rate on deposits 2.59% 3.22% 2.59% 3.22%
Consolidated capital to
assets ratio 6.18% 9.43% 6.18% 9.43%
Pan American Bank capital
ratios:
Tangible 6.12% 8.26% 6.12% 8.26%
Core 6.12% 8.26% 6.12% 8.26%
Risk-based 17.28% 18.48% 17.28% 18.48%
(a) Quarterly information is annualized for comparability with
full year information.