United Panam Financial Announces First Quarter 2000 Results
2 May 2000
United Panam Financial Announces First Quarter 2000 Results
SAN MATEO, Calif.--May 1, 2000--United PanAm Financial Corp. (Nasdaq:UPFC) today announced results for its first quarter ended March 31, 2000.For the quarter, the company reported net income of $1.0 million, or $0.06 per diluted share, compared with net income of $801,000, or $0.04 per diluted share, for the same period a year ago. Income from continuing operations was $1.0 million, or $0.06 per diluted share for the current first quarter compared with $605,000, or $0.03 per diluted share for the same period a year ago.
Interest income for the first quarter rose to $8.4 million, compared with $6.7 million a year ago. Net interest income also increased to $6.7 million for the 2000 first quarter from $5.2 million a year earlier.
As announced on February 9, 2000, United PanAm discontinued its subprime mortgage origination operations and recorded the estimated loss from discontinuing these activities in its 1999 financial statements. All related operating activity of the mortgage operations including gains on the sales of loans has been reclassified and reported as discontinued operations in the Company's consolidated financial statements.
"Continued growth in the automobile finance operations contributed to the increase in net interest income and net income," said Lawrence J. Grill, president and chief executive officer. "With the disposition of the subprime mortgage operations, United PanAm's resources and management can now be focused on new business opportunities and auto and insurance premium finance."
Gross automobile receivables increased to $140.1 million at March 31, 2000 from $95.5 million in the comparable period a year ago, while annualized net charge-offs declined to 3.99% in the 2000 first quarter compared with 4.37% in the comparable period a year ago. Total delinquencies as a percentage of net auto contracts outstanding also declined to 0.46% at March 31, 2000 from 0.48% at March 31, 1999. During the past year, the company opened seven automobile finance branches for a total of 22 branches in ten states. The insurance premium finance business with $31.1 million in outstandings also contributed to income from continuing operations.
During the first quarter of 2000, the company, through its subsidiaries and divisions, purchased gross auto contracts totaling $40.3 million and originated $25.0 million in insurance premium finance loans. This compares with $28.1 million and $33.6 million, respectively, in the 1999 first quarter.
At March 31, 2000, the company's capital to assets ratio was 19.14% compared with 19.33% at March 31, 1999, with shareholders' equity totaling $76.6 million, up from $75.4 million at December 31, 1999. Pan American Bank, FSB, the company's banking subsidiary, continues to be "well capitalized" at March 31, 2000, under current Office of Thrift Supervision capital regulations. The Bank had cash, cash equivalents and short-term securities of $130.8 million at March 31, 2000 compared with $100.3 million at December 31, 1999.
United PanAm Financial Corp., a diversified specialty finance company, originates and acquires for investment automobile insurance premium finance contracts and retail automobile installment sales contracts. The company's principal operating units include Pan American Bank, FSB, the largest Hispanic-controlled savings association in California, with five retail branch offices in the state and $295.2 million in deposits at March 31, 2000; the insurance premium finance division, which through a joint venture is the largest non-insurance provider of financing for consumer automobile insurance premiums in California; and United Auto Credit Corporation, with 22 branch offices in Arizona, California, Colorado, Florida, Georgia, Maryland, North Carolina, Oregon, Utah, and Washington.
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 company's business in California, rapid growth of the company's businesses, the accuracy of the charges included in the discontinued operations cost estimate, market valuations associated with retained interests in securitizations, the reliance on the company's systems and controls and key employees, fluctuations in market rates of interest, dependence on whole loan sale market, general economic conditions 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 Operations
(Unaudited)
Three Months
(In thousands, except per share data) Ended March 31,
2000 1999
Interest Income
Loans $ 7,675 $ 6,220
Short term investments 711 527
---------------- ----------------
Total interest income 8,386 6,747
Interest Expense
Deposits 1,703 1,365
Notes payable -- 136
---------------- ----------------
Total interest expense 1,703 1,501
Net interest income 6,683 5,246
Provision for loan losses 72 72
Net interest income after
provision for loan losses 6,611 5,174
---------------- ----------------
Non-interest Income
Service charges and fees 153 196
Loan related charges and fees 54 40
Other income 32 44
---------------- ----------------
Total non-interest income 239 280
Non-interest Expense
Compensation and benefits 3,097 2,690
Occupancy 533 427
Other 1,526 1,309
---------------- ----------------
Total non-interest expense 5,156 4,426
Income from continuing operations
before income taxes 1,694 1,028
Income taxes 692 423
Income from continuing operations 1,002 605
Income from discontinued operations,
net of tax -- 196
Net income $ 1,002 $ 801
Earnings per share-basic:
Continuing operations $ 0.06 $ 0.04
Discontinued operations -- $ 0.01
Net income $ 0.06 $ 0.05
Weighted average shares outstanding 16,533 17,210
Earnings per share-diluted:
Continuing operations $ 0.06 $ 0.03
Discontinued operations -- $ 0.01
Net income $ 0.06 $ 0.04
Weighted average shares outstanding 16,747 17,850
================ ================
United PanAm Financial Corp. and Subsidiaries
Consolidated Statements of Financial Condition
(Unaudited)
March 31, December 31,
(Dollars in thousands) 2000 1999
----------------- -----------------
Assets
Cash and due from banks $ 4,839 $ 4,857
Short term investments 74,499 85,500
----------------- -----------------
Cash and cash equivalents 79,338 90,357
Securities available for sale,
at fair value 41,440 9,918
Securities held to maturity,
at cost 10,000 --
Residual interests in
securitizations, at fair value 20,827 21,227
Loans, net 171,033 158,283
Loans held for sale 56,675 136,460
Premises and equipment, net 1,439 1,429
Federal Home Loan Bank stock, at cost 2,539 2,505
Accrued interest receivable 1,561 1,501
Real estate owned, net 1,625 2,590
Goodwill and other intangible assets 1,587 1,736
Other assets 12,232 12,284
--------------- -----------------
Total assets $400,296 $438,290
Liabilities and Shareholders' Equity
Deposits $295,216 $291,944
Warehouse lines of credit 15,000 54,415
Accrued expenses and other
liabilities 13,473 16,578
----------------- -----------------
Total liabilities 323,689 362,937
Common stock (no par value):
Authorized, 30,000,000 shares
Issued and outstanding,
16,622,350 and 16,369,350
shares at March 31, 2000 and
December 31, 1999, respectively 65,534 65,249
Retained earnings 11,185 10,183
Unrealized loss on securities
available for sale, net (112) (79)
----------------- -----------------
Total shareholders' equity 76,607 75,353
----------------- -----------------
Total liabilities and
shareholders' equity $400,296 $438,290
United PanAm Financial Corp. and Subsidiaries
Selected Financial Data
(Unaudited)
(Dollars in thousands) At or For the
Three Months Ended
March 31, March 31,
2000 1999
--------------- ---------------
Automobile Finance Data
Gross contracts purchased $ 40,328 $ 28,094
Net contracts outstanding 118,693 76,584
Annualized net charge-offs to
average contracts(1) 3.99% 4.37%
Delinquencies (% of net contracts)
31-60 days 0.26% 0.29%
61-90 days 0.10% 0.11%
90+ days 0.10% 0.08%
Insurance Premium Finance Data
Loans originated $ 24,993 $ 33,581
Loans outstanding at period end 31,076 43,558
Annualized net charge-offs to
average loans(1) 0.61% 1.10%
Subprime Mortgage Finance Data
Loans originated $ 76,179 $207,652
Average principal balance per loan 103 111
Loans securitized or sold through
whole loan transactions 148,818 261,875
Percentage of loans sold or
securitized to loans originated 195.4% 126.1%
Other Data
Return on average assets from
continuing operations(1) 1.00% 1.08%
Return on average shareholders'
equity from continuing operations(1) 5.26% 2.96%
Retail deposits $278,423 $257,999
Wholesale deposits 16,793 54,987
Weighted average interest
rate on deposits 5.13% 4.93%
Allowance for credit losses to total loans 8.63% 6.89%
Consolidated capital to assets ratio 19.14% 19.33%
Pan American Bank capital ratios:
Tangible 11.76% 7.88%
Core 11.76% 7.88%
Risk-based 11.96% 10.40%
Note:(1) Quarterly information is annualized for comparability with full year information.