MISSOULA, MT -- (Marketwire) -- 01/30/12 -- Treasure State Bank ("the Bank") (OTCBB: TRSU), a Montana chartered community bank, today announced:
President and Chief Executive Officer Jim Salisbury stated, "I am pleased to report that we are celebrating our fifth anniversary by reporting our fourth consecutive quarter of profitability resulting in a year to date profit of $365,000, as compared with a net operating loss of $4.5MM for the same period last year, or an improvement of approximately $4.9MM. The Bank believes that the large loan loss provision of $5.1MM reflected in the 2010 financial results has put the Bank in a position to manage the Bank's non-performing assets. The Bank now has an allowance for loan losses to gross loans of 4.0% ($2.0MM) to act as a cushion to absorb potential losses on existing troubled loans. The Bank continues to work diligently to address non-performing assets. During the year 2011, the Bank sold $2.3MM of non-performing assets. The Bank has $3.8MM of repossessed property as of December 31, 2011, as compared to $5.0MM as of December 31, 2010. Total non-performing assets, which include repossessed assets, decreased $700,000 during the year to $8.6MM as of December 31, 2011, down from $9.3MM as of December 31, 2010.
"In addition to the $365,000 in earnings for 2011, and in an effort to continue to build the capital ratios, assets have decreased $3.7MM to $77.0MM as of December 31, 2011, down from $80.7MM as of December 31, 2010. Gross loans have decreased $6.2MM to $50.6MM as of December 31, 2011, down from $56.8MM as of December 31, 2010. $1.4MM of loans were transferred to real estate owned in 2011. The Bank continues to lend to qualified borrowers and is actively seeking qualified borrowers. During the year 2011, the Bank originated $5.7MM in new loans.
"The Bank has worked diligently to reduce its cost of funds to 1.52% at December 31, 2011, from 1.76% at December 31, 2010 and from a high of 3.46% at September 30, 2009. The ability to further reduce the Bank's cost of funds is now limited, but reducing the cost of funds to acceptable levels has positioned the Bank to have a net interest margin that allows the Bank to be profitable in spite of the large dollar amount of non-performing assets.
"Nearly twenty five cents of every dollar is held in domestic liquid assets to cushion the Bank from a rising interest rate environment. The Bank has positioned itself to be asset sensitive. Therefore, if interest rates were to increase, the effect on the Bank's net interest income should not be material.
"The Western Montana economy continues to present challenges to the Bank in its efforts to dispose of repossessed property and certain portions of its loan portfolio. We will continue to work diligently to improve the asset quality of the Bank, generate profits to enhance stockholders' equity and retain adequate liquidity in these uncertain economic times."
For more information regarding this release, or the Bank in general, you may contact James A. Salisbury, President and CEO, at 406-543-8700.
About Treasure State Bank
Treasure State Bank, a Montana chartered community bank, is headquartered in Missoula, Montana. The Bank was founded in January 2007. Treasure State Bank currently trades on the OTCBB under the ticker symbol "TRSU". Treasure State Bank serves businesses, professionals, non-profit organizations and individuals through customized banking services and products. For more information, please visit www.treasurestatebank.com.
Safe Harbor Statement
This communication contains statements that may constitute "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations of Treasure State Bank and members of its management as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Important factors currently known to management that could cause actual results to differ materially from those in forward-statements include fluctuation of operating results, the ability to compete successfully, and the ability to complete before-mentioned transactions. The Bank undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.
James A Salisbury
President & CEO
Treasure State Bank
3660 Mullan Road, Missoula, MT 59808