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United Security Bancshares, Inc. Reports Improved Second Quarter Results

Stock quotes in this article: USBI 

Net loans declined to $355.4 million in the second quarter of 2012, compared with $381.1 million at December 31, 2011. The decrease in net loans was due to loan payoffs and write-downs outpacing new loans. An overall weak economy, primarily centered in the real estate sector, has been a significant factor in lower loan demand.

Interest income totaled $9.7 million in the second quarter of 2012, compared with $10.6 million in the second quarter of 2011. The decline in interest income was due in large part to lower earning assets, primarily loans, compared with the second quarter of 2011.

Interest expense declined 33.8% to $1.2 million in the second quarter of 2012, compared with $1.8 million in the second quarter of 2011. The decrease resulted primarily from lower interest rates paid, offset partially by growth in interest-bearing deposits compared with the prior year.

Provision for loan losses declined to $468,000 in the second quarter of 2012, or 0.5% of annualized average loans, compared with $1.6 million, or 1.6% of annualized average loans, in the second quarter of 2011. Net charge-offs declined to $1.1 million in the second quarter of 2012, compared with $2.6 million in the second quarter of 2011. The decline in the provision for loan losses was due primarily to lower net charge-offs.

Total non-interest income was $1.3 million in the second quarter of 2012, compared with $2.2 million in the second quarter of 2011. The 2011 results included a $401,000 gain on security sales and a $258,000 reimbursement of attorney fees from a previous fidelity bond claim in other income. No similar gains were booked in the second quarter of 2012.

Total non-interest expense declined 8.7% to $7.4 million in the second quarter of 2012, compared with $8.2 million in the second quarter of 2011. The decline in non-interest expense was due primarily to lower salaries and employee benefits and to a decrease in the impairment charge on OREO.

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