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News Release |
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2006 |
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$38 |
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#843762 |
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NEWS RELEASE
FOR IMMEDIATE RELEASE CONTACT: DANIEL L. KRIEGER,
CHAIRMAN & PRESIDENT
OR
JOHN P. NELSON
VICE PRESIDENT & CFO
(515) 232-6251
JANUARY 20, 2006
AMES NATIONAL CORPORATION
ANNOUNCES
2005 AND FOURTH QUARTER EARNINGS
As of December 31, 2005, loan levels reached record highs with total assets,
deposits and capital reaching record highs in the first two quarters of 2005.
However, the record balance sheet figures did not translate into improved
profitability for the Company in 2005. Net income for the year ended December
31, 2005 decreased 6% to $11,609,000 or $1.23 per share compared to the 2004
results of $12,390,000 or $1.32 per share.
Rising market interest rates resulted in annual net interest income declining 5%
as deposits repriced more quickly than loans and investments. Net interest
income of $25,373,000 was recorded for the year ending December 31, 2005 in
comparison to the $26,790,000 recorded in 2004. The Company's annual net
interest margin declined to 3.56% in 2005 compared to the 3.97% posted in 2004.
Annual interest expense on interest bearing liabilities rose to $15,933,000 for
2005 compared to $10,563,000 posted for 2004, a 51% increase. The higher
interest expense was offset by an 11% increase in annual interest income
totaling $41,306,000 for 2005 compared to the $37,354,000 recorded for 2004.
Return on average assets for 2005 and 2004 was 1.40% and 1.56%, respectively.
Return on equity for the same periods equaled 10.57% and 11.47%, respectively.
The efficiency ratio for the year ending December 31, 2005 was 49.09% compared
to 46.59% for the previous year. The decline in the efficiency ratio in 2005 was
primarily the result of lower net interest income as the 2005 annual noninterest
expense increased less than 2% compared to the same period in 2004. Annual net
securities gains, primarily relating to the Company's equity securities, and
higher trust department revenues contributed to a 7% increase in noninterest
income in 2005 compared to year end 2004 totals.
Net income for the quarter ended December 31, 2005 was $2,709,000, 15% lower
than the $3,191,000 earned in the fourth quarter last year. Earnings per share
were $0.29 for the quarter compared to over $0.34 for the same period in 2004.
Quarterly earnings are lower as higher market interest rates have also resulted
in lower quarterly net interest income. Net interest income has declined 13% to
$6,053,000 for the fourth quarter ended December 31, 2005 compared to $6,948,000
for the same quarter one year ago. Fourth quarter 2005 interest expense
increased 49% while interest income rose only 6% compared to the fourth quarter
of 2004 as loan and investment repricing has lagged behind the liability side of
the balance sheet.
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