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Middlefield Banc Corp. Reports 12% Earnings Increase for 2003

Middlefield Banc Corp. 2004 Press Releases

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Contact Info: James R. Heslop, 2nd
Executive Vice President/Chief Operating Officer
440.632.1666 Ext. 3219
Date: January 24, 2004

MIDDLEFIELD, OHIO Middlefield Banc Corp. (Pink Sheets:  MBCN) today reported net income for the fiscal year ended December 31, 2003, of $2,799,000, an increase of 11.92% over the $2,501,000 reported for 2002.  Earnings per diluted share for 2003 were $2.29, which compares to 2002’s $2.06.   

For the three months ended December 31, 2003, of $832,000, or $0.68 per diluted share.  The fourth quarter 2003 earnings represent an increase of 12.28% over the $741,000, or $0.61 per diluted share, recorded for the quarter ended December 31, 2002.

Middlefield’s total assets ended 2003 at $262,369,000, an increase of 15.97% over the level recorded at year-end 2002 of $226,246,000.  Net loans increased 10.26% to $190,359,000, while deposits grew 17.32% to $219,840,000.  Stockholders’ equity at year-end 2003 was $23,504,000, an increase of 8.08% over the prior year-end.

Non-interest income for the full year showed a 29.40% increase over 2002.  The primary contributing factors were increased levels of service charges and earnings on bank owned life insurance.

The increase in non-interest expense, 17.27% on a full year basis, is the result of the opening of a new banking office in Orwell, Ohio, as well as the start-up of a financial services center.  An additional part of this increase was due to the implementation of an annual incentive plan applicable to all employees.

The company’s key performance ratios for the year and for the fourth quarter remained strong.  Return on Average Assets (ROA) for the year and for the quarter were 1.13% and 1.26%, respectively, compared to 1.17% and 1.31% a year ago.  Return on Average Equity (ROE) improved to 12.39% for the year and 14.86% for the quarter.  The comparable 2002 ratios were 12.08% and 13.79%.

Thomas G. Caldwell, President and Chief Executive Officer, commented, "Recognizing all of the obstacles to net income growth that 2003 presented, we are very pleased with our results.  Although we continued to experience compression of our net interest margin, we were able to grow both sides of our balance sheet, while achieving a reasonable level of earnings growth."

"The increase in 2003 earnings following a 10.14% increase in 2002 is the result of the excellent efforts of our staff.  As we continue to focus on our core business model of being a true community bank, they have stepped forward to continue to provide the best in products and service to the markets that we serve," continued Caldwell.

Book value at year-end 2003 was $19.21, an increase of 6.79% from the $17.98 recorded at the end of 2002.  Cash dividends paid during the year totaled $0.82 per share.  Additionally, a five percent stock dividend was paid during December of 2003.  The comparable adjusted cash dividend during 2002 was $0.70.

Middlefield Banc Corp. is the parent company of The Middlefield Banking Company, an Ohio state-chartered bank, both of which are headquartered in Middlefield, Ohio.  The Middlefield Banking Company operates six full service banking centers and a LPL Financial brokerage office serving Chardon, Garrettsville, Mantua, Middlefield, and Orwell, Ohio. For more information, please visit www.middlefieldbank.com.

 This announcement contains forward-looking statements that involve risk and uncertainties, including changes in general economic and financial market conditions and the Company’s ability to execute its business plans.  Although management believes the expectations reflected in such statements are reasonable, actual results may differ materially.

 

    Middlefield Banc Corp.
    Consolidated Statements of Income
    (unaudited)
                   
      For the Three Months Ended December 31,
      2003     2002     % Change
                   
Earnings (in 000s)                
  Total interest income   $ 3,682   $ 3,609     2.02%
  Total interest expense 1,393     1,509     -7.69%
  Net interest income 2,289   2,100 9.00%
  Provision for loan losses   0 75 -100.00%
  Net interest income after              
  provision for loan losses 2,289     2,025     13.04%
  Non-interest income 470     313     50.16%
  Security (losses) gains 0     0     0.00%
  Non-interest expense 1,589     1,333     19.20%
  Income before income tax 1,170     1,005     16.42%
  Federal income taxes 338     264     28.03%
  Net income $ 832   $ 741   12.28%
                   
Per share (1)                
  Earning per common share - Basic $ 0.68   $ 0.61   11.81%
  Earning per common share - Diluted 0.68     0.61     11.65%
  Cash dividends paid   0.21   0.19 10.25%
                   
Shares Outstanding                
  Basic   1,219,449     1,214,300     0.42%
  Diluted   1,223,652     1,216,811     0.56%
                   
Key performance ratios                
  Return on average assets (ROA) 1.26%     1.31%     -3.82%
  Return on average equity (ROE) 14.86%     13.79%     7.76%
  Net interest margin 3.96%   3.96%   0.00%
  Yield on earning assets 6.25%     6.72%     -6.99%
  Efficiency ratio   56.42%     55.24%     2.14%
  Net charge-offs to average loans              
  (actual for the period)   0.04%   0.00% N/A
  Net charge-offs to average loans              
  (annualized)   0.18%     0.01%     1700.00%

 

    Middlefield Banc Corp.
    Consolidated Statements of Income
    (unaudited)
                   
      For the Twelve Months Ended December 31,
      2003     2002     % Change
                   
Earnings (in 000s)                
Total interest income $ 14,596   $ 14,120   3.37%
  Total interest expense 5,725     6,148     -6.88%
  Net interest income 8,871   7,972   11.28%
  Provision for loan losses 315     300     5.00%
  Net interest income after              
  provision for loan losses 8,556     7,672     11.52%
  Non-interest income 1,479     1,143     29.40%
  Security (losses) gains 1     0     N/A
  Non-interest expense 6,105     5,206     17.27%
  Income before income tax 3,931     3,609     8.92%
  Federal income taxes 1,132     1,108     2.17%
  Net income $ 2,799   $ 2,501   11.92%
                   
Per share (1)                
  Earning per common share - Basic $ 2.29   $ 2.06   11.32%
  Earning per common share - Diluted 2.29     2.06     11.27%
  Cash dividends paid 0.82     0.7     17.14%
  Book Value (end of period) 19.21     17.98     6.79%
                   
Shares Outstanding                
  Basic   1,219,476     1,215,237     0.35%
  Diluted   1,222,829     1,217,231     0.46%
                   
At period end (in 000s)                
  Total Assets $ 262,369   $ 226,246   15.97%
  Total deposits   219,840     187,384     17.32%
  Net loans receivable 190,359     172,643     10.26%
  Securities   51,825     42,159     22.93%
  Shareholders equity 23,504     21,746     8.08%
                   
Key performance ratios                
  Return on average assets (ROA) 1.13%     1.17%     -3.42%
  Return on average equity (ROE) 12.39%     12.08%     2.57%
  Net interest margin 3.87%   3.99%   -3.01%
  Yield on earning assets 6.30%     6.99%     -9.87%
  Efficiency ratio   58.98%     57.12%     3.26%
  Net charge-offs to average loans 0.05%     0.04%     25.00%
  Total allowance for loan losses              
  to nonperforming loans 495.28%     427.51%     15.85%
  Nonperforming loans to total loans 0.27%     0.31%     -12.90%
  Total allowance for loan losses to total loans 1.31%     1.31%     -0.23%
  Equity to assets at period end 8.96%     9.61%     -6.78%
(1) Per share data has been restated to reflect the five per cent stock dividend paid in 2003

 

      Middlefield Banc Corp.
      Consolidated Balance Sheet
      As of December 31,
      2003     2002
  ASSETS        
  Cash and due from banks $ 4,496   $ 2,347
  Federal funds sold 930     350
  Securities available for sale 49,966     35,917
  Securities held to maturity   1,859     6,242
  Total cash and securities 57,251   44,856
  Loans   192,880     174,943
  Less: reserve for loan losses   2,521     2,300
  Loans, net   190,359   172,643
  Premises and equipment 6,808     6,481
  Bank-owned life insurance 5,202     0
  Accrued interest receivable and other assets   2,749     2,266
  TOTAL ASSETS $ 262,369   $ 226,246
             
      As of December 31,
      2003     2002
  LIABILITIES          
  Deposits $ 219,840   $ 187,384
  Borrowed funds   18,110     16,476
  Other liabilities   915     640
  TOTAL LIABILITIES   238,865     204,500
             
  EQUITY          
  Common equity   25,124     22,934
  Net Unrealized gain (loss) on securities 125     475
  Treasury stock   -1,745     -1,663
  TOTAL EQUITY 23,504   21,746
             
  TOTAL LIABILITIES & EQUITY $ 262,369   $ 226,246