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Treaty Oak Bancorp, Inc. Reports Quarterly Results

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  Published in Business and Finance on Tuesday, February 10th 2009 at 13:56 GMT, Last Modified on 2009-02-10 13:57:54 by Market Wire
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AUSTIN, Texas--([ BUSINESS WIRE ])--Treaty Oak Bancorp, Inc. (the "Company") (Pink Sheets: TOAK) today reported a net loss of $385,000 for its quarter ended December 31, 2008 compared to a net loss of $226,000 for quarter ended December 31, 2007. Results for the Company's wholly owned subsidiary Treaty Oak Bank was a net loss of $180,000 for the quarter ended December 31, 2008, after an additional special loan loss and other real estate owned provision of $300,000 and a credit related to deferred tax assets of $105,000, compared with net income of $127,000 for quarter ended December 31, 2007. Total assets of Treaty Oak Bank were $136.0 million and total deposits were $115.6 million at December 31, 2008, compared with $111.6 million and $100.7 million, respectively, as of December 31, 2007. Net loans increased by $8.5 million during the quarter ended December 31, 2008, or 8.5%.

"In the calendar fourth quarter interest margin compression continued to be the most significant issue faced by Treaty Oak Bank, although actions such as interest rate floors and increased rates on renewing loans began to show a mitigating effect," noted President and CEO Jeff Nash. "Nonetheless the continuation of an unprecedented decline in interest rates totaling 4.5 percent over the prior 15 months continued to pressure our net interest margin and as a result our earnings," Nash added. "We are encouraged that the bank was profitable for the period but for the additional provision to our loan loss reserve which we deemed appropriate given softening credit markets," Nash continued, "and Central Texas continues to perform relatively better than the larger state and national economies. Overall we're encouraged that actions taken to address our interest rate margin combined with reduced expenses have produced positive trends in our operating performance."

Forward-Looking Statements and Additional Information

All statements included in this release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of these safe harbor provisions.

Forward-looking statements are based on certain assumptions and describe future plans, strategies, and expectations of the Company. The Company's ability to predict results or the actual effects of its plans and strategies is inherently uncertain. Accordingly, actual results may differ materially from anticipated results. Factors that could cause actual results to differ materially from anticipated results include, among other things, the impact of competition, credit risk concentrations, interest rate fluctuations, governmental regulations and changes thereto, and economic conditions. All forward-looking statements in this release are made as of the date hereof, and you should not place undue reliance on these statements without also considering the risks and uncertainties associated with these statements and our business. The Company does not assume any obligation to update the forward-looking statements provided herein to reflect events that occur or circumstances that exist after the date hereof.

About Treaty Oak Bancorp, Inc.

Treaty Oak Bancorp, Inc. (TOAK) is the holding company parent of Treaty Oak Bank, a community bank with $136.0 million in total assets located at 101 Westlake Drive at Bee Caves Road in West Lake Hills. The holding company and bank were organized in the Austin area, where more than 90 percent of its shareholders reside. For more information contact Sheila Bostick at 512-617-3602 or [ sbostick@treatyoakbank.com ].