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Provident Community Bancshares Reports Fourth Quarter Results

^{Published on 2011-02-04 16:27:03 - Market Wire}
 

ROCK HILL, S.C.--([ BUSINESS WIRE ])--Provident Community Bancshares, Inc. (NASDAQ CM: PCBS) (the aCorporationa) recorded a net loss to common shareholders of $10.4 million, or $5.80 (diluted) per share, for the three months ended December 31, 2010 as compared to a net loss to common shareholders of $4.6 million, or $2.58 per share (diluted), for the same period in 2009. Operating results for the current period were impacted by a $5.6 million charge for the recording of a valuation allowance for the write-down of the Corporationa™s deferred tax asset. Operating results were further impacted by an increase of $1.4 million in expenses related to the disposition of foreclosed properties, offset by lower charges for other than temporary impairment on securities. The net loss to common shareholders for the twelve months ended December 31, 2010 was $14.3 million, or $7.98 per share (diluted), compared to a net loss to common shareholders of $7.8 million or $4.34 per share (diluted), for the same period in 2009.

At December 31, 2010, assets totaled $408.7 million, a decrease of $48.3 million, or 10.6%, from $457.0 million at December 31, 2009. Investment securities decreased $3.3 million, or 2.2%, to $148.5 million at December 31, 2010 from $151.8 million at December 31, 2009 due to the sale of municipal securities. Fed funds sold increased $9.2 million to $14.5 million at December 31, 2010 from $5.3 million at December 31, 2009 as a result of the investment proceeds from sales and maturities of securities. Net loans receivable decreased $51.5 million, or 20.6%, to $198.9 million at December 31, 2010 as a result of lower demand and the tightening of credit standards. Deposits decreased $19.6 million to $313.1 million at December 31, 2010 as a result primarily of reductions in municipal deposits. FHLB advances and other borrowings decreased $13.5 million to $69.5 million at December 31, 2010 due primarily to the maturation of borrowings. Shareholdersa™ equity decreased $15.9 million, or 60.7%, to $10.3 million at December 31, 2010 from $26.1 million at December 31, 2009 due primarily to a net loss of $14.3 million and a $1.8 million increase in unrealized losses on securities available for sale.

Nonperforming loans, which are secured primarily by commercial real estate properties, were $18.8 million as of December 31, 2010, or 9.1% of total loans, as compared to $20.9 million at December 31, 2009, a decrease of $2.1 million. Other real estate owned increased $4.8 million to $10.7 million at December 31, 2010 from $5.9 million at December 31, 2009. Bad debt charge-offs, net of recoveries, were $7.3 million for the twelve months ended December 31, 2010 compared to $9.9 million for the same period in 2009. The downturn in the residential housing and commercial real estate market continues to be the primary factor leading to the deterioration in our loan portfolio.

Dwight V. Neese, President and CEO, said aWe continue to aggressively attack the issues caused by the current credit cycle. The increase in our loan loss provision from the third quarter was necessary to cover valuation issues on non-performing commercial real estate loans. We continue to take a very conservative approach on all aspects of managing our loan portfolio, especially collateral valuations. While we realize the financial sector has more challenges ahead, we believe the actions we have taken over the past several years in addressing risk management systems, loan review systems and technology improvements will enable us to better manage our loan portfolio.a

COMPANY INFORMATION

Provident Community Bancshares is the holding company for Provident Community Bank, N.A., which operates nine community oriented banking centers in the upstate of South Carolina that offer a full array of financial services. The Corporation is headquartered in Rock Hill, South Carolina and its common stock is traded on the NASDAQ Capital Market under the symbol PCBS. Please visit our website at [ www.providentonline.com ] or contact Wanda J. Wells, SVP/Shareholder Relations Officer at [ wwells@providentonline.com ] or Richard H. Flake, EVP/CFO at [ rflake@providentonline.com ].

FORWARD-LOOKING STATEMENTS

Certain matters set forth in this news release may contain forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements are typically identified by words such as abelieve,a aexpect,a aanticipate,a aintend,a aoutlook,a aestimate,a aforecast,a aprojecta and other similar words and expressions. Forward-looking statements are subject to numerous assumptions, risk and uncertainties, which may change over time. The Corporationa™s performance involves risks and uncertainties that may cause actual results to differ materially from those in such statements. For a discussion of certain factors that may cause such forward-looking statements to differ materially from the Corporationa™s actual results, see the Corporationa™s Annual Report in Form 10-K for the year ended December 31, 2009, including in the Risk Factors section of that report. Forward-looking statements speak only as of the date they are made. The Corporation does not assume any duty and does not undertake to update its forward-looking statements.

SUMMARY CONSOLIDATED FINANCIAL DATA

Our summary consolidated financial data as of and for the three and twelve months ended December 31, 2010, in the opinion of our management, contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly our financial position and results of operations for such periods in accordance with generally accepted accounting principles.