First Coweta Bank Announces Results for 6/30/2008

PRNewswire-FirstCall/ -- First Coweta Bank (BULLETIN BOARD: FCWT) based in Newnan, Georgia reports a net loss of ($1,330,414) or ($0.47) per share for the six month period ending June 30, 2008 vs. net income of $606,439 or $0.22 per share for the same period in 2007. Net interest income totaled $2,318,237 and $2,875,267 during the six month periods ending June 30, 2008 and June 30, 2007, respectively. Gross loans decreased over the first half of 2008 from $148.5 million at December 31, 2007 to $142.4 million at June 30, 2008. The bank had total assets of $167 million as of June 30, 2008, a decrease of 7% compared to December 31, 2007.

For the six month period ending June 30, 2008 the net loss was primarily due to an increase in non performing assets and "provision for loan loss" expense as well as compressed net interest margins. Non performing assets totaled $11.4 million and $1.3 million at June 30, 2008 and June 2007, respectively. The bank took provisions for loan loss of $500,000 and $1.6 million during the first and second quarters of 2008, respectively. Our resulting allowance for loan loss was approximately $3.7 million at June 30, 2008, which represented approximately 2.61% of total loans. Our interest margin for the first half of 2008 was 2.87% as compared to 4.75% for the same period in 2007. The reduction was caused by the declining interest rate environment since last fall and our elevated level of non performing assets. As of June 30, 2008, however, we continued to qualify as "well capitalized" under regulatory guidelines with a total capital ratio of 10.84%.

Mike Barber, President and Chief Executive Officer stated, "The loss during the first six months of 2008 was primarily from steps we took relating to the economic downturn and to cope with the real estate market specifically. Although actual charge-offs for the first half of 2008 were $523,875, the large addition of $2.1 million to our loan loss reserve reflects our commitment to provide for potential losses in our loan portfolio and to recognize these unusual economic conditions. Our Board of Directors, officers, and employees are committed to maintaining a sound financial institution during these difficult times. We will continue to monitor our loan quality and will make adjustments to our reserves as necessary to adequately cover any potential losses."

First Coweta Bank opened for business on July 12, 2004. The bank's stock is publicly traded over the counter under the symbol "FWCT." For further information, log on to our website at http://www.firstcowetabank.com/.

Forward-Looking Statements

This report contains "forward-looking statements" relating to, without limitation, future economic performance, plans and objectives of management for future operations, and projections of revenues and other financial items that are based on the beliefs of management, as well as assumptions made by and information currently available to management. The words "may," "will," "anticipate," "should," "would," "believe," "contemplate," "expect," "estimate," "continue," and "intend," as well as other similar words and expressions of the future, are intended to identify forward-looking statements.

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