ServisFirst Bancshares
Annual Report 2008

Plain-text annual report

Our Name is Our Mission 2008 ANNUAL REPORT Dear Shareholders, I am pleased, but never satisfied, with our financial performance in 2008. ServisFirst Bancshares, Inc. had net income of $7.0 million in 2008, an increase of 27% over 2007. We achieved these results while continuing to focus on the improvement in profitability of our three newest markets; Huntsville, Montgomery and Dothan. We are pleased to welcome our new Dothan shareholders, and we are encouraged by the reception in the Houston County market. Ronald DeVane, our Dothan Regional CEO, has done a remarkable job in assembling our Dothan directors, officers and shareholders. Our deposits grew by 36% in 2008, and we are particularly proud of the fact that we have no brokered deposits. Regulators have recently concluded that banks with a heavy reliance on brokered deposits are more likely to have financial problems than banks that do not, which is not surprising to me. We all read daily about the banking industry problems, which are real problems for our economy and the American taxpayer. Most of the problems are centered in our largest banks and the thrift industry. The thrift industry focused almost completely on residential construction and development, which has faced enormous problems. There is not an easy solution to the housing problem and the taxpayers will pay for it. We are fortunate to be in markets where housing is not as bad as the high growth areas of the United States. The key to long-term success in this industry is to have a diversified loan portfolio coupled with a focus on building core deposits. We will always keep a simple strategy, which is to build strong relationships with our customers. Our best relationships come from referrals from our shareholders and customers. We appreciate all your help and support. We are well positioned to profit from the turbulence in our industry and can achieve much success with hard work and dedication. Sincerely, Thomas A. Broughton III President and Chief Executive Officer 1 CONSOLIDATED FINANCIAL HIGHLIGHTS As of and for the years ended December 31, (Dollars in thousands except for share data) 2008 2007 SELECTED ASSET DATA Cash and cash equivalents Securities available for sale Loans, net Other real estate owned Total assets Noninterest-bearing liabilities Interest bearing liabilities Total liabilities Total shareholders’ equity SELECTED INCOME DATA Interest income Interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses Non-interest income Non-interest expense Income (loss) before income taxes Provision for income taxes Net income Basic earnings per share Diluted earnings per share SELECTED PERFORMANCE RATIOS Return on average assets Return on average stockholders' equity Net interest margin(1) Efficiency ratio(2) LIQUIDITY RATIOS Net loans to total deposits Net average loans to average earning assets Non-interest-bearing deposits to total deposits CAPITAL ADEQUACY RATIOS Stockholders' equity to total assets(3) Total risked-based capital(4) Tier I capital(5) Leverage ratio(6) GROWTH RATIOS Percentage change in net income Percentage changed in diluted net income per share Percentage change in assets Percentage change in net loans Percentage change in deposits Percentage change in equity $ 72,918 102,339 957,631 10,473 1,162,272 121,459 915,860 1,075,489 86,783 $ 55,450 20,474 34,976 6,274 28,702 2,704 20,576 10,830 3,825 7,005 1.37 1.31 0.71% 0.28% 3.70% 54.61% 92.32% 85.84% 11.71% 7.38% 11.25% 10.18% 9.01% 27.43% 12.93% 38.65% 45.45% 36.00% 20.12% $ 66,422 87,233 667,549 1,623 838,250 85,018 677,665 766,003 72,247 $ 51,417 25,872 25,545 3,541 22,004 1,441 14,796 8,649 3,152 5,497 1.19 1.16 0.78% 9.40% 3.78% 54.83% 87.53% 77.19% 11.15% 8.50% 11.22% 10.12% 8.40% 35.00% 13.21% 58.59% 53.43% 61.13% 38.18% _____________________________ (1) Net interest margin is the net yield on interest earning assets and is the difference between the interest yield earned on interest-earning assets and interest rate paid on interest-bearing liabilities, divided by average earning assets. Efficiency ratio is the result of non-interest expense divided by the sum of net interest income and non-interest income. Total stockholders' equity excluding unrealized losses on securities available for sale, net of taxes, divided by total assets. Total stockholders' equity excluding unrealized losses on securities available for sale, net of taxes, and intangible assets plus allowance for loan losses (limited to 1.25% of risk-weighted assets) divided by total risk-weighted assets. The FDIC required minimum to be well-capitalized is 10%. Total stockholders' equity excluding unrealized losses on securities available for sale, net of taxes, and intangible assets divided by total risk-weighted assets. The FDIC required minimum to be well-capitalized is 6%. Total stockholders' equity excluding unrealized losses on securities available for sale, net of taxes, and intangible assets divided by average assets less intangible assets. The FDIC required minimum to be well-capitalized is 5%; however, the Alabama Banking Department has required that the Bank maintain a Tier 1 capital leverage ratio of 7%. (2) (3) (4) (5) (6) 2 OFFICERS AND DIRECTORS PRINCIPAL OFFICERS: SERVISFIRST BANCSHARES, INC. Thomas A. Broughton III Chief Executive Officer and President William M. Foshee Executive Vice President, Chief Financial Officer, Treasurer and Secretary Clarence C. Pouncey III Executive Vice President and Chief Operating Officer PRINCIPAL OFFICERS: SERVISFIRST BANK Thomas A. Broughton III Chief Executive Officer and President Clarence C. Pouncey III Executive Vice President and Chief Operating Officer G. Carlton Barker Executive Vice President and Montgomery Regional CEO Ronald A. DeVane Executive Vice President and Dothan Regional CEO William M. Foshee Executive Vice President, Chief Financial Officer, Treasurer and Secretary Andrew N. Kattos Executive Vice President and Huntsville Regional CEO BOARD OF DIRECTORS: SERVISFIRST BANCSHARES, INC. Stanley M. Brock, Chairman of the Board Birmingham, Alabama Thomas A. Broughton III Birmingham, Alabama Joseph R. Cashio Birmingham, Alabama James J. Filler Birmingham, Alabama Michael D. Fuller Birmingham, Alabama Hatton C. V. Smith Birmingham, Alabama SERVISFIRST BANCSHARES, INC. COMMITTEES NOMINATING AND CORPORATE GOVERNANCE Stanley M. Brock Joseph R. Cashio Michael D. Fuller AUDIT Michael D. Fuller Joseph R. Cashio Stanley M. Brock COMPENSATION Hatton C.V. Smith Joseph R. Cashio James J. Filler 3 OFFICES AND LOCATIONS CORPORATE OFFICES 3300 CAHABA ROAD, SUITE 300 BIRMINGHAM, ALABAMA 35223 205.949.0302 MAIN OFFICE BANKING CENTER 3300 CAHABA ROAD, SUITE 105 BIRMINGHAM, ALABAMA 35223 205.949.0345 DOWNTOWN BANKING CENTER 324 RICHARD ARRINGTON JR. BLVD. NORTH BIRMINGHAM, ALABAMA 35203 205.949.2200 GREYSTONE BANKING CENTER 5403 HIGHWAY 280, SUITE 401 BIRMINGHAM, ALABAMA 35242 205.949.0870 DOTHAN CORPORATE OFFICE & BANKING CENTER 256 HONEYSUCKLE ROAD BRIGHTLEAF COURT, SUITE 12 DOTHAN, AL 36305 334.340.4300 HUNTSVILLE CORPORATE OFFICE & DOWNTOWN BANKING CENTER 401 MERIDIAN STREET, SUITE 100 HUNTSVILLE, ALABAMA 35801 256.722.7800 PROVIDENCE BANKING CENTER 475 PROVIDENCE MAIN STREET, SUITE 401 HUNTSVILLE, ALABAMA 35806 256.722.7880 CORPORATE OFFICE & DOWNTOWN BANKING CENTER ONE COMMERCE STREET, SUITE 200 MONTGOMERY, ALABAMA 36104 334.223.5800 MONTGOMERY EAST BANKING CENTER 8117 VAUGHN ROAD, UNIT 20 MONTGOMERY, ALABAMA 36116 334.223.5600 4 STOCKHOLDER INFORMATION these reports. You may also obtain a copy of any such report free of charge from us by requesting such copy in writing to 3300 Cahaba Road, Suite 300, Birmingham, Alabama 35223, Attn.: Investor Relations. This annual report and accompanying exhibits and all other reports and filings that we file with the SEC will be available for the public to view and copy (at prescribed rates) at the SEC’s Public Reference Room at 100 F Street, Washington, D.C. 20549. You may also obtain copies of such information at the prescribed rates from the SEC’s Public Reference Room by calling the SEC at 1-800- SEC-0330. The SEC also maintains a website and that information statements and other information as we file electronically with the SEC by clicking on http://www.sec.gov. reports, proxy contains such INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Mauldin & Jenkins, LLC 2000 Southbridge Parkway Birmingham, Alabama 35209 (205) 445-2880 SECURITIES COUNSEL Haskell Slaughter Young & Rediker, LLC 1400 Park Place Tower 2001 Park Place North Birmingham, AL 35203 (205) 251-1000 ANNUAL MEETING The Annual Meeting of Stockholders of ServisFirst Bancshares, Inc. will be held at Vulcan Park Center located at 1701 Valley View Drive, Birmingham, Alabama 35209 on Thursday, May 28, 2009, at 5:00 p.m., C.D.T. FORM 10-K Form 10-K is ServisFirst Bancshares, Inc.’s annual report filed with the Securities and Exchange Commission, and is included within this document. A copy of ServisFirst Bancshares, Inc.’s 10-K may be obtained, free of charge, if you address a written request to our Secretary, William M. Foshee, 3300 Cahaba Road, Suite 300, Birmingham, Alabama 35223. TRANSFER AGENT Registrar and Transfer Company 10 Commerce Drive Cranford, NJ 07016 AVAILABLE INFORMATION Our website corporate is www.servisfirstbank.com. We have direct links on this website to our Code of Ethics and the charters for our Audit, Compensation and and Nominations Corporate Governance Committees by clicking on the “Investor Relations” tab. We also have direct links to our filings with the Securities and Exchange Commission (SEC), including, but not limited to, our first annual report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and any amendments to ServisFirst Bancshares, Inc. 3300 Cahaba Road Suite 300 Birmingham, AL 35223 Toll Free: 866.317.0810 www.servisfirstbank.com Our Name is Our Mission 

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