pab bankshares, inc. - SNL Financial

GAAP Reconciliation and Management Explanation for Non-GAAP Financial Measures
Certain financial information included in “Selected Financial Data” above is determined by methods other than in
accordance with GAAP. “Tangible book value per share” is a non-GAAP financial measure that our management uses in
its analysis of our performance.
“Tangible book value” is defined as total equity reduced by recorded intangible assets divided by total common shares
outstanding. This measure is important to investors interested in changes from period to period in book value per share
exclusive of changes in intangible assets. Goodwill, an intangible asset that is recorded in a purchase business
combination, has the effect of increasing total book value while not increasing the tangible assets of the company. For
companies that have engaged in multiple business combinations, purchase accounting can result in the recording of
significant amounts of goodwill related to such transactions.
These disclosures should not be viewed as a substitute for results determined in accordance with GAAP, and are not
necessarily comparable to non-GAAP performance measures which may be presented by other companies. The following
reconciliation table provides a more detailed analysis of these non-GAAP performance measures.
2009 2008 2007 2006 2005
Book value per common share** $ 3.67 $ 9.82 $ 10.38 $ 9.84 $ 9.01
Effect of intangible assets per share** - 0.64 0.63 0.62 0.62
Tangible book value per common share** $ 3.67 $ 9.18 $ 9.75 $ 9.22 $ 8.39
**2007 and prior periods adjusted for 2% stock dividend paid on July 15, 2008.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion and analysis of the consolidated financial condition and results of operations of PAB should be
read in conjunction with the Consolidated Financial Statements and related Notes, and is qualified in its entirety by the
foregoing and other more detailed financial information appearing elsewhere. Historical results of operations and the
percentage relationships among any amounts included, and any trends which may appear to be inferred, should not be
taken as being necessarily indicative of trends in operations or results of operations for any future periods.
We have made, and will continue to make, various forward-looking statements with respect to financial and business
matters. Comments regarding our business which are not historical facts are considered forward-looking statements that
involve inherent risks and uncertainties. Actual results may differ materially from those contained in these forwardlooking
statements. For additional information regarding our cautionary disclosures, see the “Cautionary Notice
Regarding Forward-Looking Statements” at the beginning of this Report.
OVERVIEW OF KEY FINANCIAL, STRATEGIC AND PERFORMANCE FACTORS
PAB Bankshares, Inc. is a bank holding company headquartered in Valdosta, Georgia. Our company was organized and
incorporated in 1982 under the laws of the State of Georgia as the holding company for The Park Avenue Bank, a state
chartered bank that was founded in 1956. We have a tradition of community banking in South Georgia spanning more
than five decades. In 2000, we expanded into higher growth metropolitan markets in North Georgia and Florida to
leverage the excess deposits of our South Georgia franchise. Currently, the Bank operates with 13 branches located in
seven counties in South Georgia, where we have developed a leading market share in several of these communities; four
branches located in three counties in North Georgia; and one branch located in Ocala, Florida. We provide traditional
banking products and services to both commercial and individual customers in our markets. For additional information on
our markets, see the “Markets and Competition” section in Part I of this Report. As a bank, we operate in a highly
regulated and competitive environment. Our primary objective is to increase the return on our stockholders’ investment
over the long-term by accepting deposits and borrowing additional funds as needed at low costs and investing those funds
in a safe and sound manner in loans and investments at a higher yield. Competition, regulation, credit risk, and interest
rate risk are the primary factors that we must manage in order to be successful.
As described in the “Supervision and Regulation” section in Part I of this Report, we have been operating under a Written
Agreement with the Federal Reserve and the Georgia Department since July 14, 2009.
27