Attached files
| file | filename |
|---|---|
| 8-K - 8-K - UNIVEST FINANCIAL Corp | uvsp8-kearningsrelease93014.htm |
Exhibit 99.1
NEWS |  |
CONTACT: Mike Keim
UNIVEST CORPORATION OF PENNSYLVANIA
Chief Financial Officer
215-721-2511, keimm@univest.net
FOR IMMEDIATE RELEASE
UNIVEST CORPORATION OF PENNSYLVANIA - UNIVEST
BANK AND TRUST CO. - REPORTS THIRD QUARTER EARNINGS
SOUDERTON, Pa., October 22, 2014 - Univest Corporation of Pennsylvania (“Univest”) (NASDAQ: UVSP), parent company of Univest Bank and Trust Co. and its insurance, investments and equipment financing subsidiaries, today announced financial results for the quarter ended September 30, 2014. Univest reported net income of $6.2 million or $0.38 diluted earnings per share for the quarter ended September 30, 2014, a 3% increase from reported net income of $6.0 million or $0.36 diluted earnings per share for the quarter ended September 30, 2013. Net income for the nine months ended September 30, 2014 was $17.0 million or $1.04 diluted earnings per share, a 5% increase in net income compared to $16.3 million or $0.97 diluted earnings per share for the comparable period in the prior year. The year-to-date 2014 results include $739 thousand in acquisition-related costs or $0.03 diluted earnings per share on a tax affected basis.
Loans
Gross loans and leases increased $56.3 million or 4% from December 31, 2013 and $71.5 million or 5% from September 30, 2013. The growth in loans from December 31, 2013 and September 30, 2013 was primarily in municipal loans and leases, commercial real estate loans and residential real estate loans as economic conditions have slowly improved. While we are beginning to see increases in lending activity, consumer demand for loans remains sluggish. During the third quarter of 2014, the Corporation sold its credit card loan portfolio with a principal balance of $8.5 million for a pre-tax gain of $479 thousand. The sale of the credit card loan portfolio was completed due to our lack of scale necessary to justify the increased expense and focus associated with the increasing complexity of the risk management and compliance environment related to credit cards.
Deposits
Total deposits increased $15.6 million or 1% from December 31, 2013, primarily due to increases in non-interest bearing demand deposits and public funds which were partially offset by decreases in savings and time deposits. Total deposits decreased $28.9 million or 2% from September 30, 2013 mainly due to decreases in interest bearing deposit products partially offset by an increase in non-interest bearing deposits.
Net Interest Income and Margin
The net interest margin on a tax-equivalent basis for the third quarter of 2014 was 3.88%, compared to 3.86% for the second quarter of 2014 and 3.83% for the third quarter of 2013. Net interest income of $18.2 million for the third quarter of 2014 was consistent with the third quarter of 2013. Net interest income declined $437 thousand, or less than 1%, to $53.9 million for the nine months ended September 30, 2014, compared to the same period in the prior year. The decline in year-to-date net interest income from the prior year was primarily attributable to a reduction in investment securities. This decline was partially offset by the redemption of Univest’s trust preferred securities and the termination of the related interest rate swap during the second quarter of 2013, maturities of higher yielding time deposits and a decline in the rate paid on time deposits.
Non-Interest Income
Non-interest income for the quarter ended September 30, 2014 was $12.5 million, a decrease of $692 thousand or 5% from the comparable period in the prior year. Non-interest income for the nine months ended September 30, 2014 was $36.6 million, an increase of $907 thousand or 3% from the comparable period in the prior year. Investment advisory commission and fee income increased $1.3 million for the quarter and $3.5 million for the nine months ended September 30, 2014, primarily due to the acquisition of Girard Partners (“Girard”) effective January 1, 2014. Insurance commission and fee income increased $572 thousand for the quarter primarily due to the acquisition of Sterner Insurance ("Sterner") on July 1, 2014. Insurance commission and fee income increased $1.4 million for the nine months ended September 30, 2014, primarily due to the acquisition of Sterner, an increase in contingent income during the first quarter of 2014 and the acquisition of the John T. Fretz Insurance Agency on May 1, 2013. Other non-interest income included a gain on the sale of the credit card portfolio of $479 thousand. These favorable increases were offset in the third quarter and partially offset for the nine months ended September 30, 2014 by the following. The net gain on mortgage banking activities decreased $319 thousand for the quarter and $2.6 million for the nine months ended September 30, 2014. In 2014, higher interest rates have led to a continued decline in refinance activity while new home purchase activity remains sluggish. These factors led to a 25% decline in funded first mortgage volume for the third quarter of 2014 and a 63% decline for the nine months ended September 30, 2014, from the comparable periods in 2013. However, funded first mortgage volume during the third quarter of 2014 was up from the first and second quarters of 2014 due to an increase in purchase volume. The net gain on sales of securities decreased $1.4 million for the quarter and $2.4 million for the
nine months ended September 30, 2014 from the comparable periods in 2013. Excess proceeds from bank owned life insurance death benefits of $1.1 million were recognized during the third quarter of 2013. In addition, the nine months ended September 30, 2013 included a $1.9 million loss on the termination of an interest rate swap which was used as a hedge of trust preferred securities.
Non-Interest Expense
Non-interest expense for the quarter ended September 30, 2014 was $22.0 million, an increase of $2.0 million or 10% compared to the third quarter of 2013. Non-interest expense for the nine months ended September 30, 2014 was $64.7 million, an increase of $5.2 million or 9% from the comparable period in the prior year. Salaries and benefit expense increased $1.3 million for the quarter and $3.0 million for the nine months ended September 30, 2014, primarily attributable to the Girard and Sterner acquisitions and lower deferred loan origination costs. Intangible expenses increased by $2.0 million for the nine months ended September 30, 2014, mainly due to the Girard acquisition and the reduction to the contingent consideration liability related to the Javers acquisition which resulted in a reduction of expense of $959 thousand during the second quarter of 2013. Premises and equipment expenses increased $418 thousand for the quarter and $1.4 million for the nine months ended September 30, 2014, mainly due to increased costs related to computer equipment and software, our new leased office location in the Lehigh Valley which opened in December 2013 and the Girard acquisition. Acquisition-related costs for the nine months ended September 30, 2014 totaling $739 thousand were attributable to the pending Valley Green Bank acquisition and the completed acquisitions of Sterner and Girard. These unfavorable variances were partially offset by a decrease in commission expense of $944 thousand for the nine months ended September 30, 2014, mainly due to the decline in mortgage banking activity. In addition, non-interest expense during the first quarter of 2013 included restructuring charges of $539 thousand.
Asset Quality and Provision for Loan and Lease Losses
Non-accrual loans and leases, including non-accrual troubled debt restructured loans, decreased to $18.8 million at September 30, 2014, from $23.2 million at December 31, 2013 and $24.0 million at September 30, 2013. The $4.4 million decrease in non-accrual loans from December 31, 2013 was mainly due to sales, charge-offs, and pay-downs exceeding additions to non-accrual loans. Net loan and lease charge-offs were $2.6 million during the third quarter of 2014, down from $4.0 million for the third quarter of 2013. Non-accrual loans and leases as a percentage of total loans and leases held for investment were 1.18% at September 30, 2014, compared to 1.51% at December 31, 2013 and 1.57% at September 30, 2013.
Accruing troubled debt restructured loans decreased to $5.5 million at September 30, 2014 from $7.9 million at December 31, 2013 and $14.1 million at September 30, 2013. The decrease of $8.6 million from September 30, 2013 was primarily due to the payoff, in December 2013, of a large shared national commercial real estate credit with an outstanding principal balance of $5.8 million.
The provision for loan and lease losses was $233 thousand for the third quarter of 2014, down $3.9 million from the third quarter of 2013. The provision for loan and lease losses was $3.0 million for the nine months ended September 30, 2014, down $6.7 million from the same period in the prior year. The decreases in the loan and lease provision were mainly due to improvements in historical loss factors utilized to calculate the allowance for loan and lease loss requirement, a decline in collateral value for a commercial real estate borrower in the second quarter of 2013 and updated assessments of residential building lots for a commercial real estate developer in the third quarter of 2013.
The allowance for loan and lease losses as a percentage of loans and leases held for investment was 1.36% at September 30, 2014, compared to 1.59% at December 31, 2013 and 1.63% at September 30, 2013. The allowance for loan and lease losses to nonaccrual loans and leases held for investment equaled 115.67% at September 30, 2014, compared to 105.42% at December 31, 2013 and 103.59% at September 30, 2013.
Capital
Univest continues to remain well-capitalized at September 30, 2014. Total risk-based capital at September 30, 2014 was 13.19%, well in excess of the regulatory minimum for well-capitalized status of 10%.
Dividend
On August 15, 2014, Univest declared a quarterly cash dividend of $0.20 per share, payable on October 1, 2014. This represented a 4.26% annualized yield based on the closing price of Univest’s stock on the date the dividend was paid.
About Univest Corporation of Pennsylvania
Univest Corporation of Pennsylvania (UVSP), including its wholly-owned subsidiary, Univest Bank and Trust Co., has $2.2 billion in assets and more than $3.0 billion in assets under management and supervision through its Wealth Management lines of business. Headquartered in Souderton, Pa. and founded in 1876, the Corporation and its subsidiaries provide a full range of financial solutions for individuals, businesses, municipalities and nonprofit organizations in the Mid-Atlantic Region. Univest delivers these services through a network of more than 40 offices in southeastern Pennsylvania extending to the Lehigh Valley, Maryland and online at www.univest.net.
# # #
This press release of Univest Corporation of Pennsylvania and the reports Univest Corporation of Pennsylvania files with the Securities and Exchange Commission often contain "forward-looking statements" relating to present or future trends or factors affecting the financial services industry and, specifically, the financial operations, markets and products of Univest Corporation of Pennsylvania. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Univest Corporation of Pennsylvania’s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce net interest margins; (3) changes in prepayment speeds, loan sale volumes, charge-offs and loan loss provisions; (4) general economic conditions; (5) legislative or regulatory changes that may adversely affect the businesses in which Univest Corporation of Pennsylvania is engaged; (6) technological issues which may adversely affect Univest Corporation of Pennsylvania’s financial operations or customers; (7) changes in the securities markets or (8) risk factors mentioned in the reports and registration statements Univest Corporation of Pennsylvania files with the Securities and Exchange Commission. Univest Corporation of Pennsylvania undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.
Univest Corporation of Pennsylvania | |||||||||||||||||||||||||||
Consolidated Selected Financial Data | |||||||||||||||||||||||||||
September 30, 2014 | |||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||
Balance Sheet (Period End) | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | 9/30/2013 | ||||||||||||||||||||||
Assets | $ | 2,222,196 | $ | 2,197,252 | $ | 2,201,194 | $ | 2,191,559 | $ | 2,252,996 | |||||||||||||||||
Investment securities | 360,778 | 358,460 | 381,724 | 402,284 | 462,573 | ||||||||||||||||||||||
Loans held for sale | 2,156 | 9,811 | 1,856 | 2,267 | 3,489 | ||||||||||||||||||||||
Loans and leases held for investment, gross | 1,597,736 | 1,586,994 | 1,560,446 | 1,541,484 | 1,526,241 | ||||||||||||||||||||||
Allowance for loan and lease losses | 21,762 | 24,094 | 24,567 | 24,494 | 24,835 | ||||||||||||||||||||||
Loans and leases held for investment, net | 1,575,974 | 1,562,900 | 1,535,879 | 1,516,990 | 1,501,406 | ||||||||||||||||||||||
Total deposits | 1,860,143 | 1,832,234 | 1,839,760 | 1,844,498 | 1,889,046 | ||||||||||||||||||||||
Noninterest-bearing deposits | 436,189 | 432,399 | 426,430 | 411,714 | 394,983 | ||||||||||||||||||||||
NOW, money market and savings | 1,162,778 | 1,131,605 | 1,145,994 | 1,161,995 | 1,204,281 | ||||||||||||||||||||||
Time deposits | 261,176 | 268,230 | 267,336 | 270,789 | 289,782 | ||||||||||||||||||||||
Borrowings | 38,005 | 45,066 | 41,486 | 37,256 | 46,733 | ||||||||||||||||||||||
Shareholders' equity | 289,814 | 286,787 | 283,296 | 280,506 | 274,754 | ||||||||||||||||||||||
Balance Sheet (Average) | For the three months ended, | For the nine months ended, | |||||||||||||||||||||||||
9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | 9/30/2013 | 9/30/2014 | 9/30/2013 | |||||||||||||||||||||
Assets | $ | 2,217,474 | $ | 2,179,057 | $ | 2,172,551 | $ | 2,208,995 | $ | 2,233,124 | $ | 2,189,858 | $ | 2,238,914 | |||||||||||||
Investment securities | 360,274 | 376,970 | 390,630 | 447,672 | 479,442 | 375,847 | 490,479 | ||||||||||||||||||||
Loans and leases, gross | 1,597,965 | 1,566,293 | 1,550,346 | 1,527,330 | 1,506,850 | 1,571,709 | 1,489,818 | ||||||||||||||||||||
Deposits | 1,860,138 | 1,819,546 | 1,823,589 | 1,858,905 | 1,875,578 | 1,834,558 | 1,825,491 | ||||||||||||||||||||
Shareholders' equity | 288,429 | 285,489 | 282,574 | 275,983 | 280,245 | 285,518 | 283,412 | ||||||||||||||||||||
Asset Quality Data (Period End) | |||||||||||||||||||||||||||
9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | 9/30/2013 | |||||||||||||||||||||||
Nonaccrual loans and leases, including nonaccrual troubled debt restructured loans and leases and nonaccrual loans held for sale | $ | 18,814 | $ | 17,742 | $ | 19,287 | $ | 23,235 | $ | 23,974 | |||||||||||||||||
Accruing loans and leases 90 days or more past due | 344 | 524 | 581 | 413 | 1,954 | ||||||||||||||||||||||
Accruing troubled debt restructured loans and leases | 5,463 | 6,340 | 7,036 | 7,943 | 14,106 | ||||||||||||||||||||||
Other real estate owned | 955 | 1,650 | 1,650 | 1,650 | 1,650 | ||||||||||||||||||||||
Nonperforming assets | 25,576 | 26,256 | 28,554 | 33,241 | 41,684 | ||||||||||||||||||||||
Allowance for loan and lease losses | 21,762 | 24,094 | 24,567 | 24,494 | 24,835 | ||||||||||||||||||||||
Nonaccrual loans and leases / Loans and leases held for investment and nonaccrual loans held for sale | 1.18 | % | 1.12 | % | 1.24 | % | 1.51 | % | 1.57 | % | |||||||||||||||||
Nonperforming loans and leases / Loans and leases held for investment and nonaccrual loans held for sale | 1.54 | % | 1.55 | % | 1.72 | % | 2.05 | % | 2.62 | % | |||||||||||||||||
Allowance for loan and lease losses / Loans and leases held for investment | 1.36 | % | 1.52 | % | 1.57 | % | 1.59 | % | 1.63 | % | |||||||||||||||||
Allowance for loan and lease losses / Nonaccrual loans and leases held for investment | 115.67 | % | 140.00 | % | 127.38 | % | 105.42 | % | 103.59 | % | |||||||||||||||||
Allowance for loan and lease losses / Nonperforming loans and leases held for investment | 88.39 | % | 100.08 | % | 91.31 | % | 77.53 | % | 62.03 | % | |||||||||||||||||
For the three months ended, | For the nine months ended, | ||||||||||||||||||||||||||
9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | 9/30/2013 | 9/30/2014 | 9/30/2013 | |||||||||||||||||||||
Net loan and lease charge-offs | $ | 2,565 | $ | 1,724 | $ | 1,402 | $ | 1,955 | $ | 3,977 | $ | 5,691 | $ | 9,525 | |||||||||||||
Net loan and lease charge-offs (annualized)/Average loans and leases | 0.64 | % | 0.44 | % | 0.37 | % | 0.51 | % | 1.05 | % | 0.48 | % | 0.85 | % | |||||||||||||
Univest Corporation of Pennsylvania | |||||||||||||||||||||||||||
Consolidated Selected Financial Data | |||||||||||||||||||||||||||
September 30, 2014 | |||||||||||||||||||||||||||
(Dollars in thousands, except per share data) | |||||||||||||||||||||||||||
For the three months ended, | For the nine months ended, | ||||||||||||||||||||||||||
For the period: | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | 9/30/2013 | 9/30/2014 | 9/30/2013 | ||||||||||||||||||||
Interest income | $ | 19,219 | $ | 18,725 | $ | 18,946 | $ | 19,172 | $ | 19,457 | $ | 56,890 | $ | 58,407 | |||||||||||||
Interest expense | 978 | 981 | 998 | 1,080 | 1,138 | 2,957 | 4,037 | ||||||||||||||||||||
Net interest income | 18,241 | 17,744 | 17,948 | 18,092 | 18,319 | 53,933 | 54,370 | ||||||||||||||||||||
Provision for loan and lease losses | 233 | 1,251 | 1,475 | 1,614 | 4,094 | 2,959 | 9,614 | ||||||||||||||||||||
Net interest income after provision | 18,008 | 16,493 | 16,473 | 16,478 | 14,225 | 50,974 | 44,756 | ||||||||||||||||||||
Noninterest income: | |||||||||||||||||||||||||||
Trust fee income | 1,862 | 1,931 | 1,899 | 2,054 | 1,736 | 5,692 | 5,249 | ||||||||||||||||||||
Service charges on deposit accounts | 1,073 | 1,047 | 1,014 | 1,118 | 1,149 | 3,134 | 3,333 | ||||||||||||||||||||
Investment advisory commission and fee income | 3,086 | 3,009 | 3,049 | 1,988 | 1,740 | 9,144 | 5,654 | ||||||||||||||||||||
Insurance commission and fee income | 2,881 | 2,434 | 3,332 | 2,172 | 2,309 | 8,647 | 7,223 | ||||||||||||||||||||
Bank owned life insurance income | 346 | 443 | 378 | 496 | 1,555 | 1,167 | 2,472 | ||||||||||||||||||||
Net gain on sales of investment securities | — | 415 | 142 | 439 | 1,426 | 557 | 2,950 | ||||||||||||||||||||
Net gain on mortgage banking activities | 616 | 519 | 349 | 476 | 935 | 1,484 | 4,047 | ||||||||||||||||||||
Net gain on sales of other real estate owned | 195 | — | — | 176 | 198 | 195 | 450 | ||||||||||||||||||||
Loss on termination of interest rate swap | — | — | — | — | — | — | (1,866 | ) | |||||||||||||||||||
Other income | 2,451 | 2,126 | 1,978 | 2,197 | 2,154 | 6,555 | 6,156 | ||||||||||||||||||||
Total noninterest income | 12,510 | 11,924 | 12,141 | 11,116 | 13,202 | 36,575 | 35,668 | ||||||||||||||||||||
Noninterest expense: | |||||||||||||||||||||||||||
Salaries and benefits | 11,035 | 10,242 | 10,671 | 10,542 | 9,761 | 31,948 | 28,980 | ||||||||||||||||||||
Commissions | 2,200 | 1,795 | 1,590 | 1,983 | 2,026 | 5,585 | 6,529 | ||||||||||||||||||||
Premises and equipment | 3,115 | 3,097 | 3,088 | 2,836 | 2,697 | 9,300 | 7,898 | ||||||||||||||||||||
Professional fees | 744 | 846 | 809 | 1,131 | 764 | 2,399 | 2,340 | ||||||||||||||||||||
Acquisition-related costs | 180 | 516 | 43 | 53 | 7 | 739 | 34 | ||||||||||||||||||||
Intangible expenses | 352 | 650 | 760 | 356 | 275 | 1,762 | (199 | ) | |||||||||||||||||||
Restructuring charges | 8 | — | — | — | (5 | ) | 8 | 534 | |||||||||||||||||||
Other expense | 4,385 | 4,644 | 3,922 | 4,722 | 4,463 | 12,951 | 13,394 | ||||||||||||||||||||
Total noninterest expense | 22,019 | 21,790 | 20,883 | 21,623 | 19,988 | 64,692 | 59,510 | ||||||||||||||||||||
Income before taxes | 8,499 | 6,627 | 7,731 | 5,971 | 7,439 | 22,857 | 20,914 | ||||||||||||||||||||
Income taxes | 2,264 | 1,547 | 2,005 | 1,049 | 1,400 | 5,816 | 4,647 | ||||||||||||||||||||
Net income | $ | 6,235 | $ | 5,080 | $ | 5,726 | $ | 4,922 | $ | 6,039 | $ | 17,041 | $ | 16,267 | |||||||||||||
Per common share data: | |||||||||||||||||||||||||||
Book value per share | $ | 17.87 | $ | 17.65 | $ | 17.43 | $ | 17.22 | $ | 16.87 | $ | 17.87 | $ | 16.87 | |||||||||||||
Net income per share: | |||||||||||||||||||||||||||
Basic | $ | 0.38 | $ | 0.31 | $ | 0.35 | $ | 0.30 | $ | 0.36 | $ | 1.05 | $ | 0.97 | |||||||||||||
Diluted | $ | 0.38 | $ | 0.31 | $ | 0.35 | $ | 0.30 | $ | 0.36 | $ | 1.04 | $ | 0.97 | |||||||||||||
Dividends declared per share | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.60 | $ | 0.60 | |||||||||||||
Weighted average shares outstanding | 16,225,596 | 16,243,161 | 16,256,047 | 16,283,466 | 16,657,916 | 16,241,490 | 16,713,666 | ||||||||||||||||||||
Period end shares outstanding | 16,220,249 | 16,248,495 | 16,249,152 | 16,287,812 | 16,288,597 | 16,220,249 | 16,288,597 | ||||||||||||||||||||
Univest Corporation of Pennsylvania | ||||||||||||||||||||
Consolidated Selected Financial Data | ||||||||||||||||||||
September 30, 2014 | ||||||||||||||||||||
For the three months ended, | For the nine months ended, | |||||||||||||||||||
Profitability Ratios (annualized) | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | 9/30/2013 | 9/30/2014 | 9/30/2013 | |||||||||||||
Return on average assets | 1.12 | % | 0.94 | % | 1.07 | % | 0.88 | % | 1.07 | % | 1.04 | % | 0.97 | % | ||||||
Return on average shareholders' equity | 8.58 | % | 7.14 | % | 8.22 | % | 7.08 | % | 8.55 | % | 7.98 | % | 7.67 | % | ||||||
Net interest margin (FTE) | 3.88 | % | 3.86 | % | 3.96 | % | 3.82 | % | 3.83 | % | 3.90 | % | 3.81 | % | ||||||
Efficiency ratio (1) | 68.39 | % | 70.00 | % | 66.19 | % | 70.43 | % | 59.53 | % | 68.19 | % | 62.70 | % | ||||||
Efficiency ratio (1), excluding acquisition-related costs and restructuring charges | 67.81 | % | 68.34 | % | 66.06 | % | 70.25 | % | 59.53 | % | 67.40 | % | 62.10 | % | ||||||
Capitalization Ratios | ||||||||||||||||||||
Dividends declared to net income | 52.01 | % | 63.96 | % | 56.72 | % | 66.17 | % | 55.24 | % | 57.16 | % | 61.65 | % | ||||||
Shareholders' equity to assets (Period End) | 13.04 | % | 13.05 | % | 12.87 | % | 12.80 | % | 12.20 | % | 13.04 | % | 12.20 | % | ||||||
Tangible common equity to tangible assets | 9.78 | % | 9.94 | % | 9.74 | % | 10.10 | % | 9.55 | % | 9.78 | % | 9.55 | % | ||||||
Regulatory Capital Ratios (Period End) | ||||||||||||||||||||
Tier 1 leverage ratio | 10.50 | % | 10.72 | % | 10.64 | % | 10.85 | % | 10.63 | % | 10.50 | % | 10.63 | % | ||||||
Tier 1 risk-based capital ratio | 11.99 | % | 12.00 | % | 12.00 | % | 12.63 | % | 12.47 | % | 11.99 | % | 12.47 | % | ||||||
Total risk-based capital ratio | 13.19 | % | 13.26 | % | 13.27 | % | 13.90 | % | 13.73 | % | 13.19 | % | 13.73 | % | ||||||
(1) Total operating expenses to net interest income before loan loss provision plus non-interest income adjusted for tax equivalent income. | ||||||||||||||||||||
Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates and Interest Differential | |||||||||||||||||||||||
For the Three Months Ended September 30, | |||||||||||||||||||||||
Tax Equivalent Basis | 2014 | 2013 | |||||||||||||||||||||
Average | Income/ | Average | Average | Income/ | Average | ||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||||
Assets: | |||||||||||||||||||||||
Interest-earning deposits with other banks | $ | 34,701 | $ | 18 | 0.21 | % | $ | 36,137 | $ | 25 | 0.27 | % | |||||||||||
U.S. government obligations | 127,505 | 320 | 1.00 | 175,753 | 484 | 1.09 | |||||||||||||||||
Obligations of state and political subdivisions | 107,039 | 1,360 | 5.04 | 117,166 | 1,589 | 5.38 | |||||||||||||||||
Other debt and equity securities | 125,730 | 643 | 2.03 | 186,523 | 907 | 1.93 | |||||||||||||||||
Total interest-earning deposits and investments | 394,975 | 2,341 | 2.35 | 515,579 | 3,005 | 2.31 | |||||||||||||||||
Commercial, financial, and agricultural loans | 394,297 | 4,054 | 4.08 | 395,251 | 4,062 | 4.08 | |||||||||||||||||
Real estate—commercial and construction loans | 622,249 | 7,105 | 4.53 | 590,967 | 7,071 | 4.75 | |||||||||||||||||
Real estate—residential loans | 298,530 | 2,684 | 3.57 | 261,586 | 2,463 | 3.74 | |||||||||||||||||
Loans to individuals | 30,616 | 492 | 6.38 | 42,483 | 587 | 5.48 | |||||||||||||||||
Municipal loans and leases | 181,170 | 2,214 | 4.85 | 147,505 | 1,875 | 5.04 | |||||||||||||||||
Lease financings | 71,103 | 1,586 | 8.85 | 69,058 | 1,610 | 9.25 | |||||||||||||||||
Gross loans and leases | 1,597,965 | 18,135 | 4.50 | 1,506,850 | 17,668 | 4.65 | |||||||||||||||||
Total interest-earning assets | 1,992,940 | 20,476 | 4.08 | 2,022,429 | 20,673 | 4.06 | |||||||||||||||||
Cash and due from banks | 36,600 | 34,693 | |||||||||||||||||||||
Reserve for loan and lease losses | (24,450 | ) | (25,404 | ) | |||||||||||||||||||
Premises and equipment, net | 35,580 | 33,157 | |||||||||||||||||||||
Other assets | 176,804 | 168,249 | |||||||||||||||||||||
Total assets | $ | 2,217,474 | $ | 2,233,124 | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Interest-bearing checking deposits | $ | 316,923 | $ | 44 | 0.06 | $ | 323,165 | $ | 46 | 0.06 | |||||||||||||
Money market savings | 290,194 | 79 | 0.11 | 306,937 | 73 | 0.09 | |||||||||||||||||
Regular savings | 537,175 | 80 | 0.06 | 545,134 | 80 | 0.06 | |||||||||||||||||
Time deposits | 265,293 | 768 | 1.15 | 294,844 | 920 | 1.24 | |||||||||||||||||
Total time and interest-bearing deposits | 1,409,585 | 971 | 0.27 | 1,470,080 | 1,119 | 0.30 | |||||||||||||||||
Short-term borrowings | 38,763 | 7 | 0.07 | 44,516 | 8 | 0.07 | |||||||||||||||||
Subordinated notes and capital securities | — | — | — | 1,569 | 11 | 2.78 | |||||||||||||||||
Total borrowings | 38,763 | 7 | 0.07 | 46,085 | 19 | 0.16 | |||||||||||||||||
Total interest-bearing liabilities | 1,448,348 | 978 | 0.27 | 1,516,165 | 1,138 | 0.30 | |||||||||||||||||
Noninterest-bearing deposits | 450,553 | 405,498 | |||||||||||||||||||||
Accrued expenses and other liabilities | 30,144 | 31,216 | |||||||||||||||||||||
Total liabilities | 1,929,045 | 1,952,879 | |||||||||||||||||||||
Shareholders' Equity: | |||||||||||||||||||||||
Common stock | 91,332 | 91,332 | |||||||||||||||||||||
Additional paid-in capital | 65,459 | 64,866 | |||||||||||||||||||||
Retained earnings and other equity | 131,638 | 124,047 | |||||||||||||||||||||
Total shareholders' equity | 288,429 | 280,245 | |||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 2,217,474 | $ | 2,233,124 | |||||||||||||||||||
Net interest income | $ | 19,498 | $ | 19,535 | |||||||||||||||||||
Net interest spread | 3.81 | 3.76 | |||||||||||||||||||||
Effect of net interest-free funding sources | 0.07 | 0.07 | |||||||||||||||||||||
Net interest margin | 3.88 | % | 3.83 | % | |||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 137.60 | % | 133.39 | % | |||||||||||||||||||
Notes: For rate calculation purposes, average loan and lease categories include unearned discount. | |||||||||||||||||||||||
Nonaccrual loans and leases have been included in the average loan and lease balances. | |||||||||||||||||||||||
Loans held for sale have been included in the average loan balances. | |||||||||||||||||||||||
Tax-equivalent amounts for the three months ended September 30, 2014 and 2013 have been calculated using the Corporation’s federal applicable rate of 35.0%. | |||||||||||||||||||||||
Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates and Interest Differential | |||||||||||||||||||||||
For the Nine Months Ended September 30, | |||||||||||||||||||||||
Tax Equivalent Basis | 2014 | 2013 | |||||||||||||||||||||
Average | Income/ | Average | Average | Income/ | Average | ||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||||
Assets: | |||||||||||||||||||||||
Interest-earning deposits with other banks | $ | 28,457 | $ | 49 | 0.23 | % | $ | 51,880 | $ | 106 | 0.27 | % | |||||||||||
U.S. government obligations | 128,799 | 967 | 1.00 | 176,095 | 1,449 | 1.10 | |||||||||||||||||
Obligations of state and political subdivisions | 107,269 | 4,189 | 5.22 | 120,435 | 4,774 | 5.30 | |||||||||||||||||
Other debt and equity securities | 139,779 | 2,058 | 1.97 | 193,949 | 2,746 | 1.89 | |||||||||||||||||
Total interest-earning deposits and investments | 404,304 | 7,263 | 2.40 | 542,359 | 9,075 | 2.24 | |||||||||||||||||
Commercial, financial, and agricultural loans | 396,915 | 11,925 | 4.02 | 412,233 | 13,093 | 4.25 | |||||||||||||||||
Real estate—commercial and construction loans | 602,862 | 20,791 | 4.61 | 570,209 | 20,575 | 4.82 | |||||||||||||||||
Real estate—residential loans | 288,548 | 7,766 | 3.60 | 257,170 | 7,354 | 3.82 | |||||||||||||||||
Loans to individuals | 34,981 | 1,627 | 6.22 | 42,519 | 1,784 | 5.61 | |||||||||||||||||
Municipal loans and leases | 177,446 | 6,447 | 4.86 | 139,827 | 5,334 | 5.10 | |||||||||||||||||
Lease financings | 70,957 | 4,807 | 9.06 | 67,860 | 4,738 | 9.33 | |||||||||||||||||
Gross loans and leases | 1,571,709 | 53,363 | 4.54 | 1,489,818 | 52,878 | 4.75 | |||||||||||||||||
Total interest-earning assets | 1,976,013 | 60,626 | 4.10 | 2,032,177 | 61,953 | 4.08 | |||||||||||||||||
Cash and due from banks | 32,564 | 33,092 | |||||||||||||||||||||
Reserve for loan and lease losses | (24,951 | ) | (25,627 | ) | |||||||||||||||||||
Premises and equipment, net | 34,733 | 32,938 | |||||||||||||||||||||
Other assets | 171,499 | 166,334 | |||||||||||||||||||||
Total assets | $ | 2,189,858 | $ | 2,238,914 | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Interest-bearing checking deposits | $ | 314,095 | $ | 129 | 0.05 | $ | 277,673 | $ | 119 | 0.06 | |||||||||||||
Money market savings | 286,667 | 214 | 0.10 | 318,406 | 231 | 0.10 | |||||||||||||||||
Regular savings | 539,248 | 238 | 0.06 | 538,764 | 234 | 0.06 | |||||||||||||||||
Time deposits | 267,271 | 2,351 | 1.18 | 307,134 | 2,930 | 1.28 | |||||||||||||||||
Total time and interest-bearing deposits | 1,407,281 | 2,932 | 0.28 | 1,441,977 | 3,514 | 0.33 | |||||||||||||||||
Short-term borrowings | 41,271 | 25 | 0.08 | 82,318 | 40 | 0.06 | |||||||||||||||||
Subordinated notes and capital securities | — | — | — | 14,319 | 483 | 4.51 | |||||||||||||||||
Total borrowings | 41,271 | 25 | 0.08 | 96,637 | 523 | 0.72 | |||||||||||||||||
Total interest-bearing liabilities | 1,448,552 | 2,957 | 0.27 | 1,538,614 | 4,037 | 0.35 | |||||||||||||||||
Noninterest-bearing deposits | 427,277 | 383,514 | |||||||||||||||||||||
Accrued expenses and other liabilities | 28,511 | 33,374 | |||||||||||||||||||||
Total liabilities | 1,904,340 | 1,955,502 | |||||||||||||||||||||
Shareholders' Equity: | |||||||||||||||||||||||
Common stock | 91,332 | 91,332 | |||||||||||||||||||||
Additional paid-in capital | 65,366 | 64,756 | |||||||||||||||||||||
Retained earnings and other equity | 128,820 | 127,324 | |||||||||||||||||||||
Total shareholders' equity | 285,518 | 283,412 | |||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 2,189,858 | $ | 2,238,914 | |||||||||||||||||||
Net interest income | $ | 57,669 | $ | 57,916 | |||||||||||||||||||
Net interest spread | 3.83 | 3.73 | |||||||||||||||||||||
Effect of net interest-free funding sources | 0.07 | 0.08 | |||||||||||||||||||||
Net interest margin | 3.90 | % | 3.81 | % | |||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 136.41 | % | 132.08 | % | |||||||||||||||||||
Notes: For rate calculation purposes, average loan and lease categories include unearned discount. | |||||||||||||||||||||||
Nonaccrual loans and leases have been included in the average loan and lease balances. | |||||||||||||||||||||||
Loans held for sale have been included in the average loan balances. | |||||||||||||||||||||||
Tax-equivalent amounts for the nine months ended September 30, 2014 and 2013 have been calculated using the Corporation’s federal applicable rate of 35.0%. | |||||||||||||||||||||||