UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (Date of earliest event reported): January 27, 2011
Commission File Number 0-17071
FIRST MERCHANTS CORPORATION
(Exact name of registrant as specified in its charter)
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INDIANA
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35-1544218
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(State or other jurisdiction of incorporation)
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(IRS Employer Identification No.)
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200 East Jackson Street
P.O. Box 792
Muncie, IN 47305-2814
(Address of principal executive offices, including zip code)
(765) 747-1500
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On January 27, 2011 First Merchants Corporation issued a press release to report its financial results for the fourth quarter ended December 31, 2010. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information in this Current Report on Form 8-K, including Exhibit No. 99.1 hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability of that section. The information in this Current Report shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
Exhibit 99.1 Press Release, dated January 27, 2011, issued by First Merchants Corporation
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
First Merchants Corporation
(Registrant)
By: /s/ Mark K. Hardwick
Mark K. Hardwick
Executive Vice President and Chief Financial Officer
(Principal Financial and Principal Accounting Officer)
Dated: January 27, 2011
EXHIBIT INDEX
Exhibit No. Description
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99.1
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Press Release, dated January 27, 2011, issued by First Merchants Corporation
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N / E / W / S R / E / L / E / A / S / E
January 27, 2011
FOR IMMEDIATE RELEASE
For more information, contact:
David L. Ortega, First Vice President/Director of Investor Relations
765-378-8937
http://www.firstmerchants.com/
SOURCE: First Merchants Corporation, Muncie, Indiana
FIRST MERCHANTS CORPORATION ANNOUNCES 2010 RESULTS
First Merchants Corporation (NASDAQ – FRME) has reported 2010 year-to-date earnings of $.48 per fully diluted common share and net income available to common stockholders totaling $11.7 million. Fourth quarter earnings totaled $.10 per fully diluted common share and net income available to common stockholders totaled $2.6 million.
Michael C. Rechin, President and Chief Executive Officer, stated, “Our results for 2010 are reflective of progress made in several fundamentals of our business allowing us to benefit from the growth opportunities in our markets. We achieved a meaningful increase in our capital levels, while building our net-interest margin and prudently managing our operating expenses. We also continued to achieve improvement in our asset quality. Non-performing asset levels reduced in the fourth quarter and throughout 2010. The improvement drove a materially lower loan loss provision that coupled with our net-interest income produced a return to profitability for 2010. Knowing that the economy remains tenuous, we continue to maintain a prudent reserve entering 2011 at 2.90 percent of our current loan portfolio.”
Total assets were $4.17 billion as of year-end a decline of $311 million from December 31, 2009 as total loans, including loans held for sale, declined by $421 million to $2.86 billion. Loan demand from our commercial and consumer customers remains soft, but improved the overall liquidity of the balance sheet. The Corporation’s non-maturity or demand and saving deposits totaled $2.1 billion, 65 percent of total deposits, an increase of $85 million or 4.2 percent.
Decreased loan demand and increased deposits are reflective of the economy and reduced customer leverage. Excess liquidity was used to strategically reduce higher paying term deposit liabilities and borrowings such as Federal Home Loan Bank advances and brokered certificates of deposit by $400 million. Additionally, excess cash and short term investments were reinvested in the bond portfolio which now totals $827 million. Overall, the Corporation’s loan-to-deposit ratio declined from 93 percent to 87 percent and the loan-to-asset ratio declined from 73 percent to 69 percent.
Mark K. Hardwick, Executive Vice President and Chief Financial Officer, stated, “First Merchants is a more nimble company due to the completion of three data consolidations throughout 2010 and its move to a line of business organization structure. Improved net interest margin and lower overhead expenses helped mitigate the effects of fewer earning assets.”
Net-Interest margin expanded during the year by 13 basis points, from 3.74 percent to 3.87 percent of earning assets. Asset yields declined by 24 basis points and the cost of supporting liabilities declined by 37 basis points. Net interest income totaled $143.6 million a decline of $9.7 million from the full year 2009 results of $153.3 million.
The Corporation’s allowance for loan losses totaled $83 million as of year end 2010. The allowance now provides 91.6 percent coverage of all non-accrual loans and 2.90 percent of total loans. Provision expense for the year declined from $122.2 million in 2009 to $46.5 million in 2010 as net charge-off’s also declined during the year from $81.6 million to $55.6 million.
Non-interest income totaled $46.6 million for the year, after adjusting for positive bond gains and other-than-temporary impairment (OTTI) charges of $1.9 million. Non-interest income for 2009 totaled $46.5 million, after adjusting for positive bond gains and other-than-temporary impairment (OTTI) charges of $4.4 million.
Total non-interest expense totaled $142.3 million, a decrease of $9.3 million when compared to 2009 expense total of $151.6 million. Reductions in non-interest expense were achieved in every reported expense line item.
As of December 31, 2010, the Corporation’s total risk-based capital measured 15.72 percent, Tier 1 risk-based capital totaled 12.80 percent, Tier 1 leverage ratio totaled 9.49 percent, and the tangible common equity ratio totaled 5.84 percent. All regulatory capital ratios exceed the regulatory definitions of “well capitalized”.
CONFERENCE CALL
First Merchants Corporation will conduct a fourth quarter earnings conference call and web cast at 2:30 p.m. (ET) on Thursday, January 27, 2011.
To participate, dial (Toll Free) 877-317-6789 and reference First Merchants Corporation’s fourth quarter earnings release. International callers please call +1 412-317-6789. A replay of the call will be available until February 4, 2011 at 9:00 a.m. (ET). To access a replay of the call, US/Canada participants should dial (Toll Free) 877-344-7529 or for International participants, dial +1 412-317-0088. The replay passcode is 446916.
In order to view the web cast and presentation slides, please go to http://www.talkpoint.com/viewer/starthere.asp?Pres=133654 during the time of the call.
During the call, Forward-Looking Statements about the relative business outlook may be made. These Forward-Looking Statements and all other statements made during the call that do not concern historical facts, are subject to risks and uncertainties that may materially affect actual results.
Specific Forward-Looking Statements include, but are not limited to, any indications regarding the Financial Services industry, the economy and future growth of the balance sheet or income statement.
Detailed financial results are reported on the attached pages.
About First Merchants Corporation
First Merchants Corporation is a financial holding company headquartered in Muncie, Indiana. The Corporation is comprised of First Merchants Bank, N.A., which also operates as Lafayette Bank & Trust, Commerce National Bank, and First Merchants Trust Company as divisions of First Merchants Bank, N.A. First Merchants Corporation also operates First Merchants Insurance Group, a full-service property casualty, personal lines, and healthcare insurance agency.
First Merchants Corporation’s common stock is traded on the NASDAQ Global Select Market System under the symbol FRME. Quotations are carried in daily newspapers and can be found on the company’s Internet web page (http://www.firstmerchants.com).
* * * *
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CONSOLIDATED BALANCE SHEETS
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||||||||
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(Dollars in thousands)
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December 31,
|
|||||||
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2010
|
2009
|
|||||||
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ASSETS
|
||||||||
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Cash and due from banks
|
$
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50,844
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$
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76,801
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||||
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Federal funds sold
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7,463
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102,346
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||||||
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Cash and cash equivalents
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58,307
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179,147
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||||||
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Interest-bearing time deposits
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65,216
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74,025
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||||||
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Investment securities
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826,797
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563,117
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||||||
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Mortgage loans held for sale
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21,469
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8,036
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||||||
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Loans
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2,835,683
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3,269,788
|
||||||
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Less: Allowance for loan losses
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(82,977
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)
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(92,131
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)
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||||
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Net loans
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2,752,706
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3,177,657
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||||||
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Premises and equipment
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52,450
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55,804
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||||||
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Federal Reserve and Federal Home Loan Bank stock
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33,884
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38,576
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||||||
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Interest receivable
|
18,674
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20,818
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||||||
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Core deposit intangibles and goodwill
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154,019
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158,740
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||||||
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Cash surrender value of life insurance
|
96,731
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94,636
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||||||
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Other real estate owned
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20,927
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14,879
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||||||
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Tax asset, deferred and receivable
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45,017
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64,394
|
||||||
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Other assets
|
24,045
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31,123
|
||||||
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TOTAL ASSETS
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$
|
4,170,242
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$
|
4,480,952
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||||
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LIABILITIES
|
||||||||
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Deposits:
|
||||||||
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Noninterest-bearing
|
$
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583,696
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$
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516,487
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||||
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Interest-bearing
|
2,685,184
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3,020,049
|
||||||
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Total Deposits
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3,268,880
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3,536,536
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||||||
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Borrowings:
|
||||||||
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Securities sold under repurchase agreements
|
109,871
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125,687
|
||||||
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Federal Home Loan Bank advances
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82,684
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129,749
|
||||||
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Subordinated debentures, revolving credit lines and term loans
|
226,440
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194,790
|
||||||
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Total Borrowings
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418,995
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450,226
|
||||||
|
Interest payable
|
4,262
|
5,711
|
||||||
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Other liabilities
|
24,303
|
24,694
|
||||||
|
Total Liabilities
|
3,716,440
|
4,017,167
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||||||
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STOCKHOLDERS' EQUITY
|
||||||||
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Preferred Stock, no-par value:
|
||||||||
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Authorized -- 500,000 shares
|
||||||||
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Series A, Issued and outstanding - 69,600 and 116,000 shares
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67,880
|
112,373
|
||||||
|
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
|
||||||||
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Authorized -- 600 shares
|
||||||||
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Issued and outstanding - 125 shares
|
125
|
125
|
||||||
|
Common Stock, $.125 stated value:
|
||||||||
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Authorized -- 50,000,000 shares
|
||||||||
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Issued and outstanding - 25,574,251 and 21,227,741 shares
|
3,197
|
2,653
|
||||||
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Additional paid-in capital
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232,503
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206,600
|
||||||
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Retained earnings
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160,254
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150,860
|
||||||
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Accumulated other comprehensive loss
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(10,157
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)
|
(8,826
|
)
|
||||
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Total Stockholders' Equity
|
453,802
|
463,785
|
||||||
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
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4,170,242
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$
|
4,480,952
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||||
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CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
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(Dollars in thousands, except per share amounts)
|
Three Months Ended
|
Twelve Months Ended
|
||||||||||||||
|
December 31,
|
December 31,
|
|||||||||||||||
|
2010
|
2009
|
2010
|
2009
|
|||||||||||||
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INTEREST INCOME
|
||||||||||||||||
|
Loans receivable:
|
||||||||||||||||
|
Taxable
|
$
|
41,497
|
$
|
48,297
|
$
|
174,070
|
$
|
205,616
|
||||||||
|
Tax exempt
|
(250
|
)
|
296
|
515
|
1,038
|
|||||||||||
|
Investment securities:
|
||||||||||||||||
|
Taxable
|
3,680
|
2,348
|
12,957
|
12,335
|
||||||||||||
|
Tax exempt
|
2,573
|
2,668
|
10,377
|
9,587
|
||||||||||||
|
Federal funds sold
|
3
|
37
|
26
|
118
|
||||||||||||
|
Deposits with financial institutions
|
142
|
75
|
381
|
366
|
||||||||||||
|
Federal Reserve and Federal Home Loan Bank stock
|
312
|
348
|
1,252
|
1,379
|
||||||||||||
|
Total Interest Income
|
47,957
|
54,069
|
199,578
|
230,439
|
||||||||||||
|
INTEREST EXPENSE
|
||||||||||||||||
|
Deposits
|
8,427
|
12,445
|
39,876
|
58,391
|
||||||||||||
|
Federal funds purchased
|
5
|
28
|
||||||||||||||
|
Securities sold under repurchase agreements
|
383
|
511
|
1,712
|
1,997
|
||||||||||||
|
Federal Home Loan Bank advances
|
1,146
|
1,627
|
5,368
|
9,232
|
||||||||||||
|
Subordinated debentures, revolving credit lines and term loans
|
2,508
|
1,921
|
9,048
|
7,445
|
||||||||||||
|
Total Interest Expense
|
12,464
|
16,504
|
56,009
|
77,093
|
||||||||||||
|
NET INTEREST INCOME
|
35,493
|
37,565
|
143,569
|
153,346
|
||||||||||||
|
Provision for loan losses
|
7,078
|
26,020
|
46,483
|
122,176
|
||||||||||||
|
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES
|
28,415
|
11,545
|
97,086
|
31,170
|
||||||||||||
|
OTHER INCOME
|
||||||||||||||||
|
Service charges on deposit accounts
|
3,111
|
3,735
|
13,283
|
15,128
|
||||||||||||
|
Fiduciary activities
|
1,881
|
1,826
|
7,692
|
7,409
|
||||||||||||
|
Other customer fees
|
2,217
|
1,969
|
8,990
|
7,922
|
||||||||||||
|
Commission income
|
1,267
|
1,181
|
6,225
|
6,397
|
||||||||||||
|
Earnings on cash surrender value of life insurance
|
524
|
569
|
2,098
|
1,614
|
||||||||||||
|
Net gains and fees on sales of loans
|
2,384
|
1,744
|
6,806
|
6,849
|
||||||||||||
|
Net realized gains on sales of available for sale securities
|
1,305
|
1,984
|
3,406
|
11,141
|
||||||||||||
|
Other-than-temporary impairment on available for sale securities
|
(2,979
|
)
|
(1,544
|
)
|
(6,729
|
)
|
||||||||||
|
Other income
|
904
|
(472
|
)
|
1,588
|
1,470
|
|||||||||||
|
Total Other Income
|
13,593
|
9,557
|
48,544
|
51,201
|
||||||||||||
|
OTHER EXPENSES
|
||||||||||||||||
|
Salaries and employee benefits
|
19,655
|
18,680
|
73,253
|
76,325
|
||||||||||||
|
Net occupancy
|
2,452
|
2,816
|
9,935
|
10,250
|
||||||||||||
|
Equipment
|
1,812
|
1,935
|
7,323
|
7,595
|
||||||||||||
|
Marketing
|
527
|
513
|
1,970
|
2,134
|
||||||||||||
|
Outside data processing fees
|
1,154
|
1,488
|
5,093
|
6,186
|
||||||||||||
|
Printing and office supplies
|
317
|
359
|
1,259
|
1,419
|
||||||||||||
|
Core deposit amortization
|
1,161
|
1,277
|
4,721
|
5,109
|
||||||||||||
|
FDIC assessments
|
2,044
|
3,203
|
8,121
|
10,394
|
||||||||||||
|
Other expenses
|
9,071
|
9,386
|
30,636
|
32,146
|
||||||||||||
|
Total Other Expenses
|
38,193
|
39,657
|
142,311
|
151,558
|
||||||||||||
|
INCOME (LOSS) BEFORE INCOME TAX
|
3,815
|
(18,555
|
)
|
3,319
|
(69,187
|
)
|
||||||||||
|
Income tax expense (benefit)
|
390
|
(8,334
|
)
|
(2,984
|
)
|
(28,424
|
)
|
|||||||||
|
NET INCOME (LOSS)
|
3,425
|
(10,221
|
)
|
6,303
|
(40,763
|
)
|
||||||||||
|
Gain on exchange of preferred stock for trust preferred debt
|
10,052
|
|||||||||||||||
|
Preferred stock dividends and discount accretion
|
(870
|
)
|
(1,451
|
)
|
(4,633
|
)
|
(4,979
|
)
|
||||||||
|
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS
|
$
|
2,555
|
$
|
(11,672
|
)
|
$
|
11,722
|
$
|
(45,742
|
)
|
||||||
|
Per Share Data:
|
||||||||||||||||
|
Basic Net Income (Loss) Available to Common Stockholders
|
$
|
0.10
|
$
|
(0.55
|
)
|
$
|
0.48
|
$
|
(2.17
|
)
|
||||||
|
Diluted Net Income (Loss) Available to Common Stockholders
|
$
|
0.10
|
$
|
(0.55
|
)
|
$
|
0.48
|
$
|
(2.17
|
)
|
||||||
|
Cash Dividends Paid
|
$
|
0.01
|
$
|
0.08
|
$
|
0.04
|
$
|
0.47
|
||||||||
|
Average Diluted Shares Outstanding (in thousands)
|
25,737
|
21,211
|
24,642
|
21,117
|
||||||||||||
|
FINANCIAL HIGHLIGHTS
|
||||||||||||||||
|
(Dollars in thousands)
|
Three Months Ended
|
Twelve Months Ended
|
||||||||||||||
|
December 31,
|
December 31,
|
|||||||||||||||
|
2010
|
2009
|
2010
|
2009
|
|||||||||||||
|
NET CHARGE OFF'S
|
$
|
7,761
|
$
|
20,807
|
$
|
55,637
|
$
|
81,628
|
||||||||
|
AVERAGE BALANCES:
|
||||||||||||||||
|
Total Assets
|
$
|
4,249,187
|
$
|
4,503,078
|
$
|
4,271,714
|
$
|
4,674,590
|
||||||||
|
Total Loans
|
2,893,657
|
3,345,086
|
3,050,850
|
3,546,316
|
||||||||||||
|
Total Earning Assets
|
3,835,814
|
4,065,295
|
3,862,493
|
4,245,134
|
||||||||||||
|
Total Deposits
|
3,323,209
|
3,544,233
|
3,337,747
|
3,603,509
|
||||||||||||
|
Total Stockholders' Equity
|
464,243
|
473,014
|
470,377
|
477,148
|
||||||||||||
|
FINANCIAL RATIOS:
|
||||||||||||||||
|
Return on Average Assets
|
0.24
|
%
|
-1.04
|
%
|
0.27
|
%
|
-0.98
|
%
|
||||||||
|
Return on Average Stockholders' Equity
|
2.20
|
(9.87
|
)
|
2.49
|
(9.59
|
)
|
||||||||||
|
Average Earning Assets to Average Assets
|
90.27
|
90.28
|
90.42
|
90.81
|
||||||||||||
|
Allowance for Loan Losses as % of Total Loans
|
2.90
|
2.81
|
2.90
|
2.81
|
||||||||||||
|
Net Charge Off's as % of Average Loans (Annualized)
|
1.07
|
2.49
|
1.82
|
2.30
|
||||||||||||
|
Average Stockholders' Equity to Average Assets
|
10.93
|
10.50
|
11.01
|
10.21
|
||||||||||||
|
Tax Equivalent Yield on Earning Assets
|
5.13
|
5.48
|
5.32
|
5.56
|
||||||||||||
|
Cost of Supporting Liabilities
|
1.30
|
1.62
|
1.45
|
1.82
|
||||||||||||
|
Net Interest Margin (FTE) on Earning Assets
|
3.83
|
3.86
|
3.87
|
3.74
|
||||||||||||
|
NON-PERFORMING ASSETS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||||||||||||||||
|
Non-Accrual Loans
|
$
|
90,591
|
$
|
98,597
|
$
|
120,205
|
$
|
122,891
|
$
|
118,409
|
||||||||||
|
Renegotiated Loans
|
7,139
|
5,320
|
1,657
|
859
|
8,833
|
|||||||||||||||
|
Non-Performing Loans (NPL)
|
97,730
|
103,917
|
121,862
|
123,750
|
127,242
|
|||||||||||||||
|
Real Estate Owned and Repossessed Assets
|
20,927
|
21,546
|
20,124
|
18,268
|
14,879
|
|||||||||||||||
|
Non-Performing Assets (NPA)
|
118,657
|
125,463
|
141,986
|
142,018
|
142,121
|
|||||||||||||||
|
90+ Days Delinquent
|
1,330
|
5,320
|
4,537
|
2,600
|
3,967
|
|||||||||||||||
|
NPAS & 90 Day Delinquent
|
$
|
119,987
|
$
|
130,783
|
$
|
146,523
|
$
|
144,618
|
$
|
146,088
|
||||||||||
|
Loan Loss Reserve
|
$
|
82,977
|
$
|
83,660
|
$
|
86,970
|
$
|
88,568
|
$
|
92,131
|
||||||||||
|
YTD Charge-offs
|
55,637
|
47,876
|
34,045
|
17,432
|
81,628
|
|||||||||||||||
|
NPAs / Actual Assets %
|
2.85
|
%
|
3.00
|
%
|
3.39
|
%
|
3.25
|
%
|
3.17
|
%
|
||||||||||
|
NPAs & 90 Day / Actual Assets %
|
2.88
|
%
|
3.13
|
%
|
3.50
|
%
|
3.30
|
%
|
3.26
|
%
|
||||||||||
|
NPAs / Actual Loans and REO %
|
4.12
|
%
|
4.25
|
%
|
4.61
|
%
|
4.50
|
%
|
4.32
|
%
|
||||||||||
|
Loan Loss Reserves / Actual Loans (%)
|
2.90
|
%
|
2.86
|
%
|
2.84
|
%
|
2.82
|
%
|
2.81
|
%
|
||||||||||
|
NCOs / YTD Average Loans (%)
|
1.82
|
%
|
1.54
|
%
|
1.08
|
%
|
0.54
|
%
|
2.30
|
%
|
||||||||||
|
CONSOLIDATED BALANCE SHEETS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||||||||||||||||
|
ASSETS
|
||||||||||||||||||||
|
Cash and due from banks
|
$
|
50,844
|
$
|
54,736
|
$
|
60,223
|
$
|
52,679
|
$
|
76,801
|
||||||||||
|
Federal funds sold
|
7,463
|
6,392
|
4,101
|
7,044
|
102,346
|
|||||||||||||||
|
Cash and cash equivalents
|
58,307
|
61,128
|
64,324
|
59,723
|
179,147
|
|||||||||||||||
|
Interest-bearing time deposits
|
65,216
|
114,401
|
40,823
|
157,735
|
74,025
|
|||||||||||||||
|
Investment securities
|
826,797
|
701,852
|
646,185
|
639,081
|
563,117
|
|||||||||||||||
|
Mortgage loans held for sale
|
21,469
|
15,390
|
7,600
|
3,646
|
8,036
|
|||||||||||||||
|
Loans
|
2,835,683
|
2,913,364
|
3,051,346
|
3,134,540
|
3,269,788
|
|||||||||||||||
|
Less: Allowance for loan losses
|
(82,977
|
)
|
(83,660
|
)
|
(86,970
|
)
|
(88,568
|
)
|
(92,131
|
)
|
||||||||||
|
Net loans
|
2,752,706
|
2,829,704
|
2,964,376
|
3,045,972
|
3,177,657
|
|||||||||||||||
|
Premises and equipment
|
52,450
|
52,774
|
53,437
|
54,431
|
55,804
|
|||||||||||||||
|
Federal Reserve and Federal Home Loan Bank stock
|
33,884
|
36,271
|
36,218
|
36,721
|
38,576
|
|||||||||||||||
|
Interest receivable
|
18,674
|
20,310
|
18,894
|
19,532
|
20,818
|
|||||||||||||||
|
Core deposit intangibles and goodwill
|
154,019
|
155,180
|
156,340
|
157,532
|
158,740
|
|||||||||||||||
|
Cash surrender value of life insurance
|
96,731
|
96,206
|
95,666
|
95,146
|
94,636
|
|||||||||||||||
|
Other real estate owned
|
20,927
|
21,546
|
20,124
|
18,268
|
14,879
|
|||||||||||||||
|
Tax asset, deferred and refundable
|
45,017
|
50,972
|
52,839
|
59,190
|
64,394
|
|||||||||||||||
|
Other assets
|
24,045
|
24,586
|
26,422
|
28,889
|
31,123
|
|||||||||||||||
|
TOTAL ASSETS
|
$
|
4,170,242
|
$
|
4,180,320
|
$
|
4,183,248
|
$
|
4,375,866
|
$
|
4,480,952
|
||||||||||
|
LIABILITIES
|
||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||
|
Noninterest-bearing
|
$
|
583,696
|
$
|
525,463
|
$
|
516,769
|
$
|
520,551
|
$
|
516,487
|
||||||||||
|
Interest-bearing
|
2,685,184
|
2,728,888
|
2,744,194
|
2,877,235
|
3,020,049
|
|||||||||||||||
|
Total Deposits
|
3,268,880
|
3,254,351
|
3,260,963
|
3,397,786
|
3,536,536
|
|||||||||||||||
|
Borrowings:
|
||||||||||||||||||||
|
Securities sold under repurchase agreements
|
109,871
|
109,647
|
107,505
|
112,826
|
125,687
|
|||||||||||||||
|
Federal Home Loan Bank advances
|
82,684
|
92,628
|
100,540
|
123,261
|
129,749
|
|||||||||||||||
|
Subordinated debentures, revolving credit lines and term loans
|
226,440
|
227,514
|
225,867
|
194,794
|
194,790
|
|||||||||||||||
|
Total Borrowings
|
418,995
|
429,789
|
433,912
|
430,881
|
450,226
|
|||||||||||||||
|
Interest payable
|
4,262
|
4,011
|
4,911
|
4,812
|
5,711
|
|||||||||||||||
|
Other liabilities
|
24,303
|
29,704
|
25,933
|
53,446
|
24,694
|
|||||||||||||||
|
Total Liabilities
|
3,716,440
|
3,717,855
|
3,725,719
|
3,886,925
|
4,017,167
|
|||||||||||||||
|
STOCKHOLDERS' EQUITY
|
||||||||||||||||||||
|
Preferred Stock, no-par value:
|
||||||||||||||||||||
|
Authorized -- 500,000 shares
|
||||||||||||||||||||
|
Series A, Issued and outstanding - 69,600 and 116,000 shares
|
67,880
|
67,764
|
67,649
|
112,559
|
112,373
|
|||||||||||||||
|
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
|
||||||||||||||||||||
|
Authorized -- 600 shares
|
||||||||||||||||||||
|
Issued and outstanding - 125 shares
|
125
|
125
|
125
|
125
|
125
|
|||||||||||||||
|
Common Stock, $.125 stated value:
|
||||||||||||||||||||
|
Authorized -- 50,000,000 shares
|
||||||||||||||||||||
|
Issued and outstanding - 25,574,251 and 21,227,741 shares
|
3,197
|
3,194
|
3,191
|
3,187
|
2,653
|
|||||||||||||||
|
Additional paid-in capital
|
232,503
|
231,979
|
231,372
|
230,764
|
206,600
|
|||||||||||||||
|
Retained earnings
|
160,254
|
158,074
|
158,118
|
150,595
|
150,860
|
|||||||||||||||
|
Accumulated other comprehensive income (loss)
|
(10,157
|
)
|
1,329
|
(2,926
|
)
|
(8,289
|
)
|
(8,826
|
)
|
|||||||||||
|
Total Stockholders' Equity
|
453,802
|
462,465
|
457,529
|
488,941
|
463,785
|
|||||||||||||||
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
|
4,170,242
|
$
|
4,180,320
|
$
|
4,183,248
|
$
|
4,375,866
|
$
|
4,480,952
|
||||||||||
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||||||
|
(Dollars in thousands, except per share amounts)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||||||||||||||||
|
INTEREST INCOME
|
||||||||||||||||||||
|
Loans receivable:
|
||||||||||||||||||||
|
Taxable
|
$
|
41,497
|
$
|
43,148
|
$
|
43,977
|
$
|
45,448
|
$
|
48,297
|
||||||||||
|
Tax exempt
|
(250
|
)
|
236
|
252
|
277
|
296
|
||||||||||||||
|
Investment securities:
|
||||||||||||||||||||
|
Taxable
|
3,680
|
3,100
|
3,286
|
2,891
|
2,348
|
|||||||||||||||
|
Tax exempt
|
2,573
|
2,610
|
2,548
|
2,646
|
2,668
|
|||||||||||||||
|
Federal funds sold
|
3
|
3
|
3
|
17
|
37
|
|||||||||||||||
|
Deposits with financial institutions
|
142
|
84
|
95
|
60
|
75
|
|||||||||||||||
|
Federal Reserve and Federal Home Loan Bank stock
|
312
|
250
|
330
|
360
|
348
|
|||||||||||||||
|
Total Interest Income
|
47,957
|
49,431
|
50,491
|
51,699
|
54,069
|
|||||||||||||||
|
INTEREST EXPENSE
|
||||||||||||||||||||
|
Deposits
|
8,427
|
9,434
|
10,520
|
11,495
|
12,445
|
|||||||||||||||
|
Federal funds purchased
|
1
|
4
|
||||||||||||||||||
|
Securities sold under repurchase agreements
|
383
|
401
|
429
|
499
|
511
|
|||||||||||||||
|
Federal Home Loan Bank advances
|
1,146
|
1,218
|
1,440
|
1,564
|
1,627
|
|||||||||||||||
|
Subordinated debentures, revolving credit lines and term loans
|
2,508
|
2,695
|
1,919
|
1,926
|
1,921
|
|||||||||||||||
|
Total Interest Expense
|
12,464
|
13,749
|
14,312
|
15,484
|
16,504
|
|||||||||||||||
|
NET INTEREST INCOME
|
35,493
|
35,682
|
36,179
|
36,215
|
37,565
|
|||||||||||||||
|
Provision for loan losses
|
7,078
|
10,521
|
15,015
|
13,869
|
26,020
|
|||||||||||||||
|
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES
|
28,415
|
25,161
|
21,164
|
22,346
|
11,545
|
|||||||||||||||
|
OTHER INCOME
|
||||||||||||||||||||
|
Service charges on deposit accounts
|
3,111
|
3,404
|
3,506
|
3,262
|
3,735
|
|||||||||||||||
|
Fiduciary activities
|
1,881
|
1,773
|
1,978
|
2,060
|
1,826
|
|||||||||||||||
|
Other customer fees
|
2,217
|
2,080
|
2,195
|
2,498
|
1,969
|
|||||||||||||||
|
Commission income
|
1,267
|
1,482
|
1,487
|
1,989
|
1,181
|
|||||||||||||||
|
Earnings on cash surrender value of life insurance
|
524
|
540
|
526
|
508
|
569
|
|||||||||||||||
|
Net gains and fees on sales of loans
|
2,384
|
2,088
|
1,185
|
1,149
|
1,744
|
|||||||||||||||
|
Net realized and unrealized gains on sales of available for sale securities
|
1,305
|
2
|
257
|
1,842
|
1,984
|
|||||||||||||||
|
Other-than-temporary impairment on available for sale securities
|
(656
|
)
|
(400
|
)
|
(488
|
)
|
(2,979
|
)
|
||||||||||||
|
Other income
|
904
|
332
|
208
|
144
|
(472
|
)
|
||||||||||||||
|
Total Other Income
|
13,593
|
11,045
|
10,942
|
12,964
|
9,557
|
|||||||||||||||
|
OTHER EXPENSES
|
||||||||||||||||||||
|
Salaries and employee benefits
|
19,655
|
18,094
|
17,942
|
17,562
|
18,680
|
|||||||||||||||
|
Net occupancy
|
2,452
|
2,574
|
2,058
|
2,851
|
2,816
|
|||||||||||||||
|
Equipment
|
1,812
|
1,797
|
1,861
|
1,853
|
1,935
|
|||||||||||||||
|
Marketing
|
527
|
519
|
495
|
429
|
513
|
|||||||||||||||
|
Outside data processing fees
|
1,154
|
1,348
|
1,311
|
1,280
|
1,488
|
|||||||||||||||
|
Printing and office supplies
|
317
|
303
|
321
|
318
|
359
|
|||||||||||||||
|
Core deposit amortization
|
1,161
|
1,161
|
1,192
|
1,207
|
1,277
|
|||||||||||||||
|
FDIC assessments
|
2,044
|
2,112
|
2,243
|
1,722
|
3,203
|
|||||||||||||||
|
Other expenses
|
9,071
|
7,227
|
6,920
|
7,418
|
9,386
|
|||||||||||||||
|
Total Other Expenses
|
38,193
|
35,135
|
34,343
|
34,640
|
39,657
|
|||||||||||||||
|
INCOME (LOSS) BEFORE INCOME TAX
|
3,815
|
1,071
|
(2,237
|
)
|
670
|
(18,555
|
)
|
|||||||||||||
|
Income tax expense (benefit)
|
390
|
(564
|
)
|
(1,894
|
)
|
(916
|
)
|
(8,334
|
)
|
|||||||||||
|
NET INCOME (LOSS)
|
3,425
|
1,635
|
(343
|
)
|
1,586
|
(10,221
|
)
|
|||||||||||||
|
Gain on exchange of preferred stock for trust preferred debt
|
10,052
|
|||||||||||||||||||
|
Preferred stock dividends and discount accretion
|
(870
|
)
|
(870
|
)
|
(1,443
|
)
|
(1,450
|
)
|
(1,451
|
)
|
||||||||||
|
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS
|
$
|
2,555
|
$
|
765
|
$
|
8,266
|
$
|
136
|
$
|
(11,672
|
)
|
|||||||||
|
PER SHARE:
|
||||||||||||||||||||
|
Basic Net Income (Loss) Available to Common Stockholders
|
$
|
0.10
|
$
|
0.02
|
$
|
0.35
|
$
|
0.01
|
$
|
(0.55
|
)
|
|||||||||
|
Diluted Net Income (Loss) Available to Common Stockholders
|
$
|
0.10
|
$
|
0.02
|
$
|
0.35
|
$
|
0.01
|
$
|
(0.55
|
)
|
|||||||||
|
Cash Dividends Paid
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
$
|
0.08
|
||||||||||
|
Average Diluted Shares Outstanding (in thousands)
|
25,737
|
25,686
|
25,633
|
21,462
|
21,211
|
|||||||||||||||
|
FINANCIAL RATIOS:
|
||||||||||||||||||||
|
Return on Average Assets
|
0.24
|
%
|
0.07
|
%
|
0.77
|
%
|
0.01
|
%
|
-1.04
|
%
|
||||||||||
|
Return on Average Stockholders' Equity
|
2.20
|
0.67
|
6.73
|
0.12
|
(9.87
|
)
|
||||||||||||||
|
Average Earning Assets to Average Assets
|
90.27
|
90.39
|
90.34
|
90.64
|
90.28
|
|||||||||||||||
|
Allowance for Loan Losses as % of Total Loans
|
2.90
|
2.86
|
2.84
|
2.82
|
2.81
|
|||||||||||||||
|
Net Charge Off's as % of Average Loans (Annualized)
|
1.07
|
1.84
|
2.14
|
2.18
|
2.49
|
|||||||||||||||
|
Average Stockholders' Equity to Average Assets
|
10.93
|
10.95
|
11.47
|
10.70
|
10.50
|
|||||||||||||||
|
Tax Equivalent Yield on Earning Assets
|
5.13
|
5.38
|
5.38
|
5.39
|
5.48
|
|||||||||||||||
|
Cost of Supporting Liabilities
|
1.30
|
1.45
|
1.48
|
1.57
|
1.62
|
|||||||||||||||
|
Net Interest Margin (FTE) on Earning Assets
|
3.83
|
3.93
|
3.90
|
3.82
|
3.86
|
|||||||||||||||
|
LOANS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||||||||||||||||
|
Commercial and industrial loans
|
$
|
530,322
|
$
|
550,310
|
$
|
589,157
|
$
|
621,591
|
$
|
675,860
|
||||||||||
|
Agricultural production financing and other loans to farmers
|
95,516
|
99,087
|
108,439
|
109,457
|
121,031
|
|||||||||||||||
|
Real estate loans:
|
||||||||||||||||||||
|
Construction
|
106,615
|
91,705
|
111,070
|
131,548
|
158,725
|
|||||||||||||||
|
Commercial and farmland
|
1,229,037
|
1,229,836
|
1,269,455
|
1,282,635
|
1,276,164
|
|||||||||||||||
|
Residential
|
724,020
|
779,483
|
816,823
|
821,014
|
841,584
|
|||||||||||||||
|
Individuals' loans for household and other personal expenditures
|
115,295
|
128,400
|
129,724
|
142,108
|
154,132
|
|||||||||||||||
|
Lease financing receivables, net of unearned income
|
5,157
|
5,763
|
6,143
|
6,396
|
7,135
|
|||||||||||||||
|
Other loans
|
29,721
|
28,780
|
20,535
|
19,791
|
35,157
|
|||||||||||||||
|
Loans
|
2,835,683
|
2,913,364
|
3,051,346
|
3,134,540
|
3,269,788
|
|||||||||||||||
|
Allowance for loan losses
|
(82,977
|
)
|
(83,660
|
)
|
(86,970
|
)
|
(88,568
|
)
|
(92,131
|
)
|
||||||||||
|
NET LOANS
|
$
|
2,752,706
|
$
|
2,829,704
|
$
|
2,964,376
|
$
|
3,045,972
|
$
|
3,177,657
|
||||||||||
|
DEPOSITS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||||||||||||||||
|
Demand deposits
|
$
|
1,362,927
|
$
|
1,288,975
|
$
|
1,246,006
|
$
|
1,261,305
|
$
|
1,308,741
|
||||||||||
|
Savings deposits
|
763,949
|
761,181
|
730,105
|
738,742
|
733,142
|
|||||||||||||||
|
Certificates and other time deposits of $100,000 or more
|
334,748
|
350,623
|
374,016
|
416,113
|
438,264
|
|||||||||||||||
|
Other certificates and time deposits
|
661,569
|
685,917
|
715,941
|
750,382
|
781,509
|
|||||||||||||||
|
Brokered deposits
|
145,687
|
167,655
|
194,895
|
231,244
|
274,880
|
|||||||||||||||
|
TOTAL DEPOSITS
|
$
|
3,268,880
|
$
|
3,254,351
|
$
|
3,260,963
|
$
|
3,397,786
|
$
|
3,536,536
|
||||||||||