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 26, 2012
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 26, 2012 First Merchants Corporation issued a press release to report its financial results for the fourth quarter ended December 31, 2011. 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 26, 2012, 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 26, 2012
EXHIBIT INDEX
Exhibit No. Description
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99.1
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Press Release, dated January 26, 2012, issued by First Merchants Corporation
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N / E / W / S R / E / L / E / A / S / E
January 26, 2012
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 FOURTH QUARTER AND FISCAL YEAR-END 2011 EARNINGS PER SHARE
First Merchants Corporation (NASDAQ – FRME) has reported fourth quarter 2011 earnings per share of $.24 compared to $.10 during the same period in 2010. The 140 percent improvement primarily reflects the Corporation’s improvement in revenue, credit quality and efficiency. Net income available to common shareholders totaled $6.4 million, an increase of $3.8 million over the $2.6 million earned in the fourth quarter of 2010.
Year-to-date earnings per share for 2011 totaled $.34 per fully diluted common share. When adjusted for the one-time charge of $.46 per share related to CPP repayment during the third quarter, year-to-date core earnings per share totaled $.80. On an adjusted basis earnings per share for the four quarters of 2011 totaled $.17, $.18, $.21 and $.24, respectively.
Michael C. Rechin, President and Chief Executive Officer, stated, “2011 results included numerous positives as the company completed a solid year. The improvement of the Corporation’s core earnings, capital levels, credit statistics, loan growth and efficiency provide important foundations for the future of First Merchants.” Rechin also stated, “Achieving loan growth in the fourth quarter, while making additional improvements in asset quality, reflects the economic progress evidenced in our marketplace.”
Total assets equaled $4.2 billion as of year-end and total loans were $2.7 billion. The Corporation’s liquidity is fully deployed in the bond portfolio, as investment securities totaled $946 million. The Corporation’s loan-to-deposit ratio is now 87 percent and the loan-to-asset ratio totals 65 percent.
Net-interest income totaled $36.2 million for the quarter and $143.4 million for the year. Net-interest margin remained strong during the quarter totaling 3.99 percent as yields on earning assets totaled 4.83 percent and the cost of supporting liabilities totaled .84 percent. Net-interest margin for the year totaled 3.98 percent, up 11 basis points from 3.87 percent in 2010.
Non-interest income totaled $13.0 million for the quarter and $49.1 million for the full year of 2011. After normalizing for bond gains and losses, non-interest income improved by $393,000 quarter-over-quarter and $399,000 year-over-year. Non-interest expense totaled $33.4 million for the quarter, a decline of $4.8 million from the fourth quarter of 2010. Non-interest expense totaled $135.9 million for the full year 2011, a decline of $6.4 million for the year.
Provision expense totaled $5.9 million for the fourth quarter and $22.6 million for the full year 2011, compared to $7.1 million and $46.5 million of provision expense in 2010. The allowance for loan losses totaled $70.9 million, or 2.6 percent of total loans and 102 percent of non-accrual loans. Non-performing assets (NPA) plus 90 days delinquent loans totaled $100.8 million, or 2.4 percent of total assets. Net charge-offs totaled $8.0 million for the fourth quarter and $34.7 million for the year. Net charge-offs totaled $55.6 million in 2010. Classified loans also declined from $286.2 million to $205.2 million during the year.
As of December 31, 2011, the Corporation’s total risk-based capital equaled 16.54 percent, Tier 1 common risk-based capital equaled 8.83 percent, and tangible common equity ratio totaled 6.84 percent.
CONFERENCE CALL
First Merchants Corporation will conduct a fourth quarter earnings conference call and web cast at 2:30 p.m. (EDT) on Thursday, January 26, 2012.
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 3, 2012. 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 10008694.
In order to view the web cast and presentation slides, please go to https://services.choruscall.com/links/frme120126.html 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
|
||||||||
|
(Dollars in thousands)
|
December 31,
|
|||||||
|
2011
|
2010
|
|||||||
|
ASSETS
|
||||||||
|
Cash and due from banks
|
$
|
73,312
|
$
|
50,844
|
||||
|
Federal funds sold
|
7,463
|
|||||||
|
Cash and cash equivalents
|
73,312
|
58,307
|
||||||
|
Interest-bearing time deposits
|
52,851
|
65,216
|
||||||
|
Investment securities
|
946,400
|
826,797
|
||||||
|
Mortgage loans held for sale
|
17,864
|
21,469
|
||||||
|
Loans
|
2,713,415
|
2,835,683
|
||||||
|
Less: Allowance for loan losses
|
(70,898
|
)
|
(82,977
|
)
|
||||
|
Net loans
|
2,642,517
|
2,752,706
|
||||||
|
Premises and equipment
|
51,013
|
52,450
|
||||||
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Federal Reserve and Federal Home Loan Bank stock
|
31,270
|
33,884
|
||||||
|
Interest receivable
|
17,723
|
18,674
|
||||||
|
Core deposit intangibles and goodwill
|
150,471
|
154,019
|
||||||
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Cash surrender value of life insurance
|
124,329
|
96,731
|
||||||
|
Other real estate owned
|
16,289
|
20,927
|
||||||
|
Tax asset, deferred and receivable
|
36,424
|
45,623
|
||||||
|
Other assets
|
12,613
|
24,045
|
||||||
|
TOTAL ASSETS
|
$
|
4,173,076
|
$
|
4,170,848
|
||||
|
LIABILITIES
|
||||||||
|
Deposits:
|
||||||||
|
Noninterest-bearing
|
$
|
646,508
|
$
|
583,696
|
||||
|
Interest-bearing
|
2,488,147
|
2,685,184
|
||||||
|
Total Deposits
|
3,134,655
|
3,268,880
|
||||||
|
Borrowings:
|
||||||||
|
Securities sold under repurchase agreements
|
156,305
|
109,871
|
||||||
|
Federal Home Loan Bank advances
|
138,095
|
82,684
|
||||||
|
Subordinated debentures, revolving credit lines and term loans
|
194,974
|
226,440
|
||||||
|
Total Borrowings
|
489,374
|
418,995
|
||||||
|
Interest payable
|
2,925
|
4,262
|
||||||
|
Other liabilities
|
31,655
|
24,303
|
||||||
|
Total Liabilities
|
3,658,609
|
3,716,440
|
||||||
|
STOCKHOLDERS' EQUITY
|
||||||||
|
Preferred Stock, no-par value:
|
||||||||
|
Authorized -- 500,000 shares
|
||||||||
|
Series A, Issued and outstanding - 0 and 69,600 shares
|
67,880
|
|||||||
|
Preferred Stock, no-par value, $1,000 liquidation value:
|
||||||||
|
Authorized -- 500,000 shares
|
||||||||
|
Senior Non-Cumulative Perpetual Preferred Stock, Series B
|
||||||||
|
Issued and outstanding - 90,782.94 and 0 shares
|
90,783
|
|||||||
|
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
|
||||||||
|
Authorized -- 600 shares
|
||||||||
|
Issued and outstanding - 125 shares
|
125
|
125
|
||||||
|
Common Stock, $.125 stated value:
|
||||||||
|
Authorized -- 50,000,000 shares
|
||||||||
|
Issued and outstanding - 28,559,707 and 25,574,251 shares
|
3,570
|
3,197
|
||||||
|
Additional paid-in capital
|
254,874
|
232,503
|
||||||
|
Retained earnings
|
168,717
|
160,860
|
||||||
|
Accumulated other comprehensive income (loss)
|
(3,602
|
)
|
(10,157
|
)
|
||||
|
Total Stockholders' Equity
|
514,467
|
454,408
|
||||||
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
|
4,173,076
|
$
|
4,170,848
|
||||
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
|
(Dollars in thousands, except per share amounts)
|
Three Months Ended
|
Twelve Months Ended
|
||||||||||||||
|
December 31,
|
December 31,
|
|||||||||||||||
|
2011
|
2010
|
2011
|
2010
|
|||||||||||||
|
INTEREST INCOME
|
||||||||||||||||
|
Loans receivable:
|
||||||||||||||||
|
Taxable
|
$
|
36,497
|
$
|
41,497
|
$
|
149,716
|
$
|
174,070
|
||||||||
|
Tax-exempt
|
93
|
(250
|
)
|
528
|
515
|
|||||||||||
|
Investment securities:
|
||||||||||||||||
|
Taxable
|
4,565
|
3,680
|
19,230
|
12,957
|
||||||||||||
|
Tax-exempt
|
2,550
|
2,573
|
10,167
|
10,377
|
||||||||||||
|
Federal funds sold
|
3
|
3
|
26
|
|||||||||||||
|
Deposits with financial institutions
|
54
|
142
|
282
|
381
|
||||||||||||
|
Federal Reserve and Federal Home Loan Bank stock
|
314
|
312
|
1,319
|
1,252
|
||||||||||||
|
Total Interest Income
|
44,073
|
47,957
|
181,245
|
199,578
|
||||||||||||
|
INTEREST EXPENSE
|
||||||||||||||||
|
Deposits
|
4,505
|
8,427
|
22,281
|
39,876
|
||||||||||||
|
Federal funds purchased
|
3
|
25
|
5
|
|||||||||||||
|
Securities sold under repurchase agreements
|
363
|
383
|
1,511
|
1,712
|
||||||||||||
|
Federal Home Loan Bank advances
|
1,114
|
1,146
|
4,181
|
5,368
|
||||||||||||
|
Subordinated debentures, revolving credit lines and term loans
|
1,908
|
2,508
|
9,892
|
9,048
|
||||||||||||
|
Total Interest Expense
|
7,893
|
12,464
|
37,890
|
56,009
|
||||||||||||
|
NET INTEREST INCOME
|
36,180
|
35,493
|
143,355
|
143,569
|
||||||||||||
|
Provision for loan losses
|
5,855
|
7,078
|
22,630
|
46,483
|
||||||||||||
|
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES
|
30,325
|
28,415
|
120,725
|
97,086
|
||||||||||||
|
OTHER INCOME
|
||||||||||||||||
|
Service charges on deposit accounts
|
3,027
|
3,111
|
11,972
|
13,283
|
||||||||||||
|
Fiduciary activities
|
1,804
|
1,881
|
7,650
|
7,692
|
||||||||||||
|
Other customer fees
|
2,572
|
2,217
|
10,024
|
8,990
|
||||||||||||
|
Commission income
|
1,220
|
1,267
|
5,660
|
6,225
|
||||||||||||
|
Earnings on cash surrender value of life insurance
|
803
|
524
|
2,596
|
2,098
|
||||||||||||
|
Net gains and fees on sales of loans
|
2,747
|
2,384
|
7,418
|
6,806
|
||||||||||||
|
Net realized gains on sales of available for sale securities
|
290
|
1,305
|
2,439
|
3,406
|
||||||||||||
|
Other-than-temporary impairment on available for sale securities
|
(400
|
)
|
(1,544
|
)
|
||||||||||||
|
Other income
|
508
|
904
|
1,761
|
1,588
|
||||||||||||
|
Total Other Income
|
12,971
|
13,593
|
49,120
|
48,544
|
||||||||||||
|
OTHER EXPENSES
|
||||||||||||||||
|
Salaries and employee benefits
|
19,035
|
19,655
|
74,735
|
73,253
|
||||||||||||
|
Net occupancy
|
2,428
|
2,452
|
10,118
|
9,935
|
||||||||||||
|
Equipment
|
1,672
|
1,812
|
6,794
|
7,323
|
||||||||||||
|
Marketing
|
650
|
527
|
2,002
|
1,970
|
||||||||||||
|
Outside data processing fees
|
1,377
|
1,154
|
5,671
|
5,093
|
||||||||||||
|
Printing and office supplies
|
340
|
317
|
1,242
|
1,259
|
||||||||||||
|
Core deposit amortization
|
591
|
1,161
|
3,548
|
4,721
|
||||||||||||
|
FDIC assessments
|
775
|
2,044
|
5,531
|
8,121
|
||||||||||||
|
Other real estate owned and credit-related expenses
|
2,569
|
5,257
|
10,614
|
12,436
|
||||||||||||
|
Other expenses
|
3,999
|
3,814
|
15,683
|
18,200
|
||||||||||||
|
Total Other Expenses
|
33,436
|
38,193
|
135,938
|
142,311
|
||||||||||||
|
INCOME BEFORE INCOME TAX
|
9,860
|
3,815
|
33,907
|
3,319
|
||||||||||||
|
Income tax expense (benefit)
|
2,299
|
(216
|
)
|
8,655
|
(3,590
|
)
|
||||||||||
|
NET INCOME
|
7,561
|
4,031
|
25,252
|
6,909
|
||||||||||||
|
Gain on exchange of preferred stock for trust preferred debt
|
11,353
|
|||||||||||||||
|
Loss on CPP unamortized discount
|
(1,401
|
)
|
(1,301
|
)
|
||||||||||||
|
Loss on extinguishment of trust preferred securities
|
(10,857
|
)
|
||||||||||||||
|
Preferred stock dividends and discount accretion
|
(1,135
|
)
|
(1,476
|
)
|
(3,981
|
)
|
(5,239
|
)
|
||||||||
|
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS
|
$
|
6,426
|
$
|
2,555
|
$
|
9,013
|
$
|
11,722
|
||||||||
|
Per Share Data:
|
||||||||||||||||
|
Basic Net Income Available to Common Stockholders
|
$
|
0.24
|
$
|
0.10
|
$
|
0.34
|
$
|
0.48
|
||||||||
|
Diluted Net Income Available to Common Stockholders
|
$
|
0.24
|
$
|
0.10
|
$
|
0.34
|
$
|
0.48
|
||||||||
|
Cash Dividends Paid
|
$
|
0.01
|
$
|
0.01
|
$
|
0.04
|
$
|
0.04
|
||||||||
|
Average Diluted Shares Outstanding (in thousands)
|
28,700
|
25,737
|
26,694
|
24,642
|
||||||||||||
|
FINANCIAL HIGHLIGHTS
|
||||||||||||||||
|
(Dollars in thousands)
|
Three Months Ended
|
Twelve Months Ended
|
||||||||||||||
|
December 31,
|
December 31,
|
|||||||||||||||
|
2011
|
2010
|
2011
|
2010
|
|||||||||||||
|
NET CHARGE OFF'S
|
$
|
8,031
|
$
|
7,761
|
$
|
34,709
|
$
|
55,637
|
||||||||
|
AVERAGE BALANCES:
|
||||||||||||||||
|
Total Assets
|
$
|
4,200,685
|
$
|
4,249,194
|
$
|
4,143,850
|
$
|
4,271,715
|
||||||||
|
Total Loans
|
2,719,155
|
2,893,657
|
2,748,684
|
3,050,850
|
||||||||||||
|
Total Earning Assets
|
3,766,352
|
3,835,814
|
3,744,027
|
3,862,493
|
||||||||||||
|
Total Deposits
|
3,165,505
|
3,323,209
|
3,175,762
|
3,337,747
|
||||||||||||
|
Total Stockholders' Equity
|
513,366
|
464,250
|
478,440
|
470,379
|
||||||||||||
|
FINANCIAL RATIOS:
|
||||||||||||||||
|
Return on Average Assets
|
0.61
|
%
|
0.24
|
%
|
0.22
|
%
|
0.27
|
%
|
||||||||
|
Return on Average Stockholders' Equity
|
5.01
|
2.20
|
1.88
|
2.49
|
||||||||||||
|
Average Earning Assets to Average Assets
|
89.66
|
90.27
|
90.35
|
90.42
|
||||||||||||
|
Allowance for Loan Losses as % of Total Loans
|
2.60
|
2.90
|
2.60
|
2.90
|
||||||||||||
|
Net Charge Off's as % of Average Loans (Annualized)
|
1.18
|
1.07
|
1.26
|
1.82
|
||||||||||||
|
Average Stockholders' Equity to Average Assets
|
12.22
|
10.93
|
11.55
|
11.01
|
||||||||||||
|
Tax Equivalent Yield on Earning Assets
|
4.83
|
5.13
|
4.99
|
5.32
|
||||||||||||
|
Cost of Supporting Liabilities
|
0.84
|
1.30
|
1.01
|
1.45
|
||||||||||||
|
Net Interest Margin (FTE) on Earning Assets
|
3.99
|
3.83
|
3.98
|
3.87
|
||||||||||||
|
NON-PERFORMING ASSETS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2011
|
2011
|
2011
|
2011
|
2010
|
||||||||||||||||
|
Non-Accrual Loans
|
$
|
69,592
|
$
|
78,933
|
$
|
87,583
|
$
|
87,712
|
$
|
90,591
|
||||||||||
|
Renegotiated Loans
|
14,308
|
6,701
|
6,269
|
2,125
|
7,139
|
|||||||||||||||
|
Non-Performing Loans (NPL)
|
83,900
|
85,634
|
93,852
|
89,837
|
97,730
|
|||||||||||||||
|
Real Estate Owned and Repossessed Assets
|
16,289
|
19,425
|
15,437
|
17,056
|
20,927
|
|||||||||||||||
|
Non-Performing Assets (NPA)
|
100,189
|
105,059
|
109,289
|
106,893
|
118,657
|
|||||||||||||||
|
90+ Days Delinquent
|
580
|
1,595
|
227
|
752
|
1,330
|
|||||||||||||||
|
NPAS & 90 Day Delinquent
|
$
|
100,769
|
$
|
106,654
|
$
|
109,516
|
$
|
107,645
|
$
|
119,987
|
||||||||||
|
Loan Loss Reserve
|
$
|
70,898
|
$
|
73,074
|
$
|
77,133
|
$
|
80,936
|
$
|
82,977
|
||||||||||
|
YTD Charge-offs
|
34,709
|
26,678
|
17,063
|
7,635
|
55,637
|
|||||||||||||||
|
NPAs / Actual Assets %
|
2.40
|
%
|
2.55
|
%
|
2.67
|
%
|
2.60
|
%
|
2.84
|
%
|
||||||||||
|
NPAs & 90 Day / Actual Assets %
|
2.41
|
%
|
2.59
|
%
|
2.67
|
%
|
2.61
|
%
|
2.88
|
%
|
||||||||||
|
NPAs / Actual Loans and REO %
|
3.65
|
%
|
3.83
|
%
|
3.98
|
%
|
3.84
|
%
|
4.12
|
%
|
||||||||||
|
Loan Loss Reserves / Actual Loans (%)
|
2.60
|
%
|
2.68
|
%
|
2.83
|
%
|
2.93
|
%
|
2.90
|
%
|
||||||||||
|
NCOs / YTD Average Loans (%)
|
1.26
|
%
|
0.97
|
%
|
0.61
|
%
|
0.27
|
%
|
1.82
|
%
|
||||||||||
|
CONSOLIDATED BALANCE SHEETS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2011
|
2011
|
2011
|
2011
|
2010
|
||||||||||||||||
|
ASSETS
|
||||||||||||||||||||
|
Cash and due from banks
|
$
|
73,312
|
$
|
60,166
|
$
|
50,874
|
$
|
44,283
|
$
|
50,844
|
||||||||||
|
Federal funds sold
|
6,092
|
7,463
|
||||||||||||||||||
|
Cash and cash equivalents
|
73,312
|
60,166
|
50,874
|
50,375
|
58,307
|
|||||||||||||||
|
Interest-bearing time deposits
|
52,851
|
16,115
|
15,865
|
61,843
|
65,216
|
|||||||||||||||
|
Investment securities
|
946,400
|
937,828
|
938,366
|
886,029
|
826,797
|
|||||||||||||||
|
Mortgage loans held for sale
|
17,864
|
12,257
|
4,846
|
2,111
|
21,469
|
|||||||||||||||
|
Loans
|
2,713,415
|
2,712,938
|
2,724,022
|
2,764,128
|
2,835,683
|
|||||||||||||||
|
Less: Allowance for loan losses
|
(70,898
|
)
|
(73,074
|
)
|
(77,133
|
)
|
(80,936
|
)
|
(82,977
|
)
|
||||||||||
|
Net loans
|
2,642,517
|
2,639,864
|
2,646,889
|
2,683,192
|
2,752,706
|
|||||||||||||||
|
Premises and equipment
|
51,013
|
51,432
|
51,851
|
51,818
|
52,450
|
|||||||||||||||
|
Federal Reserve and Federal Home Loan Bank stock
|
31,270
|
31,381
|
31,384
|
33,801
|
33,884
|
|||||||||||||||
|
Interest receivable
|
17,723
|
17,770
|
17,001
|
17,583
|
18,674
|
|||||||||||||||
|
Core deposit intangibles and goodwill
|
150,471
|
151,062
|
151,817
|
152,918
|
154,019
|
|||||||||||||||
|
Cash surrender value of life insurance
|
124,329
|
123,524
|
102,880
|
102,309
|
96,731
|
|||||||||||||||
|
Other real estate owned
|
16,289
|
19,425
|
15,437
|
17,056
|
20,927
|
|||||||||||||||
|
Tax asset, deferred and receivable
|
36,424
|
35,804
|
36,790
|
38,224
|
45,623
|
|||||||||||||||
|
Other assets
|
12,613
|
21,881
|
30,218
|
19,916
|
24,045
|
|||||||||||||||
|
TOTAL ASSETS
|
$
|
4,173,076
|
$
|
4,118,509
|
$
|
4,094,218
|
$
|
4,117,175
|
$
|
4,170,848
|
||||||||||
|
LIABILITIES
|
||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||
|
Noninterest-bearing
|
$
|
646,508
|
$
|
598,139
|
$
|
590,199
|
$
|
586,973
|
$
|
583,696
|
||||||||||
|
Interest-bearing
|
2,488,147
|
2,466,111
|
2,552,334
|
2,565,363
|
2,685,184
|
|||||||||||||||
|
Total Deposits
|
3,134,655
|
3,064,250
|
3,142,533
|
3,152,336
|
3,268,880
|
|||||||||||||||
|
Borrowings:
|
||||||||||||||||||||
|
Federal funds purchased
|
27,946
|
22,978
|
||||||||||||||||||
|
Securities sold under repurchase agreements
|
156,305
|
117,097
|
124,236
|
115,684
|
109,871
|
|||||||||||||||
|
Federal Home Loan Bank advances
|
138,095
|
168,764
|
74,050
|
104,697
|
82,684
|
|||||||||||||||
|
Subordinated debentures, revolving credit lines and term loans
|
194,974
|
194,961
|
226,580
|
226,400
|
226,440
|
|||||||||||||||
|
Total Borrowings
|
489,374
|
508,768
|
447,844
|
446,781
|
418,995
|
|||||||||||||||
|
Interest payable
|
2,925
|
2,186
|
3,601
|
3,117
|
4,262
|
|||||||||||||||
|
Other liabilities
|
31,655
|
30,760
|
31,762
|
52,419
|
24,303
|
|||||||||||||||
|
Total Liabilities
|
3,658,609
|
3,605,964
|
3,625,740
|
3,654,653
|
3,716,440
|
|||||||||||||||
|
STOCKHOLDERS' EQUITY
|
||||||||||||||||||||
|
Preferred Stock, no-par value:
|
||||||||||||||||||||
|
Authorized -- 500,000 shares
|
||||||||||||||||||||
|
Series A, Issued and outstanding
|
68,118
|
67,998
|
67,880
|
|||||||||||||||||
|
Preferred Stock, no-par value, $1,000 liquidation value:
|
||||||||||||||||||||
|
Authorized -- 500,000 shares
|
||||||||||||||||||||
|
Senior Non-Cumulative Perpetual Preferred Stock, Series B
|
||||||||||||||||||||
|
Issued and outstanding
|
90,783
|
90,783
|
||||||||||||||||||
|
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
|
||||||||||||||||||||
|
Authorized -- 600 shares
|
||||||||||||||||||||
|
Issued and outstanding
|
125
|
125
|
125
|
125
|
125
|
|||||||||||||||
|
Common Stock, $.125 stated value:
|
||||||||||||||||||||
|
Authorized -- 50,000,000 shares
|
||||||||||||||||||||
|
Issued and outstanding
|
3,570
|
3,567
|
3,211
|
3,206
|
3,197
|
|||||||||||||||
|
Additional paid-in capital
|
254,874
|
254,801
|
233,544
|
233,032
|
232,503
|
|||||||||||||||
|
Retained earnings
|
168,717
|
162,669
|
169,313
|
165,075
|
160,860
|
|||||||||||||||
|
Accumulated other comprehensive income (loss)
|
(3,602
|
)
|
600
|
(5,833
|
)
|
(6,914
|
)
|
(10,157
|
)
|
|||||||||||
|
Total Stockholders' Equity
|
514,467
|
512,545
|
468,478
|
462,522
|
454,408
|
|||||||||||||||
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
|
4,173,076
|
$
|
4,118,509
|
$
|
4,094,218
|
$
|
4,117,175
|
$
|
4,170,848
|
||||||||||
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||||||
|
(Dollars in thousands, except per share amounts)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2011
|
2011
|
2011
|
2011
|
2010
|
||||||||||||||||
|
INTEREST INCOME
|
||||||||||||||||||||
|
Loans receivable:
|
||||||||||||||||||||
|
Taxable
|
$
|
36,497
|
$
|
37,024
|
$
|
37,457
|
$
|
38,738
|
$
|
41,497
|
||||||||||
|
Tax exempt
|
93
|
86
|
247
|
102
|
(250
|
)
|
||||||||||||||
|
Investment securities:
|
||||||||||||||||||||
|
Taxable
|
4,565
|
5,078
|
5,040
|
4,547
|
3,680
|
|||||||||||||||
|
Tax exempt
|
2,550
|
2,529
|
2,535
|
2,553
|
2,573
|
|||||||||||||||
|
Federal funds sold
|
1
|
2
|
3
|
|||||||||||||||||
|
Deposits with financial institutions
|
54
|
45
|
100
|
83
|
142
|
|||||||||||||||
|
Federal Reserve and Federal Home Loan Bank stock
|
314
|
323
|
341
|
341
|
312
|
|||||||||||||||
|
Total Interest Income
|
44,073
|
45,085
|
45,721
|
46,366
|
47,957
|
|||||||||||||||
|
INTEREST EXPENSE
|
||||||||||||||||||||
|
Deposits
|
4,505
|
5,046
|
5,864
|
6,866
|
8,427
|
|||||||||||||||
|
Federal funds purchased
|
3
|
16
|
3
|
3
|
||||||||||||||||
|
Securities sold under repurchase agreements
|
363
|
384
|
386
|
378
|
383
|
|||||||||||||||
|
Federal Home Loan Bank advances
|
1,114
|
1,089
|
977
|
1,001
|
1,146
|
|||||||||||||||
|
Subordinated debentures, revolving credit lines and term loans
|
1,908
|
2,699
|
2,644
|
2,641
|
2,508
|
|||||||||||||||
|
Total Interest Expense
|
7,893
|
9,234
|
9,874
|
10,889
|
12,464
|
|||||||||||||||
|
NET INTEREST INCOME
|
36,180
|
35,851
|
35,847
|
35,477
|
35,493
|
|||||||||||||||
|
Provision for loan losses
|
5,855
|
5,556
|
5,625
|
5,594
|
7,078
|
|||||||||||||||
|
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES
|
30,325
|
30,295
|
30,222
|
29,883
|
28,415
|
|||||||||||||||
|
OTHER INCOME
|
||||||||||||||||||||
|
Service charges on deposit accounts
|
3,027
|
3,169
|
2,997
|
2,779
|
3,111
|
|||||||||||||||
|
Fiduciary activities
|
1,804
|
1,881
|
1,929
|
2,036
|
1,881
|
|||||||||||||||
|
Other customer fees
|
2,572
|
2,583
|
2,634
|
2,235
|
2,217
|
|||||||||||||||
|
Commission income
|
1,220
|
1,528
|
1,024
|
1,888
|
1,267
|
|||||||||||||||
|
Earnings on cash surrender value of life insurance
|
803
|
644
|
571
|
578
|
524
|
|||||||||||||||
|
Net gains and fees on sales of loans
|
2,747
|
1,768
|
1,030
|
1,873
|
2,384
|
|||||||||||||||
|
Net realized gains on sales of available for sale securities
|
290
|
861
|
825
|
463
|
1,305
|
|||||||||||||||
|
Other-than-temporary impairment on available for sale securities
|
(400
|
)
|
||||||||||||||||||
|
Other income
|
508
|
796
|
51
|
406
|
904
|
|||||||||||||||
|
Total Other Income
|
12,971
|
13,230
|
11,061
|
11,858
|
13,593
|
|||||||||||||||
|
OTHER EXPENSES
|
||||||||||||||||||||
|
Salaries and employee benefits
|
19,035
|
19,964
|
18,560
|
17,176
|
19,655
|
|||||||||||||||
|
Net occupancy
|
2,428
|
2,530
|
2,415
|
2,745
|
2,452
|
|||||||||||||||
|
Equipment
|
1,672
|
1,662
|
1,677
|
1,783
|
1,812
|
|||||||||||||||
|
Marketing
|
650
|
534
|
436
|
382
|
527
|
|||||||||||||||
|
Outside data processing fees
|
1,377
|
1,391
|
1,458
|
1,445
|
1,154
|
|||||||||||||||
|
Printing and office supplies
|
340
|
301
|
313
|
288
|
317
|
|||||||||||||||
|
Core deposit amortization
|
591
|
755
|
1,101
|
1,101
|
1,161
|
|||||||||||||||
|
FDIC assessments
|
775
|
1,201
|
1,451
|
2,104
|
2,044
|
|||||||||||||||
|
Other real estate owned and credit-related expenses
|
2,569
|
2,007
|
2,843
|
3,195
|
5,257
|
|||||||||||||||
|
Other expenses
|
3,999
|
3,877
|
4,145
|
3,662
|
3,814
|
|||||||||||||||
|
Total Other Expenses
|
33,436
|
34,222
|
34,399
|
33,881
|
38,193
|
|||||||||||||||
|
INCOME BEFORE INCOME TAX
|
9,860
|
9,303
|
6,884
|
7,860
|
3,815
|
|||||||||||||||
|
Income tax expense (benefit)
|
2,299
|
2,561
|
1,396
|
2,399
|
(216
|
)
|
||||||||||||||
|
NET INCOME
|
7,561
|
6,742
|
5,488
|
5,461
|
4,031
|
|||||||||||||||
|
Loss on CPP unamortized discount
|
(1,401
|
)
|
||||||||||||||||||
|
Loss on extinguishment of trust preferred securities
|
(10,857
|
)
|
||||||||||||||||||
|
Preferred stock dividends and discount accretion
|
(1,135
|
)
|
(868
|
)
|
(990
|
)
|
(988
|
)
|
(1,476
|
)
|
||||||||||
|
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS
|
$
|
6,426
|
$
|
(6,384
|
)
|
$
|
4,498
|
$
|
4,473
|
$
|
2,555
|
|||||||||
|
PER SHARE:
|
||||||||||||||||||||
|
Basic Net Income (Loss) Available to Common Stockholders
|
$
|
0.24
|
$
|
(0.25
|
)
|
$
|
0.18
|
$
|
0.17
|
$
|
0.10
|
|||||||||
|
Diluted Net Income (Loss) Available to Common Stockholders
|
$
|
0.24
|
$
|
(0.25
|
)
|
$
|
0.18
|
$
|
0.17
|
$
|
0.10
|
|||||||||
|
Cash Dividends Paid
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
$
|
0.01
|
||||||||||
|
Average Diluted Shares Outstanding (in thousands)
|
28,700
|
26,367
|
25,783
|
25,763
|
25,737
|
|||||||||||||||
|
FINANCIAL RATIOS:
|
||||||||||||||||||||
|
Return on Average Assets
|
0.61
|
%
|
-0.62
|
%
|
0.43
|
%
|
0.43
|
%
|
0.24
|
%
|
||||||||||
|
Return on Average Stockholders' Equity
|
5.01
|
(5.33
|
)
|
3.87
|
3.92
|
2.20
|
||||||||||||||
|
Average Earning Assets to Average Assets
|
89.66
|
90.30
|
90.64
|
90.83
|
90.27
|
|||||||||||||||
|
Allowance for Loan Losses as % of Total Loans
|
2.60
|
2.68
|
2.83
|
2.93
|
2.90
|
|||||||||||||||
|
Net Charge Off's as % of Average Loans (Annualized)
|
1.18
|
1.41
|
1.37
|
1.09
|
1.07
|
|||||||||||||||
|
Average Stockholders' Equity to Average Assets
|
12.22
|
11.64
|
11.23
|
11.07
|
10.93
|
|||||||||||||||
|
Tax Equivalent Yield on Earning Assets
|
4.83
|
5.01
|
5.04
|
5.11
|
5.13
|
|||||||||||||||
|
Cost of Supporting Liabilities
|
0.84
|
0.99
|
1.05
|
1.16
|
1.30
|
|||||||||||||||
|
Net Interest Margin (FTE) on Earning Assets
|
3.99
|
4.02
|
3.99
|
3.95
|
3.83
|
|||||||||||||||
|
LOANS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2011
|
2011
|
2011
|
2011
|
2010
|
||||||||||||||||
|
Commercial and industrial loans
|
$
|
532,523
|
$
|
518,848
|
$
|
529,742
|
$
|
529,110
|
$
|
530,322
|
||||||||||
|
Agricultural production financing and other loans to farmers
|
104,526
|
106,761
|
99,360
|
89,032
|
95,516
|
|||||||||||||||
|
Real estate loans:
|
||||||||||||||||||||
|
Construction
|
81,780
|
70,044
|
96,308
|
103,956
|
106,615
|
|||||||||||||||
|
Commercial and farm land
|
1,194,230
|
1,196,270
|
1,171,901
|
1,199,078
|
1,229,037
|
|||||||||||||||
|
Residential
|
481,493
|
495,954
|
495,256
|
504,538
|
522,051
|
|||||||||||||||
|
Home Equity
|
191,631
|
196,191
|
191,839
|
195,235
|
201,969
|
|||||||||||||||
|
Individuals' loans for household and other personal expenditures
|
84,172
|
90,810
|
94,123
|
104,701
|
115,295
|
|||||||||||||||
|
Lease financing receivables, net of unearned income
|
3,555
|
4,160
|
4,399
|
4,706
|
5,157
|
|||||||||||||||
|
Other loans
|
39,505
|
33,900
|
41,094
|
33,772
|
29,721
|
|||||||||||||||
|
Loans
|
2,713,415
|
2,712,938
|
2,724,022
|
2,764,128
|
2,835,683
|
|||||||||||||||
|
Allowance for loan losses
|
(70,898
|
)
|
(73,074
|
)
|
(77,133
|
)
|
(80,936
|
)
|
(82,977
|
)
|
||||||||||
|
NET LOANS
|
$
|
2,642,517
|
$
|
2,639,864
|
$
|
2,646,889
|
$
|
2,683,192
|
$
|
2,752,706
|
||||||||||
|
DEPOSITS
|
||||||||||||||||||||
|
(Dollars in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||||||||||||||
|
2011
|
2011
|
2011
|
2011
|
2010
|
||||||||||||||||
|
Demand deposits
|
$
|
1,438,513
|
$
|
1,360,174
|
$
|
1,363,621
|
$
|
1,318,188
|
$
|
1,362,927
|
||||||||||
|
Savings deposits
|
757,166
|
712,545
|
750,337
|
765,138
|
763,949
|
|||||||||||||||
|
Certificates and other time deposits of $100,000 or more
|
264,787
|
278,115
|
292,613
|
318,663
|
334,748
|
|||||||||||||||
|
Other certificates and time deposits
|
551,247
|
570,380
|
597,330
|
624,032
|
661,569
|
|||||||||||||||
|
Brokered deposits
|
122,942
|
143,036
|
138,632
|
126,315
|
145,687
|
|||||||||||||||
|
TOTAL DEPOSITS
|
$
|
3,134,655
|
$
|
3,064,250
|
$
|
3,142,533
|
$
|
3,152,336
|
$
|
3,268,880
|
||||||||||