(Mark One) | ||||
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended OR | |||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||
Missouri (State of Incorporation) | 43-0889454 (IRS Employer Identification No.) | |
1000 Walnut, Kansas City, MO (Address of principal executive offices) | 64106 (Zip Code) | |
(816) 234-2000 (Registrant’s telephone number, including area code) |
2
2
Item 1. | FINANCIAL STATEMENTS |
September 30 | December 31 | |||||||
(In thousands) | 2006 | 2005 | ||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Loans, net of unearned income | $ | 9,833,190 | $ | 8,899,183 | ||||
Allowance for loan losses | (131,834 | ) | (128,447 | ) | ||||
Net loans | 9,701,356 | 8,770,736 | ||||||
Investment securities: | ||||||||
Available for sale (pledged to creditors $532,529,000 in 2006) | 3,533,073 | 3,667,901 | ||||||
Trading | 7,770 | 24,959 | ||||||
Non-marketable | 87,301 | 77,321 | ||||||
Total investment securities | 3,628,144 | 3,770,181 | ||||||
Federal funds sold and securities purchased under agreements to resell | 495,262 | 128,862 | ||||||
Cash and due from banks | 479,963 | 545,273 | ||||||
Land, buildings and equipment, net | 388,337 | 374,192 | ||||||
Goodwill | 100,933 | 48,522 | ||||||
Other intangible assets, net | 13,325 | 47 | ||||||
Other assets | 344,292 | 247,732 | ||||||
Total assets | $ | 15,151,612 | $ | 13,885,545 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Deposits: | ||||||||
Non-interest bearing demand | $ | 1,205,193 | $ | 1,399,934 | ||||
Savings, interest checking and money market | 6,704,679 | 6,490,326 | ||||||
Time open and C.D.’s of less than $100,000 | 2,286,426 | 1,831,980 | ||||||
Time open and C.D.’s of $100,000 and over | 1,368,140 | 1,129,573 | ||||||
Total deposits | 11,564,438 | 10,851,813 | ||||||
Federal funds purchased and securities sold under agreements to repurchase | 1,768,899 | 1,326,427 | ||||||
Other borrowings | 166,372 | 269,390 | ||||||
Other liabilities | 192,116 | 100,077 | ||||||
Total liabilities | 13,691,825 | 12,547,707 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock, $1 par value Authorized and unissued 2,000,000 shares | — | — | ||||||
Common stock, $5 par value Authorized 100,000,000 shares; issued 69,409,882 shares | 347,049 | 347,049 | ||||||
Capital surplus | 384,343 | 388,552 | ||||||
Retained earnings | 806,551 | 693,021 | ||||||
Treasury stock of 1,673,892 shares in 2006 and 1,716,413 shares in 2005, at cost | (84,616 | ) | (86,901 | ) | ||||
Accumulated other comprehensive income (loss) | 6,460 | (3,883 | ) | |||||
Total stockholders’ equity | 1,459,787 | 1,337,838 | ||||||
Total liabilities and stockholders’ equity | $ | 15,151,612 | $ | 13,885,545 | ||||
June 30 | December 31 | |||||||||
(In thousands) | 2006 | 2005 | ||||||||
(Unaudited) | ||||||||||
ASSETS | ||||||||||
Loans, net of unearned income | $ | 9,379,893 | $ | 8,899,183 | ||||||
Allowance for loan losses | (128,446 | ) | (128,447 | ) | ||||||
Net loans | 9,251,447 | 8,770,736 | ||||||||
Investment securities: | ||||||||||
Available for sale | 3,337,477 | 3,667,901 | ||||||||
Trading | 17,001 | 24,959 | ||||||||
Non-marketable | 81,401 | 77,321 | ||||||||
Total investment securities | 3,435,879 | 3,770,181 | ||||||||
Federal funds sold and securities purchased under agreements to resell | 237,072 | 128,862 | ||||||||
Cash and due from banks | 662,790 | 545,273 | ||||||||
Land, buildings and equipment, net | 367,954 | 374,192 | ||||||||
Goodwill | 48,522 | 48,522 | ||||||||
Other assets | 269,733 | 247,779 | ||||||||
Total assets | $ | 14,273,397 | $ | 13,885,545 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
Deposits: | ||||||||||
Non-interest bearing demand | $ | 1,326,787 | $ | 1,399,934 | ||||||
Savings, interest checking and money market | 6,439,068 | 6,490,326 | ||||||||
Time open and C.D.’s of less than $100,000 | 2,028,700 | 1,831,980 | ||||||||
Time open and C.D.’s of $100,000 and over | 1,247,790 | 1,129,573 | ||||||||
Total deposits | 11,042,345 | 10,851,813 | ||||||||
Federal funds purchased and securities sold under agreements to repurchase | 1,586,511 | 1,326,427 | ||||||||
Other borrowings | 144,919 | 269,390 | ||||||||
Other liabilities | 168,227 | 100,077 | ||||||||
Total liabilities | 12,942,002 | 12,547,707 | ||||||||
Stockholders’ equity: | ||||||||||
Preferred stock, $1 par value | ||||||||||
Authorized and unissued 2,000,000 shares | — | — | ||||||||
Common stock, $5 par value | ||||||||||
Authorized 100,000,000 shares; issued 69,409,882 shares | 347,049 | 347,049 | ||||||||
Capital surplus | 385,358 | 388,552 | ||||||||
Retained earnings | 768,608 | 693,021 | ||||||||
Treasury stock of 3,009,713 shares in 2006 and 1,716,413 shares in 2005, at cost | (152,189 | ) | (86,901 | ) | ||||||
Accumulated other comprehensive loss | (17,431 | ) | (3,883 | ) | ||||||
Total stockholders’ equity | 1,331,395 | 1,337,838 | ||||||||
Total liabilities and stockholders’ equity | $ | 14,273,397 | $ | 13,885,545 | ||||||
3
3
For the Three Months | For the Nine Months | |||||||||||||||
Ended September 30 | Ended September 30 | |||||||||||||||
(In thousands, except per share data) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
(Unaudited) | ||||||||||||||||
INTEREST INCOME | ||||||||||||||||
Interest and fees on loans | $ | 173,400 | $ | 134,653 | $ | 484,462 | $ | 378,418 | ||||||||
Interest on investment securities | 37,791 | 42,722 | 111,182 | 130,862 | ||||||||||||
Interest on federal funds sold and securities purchased under agreements to resell | 5,079 | 1,195 | 8,503 | 2,943 | ||||||||||||
Total interest income | 216,270 | 178,570 | 604,147 | 512,223 | ||||||||||||
INTEREST EXPENSE | ||||||||||||||||
Interest on deposits: | ||||||||||||||||
Savings, interest checking and money market | 26,301 | 14,461 | 68,910 | 37,110 | ||||||||||||
Time open and C.D.’s of less than $100,000 | 23,238 | 13,351 | 59,417 | 35,794 | ||||||||||||
Time open and C.D.’s of $100,000 and over | 15,706 | 7,409 | 42,799 | 21,734 | ||||||||||||
Interest on federal funds purchased and securities sold under agreements to repurchase | 20,287 | 14,215 | 46,892 | 33,796 | ||||||||||||
Interest on other borrowings | 1,985 | 3,302 | 7,162 | 9,093 | ||||||||||||
Total interest expense | 87,517 | 52,738 | 225,180 | 137,527 | ||||||||||||
Net interest income | 128,753 | 125,832 | 378,967 | 374,696 | ||||||||||||
Provision for loan losses | 7,575 | 8,934 | 17,679 | 16,805 | ||||||||||||
Net interest income after provision for loan losses | 121,178 | 116,898 | 361,288 | 357,891 | ||||||||||||
NON-INTEREST INCOME | ||||||||||||||||
Deposit account charges and other fees | 29,723 | 31,117 | 86,130 | 82,894 | ||||||||||||
Bank card transaction fees | 24,187 | 21,981 | 69,453 | 62,783 | ||||||||||||
Trust fees | 17,805 | 17,353 | 53,616 | 50,787 | ||||||||||||
Trading account profits and commissions | 1,639 | 2,335 | 6,214 | 7,399 | ||||||||||||
Consumer brokerage services | 2,476 | 2,440 | 7,636 | 7,603 | ||||||||||||
Loan fees and sales | 1,956 | 2,397 | 8,444 | 10,642 | ||||||||||||
Investment securities gains, net | 3,324 | 289 | 9,011 | 5,273 | ||||||||||||
Other | 9,546 | 8,983 | �� | 31,063 | 25,185 | |||||||||||
Total non-interest income | 90,656 | 86,895 | 271,567 | 252,566 | ||||||||||||
NON-INTEREST EXPENSE | ||||||||||||||||
Salaries and employee benefits | 72,169 | 66,682 | 215,133 | 204,447 | ||||||||||||
Net occupancy | 11,009 | 10,277 | 32,216 | 29,582 | ||||||||||||
Equipment | 7,109 | 5,838 | 19,129 | 17,230 | ||||||||||||
Supplies and communication | 8,073 | 8,458 | 24,338 | 24,928 | ||||||||||||
Data processing and software | 12,904 | 12,108 | 37,928 | 35,632 | ||||||||||||
Marketing | 4,397 | 4,486 | 13,372 | 13,035 | ||||||||||||
Other | 16,643 | 14,538 | 49,699 | 44,467 | ||||||||||||
Total non-interest expense | 132,304 | 122,387 | 391,815 | 369,321 | ||||||||||||
Income before income taxes | 79,530 | 81,406 | 241,040 | 241,136 | ||||||||||||
Less income taxes | 24,982 | 18,615 | 78,215 | 74,131 | ||||||||||||
Net income | $ | 54,548 | $ | 62,791 | $ | 162,825 | $ | 167,005 | ||||||||
Net income per share – basic | $ | .82 | $ | .90 | $ | 2.44 | $ | 2.38 | ||||||||
Net income per share – diluted | $ | .81 | $ | .89 | $ | 2.41 | $ | 2.35 | ||||||||
For the Three Months | For the Six Months | ||||||||||||||||
Ended June 30 | Ended June 30 | ||||||||||||||||
(In thousands, except per share data) | 2006 | 2005 | 2006 | 2005 | |||||||||||||
(Unaudited) | |||||||||||||||||
INTEREST INCOME | |||||||||||||||||
Interest and fees on loans | $ | 161,188 | $ | 125,242 | $ | 311,062 | $ | 243,765 | |||||||||
Interest on investment securities | 36,261 | 46,394 | 73,391 | 88,140 | |||||||||||||
Interest on federal funds sold and securities purchased under agreements to resell | 1,801 | 1,164 | 3,424 | 1,748 | |||||||||||||
Total interest income | 199,250 | 172,800 | 387,877 | 333,653 | |||||||||||||
INTEREST EXPENSE | |||||||||||||||||
Interest on deposits: | |||||||||||||||||
Savings, interest checking and money market | 23,002 | 12,192 | 42,609 | 22,649 | |||||||||||||
Time open and C.D.’s of less than $100,000 | 19,448 | 12,051 | 36,179 | 22,443 | |||||||||||||
Time open and C.D.’s of $100,000 and over | 13,906 | 7,973 | 27,093 | 14,325 | |||||||||||||
Interest on federal funds purchased and securities sold under agreements to repurchase | 14,024 | 10,163 | 26,605 | 19,581 | |||||||||||||
Interest on other borrowings | 2,391 | 3,034 | 5,177 | 5,791 | |||||||||||||
Total interest expense | 72,771 | 45,413 | 137,663 | 84,789 | |||||||||||||
Net interest income | 126,479 | 127,387 | 250,214 | 248,864 | |||||||||||||
Provision for loan losses | 5,672 | 5,503 | 10,104 | 7,871 | |||||||||||||
Net interest income after provision for loan losses | 120,807 | 121,884 | 240,110 | 240,993 | |||||||||||||
NON-INTEREST INCOME | |||||||||||||||||
Deposit account charges and other fees | 28,910 | 27,476 | 56,407 | 51,777 | |||||||||||||
Bank card transaction fees | 23,558 | 21,295 | 45,266 | 40,802 | |||||||||||||
Trust fees | 17,992 | 17,040 | 35,811 | 33,434 | |||||||||||||
Trading account profits and commissions | 2,010 | 2,450 | 4,575 | 5,064 | |||||||||||||
Consumer brokerage services | 2,771 | 2,338 | 5,160 | 5,163 | |||||||||||||
Loan fees and sales | 2,745 | 4,805 | 6,488 | 8,245 | |||||||||||||
Investment securities gains, net | 3,284 | 1,372 | 5,687 | 4,984 | |||||||||||||
Other | 10,193 | 8,204 | 21,517 | 16,202 | |||||||||||||
Total non-interest income | 91,463 | 84,980 | 180,911 | 165,671 | |||||||||||||
NON-INTEREST EXPENSE | |||||||||||||||||
Salaries and employee benefits | 71,239 | 67,585 | 142,964 | 137,765 | |||||||||||||
Net occupancy | 10,230 | 9,527 | 21,207 | 19,305 | |||||||||||||
Equipment | 6,071 | 5,701 | 12,020 | 11,392 | |||||||||||||
Supplies and communication | 7,872 | 8,257 | 16,265 | 16,470 | |||||||||||||
Data processing and software | 12,631 | 12,069 | 25,024 | 23,524 | |||||||||||||
Marketing | 4,657 | 4,687 | 8,975 | 8,549 | |||||||||||||
Other | 16,850 | 15,186 | 33,056 | 29,929 | |||||||||||||
Total non-interest expense | 129,550 | 123,012 | 259,511 | 246,934 | |||||||||||||
Income before income taxes | 82,720 | 83,852 | 161,510 | 159,730 | |||||||||||||
Less income taxes | 27,387 | 29,484 | 53,233 | 55,516 | |||||||||||||
Net income | $ | 55,333 | $ | 54,368 | $ | 108,277 | $ | 104,214 | |||||||||
Net income per share – basic | $ | .83 | $ | .78 | $ | 1.62 | $ | 1.48 | |||||||||
Net income per share – diluted | $ | .82 | $ | .77 | $ | 1.60 | $ | 1.46 | |||||||||
4
4
Accumulated | ||||||||||||||||||||||||||||
Number | Other | |||||||||||||||||||||||||||
of | Comprehensive | |||||||||||||||||||||||||||
(Dollars in thousands, | Shares | Common | Capital | Retained | Treasury | Income | ||||||||||||||||||||||
except per share data) | Issued | Stock | Surplus | Earnings | Stock | (Loss) | Total | |||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
Balance January 1, 2006 | 69,409,882 | $ | 347,049 | $ | 388,552 | $ | 693,021 | $ | (86,901 | ) | $ | (3,883 | ) | $ | 1,337,838 | |||||||||||||
Net income | 162,825 | 162,825 | ||||||||||||||||||||||||||
Change in unrealized gain (loss) on available for sale securities, net of tax | 10,343 | 10,343 | ||||||||||||||||||||||||||
Total comprehensive income | 173,168 | |||||||||||||||||||||||||||
Acquisition of West Pointe Bancorp, Inc. | (1,268 | ) | 68,752 | 67,484 | ||||||||||||||||||||||||
Purchase of treasury stock | (79,885 | ) | (79,885 | ) | ||||||||||||||||||||||||
Issuance of stock under purchase and equity compensation plans | (6,309 | ) | 12,245 | 5,936 | ||||||||||||||||||||||||
Net tax benefit related to equity compensation plans | 1,178 | 1,178 | ||||||||||||||||||||||||||
Stock-based compensation | 3,363 | 3,363 | ||||||||||||||||||||||||||
Issuance of nonvested stock awards | (1,173 | ) | 1,173 | — | ||||||||||||||||||||||||
Cash dividends paid ($.735 per share) | (49,295 | ) | (49,295 | ) | ||||||||||||||||||||||||
Balance September 30, 2006 | 69,409,882 | $ | 347,049 | $ | 384,343 | $ | 806,551 | $ | (84,616 | ) | $ | 6,460 | $ | 1,459,787 | ||||||||||||||
Balance January 1, 2005 | 69,409,882 | $ | 347,049 | $ | 388,614 | $ | 703,293 | $ | (51,646 | ) | $ | 39,570 | $ | 1,426,880 | ||||||||||||||
Net income | 167,005 | 167,005 | ||||||||||||||||||||||||||
Change in unrealized gain (loss) on available for sale securities, net of tax | (33,524 | ) | (33,524 | ) | ||||||||||||||||||||||||
Total comprehensive income | 133,481 | |||||||||||||||||||||||||||
Purchase of treasury stock | (173,004 | ) | (173,004 | ) | ||||||||||||||||||||||||
Issuance of stock under purchase and equity compensation plans | (14,608 | ) | 30,511 | 15,903 | ||||||||||||||||||||||||
Net tax benefit related to equity compensation plans | 3,286 | 3,286 | ||||||||||||||||||||||||||
Stock-based compensation | 5,356 | 5,356 | ||||||||||||||||||||||||||
Issuance of nonvested stock awards | (1,215 | ) | 1,215 | — | ||||||||||||||||||||||||
Cash dividends paid ($.686 per share) | (47,864 | ) | (47,864 | ) | ||||||||||||||||||||||||
Balance September 30, 2005 | 69,409,882 | $ | 347,049 | $ | 381,433 | $ | 822,434 | $ | (192,924 | ) | $ | 6,046 | $ | 1,364,038 | ||||||||||||||
Accumulated | ||||||||||||||||||||||||||||
Number of | Other | |||||||||||||||||||||||||||
(Dollars in thousands, | Shares | Common | Capital | Retained | Treasury | Comprehensive | ||||||||||||||||||||||
except per share data) | Issued | Stock | Surplus | Earnings | Stock | Income (Loss) | Total | |||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
Balance January 1, 2006 | 69,409,882 | $ | 347,049 | $ | 388,552 | $ | 693,021 | $ | (86,901 | ) | $ | (3,883 | ) | $ | 1,337,838 | |||||||||||||
Net income | 108,277 | 108,277 | ||||||||||||||||||||||||||
Change in unrealized gain (loss) on available for sale securities, net of tax | (13,548 | ) | (13,548 | ) | ||||||||||||||||||||||||
Total comprehensive income | 94,729 | |||||||||||||||||||||||||||
Purchase of treasury stock | (75,773 | ) | (75,773 | ) | ||||||||||||||||||||||||
Issuance of stock under purchase and equity compensation plans | (4,943 | ) | 9,408 | 4,465 | ||||||||||||||||||||||||
Net tax benefit related to equity compensation plans | 747 | 747 | ||||||||||||||||||||||||||
Stock-based compensation | 2,079 | 2,079 | ||||||||||||||||||||||||||
Issuance of restricted stock awards | (1,077 | ) | 1,077 | — | ||||||||||||||||||||||||
Cash dividends paid ($.490 per share) | (32,690 | ) | (32,690 | ) | ||||||||||||||||||||||||
Balance June 30, 2006 | 69,409,882 | $ | 347,049 | $ | 385,358 | $ | 768,608 | $ | (152,189 | ) | $ | (17,431 | ) | $ | 1,331,395 | |||||||||||||
Balance January 1, 2005 | 69,409,882 | $ | 347,049 | $ | 388,614 | $ | 703,293 | $ | (51,646 | ) | $ | 39,570 | $ | 1,426,880 | ||||||||||||||
Net income | 104,214 | 104,214 | ||||||||||||||||||||||||||
Change in unrealized gain (loss) on available for sale securities, net of tax | (14,271 | ) | (14,271 | ) | ||||||||||||||||||||||||
Total comprehensive income | 89,943 | |||||||||||||||||||||||||||
Purchase of treasury stock | (121,573 | ) | (121,573 | ) | ||||||||||||||||||||||||
Issuance of stock under purchase and equity compensation plans | (8,557 | ) | 16,477 | 7,920 | ||||||||||||||||||||||||
Net tax benefit related to equity compensation plans | 1,024 | 1,024 | ||||||||||||||||||||||||||
Stock-based compensation | 4,078 | 4,078 | ||||||||||||||||||||||||||
Issuance of restricted stock awards | (993 | ) | 993 | — | ||||||||||||||||||||||||
Cash dividends paid ($.457 per share) | (32,103 | ) | (32,103 | ) | ||||||||||||||||||||||||
Balance June 30, 2005 | 69,409,882 | $ | 347,049 | $ | 384,166 | $ | 775,404 | $ | (155,749 | ) | $ | 25,299 | $ | 1,376,169 | ||||||||||||||
5
5
For the Nine Months | ||||||||
Ended September 30 | ||||||||
(In thousands) | 2006 | 2005 | ||||||
(Unaudited) | ||||||||
OPERATING ACTIVITIES: | ||||||||
Net income | $ | 162,825 | $ | 167,005 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Provision for loan losses | 17,679 | 16,805 | ||||||
Provision for depreciation and amortization | 35,404 | 30,523 | ||||||
Amortization of investment security premiums, net | 9,254 | 13,091 | ||||||
Investment securities gains, net(A) | (9,011 | ) | (5,273 | ) | ||||
Net gains on sales of loans held for sale | (6,044 | ) | (1,022 | ) | ||||
Originations of loans held for sale | (291,181 | ) | (69,318 | ) | ||||
Proceeds from sales of loans held for sale | 333,829 | 67,604 | ||||||
Net decrease in trading securities | 19,708 | 1,600 | ||||||
Stock based compensation | 3,363 | 5,356 | ||||||
(Increase) decrease in interest receivable | (7,722 | ) | 4,213 | |||||
Increase in interest payable | 22,954 | 7,839 | ||||||
Increase in income taxes payable | 11,046 | 3,843 | ||||||
Net tax benefit related to equity compensation plans | (1,178 | ) | (3,286 | ) | ||||
Other changes, net | (4,879 | ) | 7,695 | |||||
Net cash provided by operating activities | 296,047 | 246,675 | ||||||
INVESTING ACTIVITIES: | ||||||||
Net cash paid in acquisitions | (8,498 | ) | — | |||||
Proceeds from sales of investment securities(A) | 164,193 | 1,640,978 | ||||||
Proceeds from maturities/pay downs of investment securities(A) | 811,219 | 991,912 | ||||||
Purchases of investment securities(A) | (722,878 | ) | (1,971,575 | ) | ||||
Net increase in loans | (607,060 | ) | (454,637 | ) | ||||
Purchases of land, buildings and equipment | (34,950 | ) | (56,507 | ) | ||||
Sales of land, buildings and equipment | 2,324 | 1,482 | ||||||
Net cash provided by (used in) investing activities | (395,650 | ) | 151,653 | |||||
FINANCING ACTIVITIES: | ||||||||
Net decrease in non-interest bearing demand, savings, interest checking and money market deposits | (194,581 | ) | (283,882 | ) | ||||
Net increase in time open and C.D.’s | 442,203 | 193,433 | ||||||
Net increase (decrease) in federal funds purchased and securities sold under agreements to repurchase | 415,058 | (145,157 | ) | |||||
Repayment of long-term borrowings | (139,921 | ) | (18,692 | ) | ||||
Net increase in other short-term borrowings | — | 5 | ||||||
Purchases of treasury stock | (79,885 | ) | (173,004 | ) | ||||
Issuance of stock under stock purchase and equity compensation plans | 5,936 | 15,903 | ||||||
Net tax benefit related to equity compensation plans | 1,178 | 3,286 | ||||||
Cash dividends paid on common stock | (49,295 | ) | (47,864 | ) | ||||
Net cash provided by (used in) financing activities | 400,693 | (455,972 | ) | |||||
Increase (decrease) in cash and cash equivalents | 301,090 | (57,644 | ) | |||||
Cash and cash equivalents at beginning of year | 674,135 | 654,720 | ||||||
Cash and cash equivalents at September 30 | $ | 975,225 | $ | 597,076 | ||||
(A) Available for sale and non-marketable securities | ||||||||
Income tax payments, net of refunds | $ | 70,766 | $ | 70,882 | ||||
Interest paid on deposits and borrowings | $ | 202,226 | $ | 129,688 | ||||
For the Six Months | |||||||||
Ended June 30 | |||||||||
(In thousands) | 2006 | 2005 | |||||||
(Unaudited) | |||||||||
OPERATING ACTIVITIES: | |||||||||
Net income | $ | 108,277 | $ | 104,214 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Provision for loan losses | 10,104 | 7,871 | |||||||
Provision for depreciation and amortization | 23,219 | 20,362 | |||||||
Amortization of investment security premiums, net | 6,209 | 8,941 | |||||||
Investment securities gains, net(A) | (5,687 | ) | (4,984 | ) | |||||
Net gains on sales of loans held for sale | (4,889 | ) | (613 | ) | |||||
Originations of loans held for sale | (166,857 | ) | (40,560 | ) | |||||
Proceeds from sales of loans held for sale | 242,192 | 40,354 | |||||||
Net decrease in trading securities | 2,156 | 3,527 | |||||||
Stock based compensation | 2,079 | 4,078 | |||||||
(Increase) decrease in interest receivable | (1,574 | ) | 3,408 | ||||||
Increase in interest payable | 9,897 | 5,404 | |||||||
Increase in income taxes payable | 8,691 | 14,104 | |||||||
Net tax benefit related to equity compensation plans | (747 | ) | (1,024 | ) | |||||
Other changes, net | 7,642 | 1,162 | |||||||
Net cash provided by operating activities | 240,712 | 166,244 | |||||||
INVESTING ACTIVITIES: | |||||||||
Proceeds from sales of investment securities(A) | 17,528 | 1,299,648 | |||||||
Proceeds from maturities/pay downs of investment securities(A) | 562,754 | 623,914 | |||||||
Purchases of investment securities(A) | (277,268 | ) | (1,554,499 | ) | |||||
Net increase in loans | (561,317 | ) | (203,793 | ) | |||||
Purchases of land, buildings and equipment | (16,614 | ) | (44,463 | ) | |||||
Sales of land, buildings and equipment | 1,690 | 464 | |||||||
Net cash provided by (used in) investing activities | (273,227 | ) | 121,271 | ||||||
FINANCING ACTIVITIES: | |||||||||
Net decrease in non-interest bearing demand, savings, interest checking and money market deposits | (89,138 | ) | (136,125 | ) | |||||
Net increase in time open and C.D.’s | 314,937 | 348,567 | |||||||
Net increase (decrease) in federal funds purchased and securities sold under agreements to repurchase | 260,084 | (319,143 | ) | ||||||
Repayment of long-term borrowings | (124,390 | ) | (17,676 | ) | |||||
Purchases of treasury stock | (75,773 | ) | (121,573 | ) | |||||
Issuance of stock under stock purchase and equity compensation plans | 4,465 | 7,920 | |||||||
Net tax benefit related to equity compensation plans | 747 | 1,024 | |||||||
Cash dividends paid on common stock | (32,690 | ) | (32,103 | ) | |||||
Net cash provided by (used in) financing activities | 258,242 | (269,109 | ) | ||||||
Increase in cash and cash equivalents | 225,727 | 18,406 | |||||||
Cash and cash equivalents at beginning of year | 674,135 | 654,720 | |||||||
Cash and cash equivalents at June 30 | $ | 899,862 | $ | 673,126 | |||||
(A) Available for sale and non-marketable securities | |||||||||
Income tax payments, net of refunds | $ | 44,460 | $ | 41,564 | |||||
Interest paid on deposits and borrowings | $ | 127,766 | $ | 79,385 | |||||
6
6
For the Three Months Ended September 30 | For the Nine Months Ended September 30 | |||||||||||||||
(In thousands, except per share data) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Net interest income plus non-interest income | $ | 221,862 | $ | 217,028 | $ | 660,799 | $ | 640,021 | ||||||||
Net income | 50,315 | 63,616 | 159,408 | 169,511 | ||||||||||||
Net income per share – basic | .74 | .90 | 2.35 | 2.37 | ||||||||||||
Net income per share – diluted | .73 | .89 | 2.31 | 2.34 | ||||||||||||
7
June 30 | December 31 | |||||||
(In thousands) | 2006 | 2005 | ||||||
Business | $ | 2,786,701 | $ | 2,527,654 | ||||
Real estate - construction | 525,162 | 424,561 | ||||||
Real estate - business | 2,004,221 | 1,919,045 | ||||||
Real estate - personal | 1,392,529 | 1,358,511 | ||||||
Consumer | 1,356,927 | 1,287,348 | ||||||
Home equity | 442,136 | 448,507 | ||||||
Student | 256,724 | 330,238 | ||||||
Credit card | 606,433 | 592,465 | ||||||
Overdrafts | 9,060 | 10,854 | ||||||
Total loans | $ | 9,379,893 | $ | 8,899,183 | ||||
7
September 30 | December 31 | |||||||
(In thousands) | 2006 | 2005 | ||||||
Business | $ | 2,746,310 | $ | 2,527,654 | ||||
Real estate – construction | 591,733 | 424,561 | ||||||
Real estate – business | 2,195,244 | 1,919,045 | ||||||
Real estate – personal | 1,524,912 | 1,358,511 | ||||||
Consumer | 1,397,063 | 1,287,348 | ||||||
Home equity | 446,966 | 448,507 | ||||||
Student | 287,894 | 330,238 | ||||||
Credit card | 614,433 | 592,465 | ||||||
Overdrafts | 28,635 | 10,854 | ||||||
Total loans | $ | 9,833,190 | $ | 8,899,183 | ||||
For the Three Months | For the Six Months | ||||||||||||||||
Ended June 30 | Ended June 30 | ||||||||||||||||
(In thousands) | 2006 | 2005 | 2006 | 2005 | |||||||||||||
Balance, beginning of period | $ | 128,468 | $ | 130,960 | $ | 128,447 | $ | 132,394 | |||||||||
Additions: | |||||||||||||||||
Provision for loan losses | 5,672 | 5,503 | 10,104 | 7,871 | |||||||||||||
Total additions | 5,672 | 5,503 | 10,104 | 7,871 | |||||||||||||
Deductions: | |||||||||||||||||
Loan losses | 9,223 | 9,754 | 18,569 | 19,254 | |||||||||||||
Less recoveries on loans | 3,529 | 2,719 | 8,464 | 8,417 | |||||||||||||
Net loan losses | 5,694 | 7,035 | 10,105 | 10,837 | |||||||||||||
Balance, June 30 | $ | 128,446 | $ | 129,428 | $ | 128,446 | $ | 129,428 | |||||||||
For the Three Months Ended September 30 | For the Nine Months Ended September 30 | |||||||||||||||
(In thousands) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Balance, beginning of period | $ | 128,446 | $ | 129,428 | $ | 128,447 | $ | 132,394 | ||||||||
Additions: | ||||||||||||||||
Allowance for loan losses of acquired banks | 3,688 | — | 3,688 | — | ||||||||||||
Provision for loan losses | 7,575 | 8,934 | 17,679 | 16,805 | ||||||||||||
Total additions | 11,263 | 8,934 | 21,367 | 16,805 | ||||||||||||
Deductions: | ||||||||||||||||
Loan losses | 10,698 | 11,690 | 29,267 | 30,944 | ||||||||||||
Less recoveries on loans | 2,823 | 2,634 | 11,287 | 11,051 | ||||||||||||
Net loan losses | 7,875 | 9,056 | 17,980 | 19,893 | ||||||||||||
Balance, September 30 | $ | 131,834 | $ | 129,306 | $ | 131,834 | $ | 129,306 | ||||||||
8
June 30 | December 31 | ||||||||
(In thousands) | 2006 | 2005 | |||||||
Available for sale: | |||||||||
U.S. government and federal agency obligations | $ | 62,334 | $ | 61,803 | |||||
Government-sponsored enterprise obligations | 556,587 | 772,854 | |||||||
State and municipal obligations | 425,127 | 249,018 | |||||||
Mortgage-backed securities | 1,461,115 | 1,631,675 | |||||||
Other asset-backed securities | 569,389 | 684,724 | |||||||
Other debt securities | 39,431 | 40,017 | |||||||
Equity securities | 223,494 | 227,810 | |||||||
Trading | 17,001 | 24,959 | |||||||
Non-marketable | 81,401 | 77,321 | |||||||
Total investment securities | $ | 3,435,879 | $ | 3,770,181 | |||||
September 30 | December 31 | |||||||
(In thousands) | 2006 | 2005 | ||||||
Available for sale | ||||||||
U.S. government and federal agency obligations | $ | 13,284 | $ | 61,803 | ||||
Government-sponsored enterprise obligations | 500,672 | 772,854 | ||||||
State and municipal obligations | 570,255 | 249,018 | ||||||
Mortgage-backed securities | 1,775,996 | 1,631,675 | ||||||
Other asset-backed securities | 400,018 | 684,724 | ||||||
Other debt securities | 36,047 | 40,017 | ||||||
Equity securities | 236,801 | 227,810 | ||||||
Trading | 7,770 | 24,959 | ||||||
Non-marketable | 87,301 | 77,321 | ||||||
Total investment securities | $ | 3,628,144 | $ | 3,770,181 | ||||
8
June 30, 2006 | December 31, 2005 | ||||||||||||||||
Gross | Gross | ||||||||||||||||
Carrying | Accumulated | Carrying | Accumulated | ||||||||||||||
(In thousands) | Amount | Amortization | Amount | Amortization | |||||||||||||
Amortized intangible assets: | |||||||||||||||||
Mortgage servicing rights | $ | 513 | $ | (471 | ) | $ | 522 | $ | (475 | ) | |||||||
September 30, 2006 | December 31, 2005 | |||||||||||||||||||||||
Gross | Gross | |||||||||||||||||||||||
Carrying | Accumulated | Net | Carrying | Accumulated | Net | |||||||||||||||||||
(In thousands) | Amount | Amortization | Amount | Amount | Amortization | Amount | ||||||||||||||||||
Amortized intangible assets: | ||||||||||||||||||||||||
Core deposit premium | $ | 12,824 | $ | (128 | ) | $ | 12,696 | $ | — | $ | — | $ | — | |||||||||||
Mortgage servicing rights | 1,107 | (478 | ) | 629 | 522 | (475 | ) | 47 | ||||||||||||||||
Total | $ | 13,931 | $ | (606 | ) | $ | 13,325 | $ | 522 | $ | (475 | ) | $ | 47 | ||||||||||
9
(In thousands) | ||||
2006 | $ | 540 | ||
2007 | 1,414 | |||
2008 | 1,402 | |||
2009 | 1,390 | |||
2010 | 1,390 | |||
(In thousands) | ||||
Balance at December 31, 2004 | $ | 48,522 | ||
Balance at December 31, 2005 | $ | 48,522 | ||
Current year acquisitions | 55,932 | |||
Adjustments to prior year acquisitions | (3,521 | ) | ||
Balance at September 30, 2006 | $ | 100,933 | ||
10
9
For the | For the | |||||||||||||||
Three Months | Six Months | |||||||||||||||
Ended June 30 | Ended June 30 | |||||||||||||||
(In thousands) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Service cost – benefits earned during the period | $ | 276 | $ | 365 | $ | 552 | $ | 730 | ||||||||
Interest cost on projected benefit obligation | 1,191 | 1,170 | 2,382 | 2,340 | ||||||||||||
Expected return on plan assets | (1,800 | ) | (1,705 | ) | (3,600 | ) | (3,410 | ) | ||||||||
Amortization of unrecognized net loss | 257 | 280 | 515 | 560 | ||||||||||||
Net periodic pension cost (income) | $ | (76 | ) | $ | 110 | $ | (151 | ) | $ | 220 | ||||||
For the | For the | |||||||||||||||
Three Months | Nine Months | |||||||||||||||
Ended September 30 | Ended September 30 | |||||||||||||||
(In thousands) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Service cost – benefits earned during the period | $ | 211 | $ | (102 | ) | $ | 763 | $ | 628 | |||||||
Interest cost on projected benefit obligation | 1,157 | 1,176 | 3,539 | 3,516 | ||||||||||||
Expected return on plan assets | (1,800 | ) | (1,702 | ) | (5,400 | ) | (5,112 | ) | ||||||||
Amortization of unrecognized net loss | 285 | 311 | 800 | 871 | ||||||||||||
Net periodic pension cost (income) | $ | (147 | ) | $ | (317 | ) | $ | (298 | ) | $ | (97 | ) | ||||
For the | For the | |||||||||||||||||
Three Months | Six Months | |||||||||||||||||
Ended June 30 | Ended June 30 | |||||||||||||||||
(In thousands, except per share data) | 2006 | 2005 | 2006 | 2005 | ||||||||||||||
Basic earnings per share: | ||||||||||||||||||
Net income available to common shareholders | $ | 55,333 | $ | 54,368 | $ | 108,277 | $ | 104,214 | ||||||||||
Weighted average basic common shares outstanding | 66,551 | 70,071 | 66,769 | 70,544 | ||||||||||||||
Basic earnings per share | $ | .83 | $ | .78 | $ | 1.62 | $ | 1.48 | ||||||||||
Diluted earnings per share: | ||||||||||||||||||
Net income available to common shareholders | $ | 55,333 | $ | 54,368 | $ | 108,277 | $ | 104,214 | ||||||||||
Weighted average common shares outstanding | 66,551 | 70,071 | 66,769 | 70,544 | ||||||||||||||
Net effect of nonvested restricted stock and the assumed exercise of stock options – based on the treasury stock method using the average market price for the respective periods | 909 | 965 | 923 | 977 | ||||||||||||||
Weighted average diluted common shares outstanding | 67,460 | 71,036 | 67,692 | 71,521 | ||||||||||||||
Diluted earnings per share | $ | .82 | $ | .77 | $ | 1.60 | $ | 1.46 | ||||||||||
For the | For the | |||||||||||||||
Three Months | Nine Months | |||||||||||||||
Ended September 30 | Ended September 30 | |||||||||||||||
(In thousands, except per share data) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Basic earnings per share: | ||||||||||||||||
Net income available to common shareholders | $ | 54,548 | $ | 62,791 | $ | 162,825 | $ | 167,005 | ||||||||
Weighted average basic common shares outstanding | 66,701 | 69,244 | 66,746 | 70,106 | ||||||||||||
Basic earnings per share | $ | .82 | $ | .90 | $ | 2.44 | $ | 2.38 | ||||||||
Diluted earnings per share: | ||||||||||||||||
Net income available to common shareholders | $ | 54,548 | $ | 62,791 | $ | 162,825 | $ | 167,005 | ||||||||
Weighted average common shares outstanding | 66,701 | 69,244 | 66,746 | 70,106 | ||||||||||||
Net effect of nonvested stock and the assumed exercise of stock options – based on the treasury stock method using the average market price for the respective periods | 880 | 950 | 909 | 968 | ||||||||||||
Weighted average diluted common shares outstanding | 67,581 | 70,194 | 67,655 | 71,074 | ||||||||||||
Diluted earnings per share | $ | .81 | $ | .89 | $ | 2.41 | $ | 2.35 | ||||||||
11
10
For the | For the | |||||||||||||||
Three Months | Six Months | |||||||||||||||
Ended June 30 | Ended June 30 | |||||||||||||||
(In thousands) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Unrealized holding gains (losses) | $ | (5,109 | ) | $ | 33,110 | $ | (21,851 | ) | $ | (19,145 | ) | |||||
Reclassification adjustment for gains included in net income | — | (1,044 | ) | — | (3,873 | ) | ||||||||||
Net unrealized gains (losses) on securities | (5,109 | ) | 32,066 | (21,851 | ) | (23,018 | ) | |||||||||
Income tax expense (benefit) | (1,941 | ) | 12,185 | (8,303 | ) | (8,747 | ) | |||||||||
Other comprehensive income (loss) | $ | (3,168 | ) | $ | 19,881 | $ | (13,548 | ) | $ | (14,271 | ) | |||||
For the | For the | |||||||||||||||
Three Months | Nine Months | |||||||||||||||
Ended September 30 | Ended September 30 | |||||||||||||||
(In thousands) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Unrealized holding gains (losses) | $ | 36,448 | $ | (29,964 | ) | $ | 14,597 | $ | (49,109 | ) | ||||||
Reclassification adjustment for (gains) losses included in net income | 2,085 | (1,089 | ) | 2,085 | (4,962 | ) | ||||||||||
Net unrealized gains (losses) on securities | 38,533 | (31,053 | ) | 16,682 | (54,071 | ) | ||||||||||
Income tax expense (benefit) | 14,642 | (11,800 | ) | 6,339 | (20,547 | ) | ||||||||||
Other comprehensive income (loss) | $ | 23,891 | $ | (19,253 | ) | $ | 10,343 | $ | (33,524 | ) | ||||||
Money | Segment | Other/ | Consolidated | |||||||||||||||||||||
(In thousands) | Consumer | Commercial | Management | Totals | Elimination | Totals | ||||||||||||||||||
Three Months Ended June 30, 2006: | ||||||||||||||||||||||||
Net interest income | $ | 94,041 | $ | 51,618 | $ | 2,410 | $ | 148,069 | $ | (21,590 | ) | $ | 126,479 | |||||||||||
Provision for loan losses | 5,320 | 393 | — | 5,713 | (41 | ) | 5,672 | |||||||||||||||||
Non-interest income | 45,738 | 19,444 | 21,169 | 86,351 | 5,112 | 91,463 | ||||||||||||||||||
Non-interest expense | 71,908 | 36,421 | 14,938 | 123,267 | 6,283 | 129,550 | ||||||||||||||||||
Income before income taxes | $ | 62,551 | $ | 34,248 | $ | 8,641 | $ | 105,440 | $ | (22,720 | ) | $ | 82,720 | |||||||||||
Three Months Ended June 30, 2005: | ||||||||||||||||||||||||
Net interest income | $ | 82,216 | $ | 47,707 | $ | 2,230 | $ | 132,153 | $ | (4,766 | ) | $ | 127,387 | |||||||||||
Provision for loan losses | 7,113 | (72 | ) | — | 7,041 | (1,538 | ) | 5,503 | ||||||||||||||||
Non-interest income | 44,435 | 17,792 | 20,568 | 82,795 | 2,185 | 84,980 | ||||||||||||||||||
Non-interest expense | 69,927 | 34,611 | 14,710 | 119,248 | 3,764 | 123,012 | ||||||||||||||||||
Income before income taxes | $ | 49,611 | $ | 30,960 | $ | 8,088 | $ | 88,659 | $ | (4,807 | ) | $ | 83,852 | |||||||||||
Money | Segment | Other/ | Consolidated | |||||||||||||||||||||
(In thousands) | Consumer | Commercial | Management | Totals | Elimination | Totals | ||||||||||||||||||
Three Months Ended September 30, 2006: | ||||||||||||||||||||||||
Net interest income | $ | 95,749 | $ | 54,390 | $ | 2,381 | $ | 152,520 | $ | (23,767 | ) | $ | 128,753 | |||||||||||
Provision for loan losses | 7,460 | 512 | — | 7,972 | (397 | ) | 7,575 | |||||||||||||||||
Non-interest income | 48,212 | 19,887 | 20,609 | 88,708 | 1,948 | 90,656 | ||||||||||||||||||
Non-interest expense | 72,581 | 35,726 | 14,986 | 123,293 | 9,011 | 132,304 | ||||||||||||||||||
Income before income taxes | $ | 63,920 | $ | 38,039 | $ | 8,004 | $ | 109,963 | $ | (30,433 | ) | $ | 79,530 | |||||||||||
Three Months Ended September 30, 2005: | ||||||||||||||||||||||||
Net interest income | $ | 85,479 | $ | 49,887 | $ | 1,928 | $ | 137,294 | $ | (11,462 | ) | $ | 125,832 | |||||||||||
Provision for loan losses | 8,377 | 682 | — | 9,059 | (125 | ) | 8,934 | |||||||||||||||||
Non-interest income | 45,604 | 18,593 | 20,836 | 85,033 | 1,862 | 86,895 | ||||||||||||||||||
Non-interest expense | 68,837 | 33,520 | 14,222 | 116,579 | 5,808 | 122,387 | ||||||||||||||||||
Income before income taxes | $ | 53,869 | $ | 34,278 | $ | 8,542 | $ | 96,689 | $ | (15,283 | ) | $ | 81,406 | |||||||||||
12
11
Money | Segment | Other/ | Consolidated | |||||||||||||||||||||
(In thousands) | Consumer | Commercial | Management | Totals | Elimination | Totals | ||||||||||||||||||
Six Months Ended June 30, 2006: | ||||||||||||||||||||||||
Net interest income | $ | 183,090 | $ | 101,291 | $ | 5,034 | $ | 289,415 | $ | (39,201 | ) | $ | 250,214 | |||||||||||
Provision for loan losses | 10,967 | (854 | ) | — | 10,113 | (9 | ) | 10,104 | ||||||||||||||||
Non-interest income | 89,219 | 38,613 | 42,855 | 170,687 | 10,224 | 180,911 | ||||||||||||||||||
Non-interest expense | 143,012 | 71,930 | 30,650 | 245,592 | 13,919 | 259,511 | ||||||||||||||||||
Income before income taxes | $ | 118,330 | $ | 68,828 | $ | 17,239 | $ | 204,397 | $ | (42,887 | ) | $ | 161,510 | |||||||||||
Six Months Ended June 30, 2005: | ||||||||||||||||||||||||
Net interest income | $ | 159,404 | $ | 94,012 | $ | 4,168 | $ | 257,584 | $ | (8,720 | ) | $ | 248,864 | |||||||||||
Provision for loan losses | 13,740 | (2,905 | ) | — | 10,835 | (2,964 | ) | 7,871 | ||||||||||||||||
Non-interest income | 82,228 | 35,786 | 40,697 | 158,711 | 6,960 | 165,671 | ||||||||||||||||||
Non-interest expense | 139,107 | 69,392 | 29,525 | 238,024 | 8,910 | 246,934 | ||||||||||||||||||
Income before income taxes | $ | 88,785 | $ | 63,311 | $ | 15,340 | $ | 167,436 | $ | (7,706 | ) | $ | 159,730 | |||||||||||
Money | Segment | Other/ | Consolidated | |||||||||||||||||||||
(In thousands) | Consumer | Commercial | Management | Totals | Elimination | Totals | ||||||||||||||||||
Nine Months Ended September 30, 2006: | ||||||||||||||||||||||||
Net interest income | $ | 277,413 | $ | 155,734 | $ | 7,415 | $ | 440,562 | $ | (61,595 | ) | $ | 378,967 | |||||||||||
Provision for loan losses | 18,427 | (342 | ) | — | 18,085 | (406 | ) | 17,679 | ||||||||||||||||
Non-interest income | 137,432 | 58,500 | 63,464 | 259,396 | 12,171 | 271,567 | ||||||||||||||||||
Non-interest expense | 215,646 | 107,607 | 45,636 | 368,889 | 22,926 | 391,815 | ||||||||||||||||||
Income before income taxes | $ | 180,772 | $ | 106,969 | $ | 25,243 | $ | 312,984 | $ | (71,944 | ) | $ | 241,040 | |||||||||||
Nine Months Ended September 30, 2005: | ||||||||||||||||||||||||
Net interest income | $ | 245,144 | $ | 143,834 | $ | 6,096 | $ | 395,074 | $ | (20,378 | ) | $ | 374,696 | |||||||||||
Provision for loan losses | 22,118 | (2,223 | ) | — | 19,895 | (3,090 | ) | 16,805 | ||||||||||||||||
Non-interest income | 127,833 | 54,379 | 61,533 | 243,745 | 8,821 | 252,566 | ||||||||||||||||||
Non-interest expense | 207,948 | 102,908 | 43,747 | 354,603 | 14,718 | 369,321 | ||||||||||||||||||
Income before income taxes | $ | 142,911 | $ | 97,528 | $ | 23,882 | $ | 264,321 | $ | (23,185 | ) | $ | 241,136 | |||||||||||
13
12
June 30, 2006 | December 31, 2005 | ||||||||||||||||||||||||
Positive | Negative | Positive | Negative | ||||||||||||||||||||||
Notional | Fair | Fair | Notional | Fair | Fair | ||||||||||||||||||||
(In thousands) | Amount | Value | Value | Amount | Value | Value | |||||||||||||||||||
Interest rate contracts: | |||||||||||||||||||||||||
Swap contracts | $ | 185,707 | $ | 2,937 | $ | (3,390 | ) | $ | 162,698 | $ | 798 | $ | (1,782 | ) | |||||||||||
Option contracts | 6,970 | 28 | (28 | ) | 6,970 | 6 | (6 | ) | |||||||||||||||||
Foreign exchange contracts: | |||||||||||||||||||||||||
Forward contracts | 1,690 | 3 | (15 | ) | 14,184 | 159 | (77 | ) | |||||||||||||||||
Option contracts | 2,760 | 4 | (4 | ) | 2,560 | 3 | (3 | ) | |||||||||||||||||
Mortgage loan commitments | 6,945 | — | (34 | ) | 5,353 | 12 | — | ||||||||||||||||||
Mortgage loan forward sale contracts | 13,246 | 89 | — | 9,251 | 7 | (18 | ) | ||||||||||||||||||
Total | $ | 217,318 | $ | 3,061 | $ | (3,471 | ) | $ | 201,016 | $ | 985 | $ | (1,886 | ) | |||||||||||
September 30, 2006 | December 31, 2005 | |||||||||||||||||||||||
Positive | Negative | Positive | Negative | |||||||||||||||||||||
Notional | Fair | Fair | Notional | Fair | Fair | |||||||||||||||||||
(In thousands) | Amount | Value | Value | Amount | Value | Value | ||||||||||||||||||
Interest rate contracts: | ||||||||||||||||||||||||
Swap contracts | $ | 183,550 | $ | 1,201 | $ | (2,083 | ) | $ | 162,698 | $ | 798 | $ | (1,782 | ) | ||||||||||
Option contracts | 6,970 | 11 | (11 | ) | 6,970 | 6 | (6 | ) | ||||||||||||||||
Foreign exchange contracts: | ||||||||||||||||||||||||
Forward contracts | 756 | 3 | (1 | ) | 14,184 | 159 | (77 | ) | ||||||||||||||||
Option contracts | 2,760 | 12 | (12 | ) | 2,560 | 3 | (3 | ) | ||||||||||||||||
Mortgage loan commitments | 8,109 | 14 | (4 | ) | 5,353 | 12 | — | |||||||||||||||||
Mortgage loan forward sale contracts | 17,082 | 4 | (90 | ) | 9,251 | 7 | (18 | ) | ||||||||||||||||
Total | $ | 219,227 | $ | 1,245 | $ | (2,201 | ) | $ | 201,016 | $ | 985 | $ | (1,886 | ) | ||||||||||
14
13
Six Months Ended | |||||||||
June 30 | |||||||||
2006 | 2005 | ||||||||
Weighted per share average fair value at grant date | $14.08 | $11.89 | |||||||
Assumptions: | |||||||||
Dividend yield | 1.7 | % | 2.0 | % | |||||
Volatility | 21.07 | % | 23.4 | % | |||||
Risk-free interest rate | 4.6 | % | 4.2 | % | |||||
Expected term | 7.4 years | 7.1 years | |||||||
Nine Months Ended | ||||||||
September 30 | ||||||||
2006 | 2005 | |||||||
Weighted per share average fair value at grant date | $14.08 | $11.88 | ||||||
Assumptions: | ||||||||
Dividend yield | 1.7 | % | 2.0 | % | ||||
Volatility | 21.1 | % | 23.4 | % | ||||
Risk-free interest rate | 4.6 | % | 4.2 | % | ||||
Expected term | 7.4 years | 7.1 years | ||||||
Weighted | ||||||||||||||||
Weighted | Average | |||||||||||||||
Average | Remaining | Aggregate | ||||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||||
(Dollars in thousands, except per share data) | Shares | Price | Term | Value | ||||||||||||
Outstanding at January 1, 2006 | 3,412,808 | $ | 33.86 | |||||||||||||
Granted | — | — | ||||||||||||||
Cancelled | (5,776 | ) | 43.49 | |||||||||||||
Exercised | (186,887 | ) | 24.13 | |||||||||||||
Outstanding at June 30, 2006 | 3,220,145 | $ | 34.40 | 5.5 years | $ | 50,389 | ||||||||||
Exercisable at June 30, 2006 | 2,872,409 | $ | 33.10 | 5.2 years | $ | 48,686 | ||||||||||
Vested and expected to vest at June 30, 2006 | 3,210,010 | $ | 34.37 | 5.5 years | $ | 50,339 | ||||||||||
Weighted | ||||||||||||||||
Weighted | Average | |||||||||||||||
Average | Remaining | Aggregate | ||||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||||
(Dollars in thousands, except per share data) | Shares | Price | Term | Value | ||||||||||||
Outstanding at January 1, 2006 | 3,412,808 | $ | 33.86 | |||||||||||||
Granted | — | — | ||||||||||||||
Forfeited | (6,299 | ) | 43.64 | |||||||||||||
Exercised | (242,931 | ) | 24.61 | |||||||||||||
Outstanding at September 30, 2006 | 3,163,578 | $ | 34.55 | 5.3 years | $ | 50,695 | ||||||||||
Exercisable at September 30, 2006 | 2,817,062 | $ | 33.24 | 5.0 years | $ | 48,820 | ||||||||||
Vested and expected to vest at September 30, 2006 | 3,156,034 | $ | 34.52 | 5.3 years | $ | 50,654 | ||||||||||
Weighted | ||||||||||||||||
Weighted | Average | |||||||||||||||
Average | Remaining | Aggregate | ||||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||||
(Dollars in thousands, except per share data) | Shares | Price | Term | Value | ||||||||||||
Outstanding at January 1, 2006 | — | $ | — | |||||||||||||
Granted | 459,450 | 51.75 | ||||||||||||||
Cancelled | (2,850 | ) | 51.55 | |||||||||||||
Exercised | — | — | ||||||||||||||
Outstanding at June 30, 2006 | 456,600 | $ | 51.75 | 9.7 years | $ | — | ||||||||||
Exercisable at June 30, 2006 | — | $ | — | — | $ | — | ||||||||||
Vested and expected to vest at June 30, 2006 | 388,179 | $ | 51.75 | 9.7 years | $ | — | ||||||||||
Weighted | ||||||||||||||||
Weighted | Average | |||||||||||||||
Average | Remaining | Aggregate | ||||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||||
(Dollars in thousands, except per share data) | Shares | Price | Term | Value | ||||||||||||
Outstanding at January 1, 2006 | — | $ | — | |||||||||||||
Granted | 459,450 | 51.75 | ||||||||||||||
Forfeited | (3,250 | ) | 51.55 | |||||||||||||
Exercised | — | — | ||||||||||||||
Outstanding at September 30, 2006 | 456,200 | $ | 51.75 | 9.4 years | $ | — | ||||||||||
Exercisable at September 30, 2006 | — | $ | — | — | $ | — | ||||||||||
Vested and expected to vest at September 30, 2006 | 395,652 | $ | 51.75 | 9.4 years | $ | — | ||||||||||
15
14
Three Months | Six Months | |||||||||||||||
Ended June 30 | Ended June 30 | |||||||||||||||
(Dollars in thousands) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Intrinsic value of options exercised | $ | 432 | $ | 3,933 | $ | 5,051 | $ | 8,739 | ||||||||
Cash received from options exercised | $ | 563 | $ | 4,870 | $ | 4,458 | $ | 7,919 | ||||||||
Tax benefit realized from options exercised | $ | 108 | $ | 889 | $ | 747 | $ | 1,024 | ||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||
(In thousands) | 2006 | 2005 | 2006 | 2005 | ||||||||||||
Intrinsic value of options exercised | $ | 1,350 | $ | 7,368 | $ | 6,401 | $ | 16,107 | ||||||||
Cash received from options exercised | $ | 1,469 | $ | 7,980 | $ | 5,927 | $ | 15,899 | ||||||||
Tax benefit realized from options exercised | $ | 431 | $ | 2,262 | $ | 1,178 | $ | 3,286 | ||||||||
Weighted | ||||||||
Average | ||||||||
Grant Date | ||||||||
Shares | Fair Value | |||||||
Nonvested at January 1, 2006 | 163,420 | $ | 39.37 | |||||
Granted | 22,722 | 51.61 | ||||||
Vested | (28,503 | ) | 30.61 | |||||
Forfeited | (1,658 | ) | 43.35 | |||||
Nonvested at June 30, 2006 | 155,981 | $ | 42.71 | |||||
Weighted Average | ||||||||
Grant Date | ||||||||
Shares | Fair Value | |||||||
Nonvested at January 1, 2006 | 163,420 | $ | 39.37 | |||||
Granted | 24,622 | 51.50 | ||||||
Vested | (28,503 | ) | 30.61 | |||||
Forfeited | (1,658 | ) | 43.35 | |||||
Nonvested at September 30, 2006 | 157,881 | $ | 42.80 | |||||
Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF CONSOLIDATED FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
16
15
17
16
Three Months | Six Months | ||||||||||||||||
Ended June 30 | Ended June 30 | ||||||||||||||||
2006 | 2005 | 2006 | 2005 | ||||||||||||||
Per Share Data | |||||||||||||||||
Net income – basic | $ | .83 | $ | .78 | $ | 1.62 | $ | 1.48 | |||||||||
Net income – diluted | .82 | .77 | 1.60 | 1.46 | |||||||||||||
Cash dividends | .245 | .229 | .490 | .457 | |||||||||||||
Book value | 20.08 | 19.83 | |||||||||||||||
Market price | 50.05 | 48.01 | |||||||||||||||
Selected Ratios | |||||||||||||||||
(Based on average balance sheets) | |||||||||||||||||
Loans to deposits | 84.27 | % | 79.35 | % | 83.80 | % | 79.40 | % | |||||||||
Non-interest bearing deposits to total deposits | 6.06 | 5.93 | 5.80 | 6.63 | |||||||||||||
Equity to loans | 14.48 | 16.29 | 14.62 | 16.56 | |||||||||||||
Equity to deposits | 12.21 | 12.92 | 12.26 | 13.15 | |||||||||||||
Equity to total assets | 9.69 | 9.85 | 9.70 | 9.93 | |||||||||||||
Return on total assets | 1.61 | 1.55 | 1.59 | 1.50 | |||||||||||||
Return on total stockholders’ equity | 16.59 | 15.78 | 16.37 | 15.07 | |||||||||||||
(Based on end-of-period data) | |||||||||||||||||
Efficiency ratio* | 60.35 | 58.27 | 61.00 | 60.18 | |||||||||||||
Tier I capital ratio | 11.51 | 11.77 | |||||||||||||||
Total capital ratio | �� | 12.85 | 13.12 | ||||||||||||||
Leverage ratio | 9.47 | 9.37 | |||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30 | September 30 | |||||||||||||||
2006 | 2005 | 2006 | 2005 | |||||||||||||
Per Share Data | ||||||||||||||||
Net income – basic | $ | .82 | $ | .90 | $ | 2.44 | $ | 2.38 | ||||||||
Net income – diluted | .81 | .89 | 2.41 | 2.35 | ||||||||||||
Cash dividends | .245 | .229 | .735 | .686 | ||||||||||||
Book value | 21.58 | 19.85 | ||||||||||||||
Market price | 50.57 | 49.03 | ||||||||||||||
Selected Ratios | ||||||||||||||||
(Based on average balance sheets) | ||||||||||||||||
Loans to deposits | 85.36 | % | 82.67 | % | 84.34 | % | 80.49 | % | ||||||||
Non-interest bearing deposits to total deposits | 5.76 | 5.78 | 5.78 | 6.34 | ||||||||||||
Equity to loans | 14.48 | 15.96 | 14.58 | 16.36 | ||||||||||||
Equity to deposits | 12.36 | 13.19 | 12.29 | 13.17 | ||||||||||||
Equity to total assets | 9.59 | 9.83 | 9.66 | 9.90 | ||||||||||||
Return on total assets | 1.50 | 1.78 | 1.56 | 1.59 | ||||||||||||
Return on total stockholders’ equity | 15.64 | 18.12 | 16.12 | 16.09 | ||||||||||||
(Based onend-of-period data) | ||||||||||||||||
Efficiency ratio* | 61.16 | 57.61 | 61.05 | 59.30 | ||||||||||||
Tier I capital ratio | 11.42 | 11.65 | ||||||||||||||
Total capital ratio | 12.73 | 12.99 | ||||||||||||||
Leverage ratio | 9.47 | 9.44 | ||||||||||||||
* | The efficiency ratio is calculated as non-interest expense (excluding intangibles amortization) as a percent of net interest income and non-interest income (excluding net securities gains/losses). |
18
Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||||||
(Dollars in thousands) | 2006 | 2005 | % Change | 2006 | 2005 | % Change | ||||||||||||||||||
Net interest income | $ | 126,479 | $ | 127,387 | (.7 | )% | $ | 250,214 | $ | 248,864 | .5 | % | ||||||||||||
Provision for loan losses | (5,672 | ) | (5,503 | ) | 3.1 | (10,104 | ) | (7,871 | ) | 28.4 | ||||||||||||||
Non-interest income | 91,463 | 84,980 | 7.6 | 180,911 | 165,671 | 9.2 | ||||||||||||||||||
Non-interest expense | (129,550 | ) | (123,012 | ) | 5.3 | (259,511 | ) | (246,934 | ) | 5.1 | ||||||||||||||
Income taxes | (27,387 | ) | (29,484 | ) | (7.1 | ) | (53,233 | ) | (55,516 | ) | (4.1 | ) | ||||||||||||
Net income | $ | 55,333 | $ | 54,368 | 1.8 | % | $ | 108,277 | $ | 104,214 | 3.9 | % | ||||||||||||
17
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||
(Dollars in thousands) | 2006 | 2005 | % Change | 2006 | 2005 | % Change | ||||||||||||||||||
Net interest income | $ | 128,753 | $ | 125,832 | 2.3 | % | $ | 378,967 | $ | 374,696 | 1.1 | % | ||||||||||||
Provision for loan losses | (7,575 | ) | (8,934 | ) | (15.2 | ) | (17,679 | ) | (16,805 | ) | 5.2 | |||||||||||||
Non-interest income | 90,656 | 86,895 | 4.3 | 271,567 | 252,566 | 7.5 | ||||||||||||||||||
Non-interest expense | (132,304 | ) | (122,387 | ) | 8.1 | (391,815 | ) | (369,321 | ) | 6.1 | ||||||||||||||
Income taxes | (24,982 | ) | (18,615 | ) | 34.2 | (78,215 | ) | (74,131 | ) | 5.5 | ||||||||||||||
Net income | $ | 54,548 | $ | 62,791 | (13.1 | )% | $ | 162,825 | $ | 167,005 | (2.5 | )% | ||||||||||||
19
18
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
June 30, 2006 vs. 2005 | June 30, 2006 vs. 2005 | |||||||||||||||||||||||||
Change due to | Change due to | |||||||||||||||||||||||||
Average | Average | Average | Average | |||||||||||||||||||||||
(In thousands) | Volume | Rate | Total | Volume | Rate | Total | ||||||||||||||||||||
Interest income, fully taxable equivalent basis: | ||||||||||||||||||||||||||
Loans | $ | 11,114 | $ | 24,957 | $ | 36,071 | $ | 20,300 | $ | 47,221 | $ | 67,521 | ||||||||||||||
Investment securities: | ||||||||||||||||||||||||||
U.S. government and federal agency securities | (4,947 | ) | (1,938 | ) | (6,885 | ) | (9,908 | ) | (1,396 | ) | (11,304 | ) | ||||||||||||||
State and municipal obligations | 3,058 | (21 | ) | 3,037 | 5,179 | (48 | ) | 5,131 | ||||||||||||||||||
Mortgage and asset-backed securities | (7,780 | ) | 1,042 | (6,738 | ) | (13,012 | ) | 3,372 | (9,640 | ) | ||||||||||||||||
Other securities | 38 | 1,126 | 1,164 | 22 | 2,406 | 2,428 | ||||||||||||||||||||
Total interest on investment securities | (9,631 | ) | 209 | (9,422 | ) | (17,719 | ) | 4,334 | (13,385 | ) | ||||||||||||||||
Federal funds sold and securities purchased under agreements to resell | (86 | ) | 723 | 637 | 346 | 1,330 | 1,676 | |||||||||||||||||||
Total interest income | 1,397 | 25,889 | 27,286 | 2,927 | 52,885 | 55,812 | ||||||||||||||||||||
Interest expense: | ||||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||||
Savings | (16 | ) | 247 | 231 | (31 | ) | 461 | 430 | ||||||||||||||||||
Interest checking and money market | (97 | ) | 10,676 | 10,579 | (432 | ) | 19,962 | 19,530 | ||||||||||||||||||
Time open & C.D.’s of less than $100,000 | 1,767 | 5,630 | 7,397 | 3,155 | 10,581 | 13,736 | ||||||||||||||||||||
Time open & C.D.’s of $100,000 and over | 1,281 | 4,652 | 5,933 | 3,299 | 9,469 | 12,768 | ||||||||||||||||||||
Total interest on deposits | 2,935 | 21,205 | 24,140 | 5,991 | 40,473 | 46,464 | ||||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | (2,244 | ) | 6,105 | 3,861 | (5,237 | ) | 12,261 | 7,024 | ||||||||||||||||||
Other borrowings | (1,375 | ) | 695 | (680 | ) | (2,269 | ) | 1,534 | (735 | ) | ||||||||||||||||
Total interest expense | (684 | ) | 28,005 | 27,321 | (1,515 | ) | 54,268 | 52,753 | ||||||||||||||||||
Net interest income, fully taxable equivalent basis | $ | 2,081 | $ | (2,116 | ) | $ | (35 | ) | $ | 4,442 | $ | (1,383 | ) | $ | 3,059 | |||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
September 30, 2006 vs. 2005 | September 30, 2006 vs. 2005 | |||||||||||||||||||||||
Change due to | Change due to | |||||||||||||||||||||||
Average | Average | Average | Average | |||||||||||||||||||||
(In thousands) | Volume | Rate | Total | Volume | Rate | Total | ||||||||||||||||||
Interest income, fully taxable equivalent basis: | ||||||||||||||||||||||||
Loans | $ | 14,731 | $ | 24,197 | $ | 38,928 | $ | 34,929 | $ | 71,520 | $ | 106,449 | ||||||||||||
Investment securities: | ||||||||||||||||||||||||
U.S. government and federal agency securities | (2,864 | ) | 154 | (2,710 | ) | (12,733 | ) | (1,281 | ) | (14,014 | ) | |||||||||||||
State and municipal obligations | 3,211 | 378 | 3,589 | 8,366 | 354 | 8,720 | ||||||||||||||||||
Mortgage and asset-backed securities | (7,660 | ) | 1,302 | (6,358 | ) | (20,650 | ) | 4,652 | (15,998 | ) | ||||||||||||||
Other securities | (10 | ) | 1,198 | 1,188 | (31 | ) | 3,647 | 3,616 | ||||||||||||||||
Total interest on investment securities | (7,323 | ) | 3,032 | (4,291 | ) | (25,048 | ) | 7,372 | (17,676 | ) | ||||||||||||||
Federal funds sold and securities purchased under agreements to resell | 3,380 | 504 | 3,884 | 2,058 | 3,502 | 5,560 | ||||||||||||||||||
Total interest income | 10,788 | 27,733 | 38,521 | 11,939 | 82,394 | 94,333 | ||||||||||||||||||
Interest expense: | ||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||
Savings | (8 | ) | 256 | 248 | (39 | ) | 717 | 678 | ||||||||||||||||
Interest checking and money market | 256 | 11,336 | 11,592 | (245 | ) | 31,367 | 31,122 | |||||||||||||||||
Time open & C.D.’s of less than $100,000 | 3,081 | 6,806 | 9,887 | 6,229 | 17,394 | 23,623 | ||||||||||||||||||
Time open & C.D.’s of $100,000 and over | 3,426 | 4,871 | 8,297 | 6,604 | 14,461 | 21,065 | ||||||||||||||||||
Total interest on deposits | 6,755 | 23,269 | 30,024 | 12,549 | 63,939 | 76,488 | ||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | (2,219 | ) | 8,291 | 6,072 | (7,711 | ) | 20,807 | 13,096 | ||||||||||||||||
Other borrowings | (1,745 | ) | 463 | (1,282 | ) | (3,964 | ) | 1,947 | (2,017 | ) | ||||||||||||||
Total interest expense | 2,791 | 32,023 | 34,814 | 874 | 86,693 | 87,567 | ||||||||||||||||||
Net interest income, fully taxable equivalent basis | $ | 7,997 | $ | (4,290 | ) | $ | 3,707 | $ | 11,065 | $ | (4,299 | ) | $ | 6,766 | ||||||||||
20
19
21
20
Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||||||
(Dollars in thousands) | 2006 | 2005 | % Change | 2006 | 2005 | % Change | ||||||||||||||||||
Deposit account charges and other fees | $ | 28,910 | $ | 27,476 | 5.2 | % | $ | 56,407 | $ | 51,777 | 8.9 | % | ||||||||||||
Bank card transaction fees | 23,558 | 21,295 | 10.6 | 45,266 | 40,802 | 10.9 | ||||||||||||||||||
Trust fees | 17,992 | 17,040 | 5.6 | 35,811 | 33,434 | 7.1 | ||||||||||||||||||
Trading account profits and commissions | 2,010 | 2,450 | (18.0 | ) | 4,575 | 5,064 | (9.7 | ) | ||||||||||||||||
Consumer brokerage services | 2,771 | 2,338 | 18.5 | 5,160 | 5,163 | (.1 | ) | |||||||||||||||||
Loan fees and sales | 2,745 | 4,805 | (42.9 | ) | 6,488 | 8,245 | (21.3 | ) | ||||||||||||||||
Investment securities gains, net | 3,284 | 1,372 | 139.4 | 5,687 | 4,984 | 14.1 | ||||||||||||||||||
Other | 10,193 | 8,204 | 24.2 | 21,517 | 16,202 | 32.8 | ||||||||||||||||||
Total non-interest income | $ | 91,463 | $ | 84,980 | 7.6 | % | $ | 180,911 | $ | 165,671 | 9.2 | % | ||||||||||||
Non-interest income as a % of total revenue* | 41.1% | 39.6% | 41.2% | 39.2% | ||||||||||||||||||||
Nine Months Ended | ||||||||||||||||||||||||
Three Months Ended September 30 | September 30 | |||||||||||||||||||||||
(Dollars in thousands) | 2006 | 2005 | % Change | 2006 | 2005 | % Change | ||||||||||||||||||
Deposit account charges and other fees | $ | 29,723 | $ | 31,117 | (4.5 | )% | $ | 86,130 | $ | 82,894 | 3.9 | % | ||||||||||||
Bank card transaction fees | 24,187 | 21,981 | 10.0 | 69,453 | 62,783 | 10.6 | ||||||||||||||||||
Trust fees | 17,805 | 17,353 | 2.6 | 53,616 | 50,787 | 5.6 | ||||||||||||||||||
Trading account profits and commissions | 1,639 | 2,335 | (29.8 | ) | 6,214 | 7,399 | (16.0 | ) | ||||||||||||||||
Consumer brokerage services | 2,476 | 2,440 | 1.5 | 7,636 | 7,603 | .4 | ||||||||||||||||||
Loan fees and sales | 1,956 | 2,397 | (18.4 | ) | 8,444 | 10,642 | (20.7 | ) | ||||||||||||||||
Investment securities gains, net | 3,324 | 289 | N.M. | 9,011 | 5,273 | 70.9 | ||||||||||||||||||
Other | 9,546 | 8,983 | 6.3 | 31,063 | 25,185 | 23.3 | ||||||||||||||||||
Total non-interest income | $ | 90,656 | $ | 86,895 | 4.3 | % | $ | 271,567 | $ | 252,566 | 7.5 | % | ||||||||||||
Non-interest income as a % of total revenue* | 40.4% | 40.8% | 40.9% | 39.8% | ||||||||||||||||||||
* | Total revenue is calculated as net interest income plus non-interest income, excluding net securities gains/losses. |
21
22
Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||||||
(Dollars in thousands) | 2006 | 2005 | % Change | 2006 | 2005 | % Change | ||||||||||||||||||
Salaries and employee benefits | $ | 71,239 | $ | 67,585 | 5.4 | % | $ | 142,964 | $ | 137,765 | 3.8 | % | ||||||||||||
Net occupancy | 10,230 | 9,527 | 7.4 | 21,207 | 19,305 | 9.9 | ||||||||||||||||||
Equipment | 6,071 | 5,701 | 6.5 | 12,020 | 11,392 | 5.5 | ||||||||||||||||||
Supplies and communication | 7,872 | 8,257 | (4.7 | ) | 16,265 | 16,470 | (1.2 | ) | ||||||||||||||||
Data processing and software | 12,631 | 12,069 | 4.7 | 25,024 | 23,524 | 6.4 | ||||||||||||||||||
Marketing | 4,657 | 4,687 | (.6 | ) | 8,975 | 8,549 | 5.0 | |||||||||||||||||
Other | 16,850 | 15,186 | 11.0 | 33,056 | 29,929 | 10.4 | ||||||||||||||||||
Total non-interest expense | $ | 129,550 | $ | 123,012 | 5.3 | % | $ | 259,511 | $ | 246,934 | 5.1 | % | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
September 30 | September 30 | |||||||||||||||||||||||
(Dollars in thousands) | 2006 | 2005 | % Change | 2006 | 2005 | % Change | ||||||||||||||||||
Salaries and employee benefits | $ | 72,169 | $ | 66,682 | 8.2 | % | $ | 215,133 | $ | 204,447 | 5.2 | % | ||||||||||||
Net occupancy | 11,009 | 10,277 | 7.1 | 32,216 | 29,582 | 8.9 | ||||||||||||||||||
Equipment | 7,109 | 5,838 | 21.8 | 19,129 | 17,230 | 11.0 | ||||||||||||||||||
Supplies and communication | 8,073 | 8,458 | (4.6 | ) | 24,338 | 24,928 | (2.4 | ) | ||||||||||||||||
Data processing and software | 12,904 | 12,108 | 6.6 | 37,928 | 35,632 | 6.4 | ||||||||||||||||||
Marketing | 4,397 | 4,486 | (2.0 | ) | 13,372 | 13,035 | 2.6 | |||||||||||||||||
Other | 16,643 | 14,538 | 14.5 | 49,699 | 44,467 | 11.8 | ||||||||||||||||||
Total non-interest expense | $ | 132,304 | $ | 122,387 | 8.1 | % | $ | 391,815 | $ | 369,321 | 6.1 | % | ||||||||||||
23
22
Six Months Ended | |||||||||||||||||||||
Three Months Ended | June 30 | ||||||||||||||||||||
(Dollars in thousands) | June 30, 2006 | June 30, 2005 | March 31, 2006 | 2006 | 2005 | ||||||||||||||||
Provision for loan losses | $ | 5,672 | $ | 5,503 | $ | 4,432 | $ | 10,104 | $ | 7,871 | |||||||||||
Net loan charge-offs (recoveries): | |||||||||||||||||||||
Business | 259 | (48 | ) | (1,081 | ) | (822 | ) | (2,669 | ) | ||||||||||||
Credit card | 4,387 | 5,430 | 3,748 | 8,135 | 10,027 | ||||||||||||||||
Personal banking* | 446 | 1,474 | 1,649 | 2,095 | 3,422 | ||||||||||||||||
Real estate | 80 | (19 | ) | (255 | ) | (175 | ) | (225 | ) | ||||||||||||
Overdrafts | 522 | 198 | 350 | 872 | 282 | ||||||||||||||||
Total net loan charge-offs | $ | 5,694 | $ | 7,035 | $ | 4,411 | $ | 10,105 | $ | 10,837 | |||||||||||
Annualized total net charge-offs as a percentage of average loans | .25 | % | .33 | % | .20 | % | .22 | % | .26 | % | |||||||||||
Nine Months Ended | ||||||||||||||||||||
Three Months Ended | September 30 | |||||||||||||||||||
(Dollars in thousands) | Sept. 30, 2006 | Sept. 30, 2005 | June 30, 2006 | 2006 | 2005 | |||||||||||||||
Provision for loan losses | $ | 7,575 | $ | 8,934 | $ | 5,672 | $ | 17,679 | $ | 16,805 | ||||||||||
Net loan charge-offs (recoveries): | ||||||||||||||||||||
Business | 125 | 133 | 259 | (697 | ) | (2,536 | ) | |||||||||||||
Credit card | 4,588 | 5,879 | 4,387 | 12,723 | 15,906 | |||||||||||||||
Personal banking* | 1,924 | 1,837 | 446 | 4,019 | 5,259 | |||||||||||||||
Real estate | 175 | 492 | 80 | — | 267 | |||||||||||||||
Overdrafts | 1,063 | 715 | 522 | 1,935 | 997 | |||||||||||||||
Total net loan charge-offs | $ | 7,875 | $ | 9,056 | $ | 5,694 | $ | 17,980 | $ | 19,893 | ||||||||||
Annualized total net charge-offs as a percentage of average loans | .33 | % | .42 | % | .25 | % | .26 | % | .31 | % | ||||||||||
* | Includes consumer, student and home equity loans |
24
23
June 30 | December 31 | |||||||
(Dollars in thousands) | 2006 | 2005 | ||||||
Non-accrual loans | $ | 14,155 | $ | 9,845 | ||||
Foreclosed real estate | 1,793 | 1,868 | ||||||
Total non-performing assets | $ | 15,948 | $ | 11,713 | ||||
Non-performing assets to total loans | .17 | % | .13 | % | ||||
Non-performing assets to total assets | .11 | % | .08 | % | ||||
Loans past due 90 days and still accruing interest | $ | 15,186 | $ | 14,088 | ||||
September 30 | December 31 | |||||||
(Dollars in thousands) | 2006 | 2005 | ||||||
Non-accrual loans | $ | 18,845 | $ | 9,845 | ||||
Foreclosed real estate | 1,379 | 1,868 | ||||||
Total non-performing assets | $ | 20,224 | $ | 11,713 | ||||
Non-performing assets to total loans | .21 | % | .13 | % | ||||
Non-performing assets to total assets | .13 | % | .08 | % | ||||
Loans past due 90 days and still accruing interest | $ | 16,251 | $ | 14,088 | ||||
25
24
26
25
June 30 | March 31 | December 31 | |||||||||||
(In thousands) | 2006 | 2006 | 2005 | ||||||||||
Liquid assets: | |||||||||||||
Federal funds sold | $ | 112,072 | $ | 64,385 | $ | 108,862 | |||||||
Securities purchased under agreements to resell | 125,000 | 25,000 | 20,000 | ||||||||||
Available for sale investment securities | 3,337,477 | 3,401,823 | 3,667,901 | ||||||||||
Total | $ | 3,574,549 | $ | 3,491,208 | $ | 3,796,763 | |||||||
September 30 | June 30 | December 31 | ||||||||||
(In thousands) | 2006 | 2006 | 2005 | |||||||||
Liquid assets: | ||||||||||||
Federal funds sold | $ | 46,240 | $ | 112,072 | $ | 108,862 | ||||||
Securities purchased under agreements to resell | 449,022 | 125,000 | 20,000 | |||||||||
Available for sale investment securities | 3,533,073 | 3,337,477 | 3,667,901 | |||||||||
Total | $ | 4,028,335 | $ | 3,574,549 | $ | 3,796,763 | ||||||
27
June 30 | March 31 | December 31 | |||||||||||
(In thousands) | 2006 | 2006 | 2005 | ||||||||||
Core deposit base: | |||||||||||||
Non-interest bearing demand | $ | 1,326,787 | $ | 1,418,387 | $ | 1,399,934 | |||||||
Interest checking | 463,640 | 464,597 | 511,583 | ||||||||||
Savings and money market | 5,975,428 | 5,985,234 | 5,978,743 | ||||||||||
Total | $ | 7,765,855 | $ | 7,868,218 | $ | 7,890,260 | |||||||
September 30 | June 30 | December 31 | ||||||||||
(In thousands) | 2006 | 2006 | 2005 | |||||||||
Core deposit base: | ||||||||||||
Non-interest bearing demand | $ | 1,205,193 | $ | 1,326,787 | $ | 1,399,934 | ||||||
Interest checking | 424,590 | 463,640 | 511,583 | |||||||||
Savings and money market | 6,280,089 | 5,975,428 | 5,978,743 | |||||||||
Total | $ | 7,909,872 | $ | 7,765,855 | $ | 7,890,260 | ||||||
26
June 30 | March 31 | December 31 | |||||||||||
(In thousands) | 2006 | 2006 | 2005 | ||||||||||
Borrowings: | |||||||||||||
Federal funds purchased | $ | 1,005,430 | $ | 438,879 | $ | 849,504 | |||||||
Securities sold under agreements to repurchase | 581,081 | 463,044 | 476,923 | ||||||||||
FHLB advances | 128,689 | 241,733 | 251,776 | ||||||||||
Subordinated debentures | 4,000 | 4,000 | 4,000 | ||||||||||
Other long-term debt | 12,230 | 12,789 | 13,614 | ||||||||||
Other short-term debt | — | 94 | — | ||||||||||
Total | $ | 1,731,430 | $ | 1,160,539 | $ | 1,595,817 | |||||||
September 30 | June 30 | December 31 | ||||||||||
(In thousands) | 2006 | 2006 | 2005 | |||||||||
Borrowings: | ||||||||||||
Federal funds purchased | $ | 610,765 | $ | 1,005,430 | $ | 849,504 | ||||||
Securities sold under agreements to repurchase | 1,158,134 | 581,081 | 476,923 | |||||||||
FHLB advances | 140,260 | 128,689 | 251,776 | |||||||||
Subordinated debentures | 14,310 | 4,000 | 4,000 | |||||||||
Other long-term debt | 11,802 | 12,230 | 13,614 | |||||||||
Total | $ | 1,935,271 | $ | 1,731,430 | $ | 1,595,817 | ||||||
28
27
Minimum Ratios | ||||||||||||
for Well- | ||||||||||||
June 30 | December 31 | Capitalized | ||||||||||
(Dollars in thousands) | 2006 | 2005 | Banks | |||||||||
Risk-adjusted assets | $ | 11,322,781 | $ | 10,611,322 | ||||||||
Tier I capital | 1,303,344 | 1,295,898 | ||||||||||
Total capital | 1,454,738 | 1,446,408 | ||||||||||
Tier I capital ratio | 11.51 | % | 12.21 | % | 6.00 | % | ||||||
Total capital ratio | 12.85 | % | 13.63 | % | 10.00 | % | ||||||
Leverage ratio | 9.47 | % | 9.43 | % | 5.00 | % | ||||||
Minimum Ratios | ||||||||||||
for Well- | ||||||||||||
September 30 | December 31 | Capitalized | ||||||||||
(Dollars in thousands) | 2006 | 2005 | Banks | |||||||||
Risk-adjusted assets | $ | 11,877,647 | $ | 10,611,322 | ||||||||
Tier I capital | 1,356,843 | 1,295,898 | ||||||||||
Total capital | 1,512,549 | 1,446,408 | ||||||||||
Tier I capital ratio | 11.42 | % | 12.21 | % | 6.00 | % | ||||||
Total capital ratio | 12.73 | % | 13.63 | % | 10.00 | % | ||||||
Leverage ratio | 9.47 | % | 9.43 | % | 5.00 | % | ||||||
29
28
Six Months Ended | |||||||||||||||||
June 30 | Increase (decrease) | ||||||||||||||||
(Dollars in thousands) | 2006 | 2005 | Amount | Percent | |||||||||||||
Consumer | $ | 118,330 | $ | 88,785 | $ | 29,545 | 33.3 | % | |||||||||
Commercial | 68,828 | 63,311 | 5,517 | 8.7 | |||||||||||||
Money management | 17,239 | 15,340 | 1,899 | 12.4 | |||||||||||||
Total segments | 204,397 | 167,436 | 36,961 | 22.1 | |||||||||||||
Other/elimination | (42,887 | ) | (7,706 | ) | (35,181 | ) | N.M. | ||||||||||
Income before income taxes | $ | 161,510 | $ | 159,730 | $ | 1,780 | 1.1 | % | |||||||||
Nine Months Ended | ||||||||||||||||
September 30 | Increase (decrease) | |||||||||||||||
(Dollars in thousands) | 2006 | 2005 | Amount | Percent | ||||||||||||
Consumer | $ | 180,772 | $ | 142,911 | $ | 37,861 | 26.5 | % | ||||||||
Commercial | 106,969 | 97,528 | 9,441 | 9.7 | ||||||||||||
Money management | 25,243 | 23,882 | 1,361 | 5.7 | ||||||||||||
Total segments | 312,984 | 264,321 | 48,663 | 18.4 | ||||||||||||
Other/elimination | (71,944 | ) | (23,185 | ) | (48,759 | ) | N.M. | |||||||||
Income before income taxes | $ | 241,040 | $ | 241,136 | $ | (96 | ) | — | % | |||||||
30
29
31
30
32
31
33
Third Quarter 2006 | Third Quarter 2005 | |||||||||||||||||||||||
Interest | Avg. Rates | Interest | Avg. Rates | |||||||||||||||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | |||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Paid | Balance | Expense | Paid | ||||||||||||||||||
ASSETS: | ||||||||||||||||||||||||
Loans: | ||||||||||||||||||||||||
Business(A) | $ | 2,709,096 | $ | 46,488 | 6.81 | % | $ | 2,356,938 | $ | 32,675 | 5.50 | % | ||||||||||||
Real estate – construction | 582,542 | 11,333 | 7.72 | 518,638 | 7,970 | 6.10 | ||||||||||||||||||
Real estate – business | 2,082,020 | 36,672 | 6.99 | 1,775,132 | 26,920 | 6.02 | ||||||||||||||||||
Real estate – personal | 1,461,996 | 20,994 | 5.70 | 1,366,817 | 18,301 | 5.31 | ||||||||||||||||||
Consumer | 1,373,127 | 24,631 | 7.12 | 1,267,466 | 20,827 | 6.52 | ||||||||||||||||||
Home equity | 444,979 | 8,738 | 7.79 | 437,359 | 6,991 | 6.34 | ||||||||||||||||||
Student | 278,960 | 4,946 | 7.03 | 321,283 | 4,111 | 5.08 | ||||||||||||||||||
Credit card | 606,882 | 20,030 | 13.09 | 556,235 | 17,109 | 12.20 | ||||||||||||||||||
Overdrafts | 13,548 | — | — | 14,973 | — | — | ||||||||||||||||||
Total loans | 9,553,150 | 173,832 | 7.22 | 8,614,841 | 134,904 | 6.21 | ||||||||||||||||||
Investment securities: | ||||||||||||||||||||||||
U.S. government and federal agency | 591,513 | 5,331 | 3.58 | 918,993 | 8,041 | 3.47 | ||||||||||||||||||
State and municipal obligations(A) | 472,029 | 5,331 | 4.48 | 164,282 | 1,742 | 4.21 | ||||||||||||||||||
Mortgage and asset-backed securities | 2,171,567 | 23,976 | 4.38 | 2,905,599 | 30,334 | 4.14 | ||||||||||||||||||
Trading securities | 14,223 | 164 | 4.57 | 10,696 | 108 | 4.01 | ||||||||||||||||||
Other marketable securities(A) | 213,483 | 3,045 | 5.66 | 221,623 | 2,615 | 4.68 | ||||||||||||||||||
Non-marketable securities | 86,230 | 1,415 | 6.51 | 80,613 | 713 | 3.51 | ||||||||||||||||||
Total investment securities | 3,549,045 | 39,262 | 4.39 | 4,301,806 | 43,553 | 4.02 | ||||||||||||||||||
Federal funds sold and securities purchased under agreements to resell | 378,404 | 5,079 | 5.33 | 126,930 | 1,195 | 3.74 | ||||||||||||||||||
Total interest earning assets | 13,480,599 | 218,173 | 6.42 | 13,043,577 | 179,652 | 5.46 | ||||||||||||||||||
Less allowance for loan losses | (129,567 | ) | (128,228 | ) | ||||||||||||||||||||
Unrealized gain (loss) on investment securities | (16,049 | ) | 19,786 | |||||||||||||||||||||
Cash and due from banks | 461,447 | 478,428 | ||||||||||||||||||||||
Land, buildings and equipment, net | 377,423 | 376,289 | ||||||||||||||||||||||
Other assets | 257,938 | 197,053 | ||||||||||||||||||||||
Total assets | $ | 14,431,791 | $ | 13,986,905 | ||||||||||||||||||||
LIABILITIES AND EQUITY: | ||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||
Savings | $ | 393,732 | 566 | .57 | $ | 404,019 | 318 | .31 | ||||||||||||||||
Interest checking and money market | 6,678,352 | 25,735 | 1.53 | 6,759,046 | 14,143 | .83 | ||||||||||||||||||
Time open and C.D.’s of less than $100,000 | 2,155,446 | 23,238 | 4.28 | 1,752,749 | 13,351 | 3.02 | ||||||||||||||||||
Time open and C.D.’s of $100,000 and over | 1,320,235 | 15,706 | 4.72 | 902,654 | 7,409 | 3.26 | ||||||||||||||||||
Total interest bearing deposits | 10,547,765 | 65,245 | 2.45 | 9,818,468 | 35,221 | 1.42 | ||||||||||||||||||
Borrowings: | ||||||||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 1,580,998 | 20,287 | 5.09 | 1,724,082 | 14,215 | 3.27 | ||||||||||||||||||
Other borrowings(B) | 163,152 | 2,020 | 4.91 | 370,961 | 3,302 | 3.53 | ||||||||||||||||||
Total borrowings | 1,744,150 | 22,307 | 5.07 | 2,095,043 | 17,517 | 3.32 | ||||||||||||||||||
Total interest bearing liabilities | 12,291,915 | 87,552 | 2.83 | % | 11,913,511 | 52,738 | 1.76 | % | ||||||||||||||||
Non-interest bearing demand deposits | 644,103 | 602,016 | ||||||||||||||||||||||
Other liabilities | 112,189 | 96,667 | ||||||||||||||||||||||
Stockholders’ equity | 1,383,584 | 1,374,711 | ||||||||||||||||||||||
Total liabilities and equity | $ | 14,431,791 | $ | 13,986,905 | ||||||||||||||||||||
Net interest margin (T/E) | $ | 130,621 | $ | 126,914 | ||||||||||||||||||||
Net yield on interest earning assets | 3.84 | % | 3.86 | % | ||||||||||||||||||||
Second Quarter 2006 | Second Quarter 2005 | ||||||||||||||||||||||||
Interest | Avg. Rates | Interest | Avg. Rates | ||||||||||||||||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | ||||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Paid | Balance | Expense | Paid | |||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||
Business(A) | $ | 2,694,246 | $ | 43,529 | 6.48 | % | $ | 2,305,000 | $ | 29,449 | 5.12 | % | |||||||||||||
Real estate – construction | 508,127 | 9,331 | 7.37 | 478,675 | 6,776 | 5.68 | |||||||||||||||||||
Real estate – business | 1,997,502 | 33,844 | 6.80 | 1,765,896 | 25,259 | 5.74 | |||||||||||||||||||
Real estate – personal | 1,373,444 | 19,294 | 5.63 | 1,344,203 | 17,704 | 5.28 | |||||||||||||||||||
Consumer | 1,333,105 | 22,935 | 6.90 | 1,225,386 | 19,494 | 6.38 | |||||||||||||||||||
Home equity | 446,094 | 8,381 | 7.54 | 422,637 | 6,211 | 5.89 | |||||||||||||||||||
Student | 285,540 | 5,396 | 7.58 | 374,176 | 4,262 | 4.57 | |||||||||||||||||||
Credit card | 584,508 | 18,846 | 12.93 | 553,965 | 16,330 | 11.82 | |||||||||||||||||||
Overdrafts | 11,836 | — | — | 11,651 | — | — | |||||||||||||||||||
Total loans | 9,234,402 | 161,556 | 7.02 | 8,481,589 | 125,485 | 5.93 | |||||||||||||||||||
Investment securities: | |||||||||||||||||||||||||
U.S. government and federal agency | 696,820 | 6,030 | 3.47 | 1,130,042 | 12,915 | 4.58 | |||||||||||||||||||
State and municipal obligations(A) | 348,289 | 3,820 | 4.40 | 70,746 | 783 | 4.44 | |||||||||||||||||||
Mortgage and asset-backed securities | 2,165,999 | 23,211 | 4.30 | 2,925,252 | 29,949 | 4.11 | |||||||||||||||||||
Trading securities | 21,144 | 229 | 4.34 | 7,864 | 78 | 3.98 | |||||||||||||||||||
Other marketable securities(A) | 194,419 | 2,649 | 5.47 | 219,289 | 2,091 | 3.82 | |||||||||||||||||||
Non-marketable securities | 86,658 | 1,487 | 6.88 | 75,968 | 1,032 | 5.45 | |||||||||||||||||||
Total investment securities | 3,513,329 | 37,426 | 4.27 | 4,429,161 | 46,848 | 4.24 | |||||||||||||||||||
Federal funds sold and securities purchased under agreements to resell | 142,651 | 1,801 | 5.06 | 145,135 | 1,164 | 3.22 | |||||||||||||||||||
Total interest earning assets | 12,890,382 | 200,783 | 6.25 | 13,055,885 | 173,497 | 5.33 | |||||||||||||||||||
Less allowance for loan losses | (128,063 | ) | (129,995 | ) | |||||||||||||||||||||
Unrealized gain (loss) on investment securities | (21,378 | ) | 26,119 | ||||||||||||||||||||||
Cash and due from banks | 470,660 | 502,834 | |||||||||||||||||||||||
Land, buildings and equipment, net | 367,190 | 370,587 | |||||||||||||||||||||||
Other assets | 221,522 | 198,816 | |||||||||||||||||||||||
Total assets | $ | 13,800,313 | $ | 14,024,246 | |||||||||||||||||||||
LIABILITIES AND EQUITY: | |||||||||||||||||||||||||
Interest bearing deposits: | |||||||||||||||||||||||||
Savings | $ | 396,959 | 556 | .56 | $ | 417,059 | 325 | .31 | |||||||||||||||||
Interest checking and money market | 6,666,190 | 22,446 | 1.35 | 6,820,516 | 11,867 | .70 | |||||||||||||||||||
Time open and C.D.’s of less than $100,000 | 1,973,722 | 19,448 | 3.95 | 1,732,288 | 12,051 | 2.79 | |||||||||||||||||||
Time open and C.D.’s of $100,000 and over | 1,257,161 | 13,906 | 4.44 | 1,085,769 | 7,973 | 2.95 | |||||||||||||||||||
Total interest bearing deposits | 10,294,032 | 56,356 | 2.20 | 10,055,632 | 32,216 | 1.29 | |||||||||||||||||||
Borrowings: | |||||||||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 1,213,925 | 14,024 | 4.63 | 1,481,135 | 10,163 | 2.75 | |||||||||||||||||||
Other borrowings(B) | 205,472 | 2,394 | 4.67 | 380,043 | 3,074 | 3.24 | |||||||||||||||||||
Total borrowings | 1,419,397 | 16,418 | 4.64 | 1,861,178 | 13,237 | 2.85 | |||||||||||||||||||
Total interest bearing liabilities | 11,713,429 | 72,774 | 2.49 | % | 11,916,810 | 45,453 | 1.53 | % | |||||||||||||||||
Non-interest bearing demand deposits | 663,820 | 633,473 | |||||||||||||||||||||||
Other liabilities | 85,641 | 92,403 | |||||||||||||||||||||||
Stockholders’ equity | 1,337,423 | 1,381,560 | |||||||||||||||||||||||
Total liabilities and equity | $ | 13,800,313 | $ | 14,024,246 | |||||||||||||||||||||
Net interest margin (T/ E) | $ | 128,009 | $ | 128,044 | |||||||||||||||||||||
Net yield on interest earning assets | 3.98 | % | 3.93 | % | |||||||||||||||||||||
(A) | Stated on a tax equivalent basis using a federal income tax rate of 35%. |
(B) | Interest expense capitalized on construction projects is not deducted from the interest expense shown above. |
34
32
Nine Months 2006 | Nine Months 2005 | |||||||||||||||||||||||
Interest | Avg. Rates | Interest | Avg. Rates | |||||||||||||||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | |||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Paid | Balance | Expense | Paid | ||||||||||||||||||
ASSETS: | ||||||||||||||||||||||||
Loans: | ||||||||||||||||||||||||
Business(A) | $ | 2,649,218 | $ | 129,102 | 6.52 | % | $ | 2,303,147 | $ | 89,577 | 5.20 | % | ||||||||||||
Real estate – construction | 511,236 | 28,288 | 7.40 | 480,207 | 20,410 | 5.68 | ||||||||||||||||||
Real estate – business | 2,017,312 | 102,133 | 6.77 | 1,766,452 | 76,262 | 5.77 | ||||||||||||||||||
Real estate – personal | 1,398,341 | 58,918 | 5.63 | 1,348,798 | 53,452 | 5.30 | ||||||||||||||||||
Consumer | 1,331,847 | 69,111 | 6.94 | 1,228,911 | 58,877 | 6.41 | ||||||||||||||||||
Home equity | 446,079 | 25,085 | 7.52 | 424,209 | 18,762 | 5.91 | ||||||||||||||||||
Student | 307,857 | 15,519 | 6.74 | 368,168 | 12,728 | 4.62 | ||||||||||||||||||
Credit card | 589,750 | 57,452 | 13.02 | 552,416 | 49,091 | 11.88 | ||||||||||||||||||
Overdrafts | 15,142 | — | — | 14,302 | — | — | ||||||||||||||||||
Total loans | 9,266,782 | 485,608 | 7.01 | 8,486,610 | 379,159 | 5.97 | ||||||||||||||||||
Investment securities: | ||||||||||||||||||||||||
U.S. government and federal agency | 690,321 | 18,285 | 3.54 | 1,139,490 | 32,299 | 3.79 | ||||||||||||||||||
State and municipal obligations(A) | 360,936 | 11,950 | 4.43 | 100,210 | 3,230 | 4.31 | ||||||||||||||||||
Mortgage and asset-backed securities | 2,209,689 | 71,481 | 4.33 | 2,893,077 | 87,479 | 4.04 | ||||||||||||||||||
Trading securities | 18,109 | 587 | 4.33 | 9,974 | 288 | 3.86 | ||||||||||||||||||
Other marketable securities(A) | 200,656 | 8,190 | 5.46 | 219,528 | 6,386 | 3.89 | ||||||||||||||||||
Non-marketable securities | 85,640 | 4,332 | 6.76 | 77,825 | 2,819 | 4.84 | ||||||||||||||||||
Total investment securities | 3,565,351 | 114,825 | 4.31 | 4,440,104 | 132,501 | 3.99 | ||||||||||||||||||
Federal funds sold and securities purchased under agreements to resell | 221,802 | 8,503 | 5.13 | 119,171 | 2,943 | 3.30 | ||||||||||||||||||
Total interest earning assets | 13,053,935 | 608,936 | 6.24 | 13,045,885 | 514,603 | 5.27 | ||||||||||||||||||
Less allowance for loan losses | (128,692 | ) | (130,018 | ) | ||||||||||||||||||||
Unrealized gain (loss) on investment securities | (15,417 | ) | 31,187 | |||||||||||||||||||||
Cash and due from banks | 470,835 | 513,569 | ||||||||||||||||||||||
Land, buildings and equipment, net | 372,072 | 366,952 | ||||||||||||||||||||||
Other assets | 229,377 | 199,298 | ||||||||||||||||||||||
Total assets | $ | 13,982,110 | $ | 14,026,873 | ||||||||||||||||||||
LIABILITIES AND EQUITY: | ||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||
Savings | $ | 391,556 | 1,631 | .56 | $ | 408,308 | 953 | .31 | ||||||||||||||||
Interest checking and money market | 6,668,411 | 67,279 | 1.35 | 6,760,803 | 36,157 | .72 | ||||||||||||||||||
Time open and C.D.’s of less than $100,000 | 2,004,486 | 59,417 | 3.96 | 1,716,942 | 35,794 | 2.79 | ||||||||||||||||||
Time open and C.D.’s of $100,000 and over | 1,287,974 | 42,799 | 4.44 | 988,865 | 21,734 | 2.94 | ||||||||||||||||||
Total interest bearing deposits | 10,352,427 | 171,126 | 2.21 | 9,874,918 | 94,638 | 1.28 | ||||||||||||||||||
Borrowings: | ||||||||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 1,341,879 | 46,892 | 4.67 | 1,620,341 | 33,796 | 2.79 | ||||||||||||||||||
Other borrowings(B) | 209,378 | 7,200 | 4.60 | 379,860 | 9,217 | 3.24 | ||||||||||||||||||
Total borrowings | 1,551,257 | 54,092 | 4.66 | 2,000,201 | 43,013 | 2.88 | ||||||||||||||||||
Total interest bearing liabilities | 11,903,684 | 225,218 | 2.53 | % | 11,875,119 | 137,651 | 1.55 | % | ||||||||||||||||
Non-interest bearing demand deposits | 635,309 | 668,827 | ||||||||||||||||||||||
Other liabilities | 92,475 | 94,822 | ||||||||||||||||||||||
Stockholders’ equity | 1,350,642 | 1,388,105 | ||||||||||||||||||||||
Total liabilities and equity | $ | 13,982,110 | $ | 14,026,873 | ||||||||||||||||||||
Net interest margin (T/E) | $ | 383,718 | $ | 376,952 | ||||||||||||||||||||
Net yield on interest earning assets | 3.93 | % | 3.86 | % | ||||||||||||||||||||
Six Months 2006 | Six Months 2005 | ||||||||||||||||||||||||
Interest | Avg. Rates | Interest | Avg. Rates | ||||||||||||||||||||||
Average | Income/ | Earned/ | Average | Income/ | Earned/ | ||||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Paid | Balance | Expense | Paid | |||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||
Business(A) | $ | 2,618,783 | $ | 82,614 | 6.36 | % | $ | 2,275,806 | $ | 56,902 | 5.04 | % | |||||||||||||
Real estate – construction | 474,992 | 16,955 | 7.20 | 460,673 | 12,440 | 5.45 | |||||||||||||||||||
Real estate – business | 1,984,422 | 65,461 | 6.65 | 1,762,040 | 49,342 | 5.65 | |||||||||||||||||||
Real estate – personal | 1,365,986 | 37,924 | 5.60 | 1,339,639 | 35,151 | 5.29 | |||||||||||||||||||
Consumer | 1,310,865 | 44,480 | 6.84 | 1,209,314 | 38,050 | 6.34 | |||||||||||||||||||
Home equity | 446,638 | 16,347 | 7.38 | 417,525 | 11,771 | 5.69 | |||||||||||||||||||
Student | 322,545 | 10,573 | 6.61 | 391,999 | 8,617 | 4.43 | |||||||||||||||||||
Credit card | 581,042 | 37,422 | 12.99 | 550,475 | 31,982 | 11.72 | |||||||||||||||||||
Overdrafts | 15,952 | — | — | 13,961 | — | — | |||||||||||||||||||
Total loans | 9,121,225 | 311,776 | 6.89 | 8,421,432 | 244,255 | 5.85 | |||||||||||||||||||
Investment securities: | |||||||||||||||||||||||||
U.S. government and federal agency | 740,544 | 12,954 | 3.53 | 1,251,566 | 24,258 | 3.91 | |||||||||||||||||||
State and municipal obligations(A) | 304,469 | 6,619 | 4.38 | 67,643 | 1,488 | 4.44 | |||||||||||||||||||
Mortgage and asset-backed securities | 2,229,066 | 47,505 | 4.30 | 2,886,712 | 57,145 | 3.99 | |||||||||||||||||||
Trading securities | 20,084 | 423 | 4.25 | 9,607 | 180 | 3.77 | |||||||||||||||||||
Other marketable securities(A) | 194,136 | 5,145 | 5.34 | 218,463 | 3,771 | 3.48 | |||||||||||||||||||
Non-marketable securities | 85,340 | 2,917 | 6.89 | 76,408 | 2,106 | 5.56 | |||||||||||||||||||
Total investment securities | 3,573,639 | 75,563 | 4.26 | 4,510,399 | 88,948 | 3.98 | |||||||||||||||||||
Federal funds sold and securities purchased under agreements to resell | 142,203 | 3,424 | 4.86 | 115,227 | 1,748 | 3.06 | |||||||||||||||||||
Total interest earning assets | 12,837,067 | 390,763 | 6.14 | 13,047,058 | 334,951 | 5.18 | |||||||||||||||||||
Less allowance for loan losses | (128,247 | ) | (130,928 | ) | |||||||||||||||||||||
Unrealized gain (loss) on investment securities | (15,096 | ) | 36,982 | ||||||||||||||||||||||
Cash and due from banks | 475,607 | 531,431 | |||||||||||||||||||||||
Land, buildings and equipment, net | 369,352 | 362,206 | |||||||||||||||||||||||
Other assets | 214,860 | 200,439 | |||||||||||||||||||||||
Total assets | $ | 13,753,543 | $ | 14,047,188 | |||||||||||||||||||||
LIABILITIES AND EQUITY: | |||||||||||||||||||||||||
Interest bearing deposits: | |||||||||||||||||||||||||
Savings | $ | 390,450 | 1,065 | .55 | $ | 410,488 | 635 | .31 | |||||||||||||||||
Interest checking and money market | 6,663,358 | 41,544 | 1.26 | 6,761,696 | 22,014 | .66 | |||||||||||||||||||
Time open and C.D.’s of less than $100,000 | 1,927,755 | 36,179 | 3.78 | 1,698,742 | 22,443 | 2.66 | |||||||||||||||||||
Time open and C.D.’s of $100,000 and over | 1,271,576 | 27,093 | 4.30 | 1,032,685 | 14,325 | 2.80 | |||||||||||||||||||
Total interest bearing deposits | 10,253,139 | 105,881 | 2.08 | 9,903,611 | 59,417 | 1.21 | |||||||||||||||||||
Borrowings: | |||||||||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 1,220,338 | 26,605 | 4.40 | 1,567,611 | 19,581 | 2.52 | |||||||||||||||||||
Other borrowings(B) | 232,874 | 5,180 | 4.49 | 384,383 | 5,915 | 3.10 | |||||||||||||||||||
Total borrowings | 1,453,212 | 31,785 | 4.41 | 1,951,994 | 25,496 | 2.63 | |||||||||||||||||||
Total interest bearing liabilities | 11,706,351 | 137,666 | 2.37 | % | 11,855,605 | 84,913 | 1.44 | % | |||||||||||||||||
Non-interest bearing demand deposits | 630,839 | 702,786 | |||||||||||||||||||||||
Other liabilities | 82,455 | 93,884 | |||||||||||||||||||||||
Stockholders’ equity | 1,333,898 | 1,394,913 | |||||||||||||||||||||||
Total liabilities and equity | $ | 13,753,543 | $ | 14,047,188 | |||||||||||||||||||||
Net interest margin (T/ E) | $ | 253,097 | $ | 250,038 | |||||||||||||||||||||
Net yield on interest earning assets | 3.98 | % | 3.86 | % | |||||||||||||||||||||
(A) | Stated on a tax equivalent basis using a federal income tax rate of 35%. |
(B) | Interest expense capitalized on construction projects is not deducted from the interest expense shown above. |
35
33
Item 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
June 30, 2006 | March 31, 2006 | December 31, 2005 | ||||||||||||||||||||||
$ Change in | % Change in | $ Change in | % Change in | $ Change in | % Change in | |||||||||||||||||||
Net Interest | Net Interest | Net Interest | Net Interest | Net Interest | Net Interest | |||||||||||||||||||
(Dollars in millions) | Income | Income | Income | Income | Income | Income | ||||||||||||||||||
200 basis points rising | $ | (5.1 | ) | (1.00 | )% | $ | (2.6 | ) | (.52 | )% | $ | (5.8 | ) | (1.14 | )% | |||||||||
100 basis points rising | (1.7 | ) | (.32 | ) | (.2 | ) | (.04 | ) | (1.9 | ) | (.37 | ) | ||||||||||||
100 basis points falling | (.9 | ) | (.19 | ) | (1.5 | ) | (.29 | ) | (1.7 | ) | (.33 | ) | ||||||||||||
200 basis points falling | (3.6 | ) | (.71 | ) | (4.9 | ) | (.96 | ) | (4.7 | ) | (.93 | ) | ||||||||||||
September 30, 2006 | June 30, 2006 | December 31, 2005 | ||||||||||||||||||||||
$ Change in | % Change in | $ Change in | % Change in | $ Change in | % Change in | |||||||||||||||||||
Net Interest | Net Interest | Net Interest | Net Interest | Net Interest | Net Interest | |||||||||||||||||||
(Dollars in millions) | Income | Income | Income | Income | Income | Income | ||||||||||||||||||
200 basis points rising | $ | (4.6 | ) | (.86 | )% | $ | (5.1 | ) | (1.00 | )% | $ | (5.8 | ) | (1.14 | )% | |||||||||
100 basis points rising | (1.3 | ) | (.24 | ) | (1.7 | ) | (.32 | ) | (1.9 | ) | (.37 | ) | ||||||||||||
100 basis points falling | (.5 | ) | (.09 | ) | (.9 | ) | (.19 | ) | (1.7 | ) | (.33 | ) | ||||||||||||
200 basis points falling | (1.5 | ) | (.29 | ) | (3.6 | ) | (.71 | ) | (4.7 | ) | (.93 | ) | ||||||||||||
36
34
Item 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Total | Total Number of | Maximum Number | ||||||||||||||
Number | Average | Shares Purchased | that May Yet Be | |||||||||||||
of Shares | Price Paid | as part of Publicly | Purchased Under | |||||||||||||
Period | Purchased | per Share | Announced Program | the Program | ||||||||||||
April 1 – 30, 2006 | 862 | $ | 51.85 | 862 | 3,073,431 | |||||||||||
May 1 – 31, 2006 | 305,878 | $ | 50.65 | 305,878 | 2,767,553 | |||||||||||
June 1 – 30, 2006 | 179,720 | $ | 50.77 | 179,720 | 2,587,833 | |||||||||||
Total | 486,460 | $ | 50.70 | 486,460 | 2,587,833 | |||||||||||
Total | Total Number of | Maximum Number | ||||||||||||||
Number | Average | Shares Purchased | that May Yet Be | |||||||||||||
of Shares | Price Paid | as part of Publicly | Purchased Under | |||||||||||||
Period | Purchased | per Share | Announced Program | the Program | ||||||||||||
July 1 – 31, 2006 | 2,763 | $ | 50.92 | 2,763 | 2,585,070 | |||||||||||
August 1 – 31, 2006 | 4,087 | $ | 50.61 | 4,087 | 2,580,983 | |||||||||||
September 1 – 30, 2006 | 74,964 | $ | 50.21 | 74,964 | 2,506,019 | |||||||||||
Total | 81,814 | $ | 50.25 | 81,814 | 2,506,019 | |||||||||||
Name of Director | Votes For | Votes Withheld | ||||||
Jonathan M. Kemper | 51,511,449 | 308,269 | ||||||
Seth M. Leadbeater | 51,488,313 | 331,405 | ||||||
Terry O. Meek | 51,530,666 | 289,052 | ||||||
Mary Ann Van Lokeren | 51,529,685 | 290,033 | ||||||
Votes For | Votes Against | Votes Abstain | ||||||
51,048,260 | 1,258,537 | 107,752 | ||||||
Item 6. | EXHIBITS |
37
35
By | /s/J. Daniel Stinnett |
By | /s/Jeffery D. Aberdeen |
38
36
39
37