EXHIBIT 99.1
StellarOne Corporation Reports Fourth Quarter Results
Earnings of $0.10 Per Share Driven by Revenue Growth and Continuing Improvement in Asset Quality
CHARLOTTESVILLE, Va., Jan. 26, 2011 (GLOBE NEWSWIRE) -- StellarOne Corporation (Nasdaq:STEL) (StellarOne) today reported fourth quarter 2010 earnings of $2.8 million and net income available to common shareholders, which deducts from net income the dividends and discount accretion on preferred stock, of $2.4 million or $0.10 net income per diluted common share. Those results compare to net income available to common shareholders of $80 thousand or $0.00 income per diluted common share during the same quarter in the prior year. For the year, StellarOne earnings available to common shareholders were $7.9 million or $0.35 per common share, compared to a loss of $10.4 million or $0.46 per dil uted common share in 2009.
"We are pleased with the continued improvement in our credit quality and earnings results, and believe our company is positioned well to see continued improvement in 2011," said O. R. Barham, Jr., President and Chief Executive Officer. "Loan activity is encouraging and there are certainly signs of an improving economy. High on our list of initiatives for 2011 will be to address repayment of our preferred stock associated with the Troubled Asset Relief Program (TARP). While there are many reasons for this, the single largest consideration is to regain the ability to increase dividends to our common shareholders as conditions improve and earnings will support."
Fourth quarter 2010 notable items include:
- Net interest income increased $1.2 million for the quarter, as the net interest margin expanded twenty-four basis points on a sequential quarter basis.
- Non-performing asset levels decreased $7.8 million on a sequential basis, lowering the ratio of non-performing assets as a percentage of total assets to 1.85% as of December 31, 2010, compared to 2.13% as of September 30, 2010.
- The accelerated resolution of problem credits resulted in higher charge-offs for the quarter, with annualized net charge-offs as a percentage of average loans outstanding of 1.43% for the fourth quarter of 2010, compared to 0.94% for the third quarter of 2010.
- Noninterest income on an operating basis decreased 10.8% due to increased write-downs of foreclosed assets and lower fee income from retail banking, while elevated mortgage banking revenues continue to be offset somewhat by losses from mortgage indemnifications. Approximately 80% of current mortgage indemnification claims were settled during the quarter.
- Pre-tax, pre-provision earnings amounted to $8.6 million for the fourth quarter of 2010, an increase of $515 thousand or 6.4% compared to the third quarter of 2010, and an increase of $5.1 million or greater than 100% when compared to the same period in the prior year.
Net Interest Margin Expands for Fifth Consecutive Quarter
Net interest income on a tax-equivalent basis amounted to $25.4 million for the fourth quarter of 2010, which compares to $24.2 million for the third quarter of 2010, and $23.5 million for the same period in the prior year. The net interest margin was 3.87% for the fourth quarter of 2010, compared to 3.63% for the third quarter of 2010, and 3.45% for the fourth quarter of 2009. The average yield on earning assets for the current quarter increased 9 basis points to 4.93% as compared to 4.84% for the third quarter of 2010, which was complemented by a 17 basis point improvement in the cost of interest-bearing liabilities, moving from 1.43% during the third quarter of 2010 to 1.26% during the fourth quarter of 2010. The re-pricing sensitivity of interest-bearing liabilities outpaced interest earning assets during the fourth quarter as approximately $199.2 million or 22.4% of the CD portfolio re-priced resulting in a decrease of 21 basis points and 29 basis points for time deposits less than $100 thousand and gr eater than $100 thousand, respectively. Additionally, the cost of funds associated with FHLB advances decreased 17 basis points as three higher priced advances matured near the end of the prior quarter and the cost of money market accounts was reduced sequentially by 12 basis points.
Operating Noninterest Income Decreases Sequentially
On an operating basis, which excludes gains and losses from sales and impairments of securities and other assets, total noninterest income amounted to $7.1 million for the fourth quarter of 2010, down $863 thousand or 10.8% on a sequential basis compared to $8.0 million for the third quarter of 2010, and up $1.0 million or 16.9% from $6.1 million for the same period in the prior year. The sequential quarter decrease on a consolidated basis is largely attributable to a $670 thousand increase in write-downs of foreclosed assets and a $225 thousand contraction in retail banking fees. The increase on a company-wide basis compared to the same period in the prior year was driven by a combination of a $635 thousand increase in mortgage banking fees, $325 thousand decrease in write-downs of foreclosed assets, $275 thousand increase in other operating revenues associated with pass through investments, and a $99 thousand increase in wealth management related revenues that was partially offset by a $315 thousand contr action in retail banking fees.
Mortgage banking revenue totaled $2.8 million for the fourth quarter of 2010, up $167 thousand or 6.4% compared to $2.6 million for the third quarter of 2010, and up $762 thousand or 38.0% when compared to the same quarter in 2009. The mortgage revenue increase for the fourth quarter was offset by $854 thousand in indemnification losses recognized. Approximately $504 thousand of the current quarter expense was associated with a settlement totaling $1.45 million, which extinguished all outstanding and potential mortgage repurchase and make-whole claims arising out of alleged representations and warranties breaches related to loans sold by StellarOne or its legacy companies to a primary investor prior to January 1, 2009. This settlement resolved approximately 80% of current claims outstanding with all investors and is anticipated to mitigate future off-balance sheet risk associated with repurchase and indemnifications. The business segment remained modestly profitable for both the quarter and the year despite the impact of indemnifications.
Retail banking fee income amounted to $3.9 million for the fourth quarter of 2010, a decrease of $226 thousand or 5.5% compared to $4.1 million for the third quarter of 2010. This sequential quarter decrease was attributable to a decrease of $198 thousand in consumer NSF and interchange fee income, which resulted from implementing the modifications to Regulation E that became effective during the previous quarter.
Wealth management revenues from trust and brokerage fees for the fourth quarter of 2010 were $1.2 million or up $21 thousand or 1.8% when compared to the $1.1 million realized during the third quarter of 2010, and up $99 thousand or 9.4% when compared to the fourth quarter of 2009. Higher fee realizations attributed to the revenue increase. Fiduciary assets increased sequentially to $489.7 million, compared to $457.9 million at September 30, 2010. This business segment was profitable for both the current quarter and the year.
Non-performing Asset Levels Continue Positive Trend
StellarOne's non-performing assets totaled $54.4 million at December 31, 2010, down $7.7 million or 12.4% from $62.1 million at September 30, 2010 and down $10.3 million or 15.9% compared to $64.7 million at December 31, 2009. The ratio of non-performing assets as a percentage of total assets decreased sequentially to 1.85% as of December 31, 2010, compared to 2.13% at both September 30, 2010 and December 31, 2009. Non-performing loans totaled $43.0 million at December 31, 2010, down $8.1 million or 15.9% when compared to $51.1 million at September 30, 2010 and down $16.3 million or 27.5% compared to $59.3 million at December 31, 2009. Foreclosed assets totaled $10.9 million, up $359 thousand or 3.4% compared to $10.5 million at September 30, 2010 and up $6.4 million or greater than 100% compared to December 31, 2009. Past due and matured loans between 30 and 89 days totaled $52.8 million at December 31, 2010, up $3.5 million or 7.1% compared to $49.3 million at September 30, 2010.
Annualized net charge-offs as a percentage of average loans receivable amounted to 1.43% for the fourth quarter of 2010, up compared to 0.78% for the full-year 2009 results and up sequentially from 0.94% for the third quarter of 2010. Net charge-offs for the fourth quarter of 2010 totaled $7.6 million, up $2.63 million compared to the $5.1 million realized during the third quarter of 2010 and up $3.3 million when compared to $4.4 million during the fourth quarter of 2009.
The mix of non-performing loans continues to be weighted to the residential development and construction loan segment of our portfolio. Of the total nonaccrual loans of $43.0 million at December 31, 2010, approximately $15.4 million are residential development and construction loans.
StellarOne recorded a provision for loan losses of $5.3 million for the fourth quarter of 2010, an increase of $1.8 million compared both sequentially and to the same period in the prior year. The fourth quarter 2010 provision compares to net charge-offs of $7.6 million, resulting in an allowance as a percentage of total loans of 1.79%, down thirteen basis points when compared to 1.92% as of September 30, 2010. Specific reserves within the allowance dropped $2.2 million from third quarter 2010 to fourth quarter due to the resolution of problem loans and related charge-offs taken during the current quarter. This resulted in a decrease to the allowance as a percentage of total loans while the coverage of non-performing loans increased. The allowance represents 87.6% of non-performing loans at December 31, 2010, up 9.3% when compared to 78.3% at September 30, 2010.
Efficiency Ratio Decreases Sequentially
StellarOne's efficiency ratio was 71.5% for the fourth quarter of 2010, compared to 81.3% for the fourth quarter of 2009 and 71.8% for the third quarter of 2010. The sequential quarter stability in the efficiency ratio reflects a slight increase in both noninterest expense and total revenue. Noninterest expense for the fourth quarter amounted to $24.0 million, up $291 thousand or 1.2% when compared to $23.7 million for the third quarter of 2010 and down $822 thousand or 3.3% when compared to the fourth quarter in 2009. The sequential increase was driven by increases of $116 thousand in compensation and employee benefits associated with higher mortgage production levels, $174 thousand in net occupancy costs related to more maintenance and repairs, and $143 thousand in supplies and equipment. These increases were offset by decreases in professional fees and FDIC insurance expense of $126 thousand and $147 thousand, respectively.
Capital Levels Remain Robust
StellarOne's risk-based capital ratios remain well above regulatory standards for well-capitalized banks. The period-end tangible common equity ratio was 9.79% at December 31, 2010 compared to 9.96% at September 30, 2010. Tier 1 risk-based and total risk-based capital ratios were 14.19% and 15.44%, respectively, at December 31, 2010 compared to 14.49% and 15.74% at September 30, 2010. Excluding the $30 million in preferred stock issued in connection with participation in the TARP program, StellarOne's Tier 1 risk-based common ratio was 12.83% compared to 13.19% at September 30, 2010. Shareholders' equity, excluding the preferred stock, represented 13.48% of total assets at December 31, 2010, while book value per common share was $17.43 per share.
Loan Activity Improves While Balance Sheet Remains Stable
Period end loans increased $16.1 million as compared to the third quarter, while average loans for the fourth quarter of 2010 were $2.13 billion, down approximately 0.7% when compared to $2.14 billion for the third quarter of 2010. Average securities were $367.1 million for the fourth quarter, down $30.8 million or 7.7% from $397.9 million for the third quarter of 2010. Average deposits for the fourth quarter of 2010 were $2.38 billion or flat on a sequential quarter basis. Average interest-bearing deposits decreased sequentially by approximately $7.9 million, while average non-interest-bearing deposits increased approximately $10.2 million. At December 31, 2010, total assets were $2.94 billion, compared to $2.92 billion at September 30, 2010. Cash and cash equivalents were $139.9 million at December 31, 2010, an increase of $31.0 million or 28.5% compared to $108.9 million at September 30, 2010.
About StellarOne
StellarOne Corporation is a traditional community bank, offering a full range of business and consumer banking services, including trust and wealth management services. StellarOne's sole banking affiliate, StellarOne Bank, operates 56 full-service financial centers, one loan production office, and a suite of ATMs serving the New River Valley, Roanoke Valley, Shenandoah Valley, and Central and North Central Virginia.
Earnings Webcast
To hear a live webcast of StellarOne's fourth quarter 2010 earnings conference call at 11:00 a.m. (ET) today, please visit our website at www.StellarOne.com and click on the Investor Relations section for detailed instructions on how to participate. Replays of the conference call will be available from 2:00 p.m. (ET) on Wednesday, January 26, 2011 through 11:59 p.m. (ET) on Wednesday, February 2, 2011, by dialing toll free (800) 642-1687 and using passcode #38005629.
Non-GAAP Financial Measures
This report refers to the efficiency ratio, which is computed by dividing noninterest expense less amortization of intangibles, foreclosed property expense, and goodwill impairments as a percent of the sum of net interest income on a tax equivalent basis and noninterest income excluding only gains on securities. Comparison of our efficiency ratio or operating earnings with those of other companies may not be possible because other companies may calculate them differently. It also refers to operating earnings, which reflects net income adjusted for nonrecurring expenses associated with mergers, asset gains and losses or expenses that are unusual in nature. Pre-tax, pre-provision earnings, which adds back provision and tax expense to net income, is used to demonstrate a more representative comparison of operational performance without the volatility of credit quality that is typically present in times of economic stress. The tangible common equity and Tier 1 common equity ratios are used by management to asse ss the quality of capital, and management believes that investors may find them useful in their analysis of the company. These capital measures are not necessarily comparable to similar capital measures that may be presented by other companies. Such information is not in accordance with generally accepted accounting principles in the United States (GAAP) and should not be construed as such. These are non-GAAP financial measures that we believe provide investors with important information regarding our operational efficiency. Management believes such financial information is meaningful to the reader in understanding operating performance but cautions that such information should not be viewed as a substitute for GAAP. StellarOne, in referring to its net income, is referring to income under GAAP.
Forward-Looking Statements
In addition to historical information, this press release contains forward-looking statements. The forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from historical results, or those anticipated. When we use words such as "believes," "expects," "anticipates" or similar expressions, we are making forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date thereof. StellarOne wishes to caution the reader that factors, such as those listed below, in some cases have affected and could affect StellarOne's actual results, causing actual results to differ materially from those in any forward-looking statement. These factors include: (i) expected cost savings from StellarOne's acquisitions and dispositions, (ii) competitive pressure in the banking industry or in StellarOne's markets may increase significantly, (iii) changes in t he interest rate environment may reduce margins, (iv) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, credit quality deterioration, (v) changes may occur in banking legislation and regulation, (vi) changes may occur in general business conditions, (vii) changes may occur in the securities markets, and (viii) the impact of governmental restrictions on entities participating in the US Treasury Department Capital Purchase Program. Please refer to StellarOne's filings with the Securities and Exchange Commission for additional information, which may be accessed at www.StellarOne.com.
NOTE: Risk-based capital ratios are preliminary.
SELECTED FINANCIAL DATA (UNAUDITED) | ||||
STELLARONE CORPORATION (Nasdaq:STEL) | ||||
(Dollars in thousands, except per share data) | ||||
SUMMARY INCOME STATEMENT | Three Months Ended December | Twelve Months Ended December | ||
2010 | 2009 | 2010 | 2009 | |
Interest income - taxable equivalent | $ 32,373 | $ 34,740 | $ 130,471 | $ 142,243 |
Interest expense | 6,950 | 11,200 | 33,912 | 50,642 |
Net interest income - taxable equivalent | 25,423 | 23,540 | 96,559 | 91,601 |
Less: taxable equivalent adjustment | 663 | 641 | 2,549 | 2,404 |
Net interest income | 24,760 | 22,899 | 94,010 | 89,197 |
Provision for loan and lease losses | 5,300 | 3,500 | 22,850 | 37,800 |
Net interest income after provision for loan and lease losses | 19,460 | 19,399 | 71,160 | 51,397 |
Noninterest income | 7,827 | 5,451 | 33,269 | 26,140 |
Noninterest expense | 23,956 | 24,778 | 92,959 | 93,661 |
Income tax expense (benefit) | 502 | (474) | 1,705 | (7,594) |
Net income (loss) | 2,829 | 546 | 9,765 | (8,530) |
Dividends and accretion on preferred stock | (378) | (378) | (1,500) | (1,500) |
Accretion of preferred stock discount | (94) | (88) | (365) | (334) |
Net income (loss) available to common shareholders | $ 2,357 | $ 80 | $ 7,900 | $ (10,364) |
Earnings (Loss) per share available to common shareholders | ||||
Basic | $ 0.10 | $ 0.00 | $ 0.35 | $ (0.46) |
Diluted | $ 0.10 | $ 0.00 | $ 0.35 | $ (0.46) |
SUMMARY AVERAGE BALANCE SHEET | Three Months Ended December | Twelve Months Ended December | ||
2010 | 2009 | 2010 | 2009 | |
Total loans | $ 2,129,457 | $ 2,246,934 | $ 2,161,387 | $ 2,270,754 |
Total securities | 367,079 | 350,171 | 375,928 | 333,737 |
Total earning assets | 2,604,363 | 2,707,923 | 2,644,417 | 2,707,714 |
Total assets | 2,946,014 | 3,029,485 | 2,976,744 | 3,031,637 |
Total deposits | 2,378,594 | 2,413,767 | 2,386,730 | 2,394,933 |
Shareholders' equity | 428,478 | 422,788 | 425,638 | 428,373 |
PERFORMANCE RATIOS | Three Months Ended December | Twelve Months Ended December | ||
2010 | 2009 | 2010 | 2009 | |
Return on average assets | 0.38% | 0.07% | 0.33% | -0.28% |
Return on average equity | 2.62% | 0.52% | 2.29% | -1.99% |
Return on average realized equity (A) | 2.66% | 0.52% | 2.33% | -2.01% |
Net interest margin (taxable equivalent) | 3.87% | 3.45% | 3.65% | 3.38% |
Efficiency (taxable equivalent) (B) | 71.47% | 81.28% | 70.47% | 76.79% |
CAPITAL MANAGEMENT | December 31, | |||
2010 | 2009 | |||
Tier 1 risk-based capital ratio | 14.19% | 13.21% | ||
Tangible equity ratio | 10.85% | 10.26% | ||
Tangible common equity ratio | 9.79% | 9.23% | ||
Period end shares issued and outstanding | 22,748,062 | 22,661,125 | ||
Book value per common share | 17.43 | 17.24 | ||
Tangible book value per common share | 12.14 | 11.86 | ||
Three Months Ended December | Twelve Months Ended December | |||
2010 | 2009 | 2010 | 2009 | |
Shares issued | -- | -- | 86,937 | 56,062 |
Average common shares issued and outstanding | 22,747,546 | 22,661,125 | 22,721,246 | 22,644,931 |
Average diluted common shares issued and outstanding | 22,816,864 | 22,700,405 | 22,779,584 | 22,692,423 |
Cash dividends paid per common share | $ 0.04 | $ 0.04 | $ 0.16 | $ 0.28 |
SUMMARY ENDING BALANCE SHEET | December 31, | |||
2010 | 2009 | |||
Total loans | $ 2,098,896 | $ 2,185,538 | ||
Total securities | 381,231 | 378,961 | ||
Total earning assets | 2,637,179 | 2,710,439 | ||
Total assets | 2,940,442 | 3,033,101 | ||
Total deposits | 2,386,102 | 2,436,120 | ||
Shareholders' equity | 426,437 | 420,785 | ||
OTHER DATA | ||||
End of period full time equivalent employees | 838 | 827 | ||
NOTES: | ||||
(A) Excludes the effect on average stockholders' equity of unrealized gains (losses) that result from changes in market values of securities and other comprehensive pension expense. | ||||
(B) Computed by dividing non-interest expense less amortization of intangibles, foreclosed asset expense and goodwill impairments by the sum of net interest income on a fully tax equivalent basis and non-interest income excluding only gains on securities. This is a non-GAAP financial measure, which we believe provides investors with important information regarding our operational efficiency. Comparison of our efficiency ratio with those of other companies may not be possible, because other companies may calculate the efficiency ratio differently. | ||||
(C) Individual amounts shown above are calculated from actual, not rounded amounts in the thousands, which appear above. |
QUARTERLY PERFORMANCE SUMMARY (UNAUDITED) | |||||
STELLARONE CORPORATION (Nasdaq:STEL) | |||||
(Dollars in thousands) | |||||
CREDIT QUALITY | Three Months Ended December | Twelve Months Ended December | |||
2010 | 2009 | 2010 | 2009 | ||
Allowance for loan losses: | |||||
Beginning of period | $ 39,973 | $ 41,040 | $ 40,172 | $ 30,464 | |
Provision for loan losses | 5,300 | 3,500 | 22,850 | 37,800 | |
Charge-offs | (8,192) | (5,151) | (27,577) | (30,947) | |
Recoveries | 568 | 783 | 2,204 | 2,855 | |
Net charge-offs | (7,624) | (4,368) | (25,373) | (28,092) | |
End of period | $ 37,649 | $ 40,172 | $ 37,649 | $ 40,172 | |
Accruing Troubled Debt Restructurings | $ 33,267 | $ 20,680 | |||
Loans greater than 90 days past due still accruing | $ -- | $ 1,511 | |||
December 31, | |||||
2010 | 2009 | ||||
Non accrual loans | $ 37,534 | $ 56,624 | |||
Non accrual TDR's | 5,426 | 2,678 | |||
Total non-performing loans | 42,960 | 59,302 | |||
Loans held for sale | 514 | 936 | |||
Foreclosed assets | 10,894 | 4,505 | |||
Total non-performing assets | $ 54,368 | $ 64,743 | |||
Nonperforming assets as a % of total assets | 1.85% | 2.13% | |||
Nonperforming assets as a % of loans plus foreclosed assets | 2.58% | 2.96% | |||
Allowance for loan losses as a % of total loans | 1.79% | 1.84% | |||
Net charge-offs as a % of average loans outstanding - 3 months | 1.43% | 0.78% | |||
Net charge-offs as a % of average loans outstanding - 12 months | 1.17% | 1.24% | |||
December 31, 2010 | |||||
Loans Outstanding | Nonaccrual Loans | Nonaccrual Loans to Loans Outstanding | |||
Commercial: | |||||
Commercial & industrial | $ 176,411 | $ 4,277 | 2.42% | ||
Agriculture | 723 | -- | N/A | ||
Total commercial | 177,134 | 4,277 | 2.41% | ||
Commercial real estate: | |||||
Construction, land development & vacant land | 180,502 | 15,443 | 8.56% | ||
Non-owner occupied | 401,177 | 3,576 | 0.89% | ||
Owner occupied | 356,769 | 2,840 | 0.80% | ||
Farmland | 17,561 | 1,341 | 7.64% | ||
Total commercial real estate | 956,009 | 23,200 | 2.43% | ||
Consumer | 28,545 | -- | 0.00% | ||
Residential real estate: | |||||
Residential | 560,544 | 13,941 | 1.69% | ||
Multi-family | 103,642 | 303 | 0.29% | ||
Home equity lines | 264,944 | 1,213 | 0.46% | ||
Total residential | 929,130 | 15,457 | 1.66% | ||
All other loans | 8,078 | 26 | N/A | ||
Total loans | $ 2,098,896 | $ 42,960 | 2.05% |
QUARTERLY PERFORMANCE SUMMARY (UNAUDITED) | |||
STELLARONE CORPORATION (Nasdaq:STEL) | |||
(Dollars in thousands, except per share data) | |||
SELECTED BALANCE SHEET DATA | 12/31/2010 | 12/31/2009 | Percent Increase (Decrease) |
Assets | |||
Cash and cash equivalents | $ 139,886 | $ 152,926 | -8.53% |
Securities: | |||
Securities available for sale | 381,231 | 378,514 | 0.72% |
Securities held to maturity | -- | 447 | -100.00% |
Total securities | 381,231 | 378,961 | 0.60% |
Mortgage loans held for sale | 51,722 | 44,165 | 17.11% |
Loans: | |||
Real estate - construction | 255,198 | 296,489 | -13.93% |
Real estate - 1-4 family residential | 768,353 | 785,385 | -2.17% |
Real estate - commercial and multifamily | 861,588 | 845,561 | 1.90% |
Commercial, financial and agricultural | 177,134 | 211,903 | -16.41% |
Consumer loans | 28,545 | 39,173 | -27.13% |
All other loans | 8,078 | 7,027 | 14.96% |
Total loans | 2,098,896 | 2,185,538 | -3.96% |
Deferred loan costs | 588 | 969 | -39.32% |
Allowance for loan losses | (37,649) | (40,172) | -6.28% |
Net loans | 2,061,835 | 2,146,335 | -3.94% |
Premises and equipment, net | 79,033 | 83,546 | -5.40% |
Core deposit intangibles, net | 6,662 | 8,408 | -20.77% |
Goodwill | 113,652 | 113,652 | 0.00% |
Bank owned life insurance | 31,116 | 30,196 | 3.05% |
Foreclosed assets | 10,894 | 4,505 | 141.82% |
Other assets | 64,411 | 70,407 | -8.52% |
Total assets | 2,940,442 | 3,033,101 | -3.05% |
Liabilities | |||
Deposits: | |||
Noninterest bearing deposits | 322,924 | 302,009 | 6.93% |
Money market & interest checking | 989,426 | 961,857 | 2.87% |
Savings | 255,215 | 197,763 | 29.05% |
CD's and other time deposits | 818,537 | 974,491 | -16.00% |
Total deposits | 2,386,102 | 2,436,120 | -2.05% |
Federal funds purchased and securities sold under agreements to repurchase | 987 | 783 | 26.05% |
Federal Home Loan Bank advances | 85,000 | 130,000 | -34.62% |
Subordinated debt | 32,991 | 32,991 | 0.00% |
Other liabilities | 8,925 | 12,422 | -28.15% |
Total liabilities | 2,514,005 | 2,612,316 | -3.76% |
Stockholders' equity | |||
Preferred stock | 28,763 | 28,398 | 1.29% |
Common stock | 22,748 | 22,661 | 0.38% |
Additional paid-in capital | 270,047 | 268,965 | 0.40% |
Retained earnings | 101,188 | 96,947 | 4.37% |
Accumulated other comprehensive income, net | 3,691 | 3,814 | -3.22% |
Total stockholders' equity | 426,437 | 420,785 | 1.34% |
Total liabilities and stockholders' equity | $ 2,940,442 | $ 3,033,101 | -3.05% |
QUARTERLY PERFORMANCE SUMMARY (UNAUDITED) | |||
STELLARONE CORPORATION (Nasdaq:STEL) | |||
(Dollars in thousands) | |||
Percent | |||
For the Three Months Ended | Increase | ||
12/31/2010 | 12/31/2009 | (Decrease) | |
Interest Income | |||
Loans, including fees | $ 28,666 | $ 30,697 | -6.62% |
Federal funds sold and deposits in other banks | 58 | 51 | 13.73% |
Investment securities: | |||
Taxable | 1,844 | 2,228 | -17.24% |
Tax-exempt | 1,142 | 1,075 | 6.23% |
Dividends | -- | 48 | -100.00% |
Total interest income | 31,710 | 34,099 | -7.01% |
Interest Expense | |||
Deposits | 5,990 | 9,615 | -37.70% |
Federal funds purchased and securities sold under agreements to repurchase | 8 | 5 | 60.00% |
Federal Home Loan Bank advances and other borrowings | 687 | 1,315 | -47.76% |
Subordinated debt | 265 | 265 | 0.00% |
Total interest expense | 6,950 | 11,200 | -37.95% |
Net interest income | 24,760 | 22,899 | 8.13% |
Provision for loan losses | 5,300 | 3,500 | 51.43% |
Net interest income after provision for loan losses | 19,460 | 19,399 | 0.31% |
Noninterest Income | |||
Retail banking fees | 3,899 | 4,214 | -7.48% |
Commissions and fees from fiduciary activities | 768 | 722 | 6.37% |
Brokerage fee income | 389 | 336 | 15.77% |
Mortgage banking-related fees | 2,769 | 2,007 | 37.97% |
Losses on mortgage indemnifications and repurchases | (854) | (867) | -1.50% |
Gains on sale of premises and equipment | 172 | 30 | >100% |
Impairments of securities available for sale | (58) | (655) | -91.15% |
Gains on securities available for sale | 612 | 1 | >100% |
Losses / impairments on foreclosed assets | (688) | (1,013) | -32.08% |
Income from bank owned life insurance | 324 | 330 | -1.82% |
Other operating income | 494 | 346 | 42.77% |
Total noninterest income | 7,827 | 5,451 | 43.59% |
Noninterest Expense | |||
Compensation and employee benefits | 11,803 | 12,175 | -3.06% |
Net occupancy | 2,170 | 2,203 | -1.50% |
Supplies and equipment | 2,106 | 2,261 | -6.86% |
Amortization-intangible assets | 413 | 425 | -2.82% |
Marketing | 360 | 362 | -0.55% |
State franchise taxes | 554 | 574 | -3.48% |
FDIC insurance | 1,470 | 957 | 53.61% |
Data processing | 657 | 573 | 14.66% |
Professional fees | 530 | 1,254 | -57.74% |
Telecommunications | 430 | 461 | -6.72% |
Other operating expenses | 3,463 | 3,533 | -1.98% |
Total noninterest expense | 23,956 | 24,778 | -3.32% |
Income before income taxes | 3,331 | 72 | >100% |
Income tax expense (benefit) | 502 | (474) | >100% |
Net income | $ 2,829 | $ 546 | >100% |
QUARTERLY PERFORMANCE SUMMARY (UNAUDITED) | |||
STELLARONE CORPORATION (Nasdaq:STEL) | |||
(Dollars in thousands) | |||
Percent | |||
For the Twelve Months Ended | Increase | ||
12/31/2010 | 12/31/2009 | (Decrease) | |
Interest Income | |||
Loans, including fees | $ 114,828 | $ 125,837 | -8.75% |
Federal funds sold and deposits in other banks | 251 | 209 | 20.10% |
Investment securities: | |||
Taxable | 8,408 | 9,491 | -11.41% |
Tax-exempt | 4,368 | 4,008 | 8.98% |
Dividends | 67 | 164 | -59.15% |
Total interest income | 127,922 | 139,709 | -8.44% |
Interest Expense | |||
Deposits | 28,943 | 43,483 | -33.44% |
Federal funds purchased and securities sold under agreements to repurchase | 29 | 16 | 81.25% |
Federal Home Loan Bank advances and other borrowings | 3,866 | 5,756 | -32.84% |
Subordinated debt | 1,074 | 1,257 | -14.56% |
Total interest expense | 33,912 | 50,512 | -32.86% |
Net interest income | 94,010 | 89,197 | 5.40% |
Provision for loan losses | 22,850 | 37,800 | -39.55% |
Net interest income after provision for loan losses | 71,160 | 51,397 | 38.45% |
Noninterest Income | |||
Retail banking fees | 16,237 | 16,367 | -0.79% |
Commissions and fees from fiduciary activities | 3,264 | 2,960 | 10.27% |
Brokerage fee income | 1,492 | 1,203 | 24.02% |
Mortgage banking-related fees | 9,388 | 7,382 | 27.17% |
Losses on mortgage indemnifications and repurchases | (2,265) | (1,098) | >100% |
Gain on sale of financial center | 748 | -- | >100% |
Gains (losses) on sale of premises and equipment | 199 | (76) | >100% |
Impairments of securities available for sale | (110) | (2,525) | -95.64% |
Gains on securities available for sale | 1,268 | 45 | >100% |
Losses / impairments on foreclosed assets | (1,147) | (1,810) | -36.63% |
Income from bank owned life insurance | 1,296 | 1,292 | 0.31% |
Other operating income | 2,899 | 2,400 | 20.79% |
Total noninterest income | 33,269 | 26,140 | 27.27% |
Noninterest Expense | |||
Compensation and employee benefits | 45,898 | 44,564 | 2.99% |
Net occupancy | 8,389 | 8,578 | -2.20% |
Supplies and equipment | 8,401 | 8,735 | -3.82% |
Amortization-intangible assets | 1,651 | 1,730 | -4.57% |
Marketing | 1,146 | 1,276 | -10.19% |
State franchise taxes | 2,216 | 2,318 | -4.40% |
FDIC insurance | 5,518 | 5,309 | 3.94% |
Data processing | 2,398 | 2,466 | -2.76% |
Professional fees | 2,600 | 2,856 | -8.96% |
Telecommunications | 1,686 | 1,857 | -9.21% |
Other operating expenses | 13,056 | 13,972 | -6.56% |
Total noninterest expense | 92,959 | 93,661 | -0.75% |
Income (loss) before income taxes | 11,470 | (16,124) | >100% |
Income tax expense (benefit) | 1,705 | (7,594) | >100% |
Net income (loss) | $ 9,765 | $ (8,530) | >100% |
STELLARONE CORPORATION (Nasdaq:STEL) | ||||||
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES (UNAUDITED) | ||||||
THREE MONTHS ENDED DECEMBER 31, 2010 AND 2009 | ||||||
(Dollars in thousands) | ||||||
For the Three Months Ended December 31, | ||||||
2010 | 2009 | |||||
Dollars in thousands | Average Balance | Interest Inc/Exp | Average Rates | Average Balance | Interest Inc/Exp | Average Rates |
Assets | ||||||
Loans receivable, net (1) | $ 2,129,457 | $ 28,714 | 5.35% | $ 2,246,934 | $ 30,759 | 5.43% |
Investment securities | ||||||
Taxable | 249,848 | 1,844 | 2.89% | 241,856 | 2,276 | 3.68% |
Tax exempt (1) | 117,231 | 1,757 | 5.86% | 108,315 | 1,654 | 5.98% |
Total investments | 367,079 | 3,601 | 3.84% | 350,171 | 3,930 | 4.39% |
Interest bearing deposits | 53,739 | 29 | 0.21% | 44,411 | 14 | 0.12% |
Federal funds sold | 54,088 | 29 | 0.21% | 66,407 | 37 | 0.22% |
474,906 | 3,659 | 3.02% | 460,989 | 3,981 | 3.38% | |
Total earning assets | 2,604,363 | $ 32,373 | 4.93% | 2,707,923 | $ 34,740 | 5.09% |
Total nonearning assets | 341,651 | 321,562 | ||||
Total assets | $ 2,946,014 | $ 3,029,485 | ||||
Liabilities and Stockholders' Equity | ||||||
Interest-bearing deposits | ||||||
Interest checking | $ 552,735 | $ 546 | 0.39% | $ 549,036 | $ 1,315 | 0.95% |
Money market | 419,603 | 1,048 | 0.99% | 348,225 | 1,331 | 1.52% |
Savings | 248,643 | 471 | 0.75% | 197,889 | 448 | 0.90% |
Time deposits: | ||||||
Less than $100,000 | 567,053 | 2,508 | 1.75% | 673,076 | 4,228 | 2.49% |
$100,000 and more | 275,483 | 1,417 | 2.04% | 331,951 | 2,293 | 2.74% |
Total interest-bearing deposits | 2,063,517 | 5,990 | 1.15% | 2,100,177 | 9,615 | 1.82% |
Federal funds purchased and securities sold under agreements to repurchase | 1,026 | 8 | 3.05% | 637 | 5 | 3.18% |
Federal Home Loan Bank advances and other borrowings | 85,001 | 687 | 3.16% | 144,837 | 1,315 | 3.55% |
Subordinated debt | 32,991 | 265 | 3.14% | 32,991 | 265 | 3.14% |
119,018 | 960 | 3.16% | 178,465 | 1,585 | 3.48% | |
Total interest-bearing liabilities | 2,182,535 | 6,950 | 1.26% | 2,278,642 | 11,200 | 1.95% |
Total noninterest-bearing liabilities | 335,001 | 328,055 | ||||
Total liabilities | 2,517,536 | 2,606,697 | ||||
Stockholders' equity | 428,478 | 422,788 | ||||
Total liabilities and stockholders' equity | $ 2,946,014 | $ 3,029,485 | ||||
Net interest income (tax equivalent) | $ 25,423 | $ 23,540 | ||||
Average interest rate spread | 3.67% | 3.14% | ||||
Interest expense as percentage of average earning assets | 1.06% | 1.64% | ||||
Net interest margin | 3.87% | 3.45% | ||||
(1) Income and yields are reported on a taxable equivalent basis using a 35% tax rate. |
STELLARONE CORPORATION (Nasdaq:STEL) | ||||||
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES (UNAUDITED) | ||||||
TWELVE MONTHS ENDED DECEMBER 31, 2010 AND 2009 | ||||||
(Dollars in thousands) | ||||||
For the Twelve Months Ended December 31, | ||||||
2010 | 2009 | |||||
Dollars in thousands | Average Balance | Interest Inc/Exp | Average Rates | Average Balance | Interest Inc/Exp | Average Rates |
Assets | ||||||
Loans receivable, net (1) | $ 2,161,387 | $ 115,025 | 5.32% | $ 2,270,754 | $ 126,214 | 5.56% |
Investment securities | ||||||
Taxable | 264,632 | 8,475 | 3.16% | 233,375 | 9,655 | 4.08% |
Tax exempt (1) | 111,296 | 6,720 | 5.96% | 100,362 | 6,165 | 6.06% |
Total investments | 375,928 | 15,195 | 3.99% | 333,737 | 15,820 | 4.68% |
Interest bearing deposits | 55,101 | 124 | 0.22% | 50,066 | 94 | 0.19% |
Federal funds sold | 52,001 | 127 | 0.24% | 53,157 | 115 | 0.21% |
483,030 | 15,446 | 3.16% | 436,960 | 16,029 | 3.62% | |
Total earning assets | 2,644,417 | $ 130,471 | 4.93% | 2,707,714 | $ 142,243 | 5.25% |
Total nonearning assets | 332,327 | 323,923 | ||||
Total assets | $ 2,976,744 | $ 3,031,637 | ||||
Liabilities and Stockholders' Equity | ||||||
Interest-bearing deposits | ||||||
Interest checking | $ 560,591 | $ 3,363 | 0.60% | $ 531,627 | $ 5,243 | 0.99% |
Money market | 400,210 | 4,579 | 1.14% | 293,211 | 4,407 | 1.50% |
Savings | 227,197 | 1,844 | 0.81% | 193,127 | 1,709 | 0.88% |
Time deposits: | ||||||
Less than $100,000 | 604,831 | 12,394 | 2.05% | 735,645 | 21,540 | 2.93% |
$100,000 and more | 290,421 | 6,763 | 2.33% | 330,277 | 10,714 | 3.24% |
Total interest-bearing deposits | 2,083,250 | 28,943 | 1.39% | 2,083,887 | 43,613 | 2.09% |
Federal funds purchased and securities sold under agreements to repurchase | 982 | 29 | 2.91% | 501 | 16 | 3.15% |
Federal Home Loan Bank advances and other borrowings | 113,315 | 3,866 | 3.36% | 160,904 | 5,756 | 3.53% |
Subordinated debt | 32,991 | 1,074 | 3.21% | 32,991 | 1,257 | 3.76% |
147,288 | 4,969 | 3.33% | 194,396 | 7,029 | 3.57% | |
Total interest-bearing liabilities | 2,230,538 | 33,912 | 1.52% | 2,278,283 | 50,642 | 2.22% |
Total noninterest-bearing liabilities | 320,568 | 324,981 | ||||
Total liabilities | 2,551,106 | 2,603,264 | ||||
Stockholders' equity | 425,638 | 428,373 | ||||
Total liabilities and stockholders' equity | $ 2,976,744 | $ 3,031,637 | ||||
Net interest income (tax equivalent) | $ 96,559 | $ 91,601 | ||||
Average interest rate spread | 3.42% | 3.04% | ||||
Interest expense as percentage of average earning assets | 1.28% | 1.87% | ||||
Net interest margin | 3.65% | 3.38% | ||||
(1) Income and yields are reported on a taxable equivalent basis using a 35% tax rate. |
STELLARONE CORPORATION (Nasdaq:STEL) | ||||
FINANCIAL INFORMATION - FOUR QUARTER TREND (UNAUDITED) | ||||
(Dollars in thousands, except per share data) | ||||
Quarter Ended | ||||
December 31, 2010 | September 30, 2010 | June 30, 2010 | March 31, 2010 | |
Interest income | 31,710 | 31,582 | 32,150 | 32,481 |
Interest expense | 6,950 | 8,048 | 8,932 | 9,982 |
Net interest income | 24,760 | 23,534 | 23,218 | 22,499 |
Provision for loan losses | 5,300 | 3,500 | 7,350 | 6,700 |
Total net interest income after provision | 19,460 | 20,034 | 15,868 | 15,799 |
Non interest income | 7,827 | 8,247 | 8,380 | 8,814 |
Non interest expense | 23,956 | 23,665 | 22,791 | 22,547 |
Income before income taxes | 3,331 | 4,616 | 1,457 | 2,066 |
Income tax (benefit) expense | 502 | 1,088 | (96) | 212 |
Net income | 2,829 | 3,528 | 1,553 | 1,854 |
Preferred stock dividends | (378) | (378) | (374) | (370) |
Accretion of preferred stock discount | (94) | (92) | (91) | (88) |
Net income available to common shareholders | 2,357 | 3,058 | 1,088 | 1,396 |
Net income per share | ||||
basic | 0.10 | 0.13 | 0.05 | 0.06 |
diluted | 0.10 | 0.13 | 0.05 | 0.06 |
STELLARONE CORPORATION (Nasdaq:STEL) | ||||||
SEGMENT INFORMATION (UNAUDITED) | ||||||
(Dollars in thousands) | ||||||
At and for the Three Months Ended December 31, 2010 (In thousands): | ||||||
Commercial Bank | Mortgage Banking | Wealth Management | Other | Intersegment Elimination | Consolidated | |
Net interest income | $ 24,525 | $ 500 | $ -- | $ (265) | $ -- | $ 24,760 |
Provision for loan losses | 5,300 | -- | -- | -- | -- | 5,300 |
Noninterest income | 5,832 | 1,832 | 1,157 | 82 | (1,076) | 7,827 |
Noninterest expense | 21,195 | 2,226 | 1,030 | 581 | (1,076) | 23,955 |
Provision for income taxes | 713 | 32 | 38 | (280) | -- | 502 |
Net income (loss) | $ 3,149 | $ 73 | $ 90 | $ (483) | $ -- | $ 2,829 |
Total Assets | $ 2,870,097 | $ 52,788 | $ 473 | $ 462,991 | $ (445,907) | $ 2,940,442 |
Average Assets | $ 2,877,873 | $ 52,439 | $ 181 | $ 465,865 | $ (450,344) | $ 2,946,014 |
At and for the Three Months Ended December 31, 2009 (In thousands): | ||||||
Commercial Bank | Mortgage Banking | Wealth Management | Other | Intersegment Elimination | Consolidated | |
Net interest income | $ 22,620 | $ 543 | $ -- | $ (265) | $ -- | $ 22,899 |
Provision for loan losses | 3,500 | -- | -- | -- | -- | 3,500 |
Noninterest income | 4,685 | 1,096 | 1,058 | (338) | (1,051) | 5,451 |
Noninterest expense | 22,722 | 1,717 | 993 | 396 | (1,051) | 24,778 |
Provision for income taxes | (105) | (23) | 19 | (364) | -- | (474) |
Net income (loss) | $ 1,188 | $ (54) | $ 46 | $ (634) | $ -- | $ 546 |
Total Assets | $ 2,967,537 | $ 47,140 | $ 610 | $ 457,860 | $ (440,045) | $ 3,033,101 |
Average Assets | $ 2,960,909 | $ 49,164 | $ 439 | $ 420,710 | $ (401,737) | $ 3,029,485 |
At and for the Twelve Months Ended December 31, 2010 (In thousands): | ||||||
Commercial Bank | Mortgage Banking | Wealth Management | Other | Intersegment Elimination | Consolidated | |
Net interest income | $ 93,535 | $ 1,549 | $ -- | $ (1,074) | $ -- | $ 94,010 |
Provision for loan losses | 22,850 | -- | -- | -- | -- | 22,850 |
Noninterest income | 24,976 | 7,101 | 4,757 | 720 | (4,285) | 33,269 |
Noninterest expense | 83,442 | 7,695 | 3,975 | 2,132 | (4,285) | 92,959 |
Provision for income taxes | 2,130 | 286 | 234 | (945) | -- | 1,705 |
Net income (loss) | $ 10,089 | $ 669 | $ 547 | $ (1,540) | $ -- | $ 9,765 |
Average Assets | $ 2,919,816 | $ 39,790 | $ 174 | $ 462,758 | $ (445,794) | $ 2,976,744 |
At and for the Twelve Months Ended December 31, 2009 (In thousands): | ||||||
Commercial Bank | Mortgage Banking | Wealth Management | Other | Intersegment Elimination | Consolidated | |
Net interest income | $ 88,665 | $ 1,784 | $ -- | $ (1,252) | $ -- | $ 89,197 |
Provision for loan losses | 37,800 | -- | -- | -- | -- | 37,800 |
Noninterest income | 21,569 | 6,240 | 4,162 | (1,629) | (4,203) | 26,140 |
Noninterest expense | 85,949 | 6,417 | 3,770 | 1,728 | (4,203) | 93,661 |
Provision for income taxes | (6,505) | 482 | 118 | (1,689) | -- | (7,594) |
Net income (loss) | $ (7,012) | $ 1,126 | $ 275 | $ (2,919) | $ -- | $ (8,530) |
Average Assets | $ 2,968,455 | $ 41,850 | $ 467 | $ 426,444 | $ (405,580) | $ 3,031,637 |
CONTACT: Jeffrey W. Farrar, Executive Vice President and CFO (434) 964-2217 jfarrar@stellarone.com