PEOPLES BANCORP INC. – P.O. BOX 738 - MARIETTA, OHIO – 45750
www.peoplesbancorp.com
NEWS RELEASE
FOR IMMEDIATE RELEASE | Contact: | Edward G. Sloane |
July 29, 2008 | Chief Financial Officer and Treasurer | |
(740) 373-3155 |
PEOPLES BANCORP INC. ANNOUNCES
SECOND QUARTER EARNINGS
_____________________________________________________________________
MARIETTA, Ohio - Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) today announced second quarter 2008 net income of $2.0 million, or $0.19 per diluted share, compared to $5.3 million, or $0.51 per diluted share, for the second quarter of 2007. On a year-to-date basis, net income totaled $7.6 million and diluted earnings per share were $0.73, versus $11.0 million and $1.04, respectively, for the same period in 2007.
Peoples’ second quarter 2008 earnings included $4.5 million of additional provision for loan losses ($2.9 million or $0.28 per diluted share after-tax) related to a single $12.6 million commercial real estate loan identified as impaired in connection with management’s quarterly analysis of the allowance for loan losses for the second quarter. Management determined that the value of the collateral, which is located in west central Florida, had decreased substantially, causing the loan to be under–collateralized. Accordingly, this loan was placed on non-accrual status and charged down to the estimated realizable fair value of the collateral of $6.5 million, less estimated costs to sell of $0.3 million, at June 30, 2008.
“Although out-of-market loans are not a big part of our portfolio, our second quarter results, like those of many other financial companies, were impacted by sluggish economic conditions and the deteriorating housing market, specifically in Florida,” said Mark F. Bradley, President and Chief Executive Officer. “Our remaining exposure to Florida real estate is less than $3 million and these unrelated loan relationships are performing in accordance with their original terms. While nonperforming assets and the loan loss provision have increased, our capital levels remain well above the amounts needed to be considered well-capitalized and serve as a source of strength as we work through the isolated issues in the loan portfolio.”
Bradley continued, “Despite lower earnings, we still achieved success in key areas, including deposit growth, increased net interest income, net interest margin expansion and lower operating expenses which led to improved operating efficiency. We will continue to work through the recent loan challenges while focusing on strategies for long-term revenue growth, with an eye on efficiency in these challenging economic times.”
During the second quarter of 2008, Peoples sold preferred stocks issued by the Federal National Mortgage Association (“FNMA”) and the Federal Home Loan Mortgage Corporation (“FHLMC”) with a recorded value of $2.7 million, at a net pre-tax loss of $191,000, which was partially offset by a $138,000 pre-tax gain from the sale of mortgage-backed securities with a recorded value of $18.7 million. These securities were sold as part of the ongoing management of Peoples’ credit and interest rate risk exposures in its investment portfolio. At June 30, 2008, Peoples held in its investment portfolio FNMA preferred stocks with a market value of $1.9 million, resulting in a $260,000 other-than-temporary impairment charge in the second quarter of 2008. In July, Peoples sold these remaining preferred stocks, which completely eliminated all holding of preferred stocks issued by FNMA and FHLMC. As a result of the July sales, Peoples will recognize a pre-tax loss of $594,000 ($386,000 after-tax) in the third quarter of 2008.
For the quarter ended June 30, 2008, net interest income was $14.9 million, up 12% over the prior year second quarter, with the net interest margin expanding 30 basis points to 3.61%. On a linked quarter basis, net interest income increased 4% and net interest margin expanded 10 basis points. Through six months of 2008, net interest income has grown 9% compared to the same period last year and net interest margin was 3.56% versus 3.32%. These improvements were largely attributable to the reduction in short-term market rates and widening of credit spreads, as well as Peoples’ growth of lower cost retail deposits. As a result, Peoples’ second quarter cost of funds dropped 38 basis points to 3.13%, from 3.52% for the linked quarter and fell 88 basis points compared to the second quarter of 2007, while asset yields declined 25 and 50 basis points over the same periods, respectively. On a year-to-date basis, the average cost of funds decreased 69 basis points and the average yield on assets was down 39 basis points.
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Second Quarter 2008 Earnings Release
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Second quarter 2008 net interest income and margin included $226,000 additional income, or five basis points, from the net impact of loan prepayment fees and reduction in interest income for non-accrual loans. In comparison, second quarter 2007 net interest income and margin were reduced by $309,000 or seven basis points due to loan and investment interest reductions. The net impact in first quarter 2008 was additional income of $126,000, or three additional basis points of net interest margin.
“Second quarter net interest income and margin exceeded expectations, as asset yields dropped less than anticipated due to wider credit spreads,” said Edward G. Sloane, Chief Financial Officer and Treasurer. “While the lower cost of funds negated the drop in asset yields thus far in 2008, we expect net interest margin to be pressured in the near term by assets repricing downward and limited additional opportunities to lower funding costs. Given the uncertainty regarding the timing and magnitude of future interest rate changes, we continue to focus on positioning our balance sheet to optimize Peoples’ net interest income stream, while also minimizing the impact of future rate changes on our earnings.”
Non-interest income was at a consistent level compared to the prior year, totaling $7.9 million and $16.1 million for the three and six months ended June 30, 2008, respectively, as higher trust and investment income and electronic banking revenues were offset by lower insurance commissions and deposit account service charges. On a linked-quarter basis, non-interest income was down 4% in the second quarter of 2008, due to the recognition of annual performance-based insurance commissions in the first quarter. Excluding the impact of this seasonal fluctuation, non-interest income grew 6% in comparison to the first quarter of 2008.
Peoples’ trust and investment revenues experienced 9% growth year-over-year for both the second quarter and on a year-to-date basis, attributable to increased assets under management from new business, which more than offset the decline in asset values caused by the recent downturn in the financial markets. At June 30, 2008, total managed assets were $987.6 million, up 1% compared to a year ago. Increases in debit card activity have produced double-digit growth in electronic banking revenues, with second quarter 2008 revenues up 13% versus a year ago and 10% from the first quarter of 2008. Insurance sales commissions (excluding performance-based commissions) were up 5% from the linked quarter, despite a softer insurance market that is producing tighter pricing margins within the insurance industry.
Total non-interest expense was $13.0 million for the three months ended June 30, 2008, down 1% from the same period a year ago, due mostly to a modest decrease in professional fees. Second quarter 2008 salary and benefit costs, Peoples’ largest non-interest expense, were comparable to last year’s amount, as higher sales-based compensation and increased base salaries from annual merit adjustments were offset by lower incentive expense tied to corporate results. Compared to the first quarter of 2008, total non-interest expense decreased 5% in the second quarter, due to lower incentive and stock-based compensation expenses and reduced professional fees. Through six months of 2008, non-interest expense totaled $26.8 million versus $26.5 million for the first half of 2007, with the increase largely the result of higher sales-based compensation expense and employee medical benefit costs.
“Operating expenses are in line with expectations, while total non-interest income levels were relatively flat,” said Sloane. “We improved our efficiency ratio in the first half of 2008 by expanding net interest margin and controlling operating costs.”
At June 30, 2008, portfolio loan balances were down $10.9 million for the quarter and $16.1 million since year-end 2007, totaling $1.10 billion. These declines were due to commercial loan payoffs outpacing new production, coupled with the charge-down of the previously-mentioned impaired commercial loan. Peoples’ serviced real estate loan portfolio continues to increase steadily, reaching $182.3 million at June 30, 2008, versus $176.7 million at December 31, 2007.
In the second quarter of 2008, the provision for loan losses was $6.8 million compared to $1.4 million last quarter and $0.8 million in the second quarter of 2007. On a year-to-date basis, Peoples’ provision for loan losses totaled $8.2 million versus $1.5 million a year ago. The provision for loan losses continues to be based on management’s quarterly evaluation of the loan portfolio and is directionally consistent with changes in Peoples’ overall loan quality.
Non-performing loans totaled $21.2 million, or 1.92% of total loans, up from $17.5 million, or 1.57%, at March 31, 2008, and $9.4 million, or 0.83% at December 31, 2007. The increased amount of non-performing loans during the first half of 2008 was due to the previously-mentioned impaired loan being placed on non-accrual status during the second quarter and a $7.0 million, unrelated commercial loan being placed on non-accrual status during the first quarter of 2008. No specific reserves were made for these loans at June 30, 2008, since they have been charged down to the estimated realizable fair value of the underlying collateral. As a result, the allowance for loan losses was $15.2 million, or 71.8% of non-performing loans, versus $16.0 million, or 91.2%, at March 31, 2008, and $15.7 million, or 168.0%, at year-end 2007. Management believes the allowance for loan losses was adequate at June 30, 2008, based on all information currently available.
Second quarter of 2008 net loan charge-offs were $7.5 million compared to $1.2 million last quarter and $0.7 million for the second quarter of 2007, with the increase due to the $6.4 million charge-down on the impaired commercial loan. Through six months of 2008, net loan charge-offs totaled $8.7 million versus $1.3 million a year ago. A portion of the change was attributable to a recovery that occurred during the first quarter of 2007 on a group of commercial loans charged-off in 2002, which reduced first quarter 2007 net charge-offs by $609,000.
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Second Quarter 2008 Earnings Release
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“We believe the nature of the increase in non-performing loans in the current credit environment is manageable because of our limited out-of-market lending activities and sound underwriting practices,” said Sloane. “The two large commercial loans placed on non-accrual status in 2008 were appropriately considered in establishing the level of allowance for loan losses at June 30, 2008 and in prior periods. We will continue to monitor and evaluate these two relationships closely through our review process.”
Peoples’ total out-of-market loans comprised $108.2 million at June 30, 2008, or approximately 10% of total outstanding loan balances, with $68.8 million of these loans located in Ohio, West Virginia and Kentucky. Of the remaining $39.4 million of loans, the largest concentrations are in Arizona and Florida, with outstanding balances of $10.1 million and $8.5 million, respectively at June 30, 2008. In all other states, the aggregate outstanding balance in the state was less than $5 million at June 30, 2008. Except for the previously-mentioned impaired loan, these loans are performing in accordance with their original terms.
Retail deposit balances, which exclude brokered deposits, grew $32.0 million during the second quarter of 2008, attributable to higher money market and non-interest-bearing balances. For the quarter, money market balances grew $15.8 million, due to Peoples offering more competitive rates. Retail certificates of deposit and savings balances increased $8.0 million and $2.1 million, respectively, while interest-bearing demand deposits fell $9.6 million, due in part to seasonal changes in governmental deposit balances. Non-interest-bearing deposits grew $15.8 million during the second quarter of 2008, due almost entirely to higher commercial balances at June 30, 2008. Since year-end 2007, total retail balances have increased $114.5 million, or 10%, due mostly to higher interest-bearing retail balances from Peoples attracting approximately $60 million of funds from customers outside its primary market area instead of using higher-costing brokered deposits. The retail deposit growth during 2008 has allowed Peoples to reduce higher rate brokered certificates of deposit balances by $19.8 million and contributed to the $71.2 million, or 15%, overall reduction in borrowed funds since year-end 2007.
In the second quarter of 2008, Peoples increased its dividend 4.5% to $0.23 per share, from the $0.22 per share declared for both the first quarter of 2008 and second quarter of 2007. Through six months of 2008, Peoples’ dividend payout ratio was 61.5% of net income versus 42.3% for the same period last year.
Peoples Bancorp Inc. is a diversified financial products and services company with $1.9 billion in assets, 50 locations and 38 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank); and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
Conference Call to Discuss Earnings:
Peoples will conduct a facilitated conference call to discuss second quarter 2008 results of operations today at 11:00 a.m. Eastern Daylight Time, with members of Peoples’ executive management participating. Analysts, media and individual investors are invited to participate in the conference call by calling (800) 860-2442. A simultaneous Webcast of the conference call audio will be available online via the “Investor Relations” section of Peoples’ website, www.peoplesbancorp.com. Participants are encouraged to call or sign in at least 15 minutes prior to the scheduled conference call time to ensure participation and, if required, to download and install the necessary software. A replay of the call will be available on Peoples’ website in the “Investor Relations” section for one year.
Safe Harbor Statement:
This news release may contain certain forward-looking statements with respect to Peoples’ financial condition, results of operations, plans, objectives, future performance and business. Except for the historical and present factual information contained in this news release, the matters discussed in this news release, and other statements identified by words such as “feel,” “expect,” “believe,” “plan,” “will,” “would,” “should,” “could” and similar expressions are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially. Factors that might cause such a difference include, but are not limited to: (1) deterioration in the credit quality of Peoples’ loan portfolio could occur due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than otherwise assumed and assumed cash flows may be worse
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Second Quarter 2008 Earnings Release
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than expected, which may adversely impact the provision for loan losses; (2) competitive pressures among financial institutions or from non-financial institutions, which may increase significantly; (3) changes in the interest rate environment, which may adversely impact interest margins; (4) changes in prepayment speeds, loan originations, sale volumes, and charge-offs, which may be less favorable than expected and adversely impact the amount of interest income generated; (5) general economic conditions, either national or in the states in which Peoples and its subsidiaries do business, which may be less favorable than expected; (6) political developments, wars or other hostilities, which may disrupt or increase volatility in securities markets or other economic conditions; (7) legislative or regulatory changes or actions, which may adversely affect the business of Peoples and its subsidiaries; (8) adverse changes in the conditions and trends in the financial markets, which may adversely affect the fair value of securities within Peoples’ investment portfolio; (9) a delayed or incomplete resolution of regulatory issues that could arise; (10) Peoples’ ability to receive dividends from its subsidiaries; (11) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity; (12) the costs and effects of regulatory and legal developments, including the outcome of regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; and (13) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (“SEC”), including those risk factors included in the disclosures under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2007. Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements. Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.
PEOPLES BANCORP INC. (NASDAQ: PEBO)
PER SHARE DATA AND PERFORMANCE RATIOS
Three Months Ended | Six Months Ended | ||||||||
June 30, | March 31, | June 30, | June 30, | ||||||
(in $000’s, except per share data) | 2008 | 2008 | 2007 | 2008 | 2007 | ||||
Net income per share: | |||||||||
Basic | $ 0.19 | $ 0.55 | $ 0.51 | $ 0.74 | $ 1.04 | ||||
Diluted | $ 0.19 | $ 0.55 | $ 0.51 | $ 0.73 | $ 1.04 | ||||
Cash dividends declared per share | $ 0.23 | $ 0.22 | $ 0.22 | $ 0.45 | $ 0.44 | ||||
Book value per share | $ 19.55 | $ 20.15 | $ 18.78 | $ 19.55 | $ 18.78 | ||||
Tangible book value per share (a) | $ 13.03 | $ 13.58 | $ 12.19 | $ 13.03 | $ 12.19 | ||||
Closing stock price at end of period | $ 18.98 | $ 24.11 | $ 27.07 | $ 18.98 | $ 27.07 | ||||
Dividend payout as a percentage of net income | 122.38% | 40.46% | 43.41% | 61.51% | 42.29% | ||||
Return on average equity (b) | 3.81% | 11.00% | 10.81% | 7.41% | 11.19% | ||||
Return on average assets (b) | 0.41% | 1.21% | 1.16% | 0.81% | 1.19% | ||||
Efficiency ratio (c) | 54.55% | 58.09% | 58.68% | 56.31% | 58.57% | ||||
Net interest margin (fully tax-equivalent) (b) | 3.61% | 3.51% | 3.31% | 3.56% | 3.32% |
(a) | Excludes the balance sheet impact of intangible assets acquired through acquisitions. |
(b) | Ratios are presented on an annualized basis. |
(c) | Non-interest expense (less intangible amortization) as a percentage of fully tax-equivalent net interest income plus non-interest income (less securities and asset disposal gains/losses) |
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Second Quarter 2008 Earnings Release
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PEOPLES BANCORP INC. CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended | Six Months Ended | ||||||
June 30, | June 30, | ||||||
(in $000’s) | 2008 | 2007 | 2008 | 2007 | |||
Interest income | $ 26,548 | $ 28,080 | $ 53,847 | $ 56,440 | |||
Interest expense | 11,674 | 14,747 | 24,687 | 29,586 | |||
Net interest income | 14,874 | 13,333 | 29,160 | 26,854 | |||
Provision for loan losses | 6,765 | 847 | 8,202 | 1,470 | |||
Net interest income after provision for loan losses | 8,109 | 12,486 | 20,958 | 25,384 | |||
Net (loss) gain on securities transactions | (308) | 21 | (15) | 38 | |||
Net gain on asset disposals | 3 | 34 | 3 | 34 | |||
Non-interest income: | |||||||
Deposit account service charges | 2,375 | 2,445 | 4,670 | 4,813 | |||
Insurance commissions | 2,225 | 2,409 | 5,155 | 5,359 | |||
Trust and investment income | 1,403 | 1,286 | 2,649 | 2,429 | |||
Electronic banking revenues | 1,013 | 900 | 1,931 | 1,728 | |||
Bank owned life insurance | 405 | 408 | 829 | 819 | |||
Mortgage banking income | 192 | 264 | 396 | 4710 | |||
Other | 270 | 208 | 487 | 415 | |||
Total non-interest income | 7,883 | 7,920 | 16,117 | 16,034 | |||
Non-interest expense: | |||||||
Salaries and benefits | 6,906 | 6,870 | 14,466 | 14,167 | |||
Net occupancy and equipment | 1,399 | 1,352 | 2,825 | 2,684 | |||
Data processing and software | 560 | 551 | 1,101 | 1,064 | |||
Electronic banking expense | 516 | 554 | 1,040 | 1,014 | |||
Professional fees | 456 | 631 | 1,066 | 1,245 | |||
Franchise taxes | 416 | 448 | 832 | 887 | |||
Amortization of intangible assets | 403 | 489 | 818 | 989 | |||
Marketing | 367 | 379 | 737 | 728 | |||
Other | 2,021 | 1,876 | 3,901 | 3,714 | |||
Total non-interest expense | 13,044 | 13,150 | 26,786 | 26,492 | |||
Income before income taxes | 2,643 | 7,311 | 10,277 | 14,998 | |||
Income tax expense | 690 | 1,962 | 2,676 | 4,003 | |||
Net income | $ 1,953 | $ 5,349 | $ 7,601 | $ 10,995 | |||
Net income per share: | |||||||
Basic | $ 0.19 | $ 0.51 | $ 0.74 | $ 1.04 | |||
Diluted | $ 0.19 | $ 0.51 | $ 0.73 | $ 1.04 | |||
Cash dividends declared per share | $ 0.23 | $ 0.22 | $ 0.45 | $ 0.44 | |||
Weighted average shares outstanding: | |||||||
Basic | 10,304,666 | 10,503,952 | 10,303,690 | 10,544,199 | |||
Diluted | 10,352,135 | 10,574,250 | 10,347,720 | 10,619,815 | |||
Actual shares outstanding (end of period) | 10,304,597 | 10,464,741 | 10,304,597 | 10,464,741 |
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Second Quarter 2008 Earnings Release
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PEOPLES BANCORP INC. CONSOLIDATED BALANCE SHEETS
June 30, | December 31, | ||
(in $000’s) | 2008 | 2007 | |
ASSETS | |||
Cash and cash equivalents: | |||
Cash and due from banks | $ 44,715 | $ 43,275 | |
Interest-bearing deposits in other banks | 1,801 | 1,925 | |
Total cash and cash equivalents | 46,516 | 45,200 | |
Available-for-sale investment securities, at fair value (amortized cost of $577,436 | |||
at June 30, 2008 and $535,979 at December 31, 2007) | 576,207 | 542,231 | |
Other investment securities, at cost | 23,735 | 23,232 | |
Total investment securities | 599,942 | 565,463 | |
Loans, net of unearned interest | 1,104,852 | 1,120,941 | |
Allowance for loan losses | (15,229) | (15,718) | |
Net loans | 1,089,623 | 1,105,223 | |
Loans held for sale | 471 | 1,994 | |
Bank premises and equipment, net of accumulated depreciation | 24,954 | 24,803 | |
Bank owned life insurance | 51,120 | 50,291 | |
Goodwill | 62,520 | 62,520 | |
Other intangible assets | 4,697 | 5,509 | |
Other assets | 27,038 | 24,550 | |
TOTAL ASSETS | $ 1,906,881 | $ 1,885,553 | |
LIABILITIES | |||
Non-interest-bearing deposits | $ 193,265 | $ 175,057 | |
Interest-bearing deposits | 1,087,783 | 1,011,320 | |
Total deposits | 1,281,048 | 1,186,377 | |
Federal funds purchased, securities sold under repurchase agreements, | |||
and other short-term borrowings | 129,370 | 222,541 | |
Long-term borrowings | 253,885 | 231,979 | |
Junior subordinated notes held by subsidiary trusts | 22,478 | 22,460 | |
Accrued expenses and other liabilities | 18,654 | 19,360 | |
TOTAL LIABILITIES | 1,705,435 | 1,682,717 | |
STOCKHOLDERS’ EQUITY | |||
Common stock, no par value (24,000,000 shares authorized, 10,946,025 shares | |||
issued at June 30, 2008, and 10,925,954 shares issued at December 31, 2007) | 164,190 | 163,399 | |
Retained earnings | 55,453 | 52,527 | |
Accumulated comprehensive (loss) income, net of deferred income taxes | (1,849) | 3,014 | |
Treasury stock, at cost (641,428 shares at June 30, 2008, and | |||
629,206 shares at December 31, 2007) | (16,348) | (16,104) | |
TOTAL STOCKHOLDERS’ EQUITY | 201,446 | 202,836 | |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 1,906,881 | $ 1,885,553 |
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Second Quarter 2008 Earnings Release
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PEOPLES BANCORP INC. SELECTED FINANCIAL INFORMATION
June 30, | March 31, | December 31, | September 30, | June 30, | |||||
(in $000’s, end of period) | 2008 | 2008 | 2007 | 2007 | 2007 | ||||
LOAN PORTFOLIO | |||||||||
Commercial, mortgage | $ 499,043 | $ 498,426 | $ 513,847 | $ 481,341 | $ 468,241 | ||||
Commercial, other | 186,346 | 180,523 | 171,937 | 174,753 | 177,651 | ||||
Real estate, construction | 53,170 | 72,326 | 71,794 | 83,714 | 96,690 | ||||
Real estate, mortgage | 234,870 | 237,366 | 237,641 | 240,599 | 243,080 | ||||
Home equity lines of credit | 44,595 | 43,101 | 42,706 | 43,506 | 43,118 | ||||
Consumer | 83,605 | 81,108 | 80,544 | 80,661 | 77,482 | ||||
Deposit account overdrafts | 3,223 | 2,879 | 2,472 | 2,047 | 2,147 | ||||
Total loans | 1,104,852 | 1,115,729 | 1,120,941 | 1,106,621 | 1,108,409 | ||||
DEPOSIT BALANCES | |||||||||
Interest-bearing deposits: | |||||||||
Retail certificates of deposit | $ 557,406 | $ 549,439 | $ 499,684 | $ 515,432 | $ 517,910 | ||||
Interest-bearing transaction accounts | 202,063 | 211,708 | 191,359 | 178,880 | 179,430 | ||||
Money market deposit accounts | 172,048 | 156,206 | 153,299 | 147,848 | 149,791 | ||||
Savings accounts | 116,485 | 114,433 | 107,389 | 112,507 | 115,691 | ||||
Brokered certificates of deposits | 39,781 | 39,756 | 59,589 | 57,507 | 66,601 | ||||
Total interest-bearing deposits | 1,087,783 | 1,071,542 | 1,011,320 | 1,012,174 | 1,029,423 | ||||
Non-interest-bearing deposits | 193,265 | 177,449 | 175,057 | 171,319 | 173,675 | ||||
Total deposits | 1,281,048 | 1,248,991 | 1,186,377 | 1,183,493 | 1,203,098 | ||||
ASSET QUALITY | |||||||||
Nonperforming assets: | |||||||||
Loans 90 days or more past due | $ 290 | $ 438 | $ 378 | $ 190 | $ 313 | ||||
Nonaccrual loans | 20,910 | 17,061 | 8,980 | 5,979 | 7,096 | ||||
Total nonperforming loans | 21,200 | 17,499 | 9,358 | 6,169 | 7,409 | ||||
Other real estate owned | 411 | 343 | 343 | 343 | 213 | ||||
Total nonperforming assets | $ 21,611 | $ 17,842 | $ 9,701 | $ 6,512 | $ 7,622 | ||||
Allowance for loan losses as a percent of | |||||||||
nonperforming loans | 71.8% | 91.2% | 168.0% | 237.3% | 198.3% | ||||
Nonperforming loans as a percent of total loans | 1.92% | 1.57% | 0.83% | 0.56% | 0.67% | ||||
Nonperforming assets as a percent of total assets | 1.13% | 0.94% | 0.51% | 0.34% | 0.41% | ||||
Nonperforming assets as a percent of total loans and | |||||||||
other real estate owned | 1.96% | 1.60% | 0.87% | 0.59% | 0.69% | ||||
Allowance for loan losses as a percent of total loans | 1.38% | 1.43% | 1.40% | 1.32% | 1.33% | ||||
REGULATORY CAPITAL (a) | |||||||||
Tier 1 risk-based capital | 12.10% | 12.12% | 11.91% | 11.82% | 11.74% | ||||
Total risk-based capital ratio (Tier 1 and Tier 2) | 13.33% | 13.43% | 13.23% | 13.04% | 12.97% | ||||
Leverage ratio | 8.72% | 8.81% | 8.48% | 8.67% | 8.67% | ||||
Tier 1 capital | $ 159,242 | $ 158,919 | $ 154,933 | $ 156,209 | $ 155,361 | ||||
Total capital (Tier 1 and Tier 2) | $ 175,397 | $ 176,083 | $ 172,117 | $ 172,263 | $ 171,592 | ||||
Total risk-weighted assets | $ 1,315,523 | $ 1,310,895 | $ 1,301,056 | $ 1,321,367 | $ 1,323,359 |
(a) June 30, 2008 data based on preliminary analysis and subject to revision.
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Second Quarter 2008 Earnings Release
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PEOPLES BANCORP INC. PROVISION FOR LOAN LOSSES INFORMATION
Three Months Ended | Six Months Ended | ||||||||
June 30, | March 31, | June 30, | June 30, | ||||||
(in $000’s) | 2008 | 2008 | 2007 | 2008 | 2007 | ||||
PROVISION FOR LOAN LOSSES | |||||||||
Provision for Overdraft Privilege losses | $ 160 | $ 37 | $ 136 | $ 197 | $ 159 | ||||
Provision for other loan losses | $ 6,605 | $ 1,400 | $ 711 | $ 8,005 | $ 1,311 | ||||
Total provision for loan losses | $ 6,765 | $ 1,437 | $ 847 | $ 8,202 | $ 1,470 | ||||
NET CHARGE-OFFS | |||||||||
Gross charge-offs | $ 7,720 | $ 1,638 | $ 965 | $ 9,358 | $ 2,610 | ||||
Recoveries | 231 | 436 | 297 | 667 | 1,323 | ||||
Net charge-offs | $ 7,489 | $ 1,202 | $ 668 | $ 8,691 | $ 1,287 | ||||
NET CHARGE-OFFS BY TYPE | |||||||||
Commercial | $ 6,900 | $ 862 | $ 523 | $ 7,761 | $ 811 | ||||
Real estate | 294 | 160 | (14) | 455 | (1) | ||||
Overdrafts | 148 | 87 | 133 | 235 | 186 | ||||
Consumer | 148 | 101 | 29 | 249 | 295 | ||||
Credit card | (1) | (8) | (3) | (9) | (4) | ||||
Total net charge-offs | $ 7,489 | $ 1,202 | $ 668 | $ 8,691 | $ 1,287 | ||||
Net charge-offs as a percent of loans (annualized) | 2.70% | 0.43% | 0.24% | 1.57% | 0.23% |
PEOPLES BANCORP INC. SUPPLEMENTAL INFORMATION
June 30, | March 31, | December 31, | September 30, | June 30, | |||||
(in $000’s, end of period) | 2008 | 2008 | 2007 | 2007 | 2007 | ||||
Trust assets under management | $ 770,714 | $ 775,834 | $ 797,443 | $ 805,931 | $ 766,417 | ||||
Brokerage assets under management | $ 216,930 | $ 221,340 | $ 223,950 | $ 218,573 | $ 209,858 | ||||
Mortgage loans serviced for others | $ 182,299 | $ 178,763 | $ 176,742 | $ 176,380 | $ 172,314 | ||||
Employees (full-time equivalent) | 554 | 556 | 559 | 553 | 556 | ||||
Announced treasury share plans: (a) | |||||||||
Total shares authorized for plan | 500,000 | 500,000 | 925,000 | 425,000 | 425,000 | ||||
Shares purchased | - | 13,600 | 84,600 | 139,000 | 70,000 | ||||
Average price | $ - | $ 21.59 | $ 24.25 | $ 24.05 | $ 26.79 | ||||
(a) 2008 data reflects shares purchased under the repurchase plan announced on November 9, 2007, authorizing the repurchase of up to 500,000 common
shares, upon the completion of the 2007 Stock Repurchase Program. 2007 data reflects shares purchased under the repurchase plan announced on
November 9, 2007, and under the 2007 Stock Repurchase Program announced on January 12, 2007, authorizing the repurchase of up to 425,000 common
shares. The number of common shares purchased for treasury and average price paid are presented for the three-month period ended on the date indicated.
PEOPLES BANCORP INC.
Second Quarter 2008 Earnings Release
- Page 9 of 10 -
PEOPLES BANCORP INC. CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST INCOME
Three Months Ended | |||||||||||
June 30, 2008 | March 31, 2008 | June 30, 2007 | |||||||||
(in $000’s) | Balance | Income/ Expense | Yield/ Cost | Balance | Income/ Expense | Yield/ Cost | Balance | Income/ Expense | Yield/ Cost | ||
ASSETS | |||||||||||
Short-term investments | $ 3,391 | $ 17 | 2.17% | $ 4,017 | $ 32 | 3.11% | $ 3,505 | $ 44 | 4.98% | ||
Investment securities (a) | 598,111 | 7,991 | 5.35% | 581,638 | 7,810 | 5.37% | 540,614 | 6,820 | 5.05% | ||
Gross loans (a) | 1,114,474 | 18,954 | 6.81% | 1,113,023 | 19,879 | 7.17% | 1,130,555 | 21,540 | 7.64% | ||
Allowance for loan losses | (16,243) | (16,240) | (14,656) | ||||||||
Total earning assets | 1,699,733 | 26,962 | 6.36% | 1,682,438 | 27,721 | 6.61% | 1,660,018 | 28,404 | 6.86% | ||
Intangible assets | 67,395 | 67,831 | 68,142 | ||||||||
Other assets | 127,190 | 128,307 | 128,315 | ||||||||
Total assets | 1,894,318 | 1,878,576 | 1,856,475 | ||||||||
LIABILITIES AND EQUITY | |||||||||||
Interest-bearing deposits: | |||||||||||
Savings | 115,625 | 140 | 0.49% | 108,525 | 122 | 0.45% | 117,149 | 188 | 0.64% | ||
Interest-bearing demand deposits | 203,411 | 890 | 1.76% | 197,998 | 982 | 1.99% | 175,831 | 910 | 2.08% | ||
Money market | 165,592 | 816 | 1.98% | 152,202 | 1,058 | 2.80% | 147,385 | 1,451 | 3.95% | ||
Brokered time | 39,767 | 509 | 5.15% | 53,334 | 695 | 5.24% | 67,637 | 867 | 5.14% | ||
Retail time | 549,642 | 5,426 | 3.97% | 523,929 | 5,608 | 4.31% | 529,481 | 5,931 | 4.49% | ||
Total interest-bearing deposits | 1,074,037 | 7,781 | 2.91% | 1,035,988 | 8,465 | 3.29% | 1,037,483 | 9,347 | 3.61% | ||
Short-term borrowings | 148,854 | 778 | 2.07% | 188,615 | 1,539 | 3.24% | 220,758 | 2,841 | 5.09% | ||
Long-term borrowings | 270,746 | 3,115 | 4.58% | 257,598 | 3,009 | 4.65% | 210,657 | 2,559 | 4.81% | ||
Total borrowed funds | 419,600 | 3,893 | 3.69% | 446,213 | 4,548 | 4.05% | 431,415 | 5,400 | 4.96% | ||
Total interest-bearing liabilities | 1,493,637 | 11,674 | 3.13% | 1,482,201 | 13,013 | 3.52% | 1,468,898 | 14,747 | 4.01% | ||
Non-interest-bearing deposits | 180,399 | 172,994 | 173,565 | ||||||||
Other liabilities | 14,214 | 16,889 | 15,495 | ||||||||
Total liabilities | 1,688,250 | 1,672,084 | 1,657,958 | ||||||||
Stockholders’ equity | 206,068 | 206,492 | 198,517 | ||||||||
Total liabilities and equity | $ 1,894,318 | $ 1,878,576 | $ 1,856,475 | ||||||||
Net interest income/spread (a) | $ 15,288 | 3.23% | $ 14,708 | 3.09% | $ 13,657 | 2.85% | |||||
Net interest margin (a) | 3.61% | 3.51% | 3.31% | ||||||||
(a) Information presented on a fully tax-equivalent basis. |
PEOPLES BANCORP INC.
Second Quarter 2008 Earnings Release
- Page 10 of 10 -
Six Months Ended | ||||||||
June 30, 2008 | June 30, 2007 | |||||||
(in $000’s) | Balance | Income/ Expense | Yield/ Cost | Balance | Income/ Expense | Yield/ Cost | ||
ASSETS | ||||||||
Short-term investments | $ 3,704 | $ 49 | 2.68% | $ 3,693 | $ 90 | 4.89% | ||
Investment securities (a) | 589,876 | 15,801 | 5.36% | 549,902 | 14,100 | 5.13% | ||
Gross loans (a) | 1,113,748 | 38,833 | 6.98% | 1,130,041 | 42,909 | 7.64% | ||
Allowance for loan losses | (16,241) | (14,693) | ||||||
Total earning assets | 1,691,087 | 54,683 | 6.49% | 1,668,943 | 57,099 | 6.88% | ||
Intangible assets | 67,613 | 68,364 | ||||||
Other assets | 127,703 | 128,455 | ||||||
Total assets | 1,886,403 | 1,865,762 | ||||||
LIABILITIES AND EQUITY | ||||||||
Interest-bearing deposits: | ||||||||
Savings | 112,075 | 261 | 0.47% | 115,649 | 354 | 0.62% | ||
Interest-bearing demand deposits | 200,705 | 1,873 | 1.87% | 176,300 | 1,756 | 2.01% | ||
Money market | 158,897 | 1,874 | 2.37% | 144,410 | 2,820 | 3.94% | ||
Brokered time | 46,550 | 1,204 | 5.19% | 69,069 | 1,764 | 5.15% | ||
Retail time | 536,785 | 11,034 | 4.12% | 530,622 | 11,780 | 4.48% | ||
Total interest-bearing deposits | 1,055,012 | 16,246 | 3.10% | 1,036,050 | 18,474 | 3.60% | ||
9,031 | ||||||||
Short-term borrowings | 168,734 | 2,317 | 2.72% | 234,967 | 6,056 | 5.14% | ||
Long-term borrowings | 264,172 | 6,124 | 4.61% | 208,513 | 5,056 | 4.86% | ||
Total borrowed funds | 432,906 | 8,441 | 3.87% | 443,480 | 11,112 | 4.99% | ||
Total interest-bearing liabilities | 1,487,918 | 24,687 | 3.32% | 1,479,530 | 29,586 | 4.02% | ||
Non-interest-bearing deposits | 176,696 | 172,351 | ||||||
Other liabilities | 15,509 | 15,817 | ||||||
Total liabilities | 1,680,123 | 1,667,698 | ||||||
Stockholders’ equity | 206,280 | 198,064 | ||||||
Total liabilities and equity | $ 1,886,403 | $ 1,865,762 | ||||||
Net interest income/spread (a) | $ 29,996 | 3.17% | $ 27,513 | 2.86% | ||||
Net interest margin (a) | 3.56% | 3.32% |
END OF RELEASE