INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Supplemental Data
Exhibit 99.2
Non-performing assets
March 31, 2007 | December 31, 2006 | |||||||
---|---|---|---|---|---|---|---|---|
(dollars in thousands) | ||||||||
Non-accrual loans | $ | 41,075 | $ | 35,683 | ||||
Loans 90 days or more past due and | ||||||||
still accruing interest | 6,941 | 3,479 | ||||||
Restructured loans | 55 | 60 | ||||||
Total non-performing loans | 48,071 | 39,222 | ||||||
Other real estate | 3,631 | 3,153 | ||||||
Total non-performing assets | $ | 51,702 | $ | 42,375 | ||||
As a percent of Portfolio Loans | ||||||||
Non-performing loans | 1.93 | % | 1.58 | % | ||||
Allowance for loan losses | 1.22 | 1.08 | ||||||
Non-performing assets to total assets | 1.54 | 1.24 | ||||||
Allowance for loan losses as a percent of | ||||||||
non-performing loans | 63 | 69 |
Allowance for loan losses
Three months ended March 31, | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
2007 | 2006 | |||||||||||||
Loan Losses | Unfunded Commitments | Loan Losses | Unfunded Commitments | |||||||||||
(in thousands) | ||||||||||||||
Balance at beginning of period | $ | 26,879 | $ | 1,881 | $ | 22,420 | $ | 1,820 | ||||||
Additions (deduction) | ||||||||||||||
Provision charged to operating expense | 7,339 | 150 | 1,388 | (2 | ) | |||||||||
Recoveries credited to allowance | 555 | 630 | ||||||||||||
Loans charged against the allowance | (4,515 | ) | (1,714 | ) | ||||||||||
Balance at end of period | $ | 30,258 | $ | 2,031 | $ | 22,724 | $ | 1,818 | ||||||
Net loans charged against the allowance to | ||||||||||||||
average Portfolio Loans (annualized) | 0.65 | % | 0.18 | % |
Alternative Sources of Funds
March 31, 2007 | December 31, 2006 | |||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Amount | Average Maturity | Rate | Amount | Average Maturity | Rate | |||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
Brokered CDs(1) | $ | 882,128 | 1.8 years | 4.91 | % | $ | 1,055,010 | 1.9 years | 4.72 | % | ||||||||||
Fixed rate FHLB advances(1) | 43,270 | 5.9 years | 6.09 | 58,272 | 4.6 years | 5.66 | ||||||||||||||
Variable rate FHLB advances(1) | 2,000 | 0.5 years | 5.31 | |||||||||||||||||
Securities sold under agreements to | ||||||||||||||||||||
Repurchase(1) | 83,431 | 0.1 years | 5.34 | |||||||||||||||||
Federal funds purchased | 84,081 | 1 day | 5.40 | |||||||||||||||||
Total | $ | 925,398 | 2.0 years | 4.96 | % | $ | 1,282,794 | 1.8 years | 4.85 | % | ||||||||||
(1) Certain of these items have had their average maturity and rate altered through the use of derivative instruments, including pay-fixed and pay-variable interest rate swaps.
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Capitalization
March 31, 2007 | December 31, 2006 | |||||||
---|---|---|---|---|---|---|---|---|
(in thousands) | ||||||||
Unsecured debt | $ | 4,500 | $ | 5,000 | ||||
Subordinated debentures | 64,197 | 64,197 | ||||||
Amount not qualifying as regulatory capital | (1,847 | ) | (1,847 | ) | ||||
Amount qualifying as regulatory capital | 62,350 | 62,350 | ||||||
Shareholders' Equity | ||||||||
Preferred stock, no par value | ||||||||
Common stock, par value $1.00 per share | 22,584 | 22,865 | ||||||
Capital surplus | 194,902 | 200,241 | ||||||
Retained earnings | 31,353 | 31,420 | ||||||
Accumulated other comprehensive income | 3,407 | 3,641 | ||||||
Total shareholders' equity | 252,246 | 258,167 | ||||||
Total capitalization | $ | 319,096 | $ | 325,517 | ||||
Non-Interest Income
Three months ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
March 31, 2007 | December 31, 2006 | March 31, 2006 | |||||||||
(in thousands) | |||||||||||
Service charges on deposit | |||||||||||
accounts | $ | 4,888 | $ | 5,152 | $ | 4,468 | |||||
Mepco litigation settlement | 2,800 | ||||||||||
Net gains on assets sales | |||||||||||
Real estate mortgage loans | 1,081 | 1,264 | 1,026 | ||||||||
Securities | 79 | ||||||||||
VISA check card interchange income | 950 | 900 | 791 | ||||||||
Real estate mortgage loan servicing | 527 | 605 | 653 | ||||||||
Mutual fund and annuity commissions | 479 | 321 | 295 | ||||||||
Bank owned life insurance | 449 | 433 | 392 | ||||||||
Title insurance fees | 414 | 426 | 442 | ||||||||
Manufactured home loan origination fees | |||||||||||
and commissions | 114 | 184 | 239 | ||||||||
Other | 1,689 | 1,461 | 1,432 | ||||||||
Total non-interest income | $ | 10,670 | $ | 10,746 | $ | 12,538 | |||||
Real Estate Mortgage Loan Activity
Three months ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
March 31, 2007 | December 31, 2006 | March 31, 2006 | |||||||||
(in thousands) | |||||||||||
Real estate mortgage loans originated | $ | 116,815 | $ | 125,031 | $ | 118,651 | |||||
Real estate mortgage loans sold | 69,212 | 72,298 | 60,247 | ||||||||
Real estate mortgage loans sold with servicing rights released | 11,679 | 11,436 | 7,444 | ||||||||
Net gains on the sale of real estate mortgage loans | 1,081 | 1,264 | 1,026 | ||||||||
Net gains as a percent of real estate mortgage loans sold | |||||||||||
("Loan Sale Margin") | 1.56 | % | 1.75 | % | 1.70 | % | |||||
SFAS #133 adjustments included in the Loan Sale Margin | (0.04 | )% | .15 | % | 0.21 | % |
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Capitalized Real Estate Mortgage Loan Servicing Rights
Three months ended March 31, | ||||||||
---|---|---|---|---|---|---|---|---|
2007 | 2006 | |||||||
(in thousands) | ||||||||
Balance at beginning of period | $ | 14,782 | $ | 13,439 | ||||
Originated servicing rights capitalized | 686 | 634 | ||||||
Amortization | (407 | ) | (345 | ) | ||||
(Increase)/decrease in impairment reserve | (100 | ) | ||||||
Balance at end of period | $ | 14,961 | $ | 13,728 | ||||
Impairment reserve at end of period | $ | 168 | $ | 11 | ||||
Non-Interest Expense
Three months ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
March 31, 2007 | December 31, 2006 | March 31, 2006 | ||||||||||
(in thousands) | ||||||||||||
Salaries | $ | 10,001 | $ | 9,380 | $ | 9,376 | ||||||
Performance-based compensation and benefits | 1,321 | 1,536 | 1,489 | |||||||||
Other benefits | 2,646 | 2,407 | 2,676 | |||||||||
Compensation and employee benefits | 13,968 | 13,323 | 13,541 | |||||||||
Occupancy, net | 2,614 | 2,311 | 2,687 | |||||||||
Furniture, fixtures and equipment | 1,900 | 1,874 | 1,783 | |||||||||
Data processing | 1,438 | 1,481 | 1,342 | |||||||||
Advertising | 1,152 | 988 | 987 | |||||||||
Loan and collection | 1,006 | 896 | 823 | |||||||||
Credit card and bank service fees | 967 | 959 | 907 | |||||||||
Communications | 830 | 852 | 991 | |||||||||
Supplies | 607 | 553 | 509 | |||||||||
Amortization of intangible assets | 570 | 600 | 600 | |||||||||
Legal and professional | 506 | 516 | 488 | |||||||||
Branch acquisition and conversion costs | 422 | |||||||||||
Goodwill impairment | 343 | 2,963 | ||||||||||
Loss on receivable from warranty | ||||||||||||
payment plan seller | 2,400 | |||||||||||
Other | 1,643 | 1,372 | 1,580 | |||||||||
Total non-interest expense | $ | 27,966 | $ | 31,088 | $ | 26,238 | ||||||
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Average Balances and Tax Equivalent Rates
Three Months Ended March 31, | ||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
2007 | 2006 | |||||||||||||||||||
Average Balance | Interest | Rate | Average Balance | Interest | Rate | |||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
Assets Taxable loans (1) | $ | 2,509,746 | $ | 49,849 | 8.02 | % | $ | 2,408,268 | $ | 45,978 | 7.71 | % | ||||||||
Tax-exempt loans (1,2) | 9,513 | 160 | 6.82 | 5,894 | 105 | 7.22 | ||||||||||||||
Taxable securities | 185,139 | 2,477 | 5.43 | 220,333 | 2,848 | 5.24 | ||||||||||||||
Tax-exempt securities (2) | 238,654 | 4,121 | 7.00 | 255,798 | 4,533 | 7.19 | ||||||||||||||
Other investments | 25,563 | 314 | 4.98 | 17,437 | 223 | 5.19 | ||||||||||||||
Interest Earning Assets - | ||||||||||||||||||||
Continuing Operations | 2,968,615 | 56,921 | 7.74 | 2,907,730 | 53,687 | 7.46 | ||||||||||||||
Cash and due from banks | 53,228 | 54,357 | ||||||||||||||||||
Taxable loans - discontinued operations | 33,084 | 195,140 | ||||||||||||||||||
Other assets, net | 205,532 | 204,781 | ||||||||||||||||||
Total Assets | $ | 3,260,459 | $ | 3,362,008 | ||||||||||||||||
Liabilities | ||||||||||||||||||||
Savings and NOW | $ | 903,426 | 4,249 | 1.91 | $ | 878,731 | 2,988 | 1.38 | ||||||||||||
Time deposits | 1,506,171 | 18,159 | 4.89 | 1,362,322 | 12,939 | 3.85 | ||||||||||||||
Long-term debt | 2,994 | 34 | 4.61 | 4,994 | 57 | 4.63 | ||||||||||||||
Other borrowings | 199,667 | 3,270 | 6.64 | 322,374 | 4,267 | 5.37 | ||||||||||||||
Interest Bearing Liabilities- | ||||||||||||||||||||
Continuing Operations | 2,612,258 | 25,712 | 3.99 | 2,568,421 | 20,251 | 3.20 | ||||||||||||||
Demand deposits | 282,172 | 275,597 | ||||||||||||||||||
Time deposits - discontinued operations | 24,732 | 167,460 | ||||||||||||||||||
Other liabilities | 81,636 | 102,345 | ||||||||||||||||||
Shareholders' equity | 259,661 | 248,185 | ||||||||||||||||||
Total liabilities and shareholders' equity | $ | 3,260,459 | $ | 3,362,008 | ||||||||||||||||
Tax Equivalent Net Interest Income | $ | 31,209 | $ | 33,436 | ||||||||||||||||
Tax Equivalent Net Interest Income | ||||||||||||||||||||
as a Percent of Earning Assets | 4.23 | % | 4.64 | % | ||||||||||||||||
(1) | All domestic |
(2) | Interest on tax-exempt loans and securities is presented on a fully tax equivalent basis assuming a marginal tax rate of 35% |
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