Exhibit 99 | |||||||
News Release | |||||||
| First Midwest Bancorp | ||||||
FOR IMMEDIATE RELEASE | CONTACT: | Michael L. Scudder | |||||
EVP, Chief Financial Officer | |||||||
TRADED: | Nasdaq | (630) 875-7283 | |||||
SYMBOL: | FMBI | www.firstmidwest.com | |||||
FIRST MIDWEST REPORTS SOLID FIRST QUARTER RESULTS | |||||||
1st QUARTER HIGHLIGHTS: | |||||||
* | Strong Profitability: ROA of 1.44% | ||||||
* | Stock Option Accounting Expense: $0.01 Per Share | ||||||
* | Stable Net Margin: 3.76% vs. 3.79% in 4Q05 | ||||||
* | Lower Credit Costs: Net Charge-offs to Average Loans of 0.15% | ||||||
* | Fee-based Income Increased: Up 11.6% vs. 1Q05 | ||||||
* | Bank Calumet Acquired, Integration on Plan |
ITASCA, IL, APRIL 26, 2006 -First Midwest Bancorp, Inc. ("First Midwest")(Nasdaq: FMBI) today reported net income for first quarter ended March 31, 2006 of $25.8 million, or $0.55 on a per diluted share basis, as compared to $25.2 million, or $0.55 per diluted share, in first quarter 2005. First quarter 2006 operating results included stock option expense attributable to the adoption of FAS 123R of $656 thousand, or $0.01 per diluted share. Earnings per diluted share for the quarter were also negatively influenced by the issuance of 4.4 million common shares in mid-March to aid in the financing of the Company's acquisition of Bank Calumet on March 31, 2006.
First quarter 2006 performance resulted in an annualized return on average assets of 1.44%, as compared to 1.49% for first quarter 2005 and an annualized return on average equity of 17.6%, as compared to 19.1% for first quarter 2005.
1
"I am pleased to report a strong start to 2006," said First Midwest President and Chief Executive Officer John M. O'Meara. "In addition to effectively executing our sales and operating plans, we closed our acquisition of Bank Calumet ahead of schedule, and successfully completed the issuance of both equity and debt, a modest staff restructuring, and certain broad-based contract renegotiations." O'Meara continued, "Loan and deposit expansion was solid during the first quarter, credit costs were controlled, and our fee-based business, compared to the first quarter of 2005, expanded at a double digit pace. While we continue to face challenges in our spread businesses, we remain well positioned to deliver solid growth and profitability over the near-term, while continuing to focus our efforts on maximizing long-term franchise valuation."
Earnings Guidance
O'Meara concluded, "Sustained margin pressure should be offset by greater than expected acquisition synergies, continued credit cost controls, expanded fee-based revenues, and diligent expense control. As a result, we currently expect full year diluted earnings per share to be in the range of $2.42 to $2.50."
Net Interest Margin
Net interest income for first quarter 2006 was $57.5 million, up approximately $400 thousand from first quarter 2005. Net interest margin for the first quarter of 2006 was 3.76%, down an expected 3 basis points from fourth quarter 2005, reflecting deposit shifts to higher cost categories, which were partially offset by higher variable-rate asset yields.
Loan Growth and Funding
Outstanding loans as of March 31, 2006 totaled $5.0 billion, a 21.4% increase from $4.2 billion at March 31, 2005 and up from $4.3 billion at December 31, 2005, primarily due to loans acquired as part of the acquisition of Bank Calumet. Excluding $682.3 million in loans acquired in the Bank Calumet acquisition, loans increased approximately 1.3%, or 5.2% annualized, as compared to December 31, 2005, primarily due to increased corporate lending. As of March 31, 2006, corporate loans totaled $3.9 billion, up from $3.4 billion as of December 31, 2005. Excluding $402.1 million of loans acquired in the Bank Calumet acquisition, corporate loans increased 2.8%, or 11.2% annualized, compared to December 31, 2005. This increase primarily reflects growth in both commercial and construction real estate lending.
2
As of March 31, 2006, total deposits were $6.1 billion, up 21.9% compared to March 31, 2005, primarily due to the acquisition of Bank Calumet. Average deposits for first quarter 2006 totaled $5.1 billion, reflecting growth in both demand and time deposit balances. In comparison to first quarter 2005, average demand balances increased 2.6%, and average time deposit balances grew 19.3%.
Noninterest Income and Expense
First Midwest's total noninterest income for first quarter 2006 was $21.4 million, up 6.1% as compared to $20.1 million in first quarter 2005, reflecting the benefits of higher fee-based revenues, income from corporate owned life insurance and other income, offset by $2.2 million in lower gains realized from the sale of securities. Fee-based revenues for first quarter 2006 totaled $17.8 million, up 11.6% as compared to $16.0 million in first quarter 2005, primarily due to greater service charge revenue.
Total noninterest expense for first quarter 2006 was $43.7 million, up 9.9% from $39.8 million in first quarter 2005, primarily due to increased salaries and benefits, occupancy, and other expenses. Salary and benefit cost increases reflect the combined impact of merit wage adjustments, $656 thousand in stock option accounting expense, higher retirement plan expenses, and $723 thousand of severance costs related to a modest restructuring of staff. First Midwest's efficiency ratio was 51.5% for first quarter 2006, as compared to 49.9% for first quarter 2005.
Credit Quality
First Midwest's overall credit quality remains strong. As of March 31, 2006, nonperforming assets totaled $21.2 million, including $2.5 million in nonperforming assets acquired from Bank Calumet as compared to $14.9 million at year-end 2005. At March 31, 2006, nonperforming assets represented 0.42% of loans plus foreclosed real estate, as compared to 0.35% at December 31, 2005. Net charge-offs for first quarter 2006 improved to 0.15% of average loans, a 40.0% reduction from 0.25% for fourth quarter 2005. Nonaccrual loans totaled $17.2 million, up approximately $5.2 million from year-end 2005. This increase is concentrated in three credits, which presently do not appear to have significant exposure to loss. As of March 31, 2006, the reserve for loan losses stood at 1.24% of total loans, as compared to 1.31% as of December 31, 2005.
3
Capital Management
First Midwest's capital position continues to exceed all of the regulatory minimum levels to be considered a "well capitalized institution" by the Federal Reserve. As of March 31, 2006, First Midwest's Total Risk Based Capital was 11.06%, compared to 11.76% as of December 31, 2005. Its Tier 1 Risk Based Capital ratio was 8.51%, compared to 10.72% as of December 31, 2005. First Midwest's tangible capital ratio, which represents the ratio of stockholders' equity to total assets excluding intangible assets, stood at 4.67%, down from 6.30% as of December 31, 2005. This decline was primarily due to an increase in goodwill and other intangible assets resulting from the acquisition of Bank Calumet and changes in accumulated other comprehensive income, stemming from declines in the market value of available-for-sale securities. First Midwest has elected to discontinue its stock repurchase program, as it looks to rebuild tangible capital following the acquisition of Bank Calumet.
Bank Calumet Acquisition
On March 31, 2006, First Midwest consummated its acquisition of Bank Calumet. In exchange for $307 million in cash, all of the outstanding shares of Bank Calumet were acquired making it a wholly owned subsidiary of First Midwest Bancorp, Inc. The conversion of Bank Calumet's primary data processing systems to those of First Midwest is expected to be completed in May, 2006.
Bank Calumet's 30 offices and $939.9 million in deposits when joined with First Midwest, creates the sixth largest branch distribution network in metropolitan Chicago and the eleventh overall largest depository. Further, trust assets under management exceed $3.5 billion, creating the sixth largest trust company in the State of Illinois.
While the long-term synergies from the combined entity are compelling, the impact of integrating the operations was partially manifested in first quarter 2006 financial performance as the cost of debt financing and the dilutive impact of the 4.4 million common share offering preceded the March 31, 2006 transaction close. As a result, the share offering increased average diluted shares outstanding for the quarter by approximately 1.1 million shares, which lowered quarterly earnings per share by $0.01. During the remainder of 2006, additional integration expenses are expected to approximate
4
$3.0 million, with the majority of these expenses expected to be reflected in second quarter 2006. The quarters ahead should demonstrate the strategic nature of this acquisition through higher growth and better operating leverage.
About the Company
First Midwest is the premier relationship-based banking franchise in the growing Chicagoland banking market. As one of the Chicago metropolitan area's largest independent bank holding companies, First Midwest provides the full range of both business and retail banking and trust and investment management services through 101 offices located in 61 communities, primarily in metropolitan Chicago. First Midwest was the only bank named byChicago magazine as one of the 25 best places to work in Chicago.
Safe Harbor Statement
Safe Harbor Statement under the Private Securities Act of 1995: Statements in this news release that are forward-looking statements are subject to various risks and uncertainties concerning specific factors described in First Midwest Bancorp's 2005 Form 10-K and other filings with the U.S. Securities and Exchange Commission. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. First Midwest does not intend to update this information and disclaims any legal obligation to the contrary. Historical information is not necessarily indicative of future performance.
Accompanying Financial Statements and Tables |
Accompanying this press release is the following unaudited financial information: |
* Operating Highlights, Balance Sheet Highlights and Stock Performance Data (1 page) * Condensed Consolidated Statements of Condition (1 page) * Condensed Consolidated Statements of Income (1 page) * Selected Quarterly Data and Asset Quality (1 page) |
Press Release and Additional Information Available on Website |
This press release, the accompanying financial statements and tables and certain additional unaudited selected financial information (totaling 3 pages) are available through the "Investor Relations" section of First Midwest's website atwww.firstmidwest.com. |
5
First Midwest Bancorp, Inc. | Press Release Dated April 26, 2006 | ||||||||||
Operating Highlights | Quarters Ended | ||||||||||
Unaudited | March 31, | ||||||||||
(Amounts in thousands except per share data) | 2006 | 2005 | |||||||||
Net income | $ | 25,768 | $ | 25,207 | |||||||
Diluted earnings per share | $ | 0.55 | $ | 0.55 | |||||||
Return on average equity | 17.64% | 19.14% | |||||||||
Return on average assets | 1.44% | 1.49% | |||||||||
Net interest margin | 3.76% | 3.87% | |||||||||
Efficiency ratio | 51.51% | 49.88% | |||||||||
Balance Sheet Highlights | |||||||||||
Unaudited | |||||||||||
(Amounts in thousands except per share data) | Mar. 31, 2006 | Mar. 31, 2005 | |||||||||
Total assets | $ | 8,715,524 | $ | 6,910,482 | |||||||
Total loans | 5,042,135 | 4,153,728 | |||||||||
Total deposits | 6,050,839 | 4,962,859 | |||||||||
Stockholders' equity | 688,484 | 519,163 | |||||||||
Book value per share | $ | 13.81 | $ | 11.35 | |||||||
Period end shares outstanding | 49,866 | 45,732 | |||||||||
Stock Performance Data | Quarters Ended | ||||||||||
Unaudited | March 31, | ||||||||||
2006 | 2005 | ||||||||||
Market Price: | |||||||||||
Quarter End | $ | 36.57 | $ | 32.48 | |||||||
High | $ | 37.14 | $ | 36.75 | |||||||
Low | $ | 32.62 | $ | 31.92 | |||||||
Quarter end price to book value | 2.6 | x | 2.9 | x | |||||||
Quarter end price to consensus estimated 2006 earnings | 13.4 | x | N/A | ||||||||
Dividends declared per share | $ | 0.275 | $ | 0.240 | |||||||
6
First Midwest Bancorp, Inc. | Press Release Dated April 26, 2006 | |||||||
Condensed Consolidated Statements of Condition | ||||||||
Unaudited(1) | March 31, | |||||||
(Amounts in thousands) | 2006 | 2005 | ||||||
Assets | ||||||||
Cash and due from banks | $ | 210,810 | $ | 125,150 | ||||
Funds sold and other short-term investments | 8,514 | 6,083 | ||||||
Securities available for sale | 2,654,189 | 2,170,720 | ||||||
Securities held to maturity, at amortized cost | 121,012 | 73,725 | ||||||
Loans | 5,042,135 | 4,153,728 | ||||||
Reserve for loan losses | (62,320) | (56,244) | ||||||
Net loans | 4,979,815 | 4,097,484 | ||||||
Premises, furniture, and equipment | 121,549 | 88,695 | ||||||
Investment in corporate owned life insurance | 194,333 | 152,554 | ||||||
Goodwill and other intangible assets | 294,839 | 96,180 | ||||||
Accrued interest receivable and other assets | 130,463 | 99,891 | ||||||
Total assets | $ | 8,715,524 | $ | 6,910,482 | ||||
Liabilities and Stockholders' Equity | ||||||||
Deposits | $ | 6,050,839 | $ | 4,962,859 | ||||
Borrowed funds | 1,629,084 | 1,179,753 | ||||||
Long-term debt | 227,472 | 129,042 | ||||||
Accrued interest payable and other liabilities | 119,645 | 119,665 | ||||||
Total liabilities | 8,027,040 | 6,391,319 | ||||||
Common stock | 613 | 569 | ||||||
Additional paid-in capital | 204,458 | 61,757 | ||||||
Retained earnings | 774,607 | 721,645 | ||||||
Accumulated other comprehensive (loss) | (22,548) | (5,327) | ||||||
Treasury stock, at cost | (268,646) | (259,481) | ||||||
Total stockholders' equity | 688,484 | 519,163 | ||||||
Total liabilities and stockholders' equity | $ | 8,715,524 | $ | 6,910,482 | ||||
- While unaudited, the Condensed Consolidated Statements of Condition have been prepared in accordance with U.S. generally accepted accounting principles and, as of March 31, 2005, are derived from quarterly financial statements on which Ernst & Young LLP, First Midwest's independent external auditor, has rendered a Quarterly Review Report; Ernst & Young is currently in the process of completing their Quarterly Review Report for the quarter ended March 31, 2006.
7
First Midwest Bancorp, Inc. | Press Release Dated April 26, 2006 | ||||||||||
Condensed Consolidated Statements of Income | Quarters Ended | ||||||||||
Unaudited(1) | March 31, | ||||||||||
(Amounts in thousands except per share data) | 2006 | 2005 | |||||||||
Interest Income | |||||||||||
Loans | $ | 74,315 | $ | 59,615 | |||||||
Securities | 27,051 | 23,484 | |||||||||
Other | 159 | 56 | |||||||||
Total interest income | 101,525 | 83,155 | |||||||||
Interest Expense | |||||||||||
Deposits | 28,468 | 17,160 | |||||||||
Borrowed funds | 13,228 | 6,823 | |||||||||
Long-term debt | 2,364 | 2,063 | |||||||||
Total interest expense | 44,060 | 26,046 | |||||||||
Net interest income | 57,465 | 57,109 | |||||||||
Provision for loan losses | 1,590 | 3,150 | |||||||||
Net interest income after provision for loan losses | 55,875 | 53,959 | |||||||||
Noninterest Income | |||||||||||
Service charges on deposit accounts | 7,624 | 6,693 | |||||||||
Trust and investment management fees | 3,172 | 3,129 | |||||||||
Other service charges, commissions, and fees | 4,465 | 3,810 | |||||||||
Card-based fees | 2,569 | 2,347 | |||||||||
Subtotal, fee-based revenues | 17,830 | 15,979 | |||||||||
Corporate owned life insurance income | 1,504 | 1,195 | |||||||||
Security gains, net | 369 | 2,561 | |||||||||
Other | 1,669 | 411 | |||||||||
Total noninterest income | 21,372 | 20,146 | |||||||||
Noninterest Expense | |||||||||||
Salaries and employee benefits | 25,632 | 22,853 | |||||||||
Net occupancy expense | 4,458 | 4,261 | |||||||||
Equipment expense | 2,131 | 2,095 | |||||||||
Technology and related costs | 1,444 | 1,381 | |||||||||
Other | 10,047 | 9,182 | |||||||||
Total noninterest expense | 43,712 | 39,772 | |||||||||
Income before taxes | 33,535 | 34,333 | |||||||||
Income tax expense | 7,767 | 9,126 | |||||||||
Net Income | $ | 25,768 | $ | 25,207 | |||||||
Diluted Earnings Per Share | $ | 0.55 | $ | 0.55 | |||||||
Dividends Declared Per Share | $ | 0.275 | $ | 0.240 | |||||||
Weighted Average Diluted Shares Outstanding | 46,879 | 46,164 | |||||||||
- While unaudited, the Condensed Consolidated Statements of Income have been prepared in accordance with U.S. generally accepted accounting principles and, for the quarter ended March 31, 2005, are derived from quarterly financial statements on which Ernst & Young LLP, First Midwest's independent external auditor, has rendered a Quarterly Review Report; Ernst & Young is currently in the process of completing their Quarterly Review Report for the quarter ended March 31, 2006.
8
First Midwest Bancorp, Inc. | Press Release Dated April 26, 2006 | ||||||||||||||||||||||
Selected Quarterly Data | |||||||||||||||||||||||
Unaudited | Quarters Ended | ||||||||||||||||||||||
(Amounts in thousands except per share data) | 3/31/06 | 12/31/05 | 9/30/05 | 6/30/05 | 03/31/05 | ||||||||||||||||||
Net interest income | $ | 57,465 | $ | 59,349 | $ | 59,981 | $ | 59,411 | $ | 57,109 | |||||||||||||
Provision for loan losses | 1,590 | 2,780 | 1,200 | 1,800 | 3,150 | ||||||||||||||||||
Noninterest income | 21,372 | 14,410 | 20,383 | 19,673 | 20,146 | ||||||||||||||||||
Noninterest expense | 43,712 | 42,578 | 42,108 | 41,245 | 39,772 | ||||||||||||||||||
Net income | 25,768 | 22,630 | 27,030 | 26,510 | 25,207 | ||||||||||||||||||
Diluted earnings per share | $ | 0.55 | $ | 0.49 | $ | 0.59 | $ | 0.58 | $ | 0.55 | |||||||||||||
Return on average equity | 17.64% | 16.58% | 19.76% | 19.85% | 19.14% | ||||||||||||||||||
Return on average assets | 1.44% | 1.25% | 1.51% | 1.52% | 1.49% | ||||||||||||||||||
Net interest margin | 3.76% | 3.79% | 3.88% | 3.93% | 3.87% | ||||||||||||||||||
Efficiency ratio | 51.51% | 49.76% | 49.39% | 48.75% | 49.88% | ||||||||||||||||||
Period end shares outstanding | 49,866 | 45,387 | 45,385 | 45,399 | 45,732 | ||||||||||||||||||
Book value per share | $ | 13.81 | $ | 11.99 | $ | 11.81 | $ | 11.83 | $ | 11.35 | |||||||||||||
Dividends declared per share | $ | 0.275 | $ | 0.275 | $ | 0.250 | $ | 0.250 | $ | 0.240 | |||||||||||||
Asset Quality | |||||||||||||||||||||||
Unaudited | Quarters Ended | ||||||||||||||||||||||
(Amounts in thousands) | 3/31/06 | 12/31/05 | 9/30/05 | 6/30/05 | 3/31/05 | ||||||||||||||||||
Nonaccrual loans | $ | 17,178 | $ | 11,990 | $ | 12,206 | $ | 11,419 | $ | 16,407 | |||||||||||||
Foreclosed real estate | 4,033 | 2,878 | 2,711 | 2,905 | 3,270 | ||||||||||||||||||
Loans past due 90 days and still accruing | 10,693 | 8,958 | 10,386 | 7,463 | 4,625 | ||||||||||||||||||
Nonperforming loans to loans | 0.34% | 0.28% | 0.28% | 0.27% | 0.39% | ||||||||||||||||||
Nonperforming assets to loans plus foreclosed real estate | 0.42% | 0.35% | 0.35% | 0.34% | 0.47% | ||||||||||||||||||
Nonperforming assets plus loans past due 90 days to loans plus foreclosed real estate................................................ | 0.63% | 0.55% | 0.59% | 0.52% | 0.58% | ||||||||||||||||||
Reserve for loan losses to loans | 1.24% | 1.31% | 1.31% | 1.33% | 1.35% | ||||||||||||||||||
Reserve for loan losses to nonperforming loans | 363% | 470% | 461% | 493% | 343% | ||||||||||||||||||
Provision for loan losses | $ | 1,590 | $ | 2,780 | $ | 1,200 | $ | 1,800 | $ | 3,150 | |||||||||||||
Net loan charge-offs | 1,565 | 2,670 | 1,179 | 1,782 | 3,624 | ||||||||||||||||||
Net loan charge-offs to average loans, annualized | 0.15% | 0.25% | 0.11% | 0.17% | 0.36% | ||||||||||||||||||
9