Exhibit 99.1
| News Release | ||||||
 | First Midwest Bancorp, Inc. | First Midwest Bancorp, Inc. One Pierce Place, Suite 1500 Itasca, Illinois 60143 (630) 875-7450 | ||||
| FOR IMMEDIATE RELEASE | CONTACT: | Paul F. Clemens | ||||
| Chief Financial Officer | ||||||
| (630) 875-7347 | ||||||
| TRADED: NASDAQ Global Select Market | www.firstmidwest.com | |||||
| SYMBOL: FMBI | ||||||
FIRST MIDWEST BANCORP, INC. ANNOUNCES 2010
SECOND QUARTER RESULTS
Increased Core Operating Performance – Improved Credit Quality – Solid Capital
Operating Performance
| • | Net income of $7.8 million for second quarter 2010 vs. $8.1 million for first quarter 2010 and $2.7 million for second quarter 2009. |
| • | Pre-tax, pre-provision core operating earnings of $33.0 million for second quarter 2010, up $1.4 million, or 4.3%, from first quarter 2010 and up $1.2 million, or 3.7%, from second quarter 2009. |
| • | Average core transactional deposits up approximately $561.0 million, or 15.0%, from second quarter 2009. |
| • | Total loan balances remain stable with Commercial and Industrial up $39 million, or 11% annualized, from March 31, 2010. |
Capital and Credit
| • | Tangible common equity to risk-based assets of 10.71%, up 19 basis points from first quarter 2010. |
| • | Non-performing loans reduced by $24.1 million, or 10.8%, from March 31, 2010 and $63.4 million, or 24%, from June 30, 2009. |
| • | Loan loss reserves to non-performing loans of 73% at June 30, 2010, compared to 65% at March 31, 2010 and 48% at June 30, 2009. |
ITASCA, IL, JULY 21, 2010 – Today First Midwest Bancorp, Inc. (the “Company” or “First Midwest”)(NASDAQ NGS: FMBI), the holding company of First Midwest Bank, reported results of operations and financial condition for second quarter 2010. Net income for the quarter was $7.8 million, before adjustment for preferred dividends and non-vested restricted shares, with net income of $5.2 million, or $0.07 per share, available to common shareholders after such adjustments. This
1
compares to net income available to common shareholders of $5.4 million, or $0.08 per share, for first quarter 2010 and net income available to common shareholders of $63,000, or $0.00 per share, for second quarter 2009.
Summary Update
In making the announcement, Michael L. Scudder, President and Chief Executive Officer of First Midwest Bancorp, Inc., said, “Performance for the quarter reflected continued success in growing our core business and ongoing efforts to improve overall credit performance. While higher credit-related costs weighed against overall earnings, our core operating performance was solid, reflecting both linked quarter and year-over-year advances. Growth in commercial lending and overall stable loan levels, as well as a notable increase in fee-based revenues from our asset management and card-based businesses, reflect a targeted investment in our sales resources and calling activity. During the quarter, we acquired Peotone Bank and Trust Company from the FDIC, adding to our existing market footprint. In what remains a difficult environment, improvement was noted in virtually every measure of asset quality, with nonperforming loans down approximately 11% from the first quarter of 2010.”
Mr. Scudder continued, “While we have seen signs of economic improvement, the pace of recovery remains slow, due to consumer and business uncertainty as well as persistent weakness in real estate. These same conditions combine to create continued challenges as the industry and the Company strive to reduce problem asset levels and remediation costs. At the same time, I firmly believe First Midwest’s core earnings strength, market presence and leading capital foundation leave us well positioned to pursue opportunities to grow our core business.”
Operating Performance
The Company generated pre-tax, pre-provision core operating earnings of $33.0 million for second quarter 2010, compared to $31.6 million for first quarter 2010 and $31.8 million for second quarter 2009. The 4% increases compared to both prior periods were the result of higher net interest income derived from higher yields on earning assets and significantly lower funding costs. These increases more than offset higher expenses incurred to remediate troubled assets. A reconciliation of earnings in accordance with U.S. generally accepted accounting principles (“GAAP”) to the non-GAAP financial measures of pre-tax, pre-provision core operating earnings is presented on page 12 of this earnings release.
Total loans as of June 30, 2010 of $5.2 billion were relatively unchanged from March 31, 2010, although commercial and industrial loans increased by 11% annualized. The year-over-year decline of
2
$132.4 million from June 30, 2009 was due primarily to a 44% decrease in the residential and commercial construction and land loan portfolios, as the Company continued to remediate and reduce exposure to these lending categories.
Covered assets were $251.6 million at June 30, 2010, as compared to $207.6 million at March 31, 2010, and consist of loans, other real estate owned, and FDIC indemnification assets from the two FDIC-assisted acquisitions completed in October 2009 and April 2010. The quarter-over-quarter increase in covered assets is due to the acquisition of approximately $50 million of such assets from the former Peotone Bank and Trust Company on April 23, 2010, as discussed later in this release.
Average core transactional deposits for second quarter 2010 were $4.3 billion, an increase of $560 million, or 15.0%, from second quarter 2009. Excluding core transactional deposits acquired through FDIC-assisted transactions, the year-over-year increase in core transactional deposits was $470 million, or 12.6%, and reflects targeted marketing activities, higher seasonal balances maintained by municipal customers, and customers’ desires to maintain more liquid deposits.
Tax-equivalent net interest margin was 4.21% for second quarter 2010 compared to 4.28% for first quarter 2010. The decline in medium and long-term rates from the prior quarter resulted in a reduction in earning asset yields of 16 basis points, partially offsetting the decrease in cost of funds of 13 basis points. Also during the second quarter, average earning assets increased, mitigating the impact of the decline in interest rates and contributing $1.7 million to net interest income.
Tax-equivalent net interest margin improved 68 basis points to 4.21% for second quarter 2010 from 3.53% for second quarter 2009, reflecting the impact of a comparative decline in short and long-term interest rates. A $360.0 million decline in lower yielding securities, decreased reliance on higher costing wholesale funds, and improved market liquidity all contributed to the reduction in the Company’s cost of funds.
Fee-based revenues of $21.9 million for second quarter 2010 were up 9.2% from first quarter 2010, reflecting increases in all major fee categories. These revenues increased 3.1% compared to second quarter 2009 with the decline in service charge fees more than offset by a 15.1% increase in other service charges, commissions and fees (primarily merchant fee income), an 11.1% increase in card-based fees, and a 6.6% increase in trust and advisory fees.
Total noninterest income increased 12.3% from first quarter 2010 due to the bargain purchase gain stemming from the acquisition of Peotone Bank and Trust Company. Compared to second quarter 2009, total noninterest income decreased 13.0% as a result of differences in net securities gains, the fair value adjustment related to the Company’s non-qualified deferred compensation plan, in addition to the bargain purchase gain on the Peotone Bank and Trust Company transaction.
3
Total noninterest expense for second quarter 2010 increased approximately $2.0 million from first quarter 2010, due primarily to a $1.0 million increase in losses and write downs realized on other real estate owned, as well as a normal seasonal increase in marketing expenditures.
Total noninterest expense increased 13.9% in second quarter 2010 compared to second quarter 2009, substantially due to an $8.5 million increase in losses, write downs, and operating expenses associated with other real estate owned, $841 thousand in higher loan remediation costs (including costs to convert and value loans acquired in the FDIC-assisted transactions) as well as higher marketing, merchant processing, and technology costs. Such increases were partially offset by a $3.5 million decline in FDIC insurance premiums and a $1.7 million decline in salaries and benefits expense due primarily to the reduction in compensation related to the decline in fair value of assets underlying the non-qualified deferred compensation plan.
Acquisition of Peotone Bank and Trust Company
On April 23, 2010, the Company acquired certain loans and deposits of the former Peotone Bank and Trust Company in an FDIC-assisted transaction generating a pre-tax bargain purchase gain of $4.3 million. Loans comprise the majority of the assets acquired and are subject to a loss sharing arrangement with the FDIC whereby the Company is indemnified against the majority of any losses incurred related to these loans. The loans acquired from the former Peotone Bank and Trust Company, including the FDIC indemnification asset, total $53.1 million at June 30, 2010. These assets are excluded from the asset quality presentation in this release, given the loss share indemnification from the FDIC.
Asset Quality
Non-performing loans, excluding covered loans, represented 3.84% of total loans at June 30, 2010, compared to 4.31% and 4.93% at March 31, 2010 and June 30, 2009, respectively. Loans 30-89 days delinquent stood at $32.0 million, or 0.61% of total loans, approximating the March 31, 2010 level of $28.0 million.
The reserve for loan losses represented 2.79% of total loans outstanding at June 30, 2010, unchanged from March 31, 2010 and up from 2.39% at June 30, 2009. The reserve for loan losses as a percentage of non-performing loans, excluding covered loans, improved to 73% at June 30, 2010, compared to 65% at March 31, 2010 and 48% at June 30, 2009. Charge offs, excluding covered loans, for second quarter 2010 were $20.2 million compared to $18.3 million and $27.7 million for first quarter 2010 and second quarter 2009, respectively.
4
Other real estate owned was $57.0 million at June 30, 2010, compared to $62.6 million at March 31, 2010 and $50.6 million at June 30, 2009. The Company sold $21.6 million of OREO during second quarter 2010 at a loss of $5.5 million. OREO write-downs of $3.4 million were also recorded as the Company continues to align values with current market conditions.
Securities Portfolio
Approximately 95% of the Company’s $1.1 billion available-for-sale portfolio is comprised of municipals, collateralized mortgage obligations (“CMOs”), and agency pass-through securities. The remainder consists of trust-preferred collateralized debt obligation pools (“CDOs”) with a fair value of $13.7 million and an unrealized loss of $36.8 million, and miscellaneous other securities totaling $36.5 million. Net securities gains were $1.1 million for second quarter 2010 and were net of other-than-temporary impairment charges of $1.1 million primarily related to the Company’s CDOs.
5
Capital Management
As reflected in the following table, all regulatory mandated ratios for characterization as “well-capitalized” were exceeded as of June 30, 2010.
| June 30, 2010 | March 31, 2010 | Minimum “Well- Capitalized” Level | Excess Over Required Minimums at June 30, 2010 | ||||||||||||
| (Amounts in millions) | |||||||||||||||
Regulatory capital ratios: | |||||||||||||||
Total capital to risk-weighted assets | 17.31 | % | 17.23 | % | 10.00 | % | 73 | % | $ | 465 | |||||
Tier 1 capital to risk-weighted assets | 15.25 | % | 15.17 | % | 6.00 | % | 154 | % | $ | 588 | |||||
Tier 1 leverage to average assets | 12.69 | % | 13.06 | % | 5.00 | % | 154 | % | $ | 588 | |||||
Regulatory capital ratios, excluding preferred stock: | |||||||||||||||
Total capital to risk-weighted assets | 14.27 | % | 14.20 | % | 10.00 | % | 43 | % | $ | 272 | |||||
Tier 1 capital to risk-weighted assets | 12.21 | % | 12.14 | % | 6.00 | % | 104 | % | $ | 382 | |||||
Tier 1 leverage to average assets | 10.17 | % | 10.45 | % | 5.00 | % | 103 | % | $ | 382 | |||||
Tier 1 common capital to risk-weighted assets | 10.88 | % | 10.81 | % | N/A | N/A | N/A | ||||||||
Tangible equity ratios: | |||||||||||||||
Tangible common equity to tangible assets | 9.05 | % | 9.17 | % | N/A | N/A | N/A | ||||||||
Tangible common equity, excluding other comprehensive loss, to tangible assets | 9.22 | % | 9.42 | % | N/A | N/A | N/A | ||||||||
Tangible common equity to risk-weighted assets | 10.71 | % | 10.52 | % | N/A | N/A | N/A | ||||||||
The Board of Directors reviews the Company’s capital plan each quarter, giving consideration to the current and expected operating environment, as well as an evaluation of various capital alternatives.
6
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 98 offices located in 64 communities, primarily in metropolitan Chicago.
Safe Harbor Statement
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are not historical facts but instead represent only the Company’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of the Company’s control. It is possible that actual results and the Company’s financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. For a discussion of some of the risks and important factors that could affect the Company’s future results, see “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009 and other reports filed with the Securities and Exchange Commission. Forward-looking statements represent management’s best judgment as of the date hereof based on currently available information. Except as required by law, the Company undertakes no duty to update the contents of this press release after the date hereof.
Conference Call
A conference call to discuss the Company’s results, outlook and related matters will be held on Wednesday, July 21 2010 at 10:00 A.M. (ET). Members of the public who would like to listen to the conference call should dial (866) 800-8652 (U.S. domestic) or (617) 614-2705 (international) and enter passcode number 547 12 550. The number should be dialed 10 to 15 minutes prior to the start of the conference call. There is no charge to access the call. The conference call will also be accessible as an audio webcast through the Investor Relations section of the Company’s website,www.firstmidwest.com/investorrelations. For those unable to listen to the live broadcast, a replay will be available on the Company’s website or by dialing (888) 286-8010 (U.S. domestic) or (617) 801-6888 (international) passcode number 397 65 478 beginning at 1:00 P.M. (ET) on July 21, 2010 until 11:59 P.M. (ET) on July 28, 2010. Please direct any questions regarding obtaining access to the conference call to First Midwest Bancorp, Inc. Investor Relations, via e-mail, atinvestor.relations@firstmidwest.com.
7
Accompanying Financial Statements and Tables
Accompanying this press release is the following unaudited financial information:
| • | Operating Highlights, Balance Sheet Highlights, and Capital Ratios |
| • | Condensed Consolidated Statements of Financial Condition |
| • | Condensed Consolidated Statements of Income |
| • | Pre-Tax, Pre-Provision Core Operating Earnings |
| • | Loan Portfolio Composition |
| • | Asset Quality |
| • | Charge-off Data |
| • | Securities Available-for-Sale |
Press Release and Additional Information Available on Website
This press release, the accompanying financial statements and tables, and certain additional unauditedSelected Financial Information are available through the “Investor Relations” section of First Midwest’s website atwww.firstmidwest.com.
8
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Operating Highlights
Unaudited
(Dollar amounts in thousands except per share data)
| Quarters Ended | ||||||||||||
| June 30, 2010 | March 31, 2010 | June 30, 2009 | ||||||||||
Net income | $ | 7,809 | $ | 8,081 | $ | 2,663 | ||||||
Net income applicable to common shares | 5,171 | 5,428 | 63 | |||||||||
Diluted earnings per common share | $ | 0.07 | $ | 0.08 | $ | — | ||||||
Return on average common equity | 2.16 | % | 2.38 | % | 0.04 | % | ||||||
Return on average assets | 0.40 | % | 0.43 | % | 0.13 | % | ||||||
Net interest margin | 4.21 | % | 4.28 | % | 3.53 | % | ||||||
Efficiency ratio | 57.92 | % | 58.41 | % | 61.45 | % | ||||||
Balance Sheet Highlights
Unaudited
(Dollar amounts in thousands except per share data)
| As Of | |||||||||
| June 30, 2010 | March 31, 2010 | June 30, 2009 | |||||||
Total assets | $ | 7,805,089 | $ | 7,592,907 | $ | 7,767,312 | |||
Total loans, excluding covered loans | 5,208,347 | 5,195,874 | 5,340,771 | ||||||
Covered assets(1) | 251,572 | 207,609 | 0 | ||||||
Total deposits | 6,123,565 | 5,864,104 | 5,766,656 | ||||||
Total stockholders’ equity | 1,155,512 | 1,143,768 | 892,053 | ||||||
Common stockholders’ equity | 962,512 | 950,768 | 699,053 | ||||||
Book value per share | $ | 13.00 | $ | 12.84 | $ | 14.22 | |||
Period end shares outstanding | 74,049 | 74,046 | 49,161 | ||||||
| (1) | Covered assets are subject to a loss sharing agreement with the Federal Deposit Insurance Corporation (“FDIC”) whereby the Company is indemnified against the majority of any losses incurred related to these loans and other real estate owned. |
Capital Ratios
Unaudited
| As Of | |||||||||
| June 30, 2010 | March 31, 2010 | June 30, 2009 | |||||||
Regulatory capital ratios: | |||||||||
Total capital to risk-weighted assets | 17.31 | % | 17.23 | % | 15.21 | % | |||
Tier 1 capital to risk-weighted assets | 15.25 | % | 15.17 | % | 12.38 | % | |||
Tier 1 leverage to average assets | 12.69 | % | 13.06 | % | 9.87 | % | |||
Regulatory capital ratios, excluding preferred stock: | |||||||||
Total capital to risk-weighted assets | 14.27 | % | 14.20 | % | 12.17 | % | |||
Tier 1 capital to risk-weighted assets | 12.21 | % | 12.14 | % | 9.33 | % | |||
Tier 1 leverage to average assets | 10.17 | % | 10.45 | % | 7.44 | % | |||
Tier 1 common capital to risk-weighted assets | 10.88 | % | 10.81 | % | 7.36 | % | |||
Tangible common equity ratios: | |||||||||
Tangible common equity to tangible assets | 9.05 | % | 9.17 | % | 5.56 | % | |||
Tangible common equity, excluding other comprehensive loss, to tangible assets | 9.22 | % | 9.42 | % | 6.23 | % | |||
Tangible common equity to risk-weighted assets | 10.71 | % | 10.52 | % | 6.57 | % | |||
9
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Condensed Consolidated Statements of Financial Condition
Unaudited
(Amounts in thousands)
| June 30, | ||||||||
| 2010 | 2009 | |||||||
Assets | ||||||||
Cash and due from banks | $ | 136,982 | $ | 132,231 | ||||
Funds sold and other short-term investments | 236,098 | 7,723 | ||||||
Trading account securities, at fair value | 13,067 | 12,203 | ||||||
Securities available-for-sale, at fair value | 1,090,109 | 1,450,082 | ||||||
Securities held-to-maturity, at amortized cost | 87,843 | 86,245 | ||||||
Federal Home Loan Bank and Federal Reserve Bank stock, at cost | 59,864 | 54,768 | ||||||
Loans, excluding covered loans | 5,208,347 | 5,340,771 | ||||||
Covered loans(1) | 164,924 | — | ||||||
Reserve for loan losses | (145,027 | ) | (127,528 | ) | ||||
Net loans | 5,228,244 | 5,213,243 | ||||||
Other real estate owned (“OREO”), excluding covered assets | 57,023 | 50,640 | ||||||
Covered other real estate owned(1) | 10,657 | — | ||||||
FDIC indemnification asset(1) | 75,991 | — | ||||||
Premises, furniture, and equipment | 132,335 | 115,702 | ||||||
Investment in bank owned life insurance | 198,399 | 197,564 | ||||||
Goodwill and other intangible assets | 281,255 | 282,592 | ||||||
Accrued interest receivable and other assets | 197,222 | 164,319 | ||||||
Total assets | $ | 7,805,089 | $ | 7,767,312 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Deposits | ||||||||
Transactional deposits | $ | 4,218,383 | $ | 3,778,879 | ||||
Time deposits | 1,905,182 | 1,987,777 | ||||||
Total deposits | 6,123,565 | 5,766,656 | ||||||
Borrowed funds | 328,470 | 792,176 | ||||||
Subordinated debt | 137,739 | 232,342 | ||||||
Accrued interest payable and other liabilities | 59,803 | 84,085 | ||||||
Total liabilities | 6,649,577 | 6,875,259 | ||||||
Preferred stock | 190,553 | 189,921 | ||||||
Common stock | 858 | 613 | ||||||
Additional paid-in capital | 435,605 | 193,623 | ||||||
Retained earnings | 819,890 | 850,950 | ||||||
Accumulated other comprehensive loss | (12,803 | ) | (49,482 | ) | ||||
Treasury stock, at cost | (278,591 | ) | (293,572 | ) | ||||
Total stockholders’ equity | 1,155,512 | 892,053 | ||||||
Total liabilities and stockholders’ equity | $ | 7,805,089 | $ | 7,767,312 | ||||
| (1) | Total covered assets equal $251,572 and are comprised of covered loans, covered OREO, and an FDIC indemnification asset. |
10
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Condensed Consolidated Statements of Income
Unaudited
(Amounts in thousands, except per share data)
| Quarters Ended | ||||||||||||
| June 30, 2010 | March 31, 2010 | June 30, 2009 | ||||||||||
Interest Income | ||||||||||||
Loans | $ | 65,439 | $ | 64,480 | $ | 64,071 | ||||||
Securities | 13,699 | 13,952 | 20,678 | |||||||||
Covered assets, excluding covered OREO | 2,598 | 2,962 | — | |||||||||
Other | 538 | 385 | 390 | |||||||||
Total interest income | 82,274 | 81,779 | 85,139 | |||||||||
Interest Expense | ||||||||||||
Deposits | 9,626 | 10,545 | 17,152 | |||||||||
Borrowed funds | 749 | 1,010 | 3,893 | |||||||||
Subordinated debt | 2,280 | 2,286 | 3,703 | |||||||||
Total interest expense | 12,655 | 13,841 | 24,748 | |||||||||
Net interest income | 69,619 | 67,938 | 60,391 | |||||||||
Provision for loan losses | 21,526 | 18,350 | 36,262 | |||||||||
Net interest income after provision for loan losses | 48,093 | 49,588 | 24,129 | |||||||||
Noninterest Income | ||||||||||||
Service charges on deposit accounts | 9,052 | 8,381 | 9,687 | |||||||||
Trust and investment management fees | 3,702 | 3,593 | 3,471 | |||||||||
Other service charges, commissions, and fees | 4,628 | 4,172 | 4,021 | |||||||||
Card-based fees | 4,497 | 3,893 | 4,048 | |||||||||
Subtotal, fee-based revenues | 21,879 | 20,039 | 21,227 | |||||||||
Bank owned life insurance income | 349 | 248 | 1,159 | |||||||||
Securities gains, net | 1,121 | 3,057 | 6,635 | |||||||||
Gain on FDIC-assisted transaction | 4,303 | — | — | |||||||||
Other | (342 | ) | 977 | 2,373 | ||||||||
Total noninterest income | 27,310 | 24,321 | 31,394 | |||||||||
Noninterest Expense | ||||||||||||
Salaries and employee benefits | 26,540 | 26,884 | 28,229 | |||||||||
FDIC insurance | 2,546 | 2,532 | 6,034 | |||||||||
Net occupancy expense | 5,657 | 6,040 | 5,194 | |||||||||
Losses realized on other real estate owned | 8,924 | 7,879 | 2,387 | |||||||||
Other real estate owned expense, net | 2,926 | 2,908 | 914 | |||||||||
Loan remediation expense | 1,836 | 2,001 | 995 | |||||||||
Other professional fees | 3,816 | 4,539 | 2,730 | |||||||||
Other | 15,210 | 12,690 | 12,750 | |||||||||
Total noninterest expense | 67,455 | 65,473 | 59,233 | |||||||||
Income (loss) before taxes | 7,948 | 8,436 | (3,710 | ) | ||||||||
Income tax expense (benefit) | 139 | 355 | (6,373 | ) | ||||||||
Net income | 7,809 | 8,081 | 2,663 | |||||||||
Preferred dividends | (2,573 | ) | (2,572 | ) | (2,566 | ) | ||||||
Net income applicable to non-vested restricted shares | (65 | ) | (81 | ) | (34 | ) | ||||||
Net Income Applicable to Common Shares | $ | 5,171 | $ | 5,428 | $ | 63 | ||||||
Diluted Earnings Per Common Share | $ | 0.07 | $ | 0.08 | $ | — | ||||||
Dividends Declared Per Common Share | $ | 0.01 | $ | 0.01 | $ | 0.01 | ||||||
Weighted Average Diluted Common Shares Outstanding | 73,028 | 70,469 | 48,501 | |||||||||
11
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Pre-Tax, Pre-Provision Core Operating Earnings(1)
Unaudited
(Dollar amounts in thousands)
| Quarters Ended | ||||||||||||
| June 30, 2010 | March 31, 2010 | June 30, 2009 | ||||||||||
Income (loss) before taxes | $ | 7,948 | $ | 8,436 | $ | (3,710 | ) | |||||
Provision for loan losses | 21,526 | 18,350 | 36,262 | |||||||||
Pre-tax, pre-provision earnings | 29,474 | 26,786 | 32,552 | |||||||||
Non-Operating Items | ||||||||||||
Securities gains (losses), net | 1,121 | 3,057 | 6,635 | |||||||||
Gains on FDIC-assisted transaction | 4,303 | — | — | |||||||||
Losses realized on other real estate owned | (8,924 | ) | (7,879 | ) | (2,387 | ) | ||||||
FDIC special deposit insurance assessment | — | — | (3,500 | ) | ||||||||
Total non-operating items | (3,500 | ) | (4,822 | ) | 748 | |||||||
Pre-tax, pre-provision core operating earnings | $ | 32,974 | $ | 31,608 | $ | 31,804 | ||||||
Risk-weighted assets | $ | 6,362,015 | $ | 6,381,679 | $ | 6,335,010 | ||||||
Pre-tax, pre-provision core operating earnings to risk-weighted assets | 2.07 | % | 1.98 | % | 2.01 | % | ||||||
| (1) | The Company’s accounting and reporting policies conform to U.S. generally accepted accounting principles (“GAAP”) and general practice within the banking industry. As a supplement to GAAP, the Company has provided this non-GAAP performance result. The Company believes that this non-GAAP financial measure is useful because it allows investors to assess the Company’s operating performance. Although this non-GAAP financial measure is intended to enhance investors’ understanding of the Company’s business and performance, this non-GAAP financial measure should not be considered an alternative to GAAP. |
12
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Loan Portfolio Composition, Excluding Covered Loans
Unaudited
(Dollar amounts in thousands)
| As Of | Percent Change From | |||||||||||||||||
| 6/30/10 | % of Total | 3/31/10 | 6/30/09 | 3/31/10 | 6/30/09 | |||||||||||||
Commercial and industrial | $ | 1,494,119 | 28.7 | % | $ | 1,454,714 | $ | 1,457,413 | 2.7 | % | 2.5 | % | ||||||
Agricultural and farmland | 199,597 | 3.8 | % | 200,527 | 210,675 | (0.5 | %) | (5.3 | %) | |||||||||
Commercial real estate: | ||||||||||||||||||
Office, retail, and industrial | 1,220,191 | 23.4 | % | 1,239,583 | 1,117,748 | (1.6 | %) | 9.2 | % | |||||||||
Construction: | ||||||||||||||||||
Residential construction and land | 241,094 | 4.6 | % | 276,322 | 458,913 | (12.7 | %) | (47.5 | %) | |||||||||
Commercial construction and land | 202,041 | 3.9 | % | 233,662 | 325,425 | (13.5 | %) | (37.9 | %) | |||||||||
Total construction | 443,135 | 8.5 | % | 509,984 | 784,338 | (13.1 | %) | (43.5 | %) | |||||||||
Multifamily | 369,281 | 7.1 | % | 348,178 | 305,976 | 6.1 | % | 20.7 | % | |||||||||
Investor-owned rental property | 120,436 | 2.3 | % | 121,040 | 132,173 | (0.5 | %) | (8.9 | %) | |||||||||
Other commercial real estate | 711,287 | 13.7 | % | 669,462 | 626,959 | 6.2 | % | 13.5 | % | |||||||||
Total commercial real estate | 2,864,330 | 55.0 | % | 2,888,247 | 2,967,194 | (0.8 | %) | (3.5 | %) | |||||||||
Consumer: | ||||||||||||||||||
Home equity | 458,066 | 8.8 | % | 464,655 | 480,706 | (1.4 | %) | (4.7 | %) | |||||||||
Real estate 1-4 family | 145,457 | 2.8 | % | 139,840 | 171,186 | 4.0 | % | (15.0 | %) | |||||||||
Other consumer | 46,778 | 0.9 | % | 47,891 | 53,597 | (2.3 | %) | (12.7 | %) | |||||||||
Total consumer | 650,301 | 12.5 | % | 652,386 | 705,489 | (0.3 | %) | (7.8 | %) | |||||||||
Total loans, excluding covered loans | $ | 5,208,347 | 100.0 | % | $ | 5,195,874 | $ | 5,340,771 | 0.2 | % | (2.5 | %) | ||||||
Office, Retail, and Industrial | ||||||||||||||||||
Office | $ | 415,846 | 34.1 | % | $ | 396,749 | $ | 356,946 | 4.8 | % | 16.5 | % | ||||||
Retail | 310,819 | 25.5 | % | 346,218 | 297,829 | (10.2 | %) | 4.4 | % | |||||||||
Industrial | 493,526 | 40.4 | % | 496,616 | 462,973 | (0.6 | %) | 6.6 | % | |||||||||
Total office, retail, and industrial | $ | 1,220,191 | 100.0 | % | $ | 1,239,583 | $ | 1,117,748 | (1.6 | %) | 9.2 | % | ||||||
13
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Asset Quality, Excluding Covered Assets
Unaudited
(Dollar amounts in thousands)
| As Of | ||||||||||||||||||
| 6/30/10 | % of Loan Category | % of Total | 3/31/10 | 6/30/09 | ||||||||||||||
Non-accrual loans: | ||||||||||||||||||
Commercial and industrial | $ | 39,942 | 2.67 | % | 20.6 | % | $ | 38,095 | $ | 41,542 | ||||||||
Agricultural and farmland | 1,139 | 0.57 | % | 0.6 | % | 2,532 | 452 | |||||||||||
Office, retail, and industrial | 17,170 | 1.41 | % | 8.9 | % | 18,204 | 13,058 | |||||||||||
Residential construction and land | 71,148 | 29.51 | % | 36.7 | % | 93,412 | 143,231 | |||||||||||
Commercial construction and land | 20,457 | 10.13 | % | 10.6 | % | 20,023 | 3,833 | |||||||||||
Multi-family | 7,904 | 2.14 | % | 4.1 | % | 8,349 | 10,632 | |||||||||||
Investor-owned rental property | 6,083 | 5.05 | % | 3.1 | % | 5,947 | 2,787 | |||||||||||
Other commercial real estate | 15,867 | 2.23 | % | 8.2 | % | 15,859 | 14,642 | |||||||||||
Consumer | 13,979 | 2.15 | % | 7.2 | % | 13,652 | 7,076 | |||||||||||
Total non-accrual loans, excluding covered loans | 193,689 | 3.72 | % | 100.0 | % | 216,073 | 237,253 | |||||||||||
90 days past due loans (still accruing interest): | ||||||||||||||||||
Commercial and industrial | 2,209 | 0.15 | % | 35.2 | % | 3,938 | 7,174 | |||||||||||
Agricultural and farmland | — | 0.00 | % | 0 | % | — | 1,931 | |||||||||||
Office, retail, and industrial | 1,550 | 0.13 | % | 24.7 | % | 676 | 1,013 | |||||||||||
Residential construction and land | — | 0 | % | 0 | % | — | 5,022 | |||||||||||
Commercial construction and land | — | 0 | % | 0 | % | — | 881 | |||||||||||
Multi-family | — | 0 | % | 0 | % | 368 | 699 | |||||||||||
Investor-owned rental property | 116 | 0.10 | % | 1.8 | % | 201 | 592 | |||||||||||
Other commercial real estate | 1,387 | 0.19 | % | 22.1 | % | 23 | 1,154 | |||||||||||
Consumer | 1,018 | 0.16 | % | 16.2 | % | 2,789 | 7,605 | |||||||||||
Total 90 days past due loans | 6,280 | 0.12 | % | 100.0 | % | 7,995 | 26,071 | |||||||||||
Total non-performing loans, excluding covered loans | 199,969 | 224,068 | 263,324 | |||||||||||||||
Restructured loans, still accruing | 9,030 | 5,168 | 18,877 | |||||||||||||||
OREO, excluding covered OREO | 57,023 | 62,565 | 50,640 | |||||||||||||||
Total non-performing assets, excluding covered assets | $ | 266,022 | $ | 291,801 | $ | 332,841 | ||||||||||||
30-89 days past due loans | $ | 32,012 | $ | 28,018 | $ | 38,128 | ||||||||||||
Reserve for loan losses and unfunded commitments | $ | 145,477 | $ | 144,824 | $ | 127,528 | ||||||||||||
Asset Quality Ratios, Excluding Covered Assets | ||||||||||||||||||
Non-accrual loans to loans | 3.72 | % | 4.16 | % | 4.44 | % | ||||||||||||
Non-performing loans to loans | 3.84 | % | 4.31 | % | 4.93 | % | ||||||||||||
Non-performing assets to loans plus OREO | 5.05 | % | 5.55 | % | 6.17 | % | ||||||||||||
Reserve for loan losses to loans | 2.79 | % | 2.79 | % | 2.39 | % | ||||||||||||
Reserve for loan losses to non-accrual loans | 75 | % | 67 | % | 54 | % | ||||||||||||
Reserve for loan losses to non-performing loans | 73 | % | 65 | % | 48 | % | ||||||||||||
14
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Charge-off Data, Excluding Charge-offs on Covered Loans
Unaudited
(Dollar amounts in thousands)
| Quarters Ended | ||||||||||||||||||
| 6/30/10 | % of Loan Category | % of Total | 3/31/10 | 6/30/09 | ||||||||||||||
Net loans charged-off: | ||||||||||||||||||
Commercial and industrial | $ | 2,679 | 0.18 | % | 13.2 | % | $ | 4,463 | $ | 7,006 | ||||||||
Agricultural and farmland | 546 | 0.27 | % | 2.7 | % | 141 | — | |||||||||||
Office, retail, and industrial | 2,353 | 0.19 | % | 11.6 | % | 1,644 | 217 | |||||||||||
Residential construction and land | 9,994 | 4.15 | % | 49.4 | % | 4,452 | 8,427 | |||||||||||
Commercial construction and land | 115 | 0.06 | % | 0.6 | % | 270 | 734 | |||||||||||
Multifamily | 485 | 0.13 | % | 2.4 | % | 512 | 1,086 | |||||||||||
Investor-owned rental property | 982 | 0.82 | % | 4.9 | % | 254 | 12 | |||||||||||
Other commercial real estate | 525 | 0.07 | % | 2.6 | % | 4,195 | 2,451 | |||||||||||
Consumer | 2,543 | 0.39 | % | 12.6 | % | 2,403 | 4,802 | |||||||||||
Total net loans charged-off, excluding covered assets | $ | 20,222 | 0.39 | % | 100.0 | % | $ | 18,334 | $ | 24,735 | ||||||||
Net loan charge-offs, excluding covered charge-offs to average loans, annualized: | ||||||||||||||||||
Quarter-to-date | 1.56 | % | — | — | 1.43 | % | 1.85 | % | ||||||||||
Year-to-date | 1.49 | % | — | — | 1.43 | % | 1.91 | % | ||||||||||
15
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Covered Assets(1)
Unaudited
(Dollar amounts in thousands)
| As Of | |||||||||
| June 30, 2010 | March 31, 2010 | December 31, 2009 | |||||||
Loans | $ | 164,924 | $ | 144,369 | $ | 146,319 | |||
Other real estate owned | 10,657 | 8,649 | 8,981 | ||||||
FDIC indemnification asset | 75,991 | 54,591 | 67,945 | ||||||
Total covered assets | $ | 251,572 | $ | 207,609 | $ | 223,245 | |||
90 days or more past due loans | $ | 47,912 | $ | 52,464 | $ | 30,286 | |||
30-89 days past due loans | $ | 13,725 | $ | 10,175 | $ | 22,988 | |||
Net charge-offs – quarter to date | $ | 651 | $ | 0 | $ | 0 | |||
| (1) | Covered assets are subject to a loss sharing agreement with the Federal Deposit Insurance Corporation (“FDIC”) whereby the Company is indemnified against the majority of any losses incurred related to these loans and other real estate owned. |
16
| First Midwest Bancorp, Inc. | Press Release Dated July 21, 2010 |
Securities Available-For-Sale
Unaudited
(Dollar amounts in thousands)
| U.S. Treasury and Agency | Collateralized Mortgage Obligations | Other Mortgage Backed | State and Municipal | Collateralized Debt Obligations | Other | Total | ||||||||||||||||||||||
As of June 30, 2010 | ||||||||||||||||||||||||||||
Amortized cost | $ | 9,919 | $ | 264,240 | $ | 119,933 | $ | 622,268 | $ | 50,547 | $ | 34,966 | $ | 1,101,873 | ||||||||||||||
Gross unrealized gains (losses): | ||||||||||||||||||||||||||||
Gross unrealized gains | 12 | 7,055 | 7,779 | 13,413 | 0 | 1,734 | 29,993 | |||||||||||||||||||||
Gross unrealized losses | (1 | ) | (1,582 | ) | (19 | ) | (3,079 | ) | (36,883 | ) | (193 | ) | (41,757 | ) | ||||||||||||||
Net unrealized gains (losses) | 11 | 5,473 | 7,760 | 10,334 | (36,883 | ) | 1,541 | (11,764 | ) | |||||||||||||||||||
Fair value | $ | 9,930 | $ | 269,713 | $ | 127,693 | $ | 632,602 | $ | 13,664 | $ | 36,507 | $ | 1,090,109 | ||||||||||||||
As of March 31, 2010 | ||||||||||||||||||||||||||||
Amortized cost | $ | 755 | $ | 269,457 | $ | 181,953 | $ | 635,036 | $ | 51,596 | $ | 34,949 | $ | 1,173,746 | ||||||||||||||
Gross unrealized gains (losses): | ||||||||||||||||||||||||||||
Gross unrealized gains | 1 | 8,807 | 8,533 | 8,046 | — | 1,177 | 26,564 | |||||||||||||||||||||
Gross unrealized losses | — | (1,761 | ) | (29 | ) | (6,666 | ) | (39,418 | ) | (397 | ) | (48,271 | ) | |||||||||||||||
Net unrealized gains (losses) | 1 | 7,046 | 8,504 | 1,380 | (39,418 | ) | 780 | (21,707 | ) | |||||||||||||||||||
Fair value | $ | 756 | $ | 276,503 | $ | 190,457 | $ | 636,416 | $ | 12,178 | $ | 35,729 | $ | 1,152,039 | ||||||||||||||
As of June 30, 2009 | ||||||||||||||||||||||||||||
Amortized cost | $ | — | $ | 382,526 | $ | 221,481 | $ | 767,856 | $ | 71,789 | $ | 59,646 | $ | 1,503,298 | ||||||||||||||
Gross unrealized gains (losses): | ||||||||||||||||||||||||||||
Gross unrealized gains | — | 8,349 | 6,786 | 4,907 | — | 140 | 20,182 | |||||||||||||||||||||
Gross unrealized losses | — | (3,456 | ) | (15 | ) | (14,778 | ) | (51,474 | ) | (3,675 | ) | (73,398 | ) | |||||||||||||||
Net unrealized gains (losses) | — | 4,893 | 6,771 | (9,871 | ) | (51,474 | ) | (3,535 | ) | (53,216 | ) | |||||||||||||||||
Fair value | $ | — | $ | 387,419 | $ | 228,252 | $ | 757,985 | $ | 20,315 | $ | 56,111 | $ | 1,450,082 | ||||||||||||||
17