Exhibit 99.1
Contact: Mark E. Secor
Chief Financial Officer
Phone: (219) 873-2611
Fax: (219) 874-9280
Date: January 22, 2015
FOR IMMEDIATE RELEASE
Horizon Bancorp Announces 2014 Earnings
Michigan City, Indiana (NASDAQ GM: HBNC) – Horizon Bancorp today announced its unaudited financial results for the three and twelve-month periods ended December 31, 2014.
SUMMARY:
| · | Assets surpassed $2.0 billion during 2014, ending the year at $2.1 billion as of December 31, 2014. |
| · | Net income for the year ending December 31, 2014 was $18.1 million or $1.90 diluted earnings per share. |
| · | Fourth quarter 2014 net income was $4.9 million or $.51 diluted earnings per share. |
| · | Total loans, excluding mortgage warehouse loans, increased 28.9% or $281.6 million during the year ended December 31, 2014. |
| · | The quarterly dividend was increased twice during the year ended December 31, 2014 from 11 cents to 13 cents in the second quarter and to 14 cents in the fourth quarter. |
| · | Return on average assets was 0.96% for the fourth quarter of 2014 and 0.93% for the year ending December 31, 2014. |
| · | Return on average common equity was 10.72% for the fourth quarter of 2014 and 10.60% for the year ending December 31, 2014. |
| · | Non-performing loans to total loans as of December 31, 2014 were 1.62% compared to 1.70% as of December 31, 2013. |
| · | Substandard loans totaled $27.7 million as of December 31, 2014, a decrease of $7.1 million from $34.7 million as of December 31, 2013. |
| · | Horizon’s full-service Carmel, Indiana office is expected to open in February of 2015. |
Craig M. Dwight, Chairman and CEO, commented: “I am pleased to announce Horizon’s 2014 results, a year in which tremendous progress was made across the company. Headlining the year is the growth we achieved throughout the loan portfolio and the successful integration of the Summit Community Bank (“Summit”) acquisition in East Lansing, Michigan. All loan product types experienced significant growth during the year, allowing us to combat industry-wide net interest
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Pg. 2 cont. Horizon Bancorp Announces 2014 Earnings
margin pressure. Additionally, the increase in assets from both organic loan growth and the Summit acquisition enabled us to spread operating costs across a larger and more diversified revenue stream.”
Dwight continued, “Excluding one-time expenses related to the Summit acquisition, the decrease in income from acquisition-related purchase accounting adjustments and gains on the sale of investment securities, Horizon’s net income and diluted earnings per share increased by 6.4% and 3.0%, respectively, for the year ended December 31, 2014 compared to the previous year. This increase is a notable accomplishment given the lower mortgage volume and poor weather conditions which decreased net income and earnings per share during the first quarter of 2014. The increase in core net income and diluted earnings per share illustrate the incremental operating leverage Horizon achieved through our strategic growth initiative. We believe our investments in technology, new markets, and talented employees have created a solid base to maintain this momentum into 2015.”
Non-GAAP Reconciliation of Net Income and Diluted Earnings per Share
(Dollar Amounts in Thousands Except per Share Data)
| | | Three Months Ended | | | Twelve Months Ended | |
| | | December 31 | | | December 31 | |
| | | 2014 | | | 2013 | | | 2014 | | | 2013 | |
| | | (Unaudited) | | | | | | (Unaudited) | | | | |
| Non-GAAP Reconciliation of Net Income | | | | | | | | | | | | |
| Net income as reported | | $ | 4,948 | | | $ | 4,115 | | | $ | 18,101 | | | $ | 19,876 | |
| Summit expenses | | | - | | | | - | | | | 1,335 | | | | - | |
| Tax effect | | | - | | | | - | | | | (467 | ) | | | - | |
| Net income excluding Summit expenses | | $ | 4,948 | | | $ | 4,115 | | | $ | 18,969 | | | $ | 19,876 | |
| | | | | | | | | | | | | | | | | |
| Acquisition related purchase accounting adjustments ("PAUs") | | | (719 | ) | | | (850 | ) | | | (2,745 | ) | | | (6,294 | ) |
| Tax effect | | | 252 | | | | 298 | | | | 961 | | | | 2,203 | |
| Net income excluding Summit expenses and PAUs | | $ | 4,481 | | | $ | 3,563 | | | $ | 17,185 | | | $ | 15,785 | |
| | | | | | | | | | | | | | | | | |
| Gain on sale of investment securities | | | - | | | | - | | | | (988 | ) | | | (374 | ) |
| Tax effect | | | - | | | | - | | | | 346 | | | | 131 | |
| Net income excluding gain on sale of investment securities | | $ | 4,481 | | | $ | 3,563 | | | $ | 16,543 | | | $ | 15,542 | |
| | | | | | | | | | | | | | | | | |
| Non-GAAP Reconciliation of Diluted Earnings per Share | | | | | | | | | | | | | | | | |
| Diluted earnings per share as reported | | $ | 0.51 | | | $ | 0.45 | | | $ | 1.90 | | | $ | 2.17 | |
| Summit expenses | | | - | | | | - | | | | 0.14 | | | | - | |
| Tax effect | | | - | | | | - | | | | (0.05 | ) | | | - | |
| Diluted earnings per share excluding Summit expenses | | $ | 0.51 | | | $ | 0.45 | | | $ | 1.99 | | | $ | 2.17 | |
| | | | | | | | | | | | | | | | | |
| Acquisition related PAUs | | | (0.07 | ) | | | (0.09 | ) | | | (0.29 | ) | | | (0.70 | ) |
| Tax effect | | | 0.03 | | | | 0.03 | | | | 0.10 | | | | 0.24 | |
| Diluted earnings per share excluding Summit expenses and PAUs | | $ | 0.46 | | | $ | 0.39 | | | $ | 1.80 | | | $ | 1.71 | |
| | | | | | | | | | | | | | | | | |
| Gain on sale of investment securities | | | - | | | | - | | | | (0.10 | ) | | | (0.04 | ) |
| Tax effect | | | - | | | | - | | | | 0.04 | | | | 0.01 | |
| Net income excluding gain on sale of investment securities | | $ | 0.46 | | | $ | 0.39 | | | $ | 1.74 | | | $ | 1.69 | |
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The following tables present the amount and growth rate of loans by product type for the three and twelve months ended December 31, 2014.
Loan Growth by Type
Three Months Ended December 31, 2014
(Dollars in Thousands)
| | | | | | | | | | | | | | | Annualized | |
| | | December 31 | | | September 30 | | | Amount | | | Percent | | | Percent | |
| | | 2014 | | | 2014 | | | Change | | | Change | | | Change | |
| | | (Unaudited) | | | (Unaudited) | | | | | | | | | | |
| Commercial loans | | $ | 674,314 | | | $ | 677,349 | | | $ | (3,035 | ) | | | -0.4 | % | | | -1.8 | % |
| Residential mortgage loans | | | 254,625 | | | | 251,739 | | | | 2,886 | | | | 1.1 | % | | | 4.5 | % |
| Consumer loans | | | 320,459 | | | | 308,800 | | | | 11,659 | | | | 3.8 | % | | | 15.0 | % |
| Held for sale loans | | | 6,143 | | | | 4,167 | | | | 1,976 | | | | 47.4 | % | | | 188.1 | % |
| Subtotal | | | 1,255,541 | | | | 1,242,055 | | | | 13,486 | | | | 1.1 | % | | | 4.3 | % |
| Mortgage warehouse loans | | | 129,156 | | | | 105,133 | | | | 24,023 | | | | 22.9 | % | | | 90.7 | % |
| Total loans | | $ | 1,384,697 | | | $ | 1,347,188 | | | $ | 37,509 | | | | 2.8 | % | | | 11.0 | % |
| | | | | | | | | | | | | | | | | | | | | |
Loan Growth by Type
Twelve Months Ended December 31, 2014
(Dollars in Thousands)
| | | | | | | | | | | | | | | Annualized | |
| | | December 31 | | | December 31 | | | Amount | | | Percent | | | Percent | |
| | | 2014 | | | 2013 | | | Change | | | Change | | | Change | |
| | | (Unaudited) | | | | | | | | | | | | | |
| Commercial loans | | $ | 674,314 | | | $ | 505,189 | | | $ | 169,125 | | | | 33.5 | % | | | 33.5 | % |
| Residential mortgage loans | | | 254,625 | | | | 185,958 | | | | 68,667 | | | | 36.9 | % | | | 36.9 | % |
| Consumer loans | | | 320,459 | | | | 279,525 | | | | 40,934 | | | | 14.6 | % | | | 14.6 | % |
| Held for sale loans | | | 6,143 | | | | 3,281 | | | | 2,862 | | | | 87.2 | % | | | 87.2 | % |
| Subtotal | | | 1,255,541 | | | | 973,953 | | | | 281,588 | | | | 28.9 | % | | | 28.9 | % |
| Mortgage warehouse loans | | | 129,156 | | | | 98,156 | | | | 31,000 | | | | 31.6 | % | | | 31.6 | % |
| Total loans | | $ | 1,384,697 | | | $ | 1,072,109 | | | $ | 312,588 | | | | 29.2 | % | | | 29.2 | % |
“The resiliency of our net interest margin throughout the year illustrates the positive impact our loan growth has made,” Dwight continued. “Horizon’s core net interest margin, excluding income from acquisition-related purchase accounting adjustments, increased from 3.39% in the fourth quarter of 2013 to 3.48% in the fourth quarter of 2014. For the year ended December 31, 2014, the net interest margin decreased only 10 basis points to 3.47% in an environment with margin pressure persisting throughout the banking industry.”
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Pg. 4 cont. Horizon Bancorp Announces 2014 Earnings
| Non-GAAP Reconciliation of Net Interest Margin | |
| (Dollar Amounts in Thousands) | |
| | | Three Months Ended | | | Twelve Months Ended | |
| | | December 31 | | | September | | | December 31 | | | December 31 | |
| | | 2014 | | | 2014 | | | 2013 | | | 2014 | | | 2013 | |
| | | (Unaudited) | | | (Unaudited) | | | | | | (Unaudited) | | | | |
| Net Interest Margin As Reported | | | | | | | | | | | | | | | |
| Net interest income | | $ | 16,523 | | | $ | 16,400 | | | $ | 14,129 | | | $ | 62,983 | | | $ | 61,383 | |
| Average interest-earning assets | | | 1,865,750 | | | | 1,877,066 | | | | 1,616,461 | | | | 1,794,263 | | | | 1,617,028 | |
| Net interest income as a percent of average interest-earning assets | | | 3.64 | % | | | 3.59 | % | | | 3.60 | % | | | 3.62 | % | | | 3.96 | % |
| | | | | | | | | | | | | | | | | | | | | |
| Impact of Acquisitions | | | | | | | | | | | | | | | | | | | | |
| Interest income from acquisition-related purchase accounting adjustments | | $ | (719 | ) | | $ | (438 | ) | | $ | (850 | ) | | $ | (2,745 | ) | | $ | (6,294 | ) |
| | | | | | | | | | | | | | | | | | | | | |
| Net Interest Margin Excluding Impact of Acquisitions | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | $ | 15,804 | | | $ | 15,962 | | | $ | 13,279 | | | $ | 60,238 | | | $ | 55,089 | |
| Average interest-earning assets | | | 1,865,750 | | | | 1,877,066 | | | | 1,616,461 | | | | 1,794,263 | | | | 1,617,028 | |
| Net interest income as a percent of average interest-earning assets | | | 3.49 | % | | | 3.50 | % | | | 3.39 | % | | | 3.47 | % | | | 3.57 | % |
Dwight commented on the increase in provision for loan losses in the fourth quarter and for the year ending December 31, 2014 compared to the same periods of the previous year. “This increase reflects loan growth as well as a loan loss reserve to loan ratio in-line with current credit conditions. Non-performing loans increased $2.7 million during the fourth quarter; however, total substandard loans decreased by $7.3 million from $35.0 million as of September 30, 2014 to $27.7 million as of December 31, 2014. The increase in non-performing loans was due to one commercial real estate loan totaling $5.4 million that was moved to non-accrual status during the fourth quarter of 2014. Credit conditions continue to improve across the portfolio.”
Horizon’s loan loss reserve ratio, excluding loans with credit-related purchase accounting adjustments, stood at 1.29% as of December 31, 2014.
| Allowance for Loan and Lease Loss Detail | |
| As of December 31, 2014 | |
| (Dollars in Thousands, Unaudited) | |
| | | | | | | | | | | | | |
| | | Horizon | | | | | | | | | | |
| | | Legacy | | | Heartland | | | Summit | | | Total | |
| Pre-discount loan balance | | $ | 1,249,443 | | | $ | 36,489 | | | $ | 100,000 | | | $ | 1,385,932 | |
| | | | | | | | | | | | | | | | | |
| Allowance for loan losses (ALLL) | | | 16,177 | | | | 289 | | | | 35 | | | | 16,501 | |
| Loan discount | | | N/A | | | | 2,734 | | | | 4,644 | | | | 7,378 | |
| Total ALLL+loan discount | | | 16,177 | | | | 3,023 | | | | 4,679 | | | | 23,879 | |
| | | | | | | | | | | | | | | | | |
| Loans, net | | $ | 1,233,266 | | | $ | 33,466 | | | $ | 95,321 | | | $ | 1,362,053 | |
| | | | | | | | | | | | | | | | | |
| ALLL/ pre-discount loan balance | | | 1.29 | % | | | 0.79 | % | | | 0.04 | % | | | 1.19 | % |
| Loan discount/ pre-discount loan balance | | | N/A | | | | 7.49 | % | | | 4.64 | % | | | 0.53 | % |
| Total ALLL+loan discount/ pre-discount loan balance | | | 1.29 | % | | | 8.28 | % | | | 4.68 | % | | | 1.72 | % |
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Pg. 5 cont. Horizon Bancorp Announces 2014 Earnings
Dwight concluded, “Horizon’s four key revenue sources – business banking, retail banking, residential mortgage lending and wealth management – all made positive contributions to our 2014 results. We remain focused on continuing this trend in 2015 in an effort to increase profitability and build shareholder value.”
Income Statement Highlights
Net income for the fourth quarter of 2014 was $4.9 million or $.51 diluted earnings per share compared to $4.1 million or $.45 diluted earnings per share in the fourth quarter of 2013. The increase in net income from the previous year reflects an increase in interest income primarily due to loan growth and an increase in non-interest income due to an increase in gain on sale of loans, interchange fees and fiduciary activities partially offset by an increase in the provision expense.
Net income for the year ended December 31, 2014 was $18.1 million or $1.90 diluted earnings per share compared to $19.9 million or $2.17 diluted earnings per share for the year ended December 31, 2013. The decrease in net income compared to the previous year was due to $1.3 million in expenses related to the Summit acquisition in 2014 and a decrease of $3.5 million in income from acquisition-related purchase accounting adjustments partially offset by an increase of $614,000 in income from the gain on sale of investment securities. Excluding these non-core items, net income for the year ending December 31, 2014 increased $998,000 or 6.4% to $16.5 million compared to $15.5 million in the previous year.
Horizon’s net interest margin was 3.64% during the fourth quarter of 2014, up from 3.59% for the prior quarter and 3.60% for same period of 2013. The increase in net interest margin compared to the prior quarter was due to acquisition-related purchase accounting adjustments and lower funding costs, and the increase compared to the same period of 2013 was primarily due to loan growth. Excluding purchase accounting adjustments related to the 2012 Heartland Bancshares, Inc. and the 2014 Summit acquisitions, the margin would have been 3.48% for the fourth quarter of 2014 compared to 3.50% for the prior quarter and 3.39% for the same period of the prior year. Interest income from acquisition-related purchase accounting adjustments was $719,000, $438,000, and $850,000 for the three months ended December 31, 2014, September 30, 2014 and December 31, 2013, respectively.
Horizon’s net interest margin was 3.62% for the year ending December 31, 2014, down from 3.96% for the year ending December 31, 2013. Excluding interest income from acquisition-related purchase accounting adjustments, the margin would have been 3.47% for the twelve months ending December 31, 2014 compared to 3.57% for same period of 2013. Interest income from acquisition-related purchase accounting adjustments was $2.7 million and $6.3 million for the twelve months ended December 31, 2014 and December 31, 2013, respectively.
Residential mortgage lending activity during the fourth quarter of 2014 generated $2.3 million in income from the gain on sale of mortgage loans, an increase of $1.1 million from the fourth quarter of 2013. Total origination volume in the fourth quarter of 2014, including loans placed into portfolio, totaled $96.0 million, representing an increase of 36.4% from the fourth quarter of 2013 of $70.4 million. Purchase money mortgage originations during the fourth quarter of 2014
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Pg. 6 cont. Horizon Bancorp Announces 2014 Earnings
represented 67.6% of total originations compared to 77.6% of originations during the previous quarter and 75.6% during the fourth quarter of 2013.
Lending Activity
Total loans increased $312.6 million from $1.1 billion as of December 31, 2013 to $1.4 billion as of December 31, 2014 as mortgage warehouse loans increased by $31.0 million, residential mortgage loans increased by $68.7 million and consumer loans increased by $40.9 million. Commercial loans increased $169.1 million or 33.5% from $505.2 million at December 31, 2013 to $674.3 million at December 31, 2014. Total loans increased 2.8% in the fourth quarter of 2014 with positive growth contributions from both the residential mortgage and consumer loan portfolios. Commercial loans decreased 0.4% over the linked quarter due to unanticipated payoffs during the quarter; however, the pipeline going into 2015 remains solid.
Total loan balances in the Kalamazoo and Indianapolis markets continued to grow during 2014 to $142.2 million and $123.4 million, respectively, as of December 31, 2014. Kalamazoo’s aggregate loan balances increased $28.4 million or 24.9%, and Indianapolis’ aggregate loan balances increased $50.8 million or 69.9% compared to December 31, 2013.
The provision for loan losses was $978,000 for the fourth quarter of 2014 compared to a negative provision of $997,000 for the same period of 2013. The higher provision for loan losses for the fourth quarter of 2014 compared to the same period of 2013 was due to loan growth as well as a specific reserve of $560,000 placed on one commercial real estate loan that was moved to non-accrual status during the fourth quarter of 2014. The provision for loan losses was $3.1 million for the year ended December 31, 2014 compared to $1.9 million for the same period of 2013. The higher provision for loan losses for the year ending December 31, 2014 compared to the same period of 2013 was due to loan growth as well as $1.0 million in charge-off expense related to one commercial credit in the third quarter of 2014 and a specific reserve of $560,000 placed on one commercial real estate loan that was moved to non-accrual status during the fourth quarter of 2014.
The ratio of the allowance for loan losses to total loans decreased to 1.19% as of December 31, 2014 from 1.49% as of December 31, 2013 due to an increase in total loans from both organic growth and the Summit acquisition, partially offset by an increase in the allowance for loan losses from $16.0 million as of December 31, 2013 to $16.5 million as of December 31, 2014. The ratio of the allowance for loan losses to total loans, excluding loans with credit-related purchase accounting adjustments, was 1.29% as of December 31, 2014.
Non-performing loans totaled $22.4 million as of December 31, 2014, up from $18.3 million as of December 31, 2013. Compared to December 31, 2013, non-performing commercial loans and consumer loans increased by $4.4 million and $32,000, respectively, partially offset by a decrease of $252,000 in non-performing real estate loans. The increase in non-performing commercial loans was due to the Summit acquisition as well as a commercial real estate loan totaling $5.4 million that was moved to non-accrual status in the fourth quarter of 2014. As a percentage of total loans, non-performing loans were 1.62% at December 31, 2014, down 8 basis points from 1.70% at December 31, 2013. At December 31, 2014, loans acquired in the Summit acquisition represented $1.2 million
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in non-performing, $2.3 million in substandard and $173,000 in delinquent loans.
Expense Management
Total non-interest expense was $3.5 million higher in 2014 compared to 2013 and $62,000 lower in the fourth quarter of 2014 compared to the fourth quarter of 2013. The increase in 2014 compared to the previous year was primarily due to an increase in salaries, occupancy, data processing and outside services and consultant costs. In addition, some of the increase in 2014 compared to 2013 was related to the Summit acquisition.
Use of Non-GAAP Financial Measures
Certain information set forth in this press release refers to financial measures determined by methods other than in accordance with GAAP. Specifically, we have included non-GAAP financial measures of the net interest margin excluding the impact of acquisition-related purchase accounting adjustments and net income and diluted earnings per share excluding the impact of one-time costs related to the Summit acquisition, acquisition-related purchase accounting adjustments and gains on the sale of investment securities. Horizon believes that these non-GAAP financial measures are helpful to investors and provide a greater understanding of our business without giving effect to the purchase accounting impacts and one-time costs of acquisitions and non-core items, although these measures are not necessarily comparable to similar measures that may be presented by other companies and should not be considered in isolation or as a substitute for the related GAAP measure.
About Horizon
Horizon Bancorp is a locally owned, independent, commercial bank holding company serving Northern and Central Indiana and Southwest and Central Michigan through its commercial banking subsidiary Horizon Bank, NA. Horizon also offers mortgage-banking services throughout the Midwest. Horizon Bancorp may be reached online at www.horizonbank.com. Its common stock is
traded on the NASDAQ Global Market under the symbol HBNC.
Forward Looking Statements
This press release may contain forward-looking statements regarding the financial performance, business prospects, growth and operating strategies of Horizon. For these statements, Horizon claims the protections of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this press release should be considered in conjunction with the other information available about Horizon, including the information in the filings we make with the Securities and Exchange Commission. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial
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Pg. 8 cont. Horizon Bancorp Announces 2014 Earnings
performance. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include risk factors relating to the banking industry and the other factors detailed from time to time in Horizon’s reports filed with the Securities and Exchange Commission, including those described in its Form 10-K. Undue reliance should not be placed on the forward-looking statements, which speak only as of the date hereof. Horizon does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.
| Contact: | Horizon Bancorp |
| | Mark E. Secor |
| | Chief Financial Officer |
| | (219) 873-2611 |
| | Fax: (219) 874-9280 |
# # #
HORIZON BANCORP
Financial Highlights
(Dollars in thousands except share and per share data and ratios, Unaudited)
| | | December 31 | | | September 30 | | | June 30 | | | March 31 | | | December 31 | |
| | | 2014 | | | 2014 | | | 2014 | | | 2013 | | | 2013 | |
| Balance sheet: | | | | | | | | | | | | | | | |
| Total assets | | $ | 2,076,922 | | | $ | 2,037,045 | | | $ | 2,073,251 | | | $ | 1,806,583 | | | $ | 1,758,276 | |
| Investment securities | | | 489,531 | | | | 495,941 | | | | 537,618 | | | | 529,340 | | | | 518,501 | |
| Commercial loans | | | 674,314 | | | | 677,349 | | | | 648,202 | | | | 528,635 | | | | 505,189 | |
| Mortgage warehouse loans | | | 129,156 | | | | 105,133 | | | | 140,896 | | | | 102,146 | | | | 98,156 | |
| Residential mortgage loans | | | 254,625 | | | | 251,739 | | | | 235,523 | | | | 189,893 | | | | 185,958 | |
| Consumer loans | | | 320,459 | | | | 308,800 | | | | 296,873 | | | | 280,120 | | | | 279,525 | |
| Earning assets | | | 1,885,576 | | | | 1,860,041 | | | | 1,882,724 | | | | 1,649,653 | | | | 1,604,794 | |
| Non-interest bearing deposit accounts | | | 267,667 | | | | 278,527 | | | | 270,023 | | | | 238,499 | | | | 231,096 | |
| Interest bearing transaction accounts | | | 930,582 | | | | 881,299 | | | | 919,024 | | | | 840,258 | | | | 779,966 | |
| Time deposits | | | 284,070 | | | | 289,837 | | | | 310,056 | | | | 276,814 | | | | 280,458 | |
| Borrowings | | | 351,198 | | | | 350,113 | | | | 340,201 | | | | 236,043 | | | | 256,296 | |
| Subordinated debentures | | | 32,642 | | | | 32,603 | | | | 32,564 | | | | 32,525 | | | | 32,486 | |
| Common stockholders' equity | | | 181,914 | | | | 177,280 | | | | 174,836 | | | | 157,283 | | | | 152,020 | |
| Total stockholders’ equity | | | 194,414 | | | | 189,780 | | | | 187,336 | | | | 169,783 | | | | 164,520 | |
| | | | | | | | | | | | | | | | | | | | | |
| Income statement: | | Three months ended | |
| Net interest income | | $ | 16,523 | | | $ | 16,400 | | | $ | 16,788 | | | $ | 13,272 | | | $ | 14,129 | |
| Provision for loan losses | | | 978 | | | | 1,741 | | | | 339 | | | | - | | | | (997 | ) |
| Non-interest income | | | 6,738 | | | | 7,390 | | | | 6,627 | | | | 5,522 | | | | 5,687 | |
| Non-interest expenses | | | 15,671 | | | | 15,353 | | | | 16,408 | | | | 14,514 | | | | 15,610 | |
| Income tax expense | | | 1,664 | | | | 1,738 | | | | 1,890 | | | | 863 | | | | 1,088 | |
| Net income | | | 4,948 | | | | 4,958 | | | | 4,778 | | | | 3,417 | | | | 4,115 | |
| Preferred stock dividend | | | (31 | ) | | | (40 | ) | | | (31 | ) | | | (31 | ) | | | (63 | ) |
| Net income available to common shareholders | | $ | 4,917 | | | $ | 4,918 | | | $ | 4,747 | | | $ | 3,386 | | | $ | 4,052 | |
| | | | | | | | | | | | | | | | | | | | | |
| Per share data: | | | | | | | | | | | | | | | | | | | | |
| Basic earnings per share | | $ | 0.53 | | | $ | 0.53 | | | $ | 0.52 | | | $ | 0.39 | | | $ | 0.47 | |
| Diluted earnings per share | | | 0.51 | | | | 0.51 | | | | 0.50 | | | | 0.38 | | | | 0.45 | |
| Cash dividends declared per common share | | | 0.14 | | | | 0.13 | | | | 0.13 | | | | 0.11 | | | | 0.11 | |
| Book value per common share | | | 19.75 | | | | 19.25 | | | | 19.00 | | | | 18.22 | | | | 17.64 | |
| Tangible book value per common share | | | 16.26 | | | | 15.75 | | | | 15.47 | | | | 15.52 | | | | 14.97 | |
| Market value - high | | | 26.73 | | | | 23.67 | | | | 22.58 | | | | 24.91 | | | | 26.09 | |
| Market value - low | | $ | 22.83 | | | $ | 20.65 | | | $ | 19.57 | | | $ | 20.27 | | | $ | 21.07 | |
| Weighted average shares outstanding - Basic | | | 9,212,156 | | | | 9,208,707 | | | | 9,182,986 | | | | 8,630,966 | | | | 8,623,360 | |
| Weighted average shares outstanding - Diluted | | | 9,628,240 | | | | 9,588,332 | | | | 9,560,939 | | | | 9,021,786 | | | | 9,020,289 | |
| | | | | | | | | | | | | | | | | | | | | |
| Key ratios: | | | | | | | | | | | | | | | | | | | | |
| Return on average assets | | | 0.96 | % | | | 0.96 | % | | | 0.97 | % | | | 0.79 | % | | | 0.93 | % |
| Return on average common stockholders' equity | | | 10.72 | | | | 10.95 | | | | 11.82 | | | | 8.81 | | | | 10.44 | |
| Net interest margin | | | 3.64 | | | | 3.59 | | | | 3.78 | | | | 3.48 | | | | 3.60 | |
| Loan loss reserve to total loans | | | 1.19 | | | | 1.20 | | | | 1.18 | | | | 1.46 | | | | 1.49 | |
| Non-performing loans to loans | | | 1.62 | | | | 1.47 | | | | 1.41 | | | | 1.59 | | | | 1.70 | |
| Average equity to average assets | | | 9.56 | | | | 9.33 | | | | 8.79 | | | | 9.65 | | | | 9.46 | |
| Bank only capital ratios: | | | | | | | | | | | | | | | | | | | | |
| Tier 1 capital to average assets | | | 8.85 | | | | 8.63 | | | | 8.78 | | | | 9.11 | | | | 9.18 | |
| Tier 1 capital to risk weighted assets | | | 12.00 | | | | 12.13 | | | | 11.47 | | | | 12.87 | | | | 13.42 | |
| Total capital to risk weighted assets | | | 13.12 | | | | 13.26 | | | | 12.53 | | | | 14.12 | | | | 14.67 | |
| | | | | | | | | | | | | | | | | | | | | |
| Loan data: | | | | | | | | | | | | | | | | | | | | |
| Substandard loans | | $ | 27,661 | | | $ | 35,023 | | | $ | 35,495 | | | $ | 32,648 | | | $ | 34,721 | |
| 30 to 89 days delinquent | | | 5,082 | | | | 3,310 | | | | 3,671 | | | | 2,613 | | | | 3,452 | |
| | | | | | | | | | | | | | | | | | | | | |
| 90 days and greater delinquent - accruing interest | | $ | 115 | | | $ | 62 | | | $ | 42 | | | $ | 202 | | | $ | 48 | |
| Trouble debt restructures - accruing interest | | | 4,372 | | | | 5,838 | | | | 5,614 | | | | 4,997 | | | | 5,053 | |
| Trouble debt restructures - non-accrual | | | 2,643 | | | | 3,061 | | | | 3,178 | | | | 3,662 | | | | 3,427 | |
| Non-accrual loans | | | 15,312 | | | | 10,828 | | | | 9,844 | | | | 8,775 | | | | 9,749 | |
| Total non-performing loans | | $ | 22,442 | | | $ | 19,789 | | | $ | 18,678 | | | $ | 17,636 | | | $ | 18,277 | |
HORIZON BANCORP
Financial Highlights
(Dollars in thousands except share and per share data and ratios, Unaudited)
| | | December 31 | | | December 31 | |
| | | 2014 | | | 2013 | |
| Balance sheet: | | | | |
| Total assets | | $ | 2,076,922 | | | $ | 1,758,276 | |
| Investment securities | | | 489,531 | | | | 518,501 | |
| Commercial loans | | | 674,314 | | | | 505,189 | |
| Mortgage warehouse loans | | | 129,156 | | | | 98,156 | |
| Residential mortgage loans | | | 254,625 | | | | 185,958 | |
| Consumer loans | | | 320,459 | | | | 279,525 | |
| Earning assets | | | 1,885,576 | | | | 1,604,794 | |
| Non-interest bearing deposit accounts | | | 267,667 | | | | 231,096 | |
| Interest bearing transaction accounts | | | 930,582 | | | | 790,444 | |
| Time deposits | | | 284,070 | | | | 269,980 | |
| Borrowings | | | 351,198 | | | | 256,296 | |
| Subordinated debentures | | | 32,642 | | | | 32,486 | |
| Common stockholders' equity | | | 181,914 | | | | 152,020 | |
| Total stockholders’ equity | | | 194,414 | | | | 164,520 | |
| | | | | | | | | |
| Income statement: | | Twelve Months Ended | |
| Net interest income | | $ | 62,983 | | | $ | 61,383 | |
| Provision for loan losses | | | 3,058 | | | | 1,920 | |
| Non-interest income | | | 26,277 | | | | 25,906 | |
| Non-interest expenses | | | 61,946 | | | | 58,445 | |
| Income tax expense | | | 6,155 | | | | 7,048 | |
| Net income | | | 18,101 | | | | 19,876 | |
| Preferred stock dividend | | | (133 | ) | | | (370 | ) |
| Net income available to common shareholders | | $ | 17,968 | | | $ | 19,506 | |
| | | | | | | | | |
| Per share data: | | | | | | | | |
| Basic earnings per share | | $ | 1.98 | | | $ | 2.26 | |
| Diluted earnings per share | | | 1.90 | | | | 2.17 | |
| Cash dividends declared per common share | | | 0.51 | | | | 0.42 | |
| Book value per common share | | | 19.75 | | | | 17.64 | |
| Tangible book value per common share | | | 16.26 | | | | 14.97 | |
| Market value - high | | | 26.73 | | | | 26.09 | |
| Market value - low | | $ | 19.57 | | | $ | 18.97 | |
| Weighted average shares outstanding - Basic | | | 9,060,702 | | | | 8,619,330 | |
| Weighted average shares outstanding - Diluted | | | 9,454,125 | | | | 9,000,963 | |
| | | | | | | | | |
| Key ratios: | | | | | | | | |
| Return on average assets | | | 0.93 | % | | | 1.13 | % |
| Return on average common stockholders' equity | | | 10.60 | | | | 12.86 | |
| Net interest margin | | | 3.62 | | | | 3.96 | |
| Loan loss reserve to total loans | | | 1.19 | | | | 1.49 | |
| Non-performing loans to loans | | | 1.62 | | | | 1.70 | |
| Average equity to average assets | | | 9.33 | | | | 9.34 | |
| Bank only capital ratios: | |
| Tier 1 capital to average assets | | | 8.85 | | | | 9.18 | |
| Tier 1 capital to risk weighted assets | | | 12.00 | | | | 13.42 | |
| Total capital to risk weighted assets | | | 13.12 | | | | 14.67 | |
| | | | | | | | | |
| Loan data: | | | | | | | | |
| Substandard loans | | $ | 27,661 | | | $ | 34,721 | |
| 30 to 89 days delinquent | | | 5,082 | | | | 3,452 | |
| | | | | | | | | |
| 90 days and greater delinquent - accruing interest | | $ | 115 | | | $ | 48 | |
| Trouble debt restructures - accruing interest | | | 4,372 | | | | 5,053 | |
| Trouble debt restructures - non-accrual | | | 2,643 | | | | 3,427 | |
| Non-accrual loans | | | 15,312 | | | | 9,749 | |
| Total non-performing loans | | $ | 22,442 | | | $ | 18,277 | |
HORIZON BANCORP
Allocation of the Allowance for Loan and Lease Losses
(Dollars in Thousands, Unaudited)
| | | December 31 | | | September 30 | | | June 30 | | | March 31 | | | December 31 | |
| | | 2014 | | | 2014 | | | 2014 | | | 2014 | | | 2013 | |
| Commercial | | $ | 7,881 | | | $ | 7,515 | | | $ | 6,958 | | | $ | 7,236 | | | $ | 6,663 | |
| Real estate | | | 3,180 | | | | 3,304 | | | | 2,367 | | | | 2,813 | | | | 3,462 | |
| Mortgage warehousing | | | 1,272 | | | | 1,300 | | | | 1,559 | | | | 1,665 | | | | 1,638 | |
| Consumer | | | 4,168 | | | | 4,041 | | | | 4,776 | | | | 4,388 | | | | 4,229 | |
| Unallocated | | | - | | | | - | | | | - | | | | - | | | | - | |
| Total | | $ | 16,501 | | | $ | 16,160 | | | $ | 15,660 | | | $ | 16,102 | | | $ | 15,992 | |
Net Charge-offs (Recoveries)
(Dollars in Thousands, Unaudited)
| | | Three months ended | |
| | | December 31 | | | September 30 | | | June 30 | | | March 31 | | | December 31 | |
| | | 2014 | | | 2014 | | | 2014 | | | 2014 | | | 2013 | |
| Commercial | | $ | 199 | | | $ | 1,006 | | | $ | 185 | | | $ | (361 | ) | | $ | 214 | |
| Real estate | | | 101 | | | | 19 | | | | 169 | | | | 18 | | | | 350 | |
| Mortgage warehousing | | | - | | | | - | | | | - | | | | - | | | | - | |
| Consumer | | | 336 | | | | 217 | | | | 426 | | | | 233 | | | | 295 | |
| Total | | $ | 636 | | | $ | 1,242 | | | $ | 780 | | | $ | (110 | ) | | $ | 859 | |
Total Non-performing Loans
(Dollars in Thousands, Unaudited)
| | | December 31 | | | September 30 | | | June 30 | | | March 31 | | | December 31 | |
| | | 2014 | | | 2014 | | | 2014 | | | 2014 | | | 2013 | |
| Commercial | | $ | 11,855 | | | $ | 9,323 | | | $ | 8,243 | | | $ | 7,313 | | | $ | 7,471 | |
| Real estate | | | 5,894 | | | | 6,312 | | | | 6,672 | | | | 6,357 | | | | 6,146 | |
| Mortgage warehousing | | | - | | | | - | | | | - | | | | - | | | | - | |
| Consumer | | | 4,693 | | | | 4,154 | | | | 3,763 | | | | 3,966 | | | | 4,660 | |
| Total | | $ | 22,442 | | | $ | 19,789 | | | $ | 18,678 | | | $ | 17,636 | | | $ | 18,277 | |
Other Real Estate Owned and Repossessed Assets
(Dollars in Thousands, Unaudited)
| | | December 31 | | | September 30 | | | June 30 | | | March 31 | | | December 31 | |
| | | 2014 | | | 2014 | | | 2014 | | | 2014 | | | 2013 | |
| Commercial | | $ | 411 | | | $ | 376 | | | $ | 452 | | | $ | 812 | | | $ | 830 | |
| Real estate | | | 636 | | | | 875 | | | | 752 | | | | 867 | | | | 1,277 | |
| Mortgage warehousing | | | - | | | | - | | | | - | | | | - | | | | - | |
| Consumer | | | 154 | | | | 3 | | | | 23 | | | | 39 | | | | 14 | |
| Total | | $ | 1,201 | | | $ | 1,254 | | | $ | 1,227 | | | $ | 1,718 | | | $ | 2,121 | |
HORIZON BANCORP AND SUBSIDIARIES
Average Balance Sheets
(Dollar Amounts in Thousands, Unaudited)
| | | Three Months Ended | | | Three Months Ended | |
| | | December 31, 2014 | | | December 31, 2013 | |
| | | Average | | | | | | Average | | | Average | | | | | | Average | |
| | | Balance | | | Interest | | | Rate | | | Balance | | | Interest | | | Rate | |
| ASSETS | | | | | | | | | | | | | | | | | | |
| Interest-earning assets | | | | | | | | | | | | | | | | | | |
| Federal funds sold | | $ | 5,317 | | | $ | 2 | | | | 0.15 | % | | $ | 5,462 | | | $ | 3 | | | | 0.22 | % |
| Interest-earning deposits | | | 8,689 | | | | 3 | | | | 0.14 | % | | | 6,337 | | | | 4 | | | | 0.25 | % |
| Investment securities - taxable | | | 362,550 | | | | 2,215 | | | | 2.42 | % | | | 389,481 | | | | 2,281 | | | | 2.32 | % |
| Investment securities - non-taxable (1) | | | 145,705 | | | | 1,098 | | | | 4.46 | % | | | 147,184 | | | | 1,111 | | | | 4.40 | % |
| Loans receivable (2)(3) | | | 1,343,489 | | | | 16,447 | | | | 4.87 | % | | | 1,067,997 | | | | 14,040 | | | | 5.22 | % |
| Total interest-earning assets (1) | | | 1,865,750 | | | | 19,765 | | | | 4.33 | % | | | 1,616,461 | | | | 17,439 | | | | 4.41 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Noninterest-earning assets | | | | | | | | | | | | | | | | | | | | | | | | |
| Cash and due from banks | | | 28,451 | | | | | | | | | | | | 24,416 | | | | | | | | | |
| Allowance for loan losses | | | (16,094 | ) | | | | | | | | | | | (17,795 | ) | | | | | | | | |
| Other assets | | | 156,992 | | | | | | | | | | | | 136,256 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | $ | 2,035,099 | | | | | | | | | | | $ | 1,759,338 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing deposits | | $ | 1,216,920 | | | $ | 1,273 | | | | 0.42 | % | | $ | 1,096,241 | | | $ | 1,352 | | | | 0.49 | % |
| Borrowings | | | 303,390 | | | | 1,463 | | | | 1.91 | % | | | 221,882 | | | | 1,452 | | | | 2.60 | % |
| Subordinated debentures | | | 32,619 | | | | 506 | | | | 6.15 | % | | | 32,464 | | | | 506 | | | | 6.18 | % |
| Total interest-bearing liabilities | | | 1,552,929 | | | | 3,242 | | | | 0.83 | % | | | 1,350,587 | | | | 3,310 | | | | 0.97 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Noninterest-bearing liabilities | | | | | | | | | | | | | | | | | | | | | | | | |
| Demand deposits | | | 273,973 | | | | | | | | | | | | 229,424 | | | | | | | | | |
| Accrued interest payable and other liabilities | | | 13,740 | | | | | | | | | | | | 12,807 | | | | | | | | | |
| Shareholders' equity | | | 194,457 | | | | | | | | | | | | 166,520 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | $ | 2,035,099 | | | | | | | | | | | $ | 1,759,338 | | | | | | | | �� | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income/spread | | | | | | $ | 16,523 | | | | 3.50 | % | | | | | | $ | 14,129 | | | | 3.44 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income as a percent of average interest earning assets (1) | | | | | | | | | | | 3.64 | % | | | | | | | | | | | 3.60 | % |
| (1) | Securities balances represent daily average balances for the fair value of securities. The average rate is calculated based on the daily average balance for the amortized cost of securities. The average rate is presented on a tax equivalent basis. |
| (2) | Includes fees on loans. The inclusion of loan fees does not have a material effect on the average interest rate. |
| (3) | Non-accruing loans for the purpose of the computations above are included in the daily average loan amounts outstanding. Loan totals are shown net of unearned income and deferred loan fees. |
HORIZON BANCORP AND SUBSIDIARIES
Average Balance Sheets
(Dollar Amounts in Thousands, Unaudited)
| | | Twelve Months Ended | | | Twelve Months Ended | |
| | | December 31, 2014 | | | December 31, 2013 | |
| | | Average | | | | | | Average | | | Average | | | | | | Average | |
| | | Balance | | | Interest | | | Rate | | | Balance | | | Interest | | | Rate | |
| ASSETS | | | | | | | | | | | | | | | | | | |
| Interest-earning assets | | | | | | | | | | | | | | | | | | |
| Federal funds sold | | $ | 6,246 | | | $ | 11 | | | | 0.18 | % | | $ | 8,468 | | | $ | 21 | | | | 0.25 | % |
| Interest-earning deposits | | | 7,087 | | | | 10 | | | | 0.14 | % | | | 7,720 | | | | 19 | | | | 0.25 | % |
| Investment securities - taxable | | | 387,013 | | | | 9,323 | | | | 2.41 | % | | | 371,594 | | | | 8,401 | | | | 2.26 | % |
| Investment securities - non-taxable (1) | | | 146,407 | | | | 4,426 | | | | 4.32 | % | | | 136,584 | | | | 4,216 | | | | 4.98 | % |
| Loans receivable (2)(3) | | | 1,247,510 | | | | 62,435 | | | | 5.01 | % | | | 1,092,662 | | | | 62,229 | | | | 5.70 | % |
| Total interest-earning assets (1) | | | 1,794,263 | | | | 76,205 | | | | 4.36 | % | | | 1,617,028 | | | | 74,886 | | | | 4.80 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Noninterest-earning assets | | | | | | | | | | | | | | | | | | | | | | | | |
| Cash and due from banks | | | 27,168 | | | | | | | | | | | | 24,548 | | | | | | | | | |
| Allowance for loan losses | | | (15,945 | ) | | | | | | | | | | | (18,677 | ) | | | | | | | | |
| Other assets | | | 144,803 | | | | | | | | | | | | 134,220 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | $ | 1,950,289 | | | | | | | | | | | $ | 1,757,119 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing deposits | | $ | 1,182,831 | | | $ | 5,257 | | | | 0.44 | % | | $ | 1,092,796 | | | $ | 5,672 | | | | 0.52 | % |
| Borrowings | | | 281,649 | | | | 5,956 | | | | 2.11 | % | | | 234,927 | | | | 5,821 | | | | 2.48 | % |
| Subordinated debentures | | | 32,561 | | | | 2,009 | | | | 6.17 | % | | | 32,406 | | | | 2,010 | | | | 6.20 | % |
| Total interest-bearing liabilities | | | 1,497,041 | | | | 13,222 | | | | 0.88 | % | | | 1,360,129 | | | | 13,503 | | | | 0.99 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Noninterest-bearing liabilities | | | | | | | | | | | | | | | | | | | | | | | | |
| Demand deposits | | | 258,523 | | | | | | | | | | | | 219,323 | | | | | | | | | |
| Accrued interest payable and other liabilities | | | 12,776 | | | | | | | | | | | | 13,534 | | | | | | | | | |
| Shareholders' equity | | | 181,949 | | | | | | | | | | | | 164,133 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | $ | 1,950,289 | | | | | | | | | | | $ | 1,757,119 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income/spread | | | | | | $ | 62,983 | | | | 3.48 | % | | | | | | $ | 61,383 | | | | 3.81 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income as a percent of average interest earning assets (1) | | | | | | | | | | | 3.62 | % | | | | | | | | | | | 3.96 | % |
| (1) | Securities balances represent daily average balances for the fair value of securities. The average rate is calculated based on the daily average balance for the amortized cost of securities. The average rate is presented on a tax equivalent basis. |
| (2) | Includes fees on loans. The inclusion of loan fees does not have a material effect on the average interest rate. |
| (3) | Non-accruing loans for the purpose of the computations above are included in the daily average loan amounts outstanding. Loan totals are shown net of unearned income and deferred loan fees. |
HORIZON BANCORP AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Dollar Amounts in Thousands)
| | | December 31 | | | December 31 | |
| | | 2014 | | | 2013 | |
| | | (Unaudited) | | | | |
| Assets | | | | | | |
| Cash and due from banks | | $ | 43,476 | | | $ | 31,721 | |
| Investment securities, available for sale | | | 323,764 | | | | 508,591 | |
| Investment securities, held to maturity (fair value of $169,904 and $9,910) | | | 165,767 | | | | 9,910 | |
| Loans held for sale | | | 6,143 | | | | 3,281 | |
| Loans, net of allowance for loan losses of $16,501 and $15,992 | | | 1,362,053 | | | | 1,052,836 | |
| Premises and equipment, net | | | 52,461 | | | | 46,194 | |
| Federal Reserve and Federal Home Loan Bank stock | | | 11,348 | | | | 14,184 | |
| Goodwill | | | 28,176 | | | | 19,748 | |
| Other intangible assets | | | 3,965 | | | | 3,288 | |
| Interest receivable | | | 8,246 | | | | 7,501 | |
| Cash value life insurance | | | 39,382 | | | | 36,190 | |
| Other assets | | | 32,141 | | | | 24,832 | |
| Total assets | | $ | 2,076,922 | | | $ | 1,758,276 | |
| Liabilities | | | | | | | | |
| Deposits | | | | | | | | |
| Non-interest bearing | | $ | 267,667 | | | $ | 231,096 | |
| Interest bearing | | | 1,214,652 | | | | 1,060,424 | |
| Total deposits | | | 1,482,319 | | | | 1,291,520 | |
| Borrowings | | | 351,198 | | | | 256,296 | |
| Subordinated debentures | | | 32,642 | | | | 32,486 | |
| Interest payable | | | 497 | | | | 506 | |
| Other liabilities | | | 15,852 | | | | 12,948 | |
| Total liabilities | | | 1,882,508 | | | | 1,593,756 | |
| Commitments and contingent liabilities | | | | | | | | |
| Stockholders’ Equity | | | | | | | | |
| Preferred stock, Authorized, 1,000,000 shares | | | | | | | | |
| Series B shares $.01 par value, $1,000 liquidation value | | | | | | | | |
| Issued 12,500 shares | | | 12,500 | | | | 12,500 | |
| Common stock, no par value | | | | | | | | |
| Authorized, 22,500,000 shares | | | | | | | | |
| Issued, 9,278,916 and 8,706,971 shares | | | | | | | | |
| Outstanding, 9,213,036 and 8,630,966 shares | | | - | | | | - | |
| Additional paid-in capital | | | 45,916 | | | | 32,496 | |
| Retained earnings | | | 134,477 | | | | 121,253 | |
| Accumulated other comprehensive income (loss) | | | 1,521 | | | | (1,729 | ) |
| Total stockholders’ equity | | | 194,414 | | | | 164,520 | |
| Total liabilities and stockholders’ equity | | $ | 2,076,922 | | | $ | 1,758,276 | |
HORIZON BANCORP AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(Dollar Amounts in Thousands, Except Per Share Data)
| | Three Months Ended | | | Twelve Months Ended | |
| | | December 31 | | | December 31 | |
| | | 2014 | | | 2013 | | | 2014 | | | 2013 | |
| | | (Unaudited) | | | | | | (Unaudited) | | | | |
| Interest Income | | | | | | | | | | | | |
| Loans receivable | | $ | 16,447 | | | $ | 14,040 | | | $ | 62,435 | | | $ | 62,229 | |
| Investment securities | | | | | | | | | | | | | | | | |
| Taxable | | | 2,220 | | | | 2,288 | | | | 9,344 | | | | 8,441 | |
| Tax exempt | | | 1,098 | | | | 1,111 | | | | 4,426 | | | | 4,216 | |
| Total interest income | | | 19,765 | | | | 17,439 | | | | 76,205 | | | | 74,886 | |
| Interest Expense | | | | | | | | | | | | | | | | |
| Deposits | | | 1,273 | | | | 1,352 | | | | 5,257 | | | | 5,672 | |
| Borrowed funds | | | 1,463 | | | | 1,452 | | | | 5,956 | | | | 5,821 | |
| Subordinated debentures | | | 506 | | | | 506 | | | | 2,009 | | | | 2,010 | |
| Total interest expense | | | 3,242 | | | | 3,310 | | | | 13,222 | | | | 13,503 | |
| Net Interest Income | | | 16,523 | | | | 14,129 | | | | 62,983 | | | | 61,383 | |
| Provision for loan losses | | | 978 | | | | (997 | ) | | | 3,058 | | | | 1,920 | |
| Net Interest Income after Provision for Loan Losses | | | 15,545 | | | | 15,126 | | | | 59,925 | | | | 59,463 | |
| Non-interest Income | | | | | | | | | | | | | | | | |
| Service charges on deposit accounts | | | 1,048 | | | | 1,005 | | | | 4,085 | | | | 3,989 | |
| Wire transfer fees | | | 149 | | | | 135 | | | | 557 | | | | 697 | |
| Interchange fees | | | 1,213 | | | | 1,007 | | | | 4,649 | | | | 4,056 | |
| Fiduciary activities | | | 1,360 | | | | 1,197 | | | | 4,738 | | | | 4,337 | |
| Gain on sale of investment securities (includes $0 for the three months ended and $988 for the months ended and $988 for the twelve months ended December 31, 2014 and $0 for the three months ended and $374 for the twelve months ended December 31, 2013, related to accumulated other comprehensive earnings reclassifications) | | | - | | | | - | | | | 988 | | | | 374 | |
| Gain on sale of mortgage loans | | | 2,294 | | | | 1,214 | | | | 8,395 | | | | 8,794 | |
| Mortgage servicing income net of impairment | | | 249 | | | | 708 | | | | 805 | | | | 1,521 | |
| Increase in cash value of bank owned life insurance | | | 266 | | | | 248 | | | | 1,047 | | | | 1,035 | |
| Other income | | | 159 | | | | 173 | | | | 1,013 | | | | 1,103 | |
| Total non-interest income | | | 6,738 | | | | 5,687 | | | | 26,277 | | | | 25,906 | |
| Non-interest Expense | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 8,691 | | | | 8,113 | | | | 32,682 | | | | 31,032 | |
| Net occupancy expenses | | | 1,419 | | | | 1,206 | | | | 5,607 | | | | 4,984 | |
| Data processing | | | 949 | | | | 861 | | | | 3,663 | | | | 3,045 | |
| Professional fees | | | 346 | | | | 358 | | | | 1,731 | | | | 1,668 | |
| Outside services and consultants | | | 696 | | | | 778 | | | | 3,250 | | | | 2,412 | |
| Loan expense | | | 1,281 | | | | 1,112 | | | | 4,770 | | | | 4,668 | |
| FDIC insurance expense | | | 321 | | | | 268 | | | | 1,175 | | | | 1,089 | |
| Other losses | | | (168 | ) | | | 661 | | | | (70 | ) | | | 807 | |
| Other expense | | | 2,136 | | | | 2,253 | | | | 9,138 | | | | 8,740 | |
| Total non-interest expense | | | 15,671 | | | | 15,610 | | | | 61,946 | | | | 58,445 | |
| Income Before Income Tax | | | 6,612 | | | | 5,203 | | | | 24,256 | | | | 26,924 | |
| Income tax expense (includes $0 for the three months ended and $346 for the twelve months ended December 31, 2014 and $0 for the three months ended and $131 for the twelve months ended December 31, 2013 related to income tax expense from reclassification items) | | | 1,664 | | | | 1,088 | | | | 6,155 | | | | 7,048 | |
| Net Income | | | 4,948 | | | | 4,115 | | | | 18,101 | | | | 19,876 | |
| Preferred stock dividend and discount accretion | | | (31 | ) | | | (63 | ) | | | (133 | ) | | | (370 | ) |
| Net Income Available to Common Shareholders | | $ | 4,917 | | | $ | 4,052 | | | $ | 17,968 | | | $ | 19,506 | |
| Basic Earnings Per Share | | $ | 0.53 | | | $ | 0.47 | | | $ | 1.98 | | | $ | 2.26 | |
| Diluted Earnings Per Share | | | 0.51 | | | | 0.45 | | | | 1.90 | | | | 2.17 | |
