EXHIBIT 99.1
News News News News News News
October 20, 2004
First Financial Bancorp Reports Third-Quarter Earnings
| | • | | Year-to-date earnings per share up 9.23 percent |
| | • | | Credit quality continues improvement |
| | • | | Heritage Community Bank to merge into First Financial Bank |
HAMILTON, Ohio – First Financial Bancorp (Nasdaq: FFBC) chairman of the board, Bruce E. Leep, and president and chief executive officer, Claude E. Davis, today announced third-quarter 2004 earnings of $10,824,000 or 25 cents in diluted earnings per share, compared to $7,824,000 or 18 cents in diluted earnings per share for the same period in 2003, a 38.89 percent increase in earnings per share. Bancorp also announced year-to-date earnings of $31,109,000 or 71 cents in diluted earnings per share, compared to $29,065,000 or 65 cents in diluted earnings per share for the same period in 2003. This represents a 9.23 percent increase in year-to-date earnings per share.
Return on average assets for the third quarter was 1.09 percent for 2004, compared to 0.80 percent for the same period in 2003. Return on average shareholders’ equity was 11.81 percent for the third quarter of 2004, versus 8.46 percent for the comparable period in 2003. Year-to-date return on assets was 1.06 percent, compared to 1.02 percent in 2003, while return on average shareholders’ equity was 11.37 percent versus 10.48 percent. Bancorp continues to maintain strong capital with a third-quarter 2004 average equity to assets ratio of 9.27 percent.
“Third quarter earnings were in line with expectations,”Leep said.“Net interest income remained stable and credit quality continued to improve. The fundamentals of Bancorp’s financials have stabilized, providing a solid base for our new CEO, Claude Davis, who joined us on October 1, 2004.”
Davis said,“I continue to be excited about the opportunities at Bancorp. I have already begun the process of working with the staff and the board on a strategy to improve profitability and serve all of our stakeholders in an exceptional way.”
(The preceding overview of First Financial Bancorp’s earnings is supplemented with the following detail:)
Regionalization Update:
Bancorp expects to complete its original plan for regionalization in the first quarter of 2005. Subject to regulatory approval, the plan calls for the merger of Citizens First State Bank and Fidelity Federal Savings Bank into Community First Bank & Trust, headquartered in Celina, Ohio.
Additionally, Bancorp plans to merge its Columbus, Indiana-headquartered Heritage Community Bank affiliate into First Financial Bank, headquartered in Hamilton, Ohio. Subject to regulatory approval, this merger is expected to occur in the first half of 2005. While this was not included in Bancorp’s original plan for regionalization, Bancorp has recently concluded that such a merger is the best strategic direction for the affiliates serving the contiguous markets of southeastern Indiana, southwestern Ohio, and northern Kentucky. Bancorp’s current plan is to operate three regional financial institutions: First Financial Bank, Sand Ridge Bank, and Community First Bank & Trust. The approximate asset size and the region served by each of these banks will be as follows: First Financial Bank with $2 billion serving southeastern Indiana, southwestern Ohio, and northern Kentucky; Sand Ridge Bank with $881 million serving northwestern Indiana and southern Michigan; and Community First Bank & Trust with $1.1 billion serving northeastern Indiana and northwestern Ohio.
Bancorp expects the non-recurring costs associated with the merger of Heritage Community Bank into First Financial Bank to be two cents per share in the fourth quarter of 2004. Resulting annual savings are expected to be one to two cents per share fully realized in 2005. With the departure of the CEO of Heritage Community Bank, in September of this year, C. Douglas Lefferson, First Financial Bancorp senior vice president and chief financial officer and Heritage Community Bank board chairman, has been the interim CEO for Heritage.
Net Interest Income:
Net interest income for the third quarter of 2004 was $36.2 million, compared to $36.4 million in the third quarter of 2003, a decline of 0.47 percent or $172,000. Net interest income on a linked-quarter basis (third quarter 2004 compared to second quarter 2004) remained relatively stable, increasing by $201,000
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or 0.56 percent. Net interest income for 2004 on a year-to-date basis decreased $2.4 million or 2.19 percent from the comparable period in 2003. Bancorp’s net interest margin decreased to 3.93 percent in the third quarter of 2004 from 3.98 percent in the third quarter of 2003. Year-to-date net interest margin was 3.97 percent compared to 4.17 percent in 2003. Linked-quarter net interest margin has decreased 5 basis points from 3.98 percent to 3.93 due to the strategic decision to lengthen the maturities of interest-bearing liabilities in a relatively low interest rate environment.
Average total loans for the third quarter of 2004 increased 3.21 percent and year-to-date average total loans net of unearned income increased 2.28 percent from the comparable period a year ago. This increase was achieved even though Bancorp sold approximately $46 million in loan balances through branch sales, a distressed loan portfolio sale, and a mobile home loan portfolio sale since the third quarter of 2003. Primarily, loan growth has been centered in the commercial real estate category as demand improved primarily in the southwestern Ohio market. On a linked-quarter basis, average outstanding loan balances were 2.15 percent higher, reflecting growth in commercial and residential real estate, installment, and real estate construction loans, as demand improved primarily in Bancorp’s southwestern Ohio market.
Average deposit balances for the third quarter decreased $57.9 million or 1.94 percent and year-to-date average deposits were relatively flat from the comparable period a year ago. Since the third quarter of 2003, deposit balances have been impacted by the sale of two banking centers that reduced deposit balances by $48 million. Bancorp also opened three new banking centers in growing markets — two in the fourth quarter of 2003 and one in the second quarter of 2004. Construction is underway for two new offices expected to open in December 2004. Bancorp continues to evaluate its branch network for opportunities to better position itself for both growth and service.
Credit Quality:
The provision for loan loss expense for the third quarter of 2004 was $2.1 million compared to $4.4 million for the same period in 2003. Net charge-offs of $1.3 million for the third quarter were $3.2 million less than the $4.6 million in net charge-offs for the third quarter of 2003. Year-to-date provision expense was $6.9 million or $4.6 million less than 2003. Year-to-date net charge-offs were $6.1 million in 2004, down $4.9 million from the $11.0 million recorded in 2003. Decreases in commercial loans charged-off and continued strong recoveries on commercial and consumer loans positively impacted net charge-offs for both the third quarter and year-to-date. The percentage of net charge-offs to average loans for the third quarter of 2004 was 0.18 percent compared to 0.64 percent for the same period in 2003. The percentage of net charge-offs to average loans was 0.29 percent for year-to-date 2004, compared to 0.53 percent for the same period in 2003.
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Bancorp continued to maintain appropriate reserves with an allowance to ending loans ratio of 1.66 percent at quarter end versus 1.73 percent for the same quarter a year ago. It is management’s belief that the allowance for loan losses of $48.6 million is adequate to absorb inherent credit losses. The nonperforming assets to ending loans ratio decreased to 0.93 percent as of September 30, 2004, from 1.34 percent at the end of the third quarter of 2003.
Total nonperforming assets — which includes nonaccrual loans, restructured loans, and other real estate owned — decreased 28.14 percent to $27.3 million at the end of the third quarter of 2004 from $38.0 million at September 30, 2003. Nonaccrual loans decreased $6.2 million, and restructured loans decreased $4.2 million. Other real estate owned remained relatively constant, decreasing by $323,000.
Loans delinquent over 90 days decreased 64.97 percent to $1.1 million at the end of the third quarter of 2004 from $3.2 million at the end of the third quarter of 2003.
On a linked-quarter basis, total nonperforming assets decreased $596,000 or 2.14 percent.
Bancorp’s level of nonperforming assets has improved over the last several quarters. This improvement in credit quality was positively influenced by signs of economic recovery, strategies such as the fourth-quarter 2003 distressed loan sale, and improved credit risk and risk management disciplines. Given the current economic environment, Bancorp expects continued stable to improving credit quality trends through 2004, although moderate fluctuations could occur as Bancorp continues to work through credit issues.
Noninterest Income:
Third-quarter 2004 noninterest income was $16.0 million, an increase of 5.86 percent from the third quarter of 2003. Service charge income decreased $64,000 or 1.28 percent from the same quarter a year ago, largely due to the sale of $48 million in retail deposit balances since the third quarter of 2003. Trust revenues for the third quarter of 2004 increased 4.17 percent or $151,000 more than the comparable period last year primarily as a result of year-over-year market value improvements. The other category of noninterest income increased $836,000 or 12.87 percent from a year ago. Included in other noninterest income for the third quarter of 2004 was the recapture of impairment charges on the mortgage-servicing assets of approximately $256,000 compared to an impairment charge of $1,072,000 in 2003, a net change of $1,328,000. Gains on the sale of mortgage loans were $424,000 for the third quarter of 2004 versus $2.0 million for the comparable period in 2003, a change of $1.6 million. Included in the third quarter of 2004 was an approximately $750,000 gain on sale of the Kewanna office of Indiana Lawrence Bank versus an approximately $1 million gain on the sale of the Chickasaw office of Community First Bank &
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Trust in the same quarter of 2003. Also included in the increase was an improvement in brokerage income, income from the life insurance asset, the insurance line of business, and debit card interchange income.
Year-to-date noninterest income increased 5.04 percent to $45.4 million in 2004. This increase was primarily the result of an increase in trust fees, additional life insurance income, and increased brokerage fees. Recapture of impairment on the mortgage-servicing assets was $943,000 in 2004, compared with impairment charges of $1.7 million in 2003, a net change of $2.6 million. This positive change was also offset on a year-to-date basis by a decrease in gains on the sale of mortgage loans from $4.5 million in 2003 to $1.1 million in 2004.
Noninterest Expense:
Total noninterest expense decreased $1.3 million or 3.63 percent for the third quarter of 2004 from the third quarter of 2003. Salaries and employee benefits decreased $2.2 million or 10.03 percent due to the $3.1 million Separation Agreement and Release charge in the third quarter of 2003 for former CEO, Stanley N. Pontius. The decrease was partially offset by other severance charges in the third quarter of 2004 of approximately $300,000. Net occupancy expenses for the third quarter of 2004 increased $220,000 or 11.59 percent as a result of increased building rent, depreciation, and related expenses. Data processing expense for the quarter increased $83,000 or 4.91 percent.
Year-to-date noninterest expense for 2004 was $1.8 million or 1.77 percent more than 2003 as a result of higher salaries and employee benefits, net occupancy expenses, data processing, and other expense. Other noninterest expense on a year-to-date basis was impacted by costs associated with the mobile home loan sale completed in the first quarter of 2004, direct consulting work for Sarbanes-Oxley Section 404 internal control documentation and testing, and the search for the chief executive officer.
Other Items:
Bancorp repurchased 110,999 shares of its common stock during the third quarter of 2004 under a previously approved and ongoing program for general corporate purposes.
A $4.0 billion publicly owned bank holding company with over 4,000 shareholders, First Financial Bancorp currently operates 6 banking affiliates with a total of 106 retail banking centers in Ohio, Michigan, Kentucky, and Indiana, as well as an investment-advisor affiliate and an operations affiliate. Insurance services are offered through Flagstone Insurance and Financial Services.
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This release should be read in conjunction with the consolidated financial statements, notes, and tables attached and in the First Financial Bancorp Annual Report on Form 10-K for the year ended December 31, 2003. Management’s analysis may contain forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. However, such performance involves risk and uncertainties that may cause actual results to differ materially. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to, the strength of the local economies in which operations are conducted, the effects of and changes in policies and laws of regulatory agencies, inflation, and interest rates. For further discussion of certain factors that may cause such forward-looking statements to differ materially from actual results, refer to the 2003 Form 10-K.
First Financial Bancorp
P.O. Box 476
Hamilton, OH 45012
Analyst Contact: C. Douglas Lefferson
513-867-4993
doug.lefferson@ffbc-oh.com
Media Contact: Cheryl R. Lipp
513-867-4929
cheryl.lipp@comfirst.com
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FIRST FINANCIAL BANCORP.
CONSOLIDATED FINANCIAL DATA
(Dollars in thousands, except per share)
(Unaudited)
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EARNINGS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | $ | 36,201 | | | $ | 36,000 | | | $ | 36,157 | | | $ | 34,093 | | | $ | 36,373 | | | $ | 108,358 | | | $ | 110,788 | |
| Net earnings | | | 10,824 | | | | 10,337 | | | | 9,948 | | | | 8,841 | | | | 7,824 | | | | 31,109 | | | | 29,065 | |
| Net earnings per share — basic | | $ | 0.25 | | | $ | 0.24 | | | $ | 0.23 | | | $ | 0.20 | | | $ | 0.18 | | | $ | 0.71 | | | $ | 0.65 | |
| Net earnings per share — diluted | | $ | 0.25 | | | $ | 0.24 | | | $ | 0.23 | | | $ | 0.20 | | | $ | 0.18 | | | $ | 0.71 | | | $ | 0.65 | |
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KEY RATIOS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Return on average assets | | | 1.09 | % | | | 1.06 | % | | | 1.03 | % | | | 0.90 | % | | | 0.80 | % | | | 1.06 | % | | | 1.02 | % |
| Return on average shareholders’ equity | | | 11.81 | % | | | 11.40 | % | | | 10.88 | % | | | 9.62 | % | | | 8.46 | % | | | 11.37 | % | | | 10.48 | % |
| Average shareholders’ equity to average assets | | | 9.27 | % | | | 9.33 | % | | | 9.44 | % | | | 9.38 | % | | | 9.42 | % | | | 9.35 | % | | | 9.70 | % |
| Net interest margin | | | 3.93 | % | | | 3.98 | % | | | 4.00 | % | | | 3.74 | % | | | 3.98 | % | | | 3.97 | % | | | 4.17 | % |
| Net interest margin (fully tax equivalent) | | | 4.02 | % | | | 4.07 | % | | | 4.10 | % | | | 3.84 | % | | | 4.08 | % | | | 4.06 | % | | | 4.27 | % |
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COMMON STOCK DATA | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Average basic shares outstanding | | | 43,750,598 | | | | 43,868,314 | | | | 43,924,139 | | | | 43,993,558 | | | | 44,122,446 | | | | 43,855,706 | | | | 44,498,086 | |
| Average diluted shares outstanding | | | 43,817,398 | | | | 43,951,016 | | | | 43,967,599 | | | | 44,012,803 | | | | 44,160,906 | | | | 43,920,027 | | | | 44,573,629 | |
| Ending shares outstanding | | | 43,695,439 | | | | 43,810,651 | | | | 43,924,139 | | | | 43,939,018 | | | | 44,049,702 | | | | 43,695,439 | | | | 44,049,702 | |
| Market price: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| High | | $ | 18.78 | | | $ | 18.47 | | | $ | 18.82 | | | $ | 16.92 | | | $ | 16.60 | | | $ | 18.82 | | | $ | 17.19 | |
| Low | | $ | 16.71 | | | $ | 15.61 | | | $ | 16.29 | | | $ | 15.14 | | | $ | 14.67 | | | $ | 15.61 | | | $ | 14.67 | |
| Close | | $ | 17.08 | | | $ | 17.72 | | | $ | 18.50 | | | $ | 15.95 | | | $ | 14.75 | | | $ | 17.08 | | | $ | 14.75 | |
| Book value | | $ | 8.50 | | | $ | 8.24 | | | $ | 8.44 | | | $ | 8.34 | | | $ | 8.34 | | | $ | 8.50 | | | $ | 8.34 | |
| Common dividend declared | | $ | 0.15 | | | $ | 0.15 | | | $ | 0.15 | | | $ | 0.15 | | | $ | 0.15 | | | $ | 0.45 | | | $ | 0.45 | |
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AVERAGE BALANCE SHEET ITEMS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans less unearned income | | $ | 2,920,472 | | | $ | 2,859,043 | | | $ | 2,819,711 | | | $ | 2,805,667 | | | $ | 2,829,582 | | | $ | 2,866,606 | | | $ | 2,802,700 | |
| Investment securities | | | 729,627 | | | | 767,667 | | | | 799,823 | | | | 798,727 | | | | 778,365 | | | | 765,574 | | | | 725,826 | |
| Other earning assets | | | 9,818 | | | | 13,827 | | | | 12,279 | | | | 13,559 | | | | 15,845 | | | | 11,967 | | | | 23,314 | |
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| Total earning assets | | | 3,659,917 | | | | 3,640,537 | | | | 3,631,813 | | | | 3,617,953 | | | | 3,623,792 | | | | 3,644,147 | | | | 3,551,840 | |
| Total assets | | | 3,932,743 | | | | 3,907,566 | | | | 3,894,900 | | | | 3,886,012 | | | | 3,894,426 | | | | 3,911,813 | | | | 3,822,740 | |
| Noninterest-bearing deposits | | | 409,237 | | | | 405,098 | | | | 395,894 | | | | 399,611 | | | | 392,862 | | | | 403,431 | | | | 405,384 | |
| Interest-bearing deposits | | | 2,518,080 | | | | 2,514,194 | | | | 2,530,912 | | | | 2,553,934 | | | | 2,592,383 | | | | 2,521,051 | | | | 2,539,208 | |
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| Total deposits | | | 2,927,317 | | | | 2,919,292 | | | | 2,926,806 | | | | 2,953,545 | | | | 2,985,245 | | | | 2,924,482 | | | | 2,944,592 | |
| Borrowings | | | 585,529 | | | | 564,710 | | | | 542,380 | | | | 516,952 | | | | 486,825 | | | | 564,284 | | | | 459,833 | |
| Shareholders’ equity | | | 364,495 | | | | 364,574 | | | | 367,628 | | | | 364,653 | | | | 366,978 | | | | 365,562 | | | | 370,784 | |
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CREDIT QUALITY | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ending allowance for loan losses | | $ | 48,590 | | | $ | 47,824 | | | $ | 47,672 | | | $ | 47,771 | | | $ | 48,680 | | | $ | 48,590 | | | $ | 48,680 | |
| Nonperforming assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual | | | 22,203 | | | | 22,723 | | | | 26,586 | | | | 25,980 | | | | 28,374 | | | | 22,203 | | | | 28,374 | |
| Restructured | | | 2,344 | | | | 2,936 | | | | 3,373 | | | | 3,821 | | | | 6,532 | | | | 2,344 | | | | 6,532 | |
| OREO | | | 2,731 | | | | 2,215 | | | | 3,070 | | | | 3,207 | | | | 3,054 | | | | 2,731 | | | | 3,054 | |
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| Total nonperforming assets | | | 27,278 | | | | 27,874 | | | | 33,029 | | | | 33,008 | | | | 37,960 | | | | 27,278 | | | | 37,960 | |
| Loans delinquent over 90 days | | | 1,116 | | | | 721 | | | | 1,345 | | | | 1,872 | | | | 3,186 | | | | 1,116 | | | | 3,186 | |
| Gross charge-offs: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial real estate | | | (166 | ) | | | (105 | ) | | | (631 | ) | | | (3,377 | ) | | | (300 | ) | | | (902 | ) | | | (836 | ) |
| Commercial loans and leases | | | (429 | ) | | | (560 | ) | | | (1,036 | ) | | | (3,650 | ) | | | (2,771 | ) | | | (2,025 | ) | | | (6,270 | ) |
| Consumer | | | (1,507 | ) | | | (2,622 | ) | | | (2,588 | ) | | | (2,447 | ) | | | (2,351 | ) | | | (6,717 | ) | | | (6,662 | ) |
| All other | | | (22 | ) | | | (2 | ) | | | (27 | ) | | | (8 | ) | | | (38 | ) | | | (51 | ) | | | (56 | ) |
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| Total gross charge-offs | | | (2,124 | ) | | | (3,289 | ) | | | (4,282 | ) | | | (9,482 | ) | | | (5,460 | ) | | | (9,695 | ) | | | (13,824 | ) |
| Recoveries: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial real estate | | | 10 | | | | 0 | | | | 34 | | | | 83 | | | | 5 | | | | 44 | | | | 55 | |
| Commercial loans and leases | | | 213 | | | | 467 | | | | 538 | | | | 561 | | | | 316 | | | | 1,218 | | | | 977 | |
| Consumer | | | 553 | | | | 723 | | | | 1,011 | | | | 498 | | | | 576 | | | | 2,287 | | | | 1,771 | |
| All other | | | 17 | | | | 8 | | | | 0 | | | | 9 | | | | 3 | | | | 25 | | | | 4 | |
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| Total recoveries | | | 793 | | | | 1,198 | | | | 1,583 | | | | 1,151 | | | | 900 | | | | 3,574 | | | | 2,807 | |
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| Total net charge-offs | | | (1,331 | ) | | | (2,091 | ) | | | (2,699 | ) | | | (8,331 | ) | | | (4,560 | ) | | | (6,121 | ) | | | (11,017 | ) |
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CREDIT QUALITY RATIOS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Allowance to ending loans, net of unearned income | | | 1.66 | % | | | 1.65 | % | | | 1.68 | % | | | 1.71 | % | | | 1.73 | % | | | 1.66 | % | | | 1.73 | % |
| Nonperforming assets to ending loans, net of unearned income plus OREO | | | 0.93 | % | | | 0.96 | % | | | 1.16 | % | | | 1.18 | % | | | 1.34 | % | | | 0.93 | % | | | 1.34 | % |
| 90 days past due to loans, net of unearned income | | | 0.04 | % | | | 0.02 | % | | | 0.05 | % | | | 0.07 | % | | | 0.11 | % | | | 0.04 | % | | | 0.11 | % |
| Net charge-offs to average loans, net of unearned income | | | 0.18 | % | | | 0.29 | % | | | 0.38 | % | | | 1.18 | % | | | 0.64 | % | | | 0.29 | % | | | 0.53 | % |
FIRST FINANCIAL BANCORP.
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollars in thousands)
(Unaudited)
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| | | Three months ended, | | Nine months ended, |
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| Interest income | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans, including fees | | $ | 43,687 | | | $ | 42,461 | | | $ | 42,522 | | | $ | 41,393 | | | $ | 45,256 | | | $ | 128,670 | | | $ | 138,378 | |
| Investment securities Taxable | | | 6,106 | | | | 6,241 | | | | 6,813 | | | | 6,060 | | | | 5,263 | | | | 19,160 | | | | 15,741 | |
| Tax-exempt | | | 1,321 | | | | 1,381 | | | | 1,449 | | | | 1,555 | | | | 1,579 | | | | 4,151 | | | | 4,875 | |
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| Total investment securities interest | | | 7,427 | | | | 7,622 | | | | 8,262 | | | | 7,615 | | | | 6,842 | | | | 23,311 | | | | 20,616 | |
| Interest-bearing deposits with other banks | | | 22 | | | | 34 | | | | 28 | | | | 36 | | | | 26 | | | | 84 | | | | 105 | |
| Federal funds sold and securities purchased under agreements to resell | | | 15 | | | | 9 | | | | 11 | | | | 11 | | | | 24 | | | | 35 | | | | 135 | |
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| Total interest income | | | 51,151 | | | | 50,126 | | | | 50,823 | | | | 49,055 | | | | 52,148 | | | | 152,100 | | | | 159,234 | |
| Interest expense Deposits | | | 9,504 | | | | 9,037 | | | | 9,662 | | | | 10,214 | | | | 10,692 | | | | 28,203 | | | | 34,172 | |
| Short-term borrowings | | | 793 | | | | 526 | | | | 499 | | | | 471 | | | | 443 | | | | 1,818 | | | | 1,353 | |
| Long-term borrowings | | | 4,274 | | | | 4,226 | | | | 4,163 | | | | 4,130 | | | | 4,161 | | | | 12,663 | | | | 12,204 | |
| Subordinated debentures and capital securities | | | 379 | | | | 337 | | | | 342 | | | | 147 | | | | 479 | | | | 1,058 | | | | 717 | |
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| Total interest expense | | | 14,950 | | | | 14,126 | | | | 14,666 | | | | 14,962 | | | | 15,775 | | | | 43,742 | | | | 48,446 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income | | | 36,201 | | | | 36,000 | | | | 36,157 | | | | 34,093 | | | | 36,373 | | | | 108,358 | | | | 110,788 | |
| Provision for loan losses | | | 2,097 | | | | 2,243 | | | | 2,600 | | | | 7,422 | | | | 4,364 | | | | 6,940 | | | | 11,520 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income after provision for loan losses | | | 34,104 | | | | 33,757 | | | | 33,557 | | | | 26,671 | | | | 32,009 | | | | 101,418 | | | | 99,268 | |
| Noninterest income Service charges on deposit accounts | | | 4,920 | | | | 4,794 | | | | 4,613 | | | | 4,917 | | | | 4,984 | | | | 14,327 | | | | 14,505 | |
| Trust revenues | | | 3,774 | | | | 4,030 | | | | 3,892 | | | | 3,648 | | | | 3,623 | | | | 11,696 | | | | 10,852 | |
| Investment securities gains (losses) | | | (8 | ) | | | (1 | ) | | | (2 | ) | | | 4 | | | | 28 | | | | (11 | ) | | | 20 | |
| Other | | | 7,330 | | | | 6,082 | | | | 5,938 | | | | 10,458 | | | | 6,494 | | | | 19,350 | | | | 17,808 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total noninterest income | | | 16,016 | | | | 14,905 | | | | 14,441 | | | | 19,027 | | | | 15,129 | | | | 45,362 | | | | 43,185 | |
| Noninterest expenses Salaries and employee benefits | | | 19,491 | | | | 19,056 | | | | 18,519 | | | | 18,625 | | | | 21,664 | | | | 57,066 | | | | 57,883 | |
| Net occupancy | | | 2,119 | | | | 1,968 | | | | 2,205 | | | | 1,872 | | | | 1,899 | | | | 6,292 | | | | 5,793 | |
| Furniture and equipment | | | 1,782 | | | | 1,800 | | | | 1,804 | | | | 1,701 | | | | 1,752 | | | | 5,386 | | | | 5,400 | |
| Data processing | | | 1,773 | | | | 1,758 | | | | 1,863 | | | | 2,037 | | | | 1,690 | | | | 5,394 | | | | 4,693 | |
| Deposit insurance | | | 119 | | | | 166 | | | | 171 | | | | 140 | | | | 147 | | | | 456 | | | | 397 | |
| State taxes | | | 368 | | | | 344 | | | | 344 | | | | 442 | | | | 432 | | | | 1,056 | | | | 1,326 | |
| Amortization of intangibles | | | 220 | | | | 220 | | | | 216 | | | | 205 | | | | 207 | | | | 656 | | | | 619 | |
| Other | | | 8,570 | | | | 8,077 | | | | 8,122 | | | | 8,458 | | | | 7,948 | | | | 24,769 | | | | 23,204 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total noninterest expenses | | | 34,442 | | | | 33,389 | | | | 33,244 | | | | 33,480 | | | | 35,739 | | | | 101,075 | | | | 99,315 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Income before income taxes | | | 15,678 | | | | 15,273 | | | | 14,754 | | | | 12,218 | | | | 11,399 | | | | 45,705 | | | | 43,138 | |
| Income tax expense | | | 4,854 | | | | 4,936 | | | | 4,806 | | | | 3,377 | | | | 3,575 | | | | 14,596 | | | | 14,073 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net earnings | | $ | 10,824 | | | $ | 10,337 | | | $ | 9,948 | | | $ | 8,841 | | | $ | 7,824 | | | $ | 31,109 | | | $ | 29,065 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| ADDITIONAL DATA — FULLY TAX EQUIVALENT NET INTEREST INCOME |
| Interest income | | $ | 51,151 | | | $ | 50,126 | | | $ | 50,823 | | | $ | 49,055 | | | $ | 52,148 | | | $ | 152,100 | | | $ | 159,234 | |
| Tax equivalent adjustment | | | 778 | | | | 819 | | | | 860 | | | | 885 | | | | 900 | | | | 2,457 | | | | 2,756 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Interest income — tax equivalent | | | 51,929 | | | | 50,945 | | | | 51,683 | | | | 49,940 | | | | 53,048 | | | | 154,557 | | | | 161,990 | |
| Interest expense | | | 14,950 | | | | 14,126 | | | | 14,666 | | | | 14,962 | | | | 15,775 | | | | 43,742 | | | | 48,446 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income — tax equivalent | | $ | 36,979 | | | $ | 36,819 | | | $ | 37,017 | | | $ | 34,978 | | | $ | 37,273 | | | $ | 110,815 | | | $ | 113,544 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
FIRST FINANCIAL BANCORP.
CONSOLIDATED STATEMENTS OF CONDITION
(Dollars in thousands)
(Unaudited)
| | | | | | | | | | | | | |
| | | Sep. 30, | | Dec. 31, | | Sep. 30, |
| | | 2004
| | 2003
| | 2003
|
ASSETS | | | | | | | | | | | | |
| Cash and due from banks | | $ | 167,833 | | | $ | 183,612 | | | $ | 159,185 | |
| Interest-bearing deposits with other banks | | | 5,444 | | | | 5,014 | | | | 4,336 | |
| Federal funds sold and securities purchased under agreements to resell | | | 577 | | | | 607 | | | | 15,904 | |
| Investment securities, held-to-maturity | | | 13,515 | | | | 18,399 | | | | 18,700 | |
| Investment securities, available-for-sale | | | 693,255 | | | | 794,762 | | | | 774,813 | |
| Loans | | | | | | | | | | | | |
| Commercial | | | 665,149 | | | | 666,315 | | | | 681,045 | |
| Real estate-construction | | | 88,229 | | | | 73,260 | | | | 68,472 | |
| Real estate-mortgage | | | 1,536,333 | | | | 1,466,153 | | | | 1,472,607 | |
| Installment | | | 603,152 | | | | 560,061 | | | | 563,941 | |
| Credit card | | | 20,458 | | | | 21,680 | | | | 20,189 | |
| Lease financing | | | 6,718 | | | | 12,241 | | | | 14,574 | |
| | |
| | | |
| | | |
| |
| Total loans | | | 2,920,039 | | | | 2,799,710 | | | | 2,820,828 | |
| Less | | | | | | | | | | | | |
| Unearned income | | | 13 | | | | 86 | | | | 138 | |
| Allowance for loan losses | | | 48,590 | | | | 47,771 | | | | 48,680 | |
| | |
| | | |
| | | |
| |
| Net loans | | | 2,871,436 | | | | 2,751,853 | | | | 2,772,010 | |
| Premises and equipment | | | 63,304 | | | | 59,050 | | | | 58,068 | |
| Goodwill | | | 28,444 | | | | 27,379 | | | | 27,379 | |
| Other intangibles | | | 8,450 | | | | 7,530 | | | | 8,183 | |
| Deferred income taxes receivable | | | 7,666 | | | | 6,227 | | | | 8,633 | |
| Other assets | | | 104,409 | | | | 101,629 | | | | 100,922 | |
| | |
| | | |
| | | |
| |
Total Assets | | $ | 3,964,333 | | | $ | 3,956,062 | | | $ | 3,948,133 | |
| | |
| | | |
| | | |
| |
LIABILITIES | | | | | | | | | | | | |
| Deposits | | | | | | | | | | | | |
| Noninterest-bearing | | $ | 422,594 | | | $ | 414,785 | | | $ | 402,571 | |
| Interest-bearing | | | 2,505,585 | | | | 2,530,880 | | | | 2,571,069 | |
| | |
| | | |
| | | |
| |
| Total deposits | | | 2,928,179 | | | | 2,945,665 | | | | 2,973,640 | |
| Short-term borrowings | | | 244,163 | | | | 258,909 | | | | 223,472 | |
| Long-term borrowings | | | 357,950 | | | | 322,979 | | | | 324,863 | |
| Junior subordinated debentures owed to unconsolidated subsidiary trusts | | | 30,930 | | | | 0 | | | | 0 | |
| Corporation-obligated mandatorily redeemable capital securities of subsidiary trust | | | 0 | | | | 30,000 | | | | 30,000 | |
| Accrued interest and other liabilities | | | 31,759 | | | | 32,026 | | | | 30,092 | |
| | |
| | | |
| | | |
| |
Total Liabilities | | | 3,592,981 | | | | 3,589,579 | | | | 3,582,067 | |
SHAREHOLDERS’ EQUITY | | | | | | | | | | | | |
| Common stock | | | 395,580 | | | | 395,752 | | | | 395,888 | |
| Retained earnings | | | 61,647 | | | | 50,325 | | | | 48,078 | |
| Accumulated comprehensive income | | | 180 | | | | 2,344 | | | | 2,714 | |
| Restricted stock awards | | | (3,346 | ) | | | (3,397 | ) | | | (3,849 | ) |
| Treasury stock, at cost | | | (82,709 | ) | | | (78,541 | ) | | | (76,765 | ) |
| | |
| | | |
| | | |
| |
Total Shareholders’ Equity | | | 371,352 | | | | 366,483 | | | | 366,066 | |
| | |
| | | |
| | | |
| |
Total Liabilities and Shareholders’ Equity | | $ | 3,964,333 | | | $ | 3,956,062 | | | $ | 3,948,133 | |
| | |
| | | |
| | | |
| |
ADDITIONAL DATA — RISK BASED CAPITAL
| | | | | | | | | | | | | | | | | | | | | |
| | | Sep. 30, | | Jun. 30, | | Mar. 31, | | Dec. 31, | | Sep. 30, |
| | | 2004
| | 2004
| | 2004
| | 2003
| | 2003
|
| Tier 1 Capital | | $ | 364,529 | | | $ | 361,597 | | | $ | 359,134 | | | $ | 358,616 | | | $ | 358,292 | |
| Tier 1 Ratio | | | 13.24 | % | | | 12.98 | % | | | 13.19 | % | | | 13.20 | % | | | 12.92 | % |
| Total Capital | | $ | 399,108 | | | $ | 396,580 | | | $ | 393,331 | | | $ | 392,735 | | | $ | 393,122 | |
| Total Capital Ratio | | | 14.50 | % | | | 14.24 | % | | | 14.45 | % | | | 14.46 | % | | | 14.18 | % |
| Total Risk-Adjusted Assets | | $ | 2,752,339 | | | $ | 2,785,789 | | | $ | 2,722,261 | | | $ | 2,715,858 | | | $ | 2,772,571 | |
| Leverage Ratio | | | 9.35 | % | | | 9.33 | % | | | 9.30 | % | | | 9.30 | % | | | 9.28 | % |
FIRST FINANCIAL BANCORP.
AVERAGE CONSOLIDATED STATEMENTS OF CONDITIONS
(Dollars in thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Quarterly Averages | | | | | | | | | | Year-to-Date Averages |
| | | Sep. 30, | | Jun. 30, | | Mar. 31, | | Dec. 31, | | Sep. 30, | | September 30, |
| | | 2004
| | 2004
| | 2004
| | 2003
| | 2003
| | 2004
| 2003
| |
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cash and due from banks | | $ | 120,166 | | | $ | 115,009 | | | $ | 114,977 | | | $ | 117,810 | | | $ | 129,005 | | | $ | 116,730 | | | $ | 132,212 | |
| Interest-bearing deposits with other banks | | | 5,124 | | | | 10,422 | | | | 7,588 | | | | 9,252 | | | | 5,671 | | | | 7,702 | | | | 7,387 | |
| Federal funds sold and securities purchased under agreements to resell | | | 4,694 | | | | 3,405 | | | | 4,691 | | | | 4,307 | | | | 10,174 | | | | 4,265 | | | | 15,927 | |
| Investment securities | | | 729,627 | | | | 767,667 | | | | 799,823 | | | | 798,727 | | | | 778,365 | | | | 765,574 | | | | 725,826 | |
| Loans | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial | | | 652,874 | | | | 667,796 | | | | 669,188 | | | | 658,205 | | | | 695,980 | | | | 663,248 | | | | 699,216 | |
| Real estate-construction | | | 88,056 | | | | 77,963 | | | | 76,193 | | | | 68,621 | | | | 69,072 | | | | 80,764 | | | | 77,742 | |
| Real estate-mortgage | | | 1,556,555 | | | | 1,520,659 | | | | 1,488,463 | | | | 1,480,587 | | | | 1,469,535 | | | | 1,522,019 | | | | 1,434,232 | |
| Installment | | | 594,796 | | | | 562,990 | | | | 554,374 | | | | 564,684 | | | | 559,600 | | | | 570,808 | | | | 553,893 | |
| Credit card | | | 20,493 | | | | 20,134 | | | | 20,274 | | | | 20,402 | | | | 20,169 | | | | 20,301 | | | | 20,311 | |
| Lease financing | | | 7,716 | | | | 9,538 | | | | 11,284 | | | | 13,276 | | | | 15,405 | | | | 9,506 | | | | 17,585 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total loans | | | 2,920,490 | | | | 2,859,080 | | | | 2,819,776 | | | | 2,805,775 | | | | 2,829,761 | | | | 2,866,646 | | | | 2,802,979 | |
| Less | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Unearned income | | | 18 | | | | 37 | | | | 65 | | | | 108 | | | | 179 | | | | 40 | | | | 279 | |
| Allowance for loan losses | | | 48,220 | | | | 47,873 | | | | 47,877 | | | | 48,754 | | | | 48,849 | | | | 47,991 | | | | 48,548 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net loans | | | 2,872,252 | | | | 2,811,170 | | | | 2,771,834 | | | | 2,756,913 | | | | 2,780,733 | | | | 2,818,615 | | | | 2,754,152 | |
| Premises and equipment | | | 61,750 | | | | 60,155 | | | | 59,271 | | | | 58,863 | | | | 57,825 | | | | 60,397 | | | | 56,994 | |
| Deferred income tax | | | 10,183 | | | | 8,374 | | | | 5,570 | | | | 8,457 | | | | 7,969 | | | | 8,050 | | | | 5,842 | |
| Other assets | | | 128,947 | | | | 131,364 | | | | 131,146 | | | | 131,683 | | | | 124,684 | | | | 130,480 | | | | 124,400 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Total Assets | | $ | 3,932,743 | | | $ | 3,907,566 | | | $ | 3,894,900 | | | $ | 3,886,012 | | | $ | 3,894,426 | | | $ | 3,911,813 | | | $ | 3,822,740 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Deposits | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest-bearing | | $ | 160,728 | | | $ | 167,560 | | | $ | 193,256 | | | $ | 182,501 | | | $ | 212,102 | | | | 173,800 | | | | 224,996 | |
| Savings | | | 1,072,417 | | | | 1,057,305 | | | | 1,030,709 | | | | 1,046,180 | | | | 1,023,110 | | | | 1,053,546 | | | | 958,997 | |
| Time | | | 1,284,935 | | | | 1,289,329 | | | | 1,306,947 | | | | 1,325,253 | | | | 1,357,171 | | | | 1,293,705 | | | | 1,355,215 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total interest-bearing deposits | | | 2,518,080 | | | | 2,514,194 | | | | 2,530,912 | | | | 2,553,934 | | | | 2,592,383 | | | | 2,521,051 | | | | 2,539,208 | |
| Noninterest-bearing | | | 409,237 | | | | 405,098 | | | | 395,894 | | | | 399,611 | | | | 392,862 | | | | 403,431 | | | | 405,384 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total deposits | | | 2,927,317 | | | | 2,919,292 | | | | 2,926,806 | | | | 2,953,545 | | | | 2,985,245 | | | | 2,924,482 | | | | 2,944,592 | |
| Borrowed funds | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Short-term borrowings | | | 234,622 | | | | 215,124 | | | | 209,166 | | | | 193,390 | | | | 161,742 | | | | 219,692 | | | | 140,890 | |
| Long-term borrowings | | | 350,907 | | | | 349,586 | | | | 333,214 | | | | 323,562 | | | | 325,083 | | | | 344,592 | | | | 318,943 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total borrowed funds | | | 585,529 | | | | 564,710 | | | | 542,380 | | | | 516,952 | | | | 486,825 | | | | 564,284 | | | | 459,833 | |
| Junior subordinated debentures owed to unconsolidated subsidiary trusts | | | 30,930 | | | | 30,930 | | | | 30,930 | | | | 0 | | | | 0 | | | | 30,930 | | | | 0 | |
| Corporation-obligated mandatorily redeemable capital securities of subsidiary trust | | | 0 | | | | 0 | | | | 0 | | | | 30,000 | | | | 26,956 | | | | 0 | | | | 15,714 | |
| Accrued interest and other liabilities | | | 24,472 | | | | 28,060 | | | | 27,156 | | | | 20,862 | | | | 28,422 | | | | 26,555 | | | | 31,817 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Total Liabilities | | | 3,568,248 | | | | 3,542,992 | | | | 3,527,272 | | | | 3,521,359 | | | | 3,527,448 | | | | 3,546,251 | | | | 3,451,956 | |
SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Common stock | | | 395,581 | | | | 395,586 | | | | 395,648 | | | | 395,808 | | | | 395,894 | | | | 395,605 | | | | 395,947 | |
| Retained earnings | | | 58,598 | | | | 53,999 | | | | 51,165 | | | | 47,534 | | | | 48,022 | | | | 54,602 | | | | 43,428 | |
| Accumulated comprehensive income | | | (4,317 | ) | | | (1,199 | ) | | | 3,311 | | | | 2,587 | | | | 3,680 | | | | (748 | ) | | | 6,503 | |
| Restricted stock awards | | | (3,636 | ) | | | (4,124 | ) | | | (4,220 | ) | | | (3,619 | ) | | | (4,969 | ) | | | (3,992 | ) | | | (5,400 | ) |
| Treasury stock, at cost | | | (81,731 | ) | | | (79,688 | ) | | | (78,276 | ) | | | (77,657 | ) | | | (75,649 | ) | | | (79,905 | ) | | | (69,694 | ) |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Total Shareholders’ Equity | | | 364,495 | | | | 364,574 | | | | 367,628 | | | | 364,653 | | | | 366,978 | | | | 365,562 | | | | 370,784 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Total Liabilities and Shareholders’ Equity | | $ | 3,932,743 | | | $ | 3,907,566 | | | $ | 3,894,900 | | | $ | 3,886,012 | | | $ | 3,894,426 | | | $ | 3,911,813 | | | $ | 3,822,740 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
