GERMAN AMERICAN BANCORP
NEWS RELEASE
For additional information, contact:
Mark A Schroeder, President/CEO of German American Bancorp
Bradley M. Rust, Senior Vice President/CFO of German American Bancorp
(812) 482-1314
Page 1 of 3
JASPER, INDIANA | JULY 29, 2005 | GERMAN AMERICAN BANCORP REPORTS EARNINGS INCREASE AND DECLARES QUARTERLY CASH DIVIDEND |
German American Bancorp (NASDAQ: GABC) announced today that its second quarter and year-to-date earnings increased by 3.3% and 12.5% over last year’s same period results, a continuation of the trend of earnings improvement previously reported for the first quarter of 2005.
The Company’s net income for the second quarter was $2,408,000, or $0.22 per share, increasing by $76,000 from reported net income of $2,332,000, or $0.21 per share, in the second quarter of 2004. 2005 year-to-date net income grew by $535,000 to $4,819,000, or $0.44 per share, while the six months’ earnings for 2004 were $4,284,000, or $0.39 per share.
The improvement in 2005 results versus that of 2004 was primarily attributable to increases in the Company’s level of net interest income which was 3.1% higher in the second quarter of the current year as compared to the second quarter of last year and 5.0% greater in 2005 on a year-to-date basis. The increases in short-term market interest rates over the course of the past year have had the expected positive influence on earnings.
“We are very pleased that the improvement in the economic climate at the national level, which has resulted in a more normalized level of market interest rates, has afforded us the opportunity to enhance our level of net interest income,” stated Mark A. Schroeder, President & CEO of German American Bancorp. “While we have dramatically grown our non-interest income in recent years, net interest income remains the largest single determinant of the Company’s level of operating performance.”
The Company had previously announced a pending acquisition of PCB Holding Company of Tell City, Indiana. The completion of this merger, which is expected to be finalized during the fourth quarter, is subject to approval by PCB shareholders, regulatory approvals, and other customary closing conditions. Under the terms of this transaction, PCB’s subsidiary bank, Peoples Community Bank, will be merged with and into German American’s Tell City based banking affiliate, First State Bank, Southwest Indiana.
GERMAN AMERICAN BANCORP
NEWS RELEASE
For additional information, contact:
Mark A Schroeder, President/CEO of German American Bancorp
Bradley M. Rust, Senior Vice President/CFO of German American Bancorp
(812) 482-1314
Page 2 of 3
The Company also announced that its Board had declared a regular quarterly cash dividend of $0.14 per share which will be payable on August 20, 2005 to shareholders of record as of August 10, 2005.
German American Bancorp is a financial services holding company based in Jasper, Indiana. The Company’s Common Stock is traded on NASDAQ’s National Market System under the symbol GABC. The Company operates five affiliated community banks with 26 retail banking offices in the eight contiguous Southwestern Indiana counties of Daviess, Dubois, Gibson, Knox, Martin, Perry, Pike, and Spencer. The Company also operates German American Financial Advisors & Trust Company, a trust, brokerage and financial planning subsidiary operating from the banking offices of the bank subsidiaries and German American Insurance, Inc., a full-line property and casualty insurance subsidiary with five independent insurance offices throughout its market area. The Company’s lines of business include retail and commercial banking, mortgage banking, comprehensive wealth management, full service brokerage and trust administration, title insurance, and a full range of personal and corporate insurance products.
Forward-Looking Statements
The Company’s statements in this press release regarding its financial performance may be deemed to include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Readers are cautioned that, by their nature, forward-looking statements are based on assumptions and are subject to risks, uncertainties, and other factors. Changes in the Company’s net interest income may vary materially from those that are presently expected, if interest rates should decline or not increase. Other factors that could cause net interest income and earnings to vary from those that are expected, or those that have historically been achieved in recent periods, include the effects of changes in competitive conditions; the introduction, withdrawal, success and timing of asset/liability management strategies or of business initiatives and business strategies; changes in customer borrowing, repayment, investment and deposit practices; changes in fiscal, monetary and tax policies; changes in financial and capital markets; changes in general economic conditions, either nationally or regionally, resulting in, among other things, credit quality deterioration; capital management activities; actions of the Federal Reserve Board; changes in accounting principles and interpretations; and legislative and regulatory actions and reforms. These forward-looking statements speak only as of the date of this press release and the Company undertakes no obligation to update any such forward-looking statement to reflect events or circumstances that occur after the date hereof.
GERMAN AMERICAN BANCORP
(unaudited, dollars in thousands except per share data)
Consolidated Balance Sheets Consolidated Statements of Income
| June 30, |
|---|
| 2005
| 2004
|
|---|
| ASSETS | | | | | | | | |
| Cash and Due from Banks | | | $ | 17,996 | | $ | 25,978 | |
| Short-term Investments | | | | 7,685 | | | 6,684 | |
| Investment Securities | | | | 191,131 | | | 207,565 | |
| | |
| |
| Loans Held-for-Sale | | | | 3,038 | | | 4,839 | |
| | |
| |
| Loans, Net of Unearned Income | | | | 625,443 | | | 621,216 | |
| Allowance for Loan Losses | | | | (9,501 | ) | | (8,957 | ) |
|
| |
| |
| Net Loans | | | | 615,942 | | | 612,259 | |
| |
| Stock in FHLB and Other Restricted Stock | | | | 13,829 | | | 13,252 | |
| Premises and Equipment | | | | 19,440 | | | 20,913 | |
| Other Assets | | | | 40,166 | | | 38,969 | |
|
| |
| |
| TOTAL ASSETS | | | $ | 909,227 | | $ | 930,459 | |
|
| |
| |
| |
| | |
| LIABILITIES | | |
| Non-interest-bearing Demand Deposits | | | $ | 120,656 | | $ | 114,545 | |
| Interest-bearing Demand, Savings, and | | |
| | |
| Money Market Accounts | | | | 281,123 | | | 282,725 | |
| Time Deposits | | | | 307,819 | | | 324,788 | |
|
| |
| |
| Total Deposits | | | | 709,598 | | | 722,058 | |
| | |
| |
| Borrowings | | | | 104,211 | | | 114,918 | |
| Other Liabilities | | | | 11,729 | | | 12,959 | |
|
| |
| |
| TOTAL LIABILITIES | | | | 825,538 | | | 849,935 | |
|
| |
| |
| | |
| |
| SHAREHOLDERS' EQUITY | | |
| Common Stock and Surplus | | | | 76,490 | | | 78,016 | |
| Retained Earnings | | | | 7,556 | | | 5,636 | |
| Accumulated Other Comprehensive Income | | | | (357 | ) | | (3,128 | ) |
|
| |
| |
| TOTAL SHAREHOLDERS' EQUITY | | | | 83,689 | | | 80,524 | |
|
| |
| |
| | |
| |
| TOTAL LIABILITIES AND | | |
| SHAREHOLDERS' EQUITY | | | $ | 909,227 | | $ | 930,459 | |
|
| |
| |
| | |
| |
| BOOK VALUE PER SHARE | | | $ | 7.73 | | $ | 7.39 | |
| |
| END OF PERIOD SHARES OUTSTANDING | | | | 10,824,223 | | | 10,898,241 | |
GERMAN AMERICAN BANCORP
(unaudited, dollars in thousands except per share data)
Consolidated Statements of Income
| Three Months Ended
June 30, | Six Months Ended
June 30, |
|---|
| 2005
| 2004
| 2005
| 2004
|
|---|
| |
| INTEREST INCOME | | | | | | | | | | | | | | |
| Interest and Fees on Loans | | | $ | 10,074 | | $ | 9,742 | | $ | 19,988 | | $ | 19,447 | |
| Interest on Short-term Investments | | | | 52 | | | 20 | | | 139 | | | 48 | |
| Interest and Dividends on Investment Securities | | | | 2,046 | | | 2,126 | | | 4,049 | | | 4,169 | |
|
| |
| |
| |
| |
| TOTAL INTEREST INCOME | | | | 12,172 | | | 11,888 | | | 24,176 | | | 23,664 | |
|
| |
| |
| |
| |
| |
| INTEREST EXPENSE | | |
| Interest on Deposits | | | | 3,082 | | | 2,986 | | | 5,971 | | | 6,119 | |
| Interest on Borrowings | | | | 1,115 | | | 1,167 | | | 2,231 | | | 2,332 | |
|
| |
| |
| |
| |
| TOTAL INTEREST EXPENSE | | | | 4,197 | | | 4,153 | | | 8,202 | | | 8,451 | |
|
| |
| |
| |
| |
| |
| Net Interest Income | | | | 7,975 | | | 7,735 | | | 15,974 | | | 15,213 | |
| Provision for Loan Losses | | | | 691 | | | 838 | | | 1,173 | | | 1,240 | |
|
| |
| |
| |
| |
Net Interest Income after
Provision for Loan Losses | | | | 7,284 | | | 6,897 | | | 14,801 | | | 13,973 | |
|
| |
| |
| |
| |
| |
| NON-INTEREST INCOME | | |
| Other Operating Income | | | | 3,328 | | | 3,507 | | | 6,733 | | | 6,368 | |
| Net Gain on Sales of Loans and Related Assets | | | | 229 | | | 363 | | | 465 | | | 545 | |
| Net Gain on Securities | | | | — | | | — | | | — | | | 55 | |
|
| |
| |
| |
| |
| TOTAL NON-INTEREST INCOME | | | | 3,557 | | | 3,870 | | | 7,198 | | | 6,918 | |
|
| |
| |
| |
| |
| |
| NON-INTEREST EXPENSE | | |
| Salaries and Benefits | | | | 4,531 | | | 4,495 | | | 9,127 | | | 9,110 | |
| Other Operating Expenses | | | | 3,177 | | | 3,369 | | | 6,519 | | | 6,604 | |
|
| |
| |
| |
| |
| TOTAL NON-INTEREST EXPENSE | | | | 7,708 | | | 7,864 | | | 15,646 | | | 15,714 | |
|
| |
| |
| |
| |
| |
| Income before Income Taxes | | | | 3,133 | | | 2,903 | | | 6,353 | | | 5,177 | |
| Income Tax Expense | | | | 725 | | | 571 | | | 1,534 | | | 893 | |
|
| |
| |
| |
| |
| |
| NET INCOME | | | $ | 2,408 | | $ | 2,332 | | $ | 4,819 | | $ | 4,284 | |
|
| |
| |
| |
| |
| |
| EARNINGS PER SHARE & DILUTED EARNINGS PER SHARE | | | $ | 0.22 | | $ | 0.21 | | $ | 0.44 | | $ | 0.39 | |
| |
| WEIGHTED AVERAGE SHARES OUTSTANDING: | | |
| Basic | | | | 10,832,135 | | | 10,925,569 | | | 10,863,370 | | | 10,931,184 | |
| Diluted | | | | 10,836,778 | | | 10,955,380 | | | 10,872,925 | | | 10,966,337 | |
