Exhibit 99.1
NEWS RELEASE DATED 7-13-2004
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| | | For Additional Information, Contact:
Robert O. Bratton,
Chief Financial Officer
(704) 688-4473
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| | or | |
| | | Jan H. Hollar,
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| | | Director of Finance
(704)688-4467 | |
FOR IMMEDIATE RELEASE
July 13, 2004
First Charter Announces Improved Second Quarter Earnings
Charlotte, North Carolina — First Charter Corporation (NASDAQ: FCTR) today reported second quarter 2004 earnings of $10.3 million or $0.34 per diluted share compared to a net loss of $4.2 million, or $0.14 per diluted share, for the same period in 2003. For the first half of 2004, First Charter reported earnings of $19.5 million, or $0.65 per diluted share, compared to earnings of $5.7 million, or $0.19 per diluted share, for the same period in 2003. Earnings for the three and six months ended June 30, 2003 were impacted by a higher provision for loan losses primarily attributable to the sale of $60.9 million of nonaccruing and accruing higher risk loans.
Loan and deposit growth remained strong during the second quarter of 2004, as gross loans increased at an annualized rate of 12 percent and deposits increased at an annualized rate of 14 percent. Asset quality trends remained stable during the quarter, with nonperforming assets remaining at 0.79 percent of loans and other real estate owned, while 30 day past due loans decreased to 0.47 percent of loans. The Corporation continued to experience increased revenue growth in financial management, insurance services, brokerage services and service charges compared to the second quarter of 2003. In addition, the Corporation continued to realize the benefits resulting from the refinancing of fixed term advances during 2003 and certain asset-liability management transactions entered into during 2004 as interest expense decreased 22 percent.
“The Community Banking Strategy at First Charter is working,” said Lawrence M. Kimbrough, President and Chief Executive Officer. “Our daily determination to deliver exceptional service is recognized by our customers and they have rewarded us with steady growth in deposits, loans and fees.”
Summary
Second Quarter 2004 compared to Second Quarter 2003
| | • | | Net interest income increased $4.0 million or 15 percent. |
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| | • | | Provision for loan losses decreased $17.5 million or 90 percent. |
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| | • | | Service charges increased $0.8 million or 14 percent. |
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| | • | | Financial management income increased $1.1 million or 217 percent. |
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| | • | | Brokerage services income increased $0.1 million or 11 percent. |
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| | • | | Insurance services income increased $0.4 million or 18 percent. |
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| | • | | Noninterest expense decreased $5.3 million or 16 percent. |
Second Quarter 2004 compared to First Quarter 2004
| | • | | Gross loans and loans held for sale increased $77.0 million or 3 percent. |
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| | • | | Average earning assets increased $110.4 million or 3 percent. |
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| | • | | Transaction based deposits increased $69.6 million or 5 percent. |
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| | • | | Average deposits increased $111.2 million or 5 percent. |
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| | • | | Net interest margin decreased 13 basis points to 3.06 percent. |
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| | • | | Provision for loan losses decreased $1.0 million or 33 percent. |
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| | • | | Service charges increased $0.7 million or 13 percent. |
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| | • | | Mortgage loan fees increased $0.2 million or 39 percent. |
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| | • | | Insurance services income decreased $0.4 million or 13 percent. |
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| | • | | Noninterest expense decreased $0.6 million or 2 percent. |
Year-to-Date 2004 compared to Year-to-Date 2003
| | • | | Average loans and loans held for sale increased $160.6 million or 7 percent. |
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| | • | | Average earning assets increased $378.4 million or 11 percent. |
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| | • | | Average deposits increased $42.6 million or 2 percent. |
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| | • | | Net interest margin increased 9 basis points to 3.12 percent. |
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| | • | | Provision for loan losses decreased $16.5 million or 77 percent. |
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| | • | | Service charges increased $1.3 million or 12 percent. |
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| | • | | Financial management income increased $2.0 million or 186 percent. |
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| | • | | Mortgage loan fees decreased $0.2 million or 16 percent. |
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| | • | | Brokerage services income increased $0.6 million or 44 percent. |
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| | • | | Insurance services income increased $1.0 million or 21 percent. |
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| | • | | Noninterest expense decreased $3.0 million or 5 percent. |
Key Customer Indicators
| | • | | Second quarter 2004 customer service quality score was 83 percentvery satisfied. |
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| | • | | During the first half of 2004, 19,779 new checking accounts were opened. |
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| | • | | During the first half of 2004, core households increased 7,797. |
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| | • | | Customer retention ratio as of June 30, 2004 was 85 percent. |
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Financial Highlights
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| | | For the Three Months | | For the Six Months |
| | | Ended June 30
| | Ended June 30
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Earnings (Dollars in thousands, except per share data)
| | 2004
| | 2003
| | 2004
| | 2003
|
| Total revenues | | $ | 44,922 | | | $ | 46,254 | | | $ | 89,960 | | | $ | 88,376 | |
| Net income (loss) | | | 10,255 | | | | (4,204 | ) | | | 19,495 | | | | 5,742 | |
| Diluted earnings (loss) per share | | | 0.34 | | | | (0.14 | ) | | | 0.65 | | | | 0.19 | |
| Return on average assets | | | 0.96 | % | | | (0.42 | )% | | | 0.92 | % | | | 0.30 | % |
| Return on average equity | | | 13.90 | | | | (5.18 | ) | | | 13.07 | | | | 3.56 | |
Efficiency-taxable equivalent ratio(*) | | | 61.66 | | | | 85.65 | | | | 62.13 | | | | 73.72 | |
| * | | - Noninterest expense divided by the sum of taxable equivalent net interest income plus noninterest income less gain on sale of securities. |
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| | | June 30 | | December 31 | | Increase (Decrease)
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Balance Sheet (Dollars in thousands)
| | 2004
| | 2003
| | Amount
| | Percentage
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| Loans held for sale | | $ | 26,768 | | | $ | 5,137 | | | $ | 21,631 | | | | 421.05 | % |
| Loans, net | | | 2,321,986 | | | | 2,227,030 | | | | 94,956 | | | | 4.26 | |
| Investments | | | 1,604,585 | | | | 1,601,900 | | | | 2,685 | | | | 0.17 | |
| Total assets | | | 4,339,213 | | | | 4,206,693 | | | | 132,520 | | | | 3.15 | |
| Demand, savings and money market deposits | | | 1,383,211 | | | | 1,237,726 | | | | 145,485 | | | | 11.75 | |
| Total deposits | | | 2,594,765 | | | | 2,427,897 | | | | 166,868 | | | | 6.87 | |
| Other borrowings | | | 1,410,481 | | | | 1,432,200 | | | | (21,719 | ) | | | (1.52 | ) |
| Shareholders’ equity | | | 283,781 | | | | 299,439 | | | | (15,658 | ) | | | (5.23 | ) |
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| | | June 30 | | June 30 | | Increase (Decrease)
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Average Balances (Dollars in thousands)
| | 2004
| | 2003
| | Amount
| | Percentage
|
| Loans held for sale | | $ | 10,651 | | | $ | 23,632 | | | $ | (12,981 | ) | | | (54.93 | )% |
| Loans, net | | | 2,295,854 | | | | 2,122,314 | | | | 173,540 | | | | 8.18 | |
| Investments | | | 1,614,000 | | | | 1,354,558 | | | | 259,442 | | | | 19.15 | |
| Total assets | | | 4,263,381 | | | | 3,893,661 | | | | 369,719 | | | | 9.50 | |
| Total deposits | | | 2,492,291 | | | | 2,449,733 | | | | 42,558 | | | | 1.74 | |
| Other borrowings | | | 1,427,342 | | | | 1,067,555 | | | | 359,787 | | | | 33.70 | |
| Shareholders’ equity | | | 299,848 | | | | 325,699 | | | | (25,851 | ) | | | (7.94 | ) |
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Net Interest Income/Margin
Second Quarter
Net interest income increased $4.0 million, or 15 percent, to $30.0 million compared to the second quarter of 2003. The increase was primarily due to a $4.2 million decrease in interest expense resulting from (a) a shift in funding sources from higher-cost retail certificates of deposit to lower-cost transaction based accounts, (b) the benefits from the refinancing of $50 million and $81 million of fixed-term advances in the second quarter and fourth quarter of 2003, respectively, and (c) the benefits from certain asset-liability management transactions entered into during the first half of 2004. Net interest income was also impacted by a $0.3 million decrease in interest income due mainly to lower yields on earning assets resulting from the continued effects of the low interest rate environment.
The net interest margin increased to 3.06 percent in the second quarter of 2004 from 2.92 percent for the same period in 2003 as rates paid on interest bearing liabilities declined faster than yields earned on interest bearing assets.
Year-to-Date
Net interest income increased $7.8 million, or 15 percent, to $60.4 million compared to the same period in 2003. The increase was primarily due to an $8.2 million decrease in interest expense due to (a) a shift in funding sources from higher-cost retail certificates of deposit to lower-cost transaction based accounts, (b) the benefits from the refinancing of $50 million and $81 million of fixed-term advances in the second quarter and fourth quarter of 2003, respectively, and (c) the benefits from certain asset-liability management transactions entered into during the first half of 2004. Net interest income was also impacted by a $0.6 million decrease in interest income due mainly to lower yields on earning assets resulting from the continued effects of the low interest rate environment.
The net interest margin for the six months ended June 30, 2004 increased to 3.12 percent from 3.03 percent for the same period in 2003 as rates paid on interest bearing liabilities declined faster than yields earned on interest bearing assets.
Noninterest Income
Second Quarter
Noninterest income decreased $5.3 million to $14.9 million compared to the second quarter of 2003. Gains on the sale of securities of $0.5 million were recognized in the second quarter of 2004 compared to $8.3 million in 2003, representing a decrease of $7.8 million. In addition, trading gains of $0.4 million were recognized in the second quarter of 2003. These decreases in noninterest income were partially offset by a $1.1 million increase in financial management income primarily due to (a) the acquisition of a third party benefits administrator in the third quarter of 2003, (b) a $0.8 million increase in service charges, (c) a $0.5 million increase in other noninterest income due to growth in ATM, debit card and other miscellaneous fees, and (d) a $0.4 million increase in insurance services income primarily due the acquisition of two insurance agencies in the third and fourth quarter of 2003.
Year-to-Date
Noninterest income decreased $6.2 million to $29.6 million compared to the same period in 2003. Gains on the sale of securities of $0.8 million were recognized in the first half of 2004 compared to $9.5 million in 2003, representing a decrease of $8.7 million. Gains totaling $2.2 million from the sale of the Corporation’s credit card portfolio and $1.6 million of trading gains were recognized in the first half of 2003. These decreases in noninterest income were partially offset by a (a) $2.0 million increase in financial management income primarily due to the acquisition of a third party benefits administrator in the third quarter of 2003, (b) a $1.3 million increase in service charges, (c) a $1.0 million increase in
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other noninterest income due to growth in ATM, debit card and other miscellaneous fees, (d) a $1.0 million increase in insurance services income primarily due the acquisition of two insurance agencies in the third and fourth quarter of 2003, and (e) a $0.6 million increase in brokerage services income. In addition, gains totaling $0.8 million from the sale of bank property were recognized in the first half of 2004.
Noninterest Expense
Second Quarter
Noninterest expense decreased $5.3 million to $27.7 million compared to the second quarter of 2003. The decrease was due to $7.4 million of prepayment costs associated with refinancing $50 million in fixed term advances in the second quarter of 2003 which did not recur in 2004. In addition, professional fees decreased $0.9 million primarily due to second quarter 2003 fees associated with the previously mentioned sale of $60.9 million of nonaccruing and accruing higher risk loans. These decreases were partially offset by a $1.8 million increase in salaries and employee benefits due to additional personnel, including the acquisition of a third party benefits administrator and two insurance agencies and increased incentive compensation accruals.
Year-to-Date
Noninterest expense decreased $3.0 million to $56.0 million compared to the first half of 2003. The decrease was due to $7.4 million of prepayment costs associated with refinancing $50 million in fixed term advances in the second quarter of 2003 which did not recur in 2004. This decrease was partially offset by a $3.1 million increase in salaries and employee benefits due to additional personnel, including the acquisition of a third party benefits administrator and two insurance agencies and increased incentive compensation accruals.
Efficiency Ratio
The efficiency ratio decreased to 62.1 percent compared to 73.7 percent for the first half of 2003. A significant portion of the decrease relates to the second quarter 2003 costs associated with the prepayment of fixed term advances. The calculation of the efficiency ratio excludes gains on sale of securities of $0.8 million and $9.5 million for the six months ended June 30, 2004 and 2003, respectively.
Income Tax Expense
Second Quarter
Total income tax expense for the second quarter of 2004 was $5.0 million compared to an income tax benefit of $2.0 million for the second quarter of 2003. The increase in the effective tax rate for 2004 was due to an increase in projected taxable income relative to nontaxable adjustments.
Year-to-Date
The income tax expense for the first half of 2004 amounted to $9.5 million for an effective tax rate of 32.7 percent compared to $2.1 million for an effective tax rate of 26.5 percent the first half of 2003. The increase in the effective tax rate for 2004 was due to an increase in projected taxable income relative to nontaxable adjustments.
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Loans Held for Sale
Loans held for sale consist primarily of 15 and 30 year residential mortgage loans which the Corporation intends to sell as whole loans or securitize to improve its liquidity position. Loans held for sale increased to $26.8 million at June 30, 2004 as compared to $5.1 million at December 31, 2003. During the first half of 2004, $21.3 million of residential mortgage loans were securitized and moved to securities available for sale.
Loans
Gross loans increased $95.4 million to $2.35 billion at June 30, 2004 as compared to $2.25 billion at December 31, 2003. The growth in loans was primarily due to a $54.7 million increase in home equity loans, a $44.3 million increase in commercial real estate loans, and a $34.3 million increase in primarily adjustable rate mortgage loans. These increases were partially offset by a $26.2 million and an $8.2 million decrease in construction and consumer loans, respectively. In addition, $6.4 million of nonaccruing and accruing higher risk residential mortgage loans were sold to investors during the first quarter of 2004 and $45.7 million of primarily fixed rate mortgage loans originated in the first half of 2004 were classified as held for sale.
Securities
The securities available for sale portfolio remained essentially unchanged at $1.60 billion at June 30, 2004 as compared to December 31, 2003. The securities available for sale portfolio was impacted by an increase in the unrealized net losses in the portfolio due to a rise in interest rates across the yield curve. Unrealized net losses on securities available for sale were $30.8 million at June 30, 2004 compared to unrealized net gains of $10.1 million at December 31, 2003. The decrease in the securities available for sale portfolio was partially offset by the securitization of $21.3 million of residential mortgage loans during the second quarter.
Deposits
The Corporation’s CHecking Account Marketing Program (CHAMP) continues to attract new customers and deposits. During the first half of 2004, 19,779 new checking accounts were opened. In addition, during the first quarter of 2004 the Corporation introduced a new money market account, the Performance Plus Account. This product has generated $228.0 million of deposits as of June 30, 2004. The emphasis of these programs is to develop new customer relationships, to shift our funding mix towards lower-cost funding sources and to generate additional fee income opportunities.
Total deposits increased $166.9 million, or 7 percent, to $2.59 billion at June 30, 2004 compared to $2.43 billion at December 31, 2003. The increase in deposits was due to a $93.0 million increase in money market accounts, a $52.5 million increase in low-cost interest checking, savings and noninterest bearing deposits. Also, as a result of the Corporation’s strategy of shifting the funding mix, lower-cost brokered certificates of deposit increased $65.6 million, while higher-cost retail certificates of deposit decreased $44.2 million.
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Interest Rate Swaps
In the first half of 2004, the Corporation entered into a series of interest rate swap agreements. The interest rate swap agreements currently allow the Corporation to swap higher fixed rate interest payments on long-term FHLB advances for lower variable rate payments. During the first half of 2004, the interest rate swaps resulted in the Corporation receiving interest at an average fixed rate of 5.16 percent and paying interest at an average variable rate of 3.00 percent, for an average period of 5.9 years on a notional amount of $222 million.
As a result of swapping $222 million of fixed rate debt payments for variable rate payments, the Corporation’s balance sheet would become liability sensitive. Therefore, as part of the Corporation’s asset/liability management strategy of preserving the asset sensitive nature of the Corporation’s balance sheet, the Corporation replaced $255 million of existing FHLB floating rate overnight borrowings with fixed rate FHLB advances with maturities of one to three years.
Shareholders’ Equity
Shareholders’ equity at June 30, 2004 decreased to $283.8 million, representing 6.54 percent of period-end assets compared to $299.4 million or 7.12 percent of period-end assets at December 31, 2003. The after-tax unrealized loss on available for sale securities was $18.8 million at June 30, 2004 compared to an after-tax unrealized gain of $6.2 million at December 31, 2003. The change was due to an increase in rates across the yield curve. At June 30, 2004, the book value per share was $9.53. Based on the $21.79 closing price of First Charter Corporation common stock at June 30, 2004, the Corporation had a market capitalization of $648.7 million.
Provision for Loan Losses
The provision for loan losses decreased to $2.0 million for the three months ended June 30, 2004 compared to $19.5 million for the same year ago period. The provision for loan losses for the six months ended June 30, 2004 amounted to $5.0 million compared to $21.5 million for the same year ago period. The decrease in the provision for loan losses was primarily attributable to the previously mentioned sale of $60.9 million of nonaccruing and accruing higher risk loans in the second quarter of 2003.
In addition, certain residential rental property loans totaling $12.9 million identified in the second quarter of 2003 resulted in the Corporation increasing the provision for loan losses by approximately $2.4 million during that period. At June 30, 2004, there were 115 of these loans remaining with a balance of $7.6 million.
Net Charge-Offs
Second Quarter
Net charge-offs for the three months ended June 30, 2004 amounted to $1.7 million, or 0.29 percent of average loans, compared to $2.1 million, or 0.39 percent of average loans for the same 2003 period. Net charge-offs benefited from a $0.6 million commercial loan recovery during the second quarter of 2004.
Year-to-Date
Net charge-offs for the six months ended June 30, 2004 amounted to $4.0 million, or 0.35 percent of average loans compared to $4.3 million, or 0.41 percent of average loans for the same 2003 period. Net charge-offs benefited from a $0.6 million commercial loan recovery during the second quarter of 2004.
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Nonperforming Assets
Nonaccrual loans at June 30, 2004 decreased to $12.5 million compared to $14.9 million at December 31, 2003. The decrease includes the sale of $2.1 million of nonaccrual mortgage loans in the first quarter of 2004. OREO decreased to $6.2 million at June 30, 2004 from $6.8 million at December 31, 2003.
Asset Quality Ratios
As a result of the Corporation’s continued focus on asset quality and the initiatives taken in 2003 and in the first half of 2004, our asset quality ratios remain strong as evidenced in the following table.
Asset Quality(1)
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| | | June 30 | | March 31 | | December 31 | | September 30 | June 30 | |
| | | 2004
| | 2004
| | 2003
| | 2003
| 2003
| |
Past Due Ratio | | | | | | | | | | | | | | | | | | | | |
| Past due loans over 30 days as a percentage of loans | | | 0.47 | % | | | 0.64 | % | | | 1.04 | % | | | 0.71 | % | | | 0.67 | % |
Nonaccrual Loans | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans as a percentage of loans | | | 0.53 | % | | | 0.52 | % | | | 0.66 | % | | | 0.64 | % | | | 0.54 | % |
Nonperforming Assets | | | | | | | | | | | | | | | | | | | | |
| Nonperforming assets as a percentage of loans and other real estate owned | | | 0.79 | % | | | 0.79 | % | | | 0.96 | % | | | 0.95 | % | | | 0.87 | % |
Charge-offs | | | | | | | | | | | | | | | | | | | | |
| Net charge-offs as a percentage of average loans-annualized | | | 0.29 | % | | | 0.41 | % | | | 0.35 | % | | | 0.40 | % | | | 0.39 | % |
Allowance for Loan Losses | | | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses as a percentage of loans | | | 1.11 | % | | | 1.13 | % | | | 1.14 | % | | | 1.14 | % | | | 1.15 | % |
| Allowance for loan losses as a percentage of nonaccrual loans | | | 208 | % | | | 217 | % | | | 172 | % | | | 179 | % | | | 212 | % |
| (1) | | Excludes loans held for sale. |
Allowance for Loan Losses
The allowance for loan losses as a percentage of total loans decreased to 1.11 percent at June 30, 2004 compared to 1.14 percent at December 31, 2003. The allowance for loan losses decreased primarily due to improved asset quality trends as well as a change in the mix of the loan portfolio towards 1-4 family mortgages and home equity lines of credit. This type of secured lending generally carries lower credit risk and thus requires lower allocations in our allowance model. First Charter monitors the adequacy of the allowance for loan losses to cover inherent losses in the loan portfolio through the use of a loan loss migration model. Management believes the Corporation is adequately reserved based on its assessment of its credit risk profile.
Conference Call
First Charter executive management will be available via telephone conference to discuss the contents of this press release, present growth and earnings estimates for the third quarter and the remainder of 2004 on Tuesday, July 13, 2004 at 11:00 a.m. The following table outlines access information for the conference call and internet/audio replay:
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| | | US/Canada Participants
| | International Participants
|
Live Conference Call | | 800-379-3953
ID # 8498472 | | 706-679-5254
ID # 8498472 |
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Internet Live and Replay | | www.FirstCharter.com
“Investor Relations” section
SHOW # 174965 | | www.FirstCharter.com
“Investor Relations” section
SHOW # 174965 |
| | | | | |
Audio Replay | | 800-642-1687
ID # 8498472 | | 706-645-9291
ID # 8498472 |
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Corporate Profile
First Charter Corporation is a regional financial services company with assets of $4.3 billion and is the holding company for First Charter Bank. First Charter operates 54 financial centers, six insurance offices and 93 ATMs located in 18 counties throughout the piedmont and western half of North Carolina. First Charter also operates one mortgage origination office in Virginia. First Charter provides businesses and individuals with a broad range of financial services, including banking, financial planning, funds management, investments, insurance, mortgages and a full array of employee benefit programs. Additional information about First Charter can be found by visitingwww.FirstCharter.comor by calling 1-800-601-8471. First Charter’s common stock is traded under the symbol “FCTR” on the NASDAQ National Market.
Forward Looking Statements
This news release contains forward looking statements with respect to the financial conditions and results of operations of First Charter Corporation. These forward looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward looking statements include, among others, the following possibilities: (1) projected results in connection with the implementation of our business plan and strategic initiatives are lower than expected; (2) competitive pressure among financial services companies increases significantly; (3) costs or difficulties related to the integration of acquisitions or expenses in general are greater than expected; (4) general economic conditions, in the markets in which the Corporation does business, are less favorable than expected; (5) risks inherent in making loans, including repayment risks and risks associated with collateral values, are greater than expected; (6) changes in the interest rate environment reduce interest margins and affect funding sources; (7) changes in market rates and prices may adversely affect the value of financial products; (8) legislation or regulatory requirements or changes thereto adversely affect the businesses in which the Corporation is engaged; (9) regulatory compliance cost increases are greater than expected; and (10) decisions to change the business mix of the Corporation. For further information and other factors which could affect the accuracy of forward looking statements, please see First Charter’s reports filed with the SEC pursuant to the Securities Exchange Act of 1934 which are available at the SEC’s website (www.sec.gov) or at First Charter’s website (www.FirstCharter.com). Readers are cautioned not to place undue reliance on these forward looking statements, which reflect management’s judgments only as of the date hereof. The Corporation undertakes no obligation to publicly revise those forward looking statements to reflect events and circumstances that arise after the date hereof.
(Selected financial information is attached)
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| | | |
First Charter Corporation and Subsidiaries | | (NASDAQ: FCTR) |
Quarterly Earnings Release | | |
| | | | | | | | | | | | | | | | | |
| | | As of / For the Six Months Ended
| | Increase (Decrease)
|
(Dollars in thousands, except per share data)
| | 6/30/2004
| | 6/30/2003
| | Amount
| | Percentage
|
BALANCE SHEET | | | | | | | | | | | | | | | | |
| ASSETS: | | | | | | | | | | | | | | | | |
| Cash and due from banks | | $ | 94,749 | | | $ | 103,199 | | | $ | (8,450 | ) | | | (8.2 | )% |
| Federal funds sold | | | 1,960 | | | | 1,233 | | | | 727 | | | | 59.0 | |
| Interest earning bank deposits | | | 19,513 | | | | 38,308 | | | | (18,795 | ) | | | (49.1 | ) |
| Securities available for sale | | | 1,604,585 | | | | 1,518,918 | | | | 85,667 | | | | 5.6 | |
| Loans held for sale | | | 26,768 | | | | 45,311 | | | | (18,543 | ) | | | (40.9 | ) |
| Loans | | | | | | | | | | | | | | | | |
| Commercial Real Estate | | | 768,637 | | | | 765,303 | | | | 3,334 | | | | 0.4 | |
| Commercial Non Real Estate | | | 208,587 | | | | 212,753 | | | | (4,166 | ) | | | (2.0 | ) |
| Construction | | | 332,031 | | | | 209,926 | | | | 122,105 | | | | 58.2 | |
| Mortgage | | | 315,005 | | | | 257,236 | | | | 57,769 | | | | 22.5 | |
| Consumer | | | 276,236 | | | | 271,734 | | | | 4,502 | | | | 1.7 | |
| Home equity | | | 447,739 | | | | 347,716 | | | | 100,023 | | | | 28.8 | |
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| Total loans | | | 2,348,235 | | | | 2,064,668 | | | | 283,567 | | | | 13.7 | |
| Less: Unearned income | | | (197 | ) | | | (209 | ) | | | 12 | | | | (5.7 | ) |
| Allowance for loan losses | | | (26,052 | ) | | | (23,644 | ) | | | (2,408 | ) | | | 10.2 | |
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| Loans, net | | | 2,321,986 | | | | 2,040,815 | | | | 281,171 | | | | 13.8 | |
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| | | |
| |
| Other assets | | | 269,652 | | | | 240,750 | | | | 28,902 | | | | 12.0 | |
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| | | |
| |
| Total assets | | $ | 4,339,213 | | | $ | 3,988,534 | | | $ | 350,679 | | | | 8.8 | % |
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| LIABILITIES AND SHAREHOLDERS’ EQUITY: | | | | | | | | | | | | | | | | |
| Deposits | | | | | | | | | | | | | | | | |
| Noninterest-bearing deposits | | $ | 368,738 | | | $ | 341,176 | | | $ | 27,562 | | | | 8.1 | % |
| Interest checking and savings | | | 450,950 | | | | 409,415 | | | | 41,535 | | | | 10.1 | |
| Money market deposits | | | 563,523 | | | | 535,021 | | | | 28,502 | | | | 5.3 | |
| Time deposits | | | 1,211,554 | | | | 1,272,937 | | | | (61,383 | ) | | | (4.8 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Total deposits | | | 2,594,765 | | | | 2,558,549 | | | | 36,216 | | | | 1.4 | |
| Other borrowings | | | 1,410,481 | | | | 1,076,595 | | | | 333,886 | | | | 31.0 | |
| Other liabilities | | | 50,186 | | | | 39,474 | | | | 10,712 | | | | 27.1 | |
| | | |
| | | |
| | | |
| | | |
| |
| Total liabilities | | | 4,055,432 | | | | 3,674,618 | | | | 380,814 | | | | 10.4 | |
| | | |
| | | |
| | | |
| | | |
| |
| Total shareholders’ equity | | | 283,781 | | | | 313,916 | | | | (30,135 | ) | | | (9.6 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Total liabilities and shareholders’ equity | | $ | 4,339,213 | | | $ | 3,988,534 | | | $ | 350,679 | | | | 8.8 | % |
| | | |
| | | |
| | | |
| | | |
| |
SELECTED AVERAGE BALANCES | | | | | | | | | | | | | | | | |
| Loans and loans held for sale | | $ | 2,306,505 | | | $ | 2,145,946 | | | $ | 160,559 | | | | 7.5 | % |
| Securities | | | 1,614,000 | | | | 1,354,558 | | | | 259,442 | | | | 19.2 | |
| Interest earning assets | | | 3,940,172 | | | | 3,561,743 | | | | 378,429 | | | | 10.6 | |
| Assets | | | 4,263,381 | | | | 3,893,661 | | | | 369,720 | | | | 9.5 | |
| Deposits | | | 2,492,291 | | | | 2,449,733 | | | | 42,558 | | | | 1.7 | |
| Interest bearing liabilities | | | 3,572,821 | | | | 3,212,849 | | | | 359,972 | | | | 11.2 | |
| Shareholders’ equity | | | 299,848 | | | | 325,699 | | | | (25,851 | ) | | | (7.9 | ) |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended
|
| | | 6/30/2004
| | 3/31/2004
| | 12/31/2003
| | 9/30/2003
| | 6/30/2003
|
MISCELLANEOUS INFORMATION | | | | | | | | | | | | | | | | | | | | |
| Common stock prices (daily close) | | | | | | | | | | | | | | | | | | | | |
| High | | $ | 21.89 | | | $ | 21.68 | | | $ | 21.20 | | | $ | 20.40 | | | $ | 19.56 | |
| Low | | | 20.05 | | | | 19.52 | | | | 19.27 | | | | 17.04 | | | | 16.69 | |
| End of period | | | 21.79 | | | | 21.14 | | | | 19.55 | | | | 19.60 | | | | 17.59 | |
| Book Value | | | 9.53 | | | | 10.38 | | | | 10.08 | | | | 10.20 | | | | 10.55 | |
| Market Capitalization | | | 648,666,205 | | | | 628,876,525 | | | | 581,029,187 | | | | 581,005,034 | | | | 523,475,726 | |
| Weighted average shares - basic | | | 29,763,619 | | | | 29,738,553 | | | | 29,685,088 | | | | 29,672,137 | | | | 29,801,059 | |
| Weighted average shares - diluted | | | 30,067,462 | | | | 30,029,056 | | | | 29,685,088 | | | | 29,904,440 | | | | 29,801,059 | |
| End of period shares outstanding | | | 29,768,986 | | | | 29,748,180 | | | | 29,720,163 | | | | 29,643,114 | | | | 29,759,848 | |
10
| | | |
First Charter Corporation and Subsidiaries | | (NASDAQ: FCTR) |
Quarterly Earnings Release | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended
|
(Dollars in thousands, except per share data)
| | 6/30/2004
| | 3/31/2004
| | 12/31/2003
| | 9/30/2003
| | 6/30/2003
|
BALANCE SHEET | | | | | | | | | | | | | | | | | | | | |
| ASSETS: | | | | | | | | | | | | | | | | | | | | |
| Cash and due from banks | | $ | 94,749 | | | $ | 75,040 | | | $ | 88,564 | | | $ | 84,468 | | | $ | 103,199 | |
| Federal funds sold | | | 1,960 | | | | 1,723 | | | | 1,311 | | | | 2,004 | | | | 1,233 | |
| Interest earning bank deposits | | | 19,513 | | | | 17,951 | | | | 23,631 | | | | 42,560 | | | | 38,308 | |
| Securities available for sale | | | 1,604,585 | | | | 1,622,967 | | | | 1,601,900 | | | | 1,603,262 | | | | 1,518,918 | |
| Loans held for sale | | | 26,768 | | | | 17,969 | | | | 5,137 | | | | 14,784 | | | | 45,311 | |
| Loans | | | | | | | | | | | | | | | | | | | | |
| Commercial Real Estate | | | 768,637 | | | | 749,355 | | | | 724,340 | | | | 732,434 | | | | 765,303 | |
| Commercial Non Real Estate | | | 208,587 | | | | 210,010 | | | | 212,010 | | | | 199,412 | | | | 212,753 | |
| Construction | | | 332,031 | | | | 346,109 | | | | 358,217 | | | | 275,005 | | | | 209,926 | |
| Mortgage | | | 315,005 | | | | 288,505 | | | | 280,748 | | | | 258,927 | | | | 257,236 | |
| Consumer | | | 276,236 | | | | 271,686 | | | | 284,448 | | | | 279,512 | | | | 271,734 | |
| Home equity | | | 447,739 | | | | 414,410 | | | | 393,041 | | | | 364,191 | | | | 347,716 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total loans | | | 2,348,235 | | | | 2,280,075 | | | | 2,252,804 | | | | 2,109,481 | | | | 2,064,668 | |
| Less: Unearned income | | | (197 | ) | | | (209 | ) | | | (167 | ) | | | (190 | ) | | | (209 | ) |
| Allowance for loan losses | | | (26,052 | ) | | | (25,736 | ) | | | (25,607 | ) | | | (23,953 | ) | | | (23,644 | ) |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Loans, net | | | 2,321,986 | | | | 2,254,130 | | | | 2,227,030 | | | | 2,085,338 | | | | 2,040,815 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Other assets | | | 269,652 | | | | 258,081 | | | | 259,120 | | | | 255,551 | | | | 240,750 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total assets | | $ | 4,339,213 | | | $ | 4,247,861 | | | $ | 4,206,693 | | | $ | 4,087,967 | | | $ | 3,988,534 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| LIABILITIES AND SHAREHOLDERS’ EQUITY: | | | | | | | | | | | | | | | | | | | | |
| Deposits | | | | | | | | | | | | | | | | | | | | |
| Noninterest-bearing deposits | | $ | 368,738 | | | $ | 353,133 | | | $ | 326,679 | | | $ | 337,409 | | | $ | 341,176 | |
| Interest checking and savings | | | 450,950 | | | | 454,024 | | | | 440,496 | | | | 425,219 | | | | 409,415 | |
| Money market deposits | | | 563,523 | | | | 506,504 | | | | 470,551 | | | | 534,148 | | | | 535,021 | |
| Time deposits | | | 1,211,554 | | | | 1,193,781 | | | | 1,190,171 | | | | 1,184,806 | | | | 1,272,937 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total deposits | | | 2,594,765 | | | | 2,507,442 | | | | 2,427,897 | | | | 2,481,582 | | | | 2,558,549 | |
| Other borrowings | | | 1,410,481 | | | | 1,377,374 | | | | 1,432,200 | | | | 1,261,412 | | | | 1,076,595 | |
| Other liabilities | | | 50,186 | | | | 54,308 | | | | 47,157 | | | | 42,710 | | | | 39,474 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total liabilities | | | 4,055,432 | | | | 3,939,124 | | | | 3,907,254 | | | | 3,785,704 | | | | 3,674,618 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total shareholders’ equity | | | 283,781 | | | | 308,737 | | | | 299,439 | | | | 302,263 | | | | 313,916 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total liabilities and shareholders’ equity | | $ | 4,339,213 | | | $ | 4,247,861 | | | $ | 4,206,693 | | | $ | 4,087,967 | | | $ | 3,988,534 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
SELECTED AVERAGE BALANCES | | | | | | | | | | | | | | | | | | | | |
| Loans and loans held for sale | | $ | 2,339,435 | | | $ | 2,273,575 | | | $ | 2,188,643 | | | $ | 2,130,236 | | | $ | 2,179,291 | |
| Securities | | | 1,637,918 | | | | 1,590,083 | | | | 1,585,679 | | | | 1,560,430 | | | | 1,412,491 | |
| Interest earning assets | | | 3,995,390 | | | | 3,884,954 | | | | 3,792,383 | | | | 3,730,688 | | | | 3,648,447 | |
| Assets | | | 4,316,360 | | | | 4,210,401 | | | | 4,158,189 | | | | 4,062,106 | | | | 3,981,461 | |
| Deposits | | | 2,547,909 | | | | 2,436,673 | | | | 2,496,810 | | | | 2,543,301 | | | | 2,519,240 | |
| Interest bearing liabilities | | | 3,610,337 | | | | 3,535,305 | | | | 3,431,144 | | | | 3,381,916 | | | | 3,286,646 | |
| Shareholders’ equity | | | 296,699 | | | | 303,722 | | | | 304,097 | | | | 303,186 | | | | 325,728 | |
11
| | | |
First Charter Corporation and Subsidiaries | | (NASDAQ: FCTR) |
Quarterly Earnings Release | | |
| | | | | | | | | | | | | | | | | |
| | | For the Three Months Ended
| | Increase (Decrease)
|
(Dollars in thousands, except per share data)
| | 6/30/2004
| | 6/30/2003
| | Amount
| Percentage
|
INCOME STATEMENT | | | | | | | | | | | | | | | | |
| Interest income - taxable equivalent | | $ | 45,375 | | | $ | 45,689 | | | $ | (314 | ) | | | (0.7) | % |
| Interest expense | | | 14,874 | | | | 19,102 | | | | (4,228 | ) | | | (22.1 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income - taxable equivalent | | | 30,501 | | | | 26,587 | | | | 3,914 | | | | 14.7 | |
| Less: taxable equivalent adjustment | | | 469 | | | | 548 | | | | (79 | ) | | | (14.4 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income | | | 30,032 | | | | 26,039 | | | | 3,993 | | | | 15.3 | |
| Provision for loan losses | | | 2,000 | | | | 19,492 | | | | (17,492 | ) | | | (89.7 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income after provision for loan losses | | | 28,032 | | | | 6,547 | | | | 21,485 | | | | 328.2 | |
| Noninterest income | | | 14,890 | | | | 20,215 | | | | (5,325 | ) | | | (26.3 | ) |
| Noninterest expense | | | 27,685 | | | | 32,988 | | | | (5,303 | ) | | | (16.1 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Income before income taxes | | | 15,237 | | | | (6,226 | ) | | | 21,463 | | | | (344.7 | ) |
| Income tax expense (benefit) | | | 4,982 | | | | (2,022 | ) | | | 7,004 | | | | (346.4 | ) |
| | | |
| | | |
| | | |
| | | |
| |
Net income (loss) | | $ | 10,255 | | | $ | (4,204 | ) | | $ | 14,459 | | | | (343.9) | % |
| | | |
| | | |
| | | |
| | | |
| |
EARNINGS (LOSS) PER SHARE DATA | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.34 | | | $ | (0.14 | ) | | $ | 0.48 | | | | (342.9 | )% |
| Diluted | | | 0.34 | | | | (0.14 | ) | | | 0.48 | | | | (342.9 | ) |
| Weighted average shares - basic | | | 29,763,619 | | | | 29,801,059 | | | | | | | | | |
| Weighted average shares - diluted | | | 30,067,462 | | | | 29,801,059 | | | | | | | | | |
| Dividends paid on common shares | | $ | 0.185 | | | $ | 0.185 | | | $ | — | | | | — | % |
| | | |
| | | |
| | | |
| | | |
| |
PERFORMANCE RATIOS | | | | | | | | | | | | | | | | |
| Return on average assets | | | 0.96 | % | | | (0.42) | % | | | | | | | | |
| Return on average equity | | | 13.90 | | | | (5.18 | ) | | | | | | | | |
| Efficiency - taxable equivalent (*) | | | 61.66 | | | | 85.65 | | | | | | | | | |
| | | |
| | | |
| | | | | | | | | |
| | | | | | | | | |
| | | For the Three Months Ended
|
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS
| | 6/30/2004
| | 6/30/2003
|
| Noninterest income | | | | | | | | |
| Gain on sale of securities | | $ | 494 | | | $ | 8,286 | |
| Equity method investment loss | | | (76 | ) | | | (276 | ) |
| Trading (losses) gains | | | (5 | ) | | | 432 | |
| Noninterest expense | | | | | | | | |
| Prepayment costs on borrowings | | | — | | | | (7,366 | ) |
| | | |
| | | |
| |
Notes: Applicable ratios are annualized.
| * | | - Noninterest expense divided by the sum of taxable equivalent net interest income plus noninterest income less gain on sale of securities. |
12
| | | |
First Charter Corporation and Subsidiaries
Quarterly Earnings Release | | (NASDAQ: FCTR) |
| | | | | | | | | | | | | | | | | |
| | | For the Six Months Ended
| | Increase (Decrease)
|
(Dollars in thousands, except per share data)
| | 6/30/2004
| | 6/30/2003
| | Amount
| | Percentage
|
INCOME STATEMENT | | | | | | | | | | | | | | | | |
| Interest income - taxable equivalent | | $ | 91,112 | | | $ | 91,706 | | | $ | (594 | ) | | | (0.6) | % |
| Interest expense | | | 29,731 | | | | 37,887 | | | | (8,156 | ) | | | (21.5 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income - taxable equivalent | | | 61,381 | | | | 53,819 | | | | 7,562 | | | | 14.1 | |
| Less: taxable equivalent adjustment | | | 976 | | | | 1,197 | | | | (221 | ) | | | (18.5 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income | | | 60,405 | | | | 52,622 | | | | 7,783 | | | | 14.8 | |
| Provision for loan losses | | | 5,000 | | | | 21,543 | | | | (16,543 | ) | | | (76.8 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income after provision for loan losses | | | 55,405 | | | | 31,079 | | | | 24,326 | | | | 78.3 | |
| Noninterest income | | | 29,555 | | | | 35,754 | | | | (6,199 | ) | | | (17.3 | ) |
| Noninterest expense | | | 55,993 | | | | 59,021 | | | | (3,028 | ) | | | (5.1 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Income before income taxes | | | 28,967 | | | | 7,812 | | | | 21,155 | | | | 270.8 | |
| Income taxes | | | 9,472 | | | | 2,070 | | | | 7,402 | | | | 357.6 | |
| | | |
| | | |
| | | |
| | | |
| |
Net income | | $ | 19,495 | | | $ | 5,742 | | | $ | 13,753 | | | | 239.5 | % |
| | | |
| | | |
| | | |
| | | |
| |
EARNINGS PER SHARE DATA | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.65 | | | $ | 0.19 | | | $ | 0.46 | | | | 242.1 | % |
| Diluted | | | 0.65 | | | | 0.19 | | | | 0.46 | | | | 242.1 | |
| Weighted average shares - basic | | | 29,765,952 | | | | 29,903,170 | | | | | | | | | |
| Weighted average shares - diluted | | | 30,061,529 | | | | 30,079,806 | | | | | | | | | |
| Dividends paid on common shares | | $ | 0.370 | | | $ | 0.370 | | | $ | — | | | | — | % |
| | | |
| | | |
| | | |
| | | |
| |
PERFORMANCE RATIOS | | | | | | | | | | | | | | | | |
| Return on average assets | | | 0.92 | % | | | 0.30 | % | | | | | | | | |
| Return on average equity | | | 13.07 | | | | 3.56 | | | | | | | | | |
| Efficiency - taxable equivalent (*) | | | 62.13 | | | | 73.72 | | | | | | | | | |
| | | | | | | | | |
| | | For the Six Months Ended
|
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS
| | 6/30/2004
| | 6/30/2003
|
| Noninterest income | | | | | | | | |
| Gain on sale of securities | | $ | 820 | | | $ | 9,512 | |
| Gain on sale of credit card loans | | | — | | | | 2,213 | |
| Equity method investment loss | | | (300 | ) | | | (376 | ) |
| Trading gains | | | 104 | | | | 1,596 | |
| Gain on sale of properties | | | 777 | | | | — | |
| Noninterest expense | | | | | | | | |
| Prepayment costs on borrowings | | | — | | | | (7,366 | ) |
Notes: Applicable ratios are annualized
| | * | - Noninterest expense divided by the sum of taxable equivalent net interest income plus noninterest income less gain on sale of securities. |
13
| | | |
First Charter Corporation and Subsidiaries | | (NASDAQ: FCTR) |
Quarterly Earnings Release | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended
|
(Dollars in thousands, except per share data)
| | 6/30/2004
| | 3/31/2004
| | 12/31/2003
| | 9/30/2003
| | 6/30/2003
|
INCOME STATEMENT | | | | | | | | | | | | | | | | | | | | |
Interest income - taxable equivalent | | | | | | | | | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 29,373 | | | $ | 29,291 | | | $ | 29,282 | | | $ | 29,042 | | | $ | 30,593 | |
| Interest on securities | | | 15,960 | | | | 16,399 | | | | 15,743 | | | | 14,625 | | | | 14,931 | |
| Other interest income | | | 42 | | | | 47 | | | | 38 | | | | 97 | | | | 165 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total interest income - taxable equivalent | | | 45,375 | | | | 45,737 | | | | 45,063 | | | | 43,764 | | | | 45,689 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Interest expense | | | | | | | | | | | | | | | | | | | | |
| Interest on deposits | | | 8,619 | | | | 8,125 | | | | 8,449 | | | | 9,963 | | | | 11,667 | |
| Other interest expense | | | 6,255 | | | | 6,732 | | | | 7,121 | | | | 7,070 | | | | 7,435 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total interest expense | | | 14,874 | | | | 14,857 | | | | 15,570 | | | | 17,033 | | | | 19,102 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net interest income - taxable equivalent | | | 30,501 | | | | 30,880 | | | | 29,493 | | | | 26,731 | | | | 26,587 | |
| Less: Taxable equivalent adjustment | | | 469 | | | | 507 | | | | 513 | | | | 531 | | | | 548 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Net interest income | | | 30,032 | | | | 30,373 | | | | 28,980 | | | | 26,200 | | | | 26,039 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Provision for loan losses | | | 2,000 | | | | 3,000 | | | | 3,575 | | | | 2,400 | | | | 19,492 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Net interest income after provision for loan losses | | | 28,032 | | | | 27,373 | | | | 25,405 | | | | 23,800 | | | | 6,547 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Noninterest income | | | | | | | | | | | | | | | | | | | | |
| Service charges on deposit accounts | | | 6,346 | | | | 5,605 | | | | 5,768 | | | | 5,674 | | | | 5,571 | |
| Financial management income | | | 1,545 | | | | 1,502 | | | | 1,239 | | | | 1,400 | | | | 488 | |
| Gain on sale of securities | | | 494 | | | | 326 | | | | 505 | | | | 270 | | | | 8,286 | |
| Gain on sale of credit card loan portfolio | | | — | | | | — | | | | — | | | | 49 | | | | — | |
| (Loss) income from equity method investments | | | (76 | ) | | | (224 | ) | | | 13 | | | | 78 | | | | (276 | ) |
| Mortgage loan fees | | | 596 | | | | 428 | | | | 508 | | | | 1,185 | | | | 578 | |
| Brokerage services income | | | 902 | | | | 970 | | | | 857 | | | | 861 | | | | 812 | |
| Insurance services income | | | 2,634 | | | | 3,031 | | | | 2,415 | | | | 2,327 | | | | 2,229 | |
| Trading (losses) gains | | | (5 | ) | | | 109 | | | | 47 | | | | 158 | | | | 432 | |
| Bank owned life insurance | | | 847 | | | | 850 | | | | 983 | | | | 992 | | | | 967 | |
| Gain on sale of properties | | | — | | | | 777 | | | | — | | | | 382 | | | | — | |
| Other noninterest income | | | 1,607 | | | | 1,291 | | | | 1,144 | | | | 1,324 | | | | 1,128 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total noninterest income | | | 14,890 | | | | 14,665 | | | | 13,479 | | | | 14,700 | | | | 20,215 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
Noninterest expense | | | | | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 14,368 | | | | 15,023 | | | | 15,372 | | | | 13,133 | | | | 12,520 | |
| Occupancy and equipment | | | 4,379 | | | | 4,237 | | | | 4,346 | | | | 4,079 | | | | 3,913 | |
| Data processing | | | 1,006 | | | | 862 | | | | 792 | | | | 712 | | | | 634 | |
| Marketing | | | 1,126 | | | | 1,118 | | | | 948 | | | | 1,173 | | | | 1,161 | |
| Postage and supplies | | | 1,306 | | | | 1,271 | | | | 1,251 | | | | 982 | | | | 1,152 | |
| Professional services | | | 2,361 | | | | 2,712 | | | | 3,422 | | | | 3,158 | | | | 3,230 | |
| Telephone | | | 507 | | | | 494 | | | | 567 | | | | 584 | | | | 513 | |
| Amortization of intangibles | | | 96 | | | | 118 | | | | 152 | | | | 127 | | | | 77 | |
| Prepayment costs on borrowings | | | — | | | | — | | | | 11,723 | | | | — | | | | 7,366 | |
| Other noninterest expense | | | 2,536 | | | | 2,473 | | | | 2,792 | | | | 2,451 | | | | 2,422 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| |
| Total noninterest expense | | | 27,685 | | | | 28,308 | | | | 41,365 | | | | 26,399 | | | | 32,988 | |
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| | | |
| | | |
| | | |
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| |
| Income (loss) before taxes | | | 15,237 | | | | 13,730 | | | | (2,481 | ) | | | 12,101 | | | | (6,226 | ) |
| Income tax expense (benefit) | | | 4,982 | | | | 4,490 | | | | (1,991 | ) | | | 3,207 | | | | (2,022 | ) |
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| | | |
| | | |
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| |
Net income (loss) | | $ | 10,255 | | | $ | 9,240 | | | $ | (490 | ) | | $ | 8,894 | | | $ | (4,204 | ) |
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| |
EARNINGS (LOSS) PER SHARE DATA | | | | | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.34 | | | $ | 0.31 | | | $ | (0.02 | ) | | $ | 0.30 | | | $ | (0.14 | ) |
| Diluted | | | 0.34 | | | | 0.31 | | | | (0.02 | ) | | | 0.30 | | | | (0.14 | ) |
| Dividends paid on common shares | | | 0.185 | | | | 0.185 | | | | 0.185 | | | | 0.185 | | | | 0.185 | |
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| |
PERFORMANCE RATIOS | | | | | | | | | | | | | | | | | | | | |
| Return on average assets | | | 0.96 | % | | | 0.88 | % | | | (0.05 | )% | | | 0.87 | % | | | (0.42 | )% |
| Return on average equity | | | 13.90 | | | | 12.24 | | | | (0.64 | ) | | | 11.64 | | | | (5.18 | ) |
| Efficiency - taxable equivalent (*) | | | 61.66 | | | | 62.60 | | | | 97.41 | | | | 64.14 | | | | 85.65 | |
| Noninterest income as a percentage of total income | | | 33.15 | | | | 32.56 | | | | 31.75 | | | | 35.94 | | | | 43.70 | |
| Equity as a percentage of total assets | | | 6.54 | | | | 7.27 | | | | 7.12 | | | | 7.39 | | | | 7.87 | |
| Average earning assets as a percentage of average assets | | | 92.56 | | | | 92.27 | | | | 91.20 | | | | 91.84 | | | | 91.64 | |
| Average loans as a percentage of average deposits | | | 91.82 | | | | 93.31 | | | | 87.66 | | | | 83.76 | | | | 86.51 | |
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| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended
|
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS
| | 6/30/2004
| | 3/31/2004
| | 12/31/2003
| | 9/30/2003
| | 6/30/2003
|
| Noninterest income | | | | | | | | | | | | | | | | | | | | |
| Gain on sale of securities | | $ | 494 | | | $ | 326 | | | $ | 505 | | | $ | 270 | | | $ | 8,286 | |
| Gain on sale of credit card loans | | | — | | | | — | | | | — | | | | 49 | | | | — | |
| Equity method investment (loss) income | | | (76 | ) | | | (224 | ) | | | 13 | | | | 78 | | | | (276 | ) |
| Trading (losses) gains | | | (5 | ) | | | 109 | | | | 47 | | | | 158 | | | | 432 | |
| Gain on sale of properties | | | — | | | | 777 | | | | — | | | | 382 | | | | — | |
| Noninterest expense | | | | | | | | | | | | | | | | | | | | |
| Prepayment costs on borrowings | | | — | | | | — | | | | (11,723 | ) | | | — | | | | (7,366 | ) |
Notes: Applicable ratios are annualized.
* - Noninterest expense divided by the sum of taxable equivalent net interest income plus noninterest income less gain on sale of securities.
14
| | | |
First Charter Corporation and Subsidiaries | | (NASDAQ: FCTR) |
Quarterly Earnings Release | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended
|
(Dollars in thousands, except per share data)
| | 6/30/2004
| | 3/31/2004
| | 12/31/2003
| | 9/30/2003
| | 6/30/2003
|
ASSET QUALITY ANALYSIS | | | | | | | | | | | | | | | | | | | | |
Allowance for Loan Losses | | | | | | | | | | | | | | | | | | | | |
| Beginning balance | | $ | 25,736 | | | $ | 25,607 | | | $ | 23,953 | | | $ | 23,644 | | | $ | 26,495 | |
| Provision for loan losses | | | 2,000 | | | | 3,000 | | | | 3,575 | | | | 2,400 | | | | 19,492 | |
| Allowance related to loans sold | | | — | | | | (549 | ) | | | — | | | | — | | | | (20,236 | ) |
| Charge-offs | | | (2,472 | ) | | | (2,582 | ) | | | (2,304 | ) | | | (2,238 | ) | | | (2,448 | ) |
| Recoveries | | | 788 | | | | 260 | | | | 383 | | | | 147 | | | | 341 | |
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| Net charge-offs | | | (1,684 | ) | | | (2,322 | ) | | | (1,921 | ) | | | (2,091 | ) | | | (2,107 | ) |
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| Ending balance | | $ | 26,052 | | | $ | 25,736 | | | $ | 25,607 | | | $ | 23,953 | | | $ | 23,644 | |
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Nonperforming Assets and Loans 90 days or more past due accruing interest | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans | | $ | 12,533 | | | $ | 11,845 | | | $ | 14,910 | | | $ | 13,398 | | | $ | 11,144 | |
| Other real estate | | | 6,159 | | | | 6,199 | | | | 6,836 | | | | 6,709 | | | | 6,866 | |
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| Total nonperforming assets | | | 18,693 | | | | 18,044 | | | | 21,746 | | | | 20,107 | | | | 18,010 | |
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| Loans 90 days or more past due accruing interest | | | — | | | | — | | | | 21 | | | | 21 | | | | 312 | |
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Total | | $ | 18,693 | | | $ | 18,044 | | | $ | 21,767 | | | $ | 20,128 | | | $ | 18,322 | |
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| |
Asset Quality Ratios (*) | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans as a percentage of total loans | | | 0.53 | % | | | 0.52 | % | | | 0.66 | % | | | 0.64 | % | | | 0.54 | % |
| Nonperforming assets as a percentage of total assets | | | 0.43 | | | | 0.42 | | | | 0.52 | | | | 0.49 | | | | 0.45 | |
| Nonperforming assets as a percentage of total loans and other real estate | | | 0.79 | | | | 0.79 | | | | 0.96 | | | | 0.95 | | | | 0.87 | |
| Net charge-offs as a percentage of average loans (annualized) | | | 0.29 | | | | 0.41 | | | | 0.35 | | | | 0.40 | | | | 0.39 | |
| Allowance for loan losses as a percentage of loans | | | 1.11 | | | | 1.13 | | | | 1.14 | | | | 1.14 | | | | 1.15 | |
| Ratio of allowance for loan losses to: | | | | | | | | | | | | | | | | | | | | |
| Net charge-offs | | | 3.85 | x | | | 2.76 | x | | | 3.36 | x | | | 2.89 | x | | | 2.80 | x |
| Nonaccrual loans | | | 2.08 | | | | 2.17 | | | | 1.72 | | | | 1.79 | | | | 2.12 | |
| | | | | | | | | | | | | | | | | |
| | | As of / For the Six Months Ended
| | Increase (Decrease)
|
| | | 6/30/2004
| | 6/30/2003
| | Amount
| | Percentage
|
Allowance for Loan Losses | | | | | | | | | | | | | | | | |
| Beginning balance | | $ | 25,607 | | | $ | 27,204 | | | $ | (1,597 | ) | | | (5.9 | )% |
| Provision for loan losses | | | 5,000 | | | | 21,543 | | | | (16,543 | ) | | | (76.8 | ) |
| Allowance related to loans sold | | | (549 | ) | | | (20,783 | ) | | | 20,234 | | | | (97.4 | ) |
| Charge-offs | | | (5,054 | ) | | | (4,914 | ) | | | 140 | | | | 2.8 | |
| Recoveries | | | 1,048 | | | | 594 | | | | 454 | | | | 76.4 | |
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| Net charge-offs | | | (4,006 | ) | | | (4,320 | ) | | | (314 | ) | | | (7.3 | ) |
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| Ending balance | | $ | 26,052 | | | $ | 23,644 | | | $ | 2,408 | | | | 10.2 | % |
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| |
Asset Quality Ratios (*) | | | | | | | | | | | | | | | | |
| Net charge-offs as a percentage of average loans (annualized) | | | 0.35 | % | | | 0.41 | % | | | | | | | | |
| Ratio of allowance for loan losses to net charge-offs (annualized) | | | 3.24 | x | | | 2.71 | x | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | For the Quarter Ended
|
| | | 6/30/2004
| | 3/31/2004
| | 12/31/2003
| | 9/30/2003
| | 6/30/2003
|
ANNUALIZED INTEREST YIELDS / RATES (**) | | | | | | | | | | | | | | | | | | | | |
Interest income: | | | | | | | | | | | | | | | | | | | | |
| Yield on loans and loans held for sale | | | 5.05 | % | | | 5.18 | % | | | 5.31 | % | | | 5.41 | % | | | 5.63 | % |
| Yield on securities | | | 3.90 | | | | 4.13 | | | | 3.97 | | | | 3.75 | | | | 4.23 | |
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| Yield on interest earning assets | | | 4.56 | | | | 4.73 | | | | 4.73 | | | | 4.67 | | | | 5.02 | |
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Interest expense: | | | | | | | | | | | | | | | | | | | | |
| Cost of interest bearing deposits | | | 1.59 | | | | 1.55 | | | | 1.59 | | | | 1.80 | | | | 2.12 | |
| Cost of borrowings | | | 1.77 | | | | 1.89 | | | | 2.14 | | | | 2.38 | | | | 2.75 | |
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| Cost of interest bearing liabilities | | | 1.66 | | | | 1.69 | | | | 1.80 | | | | 2.00 | | | | 2.33 | |
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| Interest rate spread | | | 2.90 | | | | 3.04 | | | | 2.93 | | | | 2.67 | | | | 2.69 | |
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| Net yield on earning assets | | | 3.06 | % | | | 3.19 | % | | | 3.10 | % | | | 2.86 | % | | | 2.92 | % |
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Notes: Applicable ratios are annualized.
(*) - Excludes loans held for sale.
(**) - Fully taxable equivalent yields.
15
