Exhibit 99.1
NEWS RELEASE DATED 7-18-2005
| | | | | |
| | | For Additional Information,
Contact Charles A. Caswell,
Chief Financial Officer
(704) 688-4473 | | |
| | | or | | |
| | | Jan H. Hollar, | | |
| | | Director of Finance | | |
| | | (704) 688-4467 | | |
FOR IMMEDIATE RELEASE
July 18, 2005
First Charter Net Income Up 10% in 2nd Quarter
Net Income of $11.3 Million Fueled by Strong Growth in Loans and
Fee Income
Second Quarter 2005 Highlights
| | • | | Net Income Rose 10% to $11.3 Million Compared to Second Quarter 2004. |
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| | • | | Total Loans Grew an Annualized 23% During the Quarter, Fueled by Commercial and Consumer Loan Growth. |
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| | • | | Deposit, Insurance and Mortgage Fee Revenues Contributed to a 16% Increase in Noninterest Income Compared to Second Quarter 2004. |
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| | • | | Solid Credit Quality Continued with Annualized Net Charge-offs 0.19% of Average Loans. |
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| | • | | Average Noninterest Bearing Demand Deposits Grew $25.8 Million, or 7%, Compared to Second Quarter 2004. |
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| | • | | Quarterly Customer Satisfaction Survey Score was 82% “Very Satisfied”, Significantly Above the National Average of 58%. |
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| | • | | Securities Portfolio Decreased to 33% of Earning Assets from 40% a Year Ago. |
CHARLOTTE, North Carolina – First Charter Corporation (NASDAQ: FCTR) today reported that 2005 second quarter net income increased 10 percent to $11.3 million from $10.3 million in the same quarter a year ago. On a fully diluted per-share basis, net income increased to $0.37 from $0.34 a year ago. The improved performance was driven largely by strong growth in loans, broad-based growth in fee revenue, continued focus on expense management and solid credit quality.
Return on average assets and return on average equity were 1.00 percent and 14.12 percent, respectively, for the second quarter of 2005 compared to 0.96 percent and 13.90 percent for the second quarter of 2004 and 0.94 percent and 13.21 percent for the first quarter of 2005.
For the first six months of 2005, First Charter earned $21.6 million, or $0.71 per share, compared to $19.5 million, or $0.65 per share, a year earlier.
“Our double-digit growth in loans and fee revenue for the second quarter was driven by the disciplined execution of our Community Banking Model,” said Bob James, President & CEO of First Charter Corporation. “Building effective relationships with our customers enables us to compete effectively in the marketplace and achieve strong earnings growth.”
First Charter entered the Raleigh market during the first quarter, opening a loan production office and establishing teams to originate mortgage and construction loans to individuals and residential builders. The Corporation expects to open a new financial center in Raleigh during the fourth quarter of 2005 offering banking services for individuals and small businesses, commercial lending, mortgages, and brokerage services. In addition, the company anticipates opening an additional de novo financial center in Charlotte during the fourth quarter of 2005, bringing the total number of financial centers to 55 by year-end.
“We are very excited about the growth potential available to us in Raleigh,” James continued. “Raleigh is a vibrant, growing market and we believe that our competitive product offerings and proven track record of delivering exceptional service will attract individuals and businesses in this region. Our move into this market is another example of how we are pursuing our growth strategy.”
Financial Highlights
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| | | For the Three Months | | | For the Six Months | |
| | | Ended June 30 | | | Ended June 30 | |
| (Dollars in thousands,except per share data) | | 2005 | | | 2004 | | | 2005 | | | 2004 | |
Earnings | | | | | | | | | | | | | | | | |
Total revenues(1) | | $ | 48,607 | | | $ | 44,922 | | | $ | 94,995 | | | $ | 89,960 | |
| Net income | | | 11,280 | | | | 10,255 | | | | 21,589 | | | | 19,495 | |
| Diluted earnings per share | | | 0.37 | | | | 0.34 | | | | 0.71 | | | | 0.65 | |
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Financial Ratios | | | | | | | | | | | | | | | | |
| Return on average assets | | | 1.00 | % | | | 0.96 | % | | | 0.97 | % | | | 0.92 | % |
| Return on average equity | | | 14.12 | | | | 13.90 | | | | 13.67 | | | | 13.07 | |
Efficiency-taxable equivalent ratio(2) | | | 59.70 | | | | 61.56 | | | | 60.54 | | | | 62.06 | |
| | | | | | | | | | | | | | | | | |
Average Balance Sheet | | | | | | | | | | | | | | | | |
| Loans, net | | $ | 2,788,438 | | | $ | 2,339,435 | | | $ | 2,670,810 | | | $ | 2,306,505 | |
| Securities | | | 1,441,853 | | | | 1,637,918 | | | | 1,501,035 | | | | 1,614,000 | |
| Total assets | | | 4,543,846 | | | | 4,316,360 | | | | 4,492,094 | | | | 4,263,381 | |
| Total deposits | | | 2,689,390 | | | | 2,547,909 | | | | 2,659,757 | | | | 2,492,291 | |
| Other borrowings | | | 1,491,636 | | | | 1,424,556 | | | | 1,467,904 | | | | 1,427,342 | |
| Shareholders’ equity | | | 320,412 | | | | 296,699 | | | | 318,455 | | | | 299,848 | |
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Asset Quality Ratios(3) | | | | | | | | | | | | | | | | |
| Past due loans over 30 days as a percentage of loans | | | 0.45 | % | | | 0.47 | % | | | 0.45 | % | | | 0.47 | % |
| Allowance for loan losses as a percentage of loans | | | 1.02 | | | | 1.11 | | | | 1.02 | | | | 1.11 | |
| Allowance for loan losses as a percentage of nonaccrual loans | | | 294.50 | | | | 207.87 | | | | 294.50 | | | | 207.87 | |
| Net charge-offs as a percentage of average loans-annualized | | | 0.19 | | | | 0.29 | | | | 0.20 | | | | 0.35 | |
| (1) | | Net interest income plus noninterest income. |
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| (2) | | Noninterest expense divided by the sum of taxable equivalent net interest income plus noninterest income less gains or losses on sale of securities. |
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| (3) | | Ratios exclude loans held for sale. |
Strong Loan Growth in Second Quarter
Average total loans increased $461.7 million, or 20 percent, to $2.78 billion compared with the same quarter a year ago. The purchase of adjustable rate mortgage (ARM) loans in the first quarter of 2005
accounted for $212.1 million of the increase. Average consumer and home equity loans increased $106.2 million or 15 percent and average commercial and construction loans increased $83.6 million or 6 percent. Average mortgage loans increased $59.7 million, or 19 percent, excluding the first quarter mortgage loan purchase.
Total loans increased $154.0 million, or 23 percent annualized, to $2.86 billion compared to March 31, 2005. Commercial and construction loans increased $115.9 million, or 35 percent annualized. Home equity loans increased $22.2 million, or 19 percent annualized, and consumer loans increased $17.5 million, or 22 percent annualized. Mortgage loans decreased $1.6 million during the quarter.
Average total loans were $234.4 million, or 9 percent higher than the previous quarter. The purchase of mortgage loans in the first quarter of 2005 accounted for $105.3 million of the increase. Average commercial and construction loans increased $85.4 million, or 7 percent, and average consumer and home equity loans increased $32.4 million, or 4 percent.
Loan growth was largely due to strong performance in commercial and consumer lending. “An improving economy and heightened focus on the commercial market contributed to our loan growth in the second quarter,” James said. “Six new, highly experienced commercial relationship officers recently joined First Charter and we are beginning to see the benefits of their activities in our commercial loan pipeline.”
Low-Cost Noninterest Deposit Balances Continue To Build
First Charter’sCHeckingAccountMarketingProgram (CHAMP) continued to attract new customers and generate low-cost deposits. Average noninterest bearing deposits grew by $25.8 million, or 7 percent, from the same period a year ago. Contributing to the growth, 10,322 new checking accounts were opened during the quarter, representing an 8 percent increase over the same period in 2004. This program is designed to develop new customer relationships, shift First Charter’s funding mix towards lower-cost funding sources and generate additional fee income opportunities.
Total average deposits increased $141.5 million, or 6 percent, to $2.69 billion compared to the same quarter a year ago. Average noninterest bearing deposits grew by $25.8 million, or 7 percent. Average interest bearing checking and savings deposits increased $20.1 million, or 4 percent, while average money market deposits decreased $103.0 million, or 19 percent. Average retail certificates of deposit (CDs) increased $90.8 million and average wholesale CDs increased $110.8 million. The increase in wholesale CDs is a part of the Corporation’s strategy to diversify its wholesale funding sources as evidenced by a $92.9 million decrease in Federal Home Loan Bank advances during the same period. In addition, during the second quarter the Corporation issued $35 million in floating rate trust-preferred securities to reduce existing debt and raise additional capital to support franchise growth.
Net Interest Margin Impacted by Wholesale Borrowing Costs
The net interest margin on a tax equivalent basis decreased to 3.03 percent in the second quarter of 2005 from 3.07 percent for the same period in 2004 and 3.06 percent in the first quarter of 2005. Net interest income increased $1.3 million, or 4 percent, to $31.3 million compared to the second quarter of 2004, and increased $0.7 million, or 2 percent, compared to the first quarter of 2005.
The net interest margin was negatively impacted by an 89 basis point increase in the cost of interest bearing liabilities compared to the second quarter of 2004. This increase was driven by a 144 basis point increase in other borrowing costs, primarily in wholesale borrowings, while deposit yields only increased 54 basis points.
Partially offsetting higher liability costs was a 75 basis point increase in earning asset yields. This increase was attributable to a 99 basis point improvement in loan yields, while securities yields remained flat.
The securities-available-for-sale portfolio was reduced by $27.6 million, or 8 percent annualized, during the second quarter of 2005 as portfolio cash flows were primarily used to fund loan growth. As a part of the Corporation’s strategy to de-emphasize its reliance on securities portfolio earnings, the securities portfolio has been reduced to 33 percent of earning assets at June 30, 2005, from 40 percent at June 30, 2004.
Noninterest Income Benefits From Greater Fee Revenue
Noninterest income increased $2.4 million, or 16 percent, to $17.3 million from the second quarter of 2004. Noninterest income was impacted during the second quarter of 2005 by Bank Owned Life Insurance (“BOLI”) claims of $0.9 million (nontaxable), a $0.2 million gain on the sale of bank property and a $0.2 million loss on equity method investments. Excluding these unique transactions, noninterest income increased $1.5 million, or 10 percent, compared to the second quarter of 2004. Noninterest income was also affected by a $0.7 million increase in service charges, a $0.6 million increase in other noninterest income related to growth in ATM, debit card and other miscellaneous fees, a $0.5 million increase in insurance revenues primarily due to the integration of a recently purchased insurance agency, and a $0.2 million increase in mortgage loan fees. Securities sale gains were $18,000 in the second quarter of 2005 compared to $0.5 million in the second quarter of 2004, as the Corporation decreased its emphasis on securities gains.
Noninterest income increased $1.5 million, or 10 percent, compared to the first quarter of 2005. The increase was driven by BOLI claims of $0.9 million during the second quarter of 2005, a $0.8 million, or 13 percent, increase in service charges and a $0.4 million increase in mortgage loan fees. These gains were partially offset by a $0.4 million decrease in insurance revenues. In addition, property sale gains were $0.2 million in the second quarter of 2005 compared to $0.5 million in the first quarter of 2005.
In June 2005, the Corporation entered into an agreement to sell and leaseback one of its financial center properties while a replacement financial center is constructed on an adjacent property. The transaction resulted in a gain of $1.3 million that will be recognized over the expected lease term of seven months. One-seventh, or $0.2 million, of the gain was recognized in the second quarter of 2005.
Continued Focus on Expense Management
Noninterest expense increased $1.7 million, or 6 percent, to $29.4 million compared to the second quarter of 2004. A significant contributor to the increase included a one-time $1.1 million expense associated with a legacy employee benefit plan. Salaries and employee benefits increased an additional $0.5 million, or 3 percent, due to additional personnel, including the acquisition of an insurance agency during the fourth quarter of 2004. Data processing expenses increased $0.3 million due to increased debit card processing and software maintenance expenses; occupancy and equipment increased $0.3 million due to additional branch lease and depreciation expenses. These increases were partially offset by a $0.4 million decrease in professional fees.
Noninterest expense increased $0.5 million, or 2 percent, compared to the first quarter of 2005. Noninterest expense for the second quarter of 2005 was impacted by the previously discussed $1.1 million employee benefit expense. Noninterest expense for the first quarter of 2005 was impacted by a previously disclosed $1.0 million expense associated with the former CFO’s retirement. Salaries and employee benefits increased $0.3 million as a result of one additional business day in the second quarter of 2005 and increased commission-based compensation in the mortgage services area. In addition, occupancy and equipment increased $0.3 million due to additional financial center lease and depreciation expenses.
Efficiency Ratio Improves
The efficiency ratio decreased to 59.7 percent from 61.6 percent in the second quarter of 2004, and 61.4 percent for the first quarter of 2005. The calculation of the efficiency ratio excludes the impact of securities sales.
Asset Quality Trends Continue To Improve
Asset quality trends continue to be solid. Net charge-offs were reduced significantly, falling to 0.19 percent of average total loans in the second quarter of 2005 from 0.29 percent in the same quarter a year-ago, and 0.21 in the first quarter of 2005.
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| | | Asset Quality Ratios | |
| | | June 30 | | | March 31 | | | December 31 | | | September 30 | | | June 30 | |
| | | 2005 | | | 2005 | | | 2004 | | | 2004 | | | 2004 | |
Past Due | | | | | | | | | | | | | | | | | | | | |
| Past due loans over 30 days as a percentage of loans | | | 0.45 | % | | | 0.51 | % | | | 0.51 | % | | | 0.61 | % | | | 0.47 | % |
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Nonaccrual Loans | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans as a percentage of loans | | | 0.34 | % | | | 0.34 | % | | | 0.57 | % | | | 0.59 | % | | | 0.53 | % |
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Nonperforming Assets | | | | | | | | | | | | | | | | | | | | |
| Nonperforming assets as a percentage of loans and other real estate owned | | | 0.57 | % | | | 0.62 | % | | | 0.73 | % | | | 0.79 | % | | | 0.79 | % |
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Charge-offs | | | | | | | | | | | | | | | | | | | | |
| Net charge-offs as a percentage of average loans-annualized | | | 0.19 | % | | | 0.21 | % | | | 0.30 | % | | | 0.13 | % | | | 0.29 | % |
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Allowance for Loan Losses | | | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses as a percentage of loans | | | 1.02 | % | | | 1.02 | % | | | 1.10 | % | | | 1.11 | % | | | 1.11 | % |
| Allowance for loan losses as a percentage of nonaccrual loans | | | 295 | % | | | 296 | % | | | 192 | % | | | 189 | % | | | 208 | % |
Nonperforming assets totaled $16.2 million at June 30, 2005, representing a $0.7 million decrease from March 31, 2005. Other real estate owned decreased $1.3 million compared to March 31, 2005 primarily due to the sale of three properties during the second quarter of 2005. Nonperforming assets as a percent of total loans and other real estate owned fell to 0.57 percent at June 30, 2005, compared to 0.62 percent at March 31, 2005.
The allowance for loan losses as a percent of total loans was 1.02 percent in the second quarter of 2005, the same as the previous quarter and a decrease from 1.11 percent in the same quarter a year-ago. The lower allowance for loan loss ratio is related to the increased proportion of lower-risk mortgage loans in the loan portfolio and the Corporation’s improved credit quality trends. The provision for loan losses was $2.9 million for the three months ended June 30, 2005 and net charge-offs were $1.3 million. For the three months ended June 30, 2004, the provision for loan losses was $2.0 million and net charge-offs were $1.7 million. The increase in the provision for loan losses from the second quarter of 2004 was primarily due to the inherent risk associated with increased lending.
Conference Call and 2005 Update
The First Charter executive management team will be available via telephone conference to discuss the contents of this press release, as well as an update on strategic plans for 2005 on Tuesday, July 19, 2005 at 10:00 a.m. EDT. 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 | | 706-679-5254 |
| | | ID # 7510335 | | ID # 7510335 |
Internet Live and Replay | | www.FirstCharter.com | | www.FirstCharter.com |
| | | “Investor Relations” section | | “Investor Relations” section |
| | | SHOW # 244805 | | SHOW # 244805 |
Audio Replay | | 800-642-1687 | | 706-645-9291 |
| | | ID # 7510335 | | ID # 7510335 |
Corporate Profile
First Charter Corporation is a regional financial services company with assets of $4.6 billion and is the holding company for First Charter Bank. First Charter operates 53 financial centers, seven insurance offices and 110 ATMs located in 18 counties throughout the piedmont and western half of North Carolina. First Charter also operates loan origination offices in Raleigh, NC and Reston, VA. 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 may be found by visitingwww.FirstCharter.com or 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, and which may be beyond our control, include,
among others, the following possibilities: (1) projected results in connection with management’s implementation of, or changes in, 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, including deposit attrition, customer retention and revenue loss, 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, or interest rate policies of the Board of Governors of the Federal Reserve System, may 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, including changes in accounting standards, may adversely affect the businesses in which the Corporation is engaged; (9) regulatory compliance cost increases are greater than expected; (10) the passage of future tax legislation, or any negative regulatory, administrative or judicial position, may adversely impact the Corporation; (11) our competitors may have greater financial resources and may develop products that enable them to compete more successfully in the markets in which we operate; and (12) changes in the securities markets, including changes in interest rates, may adversely affect our ability to raise capital from time to time. 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.
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First Charter Corporation and Subsidiaries
Quarterly Earnings Release | | (NASDAQ: FCTR) |
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| | | As of / For the Six Months Ended | | | Increase (Decrease) | |
| (Dollars in thousands, except per share data) | | 6/30/2005 | | | 6/30/2004 | | | Amount | | | Percentage | |
| |
BALANCE SHEET | | | | | | | | | | | | | | | | |
| ASSETS: | | | | | | | | | | | | | | | | |
| Cash and due from banks | | $ | 104,886 | | | $ | 94,749 | | | $ | 10,137 | | | | 10.7 | % |
| Federal funds sold | | | 2,250 | | | | 1,960 | | | | 290 | | | | 14.8 | |
| Interest earning bank deposits | | | 3,167 | | | | 19,513 | | | | (16,346 | ) | | | (83.8 | ) |
| Securities available for sale | | | 1,412,885 | | | | 1,604,585 | | | | (191,700 | ) | | | (11.9 | ) |
| Loans held for sale | | | 8,159 | | | | 26,768 | | | | (18,609 | ) | | | (69.5 | ) |
| Loans | | | | | | | | | | | | | | | | |
| Commercial Real Estate | | | 785,718 | | | | 768,637 | | | | 17,081 | | | | 2.2 | |
| Commercial Non Real Estate | | | 219,029 | | | | 208,587 | | | | 10,442 | | | | 5.0 | |
| Construction | | | 444,125 | | | | 332,031 | | | | 112,094 | | | | 33.8 | |
| Mortgage | | | 581,257 | | | | 315,005 | | | | 266,252 | | | | 84.5 | |
| Consumer | | | 328,163 | | | | 276,236 | | | | 51,927 | | | | 18.8 | |
| Home equity | | | 500,080 | | | | 447,739 | | | | 52,341 | | | | 11.7 | |
| | | |
| Total loans | | | 2,858,372 | | | | 2,348,235 | | | | 510,137 | | | | 21.7 | |
| Less: Unearned income | | | (213 | ) | | | (197 | ) | | | (16 | ) | | | 8.1 | |
| Allowance for loan losses | | | (29,032 | ) | | | (26,052 | ) | | | (2,980 | ) | | | 11.4 | |
| | | |
| Loans, net | | | 2,829,127 | | | | 2,321,986 | | | | 507,141 | | | | 21.8 | |
| | | |
| Other assets | | | 272,762 | | | | 269,652 | | | | 3,110 | | | | 1.2 | |
| | | |
| Total assets | | $ | 4,633,236 | | | $ | 4,339,213 | | | $ | 294,023 | | | | 6.8 | % |
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| | | | | | | | | | | | | | | | | |
| LIABILITIES AND SHAREHOLDERS’ EQUITY: | | | | | | | | | | | | | | | | |
| Deposits | | | | | | | | | | | | | | | | |
| Noninterest-bearing deposits | | $ | 406,982 | | | $ | 368,738 | | | $ | 38,244 | | | | 10.4 | % |
| Interest checking and savings | | | 475,643 | | | | 450,950 | | | | 24,693 | | | | 5.5 | |
| Money market deposits | | | 440,117 | | | | 563,523 | | | | (123,406 | ) | | | (21.9 | ) |
| Retail certificates of deposit | | | 994,671 | | | | 888,784 | | | | 105,887 | | | | 11.9 | |
| Wholesale certificates of deposit | | | 433,972 | | | | 322,770 | | | | 111,202 | | | | 34.5 | |
| | | |
| Total deposits | | | 2,751,385 | | | | 2,594,765 | | | | 156,620 | | | | 6.0 | |
| Retail other borrowings | | | 118,557 | | | | 129,404 | | | | (10,847 | ) | | | (8.4 | ) |
| Wholesale other borrowings | | | 1,384,765 | | | | 1,281,077 | | | | 103,688 | | | | 8.1 | |
| | | |
| Total other borrowings | | | 1,503,322 | | | | 1,410,481 | | | | 92,841 | | | | 6.6 | |
| Other liabilities | | | 50,831 | | | | 50,186 | | | | 645 | | | | 1.3 | |
| | | |
| Total liabilities | | | 4,305,538 | | | | 4,055,432 | | | | 250,106 | | | | 6.2 | |
| | | |
| Total shareholders’ equity | | | 327,698 | | | | 283,781 | | | | 43,917 | | | | 15.5 | |
| | | |
| Total liabilities and shareholders’ equity | | $ | 4,633,236 | | | $ | 4,339,213 | | | $ | 294,023 | | | | 6.8 | % |
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SELECTED AVERAGE BALANCES | | | | | | | | | | | | | | | | |
| Loans and loans held for sale | | $ | 2,670,810 | | | $ | 2,306,505 | | | $ | 364,305 | | | | 15.8 | % |
| Securities | | | 1,501,035 | | | | 1,614,000 | | | | (112,965 | ) | | | (7.0 | ) |
| Interest earning assets | | | 4,179,587 | | | | 3,940,172 | | | | 239,415 | | | | 6.1 | |
| Assets | | | 4,492,094 | | | | 4,263,381 | | | | 228,713 | | | | 5.4 | |
| Noninterest bearing deposits | | | 380,421 | | | | 346,812 | | | | 33,609 | | | | 9.7 | |
| Deposits | | | 2,659,757 | | | | 2,492,291 | | | | 167,466 | | | | 6.7 | |
| Other borrowings | | | 1,467,904 | | | | 1,427,342 | | | | 40,562 | | | | 2.8 | |
| Interest bearing liabilities | | | 3,747,241 | | | | 3,572,821 | | | | 174,420 | | | | 4.9 | |
| Shareholders’ equity | | | 318,455 | | | | 299,848 | | | | 18,607 | | | | 6.2 | |
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| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended | |
| | | 6/30/2005 | | | 3/31/2005 | | | 12/31/2004 | | | 9/30/2004 | | | 6/30/2004 | |
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MISCELLANEOUS INFORMATION | | | | | | | | | | | | | | | | | | | | |
| Common stock prices (daily close) | | | | | | | | | | | | | | | | | | | | |
| High | | $ | 23.34 | | | $ | 25.74 | | | $ | 28.11 | | | $ | 24.50 | | | $ | 21.89 | |
| Low | | | 20.85 | | | | 22.33 | | | | 25.00 | | | | 20.86 | | | | 20.05 | |
| End of period | | | 21.97 | | | | 22.59 | | | | 26.17 | | | | 24.17 | | | | 21.79 | |
| Book Value | | | 10.73 | | | | 10.31 | | | | 10.47 | | | | 10.35 | | | | 9.53 | |
| Market Capitalization | | | 670,822,115 | | | | 683,929,554 | | | | 786,519,880 | | | | 720,988,635 | | | | 648,666,205 | |
| Weighted average shares-basic | | | 30,409,307 | | | | 30,234,683 | | | | 29,973,996 | | | | 29,810,917 | | | | 29,763,619 | |
| Weighted average shares-diluted | | | 30,679,636 | | | | 30,630,601 | | | | 30,605,826 | | | | 30,231,191 | | | | 30,067,462 | |
| End of period shares outstanding | | | 30,533,551 | | | | 30,275,766 | | | | 30,054,256 | | | | 29,829,898 | | | | 29,768,986 | |
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8
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First Charter Corporation and Subsidiaries
Quarterly Earnings Release | | (NASDAQ: FCTR) |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended | |
| (Dollars in thousands, except per share data) | | 6/30/2005 | | | 3/31/2005 | | | 12/31/2004 | | | 9/30/2004 | | | 6/30/2004 | |
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BALANCE SHEET | | | | | | | | | | | | | | | | | | | | |
| ASSETS: | | | | | | | | | | | | | | | | | | | | |
| Cash and due from banks | | $ | 104,886 | | | $ | 110,745 | | | $ | 90,238 | | | $ | 98,000 | | | $ | 94,749 | |
| Federal funds sold | | | 2,250 | | | | 1,951 | | | | 1,589 | | | | 2,080 | | | | 1,960 | |
| Interest earning bank deposits | | | 3,167 | | | | 5,507 | | | | 6,184 | | | | 9,259 | | | | 19,513 | |
| Securities available for sale | | | 1,412,885 | | | | 1,440,494 | | | | 1,652,732 | | | | 1,630,655 | | | | 1,604,585 | |
| Loans held for sale | | | 8,159 | | | | 6,006 | | | | 5,326 | | | | 5,468 | | | | 26,768 | |
| Loans | | | | | | | | | | | | | | | | | | | | |
| Commercial Real Estate | | | 785,718 | | | | 774,088 | | | | 776,474 | | | | 788,539 | | | | 768,637 | |
| Commercial Non Real Estate | | | 219,029 | | | | 210,990 | | | | 212,031 | | | | 210,214 | | | | 208,587 | |
| Construction | | | 444,125 | | | | 347,877 | | | | 332,264 | | | | 345,178 | | | | 332,031 | |
| Mortgage | | | 581,257 | | | | 582,893 | | | | 347,606 | | | | 331,249 | | | | 315,005 | |
| Consumer | | | 328,163 | | | | 310,690 | | | | 304,151 | | | | 290,569 | | | | 276,236 | |
| Home equity | | | 500,080 | | | | 477,884 | | | | 467,166 | | | | 459,527 | | | | 447,739 | |
| | | |
| Total loans | | | 2,858,372 | | | | 2,704,422 | | | | 2,439,692 | | | | 2,425,276 | | | | 2,348,235 | |
| Less: Unearned income | | | (213 | ) | | | (232 | ) | | | (291 | ) | | | (301 | ) | | | (197 | ) |
| Allowance for loan losses | | | (29,032 | ) | | | (27,483 | ) | | | (26,872 | ) | | | (26,859 | ) | | | (26,052 | ) |
| | | |
| Loans, net | | | 2,829,127 | | | | 2,676,707 | | | | 2,412,529 | | | | 2,398,116 | | | | 2,321,986 | |
| | | |
| Other assets | | | 272,762 | | | | 271,643 | | | | 263,007 | | | | 265,466 | | | | 269,652 | |
| | | |
| Total assets | | $ | 4,633,236 | | | $ | 4,513,053 | | | $ | 4,431,605 | | | $ | 4,409,044 | | | $ | 4,339,213 | |
| | | |
| |
| LIABILITIES AND SHAREHOLDERS’ EQUITY: | | | | | | | | | | | | | | | | | | | | |
| Deposits | | | | | | | | | | | | | | | | | | | | |
| Noninterest-bearing deposits | | $ | 406,982 | | | $ | 402,986 | | | $ | 377,793 | | | $ | 368,156 | | | $ | 368,738 | |
| Interest checking and savings | | | 475,643 | | | | 472,063 | | | | 468,292 | | | | 448,799 | | | | 450,950 | |
| Money market deposits | | | 440,117 | | | | 455,870 | | | | 478,314 | | | | 544,663 | | | | 563,523 | |
| Retail certificates of deposit | | | 994,671 | | | | 971,199 | | | | 967,884 | | | | 877,541 | | | | 888,784 | |
| Wholesale certificates of deposit | | | 433,972 | | | | 400,590 | | | | 317,563 | | | | 317,903 | | | | 322,770 | |
| | | |
| Total deposits | | | 2,751,385 | | | | 2,702,708 | | | | 2,609,846 | | | | 2,557,062 | | | | 2,594,765 | |
| Retail other borrowings | | | 118,557 | | | | 115,836 | | | | 139,039 | | | | 128,903 | | | | 129,404 | |
| Wholesale other borrowings | | | 1,384,765 | | | | 1,335,920 | | | | 1,310,697 | | | | 1,353,437 | | | | 1,281,077 | |
| | | |
| Total other borrowings | | | 1,503,322 | | | | 1,451,756 | | | | 1,449,736 | | | | 1,482,340 | | | | 1,410,481 | |
| Other liabilities | | | 50,831 | | | | 46,335 | | | | 57,336 | | | | 60,991 | | | | 50,186 | |
| | | |
| Total liabilities | | | 4,305,538 | | | | 4,200,799 | | | | 4,116,918 | | | | 4,100,393 | | | | 4,055,432 | |
| | | |
| Total shareholders’ equity | | | 327,698 | | | | 312,254 | | | | 314,687 | | | | 308,651 | | | | 283,781 | |
| | | |
| Total liabilities and shareholders’ equity | | $ | 4,633,236 | | | $ | 4,513,053 | | | $ | 4,431,605 | | | $ | 4,409,044 | | | $ | 4,339,213 | |
| | | |
| |
SELECTED AVERAGE BALANCES | | | | | | | | | | | | | | | | | | | | |
| Loans and loans held for sale | | $ | 2,788,438 | | | $ | 2,551,876 | | | $ | 2,444,827 | | | $ | 2,393,362 | | | $ | 2,339,435 | |
| Securities | | | 1,441,853 | | | | 1,560,874 | | | | 1,637,050 | | | | 1,627,156 | | | | 1,637,918 | |
| Interest earning assets | | | 4,236,232 | | | | 4,122,175 | | | | 4,101,708 | | | | 4,035,259 | | | | 3,995,390 | |
| Assets | | | 4,543,846 | | | | 4,439,768 | | | | 4,426,604 | | | | 4,343,207 | | | | 4,316,360 | |
| Noninterest bearing deposits | | | 387,898 | | | | 372,861 | | | | 388,725 | | | | 372,424 | | | | 362,129 | |
| Deposits | | | 2,689,390 | | | | 2,629,795 | | | | 2,614,161 | | | | 2,586,524 | | | | 2,547,909 | |
| Other borrowings | | | 1,491,636 | | | | 1,443,909 | | | | 1,441,129 | | | | 1,411,579 | | | | 1,424,556 | |
| Interest bearing liabilities | | | 3,793,128 | | | | 3,700,843 | | | | 3,666,565 | | | | 3,625,679 | | | | 3,610,337 | |
| Shareholders’ equity | | | 320,412 | | | | 316,476 | | | | 312,122 | | | | 296,539 | | | | 296,699 | |
| |
9
| | |
| First Charter Corporation and Subsidiaries | | (NASDAQ: FCTR) |
| Quarterly Earnings Release | | |
| | | | | | | | | | | | | | | | | |
| | | For the Three Months Ended | | | Increase (Decrease) | |
| (Dollars in thousands, except per share data) | | 6/30/2005 | | | 6/30/2004 | | | Amount | | | Percentage | |
| |
INCOME STATEMENT | | | | | | | | | | | | | | | | |
| Interest income-taxable equivalent | | $ | 56,199 | | | $ | 45,447 | | | $ | 10,752 | | | | 23.7 | % |
| Interest expense | | | 24,314 | | | | 14,874 | | | | 9,440 | | | | 63.5 | |
| | | |
| Net interest income-taxable equivalent | | | 31,885 | | | | 30,573 | | | | 1,312 | | | | 4.3 | |
| Less: taxable equivalent adjustment | | | 595 | | | | 541 | | | | 54 | | | | 10.0 | |
| | | |
| Net interest income | | | 31,290 | | | | 30,032 | | | | 1,258 | | | | 4.2 | |
| Provision for loan losses | | | 2,878 | | | | 2,000 | | | | 878 | | | | 43.9 | |
| | | |
| Net interest income after provision for loan losses | | | 28,412 | | | | 28,032 | | | | 380 | | | | 1.4 | |
| Noninterest income | | | 17,317 | | | | 14,890 | | | | 2,427 | | | | 16.3 | |
| Noninterest expense | | | 29,364 | | | | 27,685 | | | | 1,679 | | | | 6.1 | |
| | | |
| Income before income taxes | | | 16,365 | | | | 15,237 | | | | 1,128 | | | | 7.4 | |
| Income tax expense | | | 5,085 | | | | 4,982 | | | | 103 | | | | 2.1 | |
| | | |
Net income | | $ | 11,280 | | | $ | 10,255 | | | $ | 1,025 | | | | 10.0 | % |
| | | |
| |
EARNINGS PER SHARE DATA | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.37 | | | $ | 0.34 | | | $ | 0.03 | | | | 8.8 | % |
| Diluted | | | 0.37 | | | | 0.34 | | | | 0.03 | | | | 8.8 | |
| Weighted average shares-basic | | | 30,409,307 | | | | 29,763,619 | | | | | | | | | |
| Weighted average shares-diluted | | | 30,679,636 | | | | 30,067,462 | | | | | | | | | |
| Dividends paid on common shares | | $ | 0.190 | | | $ | 0.185 | | | $ | 0.005 | | | | 5.3 | % |
| |
PERFORMANCE RATIOS | | | | | | | | | | | | | | | | |
| Return on average assets | | | 1.00 | % | | | 0.96 | % | | | | | | | | |
| Return on average equity | | | 14.12 | | | | 13.90 | | | | | | | | | |
| Efficiency-taxable equivalent (*) | | | 59.70 | | | | 61.56 | | | | | | | | | |
| |
| | | | | | | | | |
| | | For the Three Months Ended | |
| | | 6/30/2005 | | | 6/30/2004 | |
| | | |
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS | | | | | | | | |
| Noninterest income | | | | | | | | |
| Gain on sale of securities | | $ | 18 | | | $ | 494 | |
| Equity method investment loss | | | (174 | ) | | | (76 | ) |
| Gain on sale of properties | | | 188 | | | | — | |
| Bank owned life insurance claim | | | 925 | | | | — | |
| Noninterest expense | | | | | | | | |
| Employee benefit plan modification | | | 1,079 | | | | — | |
| |
| | | |
| 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. |
10
| | |
First Charter Corporation and Subsidiaries
Quarterly Earnings Release | | (NASDAQ: FCTR) |
| | | | | | | | | | | | | | | | | |
| | | For the Six Months Ended | | | Increase (Decrease) | |
| (Dollars in thousands, except per share data) | | 6/30/2005 | | | 6/30/2004 | | | Amount | | | Percentage | |
| |
INCOME STATEMENT | | | | | | | | | | | | | | | | |
| Interest income-taxable equivalent | | $ | 108,056 | | | $ | 91,215 | | | $ | 16,841 | | | | 18.5 | % |
| Interest expense | | | 45,022 | | | | 29,731 | | | | 15,291 | | | | 51.4 | |
| | | |
| Net interest income-taxable equivalent | | | 63,034 | | | | 61,484 | | | | 1,550 | | | | 2.5 | |
| Less: taxable equivalent adjustment | | | 1,170 | | | | 1,079 | | | | 91 | | | | 8.4 | |
| | | |
| Net interest income | | | 61,864 | | | | 60,405 | | | | 1,459 | | | | 2.4 | |
| Provision for loan losses | | | 4,778 | | | | 5,000 | | | | (222 | ) | | | (4.4 | ) |
| | | |
| Net interest income after provision for loan losses | | | 57,086 | | | | 55,405 | | | | 1,681 | | | | 3.0 | |
| Noninterest income | | | 33,131 | | | | 29,555 | | | | 3,576 | | | | 12.1 | |
| Noninterest expense | | | 58,233 | | | | 55,993 | | | | 2,240 | | | | 4.0 | |
| | | |
| Income before income taxes | | | 31,984 | | | | 28,967 | | | | 3,017 | | | | 10.4 | |
| Income taxes | | | 10,395 | | | | 9,472 | | | | 923 | | | | 9.7 | |
| | | |
Net income | | $ | 21,589 | | | $ | 19,495 | | | $ | 2,094 | | | | 10.7 | % |
| | | |
| |
EARNINGS PER SHARE DAT | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.71 | | | $ | 0.65 | | | $ | 0.06 | | | | 9.2 | % |
| Diluted | | | 0.71 | | | | 0.65 | | | | 0.06 | | | | 9.2 | |
| Weighted average shares-basic | | | 30,285,244 | | | | 29,765,952 | | | | | | | | | |
| Weighted average shares-diluted | | | 30,607,931 | | | | 30,061,529 | | | | | | | | | |
| Dividends paid on common shares | | $ | 0.38 | | | $ | 0.37 | | | $ | 0.01 | | | | 2.7 | % |
| |
PERFORMANCE RATIOS | | | | | | | | | | | | | | | | |
| Return on average assets | | | 0.97 | % | | | 0.92 | % | | | | | | | | |
| Return on average equity | | | 13.67 | | | | 13.07 | | | | | | | | | |
| Efficiency-taxable equivalent (*) | | | 60.54 | | | | 62.06 | | | | | | | | | |
| |
| | | | | | | | | |
| | | For the Six Months Ended | |
| | | 6/30/2005 | | | 6/30/2004 | |
| | | |
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS | | | | | | | | |
| Noninterest income | | | | | | | | |
| (Loss) gain on sale of securities | | $ | (31 | ) | | $ | 820 | |
| Equity method investment loss | | | (232 | ) | | | (300 | ) |
| Gain on sale of properties | | | 717 | | | | 777 | |
| Bank owned life insurance claim | | | 925 | | | | — | |
| Noninterest expense | | | | | | | | |
| Employee benefit plan modification | | | 1,079 | | | | — | |
| Separation agreement | | | 1,010 | | | | — | |
| Financial management charge | | | 166 | | | | — | |
| |
| | | |
| Notes: | | Applicable ratios are annualized. |
| |
| |
| *-Noninterest expense divided by the sum of taxable equivalent net interest income plus noninterest income less (loss) gain on sale of securities. |
11
| | |
First Charter Corporation and Subsidiaries
Quarterly Earnings Release | | (NASDAQ: FCTR) |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended | |
| (Dollars in thousands, except per share data) | | 6/30/2005 | | | 3/31/2005 | | | 12/31/2004 | | | 9/30/2004 | | | 6/30/2004 | |
| |
INCOME STATEMENT | | | | | | | | | | | | | | | | | | | | |
Interest income-taxable equivalent | | | | | | | | | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 42,016 | | | $ | 36,499 | | | $ | 34,426 | | | $ | 31,406 | | | $ | 29,373 | |
| Interest on securities | | | 14,145 | | | | 15,306 | | | | 16,137 | | | | 16,144 | | | | 16,032 | |
| Other interest income | | | 38 | | | | 52 | | | | 87 | | | | 44 | | | | 42 | |
| | | |
| Total interest income-taxable equivalent | | | 56,199 | | | | 51,857 | | | | 50,650 | | | | 47,594 | | | | 45,447 | |
| | | |
Interest expense | | | | | | | | | | | | | | | | | | | | |
| Interest on deposits | | | 12,210 | | | | 10,514 | | | | 9,690 | | | | 8,916 | | | | 8,619 | |
| Other interest expense | | | 12,104 | | | | 10,194 | | | | 8,585 | | | | 7,371 | | | | 6,255 | |
| | | |
| Total interest expense | | | 24,314 | | | | 20,708 | | | | 18,275 | | | | 16,287 | | | | 14,874 | |
| | | |
| Net interest income-taxable equivalent | | | 31,885 | | | | 31,149 | | | | 32,375 | | | | 31,307 | | | | 30,573 | |
| Less: Taxable equivalent adjustment | | | 595 | | | | 575 | | | | 565 | | | | 512 | | | | 541 | |
| | | |
Net interest income | | | 31,290 | | | | 30,574 | | | | 31,810 | | | | 30,795 | | | | 30,032 | |
| Provision for loan losses | | | 2,878 | | | | 1,900 | | | | 1,825 | | | | 1,600 | | | | 2,000 | |
| | | |
Net interest income after provision for loan losses | | | 28,412 | | | | 28,674 | | | | 29,985 | | | | 29,195 | | | | 28,032 | |
| | | |
Noninterest income | | | | | | | | | | | | | | | | | | | | |
| Service charges on deposit accounts | | | 7,061 | | | | 6,236 | | | | 6,832 | | | | 6,781 | | | | 6,346 | |
| Financial management income | | | 1,596 | | | | 1,580 | | | | 1,199 | | | | 1,602 | | | | 1,545 | |
| Gain (loss) on sale of securities | | | 18 | | | | (49 | ) | | | 296 | | | | 1,267 | | | | 494 | |
| Gain on sale of deposits and loans | | | — | | | | — | | | | — | | | | 339 | | | | — | |
| Loss from equity method investments | | | (174 | ) | | | (58 | ) | | | (49 | ) | | | — | | | | (76 | ) |
| Mortgage loan fees | | | 817 | | | | 394 | | | | 359 | | | | 365 | | | | 596 | |
| Brokerage services income | | | 793 | | | | 802 | | | | 628 | | | | 612 | | | | 902 | |
| Insurance services income | | | 3,099 | | | | 3,512 | | | | 3,140 | | | | 2,464 | | | | 2,634 | |
| Bank owned life insurance | | | 1,762 | | | | 827 | | | | 856 | | | | 860 | | | | 847 | |
| Gain on sale of properties | | | 188 | | | | 529 | | | | — | | | | — | | | | — | |
| Other noninterest income | | | 2,157 | | | | 2,041 | | | | 2,041 | | | | 1,749 | | | | 1,602 | |
| | | |
| Total noninterest income | | | 17,317 | | | | 15,814 | | | | 15,302 | | | | 16,039 | | | | 14,890 | |
| | | |
Noninterest expense | | | | | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 15,908 | | | | 15,569 | | | | 14,323 | | | | 14,779 | | | | 14,368 | |
| Occupancy and equipment | | | 4,687 | | | | 4,381 | | | | 4,495 | | | | 4,115 | | | | 4,379 | |
| Data processing | | | 1,333 | | | | 1,321 | | | | 1,221 | | | | 945 | | | | 1,006 | |
| Marketing | | | 1,065 | | | | 1,080 | | | | 966 | | | | 1,141 | | | | 1,126 | |
| Postage and supplies | | | 1,187 | | | | 1,208 | | | | 1,178 | | | | 1,204 | | | | 1,306 | |
| Professional services | | | 1,984 | | | | 1,913 | | | | 2,237 | | | | 2,264 | | | | 2,361 | |
| Telephone | | | 551 | | | | 528 | | | | 501 | | | | 496 | | | | 507 | |
| Amortization of intangibles | | | 126 | | | | 131 | | | | 135 | | | | 111 | | | | 96 | |
| Other noninterest expense | | | 2,523 | | | | 2,738 | | | | 2,621 | | | | 2,292 | | | | 2,536 | |
| | | |
| Total noninterest expense | | | 29,364 | | | | 28,869 | | | | 27,677 | | | | 27,347 | | | | 27,685 | |
| | | |
| Income before taxes | | | 16,365 | | | | 15,619 | | | | 17,610 | | | | 17,887 | | | | 15,237 | |
| Income tax expense | | | 5,085 | | | | 5,310 | | | | 6,051 | | | | 6,499 | | | | 4,982 | |
| | | |
Net income | | $ | 11,280 | | | $ | 10,309 | | | $ | 11,559 | | | $ | 11,388 | | | $ | 10,255 | |
| | | |
| |
EARNINGS PER SHARE DATA | | | | | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.37 | | | $ | 0.34 | | | $ | 0.39 | | | $ | 0.38 | | | $ | 0.34 | |
| Diluted | | | 0.37 | | | | 0.34 | | | | 0.38 | | | | 0.38 | | | | 0.34 | |
| Dividends paid on common shares | | | 0.190 | | | | 0.190 | | | | 0.190 | | | | 0.190 | | | | 0.185 | |
| |
PERFORMANCE RATIOS | | | | | | | | | | | | | | | | | | | | |
| Return on average assets | | | 1.00 | % | | | 0.94 | % | | | 1.04 | % | | | 1.04 | % | | | 0.96 | % |
| Return on average equity | | | 14.12 | | | | 13.21 | | | | 14.73 | | | | 15.28 | | | | 13.90 | |
| Efficiency-taxable equivalent (*) | | | 59.70 | | | | 61.41 | | | | 58.41 | | | | 59.35 | | | | 61.56 | |
| Noninterest income as a percentage of total income | | | 35.63 | | | | 34.09 | | | | 32.48 | | | | 34.25 | | | | 33.15 | |
| Equity as a percentage of total assets | | | 7.07 | | | | 6.92 | | | | 7.10 | | | | 7.00 | | | | 6.54 | |
| Tangible equity as a percentage of total assets | | | 6.58 | | | | 6.41 | | | | 6.58 | | | | 6.49 | | | | 6.02 | |
| Tier 1 Capital to Risk Adjusted Assets | | | 10.70 | | | | 9.89 | | | | 10.08 | | | | 9.92 | | | | 9.92 | |
| Total Capital to Risk Adjusted Assets | | | 11.58 | | | | 10.78 | | | | 10.99 | | | | 10.84 | | | | 10.85 | |
| |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended | |
| | | 6/30/2005 | | | 3/31/2005 | | | 12/31/2004 | | | 9/30/2004 | | | 6/30/2004 | |
| | | |
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS | | | | | | | | | | | | | | | | | | | | |
| Noninterest income | | | | | | | | | | | | | | | | | | | | |
| Gain (loss) on sale of securities | | $ | 18 | | | $ | (49 | ) | | $ | 296 | | | $ | 1,267 | | | $ | 494 | |
| Gain on sale of deposits and loans | | | — | | | | — | | | | — | | | | 339 | | | | — | |
| Recovery on sale of overdraft deposit accounts | | | — | | | | — | | | | 222 | | | | — | | | | — | |
| Equity method investment loss | | | (174 | ) | | | (58 | ) | | | (49 | ) | | | — | | | | (76 | ) |
| Gain on sale of properties | | | 188 | | | | 529 | | | | — | | | | — | | | | — | |
| Bank owned life insurance claim | | | 925 | | | | — | | | | — | | | | — | | | | — | |
| Noninterest expense | | | | | | | | | | | | | | | | | | | | |
| Employee benefit plan modification | | | 1,079 | | | | — | | | | — | | | | — | | | | — | |
| Separation agreement | | | — | | | | 1,010 | | | | — | | | | — | | | | — | |
| Financial management charge | | | — | | | | 166 | | | | — | | | | — | | | | — | |
| |
| | | |
| Notes: | | Applicable ratios are annualized |
| |
| |
| *-Noninterest expense divided by the sum of taxable equivalent net interest income plus noninterest income less gain (loss) on sale of securities. |
12
| | |
First Charter Corporation and Subsidiaries
Quarterly Earnings Release | | (NASDAQ: FCTR) |
| | | | | | | | | | | | | | | | | | | | | |
| | | As of / For the Quarter Ended | |
| (Dollars in thousands, except per share data) | | 6/30/2005 | | | 3/31/2005 | | | 12/31/2004 | | | 9/30/2004 | | | 6/30/2004 | |
| |
ASSET QUALITY ANALYSIS | | | | | | | | | | | | | | | | | | | | |
Allowance for Loan Losses | | | | | | | | | | | | | | | | | | | | |
| Beginning balance | | $ | 27,483 | | | $ | 26,872 | | | $ | 26,859 | | | $ | 26,052 | | | $ | 25,736 | |
| Provision for loan losses | | | 2,878 | | | | 1,900 | | | | 1,825 | | | | 1,600 | | | | 2,000 | |
| Allowance related to loans sold | | | — | | | | — | | | | — | | | | (35 | ) | | | — | |
| Charge-offs | | | (1,516 | ) | | | (1,918 | ) | | | (2,063 | ) | | | (1,432 | ) | | | (2,475 | ) |
| Recoveries | | | 187 | | | | 629 | | | | 251 | | | | 674 | | | | 791 | |
| | | |
| Net charge-offs | | | (1,329 | ) | | | (1,289 | ) | | | (1,812 | ) | | | (758 | ) | | | (1,684 | ) |
| | | |
| Ending balance | | $ | 29,032 | | | $ | 27,483 | | | $ | 26,872 | | | $ | 26,859 | | | $ | 26,052 | |
| | | |
Nonperforming Assets and Loans 90 days or more past due accruing interest | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans | | $ | 9,858 | | | $ | 9,282 | | | $ | 13,970 | | | $ | 14,237 | | | $ | 12,533 | |
| Other real estate | | | 6,390 | | | | 7,648 | | | | 3,844 | | | | 4,962 | | | | 6,159 | |
| | | |
| Total nonperforming assets | | | 16,248 | | | | 16,930 | | | | 17,814 | | | | 19,199 | | | | 18,692 | |
| | | |
| Loans 90 days or more past due accruing interest | | | — | | | | — | | | | — | | | | 56 | | | | — | |
| | | |
Total | | $ | 16,248 | | | $ | 16,930 | | | $ | 17,814 | | | $ | 19,255 | | | $ | 18,692 | |
| | | |
Asset Quality Ratios (*) | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans as a percentage of total loans | | | 0.34 | % | | | 0.34 | % | | | 0.57 | % | | | 0.59 | % | | | 0.53 | % |
| Nonperforming assets as a percentage of total assets | | | 0.35 | | | | 0.38 | | | | 0.40 | | | | 0.44 | | | | 0.43 | |
| Nonperforming assets as a percentage of total loans and other real estate | | | 0.57 | | | | 0.62 | | | | 0.73 | | | | 0.79 | | | | 0.79 | |
| Net charge-offs as a percentage of average loans (annualized) | | | 0.19 | | | | 0.21 | | | | 0.30 | | | | 0.13 | | | | 0.29 | |
| Allowance for loan losses as a percentage of loans | | | 1.02 | | | | 1.02 | | | | 1.10 | | | | 1.11 | | | | 1.11 | |
| Ratio of allowance for loan losses to: | | | | | | | | | | | | | | | | | | | | |
| Net charge-offs (annualized) | | | 5.45 | x | | | 5.26 | x | | | 3.73 | x | | | 8.91 | x | | | 3.86 | x |
| Nonaccrual loans | | | 2.95 | | | | 2.96 | | | | 1.92 | | | | 1.89 | | | | 2.08 | |
| |
| | | | | | | | | | | | | | | | | |
| | | As of / For the Six Months Ended | | | Increase (Decrease) | |
| | | 6/30/2005 | | | 6/30/2004 | | | Amount | | | Percentage | |
| |
Allowance for Loan Losses | | | | | | | | | | | | | | | | |
| Beginning balance | | $ | 26,872 | | | $ | 25,607 | | | $ | 1,265 | | | | 4.9 | % |
| Provision for loan losses | | | 4,778 | | | | 5,000 | | | | (222 | ) | | | (4.4 | ) |
| Allowance related to loans sold | | | — | | | | (549 | ) | | | 549 | | | | (100.0 | ) |
| Charge-offs | | | (3,434 | ) | | | (5,054 | ) | | | (1,620 | ) | | | (32.1 | ) |
| Recoveries | | | 816 | | | | 1,048 | | | | (232 | ) | | | (22.1 | ) |
| | | |
| Net charge-offs | | | (2,618 | ) | | | (4,006 | ) | | | (1,388 | ) | | | (34.6 | ) |
| | | |
| Ending balance | | $ | 29,032 | | | $ | 26,052 | | | $ | 2,980 | | | | 11.4 | % |
| | | |
Asset Quality Ratios (*) | | | | | | | | | | | | | | | | |
| Net charge-offs as a percentage of average loans | | | 0.20 | % | | | 0.35 | % | | | | | | | | |
| Ratio of allowance for loan losses to net charge-offs | | | 5.50 | x | | | 3.24 | x | | | | | | | | |
| |
| | | | | | | | | | | | | | | | | | | | | |
| | | For the Quarter Ended | |
| | | 6/30/2005 | | | 3/31/2005 | | | 12/31/2004 | | | 9/30/2004 | | | 6/30/2004 | |
| |
ANNUALIZED INTEREST YIELDS / RATES (**) | | | | | | | | | | | | | | | | | | | | |
Interest income: | | | | | | | | | | | | | | | | | | | | |
| Yield on loans and loans held for sale | | | 6.04 | % | | | 5.80 | % | | | 5.60 | % | | | 5.22 | % | | | 5.05 | % |
| | | |
| Yield on securities | | | 3.92 | | | | 3.92 | | | | 3.94 | | | | 3.97 | | | | 3.92 | |
| | | |
| Yield on interest earning assets | | | 5.32 | | | | 5.08 | | | | 4.92 | | | | 4.70 | | | | 4.57 | |
| | | |
Interest expense: | | | | | | | | | | | | | | | | | | | | |
| Cost of interest bearing deposits | | | 2.13 | | | | 1.89 | | | | 1.73 | | | | 1.60 | | | | 1.59 | |
| Cost of borrowings | | | 3.21 | | | | 2.82 | | | | 2.37 | | | | 2.08 | | | | 1.77 | |
| | | |
| Cost of interest bearing liabilities | | | 2.55 | | | | 2.25 | | | | 1.98 | | | | 1.79 | | | | 1.66 | |
| | | |
| Interest rate spread | | | 2.77 | | | | 2.83 | | | | 2.94 | | | | 2.91 | | | | 2.91 | |
| | | |
| Net yield on earning assets | | | 3.03 | % | | | 3.06 | % | | | 3.15 | % | | | 3.10 | % | | | 3.07 | % |
| | | |
| |
| | | |
| Notes: | | Applicable ratios are annualized. |
| |
| |
| (*)-Excludes loans held for sale. |
| |
| (**)-Fully taxable equivalent yields. The calculation of the yield on securities for 2004 has been adjusted to reflect a correction in the taxable equivalent adjustment. |
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