Exhibit 99.1
Independent Bank Corp. Reports Second Quarter Net Income of $8.0 Million
Solid Commercial Loan and Core Deposit Growth Drive Performance
Significant Reduction in Nonperforming Assets
ROCKLAND, Mass.--(BUSINESS WIRE)--July 22, 2010--Independent Bank Corp., (NASDAQ: INDB), parent of Rockland Trust Company, today announced net income of $8.0 million for the second quarter of 2010 compared to $9.2 million recorded in the first quarter of 2010. On a diluted earnings per share basis, the Company reported earnings of $0.38 for the quarter as compared to $0.44 for the previous quarter.
Christopher Oddleifson, President and Chief Executive Officer, stated, “Our second quarter performance was solid, fueled in large part by growth in priority loan portfolios, including commercial and industrial and home equity, as well as very strong core deposit growth. These are major areas of focus for Rockland Trust as they help build long-term customer relationships. While the timing of charge-offs caused higher loss provisioning in the period, we significantly reduced our nonperforming assets this quarter. The Rockland Trust franchise is in excellent shape and we are well positioned for continued growth.”
BALANCE SHEET
Total assets increased by $193.8 million, or 4.3%, to $4.7 billion at June 30, 2010 as compared to March 31, 2010.
Total loans were $3.4 billion at June 30, 2010, an increase of $17.1 million, from the prior quarter. The Company continued to generate solid growth in the commercial and industrial portfolio which increased by 10.2% in the second quarter, mainly due to taking advantage of opportunities brought about by market disruption. The Company has a strong pipeline in the commercial real estate category but overall outstanding loans were flat due to loan payoffs and targeted exposure reduction. The home equity portfolio continued to grow, rising 3.0% in the second quarter. Residential real estate loans continued to decline modestly as individual loans refinance into longer term, fixed rate loans, which are not commonly held in portfolio by the Company.
Total deposits increased by $206.0 million, or 5.9%, during the quarter ending June 30, 2010, as a result of strong growth in commercial deposits and management’s strategy to grow the municipal banking business which is meeting with much success. Time deposits decreased by $38.8 million due to the Company’s strategy to focus on lower-cost core deposits, which grew by $244.8 million, or 9.4%, in the second quarter and have now risen to 77.6% of total deposits at June 30, 2010. Total cost of deposits declined to 0.62% for the current quarter, down 10 basis points from the prior quarter.
Securities are up $21.6 million to $593.6 from the prior quarter. The Company purchased $66.7 million of securities, primarily floating rate agency mortgage-backed securities, offset by the sale of $19.8 million in fixed rate securities during the quarter.
Stockholders’ equity at June 30, 2010 totaled $422.1 million as compared to $418.2 million at March 31, 2010. The Tier 1 leverage capital ratio at June 30, 2010 was 7.8%, maintaining the Company’s well-capitalized position.
NET INTEREST INCOME
The net interest margin in the second quarter of 2010 declined to 3.96%, compared to the linked quarter period of 4.08%. The lower margin was attributable to the reinvestment of excess cash into highly-liquid short term earning assets during the quarter. The Company’s cash position is a direct result of the sharp increase in deposits and provides added flexibility to fund future loan growth.
NON-INTEREST INCOME
The Company recorded non-interest income of $10.9 million during the second quarter of 2010 which represents a slight increase from the prior quarter. The change in non-interest income is composed of the following:
- Service charges on deposit accounts increased by $294,000, or 7.0%.
- Wealth management revenue increased by $461,000, mainly due to increases in seasonal revenue associated with tax preparation and estate fees. Assets under management in the wealth management division were $1.3 billion at June 30, 2010.
- Mortgage banking income decreased by $378,000, largely due to increased amortization of the mortgage servicing asset and changes in the fair value of rate locked pipeline loans and forward sales commitments. The balance of the mortgage servicing asset was $2.1 million and represented 67 basis points of the servicing portfolio.
- The Company recorded a gain on the sale of fixed rate securities of $481,000.
- Other non-interest income decreased by $74,000 or 4.8%.
NON-INTEREST EXPENSE
The Company recorded non-interest expense of $34.9 million in the second quarter of 2010, an increase of $1.3 million, or 4.0%, when compared to the quarter ended March 31, 2010. Significant changes of non-interest expense include the following:
- The change in fair value of an interest rate swap that was previously hedging borrowings decreased by $315,000, as compared to the prior quarter. The Company terminated the interest rate swap during the second quarter as a result of management’s decision to pay down the underlying borrowings.
- Other non-interest expense increased by $1.3 million, or 15.4%, which is primarily attributable to the timing of advertising expenses of $348,000, shareholder relations expense of $151,000, and exam and audit fees of $108,000, as well as increases in legal fees of $249,000 associated with loan work-outs, and consultant fees of $169,000.
The Company reported a return on average assets and a return on average common equity in the second quarter of 2010 of 0.70% and 7.60%, respectively, as compared to 0.84% and 8.95% for the quarter ended March 31, 2010.
ASSET QUALITY
The allowance for loan losses was maintained at $45.3 million at June 30, 2010 consistent with the prior quarter. Nonperforming loans decreased significantly to $23.7 million or 0.69% of total loans at June 30, 2010, from $41.8 million, or 1.23% of total loans at March 31, 2010. As a result, the allowance for loan losses as a percentage of nonperforming loans improved from 108.22% in the prior quarter to 191.28% in the second quarter. Delinquency levels have also shown significant improvement with delinquencies as a percent of loans at 1.32% at June 30, 2010 compared to 1.82% at March 31, 2010. The Company’s allowance for loan losses as a percentage of total loans remains consistent at 1.32%.
Net charge-offs increased to $6.9 million, or 0.81% on an annualized basis of average loans for the second quarter compared to $1.7 million or 0.21% for the quarter ending March 31, 2010. Second quarter net charge-offs included a write down taken on the sale of a nonperforming loan subsequent to the end of the quarter. The provision for loan losses was $6.9 million and $4.7 million for the quarters ended June 30, 2010 and March 31, 2010, respectively, an increase of $2.2 million.
Christopher Oddleifson and Denis K. Sheahan, Chief Financial Officer, of Independent Bank Corp. and Rockland Trust Company, will host a conference call to discuss second quarter earnings at 10:00 a.m. Eastern Time on Friday, July 23, 2010. Internet access to the call is available on the Company’s website at www.RocklandTrust.com or by telephonic access by dial-in at 1-877-317-6789 reference: INDB. A replay of the call will be available by calling 1-877-344-7529, Replay Pass code: 442401. The web cast replay will be available until August 9, 2010.
Independent Bank Corp., which has Rockland Trust Company as a wholly-owned bank subsidiary, has $4.7 billion in assets. Rockland Trust offers a wide range of commercial banking products and services, retail banking products and services, business and consumer loans, insurance products and services, and investment management services. To find out why Rockland Trust is the bank Where Each Relationship Matters®, visit www.RocklandTrust.com.
This press release contains certain “forward-looking statements” with respect to the financial condition, results of operations and business of the Company. Actual results may differ from those contemplated by these statements. The Company wishes to caution readers not to place undue reliance on any forward-looking statements. The Company disclaims any intent or obligation to update publicly any such forward-looking statements, whether in response to new information, future events or otherwise.
This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Operating earnings, which is a non-GAAP financial measure, excludes gain or loss due to items that management does not believe are related to its core banking business, such as gains or losses on the sales of securities, merger and acquisition expenses, and other items. The Company’s management uses operating earnings to measure the strength of the Company’s core banking business and to identify trends that may to some extent be obscured by gains or losses which management deems not to be core to the Company’s operations. The Company has included information on operating earnings because management believes that investors may find it useful to have access to the same analytical tool used by management and may also find that it facilitates the comparison of the Company to other companies in the financial services industry. Non-GAAP operating earnings should not be viewed as a substitute for operating results determined in accordance with GAAP. An item which management deems to be non-core and excludes when computing non-GAAP operating earnings can be of substantial importance to the Company’s results for any particular quarter or year. The Company’s non-GAAP operating earnings are not necessarily comparable to non-GAAP performance measures which may be presented by other companies.
INDEPENDENT BANK CORP. FINANCIAL SUMMARY | | | | | | | | | | |
| (Unaudited - Dollars in Thousands) | | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | % Change | | % Change |
| CONSOLIDATED BALANCE SHEETS | | June 30, | | March 31, | | June 30, | | June 2010 vs. | | June 2010 vs. |
| | | 2010 | | 2010 | | 2009 | | Mar 2010 | | June 2009 |
| | | | | | | | | | |
| Assets | | | | | | | | | | |
| Cash and Due From Banks | | $ | 69,246 | | | $ | 60,846 | | | $ | 74,767 | | | 13.81 | % | | -7.38 | % |
| Interest Earning Deposits with Banks | | | 268,162 | | | | 158,209 | | | | 1,138 | | | 69.50 | % | | 23464.32 | % |
| Fed Funds Sold and Short Term Investments | | | 781 | | | | - | | | | 6,159 | | | n/a | | | -87.32 | % |
| Securities | | | | | | | | | | |
| Trading Assets | | | 7,163 | | | | 7,399 | | | | 22,926 | | | -3.19 | % | | -68.76 | % |
| Securities Available for Sale | | | 482,989 | | | | 473,515 | | | | 581,241 | | | 2.00 | % | | -16.90 | % |
| Securities Held to Maturity | | | 103,463 | | | | 91,059 | | | | 70,241 | | | 13.62 | % | | 47.30 | % |
| Total Securities | | | 593,615 | | | | 571,973 | | | | 674,408 | | | 3.78 | % | | -11.98 | % |
| | | | | | | | | | |
| Loans Held for Sale | | | 16,365 | | | | 7,570 | | | | 24,866 | | | 116.18 | % | | -34.19 | % |
| Loans | | | | | | | | | | |
| Commercial and Industrial | | | 427,398 | | | | 387,785 | | | | 364,570 | | | 10.22 | % | | 17.23 | % |
| Commercial Real Estate | | | 1,646,204 | | | | 1,645,251 | | | | 1,482,321 | | | 0.06 | % | | 11.06 | % |
| Commercial Construction | | | 158,036 | | | | 167,161 | | | | 206,569 | | | -5.46 | % | | -23.49 | % |
| Small Business | | | 80,965 | | | | 81,696 | | | | 86,378 | | | -0.89 | % | | -6.27 | % |
| Total Commercial | | | 2,312,603 | | | | 2,281,893 | | | | 2,139,838 | | | 1.35 | % | | 8.07 | % |
| Residential Real Estate | | | 525,062 | | | | 539,709 | | | | 599,166 | | | -2.71 | % | | -12.37 | % |
| Residential Construction | | | 4,594 | | | | 7,732 | | | | 15,323 | | | -40.58 | % | | -70.02 | % |
| Consumer - Home Equity | | | 498,789 | | | | 484,413 | | | | 458,435 | | | 2.97 | % | | 8.80 | % |
| Total Consumer Real Estate | | | 1,028,445 | | | | 1,031,854 | | | | 1,072,924 | | | -0.33 | % | | -4.15 | % |
| Consumer - Auto | | | 58,294 | | | | 67,807 | | | | 105,064 | | | -14.03 | % | | -44.52 | % |
| Consumer - Other | | | 29,570 | | | | 30,238 | | | | 35,314 | | | -2.21 | % | | -16.27 | % |
| Total Other Consumer | | | 87,864 | | | | 98,045 | | | | 140,378 | | | -10.38 | % | | -37.41 | % |
| Total Loans | | | 3,428,912 | | | | 3,411,792 | | | | 3,353,140 | | | 0.50 | % | | 2.26 | % |
| Less - Allowance for Loan Losses | | | (45,291 | ) | | | (45,278 | ) | | | (40,068 | ) | | 0.03 | % | | 13.04 | % |
| Net Loans | | | 3,383,621 | | | | 3,366,514 | | | | 3,313,072 | | | 0.51 | % | | 2.13 | % |
| Federal Home Loan Bank Stock | | | 35,854 | | | | 35,854 | | | | 36,357 | | | 0.00 | % | | -1.38 | % |
| Bank Premises and Equipment | | | 45,089 | | | | 44,850 | | | | 42,145 | | | 0.53 | % | | 6.99 | % |
| Goodwill and Core Deposit Intangible | | | 142,888 | | | | 143,371 | | | | 144,865 | | | -0.34 | % | | -1.36 | % |
| Other Assets | | | 185,354 | | | | 158,020 | | | | 137,282 | | | 17.30 | % | | 35.02 | % |
| Total Assets | | $ | 4,740,975 | | | $ | 4,547,207 | | | $ | 4,455,059 | | | 4.26 | % | | 6.42 | % |
| | | | | | | | | | |
| Liabilities and Stockholders' Equity | | | | | | | | | | |
| Deposits | | | | | | | | | | |
| Demand Deposits | | $ | 789,019 | | | $ | 720,246 | | | $ | 699,173 | | | 9.55 | % | | 12.85 | % |
| Savings and Interest Checking Accounts | | | 1,305,515 | | | | 1,170,194 | | | | 987,202 | | | 11.56 | % | | 32.24 | % |
| Money Market | | | 760,471 | | | | 719,761 | | | | 667,665 | | | 5.66 | % | | 13.90 | % |
| Time Certificates of Deposit | | | 824,868 | | | | 863,652 | | | | 970,903 | | | -4.49 | % | | -15.04 | % |
| Total Deposits | | | 3,679,873 | | | | 3,473,853 | | | | 3,324,943 | | | 5.93 | % | | 10.67 | % |
| Borrowings | | | | | | | | | | |
| Federal Home Loan Bank Borrowings | | | 302,677 | | | | 327,807 | | | | 392,968 | | | -7.67 | % | | -22.98 | % |
| Fed Funds Purchased and Assets Sold | | | | | | | | | | |
| Under Repurchase Agreements | | | 178,476 | | | | 184,436 | | | | 179,317 | | | -3.23 | % | | -0.47 | % |
| Junior Subordinated Debentures | | | 61,857 | | | | 61,857 | | | | 61,857 | | | 0.00 | % | | 0.00 | % |
| Subordinated Debentures | | | 30,000 | | | | 30,000 | | | | 30,000 | | | 0.00 | % | | 0.00 | % |
| Other Borrowings | | | 3,136 | | | | 2,873 | | | | 3,772 | | | 9.15 | % | | -16.86 | % |
| Total Borrowings | | | 576,146 | | | | 606,973 | | | | 667,914 | | | -5.08 | % | | -13.74 | % |
| Total Deposits and Borrowings | | | 4,256,019 | | | | 4,080,826 | | | | 3,992,857 | | | 4.29 | % | | 6.59 | % |
| Other Liabilities | | | 62,894 | | | | 48,157 | | | | 64,642 | | | 30.60 | % | | -2.70 | % |
| Stockholders' Equity | | | | | | | | | | |
| Common Stock | | | 210 | | | | 209 | | | | 209 | | | 0.48 | % | | 0.48 | % |
| Additional Paid in Capital | | | 225,792 | | | | 225,373 | | | | 224,594 | | | 0.19 | % | | 0.53 | % |
| Retained Earnings | | | 194,587 | | | | 190,064 | | | | 176,012 | | | 2.38 | % | | 10.55 | % |
| Accumulated Other Comprehensive Income/(Loss), Net of Tax | | | 1,473 | | | | 2,578 | | | | (3,255 | ) | | -42.86 | % | | -145.25 | % |
| Total Stockholders' Equity | | | 422,062 | | | | 418,224 | | | | 397,560 | | | 0.92 | % | | 6.16 | % |
| Total Liabilities and Stockholders' Equity | | $ | 4,740,975 | | | $ | 4,547,207 | | | $ | 4,455,059 | | | 4.26 | % | | 6.42 | % |
INDEPENDENT BANK CORP. FINANCIAL SUMMARY | | | | | | | | | | |
| (Unaudited - Dollars in Thousands, Except Per Share Data) | | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| CONSOLIDATED STATEMENTS OF INCOME | | Three Months Ended |
| | | | | | | | % Change | | % Change |
| | June 30, | | March 31, | | June 30, | | June 2010 vs. | | June 2010 vs. |
| | | 2010 | | | | 2010 | | | | 2009 | | | Mar 2010 | | June 2009 |
| | | | | | | | | | |
| INTEREST INCOME | | | | | | | | | | |
| Interest on Fed Funds Sold and Short Term Investments | | $ | 108 | | | $ | 24 | | | $ | 70 | | | 350.00 | % | | 54.29 | % |
| Interest and Dividends on Securities | | | 6,316 | | | | 6,671 | | | | 7,636 | | | -5.32 | % | | -17.29 | % |
| Interest on Loans | | | 44,785 | | | | 44,047 | | | | 44,938 | | | 1.68 | % | | -0.34 | % |
| Interest on Loans Held for Sale | | | 110 | | | | 106 | | | | 162 | | | 3.77 | % | | -32.10 | % |
| Total Interest Income | | | 51,319 | | | | 50,848 | | | | 52,806 | | | 0.93 | % | | -2.82 | % |
| INTEREST EXPENSE | | | | | | | | | | |
| Interest on Deposits | | | 5,485 | | | | 5,939 | | | | 8,441 | | | -7.64 | % | | -35.02 | % |
| Interest on Borrowed Funds | | | 4,667 | | | | 4,699 | | | | 5,265 | | | -0.68 | % | | -11.36 | % |
| Total Interest Expense | | | 10,152 | | | | 10,638 | | | | 13,706 | | | -4.57 | % | | -25.93 | % |
| Net Interest Income | | | 41,167 | | | | 40,210 | | | | 39,100 | | | 2.38 | % | | 5.29 | % |
| Less - Provision for Loan Losses | | | 6,931 | | | | 4,650 | | | | 4,468 | | | 49.05 | % | | 55.13 | % |
| Net Interest Income after Provision for Loan Losses | | | 34,236 | | | | 35,560 | | | | 34,632 | | | -3.72 | % | | -1.14 | % |
| NON-INTEREST INCOME | | | | | | | | | | |
| Service Charges on Deposit Accounts | | | 4,515 | | | | 4,221 | | | | 4,258 | | | 6.97 | % | | 6.04 | % |
| Wealth Management | | | 3,189 | | | | 2,728 | | | | 2,710 | | | 16.90 | % | | 17.68 | % |
| Mortgage Banking Income | | | 622 | | | | 1,000 | | | | 1,996 | | | -37.80 | % | | -68.84 | % |
| BOLI Income | | | 731 | | | | 721 | | | | 683 | | | 1.39 | % | | 7.03 | % |
| Net Gain/(Loss) on Sale of Securities | | | 481 | | | | - | | | | (25 | ) | | n/a | | | -2024.00 | % |
| Gain Resulting From Early Termination of Hedging Relationship | | | - | | | | - | | | | 3,778 | | | | | -100.00 | % |
Gross Change on Write-Down of Certain Investments to Fair Value | | | (63 | ) | | | 180 | | | | (2,174 | ) | | -135.00 | % | | n/a | |
| Less: Non-Credit Related Other-Than-Temporary Impairment | | | (21 | ) | | | (358 | ) | | | 521 | | | -94.13 | % | | n/a | |
| Net Loss on Write-Down of Certain Investments to Fair Value | | | (84 | ) | | | (178 | ) | | | (1,653 | ) | | -52.81 | % | | n/a | |
| Other Non-Interest /Income | | | 1,484 | | | | 1,558 | | | | 1,476 | | | -4.75 | % | | 0.54 | % |
| Total Non-Interest Income | | | 10,938 | | | | 10,050 | | | | 13,223 | | | 8.84 | % | | -17.28 | % |
| NON-INTEREST EXPENSE | | | | | | | | | | |
| Salaries and Employee Benefits | | | 18,406 | | | | 18,464 | | | | 17,134 | | | -0.31 | % | | 7.42 | % |
| Occupancy and Equipment Expenses | | | 4,094 | | | | 4,135 | | | | 4,136 | | | -0.99 | % | | -1.02 | % |
| Data Processing and Facilities Management | | | 1,497 | | | | 1,294 | | | | 1,604 | | | 15.69 | % | | -6.67 | % |
| Merger & Acquisition Expense | | | - | | | | - | | | | 10,844 | | | n/a | | | n/a | |
| FDIC Assessment | | | 1,271 | | | | 1,321 | | | | 3,852 | | | -3.79 | % | | -67.00 | % |
| Other Non-Interest Expense | | | 9,661 | | | | 8,374 | | | | 8,986 | | | 15.37 | % | | 7.51 | % |
| Total Non-Interest Expense | | | 34,929 | | | | 33,588 | | | | 46,556 | | | 3.99 | % | | -24.97 | % |
| INCOME BEFORE INCOME TAXES | | | 10,245 | | | | 12,022 | | | | 1,299 | | | -14.78 | % | | 688.68 | % |
| PROVISION FOR INCOME TAXES | | | 2,215 | | | | 2,795 | | | | 639 | | | -20.75 | % | | 246.64 | % |
| NET INCOME | | $ | 8,030 | | | $ | 9,227 | | | $ | 660 | | | -12.97 | % | | 1116.67 | % |
| | | | | | | | | | |
| PREFERRED STOCK DIVIDEND | | $ | - | | | $ | - | | | $ | 4,525 | | | | | |
| | | | | | | | | | |
| NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | | $ | 8,030 | | | $ | 9,227 | | | $ | (3,865 | ) | | -12.97 | % | | -307.76 | % |
| | | | | | | | | | |
| BASIC EARNINGS PER SHARE | | $ | 0.38 | | | $ | 0.44 | | | $ | (0.19 | ) | | -13.64 | % | | -300.00 | % |
| DILUTED EARNINGS PER SHARE | | $ | 0.38 | | | $ | 0.44 | | | $ | (0.19 | ) | | -13.64 | % | | -300.00 | % |
| BASIC AVERAGE SHARES | | | 20,964,706 | | | | 20,937,589 | | | | 20,360,046 | | | | | |
| DILUTED AVERAGE SHARES | | | 21,055,645 | | | | 21,008,422 | | | | 20,385,609 | | | | | |
| | | | | | | | | | |
PERFORMANCE RATIOS: | | | | | | | | | | |
| Net Interest Margin (FTE) | | | 3.96 | % | | | 4.08 | % | | | 3.89 | % | | | | |
| Return on Average Assets | | | 0.70 | % | | | 0.84 | % | | | -0.35 | % | | | | |
| Return on Average Common Equity | | | 7.60 | % | | | 8.95 | % | | | -3.97 | % | | | | |
| | | | | | | | | | |
RECONCILIATION TABLE - NON-GAAP FINANCIAL INFORMATION | | | | | | | | |
| NET INCOME AVAILABLE TO COMMON SHAREHOLDERS (GAAP) | | $ | 8,030 | | | $ | 9,227 | | | $ | (3,865 | ) | | -12.97 | % | | -307.76 | % |
| Non-Interest Income Components | | | | | | | | | | |
(Less)/Add - Net (Gain)/Loss on Sale of Securities, net of tax | | | (285 | ) | | | - | | | | 16 | | | | | |
| Less - Gain Resulting From early Termination of Hedging Relationship | | | - | | | | - | | | | (2,455 | ) | | | | |
| Non-Interest Expense Components | | | | | | | | | | |
| Add - Merger and Acquisition Expenses, net of tax | | | - | | | | - | | | | 8,676 | | | | | |
| Add - Fair Value Mark on a Terminated Hedging Relationship | | | 328 | | | | - | | | | - | | | | | |
| Deemed Preferred Stock Dividend | | | - | | | | - | | | | 4,384 | | | | | |
| NET OPERATING EARNINGS | | $ | 8,073 | | | $ | 9,227 | | | $ | 6,756 | | | -12.50 | % | | 19.49 | % |
| | | | | | | | | | |
| | | | | | | | | | |
| Diluted Earnings Per Share, on an Operating Basis | | $ | 0.38 | | | $ | 0.44 | | | $ | 0.33 | | | -13.64 | % | | 15.15 | % |
| CONSOLIDATED STATEMENTS OF INCOME | | | | | | |
| | Six Months | | % Change |
| | June 30, | | June 30, | | June 2010 vs. |
| | | 2010 | | | | 2009 | | | June 2009 |
| | | | | | |
| INTEREST INCOME | | | | | | |
| Interest on Fed Funds Sold and Short Term Investments | | $ | 132 | | | $ | 268 | | | -50.75 | % |
| Interest and Dividends on Securities | | | 12,987 | | | | 14,902 | | | -12.85 | % |
| Interest on Loans | | | 88,832 | | | | 80,718 | | | 10.05 | % |
| Interest on Loans Held for Sale | | | 216 | | | | 328 | | | -34.15 | % |
| Total Interest Income | | | 102,167 | | | | 96,216 | | | 6.19 | % |
| INTEREST EXPENSE | | | | | | |
| Interest on Deposits | | | 11,424 | | | | 16,848 | | | -32.19 | % |
| Interest on Borrowed Funds | | | 9,366 | | | | 10,280 | | | -8.89 | % |
| Total Interest Expense | | | 20,790 | | | | 27,128 | | | -23.36 | % |
| Net Interest Income | | | 81,377 | | | | 69,088 | | | 17.79 | % |
| Less - Provision for Loan Losses | | | 11,580 | | | | 8,468 | | | 36.75 | % |
| Net Interest Income after Provision for Loan Losses | | | 69,797 | | | | 60,620 | | | 15.14 | % |
| NON-INTEREST INCOME | | | | | | |
| Service Charges on Deposit Accounts | | | 8,736 | | | | 7,905 | | | 10.51 | % |
| Wealth Management | | | 5,918 | | | | 5,040 | | | 17.42 | % |
| Mortgage Banking Income | | | 1,622 | | | | 3,153 | | | -48.56 | % |
| BOLI Income | | | 1,452 | | | | 1,413 | | | 2.76 | % |
Net Gain on Sale of Securities | | | 481 | | | | 1,354 | | | -64.48 | % |
| Gain Resulting From early Termination of Hedging Relationship | | | - | | | | 3,778 | | | -100.00 | % |
Gross Change on Write-Down of Certain Investments to Fair Value | | | 118 | | | | (2,276 | ) | | -105.18 | % |
| Less: Non-Credit Related Other-Than-Temporary Impairment | | | (380 | ) | | | 623 | | | -161.00 | % |
| Net Loss on Write-Down of Certain Investments to Fair Value | | | (262 | ) | | | (1,653 | ) | | -84.15 | % |
Other Non-Interest Income | | | 3,041 | | | | 2,707 | | | 12.34 | % |
| Total Non-Interest Income | | | 20,988 | | | | 23,697 | | | -11.43 | % |
| NON-INTEREST EXPENSE | | | | | | |
| Salaries and Employee Benefits | | | 36,869 | | | | 31,993 | | | 15.24 | % |
| Occupancy and Equipment Expenses | | | 8,229 | | | | 7,841 | | | 4.95 | % |
| Data Processing and Facilities Management | | | 2,791 | | | | 3,020 | | | -7.58 | % |
| Merger & Acquisition Expense | | | - | | | | 12,382 | | | -100.00 | % |
| FDIC assessment | | | 2,592 | | | | 4,388 | | | -40.93 | % |
| Other Non-Interest Expense | | | 18,037 | | | | 15,240 | | | 18.35 | % |
| Total Non-Interest Expense | | | 68,518 | | | | 74,864 | | | -8.48 | % |
| INCOME BEFORE INCOME TAXES | | | 22,267 | | | | 9,453 | | | 135.55 | % |
| PROVISION FOR INCOME TAXES | | | 5,010 | | | | 2,406 | | | 108.23 | % |
| NET INCOME | | $ | 17,257 | | | $ | 7,047 | | | 144.88 | % |
| | | | | | |
| PREFERRED STOCK DIVIDEND | | $ | - | | | $ | 5,698 | | | - | |
| | | | | | |
| NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | | $ | 17,257 | | | $ | 1,349 | | | 1179.24 | % |
| | | | | | |
| BASIC EARNINGS PER SHARE | | $ | 0.82 | | | $ | 0.07 | | | 1071.43 | % |
| DILUTED EARNINGS PER SHARE | | $ | 0.82 | | | $ | 0.07 | | | 1071.43 | % |
| BASIC AVERAGE SHARES | | | 20,951,264 | | | | 18,345,457 | | | |
| DILUTED AVERAGE SHARES | | | 21,034,553 | | | | 18,366,798 | | | |
| | | | | | |
PERFORMANCE RATIOS: | | | | | | |
| Net Interest Margin (FTE) | | | 4.02 | % | | | 3.77 | % | | |
| Return on Average Assets | | | 0.77 | % | | | 0.07 | % | | |
| Return on Average Common Equity | | | 8.26 | % | | | 0.69 | % | | |
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RECONCILIATION TABLE - NON-GAAP FINANCIAL INFORMATION | | | | |
| NET INCOME AVAILABLE TO COMMON SHAREHOLDERS (GAAP) | | $ | 17,257 | | | $ | 1,349 | | | 1179.24 | % |
| Non-Interest Income Components | | | | | | |
Less - Net Gain on Sale of Securities, net of tax | | | (285 | ) | | | (880 | ) | | |
| Less - Gain Resulting From early Termination of Hedging Relationship | | | - | | | | (2,455 | ) | | |
| Non-Interest Expense Components | | | | | | |
| Add - Merger and Acquisition Expenses, net of tax | | | - | | | | 9,675 | | | |
| Add - Fair Value Mark on a Terminated Hedging Relationship | | | 328 | | | | - | | | |
| Deemed Preferred Stock Dividend | | | - | | | | 4,384 | | | |
| NET OPERATING EARNINGS | | $ | 17,300 | | | $ | 12,073 | | | 43.30 | % |
| | | | | | |
| | | | | | |
| Diluted Earnings Per Share, on an Operating Basis | | $ | 0.82 | | | $ | 0.66 | | | 24.24 | % |
INDEPENDENT BANK CORP. FINANCIAL SUMMARY |
| (Unaudited - Dollars in Thousands, Except Per Share Data) | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| RECONCILIATION TABLE - NON-GAAP FINANCIAL INFORMATION | | | | | | | | | | | | | | |
| | Three Months Ended | | Six Months Ended |
| | | | | | | | % Change | | % Change | | | | | | % Change |
| | June 30, | | March 31, | | June 30, | | June 2010 vs. | | June 2010 vs. | | June 30, | | June 30, | | June 2010 vs. |
| | 2010 | | 2010 | | 2009 | | Mar 2010 | | June 2009 | | 2010 | | 2009 | | June 2009 |
| | | | | | | | | | | | | | | | |
| Non-Interest Income GAAP | | $ | 10,938 | | | $ | 10,050 | | | $ | 13,223 | | | | 8.84 | % | | | -17.28 | % | | $ | 20,988 | | | $ | 23,697 | | | | -11.43 | % |
| Add/(less) - Net Loss/(Gain) on Sale of Securities | | | (481 | ) | | | - | | | | 25 | | | | n/a | | | | n/a | | | | (481 | ) | | | (1,354 | ) | | | -64.48 | % |
| Less - Gain Resulting From Early Termination of Hedging Relationship | | | - | | | | - | | | | (3,778 | ) | | | n/a | | | | -100.00 | % | | | - | | | | (3,778 | ) | | | -100.00 | % |
| Add - Other-Than-Temporary-Impairment on Securities | | | 84 | | | | 178 | | | | 1,653 | | | | -52.81 | % | | | n/a | | | | 262 | | | | 1,653 | | | | -84.15 | % |
| Non-Interest Income as Adjusted | | $ | 10,541 | | | $ | 10,228 | | | $ | 11,123 | | | | 3.06 | % | | | -5.23 | % | | $ | 20,769 | | | $ | 20,218 | | | | 2.73 | % |
| | | | | | | | | | | | | | | | |
| Non-Interest Expense GAAP | | $ | 34,929 | | | $ | 33,588 | | | $ | 46,556 | | | | 3.99 | % | | | -24.97 | % | | $ | 68,518 | | | $ | 74,864 | | | | -8.48 | % |
| Less - Merger & Acquisition Expenses | | | - | | | | - | | | | (10,844 | ) | | | n/a | | | | -100.00 | % | | | - | | | | (12,382 | ) | | | -100.00 | % |
| Less - Fair Value Mark on a Terminated Hedging Relationship | | | (554 | ) | | | - | | | | - | | | | 100.00 | % | | | n/a | | | | (554 | ) | | | - | | | | 100.00 | % |
| Non-Interest Expense as Adjusted | | $ | 34,375 | | | $ | 33,588 | | | $ | 35,712 | | | | 2.34 | % | | | -3.74 | % | | $ | 67,964 | | | $ | 62,482 | | | | 8.77 | % |
| | | | | | | | | | | | | | | | |
| Certain non-core items are included in the computation of earnings in accordance with United States of America generally accepted accounting principles (“GAAP”) in both 2010 and 2009 as indicated by the table below. In an effort to provide investors with information regarding the Company's results, the Company has disclosed the following non-GAAP information, which management believes provides useful information to the investor. This information should not be viewed as a substitute for operating results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP information which may be presented by other companies. |
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ASSET QUALITY | | Nonperforming Assets | | Net Charge-Offs | | Net Charge-Offs |
| | For the Period Ending | | For the Three Months Ending | | For the Six Months Ending |
| | June 30, | | March 31, | | June 30, | | June 30, | | March 31, | | June 30, | | June 30, | | June 30, |
| | 2010 | | 2010 | | 2009 | | 2010 | | 2010 | | 2009 | | 2010 | | 2009 |
| | | | | | | | | | | | | | | | |
| | (Dollars in Thousands, Except Per Share Data) | | (Dollars in Thousands, Except Per Share Data) | | (Dollars in Thousands, Except Per Share Data) |
| Nonperforming Loans | | | | | | | | | | | | | | | | |
| Commercial & Industrial Loans | | $ | 5,083 | | | $ | 7,252 | | | $ | 4,808 | | | $ | 1,816 | | | $ | 527 | | | $ | 26 | | | $ | 2,343 | | | $ | 43 | |
| Small Business Loans | | | 728 | | | | 1,294 | | | | 1,743 | | | | 801 | | | | 251 | | | | 475 | | | | 1,052 | | | | 755 | |
| Commercial Real Estate Loans | | | 8,007 | | | | 23,645 | | | | 12,505 | | | | 3,520 | | | | 198 | | | | 71 | | | | 3,718 | | | | 2,130 | |
| Residential Real Estate Loans | | | 8,012 | | | | 8,092 | | | | 9,865 | | | | 293 | | | | 135 | | | | 206 | | | | 428 | | | | 196 | |
| Installment Loans - Home Equity | | | 1,218 | | | | 948 | | | | 1,695 | | | | 234 | | | | 234 | | | | 609 | | | | 468 | | | | 860 | |
| Installment Loans - Auto | | | 438 | | | | 438 | | | | 718 | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Installment Loans - Other | | | 192 | | | | 171 | | | | 157 | | | | 254 | | | | 388 | | | | 501 | | | | 642 | | | | 1,465 | |
| Total Nonperforming Loans / Total Net Charge-offs | | $ | 23,678 | | | $ | 41,840 | | | $ | 31,491 | | | $ | 6,918 | | | $ | 1,733 | | | $ | 1,888 | | | $ | 8,651 | | | $ | 5,449 | |
| Non-Accrual Securities | | | 969 | | | | 899 | | | | 3,120 | | | | | | | | | | | |
| Other Assets in Possession | | | 79 | | | | 98 | | | | 270 | | | | | | | | | | | |
| Other Real Estate Owned | | | 7,357 | | | | 5,990 | | | | 6,102 | | | | | | | | | | | |
| Nonperforming Assets | | $ | 32,083 | | | $ | 48,827 | | | $ | 40,983 | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| Nonperforming Loans/Gross Loans | | | 0.69 | % | | | 1.23 | % | | | 0.94 | % | | | | | | | | | | |
| Allowance for Loan Losses/Nonperforming Loans | | | 191.28 | % | | | 108.22 | % | | | 127.24 | % | | | | | | | | | | |
| Gross Loans/Total Deposits | | | 93.18 | % | | | 98.21 | % | | | 100.85 | % | | | | | | | | | | |
| Allowance for Loan Losses/Total Loans | | | 1.32 | % | | | 1.33 | % | | | 1.19 | % | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
Net charge-offs to average loans (quarter annualized) | | | | | | | | | 0.81 | % | | | 0.21 | % | | | 0.23 | % | | | | |
| Net charge-offs to average loans (year-to-date annualized) | | | | | | | | | | | | | | | 0.51 | % | | | 0.37 | % |
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| | QTD | | YTD | | | | | | | | | | | | |
| | June 30, | | June 30, | | | | | | | | | | | | |
Nonperforming Loans Reconciliation | | 2010 | | 2010 | | | | | | | | | | | | |
| Nonperforming Loans Beginning Balance | | $ | 41,840 | | | $ | 36,183 | | | | | | | | | | | | | |
| New to Nonperforming | | | 6,810 | | | | 23,416 | | | | | | | | | | | | | |
| Loans Charged-Off | | | (6,950 | ) | | | (8,847 | ) | | | | | | | | | | | | |
| Loans Paid-Off | | | (11,109 | ) | | | (13,946 | ) | | | | | | | | | | | | |
| Loans Transferred to Other Real Estate Owned/Other Assets | | | (4,849 | ) | | | (7,465 | ) | | | | | | | | | | | | |
| Loans Restored to Accrual Status | | | (2,064 | ) | | | (5,507 | ) | | | | | | | | | | | | |
| Other | | | - | | | | (156 | ) | | | | | | | | | | | | |
| Nonperforming Loans Ending Balance | | $ | 23,678 | | | $ | 23,678 | | | | | | | | | | | | | |
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| | | | | | | | | | | | | | | | |
| | June 30, | | March 31, | | June 30, | | | | | | | | | | |
Financial Ratios | | 2010 | | 2010 | | 2009 | | | | | | | | | | |
| Book Value per Common Share | | $ | 19.91 | | | $ | 19.76 | | | $ | 19.01 | | | | | | | | | | | |
Tangible Common Book Value per Share (proforma to include the tax deductibility of goodwill and exclude impact of CPP) - Non-GAAP | | $ | 14.14 | | | $ | 13.97 | | | $ | 13.11 | | | | | | | | | | | |
| Tangible Common Capital/Tangible Assets | | | 6.07 | % | | | 6.24 | % | | | 5.86 | % | | | | | | | | | | |
| Tangible Common Capital/Tangible Asset (proforma to include | | | | | | | | | | | | | | | | |
| the tax deductibility of goodwill and exclude impact of CPP) - Non-GAAP | | | 6.49 | % | | | 6.68 | % | | | 6.33 | % | | | | | | | | | | |
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| | | | | | | | | | | | | | | | |
| Capital Adequacy | | | | | | | | | | | | | | | | |
| Tier one leverage capital ratio (1) | | | 7.84 | % | | | 8.06 | % | | | 7.60 | % | | | | | | | | | | |
| INDEPENDENT BANK CORP. | | | | | | | | | | | | | | | | | | |
| SUPPLEMENTAL FINANCIAL INFORMATION | | | | | | | | | | | | | | | | | | |
| CONSOLIDATED AVERAGE BALANCE SHEETS AND AVERAGE RATE DATA | | Three Months Ended |
| (Unaudited - Dollars in Thousands) | | June 30, 2010 | | March 31, 2010 | | June 30, 2009 |
| | | | Interest | | | | | | Interest | | | | | | Interest | | |
| | | Average | | Earned/ | | Yield/ | | Average | | Earned/ | | Yield/ | | Average | | Earned/ | | Yield/ |
| | Balance | | Paid | | Rate | | Balance | | Paid | | Rate | | Balance | | Paid | | Rate |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| Interest-Earning Assets: | | | | | | | | | | | | | | | | | | |
| Interest Earning Deposits with Banks, Federal Funds Sold, and Short Term Investments | | $ | 188,976 | | $ | 108 | | 0.23 | % | | $ | 23,125 | | $ | 24 | | 0.42 | % | | $ | 86,883 | | $ | 70 | | 0.32 | % |
| Securities: | | | | | | | | | | | | | | | | | | |
| Trading Assets | | | 7,367 | | | 62 | | 3.38 | % | | | 6,800 | | | 60 | | 3.58 | % | | | 13,965 | | | 44 | | 1.26 | % |
| Taxable Investment Securities | | | 557,554 | | | 6,067 | | 4.36 | % | | | 568,550 | | | 6,409 | | 4.57 | % | | | 632,587 | | | 7,370 | | 4.67 | % |
| Non-taxable Investment Securities (1) | | | 17,718 | | | 316 | | 7.15 | % | | | 19,111 | | | 342 | | 7.26 | % | | | 20,950 | | | 342 | | 6.55 | % |
| Total Securities: | | | 582,639 | | | 6,445 | | 4.44 | % | | | 594,461 | | | 6,811 | | 4.65 | % | | | 667,502 | | | 7,756 | | 4.66 | % |
| Loans Held for Sale | | | 7,656 | | | 110 | | 5.76 | % | | | 7,125 | | | 106 | | 6.03 | % | | | 15,406 | | | 162 | | 4.22 | % |
| Loans | | | | | | | | | | | | | | | | | | |
| Commercial and Industrial | | | 401,430 | | | 4,874 | | 4.87 | % | | | 377,855 | | | 4,417 | | 4.74 | % | | | 337,292 | | | 3,974 | | 4.73 | % |
| Commercial Real Estate | | | 1,645,452 | | | 23,691 | | 5.77 | % | | | 1,630,944 | | | 23,089 | | 5.74 | % | | | 1,444,091 | | | 22,079 | | 6.13 | % |
| Commercial Construction | | | 166,040 | | | 2,098 | | 5.07 | % | | | 171,535 | | | 2,076 | | 4.91 | % | | | 203,171 | | | 2,661 | | 5.25 | % |
| Small Business | | | 81,319 | | | 1,202 | | 5.93 | % | | | 82,476 | | | 1,217 | | 5.98 | % | | | 87,200 | | | 1,299 | | 5.98 | % |
| Total Commercial | | | 2,294,241 | | | 31,865 | | 5.57 | % | | | 2,262,810 | | | 30,799 | | 5.52 | % | | | 2,071,754 | | | 30,013 | | 5.81 | % |
| Residential Real Estate | | | 537,475 | | | 6,485 | | 4.84 | % | | | 548,533 | | | 6,765 | | 5.00 | % | | | 600,238 | | | 7,674 | | 5.13 | % |
| Residential Construction | | | 7,507 | | | 95 | | 5.08 | % | | | 9,102 | | | 118 | | 5.26 | % | | | 12,841 | | | 234 | | 7.31 | % |
| Consumer - Home Equity | | | 490,197 | | | 4,704 | | 3.85 | % | | | 478,324 | | | 4,522 | | 3.83 | % | | | 452,257 | | | 4,426 | | 3.93 | % |
| Total Consumer Real Estate | | | 1,035,179 | | | 11,284 | | 4.37 | % | | | 1,035,959 | | | 11,405 | | 4.46 | % | | | 1,065,336 | | | 12,334 | | 4.64 | % |
| Consumer - Auto | | | 62,932 | | | 1,112 | | 7.09 | % | | | 73,656 | | | 1,278 | | 7.04 | % | | | 111,108 | | | 1,922 | | 6.94 | % |
| Consumer - Other | | | 29,749 | | | 672 | | 9.06 | % | | | 31,484 | | | 734 | | 9.45 | % | | | 36,565 | | | 798 | | 8.75 | % |
| Total Other Consumer | | | 92,681 | | | 1,784 | | 7.72 | % | | | 105,140 | | | 2,012 | | 7.76 | % | | | 147,673 | | | 2,720 | | 7.39 | % |
| Total Loans | | | 3,422,101 | | | 44,933 | | 5.27 | % | | | 3,403,909 | | | 44,216 | | 5.27 | % | | | 3,284,763 | | | 45,067 | | 5.50 | % |
| Total Interest-Earning Assets | | $ | 4,201,372 | | $ | 51,596 | | 4.93 | % | | $ | 4,028,620 | | $ | 51,157 | | 5.15 | % | | $ | 4,054,554 | | $ | 53,055 | | 5.25 | % |
| Cash and Due from Banks | | | 71,322 | | | | | | | 66,424 | | | | | | | 77,263 | | | | |
| Federal Home Loan Bank Stock | | | 35,854 | | | | | | | 35,854 | | | | | | | 35,065 | | | | |
| Other Assets | | | 305,041 | | | | | | | 304,200 | | | | | | | 299,108 | | | | |
| Total Assets | | $ | 4,613,589 | | | | | | $ | 4,435,098 | | | | | | $ | 4,465,990 | | | | |
| Interest-bearing Liabilities: | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | |
| Savings and Interest Checking Accounts | | $ | 1,182,343 | | $ | 1,297 | | 0.44 | % | | $ | 1,056,156 | | $ | 1,184 | | 0.45 | % | | $ | 964,929 | | $ | 1,326 | | 0.55 | % |
| Money Market | | | 760,240 | | | 1,320 | | 0.70 | % | | | 702,390 | | | 1,320 | | 0.76 | % | | | 666,232 | | | 1,713 | | 1.03 | % |
| Time Deposits | | | 842,539 | | | 2,868 | | 1.37 | % | | | 889,449 | | | 3,435 | | 1.57 | % | | | 974,449 | | | 5,402 | | 2.22 | % |
| Total interest-bearing deposits: | | $ | 2,785,122 | | $ | 5,485 | | 0.79 | % | | $ | 2,647,995 | | $ | 5,939 | | 0.91 | % | | $ | 2,605,610 | | $ | 8,441 | | 1.30 | % |
| Borrowings: | | | | | | | | | | | | | | | | | | |
| Federal Home Loan Bank Borrowings | | $ | 324,168 | | $ | 2,392 | | 2.96 | % | | $ | 340,301 | | $ | 2,432 | | 2.90 | % | | $ | 449,311 | | $ | 2,972 | | 2.65 | % |
| Federal Funds Purchased and Assets Sold | | | | | | | | | | | | | | | | | | |
| Under Repurchase Agreement | | | 182,810 | | | 821 | | 1.80 | % | | | 184,624 | | | 830 | | 1.82 | % | | | 173,992 | | | 812 | | 1.87 | % |
| Junior Subordinated Debentures | | | 61,857 | | | 913 | | 5.92 | % | | | 61,857 | | | 902 | | 5.91 | % | | | 61,857 | | | 940 | | 6.10 | % |
| Subordinated Debentures | | | 30,000 | | | 541 | | 7.23 | % | | | 30,000 | | | 535 | | 7.23 | % | | | 30,000 | | | 541 | | 7.23 | % |
| Other Borrowings | | | 3,148 | | | - | | 0.00 | % | | | 2,360 | | | - | | 0.00 | % | | | 2,105 | | | - | | 0.00 | % |
| Total Borrowings: | | | 601,983 | | | 4,667 | | 3.11 | % | | | 619,142 | | | 4,699 | | 3.08 | % | | | 717,265 | | | 5,265 | | 2.94 | % |
| Total Interest-Bearing Liabilities | | $ | 3,387,105 | | $ | 10,152 | | 1.20 | % | | $ | 3,267,137 | | $ | 10,638 | | 1.32 | % | | $ | 3,322,875 | | $ | 13,706 | | 1.65 | % |
| Demand Deposits | | | 752,622 | | | | | | | 702,833 | | | | | | | 673,448 | | | | |
| | | | | | | | | | | | | | | | | | |
| Other Liabilities | | | 49,870 | | | | | | | 47,020 | | | | | | | 61,582 | | | | |
| Total Liabilities | | $ | 4,189,597 | | | | | | $ | 4,016,990 | | | | | | $ | 4,057,905 | | | | |
| Stockholders' Equity | | | 423,992 | | | | | | | 418,108 | | | | | | | 408,085 | | | | |
| Total Liabilities and Stockholders' Equity | | $ | 4,613,589 | | | | | | $ | 4,435,098 | | | | | | $ | 4,465,990 | | | | |
| | | | | | | | | | | | | | | | | | |
| Net Interest Income | | | | $ | 41,444 | | | | | | $ | 40,519 | | | | | | $ | 39,349 | | |
| | | | | | | | | | | | | | | | | | |
| Interest Rate Spread (2) | | | | | | 3.72 | % | | | | | | 3.83 | % | | | | | | 3.59 | % |
| | | | | | | | | | | | | | | | | | |
| Net Interest Margin (3) | | | | | | 3.96 | % | | | | | | 4.08 | % | | | | | | 3.89 | % |
| | | | | | | | | | | | | | | | | | |
| Supplemental Information: | | | | | | | | | | | | | | | | | | |
| Total Deposits, including Demand Deposits | | $ | 3,537,744 | | $ | 5,485 | | | | $ | 3,350,828 | | $ | 5,939 | | | | $ | 3,279,058 | | $ | 8,441 | | |
| Cost of Total Deposits | | | | | | 0.62 | % | | | | | | 0.72 | % | | | | | | 1.03 | % |
| Total Funding Liabilities, including Demand Deposits | | $ | 4,139,727 | | $ | 10,152 | | | | $ | 3,969,970 | | $ | 10,638 | | | | $ | 3,996,323 | | $ | 13,706 | | |
| Cost of Total Funding Liabilities | | | | | | 0.98 | % | | | | | | 1.09 | % | | | | | | 1.38 | % |
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| (1) The total amount of adjustment to present interest income and yield on a fully tax-equivalent basis is $277, $309, and $249 for the three months ended June 30, 2010, March 31, 2010, and June 30, 2009, respectively. |
| (2) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. |
(3) Net interest margin represents annualized net interest income as a percentage of average interest-earning assets. |
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| (Unaudited - Dollars in Thousands) | | | | | | | | | | | | |
| | | | | | | | | | | | |
| | Six Months Ended |
| | June 30, 2010 | | June 30, 2009 |
| | | | Interest | | | | | | Interest | | |
| | Average | | Earned/ | | Yield/ | | Average | | Earned/ | | Yield/ |
| | Balance | | Paid | | Rate | | Balance | | Paid | | Rate |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
| Interest-Earning Assets: | | | | | | | | | | | | |
| Interest Earning Deposits with Banks, Federal Funds Sold, and Short Term Investments | | $ | 106,509 | | $ | 132 | | 0.25 | % | | $ | 104,043 | | $ | 268 | | 0.52 | % |
| Securities: | | | | | | | | | | | | |
| Trading Assets | | | 7,085 | | | 122 | | 3.47 | % | | | 8,367 | | | 69 | | 1.66 | % |
| Taxable Investment Securities | | | 563,021 | | | 12,476 | | 4.47 | % | | | 599,376 | | | 14,307 | | 4.81 | % |
| Non-taxable Investment Securities (1) | | | 18,411 | | | 658 | | 7.21 | % | | | 25,530 | | | 809 | | 6.39 | % |
| Total Securities: | | | 588,517 | | | 13,256 | | 4.54 | % | | | 633,273 | | | 15,185 | | 4.84 | % |
| Loans Held for Sale | | | 7,392 | | | 216 | | 5.89 | % | | | 15,260 | | | 328 | | 4.33 | % |
| Loans | | | | | | | | | | | | |
| Commercial and Industrial | | | 389,708 | | | 9,291 | | 4.81 | % | | | 306,060 | | | 7,276 | | 4.79 | % |
| Commercial Real Estate | | | 1,638,238 | | | 46,780 | | 5.76 | % | | | 1,287,427 | | | 39,147 | | 6.13 | % |
| Commercial Construction | | | 168,773 | | | 4,174 | | 4.99 | % | | | 188,918 | | | 4,577 | | 4.89 | % |
| Small Business | | | 81,894 | | | 2,419 | | 5.96 | % | | | 87,191 | | | 2,588 | | 5.99 | % |
| Total Commercial | | | 2,278,613 | | | 62,664 | | 5.55 | % | | | 1,869,596 | | | 53,588 | | 5.78 | % |
| Residential Real Estate | | | 542,974 | | | 13,250 | | 4.92 | % | | | 504,774 | | | 12,970 | | 5.18 | % |
| Residential Construction | | | 8,300 | | | 213 | | 5.18 | % | | | 11,888 | | | 406 | | 6.89 | % |
| Consumer - Home Equity | | | 484,293 | | | 9,226 | | 3.84 | % | | | 430,181 | | | 8,436 | | 3.95 | % |
| Total Consumer Real Estate | | | 1,035,567 | | | 22,689 | | 4.42 | % | | | 946,843 | | | 21,812 | | 4.65 | % |
| Consumer - Auto | | | 68,264 | | | 2,390 | | 7.06 | % | | | 116,647 | | | 3,966 | | 6.86 | % |
| Consumer - Other | | | 30,611 | | | 1,406 | | 9.26 | % | | | 37,024 | | | 1,600 | | 8.71 | % |
| Total Other Consumer | | | 98,875 | | | 3,796 | | 7.74 | % | | | 153,671 | | | 5,566 | | 7.30 | % |
| Total Loans | | | 3,413,055 | | | 89,149 | | 5.27 | % | | | 2,970,110 | | | 80,966 | | 5.50 | % |
| Total Interest-Earning Assets | | $ | 4,115,473 | | $ | 102,753 | | 5.03 | % | | $ | 3,722,686 | | $ | 96,747 | | 5.24 | % |
| Cash and Due from Banks | | | 68,887 | | | | | | | 68,718 | | | | |
| Federal Home Loan Bank Stock | | | 35,854 | | | | | | | 29,863 | | | | |
| Other Assets | | | 304,622 | | | | | | | 275,340 | | | | |
| Total Assets | | $ | 4,524,836 | | | | | | $ | 4,096,607 | | | | |
| Interest-bearing Liabilities: | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | |
| Savings and Interest Checking Accounts | | $ | 1,119,598 | | $ | 2,481 | | 0.45 | % | | $ | 853,096 | | $ | 2,322 | | 0.55 | % |
| Money Market | | | 731,475 | | | 2,641 | | 0.73 | % | | | 592,743 | | | 3,409 | | 1.16 | % |
| Time Deposits | | | 865,864 | | | 6,302 | | 1.47 | % | | | 903,218 | | | 11,117 | | 2.48 | % |
| Total interest-bearing deposits: | | $ | 2,716,937 | | $ | 11,424 | | 0.85 | % | | $ | 2,349,057 | | $ | 16,848 | | 1.45 | % |
| Borrowings: | | | | | | | | | | | | |
| Federal Home Loan Bank Borrowings | | $ | 332,190 | | $ | 4,823 | | 2.93 | % | | $ | 429,827 | | $ | 5,647 | | 2.65 | % |
| Federal Funds Purchased and Assets Sold | | | | | | | | | | | | |
| Under Repurchase Agreement | | | 183,712 | | | 1,651 | | 1.81 | % | | | 173,441 | | | 1,668 | | 1.94 | % |
| Junior Subordinated Debentures | | | 61,857 | | | 1,815 | | 5.92 | % | | | 61,857 | | | 1,887 | | 6.15 | % |
| Subordinated Debentures | | | 30,000 | | | 1,077 | | 7.24 | % | | | 30,000 | | | 1,078 | | 7.25 | % |
| Other Borrowings | | | 2,756 | | | - | | 0.00 | % | | | 1,939 | | | - | | 0.00 | % |
| Total Borrowings: | | | 610,515 | | | 9,366 | | 3.09 | % | | | 697,064 | | | 10,280 | | 2.97 | % |
| Total Interest-Bearing Liabilities | | $ | 3,327,452 | | $ | 20,790 | | 1.26 | % | | $ | 3,046,121 | | $ | 27,128 | | 1.80 | % |
| Demand Deposits | | | 727,865 | | | | | | | 602,331 | | | | |
| | | | | | | | | | | | |
| Other Liabilities | | | 48,453 | | | | | | | 52,048 | | | | |
| Total Liabilities | | $ | 4,103,770 | | | | | | $ | 3,700,500 | | | | |
| Stockholders' Equity | | | 421,066 | | | | | | | 396,107 | | | | |
| Total Liabilities and Stockholders' Equity | | $ | 4,524,836 | | | | | | $ | 4,096,607 | | | | |
| | | | | | | | | | | | |
| Net Interest Income | | | | $ | 81,963 | | | | | | $ | 69,619 | | |
| | | | | | | | | | | | |
| Interest Rate Spread (2) | | | | | | 3.77 | % | | | | | | 3.44 | % |
| | | | | | | | | | | | |
| Net Interest Margin (3) | | | | | | 4.02 | % | | | | | | 3.77 | % |
| | | | | | | | | | | | |
| Supplemental Information: | | | | | | | | | | | | |
| Total Deposits, including Demand Deposits | | $ | 3,444,802 | | $ | 11,424 | | | | $ | 2,951,388 | | $ | 16,848 | | |
| Cost of Total Deposits | | | | | | 0.67 | % | | | | | | 1.15 | % |
| Total Funding Liabilities, including Demand Deposits | | $ | 4,055,317 | | $ | 20,790 | | | | $ | 3,648,452 | | $ | 27,128 | | |
| Cost of Total Funding Liabilities | | | | | | 1.03 | % | | | | | | 1.50 | % |
| | | | | | | | | | | | |
| (1) The total amount of adjustment to present interest income and yield on a fully tax-equivalent basis is $586 and $531 for the six months ended June 30, 2010, and June 30, 2009, respectively. |
| (2) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. |
| (3) Net interest margin represents annualized net interest income as a percentage of average interest-earning assets. |
| |
| Certain amounts in prior year financial statement have been reclassified to conform to the current year's presentation. |
CONTACT:
Independent Bank Corp.
Chris Oddleifson, 781-982-6660
President and
Chief Executive Officer
or
Denis K. Sheahan, 781-982-6341
Chief Financial Officer
