| July 19, 2010 | Exhibit 99.1 |
Park National Corporation reports second quarter 2010
financial results and declares quarterly cash dividend
NEWARK, Ohio — Park National Corporation (Park) (NYSE Amex: PRK) today announced operating results for the three and six months ended June 30, 2010 (second quarter and first half of 2010). Park's Board of Directors also today declared a $0.94 per common share quarterly cash dividend, payable on September 10, 2010 to common shareholders of record as of August 25, 2010.
“We are pleased to report business loan growth in the second quarter of this year. Also, extraordinarily low residential mortgage rates continue to help generate significant consumer lending activity, including $244 million in mortgage loan originations for the first half of 2010,” said Park Chairman C. Daniel DeLawder. “Our lenders are focused on supporting each community we serve through high-quality, reliable lending with consistent underwriting. As economic conditions slowly improve, we hope to further expand our loan balances and reduce problem credits.”
Park’s second quarter net income was $21.2 million, compared to $21.3 million for the same period in 2009. Net income was $41.9 million for first half of 2010, a 1.8 percent decline from the first half of 2009 net income of $42.7 million.
Net income for Park's Ohio-based operations was $56.2 million for the first half of 2010, a 5.4 percent increase from the $53.3 million reported in the first half of 2009. Net income for Park’s Ohio-based operations was $27.9 million for the second quarter of 2010, the same as the $27.9 million reported in the second quarter of 2009.
While Park’s net income modestly declined for the second quarter and first half of 2010 in comparison to the same periods in 2009, earnings per common share for those periods declined by a greater percentage as a result of the issuance of common shares over the last five quarters. Second quarter 2010 net income per diluted common share was $1.30, an 8.5 percent decline from the $1.42 in the second quarter of 2009. Net income per diluted common share for the first half of 2010 was $2.60, an 8.8 percent decline from the $2.85 in the first half of 2009.
Exercise of common share warrants and issuance of common shares
Over the past five quarters, common shares outstanding have increased by 1,228,172 or 8.8 percent, as a result of capital raising activities. During 2009, Park sold 904,072 common shares and Series A and Series B Common Share Warrants covering an aggregate of 500,000 common shares at a weighted average price per share of $61.20 for gross proceeds of $55.3 million. Net of selling expenses and professional fees, Park raised $53.5 million of common equity from these capital raising activities in 2009. During the second quarter of 2010, 324,100 common shares were issued upon the exercise of the Series A and Series B Common Share Warrants at a price of $67.75 per common share. Net of all expenses, Park raised an additional $21.3 million of common equity from the sale of these 324,100 common shares. Series B Common Share Warrants covering 175,900 common shares, with an exercise price of $67.75 per common share and an expiration date of October 30, 2010, remain outstanding.
Loan portfolio information
Park’s loan portfolio experienced solid growth during the 2010 second quarter, increasing $58.7 million to end the quarter at $4.66 billion. For the first half of 2010, Park’s loans have increased by $15.6 million. Park’s Ohio-based operations experienced loan growth of approximately $61.5 million and $20.9 million in the second quarter and first half of 2010, respectively.
Park National Corporation
50 N. Third Street, Newark, Ohio 43055
www.parknationalcorp.com
Net charge-offs for the first half of 2010 were $25.8 million, or an annualized 1.13 percent of average loans outstanding. This compares to $23.4 million, or an annualized 1.03 percent of average loans outstanding, for the same period in 2009.
Park's loan loss provision for the first half of 2010 was $29.8 million, compared to $28.1 million for the same period in 2009. Of the $29.8 million loan loss provision, $20.2 million was recorded at Vision Bank, with the remaining $9.6 million recorded within Park's Ohio-based operations. Overall, the allowance for loan losses increased by $4.0 million during the first half of 2010, ending the period at $120.7 million, or 2.59 percent of period-end loans.
Additional information
During the 2010 second quarter, Park completed the sale of approximately $56.8 million of investment securities, which resulted in a pre-tax gain of $3.5 million.
Headquartered in Newark, Ohio, Park National Corporation has $7.1 billion in total assets (as of June 30, 2010). Park consists of 13 community bank divisions and two specialty finance companies. Park's Ohio-based banking operations are conducted through Park subsidiary The Park National Bank and its divisions which include Fairfield National Bank Division, Richland Bank Division, Century National Bank Division, First-Knox National Bank Division, Farmers & Savings Bank Division, United Bank Division, Second National Bank Division, Security National Bank Division, Unity National Bank Division and The Park National Bank of Southwest Ohio & Northern Kentucky Division. Park's other banking subsidiary is Vision Bank (headquartered in Panama City, Florida), and its Vision Bank Division (of Gulf Shores, Alabama). Park also includes Scope Leasing, Inc. (d.b.a. Scope Aircraft Finance) and Guardian Financial Services Company (d.b.a. Guardian Finance Company).
Complete financial tables are included below.
Park National Corporation
50 N. Third Street, Newark, Ohio 43055
www.parknationalcorp.com
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This news release contains forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management's expectations and are subject to a number of risks and uncertainties. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include, without limitation: deterioration in the asset value of Park's loan portfolio may be worse than expected due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than assumed and cash flows may be worse than expected; Park's ability to execute its business plan successfully and within the expected timeframe; general economic and financial market conditions, and weakening in the economy, specifically, the real estate market and credit market, either nationally or in the states in which Park and its subsidiaries do business, may be worse than expected which could decrease the demand for loan, deposit and other financial services and increase loan delinquencies and defaults; the effects of the Gulf of Mexico oil spill; changes in market rates and prices may adversely impact the value of securities, loans, deposits and other financial instruments and the interest rate sensitivity of our consolidated balance sheet; changes in consumer spending, borrowing and saving habits; our liquidity requirements could be adversely affected by changes in our assets and liabilities; competitive factors among financial institutions increase significantly, including product and pricing pressures and our ability to attract, develop and retain qualified bank professionals; the nature, timing and effect of changes in banking regulations or other regulatory or legislative requirements affecting the respective businesses of Park and its subsidiaries, including changes in laws and regulations concerning taxes, accounting, banking, securities and other aspects of the financial services industry, specifically the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; the effect of fiscal and governmental policies of the United States federal government; demand for loans in the respective market areas served by Park and its subsidiaries, and other risk factors relating to the banking industry as detailed from time to time in Park's reports filed with the Securities and Exchange Commission including those described in "Item 1A. Risk Factors" of Part I of Park's Annual Report on Form 10-K for the fiscal year ended December 31, 2009 and in "Item 1A. Risk Factors" of Part II of Park's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. Undue reliance should not be placed on the forward-looking statements, which speak only as of the date hereof. Park does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.
Park National Corporation
50 N. Third Street, Newark, Ohio 43055
www.parknationalcorp.com
PARK NATIONAL CORPORATION
Financial Highlights
Three months ended June 30, 2010, March 31, 2010 and June 30, 2009
| | | 2010 | | | 2009 | | | | Percent change vs. | |
| (in thousands, except share and per share data) | | 2nd QTR | | | 1st QTR | | | 2nd QTR | | | | 1Q '10 | | | 2Q '09 | |
| INCOME STATEMENT: | | | | | | | | | | | | | | | | |
| Net interest income | | $ | 68,721 | | | $ | 67,380 | | | $ | 67,994 | | | | | 2.0 | % | | | 1.1 | % |
| Provision for loan losses | | | 13,250 | | | | 16,550 | | | | 15,856 | | | | | -19.9 | % | | | -16.4 | % |
| Other income | | | 16,647 | | | | 16,710 | | | | 19,757 | | | | | -0.4 | % | | | -15.7 | % |
| Gain on sale of securities | | | 3,515 | | | | 8,304 | | | | 7,340 | | | | | -57.7 | % | | | -52.1 | % |
| Total other expense | | | 47,001 | | | | 47,890 | | | | 50,151 | | | | | -1.9 | % | | | -6.3 | % |
| Income before income taxes | | $ | 28,632 | | | $ | 27,954 | | | $ | 29,084 | | | | | 2.4 | % | | | -1.6 | % |
| Income taxes | | | 7,466 | | | | 7,175 | | | | 7,777 | | | | | 4.1 | % | | | -4.0 | % |
| Net income | | $ | 21,166 | | | $ | 20,779 | | | $ | 21,307 | | | | | 1.9 | % | | | -0.7 | % |
| Preferred stock dividends and accretion | | | 1,451 | | | | 1,452 | | | | 1,441 | | | | | -0.1 | % | | | 0.7 | % |
| Net income available to common shareholders | | $ | 19,715 | | | $ | 19,327 | | | $ | 19,866 | | | | | 2.0 | % | | | -0.8 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| MARKET DATA: | | | | | | | | | | | | | | | | | | | | | |
| Earnings per common share - basic (b) | | $ | 1.30 | | | $ | 1.30 | | | $ | 1.42 | | | | | 0.0 | % | | | -8.5 | % |
| Earnings per common share - diluted (b) | | | 1.30 | | | | 1.30 | | | | 1.42 | | | | | 0.0 | % | | | -8.5 | % |
| Cash dividends per common share | | | 0.94 | | | | 0.94 | | | | 0.94 | | | | | 0.0 | % | | | 0.0 | % |
| Common book value per common share at period end | | | 42.94 | | | | 41.94 | | | | 40.20 | | | | | 2.4 | % | | | 6.8 | % |
| Stock price per common share at period end | | | 65.04 | | | | 62.31 | | | | 56.48 | | | | | 4.4 | % | | | 15.2 | % |
| Market capitalization at period end | | | 989,054 | | | | 927,345 | | | | 799,469 | | | | | 6.7 | % | | | 23.7 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| Weighted average common shares - basic (a) | | | 15,114,846 | | | | 14,882,774 | | | | 14,001,608 | | | | | 1.6 | % | | | 8.0 | % |
| Weighted average common shares - diluted (a) | | | 15,114,846 | | | | 14,882,774 | | | | 14,001,608 | | | | | 1.6 | % | | | 8.0 | % |
| Common shares outstanding at period end | | | 15,206,854 | | | | 14,882,765 | | | | 14,154,908 | | | | | 2.2 | % | | | 7.4 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| PERFORMANCE RATIOS: | | | | | | | | | | | | | | | | | | | | | |
| Annualized return on average assets (a)(b) | | | 1.13 | % | | | 1.11 | % | | | 1.13 | % | | | | 1.8 | % | | | 0.0 | % |
| Annualized return on average common equity (a)(b) | | | 12.27 | % | | | 12.43 | % | | | 14.11 | % | | | | -1.3 | % | | | -13.0 | % |
| Yield on loans | | | 5.84 | % | | | 5.87 | % | | | 6.02 | % | | | | -0.5 | % | | | -3.0 | % |
| Yield on investments | | | 4.44 | % | | | 4.43 | % | | | 4.92 | % | | | | 0.2 | % | | | -9.8 | % |
| Yield on earning assets | | | 5.44 | % | | | 5.45 | % | | | 5.69 | % | | | | -0.2 | % | | | -4.4 | % |
| Cost of interest bearing deposits | | | 1.04 | % | | | 1.15 | % | | | 1.59 | % | | | | -9.6 | % | | | -34.6 | % |
| Cost of borrowings | | | 2.94 | % | | | 2.90 | % | | | 2.41 | % | | | | 1.4 | % | | | 22.0 | % |
| Cost of paying liabilities | | | 1.40 | % | | | 1.49 | % | | | 1.78 | % | | | | -6.0 | % | | | -21.3 | % |
| Net interest margin (annualized) (g) | | | 4.29 | % | | | 4.22 | % | | | 4.21 | % | | | | 1.7 | % | | | 1.9 | % |
| Efficiency ratio (g) | | | 54.75 | % | | | 56.63 | % | | | 56.81 | % | | | | -3.3 | % | | | -3.6 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| OTHER RATIOS (NON GAAP): | | | | | | | | | | | | | | | | | | | | | |
| Annualized return on average tangible assets (a)(b)(e) | | | 1.14 | % | | | 1.12 | % | | | 1.15 | % | | | | 1.8 | % | | | -0.9 | % |
| Annualized return on average tangible common equity (a)(b)(c) | | | 14.03 | % | | | 14.27 | % | | | 16.58 | % | | | | -1.7 | % | | | -15.4 | % |
| Tangible common book value per common share (d) | | $ | 37.68 | | | $ | 36.51 | | | $ | 34.29 | | | | | 3.2 | % | | | 9.9 | % |
PARK NATIONAL CORPORATION
Financial Highlights (continued)
Three months ended June 30, 2010, March 31, 2010 and June 30, 2009
| | | | | | | | | | | | | Percent change vs. | |
| BALANCE SHEET: | | June 30, 2010 | | | March 31, 2010 | | | June 30, 2009 | | | | 1Q '10 | | | 2Q '09 | |
| Investment securities | | $ | 1,845,594 | | | $ | 1,941,465 | | | $ | 1,913,620 | | | | | -4.9 | % | | | -3.6 | % |
| Loans | | | 4,655,997 | | | | 4,597,304 | | | | 4,620,026 | | | | | 1.3 | % | | | 0.8 | % |
| Allowance for loan losses | | | 120,676 | | | | 119,674 | | | | 104,804 | | | | | 0.8 | % | | | 15.1 | % |
| Goodwill and other intangibles | | | 80,021 | | | | 80,863 | | | | 83,672 | | | | | -1.0 | % | | | -4.4 | % |
| Other real estate owned | | | 46,456 | | | | 45,854 | | | | 41,279 | | | | | 1.3 | % | | | 12.5 | % |
| Total assets | | | 7,093,098 | | | | 7,176,087 | | | | 7,007,610 | | | | | -1.2 | % | | | 1.2 | % |
| Total deposits | | | 5,168,814 | | | | 5,268,858 | | | | 5,053,424 | | | | | -1.9 | % | | | 2.3 | % |
| Borrowings | | | 1,008,748 | | | | 996,686 | | | | 1,180,688 | | | | | 1.2 | % | | | -14.6 | % |
| Stockholders' equity | | | 749,939 | | | | 720,898 | | | | 665,141 | | | | | 4.0 | % | | | 12.7 | % |
| Common equity | | | 653,053 | | | | 624,213 | | | | 569,039 | | | | | 4.6 | % | | | 14.8 | % |
| Tangible common equity (d) | | | 573,032 | | | | 543,350 | | | | 485,367 | | | | | 5.5 | % | | | 18.1 | % |
| Nonperforming loans | | | 237,854 | | | | 230,558 | | | | 206,581 | | | | | 3.2 | % | | | 15.1 | % |
| Nonperforming assets | | | 284,310 | | | | 276,412 | | | | 247,860 | | | | | 2.9 | % | | | 14.7 | % |
| Past due 90 day loans and still accruing | | | 17,283 | | | | 11,853 | | | | 4,417 | | | | | 45.8 | % | | | 291.3 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| ASSET QUALITY RATIOS: | | | | | | | | | | | | | | | | | | | | | |
| Loans as a % of period end assets | | | 65.64 | % | | | 64.06 | % | | | 65.93 | % | | | | 2.5 | % | | | -0.4 | % |
| Nonperforming loans as a % of period end loans | | | 5.11 | % | | | 5.02 | % | | | 4.47 | % | | | | 1.8 | % | | | 14.3 | % |
| Past due 90 day loans as a % of period end loans | | | 0.37 | % | | | 0.26 | % | | | 0.10 | % | | | | 42.3 | % | | | 270.0 | % |
| Nonperforming assets / Period end loans + OREO | | | 6.05 | % | | | 5.95 | % | | | 5.32 | % | | | | 1.7 | % | | | 13.7 | % |
| Allowance for loan losses as a % of period end loans | | | 2.59 | % | | | 2.60 | % | | | 2.27 | % | | | | -0.4 | % | | | 14.1 | % |
| Net loan charge-offs | | $ | 12,248 | | | $ | 13,593 | | | $ | 12,331 | | | | | -9.9 | % | | | -0.7 | % |
| Annualized net loan charge-offs as a % of average loans (a) | | | 1.07 | % | | | 1.19 | % | | | 1.08 | % | | | | -10.1 | % | | | -0.9 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| CAPITAL & LIQUIDITY: | | | | | | | | | | | | | | | | | | | | | |
| Total equity / Period end assets | | | 10.57 | % | | | 10.05 | % | | | 9.49 | % | | | | 5.2 | % | | | 11.4 | % |
| Common equity / Period end assets | | | 9.21 | % | | | 8.70 | % | | | 8.12 | % | | | | 5.9 | % | | | 13.4 | % |
| Tangible common equity (d) / Tangible assets (f) | | | 8.17 | % | | | 7.66 | % | | | 7.01 | % | | | | 6.7 | % | | | 16.5 | % |
| Average equity / Average assets (a) | | | 10.56 | % | | | 10.26 | % | | | 9.40 | % | | | | 2.9 | % | | | 12.3 | % |
| Average equity / Average loans (a) | | | 16.09 | % | | | 15.75 | % | | | 14.41 | % | | | | 2.2 | % | | | 11.7 | % |
| Average loans / Average deposits (a) | | | 88.85 | % | | | 88.19 | % | | | 91.52 | % | | | | 0.7 | % | | | -2.9 | % |
PARK NATIONAL CORPORATION
Financial Highlights (continued)
Six months ended June 30, 2010 and 2009
| | | June 30, | | | June 30, | | | | Percent | |
| (in thousands, except share and per share data) | | 2010 | | | 2009 | | | | change | |
| INCOME STATEMENT: | | | | | | | | | | |
| Net interest income | | $ | 136,101 | | | $ | 136,227 | | | | | -0.1 | % |
| Provision for loan losses | | | 29,800 | | | | 28,143 | | | | | 5.9 | % |
| Other income | | | 33,357 | | | | 38,967 | | | | | -14.4 | % |
| Gain on sale of securities | | | 11,819 | | | | 7,340 | | | | | 61.0 | % |
| Total other expense | | | 94,891 | | | | 96,013 | | | | | -1.2 | % |
| Income before income taxes | | $ | 56,586 | | | $ | 58,378 | | | | | -3.1 | % |
| Income taxes | | | 14,641 | | | | 15,681 | | | | | -6.6 | % |
| Net income | | $ | 41,945 | | | $ | 42,697 | | | | | -1.8 | % |
| Preferred stock dividends and accretion | | | 2,903 | | | | 2,881 | | | | | 0.8 | % |
| Net income available to common shareholders | | $ | 39,042 | | | $ | 39,816 | | | | | -1.9 | % |
| | | | | | | | | | | | | | |
| MARKET DATA: | | | | | | | | | | | | | |
| Earnings per commmon share - basic (b) | | $ | 2.60 | | | $ | 2.85 | | | | | -8.8 | % |
| Earnings per common share - diluted (b) | | | 2.60 | | | | 2.85 | | | | | -8.8 | % |
| Cash dividends per common share | | | 1.88 | | | | 1.88 | | | | | 0.0 | % |
| | | | | | | | | | | | | | |
| Weighted average common shares - basic (a) | | | 14,998,810 | | | | 13,986,664 | | | | | 7.2 | % |
| Weighted average common shares - diluted (a) | | | 14,998,810 | | | | 13,986,664 | | | | | 7.2 | % |
| | | | | | | | | | | | | | |
| PERFORMANCE RATIOS: | | | | | | | | | | | | | |
| Annualized return on average assets (a)(b) | | | 1.12 | % | | | 1.15 | % | | | | -2.6 | % |
| Annualized return on average common equity (a)(b) | | | 12.35 | % | | | 17.35 | % | | | | -28.8 | % |
| Yield on loans | | | 5.86 | % | | | 6.10 | % | | | | -3.9 | % |
| Yield on investments | | | 4.44 | % | | | 4.95 | % | | | | -10.3 | % |
| Yield on earning assets | | | 5.44 | % | | | 5.75 | % | | | | -5.4 | % |
| Cost of interest bearing deposits | | | 1.10 | % | | | 1.66 | % | | | | -33.7 | % |
| Cost of borrowings | | | 2.92 | % | | | 2.28 | % | | | | 28.1 | % |
| Cost of paying liabilities | | | 1.44 | % | | | 1.81 | % | | | | -20.4 | % |
| Net interest margin (annualized) (g) | | | 4.25 | % | | | 4.24 | % | | | | 0.2 | % |
| Efficiency ratio (g) | | | 55.68 | % | | | 54.46 | % | | | | 2.2 | % |
| | | | | | | | | | | | | | |
| ASSET QUALITY RATIOS: | | | | | | | | | | | | | |
| Net loan charge-offs | | $ | 25,841 | | | $ | 23,427 | | | | | 10.3 | % |
| Annualized net loan charge-offs as a % of average loans (a) | | | 1.13 | % | | | 1.03 | % | | | | 9.7 | % |
| | | | | | | | | | | | | | |
| CAPITAL AND LIQUIDITY: | | | | | | | | | | | | | |
| Average equity / Average assets (a) | | | 10.41 | % | | | 9.29 | % | | | | 12.1 | % |
| Average equity / Average loans (a) | | | 15.92 | % | | | 14.33 | % | | | | 11.1 | % |
| Average loans / Average deposits (a) | | | 88.52 | % | | | 92.83 | % | | | | -4.6 | % |
| | | | | | | | | | | | | | |
| OTHER RATIOS (NON GAAP): | | | | | | | | | | | | | |
| Annualized return on average tangible assets (a)(b)(e) | | | 1.13 | % | | | 1.15 | % | | | | -1.7 | % |
| Annualized return on average tangible common equity (a)(b)(c) | | | 14.15 | % | | | 16.95 | % | | | | -16.5 | % |
PARK NATIONAL CORPORATION
Financial Highlights (continued)
(a) Averages are for the quarters ended June 30, 2010, March 31, 2010 and June 30, 2009, and the six-month periods ended June 30, 2010 and June 30, 2009.
(b) Reported measure uses net income available to common shareholders.
(c) Net income available to common shareholders for each period divided by average tangible common equity during the period. Average tangible common equity equals average stockholders' equity during the applicable period less (i) average preferred stock during the applicable period and (ii) average goodwill and other intangibles during the applicable period.
RECONCILIATION OF AVERAGE STOCKHOLDERS' EQUITY TO AVERAGE TANGIBLE COMMON EQUITY:
| | | THREE MONTHS ENDED | | | SIX MONTHS ENDED | |
| | | June 30, 2010 | | | March 31, 2010 | | | June 30, 2009 | | | June 30, 2010 | | | June 30, 2009 | |
| AVERAGE STOCKHOLDERS' EQUITY | | $ | 741,006 | | | $ | 727,237 | | | $ | 660,837 | | | $ | 734,160 | | | $ | 654,381 | |
| Less: Average preferred stock | | | 96,770 | | | | 96,568 | | | | 95,992 | | | | 96,670 | | | | 95,897 | |
Average goodwill and other intangibles | | | 80,469 | | | | 81,376 | | | | 84,199 | | | | 80,920 | | | | 84,668 | |
| AVERAGE TANGIBLE COMMON EQUITY | | $ | 563,767 | | | $ | 549,293 | | | $ | 480,646 | | | $ | 556,570 | | | $ | 473,816 | |
(d) Tangible common equity equals ending stockholders' equity less preferred stock and goodwill and other intangibles, in each case at the end of the period.
RECONCILIATION OF STOCKHOLDERS' EQUITY TO TANGIBLE COMMON EQUITY:
| | | June 30, 2010 | | | March 31, 2010 | | | June 30, 2009 | |
| STOCKHOLDERS' EQUITY | | $ | 749,939 | | | $ | 720,898 | | | $ | 665,141 | |
| Less: Preferred stock | | | 96,886 | | | | 96,685 | | | | 96,102 | |
| Goodwill and other intangibles | | | 80,021 | | | | 80,863 | | | | 83,672 | |
| TANGIBLE COMMON EQUITY | | $ | 573,032 | | | $ | 543,350 | | | $ | 485,367 | |
(e) Net income available to common shareholders for each period divided by average tangible assets during the period. Average tangible assets equals average assets less average goodwill and other intangibles.
RECONCILIATION OF AVERAGE ASSETS TO AVERAGE TANGIBLE ASSETS:
| | | THREE MONTHS ENDED | | | SIX MONTHS ENDED | |
| | | June 30, 2010 | | | March 31, 2010 | | | June 30, 2009 | | | June 30, 2010 | | | June 30, 2009 | |
| AVERAGE ASSETS | | $ | 7,018,710 | | | $ | 7,086,333 | | | $ | 7,030,456 | | | $ | 7,052,335 | | | $ | 7,045,010 | |
| Less: Average goodwill and other intangibles | | | 80,469 | | | | 81,376 | | | | 84,199 | | | | 80,920 | | | | 84,668 | |
| AVERAGE TANGIBLE ASSETS | | $ | 6,938,241 | | | $ | 7,004,957 | | | $ | 6,946,257 | | | $ | 6,971,415 | | | $ | 6,960,342 | |
(f) Tangible common equity divided by tangible assets. Tangible assets equals total assets less goodwill and other intangibles.
RECONCILIATION OF TOTAL ASSETS TO TANGIBLE ASSETS:
| | | June 30, 2010 | | | March 31, 2010 | | | June 30, 2009 | |
| TOTAL ASSETS | | $ | 7,093,098 | | | $ | 7,176,087 | | | $ | 7,007,610 | |
| Less: Goodwill and other intangibles | | | 80,021 | | | | 80,863 | | | | 83,672 | |
| TANGIBLE ASSETS | | $ | 7,013,077 | | | $ | 7,095,224 | | | $ | 6,923,938 | |
PARK NATIONAL CORPORATION
Financial Highlights (continued)
(g) Efficiency ratio is calculated by taking total other expense divided by the sum of fully taxable equivalent net interest income and other income. Fully taxable equivalent net interest income reconciliation is shown below assuming a 35% tax rate.
RECONCILIATION OF FULLY TAXABLE EQUIVALENT NET INTEREST INCOME TO NET INTEREST INCOME
| | | THREE MONTHS ENDED | | | SIX MONTHS ENDED | |
| | | June 30, 2010 | | | March 31, 2010 | | | June 30, 2009 | | | June 30, 2010 | | | June 30, 2009 | |
| Interest income | | $ | 87,242 | | | $ | 87,202 | | | $ | 92,092 | | | $ | 174,444 | | | $ | 185,457 | |
| Fully taxable equivalent adjustment | | | 473 | | | | 481 | | | | 524 | | | | 954 | | | | 1,100 | |
| Fully taxable equivalent interest income | | $ | 87,715 | | | $ | 87,683 | | | $ | 92,616 | | | $ | 175,398 | | | $ | 186,557 | |
| Interest expense | | | 18,521 | | | | 19,822 | | | | 24,097 | | | | 38,343 | | | | 49,230 | |
| Fully taxable equivalent net interest income | | $ | 69,194 | | | $ | 67,861 | | | $ | 68,519 | | | $ | 137,055 | | | $ | 137,327 | |
PARK NATIONAL CORPORATION
Consolidated Statements of Income
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| (in thousands, except share and per share data) | | 2010 | | | 2009 | | | 2010 | | | 2009 | |
| | | | | | | | | | | | | |
| Interest income: | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 66,723 | | | $ | 68,496 | | | $ | 133,164 | | | $ | 137,584 | |
| Interest on: | | | | | | | | | | | | | | | | |
| Obligations of U.S. Government, its agencies and other securities | | | 20,263 | | | | 23,201 | | | | 40,738 | | | | 47,029 | |
| Obligations of states and political subdivisions | | | 204 | | | | 393 | | | | 421 | | | | 815 | |
| Other interest income | | | 52 | | | | 2 | | | | 121 | | | | 29 | |
| Total interest income | | | 87,242 | | | | 92,092 | | | | 174,444 | | | | 185,457 | |
| | | | | | | | | | | | | | | | | |
| Interest expense: | | | | | | | | | | | | | | | | |
| Interest on deposits: | | | | | | | | | | | | | | | | |
| Demand and savings deposits | | | 1,582 | | | | 2,809 | | | | 3,357 | | | | 5,714 | |
| Time deposits | | | 9,518 | | | | 13,800 | | | | 20,168 | | | | 28,174 | |
| Interest on borrowings | | | 7,421 | | | | 7,489 | | | | 14,818 | | | | 15,342 | |
| Total interest expense | | | 18,521 | | | | 24,098 | | | | 38,343 | | | | 49,230 | |
| | | | | | | | | | | | | | | | | |
| Net interest income | | | 68,721 | | | | 67,994 | | | | 136,101 | | | | 136,227 | |
| | | | | | | | | | | | | | | | | |
| Provision for loan losses | | | 13,250 | | | | 15,856 | | | | 29,800 | | | | 28,143 | |
| | | | | | | | | | | | | | | | | |
| Net interest income after provision for loan losses | | | 55,471 | | | | 52,138 | | | | 106,301 | | | | 108,084 | |
| | | | | | | | | | | | | | | | | |
| Other income | | | 16,647 | | | | 19,757 | | | | 33,357 | | | | 38,967 | |
| | | | | | | | | | | | | | | | | |
| Gain on sale of securities | | | 3,515 | | | | 7,340 | | | | 11,819 | | | | 7,340 | |
| | | | | | | | | | | | | | | | | |
| Other expense: | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 24,013 | | | | 25,334 | | | | 49,184 | | | | 50,821 | |
| Occupancy expense | | | 2,793 | | | | 2,882 | | | | 5,910 | | | | 6,040 | |
| Furniture and equipment expense | | | 2,564 | | | | 2,498 | | | | 5,196 | | | | 4,876 | |
| Other expense | | | 17,631 | | | | 19,437 | | | | 34,601 | | | | 34,276 | |
| Total other expense | | | 47,001 | | | | 50,151 | | | | 94,891 | | | | 96,013 | |
| | | | | | | | | | | | | | | | | |
| Income before income taxes | | | 28,632 | | | | 29,084 | | | | 56,586 | | | | 58,378 | |
| | | | | | | | | | | | | | | | | |
| Income taxes | | | 7,466 | | | | 7,777 | | | | 14,641 | | | | 15,681 | |
| | | | | | | | | | | | | | | | | |
| Net income | | $ | 21,166 | | | $ | 21,307 | | | $ | 41,945 | | | $ | 42,697 | |
| | | | | | | | | | | | | | | | | |
| Preferred stock dividends and accretion | | | 1,451 | | | | 1,441 | | | | 2,903 | | | | 2,881 | |
| | | | | | | | | | | | | | | | | |
| Net income available to common shareholders | | $ | 19,715 | | | $ | 19,866 | | | $ | 39,042 | | | $ | 39,816 | |
| | | | | | | | | | | | | | | | | |
| Per Common Share: | | | | | | | | | | | | | | | | |
| Net income - basic | | $ | 1.30 | | | $ | 1.42 | | | $ | 2.60 | | | $ | 2.85 | |
| Net income - diluted | | $ | 1.30 | | | $ | 1.42 | | | $ | 2.60 | | | $ | 2.85 | |
| | | | | | | | | | | | | | | | | |
| Weighted average shares - basic | | | 15,114,846 | | | | 14,001,608 | | | | 14,998,810 | | | | 13,986,664 | |
| Weighted average shares - diluted | | | 15,114,846 | | | | 14,001,608 | | | | 14,998,810 | | | | 13,986,664 | |
PARK NATIONAL CORPORATION
Consolidated Balance Sheets
| (in thousands, except share data) | | June 30, 2010 | | | Dec. 31, 2009 | | | June 30, 2009 | |
| | | | | | | | | | |
| Assets | | | | | | | | | |
| | | | | | | | | | |
| Cash and due from banks | | $ | 126,222 | | | $ | 116,802 | | | $ | 107,053 | |
| Money market instruments | | | 75,323 | | | | 42,289 | | | | 23,960 | |
| Investment securities | | | 1,845,594 | | | | 1,863,560 | | | | 1,913,620 | |
| Loans | | | 4,655,997 | | | | 4,640,432 | | | | 4,620,026 | |
| Allowance for loan losses | | | 120,676 | | | | 116,717 | | | | 104,804 | |
| Loans, net | | | 4,535,321 | | | | 4,523,715 | | | | 4,515,222 | |
| Bank premises and equipment, net | | | 68,929 | | | | 69,091 | | | | 67,254 | |
| Goodwill and other intangibles | | | 80,021 | | | | 81,799 | | | | 83,672 | |
| Other real estate owned | | | 46,456 | | | | 41,240 | | | | 41,279 | |
| Other assets | | | 315,232 | | | | 301,833 | | | | 255,550 | |
| | | | | | | | | | | | | |
| Total assets | | $ | 7,093,098 | | | $ | 7,040,329 | | | $ | 7,007,610 | |
| | | | | | | | | | | | | |
| Liabilities and Stockholders' Equity | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | |
| Noninterest bearing | | $ | 884,912 | | | | 897,243 | | | | 812,959 | |
| Interest bearing | | | 4,283,902 | | | | 4,290,809 | | | | 4,240,465 | |
| Total deposits | | | 5,168,814 | | | | 5,188,052 | | | | 5,053,424 | |
| Borrowings | | | 1,008,748 | | | | 1,053,850 | | | | 1,180,688 | |
| Other liabilities | | | 165,597 | | | | 81,163 | | | | 108,357 | |
| Total liabilities | | $ | 6,343,159 | | | $ | 6,323,065 | | | $ | 6,342,469 | |
| | | | | | | | | | | | | |
| Stockholders' Equity: | | | | | | | | | | | | |
| Preferred Stock (200,000 shares authorized in 2010 and 2009; 100,000 shares issued in 2010 and 2009) | | $ | 96,886 | | | $ | 96,483 | | | $ | 96,102 | |
| Common stock (No par value; 20,000,000 shares authorized in 2010 and 2009; 16,151,086 shares issued at June 30, 2010, 16,151,112 at December 31, 2009, and 16,151,137 at June 30, 2009) | | | 301,206 | | | | 301,208 | | | | 301,209 | |
| Common stock warrants | | | 4,761 | | | | 5,361 | | | | 4,297 | |
| Accumulated other comprehensive income, net of taxes | | | 15,879 | | | | 15,661 | | | | 8,612 | |
| Retained earnings | | | 427,236 | | | | 423,872 | | | | 446,028 | |
| Treasury stock (944,232 shares at June 30, 2010, 1,268,332 at December 31, 2009 and 2,179,424 shares at June 30, 2009) | | | (96,029 | ) | | | (125,321 | ) | | | (191,107 | ) |
| Total stockholders' equity | | $ | 749,939 | | | $ | 717,264 | | | $ | 665,141 | |
| | | | | | | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 7,093,098 | | | $ | 7,040,329 | | | $ | 7,007,610 | |
PARK NATIONAL CORPORATION
Consolidated Average Balance Sheets
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| (in thousands) | | 2010 | | | 2009 | | | 2010 | | | 2009 | |
| | | | | | | | | | | | | |
| Assets | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Cash and due from banks | | $ | 110,450 | | | $ | 98,026 | | | $ | 112,660 | | | $ | 113,032 | |
| Money market instruments | | | 94,669 | | | | 21,221 | | | | 110,146 | | | | 22,477 | |
| Investment securities | | | 1,814,859 | | | | 1,974,176 | | | | 1,826,563 | | | | 1,996,788 | |
| Loans | | | 4,604,481 | | | | 4,585,406 | | | | 4,610,944 | | | | 4,567,459 | |
| Allowance for loan losses | | | 120,424 | | | | 100,198 | | | | 118,857 | | | | 100,325 | |
| Loans, net | | | 4,484,057 | | | | 4,485,208 | | | | 4,492,087 | | | | 4,467,134 | |
| Bank premises and equipment, net | | | 69,286 | | | | 68,076 | | | | 69,419 | | | | 68,213 | |
| Goodwill and other intangibles | | | 80,469 | | | | 84,199 | | | | 80,920 | | | | 84,668 | |
| Other real estate owned | | | 46,127 | | | | 38,584 | | | | 44,061 | | | | 32,662 | |
| Other assets | | | 318,793 | | | | 260,966 | | | | 316,479 | | | | 260,036 | |
| | | | | | | | | | | | | | | | | |
| Total assets | | $ | 7,018,710 | | | $ | 7,030,456 | | | $ | 7,052,335 | | | $ | 7,045,010 | |
| | | | | | | | | | | | | | | | | |
| Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | |
| Noninterest bearing | | $ | 893,962 | | | $ | 824,841 | | | $ | 881,575 | | | | 799,319 | |
| Interest bearing | | | 4,288,551 | | | | 4,185,578 | | | | 4,327,568 | | | | 4,120,986 | |
| Total deposits | | | 5,182,513 | | | | 5,010,419 | | | | 5,209,143 | | | | 4,920,305 | |
| Borrowings | | | 1,013,006 | | | | 1,248,571 | | | | 1,024,382 | | | | 1,359,010 | |
| Other liabilities | | | 82,185 | | | | 110,629 | | | | 84,650 | | | | 111,314 | |
| Total liabilities | | $ | 6,277,704 | | | $ | 6,369,619 | | | $ | 6,318,175 | | | $ | 6,390,629 | |
| | | | | | | | | | | | | | | | | |
| Stockholders' Equity: | | | | | | | | | | | | | | | | |
| Preferred stock | | $ | 96,770 | | | $ | 95,992 | | | $ | 96,670 | | | $ | 95,897 | |
| Common stock | | | 301,246 | | | | 301,209 | | | | 301,226 | | | | 301,210 | |
| Common stock warrants | | | 4,943 | | | | 4,297 | | | | 5,151 | | | | 4,297 | |
| Accumulated other comprehensive income, net of taxes | | | 15,217 | | | | 13,088 | | | | 17,676 | | | | 11,054 | |
| Retained earnings | | | 427,363 | | | | 451,245 | | | | 428,306 | | | | 448,245 | |
| Treasury stock | | | (104,533 | ) | | | (204,994 | ) | | | (114,869 | ) | | | (206,322 | ) |
| Total stockholders' equity | | $ | 741,006 | | | $ | 660,837 | | | $ | 734,160 | | | $ | 654,381 | |
| | | | | | | | | | | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 7,018,710 | | | $ | 7,030,456 | | | $ | 7,052,335 | | | $ | 7,045,010 | |
PARK NATIONAL CORPORATION
Consolidated Statements of Income - Linked Quarters
| | | 2010 | | | 2010 | | | 2009 | | | 2009 | | | 2009 | |
| (in thousands, except per share data) | | 2nd QTR | | | 1st QTR | | | 4th QTR | | | 3rd QTR | | | 2nd QTR | |
| | | | | | | | | | | | | | | | |
| Interest income: | | | | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 66,723 | | | $ | 66,441 | | | $ | 68,676 | | | $ | 69,339 | | | $ | 68,496 | |
| Interest on: | | | | | | | | | | | | | | | | | | | | |
Obligations of U.S. Government, its agencies and other securities | | | 20,263 | | | | 20,475 | | | | 21,325 | | | | 22,204 | | | | 23,201 | |
| Obligations of states and political subdivisions | | | 204 | | | | 217 | | | | 286 | | | | 316 | | | | 393 | |
| Other interest income | | | 52 | | | | 69 | | | | 78 | | | | 9 | | | | 2 | |
| Total interest income | | | 87,242 | | | | 87,202 | | | | 90,365 | | | | 91,868 | | | | 92,092 | |
| | | | | | | | | | | | | | | | | | | | | |
| Interest expense: | | | | | | | | | | | | | | | | | | | | |
| Interest on deposits: | | | | | | | | | | | | | | | | | | | | |
| Demand and savings deposits | | | 1,582 | | | | 1,775 | | | | 2,333 | | | | 2,768 | | | | 2,809 | |
| Time deposits | | | 9,518 | | | | 10,650 | | | | 12,269 | | | | 13,362 | | | | 13,800 | |
| Interest on borrowings | | | 7,421 | | | | 7,397 | | | | 6,961 | | | | 7,276 | | | | 7,489 | |
| Total interest expense | | | 18,521 | | | | 19,822 | | | | 21,563 | | | | 23,406 | | | | 24,098 | |
| | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | 68,721 | | | | 67,380 | | | | 68,802 | | | | 68,462 | | | | 67,994 | |
| | | | | | | | | | | | | | | | | | | | | |
| Provision for loan losses | | | 13,250 | | | | 16,550 | | | | 25,720 | | | | 14,958 | | | | 15,856 | |
| | | | | | | | | | | | | | | | | | | | | |
| Net interest income after provision for loan losses | | | 55,471 | | | | 50,830 | | | | 43,082 | | | | 53,504 | | | | 52,138 | |
| | | | | | | | | | | | | | | | | | | | | |
| Other income | | | 16,647 | | | | 16,710 | | | | 16,718 | | | | 18,165 | | | | 19,757 | |
| | | | | | | | | | | | | | | | | | | | | |
| Gain on sale of securities | | | 3,515 | | | | 8,304 | | | | - | | | | - | | | | 7,340 | |
| | | | | | | | | | | | | | | | | | | | | |
| Other expense: | | | | | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 24,013 | | | | 25,171 | | | | 24,815 | | | | 25,589 | | | | 25,334 | |
| Occupancy expense | | | 2,793 | | | | 3,117 | | | | 2,740 | | | | 2,772 | | | | 2,882 | |
| Furniture and equipment expense | | | 2,564 | | | | 2,632 | | | | 2,395 | | | | 2,463 | | | | 2,498 | |
| Other expense | | | 17,631 | | | | 16,970 | | | | 16,710 | | | | 15,228 | | | | 19,437 | |
| Total other expense | | | 47,001 | | | | 47,890 | | | | 46,660 | | | | 46,052 | | | | 50,151 | |
| | | | | | | | | | | | | | | | | | | | | |
| Income before income taxes | | | 28,632 | | | | 27,954 | | | | 13,140 | | | | 25,617 | | | | 29,084 | |
| | | | | | | | | | | | | | | | | | | | | |
| Income taxes | | | 7,466 | | | | 7,175 | | | | 844 | | | | 6,418 | | | | 7,777 | |
| | | | | | | | | | | | | | | | | | | | | |
| Net income | | $ | 21,166 | | | $ | 20,779 | | | $ | 12,296 | | | $ | 19,199 | | | $ | 21,307 | |
| | | | | | | | | | | | | | | | | | | | | |
| Preferred stock dividends and accretion | | | 1,451 | | | | 1,452 | | | | 1,441 | | | | 1,440 | | | | 1,441 | |
| | | | | | | | | | | | | | | | | | | | | |
| Net income available to common shareholders | | $ | 19,715 | | | $ | 19,327 | | | $ | 10,855 | | | $ | 17,759 | | | $ | 19,866 | |
| | | | | | | | | | | | | | | | | | | | | |
| Per Common Share: | | | | | | | | | | | | | | | | | | | | |
| Net income - basic | | $ | 1.30 | | | $ | 1.30 | | | $ | 0.74 | | | $ | 1.25 | | | $ | 1.42 | |
| Net income - diluted | | $ | 1.30 | | | $ | 1.30 | | | $ | 0.74 | | | $ | 1.25 | | | $ | 1.42 | |
PARK NATIONAL CORPORATION
Detail of other income and other expense - Linked Quarters
| | | 2010 | | | 2010 | | | 2009 | | | 2009 | | | 2009 | |
| (in thousands) | | 2nd QTR | | | 1st QTR | | | 4th QTR | | | 3rd QTR | | | 2nd QTR | |
| | | | | | | | | | | | | | | | |
| Other income: | | | | | | | | | | | | | | | |
| Income from fiduciary activities | | $ | 3,528 | | | $ | 3,422 | | | $ | 3,397 | | | $ | 3,071 | | | $ | 3,140 | |
| Service charges on deposits | | | 5,092 | | | | 4,746 | | | | 5,604 | | | | 5,788 | | | | 5,432 | |
| Other service income | | | 3,476 | | | | 2,982 | | | | 3,588 | | | | 3,895 | | | | 5,738 | |
| Checkcard fee income | | | 2,765 | | | | 2,444 | | | | 2,488 | | | | 2,342 | | | | 2,381 | |
| Bank owned life insurance income | | | 1,254 | | | | 1,216 | | | | 1,329 | | | | 1,297 | | | | 1,235 | |
| Other | | | 532 | | | | 1,900 | | | | 312 | | | | 1,772 | | | | 1,831 | |
| Total other income | | $ | 16,647 | | | $ | 16,710 | | | $ | 16,718 | | | $ | 18,165 | | | $ | 19,757 | |
| | | | | | | | | | | | | | | | | | | | | |
| Other expense: | | | | | | | | | | | | | | | | | | | | |
| Salaries and employee benefits | | $ | 24,013 | | | $ | 25,171 | | | $ | 24,815 | | | $ | 25,589 | | | $ | 25,334 | |
| Net occupancy expense | | | 2,793 | | | | 3,117 | | | | 2,740 | | | | 2,772 | | | | 2,882 | |
| Furniture and equipment expense | | | 2,564 | | | | 2,632 | | | | 2,395 | | | | 2,463 | | | | 2,498 | |
| Data processing fees | | | 1,394 | | | | 1,593 | | | | 1,544 | | | | 1,323 | | | | 1,459 | |
| Professional fees and services | | | 5,299 | | | | 4,856 | | | | 5,385 | | | | 3,725 | | | | 3,605 | |
| Amortization of intangibles | | | 842 | | | | 936 | | | | 937 | | | | 936 | | | | 937 | |
| Marketing | | | 946 | | | | 902 | | | | 943 | | | | 983 | | | | 939 | |
| Insurance | | | 2,333 | | | | 2,198 | | | | 2,376 | | | | 2,254 | | | | 5,840 | |
| Communication | | | 1,647 | | | | 1,769 | | | | 1,720 | | | | 1,652 | | | | 1,619 | |
| State taxes | | | 838 | | | | 845 | | | | 424 | | | | 892 | | | | 949 | |
| Other | | | 4,332 | | | | 3,871 | | | | 3,381 | | | | 3,463 | | | | 4,089 | |
| Total other expense | | $ | 47,001 | | | $ | 47,890 | | | $ | 46,660 | | | $ | 46,052 | | | $ | 50,151 | |
PARK NATIONAL CORPORATION
Asset Quality Information
| | | Quarter ended | | | Year ended December 31, | |
| (in thousands, except ratios) | | June 30, 2010 | | | March 31, 2010 | | | 2009 | | | 2008 | | | 2007 | | | 2006 | |
| | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses: | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses, beginning of period | | $ | 119,674 | | | $ | 116,717 | | | $ | 100,088 | | | $ | 87,102 | | | $ | 70,500 | | | $ | 69,694 | |
| Charge-offs | | | 13,273 | | | | 15,578 | | | | 59,022 | | | | 62,916 | | | | 27,776 | | | | 10,772 | |
| Recoveries | | | 1,025 | | | | 1,985 | | | | 6,830 | | | | 5,415 | | | | 5,568 | | | | 6,853 | |
| Net charge-offs | | | 12,248 | | | | 13,593 | | | | 52,192 | | | | 57,501 | | | | 22,208 | | | | 3,919 | |
| Provision for loan losses | | | 13,250 | | | | 16,550 | | | | 68,821 | | | | 70,487 | | | | 29,476 | | | | 3,927 | |
| Allowance for loan losses of acquired bank | | | - | | | | - | | | | - | | | | - | | | | 9,334 | | | | 798 | |
| Allowance for loan losses, end of period | | $ | 120,676 | | | $ | 119,674 | | | $ | 116,717 | | | $ | 100,088 | | | $ | 87,102 | | | $ | 70,500 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Asset Quality Ratios: | | | | | | | | | | | | | | | | | | | | | | | | |
| Net charge-offs as a % of average loans (annualized for quarterly periods) | | | 1.07 | % | | | 1.19 | % | | | 1.14 | % | | | 1.32 | % | | | 0.55 | % | | | 0.12 | % |
| Allowance for loan losses as a % of period end loans | | | 2.59 | % | | | 2.60 | % | | | 2.52 | % | | | 2.23 | % | | | 2.06 | % | | | 2.03 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Nonperforming Assets: | | | | | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans | | $ | 237,640 | | | $ | 230,498 | | | $ | 233,544 | | | $ | 159,512 | | | $ | 101,128 | | | $ | 16,004 | |
| Renegotiated loans | | | 214 | | | | 60 | | | | 142 | | | | 2,845 | | | | 2,804 | | | | 9,113 | |
| Loans past due 90 days or more | | | 17,283 | | | | 11,853 | | | | 14,773 | | | | 5,421 | | | | 4,545 | | | | 7,832 | |
| Total nonperforming loans | | $ | 255,137 | | | $ | 242,411 | | | $ | 248,459 | | | $ | 167,778 | | | $ | 108,477 | | | $ | 32,949 | |
| Other real estate owned | | | 46,456 | | | | 45,854 | | | | 41,240 | | | | 25,848 | | | | 13,443 | | | | 3,351 | |
| Total nonperforming assets | | $ | 301,593 | | | $ | 288,265 | | | $ | 289,699 | | | $ | 193,626 | | | $ | 121,920 | | | $ | 36,300 | |
| Percentage of nonperforming loans to period end loans | | | 5.48 | % | | | 5.27 | % | | | 5.35 | % | | | 3.74 | % | | | 2.57 | % | | | 0.95 | % |
| Percentage of nonperforming assets to period end loans | | | 6.48 | % | | | 6.27 | % | | | 6.24 | % | | | 4.31 | % | | | 2.89 | % | | | 1.04 | % |
| Percentage of nonperforming assets to period end assets | | | 4.25 | % | | | 4.02 | % | | | 4.11 | % | | | 2.74 | % | | | 1.88 | % | | | 0.66 | % |
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| New nonaccrual loan information: | | | | | | | | | | | | | | | | | | | | | | | | |
| Nonaccrual loans, beginning of period | | $ | 230,498 | | | $ | 233,544 | | | $ | 159,512 | | | $ | 101,128 | | | $ | 16,004 | | | $ | 14,922 | |
| New nonaccrual loans | | | 30,870 | | | | 30,252 | | | | 184,181 | | | | 141,749 | | | | 113,720 | | | | 4,949 | |
| Resolved nonaccrual loans | | | 23,728 | | | | 33,298 | | | | 110,149 | | | | 83,365 | | | | 28,596 | | | | 3,867 | |
| Nonaccrual loans, end of period | | $ | 237,640 | | | $ | 230,498 | | | $ | 233,544 | | | $ | 159,512 | | | $ | 101,128 | | | $ | 16,004 | |
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| Impaired Commercial Loan Portfolio Information (period end): | | | | | | | | | | | | | | | | | | | | | | | | |
| Unpaid principal balance | | $ | 250,305 | | | $ | 244,822 | | | $ | 245,092 | | | $ | 171,310 | | | $ | 100,307 | | | $ | 21,926 | |
| Prior charge-offs | | | 46,731 | | | | 46,175 | | | | 43,949 | | | | 29,967 | | | | 10,226 | | | | 2,446 | |
| Remaining principal balance | | | 203,574 | | | | 198,647 | | | | 201,143 | | | | 141,343 | | | | 90,081 | | | | 19,480 | |
| Specific reserves | | | 38,767 | | | | 38,739 | | | | 36,721 | | | | 8,875 | | | | 3,492 | | | | 2,002 | |
| Book value, after specific reserve | | $ | 164,807 | | | $ | 159,908 | | | $ | 164,422 | | | $ | 132,468 | | | $ | 86,589 | | | $ | 17,478 | |
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| Vision Bank Commercial Land & Development (CL&D) Loan Portfolio Information: | | | | | | | | | | | | | | | | | | | | | | | | |
| CL&D loans, period end | | $ | 192,051 | | | $ | 200,112 | | | $ | 218,205 | | | $ | 251,443 | | | $ | 295,743 | | | | | |
| Performing CL&D loans, period end | | | 97,562 | | | | 116,672 | | | | 132,788 | | | | 191,712 | | | | 260,195 | | | | | |
| Impaired CL&D loans, period end | | | 94,489 | | | | 83,440 | | | | 85,417 | | | | 59,731 | | | | 35,548 | | | | | |
| Specific reserve on impaired CL&D loans | | | 25,006 | | | | 24,404 | | | | 21,706 | | | | 3,134 | | | | 1,184 | | | | | |
| Book value of impaired CL&D loans, after specific reserve | | $ | 69,483 | | | $ | 59,036 | | | $ | 63,711 | | | $ | 56,597 | | | $ | 34,364 | | | | | |
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| Cumulative prior charge-offs on impaired Vision Bank CL&D loans, period end | | $ | 23,973 | | | $ | 26,334 | | | $ | 24,931 | | | $ | 18,839 | | | $ | 7,399 | | | | | |
