Exhibit 99
Provident Financial Group Announces Its
Financial Results for the Third Quarter of 2003
15% Earnings Growth and Improved Credit Performance
CINCINNATI, Oct. 15 /PRNewswire-FirstCall/ -- Provident Financial Group,
Inc. (Nasdaq: PFGI) announced today its financial results for the third
quarter of 2003. The company reported a 15 percent increase in earnings per
share over last year's third quarter. Earnings per share and net income for
the third quarter ended on September 30, 2003, were 54 cents and
$27.5 million, compared with 26 cents and $13.2 million last quarter, and
47 cents and $24.0 million in 2002's third quarter. Third quarter 2003 returns
on average equity and assets were 12.91 percent and 0.62 percent, compared
with 5.85 percent and 0.30 percent last quarter, and 11.33 percent and
0.59 percent in 2002's third quarter.
Robert L. Hoverson, Provident's President and Chief Executive Officer,
commented, "We continue to see significant improvement in the credit
performance in our commercial loan and lease portfolios. Non-performing assets
declined by $15 million and net charge-offs were 57 basis points -- their
lowest level since the second quarter of 2000. Additionally, our loss coverage
ratios have reached their highest levels since the third quarter of 2001.
Other positive developments this quarter included a 10 percent increase in
commercial and retail deposits, and strong growth in our prime home equity
lending and middle-market equipment leasing businesses. At the same time, we
are experiencing delays in reaching projected production levels in our
mortgage whole-loan sale business, which impacted earnings this quarter."
Hoverson continued, "We are fast becoming a company with very solid
fundamental credit performance and a business strategy that is based on
continued steady earnings growth. With a strong commitment to customer service
from all of our associates, our businesses will produce the results to
maximize shareholder value. We expect a solid finish to this year and
continued earnings momentum into 2004."
Loans & Asset Quality
Average loans for 2003's third quarter were $9.0 billion compared with
$8.7 billion in last year's third quarter. Total loans outstanding on
September 30, 2003 were $9.0 billion compared with $9.0 billion on
September 30, 2002.
Key asset quality indicators:
- The third quarter 2003 provision for loan and lease losses was
$11.9 million, compared with $52.5 million last quarter, and
$23.5 million for 2002's third quarter. Excluding the impact from the
sale of the subprime residential mortgage loans, last quarter's
provision for loan and lease losses was $19.2 million.
- The third quarter 2003 annualized net charge-offs to average total
loans and leases was 0.57 percent, compared with 2.98 percent last
quarter, and 1.55 percent for 2002's third quarter. Excluding credit
costs related to the sale of the subprime residential mortgage loans,
last quarter's net charge-offs were 0.84 percent, or $19.2 million.
- The reserve for loan and lease losses on September 30, 2003 was
$184.2 million compared with $185.0 million on June 30, 2003, and
$204.8 million on September 30, 2002. The reserve for loan and lease
losses on September 30, 2003 was 2.04 percent of total loans and leases
compared with 2.09 percent on June 30, 2003 and 2.28 percent on
September 30, 2002. The reserve for loan and lease losses on
September 30, 2003 was 140 percent of non-performing assets compared
with 126 percent on June 30, 2003 and 106 percent on
September 30, 2002.
- Non-performing assets were $132.0 million on September 30, 2003
compared with $147.2 million on June 30, 2003 and $193.5 million on
September 30, 2002. Non-performing assets were 1.46 percent of total
loans, leases and other non-performing assets on September 30, 2003
compared with 1.66 percent on June 30, 2003 and 2.15 percent on
September 30, 2002.
Revenue & Expenses
Third quarter 2003 net interest income was $74.1 million compared with
$77.6 million in last year's third quarter. The net interest margin was
2.01 percent compared with 2.32 percent last quarter and 2.37 percent in last
year's third quarter. This quarter's net interest income and net interest
margin were both negatively impacted by last quarter's sale of $471.0 million
of subprime residential mortgage loans; however, this was partially offset by
a reduction in provision expense due to a lower level of charge-offs
recognized this quarter. Non-interest income was $186.3 million compared with
$198.4 million in last year's third quarter. Revenue, comprised of net
interest income and non-interest income was $260.4 million compared with
$276.0 million in last year's third quarter. Third quarter 2003 non-interest
expenses were $208.1 million compared with $216.1 million in last year's third
quarter and $226.1 million last quarter. Impacting revenue was a decline of
$23.1 million in operating lease income, which was accompanied by a
$16.6 million decrease in operating lease expense.
During the quarter, the company recognized a $4.1 million impairment
charge on its mortgage servicing rights related to third-party loans. This
valuation charge, reported in non-interest income, resulted from higher than
projected prepayment speeds, and was offset by $5.1 million in investment
securities gains that were also recognized during the quarter.
Deposits
Average retail and commercial deposits for 2003's third quarter were
$7.0 billion, an increase of 10 percent from $6.4 billion in 2002's third
quarter. For the period ended September 30, 2003, retail and commercial
deposits were $7.1 billion, an increase of 10 percent from $6.5 billion on
September 30, 2002.
Outlook
Based on the current economic environment, the company expects improvement
in business volumes for the fourth quarter. Excluding the expected pre-tax
gain of approximately $70.0 million or 93 cents per share from the sale of the
Florida branches, which is now expected to close on November 21, fourth
quarter 2003 earnings per share should be up over last year's fourth quarter
of 52 cents by a low, double-digit growth rate. Current expectations for full-
year 2004 earnings per share are within a mid double-digit growth rate range.
The credit trends are expected to continue to improve, with non-performing
assets declining in the fourth quarter and throughout next year. Charge-offs
are also expected to continue to decline in 2004. Additionally, the company is
taking aggressive actions to better manage expenses. During the past two
months an extensive review of key expense drivers was performed and some
actions have already been implemented to reduce expenses. Management is
confident that profitability will be improved by managing expense levels more
effectively.
Capital Position
Common shareholders' equity was $885.4 million or $18.11 per share on
September 30, 2003 compared with $883.6 million or $18.11 per share on
June 30, 2003. On September 30, 2003 common equity to assets was 5.03 percent
and Tier I and total risk-based capital ratios were 9.98 percent and
11.86 percent respectively.
Year-To-Date Results
For the nine months ended September 30, 2003, earnings per share and net
income were $1.31 and $66.5 million, compared with $1.36 and $68.8 million for
the nine months ended September 30, 2002. Returns on average equity and assets
were 10.10 percent and 0.50 percent, compared with 10.90 percent and
0.56 percent for the nine months ended September 30, 2002. Revenue was
$835.8 million compared with $835.9 million, and the net interest margin was
2.23 percent compared with 2.43 percent. Excluding the sales of the subprime
mortgage loan portfolio and the Merchant Services business last quarter, year-
to-date earnings per share were $1.59, net income was $80.6 million, and
returns on average equity and assets were 12.26 percent and 0.61 percent.
Conference Call & Webcast
A conference call and webcast will be held today at 2:00 p.m. (ET). The
live call can be accessed by calling 1-877-818-4511. A Replay of the call will
be available from 4:00 p.m. today through Monday, October 20, 2003 at
11:59 p.m. by calling 1-800-642-1687 (passcode 299 27 45). The webcast will be
available for replay immediately after the call. Both the live and archived
webcast can be accessed from the Investor Relations area of Provident's
website at http://www.providentbank.com .
Forward-Looking Statements
This document contains certain forward-looking statements that are subject
to numerous assumptions, risks or uncertainties. The Private Securities
Litigation Reform Act of 1995 provides a safe harbor for forward-looking
statements. Forward-looking statements may be identified by words such as
estimates, anticipates, projects, plans, expects, intends, believes, should
and similar expressions and by the context in which they are used. Such
statements are based upon current expectations of the company and speak only
as of the date made. Actual results could differ materially from those
contained in or implied by such forward-looking statements for a variety of
factors including: sharp and/or rapid changes in interest rates; significant
changes in the anticipated economic scenario which could materially change
anticipated credit quality trends; the ability to generate loans and leases;
significant cost, delay in, or ability to execute strategic initiatives
designed to grow revenues and/or manage expenses; consummation of significant
business combinations or divestitures; and significant changes in accounting,
tax, or regulatory practices or requirements and factors noted in connection
with forward-looking statements. Additionally, borrowers could suffer
unanticipated losses without regard to general economic conditions. The
results of these and other factors could cause differences from expectations
in the level of defaults, changes in the risk characteristics of the loan and
lease portfolio, and changes in the provision for loan and lease losses.
Provident undertakes no obligations to update any forward-looking statements
to reflect events or circumstances arising after the date on which they are
made.
About Provident Financial Group, Inc.
Provident Financial Group, Inc. is a bank holding company located in
Cincinnati, Ohio. Its main subsidiary, The Provident Bank, provides a diverse
line of banking and financial products, services and solutions through retail
banking offices located in Southwestern Ohio, Northern Kentucky and the West
Coast of Florida, and through commercial lending offices located throughout
Ohio and surrounding states. Customers have access to banking services 24-
hours a day through Provident's extensive network of ATMs, Telebank, a
telephone customer service center, and the Internet at www.providentbank.com .
At September 30, 2003, Provident Financial Group had $9.0 billion in loans
outstanding, $10.8 billion in deposits, and assets of $17.6 billion. Provident
has served the financial needs of its customers for 100 years, and currently
3,400 Provident associates serve approximately 500,000 customers. Provident
Financial Group's common stock trades on the Nasdaq Stock Market under the
symbol PFGI.
For further information, please contact:
Christopher J. Carey
Executive Vice President & Chief Financial Officer
1-513-639-4644 / 1-800-851-9521
e-mail: IR@provident-financial.com
Provident Financial Group, Inc. and Subsidiaries
Consolidated Financial Highlights
(unaudited)
Three Months Nine Months
For The Period Ended
September 30 2003 2002 % Change 2003 2002 % Change
PER COMMON SHARE:
Net Income
Basic $.56 $.49 14.3% $1.35 $1.39 (2.9)%
Diluted $.54 $.47 14.9% 1.31 1.36 (3.7)%
Dividends $.24 $.24 0.0% .72 .72 0.0%
Book Value 18.11 17.45 3.8%
RESULTS OF OPERATIONS:
(In Millions)
Net Interest Income $74.1 $77.6 (4.5)% $241.6 $234.6 3.0%
Provision for Loan
and Lease Losses 11.9 23.5 (49.3)% 80.9 81.3 (0.5)%
Net Income 27.5 24.0 14.2% 66.5 68.8 (3.4)%
FINANCIAL RATIOS:
Performance Ratios:
Return on
Average Assets 0.62% 0.59% 0.50% 0.56%
Return on
Average
Shareholders'
Equity 12.91 11.33 10.10 10.90
Average
Shareholders'
Equity to
Average Assets 4.81 5.19 4.96 5.15
Net Interest
Margin 2.01 2.37 2.23 2.43
Capital Adequacy
Ratios (Period
End):
Shareholders'
Equity to Total
Assets 5.07 5.00
Tier I Leverage
Ratio 7.84 8.09
Risk-Based
Capital Ratio -
Tier I Capital 9.98 9.81
Risk-Based
Capital Ratio -
Total Capital 11.86 11.91
(Current
Period
Regulatory
Ratios are
Estimated)
ASSET QUALITY RATIOS:
Reserve for Loan and
Lease Losses to:
Total Loans and
Leases 2.04% 2.28%
Nonaccrual Loans 148.87 114.46
Nonperforming Assets
to:
Total Loans,
Leases and Other
Nonperforming
Assets 1.46 2.15
Total Assets .75 1.13
Net Charge-Off's to
Average Total
Loans and Leases
(Annualized) .57% 1.55% 1.44 1.81
AVERAGE BALANCES: (In
Millions)
Total Loans and
Leases $8,965 $8,688 3.2% $9,076 $8,688 4.5%
Earning Assets 14,662 12,986 12.9% 14,484 12,924 12.1%
Leased Equipment 1,918 2,429 (21.0)% 2,088 2,516 (17.0)%
Assets 17,677 16,363 8.0% 17,695 16,343 8.3%
Deposits 10,907 9,340 16.8% 10,647 9,169 16.1%
Interest Bearing
Liabilities 14,961 13,993 6.9% 15,025 14,089 6.6%
Shareholders' Equity 851 849 0.2% 877 842 4.2%
PERIOD END BALANCES: (In
Millions)
Total Loans and
Leases $9,011 $8,999 0.1%
Leased Equipment 1,826 2,398 (23.9)%
Assets 17,608 17,097 3.0%
Deposits 10,772 9,273 16.2%
Shareholders' Equity 892 855 4.3%
OFF-BALANCE SHEET
SECURITIZED LOANS AND
LEASES: (In Millions)
Residential Mortgage $1,318 $1,973 (33.2)%
Home Equity 144 220 (34.5)%
Direct Finance
Leasing 52 114 (54.4)%
Total Off-Balance
Sheet Securitized
Loans and Leases $1,514 $2,307 (34.4)%
(See Asset Securitization Sales Note to Consolidated Financial Statements
within the Company's Form 10-K for further discussion of these off-balance
sheet assets.)
Provident Financial Group, Inc. and Subsidiaries
Consolidated Statements Of Income
(unaudited)
Three Months Ended
September 30,
(Dollars In Thousands Except Per
Share Data) 2003 2002 % Change
Net Interest Income $74,123 $77,626 (4.5)%
Provision for Loan and Lease Losses 11,919 23,532 (49.3)%
Noninterest Income:
Service Charges on Deposit Accounts 12,933 11,681 10.7%
Loan Servicing Fees 6,925 9,018 (23.2)%
Commercial Mortgage Banking Revenue 10,095 5,365 88.2%
Other Service Charges and Fees 13,520 10,744 25.8%
Leasing Income 127,011 150,135 (15.4)%
Cash Gain on Sale of Loans 4,553 5,001 (9.0)%
Warrant Gains - - n/m
Net Securities Gains / (Losses) 5,077 633 n/m
Net Gain on Merchant Services
Business - - n/m
Other 6,176 5,820 6.1%
Total Noninterest Income 186,290 198,397 (6.1)%
Noninterest Expense:
Salaries, Wages and Benefits 60,737 57,141 6.3%
Charges and Fees 7,404 7,029 5.3%
Occupancy 6,224 5,861 6.2%
Leasing Expense 86,077 102,690 (16.2)%
Equipment Expense 6,398 5,680 12.6%
Professional Services 7,906 6,007 31.6%
Minority Interest Expense 3,197 3,223 (0.8)%
Disposition Cost of Subprime Loans - - n/m
Other 30,167 28,448 6.0%
Total Noninterest Expense 208,110 216,079 (3.7)%
Income Before Income Taxes 40,384 36,412 10.9%
Applicable Income Taxes 12,923 12,376 4.4%
Net Income $27,461 $24,036 14.2%
Other Data:
Earnings Per Common Share - Basic $0.56 $0.49 14.3%
Earnings Per Common Share - Diluted $0.54 $0.47 14.9%
Dividends Paid Per Common Share $0.24 $0.24 0.0%
Return on Assets 0.62% 0.59%
Return on Equity 12.91% 11.33%
Net Interest Margin (FTE) 2.01% 2.37%
Full-Time Equivalent Employees 3,345 3,214
n/m - not meaningful
Provident Financial Group, Inc. and Subsidiaries
Consolidated Statements Of Income
(unaudited)
Nine Months Ended
September 30,
(Dollars In Thousands Except Per
Share Data) 2003 2002 % Change
Net Interest Income $241,576 $234,649 3.0%
Provision for Loan and Lease Losses 80,909 81,312 (0.5)%
Noninterest Income:
Service Charges on Deposit Accounts 37,656 33,045 14.0%
Loan Servicing Fees 27,013 25,430 6.2%
Commercial Mortgage Banking Revenue 31,241 17,132 82.4%
Other Service Charges and Fees 38,177 32,664 16.9%
Leasing Income 398,110 457,780 (13.0)%
Cash Gain on Sale of Loans 16,619 12,135 37.0%
Warrant Gains 1,636 8,186 (80.0)%
Net Securities Gains / (Losses) 7,435 1,287 n/m
Net Gain on Merchant Services
Business 19,000 - n/m
Other 17,330 13,546 27.9%
Total Noninterest Income 594,217 601,205 (1.2)%
Noninterest Expense:
Salaries, Wages and Benefits 188,544 172,260 9.5%
Charges and Fees 23,093 22,779 1.4%
Occupancy 18,916 17,829 6.1%
Leasing Expense 272,587 314,092 (13.2)%
Equipment Expense 20,171 17,862 12.9%
Professional Services 24,722 18,311 35.0%
Minority Interest Expense 9,591 3,889 146.6%
Disposition Cost of Subprime Loans 6,914 - n/m
Other 91,728 82,306 11.4%
Total Noninterest Expense 656,266 649,328 1.1%
Income Before Income Taxes 98,618 105,214 (6.3)%
Applicable Income Taxes 32,140 36,392 (11.7)%
Net Income $66,478 $68,822 (3.4)%
Other Data:
Earnings Per Common Share - Basic $1.35 $1.39 (2.9)%
Earnings Per Common Share - Diluted $1.31 $1.36 (3.7)%
Dividends Paid Per Common Share $0.72 $0.72 0.0%
Return on Assets 0.50% 0.56%
Return on Equity 10.10% 10.90%
Net Interest Margin (FTE) 2.23% 2.43%
Full-Time Equivalent Employees
n/m - not meaningful
Provident Financial Group, Inc. and Subsidiaries
Consolidated Quarterly Statements Of Income
(unaudited)
2003
(Dollars In Thousands Except Per Third Second First Year to
Share Data) Quarter Quarter Quarter Date
Net Interest Income $74,123 $84,494 $82,959 $241,576
Provision for Loan and Lease Losses 11,919 52,469 16,521 80,909
Noninterest Income:
Service Charges on Deposit
Accounts 12,933 12,391 12,332 37,656
Loan Servicing Fees 6,925 9,428 10,660 27,013
Commercial Mortgage Banking
Revenue 10,095 10,849 10,297 31,241
Other Service Charges and Fees 13,520 12,921 11,736 38,177
Leasing Income 127,011 132,238 138,861 398,110
Cash Gain on Sale of Loans 4,553 7,124 4,942 16,619
Warrant Gains - 1,308 328 1,636
Net Securities Gains / (Losses) 5,077 858 1,500 7,435
Net Gain on Merchant Services
Business - 19,000 - 19,000
Other 6,176 7,636 3,518 17,330
Total Noninterest Income 186,290 213,753 194,174 594,217
Noninterest Expense:
Salaries, Wages and Benefits 60,737 65,823 61,984 188,544
Charges and Fees 7,404 7,867 7,822 23,093
Occupancy 6,224 6,464 6,228 18,916
Leasing Expense 86,077 90,750 95,760 272,587
Equipment Expense 6,398 6,824 6,949 20,171
Professional Services 7,906 8,418 8,398 24,722
Minority Interest Expense 3,197 3,197 3,197 9,591
Disposition Cost of Subprime Loans - 6,914 - 6,914
Other 30,167 29,816 31,745 91,728
Total Noninterest Expense 208,110 226,073 222,083 656,266
Income Before Income Taxes 40,384 19,705 38,529 98,618
Applicable Income Taxes 12,923 6,502 12,715 32,140
Net Income $27,461 $13,203 $25,814 $66,478
Other Data:
Earnings Per Common Share - Basic $0.56 $0.27 $0.52 $1.35
Earnings Per Common Share -
Diluted $0.54 $0.26 $0.51 $1.31
Dividends Paid Per Common Share $0.24 $0.24 $0.24 $0.72
Return on Assets 0.62% 0.30% 0.59% 0.50%
Return on Equity 12.91% 5.85% 11.76% 10.10%
Net Interest Margin (FTE) 2.01% 2.32% 2.37% 2.23%
Full-Time Equivalent Employees 3,345 3,355 3,333
Provident Financial Group, Inc. and Subsidiaries
Consolidated Quarterly Statements Of Income
(unaudited)
2002
(Dollars In Thousands Fourth Third Second First Full
Except Per Share Data) Quarter Quarter Quarter Quarter Year
Net Interest Income $80,909 $77,626 $78,728 $78,295 $315,558
Provision for Loan and Lease
Losses 18,237 23,532 33,575 24,205 99,549
Noninterest Income:
Service Charges on Deposit
Accounts 12,139 11,681 10,915 10,449 45,184
Loan Servicing Fees 11,550 9,018 8,414 7,998 36,980
Commercial Mortgage
Banking Revenue 8,222 5,365 6,021 5,746 25,354
Other Service Charges and
Fees 12,754 10,744 12,021 9,899 45,418
Leasing Income 148,107 150,135 152,664 154,981 605,887
Cash Gain on Sale of Loans 3,556 5,001 4,494 2,640 15,691
Warrant Gains - - 8,186 - 8,186
Net Securities Gains /
(Losses) 1,309 633 654 - 2,596
Other 6,650 5,820 3,209 4,517 20,196
Total Noninterest
Income 204,287 198,397 206,578 196,230 805,492
Noninterest Expense:
Salaries, Wages and
Benefits 60,918 57,141 58,730 56,389 233,178
Charges and Fees 7,752 7,029 8,099 7,651 30,531
Occupancy 5,808 5,861 5,950 6,018 23,637
Leasing Expense 102,416 102,690 104,537 106,865 416,508
Equipment Expense 6,483 5,680 5,975 6,207 24,345
Professional Services 7,679 6,007 6,219 6,085 25,990
Minority Interest Expense 3,180 3,223 666 - 7,069
Other 32,464 28,448 26,461 27,397 114,770
Total Noninterest
Expense 226,700 216,079 216,637 216,612 876,028
Income Before Income
Taxes 40,259 36,412 35,094 33,708 145,473
Applicable Income Taxes 13,630 12,376 11,924 12,092 50,022
Net Income $26,629 $24,036 $23,170 $21,616 $95,451
Other Data:
Earnings Per Common Share
- Basic $0.54 $0.49 $0.47 $0.43 $1.94
Earnings Per Common Share
- Diluted $0.52 $0.47 $0.46 $0.43 $1.88
Dividends Paid Per Common
Share $0.24 $0.24 $0.24 $0.24 $0.96
Return on Assets 0.62% 0.59% 0.57% 0.53% 0.58%
Return on Equity 12.38% 11.33% 10.91% 10.45% 11.27%
Net Interest Margin (FTE) 2.36% 2.37% 2.45% 2.47% 2.41%
Full-Time Equivalent
Employees 3,307 3,214 3,240 3,204
Provident Financial Group, Inc. and Subsidiaries
Consolidated Period End Balance Sheets
(unaudited)
2003
Third Second First
(In Thousands) Quarter Quarter Quarter
ASSETS
Cash and Due From Banks $288,176 $352,241 $340,141
Federal Funds Sold and
Reverse Repurchase Agreements 341,833 337,006 561,446
Trading Account Securities 142,660 105,877 111,516
Loans and Leases Held For Sale 494,804 447,039 255,593
Investment Securities 4,731,323 4,760,894 4,320,723
Loans and Leases:
Corporate Lending:
Commercial 4,288,451 4,459,612 4,515,888
Mortgage 992,619 1,017,061 947,205
Construction 504,071 516,348 528,824
Lease Financing 1,304,659 1,253,851 1,233,533
Total Corporate
Lending 7,089,800 7,246,872 7,225,450
Consumer Lending:
Installment 1,573,782 1,424,207 1,362,896
Residential 26,812 37,741 519,632
Lease Financing 320,866 155,577 43,522
Total Consumer
Lending 1,921,460 1,617,525 1,926,050
Total Loans and Leases 9,011,260 8,864,397 9,151,500
Reserve for Loan and Lease
Losses (184,160) (185,019) (201,020)
Net Loans and Leases 8,827,100 8,679,378 8,950,480
Leased Equipment 1,825,721 2,006,999 2,181,823
Premises and Equipment 99,561 97,070 98,853
Goodwill 84,269 83,979 82,651
Other Assets 772,186 923,516 823,194
$17,607,633 $17,793,999 $17,726,420
LIABILITIES AND
SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Noninterest Bearing $1,412,183 $1,357,468 $1,163,209
Interest Bearing 9,359,919 9,598,344 9,502,086
Total Deposits 10,772,102 10,955,812 10,665,295
Short-Term Debt 1,403,012 1,268,198 1,506,797
Long-Term Debt 3,476,460 3,624,262 3,661,219
Guaranteed Preferred Beneficial
Interests in Company's Junior
Subordinated Debentures 451,389 451,284 451,179
Minority Interest 160,966 160,966 160,966
Accrued Interest and Other
Liabilities 451,294 442,883 401,981
Total Liabilities 16,715,223 16,903,405 16,847,437
Shareholders' Equity:
Preferred Stock 7,000 7,000 7,000
Common Stock 14,492 14,461 14,454
Capital Surplus 301,737 298,838 298,498
Retained Earnings 634,018 618,712 619,444
Accumulated Other
Comprehensive Income (64,837) (48,417) (60,413)
Total Shareholders' Equity 892,410 890,594 878,983
$17,607,633 $17,793,999 $17,726,420
Provident Financial Group, Inc. and Subsidiaries
Consolidated Period End Balance Sheets
(unaudited)
2002
Fourth Third Second First
(In Thousands) Quarter Quarter Quarter Quarter
ASSETS
Cash and Due From
Banks $351,994 $327,467 $244,147 $227,137
Federal Funds Sold
and Reverse
Repurchase
Agreements 188,925 119,464 56,337 96,313
Trading Account
Securities 127,848 204,202 81,739 100,002
Loans and Leases
Held For Sale 436,884 189,581 328,453 125,421
Investment
Securities 4,215,238 4,138,464 3,815,609 3,897,222
Loans and Leases:
Corporate Lending:
Commercial 4,482,373 4,418,133 4,289,690 4,321,443
Mortgage 960,636 973,833 873,726 862,514
Construction 510,331 510,410 575,655 563,425
Lease
Financing 1,273,901 1,255,574 1,242,558 1,143,657
Total
Corporate
Lending 7,227,241 7,157,950 6,981,629 6,891,039
Consumer Lending:
Installment 1,306,761 1,164,509 1,008,386 911,151
Residential 599,793 676,971 750,045 848,676
Lease
Financing - - - -
Total
Consumer
Lending 1,906,554 1,841,480 1,758,431 1,759,827
Total Loans and
Leases 9,133,795 8,999,430 8,740,060 8,650,866
Reserve for Loan
and Lease Losses (201,051) (204,809) (214,860) (243,019)
Net Loans
and Leases 8,932,744 8,794,621 8,525,200 8,407,847
Leased Equipment 2,350,356 2,397,967 2,479,125 2,559,580
Premises and
Equipment 101,513 101,003 101,230 101,794
Goodwill 82,651 82,651 82,432 82,432
Other Assets 751,856 741,695 861,061 707,543
$17,540,009 $17,097,115 $16,575,333 $16,305,291
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Liabilities:
Deposits:
Noninterest
Bearing $1,141,990 $988,508 $844,256 $849,694
Interest Bearing 8,706,989 8,284,737 8,548,319 8,056,706
Total Deposits 9,848,979 9,273,245 9,392,575 8,906,400
Short-Term Debt 1,925,005 1,886,715 1,314,980 1,668,360
Long-Term Debt 3,842,657 4,017,644 3,976,155 3,962,991
Guaranteed
Preferred
Beneficial
Interests in Company's
Junior Subordinated
Debentures 451,074 450,969 450,864 450,759
Minority Interest 160,966 163,337 161,213 -
Accrued Interest
and Other
Liabilities 430,957 449,889 434,465 490,767
Total
Liabilities 16,659,638 16,241,799 15,730,252 15,479,277
Shareholders' Equity:
Preferred Stock 7,000 7,000 7,000 7,000
Common Stock 14,454 14,409 14,427 14,603
Capital Surplus 298,025 298,731 298,898 322,836
Retained Earnings 604,013 589,533 577,579 566,481
Accumulated Other
Comprehensive
Income (43,121) (54,357) (52,823) (84,906)
Total
Shareholders'
Equity 880,371 855,316 845,081 826,014
$17,540,009 $17,097,115 $16,575,333 $16,305,291
Provident Financial Group, Inc. and Subsidiaries
Consolidated Credit Loss Experience
(unaudited)
2003
Third Second First Year to
(Dollars In Thousands) Quarter Quarter Quarter Date
Reserve for Loan and Lease Losses
At Beginning of Period $185,019 $201,020 $201,051 $201,051
Provision Charged to Expense 11,919 52,469 16,521 80,909
Net Charge-Offs:
Corporate Lending:
Commercial 7,726 11,147 8,093 26,966
Mortgage - 54 46 100
Construction (56) (241) 65 (232)
Lease Financing 3,946 1,714 3,294 8,954
Net Corporate Lending 11,616 12,674 11,498 35,788
Consumer Lending:
Installment 1,118 1,467 576 3,161
Residential 2 54,320 4,478 58,800
Lease Financing 42 9 - 51
Net Consumer Lending 1,162 55,796 5,054 62,012
Net Charge-Offs 12,778 68,470 16,552 97,800
Reserve for Loan and Lease Losses
At End of Period $184,160 $185,019 $201,020 $184,160
Net Charge-Offs to Average Total
Loans and Leases: (Annualized)
Corporate Lending:
Commercial 0.69% 0.99% 0.73% 0.80%
Mortgage -% 0.02% 0.02% 0.01%
Construction (0.04%) (0.18%) 0.05% (0.06%)
Lease Financing 1.27% 0.56% 1.06% 0.96%
Total Corporate Lending 0.65% 0.70% 0.64% 0.66%
Consumer Lending:
Residential 0.07% 44.70% 3.25% 22.53%
Installment 0.29% 0.42% 0.17% 0.30%
Lease Financing 0.07% 0.04% -% -%
Total Consumer Lending 0.26% 11.21% 1.04% 4.36%
Total Loans and Leases 0.57% 2.98% 0.73% 1.44%
Provident Financial Group, Inc. and Subsidiaries
Consolidated Credit Loss Experience
(unaudited)
2002
Fourth Third Second
(Dollars In Thousands) Quarter Quarter Quarter
Reserve for Loan and Lease Losses
At Beginning of Period $204,809 $214,860 $243,019
Provision Charged to Expense 18,237 23,532 33,575
Net Charge-Offs:
Corporate Lending:
Commercial 7,244 24,859 25,057
Mortgage - 22 -
Construction 150 379 -
Lease Financing 10,101 2,620 21,635
Net Corporate Lending 17,495 27,880 46,692
Consumer Lending:
Installment 753 850 782
Residential 3,747 4,853 14,260
Lease Financing - - -
Net Consumer Lending 4,500 5,703 15,042
Net Charge-Offs 21,995 33,583 61,734
Reserve for Loan and Lease Losses
At End of Period $201,051 $204,809 $214,860
Net Charge-Offs to Average Total
Loans and Leases: (Annualized)
Corporate Lending:
Commercial 0.66% 2.35% 2.37%
Mortgage -% 0.01% -%
Construction 0.11% 0.28% -%
Lease Financing 3.25% 0.85% 7.25%
Total Corporate Lending 0.98% 1.61% 2.72%
Consumer Lending:
Residential 2.46% 2.83% 7.21%
Installment 0.24% 0.31% 0.32%
Lease Financing -% -% -%
Total Consumer Lending 0.98% 1.29% 3.43%
Total Loans and Leases 0.98% 1.55% 2.87%
Provident Financial Group, Inc. and Subsidiaries
Consolidated Credit Loss Experience
(unaudited)
2002
First Full
(Dollars In Thousands) Quarter Year
Reserve for Loan and Lease Losses
At Beginning of Period $241,143 $241,143
Provision Charged to Expense 24,205 99,549
Net Charge-Offs:
Corporate Lending:
Commercial 13,937 71,097
Mortgage 24 46
Construction 300 829
Lease Financing 4,324 38,680
Net Corporate Lending 18,585 110,652
Consumer Lending:
Installment 727 3,112
Residential 3,017 25,877
Lease Financing - -
Net Consumer Lending 3,744 28,989
Net Charge-Offs 22,329 139,641
Reserve for Loan and Lease Losses
At End of Period $243,019 $201,051
Net Charge-Offs to Average Total
Loans and Leases: (Annualized)
Corporate Lending:
Commercial 1.27% 1.65%
Mortgage 0.01% 0.01%
Construction 0.21% 0.15%
Lease Financing 1.55% 3.23%
Total Corporate Lending 1.07% 1.59%
Consumer Lending:
Residential 1.39% 3.51%
Installment 0.31% 0.30%
Lease Financing -% -%
Total Consumer Lending 0.83% 1.62%
Total Loans and Leases 1.02% 1.59%
Provident Financial Group, Inc. and Subsidiaries
Consolidated Nonperforming Assets
(unaudited)
2003
Third Second First
(Dollars In Thousands) Quarter Quarter Quarter
Nonaccrual Loans:
Corporate Lending:
Commercial $109,022 $116,926 $123,912
Mortgage 5,330 6,307 7,298
Construction 3,617 3,792 1,321
Lease Financing 2,271 2,267 2,792
Total Corporate Lending 120,240 129,292 135,323
Consumer Lending:
Installment - - -
Residential 3,468 4,011 45,927
Lease Financing - - -
Total Consumer Lending 3,468 4,011 45,927
Total Nonaccrual Loans 123,708 133,303 181,250
Other Nonperforming Assets 8,251 13,858 22,172
Total Nonperforming Assets $131,959 $147,161 $203,422
Loans 90 Days Past Due Still Accruing $10,211 $5,971 $36,038
Reserve for Loan and Lease Losses as
a Percent of:
Nonaccrual Loans 148.87% 138.80% 110.91%
Nonperforming Assets 139.56% 125.73% 98.82%
Total Loans and Leases 2.04% 2.09% 2.20%
Nonaccrual Loans as a % of Total
Loans and Leases 1.37% 1.50% 1.98%
Nonperforming Assets as a Percent of:
Total Loans, Leases and Other
Nonperforming Assets 1.46% 1.66% 2.22%
Total Assets .75% .83% 1.15%
Provident Financial Group, Inc. and Subsidiaries
Consolidated Nonperforming Assets
(unaudited)
2002
Fourth Third Second First
(Dollars In Thousands) Quarter Quarter Quarter Quarter
Nonaccrual Loans:
Corporate Lending:
Commercial $99,805 $117,571 $108,330 $111,727
Mortgage 11,783 10,619 5,546 1,938
Construction 1,746 2,243 7,268 1,984
Lease Financing 4,008 3,952 3,497 5,223
Total Corporate Lending 117,342 134,385 124,641 120,872
Consumer Lending:
Installment - - - -
Residential 49,091 44,548 35,920 62,530
Lease Financing - - - -
Total Consumer Lending 49,091 44,548 35,920 62,530
Total Nonaccrual Loans 166,433 178,933 160,561 183,402
Other Nonperforming Assets 15,780 14,579 25,471 28,098
Total Nonperforming Assets $182,213 $193,512 $186,032 $211,500
Loans 90 Days Past Due Still
Accruing $29,918 $30,482 $29,186 $29,390
Reserve for Loan and Lease Losses
as a Percent of:
Nonaccrual Loans 120.80% 114.46% 133.82% 132.51%
Nonperforming Assets 110.34% 105.84% 115.50% 114.90%
Total Loans and Leases 2.20% 2.28% 2.46% 2.81%
Nonaccrual Loans as a % of Total
Loans and Leases 1.82% 1.99% 1.84% 2.12%
Nonperforming Assets as a Percent
of:
Total Loans, Leases and Other
Nonperforming Assets 1.99% 2.15% 2.12% 2.44%
Total Assets 1.04% 1.13% 1.12% 1.30%
Provident Financial Group, Inc. and Subsidiaries
Consolidated Average Balances and Rates
On a Fully Taxable Equivalent Basis
(unaudited)
2003
Third Quarter Second Quarter
Average Average Average Average
(Dollars In Millions) Balance Rate Balance Rate
Assets:
Loans and Leases:
Corporate Lending:
Commercial $4,461 5.71 % $4,518 5.73 %
Mortgage 980 5.32 909 5.59
Construction 512 4.45 539 4.34
Lease Financing 1,247 8.14 1,227 8.72
Total Corporate Lending 7,200 5.99 7,193 6.12
Consumer Lending:
Installment 1,519 4.36 1,407 4.78
Residential 12 13.46 486 10.17
Lease Financing 234 7.02 97 8.91
Total Consumer Lending 1,765 4.77 1,990 6.29
Total Loans and Leases 8,965 5.75 9,183 6.16
Investment Securities 4,702 3.63 4,471 4.32
Federal Funds Sold and Reverse
Repurchase Agreements 446 1.55 441 1.90
Other Short-Term Investments 549 5.85 498 5.70
Total Earning Assets 14,662 4.95 14,593 5.45
Cash and Due From Banks 306 310
Leased Equipment 1,918 2,101
Other Assets 791 868
Total Assets $17,677 $17,872
Liabilities and
Shareholders' Equity:
Deposits:
Demand Deposits $1,266 1.33 $1,204 1.51
Savings Deposits 1,553 1.71 1,460 1.80
Time Deposits 6,700 2.56 6,990 2.68
Total Deposits 9,519 2.26 9,654 2.40
Short-Term Debt:
Federal Funds Purchased and
Repurchase Agreements 1,168 2.32 1,129 2.37
Commercial Paper 250 1.14 265 1.24
Total Short-Term Debt 1,418 2.11 1,394 2.16
Long-Term Debt 3,573 4.72 3,638 4.85
Junior Subordinated Debentures 451 3.95 451 4.09
Total Interest Bearing Liabilities 14,961 2.88 15,137 3.01
Noninterest Bearing Deposits 1,388 1,264
Minority Interest 161 162
Other Liabilities 316 406
Shareholders' Equity 851 903
Total Liabilities and
Shareholders' Equity $17,677 $17,872
Net Interest Spread 2.07 % 2.44 %
Net Interest Margin 2.01 % 2.32 %
Provident Financial Group, Inc. and Subsidiaries
Consolidated Average Balances and Rates
On a Fully Taxable Equivalent Basis
(unaudited)
2003
First Quarter Full Year
Average Average Average Average
(Dollars In Millions) Balance Rate Balance Rate
Assets:
Loans and Leases:
Corporate Lending:
Commercial $4,446 5.66 % $4,475 5.70 %
Mortgage 934 5.83 941 5.58
Construction 522 4.19 524 4.32
Lease Financing 1,246 8.85 1,239 8.57
Total Corporate Lending 7,148 6.13 7,179 6.08
Consumer Lending:
Installment 1,352 5.12 1,427 4.73
Residential 552 11.68 348 11.00
Lease Financing 33 7.92 122 7.60
Total Consumer Lending 1,937 7.04 1,897 6.07
Total Loans and Leases 9,085 6.32 9,076 6.08
Investment Securities 4,292 4.90 4,490 4.26
Federal Funds Sold and Reverse
Repurchase Agreements 313 2.13 401 1.83
Other Short-Term Investments 504 5.35 517 5.64
Total Earning Assets 14,194 5.76 14,484 5.38
Cash and Due From Banks 311 309
Leased Equipment 2,242 2,088
Other Assets 787 814
Total Assets $17,534 $17,695
Liabilities and
Shareholders' Equity:
Deposits:
Demand Deposits $1,053 1.43 $1,175 1.42
Savings Deposits 1,419 1.76 1,478 1.76
Time Deposits 6,498 2.94 6,730 2.72
Total Deposits 8,970 2.57 9,383 2.40
Short-Term Debt:
Federal Funds Purchased and
Repurchase Agreements 1,488 2.11 1,261 2.25
Commercial Paper 300 1.47 271 1.29
Total Short-Term Debt 1,788 2.00 1,532 2.08
Long-Term Debt 3,769 5.20 3,659 4.92
Junior Subordinated Debentures 451 4.22 451 4.09
Total Interest Bearing Liabilities 14,978 3.22 15,025 3.04
Noninterest Bearing Deposits 1,137 1,264
Minority Interest 161 161
Other Liabilities 380 368
Shareholders' Equity 878 877
Total Liabilities and
Shareholders' Equity $17,534 $17,695
Net Interest Spread 2.54 % 2.34 %
Net Interest Margin 2.37 % 2.23 %
Provident Financial Group, Inc. and Subsidiaries
Consolidated Average Balances and Rates
On a Fully Taxable Equivalent Basis
(unaudited)
2002
Fourth Quarter Third Quarter
Average Average Average Average
(Dollars In Millions) Balance Rate Balance Rate
Assets:
Loans and Leases:
Corporate Lending:
Commercial $4,404 6.13 % $4,227 6.36 %
Mortgage 943 5.88 930 6.08
Construction 524 4.28 533 4.56
Lease Financing 1,245 8.65 1,233 9.06
Total Corporate Lending 7,116 6.40 6,923 6.67
Consumer Lending:
Installment 1,232 5.50 1,080 6.16
Residential 609 9.83 685 9.64
Lease Financing - - - -
Total Consumer Lending 1,841 6.94 1,765 7.51
Total Loans and Leases 8,957 6.51 8,688 6.84
Investment Securities 4,149 5.26 3,789 5.49
Federal Funds Sold and Reverse
Repurchase Agreements 161 2.59 102 2.66
Other Short-Term Investments 366 5.76 407 5.28
Total Earning Assets 13,633 6.07 12,986 6.36
Cash and Due From Banks 324 245
Leased Equipment 2,369 2,429
Other Assets 788 703
Total Assets $17,114 $16,363
Liabilities and
Shareholders' Equity:
Deposits:
Demand Deposits $944 1.60 $778 1.61
Savings Deposits 1,464 1.82 1,417 2.03
Time Deposits 5,960 3.43 6,211 3.49
Total Deposits 8,368 2.94 8,406 3.07
Short-Term Debt:
Federal Funds Purchased and
Repurchase Agreements 1,494 2.26 849 2.90
Commercial Paper 295 1.82 268 1.97
Total Short-Term Debt 1,789 2.19 1,117 2.68
Long-Term Debt 3,939 5.07 4,019 5.13
Junior Subordinated Debentures 451 4.56 451 5.28
Total Interest Bearing
Liabilities 14,547 3.48 13,993 3.70
Noninterest Bearing Deposits 1,113 934
Minority Interest 160 162
Other Liabilities 434 425
Shareholders' Equity 860 849
Total Liabilities and
Shareholders' Equity $17,114 $16,363
Net Interest Spread 2.59 % 2.66 %
Net Interest Margin 2.36 % 2.37 %
Provident Financial Group, Inc. and Subsidiaries
Consolidated Average Balances and Rates
On a Fully Taxable Equivalent Basis
(unaudited)
2002
Second Quarter First Quarter
Average Average Average Average
(Dollars In Millions) Balance Rate Balance Rate
Assets:
Loans and Leases:
Corporate Lending:
Commercial $4,231 6.33 % $4,386 6.55 %
Mortgage 878 6.42 882 6.54
Construction 560 4.38 567 4.82
Lease Financing 1,194 9.22 1,117 9.84
Total Corporate Lending 6,863 6.68 6,952 6.94
Consumer Lending:
Installment 965 6.41 937 6.99
Residential 791 9.60 869 9.30
Lease Financing - - - -
Total Consumer Lending 1,756 7.85 1,806 8.11
Total Loans and Leases 8,619 6.92 8,758 7.18
Investment Securities 3,866 5.90 3,721 5.82
Federal Funds Sold and Reverse
Repurchase Agreements 127 2.85 109 2.79
Other Short-Term Investments 299 6.55 285 6.15
Total Earning Assets 12,911 6.57 12,873 6.72
Cash and Due From Banks 212 238
Leased Equipment 2,505 2,606
Other Assets 678 644
Total Assets $16,306 $16,361
Liabilities and
Shareholders' Equity:
Deposits:
Demand Deposits $546 1.12 $512 1.01
Savings Deposits 1,475 1.97 1,535 2.05
Time Deposits 6,446 3.66 5,920 4.00
Total Deposits 8,467 3.20 7,967 3.43
Short-Term Debt:
Federal Funds Purchased and
Repurchase Agreements 906 2.90 1,481 2.47
Commercial Paper 284 1.93 273 1.92
Total Short-Term Debt 1,190 2.67 1,754 2.38
Long-Term Debt 3,974 5.14 4,022 5.18
Junior Subordinated Debentures 451 5.47 451 5.34
Total Interest Bearing
Liabilities 14,082 3.78 14,194 3.86
Noninterest Bearing Deposits 881 847
Minority Interest 34 -
Other Liabilities 460 493
Shareholders' Equity 849 827
Total Liabilities and
Shareholders' Equity $16,306 $16,361
Net Interest Spread 2.79 % 2.86 %
Net Interest Margin 2.45 % 2.47 %
Provident Financial Group, Inc. and Subsidiaries
Consolidated Average Balances and Rates
On a Fully Taxable Equivalent Basis
(unaudited)
2002
Full Year
Average Average
(Dollars In Millions) Balance Rate
Assets:
Loans and Leases:
Corporate Lending:
Commercial $4,312 6.34 %
Mortgage 909 6.22
Construction 546 4.51
Lease Financing 1,199 9.16
Total Corporate Lending 6,966 6.67
Consumer Lending:
Installment 1,054 6.21
Residential 737 9.59
Lease Financing - -
Total Consumer Lending 1,791 7.60
Total Loans and Leases 8,757 6.86
Investment Securities 3,882 5.61
Federal Funds Sold and Reverse
Repurchase Agreements 125 2.71
Other Short-Term Investments 341 5.85
Total Earning Assets 13,105 6.42
Cash and Due From Banks 255
Leased Equipment 2,477
Other Assets 701
Total Assets $16,538
Liabilities and
Shareholders' Equity:
Deposits:
Demand Deposits $696 1.40
Savings Deposits 1,472 1.97
Time Deposits 6,134 3.64
Total Deposits 8,302 3.16
Short-Term Debt:
Federal Funds Purchased and
Repurchase Agreements 1,182 2.56
Commercial Paper 280 1.91
Total Short-Term Debt 1,462 2.44
Long-Term Debt 3,990 5.13
Junior Subordinated Debentures 451 5.16
Total Interest Bearing
Liabilities 14,205 3.70
Noninterest Bearing Deposits 945
Minority Interest 90
Other Liabilities 451
Shareholders' Equity 847
Total Liabilities and
Shareholders' Equity $16,538
Net Interest Spread 2.72 %
Net Interest Margin 2.41 %
Provident Financial Group, Inc. and Subsidiaries
Consolidated Capital Data
(unaudited)
2003
Third Second First Year to
Quarter Quarter Quarter Date
Per Common Share:
Shares Outstanding (In Thousands):
Average - Basic 48,830 48,770 48,776 48,792
Average - Diluted 50,885 50,668 50,766 50,773
Period-End 48,885 48,783 48,759
Book Value $18.11 $18.11 $17.88
Price:
High $28.78 $26.45 $28.91 $28.91
Low 25.67 21.01 21.23 21.01
Period-End 27.97 25.75 21.23
Capital Ratios (Dollars in Millions):
Risk-Based Capital (Current Qtr
Estimated):
Risk-Adjusted Assets $13,852 $13,807 $13,886
Tier 1 Capital $1,382 $1,358 $1,359
Percentage of Risk Adjusted
Assets 9.98% 9.84% 9.78%
Total Capital $1,643 $1,625 $1,617
Percentage of Risk Adjusted Assets 11.86% 11.77% 11.65%
Tier 1 Leverage Ratio 7.84% 7.62% 7.76%
Period End Shareholders' Equity
to Total Period-End Assets 5.07% 5.01% 4.96%
Period-End Tangible Shareholders'
Equity
to Total Period-End Tangible Assets 4.56% 4.49% 4.45%
Average Shareholders' Equity
to Total Average Assets 4.81% 5.05% 5.01% 4.96%
Average Tangible Shareholders' Equity
to Total Average Tangible Assets 4.30% 4.54% 4.48% 4.44%
Provident Financial Group, Inc. and Subsidiaries
Consolidated Capital Data
(unaudited)
2002
Fourth Third Second
Quarter Quarter Quarter
Per Common Share:
Shares Outstanding (In Thousands):
Average - Basic 48,744 48,616 48,646
Average - Diluted 50,740 50,727 50,915
Period-End 48,760 48,611 48,672
Book Value $17.91 $17.45 $17.22
Price:
High $28.05 $29.51 $31.35
Low 21.48 24.28 24.42
Period-End 26.03 25.09 29.01
Capital Ratios (Dollars in Millions):
Risk-Based Capital (Current Qtr
Estimated):
Risk-Adjusted Assets $14,226 $13,467 $13,279
Tier 1 Capital $1,337 $1,321 $1,295
Percentage of Risk Adjusted
Assets 9.40% 9.81% 9.75%
Total Capital $1,625 $1,604 $1,582
Percentage of Risk Adjusted
Assets 11.42% 11.91% 11.91%
Tier 1 Leverage Ratio 7.81% 8.09% 7.96%
Period End Shareholders' Equity
to Total Period-End Assets 5.02% 5.00% 5.10%
Period-End Tangible Shareholders'
Equity
to Total Period-End Tangible Assets 4.49% 4.45% 4.53%
Average Shareholders' Equity
to Total Average Assets 5.03% 5.19% 5.21%
Average Tangible Shareholders' Equity
to Total Average Tangible Assets 4.48% 4.61% 4.62%
Provident Financial Group, Inc. and Subsidiaries
Consolidated Capital Data
(unaudited)
2002
First Full
Quarter Year
Per Common Share:
Shares Outstanding (In Thousands):
Average - Basic 49,228 48,806
Average - Diluted 50,588 50,743
Period-End 49,257
Book Value $16.63
Price:
High $29.97 $31.35
Low 22.17 21.48
Period-End 28.80
Capital Ratios (Dollars in Millions):
Risk-Based Capital (Current Qtr
Estimated):
Risk-Adjusted Assets $13,248
Tier 1 Capital $1,104
Percentage of Risk Adjusted
Assets 8.34%
Total Capital $1,439
Percentage of Risk Adjusted
Assets 10.86%
Tier 1 Leverage Ratio 6.76%
Period End Shareholders' Equity
to Total Period-End Assets 5.07%
Period-End Tangible Shareholders'
Equity
to Total Period-End Tangible Assets 4.48%
Average Shareholders' Equity
to Total Average Assets 5.06% 5.12%
Average Tangible Shareholders' Equity
to Total Average Tangible Assets 4.47% 4.55%
Provident Financial Group, Inc. and Subsidiaries
Financial Information Excluding Sale of Subprime and Merchant Services
Business
(unaudited)
In conjunction with the sale of subprime residential mortgage loans and
the Merchant Services business during the second quarter of 2003, the
company believes presenting financial information excluding these sales
might be beneficial to the reader as it provides data that is more
comparable to other periods contained within this document.
As Sale of
Reported Subprime Merchant Excluding
(GAAP) Loans Services Sales
For the Three Months
Ended June 30, 2003:
Condensed Income Statement
(In Thousands):
Net Interest Income $84,494 $- $- $84,494
Provision for Loan
and Leases Losses (52,469) (33,225) - (19,244)
Noninterest Income 213,753 - 19,000 194,753
Noninterest Expense (226,073) (6,914) - (219,159)
Income Before
Income Taxes 19,705 (40,139) 19,000 40,844
Applicable Income
Taxes (6,502) 13,246 (6,270) (13,478)
Net Income $13,203 $(26,893) $12,730 $27,366
Other Data:
Earnings Per Common
Share - Diluted $0.26 $(0.53) $0.25 $0.54
Return on Assets 0.30% (0.60)% 0.28% 0.61%
Return on Equity 5.85% (11.91)% 5.64% 12.12%
Net Charge Offs 68,470 49,225 n/a 19,245
Net Charge Offs to
Average
Loans and Leases
(annualized) 2.98% n/a n/a 0.84%
For the Nine Months
Ended September 30, 2003:
Condensed Income Statement
(In Thousands):
Net Interest Income $241,576 $- $- $241,576
Provision for Loan
and Leases Losses (80,909) (33,225) - (47,684)
Noninterest Income 594,217 - 19,000 575,217
Noninterest Expense (656,266) (6,914) - (649,352)
Income Before
Income Taxes 98,618 (40,139) 19,000 119,757
Applicable Income
Taxes (32,140) 13,246 (6,270) (39,116)
Net Income $66,478 $(26,893) $12,730 $80,641
Other Data:
Earnings Per Common
Share - Diluted $1.31 $(0.53) $0.25 $1.59
Return on Assets 0.50% (0.20)% 0.10% 0.61%
Return on Equity 10.10% (4.09)% 1.93% 12.26%
Net Charge Offs 97,800 49,225 n/a 48,575
Net Charge Offs to
Average
Loans and Leases
(annualized) 1.44% n/a n/a 0.71%
Provident Financial Group, Inc. and Subsidiaries
Supplementary Data
(unaudited)
In conjunction with the reclassification of the company's auto leases from
the loan category to leased equipment, which is not included in loans or
earning assets, the company believes this presentation aids in
illustrating the impact the reclassification has on certain performance
measures as illustrated below. This is not intended to imply that, if this
reclassification were not made, these measures would be precisely equal to
the adjusted measures listed below. Instead, we are providing this data to
demonstrate in a general sense how these measures would look if the leased
equipment were treated as an earning asset and operating lease income and
depreciation expense were included in revenues.
Three Months Ended
Sept. 30, June 30, March 31,
(In Thousands) 2003 2003 2003
Net Interest Income $74,123 $84,494 $82,959
Add: Operating Lease Income 127,011 132,238 138,861
Less: Depreciation on Operating
Leases (90,800) (94,930) (99,653)
Net Financing Income $110,334 $121,802 $122,167
Noninterest Income $186,290 $213,753 $194,174
Less: Operating Lease Income (127,011) (132,238) (138,861)
Noninterest Income Excluding
Operating Lease Income $59,279 $81,515 $55,313
Total Financing Revenues $169,613 $203,317 $177,480
Noninterest Expenses $208,110 $226,073 $222,083
Less: Depreciation on Operating
Leases (90,800) (94,930) (99,653)
Noninterest Expenses Excluding
Depreciation on Operating Leases $117,310 $131,143 $122,430
Average Earning Assets $14,662,000 $14,593,000 $14,194,000
Add: Average Leased Equipment 1,918,000 2,101,000 2,242,000
Average Earning Assets Including
Leased Equipment $16,580,000 $16,694,000 $16,436,000
Net Interest Margin Ratio - GAAP
Basis 2.01% 2.32% 2.37%
Net Financing Income Ratio 2.64% 2.93% 3.01%
Noninterest Expenses as a Percent
of Total Revenues - GAAP Basis 80% 76% 80%
Noninterest Expenses Excluding
Depreciation on Operating Leases
as a Percent of Total Revenues
Which Includes Depreciation on
Operating Leases 69% 65% 69%
Provident Financial Group, Inc. and Subsidiaries
Supplementary Data
(unaudited)
Nine Months Ended
(In Thousands) Sept. 30, 2003 Sept. 30, 2002
Net Interest Income $241,576 $234,649
Add: Operating Lease Income 398,110 457,780
Less: Depreciation on Operating
Leases (285,383) (317,553)
Net Financing Income $354,303 $374,876
Noninterest Income $594,217 $601,205
Less: Operating Lease Income (398,110) (457,780)
Noninterest Income Excluding
Operating Lease Income $196,107 $143,425
Total Financing Revenues $550,410 $518,301
Noninterest Expenses $656,266 $649,328
Less: Depreciation on Operating
Leases (285,383) (317,553)
Noninterest Expenses Excluding
Depreciation on Operating Leases $370,883 $331,775
Average Earning Assets $14,484,000 $12,924,000
Add: Average Leased Equipment 2,088,000 2,516,000
Average Earning Assets Including
Leased Equipment $16,572,000 $15,440,000
Net Interest Margin Ratio - GAAP
Basis 2.23% 2.43%
Net Financing Income Ratio 2.86% 3.25%
Noninterest Expenses as a Percent of
Total Revenues - GAAP Basis 79% 78%
Noninterest Expenses Excluding
Depreciation on Operating Leases
as a Percent of Total Revenues
Which Includes Depreciation on
Operating Leases 67% 64%
The company has average leased equipment which as a percentage of total
average assets were 11.8% and 15.4% for the nine month periods presented.
Because of the significance of the leased equipment, which generates
significant revenues but are not included in earning assets in the
financial statements, the company believes that in order to compare some
of the company's key metrics to other banks, the impact these financing
assets have on the company's net interest margin and its noninterest
expenses as a percentage of total revenues should be illustrated.
Additionally, from an internal management perspective, the leased
equipment is included in the company's overall interest sensitivity
analysis and these assets are typically priced based on the company's cost
of funds. In the financial statements, the financing cost directly
related to these assets is included in net interest income and the related
operating lease revenue and depreciation is reported separately in
noninterest income and noninterest expense. The revenue and expense
amounts listed above are derived from the company's income statements and
statements of cash flows. The balance sheet data is derived from the
company's average balance sheets.