For Additional Information,
Contact David E. Keul
(704) 788-0482
FOR IMMEDIATE RELEASE
Concord, NC
January 26, 1998
FIRST CHARTER CORPORATION
ANNOUNCES RECORD ANNUAL AND FOURTH QUARTER EARNINGS
First Charter Corporation (NASDAQ National Market: FCTR) reported
today record 1997 earnings totaling $10,959,146, or $1.19 basic
income per share, before nonrecurring pretax charges of
$3,355,680 associated with completing the acquisition of Carolina
State Bank. Excluding the nonrecurring charges, 1997 earnings
per share increased 8.8% compared to 1996. First Charter's 1997,
results excluding the nonrecurring charges, produced a return on
average assets of 1.57% and a return on average equity of 14.40%,
compared to prior year ratios of 1.55% and 14.77%, respectively.
For the fourth quarter of 1997, First Charter earned a record
$2,841,100, excluding the nonrecurring charges, compared to
$2,567,219 in 1996, an increase of 10.7%. Excluding the
nonrecurring charges, basic income per share was $0.30 compared
to $0.28 in 1996.
Including nonrecurring charges, First Charter earned $8,400,902,
or $0.91 basic income per share, for the year ended 1997,
compared to $10,068,973, or $1.10 basic income per share, in
1996. The 1997 results also reflect a $1.4 million provision for
loan losses recorded by Carolina State Bank in 1997, compared to
$619,757 for 1996, in recognition of increased 1997 charge-offs
and portfolio growth. For the fourth quarter of 1997, net income
totaled $282,856, or $0.03 per share, compared to $2,567,219, or
$0.28 per share, in the fourth quarter of 1996.
Total assets at December 31, 1997 were $760 million, up 11.8%
from December 31, 1996. Gross loans increased 15% to $524
million and total deposits increased 9% to $621 million from
December 31, 1996. Total shareholders' equity was $78 million at
December 31, 1997, which represents a book value per share of
$8.39 and an equity-to-assets ratio of 10.23%. At year-end 1997,
First Charter had 9,268,573 shares outstanding. The closing
price of First Charter Corporation Common Stock at December 31,
1997 was $26.00 per share, resulting in a market capitalization
for the Corporation of $241 million.
The common stock of First Charter Corporation is traded on the
NASDAQ National Market under the symbol "FCTR". For information,
contact: Dean Witter Reynolds, Inc. (Larry Biggers, 1-800-786-0006),
Interstate/Johnson Lane Corporation (Connie Bailey, 1-800-929-0747),
J.C. Bradford Co. (Carl Cline, (1-800-222-1082), Legg
Mason Wood Walker Incorporated (A. Paul Newton, 1-800-628-5770),
and Wheat, First Securities, Inc. (Robert Phillips, 1-800-289-2671).
FIRST CHARTER CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, DECEMBER 31,
(Dollars in thousands) 1997 1996
------------ ------------
ASSETS:
Cash and due from banks............. $ 32,830 $ 34,517
Federal funds sold.................. - 4,510
Interest bearing bank deposits...... 7,975 10,855
Securities available for sale....... 177,234 143,664
Investment securities............... - 13,940
Loans, net.......................... 515,799 449,989
Other assets........................ 26,356 22,782
---------- ----------
Total assets................... $ 760,194 $ 680,257
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Total deposits...................... $ 621,354 $ 569,856
Other borrowings.................... 53,279 32,895
Other liabilities................... 7,756 5,785
---------- ----------
Total liabilities.............. 682,389 608,536
Total shareholders' equity..... 77,805 71,721
---------- ----------
Total liabilities and
shareholders' equity......... $ 760,194 $ 680,257
========== ==========
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS
ENDED
---------------------------
(Dollars in thousands, DEC. 31 DEC. 31
except per share data) 1997 1996
------------ ------------
Total interest income............... $ 14,701 $ 13,072
Total interest expense.............. 6,458 5,808
--------- ---------
Net interest income............... 8,243 7,264
Provision for loan losses........... 890 323
--------- ---------
Net interest income after
provision for loan losses....... 7,353 6,941
Total noninterest income............ 2,863 1,936
Total noninterest expense........... 9,524 5,181
--------- ---------
Income before income taxes........ 692 3,696
Income taxes........................ 409 1,128
--------- ---------
Net income........................ $ 283 $ 2,568
========= =========
Basic income per share data:
Net income........................ $ 0.03 $ 0.28
========= =========
Average common equivalent shares.. 9,395,844 9,208,433
Diluted income per share:
Net income........................ $ 0.03 $ 0.28
========= =========
Average common equivalent shares.. 9,539,612 9,260,481
Cash dividends declared............. $ 0.14 $ 0.125
========= =========
Book value.......................... $ 8.39 $ 7.80
========= =========
CONSOLIDATED STATEMENTS OF INCOME
FOR THE TWELVE MONTHS
ENDED
---------------------------
(Dollars in thousands, DEC. 31 DEC. 31
except per share data) 1997 1996
------------ ------------
Total interest income............... $ 55,954 $ 50,907
Total interest expense.............. 24,751 22,797
--------- ---------
Net interest income............... 31,203 28,110
Provision for loan losses........... 2,702 1,540
--------- ---------
Net interest income after
provision for loan losses....... 28,501 26,570
Total noninterest income............ 9,452 7,271
Total noninterest expense........... 25,642 19,354
--------- ---------
Income before income taxes........ 12,311 14,487
Income taxes........................ 3,910 4,418
--------- ---------
Net income........................ $ 8,401 $ 10,069
========= =========
Basic income per share data:
Net income........................ $ 0.91 $ 1.10
========= =========
Average common equivalent shares.. 9,236,786 9,183,738
Diluted income per share:
Net income........................ $ 0.90 $ 1.09
========= =========
Average common equivalent shares.. 9,338,547 9,234,946
Cash dividends declared............. $ 0.53 $ 0.50
========= =========
Book value.......................... $ 8.39 $ 7.80
========= =========
ALL PER SHARE DATA HAS BEEN RETROACTIVELY ADJUSTED TO REFLECT A
6-FOR-5 STOCK SPLIT DECLARED IN THE SECOND QUARTER OF 1997.
SELECTED AVERAGE BALANCES
FOR THE THREE MONTHS
ENDED
---------------------------
DECEMBER 31, DECEMBER 31,
(Dollars in thousands) 1997 1996
------------ ------------
Interest earning assets............. $ 689,702 $ 621,578
Interest bearing liabilities........ 564,093 501,471
Average assets...................... 732,171 665,692
Average equity...................... 79,060 70,443
FOR THE TWELVE MONTHS
ENDED
---------------------------
DECEMBER 31, DECEMBER 31,
(Dollars in thousands) 1997 1996
------------ ------------
Interest earning assets............. $ 658,831 $ 606,841
Interest bearing liabilities........ 538,155 494,669
Average assets...................... 698,204 648,268
Average equity...................... 76,103 68,165
ALLOWANCE FOR LOAN LOSSES
DECEMBER 31, DECEMBER 31,
(Dollars in thousands) 1997 1996
------------ ------------
Beginning balance (January 1)....... $ 6,528 $ 6,056
Add:
Provision charged to operations... 2,703 1,540
--------- ---------
9,231 7,596
--------- ---------
Less:
Loan charge-offs.................. 1,626 1,466
Less loan recoveries.............. 399 398
--------- ---------
Net loan charge-offs............ 1,227 1,068
--------- ---------
Ending balance...................... $ 8,004 $ 6,528
========= =========
ASSET QUALITY RATIOS
DECEMBER 31, DECEMBER 31,
1997 1996
------------ ------------
Nonaccruals to gross loans,
excluding loans held for sale....... 0.40% 0.36%
Net charge-offs to average loans.... 0.25% 0.24%
Allowance for loan losses to
gross loans, excluding loans
held for sale...................... 1.53% 1.43%
SIGNIFICANT OPERATING RATIOS
DECEMBER 31, DECEMBER 31,
1997 1996
------------ ------------
Gross loans to total deposits....... 84.34% 80.14%
Return on average assets............ 1.20% 1.55%
Return on average equity............ 11.04% 14.77%