1
EXHIBIT 99.2
PROVIDENT BANKSHARES CORPORATION AND SUBSIDIARIES
ASSET QUALITY DETAIL
March 31, March 31, December 31,
(dollars in thousands) 2004 2003 2003
--------------- --------------- -------------
LOAN PORTFOLIO:
Acquired residential mortgage $ 598,517 $ 500,487 $ 611,157
Residential real estate mortgage 71,854 140,208 78,164
Other consumer:
Home Equity 536,244 376,795 505,465
Marine 461,200 429,689 464,474
Other 40,766 68,221 49,721
--------------- --------------- -------------
Total consumer 1,708,581 1,515,400 1,708,981
Commercial business 407,599 364,403 386,603
Residential real estate construction 171,864 131,872 161,932
Commercial real estate construction 219,287 196,247 208,594
Commercial real estate mortgage 322,605 254,100 318,436
--------------- --------------- -------------
Total loans $ 2,829,936 $ 2,462,022 $ 2,784,546
=============== =============== =============
NON-PERFORMING ASSETS:
Acquired residential mortgage $ 15,463 $ 17,510 $ 16,401
Residential real estate mortgage 2,474 3,141 2,560
Other consumer 172 493 136
Commercial business 680 493 3,085
Residential real estate construction 134 - 135
--------------- --------------- -------------
Total non-accrual loans 18,923 21,637 22,317
Total renegotiated loans - - -
--------------- --------------- -------------
Total non-performing loans 18,923 21,637 22,317
Total other assets and real estate owned 2,855 4,155 3,243
--------------- --------------- -------------
Total non-performing assets $ 21,778 $ 25,792 $ 25,560
=============== =============== =============
90-DAY DELINQUENCIES:
Acquired residential mortgage $ 3,248 $ 6,229 $ 4,181
Residential real estate mortgage 4,394 5,466 4,669
Other consumer 1,177 430 498
Commercial business 469 407 544
Residential real estate construction - 136 -
--------------- --------------- -------------
Total 90-day delinquencies $ 9,288 $ 12,668 $ 9,892
=============== =============== =============
Asset Quality Ratios:
Non-performing loans to loans 0.67% 0.88% 0.80%
Non-performing assets to loans 0.77% 1.05% 0.92%
Allowance for loan losses to loans 1.28% 1.32% 1.28%
Net charge-offs in quarter to average loans 0.23% 0.38% 0.21%
Allowance for loan losses to non-performing loans 190.91% 150.49% 159.25%
Three Months Ended March 31, Three Months
----------------------------------- Ended Dec. 31,
ANALYSIS OF ALLOWANCE FOR LOAN LOSSES: 2004 2003 2003
--------------- --------------- ---------------
Balance at beginning of period $ 35,539 $ 33,425 $ 35,006
Provision for loan losses 2,174 1,760 1,975
Transfer to other liabilities - (262) -
Less loans charged-off, net of recoveries:
Acquired residential mortgage 1,236 1,898 993
Residential real estate mortgage - (49) 12
Other consumer 44 390 132
Commercial business 307 122 305
--------------- --------------- ---------------
Net charge-offs 1,587 2,361 1,442
--------------- --------------- ---------------
Balance at end of period $ 36,126 $ 32,562 $ 35,539
=============== =============== ===============
2
PROVIDENT BANKSHARES CORPORATION
CONSOLIDATED AVERAGE BALANCES AND ANALYSIS OF CHANGES IN TAX EQUIVALENT NET INTEREST INCOME
- --------------------------------------------------------------------------------------------------
THREE MONTHS ENDED Three Months Ended
MARCH 31, 2004 March 31, 2003
---------------------------------------------------------------
(dollars in thousands) AVERAGE INCOME/ YIELD/ Average Income/ Yield/
(tax-equivalent basis) BALANCE EXPENSE RATE Balance Expense Rate
----------- --------- -------------------- -------- --------
ASSETS:
Interest-earning assets:
Acquired residential mortgage $ 604,064 $ 9,008 6.00 % $ 515,256 $ 8,578 6.75%
Residential mortgage 74,932 1,310 7.03 153,770 2,803 7.39
Home equity 519,019 6,132 4.75 374,534 5,009 5.42
Marine 463,706 6,047 5.24 428,833 6,264 5.92
Other direct consumer 34,785 671 7.76 41,703 842 8.19
Other indirect consumer 9,576 199 8.36 32,424 614 7.68
----------- --------- ----------- --------
Total consumer 1,706,082 23,367 5.51 1,546,520 24,110 6.32
Commercial business 386,264 5,321 5.54 342,097 5,133 6.09
Real estate-construction 367,757 3,881 4.24 314,064 3,455 4.46
Commercial mortgage 321,943 4,340 5.42 247,022 3,785 6.21
Non-core syndicated loans 28,008 259 3.72 49,845 457 3.72
----------- --------- ----------- --------
Total loans 2,810,054 37,168 5.32 2,499,548 36,940 5.99
----------- --------- ----------- --------
Loans held for sale 4,149 64 6.20 8,651 121 5.67
Short-term investments 1,592 2 0.51 2,297 8 1.41
Taxable investment securities 2,076,697 22,534 4.36 2,030,410 24,049 4.80
Tax-advantaged investment securities 16,617 298 7.21 19,541 339 7.04
----------- --------- ----------- --------
Total investment securities 2,093,314 22,832 4.39 2,049,951 24,388 4.82
----------- --------- ----------- --------
Total interest-earning assets 4,909,109 60,066 4.92 4,560,447 61,457 5.47
----------- --------- ----------- --------
Less: allowance for loan losses (35,576) (32,766)
Cash and due from banks 118,671 103,084
Other assets 238,582 253,062
----------- -----------
Total assets $5,230,786 $4,883,827
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Interest-bearing liabilities:
Demand/money market deposits $ 917,272 1,330 0.58 $ 844,448 1,723 0.83
Savings deposits 715,265 510 0.29 677,776 1,090 0.65
Direct time deposits 652,280 3,322 2.05 757,250 5,558 2.98
Brokered time deposits 218,863 3,452 6.34 398,018 6,002 6.12
Short-term borrowings 670,195 1,578 0.95 439,184 1,266 1.17
Long-term debt 1,135,984 10,948 3.88 970,656 10,017 4.19
----------- --------- ----------- --------
Total interest-bearing liabilities 4,309,859 21,140 1.97 4,087,332 25,656 2.55
----------- --------- ----------- --------
Noninterest-bearing demand deposits 567,530 469,676
Other liabilities 20,974 24,439
Stockholders' equity 332,423 302,380
----------- -----------
Total liabilities and
stockholders' equity $5,230,786 $4,883,827
=========== ===========
Net interest-earning assets $ 599,250 $ 473,115
=========== ===========
Net interest income (tax-equivalent) 38,926 35,801
Less: tax-equivalent adjustment (203) (174)
--------- --------
Net interest income $ 38,723 $35,627
========= ========
Net yield on interest-earning assets 3.19 % 3.18%
-------------------------------------------------------------------------
2004/2003
INCOME/EXPENSE VARIANCE
2004/2003 INCREASE/(DECREASE) DUE TO CHANGE IN
--------------------------------------------- -------------------------
(dollars in thousands) AVERAGE % INCOME/ % AVERAGE AVERAGE
(tax-equivalent basis) BALANCE CHANGE EXPENSE CHANGE RATE VOLUME
------------ -------- --------- ---------- ------------ ------------
ASSETS:
Interest-earning assets:
Acquired residential mortgage $ 88,808 17.2 % $ 430 5.0% $ (1,006) $ 1,436
Residential mortgage (78,838) (51.3) (1,493) (53.3) (130) (1,363)
Home equity 144,485 38.6 1,123 22.4 (677) 1,800
Marine 34,873 8.1 (217) (3.5) (730) 513
Other direct consumer (6,918) (16.6) (171) (20.3) (41) (130)
Other indirect consumer (22,848) (70.5) (415) (67.6) 51 (466)
------------ ---------
Total consumer 159,562 10.3 (743) (3.1)
Commercial business 44,167 12.9 188 3.7 (472) 660
Real estate-construction 53,693 17.1 426 12.3 (170) 596
Commercial mortgage 74,921 30.3 555 14.7 (523) 1,078
Non-core syndicated loans (21,837) (43.8) (198) (43.3) - (198)
------------ ---------
Total loans 310,506 12.4 228 0.6
------------ ---------
Loans held for sale (4,502) (52.0) (57) (47.1) 11 (68)
Short-term investments (705) (30.7) (6) (75.0) (4) (2)
Taxable investment securities 46,287 2.3 (1,515) (6.3) (2,100) 585
Tax-advantaged investment securities (2,924) (15.0) (41) (12.1) 9 (50)
------------ ---------
Total investment securities 43,363 2.1 (1,556) (6.4)
------------ ---------
Total interest-earning assets 348,662 7.6 (1,391) (2.3) (6,161) 4,770
------------ ---------
Less: allowance for loan losses (2,810) 8.6
Cash and due from banks 15,587 15.1
Other assets (14,480) (5.7)
------------
Total assets $ 346,959 7.1
============
LIABILITIES AND STOCKHOLDERS' EQUITY:
Interest-bearing liabilities:
Demand/money market deposits $ 72,824 8.6 (393) (22.8) (537) 144
Savings deposits 37,489 5.5 (580) (53.2) (639) 59
Direct time deposits (104,970) (13.9) (2,236) (40.2) (1,548) (688)
Brokered time deposits (179,155) (45.0) (2,550) (42.5) 223 (2,773)
Short-term borrowings 231,011 52.6 312 24.6 (274) 586
Long-term debt 165,328 17.0 931 9.3 (762) 1,693
------------ ---------
Total interest-bearing liabilities 222,527 5.4 (4,516) (17.6) (5,911) 1,395
------------ ---------
Noninterest-bearing demand deposits 97,854 20.8
Other liabilities (3,465) (14.2)
Stockholders' equity 30,043 9.9
------------
Total liabilities and stockholder's equity $ 346,959 7.1
============
Net interest-earning assets $ 126,135 26.7
============
Net interest income (tax-equivalent) 3,125 8.7 $ (250) $ 3,375
Less: tax-equivalent adjustment (29) 16.7
---------
Net interest income $ 3,096 8.7
=========
Net yield on interest-earning ass
3
PROVIDENT BANKSHARES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
Three Months Ended
March 31,
------------------------------
(dollars in thousands, except per share data) 2004 2003
------------- --------------
INTEREST INCOME:
Loans, including fees $ 36,985 $ 36,826
Investment securities 22,534 24,049
Tax-advantaged loans and securities 342 400
Short-term investments 2 8
------------- --------------
Total interest income 59,863 61,283
------------- --------------
INTEREST EXPENSE:
Deposits 8,614 14,373
Short-term borrowings 1,578 1,266
Long-term debt 10,948 10,017
------------- --------------
Total interest expense 21,140 25,656
------------- --------------
Net interest income 38,723 35,627
Less provision for loan losses 2,174 1,760
------------- --------------
Net interest income, after provision for loan losses 36,549 33,867
------------- --------------
NON-INTEREST INCOME:
Service charges on deposit accounts 18,531 17,321
Commissions and fees 1,224 1,310
Net gains 816 1,247
Other non-interest income 3,012 2,713
------------- --------------
Total non-interest income 23,583 22,591
------------- --------------
NON-INTEREST EXPENSE:
Salaries and employee benefits 20,421 18,984
Occupancy expense, net 4,050 4,016
Furniture and equipment expense 3,144 2,866
External processing fees 5,302 5,092
Other non-interest expense 7,910 8,092
------------- --------------
Total non-interest expense 40,827 39,050
------------- --------------
Income before income taxes 19,305 17,408
Income tax expense 6,430 5,623
------------- --------------
Net income $ 12,875 $ 11,785
============= ==============
NET INCOME PER SHARE AMOUNTS:
Basic $ 0.52 $ 0.48
Diluted 0.51 0.47
4
PROVIDENT BANKSHARES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CONDITION
March 31, December 31, March 31,
(dollars in thousands, except share amounts) 2004 2003 2003
-------------- -------------- -------------
ASSETS:
Cash and due from banks $ 116,006 $ 127,048 $ 132,005
Short-term investments 1,903 1,137 2,250
Mortgage loans held for sale 5,456 5,016 11,892
Securities available for sale 2,127,047 2,086,510 2,229,246
Loans 2,829,936 2,784,546 2,462,022
Less allowance for loan losses 36,126 35,539 32,562
-------------- -------------- -------------
Net loans 2,793,810 2,749,007 2,429,460
-------------- -------------- -------------
Premises and equipment, net 49,481 49,575 47,461
Accrued interest receivable 25,202 25,413 27,726
Intangible assets 8,830 8,932 9,238
Other assets 141,008 155,210 124,214
-------------- -------------- -------------
Total assets $5,268,743 $5,207,848 $5,013,492
============== ============== =============
LIABILITIES:
Deposits:
Noninterest-bearing $ 646,765 $ 579,058 $ 560,749
Interest-bearing 2,555,553 2,500,491 2,712,268
-------------- -------------- -------------
Total deposits 3,202,318 3,079,549 3,273,017
-------------- -------------- -------------
Short-term borrowings 555,637 627,861 287,318
Long-term debt 1,136,121 1,153,301 1,098,670
Accrued expenses and other liabilities 30,197 22,372 30,499
-------------- -------------- -------------
Total liabilities 4,924,273 4,883,083 4,689,504
-------------- -------------- -------------
STOCKHOLDERS' EQUITY:
Common stock (par value $1.00) authorized 100,000,000 shares; issued 32,410,354,
32,213,590 and 31,782,375 shares at March 31,
2004, December 31, 2003 and March 31, 2003, respectively 32,410 32,214 31,782
Additional paid-in capital 303,049 298,928 290,499
Retained earnings 160,385 153,545 131,164
Net accumulated other comprehensive income (loss) 1,959 (6,589) 16,126
Treasury stock at cost - 7,651,317, 7,651,317 and 7,373,601
shares at March 31, 2004, December 31, 2003 and
March 31, 2003, respectively (153,333) (153,333) (145,583)
-------------- -------------- -------------
Total stockholders' equity 344,470 324,765 323,988
-------------- -------------- -------------
Total liabilities and stockholders' equity $5,268,743 $5,207,848 $5,013,492
============== ============== =============