EXHIBIT 99
[MBT LOGO]
MBT FINANCIAL CORP. REPORTS 2004 FULL YEAR
AND FOURTH QUARTER EARNINGS
MONROE, MICHIGAN, January 13, 2005 - MBT Financial Corp., (Nasdaq: MBTF), the
parent company of Monroe Bank & Trust, reported 2004 net income of $22.6
million, an increase of 17.0% over the $19.3 million reported for 2003. The
increase is the result of an increase of $2.4 million, or 4.8% in Net Interest
Income and a decrease of $5.5 million, or 68.9% in the Provision for Loan
Losses. Basic earnings per share were $1.30, a 27.5% increase over the $1.02
reported for 2003 (diluted earnings per share were $1.29 for 2004 versus $1.01
for 2003). Share repurchases from a combination of a self-tender completed in
December of 2003 and an ongoing share repurchase program resulted in an 8.1%
decline in average diluted shares outstanding from 19,072,629 to 17,533,057.
For the fourth quarter net income was $5.4 million, a 16.3% decrease from the
$6.5 million reported for the fourth quarter of 2003. The decrease is attributed
to significantly lower loan loss provision, incentive compensation, and other
expenses in the fourth quarter of 2003. Diluted earnings per share were $0.31,
compared to $0.34 for the prior-year quarter.
H. Douglas Chaffin, President and CEO, commented, "We had a good year,
reflective of our efforts over the past two years to revitalize the Company's
strategic focus. We achieved strong earnings growth, strong profitability, and
improved asset quality. We continue to focus on those strategies contributing to
our profitable growth: geographic expansion, product expansion, the addition of
highly-qualified staff, investment in technology, and asset quality improvement.
At the same time, we are mindful of our traditional strengths: our dominant
market position in Monroe County and our efficient operating structure."
"We opened our new Downriver Regional Center in Wyandotte in October and we are
in the process of renovating a building in Taylor for a new branch location.
This branch will provide our fourth full-service office in the Downriver area of
southern Wayne County, a market similar in demographics to Monroe County, and
one that has been underserved by community banks. We also announced in the
fourth quarter that we plan to construct a new headquarters building in downtown
Monroe. This 45,000 square foot building will provide much needed additional
space for our growing operations."
Total revenue, comprised of net interest income and non-interest income, was
$66.5 million in 2004, an increase of 3.7% over the $64.1 million earned during
2003. Total revenue excluding securities gains and mortgage loan origination
fees increased 5.4% from $62.0 million in 2003 to $65.3 million in 2004. Mr.
Chaffin noted, "Our efforts to restructure the balance sheet, begun in 2003,
have improved our net interest income, and positioned us for earnings growth in
a rising interest rate environment." Net interest income increased 6.6% to $13.5
million for the 2004 fourth quarter, reflecting a combination of 4.6% growth in
average earning assets and a 9 basis point improvement in the net interest
margin to 3.49%.
Non-interest income, net of securities gains, was $3.3 million, an increase of
10.3%. Leading the improvement in non interest income was strong growth in
income from trust services, up 22.7%.
Non-interest expense for the fourth quarter of 2004 was $8.7 million, an
increase of $1,164,000, or 15.4% over the prior-year period. During the quarter,
the Company expensed $150,000 to accelerate the depreciation of a parking lot
that will be
the site of its new headquarters in Monroe. Also, the incentive compensation
accrual, which is based on the company's earnings performance, increased
$668,000 compared to the fourth quarter of 2003. Mr. Chaffin noted that the
Company continues its legacy of a highly efficient operating structure while
increasing its investment to support its strategic initiatives. The efficiency
ratio for the fourth quarter of 2004 was 47.47%.
Mr. Chaffin highlighted the Company's continuing progress at improving asset
quality. "Although nonperforming assets increased $229,000 during the fourth
quarter, they were down $7.2 million, or 15.2% for the year. We were pleased to
work out over $4 million of nonperforming assets during the quarter; however,
several accounts which were previously classified as substandard were moved into
nonperforming status. These were expected additions to our nonperforming assets
and will not inhibit our projection to reduce total nonperforming assets to $31
million by the third quarter of 2005." Charge-offs, net of recoveries, exceeded
the Provision for Loan Losses during the quarter, reducing the Allowance for
Loan Losses by $1.4 million. Due to strong collateral positions in the
nonperforming assets, the Allowance for Loan Losses provides an adequate reserve
for potential losses. Non-performing assets were 2.57% of total assets at
December 31, 2004, up from 2.55% at September 30, 2004, but down from 3.23% at
December 31, 2003. The Allowance for Loan Losses was $13.8 million, or 1.46% of
total loans at December 31, 2004.
Total assets were $1.55 billion at December 31, 2004, an increase of 6.5% from
the prior year end. Loans rose $82.0 million, or 9.5% during the year, primarily
funded through deposit growth of $61.6 million and an increase of $16.5 million
in borrowed funds.
Shareholders' equity at December 31, 2004 was $155.3 million, a twelve-month
increase of 8.3%. Average equity to assets for the fourth quarter was 10.04% and
total shares outstanding at quarter end were 17,465,839. Mr. Chaffin concluded,
"Our improving fundamentals are confirmation of the strategy we have undertaken
over the last two years to revitalize our business. Local business conditions
are slowly improving, and we are optimistic as we begin 2005."
CONFERENCE CALL
MBT Financial Corp. will hold a conference call to discuss fourth quarter
results on Friday, January 14, at 10:00 a.m. Eastern Time. The call will be
webcast and can be accessed at the Investor Relations/Corporate Profile page of
MBT Financial Corp.'s web site www.MBandT.com. The call can also be accessed by
calling (877) 407-8031. The event will be archived on the Company's web site and
available for one month following the call.
ABOUT THE COMPANY
MBT Financial Corp., a single bank holding company headquartered in Monroe,
Michigan is the parent company of Monroe Bank & Trust, which was founded in
1858. The bank has $1.5 billion in assets and services nearly $1 billion in
trust assets. MBT is a full-service bank, offering a broad range of services,
from personal and business accounts to complete credit options and the area's
largest Trust Department. With 25 offices, 36 ATMs, PhoneLink telephone banking
and eLink online banking, MBT is the area's most accessible community bank.
MBT is proud to be an active supporter of the community through contributions,
reinvestment, and civic involvement. MBT is also known for ENLIST, its employee
volunteer program, which celebrated its 20th anniversary in 2004. Since its
inception, participants in the ENLIST program have contributed over 90,000 hours
of volunteer work in the communities we serve. Visit MBT's web site at
www.MBandT.com, where extensive financial and corporate information can be found
in the Investor Relations section.
FORWARD-LOOKING STATEMENTS
Certain statements contained herein are not based on historical facts and are
"forward-looking statements" within the meaning of Section 21A of the Securities
Exchange Act of 1934. Forward-looking statements which are based on various
assumptions (some of which are beyond the Corporation's control), may be
identified by reference to a future period or periods, or by the use of
forward-looking terminology, such as "may," "will," "believe," "expect,"
"estimate," "anticipate," "continue," or similar terms or variations on those
terms, or the negative of these terms. Actual results could differ materially
from those set forth in forward-looking statements, due to a variety of factors,
including, but not limited to, those related to the economic environment,
particularly in the market areas in which the company operates, competitive
products and pricing, fiscal and monetary policies of the U.S. Government,
changes in government regulations affecting financial institutions, including
regulatory fees and capital requirements, changes in prevailing interest rates,
acquisitions and the integration of acquired businesses, credit risk management,
asset/liability management, the financial and securities markets
and the availability of and costs associated with sources of liquidity. The
Corporation undertakes no obligation to update or clarify forward-looking
statements, whether as a result of new information, future events or otherwise.
FOR FURTHER INFORMATION:
H. Douglas Chaffin John L. Skibski Herbert J. Lock
Chief Executive Officer Chief Financial Officer Investor Relations
(734) 384-8123 (734) 242-1879 (734) 242-2603
doug.chaffin@mbandt.com john.skibski@mbandt.com herb.lock@mbandt.com
MBT FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED
QUARTERLY
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2004 2004 2004 2004 2003
(dollars in thousands except per share data) 4TH QTR 3RD QTR 2ND QTR 1ST QTR 4TH QTR
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EARNINGS
Net interest income $ 13,454 $ 13,627 $ 12,985 $ 12,640 $ 12,626
FTE Net interest income $ 14,079 $ 14,277 $ 13,649 $ 13,316 $ 13,598
Provision for loan and lease losses $ 691 $ 600 $ 600 $ 600 $ 30
Non-interest income $ 3,793 $ 3,396 $ 3,361 $ 3,226 $ 3,202
Non-interest expense $ 8,707 $ 8,025 $ 7,995 $ 7,889 $ 7,543
Net income $ 5,442 $ 6,109 $ 5,648 $ 5,400 $ 6,504
Basic earnings per share $ 0.32 $ 0.35 $ 0.32 $ 0.31 $ 0.36
Diluted earnings per share $ 0.31 $ 0.35 $ 0.32 $ 0.31 $ 0.35
Average shares outstanding 17,426,995 17,419,214 17,429,648 17,501,262 18,747,900
Average diluted shares outstanding 17,562,768 17,520,938 17,500,695 17,579,979 18,779,982
PERFORMANCE RATIOS
Return on average assets 1.41% 1.59% 1.55% 1.52% 1.76%
Return on average common equity 14.02% 16.58% 15.26% 14.90% 15.69%
Net interest margin, net of loan fees 3.49% 3.55% 3.56% 3.58% 3.40%
Efficiency ratio 47.47% 44.65% 45.34% 46.98% 41.89%
Full-time equivalent employees 396 404 387 386 389
CAPITAL
Average equity to average assets 10.04% 9.58% 10.15% 10.19% 11.20%
Book value per share $ 8.89 $ 8.80 $ 8.29 $ 8.50 $ 8.20
Cash dividend per share $ 0.16 $ 0.16 $ 0.15 $ 0.15 $ 0.15
ASSET QUALITY
Loan Charge-Offs $ 2,451 $ 616 $ 714 $ 666 $ 6,683
Loan Recoveries $ 376 $ 224 $ 330 $ 326 $ 778
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Net Charge-Offs $ 2,075 $ 392 $ 384 $ 340 $ 5,905
Allowance for loan and lease losses $ 13,800 $ 15,184 $ 14,976 $ 14,760 $ 14,500
Nonaccrual Loans $ 29,015 $ 29,993 $ 31,525 $ 32,538 $ 33,664
Loans 90 days past due $ 230 $ 222 $ 189 $ 259 $ 100
Restructured loans $ 3,715 $ 3,219 $ 3,348 $ 2,561 $ 4,755
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Total nonperforming loans $ 32,960 $ 33,434 $ 35,062 $ 35,358 $ 38,519
Other real estate owned $ 6,958 $ 6,255 $ 6,570 $ 8,579 $ 8,434
Nonperforming investment securities $ -- $ -- $ 163 $ 171 $ 140
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Total nonperforming assets $ 39,918 $ 39,689 $ 41,795 $ 44,108 $ 47,093
Net loan charge-offs to average loans 0.87% 0.17% 0.17% 0.16% 2.78%
Allowance for losses to total loans 1.46% 1.61% 1.62% 1.67% 1.68%
Nonperforming loans (including OREO)
to Gross Loans 4.22% 4.20% 4.51% 4.98% 5.44%
Nonperforming assets to total assets 2.57% 2.55% 2.74% 3.12% 3.23%
Allowance for loan losses to
nonperforming assets 34.57% 38.26% 35.83% 33.46% 30.79%
END OF PERIOD BALANCES
Loans and leases $ 945,881 $ 945,591 $ 923,738 $ 882,290 $ 863,850
Total earning assets $ 1,465,322 $ 1,463,425 $ 1,433,115 $ 1,326,025 $ 1,372,332
Total assets $ 1,552,279 $ 1,554,321 $ 1,523,976 $ 1,412,692 $ 1,457,788
Deposits $ 1,100,711 $ 1,072,426 $ 1,038,441 $ 1,020,188 $ 1,039,117
Shareholders' equity $ 155,346 $ 153,320 $ 144,393 $ 148,899 $ 143,446
Total Shares Outstanding 17,465,839 17,419,910 17,417,443 17,509,817 17,491,784
AVERAGE BALANCES
Loans and leases $ 948,628 $ 934,031 $ 905,502 $ 872,746 $ 854,473
Total earning assets $ 1,454,891 $ 1,444,880 $ 1,378,490 $ 1,341,444 $ 1,390,854
Total assets $ 1,538,860 $ 1,529,700 $ 1,466,359 $ 1,430,303 $ 1,468,278
Deposits $ 1,079,610 $ 1,062,755 $ 1,028,702 $ 1,029,856 $ 1,077,644
Shareholders' equity $ 154,428 $ 146,579 $ 148,877 $ 145,751 $ 164,458
MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
QUARTER ENDED DECEMBER 31,
Dollars in thousands (except per share data) 2004 2003
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INTEREST INCOME
Interest and fees on loans $15,259 $13,475
Interest on investment securities-
Tax-exempt 1,355 1,502
Taxable 4,527 3,879
Interest on federal funds sold 8 40
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Total interest income 21,149 18,896
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INTEREST EXPENSE
Interest on deposits 4,353 3,626
Interest on borrowed funds 3,342 2,644
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Total interest expense 7,695 6,270
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NET INTEREST INCOME 13,454 12,626
PROVISION FOR LOAN LOSSES 691 30
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NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 12,763 12,596
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OTHER INCOME
Income from trust services 1,058 862
Service charges and other fees 1,403 1,343
Net gain (loss) on sales of securities 451 173
Origination fees on mortgage loans sold 118 56
Bank Owned Life Insurance income 244 395
Other 519 373
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Total other income 3,793 3,202
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OTHER EXPENSES
Salaries and employee benefits 4,690 3,700
Occupancy expense 837 763
Other 3,180 3,080
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Total other expenses 8,707 7,543
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INCOME BEFORE PROVISION
FOR INCOME TAXES 7,849 8,255
PROVISION FOR INCOME TAXES 2,407 1,751
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NET INCOME $ 5,442 $ 6,504
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BASIC EARNINGS PER COMMON SHARE $ 0.32 $ 0.35
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DILUTED EARNINGS PER COMMON SHARE $ 0.31 $ 0.34
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DIVIDENDS DECLARED PER COMMON SHARE $ 0.16 $ 0.15
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MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
YEAR ENDED DECEMBER 31,
Dollars in thousands (except per share data) 2004 2003
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INTEREST INCOME
Interest and fees on loans $57,660 $55,253
Interest on investment securities-
Tax-exempt 5,613 6,206
Taxable 16,420 16,166
Interest on federal funds sold 10 149
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Total interest income 79,703 77,774
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INTEREST EXPENSE
Interest on deposits 14,923 15,991
Interest on borrowed funds 12,075 11,476
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Total interest expense 26,998 27,467
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NET INTEREST INCOME 52,705 50,307
PROVISION FOR LOAN LOSSES 2,491 8,005
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NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 50,214 42,302
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OTHER INCOME
Income from trust services 3,746 3,316
Service charges and other fees 5,476 5,309
Net gain on sales of securities 567 1,041
Origination fees on mortgage loans sold 578 1,068
Bank Owned Life Insurance income 1,371 1,305
Other 2,038 1,764
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Total other income 13,776 13,803
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OTHER EXPENSES
Salaries and employee benefits 18,109 16,122
Occupancy expense 3,029 2,696
Other 11,478 11,361
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Total other expenses 32,616 30,179
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INCOME BEFORE PROVISION
FOR INCOME TAXES 31,374 25,926
PROVISION FOR INCOME TAXES 8,775 6,611
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NET INCOME $22,599 $19,315
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BASIC EARNINGS PER COMMON SHARE $ 1.30 $ 1.02
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DILUTED EARNINGS PER COMMON SHARE $ 1.29 $ 1.01
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DIVIDENDS DECLARED PER COMMON SHARE $ 0.62 $ 0.58
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MBT FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS - UNAUDITED
DECEMBER 31, DECEMBER 31,
Dollars in thousands 2004 2003
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ASSETS
Cash and Cash Equivalents
Cash and due from banks $ 20,540 $ 22,525
Federal funds sold 14,000 --
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Total cash and cash equivalents 34,540 2,525
Securities - Held to Maturity 84,141 99,154
Securities - Available for Sale 408,353 397,642
Federal Home Loan Bank stock - at cost 12,947 11,686
Loans held for sale 778 1,406
Loans - Net 931,303 847,944
Accrued interest receivable and other assets 22,895 25,627
Bank Owned Life Insurance 35,152 33,780
Premises and Equipment - Net 22,170 18,024
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Total assets $ 1,552,279 $ 1,457,788
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LIABILITIES
Deposits:
Non-interest bearing $ 149,469 $ 135,536
Interest-bearing 951,242 903,581
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Total deposits 1,100,711 1,039,117
Federal Home Loan Bank advances 256,500 225,000
Federal funds purchased -- 45,000
Repurchase agreements 30,000 --
Interest payable and other liabilities 9,722 5,225
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Total liabilities 1,396,933 1,314,342
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STOCKHOLDERS' EQUITY
Common stock (no par value) -- --
Additional paid-in capital 19,806 20,414
Retained Earnings 135,647 123,867
Accumulated other comprehensive income (107) (835)
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Total stockholders' equity 155,346 143,446
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Total liabilities and stockholders' equity $ 1,552,279 $ 1,457,788
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