EXHIBIT 99
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[MBT FINANCIAL CORP LOGO]
MBT FINANCIAL CORP. REPORTS FIRST QUARTER 2005 EARNINGS
MONROE, MICHIGAN, April 14, 2005 - MBT Financial Corp., (Nasdaq: MBTF), the
parent company of Monroe Bank & Trust, reported first quarter net income of $4.9
million, a decrease of 9.6% from the $5.4 million reported for the first quarter
of 2004. Basic and diluted earnings per share decreased 9.7% from $0.31 to
$0.28. Net Interest Income was unchanged at $12.6 million even though the
average earning assets increased 10% as the fully taxable equivalent net
interest margin declined from 3.99% to 3.62%. The Bank was able to reduce its
nonperforming assets (NPAs) by $3.8 million, or 9.5%, to $36.1 million. Also,
the adequacy of the Allowance for Loan Losses was maintained without increasing
the Provision for Loan Losses, and Non Interest Income increased 6.8% compared
to the first quarter of 2004.
H. Douglas Chaffin, President and CEO, commented, "The first quarter of 2005 was
challenging for us, but we believe that our fundamental strengths will lead to
improved financial performance. We are pleased with the increase in non interest
income, especially our income from Trust services. Although our spending has
increased due to our Downriver expansion and the new headquarters building that
we announced in the fourth quarter, we remain committed to expense control.
Salaries and benefits increased by only 4.1% and our efficiency ratio is still
among the best in the industry at 51.76%. We continue to focus on strategies
that will result in future earnings growth: geographic expansion, product
expansion, improving the quality of our 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."
"Our expansion into the southern Wayne County (Downriver) market has been
successful so far. At the end of the first quarter of 2004 we had three branches
with $42.8 million in total deposits. We now have four branches and over $75
million in deposits, and we plan to open our fifth Wayne County branch in the
second quarter. Our loan pipeline indicates that we can expect loan growth to
continue at its current pace, and approximately half of our loan growth is being
generated in the Downriver market."
Total revenue, comprised of net interest income and non-interest income, was
$16.1 million in the first quarter of 2005, an increase of 5.5% over the $15.2
million earned during the same period of 2004. Mr. Chaffin noted, "Interest Rate
Risk management is a crucial component of our strategy. We began to extend the
duration of our liabilities and shorten the duration of our assets in the second
half of 2003. This caused our cost of funds to increase while slowing the rate
of increase in the yield on our earning assets. Although this reduced our net
interest margin currently, we believe that we are better protected from future
earnings volatility due to changes in the interest rate environment." The Bank's
balance sheet is slightly asset sensitive; however, asset pricing tends to be
influenced by longer term market rates while liability pricing tends to be
influenced by shorter term rates. Over the last twelve months, the yield curve
has flattened as short term rates increased more than long term rates. This
contributed to the decline in the Bank's net interest margin.
Non-interest expense for the first quarter of 2005 was $8.7 million, an increase
of $840,000, or 10.6% over the prior-year period. During the quarter, the
Company expensed $100,000 to accelerate the depreciation of a parking lot that
will be the site of its new headquarters in Monroe. Excluding this charge,
Occupancy expenses only increased $41,000 compared to last year. Also, expenses
related to nonperforming assets increased $181,000 compared to the first quarter
of 2004 as the bank continued to aggressively work to reduce the amount of NPAs.
The total NPAs, which includes nonaccrual loans, loans 90 days past due, and
other real estate owned decreased $8.0 million, or 18.1% over the last twelve
months to $36.1 million.
Mr. Chaffin further commented on the Company's continuing progress at improving
asset quality. "Net Charge-offs increased to 0.89% of average loans this quarter
as we charged off a portion of a nonperforming asset prior to its liquidation.
The amount charged off was consistent with the specific allocation of our
Allowance for Loan Losses, and we were able to maintain an adequate allowance
without increasing the provision charged to earnings." Non-performing assets
were 2.33% of total assets at March 31, 2005, down from 2.57% at December 31,
2004, and 3.12% at March 31, 2004. The Allowance for Loan Losses was $12.0
million, or 1.28% of total loans at March 31, 2005.
Total assets were $1.55 billion at March 31, 2005, an increase of 9.8% from a
year earlier. Loans rose $57.9 million, or 6.6% over the year, funded by deposit
growth of $79.2 million, or 7.8% over the same period.
Shareholders' equity at March 31, 2005 was $153.6 million, a twelve-month
increase of 3.2%. Average equity to assets for the first quarter was 9.92% and
total shares outstanding at quarter end were 17,472,389. Mr. Chaffin concluded,
"Our earnings performance for the quarter did not meet our expectations, but we
believe that our sound fundamental strengths and the strategies we have
undertaken over the last two years to revitalize our business will result in
improvements."
CONFERENCE CALL
MBT Financial Corp. will hold a conference call to discuss first quarter results
on Friday, April 15, 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 $1.6 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 provides an incomparable level of service and
access for its customers. 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:
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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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2005 2004 2004 2004 2004
(dollars in thousands except per share data) 1ST QTR 4TH QTR 3RD QTR 2ND QTR 1ST QTR
----------- ----------- ----------- ----------- -----------
EARNINGS
Net interest income $ 12,622 $ 13,454 $ 13,627 $ 12,985 $ 12,640
FTE Net interest income $ 13,185 $ 14,079 $ 14,277 $ 13,649 $ 13,316
Provision for loan and lease losses $ 600 $ 691 $ 600 $ 600 $ 600
Non-interest income $ 3,446 $ 3,793 $ 3,396 $ 3,361 $ 3,226
Non-interest expense $ 8,729 $ 8,707 $ 8,025 $ 7,995 $ 7,889
Net income $ 4,879 $ 5,442 $ 6,109 $ 5,648 $ 5,400
Basic earnings per share $ 0.28 $ 0.32 $ 0.35 $ 0.32 $ 0.31
Diluted earnings per share $ 0.28 $ 0.31 $ 0.35 $ 0.32 $ 0.31
Average shares outstanding 17,498,000 17,426,995 17,419,214 17,429,648 17,501,262
Average diluted shares outstanding 17,593,705 17,562,768 17,520,938 17,500,695 17,579,979
PERFORMANCE RATIOS
Return on average assets 1.26% 1.41% 1.59% 1.55% 1.52%
Return on average common equity 12.72% 14.02% 16.58% 15.26% 14.90%
Base Margin 3.30% 3.49% 3.55% 3.56% 3.58%
FTE Adjustment 0.15% 0.17% 0.18% 0.19% 0.20%
Loan Fees 0.17% 0.19% 0.20% 0.23% 0.21%
----------- ----------- ----------- ----------- -----------
FTE Net Interest Margin 3.62% 3.85% 3.93% 3.98% 3.99%
Efficiency ratio 51.76% 47.47% 44.65% 45.34% 46.98%
Full-time equivalent employees 404 396 404 387 386
CAPITAL
Average equity to average assets 9.92% 10.04% 9.58% 10.15% 10.19%
Book value per share $ 8.79 $ 8.89 $ 8.80 $ 8.29 $ 8.50
Cash dividend per share $ 0.16 $ 0.16 $ 0.16 $ 0.15 $ 0.15
ASSET QUALITY
Loan Charge-Offs $ 2,644 $ 2,451 $ 616 $ 714 $ 666
Loan Recoveries $ 559 $ 376 $ 224 $ 330 $ 326
----------- ----------- ----------- ----------- -----------
Net Charge-Offs $ 2,085 $ 2,075 $ 392 $ 384 $ 340
Allowance for loan and lease losses $ 12,040 $ 13,800 $ 15,184 $ 14,976 $ 14,760
Nonaccrual Loans $ 27,625 $ 29,015 $ 29,993 $ 31,525 $ 32,538
Loans 90 days past due $ 101 $ 230 $ 222 $ 189 $ 259
Restructured loans $ 2,041 $ 3,715 $ 3,219 $ 3,348 $ 2,561
----------- ----------- ----------- ----------- -----------
Total nonperforming loans $ 29,767 $ 32,960 $ 33,434 $ 35,062 $ 35,358
Other real estate owned $ 6,370 $ 6,958 $ 6,255 $ 6,570 $ 8,579
Nonperforming investment securities $ - $ - $ - $ 163 $ 171
----------- ----------- ----------- ----------- -----------
Total nonperforming assets $ 36,137 $ 39,918 $ 39,689 $ 41,795 $ 44,108
Net loan charge-offs to average loans 0.89% 0.87% 0.17% 0.17% 0.16%
Allowance for losses to total loans 1.28% 1.46% 1.61% 1.62% 1.67%
Nonperforming assets to Gross Loans 3.84% 4.22% 4.20% 4.51% 4.98%
Nonperforming assets to total assets 2.33% 2.57% 2.55% 2.74% 3.12%
Allowance to nonperforming assets 33.32% 34.57% 38.26% 35.83% 33.46%
END OF PERIOD BALANCES
Loans and leases $ 940,155 $ 945,881 $ 945,591 $ 923,738 $ 882,290
Total earning assets $ 1,459,091 $ 1,465,322 $ 1,463,425 $ 1,433,115 $ 1,326,025
Total assets $ 1,551,607 $ 1,552,279 $ 1,554,321 $ 1,523,976 $ 1,412,692
Deposits $ 1,099,393 $ 1,100,711 $ 1,072,426 $ 1,038,441 $ 1,020,188
Interest Bearing Liabilities $ 1,243,904 $ 1,237,742 $ 1,242,611 $ 1,229,189 $ 1,129,500
Shareholders' equity $ 153,618 $ 155,346 $ 153,320 $ 144,393 $ 148,899
Total Shares Outstanding 17,472,389 17,465,839 17,419,910 17,417,443 17,509,817
AVERAGE BALANCES
Loans and leases $ 949,978 $ 948,628 $ 934,031 $ 905,502 $ 872,746
Total earning assets $ 1,475,802 $ 1,454,891 $ 1,444,880 $ 1,378,490 $ 1,341,444
Total assets $ 1,567,950 $ 1,538,860 $ 1,529,700 $ 1,466,359 $ 1,430,303
Deposits $ 1,117,572 $ 1,079,610 $ 1,062,755 $ 1,028,702 $ 1,029,856
Interest Bearing Liabilities $ 1,253,664 $ 1,229,373 $ 1,228,637 $ 1,172,378 $ 1,149,302
Shareholders' equity $ 155,580 $ 154,428 $ 146,579 $ 148,877 $ 145,751
MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
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QUARTER ENDED MARCH 31,
Dollars in thousands (except per share data) 2005 2004
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INTEREST INCOME
Interest and fees on loans $15,033 $13,559
Interest on investment securities-
Tax-exempt 1,258 2,840
Taxable 4,499 2,160
Interest on federal funds sold 129 1
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Total interest income 20,919 18,560
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INTEREST EXPENSE
Interest on deposits 4,920 3,239
Interest on borrowed funds 3,377 2,681
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Total interest expense 8,297 5,920
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NET INTEREST INCOME 12,622 12,640
PROVISION FOR LOAN LOSSES 600 600
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NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 12,022 12,040
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OTHER INCOME
Income from trust services 1,063 814
Service charges and other fees 1,307 1,278
Net gain (loss) on sales of securities 163 107
Origination fees on mortgage loans sold 107 160
Bank Owned Life Insurance income 274 387
Other 532 480
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Total other income 3,446 3,226
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OTHER EXPENSES
Salaries and employee benefits 4,672 4,488
Occupancy expense 949 808
Other 3,108 2,593
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Total other expenses 8,729 7,889
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INCOME BEFORE PROVISION
FOR INCOME TAXES 6,739 7,377
PROVISION FOR INCOME TAXES 1,860 1,977
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NET INCOME $ 4,879 $ 5,400
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BASIC EARNINGS PER COMMON SHARE $ 0.28 $ 0.31
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DILUTED EARNINGS PER COMMON SHARE $ 0.28 $ 0.31
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DIVIDENDS DECLARED PER COMMON SHARE $ 0.16 $ 0.15
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MBT FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS - UNAUDITED
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MARCH 31, DECEMBER 31, MARCH 31,
Dollars in thousands 2005 2004 2004
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ASSETS
Cash and Cash Equivalents
Cash and due from banks $ 21,311 $ 20,540 $ 24,342
Federal funds sold - 14,000 -
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Total cash and cash equivalents 21,311 34,540 24,342
Securities - Held to Maturity 76,430 84,141 98,119
Securities - Available for Sale 429,422 408,353 333,783
Federal Home Loan Bank stock - at cost 13,084 12,947 11,833
Loans held for sale 492 778 204
Loans - Net 927,623 931,303 867,326
Accrued interest receivable and other assets 25,164 22,895 24,070
Bank Owned Life Insurance 35,426 35,152 34,167
Premises and Equipment - Net 22,655 22,170 18,848
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Total assets $ 1,551,607 $ 1,552,279 $ 1,412,692
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LIABILITIES
Deposits:
Non-interest bearing $ 143,289 $ 149,469 $ 126,288
Interest-bearing 956,104 951,242 893,900
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Total deposits 1,099,393 1,100,711 1,020,188
Federal Home Loan Bank advances 256,500 256,500 225,000
Federal funds purchased 1,300 - 10,600
Repurchase agreements 30,000 30,000 -
Interest payable and other liabilities 10,796 9,722 8,005
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Total liabilities 1,397,989 1,396,933 1,263,793
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STOCKHOLDERS' EQUITY
Common stock (no par value) - - -
Additional paid-in capital 19,733 19,806 20,668
Retained Earnings 137,730 135,647 126,641
Accumulated other comprehensive income (3,845) (107) 1,590
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Total stockholders' equity 153,618 155,346 148,899
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Total liabilities and stockholders' equity $ 1,551,607 $ 1,552,279 $ 1,412,692
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