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NEWS RELEASE
Date: April 26, 1995
Contact: Ben Rubendall
815-961-7164
[AMCORE LOGO]
AMCORE REPORTS 1ST QUARTER EARNINGS
ROCKFORD, ILL. - AMCORE Financial, Inc. posted first quarter earnings
of $4.6 million, or 37 cents per share for the period ended March 31, 1995
compared with 38 cents for the same period in 1994.
All financial information has been restated to reflect the mergers
with First State Bancorp of Princeton, Ill., Inc., and NBA Holding Company, of
Aledo.
Net interest income for the quarter was $18 million, up 1.9 percent,
from $17.6 million in the same quarter of 1994 as a result of higher loan
volume. Average loans increased $131 million, or 14 percent and partially
offset the compression in margins caused by an increase in funding costs. The
net interest margin, however, fell 31 basis points to 4.30 percent, down from
4.61 percent in the 1994 quarter.
Fee income for the quarter was up $350,000, or 5 percent, excluding
security gains. Much of the increase was due to a 7.7 percent increase in trust
revenues. Mortgage fee income declined 28 percent and total mortgage revenues
fell $596,000. The volume of mortgage originations and refinancing has been
down since the second quarter of 1994, when interest rates rose.
Much of the decline in quarterly earnings was due to costs associated
with opening new facilities and the conversion of data processing systems,
lower mortgage revenues, and increased provisions for loan losses to adjust for
growth in the loan portfolio. The provision for loan losses for the quarter was
$300,000, up $168,000 from the first quarter of 1994.
"The northern Illinois economy is growing rapidly," Dargene said.
"Last week Rockford was listed in the top 10 in the United States in terms of
percentage increase in the value of commercial building permits issued compared
with the previous year. This type of activity has resulted in a significant
increase in business and an expansion of our loan portfolio."
Total operating expenses for the quarter were up $1.2 million, or 6.7
percent, from the 1994 quarter largely due to the branch expansion and on-going
upgrading of data processing systems. Costs associated with the opening of
seven new branches reduced quarterly earnings by approximately 2 cents per
share.
Total income taxes decreased $336,000 from the same quarter of 1994
due to federal tax credits realized and lower state income taxes.
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AMCORE Financial, Inc.
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AMCORE Financial, Inc.
First Quarter Earnings 1995
Page 2
"We are in the process of implementing several measures to increase
our operating efficiency," Dargene said. "We are merging and realigning our
smaller banking operations into larger groups, which will have economies of
scale while still keeping their local orientations. We are also in the midst
of a comprehensive upgrade of our data processing systems that will lead to
increased efficiency and allow us to offer a wider range of banking products.
"Significant revenue growth opportunities will be investigated in the
coming months," Dargene said. "For example, we are negotiating with Charles E.
Schwab & Co. to market our Vintage family of no-load mutual funds on a national
basis. The funds are now offered by specially trained personnel in our banks,
as well as in our trust and brokerage operations.
"The Vintage funds should be competitive, since Lipper Analytical
Services recently ranked our equity growth fund among the top 10
best-performing equity growth funds that they follow. The change to a national
focus in our marketing strategy should result in increased sales," Dargene
said.
"Our newly formed insurance group is growing rapidly and will be
marketing its products in all of our banking locations.
"We also will be giving increasing attention to marketing our products
in the rapidly growing Chicago Collar Counties region," Dargene said. "We
already have a significant presence in some parts of that market."
The return on assets for the quarter was .95 percent down from 1.06
percent in the same quarter of 1994, and the return on average equity was 11.13
percent, down from 11.74 percent.
AMCORE Financial, Inc. is a northern Illinois-based bank holding
company with assets of approximately $2 billion. Its holdings include seven
subsidiary banks operating in 34 locations.
The company also has seven primary financial service subsidiaries: a
trust company, a mortgage company, a full-service broker-dealer, a capital
management company, a collection agency, a consumer finance company, and an
insurance company. AMCORE common stock is listed on NASDAQ under the symbol
"AMFI".
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AMCORE FINANCIAL, INC.
CONSOLIDATED KEY FINANCIAL DATA SUMMARY
NOTE: All prior year amounts have been restated to reflect the August 1, 1994
merger with First State Bancorp of Princeton, Illinois, Inc., and the
December 19, 1994 merger with NBA Holding Company of Aledo, Illinois,
which were accounted for under the pooling of interests method.
(In thousands, except share data) QUARTER ENDED MARCH 31, TWELVE MONTHS ENDED MARCH 31,
--------------------------- ---------------------------------
PERCENT PERCENT
FINANCIAL HIGHLIGHTS 1995 1994 CHANGE 1995 1994 CHANGE
- ---------------------------------------------------- ------- ------- ------- --------- -------- --------
Net revenues, including security gains.............. $25,883 $24,956 3.7% $103,103 $101,164 1.9%
Operating expenses.................................. 19,692 18,448 6.7% 75,982 73,833 2.9%
Net income.......................................... 4,614 4,763 -3.1% 19,451 19,061 2.0%
Net income per share................................ 0.37 0.38 -2.6% 1.57 1.54 1.9%
Cash dividends per share............................ 0.15 0.135 11.1% 0.58 0.455 27.5%
Book value per share................................ 13.85 13.18 5.0%
KEY FINANCIAL RATIOS
Return on average assets......................... 0.95% 1.06% -10.4%
Return on average equity......................... 11.13% 11.74% -5.2%
Net interest margin (FTE)........................ 4.30% 4.61% -6.7%
Net operating expense/avg. assets................ 2.54% 2.55% -0.4%
Average total equity to avg. assets.............. 8.50% 9.00% -5.5%
Other income/net revenues (1).................... 28.9% 28.3% 2.2%
Efficiency Ratio (FTE)........................... 72.0% 69.6% 3.4%
INCOME STATEMENT
Interest income..................................... $35,445 $30,220 17.3%
Interest expense.................................... 17,485 12,588 38.9%
------- ------- -------
Net interest income.............................. 17,960 17,632 1.9%
Provision for loan losses........................... 296 128 131.3%
Other Income:
Trust income..................................... 2,823 2,621 7.7%
Service charges on deposits...................... 1,679 1,571 6.9%
Mortgage revenues................................ 546 759 -28.1%
Collection fee income............................ 453 452 0.2%
Other............................................ 1,803 1,550 16.3%
------- ------- -------
Total other income............................ 7,304 6,953 5.0%
Net security gains.................................. 619 371 66.8%
Operating expenses:
Personnel costs.................................. 10,813 9,909 9.1%
Net occupancy expense............................ 1,313 1,111 18.2%
Equipment expense................................ 1,548 1,413 9.6%
Insurance expense................................ 1,039 1,030 0.9%
Professional fees................................ 534 698 -23.5%
Amortization of intangible assets................ 637 639 -0.3%
Other............................................ 3,808 3,648 4.4%
------- ------- -------
Total operating expenses...................... 19,692 18,448 6.7%
------- ------- -------
Income before income taxes.......................... 5,895 6,380 -7.6%
Income taxes........................................ 1,281 1,617 -20.8%
------- ------- -------
Net income.................................... $4,614 $4,763 -3.1%
======= ======= =======
Average shares outstanding (000).................... 12,410 12,376 0.3%
Ending shares outstanding (000)..................... 12,423 12,377 0.4%
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AMCORE FINANCIAL, INC.
FIRST QUARTER FIRST QUARTER
(IN THOUSANDS) 1995 1994
---------- --------------------- --------------------
ENDING AVERAGE YIELD/ AVERAGE YIELD/
BALANCE BALANCE RATE BALANCE RATE
---------- ---------- ----- ---------- -----
Assets:
Taxable securities...................... $482,533 $479,924 6.97% $449,168 6.11%
Tax-exempt securities (FTE)............. 208,901 207,664 7.74% 214,804 7.89%
Other earning assets.................... 6,406 19,509 6.21% 27,495 4.02%
Mortgage loans held for sale............ 9,941 7,028 8.65% 13,015 7.44%
Loans, net of unearned (FTE)............ 1,107,329 1,092,730 8.69% 961,726 8.13%
---------- ---------- ----- ---------- -----
Total Earning Assets................. $1,815,110 $1,806,855 8.17% $1,666,208 7.62%
Intangible assets.................... 17,328 17,706 19,373
Other non-earning assets............. 156,714 152,044 141,836
---------- ---------- ----- ---------- -----
Total Assets......................... $1,989,152 $1,976,605 $1,827,417
========== ========== ===== ========== =====
Liabilities and Stockholders' Equity:
Interest bearing deposits............... $1,364,639 $1,322,769 4.20% $1,306,118 3.48%
Non-interest bearing deposits........... 229,416 236,901 208,572
---------- ---------- ----- ---------- -----
Total Deposits....................... $1,594,055 $1,559,670 $1,514,690
---------- ---------- ----- ---------- -----
Short-term borrowings................... 174,560 205,677 6.30% 103,528 2.99%
Long-term borrowings.................... 24,433 24,497 7.65% 29,767 6.51%
Other................................... 4,607 4,254 12.01% 3,655 11.65%
---------- ---------- ----- ---------- -----
Total Interest Bearing Liabilities... 1,568,239 1,557,197 4.55% 1,443,068 3.53%
Other liabilities.................... 19,485 14,428 11,305
---------- ---------- ----- ---------- -----
Total Liabilities.................... $1,817,140 $1,808,526 $1,662,945
Stockholders' Equity................. 172,012 168,079 164,472
---------- ---------- ----- ---------- -----
Total Liabilities and
Stockholders' Equity................. $1,989,152 $1,976,605 $1,827,417
========== ========== ===== ========== =====
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QUARTER ENDED MAR. 31,
----------------------------------
PERCENT
ASSET QUALITY (IN THOUSANDS) 1995 1994 CHANGE
------- ------- ------
Ending allowance for loan losses........... $12,712 $13,759 -7.6%
Net charge-offs............................ 204 283 -27.9%
Net charge-offs to average loans (2)....... 0.07% 0.12% -41.7%
Non-performing assets:
Nonaccrual.............................. $9,883 $10,903 -9.4%
Restructured............................ 2,050 1,036 97.9%
------- ------- ------
Non-performing loans................. 11,933 11,939 -0.1%
Other real estate owned (OREO).......... 1,084 774 40.1%
------- ------- ------
Total non-performing assets.......... $13,017 $12,713 2.4%
======= ======= ======
Key Asset Quality Ratios
Allowance to ending loans............... 1.15% 1.42% -19.1%
Allowance to non-performing loans....... 106.5% 115.2% -7.6%
Non-performing loans to loans........... 1.08% 1.23% -12.5%
Non-performing assets to loans & OREO... 1.17% 1.31% -10.4%
Capital Adequacy
Total risk-based capital................ 13.05% 12.91% 1.1%
Tier 1 risk-based capital............... 12.08% 11.77% 2.6%
Leverage ratio.......................... 8.04% 7.88% 2.0%
Footnotes:
(1) Excluding net security gains.
(2) On an annualized basis.
N/M = Not meaningful
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