1
Exhibit 99.1
NEWS RELEASE DATED 10-11-2000
For Additional Information,
Contact Robert O. Bratton,
Chief Financial Officer
(704) 721-4473
or
Jan H. Hollar,
Director of Finance
(704) 721-4467
FOR IMMEDIATE RELEASE
October 11, 2000
FIRST CHARTER ANNOUNCES
THIRD QUARTER EARNINGS
Concord, North Carolina - First Charter Corporation (NASDAQ: FCTR) reported
today that third quarter 2000 core operating earnings were $9.7 million, or
$0.31 per diluted share. Core operating earnings for the nine months ended
September 30, 2000 amounted to $28.1 million, or $0.89 per diluted share. In
comparison, third quarter 1999 core operating earnings were $8.5 million, or
$0.27 per diluted share, while core operating earnings for the nine months ended
September 30, 1999 amounted to $25.1 million, or $0.79 per diluted share.
Lawrence M. Kimbrough, President and Chief Executive Officer commented that
"Despite the market challenges of rising interest rates and the subsequent
slowing of the economy, First Charter core operating earnings for the first
three quarters increased 12.2% over the same period in 1999. Our success now and
in the future depends on our ability to broaden and deepen the relationships
with our clients, and to deliver the exceptional customer service that they
expect from us."
As we previously disclosed, during the third quarter 2000, the following
non-core earnings items occurred:
o $2.8 million after-tax ($4.1 million pre-tax) in equity investment income
from investments in venture capital funds;
o $0.4 million after-tax ($0.5 million pre-tax) gain on the sale of property
related to the sale of four branch facilities which were sold as a result
of the Carolina First BancShares merger;
o $1.9 million after-tax ($2.9 million pre-tax) loss associated with the
restructuring of the available-for-sale securities portfolio;
o $0.4 million after-tax ($0.6 million pre-tax) loss associated with the
writedown of certain equity securities due to other-than-temporary
impairment in value; and
o $0.6 million after-tax ($0.9 million pre-tax) incremental provision for
loan losses to reflect the current risk profile of the loan portfolio.
2
Third quarter 2000 net income including these items amounted to $9.9 million, or
$0.31 diluted net income per share. Management believes that fourth quarter core
operating earnings will be consistent with the third quarter core operating
earnings.
During third quarter 1999, a $1.2 million after-tax ($1.8 million pre-tax)
non-core earnings gain on the sale of property occurred. Third quarter 1999 net
income including this item amounted to $9.8 million, or $0.31 diluted net income
per share.
In addition, during the nine months ended September 30, 2000, the following
non-core earnings items occurred:
o $12.0 million after-tax ($16.3 million pre-tax) merger and restructuring
charge primarily associated with the merger of Carolina First BancShares;
o $3.1 million after-tax ($4.6 million pre-tax) in equity investment income
from investments in venture capital funds;
o $0.4 million after-tax ($0.5 million pre-tax) gain on sale of property
related to the sale of four branch facilities related to the Carolina First
BancShares merger;
o $1.9 million after-tax ($2.9 million pre-tax) loss associated with the
restructuring of the available-for-sale securities portfolio;
o $1.0 million after-tax ($1.4 million pre-tax) loss associated with the
writedown of certain equity securities due to other-than-temporary
impairment in value;
o $0.1 million after-tax ($0.1 million pre-tax) loss associated with the sale
of mortgage loans; and
o $0.6 million after-tax ($0.9 million pre-tax) incremental provision for
loan losses to reflect the current risk profile of the loan portfolio.
For the nine months ended September 30, 2000 net income including these items
amounted to $15.7 million, or $0.50 diluted net income per share.
During the nine months ended September 30, 1999, the following non-core earnings
items occurred:
o $1.1 million after-tax ($1.8 million pre-tax) gain associated
with the sale of mortgage loans;
o $0.1 million after-tax ($0.1 million pre-tax) in equity investment income
from investments in venture capital funds; and
o $1.1 million after-tax ($1.8 million pre-tax) gain associated with the sale
of property.
Including these items, net income for the nine month period ended September 30,
1999 amounted to $27.4 million or $0.86 diluted net income per share.
NET INTEREST INCOME
Net interest income increased 1.6% and 5.0% to $26.7 million and $80.9 million
for the three months and nine months ended September 30, 2000, respectively.
This is compared to net interest income of $26.3 million and $77.0 million for
the three months and nine months ended September 30, 1999. These increases were
driven primarily by loan growth and offset by continued increases in the cost of
funding. Further compression of the net interest margin was experienced during
the third quarter of 2000, with the net interest margin decreasing from 4.30%
for the quarter ended June 30, 2000 to 4.19% for the quarter ended September 30,
2000.
3
NONINTEREST INCOME
Core operating noninterest income for the third quarter of 2000 totaled $6.5
million compared to $6.2 million for the same period in 1999. Core operating
noninterest income for the nine months ended September 30, 2000 totaled $22.0
million, an increase of 16.1% compared to the same period in 1999. These
increases were driven primarily by increases in service charge income on deposit
accounts as well as continued growth from First Charter Insurance Services.
NONINTEREST EXPENSE
Noninterest expense for the third quarter of 2000 totaled $17.8 million compared
to $19.1 million for the same period in 1999. This decrease was primarily the
result of synergies realized as a result of the Carolina First BancShares
merger. Core operating noninterest expense for the nine months ended September
30, 2000 totaled $57.0 million compared to $55.7 million for the same period in
1999.
BALANCE SHEET
Total assets at September 30, 2000 amounted to $2.79 billion, compared to $2.68
billion and $2.59 billion at December 31, 1999 and September 30, 1999,
respectively. Net loans at September 30, 2000 amounted to $2.08 billion,
compared to $1.94 billion and $1.87 billion at December 31, 1999 and September
30, 1999, respectively. This increase from prior periods is due primarily to
commercial loan growth and is offset by the sale of $45.3 million in
lower-yielding mortgage loans during the second quarter of 2000.
Total deposits at September 30, 2000 amounted to $1.92 billion, compared to
$1.82 billion and $1.80 billion at December 31, 1999 and September 30, 1999,
respectively. Shareholders' equity at September 30, 2000 was $300.0 million,
which represents a book value per share of $9.52 and an equity-to-assets
percentage of 10.76%. Based on the $14.4375 closing price of First Charter
Corporation common stock at September 30, 2000, the Corporation had a market
capitalization of $455.1 million.
ASSET QUALITY
The provision for loan losses for the three months and nine months ended
September 30, 2000 amounted to $2.2 million and $5.5 million, respectively. This
is compared to provision for loan losses of $0.8 million and $3.8 million for
the same periods in 1999. The increase in the provision over prior year levels
was due to: (i) loan growth primarily in the commercial portfolio; (ii)
increases in net charge-offs; and (iii) increases in nonperforming assets.
The total of nonperforming assets and loans 90 days or more past due and still
accruing at September 30, 2000 increased to $30.0 million compared to $16.3
million and $15.6 million at December 31, 1999 and September 30, 1999,
respectively. As a percentage of total assets, nonperforming assets have
increased to 1.08% at September 30, 2000 compared to 0.61% and 0.60% at December
31, 1999 and September 30, 1999, respectively. Net loan charge-offs as a
percentage of average gross loans increased to 0.17% (annualized) for the nine
months ended September 30, 2000 as compared to 0.10% for the year ended December
31, 1999, and 0.11% (annualized) for the nine months ended September 30, 1999.
These increases were primarily due to the effect of higher interest rates and
slower economic growth on some customers. At September 30, 2000 the allowance
for loan losses as a percentage of gross loans was 1.32% compared to 1.27% at
both December 31, 1999 and September 30, 1999.
4
CONFERENCE CALL
First Charter executive management will be available via telephone to discuss
the issues related to the contents of this press release on Wednesday, October
11, 2000 at 11:00 a.m. To participate in this conference call, dial 888-404-8794
and use conference code # 7047214460.
(SELECTED FINANCIAL INFORMATION IS ATTACHED)
CORPORATE PROFILE
First Charter Corporation is the holding company for First Charter National
Bank. First Charter is a regional financial services company with assets of
$2.79 billion that operates 50 financial centers and 85 ATMs located in 14
counties throughout North Carolina. First Charter provides businesses and
individuals with a broad range of financial services, including banking,
comprehensive financial planning, funds management, investments, insurance,
mortgages and a full array of employee benefit programs. Additional information
about First Charter can be found by visiting www.FirstCharter.com or by calling
1-800-601-8471. Common stock for First Charter is traded under the symbol "FCTR"
on The NASDAQ National Market.
The First Charter Corporation acquisition of Carolina First BancShares, Inc. was
completed during the second quarter of 2000 and was accounted for as a pooling
of interests. Accordingly, all financial results for prior periods have been
restated to combine the results of Carolina First BancShares, Inc. with those of
First Charter Corporation. In addition, effective September 1, 2000, Business
Insurer Services of Guilford County, known as Business Insurers, was merged into
First Charter Insurance Services and that acquisition was accounted for as a
pooling of interests. Accordingly, all financial results for prior periods have
been restated to combine the results of Business Insurers with those of First
Charter Corporation.
This news release contains forward-looking statements. Such statements are
subject to certain factors that may cause the company's results to vary from
those expected. These factors include changing economic and financial market
conditions, competition, ability to execute our business plan, items already
mentioned in this press release, and other factors described in our filings with
the Securities and Exchange Commission. Readers are cautioned not to place undue
reliance on these forward-looking statements, which reflect management's
judgment only as of the date hereof. The company undertakes no obligation to
publicly revise these forward-looking statements to reflect events and
circumstances that arise after the date hereof.
5
FIRST CHARTER CORPORATION AND SUBSIDIARIES (NASDAQ: FCTR)
QUARTERLY EARNINGS RELEASE
For the Three Months Ended Increase (Decrease)
----------------------------------------------------------------
(Dollars in thousands, except per share data) 9/30/2000 9/30/1999 Amount Percentage
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME STATEMENT
Interest income - taxable equivalent $ 55,215 $ 48,707 $ 6,508 13.4 %
Interest expense 28,065 22,000 6,065 27.6
----------------------------------------------------------------
Net interest income - taxable equivalent 27,150 26,707 443 1.7
Less: Taxable equivalent adjustment 476 455 21 4.6
----------------------------------------------------------------
Net interest income 26,674 26,252 422 1.6
Provision for loan losses 2,200 815 1,385 169.9
----------------------------------------------------------------
Net interest income after provision for loan losses 24,474 25,437 (963) (3.8)
Noninterest income 7,686 8,057 (371) (4.6)
Noninterest expense 17,757 19,065 (1,308) (6.9)
----------------------------------------------------------------
Income before income taxes 14,403 14,429 (26) (0.2)
Income taxes 4,464 4,678 (214) (4.6)
----------------------------------------------------------------
NET INCOME $ 9,939 $ 9,751 $ 188 1.9 %
================================================================
- ---------------------------------------------------------------------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 0.32 $ 0.31 $ 0.01 3.2 %
Diluted 0.31 0.31 -- --
Weighted average shares - basic 31,503,251 31,159,716
Weighted average shares - diluted 31,646,483 31,442,540
Dividends paid on common shares $ 0.18 $ 0.17 $ 0.01 5.9 %
- ---------------------------------------------------------------------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average assets 1.43 % 1.51 %
Return on average equity 13.31 13.68
- ---------------------------------------------------------------------------------------------------------------------------------
For the Three Months Ended Increase (Decrease)
----------------------------------------------------------------
(Dollars in thousands, except per share data) 9/30/2000 9/30/1999 Amount Percentage
- ---------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING EARNINGS
Interest income - taxable equivalent $ 55,215 $ 48,707 $ 6,508 13.4 %
Interest expense 28,065 22,000 6,065 27.6
----------------------------------------------------------------
Net interest income - taxable equivalent 27,150 26,707 443 1.7
Less: Taxable equivalent adjustment 476 455 21 4.6
----------------------------------------------------------------
Net interest income 26,674 26,252 422 1.6
Provision for loan losses 1,325 815 510 62.6
----------------------------------------------------------------
Net interest income after provision for loan losses 25,349 25,437 (88) (0.3)
Noninterest income 6,478 6,167 311 5.0
Noninterest expense 17,757 19,065 (1,308) (6.9)
----------------------------------------------------------------
Income before income taxes 14,070 12,539 1,531 12.2
Income taxes 4,359 4,017 342 8.5
----------------------------------------------------------------
Core operating income 9,711 8,522 1,189 14.0
Other non-core items, net of tax 228 1,229 (1,001) (81.4)
----------------------------------------------------------------
NET INCOME $ 9,939 $ 9,751 $ 188 1.9 %
================================================================
- ---------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING EARNINGS PER SHARE DATA
Basic $ 0.31 $ 0.27 $ 0.04 14.8 %
Diluted 0.31 0.27 0.04 14.8
Weighted average shares - basic 31,503,251 31,159,716
Weighted average shares - diluted 31,646,483 31,442,540
Dividends paid on common shares $ 0.18 $ 0.17 $ 0.01 5.9 %
- ---------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING PERFORMANCE RATIOS
Return on average assets 1.39 % 1.32 %
Return on average equity 13.00 11.96
Efficiency - taxable equivalent (*) 52.66 58.28
- ---------------------------------------------------------------------------------------------------------------------------------
For the Three Months Ended
-----------------------------------
9/30/2000 9/30/1999
-----------------------------------
SCHEDULE OF OTHER NON-CORE ITEMS
Provision for loan losses $ (875) $ --
Noninterest income
Fixed income portfolio restructuring loss (2,854) --
Equity investment stock write down (571) --
Equity investment income 4,106 138
Gain on sale of properties 527 1,752
---------------------------------
Total other items $ 333 $ 1,890
=================================
Other non-core items, net of tax $ 228 $ 1,229
=================================
- ---------------------------------------------------------------------------------------------------------------------------------
Notes: Applicable ratios are annualized.
* - Core operating noninterest expense less foreclosed property
expense divided by the sum of taxable equivalent net interest
income plus core operating noninterest income less core gain on
sale of securities.
n/m = not meaningful
5
6
FIRST CHARTER CORPORATION AND SUBSIDIARIES (NASDAQ: FCTR)
QUARTERLY EARNINGS RELEASE
For the Nine Months Ended Increase (Decrease)
----------------------------------------------------------------
(Dollars in thousands, except per share data) 9/30/2000 9/30/1999 Amount Percentage
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME STATEMENT
Interest income - taxable equivalent $ 161,127 $ 145,354 $ 15,774 10.9 %
Interest expense 78,863 67,073 11,790 17.6
----------------------------------------------------------------
Net interest income - taxable equivalent 82,264 78,281 3,984 5.1
Less: Taxable equivalent adjustment 1,407 1,306 102 7.8
----------------------------------------------------------------
Net interest income 80,857 76,975 3,882 5.0
Provision for loan losses 5,540 3,770 1,770 46.9
----------------------------------------------------------------
Net interest income after provision for loan losses 75,317 73,205 2,112 2.9
Noninterest income 22,774 22,604 170 0.8
Noninterest expense 73,258 55,729 17,529 31.5
----------------------------------------------------------------
Income before income taxes 24,833 40,080 (15,247) (38.0)
Income taxes 9,089 12,653 (3,564) (28.2)
----------------------------------------------------------------
NET INCOME $ 15,744 $ 27,427 $ (11,683) (42.6)%
================================================================
- ---------------------------------------------------------------------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 0.50 $ 0.87 $ (0.37) (42.5)%
Diluted 0.50 0.86 (0.36) (41.9)
Weighted average shares - basic 31,384,049 31,649,358
Weighted average shares - diluted 31,544,011 31,902,447
Dividends paid on common shares $ 0.52 $ 0.51 $ 0.01 2.0 %
- ---------------------------------------------------------------------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average assets 0.77 % 1.43 %
Return on average equity 7.61 12.40
- ---------------------------------------------------------------------------------------------------------------------------------
For the Nine Months Ended Increase (Decrease)
----------------------------------------------------------------
(Dollars in thousands, except per share data) 9/30/2000 9/30/1999 Amount Percentage
- ---------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING EARNINGS
Interest income - taxable equivalent $ 161,127 $ 145,354 $ 15,774 10.9 %
Interest expense 78,863 67,073 11,790 17.6
----------------------------------------------------------------
Net interest income - taxable equivalent 82,264 78,281 3,984 5.1
Less: Taxable equivalent adjustment 1,407 1,306 102 7.8
----------------------------------------------------------------
Net interest income 80,857 76,975 3,882 5.0
Provision for loan losses 4,665 3,770 895 23.7
----------------------------------------------------------------
Net interest income after provision for loan losses 76,192 73,205 2,987 4.1
Noninterest income 22,018 18,957 3,061 16.1
Noninterest expense 57,008 55,729 1,279 2.3
----------------------------------------------------------------
Income before income taxes 41,202 36,433 4,769 13.1
Income taxes 13,091 11,377 1,714 15.1
----------------------------------------------------------------
Core operating income 28,111 25,056 3,055 12.2
Other non-core items, net of tax (12,367) 2,371 (14,738) (621.6)
----------------------------------------------------------------
NET INCOME $ 15,744 $ 27,427 $ (11,683) (42.6)%
----------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING EARNINGS PER SHARE DATA
Basic $ 0.90 $ 0.79 $ 0.11 13.9 %
Diluted 0.89 0.79 0.10 12.7
Weighted average shares - basic 31,384,049 31,649,358
Weighted average shares - diluted 31,544,011 31,902,447
Dividends paid on common shares $ 0.52 $ 0.51 $ 0.01 2.0 %
- ---------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING PERFORMANCE RATIOS
Return on average assets 1.37 % 1.30 %
Return on average equity 13.58 11.33
Efficiency - taxable equivalent (*) 55.07 57.83
- ---------------------------------------------------------------------------------------------------------------------------------
For the Nine Months Ended
-----------------------------------
9/30/2000 9/30/1999
-----------------------------------
SCHEDULE OF OTHER NON-CORE ITEMS
Provision for loan losses $ (875) $ --
Noninterest income
Gain (loss) on sale of loans (99) 1,757
Fixed income portfolio restructuring loss (2,854) --
Equity investment stock write down (1,370) --
Equity investment income 4,552 138
Gain on sale of property 527 1,752
Merger and restructuring charges (16,250) --
---------------------------------
Total other items $ (16,369) $ 3,647
=================================
Other non-core items, net of tax $ (12,367) $ 2,371
=================================
- ---------------------------------------------------------------------------------------------------------------------------------
Notes: Applicable ratios are annualized.
* - Core operating noninterest expense less foreclosed property
expense divided by the sum of taxable equivalent net interest
income plus core operating noninterest income less core gain on
sale of securities.
n/m = not meaningful
6
7
FIRST CHARTER CORPORATION AND SUBSIDIARIES (NASDAQ: FCTR)
QUARTERLY EARNINGS RELEASE
As of / For the Nine Months Ended Increase (Decrease)
--------------------------------------------------------------
(Dollars in thousands, except per share data) 9/30/2000 9/30/1999 Amount Percentage
- ---------------------------------------------------------------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due from banks $ 72,876 $ 66,498 $ 6,378 9.6 %
Federal funds sold 1,020 -- 1,020 n/m
Interest earning bank deposits 5,461 5,404 57 1.1
Securities held to maturity -- 37,462 (37,462) (100.0)
Securities available for sale 474,077 506,669 (32,592) (6.4)
Loans
Commercial 1,094,170 916,927 177,243 19.3
Real estate 741,479 758,094 (16,615) (2.2)
Home equity 169,622 122,134 47,488 38.9
Installment 106,158 101,864 4,294 4.2
--------------------------------------------------------------
Total loans 2,111,428 1,899,019 212,409 11.2
Less: Unearned income (284) (229) (55) 24.0
Allowance for loan losses (27,861) (24,174) (3,687) 15.3
--------------------------------------------------------------
Loans, net 2,083,283 1,874,616 208,667 11.1
--------------------------------------------------------------
Other assets 151,238 102,487 48,751 47.6
--------------------------------------------------------------
Total assets $ 2,787,955 $ 2,593,136 $ 194,819 7.5 %
==============================================================
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits
Noninterest-bearing deposits $ 279,765 $ 224,150 $ 55,615 24.8 %
Interest checking and savings 357,739 447,078 (89,339) (20.0)
Money market deposits 223,508 232,041 (8,533) (3.7)
Time deposits 1,061,428 894,655 166,773 18.6
--------------------------------------------------------------
Total deposits 1,922,440 1,797,924 124,516 6.9
Other borrowings 519,762 469,043 50,719 10.8
Other liabilities 45,755 34,598 11,157 32.2
--------------------------------------------------------------
Total liabilities 2,487,957 2,301,565 186,392 8.1
--------------------------------------------------------------
Total shareholders' equity 299,998 291,571 8,427 2.9
--------------------------------------------------------------
Total liabilities and shareholders' equity $ 2,787,955 $ 2,593,136 $ 194,819 7.5 %
==============================================================
- ---------------------------------------------------------------------------------------------------------------------------
SELECTED AVERAGE BALANCES
Loans $ 2,055,665 $ 1,880,492 $ 175,173 9.3 %
Securities 499,615 522,015 (22,400) (4.3)
Interest earning assets 2,560,034 2,420,506 139,528 5.8
Assets 2,745,504 2,570,946 174,558 6.8
Deposits 1,629,098 1,571,761 57,337 3.6
Interest bearing liabilities 2,160,051 2,006,298 153,753 7.7
Shareholders' equity 276,497 295,490 (18,993) (6.4)
- ---------------------------------------------------------------------------------------------------------------------------
As of / For the Quarter Ended
-------------------------------------------------------------------------------
9/30/2000 6/30/20000 3/31/2000 12/31/1999 9/30/1999
-------------------------------------------------------------------------------
MISCELLANEOUS INFORMATION
Common stock prices (daily close)
High $ 16.88 $ 17.50 $ 14.63 $ 19.63 $ 24.88
Low 13.63 12.50 12.50 14.00 17.13
End of period 14.44 15.75 13.00 14.88 17.50
Book Value 9.52 9.19 9.52 9.33 9.39
Market Capitalization 455,094,957 494,695,987 407,094,792 462,617,111 543,521,405
Weighted average shares - basic 31,503,251 31,402,488 31,245,099 31,075,453 31,159,716
Weighted average shares - diluted 31,646,483 31,584,528 31,399,895 31,315,720 31,442,540
End of period shares outstanding 31,520,637 31,409,269 31,314,984 31,100,310 31,058,366
- ---------------------------------------------------------------------------------------------------------------------------
n/m = not meaningful
7
8
FIRST CHARTER CORPORATION AND SUBSIDIARIES (NASDAQ: FCTR)
QUARTERLY EARNINGS RELEASE
As of / For the Quarter Ended
-----------------------------------------------------------------------------
(Dollars in thousands, except per share data) 9/30/2000 6/30/2000 3/31/2000 12/31/1999 9/30/1999
- --------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING EARNINGS
INTEREST INCOME - TAXABLE EQUIVALENT
Interest and fees on loans $ 47,113 $ 45,277 $ 43,478 $ 42,196 $ 40,253
Interest on securities 8,036 8,389 8,474 8,416 8,375
Other interest income 66 167 127 116 79
-----------------------------------------------------------------------------
Total interest income - taxable equivalent 55,215 53,833 52,079 50,728 48,707
-----------------------------------------------------------------------------
INTEREST EXPENSE
Interest on deposits 19,461 17,413 16,852 16,591 16,178
Other interest expense 8,604 8,786 7,747 6,636 5,822
-----------------------------------------------------------------------------
Total interest expense 28,065 26,199 24,599 23,227 22,000
-----------------------------------------------------------------------------
Net interest income - taxable equivalent 27,150 27,634 27,480 27,501 26,707
Less: Taxable equivalent adjustment 476 490 441 505 455
-----------------------------------------------------------------------------
NET INTEREST INCOME 26,674 27,144 27,039 26,996 26,252
Provision for loan losses 1,325 1,370 1,970 1,235 815
-----------------------------------------------------------------------------
NET INTEREST INCOME AFTER PROVISION FOR
LOAN LOSSES 25,349 25,774 25,069 25,761 25,437
-----------------------------------------------------------------------------
NONINTEREST INCOME
Service charges on deposit accounts 2,710 3,091 2,551 2,702 2,209
Insurance and other fee income 2,412 2,248 2,560 1,967 2,055
Trust income 832 698 680 689 654
(Loss) gain on sale of securities -- 559 652 104 223
Other noninterest income 524 1,169 1,332 769 1,026
-----------------------------------------------------------------------------
Total noninterest income 6,478 7,765 7,775 6,231 6,167
-----------------------------------------------------------------------------
NONINTEREST EXPENSE
Salaries and employee benefits 9,521 10,433 10,628 10,600 10,142
Occupancy and equipment 2,898 3,171 3,082 2,877 2,950
Other noninterest expense 5,338 5,816 6,121 6,785 5,973
-----------------------------------------------------------------------------
Total noninterest expense 17,757 19,420 19,831 20,262 19,065
-----------------------------------------------------------------------------
Core operating earnings before taxes 14,070 14,119 13,013 11,730 12,539
Income taxes 4,359 4,630 4,102 3,824 4,017
-----------------------------------------------------------------------------
CORE OPERATING EARNINGS, NET $ 9,711 $ 9,489 $ 8,911 $ 7,906 $ 8,522
=============================================================================
- --------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING EARNINGS PER SHARE DATA
Basic $ 0.31 $ 0.30 $ 0.29 $ 0.25 $ 0.27
Diluted 0.31 0.30 0.28 0.25 0.27
Dividends paid on common shares 0.18 0.17 0.17 0.17 0.17
- --------------------------------------------------------------------------------------------------------------------------------
CORE OPERATING RATIOS
Return on average assets 1.39 % 1.38 % 1.33 % 1.20 % 1.32 %
Return on average equity 13.00 12.58 12.17 11.04 11.96
Efficiency - taxable equivalent (*) 52.66 55.31 57.17 60.25 58.28
Noninterest income as a percentage of
total income 19.54 22.24 22.33 18.75 19.03
Equity as a percentage of total assets 10.76 10.35 10.82 10.83 11.24
Average earning assets as a percentage of
average total assets 92.99 93.04 93.72 94.11 94.32
Average loans as a percentage of average
deposits 112.18 111.69 109.69 122.31 118.43
- --------------------------------------------------------------------------------------------------------------------------------
Notes: Applicable ratios are annualized.
* - Core operating noninterest expense less foreclosed property
expense divided by the sum of taxable equivalent net interest
income plus core operating noninterest income less core gain on
sale of securities.
n/m = not meaningful
8
9
FIRST CHARTER CORPORATION AND SUBSIDIARIES (NASDAQ: FCTR)
QUARTERLY EARNINGS RELEASE
As of / For the Quarter Ended
-----------------------------------------------------------------------------
(Dollars in thousands, except per share data) 9/30/2000 6/30/2000 3/31/2000 12/31/1999 9/30/1999
- --------------------------------------------------------------------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due from banks $ 72,876 $ 72,299 $ 84,712 $ 94,568 $ 66,498
Federal funds sold 1,020 1,658 624 665 --
Interest earning bank deposits 5,461 8,196 3,284 2,435 5,404
Securities held to maturity -- -- 35,324 36,082 37,462
Securities available for sale 474,077 500,310 476,017 487,435 506,669
Loans
Commercial 1,094,170 1,097,377 1,033,059 966,957 916,927
Real estate 741,479 722,512 759,502 754,708 758,094
Home equity 169,622 159,909 148,253 136,569 122,134
Installment 106,158 109,728 111,006 109,843 101,864
-----------------------------------------------------------------------------
Total loans 2,111,428 2,089,526 2,051,820 1,968,077 1,899,019
Less: Unearned income (284) (152) (164) (204) (229)
Allowance for loan losses (27,861) (26,700) (25,979) (25,002) (24,174)
-----------------------------------------------------------------------------
Loans, net 2,083,283 2,062,674 2,025,677 1,942,871 1,874,616
-----------------------------------------------------------------------------
Other assets 151,238 143,289 128,540 115,672 102,487
-----------------------------------------------------------------------------
Total assets $ 2,787,955 $ 2,788,426 $ 2,754,178 $ 2,679,728 $ 2,593,136
=============================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits
Noninterest-bearing deposits $ 279,765 $ 252,595 $ 239,645 $ 228,030 $ 224,150
Interest checking and savings 357,739 396,147 439,575 444,481 447,078
Money market deposits 223,508 229,594 244,793 235,728 232,041
Time deposits 1,061,428 992,622 932,167 908,252 894,655
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Total deposits 1,922,440 1,870,958 1,856,180 1,816,491 1,797,924
Other borrowings 519,762 584,144 567,536 542,021 469,043
Other liabilities 45,755 44,609 32,485 30,948 34,598
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Total liabilities 2,487,957 2,499,711 2,456,201 2,389,460 2,301,565
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Total shareholders' equity 299,998 288,715 297,977 290,268 291,571
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Total liabilities and shareholders' equity $ 2,787,955 $ 2,788,426 $ 2,754,178 $ 2,679,728 $ 2,593,136
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SELECTED AVERAGE BALANCES
Loans $ 2,099,692 $ 2,068,958 $ 1,997,860 $ 1,930,497 $ 1,867,338
Securities 475,630 509,977 513,501 534,083 537,011
Interest earning assets 2,578,374 2,582,473 2,519,053 2,468,323 2,409,088
Assets 2,772,859 2,775,567 2,687,784 2,622,856 2,554,120
Deposits 1,871,707 1,852,470 1,821,291 1,578,368 1,576,808
Interest bearing liabilities 2,192,605 2,196,884 2,139,254 2,061,485 2,014,399
Shareholders' equity 297,132 303,277 294,442 284,145 282,779
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FIRST CHARTER CORPORATION AND SUBSIDIARIES (NASDAQ: FCTR)
QUARTERLY EARNINGS RELEASE
As of / For the Quarter Ended
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(Dollars in thousands, except per share data) 9/30/2000 6/30/2000 3/31/2000 12/31/1999 9/30/1999
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ASSET QUALITY ANALYSIS
ALLOWANCE FOR LOAN LOSSES
Beginning balance $ 26,700 $ 25,979 $ 25,002 $ 24,174 $ 23,745
Provision for loan losses 2,200 1,370 1,970 1,235 815
Allowance related to loans sold -- (113) -- -- --
Charge-offs (1,440) (705) (1,275) (611) (606)
Recoveries 401 169 282 204 220
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Net charge-offs (1,039) (536) (993) (407) (386)
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Ending balance $ 27,861 $ 26,700 $ 25,979 $ 25,002 $ 24,174
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NONPERFORMING ASSETS AND LOANS 90 DAYS
OR MORE PAST DUE ACCRUING
Nonaccrual loans $ 26,281 $ 13,538 $ 9,513 $ 10,353 $ 8,850
Restructured loans -- -- -- 37 389
Other real estate 3,005 3,381 2,066 2,262 2,063
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Total nonperforming assets 29,286 16,919 11,579 12,652 11,302
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Loans 90 days or more past due accruing
interest 716 2,645 3,559 3,638 4,284
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TOTAL $ 30,002 $ 19,564 $ 15,138 $ 16,290 $ 15,586
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ASSET QUALITY RATIOS
Nonaccrual loans as a percentage of
total loans 1.24 % 0.65 % 0.46 % 0.53 % 0.47 %
Nonperforming assets as a percentage of
total assets 1.08 0.70 0.55 0.61 0.60
Nonperforming assets as a percentage of
total loans 1.42 0.94 0.74 0.83 0.82
Net charge-offs as a percentage of
average loans (annualized) 0.20 0.10 0.20 0.08 0.08
Allowance for loan losses as a
percentage of loans 1.32 1.28 1.27 1.27 1.27
Ratio of allowance for loan losses to:
Net charge-offs 6.74 x 12.39 x 6.50 x 15.48 x 15.79 x
Nonaccrual loans 1.06 1.97 2.73 2.41 2.73
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As of / For the
Nine Months Ended Increase (Decrease)
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9/30/2000 9/30/1999 Amount Percentage
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ALLOWANCE FOR LOAN LOSSES
Beginning balance $ 25,002 $ 22,278 $ 2,724 12.2 %
Provision for loan losses 5,540 3,770 1,770 46.9
Allowance related to loans sold (113) (369) 256 (69.4)
Charge-offs (3,420) (2,161) (1,259) 58.3
Recoveries 852 656 196 29.9
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Net charge-offs (2,568) (1,505) (1,063) 70.6
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Ending balance $ 27,861 $ 24,174 $ 3,687 15.3 %
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ASSET QUALITY RATIOS
Net charge-offs as a percentage of average loans (annualized) 0.17 % 0.11 %
Ratio of allowance for loan losses to net charge-offs 8.12 x 12.01 x
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For the Quarter Ended
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9/30/2000 6/30/2000 3/31/2000 12/31/1999 9/30/1999
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ANNUALIZED INTEREST YIELDS / RATES (*)
INTEREST INCOME:
Yield on loans 8.93 % 8.80 % 8.75 % 8.67 % 8.55 %
Yield on securities 6.72 6.62 6.64 6.25 6.19
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Yield on interest earning assets 8.52 8.38 8.32 8.15 8.02
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INTEREST EXPENSE:
Cost of interest bearing deposits 4.75 4.36 4.27 4.17 4.07
Cost of borrowings 6.08 6.00 5.64 5.45 5.28
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Cost of interest bearing liabilities 5.09 4.80 4.62 4.47 4.33
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Interest rate spread 3.43 3.58 3.69 3.68 3.69
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Net yield on earning assets 4.19 % 4.30 % 4.39 % 4.42 % 4.40 %
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Notes: Applicable ratios are annualized.
* - Fully taxable equivalent yields.
n/m = not meaningful
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