Exhibit 99.1
HORIZON
BANKING o INSURANCE o INVESTMENTS o TRUST
515 Franklin Square, Michigan City, Indiana
Contact: James H. Foglesong
Chief Financial Officer
Phone: (219) 873-2608
Fax: (219) 874-9280
Date: April 17, 2003
FOR IMMEDIATE RELEASE
HORIZON BANCORP ANNOUNCES 56% INCREASE IN FIRST QUARTER EARNINGS
Michigan City, Indiana, (April 17, 2003) - Horizon Bancorp today announced
unaudited financial results for the quarter ended March 31, 2003. Net income was
$1.724 million or $.84 per fully diluted share. This compares to net income of
$1.105 million or $.56 per fully diluted share for the same quarter of the prior
year. This represents a 56% increase over the first quarter of the prior year.
The first quarter of the prior year included a $97 thousand net of tax, or $.05
per fully diluted share charge for the cumulative effect of a change in
accounting for goodwill. Craig M. Dwight, Chief Executive Officer stated, "I am
proud of the entire Horizon Team in reaching a new milestone for record
quarterly earnings. This team is constantly looking at ways to balance the
interests of customers, shareholders and the communities we serve, and the
results over this past quarter provides considerable evidence of their
commitment to excellence."
Net interest income for the quarter ended March 31, 2003 was $5.885 million, an
increase of $630 thousand or 12% over the same period of the prior year. This
increase was the result of an increase in average earning assets over the first
quarter of 2002 of approximately $146 million. This growth came primarily in the
investment portfolio and mortgage warehouse loans. Mortgage warehouse loans
experienced unprecedented growth over the last six months due to heavy refinance
activity. As is typical in any economic cycle, mortgage lending activity will
eventually decline. Management plans to offset this decline by focusing on
business and consumer lending activities, as well as expanding into new markets.
Mortgage warehouse loans outstanding averaged $237.5 million during the first
quarter of 2003 compared to $179.0 million for the same quarter of the prior
year.
Non-interest income increased $557 thousand or 25% from the first quarter of
2002. This increase relates primarily to an increased gain on the sale of loans
into the secondary market. During the first quarter of 2003, the gain on sale of
mortgage loans totaled $1.021 million based on the sale of approximately $51.4
million of mortgage loans. This compares to a gain of $525 thousand based on the
sale of approximately $30.7 million in the first quarter of 2002.
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Pg. 2 Cont. Horizon First Quarter Earnings
Non-interest expense increased $539 thousand or 10% from the first quarter of
2002. The majority of the increase relates to salaries and employee benefits
which increased due to additional commissions paid to mortgage loan originators
and additional staffing for new market expansion.
At March 31, 2003, Horizon's total assets were $698 million compared to $720
million at December 31, 2002. Total net loans were $492 million at March 31,
2003 compared to $530 million at December 31, 2002. The decline in loans came
primarily in mortgage warehouse loans, as mentioned above. Refinance activity,
while still strong, slowed somewhat in the first quarter and, accordingly,
mortgage warehouse loans outstanding have declined approximately $32 million
since December 31, 2002.
Horizon's allowance for loan losses at March 31, 2003 was $6.5 million, or 1.30%
of gross loans, compared to $6.3 million or 1.17% at December 31, 2002.
Non-performing assets at March 31, 2003 were $1.1 million, or 0.22% of gross
loans, compared to $1.3 million or .24% at December 31, 2002.
Total deposits were $479 million at March 31, 2003 compared to $489 million at
December 31, 2002. The decline came primarily in public funds and other short
term negotiable Certificates of Deposit brought in to fund the fourth quarter
growth in mortgage warehouse loans. Core deposits increased to $354.1 million at
March 31, 2003, from $344.2 million at December 31, 2002.
Book value per common share at March 31, 2003 was $21.51 compared to $20.89 at
December 31, 2002. The change in stockholders' equity during the three months
ended March 31, 2003 is the result of net income, net of dividends declared, and
a decrease in the market value of investment securities available for sale.
Horizon Bancorp is a locally owned, independent, bank holding company serving
the Northwestern Indiana/Southwestern Michigan area. It offers banking,
insurance, investment and trust services from offices located in Michigan City,
LaPorte, Wanatah, Chesterton, Portage, Valparaiso and Merrillville, Indiana, and
provides mortgage-banking services throughout the Midwest. Horizon Bancorp may
be reached on the World Wide Web at www.accesshorizon.com. Its common stock is
traded on the NASDAQ SmallCap Market under the symbol HBNC.
Statements in this press release which express "belief," "intention,"
"expectation," and similar expressions, identify forward-looking statements.
Such forward-looking statements are based on the beliefs of the Company's
management, as well as assumptions made by, and information currently available
to, such management. Such statements are inherently uncertain and there can be
no assurance that the underlying assumptions will prove to be valid. Actual
results could differ materially from those contemplated by the forward-looking
statements. Any forward-looking statements in this release are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995.
Contact: Horizon Bancorp
James H. Foglesong
Chief Financial Officer
(219) 873 - 2608
Fax: (219) 874 -9280
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HORIZON BANCORP
(in thousands except per share data and ratios)
At At
March 31, December 31,
2003 2002
--------- ------------
SELECTED FINANCIAL DATA:
Total assets $ 697,681 $ 720,130
Cash and cash equivalents 24,857 35,692
Investment securities available for sale 145,335 109,453
Loans held for sale 3,841 12,620
Loans, net 491,573 529,538
Deposits 478,605 489,259
Total borrowings 170,985 183,521
Total equity 42,652 41,410
CAPITAL RATIOS (BANK ONLY):
Total capital to risk weighted assets 14.16% 13.55%
Tier 1 capital to risk weighted assets 12.91% 12.29%
Tier 1 capital to average assets 7.45% 7.20%
ASSET QUALITY RATIOS:
Nonperforming loans to total loans 0.22% 0.24%
Allowance for loan losses to nonperforming loans 587.42% 483.76%
Allowance for loan losses to total loans 1.30% 1.17%
Three Months
Ended March 31,
---------------------------------
2003 2002
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SELECTED OPERATING DATA:
Total interest income $ 10,175 $ 9,276
Total interest expense 4,290 4,021
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Net interest income 5,885 5,255
Provision for loan losses 375 375
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Net interest income after provision for loan losses 5,510 4,880
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Noninterest income:
Service charges on deposit accounts 724 661
Fiduciary activities 556 553
Gain on sale of loans 1,021 525
Other noninterest income 488 493
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Total noninterest income 2,789 2,232
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Noninterest expense:
Salaries and employee benefits 3,249 2,928
Other noninterest expense 2,553 2,335
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Total noninterest expense 5,802 5,263
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Net income before taxes and cumulative effect of
change in accounting for goodwill 2,497 1,849
Income tax expense 773 647
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Net income before cumulative effect of change in
accounting for goodwill 1,724 1,202
Cumulative effect of change in accounting for goodwill -- (97)
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Net income $ 1,724 $ 1,105
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PERFORMANCE RATIOS:
Diluted earnings per share $ 0.84 $ 0.56
Return on average equity 16.03% 12.33%
Net interest margin 3.59% 4.03%
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