Exhibit 99.1
[HORIZON LOGO]
Contact: James H. Foglesong
Chief Financial Officer
Phone: (219) 873-2608
Fax: (219) 874-9280
Date: October 20, 2004
FOR IMMEDIATE RELEASE
HORIZON BANCORP ANNOUNCES YEAR-TO-DATE EARNINGS
Michigan City, Indiana (October 20, 2004) - Horizon Bancorp today announced
unaudited financial results for the quarter and nine months ended September 30,
2004. For the quarter ending September 30, 2004, net income was $1.763 million
or $.56 per fully diluted share. This compares to net income of $2.028 million
or $.65 per fully diluted share for the same quarter of the prior year. Year to
date net income was $5.083 million or $1.63 per fully diluted share compared to
net income of $5.527 million or $1.78 per fully diluted share for the first nine
months of the prior year.
Craig M. Dwight, President and Chief Executive Officer, stated, "We are pleased
with our financial performance for the first nine months of 2004. Although we
continue to experience an expected decline in mortgage lending volume,
commercial and consumer loan portfolios have experienced solid growth of 23% and
29% respectively since December 31, 2003. This growth has more than off-set the
decline in mortgage loan volume. We attributed this growth to our expansion of
lending activities in new markets and our experienced lending team providing
exceptional service and sensible advice."
Net income for the current quarter is lower than the same quarter of the
previous year due in part to a decrease in residential mortgage refinancing
activity. During the third quarter of 2003, refinancing activity was at a peak
level, which resulted in $1.116 million of gains on the sale of mortgage loans.
The third quarter of 2004 resulted in gains of $770 thousand, a decrease of $346
thousand.
Net interest income for the quarter ended September 30, 2004 was $6.402 million,
a decrease of $204 thousand or 3.1% over the same period of the prior year. This
decrease was the result of a decrease in net interest margin from 3.56% in the
third quarter of 2003 to 3.43% in the current quarter. The decrease was caused
by a decrease in average mortgage warehouse loans outstanding from $275 million
in the third quarter of 2003 to $122 million in the current quarter. These funds
were re-deployed into other loan types and investment securities, which carry
lower yields than the mortgage warehouse loans. Commercial loans increased from
an average of $129.7 million for the third quarter of 2003 to $179.9 million for
the current quarter. Consumer loans increased from an average of $91.7 million
for the third quarter of 2003 to $125.3 million for the third quarter of the
current year. Average earning assets were relatively constant from the third
quarter of last year to this year; however, due to the change in mix of earning
assets, declines were experienced in net interest margin and therefore net
interest income.
- MORE -
Pg. 2 Cont. Horizon's Year to Date Earnings
Non-interest income increased $33 thousand from the third quarter of 2003.
During the third quarter of 2003, a loss of $267 thousand was recognized on the
sale of securities from the investment portfolio. There were no security sales
during the current quarter.
Non-interest expense increased $350 thousand or 5.6% from the third quarter of
2003, and increased $751 thousand or 4.1% for the first nine months of 2004
compared to a similar period of the prior year. These increases relate to the
additional resources needed to support Horizon's growth.
On September 30, 2004, Horizon's total assets were $816 million, compared to
$757 million on December 31, 2003. Total net loans were $498 million at
September 30, 2004 compared to $441 million at December 31, 2003. Consumer and
commercial loans were the primary drivers of this growth. Mortgage warehouse
loans totaling $107.7 million at September 30, 2004 have declined from $126.1
million at December 31, 2003.
Horizon's allowance for loan losses at September 30, 2004 was $7.0 million, or
1.39% of gross loans, compared to $6.9 million or 1.54% at December 31, 2003.
Non-performing assets at September 30, 2004 were $1.5 million, or 0.29% of gross
loans, compared to $1.9 million or .42% at December 31, 2003. The reduction
occurred primarily in residential real estate loans.
Total deposits were $611 million at September 30, 2004, an increase of $65
million from December 31, 2003. Core deposits increased to $404.0 million at
September 30, 2004, from $395.8 million at December 31, 2003. The growth in core
deposits came primarily in NOW accounts and certificates of deposit. In addition
money market accounts from various municipal entities contributed to the growth.
Book value per common share at September 30, 2004 increased to $16.35 compared
to $15.07 at December 31, 2003. The change in stockholders' equity during the
nine months ended September 30, 2004, is the result of net income, net of
dividends declared, a decrease in the market value of investment securities
available-for-sale and the exercise of stock options.
Horizon Bancorp is a locally owned, independent, bank holding company serving
northern Indiana and southern Michigan. Horizon offers banking, insurance,
investment and trust services from offices located in Michigan City, LaPorte,
Wanatah, Chesterton, Portage, Valparaiso, Elkhart and Merrillville, Indiana, and
St. Joseph, Michigan 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 accurate. 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 # # #
HORIZON BANCORP
(In thousands except per share data and ratios)
At At
September 30, December 31,
2004 2003
---- ----
SELECTED FINANCIAL DATE:
Total assets $ 816,069 $ 757,443
Cash and cash equivalents 17,911 45,464
Investment securities available for sale 205,972 215,695
Loans held for sale 1,811 8,213
Loans, net 497,528 440,809
Deposits 611,118 546,168
Total borrowings 149,035 158,585
Total equity 49,819 46,223
CAPITAL RATIOS (BANK ONLY):
Total capital to risk weighted assets 13.29% 15.22%
Tier 1 capital to risk weighted assets 12.04% 13.97%
Tier 1 capital to average assets 7.55% 7.90%
ASSET QUALITY RATIOS:
Nonperforming loans to total loans 0.29% 0.42%
Allowance for loan losses to nonperforming loans 474.93% 367.11%
Allowance for loan losses to total loans 1.39% 1.54%
Three Months Nine Months
Ended September 30, Ended September 30,
-----------------------------------------------------------
2004 2003 2004 2003
---- ---- ---- ----
SELECTED OPERATING DATA:
Total interest income $10,613 $11,094 $31,218 $31,524
Total interest expense 4,211 4,488 12,716 13,048
------- ------- ------- -------
Net interest income 6,402 6,606 18,502 18,476
Provision for loan losses 207 300 681 1,050
------- ------- ------- -------
Net interest income after provision for loan losses 6,195 6,306 17,821 17,426
------- ------- ------- -------
Noninterest income:
Service charges on deposit accounts 807 818 2,308 2,346
Fiduciary activities 595 610 1,930 1,797
Gain on sale of loans 770 1,116 1,713 3,327
Other noninterest income 689 284 2,075 1,205
------- ------- ------- -------
Total noninterest income 2,861 2,828 8,026 8,675
------- ------- ------- -------
Noninterest expense:
Salaries and employee benefits 3,903 3,662 10,838 10,366
Other noninterest expense 2,736 2,627 8,159 7,880
------- ------- ------- -------
Total noninterest expense 6,639 6,289 18,997 18,246
------- ------- ------- -------
Net income before taxes 2,417 2,845 6,850 7,855
Income tax expense 654 817 1,767 2,328
------- ------- ------- -------
Net income $ 1,763 $ 2,028 $ 5,083 $ 5,527
======= ======= ======= =======
PERFORMANCE RATIOS:
Diluted earnings per share $ 0.56 $ 0.65 $ 1.63 $ 1.78
Return on average equity 14.79% 18.03% 14.27% 15.01%
Net interest margin 3.43% 3.56% 3.37% 3.58%