Attached files
| file | filename |
|---|---|
| 8-K - MB FINANCIAL, INC. 8K 01272011 - MB FINANCIAL INC /MD | mbfi012711_8k.htm |
EXHIBIT 99
MB Financial, Inc.
800 West Madison Street
Chicago, Illinois 60607
(888) 422-6562
NASDAQ: MBFI
PRESS RELEASE
For Information at MB Financial, Inc. contact:
Jill York - Vice President and Chief Financial Officer
E-Mail: jyork@mbfinancial.com
FOR IMMEDIATE RELEASE
MB FINANCIAL, INC. REPORTS STRONG CORE PRE-TAX, PRE-PROVISION EARNINGS, DECREASE IN NON-PERFORMING LOANS, STRONG CAPITAL AND LIQUIDITY POSITION
CHICAGO, January 27, 2011 – MB Financial, Inc. (NASDAQ: MBFI), the holding company for MB Financial Bank, N.A (“the Bank” or “MB Financial Bank”), announced today fourth quarter and annual results for 2010. The words “MB Financial,” “the Company,” “we,” “our” and “us” refer to MB Financial, Inc. and its consolidated subsidiaries, unless indicated otherwise. We had net income of $3.2 million and net income available to common stockholders of $595 thousand for the fourth quarter of 2010 compared to a net loss of $9.8 million and a net loss available to common stockholders of $12.4 million for the fourth quarter of 2009, and a net loss of $2.8 million and a net loss available to common stockholders of $5.4 million for the third quarter of 2010. We had net income of $20.5 million and net income available to common stockholders of $10.1 million for the year ended December 31, 2010 compared to a net loss of $26.1 million and a net loss available to common stockholders of $36.4 million for the year ended December 31, 2009.
Key items for the quarter were as follows:
Continued Growth in Core Pre-Tax, Pre-Provision Earnings:
|
·
|
Core pre-tax, pre-provision earnings increased 37.5% to $52.5 million, compared to $38.2 million for the fourth quarter of 2009. Core pre-tax, pre-provision earnings increased $1.5 million, or 2.9%, compared to the third quarter of 2010.
|
|
·
|
Net interest income on a fully tax equivalent basis increased to $87.3 million, or by 12.8%, compared to $77.4 million for the fourth quarter of 2009. Net interest income on a fully tax equivalent basis decreased $3.0 million, or 3.3%, compared to the third quarter of 2010.
|
|
·
|
Net interest margin on a fully tax equivalent basis increased to 3.83% from 2.86% in the fourth quarter of 2009, but decreased from 3.92% in the third quarter of 2010.
|
|
·
|
Core other income increased 28.7% to $31.9 million, compared to $24.8 million for the fourth quarter of 2009. Core other income increased $2.0 million, or 6.6%, compared to the third quarter of 2010.
|
Credit Quality – Decreased Provision, Charge-offs, and Non-Performing Loans During Quarter:
|
·
|
Our provision for loan losses was $49.0 million for the fourth quarter of 2010, while our net charge-offs were $50.7 million. For the third quarter of 2010, our provision for loan losses and net charge-offs were $65.0 million and $66.7 million, respectively. While lower than recent quarters, our provision for loan losses remains elevated and reflects continued weakness in real estate market conditions.
|
|
·
|
Our non-performing loans were $362.4 million or 5.48% of total loans as of December 31, 2010, a decrease from $392.6 million or 5.73% as of September 30, 2010. The percentage of the allowance for loan losses to non-performing loans was 53.03% as of December 31, 2010 and 49.40% as of September 30, 2010.
|
|
·
|
During the fourth quarter of 2010, we completed a sale of approximately $22 million of non-performing loans to third parties consisting of $16 million of commercial real estate loans and $6 million of construction loans.
|
|
·
|
Our non-performing assets were $434.0 million or 4.21% of total assets as of December 31, 2010, a decrease from $452.0 million or 4.26% of total assets as of September 30, 2010.
|
|
·
|
Potential problem loans were $291.7 million as of December 31, 2010, a decrease from $311.3 million as of September 30, 2010. Our allowance for loan losses to total loans was 2.90% as of December 31, 2010, compared to 2.83% as of September 30, 2010.
|
4
For purposes of the second and fourth bullet points above, non-performing loans exclude loans held for sale and certain purchased credit-impaired loans that MB Financial Bank acquired in FDIC-assisted transactions, a majority of which are subject to loss share arrangements with the FDIC. These purchased credit-impaired loans are accounted for on a pool basis, and the pools are considered to be performing. Additionally, non-performing assets exclude other real estate owned related to assets acquired in FDIC-assisted transactions.
Strong Capital Position:
|
·
|
MB Financial Bank significantly exceeds the “Well-Capitalized” threshold established under the regulations of the Office of the Comptroller of the Currency. At December 31, 2010, MB Financial, Inc.’s total risk-based capital ratio was 17.75%, Tier 1 capital to risk-weighted assets ratio was 15.75%, Tier 1 capital to average asset ratio was 10.66% and Tier 1 common capital to risk-weighted assets was 10.61%, compared with 17.14%, 15.15%, 10.38% and 10.17%, respectively, as of September 30, 2010. As of December 31, 2010, total capital was approximately $524.9 million in excess of the “Well-Capitalized” threshold, compared with $497.0 million as of September 30, 2010. Our tangible common equity to tangible assets ratio was 7.47% at December 31, 2010, compared to 7.17% at September 30, 2010. Our tangible common equity to risk-weighted assets ratio was 10.94% at December 31, 2010, compared to 10.49% at September 30, 2010.
|
Strong Liquidity Position and Continued Improvement in Deposit Mix:
|
·
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Our loan to deposit ratio was 81% as of December 31, 2010, a slight decrease from 82% as of September 30, 2010.
|
|
·
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Our ratio of certificates of deposit to total deposits was 37% at December 31, 2010, compared to 39% at September 30, 2010.
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|
·
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Our ratio of non-interest bearing deposits to total deposits was 21% at December 31, 2010, up from 20% at September 30, 2010.
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Transactions Update:
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·
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During the fourth quarter of 2010, purchase accounting was finalized on our Benchmark Bank, Broadway Bank and New Century Bank FDIC-assisted transactions with no impact on the previously recognized bargain purchase gains. As of December 31, 2010, purchase accounting on all of our FDIC-assisted transactions was final.
|
5
RESULTS OF OPERATIONS
Fourth Quarter Results
Net Interest Income
Net interest income on a tax equivalent basis increased $9.9 million from the fourth quarter of 2009, and decreased by $3.0 million from the third quarter of 2010 to the fourth quarter of 2010. Our net interest margin, on fully tax equivalent basis, was 3.83% for the fourth quarter of 2010 compared to 3.92% in the third quarter of 2010 and 2.86% in the fourth quarter of 2009. The margin increase from the fourth quarter of 2009 was due to an improved average loan yield as a result of an improved loan mix, an improved asset mix with loans representing a greater fraction of assets, and a decrease in our average cost of funds as a result of an improved deposit mix and downward repricing of certificates of deposit. The margin decrease from the third quarter of 2010 was primarily due to higher levels of cash and cash equivalents held throughout the fourth quarter.
Net interest income on a tax equivalent basis increased $89.1 million from the year ended December 31, 2009 to the year ended December 31, 2010. Our net interest margin, on fully tax equivalent basis, was 3.83% for the year ended December 31, 2010 compared to 2.97% for the year ended December 31, 2009. The margin increase from the prior year was due to an improved loan mix and a decrease in our average cost of funds as a result of an improved deposit mix and downward repricing of certificates of deposit.
Our non-performing loans reduced our net interest margin during the fourth quarter of 2010, the third quarter of 2010 and the fourth quarter of 2009 by approximately 23 basis points, 22 basis points and 17 basis points, respectively.
See the supplemental net interest margin table for further detail.
Other Income (in thousands):
|
Three Months Ended
|
Year Ended
|
||||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
|||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
|||
|
Core other income:
|
|||||||||
|
Loan service fees
|
$ 1,532
|
$ 1,659
|
$ 2,042
|
$ 1,284
|
$ 1,723
|
$ 6,517
|
$ 6,913
|
||
|
Deposit service fees
|
9,920
|
10,705
|
9,461
|
8,848
|
9,311
|
38,934
|
30,600
|
||
|
Lease financing, net
|
7,185
|
5,022
|
5,026
|
4,620
|
5,799
|
21,853
|
18,528
|
||
|
Brokerage fees
|
1,231
|
1,407
|
1,129
|
1,245
|
1,272
|
5,012
|
4,606
|
||
|
Trust and asset management fees
|
4,243
|
3,923
|
3,536
|
3,335
|
3,347
|
15,037
|
12,593
|
||
|
Increase in cash surrender value of life insurance
|
930
|
1,209
|
706
|
671
|
669
|
3,516
|
2,459
|
||
|
Accretion of indemnification asset
|
3,009
|
3,602
|
3,067
|
-
|
-
|
9,678
|
-
|
||
|
Other operating income
|
3,857
|
2,406
|
2,872
|
2,869
|
2,663
|
12,004
|
8,611
|
||
|
Total core other income
|
31,907
|
29,933
|
27,839
|
22,872
|
24,784
|
112,551
|
84,310
|
||
|
Non-core other income(1)
|
|||||||||
|
Net gain on sale of investment securities
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(4)
|
9,482
|
2,304
|
6,866
|
239
|
18,648
|
14,029
|
||
|
Net gain (loss) on sale of other assets
|
419
|
299
|
(99)
|
11
|
12
|
630
|
(13)
|
||
|
Net gain (loss) recognized on other real estate owned(A)
|
(1,656)
|
(3,608)
|
52
|
(3,299)
|
(733)
|
(8,511)
|
(429)
|
||
|
Net loss recognized on other real estate owned related to FDIC transactions(A)
|
(468)
|
(305)
|
-
|
-
|
-
|
(773)
|
-
|
||
|
Acquisition related gains
|
-
|
-
|
62,649
|
-
|
18,325
|
62,649
|
28,547
|
||
|
Increase (decrease) in market value of assets held in
|
|||||||||
|
trust for deferred compensation(A)
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
||
|
Total non-core other income
|
(1,112)
|
5,865
|
64,867
|
3,585
|
18,143
|
73,205
|
42,844
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||
|
Total other income
|
$ 30,795
|
$ 35,798
|
$ 92,706
|
$ 26,457
|
$ 42,927
|
$ 185,756
|
$ 127,154
|
||
|
(1)
|
Letter denotes the corresponding line items where these non-core other income items reside in the consolidated statements of income as follows: A – Other operating income.
|
6
Core other income increased by $2.0 million from the third quarter of 2010 to the fourth quarter of 2010. Core deposit service fees decreased primarily due to decreases in NSF and overdraft fees. Net lease financing income increased mainly as a result of an increase in the sales of third party equipment maintenance contracts. Accretion of indemnification asset decreased as expected due to a corresponding decrease in the indemnification asset balance during the fourth quarter of 2010. Other operating income increased primarily as a result of higher income from several investment partnerships. The decrease in non-core other income was mainly a result of the net gain on sale of investment securities of $9.5 million recognized in the third quarter of 2010. Gains were taken on securities to lock in those gains and shorten the overall duration of our securities portfolio. A net loss was recognized on other real estate owned (“OREO”) of $2.1 million in the fourth quarter of 2010 compared $3.9 million in the third quarter of 2010. It is our practice to reappraise all OREO at least annually and whenever we think there might be a material change in value.
Core other income increased by $28.2 million for the year ended December 31, 2010 compared to the year ended December 31, 2009. Core deposit service fees increased primarily due to an increase in commercial deposit fees related to the treasury management business acquired in the Corus FDIC-assisted transaction during the second half of 2009, and an increase in NSF and overdraft fees. Net lease financing increased primarily due to an increase in the sales of third party equipment maintenance contracts. Core trust and asset management fees increased primarily due to an increase in assets under management, as a result of organic growth and an increase in the market value of assets under management. The Broadway Bank and New Century Bank FDIC-assisted transactions resulted in accretion on the corresponding indemnification asset. Prior year accretion related to the Heritage Bank transaction and was not significant. Other income increased primarily due to fee income related to our FDIC-assisted transactions completed during the second half of 2009. Non-core other income was primarily impacted by gains recorded on the Broadway Bank and New Century Bank FDIC-assisted transactions. Non-core other income was impacted to a lesser extent by a net gain on sale of investment securities of $18.6 million for the year ended December 31, 2010, compared with a net gain on sale of investment securities of $14.0 million for the year ended December 31, 2009, and a net loss recognized on OREO of $9.3 million for the year ended December 31, 2010, compared with a net loss of $429 thousand for the year ended December 31, 2009.
7
Other Expense (in thousands):
|
Three Months Ended
|
Year Ended
|
||||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
|||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
|||
|
Core other expense:
|
|||||||||
|
Salaries and employee benefits
|
$ 35,802
|
$ 37,427
|
$ 37,143
|
$ 33,415
|
$ 33,091
|
$ 143,787
|
$ 119,944
|
||
|
Occupancy and equipment expense
|
7,938
|
8,800
|
8,928
|
9,179
|
8,885
|
34,845
|
31,521
|
||
|
Computer services expense
|
2,445
|
2,654
|
3,322
|
2,528
|
2,882
|
10,949
|
10,011
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||
|
Advertising and marketing expense
|
1,573
|
1,620
|
1,639
|
1,633
|
683
|
6,465
|
4,185
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||
|
Professional and legal expense
|
1,718
|
1,637
|
1,370
|
1,078
|
1,465
|
5,803
|
4,680
|
||
|
Brokerage fee expense
|
448
|
596
|
420
|
462
|
553
|
1,926
|
1,999
|
||
|
Telecommunication expense
|
819
|
975
|
964
|
908
|
1,127
|
3,666
|
3,433
|
||
|
Other intangibles amortization expense
|
1,632
|
1,567
|
1,505
|
1,510
|
1,650
|
6,214
|
4,491
|
||
|
FDIC insurance premiums
|
3,930
|
3,873
|
3,833
|
3,964
|
4,099
|
15,600
|
12,912
|
||
|
Other real estate expense, net
|
858
|
734
|
417
|
685
|
245
|
2,694
|
871
|
||
|
Other operating expenses
|
6,855
|
6,598
|
6,530
|
6,282
|
6,092
|
26,265
|
21,143
|
||
|
Total core other expense
|
64,018
|
66,481
|
66,071
|
61,644
|
60,772
|
258,214
|
215,190
|
||
|
Non-core other expense (1)
|
|||||||||
|
FDIC special assessment(A)
|
-
|
-
|
-
|
-
|
-
|
-
|
3,850
|
||
|
Impairment charges
|
-
|
-
|
-
|
-
|
-
|
-
|
4,000
|
||
|
Increase (decrease) in market value of assets held in
|
|||||||||
|
trust for deferred compensation(B)
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
||
|
Total non-core other expense
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
8,560
|
||
|
Total other expense
|
$ 64,615
|
$ 66,478
|
$ 66,032
|
$ 61,651
|
$ 61,072
|
$ 258,776
|
$ 223,750
|
||
|
(1)
|
Letters denote the corresponding line items where these non-core other expense items reside in the consolidated statements of income as follows: A – FDIC insurance premiums, B – Salaries and employee benefits.
|
Core other expense decreased by $2.5 million from the third quarter of 2010 to the fourth quarter of 2010. Salaries and employee benefits decreased mainly due to a decrease in healthcare expense for the quarter as a result of lower claims within our partially self-insured plan. Occupancy and equipment expense decreased as a result of decreased property taxes and utilities expenses.
Core other expense increased $43.0 million for the year ended December 31, 2010 compared to the year ended December 31, 2009. The FDIC-assisted transactions completed in 2009 and 2010 increased total core other expense from the twelve months ended December 31, 2009 to the twelve months ended December 31, 2010 by approximately $23.1 million. Salaries and employee benefits expense also increased due to problem loan remediation staff added throughout the year. Other real estate expense increased as a result of an increase in OREO activity during the year. Core other operating expenses increased due to an increase of $1.4 million in debit card expenses due to increased activity and expenses related to our FDIC-assisted transactions. Non-core other expense was primarily impacted by a $4.0 million impairment charge incurred in 2009 relating to the consolidation of three branch offices, and the FDIC special premium imposed on all insured depository institutions in 2009.
8
LOAN PORTFOLIO
The following table sets forth the composition of the loan portfolio as of the dates indicated (dollars in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
||||||||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||||||||
|
Amount
|
% of Total
|
Amount
|
% of Total
|
Amount
|
% of Total
|
Amount
|
% of Total
|
Amount
|
% of Total
|
|||
|
Commercial related credits:
|
||||||||||||
|
Commercial loans
|
$ 1,206,984
|
18%
|
$ 1,291,115
|
19%
|
$ 1,315,899
|
19%
|
$ 1,378,873
|
21%
|
$ 1,387,476
|
21%
|
||
|
Commercial loans collateralized by assign-
|
||||||||||||
|
ment of lease payments (lease loans)
|
1,053,446
|
16%
|
1,019,083
|
15%
|
992,301
|
14%
|
960,470
|
15%
|
953,452
|
15%
|
||
|
Commercial real estate
|
2,176,584
|
33%
|
2,259,708
|
33%
|
2,378,272
|
34%
|
2,409,078
|
38%
|
2,472,520
|
38%
|
||
|
Construction real estate
|
423,339
|
6%
|
445,881
|
6%
|
496,732
|
7%
|
558,615
|
9%
|
594,482
|
9%
|
||
|
Total commercial related credits
|
4,860,353
|
73%
|
5,015,787
|
73%
|
5,183,204
|
74%
|
5,307,036
|
83%
|
5,407,930
|
83%
|
||
|
Other loans:
|
||||||||||||
|
Residential real estate
|
328,482
|
5%
|
328,985
|
5%
|
321,665
|
5%
|
302,308
|
5%
|
291,022
|
4%
|
||
|
Indirect motorcycle
|
161,761
|
2%
|
166,163
|
2%
|
164,269
|
2%
|
158,207
|
2%
|
156,853
|
2%
|
||
|
Indirect automobile
|
13,903
|
1%
|
15,928
|
0%
|
17,914
|
0%
|
20,437
|
1%
|
23,414
|
1%
|
||
|
Home equity
|
381,662
|
6%
|
386,866
|
6%
|
389,298
|
6%
|
401,570
|
6%
|
405,439
|
6%
|
||
|
Consumer loans
|
59,320
|
1%
|
76,219
|
1%
|
73,436
|
1%
|
70,247
|
1%
|
66,293
|
1%
|
||
|
Total other loans
|
945,128
|
15%
|
974,161
|
14%
|
966,582
|
14%
|
952,769
|
15%
|
943,021
|
14%
|
||
|
Gross loans excluding covered loans
|
5,805,481
|
88%
|
5,989,948
|
87%
|
6,149,786
|
88%
|
6,259,805
|
98%
|
6,350,951
|
97%
|
||
|
Covered loans (1)
|
812,330
|
12%
|
859,038
|
13%
|
879,909
|
12%
|
155,051
|
2%
|
173,596
|
3%
|
||
|
Gross loans
|
6,617,811
|
100%
|
6,848,986
|
100%
|
7,029,695
|
100%
|
6,414,856
|
100%
|
6,524,547
|
100%
|
||
|
Allowance for loan losses
|
(192,217)
|
(193,926)
|
(195,612)
|
(177,787)
|
(177,072)
|
|||||||
|
Net loans
|
$ 6,425,594
|
$ 6,655,060
|
$ 6,834,083
|
$ 6,237,069
|
$ 6,347,475
|
|||||||
|
(1)
|
Covered loans refer to loans we acquired in FDIC-assisted transactions that are subject to loss-sharing agreements with the FDIC.
|
The increase in covered loans from March 31, 2010 to June 30, 2010 was due to the Broadway Bank and New Century Bank FDIC-assisted transactions.
9
ASSET QUALITY
The following table presents a summary of non-performing assets, excluding credit-impaired loans that were acquired as part of our FDIC-assisted transactions (see definition of “purchased credit-impaired loans” below), and OREO related to FDIC-assisted transactions, as of the dates indicated (dollar amounts in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||
|
Non-performing loans:
|
||||||
| Non-accrual loans(1) |
$ 362,441
|
$ 392,477
|
$ 343,838
|
$ 323,017
|
$ 270,839
|
|
|
Loans 90 days or more past due, still accruing interest
|
1
|
115
|
-
|
150
|
477
|
|
|
Total non-performing loans
|
362,442
|
392,592
|
343,838
|
323,167
|
271,316
|
|
|
OREO
|
71,476
|
59,114
|
43,988
|
41,589
|
36,711
|
|
|
Repossessed vehicles
|
82
|
321
|
191
|
250
|
333
|
|
|
Total non-performing assets
|
$ 434,000
|
$ 452,027
|
$ 388,017
|
$ 365,006
|
$ 308,360
|
|
|
Total allowance for loan losses
|
192,217
|
193,926
|
195,612
|
177,787
|
177,072
|
|
|
Partial charge-offs taken on non-performing loans
|
163,972
|
171,549
|
142,872
|
95,960
|
69,359
|
|
|
Allowance for loan losses, including partial charge-offs
|
$ 356,189
|
$ 365,475
|
$ 338,484
|
$ 273,747
|
$ 246,431
|
|
|
Accruing restructured loans(2)
|
$ 22,543
|
$ 12,226
|
$ 10,940
|
$ -
|
$ -
|
|
|
Total non-performing loans to total loans
|
5.48%
|
5.73%
|
4.89%
|
5.04%
|
4.16%
|
|
|
Total non-performing assets to total assets
|
4.21%
|
4.26%
|
3.64%
|
3.58%
|
2.84%
|
|
|
Allowance for loan losses to non-performing loans
|
53.03%
|
49.40%
|
56.89%
|
55.01%
|
65.26%
|
|
|
Allowance for loan losses to non-performing loans,
|
||||||
|
including partial charge-offs taken
|
67.66%
|
64.78%
|
69.55%
|
65.31%
|
72.34%
|
|
|
(1)
|
Includes restructured loans on non-accrual status.
|
|
(2)
|
Accruing restructured loans at December 31, 2010 consists primarily of residential real estate and home equity loans that have been modified and are performing in accordance with those modified terms. It also includes approximately $8 million of commercial related loans.
|
The following table presents a summary of total performing loans greater than 30 days and less than 90 days past due, excluding credit-impaired loans that were acquired as part of our FDIC-assisted transactions (see definition of “purchased credit-impaired loans” below), as of the dates indicated (dollar amounts in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||
|
30 - 59 Days Past Due
|
$ 9,386
|
$ 19,302
|
$ 26,491
|
$ 17,239
|
$ 25,331
|
|
|
60 - 89 Days Past Due
|
5,073
|
6,011
|
3,746
|
1,653
|
5,523
|
|
|
$ 14,459
|
$ 25,313
|
$ 30,237
|
$ 18,892
|
$ 30,854
|
Approximately $1.7 million of performing loans past due are classified as potential problem loans (defined below) as of December 31, 2010, compared to $6.3 million as of September 30, 2010.
10
The following table represents a summary of OREO, excluding OREO related to FDIC-assisted transactions (in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
||
|
Balance at beginning of quarter
|
$ 59,114
|
$ 43,988
|
$ 41,589
|
$ 36,711
|
|
|
Transfers in at fair value less estimated costs to sell
|
27,170
|
21,383
|
4,967
|
10,438
|
|
|
Fair value adjustments
|
(1,562)
|
(3,429)
|
-
|
(2,795)
|
|
|
Net losses (gains) on sales of OREO
|
(94)
|
(179)
|
52
|
(504)
|
|
|
Cash received upon disposition
|
(13,152)
|
(2,649)
|
(2,620)
|
(2,261)
|
|
|
Balance at the end of quarter
|
$ 71,476
|
$ 59,114
|
$ 43,988
|
$ 41,589
|
The following table presents data related to non-performing loans, by dollar amount and category at December 31, 2010, excluding credit-impaired loans that were acquired as part of our FDIC-assisted transactions (dollar amounts in thousands):
|
Commercial and Lease Loans
|
Construction Real Estate Loans
|
Commercial Real Estate Loans
|
Consumer Loans
|
Total Loans
|
||||
|
Number of Borrowers
|
Amount
|
Number of Borrowers
|
Amount
|
Number of Borrowers
|
Amount
|
Amount
|
Amount
|
|
|
$10.0 million or more
|
-
|
$ -
|
2
|
$ 29,695
|
2
|
$ 34,423
|
$ -
|
$ 64,118
|
|
$5.0 million to $9.9 million
|
3
|
23,683
|
5
|
29,791
|
3
|
20,102
|
-
|
73,576
|
|
$1.5 million to $4.9 million
|
6
|
14,005
|
13
|
41,313
|
15
|
41,720
|
3,272
|
100,310
|
|
Under $1.5 million
|
45
|
14,880
|
30
|
21,278
|
144
|
62,619
|
25,661
|
124,438
|
|
54
|
$ 52,568
|
50
|
$ 122,077
|
164
|
$ 158,864
|
$ 28,933
|
$ 362,442
|
|
|
Percentage of individual loan category
|
2.33%
|
28.84%
|
7.30%
|
3.06%
|
5.48%
|
|||
|
Specific reserves and partial charge-offs as a
|
||||||||
|
percentage of non-performing loans
|
44%
|
47%
|
32%
|
|||||
The following table presents data related to non-performing loans, by dollar amount and category at September 30, 2010 (dollar amounts in thousands):
|
Commercial and Lease Loans
|
Construction Real Estate Loans
|
Commercial Real Estate Loans
|
Consumer Loans
|
Total Loans
|
||||
|
Number of Borrowers
|
Amount
|
Number of Borrowers
|
Amount
|
Number of Borrowers
|
Amount
|
Amount
|
Amount
|
|
|
$10.0 million or more
|
-
|
$ -
|
1
|
$ 14,539
|
4
|
$ 63,807
|
$ -
|
$ 78,346
|
|
$5.0 million to $9.9 million
|
3
|
23,179
|
6
|
41,727
|
2
|
12,412
|
-
|
77,318
|
|
$1.5 million to $4.9 million
|
9
|
19,297
|
17
|
53,736
|
20
|
52,540
|
1,575
|
127,148
|
|
Under $1.5 million
|
51
|
14,543
|
31
|
20,420
|
130
|
51,366
|
23,451
|
109,780
|
|
63
|
$ 57,019
|
55
|
$ 130,422
|
156
|
$ 180,125
|
$ 25,026
|
$ 392,592
|
|
|
Percentage of individual loan category
|
2.47%
|
29.25%
|
7.97%
|
2.57%
|
5.73%
|
|||
|
Specific reserves and partial charge-offs as a
|
||||||||
|
percentage of non-performing loans
|
48%
|
48%
|
27%
|
|||||
We define potential problem loans as performing loans rated substandard that do not meet the definition of a non-performing loan (See “Asset Quality” section above for non-performing loans). Potential problem loans carry a higher probability of default and require additional attention by management. The aggregate principal amount of potential problem loans was $291.7 million, or 4.41% of total loans, as of December 31, 2010, compared to $311.3 million, or 4.54% of total loans, as of September 30, 2010.
11
“Purchased credit-impaired loans” refer to certain loans acquired in FDIC-assisted transactions, for which deterioration in credit quality occurred before the Company’s acquisition date. Upon acquisition, these loans were recorded at fair value with interest income to be accreted over the estimated life of the loan when cash flows are reasonably estimable, even if the underlying loans are contractually past due. Acquisition fair value incorporates the Company’s estimate, as of the acquisition date, of credit losses over the remaining life of the portfolio. No allowance for loan losses has been recorded for these loans.
The following table displays information on commercial real estate loans by risk category and type, excluding covered loans at December 31, 2010 (dollars in thousands):
|
Risk Category
|
|||||||||
|
Potential Problem
|
|||||||||
|
Non-Performing
|
and Other Watch
|
||||||||
|
Loans (NPLs)
|
List Loans
|
Pass Loans
|
Total
|
||||||
|
Amount
|
% of Loan Balance Reserved(1)
|
Amount
|
% of Loan Balance Reserved
|
Amount
|
% of Loan Balance Reserved
|
Amount
|
% of Loan Balance Reserved(1)
|
||
|
Church and school
|
$ 177
|
36%
|
$ 7,147
|
20%
|
$ 58,218
|
1%
|
$ 65,542
|
4%
|
|
|
Healthcare
|
-
|
-
|
4,899
|
15%
|
199,349
|
2%
|
204,248
|
2%
|
|
|
Industrial
|
36,426
|
25%
|
88,252
|
17%
|
398,703
|
2%
|
523,381
|
7%
|
|
|
Multifamily
|
30,344
|
40%
|
47,318
|
19%
|
383,116
|
2%
|
460,778
|
7%
|
|
|
Office
|
9,959
|
44%
|
49,035
|
18%
|
158,585
|
4%
|
217,579
|
10%
|
|
|
Other
|
35,101
|
16%
|
23,914
|
18%
|
171,697
|
2%
|
230,712
|
6%
|
|
|
Retail
|
46,857
|
39%
|
43,264
|
18%
|
384,223
|
2%
|
474,344
|
9%
|
|
|
$ 158,864
|
32%
|
$ 263,829
|
18%
|
$ 1,753,891
|
2%
|
$ 2,176,584
|
7%
|
||
|
(1)
|
To calculate the percentage of loan balances reserved, partial charge-offs taken on loans with balances outstanding have been added back to both reserves and outstanding balance.
|
The following table sets forth information on commercial real estate loans by risk category and type, excluding covered loans at September 30, 2010 (dollars in thousands):
|
Risk Category
|
|||||||||
|
Potential Problem
|
|||||||||
|
Non-Performing
|
and Other Watch
|
||||||||
|
Loans (NPLs)
|
List Loans
|
Pass Loans
|
Total
|
||||||
|
Amount
|
% of Loan Balance Reserved(1)
|
Amount
|
% of Loan Balance Reserved
|
Amount
|
% of Loan Balance Reserved
|
Amount
|
% of Loan Balance Reserved(1)
|
||
|
Church and school
|
$ 785
|
7%
|
$ 7,204
|
18%
|
$ 54,264
|
1%
|
$ 62,253
|
3%
|
|
|
Healthcare
|
-
|
-
|
4,915
|
13%
|
194,521
|
2%
|
199,436
|
2%
|
|
|
Industrial
|
29,242
|
19%
|
86,034
|
16%
|
440,625
|
2%
|
555,901
|
5%
|
|
|
Multifamily
|
38,669
|
28%
|
66,221
|
13%
|
373,394
|
1%
|
478,284
|
6%
|
|
|
Office
|
15,933
|
38%
|
41,374
|
16%
|
165,720
|
1%
|
223,027
|
8%
|
|
|
Other
|
34,504
|
13%
|
33,982
|
12%
|
177,652
|
1%
|
246,138
|
5%
|
|
|
Retail
|
60,992
|
32%
|
51,004
|
14%
|
382,673
|
2%
|
494,669
|
8%
|
|
|
$ 180,125
|
27%
|
$ 290,734
|
14%
|
$ 1,788,849
|
2%
|
$ 2,259,708
|
6%
|
||
|
(1)
|
To calculate the percentage of loan balances reserved, partial charge-offs taken on loans with balances outstanding have been added back to both reserves and outstanding balance.
|
12
The following table sets forth trend information for construction real estate loans by risk category, excluding covered loans for the past five quarters (dollars in thousands):
|
Risk Category
|
|||||||||
|
Potential Problem
|
|||||||||
|
Non-Performing
|
and Other Watch
|
||||||||
|
Loans (NPLs)
|
List Loans
|
Pass Loans
|
Total
|
||||||
|
Amount
|
% of Loan Balance Reserved(1)
|
Amount
|
% of Loan Balance Reserved
|
Amount
|
% of Loan Balance Reserved
|
Amount
|
% of Loan Balance Reserved(1)
|
||
|
Total construction loans as of December 31, 2009
|
$ 180,991
|
35%
|
$ 126,493
|
16%
|
$ 286,998
|
5%
|
$ 594,482
|
19%
|
|
|
Total construction loans as of March 31, 2010
|
$ 177,292
|
39%
|
$ 121,743
|
17%
|
$ 259,580
|
4%
|
$ 558,615
|
20%
|
|
|
Total construction loans as of June 30, 2010
|
$ 176,531
|
44%
|
$ 97,162
|
17%
|
$ 223,039
|
3%
|
$ 496,732
|
24%
|
|
|
Total construction loans as of September 30, 2010
|
$ 130,422
|
48%
|
$ 95,256
|
16%
|
$ 220,203
|
3%
|
$ 445,881
|
23%
|
|
|
Total construction loans as of December 31, 2010
|
$ 122,077
|
47%
|
$ 64,303
|
14%
|
$ 236,959
|
3%
|
$ 423,339
|
22%
|
|
|
(1)
|
To calculate the percentage of loan balances reserved, partial charge-offs taken on loans with balances outstanding have been added back to both reserves and outstanding balance.
|
13
Below is a reconciliation of the activity in our allowance for loan losses for the periods indicated (dollar amounts in thousands):
|
Three Months Ended
|
Year Ended
|
||||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
|||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
|||
|
Balance at the beginning of period
|
$ 193,926
|
$ 195,612
|
$ 177,787
|
$ 177,072
|
$ 189,232
|
$ 177,072
|
$ 144,001
|
||
|
Provision for loan losses
|
49,000
|
65,000
|
85,000
|
47,200
|
70,000
|
246,200
|
231,800
|
||
|
Charge-offs:
|
|||||||||
|
Commercial loans
|
(9,141)
|
(11,362)
|
(30,211)
|
(7,363)
|
(8,892)
|
(58,077)
|
(46,113)
|
||
|
Commercial loans collateralized by assignment
|
|||||||||
|
of lease payments (lease loans)
|
(43)
|
(418)
|
(917)
|
(333)
|
(333)
|
(1,711)
|
(5,407)
|
||
|
Commercial real estate loans
|
(27,360)
|
(25,265)
|
(15,002)
|
(12,201)
|
(11,829)
|
(79,828)
|
(38,842)
|
||
|
Construction real estate
|
(17,136)
|
(29,120)
|
(22,992)
|
(25,285)
|
(59,435)
|
(94,533)
|
(103,789)
|
||
|
Residential real estate
|
(1,363)
|
(1,500)
|
(4)
|
(459)
|
(650)
|
(3,326)
|
(1,476)
|
||
|
Indirect vehicle
|
(968)
|
(503)
|
(611)
|
(1,117)
|
(1,324)
|
(3,199)
|
(4,085)
|
||
|
Home equity
|
(1,364)
|
(1,369)
|
(1,271)
|
(628)
|
(1,236)
|
(4,632)
|
(3,443)
|
||
|
Consumer loans
|
(428)
|
(600)
|
(202)
|
(525)
|
(479)
|
(1,755)
|
(1,124)
|
||
|
Total charge-offs
|
(57,803)
|
(70,137)
|
(71,210)
|
(47,911)
|
(84,178)
|
(247,061)
|
(204,279)
|
||
|
Recoveries:
|
|||||||||
|
Commercial loans
|
3,842
|
1,900
|
2,322
|
724
|
1,344
|
8,788
|
1,491
|
||
|
Commercial loans collateralized by assignment
|
|||||||||
|
of lease payments (lease loans)
|
26
|
62
|
96
|
-
|
-
|
184
|
-
|
||
|
Commercial real estate loans
|
800
|
907
|
177
|
186
|
12
|
2,070
|
40
|
||
|
Construction real estate
|
1,672
|
330
|
1,055
|
113
|
154
|
3,170
|
2,957
|
||
|
Residential real estate
|
127
|
7
|
9
|
41
|
4
|
184
|
44
|
||
|
Indirect vehicle
|
286
|
232
|
344
|
301
|
301
|
1,163
|
757
|
||
|
Home equity
|
250
|
11
|
31
|
59
|
9
|
351
|
53
|
||
|
Consumer loans
|
91
|
2
|
1
|
2
|
194
|
96
|
208
|
||
|
Total recoveries
|
7,094
|
3,451
|
4,035
|
1,426
|
2,018
|
16,006
|
5,550
|
||
|
Total net charge-offs
|
(50,709)
|
(66,686)
|
(67,175)
|
(46,485)
|
(82,160)
|
(231,055)
|
(198,729)
|
||
|
Balance
|
$ 192,217
|
$ 193,926
|
$ 195,612
|
$ 177,787
|
$ 177,072
|
$ 192,217
|
$ 177,072
|
||
|
Total loans, excluding loans held for sale
|
$ 6,617,811
|
$ 6,848,986
|
$ 7,029,695
|
$ 6,414,856
|
$ 6,524,547
|
$ 6,617,811
|
$ 6,524,547
|
||
|
Average loans, excluding loans held for sale
|
$ 6,723,840
|
$ 6,939,415
|
$ 6,925,140
|
$ 6,441,625
|
$ 6,460,195
|
$ 6,758,776
|
$ 6,421,249
|
||
|
Ratio of allowance for loan losses to total loans,
|
|||||||||
|
excluding loans held for sale
|
2.90%
|
2.83%
|
2.78%
|
2.77%
|
2.71%
|
2.90%
|
2.71%
|
||
|
Net loan charge-offs to average loans, excluding loans
|
|||||||||
|
held for sale (annualized)
|
2.99%
|
3.81%
|
3.89%
|
2.93%
|
5.05%
|
3.42%
|
3.09%
|
||
Although management believes that adequate specific and general loan loss allowances have been established, actual losses are dependent upon future events and, as such, further additions to the level of specific and general loan loss allowances may become necessary.
14
INVESTMENT SECURITIES AVAILABLE FOR SALE
The following table sets forth the fair value, amortized cost, and total unrealized gain (loss) of our investment securities available for sale, by type (in thousands):
|
At December 31,
|
At September 30,
|
At June 30,
|
At March 31,
|
At December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||
|
Fair Value
|
||||||
|
Government sponsored agencies and enterprises
|
19,434
|
24,698
|
49,142
|
55,716
|
70,239
|
|
|
States and political subdivisions
|
364,932
|
379,675
|
377,105
|
375,523
|
380,234
|
|
|
Mortgage-backed securities
|
1,197,066
|
898,837
|
1,326,432
|
1,708,512
|
2,377,051
|
|
|
Corporate bonds
|
6,140
|
6,140
|
6,356
|
6,356
|
11,395
|
|
|
Equity securities
|
10,171
|
10,315
|
10,172
|
4,384
|
4,314
|
|
|
Total fair value
|
$ 1,597,743
|
$ 1,319,665
|
$ 1,769,207
|
$ 2,150,491
|
$ 2,843,233
|
|
|
Amortized cost
|
||||||
|
Government sponsored agencies and enterprises
|
18,766
|
23,826
|
48,138
|
54,672
|
69,120
|
|
|
States and political subdivisions
|
351,274
|
355,121
|
359,556
|
362,453
|
366,845
|
|
|
Mortgage-backed securities
|
1,175,021
|
887,422
|
1,301,301
|
1,696,669
|
2,382,495
|
|
|
Corporate bonds
|
6,140
|
6,140
|
6,356
|
6,356
|
11,400
|
|
|
Equity securities
|
10,093
|
10,016
|
9,949
|
4,318
|
4,280
|
|
|
Total amortized cost
|
$ 1,561,294
|
$ 1,282,525
|
$ 1,725,300
|
$ 2,124,468
|
$ 2,834,140
|
|
|
Unrealized gain (loss)
|
||||||
|
Government sponsored agencies and enterprises
|
668
|
872
|
1,004
|
1,044
|
1,119
|
|
|
States and political subdivisions
|
13,658
|
24,554
|
17,549
|
13,070
|
13,389
|
|
|
Mortgage-backed securities
|
22,045
|
11,415
|
25,131
|
11,843
|
(5,444)
|
|
|
Corporate bonds
|
-
|
-
|
-
|
-
|
(5)
|
|
|
Equity securities
|
78
|
299
|
223
|
66
|
34
|
|
|
Total unrealized gain
|
$ 36,449
|
$ 37,140
|
$ 43,907
|
$ 26,023
|
$ 9,093
|
|
We do not have any meaningful direct or indirect holdings of subprime residential mortgage loans, home equity lines of credit, or any Fannie Mae or Freddie Mac preferred or common equity securities in our investment securities portfolio. Additionally, more than 99% of our mortgage-backed securities are agency guaranteed.
15
FUNDING MIX AND LIQUIDITY
The following table shows the composition of our core and wholesale funding resources as of the dates indicated (dollars in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
||||||||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||||||||
|
% of
|
% of
|
% of
|
% of
|
% of
|
||||||||
|
Amount
|
Total
|
Amount
|
Total
|
Amount
|
Total
|
Amount
|
Total
|
Amount
|
Total
|
|||
|
Core funding:
|
||||||||||||
|
Non-interest bearing deposits
|
$ 1,691,599
|
19%
|
$ 1,704,142
|
19%
|
$ 1,604,482
|
18%
|
$ 1,424,746
|
16%
|
$ 1,552,185
|
16%
|
||
|
Money market and NOW accounts
|
2,776,181
|
31%
|
2,819,731
|
31%
|
2,773,306
|
30%
|
2,716,339
|
31%
|
2,775,468
|
29%
|
||
|
Savings accounts
|
697,851
|
8%
|
633,975
|
7%
|
618,199
|
7%
|
589,485
|
7%
|
583,783
|
6%
|
||
|
Certificates of deposit
|
2,447,005
|
28%
|
2,649,759
|
29%
|
2,824,075
|
31%
|
2,737,779
|
31%
|
3,153,310
|
33%
|
||
|
Customer repurchase agreements
|
265,195
|
3%
|
277,900
|
3%
|
298,816
|
3%
|
263,663
|
3%
|
223,917
|
3%
|
||
|
Total core funding
|
7,877,831
|
89%
|
8,085,507
|
89%
|
8,118,878
|
89%
|
7,732,012
|
88%
|
8,288,663
|
87%
|
||
|
Wholesale funding:
|
||||||||||||
|
Public funds - certificates of deposit
|
72,112
|
1%
|
90,754
|
1%
|
76,863
|
1%
|
94,084
|
1%
|
90,219
|
1%
|
||
|
Brokered deposit accounts
|
468,210
|
5%
|
498,264
|
5%
|
500,342
|
5%
|
492,746
|
5%
|
528,311
|
6%
|
||
|
Other short-term borrowings
|
3,649
|
-
|
4,464
|
-
|
3,271
|
-
|
-
|
-
|
100,000
|
1%
|
||
|
Long-term borrowings
|
235,073
|
2%
|
244,529
|
2%
|
256,569
|
2%
|
270,090
|
3%
|
281,349
|
2%
|
||
|
Subordinated debt
|
50,000
|
1%
|
50,000
|
1%
|
50,000
|
1%
|
50,000
|
1%
|
50,000
|
1%
|
||
|
Junior subordinated notes issued
|
||||||||||||
|
to capital trusts
|
158,571
|
2%
|
158,579
|
2%
|
158,605
|
2%
|
158,641
|
2%
|
158,677
|
2%
|
||
|
Total wholesale funding
|
987,615
|
11%
|
1,046,590
|
11%
|
1,045,650
|
11%
|
1,065,561
|
12%
|
1,208,556
|
13%
|
||
|
Total funding
|
$ 8,865,446
|
100%
|
$ 9,132,097
|
100%
|
$ 9,164,528
|
100%
|
$ 8,797,573
|
100%
|
$ 9,497,219
|
100%
|
||
16
FORWARD-LOOKING STATEMENTS
When used in this press release and in reports filed with or furnished to the Securities and Exchange Commission, in press releases or other public stockholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases “believe,” “will,” “should,” “will likely result,” “are expected to,” “will continue” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. These statements may relate to our future financial performance, strategic plans or objectives, revenues or earnings projections, or other financial items. By their nature, these statements are subject to numerous uncertainties that could cause actual results to differ materially from those anticipated in the statements.
Important factors that could cause actual results to differ materially from the results anticipated or projected include, but are not limited to, the following: (1) expected cost savings, synergies and other benefits from our merger and acquisition activities might not be realized within the anticipated time frames or at all, and costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected; (2) the possibility that the expected benefits of the Broadway Bank, New Century Bank and other FDIC-assisted transactions we previously completed will not be realized; (3) the credit risks of lending activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses, which could necessitate additional provisions for loan losses, resulting both from loans we originate and loans we acquire from other financial institutions; (4) results of examinations by the Office of Comptroller of Currency and other regulatory authorities, including the possibility that any such regulatory authority may, among other things, require us to increase our allowance for loan losses or write-down assets; (5) competitive pressures among depository institutions; (6) interest rate movements and their impact on customer behavior and net interest margin; (7) the impact of repricing and competitors’ pricing initiatives on loan and deposit products; (8) fluctuations in real estate values; (9) the ability to adapt successfully to technological changes to meet customers’ needs and developments in the market place; (10) our ability to realize the residual values of our direct finance, leveraged, and operating leases; (11) our ability to access cost-effective funding; (12) changes in financial markets; (13) changes in economic conditions in general and in the Chicago metropolitan area in particular; (14) the costs, effects and outcomes of litigation; (15) new legislation or regulatory changes, including but not limited to the Dodd-Frank Wall Street Reform and Consumer Protection Act and regulations adopted thereunder, changes in federal and/or state tax laws or interpretations thereof by taxing authorities, changes in laws, rules or regulations applicable to companies that have participated in the TARP Capital Purchase Program of the U.S. Department of the Treasury and other governmental initiatives affecting the financial services industry; (16) changes in accounting principles, policies or guidelines; (17) our future acquisitions of other depository institutions or lines of business; and (18) future goodwill impairment due to changes in our business, changes in market conditions, or other factors.
We do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date on which the forward-looking statement is made.
TABLES TO FOLLOW
17
MB FINANCIAL, INC. & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Unaudited)
As of the dates indicated
(Amounts in thousands)
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|||
|
2010
|
2010
|
2010
|
2010
|
2009
|
|||
|
ASSETS
|
|||||||
|
Cash and due from banks
|
$ 106,726
|
$ 131,381
|
$ 115,450
|
$ 113,664
|
$ 136,763
|
||
|
Interest earning deposits with banks
|
737,433
|
857,997
|
262,828
|
430,366
|
265,257
|
||
|
Total cash and cash equivalents
|
844,159
|
989,378
|
378,278
|
544,030
|
402,020
|
||
|
Investment securities:
|
|||||||
|
Securities available for sale, at fair value
|
1,597,743
|
1,319,665
|
1,769,207
|
2,150,491
|
2,843,233
|
||
|
Non-marketable securities - FHLB and FRB Stock
|
80,186
|
78,807
|
78,807
|
70,361
|
70,361
|
||
|
Total investment securities
|
1,677,929
|
1,398,472
|
1,848,014
|
2,220,852
|
2,913,594
|
||
|
Loans:
|
|||||||
|
Total loans excluding covered loans
|
5,805,481
|
5,989,948
|
6,149,786
|
6,259,805
|
6,350,951
|
||
|
Covered loans(1)
|
812,330
|
859,038
|
879,909
|
155,051
|
173,596
|
||
|
Total loans
|
6,617,811
|
6,848,986
|
7,029,695
|
6,414,856
|
6,524,547
|
||
|
Less allowance for loan loss
|
192,217
|
193,926
|
195,612
|
177,787
|
177,072
|
||
|
Net loans
|
6,425,594
|
6,655,060
|
6,834,083
|
6,237,069
|
6,347,475
|
||
|
Lease investments, net
|
126,906
|
131,324
|
143,143
|
138,929
|
144,966
|
||
|
Premises and equipment, net
|
210,886
|
185,064
|
180,714
|
181,394
|
179,641
|
||
|
Cash surrender value of life insurance
|
125,046
|
124,116
|
123,324
|
122,618
|
121,946
|
||
|
Goodwill, net
|
387,069
|
387,069
|
387,069
|
387,069
|
387,069
|
||
|
Other intangibles, net
|
35,159
|
36,285
|
35,199
|
36,198
|
37,708
|
||
|
Other real estate owned
|
71,476
|
59,114
|
43,988
|
41,589
|
36,711
|
||
|
Other real estate owned related to FDIC transactions
|
44,745
|
63,495
|
75,205
|
24,927
|
18,759
|
||
|
FDIC indemnification asset(1)
|
215,460
|
380,342
|
377,060
|
40,818
|
42,212
|
||
|
Other assets
|
155,935
|
198,845
|
231,888
|
209,747
|
233,292
|
||
|
Total assets
|
$ 10,320,364
|
$ 10,608,564
|
$ 10,657,965
|
$ 10,185,240
|
$ 10,865,393
|
||
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|||||||
|
Liabilities
|
|||||||
|
Deposits:
|
|||||||
|
Noninterest bearing
|
$ 1,691,599
|
$ 1,704,142
|
$ 1,604,482
|
$ 1,424,746
|
$ 1,552,185
|
||
|
Interest bearing
|
6,461,359
|
6,692,483
|
6,792,785
|
6,630,433
|
7,131,091
|
||
|
Total deposits
|
8,152,958
|
8,396,625
|
8,397,267
|
8,055,179
|
8,683,276
|
||
|
Short-term borrowings
|
268,844
|
282,364
|
302,087
|
263,663
|
323,917
|
||
|
Long-term borrowings
|
285,073
|
294,529
|
306,569
|
320,090
|
331,349
|
||
|
Junior subordinated notes issued to capital trusts
|
158,571
|
158,579
|
158,605
|
158,641
|
158,677
|
||
|
Accrued expenses and other liabilities
|
110,132
|
140,553
|
148,524
|
95,189
|
116,994
|
||
|
Total liabilities
|
8,975,578
|
9,272,650
|
9,313,052
|
8,892,762
|
9,614,213
|
||
|
Stockholders' Equity
|
|||||||
|
Preferred stock
|
194,104
|
193,956
|
193,809
|
193,665
|
193,522
|
||
|
Common stock
|
546
|
540
|
538
|
527
|
511
|
||
|
Additional paid-in capital
|
725,400
|
716,294
|
714,882
|
689,353
|
656,595
|
||
|
Retained earnings
|
402,810
|
402,754
|
408,991
|
392,931
|
395,170
|
||
|
Accumulated other comprehensive income
|
22,233
|
22,655
|
26,783
|
15,874
|
5,546
|
||
|
Treasury stock
|
(2,828)
|
(2,806)
|
(2,632)
|
(2,423)
|
(2,715)
|
||
|
Controlling interest stockholders' equity
|
1,342,265
|
1,333,393
|
1,342,371
|
1,289,927
|
1,248,629
|
||
|
Noncontrolling interest
|
2,521
|
2,521
|
2,542
|
2,551
|
2,551
|
||
|
Total stockholders' equity
|
1,344,786
|
1,335,914
|
1,344,913
|
1,292,478
|
1,251,180
|
||
|
Total liabilities and stockholders' equity
|
$ 10,320,364
|
$ 10,608,564
|
$ 10,657,965
|
$ 10,185,240
|
$ 10,865,393
|
||
|
(1)
|
“Covered loans” and “FDIC indemnification asset” refer to assets MB Financial Bank acquired in loss-share transactions facilitated by the FDIC. The “FDIC indemnification asset” represents the present value of the amounts the Company expects MB Financial Bank to collect from the FDIC pursuant to loss-share agreements with respect to covered loans and other real estate owned related to the FDIC transactions.
|
18
MB FINANCIAL, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)(Unaudited)
|
Three Months Ended
|
Year Ended
|
||||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
|||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
|||
|
Interest income:
|
|||||||||
|
Loans
|
$ 92,701
|
$ 94,697
|
$ 94,699
|
$ 82,387
|
$ 84,015
|
$ 364,484
|
$ 331,270
|
||
|
Investment securities available for sale:
|
|||||||||
|
Taxable
|
7,001
|
11,420
|
12,154
|
19,966
|
22,039
|
50,541
|
45,777
|
||
|
Nontaxable
|
3,367
|
3,387
|
3,403
|
3,428
|
3,498
|
13,585
|
14,754
|
||
|
Federal funds sold
|
-
|
-
|
-
|
2
|
-
|
2
|
-
|
||
|
Other interest bearing accounts
|
504
|
248
|
185
|
91
|
698
|
1,028
|
1,737
|
||
|
Total interest income
|
103,573
|
109,752
|
110,441
|
105,874
|
110,250
|
429,640
|
393,538
|
||
|
Interest expense:
|
|||||||||
|
Deposits
|
15,598
|
18,597
|
20,283
|
21,372
|
31,396
|
75,850
|
121,614
|
||
|
Short-term borrowings
|
255
|
281
|
264
|
345
|
1,142
|
1,145
|
5,166
|
||
|
Long-term borrowings & junior subordinated notes
|
3,065
|
3,256
|
3,213
|
3,339
|
3,511
|
12,873
|
16,206
|
||
|
Total interest expense
|
18,918
|
22,134
|
23,760
|
25,056
|
36,049
|
89,868
|
142,986
|
||
|
Net interest income
|
84,655
|
87,618
|
86,681
|
80,818
|
74,201
|
339,772
|
250,552
|
||
|
Provision for loan losses
|
49,000
|
65,000
|
85,000
|
47,200
|
70,000
|
246,200
|
231,800
|
||
|
Net interest income after provision for loan losses
|
35,655
|
22,618
|
1,681
|
33,618
|
4,201
|
93,572
|
18,752
|
||
|
Other income:
|
|||||||||
|
Loan service fees
|
1,532
|
1,659
|
2,042
|
1,284
|
1,723
|
6,517
|
6,913
|
||
|
Deposit service fees
|
9,920
|
10,705
|
9,461
|
8,848
|
9,311
|
38,934
|
30,600
|
||
|
Lease financing, net
|
7,185
|
5,022
|
5,026
|
4,620
|
5,799
|
21,853
|
18,528
|
||
|
Brokerage fees
|
1,231
|
1,407
|
1,129
|
1,245
|
1,272
|
5,012
|
4,606
|
||
|
Trust & asset management fees
|
4,243
|
3,923
|
3,536
|
3,335
|
3,347
|
15,037
|
12,593
|
||
|
Net gain on sale of investment securities
|
(4)
|
9,482
|
2,304
|
6,866
|
239
|
18,648
|
14,029
|
||
|
Increase in cash surrender value of life insurance
|
930
|
1,209
|
706
|
671
|
669
|
3,516
|
2,459
|
||
|
Net gain (loss) on sale of other assets
|
419
|
299
|
(99)
|
11
|
12
|
630
|
(13)
|
||
|
Acquisition related gains
|
-
|
-
|
62,649
|
-
|
18,325
|
62,649
|
28,547
|
||
|
Other operating income
|
5,339
|
2,092
|
5,952
|
(423)
|
2,230
|
12,960
|
8,892
|
||
|
Total other income
|
30,795
|
35,798
|
92,706
|
26,457
|
42,927
|
185,756
|
127,154
|
||
|
Other expense:
|
|||||||||
|
Salaries & employee benefits
|
36,399
|
37,424
|
37,104
|
33,422
|
33,391
|
144,349
|
120,654
|
||
|
Occupancy & equipment expense
|
7,938
|
8,800
|
8,928
|
9,179
|
8,885
|
34,845
|
31,521
|
||
|
Computer services expense
|
2,445
|
2,654
|
3,322
|
2,528
|
2,882
|
10,949
|
10,011
|
||
|
Advertising & marketing expense
|
1,573
|
1,620
|
1,639
|
1,633
|
683
|
6,465
|
4,185
|
||
|
Professional & legal expense
|
1,718
|
1,637
|
1,370
|
1,078
|
1,465
|
5,803
|
4,680
|
||
|
Brokerage fee expense
|
448
|
596
|
420
|
462
|
553
|
1,926
|
1,999
|
||
|
Telecommunication expense
|
819
|
975
|
964
|
908
|
1,127
|
3,666
|
3,433
|
||
|
Other intangible amortization expense
|
1,632
|
1,567
|
1,505
|
1,510
|
1,650
|
6,214
|
4,491
|
||
|
FDIC insurance premiums
|
3,930
|
3,873
|
3,833
|
3,964
|
4,099
|
15,600
|
16,762
|
||
|
Impairment charges
|
-
|
-
|
-
|
-
|
-
|
-
|
4,000
|
||
|
Other real estate expense, net
|
858
|
734
|
417
|
685
|
245
|
2,694
|
871
|
||
|
Other operating expenses
|
6,855
|
6,598
|
6,530
|
6,282
|
6,092
|
26,265
|
21,143
|
||
|
Total other expense
|
64,615
|
66,478
|
66,032
|
61,651
|
61,072
|
258,776
|
223,750
|
||
|
Income (loss) before income taxes
|
1,835
|
(8,062)
|
28,355
|
(1,576)
|
(13,944)
|
20,552
|
(77,844)
|
||
|
Income tax expense (benefit)
|
(1,358)
|
(5,253)
|
9,158
|
(2,523)
|
(4,164)
|
24
|
(45,265)
|
||
|
Income (loss) from continuing operations
|
3,193
|
(2,809)
|
19,197
|
947
|
(9,780)
|
20,528
|
(32,579)
|
||
|
Income from discontinued operations, net of tax
|
-
|
-
|
-
|
-
|
-
|
-
|
6,453
|
||
|
Net income (loss)
|
3,193
|
(2,809)
|
19,197
|
947
|
(9,780)
|
20,528
|
(26,126)
|
||
|
Preferred stock dividends and discount accretion
|
2,598
|
2,597
|
2,594
|
2,593
|
2,591
|
10,382
|
10,298
|
||
|
Net income (loss) available to common stockholders
|
$ 595
|
$ (5,406)
|
$ 16,603
|
$ (1,646)
|
$ (12,371)
|
$ 10,146
|
$ (36,424)
|
||
19
|
Three Months Ended
|
Year Ended
|
|||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
||
|
Common share data:
|
||||||||
|
Basic earnings (loss) per common share from continuing operations
|
$ 0.06
|
$ (0.05)
|
$ 0.36
|
$ 0.02
|
$ (0.19)
|
$ 0.39
|
$ (0.81)
|
|
|
Basic earnings per common share from discontinued operations
|
$ -
|
$ -
|
$ -
|
$ -
|
$ -
|
$ -
|
$ 0.16
|
|
|
Impact of preferred stock dividends on basic earnings (loss) per common share
|
$ (0.05)
|
$ (0.05)
|
$ (0.05)
|
$ (0.05)
|
$ (0.05)
|
$ (0.20)
|
$ (0.26)
|
|
|
Basic earnings (loss) per common share
|
$ 0.01
|
$ (0.10)
|
$ 0.31
|
$ (0.03)
|
$ (0.25)
|
$ 0.19
|
$ (0.91)
|
|
|
Diluted earnings (loss) per common share from continuing operations
|
$ 0.06
|
$ (0.05)
|
$ 0.36
|
$ 0.02
|
$ (0.19)
|
$ 0.39
|
$ (0.81)
|
|
|
Diluted earnings per common share from discontinued operations
|
$ -
|
$ -
|
$ -
|
$ -
|
$ -
|
$ -
|
$ 0.16
|
|
|
Impact of preferred stock dividends on diluted earnings (loss) per common share
|
$ (0.05)
|
$ (0.05)
|
$ (0.05)
|
$ (0.05)
|
$ (0.05)
|
$ (0.20)
|
$ (0.26)
|
|
|
Diluted earnings (loss) per common share
|
$ 0.01
|
$ (0.10)
|
$ 0.31
|
$ (0.03)
|
$ (0.25)
|
$ 0.19
|
$ (0.91)
|
|
|
Weighted average common shares outstanding
|
53,572,157
|
53,327,219
|
52,702,779
|
51,264,727
|
50,279,008
|
52,724,715
|
40,042,655
|
|
|
Diluted weighted average common shares outstanding
|
53,790,047
|
53,327,219
|
53,034,426
|
51,264,727
|
50,279,008
|
53,035,047
|
40,042,655
|
|
20
|
Three Months Ended
|
Year Ended
|
||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
|
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
|
|
Performance Ratios:
|
|||||||
|
Annualized return on average assets
|
0.12%
|
(0.10%)
|
0.73%
|
0.04%
|
(0.33%)
|
0.20%
|
(0.27%)
|
|
Annualized return on average common equity
|
0.21
|
(1.86)
|
5.79
|
(0.61)
|
(4.54)
|
0.89
|
(3.91)
|
|
Annualized cash return on average tangible common equity(1)
|
0.89
|
(2.34)
|
9.52
|
(0.40)
|
(6.69)
|
1.96
|
(6.36)
|
|
Net interest rate spread
|
3.63
|
3.71
|
3.69
|
3.42
|
2.54
|
3.61
|
2.62
|
|
Cost of funds(2)
|
0.83
|
0.96
|
1.04
|
1.13
|
1.38
|
0.99
|
1.67
|
|
Efficiency ratio(3)
|
53.72
|
55.32
|
56.39
|
58.00
|
59.48
|
55.80
|
62.29
|
|
Annualized net non-interest expense to average assets(4)
|
1.22
|
1.36
|
1.45
|
1.52
|
1.21
|
1.39
|
1.34
|
|
Core pre-tax pre-provision earnings to risk-weighted assets(5)
|
3.08
|
2.91
|
2.71
|
2.41
|
2.07
|
2.87
|
1.58
|
|
Net interest margin
|
3.72
|
3.81
|
3.79
|
3.55
|
2.74
|
3.72
|
2.85
|
|
Tax equivalent effect
|
0.11
|
0.11
|
0.12
|
0.12
|
0.12
|
0.11
|
0.12
|
|
Net interest margin - fully tax equivalent basis(6)
|
3.83
|
3.92
|
3.91
|
3.67
|
2.86
|
3.83
|
2.97
|
|
Asset Quality Ratios:
|
|||||||
|
Non-performing loans(7) to total loans
|
5.48%
|
5.73%
|
4.89%
|
5.04%
|
4.16%
|
5.48%
|
4.16%
|
|
Non-performing assets(7) to total assets
|
4.21
|
4.26
|
3.64
|
3.58
|
2.84
|
4.21
|
2.84
|
|
Allowance for loan losses to non-performing loans(7)
|
53.03
|
49.40
|
56.89
|
55.01
|
65.26
|
53.03
|
65.26
|
|
Allowance for loan losses to non-performing loans,(7)
|
|||||||
|
including partial charge-offs taken
|
67.66
|
64.78
|
69.55
|
65.31
|
72.34
|
67.66
|
72.34
|
|
Allowance for loan losses to total loans
|
2.90
|
2.83
|
2.78
|
2.77
|
2.71
|
2.90
|
2.71
|
|
Net loan charge-offs to average loans (annualized)
|
2.99
|
3.81
|
3.89
|
2.93
|
5.05
|
3.42
|
3.09
|
|
Capital Ratios:
|
|||||||
|
Tangible equity to tangible assets(8)
|
9.43%
|
9.07%
|
9.12%
|
9.02%
|
8.03%
|
9.43%
|
8.03%
|
|
Tangible common equity to risk weighted assets(9)
|
10.94
|
10.49
|
10.31
|
9.73
|
8.83
|
10.94
|
8.83
|
|
Tangible common equity to tangible assets(10)
|
7.47
|
7.17
|
7.23
|
7.04
|
6.18
|
7.47
|
6.18
|
|
Book value per common share(11)
|
$ 21.33
|
$ 21.17
|
$ 21.40
|
$ 20.85
|
$ 20.75
|
$ 21.33
|
$ 20.75
|
|
Less: goodwill and other intangible assets, net of tax
|
|||||||
|
benefit, per common share
|
7.60
|
7.62
|
7.60
|
7.79
|
8.07
|
7.60
|
8.07
|
|
Tangible book value per common share(12)
|
13.72
|
13.55
|
13.78
|
13.06
|
12.68
|
13.72
|
12.68
|
|
Total capital (to risk-weighted assets)
|
17.75%
|
17.14%
|
16.77%
|
16.39%
|
15.45%
|
17.75%
|
15.45%
|
|
Tier 1 capital (to risk-weighted assets)
|
15.75
|
15.15
|
14.81
|
14.42
|
13.51
|
15.75
|
13.51
|
|
Tier 1 capital (to average assets)
|
10.66
|
10.38
|
10.48
|
10.30
|
8.71
|
10.66
|
8.71
|
|
Tier 1 common capital (to risk-weighted assets)
|
10.61
|
10.17
|
9.96
|
9.51
|
8.76
|
10.61
|
8.76
|
|
(1)
|
Net cash flow available to common stockholders (net income available to common stockholders, plus other intangibles amortization expense, net of tax benefit) divided by average tangible common equity (average common equity less average goodwill and average other intangibles, net of tax benefit).
|
|
(2)
|
Equals total interest expense divided by the sum of average interest bearing liabilities and noninterest bearing deposits.
|
|
(3)
|
Equals total other expense excluding non-core items divided by the sum of net interest income on a fully tax equivalent basis and total other income less non-core items.
|
|
(4)
|
Equals total other expense excluding non-core items less total other income excluding non-core items divided by average assets.
|
|
(5)
|
Equal net income before taxes excluding loan loss provision expense, non-core other income items, and non-core other expense items divided by risk-weighted assets.
|
|
(6)
|
Represents net interest income, on a fully tax equivalent basis assuming a 35% tax rate, as a percentage of average interest earning assets.
|
|
(7)
|
Non-performing loans excludes purchased credit-impaired loans and loans held for sale. Non-performing assets excludes purchased credit-impaired loans, loans held for sale, and other real estate owned related to FDIC transactions.
|
|
(8)
|
Equals total ending stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by total assets less goodwill and other intangibles, net of tax benefit.
|
|
(9)
|
Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by total risk weighted assets.
|
|
(10)
|
Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by total assets less goodwill and other intangibles, net of tax benefit.
|
|
(11)
|
Equals total ending common stockholders’ equity divided by common shares outstanding.
|
|
(12)
|
Equals total ending common stockholders’ equity less goodwill and other intangibles, net of tax benefit, divided by common shares outstanding.
|
21
NON-GAAP FINANCIAL INFORMATION
This press release contains certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (GAAP). These measures include pre-tax, pre-provision earnings; core pre-tax, pre-provision earnings; net interest income on a fully tax equivalent basis, net interest margin on a fully tax equivalent basis; efficiency ratio, ratio of annualized net non-interest expense to average assets, and ratio of core pre-tax, pre-provision earnings to risk-weighted assets, with net gains and losses on securities available for sale, net gains and losses on sale of other assets, net gains and losses on other real estate owned, acquisition related gains and increase (decrease) in market value of assets held in trust for deferred compensation excluded from the non-interest income components, the FDIC special assessment expense, impairment charges and increase (decrease) in market value of assets held in trust for deferred compensation excluded from the non-interest expense components of these ratios; ratios of tangible equity to tangible assets, tangible common equity to risk weighted assets, tangible common equity to tangible assets and Tier 1 common capital to risk-weighted assets; tangible book value per common share; and annualized cash return on average tangible common equity. Our management uses these non-GAAP measures in its analysis of our performance. Management believes that pre-tax, pre-provision earnings are a useful measure in assessing our core operating performance, particularly during times of economic stress. The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 35% tax rate. Management believes that it is a standard practice in the banking industry to present net interest income and net interest margin on a fully tax equivalent basis, and accordingly believes that providing these measures may be useful for peer comparison purposes. Management also believes that by excluding net gains and losses on securities available for sale, net gains and losses on sale of other assets, net gains and losses on other real estate owned, acquisition-related gains and increase (decrease) in market value of assets held in trust for deferred compensation from the non-interest income component and excluding the FDIC special assessment expense, impairment changes and increase (decrease) in market value of assets held in trust for deferred compensation from other non-interest expense of the efficiency ratio, the ratio of annualized net non-interest expense to average assets and the ratio of core pre-tax, pre-provision earnings to risk-weighted assets, these ratios better reflect our core operating performance. In addition, management believes that presenting the ratio of Tier 1 common equity to risk weighted assets is useful for assessing our capital strength and for peer comparison purposes. The other measures exclude the ending balances of acquisition-related goodwill and other intangible assets, net of tax benefit, in determining tangible stockholders’ equity. Management believes the presentation of these other financial measures excluding the impact of such items provides useful supplemental information that is helpful in understanding our financial results, as they provide a method to assess management’s success in utilizing our tangible capital. These disclosures should not be viewed as substitutes for the results determined to be in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
The following table presents a reconciliation of tangible equity to equity (in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||
|
Stockholders' equity - as reported
|
$ 1,344,786
|
$ 1,335,914
|
$ 1,344,913
|
$ 1,292,478
|
$ 1,251,180
|
|
|
Less: goodwill
|
387,069
|
387,069
|
387,069
|
387,069
|
387,069
|
|
|
Less: other intangible, net of tax benefit
|
22,853
|
23,585
|
22,879
|
23,529
|
24,510
|
|
|
Tangible equity
|
$ 934,864
|
$ 925,260
|
$ 934,965
|
$ 881,880
|
$ 839,601
|
|
The following table presents a reconciliation of tangible assets to total assets (in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||
|
Total assets - as reported
|
$ 10,320,364
|
$ 10,608,564
|
$ 10,657,965
|
$ 10,185,240
|
$ 10,865,393
|
|
|
Less: goodwill
|
387,069
|
387,069
|
387,069
|
387,069
|
387,069
|
|
|
Less: other intangible, net of tax benefit
|
22,853
|
23,585
|
22,879
|
23,529
|
24,510
|
|
|
Tangible assets
|
$ 9,910,442
|
$ 10,197,910
|
$ 10,248,017
|
$ 9,774,642
|
$ 10,453,814
|
|
22
The following table presents a reconciliation of tangible common equity to stockholders’ common equity (in thousands):
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
||
|
Common stockholders' equity - as reported
|
$ 1,150,682
|
$ 1,141,958
|
$ 1,151,104
|
$ 1,098,813
|
$ 1,057,658
|
|
|
Less: goodwill
|
387,069
|
387,069
|
387,069
|
387,069
|
387,069
|
|
|
Less: other intangible, net of tax benefit
|
22,853
|
23,585
|
22,879
|
23,529
|
24,510
|
|
|
Tangible common equity
|
$ 740,760
|
$ 731,304
|
$ 741,156
|
$ 688,215
|
$ 646,079
|
|
The following table presents a reconciliation of average tangible common equity to average common stockholders’ equity (in thousands):
|
Three Months Ended
|
Year Ended
|
|||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
||
|
Average common stockholders' equity - as reported
|
$ 1,147,581
|
$ 1,152,058
|
$ 1,150,440
|
$ 1,089,859
|
$ 1,081,794
|
$ 1,135,189
|
$ 932,509
|
|
|
Less: average goodwill
|
387,069
|
387,069
|
387,069
|
387,069
|
387,069
|
387,069
|
387,069
|
|
|
Less: average other intangible assets,
|
||||||||
|
net of tax benefit
|
23,236
|
22,596
|
22,905
|
23,892
|
25,128
|
23,154
|
18,971
|
|
|
Average tangible common equity
|
$ 737,276
|
$ 742,393
|
$ 740,466
|
$ 678,898
|
$ 669,597
|
$ 724,966
|
$ 526,469
|
|
The following table presents a reconciliation of net cash flow available to common stockholders to net (loss) income available to common stockholders (in thousands):
|
Three Months Ended
|
Year Ended
|
|||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
||
|
Net (loss) income available to common
|
||||||||
|
stockholders - as reported
|
$ 595
|
$ (5,406)
|
$ 16,603
|
$ (1,646)
|
$ (12,371)
|
$ 10,146
|
$ (36,424)
|
|
| Add: other intangible amortization expense, | ||||||||
|
net of tax benefit
|
1,062
|
1,018
|
978
|
981
|
1,073
|
4,039
|
2,919
|
|
|
Net cash flow available to common stockholders
|
$ 1,657
|
$ (4,388)
|
$ 17,581
|
$ (665)
|
$ (11,299)
|
$ 14,185
|
$ (33,505)
|
|
23
Efficiency Ratio Calculation (Dollars in Thousands)
|
Three Months Ended
|
Year Ended
|
|||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
||
|
Non-interest expense
|
$ 64,615
|
$ 66,478
|
$ 66,032
|
$ 61,651
|
$ 61,072
|
$ 258,776
|
$ 223,750
|
|
|
Adjustment for FDIC special assessment
|
-
|
-
|
-
|
-
|
-
|
-
|
3,850
|
|
|
Adjustment for impairment charges
|
-
|
-
|
-
|
-
|
-
|
-
|
4,000
|
|
|
Adjustment for increase (decrease) in market value of assets held in
|
||||||||
|
trust for deferred compensation
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
|
|
Non-interest expense - as adjusted
|
$ 64,018
|
$ 66,481
|
$ 66,071
|
$ 61,644
|
$ 60,772
|
$ 258,214
|
$ 215,190
|
|
|
Net interest income
|
$ 84,655
|
$ 87,618
|
$ 86,681
|
$ 80,818
|
$ 74,201
|
$ 339,772
|
$ 250,552
|
|
|
Tax equivalent adjustment
|
2,609
|
2,614
|
2,642
|
2,593
|
3,195
|
10,458
|
10,625
|
|
|
Net interest income on a fully tax equivalent basis
|
87,264
|
90,232
|
89,323
|
83,411
|
77,396
|
350,230
|
261,177
|
|
|
Plus other income
|
30,795
|
35,798
|
92,706
|
26,457
|
42,927
|
185,756
|
127,154
|
|
|
Less net (losses) gains on other real estate owned
|
(2,124)
|
(3,913)
|
52
|
(3,299)
|
(733)
|
(9,284)
|
(429)
|
|
|
Less net (losses) gains on securities available for sale
|
(4)
|
9,482
|
2,304
|
6,866
|
239
|
18,648
|
14,029
|
|
|
Less net gains (losses) on sale of other assets
|
419
|
299
|
(99)
|
11
|
12
|
630
|
(13)
|
|
|
Less acquisition related gains
|
-
|
-
|
62,649
|
-
|
18,325
|
62,649
|
28,547
|
|
|
Less increase (decrease) in market value of assets held in
|
||||||||
|
trust for deferred compensation
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
|
|
Net interest income plus non-interest income -
|
||||||||
|
as adjusted
|
$ 119,171
|
$ 120,165
|
$ 117,162
|
$ 106,283
|
$ 102,180
|
$ 462,781
|
$ 345,487
|
|
|
Efficiency ratio
|
53.72%
|
55.32%
|
56.39%
|
58.00%
|
59.48%
|
55.80%
|
62.29%
|
|
|
Efficiency ratio (without adjustments)
|
55.97%
|
53.86%
|
36.81%
|
57.47%
|
52.14%
|
49.24%
|
59.24%
|
|
Annualized Net Non-interest Expense to Average Assets Calculation (Dollars in Thousands)
|
Three Months Ended
|
Year Ended
|
|||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
||
|
Non-interest expense
|
$ 64,615
|
$ 66,478
|
$ 66,032
|
$ 61,651
|
$ 61,072
|
$ 258,776
|
$ 223,750
|
|
|
Adjustment for FDIC special assessment
|
-
|
-
|
-
|
-
|
-
|
-
|
3,850
|
|
|
Adjustment for impairment charges
|
-
|
-
|
-
|
-
|
-
|
-
|
4,000
|
|
|
Adjustment for increase (decrease) in market value of assets held in
|
||||||||
|
trust for deferred compensation
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
|
|
Non-interest expense - as adjusted
|
64,018
|
66,481
|
66,071
|
61,644
|
60,772
|
258,214
|
215,190
|
|
|
Other income
|
30,795
|
35,798
|
92,706
|
26,457
|
42,927
|
185,756
|
127,154
|
|
|
Less net (losses) gains on other real estate owned
|
(2,124)
|
(3,913)
|
52
|
(3,299)
|
(733)
|
(9,284)
|
(429)
|
|
|
Less net (losses) gains on securities available for sale
|
(4)
|
9,482
|
2,304
|
6,866
|
239
|
18,648
|
14,029
|
|
|
Less net gains (loss) on sale of other assets
|
419
|
299
|
(99)
|
11
|
12
|
630
|
(13)
|
|
|
Less acquisition related gains
|
-
|
-
|
62,649
|
-
|
18,325
|
62,649
|
28,547
|
|
|
Less increase (decrease) in market value of assets held in
|
||||||||
|
trust for deferred compensation
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
|
|
Other income - as adjusted
|
31,907
|
29,933
|
27,839
|
22,872
|
24,784
|
112,551
|
84,310
|
|
|
Net non-interest expense
|
$ 32,111
|
$ 36,548
|
$ 38,232
|
$ 38,772
|
$ 35,988
|
$ 145,663
|
$ 130,880
|
|
|
Average assets
|
10,452,626
|
10,634,556
|
10,584,722
|
10,349,664
|
11,786,792
|
10,506,028
|
9,777,287
|
|
|
Annualized net non-interest expense to average assets
|
1.22%
|
1.36%
|
1.45%
|
1.52%
|
1.21%
|
1.39%
|
1.34%
|
|
|
Annualized net non-interest expense to average assets
|
||||||||
|
(without adjustments)
|
1.28%
|
1.14%
|
-1.01%
|
1.38%
|
0.61%
|
0.70%
|
0.99%
|
|
24
Core Pre-Tax, Pre-Provision Earnings (Dollars in Thousands)
|
Three Months Ended
|
Year Ended
|
|||||||
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
December 31,
|
December 31,
|
||
|
2010
|
2010
|
2010
|
2010
|
2009
|
2010
|
2009
|
||
|
Income (loss) before income taxes
|
$ 1,835
|
$ (8,062)
|
$ 28,355
|
$ (1,576)
|
$ (13,944)
|
$ 20,552
|
$ (77,844)
|
|
|
Provision for loan losses
|
49,000
|
65,000
|
85,000
|
47,200
|
70,000
|
246,200
|
231,800
|
|
|
Pre-tax, pre-provision earnings
|
50,835
|
56,938
|
113,355
|
45,624
|
56,056
|
266,752
|
153,956
|
|
|
Non-core other income
|
||||||||
|
Net (losses) gains on other real estate owned
|
(2,124)
|
(3,913)
|
52
|
(3,299)
|
(733)
|
(9,284)
|
(429)
|
|
|
Net (losses) gains on securities available for sale
|
(4)
|
9,482
|
2,304
|
6,866
|
239
|
18,648
|
14,029
|
|
|
Net gain (loss) on sale of other assets
|
419
|
299
|
(99)
|
11
|
12
|
630
|
(13)
|
|
|
Acquisition related gains
|
-
|
-
|
62,649
|
-
|
18,325
|
62,649
|
28,547
|
|
|
Increase (decrease) in market value of assets held in
|
||||||||
|
trust for deferred compensation
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
|
|
Total non-core other income
|
(1,112)
|
5,865
|
64,867
|
3,585
|
18,143
|
73,205
|
42,844
|
|
|
Non-core other expense
|
||||||||
|
FDIC special assessment
|
-
|
-
|
-
|
-
|
-
|
-
|
3,850
|
|
|
Impairment charges
|
-
|
-
|
-
|
-
|
-
|
-
|
4,000
|
|
|
Increase (decrease) in market value of assets held in
|
||||||||
|
trust for deferred compensation
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
710
|
|
|
Total non-core other expense
|
597
|
(3)
|
(39)
|
7
|
300
|
562
|
8,560
|
|
|
Core pre-tax, pre-provision earnings
|
$ 52,544
|
$ 51,070
|
$ 48,449
|
$ 42,046
|
$ 38,213
|
$ 194,109
|
$ 119,672
|
|
|
Risk-weighted assets
|
6,772,761
|
6,971,810
|
7,172,094
|
7,074,274
|
7,315,068
|
6,772,761
|
7,568,022
|
|
|
Annualized pre-tax, pre-provision earnings to risk-
|
||||||||
|
weighted assets
|
3.08%
|
2.91%
|
2.71%
|
2.41%
|
2.07%
|
2.87%
|
1.58%
|
|
|
Annualized pre-tax, pre-provision earnings to risk-
|
||||||||
|
weighted assets (without adjustments)
|
2.98%
|
3.24%
|
6.34%
|
2.62%
|
3.04%
|
3.94%
|
2.03%
|
|
A reconciliation of net interest margin on a fully tax equivalent basis to net interest margin is contained in the tables under “Net Interest Margin.” A reconciliation of tangible book value per common share to book value per common share is contained in the “Selected Financial Ratios” table.
25
NET INTEREST MARGIN
The following table presents, for the periods indicated, the total dollar amount of interest income from average interest earning assets and the resultant yields, as well as the interest expense on average interest bearing liabilities, and the resultant costs, expressed both in dollars and rates (dollars in thousands):
|
Three Months Ended December 31,
|
Three Months Ended September 30,
|
||||||||||
|
2010
|
2009
|
2010
|
|||||||||
|
Average
|
Yield/
|
Average
|
Yield/
|
Average
|
Yield/
|
||||||
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
|||
|
Interest Earning Assets:
|
|||||||||||
|
Loans (1) (2) (3):
|
|||||||||||
|
Commercial related credits
|
|||||||||||
|
Commercial
|
$ 1,243,057
|
$ 15,053
|
4.80%
|
$ 1,385,281
|
$ 18,118
|
5.19%
|
$ 1,307,155
|
$ 16,933
|
5.14%
|
||
|
Commercial loans collateralized by assignment
|
|||||||||||
|
of lease payments
|
1,018,026
|
14,662
|
5.76
|
892,789
|
13,849
|
6.20
|
989,412
|
14,706
|
5.95
|
||
|
Real estate commercial
|
2,235,328
|
29,853
|
5.23
|
2,456,381
|
33,513
|
5.34
|
2,316,143
|
30,706
|
5.19
|
||
|
Real estate construction
|
438,622
|
3,741
|
3.34
|
681,868
|
5,455
|
3.13
|
500,644
|
4,452
|
3.48
|
||
|
Total commercial related credits
|
4,935,033
|
63,309
|
5.02
|
5,416,319
|
70,935
|
5.12
|
5,113,354
|
66,797
|
5.11
|
||
|
Other loans
|
|||||||||||
|
Real estate residential
|
326,785
|
4,523
|
5.54
|
287,296
|
4,036
|
5.62
|
327,686
|
4,126
|
5.04
|
||
|
Home equity
|
385,119
|
4,234
|
4.36
|
407,044
|
4,496
|
4.38
|
389,996
|
4,284
|
4.36
|
||
|
Indirect
|
178,940
|
3,583
|
7.94
|
182,601
|
3,175
|
6.90
|
182,268
|
3,192
|
6.95
|
||
|
Consumer loans
|
57,709
|
633
|
4.35
|
58,768
|
582
|
3.93
|
58,166
|
500
|
3.41
|
||
|
Total other loans
|
948,553
|
12,973
|
5.43
|
935,709
|
12,289
|
5.21
|
958,116
|
12,102
|
5.01
|
||
|
Total loans, excluding covered loans
|
5,883,586
|
76,282
|
5.14
|
6,352,028
|
83,224
|
5.20
|
6,071,470
|
78,899
|
5.16
|
||
|
Covered loans
|
840,254
|
17,213
|
8.13
|
108,167
|
2,103
|
7.71
|
867,945
|
16,590
|
7.58
|
||
|
Total loans
|
6,723,840
|
93,495
|
5.52
|
6,460,195
|
85,327
|
5.22
|
6,939,415
|
95,489
|
5.46
|
||
|
Taxable investment securities
|
1,172,751
|
7,002
|
2.39
|
3,086,737
|
22,039
|
2.86
|
1,450,608
|
11,420
|
3.15
|
||
|
Investment securities exempt from federal income taxes (3)
|
351,955
|
5,181
|
5.76
|
367,848
|
5,381
|
5.72
|
355,288
|
5,210
|
5.74
|
||
|
Federal funds sold
|
-
|
-
|
0.00
|
-
|
-
|
0.00
|
-
|
-
|
0.00
|
||
|
Other interest bearing deposits
|
784,803
|
504
|
0.25
|
812,261
|
698
|
0.34
|
377,555
|
248
|
0.26
|
||
|
Total interest earning assets
|
$ 9,033,349
|
$ 106,182
|
4.66
|
$ 10,727,041
|
$ 113,445
|
4.20
|
$ 9,122,866
|
$ 112,367
|
4.89
|
||
|
Non-interest earning assets
|
1,419,277
|
1,059,751
|
1,511,690
|
||||||||
|
Total assets
|
$ 10,452,626
|
$ 11,786,792
|
$ 10,634,556
|
||||||||
|
Interest Bearing Liabilities:
|
|||||||||||
|
Core funding:
|
|||||||||||
|
Money market and NOW accounts
|
$ 2,823,619
|
$ 3,410
|
0.48%
|
$ 3,047,721
|
$ 5,523
|
0.72%
|
$ 2,789,046
|
$ 4,022
|
0.57%
|
||
|
Savings accounts
|
657,816
|
505
|
0.30
|
573,784
|
495
|
0.34
|
623,555
|
469
|
0.30
|
||
|
Certificate of deposit
|
2,529,865
|
7,481
|
1.17
|
3,529,995
|
20,225
|
2.27
|
2,740,219
|
9,546
|
1.38
|
||
|
Customer repurchase agreements
|
277,782
|
218
|
0.31
|
220,432
|
259
|
0.47
|
260,469
|
243
|
0.37
|
||
|
Total core funding
|
6,289,082
|
11,614
|
0.73
|
7,371,932
|
26,502
|
1.43
|
6,413,289
|
14,280
|
0.88
|
||
|
Whole sale funding:
|
|||||||||||
|
Public funds
|
81,500
|
128
|
0.62
|
100,246
|
257
|
1.02
|
80,339
|
132
|
0.65
|
||
|
Brokered accounts (includes fee expense)
|
473,090
|
4,074
|
3.42
|
546,457
|
4,896
|
3.55
|
485,676
|
4,427
|
3.62
|
||
|
Other short-term borrowings
|
4,106
|
38
|
3.67
|
138,434
|
883
|
2.53
|
4,279
|
39
|
3.62
|
||
|
Long-term borrowings
|
448,106
|
3,064
|
2.68
|
494,398
|
3,511
|
2.78
|
458,657
|
3,257
|
2.78
|
||
|
Total wholesale funding
|
1,006,802
|
7,304
|
2.88
|
1,279,535
|
9,547
|
2.96
|
1,028,951
|
7,855
|
3.03
|
||
|
Total interest bearing liabilities
|
$ 7,295,884
|
$ 18,918
|
1.03
|
$ 8,651,467
|
$ 36,049
|
1.65
|
$ 7,442,240
|
$ 22,135
|
1.18
|
||
|
Non-interest bearing deposits
|
1,694,179
|
1,737,347
|
1,673,259
|
||||||||
|
Other non-interest bearing liabilities
|
120,974
|
122,731
|
173,139
|
||||||||
|
Stockholders' equity
|
1,341,589
|
1,275,247
|
1,345,918
|
||||||||
|
Total liabilities and stockholders' equity
|
$ 10,452,626
|
$ 11,786,792
|
$ 10,634,556
|
||||||||
|
Net interest income/interest rate spread (4)
|
$ 87,264
|
3.63%
|
$ 77,396
|
2.54%
|
$ 90,232
|
3.71%
|
|||||
|
Taxable equivalent adjustment
|
2,609
|
3,195
|
2,614
|
||||||||
|
Net interest income, as reported
|
$ 84,655
|
$ 74,201
|
$ 87,618
|
||||||||
|
Net interest margin (5)
|
3.72%
|
2.74%
|
3.81%
|
||||||||
|
Tax equivalent effect
|
0.11%
|
0.12%
|
0.11%
|
||||||||
|
Net interest margin on a fully equivalent basis (5)
|
3.83%
|
2.86%
|
3.92%
|
||||||||
|
(1)
|
Non-accrual loans are included in average loans.
|
|
(2)
|
Interest income includes amortization of deferred loan origination fees of $1.0 million, $1.2 million, and $1.1 million for the three months ended December 31, 2010, December 31, 2009, and September 30, 2010, respectively.
|
|
(3)
|
Non-taxable loan and investment income is presented on a fully tax equivalent basis assuming a 35% tax rate.
|
|
(4)
|
Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis.
|
|
(5)
|
Net interest margin represents net interest income as a percentage of average interest earning assets.
|
26
The following table represents, for the period indicated, the total dollar amount of interest income from average interest earning assets and the resultant yields, as well as the interest expense on average interest bearing liabilities, and the resultant costs, expressed both in dollars and rates (dollars in thousands):
|
Year Ended December 31,
|
||||||||
|
2010
|
2009
|
|||||||
|
Average
|
Yield/
|
Average
|
Yield/
|
|||||
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
|||
|
Interest Earning Assets:
|
||||||||
|
Loans (1) (2) (3):
|
||||||||
|
Commercial related credits
|
||||||||
|
Commercial
|
$ 1,324,118
|
$ 66,121
|
4.99%
|
$ 1,445,313
|
$ 70,850
|
4.90%
|
||
|
Commercial loans collateralized by assignment
|
||||||||
|
of lease payments
|
981,384
|
58,807
|
5.99
|
808,759
|
50,155
|
6.20
|
||
|
Real estate commercial
|
2,345,202
|
125,115
|
5.26
|
2,407,377
|
130,426
|
5.34
|
||
|
Real estate construction
|
520,734
|
17,357
|
3.29
|
733,718
|
26,742
|
3.59
|
||
|
Total commercial related credits
|
5,171,438
|
267,400
|
5.10
|
5,395,167
|
278,173
|
5.09
|
||
|
Other loans
|
||||||||
|
Real estate residential
|
314,713
|
16,878
|
5.36
|
285,550
|
15,998
|
5.60
|
||
|
Home equity
|
394,142
|
17,317
|
4.39
|
407,793
|
17,947
|
4.40
|
||
|
Indirect
|
180,337
|
13,115
|
7.27
|
187,455
|
12,737
|
6.79
|
||
|
Consumer loans
|
58,834
|
2,209
|
3.75
|
57,985
|
2,337
|
4.03
|
||
|
Total other loans
|
948,026
|
49,519
|
5.22
|
938,783
|
49,019
|
5.22
|
||
|
Total loans, excluding covered loans
|
6,119,464
|
316,919
|
5.18
|
6,333,950
|
327,192
|
5.17
|
||
|
Covered loans
|
639,312
|
50,707
|
7.93
|
87,299
|
6,759
|
7.74
|
||
|
Total loans
|
6,758,776
|
367,626
|
5.44
|
6,421,249
|
333,951
|
5.20
|
||
|
Taxable investment securities
|
1,635,544
|
50,542
|
3.09
|
1,444,552
|
45,777
|
3.17
|
||
|
Investment securities exempt from federal income taxes (3)
|
356,496
|
20,900
|
5.78
|
391,071
|
22,698
|
5.72
|
||
|
Federal funds sold
|
352
|
2
|
0.56
|
-
|
-
|
-
|
||
|
Other interest bearing deposits
|
386,521
|
1,028
|
0.27
|
545,314
|
1,737
|
0.32
|
||
|
Total interest earning assets
|
$ 9,137,689
|
$ 440,098
|
4.82
|
$ 8,802,186
|
$ 404,163
|
4.59
|
||
|
Non-interest earning assets
|
1,368,339
|
975,101
|
||||||
|
Total assets
|
$ 10,506,028
|
$ 9,777,287
|
||||||
|
Interest Bearing Liabilities:
|
||||||||
|
Core funding:
|
||||||||
|
Money market and NOW accounts
|
$ 2,767,044
|
$ 14,965
|
0.54%
|
$ 2,098,530
|
$17,773
|
0.85%
|
||
|
Savings accounts
|
619,304
|
1,911
|
0.31
|
473,477
|
1,717
|
0.36
|
||
|
Certificate of deposit
|
2,754,492
|
40,481
|
1.47
|
2,924,218
|
75,416
|
2.58
|
||
|
Customer repurchase agreements
|
260,291
|
959
|
0.37
|
247,998
|
1,138
|
0.46
|
||
|
Total core funding
|
6,401,131
|
58,316
|
0.91
|
5,744,223
|
96,044
|
1.67
|
||
|
Whole sale funding:
|
||||||||
|
Public funds
|
91,754
|
604
|
0.66
|
133,547
|
2,026
|
1.52
|
||
|
Brokered accounts (includes fee expense)
|
489,211
|
17,889
|
3.66
|
667,560
|
24,682
|
3.70
|
||
|
Other short-term borrowings
|
7,960
|
186
|
2.34
|
201,550
|
4,028
|
2.00
|
||
|
Long-term borrowings
|
465,387
|
12,873
|
2.73
|
512,267
|
16,206
|
3.12
|
||
|
Total wholesale funding
|
1,054,312
|
31,552
|
2.99
|
1,514,924
|
46,942
|
3.10
|
||
|
Total interest bearing liabilities
|
$ 7,455,443
|
$ 89,868
|
1.21
|
$ 7,259,147
|
$ 142,986
|
1.97
|
||
|
Non-interest bearing deposits
|
1,594,504
|
1,307,021
|
||||||
|
Other non-interest bearing liabilities
|
127,099
|
85,890
|
||||||
|
Stockholders' equity
|
1,328,982
|
1,125,229
|
||||||
|
Total liabilities and stockholders' equity
|
$ 10,506,028
|
$ 9,777,287
|
||||||
|
Net interest income/interest rate spread (4)
|
$ 350,230
|
3.61%
|
$ 261,177
|
2.62%
|
||||
|
Taxable equivalent adjustment
|
10,458
|
10,625
|
||||||
|
Net interest income, as reported
|
$ 339,772
|
$ 250,552
|
||||||
|
Net interest margin (5)
|
3.72%
|
2.85%
|
||||||
|
Tax equivalent effect
|
0.11%
|
0.12%
|
||||||
|
Net interest margin on a fully equivalent basis (5)
|
3.83%
|
2.97%
|
||||||
|
(1)
|
Non-accrual loans are included in average loans.
|
|
(2)
|
Interest income includes amortization of deferred loan origination fees of $4.6 million and $5.1 million for the year ended December 31, 2010, and December 31, 2009, respectively.
|
|
(3)
|
Non-taxable loan and investment income is presented on a fully tax equivalent basis assuming a 35% tax rate.
|
|
(4)
|
Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis.
|
|
(5)
|
Net interest margin represents net interest income as a percentage of average interest earning assets.
|
27