AmSouth Reports Record Second Quarter Earnings of $167.0 Million or $.47 Per Share.BIRMINGHAM Birmingham, cities, United States Birmingham (bûr`mĭnghăm') 1 City (1990 pop. 265,968), seat of Jefferson co., N central Ala., in the Jones Valley near the southern end of the Appalachian system; founded and inc. , Ala ALA aminolevulinic acid. Ala alanine. ala (a´lah) pl. a´lae [L.] a winglike process. . -- AmSouth Bancorporation AmSouth Bancorporation was a bank holding company headquartered in Birmingham, Alabama, operated as a subsidiary of Regions Financial Corporation. AmSouth was previously known as First National Bank of Birmingham first organized in 1872. (NYSE NYSE See: New York Stock Exchange : ASO ASO arteriosclerosis obliterans. ASO 1 Administrative services organization, see there 2 Allele-specific–oligonucleotide hybridization 3 Anti-streptolysin O, see there ) today reported earnings for the second quarter ended June June: see month. 30, 2004, of $.47 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share compared to $.44 per diluted share reported for the second quarter of 2003. Net income for the second quarter of 2004 was a record $167.0 million versus $154.8 million for the same period in 2003. AmSouth's second quarter performance resulted in a return on average equity of 20.3 percent, a return on average assets of 1.41 percent and an efficiency ratio of 52.8 percent. "We are seeing strong growth across all of our lines of business as the economy continues to improve," said Dowd Dowd is a derivation of an ancient surname which was once common in Ireland but is now quite rare. The name Dowd is an Anglicisation of the original Ui Dubhda, through its more common form O'Dowd. Ritter rit·ter n. pl. ritter A knight. [German, from Middle High German riter, from Middle Dutch ridder, from r , AmSouth's chairman, president and chief executive officer. "With the competitive landscape changing with recent merger activity, we remain focused on our internal growth strategy and are taking advantage of the resulting opportunities in our already attractive Southeastern south·east n. 1. Abbr. SE The direction or point on the mariner's compass halfway between due south and due east, or 135° east of due north. 2. An area or region lying in the southeast. 3. markets." Net interest income was $361.4 million in the second quarter, $1.9 million higher than the previous quarter, while the net interest margin was 3.44 percent. Average loans for the quarter grew by $2.4 billion, an 8.4 percent increase over the same quarter in 2003. Average deposits were higher by $3.8 billion, or 13.4 percent during the same period, including a 13.8 percent increase in average low-cost deposits. Noninterest revenue, which includes earnings from service charges, trust, investment management services, securities gains and other sources of fee income, was $218.3 million for the quarter, an increase of $7.5 million, or 3.6 percent, compared with the same quarter in 2003. This increase came despite decreases in mortgage income and lower securities gains. Service charges increased 15.5 percent compared with the second quarter of 2003, trust income grew 16.9 percent over the same period, and investment service income rose 36.6 percent compared with the previous year. Noninterest expenses in the second quarter were $311.8 million, up 4.4 percent compared with the second quarter of 2003 but down $ 10.5 million compared with the first quarter, reflecting the effects of tighter expense controls. Net charge-offs were .35 percent of average net loans in the quarter, marking the lowest level of net charge-offs since the second quarter of 2000. The ratio of loan loss reserves to total loans was 1.22 percent at June 30, 2004, and continued to reflect improvement in credit quality trends and a shift in the loan portfolio mix to include a greater proportion of lower risk loans. Total nonperforming assets Nonperforming asset An asset that is not effectively producing income, such as an overdue loan. nonperforming asset An asset that produces no income. at June 30, 2004, were $135.6 million, or .43 percent of loans net of unearned income Unearned Income Any income that comes from investments and other sources unrelated to employment services. Notes: Examples of unearned income include interest from a savings account, bond interest, tips, alimony, and dividends from stock. , foreclosed properties and repossessions, their lowest level in 20 years. In the second quarter of 2003 nonperforming assets were $175.4 million, or .62 percent of loans. For supplemental financial information about the second quarter results, you may refer to the Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. filed by AmSouth with the Securities and Exchange Commission on July July: see month. 13, 2004, or visit the Investor Relations Investor relations The process by which the corporation communicates with its investors. Resource Center on AmSouth's web site at www.amsouth.com. About AmSouth AmSouth is a regional bank holding company with $48 billion in assets, more than 670 branch banking offices and over 1,200 ATMs. AmSouth operates in Tennessee Tennessee, state, United States Tennessee (tĕn`əsē', tĕn'əsē`), state in the south-central United States. , Alabama Alabama, indigenous people of North America Alabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). , Florida Florida, state, United States Florida (flôr`ĭdə, flŏr`–), state in the extreme SE United States. A long, low peninsula between the Atlantic Ocean (E) and the Gulf of Mexico (W), Florida is bordered by Georgia and , Mississippi Mississippi, state, United States Mississippi (mĭs'əsĭp`ē), one of the Deep South states of the United States. It is bordered by Alabama (E), the Gulf of Mexico (S), Arkansas and Louisiana, with most of the border formed by , Louisiana Louisiana (ləwē'zēăn`ə, l  ē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. and Georgia Georgia, country, AsiaGeorgia (jôr`jə), Georgian Sakartvelo, Rus. Gruziya, officially Republic of Georgia, republic (2005 est. pop. 4,677,000), c.26,900 sq mi (69,700 sq km), in W Transcaucasia. . AmSouth is a leader among regional banks in the Southeast Southeast or south east is the ordinal direction halfway between south and east. It the opposite of northwest. Southeast or South East can refer to:
annuity Payment made at a fixed interval. A common example is the payment received by retirees from their pension plan. There are two main classes of annuities: annuities certain and contingent annuities. and mutual fund sales, and trust and investment management services. AmSouth also offers a complete line of banking products and services at its web site, www.amsouth.com. Forward Looking Statements Statements made in this document which are not purely historical are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. as defined in the "Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995," including any statements regarding descriptions of management's plans, objectives or goals for future operations, products or services, and forecasts of its revenues, earnings or other measures of performance. Forward-looking statements are based on current management expectations and, by their nature, are subject to risks and uncertainties. A number of factors - many of which are beyond AmSouth's control - could cause actual conditions, events or results to differ materially from those described in the forward-looking statements. AmSouth's most recent annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December December: see month. 31, 2003, and quarterly report on Form 10-Q Form 10-Q See 10-Q. for the quarter ended March 31, 2004, describe factors which could cause results to differ materially from management's current expectations. Such factors include, but are not limited to: the execution of AmSouth's strategic initiatives; legislation and regulation; general economic conditions, especially in the Southeast; the performance of the stock and bond markets; changes in interest rates, yield curves and interest rate spread relationships; prepayment speeds Prepayment speed Also called speed, the estimated rate at which mortgagors pay off their loans ahead of schedule, critical in assessing the value of mortgage pass-through securities. within the loan and investment security portfolios; deposit flows; the cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. ; cost of federal deposit insurance premiums; demand for loan products; demand for financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. ; competition; changes in the quality or composition of AmSouth's loan and investment portfolios including capital market inefficiencies that may affect the marketability Marketability A negotiable security is said to have good marketability if there is an active secondary market in which it can easily be resold. marketability The ease with which an investment may be bought and sold in the secondary market. and valuation of available-for-sale securities; changes in consumer spending Consumer demand or consumption is also known as personal consumption expenditure. It is the largest part of aggregate demand or effective demand at the macroeconomic level. and saving habits; technological changes; the growth and profitability of AmSouth's mortgage banking business, including mortgage-related income and fees, being less than expected; adverse changes in the financial performance and / or condition of AmSouth's borrowers which could impact the repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of such borrowers' outstanding loans; changes in accounting and tax principles, policies or guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. and in tax laws; other economic, competitive, governmental, and regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. factors affecting AmSouth's operations, products, services and prices; unexpected judicial actions and developments; results of investigations, examinations, and reviews of regulatory and law enforcement authorities; the outcome of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , which is inherently uncertain and depends on the findings of judges and juries; the impact on AmSouth's businesses, as well as on the risks set forth above, of various domestic or international military or terrorist activities or conflicts; and AmSouth's success at managing the risks involved in the foregoing. Forward-looking statements speak only as of the date they are made. AmSouth does not undertake a duty to update forward-looking statements to reflect circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or or events that occur after the date the forward-looking statements are made.
Unaudited
AmSouth Bancorporation
SUMMARY FINANCIAL INFORMATION
($ in thousands, except per share data)
EARNINGS SUMMARY Three Months Ended
-----------------------------
2004
June 30 March 31 December 31
-------- -------- ----------
Net interest income $361,410 $359,497 $358,784
Provision for loan losses 26,600 28,100 44,500
-------- -------- ----------
Net interest income after provision 334,810 331,397 314,284
Noninterest revenues 218,252 220,430 223,390
Noninterest expenses 311,770 322,274 310,793
-------- -------- ----------
Income before income taxes 241,292 229,553 226,881
Income taxes 74,329 69,454 68,329
-------- -------- ----------
Net income $166,963 $160,099 $158,552
======== ======== ==========
Earnings per common share $0.47 $0.46 $0.45
Earnings per common share - diluted 0.47 0.45 0.45
Average common shares outstanding 351,602 351,196 350,067
Average common shares outstanding -
diluted 356,314 356,908 355,306
End of period common shares outstanding 353,414 352,904 351,891
EARNINGS SUMMARY
Percent
Change
Versus
2003 Prior
September 30 June 30 Year
--------- --------- ------
Net interest income $343,453 $349,356 3.5%
Provision for loan losses 41,800 42,700 (37.7%)
--------- ---------
Net interest income after provision 301,653 306,656 9.2%
Noninterest revenues 228,785 210,718 3.6%
Noninterest expenses 306,556 298,622 4.4%
--------- ---------
Income before income taxes 223,882 218,752 10.3%
Income taxes 66,494 63,927 16.3%
--------- ---------
Net income $157,388 $154,825 7.8%
========= =========
Earnings per common share $0.45 $0.44 6.8%
Earnings per common share - diluted 0.45 0.44 6.8%
Average common shares outstanding 349,421 349,509
Average common shares outstanding -
diluted 353,317 353,354
End of period common shares outstanding 350,622 350,477
Percent
EARNINGS SUMMARY YTD Change
------------------- Versus
2004 2003 Prior
June 30 June 30 Year
--------- --------- -------
Net interest income $720,907 $712,398 1.2%
Provision for loan losses 54,700 87,400 (37.4%)
--------- ---------
Net interest income after provision 666,207 624,998 6.6%
Noninterest revenues 438,682 403,603 8.7%
Noninterest expenses 634,044 588,228 7.8%
--------- ---------
Income before income taxes 470,845 440,373 6.9%
Income taxes 143,783 130,192 10.4%
--------- ---------
Net income $327,062 $310,181 5.4%
========= =========
Earnings per common share $0.93 $0.88 5.7%
Earnings per common share - diluted 0.92 0.88 4.5%
Average common shares outstanding 351,399 350,738
Average common shares outstanding - diluted 356,611 354,304
End of period common shares outstanding 353,414 350,477
KEY PERFORMANCE RATIOS Three Months Ended
-----------------------------
2004
June 30 March 31 December 31
-------- -------- ----------
Average shareholders' equity to average
total assets 6.92% 7.09% 7.05%
End of period shareholders' equity to end
of period total assets 6.82 7.11 7.08
Loans net of unearned income to total
deposits 97.55 94.77 96.38
Return on average assets (annualized) 1.41 1.40 1.41
Return on average shareholders' equity
(annualized) 20.31 19.76 19.96
Book value per common share $9.32 $9.56 $9.18
Tangible book value per common share $8.46 $8.71 $8.32
Net interest margin - taxable equivalent 3.44% 3.56% 3.61%
Efficiency ratio 52.83 54.57 52.43
KEY PERFORMANCE RATIOS
2003
September 30 June 30
----------- --------
Average shareholders' equity to average total
assets 7.14% 7.43%
End of period shareholders' equity to end of
period total assets 7.11 7.18
Loans net of unearned income to total deposits 98.85 96.99
Return on average assets (annualized) 1.44 1.48
Return on average shareholders' equity
(annualized) 20.18 19.95
Book value per common share $8.99 $8.98
Tangible book value per common share $8.13 $8.12
Net interest margin - taxable equivalent 3.60% 3.84%
Efficiency ratio 52.58 52.26
KEY PERFORMANCE RATIOS YTD
------------------
2004 2003
June 30 June 30
-------- ---------
Average shareholders' equity to average
total assets 7.01% 7.51%
End of period shareholders' equity to end
of period total assets 6.82 7.18
Loans net of unearned income to total deposits 97.55 96.99
Return on average assets (annualized) 1.40 1.51
Return on average shareholders' equity
(annualized) 20.04 20.10
Book value per common share $9.32 $8.98
Tangible book value per common share $8.46 $8.12
Net interest margin - taxable equivalent 3.50% 3.97%
Efficiency ratio 53.70 51.64
Unaudited
AmSouth Bancorporation
SUMMARY FINANCIAL INFORMATION
($ in thousands)
BALANCE SHEET INFORMATION Three Months Ended
AVERAGE BALANCES -------------------------------------
------------------------- 2004
June 30 March 31 December 31
----------- ----------- ------------
Loans net of unearned income $30,633,629 $29,705,743 $29,263,749
Total investment securities(a) 12,488,887 11,779,479 11,158,897
Interest-earning assets(a) 43,500,751 41,771,105 40,609,843
Total assets 47,742,291 45,953,093 44,697,830
Noninterest-bearing deposits 6,516,977 6,103,216 5,855,497
Interest-bearing deposits(b) 25,337,923 24,381,234 23,952,276
Total deposits(b) 31,854,900 30,484,450 29,807,773
Shareholders' equity 3,305,636 3,258,359 3,151,106
BALANCE SHEET INFORMATION
AVERAGE BALANCES Percent
------------------------- Change
Versus
2003 Prior
September 30 June 30 Year
------------ ---------- -------
Loans net of unearned income $28,667,773 $28,265,837 8.4%
Total investment securities(a) 10,008,025 9,086,673 37.4%
Interest-earning assets(a) 39,075,134 37,708,903 15.4%
Total assets 43,315,707 41,917,998 13.9%
Noninterest-bearing deposits 5,605,708 5,329,351 22.3%
Interest-bearing deposits(b) 23,598,915 22,766,452 11.3%
Total deposits(b) 29,204,623 28,095,803 13.4%
Shareholders' equity 3,094,790 3,112,945 6.2%
BALANCE SHEET INFORMATION Percent
AVERAGE BALANCES YTD Change
------------------------- ------------------------- Versus
2004 2003 Prior
June 30 June 30 Year
------------ ------------ -------
Loans net of unearned income $30,169,686 $28,049,022 7.6%
Total investment securities(a) 12,134,183 9,028,369 34.4%
Interest-earning assets(a) 42,635,928 37,333,218 14.2%
Total assets 46,847,692 41,433,111 13.1%
Noninterest-bearing deposits 6,310,096 5,237,375 20.5%
Interest-bearing deposits(b) 24,859,579 22,406,351 10.9%
Total deposits(b) 31,169,675 27,643,726 12.8%
Shareholders' equity 3,281,997 3,111,683 5.5%
(a) Excludes adjustment for market valuation on available-
for-sale securities and certain noninterest-earning
marketable equity securities.
(b) Statement 133 valuation adjustments related to time
deposits, certificates of deposit of $100,000 or more and
other interest-bearing liabilities are included in other
liabilities.
BALANCE SHEET INFORMATION
ENDING BALANCES
-------------------------
Loans net of unearned income $31,351,497 $29,893,723 $29,339,364
Total investment securities(a) 12,716,413 12,426,033 12,036,854
Interest-earning assets(a) 44,439,782 43,253,884 41,521,449
Total assets 48,341,045 47,414,968 45,615,516
Noninterest-bearing deposits 6,636,325 6,544,028 6,273,835
Interest-bearing deposits 25,502,919 25,000,664 24,166,518
Total deposits 32,139,244 31,544,692 30,440,353
Shareholders' equity 3,295,478 3,372,349 3,229,669
Percent
Change
Versus
BALANCE SHEET INFORMATION Prior
ENDING BALANCES Year
------------------------- -------
Loans net of unearned income $29,128,404 $28,222,542 11.1%
Total investment securities(a) 11,011,789 10,522,760 20.8%
Interest-earning assets(a) 40,341,180 39,296,146 13.1%
Total assets 44,342,699 43,784,207 10.4%
Noninterest-bearing deposits 5,839,977 5,849,456 13.5%
Interest-bearing deposits 23,628,246 23,249,370 9.7%
Total deposits 29,468,223 29,098,826 10.4%
Shareholders' equity 3,152,834 3,145,575 4.8%
(a) Excludes adjustment for market valuation on available-for-sale
securities and certain noninterest-earning marketable equity
securities.
Unaudited
AmSouth Bancorporation
SUMMARY FINANCIAL INFORMATION
($ in thousands)
NONPERFORMING ASSETS 2004 2003
June March December September June
30 31 31 30 30
-------- -------- -------- -------- --------
Nonaccrual loans(c) $102,670 $102,904 $110,153 $120,793 $127,645
Foreclosed properties 29,586 29,291 32,616 35,163 40,656
Repossessions 3,295 3,733 4,986 5,890 7,058
-------- -------- -------- -------- --------
Total nonperforming
assets(c) $135,551 $135,928 $147,755 $161,846 $175,359
======== ======== ======== ======== ========
Nonperforming assets to
loans net of unearned
income, foreclosed
properties and
repossessions 0.43% 0.45% 0.50% 0.55% 0.62%
Accruing loans 90 days
past due $52,972 $58,195 $67,460 $72,588 $67,454
======== ======== ======== ======== ========
(c) Exclusive of accruing loans 90 days past due
ALLOWANCE FOR LOAN LOSSES 2004 2003
2nd 1st 4th 3rd 2nd
Quarter Quarter Quarter Quarter Quarter
----------------------- --------- -------- --------- -------- --------
Balance at beginning
of period $382,450 $384,124 $384,059 $384,011 $383,936
Loans charged off (38,202) (44,412) (56,403) (55,102) (55,565)
Recoveries of loans
previously charged off 11,634 16,406 11,968 13,350 12,940
--------- -------- --------- -------- --------
Net Charge-offs (26,568) (28,006) (44,435) (41,752) (42,625)
Addition to allowance
charged to expense 26,600 28,100 44,500 41,800 42,700
Allowance sold - (1,768) - - -
--------- -------- --------- -------- --------
Balance at end of
period $382,482 $382,450 $384,124 $384,059 $384,011
========= ======== ======== ======== ========
Allowance for loan
losses to loans net of
unearned income 1.22% 1.28% 1.31% 1.32% 1.36%
Net charge-offs to
average loans net of
unearned income (d) 0.35% 0.38% 0.60% 0.58% 0.60%
Allowance for loan
losses to nonperforming
loans(c) 372.54% 371.66% 348.72% 317.95% 300.84%
Allowance for loan
losses to nonperforming
assets(c) 282.17% 281.36% 259.97% 237.30% 218.99%
(c) Exclusive of accruing loans 90 days past due
(d) Annualized
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