Associated Banc-Corp Net Income Up 12.3% for First Nine Months.GREEN BAY, Wis adv. 1. Certainly; really; indeed. v. t. 1. To think; to suppose; to imagine; - used chiefly in the first person sing. present tense, I wis. See the Note under Ywis. .--(BUSINESS WIRE)--Oct. 22, 1998--Associated Banc-Corp (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ASBC ASBC American Society of Brewing Chemists (St. Paul, MN) ASBC American Small Business Coalition ASBC Air and Space Basic Course (USAF) ASBC Archaeological Society of British Columbia ) today reported net income for the first nine months of 1998 of $119.3 million, up 12.3 percent from the same period in 1997. Earnings were $1.88 per basic share, up 11.2 percent from earnings of $1.69 per basic share in the first nine months of 1997. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $1.86 for the first nine months, up 12.0 percent from diluted earnings per share of $1.66 for the year-earlier period. Net income for the third quarter was $38.4 million, up 4.3 percent from the same period in 1997, resulting in third quarter 1998 earnings of $.61 per basic share or $.60 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, up from $.59 cents per basic share and $.58 cents per diluted share in the year-earlier quarter. Associated Banc-Corp Associated Banc-Corp is a bank holding company headquartered in Green Bay, Wisconsin. As of early 2007, it had $20.8 billion in assets and was the 41st largest bank holding company in the United States.[1] The company has over 5101 employees. Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. H.B. Conlon Conlon is an Irish family name, the gaelic spelling being Ó Connalláin. It is a variartion of the anglcised version of Ó Connalláin. It is sometimes spelt Conlan, Conlen and Conlin. Like most surnames, it is sometimes used as a first name. said he was satisfied with the results in light of the extraordinary demands on the company during the period. "In the first nine months of this year we faced a challenging interest rate environment, as well as increased costs in converting to new technology and in the integration of the $6 billion-asset First Financial Corp. Nevertheless, we kept pace with our stated financial goals, thanks in part to growth of our fee income of 22 percent over the first nine months of 1997, and gains on the sale of assets as part of the integration," Conlon said. He added, "To the extent that we experience the current interest rate environment in the coming year, along with continuing costs related to integration and technology, including Y2K See Y2K problem and Y2K compliant. Y2K - Year 2000 expenses, we face a significant challenge in 1999 in keeping pace with our published five-year goal of 11 percent average annual earnings growth for the period from 1998 through 2002." Conlon also provided an update on the company's integration and acquisition activity. He said the company will complete its integration of First Financial on Nov. 12. The company had planned an integration time frame of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. one year to maximize In a graphical environment, to enlarge a window to the full size of the screen. See Win Maximize windows. customer retention. When the integration is completed, the First Financial offices in Wisconsin Wisconsin, state, United States Wisconsin (wĭskŏn`sən, –sĭn), upper midwestern state of the United States. It is bounded by Lake Superior and the Upper Peninsula of Michigan, from which it is divided by the Menominee will become branches of the six existing Associated Banks in Wisconsin. A new national bank, Associated Bank Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. , has been formed to accommodate the 53 First Financial offices in the Peoria Peoria (pēôr`ēə). 1 City (1990 pop. 50,618), Maricopa co., central Ariz., a suburb of Phoenix; settled 1897, inc. 1954. , St. Louis Louis, titular duke of Burgundy Louis, 1682–1712, titular duke of Burgundy; grandson of King Louis XIV of France. He became heir to the throne on the death (1711) of his father, Louis the Great Dauphin. and Rockford Rockford, industrial city (1990 pop. 139,426), seat of Winnebago co., N Ill., on the Rock River near the Wis. line; inc. 1839 with the merger of two settlements on opposite sides of the river. areas, where Associated did not have operations prior to the First Financial merger. The new Illinois bank will have assets of approximately $2.6 billion. When the integration is completed, 10 banking offices with service areas that overlap o·ver·lap n. 1. A part or portion of a structure that extends or projects over another. 2. The suturing of one layer of tissue above or under another layer to provide additional strength, often used in dental surgery. v. those of other, very nearby Associated facilities will be consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: , reducing the total number of banking offices from 225 to 215. In the first half of 1999, the company expects to identify and divest To deprive or take away. Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. of additional office locations that are no longer justified in light of its current strategy, Conlon said. Additionally, Conlon noted Associated plans to complete its merger with the $160 million-asset Citizens Bancorp of Shawano Shawano: see Shawnee. , Wis. in the fourth quarter of 1998. Associated is in the process of buying back up to 900,000 shares of its own stock in the open market to reissue re·is·sue v. re·is·sued, re·is·su·ing, re·is·sues v.tr. To issue again, especially to make available again. v.intr. To come forth again. n. 1. in this transaction. Associated's merger with the $190 million-asset Windsor Windsor, British royal family Windsor (wĭn`zər), family name of the royal house of Great Britain. The name Wettin, family name of Albert of Saxe-Coburg-Gotha, consort of Queen Victoria, was changed to Windsor by George V in 1917. Bankshares, Inc. which is based in Minneapolis Minneapolis (mĭn'ēăp`əlĭs), city (1990 pop. 368,383), seat of Hennepin co., E Minn., at the head of navigation on the Mississippi River, at St. Anthony Falls; inc. 1856. , is expected to close in the first quarter of 1999, Conlon said. Conlon also said the company's 1999-2001 strategic plan calls for a focus on generating revenue from the substantially larger, restructured company. The plan also calls for eventual cost savings resulting from the successful completion of several complex consolidation and integration processes - most importantly Adv. 1. most importantly - above and beyond all other consideration; "above all, you must be independent" above all, most especially the integration of First Financial. Associated Banc-Corp, headquartered in Green Bay, Wis., is a diversified diversified (di·verˑ·s multibank holding company Noun 1. multibank holding company - a bank holding company owning several banks bank holding company - a holding company owning or controlling one or more banks with $10.6 billion in total assets. Associated has more than 200 banking offices, and 225 ATMs serving 150 communities in Wisconsin and Illinois. The company offers a full range of traditional banking services and a variety of financially related products and services through other Associated affiliates. More information on Associated Banc-Corp is available at http://www.assocbank.com. This news release contains 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. that involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are changes in the mix of the company's business, competitive pressures, general economic conditions and the risk factors detailed in the company's periodic reports and registration statements filed with the Securities and Exchange Commission. -- Financial Tables Follow --
Consolidated Statements of Income (Unaudited)
Associated Banc-Corp
For The For The
Three Nine
Months Months
Ended, Ended,
September September
(in thousands, except 30, 30,
per share amounts) 1998 1997 1998 1997
----------------------------------------------------------------------
Interest Income
Interest and fees
on loans $151,557 $151,163 $453,685 $439,573
Interest and dividends on
investment securities:
Taxable 40,794 46,915 126,678 137,657
Tax-exempt 2,791 2,212 7,809 6,812
Interest on deposits in other
financial institutions 256 120 1,441 653
Interest on federal funds sold
and securities purchased
under agreements to
resell 778 231 1,265 737
--------- --------- --------- --------
Total interest income 196,176 200,641 590,878 585,432
Interest Expense
Interest on deposits 87,639 86,226 260,711 250,083
Interest on short-term
borrowings 14,637 19,212 47,288 53,684
Interest on long-term
borrowings 447 419 1,431 1,453
--------- --------- --------- --------
Total interest expense 102,723 105,857 309,430 305,220
--------- --------- --------- --------
Net Interest Income 93,453 94,784 281,448 280,212
Provision for possible loan
losses 3,378 3,739 10,511 10,297
--------- --------- --------- --------
Net interest income after
provision for possible
loan losses 90,075 91,045 270,937 269,915
Noninterest Income
Trust service fees 8,496 7,089 24,477 21,020
Service charges on deposit
accounts 7,092 7,211 20,279 20,732
Investment securities gains,
net 35 851 5,989 2,234
Mortgage banking activity 10,568 6,745 32,647 17,299
Retail commission income 3,873 3,968 11,249 11,831
Loan fees 5,106 4,276 14,139 12,039
Asset sale gains, net 543 512 6,919 875
Other 3,537 3,510 10,399 9,891
--------- --------- --------- --------
Total noninterest income 39,250 34,162 126,098 95,921
Noninterest Expense
Salaries and
employee benefits 36,624 34,035 110,209 101,196
Net occupancy expense 5,082 5,010 15,303 15,865
Equipment rentals,
depreciation and
maintenance 3,499 3,165 10,366 9,370
Data processing expense 3,989 4,164 13,431 12,581
Stationery and supplies 1,572 1,450 4,454 4,026
Business development and
advertising 3,233 3,962 10,569 11,653
FDIC expense 827 810 2,474 2,452
Other 17,225 15,752 49,677 44,863
--------- --------- --------- --------
Total noninterest expense 72,051 68,348 216,483 202,006
--------- --------- --------- --------
Income before income taxes 57,274 56,859 180,552 163,830
Income tax expense 18,874 20,037 61,288 57,669
--------- --------- --------- --------
Net Income $ 38,400 $ 36,822 $ 119,264 $ 106,161
--------- --------- --------- --------
--------- --------- --------- --------
Earnings Per Share:
Basic $ 0.61 $ 0.59 $ 1.88 $ 1.69
Diluted $ 0.60 $ 0.58 $ 1.86 $ 1.66
Average Shares Outstanding:
Basic 63,306 62,738 63,283 62,871
Diluted 63,941 64,020 63,999 63,998
----------------------------------------------------------------------
Consolidated Statements of Financial Condition (Unaudited)
Associated Banc-Corp
September December September
30, 31, 30,
(in thousands) 1998 1997 1997
----------------------------------------------------------------------
Assets
Cash and due from banks $ 241,447 $ 290,184 $ 254,795
Interest-bearing deposits in
other financial
institutions 10,348 5,019 6,287
Federal funds sold and
securities purchased
under agreements to resell 68,695 11,511 32,637
Securities held to maturity 621,522 772,524 1,039,904
Securities available for sale 2,118,320 2,167,694 1,951,462
Loans held for sale 90,700 114,001 62,419
Loans, net of unearned income 7,180,810 7,072,550 7,086,026
Less: Allowance for possible
loan losses (92,715) (92,731) (74,454)
----------- ----------- -----------
Loans, net 7,088,095 6,979,819 7,011,572
Premises and equipment 134,612 127,824 130,884
Other assets 201,936 221,866 217,137
----------- ----------- -----------
Total assets $ 10,575,675 $10,690,442 $10,707,097
----------- ----------- -----------
----------- ----------- -----------
Liabilities and Stockholders'
Equity
Noninterest-bearing deposits $ 888,896 $ 904,638 $ 799,310
Interest-bearing deposits 7,610,772 7,459,427 7,518,180
----------- ----------- -----------
Total deposits 8,499,668 8,364,065 8,317,490
Short-term borrowings 1,040,095 1,337,008 1,380,335
Accrued expenses and other
liabilities 125,459 160,406 118,795
Long-term borrowings 26,889 15,270 16,451
----------- ----------- -----------
Total liabilities 9,692,111 9,876,749 9,833,071
Stockholders' Equity
Preferred stock - - -
Common stock 634 504 503
Surplus 224,982 218,072 215,872
Retained earnings 631,052 569,996 639,057
Equity adjustment-Securities
available for sale 30,512 26,144 18,594
Less: Treasury stock (3,616) (1,023) -
----------- ----------- -----------
Total stockholders' equity 883,564 813,693 874,026
----------- ----------- -----------
Total liabilities and
stockholders' equity $10,575,675 $10,690,442 $10,707,097
----------- ----------- -----------
----------- ----------- -----------
----------------------------------------------------------------------
Selected Quarterly Information
Associated Banc-Corp
($ in thousands, 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr 3rd Qtr
except per
share data) 1998 1998 1998 1997(1) 1997
----------------------------------------------------------------------
Summary of Operations
Interest income $196,176 $196,252 $198,450 $201,788 $200,641
Interest expense 102,723 102,599 104,108 106,418 105,857
Net interest income 93,453 93,653 94,342 95,370 94,784
Provision for loan 3,378 3,375 3,759 4,571 3,739
losses
Net interest
income after
provision for
loan losses 90,075 90,278 90,583 90,799 91,045
Investment
securities gains
(losses) 35 642 5,311 279 851
Noninterest income 39,215 44,456 36,440 35,092 33,311
Noninterest expense 72,051 72,857 71,575 70,020 68,348
Income taxes 18,874 21,515 20,899 20,133 20,037
Net income 38,400 41,004 39,860 36,017 36,822
Taxable equivalent
adjustment 1,645 1,544 1,509 1,464 1,406
----------------------------------------------------------------------
At Period End
Assets $10,575,675 $10,561,343 $10,692,268 $10,690,442 $10,707,097
Earning
assets 10,090,395 10,040,872 10,151,821 10,143,299 10,178,735
Loans 7,180,810 7,210,496 7,167,327 7,072,550 7,086,026
Allowance for
possible loan
losses 92,715 91,708 93,415 92,731 74,454
Deposits 8,499,668 8,467,068 8,493,421 8,364,065 8,317,490
Stockholders'
equity 883,564 867,286 836,826 813,693 874,026
Stockholders'
equity/assets 8.35% 8.21% 7.83% 7.61% 8.16%
Goodwill and core
deposit
intangibles 30,002 31,462 32,922 34,381 37,575
----------------------------------------------------------------------
Average Balances
Assets $10,560,971 $10,534,927 $10,582,415 $10,646,367 $10,438,489
Earning
assets 10,043,826 10,041,932 10,075,172 10,151,828 9,941,498
Interest-bearing
liabilities 8,739,163 8,748,600 8,835,493 8,818,256 8,751,596
Loans 7,277,583 7,285,819 7,201,936 7,161,089 6,990,920
Deposits 8,445,002 8,401,630 8,329,031 8,335,541 8,130,206
Stockholders'
equity 859,812 849,663 828,537 868,066 843,081
Stockholders'
equity/assets 8.14% 8.07% 7.83% 8.15% 8.08%
----------------------------------------------------------------------
Credit Quality
Nonaccrual
loans $36,566 $39,512 $30,072 $32,415 $36,202
Loans 90 or more
days past
due and still
accruing (2) 6,161 6,404 3,414 1,324 1,648
Restructured
loans 287 287 455 558 186
--------- --------- --------- --------- --------
Total non-
performing
loans 43,014 46,203 33,941 34,297 38,036
Other real estate
owned (ORE) 4,085 4,012 4,265 2,067 2,447
--------- --------- --------- --------- --------
Total non-
performing
assets 47,099 50,215 38,206 36,364 40,483
--------- --------- --------- --------- --------
--------- --------- --------- --------- --------
Net charge-offs 2,370 5,081 3,075 3,113 2,947
Allowance for
loan
losses/loans 1.29% 1.27% 1.30% 1.31% 1.05%
Allowance for loan
losses/non-
performing
assets 196.85 182.63 244.50 255.01 183.91
Allowance for loan
losses/non-
performing
loans 215.55 198.49 275.23 270.38 195.75
Nonperforming
assets/loans
plus ORE 0.66 0.70 0.53 0.51 0.57
Nonperforming
assets/total
assets 0.45 0.48 0.36 0.34 0.38
Net charge-offs/
average loans
(annualized) 0.13 0.28 0.17 0.17 0.16
----------------------------------------------------------------------
Per Common Share Data
Net income:
Basic $ 0.61 $ 0.65 $ 0.63 $ 0.57 $ 0.59
Diluted 0.60 0.64 0.62 0.57 0.58
Dividends 0.290 0.2320 0.2320 0.2320 0.2320
Market Value:
High $ 42.38 $ 43.70 $ 43.80 $ 47.00 $ 39.16
Low 31.44 36.25 38.09 36.59 31.20
Close 31.44 37.63 43.16 44.09 36.05
Book value 13.96 13.70 13.24 12.92 13.91
Shares outstanding,
end of
period(000) 63,295 63,309 63,227 62,970 62,816
----------------------------------------------------------------------
Performance Ratios (annualized)
Net interest
margin (FTE) 3.76% 3.77% 3.79% 3.80% 3.85%
Return on
average assets 1.44 1.56 1.53 1.34 1.40
Return on average
equity 17.72 19.36 19.51 16.46 17.33
Efficiency
ratio 53.64 52.17 54.10 53.08 52.78
Expense ratio 1.30 1.13 1.41 1.37 1.40
Effective
tax rate 32.95 34.41 34.40 35.86 35.24
Dividend payout
ratio (basic) 47.54 35.69 36.83 40.70 39.32
Per share data adjusted retroactively for stock splits and stock
dividends.
(1) - Results exclude the effect of one-time charges in 1997
consisting of merger, integration and conversion charges totaling
$89.8 million after taxes, or $1.40 per diluted share.
(2) - Does not include guaranteed student loans. Guaranteed student
loans 90+ days past due and still accruing totaled $8.3 million
as of September 30, 1998.
----------------------------------------------------------------------
Financial Summary and Comparison
Associated Banc-Corp Three months ended
September 30,
----------------------------------
($ in thousands, except 1998 1997 % Change
per share data)
----------------------------------------------------------------------
Summary of Operations
Interest income $ 196,176 $ 200,641 (2.2)
Interest expense 102,723 105,857 (3.0)
Net interest income 93,453 94,784 (1.4)
Provision for
loan losses 3,378 3,739 (9.7)
Net interest income
after provision for
loan losses 90,075 91,045 (1.1)
Investment securities
gains (losses) 35 851 (95.9)
Noninterest income 39,215 33,311 17.7
Noninterest expense 72,051 68,348 5.4
Income taxes 18,874 20,037 (5.8)
Net income 38,400 36,822 4.3
----------------------------------------------------------------------
At Period End
Assets $10,575,675 $10,707,097 (1.2)
Earning assets 10,090,395 10,178,735 (0.9)
Loans 7,180,810 7,086,026 1.3
Allowance for possible
loan losses 92,715 74,454 24.5
Deposits 8,499,668 8,317,490 2.2
Stockholders' equity 883,564 874,026 1.1
----------------------------------------------------------------------
Average Balances
Assets $10,560,971 $10,438,489 1.2
Earning assets 10,043,826 9,941,498 1.0
Interest-bearing
liabilities 8,739,163 8,751,596 (0.1)
Loans 7,277,583 6,990,920 4.1
Deposits 8,445,002 8,130,206 3.9
Stockholders' equity 859,812 843,081 2.0
Stockholders'
equity/assets 8.14% 8.08%
----------------------------------------------------------------------
Per Common Share Data
Net income:
Basic $ 0.61 $ 0.59 3.4
Diluted 0.60 0.58 3.4
Dividends 0.2900 0.2320 25.0
Market Value:
High $ 42.38 $ 39.16 8.2
Low 31.44 31.20 0.8
Close 31.44 36.05 (12.8)
Book value 13.96 13.91 0.4
Shares outstanding,
end of period (000) 63,295 62,816 0.8
----------------------------------------------------------------------
Performance Ratios (annualized)
Net interest
margin (FTE) 3.76% 3.85%
Return on average
assets 1.44 1.40
Return on average
equity 17.72 17.33
Efficiency ratio 53.64 52.78
Expense ratio 1.30 1.40
Effective tax rate 32.95 35.24
Dividend payout ratio 47.54 39.32
----------------------------------------------------------------------
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