Associated Banc-Corp reports earnings of 62 cents per share; Growth of net interest income, fees validate strategy, Conlon says.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)--July 22, 1999 -- 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. (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 second quarter of 1999 of $39.9 million, or 62 cents 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. That compares to net income for the second quarter of 1998 of $41.0 million, or 64 cents per diluted share, and $39.0 million, or 61 cents per diluted share in the first quarter of 1999. Excluding gains on the sale of assets and securities, second quarter net income would have increased by approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $2.4 million (6.7 percent), or 4 cents per diluted share over the comparable quarter last year. Net income for the first half of 1999 was $78.8 million, or $1.23 per diluted share. That compares to income of $80.9 million for the first half of 1998, or $1.26 per diluted share. Excluding gains on the sale of assets and securities, net income for the first half of the year would have increased by approximately $2.6 million (3.6 percent), or 4 cents per diluted share over the comparable period last year. Return on average equity was 17.64 percent and return on average assets was 1.40 percent for the second quarter of 1999. "Overall, we are pleased that our first half results demonstrate our progress in achieving our plan," Associated Banc-Corp 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. "The first half of 1999 included the trailing costs of recent investments. As we indicated at the start of the year, we expect revenue growth to outpace out·pace tr.v. out·paced, out·pac·ing, out·pac·es To surpass or outdo (another), as in speed, growth, or performance. outpace Verb [-pacing, those costs later in 1999." Important segments continued their growth in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with Associated's strategic plan, the company said. Net interest income, which represents more than 70 percent of total revenue, increased to $97.6 million, and trust service fees increased 19.1 percent from the second quarter of 1998 to $9.6 million. While core business line growth was encouraging, year-over-year earnings per share comparisons are affected by unusual revenue gains in the second quarter of 1998 resulting from planned asset sales related to the integration of First Financial Bank, the company said. Also in the second quarter of this year, Associated announced its intent to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. up to 2.8 million shares of its stock in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with its purchase of Riverside Riverside. 1 City (1990 pop. 226,505), seat of Riverside co., S Calif.; inc. 1883. One of the fastest growing U.S. cities in the late 20th cent., it is famous for its orange industry. Bank of 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. . Associated Banc-Corp is headquartered in Green Bay, Wis. Through its more than 200 banking offices and 225 ATMs, Associated serves 150 communities 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 , 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. and Minnesota Minnesota, state, United States Minnesota (mĭn'ĭsō`tə), upper midwestern state of the United States. It is bordered by Lake Superior and Wisconsin (E), Iowa (S), South Dakota and North Dakota (W), and the Canadian provinces . More information on Associated Banc-Corp is available at www.associatedbank.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 uncertain ties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are interest rates, changes in the mix of the company's business, competitive pressures, general economic conditions, the successful integration of acquired businesses, the nature, extent and timing of governmental actions and reforms, the risk of year 2000-related computer disruptions and risk factors detailed in the company's period reports and registration statements filed with the Securities and Exchange Commission.
Consolidated Statements of Income (Unaudited)
Associated Banc-Corp
(in thousands, except per share amounts)
For The Three Months Ended, For The Six Months Ended
June 30, June 30,
--------------------------- --------------------------
1999 1998 1999 1998
----------------------------------------------------------------
Interest Income
Interest and
fees on loans $ 151,576 $ 151,406 $ 301,972 $ 302,463
Interest and
dividends on
investment
securities:
Taxable 40,181 41,588 80,358 85,884
Tax-exempt 5,270 2,579 9,998 5,018
Interest on
deposits in
other financial
institutions 119 608 280 1,185
Interest on
federal funds
sold and securities
purchased under
agreements to
resell 231 232 469 487
--------- --------- --------- ---------
Total interest
income 197,377 196,413 393,077 395,037
Interest Expense
Interest on
deposits 75,543 86,774 152,942 173,071
Interest on
short-term
borrowings 23,858 15,280 44,919 32,650
Interest on
long-term
borrowings 425 544 867 985
--------- --------- --------- ---------
Total interest
expense 99,826 102,598 198,728 206,706
--------- --------- --------- ---------
Net Interest
Income 97,551 93,815 194,349 188,331
Provision for
possible loan
losses 4,547 3,375 8,998 7,133
--------- --------- --------- ---------
Net interest
income after
provision for
possible
loan losses 93,004 90,440 185,351 181,198
Noninterest Income
Trust service
fees 9,608 8,066 19,189 15,981
Service charges
on deposit
accounts 6,773 6,816 13,690 13,186
Mortgage banking 8,420 11,183 20,221 22,079
Credit card and
other nondeposit
fees 5,094 4,711 9,652 8,697
Retail
commissions 4,897 3,987 8,783 7,377
Asset sale gains,
net 321 6,191 603 6,376
Investment
securities gains,
net 1,023 643 4,612 5,954
Other 5,129 3,340 9,131 6,863
--------- --------- --------- ---------
Total noninterest
income 41,265 44,937 85,881 86,513
Noninterest Expense
Salaries and
employee
benefits 39,153 37,322 77,383 73,585
Occupancy 5,581 5,054 11,507 10,222
Equipment 3,725 3,458 7,417 6,867
Data processing 5,167 4,789 10,462 9,443
Business development
and advertising 3,270 4,069 6,329 7,335
Stationery and
supplies 2,021 1,486 3,892 2,882
FDIC expense 716 817 1,578 1,647
Professional fees 1,991 1,431 5,554 3,745
Other 15,274 14,432 31,769 28,707
--------- --------- --------- ---------
Total noninterest
expense 76,898 72,858 155,891 144,433
--------- --------- --------- ---------
Income before
income taxes 57,371 62,519 115,341 123,278
Income tax
expense 17,495 21,515 36,514 42,414
--------- --------- --------- ---------
Net Income $ 39,876 $ 41,004 $ 78,827 $ 80,864
========= ========= ========= =========
Earnings Per Share:
Basic $ 0.63 $ 0.65 $ 1.25 $ 1.28
Diluted $ 0.62 $ 0.64 $ 1.23 $ 1.26
Average Shares
Outstanding:
Basic 63,337 63,261 63,276 63,271
Diluted 63,922 64,029 63,844 64,061
======================================================================
Consolidated Balance Sheets (Unaudited)
Associated Banc-Corp
June 30, December 31, June 30,
(in thousands) 1999 1998 1998
----------------------------------------------------------------------
Assets
Cash and due from banks $ 248,019 $ 331,532 $ 274,318
Interest-bearing deposits in
other financial institutions 5,333 200,467 5,828
Federal funds sold and
securities purchased under
agreements to resell 35,500 4,485 18,500
Securities held to maturity,
at amortized cost 479,142 550,775 674,691
Securities available for sale,
at fair value 2,611,650 2,356,960 2,044,507
Loans held for sale 83,800 165,170 86,851
Loans 7,634,576 7,272,697 7,210,496
Allowance for possible
loan losses (103,735) (99,677) (91,708)
---------- ---------- -----------
Loans, net 7,530,841 7,173,020 7,118,788
Premises and equipment 137,513 140,142 128,573
Other assets 490,986 328,116 209,287
---------- ---------- -----------
Total assets $ 11,622,784 $ 11,250,667 $ 10,561,343
============ ============ ============
Liabilities and
Stockholders' Equity
Noninterest-bearing deposits $ 973,854 $ 998,379 $ 841,997
Interest-bearing deposits 7,515,832 7,559,440 7,625,071
---------- ---------- -----------
Total deposits 8,489,686 8,557,819 8,467,068
Short-term borrowings 2,105,821 1,671,093 1,066,288
Long-term borrowings 25,661 26,004 27,758
Accrued expenses and
other liabilities 104,410 117,030 132,943
---------- ---------- -----------
Total liabilities 10,725,578 10,371,946 9,694,057
Stockholders' Equity
Preferred stock - - -
Common stock 634 634 634
Surplus 225,757 225,757 224,982
Retained earnings 684,020 646,071 613,314
Accumulated other
comprehensive income (9,609) 23,369 31,810
Treasury stock at cost (3,596) (17,110) (3,454)
---------- ---------- -----------
Total stockholders' equity 897,206 878,721 867,286
---------- ---------- -----------
Total liabilities and
stockholders' equity $ 11,622,784 $ 11,250,667 $ 10,561,343
============ ============ ============
======================================================================
Selected Quarterly Information
Associated Banc-Corp
----------------------------------------------------------------------
($ in thousands, except per share data) 2nd Qtr 1999 1st Qtr 1999
----------------------------------------------------------------------
Summary of Operations
Interest income $ 197,377 $ 195,700
Interest expense 99,826 98,902
Net interest income 97,551 96,798
Provision for loan losses 4,547 4,451
Net interest income after
provision for loan losses 93,004 92,347
Investment securities gains 1,023 3,589
Noninterest income
(excluding securities gains) 40,242 41,027
Noninterest expense 76,898 78,993
Income taxes 17,495 19,019
Net income 39,876 38,951
Taxable equivalent adjustment 3,125 2,780
----------------------------------------------------------------------
At Period End
Assets $ 11,622,784 $ 11,301,816
Earning assets 10,850,001 10,659,971
Loans 7,634,576 7,463,921
Allowance for possible loan
losses 103,735 103,064
Deposits 8,489,686 8,437,635
Stockholders' equity 897,206 903,532
Stockholders' equity / assets 7.72% 7.99%
Goodwill and core deposit
intangibles 54,337 56,112
----------------------------------------------------------------------
Average Balances
Assets $ 11,443,433 $ 11,154,012
Earning assets 10,708,793 10,478,239
Interest-bearing liabilities 9,462,136 9,216,896
Loans 7,641,973 7,500,009
Deposits 8,430,295 8,373,924
Stockholders' equity 906,503 906,023
Stockholders' equity / assets 7.92% 8.12%
----------------------------------------------------------------------
Credit Quality
Nonaccrual loans $ 37,431 $ 39,749
Loans 90 or more days past
due and still accruing(1) 4,243 5,358
Restructured loans 283 776
---------------------------------------
Total nonperforming loans 41,957 45,883
Other real estate owned (ORE) 9,759 10,568
---------------------------------------
=======================================
Total nonperforming assets 51,716 56,451
=======================================
Net charge-offs 3,876 3,101
Allowance for loan losses/
loans 1.36% 1.38%
Allowance for loan losses/
nonperforming assets 200.59 182.57
Allowance for loan losses/
nonperforming loans 247.24 224.62
Nonperforming assets/
loans plus ORE 0.68 0.76
Nonperforming assets/
total assets 0.44 0.50
Net charge-offs/average loans
(annualized) 0.20 0.17
----------------------------------------------------------------------
Per Common Share Data
Net income:
Basic $ 0.63 $ 0.62
Diluted 0.62 0.61
Cash 0.65 0.63
Dividends 0.2900 0.2900
Market Value:
High $ 43.06 $ 35.25
Low 30.81 30.31
Close 41.50 31.94
Book value 14.18 14.27
Shares outstanding, end of per 63,285 63,331
----------------------------------------------------------------------
Performance Ratios (annualized)
Net interest margin (FTE) 3.74% 3.78%
Return on average assets 1.40 1.42
Return on average equity 17.64 17.44
Efficiency ratio 54.57 56.18
Expense ratio 1.37 1.47
Effective tax rate 30.49 32.81
Dividend payout ratio (basic) 46.06 47.06
----------------------------------------------------------------------
4th Qtr 1998 3rd Qtr 1998 2nd Qtr 1998
----------------------------------------------------------------------
Summary of Operations
Interest income $ 194,323 $ 196,405 $ 196,413
Interest expense 101,599 102,723 102,598
Net interest income 92,724 93,682 93,815
Provision for loan losses 4,229 3,378 3,375
Net interest income after
provision for loan losses 88,495 90,304 90,440
Investment securities gains 842 35 643
Noninterest income
(excluding securities gains) 41,575 38,986 44,294
Noninterest expense 78,501 72,051 72,858
Income taxes 14,655 18,874 21,515
Net income 37,756 38,400 41,004
Taxable equivalent adjustment 2,003 1,644 1,545
----------------------------------------------------------------------
At Period End
Assets $ 11,250,667 $ 10,575,675 $ 10,561,343
Earning assets 10,550,554 10,090,395 10,040,873
Loans 7,272,697 7,180,810 7,210,496
Allowance for possible loan
losses 99,677 92,715 91,708
Deposits 8,557,819 8,499,668 8,467,068
Stockholders' equity 878,721 883,564 867,286
Stockholders' equity / assets 7.81% 8.35% 8.21%
Goodwill and core deposit
intangibles 40,441 30,002 31,462
----------------------------------------------------------------------
Average Balances
Assets $ 10,823,063 $ 10,562,160 $ 10,534,920
Earning assets 10,123,573 10,036,620 10,041,925
Interest-bearing liabilities 8,851,990 8,713,267 8,748,600
Loans 7,239,041 7,294,042 7,285,812
Deposits 8,503,982 8,484,093 8,401,630
Stockholders' equity 877,201 869,972 849,663
Stockholders' equity / assets 8.10% 8.24% 8.07%
----------------------------------------------------------------------
Credit Quality
Nonaccrual loans $ 48,150 $ 36,566 $ 39,512
Loans 90 or more days past
due and still accruing 5,252 6,161 6,404
Restructured loans 485 287 287
---------------------------------------
Total nonperforming loans 53,887 43,014 46,203
Other real estate owned (ORE) 6,025 4,085 4,012
---------------------------------------
=======================================
Total nonperforming assets 59,912 47,099 50,215
=======================================
Net charge-offs 903 2,370 5,083
Allowance for loan losses/
loans 1.37% 1.29% 1.27%
Allowance for loan losses/
nonperforming assets 166.37 196.85 182.63
Allowance for loan losses/
nonperforming loans 184.97 215.55 198.49
Nonperforming assets/
loans plus ORE 0.82 0.66 0.70
Nonperforming assets/
total assets 0.53 0.45 0.48
Net charge-offs/average loans
(annualized) 0.05 0.13 0.28
----------------------------------------------------------------------
Per Common Share Data
Net income:
Basic $ 0.60 $ 0.61 $ 0.65
Diluted 0.60 0.60 0.64
Cash 0.62 0.62 0.66
Dividends 0.2900 0.2900 0.2320
Market Value:
High $ 37.00 $ 42.38 $ 43.70
Low 26.75 31.44 36.25
Close 34.19 31.44 37.63
Book value 13.97 13.96 13.70
Shares outstanding, end of per 62,887 63,295 63,309
----------------------------------------------------------------------
Performance Ratios (annualized
Net interest margin (FTE) 3.72% 3.78% 3.78%
Return on average assets 1.38 1.44 1.56
Return on average equity 17.08 17.51 19.36
Efficiency ratio 57.59 53.65 52.17
Expense ratio 1.45 1.31 1.14
Effective tax rate 27.96 32.95 34.41
Dividend payout ratio (basic) 48.13 47.81 35.69
----------------------------------------------------------------------
Per share data adjusted retroactively for stock splits and stock
dividends.
Cash diluted EPS excludes the after-tax effect of the
amortization of goodwill related intangibles in net income.
(1) - Does not include guaranteed student loans. Guaranteed
student loans 90+ days past due and still accruing totaled $11.5
million as of June 30, 1999.
======================================================================
Financial Summary and Comparison
Associated Banc-Corp
Three months ended
June 30,
------------------------------------------
($ in thousands,
except per share data) 1999 1998 % Change
------------------------- ------------------------------------------
Summary of Operations
Interest income $ 197,377 $ 196,413 0.5
Interest expense 99,826 102,598 (2.7)
Net interest income 97,551 93,815 4.0
Provision for loan losses 4,547 3,375 34.7
Net interest income after
provision for loan losses 93,004 90,440 2.8
Investment securities gains 1,023 643 59.1
Noninterest income 40,242 44,294 (9.1)
Noninterest expense 76,898 72,858 5.5
Income taxes 17,495 21,515 (18.7)
Net income 39,876 41,004 (2.8)
Taxable equivalent adjustment 3,125 1,545 102.3
----------------------------------------------------------------------
At Period End
Assets
Earning assets
Loans
Allowance for possible loan losses
Deposits
Stockholders' equity
----------------------------------------------------------------------
Average Balances
Assets $ 11,443,433 $ 10,534,920 8.6
Earning assets 10,708,793 10,041,925 6.6
Interest-bearing
liabilities 9,462,136 8,748,600 8.2
Loans 7,641,973 7,285,812 4.9
Deposits 8,430,295 8,401,630 0.3
Stockholders' equity 906,503 849,663 6.7
Stockholders' equity / assets 7.92% 8.07%
----------------------------------------------------------------------
Per Common Share Data
Net income:
Basic $ 0.63 $ 0.65 (3.1)
Diluted 0.62 0.64 (3.1)
Cash 0.65 0.66 (1.6)
Dividends 0.2900 0.2320 25.0
Market Value:
High $ 43.06 $ 43.70 (1.5)
Low 30.81 36.25 (15.0)
Close 41.50 37.63 10.3
Book value 14.18 13.70 3.5
Shares outstanding,
end of period (000) 63,285 63,309 (0.0)
----------------------------------------------------------------------
Performance Ratios (annualized)
Net interest margin (FTE) 3.74% 3.78%
Return on average assets 1.40 1.56
Return on average equity 17.64 19.36
Efficiency ratio 54.57 52.17
Expense ratio 1.37 1.14
Effective tax rate 30.49 34.41
Dividend payout ratio 46.06 35.69
----------------------------------------------------------------------
Per share data adjusted retroactively for stock splits and stock
dividends.
Cash diluted EPS excludes the after-tax effect of the amortization of
goodwill related intangibles in net income.
----------------------------------------------------------------------
Financial Summary and Comparison
Associated Banc-Corp
Six months ended
June 30,
------------------------------------------
($ in thousands,
except per share data) 1999 1998 % Change
------------------------- ------------------------------------------
Summary of Operations
Interest income $ 393,077 $ 395,037 (0.5)
Interest expense 198,728 206,706 (3.9)
Net interest income 194,349 188,331 3.2
Provision for loan losses 8,998 7,133 26.1
Net interest income after
provision for loan losses 185,351 181,198 2.3
Investment securities gains 4,612 5,954 (22.5)
Noninterest income 81,269 80,559 0.9
Noninterest expense 155,891 144,433 7.9
Income taxes 36,514 42,414 (13.9)
Net income 78,827 80,864 (2.5)
Taxable equivalent adjustment 5,905 3,055 93.3
----------------------------------------------------------------------
At Period End
Assets $ 11,622,784 $ 10,561,343 10.1
Earning assets 10,850,001 10,040,873 8.1
Loans 7,634,576 7,210,496 5.9
Allowance for
possible loan losses 103,735 91,708 13.1
Deposits 8,489,686 8,467,068 0.3
Stockholders' equity 897,206 867,286 3.4
----------------------------------------------------------------------
Average Balances
Assets $ 11,300,623 $ 10,558,533 7.0
Earning assets 10,596,698 10,058,454 5.4
Interest-bearing liabilities 9,342,912 8,791,806 6.3
Loans 7,573,929 7,244,104 4.6
Deposits 8,402,265 8,365,531 0.4
Stockholders' equity 906,264 839,158 8.0
Stockholders' equity / assets 8.02% 7.95%
----------------------------------------------------------------------
Per Common Share Data
Net income:
Basic $ 1.25 $ 1.28 (2.3)
Diluted $ 1.23 $ 1.26 (2.4)
Cash $ 1.28 $ 1.30 (1.5)
Dividends 0.5800 0.4640 25.0
Market Value:
High $ 43.06 $ 43.80 (1.7)
Low 30.31 36.25 (16.4)
Close 41.50 37.63 10.3
Book value 14.18 13.70 3.5
Shares outstanding,
end of period (000) 63,285 63,309 (0.0)
----------------------------------------------------------------------
Performance Ratios (annualized)
Net interest margin (FTE) 3.76% 3.78%
Return on average assets 1.41 1.54
Return on average equity 17.54 19.43
Efficiency ratio 55.37 53.11
Expense ratio 1.42 1.28
Effective tax rate 31.66 34.41
Dividend payout ratio 46.40 36.25
----------------------------------------------------------------------
Per share data adjusted retroactively for stock splits and stock
dividends.
Cash diluted EPS excludes the after-tax effect of the amortization of
goodwill related intangibles in net income.
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