Banner Corporation's Second Quarter Net Income Increases 10% to $5 Million; Loans Increase 21%, Deposits Increase 19%.WALLA WALLA Walla Walla (wŏl`ə wŏl`ə), city (1990 pop. 26,478), seat of Walla Walla co., SE Wash., at the junction of the Walla Walla River and Mill Creek, near the Oregon line; inc. 1862. , Wash. -- Banner Same as banner ad. 1. banner - The title page added to printouts by most print spoolers. Typically includes user or account ID information in very large character-graphics capitals. Corporation (Nasdaq:BANR BANR Board on Agriculture and Natural Resources ), the parent company of Banner Bank Banner Bank is a Washington financial institution based in Walla Walla. Originally known as First Federal Savings And Loan Of Walla Walla, it was the oldest Savings and Loan institution in the state of Washington. , today reported that net income grew 10% in the second quarter of 2005, compared to the second quarter of 2004. Revenues increased 14% from a year ago, and loan and deposit growth remained strong. Net income was $5.0 million, or $0.42 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, in the second quarter ended June June: see month. 30, 2005, compared to $4.5 million, or $0.39 per diluted share, in second quarter of 2004. For the first six months of 2005, Banner's net income increased 9% to $9.7 million, compared to $8.9 million in the first half of 2004. "Our strategy over the past eighteen months has been to grow loans and deposits through franchise expansion," said D. Michael Jones Mike or Michael Jones may refer to: In sports:
A deposit account intended for funds that are expected to stay in for the short term. A savings account offers lower returns than the market rates. Notes: comprise To embrace, cover, or include; to confine within; to consist of. In the law governing patents—grants of an exclusive right or privilege to make, use, or sell an invention or product for a term of years—the term comprise the bulk of this new deposit growth over the past year as balances for these types of accounts have increased 31%. In the second quarter alone we produced $153 million in loan growth and $180 million in deposit growth. Much of this deposit growth can be attributed to our new locations and we are moving forward with our franchise expansion. The first of five previously announced locations in southern Idaho Southern Idaho is a generic geographical term roughly analogous with the areas of the U.S. state of Idaho located in the Mountain Time Zone. It particularly refers to the combined areas of the Boise metropolitan area, the Magic Valley and Eastern Idaho. will be opening in August. In addition, construction of an office in Vancouver, Washington
Vancouver, Washington is a city on the north bank of the Columbia River, in the state of Washington, USA. It is the county seat of Clark County. is near completion and we will be opening there in late July July: see month. . Further, we also expect to open a branch in Beaverton, Oregon Beaverton is a city in Washington County, Oregon, United States, seven miles west of Portland in the Tualatin River Valley. As of May 2006, its population is estimated to be 84,270,[1] 9.1% more than the 2000 census figure of 76,129. , in August." Second Quarter 2005 Highlights (Compared to Second Quarter 2004) --Assets grew 14% to $3.14 billion. --Loans increased 21% to $2.28 billion. --Non-interest bearing deposits increased 44% and total deposits increased 19% to $2.17 billion. --Non-performing assets declined by 40% (and 9% since 3/31/05). --Revenues advanced 14% to $31.3 million. --Net income increased 10%. --Net interest income before provision for loan losses grew 14% and other income increased 12%. Income Statement Review For the second quarter, net interest income before the provision for loan losses increased 14% to $26.7 million, compared to $23.4 million in the same quarter a year ago. For the six-month period ended June 30, 2005, net interest income before the provision for loan losses increased 13% to $51.9 million, compared to $46.1 million in the same period a year ago. Revenues (net interest income before the provision for loan losses plus other operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. ) grew 14% to $31.3 million in the second quarter, from $27.5 million last year. Revenues increased 12% to $60.6 million in the first half of 2005, compared to $54.1 million in the six-month period a year ago. "Our net interest income and deposit fee revenue reflect the strong loan and deposit growth we have generated over the past year," said Jones, "and our mortgage banking operations improved significantly as well. As we invest in expanding our franchise, we are significantly increasing our revenue generating capacity." Total other operating income for the second quarter increased 12% to $4.6 million, compared to $4.1 million for the same quarter last year. For the first six months of 2005, total other operating income increased 9% to $8.6 million, compared to $7.9 million in the first six months of 2004. Income from deposit fees and other service charges increased 17% to $2.4 million in the second quarter, compared to $2.1 million for the same period in 2004. Mortgage banking operations increased 13% to $1.6 million in the second quarter, compared to $1.5 million for the second quarter a year ago. Other operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased to $22.8 million in the quarter, compared to $19.5 million in the second quarter last year, largely due to the additional costs associated with operating the new branches. For the first six months of 2005, other operating expenses were $44.1 million, an increase from $38.4 million in the first six months of 2004. The ratio of other operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. (expense ratio) to average assets was 3.02% for the second quarter, compared to 2.95% for the first quarter of 2005 and 2.88% for the second quarter of 2004. "So far during 2005 we have opened new branches in Kent, Everett Everett. 1 City (1990 pop. 35,701), Middlesex co., E Mass., an industrial suburb of Boston, on the Mystic River; settled c.1643, set off from Malden 1870, inc. as a city 1892. , Edmonds Edmonds, city (1990 pop. 30,744), Snohomish co., NW Wash., a residential suburb of Seattle, on Puget Sound; inc. 1890. There is boatbuilding and the manufacture of lighting equipment, machinery, and laboratory apparatus. , Lynnwood Lynnwood, city (1990 pop. 28,695), Snohomish co., W central Wash., a residential and industrial suburb of Seattle; inc. 1959. Aerospace parts, communications and electrical equipment, electronic components, precious metal jewelry, and scales and balances are among , Mercer Island Mer·cer Island A city of west-central Washington, coextensive with Mercer Island in Lake Washington near Seattle. It is primarily residential. Population: 22,300. and East Wenatchee, Washington East Wenatchee is a small city of about 11,480 people which sits on the eastern shore of the Columbia River in Douglas County, Washington, United States of America. East Wenatchee is the twin city of Wenatchee, Washington. , and relocated re·lo·cate v. re·lo·cat·ed, re·lo·cat·ing, re·lo·cates v.tr. To move to or establish in a new place: relocated the business. v.intr. branches in Lynden, Spokane Spokane, city, United States Spokane (spōkăn`), city (1990 pop. 177,196), seat of Spokane co., E Wash., at the spectacular falls of the Spokane River; inc. 1881. and Walla Walla, Washington Walla Walla is both the county seat of Walla Walla County, Washington, and the county's largest city. As of the 2000 census, the city population was 29,686GR6. . We also saw significant progress on construction and development of new offices in Vancouver, Washington, Boise, Idaho “Boise” redirects here. For other uses, see Boise (disambiguation). Boise is the capital and most populous city of the U.S. state of Idaho. It is the county seat of Ada County and the principal city of the Boise metropolitan area. , and Beaverton, Oregon and have moved forward on the four other southwestern south·west n. 1. Abbr. SW The direction or point on the mariner's compass halfway between due south and due west, or 135° west of due north. 2. An area or region lying in the southwest. 3. Idaho Idaho (ī`dəhō), one of the Rocky Mt. states in the NW United States. It is bordered by Montana and Wyoming (E), Utah and Nevada (S), Oregon and Washington (W), and the Canadian province of British Columbia (N). branch offices we expect to open within the next nine months. Operating expenses for the remainder of 2005 will be impacted by these new locations, but over time these new branches should help improve our net interest margin by proportionately pro·por·tion·ate adj. Being in due proportion; proportional. tr.v. pro·por·tion·at·ed, pro·por·tion·at·ing, pro·por·tion·ates To make proportionate. reducing our borrowing from the Federal Home Loan Bank," said Jones. Banner's net interest margin was 3.75% for the second quarter of 2005, a ten basis point improvement from 3.65% in the second quarter a year ago, and a four basis point improvement from the 3.71% margin for the first quarter of 2005. For the first six months of the year, the net interest margin was 3.73%, a six basis point improvement from 3.67% for the same period last year. "Although we experienced higher funding costs this quarter, we saw our net interest margin expand as a result of our strong loan growth and increased asset yields," said Jones. Funding costs were up 20 basis points compared to the previous quarter and up 52 basis points from the same quarter a year earlier. However, asset yields were also higher, increasing by 25 and 62 basis points, respectively, compared to the quarters ended March 31, 2005 and June 30, 2004. FHLB FHLB Federal Home Loan Bank Stock In contrast with last year, for the first six months of 2005 Banner Bank did not record any dividend income on its investment in stock of the Federal Home Loan Bank of Seattle Seattle (sēăt`əl), city (1990 pop. 516,259), seat of King co., W Wash., built on seven hills, between Elliott Bay of Puget Sound and Lake Washington; inc. 1869. (FHLB). For the quarter and six months ended June 30, 2004, Banner Bank recorded $349,000 and $694,000, respectively, of dividend income on its FHLB stock. In a recent filing with the Securities and Exchange Commission, the FHLB has indicated that it expects to generate only minimal earnings or possibly losses for the next two to three years. As a result, the management of Banner Bank does not expect that it will receive any dividend income on this stock for the foreseeable fore·see tr.v. fore·saw , fore·seen , fore·see·ing, fore·sees To see or know beforehand: foresaw the rapid increase in unemployment. future. However, for purposes of calculating asset yields and net interest margin for Banner Corporation, the $35.8 million investment in FHLB stock has been included in average securities and earning asset Earning asset An asset that generates income, e.g., income from rental property. balances. If this currently non-earning investment had been removed from these average balances, Banner Corporation's net interest margin would have been 3.80% and 3.78% for the quarter and six months ended June 30, 2005, and 3.76% for the quarter ended March 31, 2005. Further, this FHLB stock generally cannot be sold and the FHLB, in agreement with its regulator regulator, n the mechanical part of a gas delivery system that controls gas pressure that allows a manageable flow of drug vapor to escape. regulator see reducing valve. and in contrast with its past practice, is currently not redeeming re·deem tr.v. re·deemed, re·deem·ing, re·deems 1. To recover ownership of by paying a specified sum. 2. To pay off (a promissory note, for example). 3. excess stock holdings of its members. While there is little that Banner Bank can do with regard to this situation at this time, management will monitor the progress of the FHLB and will continue to evaluate the appropriate classification and valuation of this investment. Balance Sheet Review Banner Corporation's assets reached a record $3.14 billion at June 30, 2005, a 14% increase from $2.76 billion a year earlier. Net loans increased 21%, to $2.28 billion at June 30, 2005, from $1.88 billion a year ago. "The major components of the loan portfolio showed dramatic growth in the last year," said Jones. "We increased commercial and multifamily real estate loans 12%, construction and land loans 46% and commercial and agricultural business loans 17%. As a result, these components of total loans grew by 23% to $1.90 billion, and now represent 82% of the loan portfolio. In particular, our construction and development lending has been outstanding during the first half of 2005, reflecting the strong housing markets in the northwest For names and places containing the slightly longer word 'northwestern' (or variants), see . Northwest or north west is the ordinal direction halfway between north and west on a compass. It is the opposite of southeast. locations that Banner Bank serves and tremendous efforts from our lenders that focus on that line of business." Total deposits grew 19%, to $2.17 billion, compared to $1.83 billion at June 30, 2004. Non-interest bearing deposits increased 44% at June 30, 2005 compared to June 30, 2004, and increased 17% compared to March 31, 2005. Transaction and savings accounts grew 31% during the twelve months ending June 30, 2005, while certificates of deposit increased only 9%. "Our significant emphasis on deposit growth is bringing new customers to Banner Bank and is providing sufficient funding to support our loan growth," Jones continued. "Profitably growing our deposit base is the number one focus of our franchise expansion." Book value per share was $19.00 at June 30, 2005, compared to $18.08 a year earlier. Tangible Possessing a physical form that can be touched or felt. Tangible refers to that which can be seen, weighed, measured, or apprehended by the senses. A tangible object is something that is real and substantial. An automobile is an example of tangible Personal Property. book value per share was $15.87 at June 30, 2005, compared to $14.82 a year earlier. Credit Quality "We have been successful at managing credit risk while significantly growing the commercial loan portfolio," said Jones. Non-performing assets were $17.3 million, or 0.55% of total assets, at June 30, 2005, a 40% reduction from $28.9 million, or 1.05% of total assets, at June 30, 2004. At March 31, 2005, Banner's non-performing assets totaled $18.9 million or 0.64% of total assets. The provision for loan losses for the second quarter was $1.3 million, compared to $1.5 million in the same quarter of 2004. Net loan charge-offs in the second quarter of 2005 were 0.06% of average loans outstanding. At June 30, 2005, the allowance for loan losses totaled $29.8 million, representing 1.29% of total loans outstanding. Conference Call The Company will host a conference call today, Thursday Thursday: see week. , July 28, 2005, at 8:00 a.m. PDT PDT abbr. Pacific Daylight Time PDT Pacific Daylight Time PDT n abbr (US) (= Pacific Daylight Time) → hora de verano del Pacífico PDT , to discuss second quarter results. The conference call can be accessed live by telephone at 303-262-2211. To listen to the call online, go to the Company's website at www.bannerbank.com or to www.fulldisclosure.com. Institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. may access the call via the subscriber-only site, www.streetevents.com. An archived recording of the call can be accessed by dialing 303-590-3000, passcode 11032893# until Thursday, August 4, 2005, or via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.fulldisclosure.com. About the Company Banner Corporation is the parent company of Banner Bank, a commercial bank which operates a total of 52 branch offices and 13 loan offices in 24 counties in Washington This is a list of counties in Washington. There are thirty-nine counties in the U.S. state of Washington. Certain residents of Snohomish County consider themselves to be part of Freedom County. , Oregon Oregon, city, United States Oregon, city (1990 pop. 18,334), Lucas co., NW Ohio, a suburb adjacent to Toledo, on Lake Erie; inc. 1958. It is a port with railroad-owned and -operated docks. The city has industries producing oil, chemicals, and metal products. and Idaho. Banner Bank serves the Pacific Northwest region
The Northwest Region with a full range of deposit services and business, commercial real estate, construction, residential, agricultural and consumer loans. Visit Banner Bank on the Web at www.bannerbank.com. Statements concerning future performance, developments or events, expectations for earnings, growth and market forecasts, and any other guidance on future periods, constitute 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. , which are subject to a number of risks and uncertainties that are beyond Banner's control and might cause actual results to differ materially from the expectations and stated objectives. Factors which could cause actual results to differ materially include, but are not limited to, regional and general economic conditions, management's ability to generate continued improvement in asset quality and profitability, changes in interest rates, deposit flows, demand for mortgages and other loans, real estate values, competition, loan delinquency delinquency Criminal behaviour carried out by a juvenile. Young males make up the bulk of the delinquent population (about 80% in the U.S.) in all countries in which the behaviour is reported. rates, the successful operation of the newly-opened branches and loan offices, changes in accounting principles, practices, policies or guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. , changes in legislation or regulation, other economic, competitive, governmental, 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. and technological factors affecting operations, pricing, products and services and Banner's ability to successfully resolve outstanding credit issues and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. recover check kiting The unlawful practice of drawing checks against a bank account containing insufficient funds to cover them, with the expectation that the necessary funds will be deposited before such checks are presented for payment. losses. Accordingly, these factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. Banner undertakes no responsibility to update or revise any forward-looking statements.
RESULTS OF OPERATIONS Quarters Ended
------------------------------ --------------------------------------
(In thousands except share Jun 30, Mar 31, Jun 30,
and per share data) 2005 2005 2004
------------ ----------- -----------
INTEREST INCOME:
Loans receivable $ 39,842 $ 36,137 $ 30,298
Mortgage-backed securities 3,586 3,673 4,394
Securities and cash
equivalents 2,943 2,849 3,140
------------ ----------- -----------
46,371 42,659 37,832
INTEREST EXPENSE:
Deposits 12,146 10,414 8,404
Federal Home Loan Bank
advances 5,927 5,617 4,962
Junior subordinated
debentures 1,193 1,067 843
Other borrowings 392 332 223
------------ ----------- -----------
19,658 17,430 14,432
------------ ----------- -----------
Net interest income before
provision for loan losses 26,713 25,229 23,400
PROVISION FOR LOAN LOSSES 1,300 1,203 1,450
------------ ----------- -----------
Net interest income 25,413 24,026 21,950
OTHER OPERATING INCOME:
Deposit fees and other
service charges 2,401 2,004 2,057
Mortgage banking operations 1,645 1,231 1,452
Loan servicing fees 232 439 347
Gain on sale of securities 8 - - 62
Miscellaneous 339 323 207
------------ ----------- -----------
Total other operating income 4,625 3,997 4,125
OTHER OPERATING EXPENSE:
Salary and employee benefits 15,263 13,793 13,024
Less capitalized loan
origination costs (2,753) (2,041) (1,891)
Occupancy and equipment 3,394 3,227 2,645
Information / computer data
services 1,193 1,117 1,016
Professional services 818 801 790
Advertising 1,512 1,351 1,341
Miscellaneous 3,373 3,055 2,611
------------ ----------- -----------
Total other operating expense 22,800 21,303 19,536
------------ ----------- -----------
Income before provision for
income taxes 7,238 6,720 6,539
PROVISION FOR INCOME TAXES 2,222 2,013 1,991
------------ ----------- -----------
NET INCOME $ 5,016 $ 4,707 $ 4,548
============ =========== ===========
Earnings per share
Basic $ 0.43 $ 0.41 $ 0.41
Diluted $ 0.42 $ 0.39 $ 0.39
Cumulative dividends declared
per common share $ 0.17 $ 0.17 $ 0.16
Weighted average shares
outstanding
Basic 11,531,987 11,470,028 11,140,502
Diluted 11,895,158 11,920,812 11,720,499
Shares repurchased during the
period 67,522 8,028 11,953
RESULTS OF OPERATIONS 6 Months Ended
------------------------------ ------------------------
(In thousands except share Jun 30, Jun 30,
and per share data) 2005 2004
----------- -----------
INTEREST INCOME:
Loans receivable $ 75,979 $ 59,317
Mortgage-backed securities 7,259 8,921
Securities and cash
equivalents 5,792 6,221
----------- -----------
89,030 74,459
INTEREST EXPENSE:
Deposits 22,560 16,268
Federal Home Loan Bank
advances 11,544 10,087
Junior subordinated
debentures 2,260 1,535
Other borrowings 724 460
----------- -----------
37,088 28,350
----------- -----------
Net interest income before
provision for loan losses 51,942 46,109
PROVISION FOR LOAN LOSSES 2,503 2,900
----------- -----------
Net interest income 49,439 43,209
OTHER OPERATING INCOME:
Deposit fees and other
service charges 4,405 3,900
Mortgage banking operations 2,876 2,704
Loan servicing fees 671 613
Gain on sale of securities 8 73
Miscellaneous 662 651
----------- -----------
Total other operating income 8,622 7,941
OTHER OPERATING EXPENSE:
Salary and employee benefits 29,056 25,127
Less capitalized loan
origination costs (4,794) (3,378)
Occupancy and equipment 6,621 5,132
Information / computer data
services 2,310 2,042
Professional services 1,619 1,705
Advertising 2,863 2,449
Miscellaneous 6,428 5,287
----------- -----------
Total other operating expense 44,103 38,364
----------- -----------
Income before provision for
income taxes 13,958 12,786
PROVISION FOR INCOME TAXES 4,235 3,875
----------- -----------
NET INCOME $ 9,723 $ 8,911
=========== ===========
Earnings per share
Basic $ 0.85 $ 0.80
Diluted $ 0.82 $ 0.76
Cumulative dividends declared
per common share $ 0.34 $ 0.32
Weighted average shares
outstanding
Basic 11,501,178 11,095,844
Diluted 11,907,919 11,685,980
Shares repurchased during the
period 75,550 19,682
FINANCIAL CONDITION
------------------
(In thousands
except share and Jun 30, Mar 31, Jun 30, Dec 31,
per share data) 2005 2005 2004 2004
----------- ----------- ----------- -----------
ASSETS
------------------
Cash and due from
banks $ 82,266 $ 57,994 $ 53,699 $ 51,767
Securities
available for
sale 526,629 540,706 600,048 547,835
Securities held to
maturity 50,801 50,515 51,211 49,914
Federal Home Loan
Bank stock 35,844 35,844 35,387 35,698
Loans receivable:
Held for sale 5,837 3,217 5,887 2,145
Held for
portfolio 2,308,808 2,158,620 1,903,532 2,090,703
Allowance for
loan losses (29,788) (29,736) (28,037) (29,610)
----------- ----------- ----------- -----------
2,284,857 2,132,101 1,881,382 2,063,238
Accrued interest
receivable 17,015 15,982 14,341 15,097
Real estate owned
held for sale,
net 1,290 1,034 3,564 1,485
Property and
equipment, net 45,091 42,261 32,815 39,315
Goodwill and other
intangibles, net 36,325 36,347 36,441 36,369
Deferred income
tax asset, net 6,612 7,964 7,024 5,888
Bank-owned life
insurance 36,154 35,773 34,529 35,371
Other assets 15,573 16,261 9,629 15,090
----------- ----------- ----------- -----------
$ 3,138,457 $ 2,972,782 $ 2,760,070 $ 2,897,067
=========== =========== =========== ===========
LIABILITIES
-----------
Deposits:
Non-interest-
bearing $ 302,266 $ 257,437 $ 209,704 $ 234,761
Interest-bearing 1,872,649 1,737,093 1,622,889 1,691,148
----------- ----------- ----------- -----------
2,174,915 1,994,530 1,832,593 1,925,909
Borrowings:
Advances from
Federal Home
Loan Bank 566,458 594,958 555,058 583,558
Junior
subordinated
debentures 72,168 72,168 72,168 72,168
Other borrowings 65,905 63,263 72,539 68,116
----------- ----------- ----------- -----------
704,531 730,389 699,765 723,842
Accrued expenses
and other
liabilities 27,511 25,294 17,911 25,027
Deferred
compensation 4,597 5,531 4,739 5,208
Income taxes
payable 6,185 3,375 2,768 1,861
----------- ----------- ----------- -----------
2,917,739 2,759,119 2,557,776 2,681,847
STOCKHOLDERS'
EQUITY
------------------
Common stock 128,210 127,829 125,438 127,460
Retained earnings 98,124 95,082 85,494 92,327
Accumulated other
comprehensive
income (loss) (1,952) (5,613) (4,461) (888)
Unearned shares of
common stock
issued to Employee
Stock Ownership Plan
(ESOP) trust: at
cost (3,096) (3,096) (3,628) (3,096)
Net carrying value
of stock related
deferred
compensation plans (568) (539) (549) (583)
----------- ----------- ----------- -----------
220,718 213,663 202,294 215,220
----------- ----------- ----------- -----------
$ 3,138,457 $ 2,972,782 $ 2,760,070 $ 2,897,067
=========== =========== =========== ===========
Shares Issued:
Shares outstanding
at end of period 11,991,074 11,890,541 11,630,434 11,856,889
Less unearned
ESOP shares at
end of period 374,595 374,595 438,985 374,595
----------- ----------- ----------- -----------
Shares outstanding
at end of period
excluding unearned
ESOP shares 11,616,479 11,515,946 11,191,449 11,482,294
=========== =========== =========== ===========
Book value
per share (1) $ 19.00 $ 18.55 $ 18.08 $ 18.74
Tangible book
value per share
(1) $ 15.87 $ 15.40 $ 14.82 $ 15.58
Consolidated
Tier 1 leverage
capital ratio 8.55% 8.72% 8.86% 8.93%
(1) Calculation is based on number of shares outstanding at the end of
the period rather than weighted average shares outstanding and
excludes unallocated shares in the employee stock ownership plan
(ESOP).
ADDITIONAL FINANCIAL INFORMATION
(Dollars in thousands)
LOANS (including loans Jun 30, Mar 31, Jun 30, Dec 31,
held for sale): 2005 2005 2004 2004
---------------------- ---------- ---------- ---------- ----------
Commercial real estate $ 562,240 $ 559,195 $ 506,411 $ 547,574
Multifamily real
estate 119,668 113,205 104,936 107,745
Construction and land 631,557 554,560 433,611 506,137
Commercial business 436,428 406,948 340,493 395,249
Agricultural business
including secured by
farmland 149,651 130,776 160,920 148,343
One- to four-family
real estate 337,157 316,345 287,990 307,986
Consumer 77,944 80,808 75,058 79,814
---------- ---------- ---------- ----------
Total loans
outstanding $2,314,645 $2,161,837 $1,909,419 $2,092,848
========== ========== ========== ==========
Jun 30, Mar 31, Jun 30, Dec 31,
NON-PERFORMING ASSETS: 2005 2005 2004 2004
---------------------- ---------- ---------- ---------- ----------
Loans on non-accrual
status $ 15,859 $ 17,718 $ 24,118 $ 15,416
Loans more than 90
days delinquent,
still on accrual 110 108 1,139 472
---------- ---------- ---------- ----------
Total non-performing
loans 15,969 17,826 25,257 15,888
Real estate owned
(REO)/Repossessed
assets 1,290 1,072 3,613 1,559
---------- ---------- ---------- ----------
Total non-performing
assets $ 17,259 $ 18,898 $ 28,870 $ 17,447
========== ========== ========== ==========
Total non-performing
assets/Total assets 0.55% 0.64% 1.05% 0.60%
Quarters Ended 6 Months Ended
------------------------- ---------------
CHANGE IN THE Jun 30, Mar 31, Jun 30, Jun 30, Jun 30,
ALLOWANCE FOR LOAN LOSSES: 2005 2005 2004 2005 2004
-------------------------- ------- ------- ------- ------- -------
Balance, beginning of
period $29,736 $29,610 $26,885 $29,610 $26,060
Provision 1,300 1,203 1,450 2,503 2,900
Recoveries of loans
previously charged off 219 373 285 592 436
Loans charged-off (1,467) (1,450) (583) (2,917) (1,359)
------- ------- ------- ------- -------
Net (charge-offs)
recoveries (1,248) (1,077) (298) (2,325) (923)
------- ------- ------- ------- -------
Balance, end of period $29,788 $29,736 $28,037 $29,788 $28,037
======= ======= ======= ======= =======
Net charge-offs/Average
loans outstanding 0.06% 0.05% 0.02% 0.11% 0.05%
Allowance for loan losses/
Total loans outstanding 1.29% 1.38% 1.47% 1.29% 1.47%
ADDITIONAL FINANCIAL INFORMATION
(Dollars in thousands)
(Rates/Ratios Annualized)
Quarters Ended
----------------------------------
Jun 30, Mar 31, Jun 30,
OPERATING PERFORMANCE: 2005 2005 2004
---------------------- ---------- ---------- ----------
Average loans $2,224,089 $2,125,833 $1,858,449
Average securities and deposits 630,141 633,420 721,778
Average non-interest-earning
assets 175,689 169,633 149,293
---------- ---------- ----------
Total average assets $3,029,919 $2,928,886 $2,729,520
========== ========== ==========
Average deposits $2,069,062 $1,960,545 $1,776,837
Average borrowings 708,660 719,544 725,047
Average non-interest-earning
liabilities 32,393 29,163 20,468
---------- ---------- ----------
Total average liabilities 2,810,115 2,709,252 2,522,352
Total average stockholders' equity 219,804 219,634 207,168
---------- ---------- ----------
Total average liabilities and
equity $3,029,919 $2,928,886 $2,729,520
========== ========== ==========
Interest rate yield on loans 7.19% 6.89% 6.56%
Interest rate yield on securities
and deposits 4.16% 4.18% 4.20%
---------- ---------- ----------
Interest rate yield on interest-
earning assets 6.52% 6.27% 5.90%
---------- ---------- ----------
Interest rate expense on deposits 2.35% 2.15% 1.90%
Interest rate expense on
borrowings 4.25% 3.95% 3.34%
---------- ---------- ----------
Interest rate expense on
interest-bearing liabilities 2.84% 2.64% 2.32%
---------- ---------- ----------
Interest rate spread 3.68% 3.63% 3.58%
========== ========== ==========
Net interest margin 3.75% 3.71% 3.65%
========== ========== ==========
Other operating income/Average
assets 0.61% 0.55% 0.61%
Other operating expense/Average
assets 3.02% 2.95% 2.88%
Efficiency ratio (other operating
expense/revenue) 72.76% 72.89% 70.98%
Return on average assets 0.66% 0.65% 0.67%
Return on average equity 9.15% 8.69% 8.83%
Average equity/Average assets 7.25% 7.50% 7.59%
6 Months Ended
----------------------
Jun 30, Jun 30,
OPERATING PERFORMANCE: 2005 2004
---------------------------------- ---------- ----------
Average loans $2,175,233 $1,804,723
Average securities and deposits 631,771 718,912
Average non-interest-earning
assets 172,678 156,365
---------- ----------
Total average assets $2,979,682 $2,680,000
========== ==========
Average deposits $2,015,104 $1,723,673
Average borrowings 714,072 728,918
Average non-interest-earning
liabilities 30,787 19,968
---------- ----------
Total average liabilities 2,759,963 2,472,559
Total average stockholders' equity 219,719 207,441
---------- ----------
Total average liabilities and
equity $2,979,682 $2,680,000
========== ==========
Interest rate yield on loans 7.04% 6.61%
Interest rate yield on securities
and deposits 4.17% 4.24%
---------- ----------
Interest rate yield on interest-
earning assets 6.40% 5.93%
---------- ----------
Interest rate expense on deposits 2.26% 1.90%
Interest rate expense on
borrowings 4.10% 3.33%
---------- ----------
Interest rate expense on
interest-bearing liabilities 2.74% 2.32%
---------- ----------
Interest rate spread 3.66% 3.61%
========== ==========
Net interest margin 3.73% 3.67%
========== ==========
Other operating income/Average
assets 0.58% 0.60%
Other operating expense/Average
assets 2.98% 2.88%
Efficiency ratio (other operating
expense/revenue) 72.82% 70.98%
Return on average assets 0.66% 0.67%
Return on average equity 8.92% 8.64%
Average equity/Average assets 7.37% 7.74%
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