Citizens Banking Corporation Fourth Quarter Results and Dividend Announcement.Business Editors FLINT flint, mineral flint, variety of quartz that commonly occurs in rounded nodules and whose crystal structure is not visible to the naked eye. Flint is dark gray, smoky brown, or black in color; pale gray flint is called chert. , Mich.--(BUSINESS WIRE)--Jan. 15, 2004 Citizens Banking Corporation (Nasdaq:CBCF CBCF Canadian Breast Cancer Foundation CBCF Congressional Black Caucus Foundation CBCF Community Based Corrections Facilities CBCF Commander, Base Communications Facility ) announced net income of $18,074,000 or $0.41 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 for the three months ended December December: see month. 31, 2003, compared to net income of $21,525,000 or $0.48 per diluted share in the same quarter of 2002. The decrease in net income was attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to lower net interest income, as the net interest margin declined in the continued low interest rate environment, and was also attributable to a decline in mortgage banking income resulting from significantly lower mortgage origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real volume. Higher noninterest expense also contributed to the decline in net income. The provision for loan losses decreased, as credit quality improved, partially offsetting the decline in revenue and the increase in noninterest expense. Returns on average assets and average equity during the fourth quarter were 0.93% and 11.45%, respectively, compared with 1.13% and 13.06%, in the fourth quarter of 2002. For the year ended December 31, 2003, Citizens recorded net income of $65,951,000 or $1.51 per diluted share compared to $25,038,000 or $0.56 per diluted share for 2002, an increase of 163% and 170%, respectively. The increase in net income for 2003 was due primarily to the actions taken in the third quarter of 2002 to restructure the company along its three major lines of business and improve its credit quality risk profile. Those actions resulted in an $89.3 million loan loss provision and special and other charges of $23.2 million in the third quarter of 2002. For the full year 2003, the provision for loan losses declined $57.2 million to $63.0 million compared with $120.2 million in 2002. Noninterest expense declined $26.4 million as a result of the prior year special and other charges and, to a lesser extent, lower compensation expense. Returns on average assets and average equity for the year were 0.86% and 10.44%, respectively, compared with 0.33% and 3.62% for 2002. "We're we're Contraction of we are. we're we are pleased to generate another solid quarter of credit quality improvement," stated William William, crown prince of Germany William or Frederick William, 1882–1951, crown prince of Germany, son of William II. In World War I he commanded (1914) an army on the Western Front and was nominal commander in the German attack R. Hartman Hartman may refer to: Surname
Key Highlights of the Quarter: -- The provision for loan losses and net charge-offs continued to trend downward in the fourth quarter. The provision for loan losses declined by 22% to $8.0 million and net charge-offs decreased 25% to $7.7 million for the fourth quarter compared to the third quarter 2003. -- 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. decreased $14.2 million or 15.6% to $77.0 million from third quarter 2003 levels, representing 1.47% of total loans, down from 1.76% a year ago and 1.74% last quarter. Commercial nonperforming asset inflows slowed to $17.8 million for the quarter from $21.1 million in the third quarter of 2003 while outflows totaled $32.8 million. -- Citizens' consumer banking line of business completed two successful product campaigns during the fourth quarter. The Home Equity campaign resulted in $100 million of new home equity loans representing outstanding balances of over $66 million. A checking account promotion resulted in over 8,000 new checking accounts with balances in excess of $41 million. -- Citizens Bank Wealth Management, N.A. successfully completed the conversion of its trust and investment accounting systems and operations and the conversion of its retirement services recordkeeping systems and operations. -- Citizens' treasury management business unit successfully implemented a full-service full-ser·vice adj. Associated with or offering complete service: full-service gasoline pumps; full-service banks. wholesale and retail image-enabled lockbox Lockbox A collection and processing service provided to firms by banks, which collect payments from a dedicated postal box to which the firm directs its customers to send payment to. to process client receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed and introduced significant enhancements to its commercial internet banking solution during the quarter. Balance Sheet Citizens' total assets at December 31, 2003 were $7.711 billion, a decrease of $76 million or 0.98% from September September: see month. 30, 2003 and an increase of $186 million or 2.5% from December 31, 2002. Total assets increased from December 31, 2002 levels due to the expansion of the investment portfolio in the first half of 2003 partially offset by a decline in loans and mortgage loans held for sale. Total assets declined from September 30, 2003 levels due to a decrease in mortgage loans held for sale. Loans increased $19.3 million or 0.37% from September 30, 2003 and decreased $186.9 million or 3.4% from December 31, 2002. Commercial loan balances decreased $44.2 million or 1.5% from September 30, 2003 and $308.3 million or 9.4% from December 31, 2002 resulting from increased activity in fixed-rate loan Fixed-rate loan A loan whose rate is fixed for the life of the loan. refinancing Refinancing An extension and/or increase in amount of existing debt. and paydowns, lower demand for commercial credit and earlier identification and reduction of exposure on credits with the potential to deteriorate de·te·ri·o·rate v. 1. To grow worse in function or condition. 2. To weaken or disintegrate. . The decline in the fourth quarter occurred in Citizens' 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 market and the overall decline for 2003 occurred in all markets. Consumer loans, excluding mortgage loans, increased $58.0 million or 3.4% from September 30, 2003 and $250.0 million or 16.5% from December 31, 2002. Home equity loans increased $69.0 million or 10.2% from September 30, 2003 and $196.5 million or 35.6% from December 31, 2002. Three very successful home equity marketing campaigns conducted during the second, third and fourth quarters drove the exceptional growth in this product line. Other direct loans declined $12.1 million and $34.4 million compared with September 30, 2003 and December 31, 2002, respectively, as a result of higher prepayments Prepayments Payments made in excess of scheduled mortgage principal repayments. due to the low interest rate environment. Indirect loans increased $1.1 million and $87.9 million compared with September 30, 2003 and December 31, 2002, respectively, as a result of capturing a greater share from Citizens' existing dealer base. Mortgage loans remained virtually flat at December 31, 2003 compared with September 30, 2003 levels, but declined $128.6 million from December 31, 2002 as most new origination volume was sold into the secondary market. Mortgage origination volume increased during 2003 as Citizens continued to benefit from the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. interest rate environment with refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. business comprising a majority of the volume. For 2003, closed mortgage volume was approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $1.44 billion, a record volume for Citizens, compared to $1.27 billion in 2002. Total deposits were $5.442 billion as of December 31, 2003, compared to $5.482 billion as of September 30, 2003, and $5.937 billion as of December 31, 2002, a decrease of 0.7% and 8.3% respectively. This decline reflects Citizens' less aggressive deposit pricing posture posture /pos·ture/ (pos´choor) the attitude of the body.pos´tural pos·ture n. 1. A position of the body or of body parts. 2. during the lower interest rate environment which caused retail and other CDs to decline by $421.7 million at December 31, 2003 compared with December 31, 2002. Core deposits increased $3.6 million at December 31, 2003 compared with September 30, 2003 as a result of a retail deposit campaign. Credit Quality Nonperforming assets totaled $77.0 million or 1.0% of assets, at December 31, 2003, representing a decrease of $14.2 million or 15.6% from September 30, 2003 levels and $18.6 million or 19.5% from December 31, 2002 levels. The allowance for loan losses increased to $123.5 million or 2.36% of loans at December 31, 2003 compared with $106.8 million at December 31, 2002. The allowance for loan losses as a percent of nonperforming loans increased to 178.8% compared to 147.0% at September 30, 2003 and 121.9% at December 31, 2002. Net loans charged off during the quarter totaled $7.7 million or 0.59% of average loans (annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. ), compared with $10.3 million in the third quarter of 2003 and $11.0 million in the fourth quarter of 2002. The provision for loan losses declined to $8.0 million in the fourth quarter compared with $16.3 million in the fourth quarter of 2002 and $10.3 million in the third quarter of 2003, reflecting the decline in net charge-offs and improvement in nonperforming loans. The continued improvement in credit quality in the second half of 2003 reflects the results of Citizens' commitment to proactive risk identification and management strategies and strengthened underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. and approval practices. "During the fourth quarter, we created a Major Credit Exposure Review function, reporting to the chief credit officer, providing us improved management of both industry and individual customer loan concentrations," John D. Schwab Schwab is a German name meaning "man from Swabia" and may refer to:
EVP EGR (Exhaust Gas Recirculation) Valve Position Sensor EVP Electronic Voice Phenomenon EVP Europäische Volkspartei (Germany) EVP Employee Value Proposition and chief credit officer commented. "We believe this step will further strengthen our portfolio risk management capabilities and enable more proactive management of exposure and concentrations." Net Interest Margin and Net Interest Income Net interest margin was 4.07% in the fourth quarter of 2003 compared to 4.06% in the third quarter of 2003 and 4.49% in the fourth quarter of 2002. The small increase in net interest margin in the fourth quarter of 2003 compared to the third quarter is the result of lower purchase premium amortization expense on mortgage related securities, and lower funding costs, largely offset by yield declines on fixed rate loans. The decline in net purchase premium amortization expense from the third quarter to the fourth quarter of 2003 was $1.5 million. The decline in funding costs was driven primarily by the CD portfolio, with much smaller contributions from transaction and savings products and long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. . For the twelve months ended December 31, 2003 net interest margin declined to 4.15% from 4.45% compared to the prior year. This decline is attributable to the asset sensitive position held prior to the second quarter of 2003, accelerated prepayments in both the fixed rate commercial loan portfolio and the mortgage related securities portfolio, plus a mix shift in earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin from loans to lower yielding securities. Net interest income decreased $0.5 million in the fourth quarter of 2003 compared to the third quarter of 2003, due to slightly lower earning assets. Average earning assets decreased $99 million in the fourth quarter compared with the previous quarter as declines in mortgages held for sale and the commercial loan portfolio more than offset growth in consumer loan and investment security balances. Compared to the fourth quarter of 2002, net interest income declined $5.6 million due to a decrease in the net interest margin partially offset by an increase of $138 million in earning assets. For the full year 2003, net interest income declined $15.5 million from the prior year due to a 30 basis point decline in net interest margin partially offset by an increase of $112 million in earning assets. Citizens expects its net interest margin in the first quarter of 2004 to be flat to slightly lower compared to fourth quarter 2003 levels. Noninterest Income Noninterest income for the three months ended December 31, 2003 totaled $21.6 million, a decrease of $5.1 million, or 19.0%, from the same period in 2002. The decrease was the result of a $4.9 million decline in mortgage income from significantly lower mortgage loan origination 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. volume. Mortgage loan origination volume totaled $158 million in the fourth quarter of 2003, as compared to $468 million in the fourth quarter of 2002. Brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. and investment fees declined $0.8 million due to lower retail sales of fixed annuity Fixed Annuity An insurance contract in which the insurance company makes fixed dollar payments to the annuitant for the term of the contract, usually until the annuitant dies. The insurance company guarantees both earnings and principal. products. Deposit service charges increased $1.4 million from higher consumer and commercial overdraft A check that is drawn on an account containing less money than the amount stated on the check. The term overdraft is also used in reference to the condition that exists when vouchers fee income, partially offsetting the decline in mortgage and brokerage and investment fee income. Trust fees were down $81,000 or 1.7% to $4.6 million from the same quarter a year ago. Total trust assets under administration were $2.866 billion at December 31, 2003, an increase of $311.0 million from December 31, 2002, and an increase of $259.0 million from September 30, 2003. Noninterest income for the year ended December 31, 2003 was $94.8 million compared to $101.8 million in 2002, a decline of $7.0 million. Gains of $7.8 million recorded in the second quarter of 2002 resulting from the sale of securitized securitized Of, related to, or being debt securities that are secured with assets. For example, mortgage purchase bonds are secured by mortgages that have been purchased with the bond issue's proceeds. mortgages and the sale of the merchant services Merchant services is the name given in the United States to a broad category of financial services intended for use by businesses. In its most specific use, it usually refers to the service that enables a business to accept a transaction payment by use of the customer's credit or business accounted for the decline. Additionally, bankcard bank·card n. A card issued by a bank authorizing the holder to receive bank services and often functioning as a debit card. fees declined $3.1 million in 2003 compared to the prior year due to the June June: see month. 2002 sale of the merchant services business. Brokerage and investment fees declined $1.8 million in 2003 compared to 2002, as a result of lower retail sales of fixed annuity products. Trust fees declined $1.4 million in 2003 compared with the prior year due to lower average asset levels resulting from the decline in the financial markets during the latter half of 2002 and the first quarter of 2003, and client attrition Attrition The reduction in staff and employees in a company through normal means, such as retirement and resignation. This is natural in any business and industry. Notes: . Service charges on deposit accounts increased $3.5 million in 2003 compared to the prior year due to higher overdraft fee income. Mortgage and other loan income increased $1.2 million due to higher volume of mortgage loan originations for the full year 2003. Other noninterest income increased $2.4 million in 2003 compared with the prior year due in part to the third quarter 2002 charge of $1.6 million and increased life insurance income as a result of the purchase of $78 million of bank owned life insurance in the third quarter of 2002. Citizens expects noninterest income levels in the first quarter of 2004 to be slightly higher than fourth quarter 2003 levels. Noninterest Expense Noninterest expense for the quarter ended December 31, 2003 was $60.4 million, up 5.8% from $57.1 million in the fourth quarter of 2002. Advertising and public relations public relations, activities and policies used to create public interest in a person, idea, product, institution, or business establishment. By its nature, public relations is devoted to serving particular interests by presenting them to the public in the most expenses increased $2.1 million for the quarter due in part to Citizens previously announced expansion into Oakland County, Michigan Oakland County is a county in the U.S. state of Michigan. As of 2005, the population was estimated at 1,214,361.[2] The county seat is Pontiac6. Oakland County is part of the Detroit metropolitan area, though the actual city of Detroit is located in . New home equity and checking account promotions implemented in the fourth quarter of 2003 also contributed to the increase. Occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy expense increased $0.8 million reflecting higher maintenance costs and expenses related to a fourth quarter 2003 capital investment of $1.7 million in branch renovations. The additional expense of approximately $0.2 million related to these renovations in the quarter was due to a change in Citizens' capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. policy incorporating higher capitalization thresholds on new expenditures. Partially offsetting the increased occupancy costs Occupancy costs are the whole life costs of buildings and their associated land from occupancy until disposal. These costs may be incurred on a regular or irregular basis. Occupancy costs are those costs related to occupying a space including; rent, real estate taxes, personal were the favorable effects of fewer branch locations as a result of the third quarter 2002 restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). . Other noninterest expense increased $1.2 million for the quarter due in part to system implementation costs of $0.4 million associated with new strategic alliances between our trust bank subsidiary, Citizens Bank Wealth Management N.A. and three third party vendors, SEI Investments, EnvestnetPMC and EPIC Advisors, Inc. Salaries and employee benefits expense decreased $0.8 million for the quarter, net of $0.3 million of severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when costs for the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. trust bank strategic alliances, due to lower staffing levels resulting from the third quarter of 2002 restructuring initiatives and normal attrition. Equipment expenses decreased $0.9 million due to lower depreciation expense as Citizens accelerated, in the fourth quarter of 2002, its depreciation on certain branch and ATM equipment scheduled for early retirement in the first half of 2003. For the year ending December 31, 2003, noninterest expense decreased $26.4 million or 10.2% from 2002. The decline was primarily attributable to a special charge of $13.4 million recorded in the second half of 2002 to restructure Citizens' three major lines of business (consumer banking, commercial banking and wealth management) and $7.1 million of other charges recorded in the third quarter of 2002. The $7.1 million of other charges included a $3.3 million prepayment penalty Prepayment penalty A fee a borrower pays a lender when the borrower repays a loan before its scheduled time of maturity. on high cost FHLB FHLB Federal Home Loan Bank debt, a $2.0 million contribution to Citizens' charitable trust The arrangement by which real or Personal Property given by one person is held by another to be used for the benefit of a class of persons or the general public. , a $1.0 million market valuation adjustment to other real estate, $0.4 million of additional equipment depreciation and other charges of $0.4 million. The decline in noninterest expense for the year also reflected reductions in salaries and employee benefits, equipment expense and bankcard expense. Salaries and employee benefits were down $4.5 million for the twelve months ended December 31, 2003 for the same reasons as they were down for the quarter. Citizens' had 2,342 full time equivalent employees at December 31, 2003, down from 2,520 at December 31, 2002, a 7.1% decline. Equipment expenses decreased $3.8 million due to lower depreciation and improved pricing from new or renegotiated maintenance contracts. A $0.4 million charge in the third quarter of 2002 for additional depreciation on equipment to be retired early (mentioned previously above) also contributed to the decrease. Bankcard expense declined $3.5 million as Citizens sold its merchant services business in the second quarter of 2002. These decreases were partially offset by increases in professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. , advertising and public relations costs and system implementation and severance costs. Professional services were up $3.0 million for the year reflecting higher legal costs related to loan collection efforts, increased executive recruiting and relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation. 2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. costs, implementation costs for Citizens' new INEA INEA Istituto Nazionale di Economia Agraria (Italian: National Institute of Agricultural Economics) INEA Instituto Nacional de Educación para los Adultos (Spanish: National Institute for Adult Education; Mexico) Performance Management software, additional costs associated with engagement of banking industry consultants who assisted in the restructuring and costs incurred for the collateral collateral (kəlăt`ərəl), something of value given or pledged as security for payment of a loan. Collateral consists usually of financial instruments, such as stocks, bonds, and negotiable paper, rather than physical goods, although field audit initiative begun in March of 2003. Advertising and public relations expenses increased $0.7 million due to Citizens' recently announced expansion into Oakland County, Michigan and several new home equity and checking account promotions during the year. These additional promotion costs were offset, in part, by a more focused marketing strategy, seeking higher promotional exposure at lower costs. System implementation and severance costs for 2003 totaled $1.2 million and $0.6 million, respectively, for the aforementioned trust bank strategic alliances. For the first quarter of 2004, Citizens anticipates that noninterest expense will increase slightly due to the continuation continuation - continuation passing style of process improvement initiatives, ongoing staff training and expected advertising and other expenditures related to the expansion in Oakland Oakland, city (1990 pop. 372,242), seat of Alameda co., W Calif., on the eastern side of San Francisco Bay; inc. 1852. Together with San Francisco and San Jose, the city comprises the fourth largest metropolitan area in the United States. County. Initiatives Citizens completed 29 initiatives during 2003 as part of its 'Achieving the Vision' project. Some of the key projects included a significant upgrade to and testing of the business continuity and contingency plan A plan involving suitable backups, immediate actions and longer term measures for responding to computer emergencies such as attacks or accidental disasters. Contingency plans are part of business resumption planning. ; a check imaging and archival system; significant enhancements to the branch wide area network; systems and product enhancements; many branch facility improvements; and a significant number of process and procedural improvements to enhance controls and productivity. "As part of the 'Achieving the Vision' initiative and to enable us to be more market driven, new market teams are being formed to ensure maximum teamwork (product, software, tool) Teamwork - A SASD tool from Sterling Software, formerly CADRE Technologies, which supports the Shlaer/Mellor Object-Oriented method and the Yourdon-DeMarco, Hatley-Pirbhai, Constantine and Buhr notations. across lines of business. Seven pilot teams have been active since October October: see month. 1, 2003, and nine new teams will become active in January January: see month. 2004. The teams will focus on deposit and loan growth within each market, fee income growth, and improving teamwork across lines of business to create a more seamless See seamless integration. approach to client service, while managing their interest margin and credit quality. We also remain committed to strongly supporting the communities we serve," informed Roy Roy, city (1990 pop. 24,603), Weber co., N Utah, near Great Salt Lake; settled by Mormons 1877, inc. 1937. Computer equipment is manufactured, and many residents work at nearby Hill Air Force Base. A. Eon, EVP and head of operations and technology. "I am pleased to announce that during 2003, over 2,200 staff members attended Citizens University I, an internal school established to educate participants on Citizens' Vision and how to implement its six components," commented Hartman. "And over 500 managers within the organization attended Citizens University II, which assists managers with coaching, staff development and performance appraisals Performance appraisal, also known as employee appraisal, is a method by which the performance of an employee is evaluated (generally in terms of quality, quantity, cost and time). that more closely align align (  līn),v to move the teeth into their proper positions to conform to the line of occlusion. with our Corporate objectives," he continued. Dividend Announcement The Board of Directors of Citizens Banking Corporation declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. a cash dividend of $0.285 per share of common stock. The dividend is payable on February February: see month. 4, 2004, to shareholders of record on January 23, 2004. Other News Citizens Banking Corporation announced on November November: see month. 24, 2003, a major expansion in Oakland County, Michigan. The company intends to make a capital investment of $35 to $40 million and to open as many as 10 to 14 new branches, including two hub offices over the next 24 months. This initiative will significantly add to the Bank's current Oakland County presence of seven branches, increase its staff by up to 180 employees, give local bankers greater authority to act quickly on loan applications and other decisions, and give the marketplace convenient access to bankers. "Oakland County presents us with a unique opportunity to grow our business banking portfolio, wealth management clients, and establish Citizens Bank as a leading commercial bank in the market," remarked Hartman. The company also announced that it plans to open its first location connected with the expansion initiative early in the first quarter of 2004. This initial location at 900 Tower Drive, a premier landmark A structure that has significant historical, architectural, or cultural meaning and that has been given legal protection from alteration and destruction. Although landmark preservation laws vary by city and state, they have the same basic purpose: to keep landmarks as close site in the heart of Troy's Northfield Northfield, city (1990 pop. 14,684), Rice co., SE Minn., near Minneapolis–St. Paul, on the Cannon River; inc. 1875. It is the trade center for a dairy and farming region. Manufactures include printed circuit boards, toys, feeds and seeds, and cereals. On Sept. Corporate Campus, will encompass a new bank branch and administrative office space and will serve as one of two major Citizens Bank hubs hubs - hub in Oakland County. The 900 Tower Building will carry the Citizens Bank mark atop the building. In late November, Citizens Bank Wealth Management, N.A. successfully completed the conversion of its trust and investment accounting systems and operations with SEI Investments. Furthermore, the conversion of its retirement services recordkeeping systems and operations was completed with EPIC Advisors, Inc. "The completion of these conversions will enable us to leverage our previously announced strategic relationships with SEI Investments, EnvestnetPMC, Inc., and EPIC Advisors, Inc. to offer our wealth management clients a broader range of mutual fund family choices, access to separately managed accounts with specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. portfolio managers, state of the art research capabilities, and sophisticated client profiling and portfolio modeling tools," commented James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. A. Schmelter, EVP and head of wealth management. During the fourth quarter of 2003, Citizens repurchased a total of 167,200 shares of its stock at an average price of $30.77. For the year, Citizens repurchased 810,800 shares at an average price of $26.30. As of December 31, 2003, 254,600 shares remain to be purchased under the October 2001 three million share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. program and an additional three million shares are authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: for 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. under a new plan, approved in October 2003. Conference Call Announcement As previously announced, William R. Hartman, chairman, president and CEO, Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by D. Christy chris·ty n. Variant of christie. , CFO See Chief Financial Officer. , John D. Schwab, chief credit officer, Martin E. Grunst, treasurer TREASURER. An officer entrusted with the treasures or money either of a private individual, a corporation, a company, or a state. 2. It is his duty to use ordinary diligence in the performance of his office, and to account with those whose money he has. and Daniel Daniel, book of the Bible Daniel, book of the Bible. It combines "court" tales, perhaps originating from the 6th cent. B.C., and a series of apocalyptic visions arising from the time of the Maccabean emergency (167–164 B.C. E. Bekemeier, chief accounting officer will review the quarter's results in a conference call for investors and analysts beginning at 10:00am EST EST electroshock therapy. EST abbr. electroshock therapy on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , January 16, 2004. A live audio web cast is available at http://viavid.net/dce.aspx?sid=000018D6. To participate in the conference call, please call the number below approximately 10 minutes prior to the scheduled conference time: US/Canada Dial-In Number: (800) 374-2419 International Dial-In Number: (706) 634-1073 Conference ID # 4605043 Conference Name: "Citizens Banking Corporation 4th Quarter Earnings" R.S.V.P. is not required. A playback Playback could mean:
The process by which the corporation communicates with its investors. section at www.citizensonline.com. Corporate Profile Citizens Banking Corporation is a diversified financial The diversified financial services segment includes a range of consumer and commercially-oriented companies offering a wide variety of products and services, including various lending products (such as home equity loans and credit cards), insurance, and securities and investment services company providing a full range of commercial, consumer, mortgage banking, trust and financial planning Financial planning Evaluating the investing and financing options available to a firm. Planning includes attempting to make optimal decisions, projecting the consequences of these decisions for the firm in the form of a financial plan, and then comparing future performance against services to a broad client base. Citizens operates 176 branch, private banking, and financial center locations throughout Michigan Michigan (mĭsh`ĭgən), upper midwestern state of the United States. It consists of two peninsulas thrusting into the Great Lakes and has borders with Ohio and Indiana (S), Wisconsin (W), and the Canadian province of Ontario (N,E). , Wisconsin, Iowa, and in suburban Chicago Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. , 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. . Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement Discussions in this release that are not statements of historical fact (including statements that include terms such as "believe", "expect", and "anticipate") 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. that involve risks and uncertainties, and our actual future results could materially differ from those discussed. Factors that could cause or contribute to such differences include, but are not limited to, adverse changes in our loan portfolios (including losses due to fraud and economic factors) and the resulting credit risk-related losses and expenses, our future lending and collections experience and the potential inadequacy of our loan loss reserves, interest rate fluctuations and the effects on net interest income of changes in our interest rate risk position, other adverse changes in economic or financial market conditions, the potential inability to hedge certain risks economically ec·o·nom·i·cal adj. 1. Prudent and thrifty in management; not wasteful or extravagant. See Synonyms at sparing. 2. Intended to save money, as by efficient operation or elimination of unnecessary features; economic: , adverse changes in competition and pricing environments, our potential failure to maintain or improve loan quality levels and origination volume, our potential inability to continue to attract core deposits, the potential lack of market acceptance of our new wealth management capabilities and our products and services, adverse changes in our relationship with major customers, unanticipated technological changes that require major capital expenditures, adverse changes in applicable laws and regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. , unanticipated environmental liabilities or costs, our potential inability to complete our restructuring, the effects of terrorist attacks and potential attacks, our success in managing the risks involved in the foregoing, and other risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission. Other factors not currently anticipated by management may also materially and adversely affect our results of operations. We do not undertake, and expressly disclaim dis·claim v. dis·claimed, dis·claim·ing, dis·claims v.tr. 1. To deny or renounce any claim to or connection with; disown. 2. To deny the validity of; repudiate. 3. any obligation, to update or alter our forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law. (Financial highlights follow) Visit our Web site at http://www.CitizensOnline.com
Consolidated Balance Sheets (Unaudited)
Citizens Banking Corporation and Subsidiaries
Dec. 31, Dec. 31,
(in thousands) 2003 2002(1)
----------------------------------------------------------------------
Assets
Cash and due from banks $182,545 $171,864
Money market investments:
Federal funds sold --- 69,000
Interest-bearing deposits with banks 2,223 2,332
----------- -----------
Total money market investments 2,223 71,332
Securities available-for-sale:
Taxable 1,536,145 1,021,668
Tax-exempt 429,056 435,613
----------- -----------
Total securities available-for-sale 1,965,201 1,457,281
Securities held-to-maturity (fair value of
$19,913 ) 19,857 ---
Mortgage loans held for sale 44,677 160,743
Loans 5,245,702 5,432,561
Less: Allowance for loan losses (123,545) (106,777)
----------- -----------
Net loans 5,122,157 5,325,784
Premises and equipment 112,784 117,704
Goodwill 54,785 54,785
Other intangible assets 16,932 19,862
Bank owned life insurance 80,461 78,434
Other assets 109,448 66,935
----------- -----------
Total assets $7,711,070 $7,524,724
=========== ===========
Liabilities
Noninterest-bearing deposits $882,429 $900,674
Interest-bearing deposits 4,559,838 5,036,239
----------- -----------
Total deposits 5,442,267 5,936,913
Federal funds purchased and securities sold
under agreements to repurchase 588,593 223,289
Other short-term borrowings 43,077 79,062
Other liabilities 65,112 35,678
Long-term debt 936,859 599,313
----------- -----------
Total liabilities 7,075,908 6,874,255
Shareholders' Equity
Preferred stock - no par value
Common stock - no par value 100,314 112,253
Retained earnings 512,045 495,570
Other accumulated comprehensive net income 22,803 42,646
----------- -----------
Total shareholders' equity 635,162 650,469
----------- -----------
Total liabilities and shareholders' equity $7,711,070 $7,524,724
=========== ===========
----------------------------------------------------------------------
(1) Certain amounts have been reclassified to conform with current
year presentation.
Consolidated Statements of Income (Unaudited)
Citizens Banking Corporation
and Subsidiaries Three Months Twelve Months
Ended Ended
December 31, December 31,
(in thousands, except per
share amounts) 2003 2002(1) 2003 2002(1)
----------------------------------------------------------------------
Interest Income
Interest and fees on loans $76,345 $92,900 $323,739 $385,812
Interest and dividends on
investment securities:
Taxable 15,836 14,326 61,631 55,447
Tax-exempt 5,214 5,263 20,502 21,301
Money market investments 3 69 105 824
----------- -------- ---------- ---------
Total interest income 97,398 112,558 405,977 463,384
----------- -------- ---------- ---------
Interest Expense
Deposits 17,039 28,689 83,449 127,849
Short-term borrowings 1,463 1,157 4,960 4,033
Long-term debt 8,218 6,480 31,310 29,720
----------- -------- ---------- ---------
Total interest expense 26,720 36,326 119,719 161,602
----------- -------- ---------- ---------
Net Interest Income 70,678 76,232 286,258 301,782
Provision for loan losses 8,020 16,300 62,962 120,200
----------- -------- ---------- ---------
Net interest income after
provision for loan losses 62,658 59,932 223,296 181,582
----------- -------- ---------- ---------
Noninterest Income
Service charges on deposit
accounts 8,074 6,689 29,916 26,456
Trust fees 4,615 4,696 17,527 18,956
Mortgage and other loan
income 2,079 7,020 18,046 16,845
Brokerage and investment
fees 1,705 2,482 7,720 9,502
Bankcard fees 732 783 3,042 6,142
Investment securities gains 2 12 103 ---
Gain on sale of merchant
business --- --- --- 5,400
Gain on securitized
mortgages --- --- --- 2,436
Other 4,424 5,019 18,465 16,039
----------- -------- ---------- ---------
Total noninterest income 21,631 26,701 94,819 101,776
----------- -------- ---------- ---------
Noninterest Expense
Salaries and employee
benefits 29,774 30,585 122,322 126,847
Equipment 3,989 4,888 16,087 19,869
Occupancy 5,112 4,349 18,449 17,855
Professional services 5,202 5,077 17,815 14,790
Data processing services 3,145 3,200 12,744 12,641
Postage and delivery 1,796 1,745 6,896 7,120
Advertising and public
relations 1,719 (423) 5,786 5,112
Telephone 1,314 1,176 4,793 5,279
Stationery and supplies 1,256 1,011 3,935 4,032
Bankcard expense 117 92 378 3,879
Special charge --- (405) (691) 13,402
Prepayment penalty on FHLB
advances --- --- --- 3,300
Contribution to charitable
trust --- --- --- 2,000
Other 7,022 5,831 24,474 23,257
----------- -------- ---------- ---------
Total noninterest expense 60,446 57,126 232,988 259,383
----------- -------- ---------- ---------
Income Before Income Taxes 23,843 29,507 85,127 23,975
Income tax provision
(benefit) 5,769 7,982 19,176 (1,063)
----------- -------- ---------- ---------
Net Income $18,074 $21,525 $65,951 $25,038
=========== ======== ========== =========
Net Income Per Share:
Basic $0.42 $0.49 $1.52 $0.56
Diluted 0.41 0.48 1.51 0.56
Average Shares Outstanding:
Basic 43,237 44,178 43,304 44,657
Diluted 43,714 44,425 43,609 45,077
----------------------------------------------------------------------
(1) Certain amounts have been reclassified to conform with current
year presentation.
----------------------------------------------------------------------
Selected Quarterly Information
Citizens Banking Corporation and Subsidiaries
4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
2003 2003 2003 2003 2002
----------------------------------------------------------------------
Summary of Operations
(thousands)
Interest
income $97,398 $99,687 $104,683 $104,209 $112,558
Interest
expense 26,720 28,533 31,763 32,703 36,326
Net interest
income 70,678 71,154 72,920 71,506 76,232
Provision for
loan losses 8,020 10,300 25,650 18,992 16,300
Net interest income
after provision
for loan losses 62,658 60,854 47,270 52,514 59,932
Noninterest
income 21,631 25,054 24,847 23,287 26,701
Noninterest
expense 60,446 59,600 56,361 56,581 57,126
Income tax provision 5,769 6,703 2,542 4,162 7,982
Net income 18,074 19,605 13,214 15,058 21,525
----------------------------------------------------------------------
At Period End (millions)
Total assets $7,711 $7,787 $7,789 $7,768 $7,525
Total earning
assets 7,278 7,356 7,334 7,285 7,122
Total loans 5,246 5,226 5,287 5,303 5,433
Total
deposits 5,442 5,482 5,660 5,812 5,937
Total shareholders'
equity 635 634 639 640 650
----------------------------------------------------------------------
Average Balances (millions)
Total assets $7,697 $7,812 $7,809 $7,454 $7,564
Total earning
assets 7,279 7,378 7,387 7,043 7,141
Total loans 5,220 5,183 5,253 5,343 5,470
Total
deposits 5,481 5,610 5,723 5,853 5,922
Total shareholders'
equity 626 620 639 643 654
Shareholders' equity/
assets 8.13% 7.94% 8.18% 8.63% 8.65%
----------------------------------------------------------------------
Credit Quality Statistics
(thousands)
Nonaccrual
loans $68,744 $83,278 $87,928 $84,107 $86,717
Loans 90 or more days
past due and still
accruing 345 601 607 990 860
Restructured
loans --- --- --- --- ---
-------- -------- -------- -------- --------
Total
nonperforming
loans 69,089 83,879 88,535 85,097 87,577
Other repossessed
assets acquired
(ORAA) 7,943 7,350 8,044 8,226 8,094
-------- -------- -------- -------- --------
Total
nonperforming
assets $77,032 $91,229 $96,579 $93,323 $95,671
======== ======== ======== ======== ========
Allowance for
loan losses $123,545 $123,265 $123,302 $109,695 $106,777
Allowance for loan
losses ratio 2.36% 2.36% 2.33% 2.07% 1.97%
Allowance for loan
losses as a percent
of nonperforming
assets 160.38 135.12 127.67 117.54 111.61
Allowance for loan
losses as a percent
of nonperforming
loans 178.82 146.96 139.27 128.91 121.92
Nonperforming assets
as a percent of loans
plus ORAA 1.47 1.74 1.82 1.76 1.76
Nonperforming assets
as a percent of
total assets 1.00 1.17 1.24 1.20 1.27
Net loans charged off
as a percent of
average loans
(annualized) 0.59 0.80 0.92 1.20 0.80
Net loans charged
off (000) $7,740 $10,337 $12,043 $16,074 $10,991
----------------------------------------------------------------------
Per Common Share Data
Net Income
(loss):
Basic $0.42 $0.45 $0.30 $0.35 $0.49
Diluted 0.41 0.45 0.30 0.34 0.48
Dividends 0.285 0.285 0.285 0.285 0.285
Market Value:
High $34.26 $28.01 $28.17 $26.05 $26.46
Low 26.41 24.77 21.72 23.58 21.25
Close 32.72 26.41 27.01 23.62 24.78
Book value 14.69 14.67 14.77 14.79 14.88
Shares outstanding,
end of period (000) 43,242 43,220 43,260 43,299 43,702
----------------------------------------------------------------------
Performance Ratios
(annualized)
Net interest margin
(FTE) 4.07% 4.06% 4.17% 4.33% 4.49%
Return on
average
assets 0.93 1.00 0.68 0.82 1.13
Return on average
shareholders'
equity 11.45 12.55 8.29 9.50 13.06
Efficiency
ratio 63.16 59.90 55.74 57.58 53.61
----------------------------------------------------------------------
Financial Summary and Comparison For the twelve
months ended
Citizens Banking Corporation and December 31,
Subsidiaries
2003 2002 % Change
----------------------------------------------------------------------
Summary of Operations (thousands)
Interest income (1) $405,977 $463,384 (12.4)%
Interest expense 119,719 161,602 (25.9)
Net interest income 286,258 301,782 (5.1)
Provision for loan losses 62,962 120,200 (47.6)
Net interest income after provision for
loan losses 223,296 181,582 23.0
Noninterest income (1) 94,819 101,776 (6.8)
Noninterest expense (1) 232,988 259,383 (10.2)
Income tax provision (benefit) 19,176 (1,063) (1,904.0)
Net income 65,951 25,038 163.4
----------------------------------------------------------------------
At Period End (millions)
Total assets $7,711 $7,525 2.5 %
Total earning assets 7,278 7,122 2.2
Total loans 5,246 5,433 (3.4)
Total deposits 5,442 5,937 (8.3)
Total shareholders' equity 635 650 (2.3)
----------------------------------------------------------------------
Average Balances (millions)
Total assets $7,694 $7,569 1.7 %
Total earning assets 7,273 7,161 1.6
Total loans 5,249 5,531 (5.1)
Total deposits 5,666 5,924 (4.4)
Total shareholders' equity 632 692 (8.7)
Shareholders' equity / assets 8.21 % 9.14 % (10.2)
----------------------------------------------------------------------
Per Common Share Data
Net Income:
Basic $1.52 $0.56 171.4 %
Diluted 1.51 0.56 169.6
Dividends 1.140 1.130 0.9
Market Value:
High $34.26 $33.88 1.1
Low 21.72 21.25 2.2
Close 32.72 24.78 32.0
Book value 14.69 14.88 (1.2)
Tangible book value 13.03 13.18 (1.1)
Shares outstanding, end of period (000) 43,242 43,702 (1.1)
----------------------------------------------------------------------
Performance Ratios (annualized)
Net interest margin (FTE) (2) 4.15 % 4.45 % (6.7)%
Return on average assets 0.86 0.33 160.6
Return on average shareholders' equity 10.44 3.62 188.4
Net loans charged off as a percent of
average loans 0.88 1.64 (46.3)
----------------------------------------------------------------------
(1) Amounts for 2002 include other charges of $701,000 in interest
income, $1,587,000 in noninterest income, $7,068,000 in
noninterest expense and a special charge of $13,402,000 in
noninterest expense. Noninterest income for 2002 also includes
gains on securitized mortgages of $2,436,000 and gain on sale of
merchant business of $5,400,000.
(2) Net interest margin is presented on an annual basis and includes
taxable equivalent adjustments to interest income of $13,508,000
and $14,470,000 for the twelve months ended December 31, 2003 and
2002, respectively, based on a tax rate of 35%.
Noninterest Income and Noninterest Expense(Unaudited)
Citizens Banking Corporation and Subsidiaries
Quarter Ended
---------------------------------------------
Dec 31 Sept 30 June 30 Mar 31 Dec 31
(in thousands) 2003 2003 2003 2003 2002
----------------------------------------------------------------------
NONINTEREST INCOME:
Service charges on
deposit accounts $8,074 $7,703 $7,549 $6,590 $6,689
Trust fees 4,615 4,368 4,324 4,220 4,696
Mortgage and other loan
income 2,079 5,404 5,409 5,154 7,020
Brokerage and investment
fees 1,705 2,333 1,914 1,768 2,482
Bankcard fees 732 761 814 735 783
Investment securities
gains 2 42 11 48 12
Other income 4,424 4,443 4,826 4,772 5,019
-------- -------- -------- -------- --------
TOTAL NONINTEREST INCOME $21,631 $25,054 $24,847 $23,287 $26,701
======== ======== ======== ======== ========
NONINTEREST EXPENSE:
Salaries and employee
benefits $29,774 $31,036 $31,400 $30,112 $30,585
Equipment 3,989 4,060 3,869 4,169 4,888
Occupancy 5,112 4,328 4,314 4,695 4,349
Professional services 5,202 4,946 3,959 3,708 5,077
Data processing services 3,145 3,225 3,058 3,316 3,200
Postage and delivery 1,796 1,739 1,683 1,678 1,745
Advertising and public
relations 1,719 1,395 623 2,049 (423)
Telephone 1,314 1,169 1,135 1,175 1,176
Stationery and supplies 1,256 911 873 895 1,011
Bankcard expense 117 79 91 91 92
Special charge --- (370) (221) (100) (405)
Other expense 7,022 7,082 5,577 4,793 5,831
-------- -------- -------- -------- --------
TOTAL NONINTEREST EXPENSE $60,446 $59,600 $56,361 $56,581 $57,126
======== ======== ======== ======== ========
Average Balances, Yields and Rates
Three Months Ended
--------------------------------------------------------
12/31/03 09/30/03 12/31/02
--------------------------------------------------------
Average Average Average Average Average Average
(in thousands) Balance Rate(1) Balance Rate(1) Balance Rate(1)
----------------------------------------------------------------------
Earning Assets
Money market
investments $2,539 0.51% $3,927 0.30% $20,977 1.29%
Investment
securities(2):
Taxable 1,542,775 4.11 1,526,583 3.73 998,895 5.74
Tax-exempt 418,438 7.67 401,302 7.76 411,981 7.86
Mortgage loans
held for sale 64,950 5.47 234,793 5.26 175,952 6.56
Loans:
Commercial 2,982,849 5.46 3,049,878 5.61 3,307,039 6.08
Real estate 493,989 5.56 481,337 6.34 636,805 6.77
Direct
consumer 996,486 5.96 937,133 6.27 855,908 7.35
Indirect
consumer 746,443 6.99 714,302 7.24 669,897 7.97
----------- ----------- -----------
Total earning
assets 7,248,469 5.53 7,349,255 5.61 7,077,454 6.53
Nonearning
Assets
Cash and due
from banks 165,477 183,214 181,858
Investment
security fair
value
adjustment 30,907 28,909 64,028
Other
nonearning
assets 377,429 375,185 347,451
Allowance for
loan losses (125,420) (124,964) (106,720)
----------- ----------- -----------
Total
assets $7,696,862 $7,811,599 $7,564,071
=========== =========== ===========
Interest-Bearing
Liabilities
Deposits:
Interest-
bearing
demand $1,340,511 0.73 $1,334,765 0.75 $1,253,900 1.46
Savings
deposits 1,262,141 0.47 1,332,519 0.55 1,360,296 0.99
Time deposits 1,976,708 2.63 2,054,257 2.84 2,422,243 3.39
Short-term
borrowings 576,496 1.01 561,427 1.05 309,203 1.48
Long-term debt 938,005 3.48 937,941 3.51 610,717 4.21
----------- ----------- -----------
Total interest-
bearing
liabilities 6,093,861 1.74 6,220,909 1.84 5,956,359 2.42
Noninterest-Bearing Liabilities
and Shareholders' Equity
Noninterest-
bearing demand 901,383 888,440 885,903
Other
liabilities 75,624 82,150 67,674
Shareholders'
equity 625,994 620,100 654,135
----------- ----------- -----------
Total
liabilities
and
shareholders'
equity $7,696,862 $7,811,599 $7,564,071
=========== =========== ===========
Interest Spread 3.79% 3.77% 4.11%
Contribution of
noninterest bearing
sources of funds 0.28 0.29 0.38
===== ===== =====
Net Interest Income as a
Percent of Earning
Assets 4.07% 4.06% 4.49%
----------------------------------------------------------------------
Twelve Months Ended
-------------------------------------
12/31/03 12/31/02
-------------------------------------
Average Average Average Average
(in thousands) Balance Rate(1) Balance Rate(1)
----------------------------------------------------------------------
Earning Assets
Money market
investments $11,214 0.94% $50,599 1.61%
Investment
securities(2):
Taxable 1,405,549 4.38 963,574 5.75
Tax-exempt 405,412 7.78 416,563 7.87
Mortgage loans
held for sale 155,407 5.54 146,434 6.27
Loans:
Commercial 3,112,311 5.66 3,343,273 6.31
Real estate 527,565 6.12 686,250 7.24
Direct consumer 920,696 6.39 838,067 7.73
Indirect
consumer 688,350 7.32 663,200 8.18
----------- -----------
Total earning
assets 7,226,504 5.80 7,107,960 6.72
Nonearning
Assets
Cash and due
from banks 170,865 180,993
Investment security fair
value adjustment 46,383 52,636
Other
nonearning
assets 371,105 315,344
Allowance for
loan losses (120,926) (87,592)
----------- -----------
Total assets $7,693,931 $7,569,341
=========== ===========
Interest-
Bearing
Liabilities
Deposits:
Interest-
bearing demand $1,319,858 0.89 $1,147,960 1.57
Savings
deposits 1,329,648 0.67 1,363,528 1.14
Time deposits 2,138,088 2.94 2,543,255 3.71
Short-term
borrowings 458,673 1.08 251,315 1.60
Long-term debt 861,704 3.63 620,913 4.79
----------- -----------
Total interest-
bearing
liabilities 6,107,971 1.96 5,926,971 2.73
Noninterest-Bearing Liabilities
and Shareholders' Equity
Noninterest-
bearing demand 877,939 869,699
Other
liabilities 75,961 80,837
Shareholders'
equity 632,060 691,834
----------- -----------
Total liabilities and
shareholders' equity $7,693,931 $7,569,341
=========== ===========
Interest Spread 3.84% 3.99%
Contribution of
noninterest bearing
sources of funds 0.31 0.46
===== =====
Net Interest Income as a
Percent of Earning Assets 4.15% 4.45%
----------------------------------------------------------------------
(1) Average rates are presented on an annual basis and include taxable
equivalent adjustments to interest income.
(2) For presentation in this table, average balances and the
corresponding average rates for investment securities are based
upon historical cost, adjusted for amortization of premiums and
accretion of discounts.
Nonperforming Assets
Citizens Banking Corporation and Subsidiaries
Quarter Ended
---------------------------------------------------
Dec 31 Sept 30 June 30 Mar 31 Dec 31
(in thousands) 2003 2003 2003 2003 2002
--------------------------------------------------------------------
Commercial(1)
Commercial $37,171 $51,158 $52,760 $49,275 50,231
Commercial
real estate 16,385 17,379 19,568 20,433 19,301
Small business 1,603 1,648 1,466 1,459 813
--------- --------- --------- --------- ---------
Total
commercial 55,159 70,185 73,794 71,167 70,345
Consumer:
Direct 3,177 3,291 3,208 3,416 3,704
Indirect 1,247 1,625 1,094 1,646 1,803
Mortgage 9,161 8,177 9,832 7,878 10,865
Loans 90 days or
more past due and
still accruing 345 601 607 990 860
Restructured
loans --- --- --- --- ---
--------- --------- --------- --------- ---------
Total
Nonperforming
Loans 69,089 83,879 88,535 85,097 87,577
Other Repossessed
Assets Acquired 7,943 7,350 8,044 8,226 8,094
--------- --------- --------- --------- ---------
Total
Nonperforming
Assets $77,032 $91,229 $96,579 $93,323 $95,671
========= ========= ========= ========= =========
--------------------------------------------------------------------
(1) Changes in commercial nonperforming
assets for the quarter (in millions):
Inflows $17.8 $21.1 $36.3 $22.7 $27.6
Outflows (32.8) (24.7) (33.7) (21.9) (34.7)
--------- --------- --------- --------- ---------
Net change $(15.0) $(3.6) $2.6 $0.8 $(7.1)
========= ========= ========= ========= =========
----------------------------------------------------------------------
Summary of Loan Loss Experience
Citizens Banking Corporation and Subsidiaries
Quarter Ended
---------------------------------------------------
Dec 31 Sept 30 June 30 Mar 31 Dec 31
(in thousands) 2003 2003 2003 2003 2002
--------------------------------------------------------------------
Allowance for loan
losses -
beginning of
period $125,955 $125,992 $112,385 $109,467 $104,158
Less: Reserve for
loan commitments 2,690 2,690 2,690 2,690 2,690
--------- --------- --------- --------- ---------
Restated Allowance
for loan losses -
beginning of
period 123,265 123,302 109,695 106,777 101,468
Provision for
loan losses 8,020 10,300 25,650 18,992 16,300
Charge-offs:
Commercial 7,323 9,539 7,577 14,133 10,058
Commercial
real estate 2,276 1,531 4,321 955 159
Small business 551 348 273 264 159
--------- --------- --------- --------- ---------
Total
commercial 10,150 11,418 12,171 15,352 10,376
Real estate
mortgage 320 213 76 625 1,745
Consumer -
Direct 1,388 1,628 1,790 1,748 1,474
Consumer -
Indirect 2,580 1,941 2,152 2,511 2,582
--------- --------- --------- --------- ---------
Total charge-
offs 14,438 15,200 16,189 20,236 16,177
--------- --------- --------- --------- ---------
Recoveries:
Commercial 4,452 2,882 2,115 2,032 3,862
Commercial
real estate 927 595 623 465 45
Small business 165 139 93 362 86
--------- --------- --------- --------- ---------
Total
commercial 5,544 3,616 2,831 2,859 3,993
Real estate
mortgage --- 27 8 1 ---
Consumer -
Direct 461 504 479 439 400
Consumer -
Indirect 693 716 828 863 793
--------- --------- --------- --------- ---------
Total
recoveries 6,698 4,863 4,146 4,162 5,186
--------- --------- --------- --------- ---------
Net charge-offs 7,740 10,337 12,043 16,074 10,991
--------- --------- --------- --------- ---------
Restated Allowance
for loan losses -
end of period $123,545 $123,265 $123,302 $109,695 $106,777
========= ========= ========= ========= =========
Reserve for loan
commitments - end
of period $2,690 $2,690 $2,690 $2,690 $2,690
========= ========= ========= ========= =========
-------------------------------------------------
For the Quarter Ended 12/31/03
-------------------------------------------------
Real Consumer- Consumer-
Commercial estate Direct Indirect Total
-------------------------------------------------
Charge-offs:
Michigan $4,455 $125 $1,031 $2,580 $8,191
Wisconsin 3,113 188 273 --- 3,574
Iowa 1,821 7 58 --- 1,886
Illinois 761 --- 26 --- 787
-------- ------- ------- ------- --------
Total charge-offs 10,150 320 1,388 2,580 14,438
-------- ------- ------- ------- --------
Recoveries:
Michigan 3,859 --- 276 689 4,824
Wisconsin 1,445 --- 138 --- 1,583
Iowa 120 --- 41 --- 161
Illinois 120 --- 6 4 130
-------- ------- ------- ------- --------
Total recoveries 5,544 - 461 693 6,698
-------- ------- ------- ------- --------
Net charge-offs $4,606 $320 $927 $1,887 $7,740
======== ======= ======= ======= ========
-------------------------------------------------
For the Year Ended 12/31/03
-------------------------------------------------
Real Consumer- Consumer-
Commercial estate Direct Indirect Total
-------------------------------------------------
Charge-offs:
Michigan $31,322 $975 $4,588 $9,184 $46,069
Wisconsin 13,744 118 1,554 --- 15,416
Iowa 2,618 141 331 --- 3,090
Illinois 1,407 --- 81 --- 1,488
-------- ------- ------- ------- --------
Total charge-offs 49,091 1,234 6,554 9,184 66,063
-------- ------- ------- ------- --------
Recoveries:
Michigan 9,541 --- 1,298 3,079 13,918
Wisconsin 4,359 22 434 --- 4,815
Iowa 195 14 115 --- 324
Illinois 755 --- 36 21 812
-------- ------- ------- ------- --------
Total recoveries 14,850 36 1,883 3,100 19,869
-------- ------- ------- ------- --------
Net charge-offs $34,241 $1,198 $4,671 $6,084 $46,194
======== ======= ======= ======= ========
|
|
||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion