First Charter Announces First Quarter Results.Business Editors CHARLOTTE, N.C.--(BUSINESS WIRE)--April 13, 2004 First Charter Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : FCTR FCTR First Charter Corporation (stock symbol) FCTR Federal Cash Transactions Report FCTR Forced Call Termination Rate ) today reported first quarter 2004 earnings of $9.2 million, or $0.31 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to earnings of $9.9 million or $0.33 per diluted share for the same period in 2003. However, earnings for the first quarter of 2003 included a $2.2 million ($1.6 million, or $0.05 diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of , after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. ) gain recognized on the sale of the Corporation's credit card portfolio. The Corporation's primary noninterest income lines of business continue to generate strong revenue growth with financial management income up 160 percent, brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. services income up 100 percent and insurance services income up 24 percent. In addition, the Corporation began to realize the benefits from the refinancing Refinancing An extension and/or increase in amount of existing debt. of fixed term advances during 2003 and certain asset-liability management transactions entered into during the first quarter of 2004 as interest expense decreased 21 percent. "I am pleased to report that First Charter begins 2004 with very good news," said Lawrence Lawrence. 1 City (1990 pop. 26,763), Marion co., central Ind., a residential suburb of Indianapolis, on the West Fork of the White River. It has light manufacturing. 2 City (1990 pop. 65,608), seat of Douglas co., NE Kans. M. Kimbrough Kimbrough may refer to: People
Furthermore, the recent announcement of the election of Bob James Bob James can refer to different people:
In organizational development, succession planning is the process of identifying and preparing suitable employees through mentoring, training and job rotation, to replace key players — such as the chief executive officer (CEO) — and a key factor in the long term health of First Charter." Highlights First Quarter 2004 compared to First Quarter 2003 -- Net interest income increased $3.8 million or 14 percent. -- Provision for loan losses increased $0.9 million or 46 percent. -- Service charges increased $0.5 million or 9 percent. -- Financial management income increased $0.9 million or 160 percent. -- Brokerage services income increased $0.5 million or 100 percent. -- Insurance services income increased $0.6 million or 24 percent. -- Noninterest expense increased $2.3 million or 9 percent. -- $6.4 million in nonaccruing and accruing higher risk mortgage loans were sold. First Quarter 2004 compared to Fourth Quarter 2003 -- Gross loans and loans held for sale increased $40.1 million or 2 percent. -- Average 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 increased $92.6 million or 2 percent. -- Transaction based deposits increased $75.9 million or 6 percent. -- 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 $3.7 million or 17 percent. -- Net interest margin increased 9 basis points to 3.19 percent. -- Provision for loan losses decreased $0.6 million or 16 percent. -- Insurance services income increased $0.6 million or 26 percent. -- Noninterest expense decreased $13.1 million or 32 percent. -- $6.4 million in nonaccruing and accruing higher risk mortgage loans were sold.
Financial Highlights
For the Three Months
Ended March 31 Increase (Decrease)
------------------ -----------------------
Earnings 2004 2003 Amount Percentage
(Dollars in thousands,
except per share data)
----------------------------------- ------- ------ ------
Total revenues $45,038 $42,122 $2,916 6.92%
Net income 9,240 9,946 (706) (7.10)
Diluted earnings per share 0.31 0.33 (0.02) (6.60)
Return on average assets 0.87% 1.06%
Return on average equity 11.91 12.06
Efficiency-taxable
equivalent ratio (1) 62.60 62.66
(1) - Noninterest expense divided by the sum of taxable equivalent
net interest income plus noninterest income less gain on sale
of securities.
March 31 Dec. 31 Increase (Decrease)
-------------------- ----------------------
2004 2003 Amount Percentage
Balance Sheet
(Dollars in thousands)
--------------------------------- ---------- -------- ---------
Loans held for sale $ 17,969 $ 5,137 $ 12,832 249.77%
Loans, net 2,254,130 2,227,030 27,100 1.22
Investments 1,622,967 1,601,900 21,067 1.32
Total assets 4,247,861 4,206,693 41,168 0.98
Demand, savings and
money market deposits 1,313,661 1,237,726 75,935 6.14
Total deposits 2,507,442 2,427,897 79,545 3.28
Other borrowings 1,377,374 1,432,200 (54,826) (3.83)
Shareholders' equity 308,737 299,439 9,298 3.11
March 31 March 31 Increase (Decrease)
-------------------- ----------------------
2004 2003 Amount Percentage
Average Balances
(Dollars in thousands)
--------------------------------- ----------- ---------- -----------
Loans held for sale $ 1,812 $ 9,658 $ (7,846) (81.24)%
Loans, net 2,271,763 2,102,568 169,195 8.05
Investments 1,590,083 1,295,982 294,101 22.69
Total assets 4,248,389 3,814,209 434,180 11.38
Total deposits 2,436,673 2,379,454 57,219 2.40
Other borrowings 1,430,127 1,050,637 379,491 36.12
Shareholders' equity 311,988 334,431 (22,442) (6.71)
Net Interest Income/Margin Net interest income increased $3.8 million, or 14 percent, to $30.4 million compared to the first quarter of 2003. The increase was primarily due to a $3.9 million decrease in interest expense due to (a) a shift in funding sources from higher-cost retail certificates of deposit to lower-cost transaction based accounts, (b) the benefits from the refinancing of $50 million and $81 million of fixed-term advances in the second quarter and fourth quarter of 2003, respectively, and (c) the benefits from certain asset-liability management transactions entered into during the first quarter of 2004. The increase in net interest income was partially offset by a $0.3 million decrease in interest income due mainly to lower yields on earning assets resulting from the continued effects of the declining interest rate environment. The net interest margin increased to 3.19 percent in the first quarter of 2004 from 3.15 percent for the same period in 2003 as lower rates paid on interest bearing liabilities exceeded the impact of lower yields earned on interest bearing assets. Noninterest Income Noninterest income decreased $0.9 million to $14.7 million compared to the first quarter of 2003. However, the Corporation's primary noninterest income lines of business exceeded the first quarter of 2003 by $2.6 million or 24 percent. The increase was primarily due to the acquisitions of a third party benefits administrator in the third quarter of 2003 and two insurance agencies in the third and fourth quarter of 2003. In addition, the increase was driven by continued growth in brokerage services income and service charges. This increase was offset by a $3.5 million decrease in other components of noninterest income including gains on the sale of the Corporation's credit card portfolio, trading income, gains on sale of securities, losses on equity investments and gains on the sale of bank property. Noninterest Expense Noninterest expense increased $2.3 million to $28.3 million compared to the first quarter of 2003. Noninterest expense was impacted by a $1.3 million increase in salaries and employee benefits due to additional personnel, including the acquisition of a third party benefits administrator and two insurance agencies, increased incentive compensation accruals Accruals Accounts on a balance sheet that represent liabilities and non-cash-based assets used in accrual-based accounting. These accounts include, among many others, accounts payable, accounts receivable, goodwill, future tax liability and future interest expense. and lower deferred 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 loan costs. In addition, noninterest expense was affected by a $0.9 million increase in professional fees including technology infrastructure administration, fees associated with the sale of $6.4 million of nonaccruing and accruing higher risk mortgage loans, consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" to ensure compliance with Section 404 of the Sarbanes-Oxley Act See SOX. and fees related to the collection efforts on certain residential rental RENTAL. A roll or list of the rents of an estate containing the description of the lands let, the names of the tenants, and other particulars connected with such estate. This is the same as rent roll, from which it is said to be corrupted. property loans. Efficiency Ratio The efficiency ratio decreased slightly to 62.6 percent compared to 62.7 percent for the first quarter of 2003. The calculation of the efficiency ratio excludes gains on sale of securities of $0.3 million and $1.2 million for the three months ended March 31, 2004 and 2003, respectively. Income Tax Expense Total income tax expense for the first quarter of 2004 was $4.5 million for an effective tax rate of 32.7 percent, compared to $4.1 million for an effective tax rate of 29.2 percent for the first quarter of 2003. The increase in the effective tax rate for 2004 was due to an increase in projected taxable income Under the federal tax law, gross income reduced by adjustments and allowable deductions. It is the income against which tax rates are applied to compute an individual or entity's tax liability. The essence of taxable income is the accrual of some gain, profit, or benefit to a taxpayer. relative to nontaxable adj. 1. Not subject to taxation; - of goods imported into a country or sold at retail outlets; as, most laws imposing sales taxes make food nontaxable s>. Opposite of taxable nt>. Adj. 1. adjustments. Loans Held for Sale Loans held for sale consist primarily of 15 and 30 year residential mortgage loans which the Corporation intends to sell as whole loans or securitize Securitize The practice of a company selling accounts receivables or other debts owed to it. The third party that buys the debt assumes ownership of it and the responsibility for collecting the debts, and keeps the repayments when made. to improve its liquidity position. Loans held for sale increased to $18.0 million at March 31, 2004 as compared to $5.1 million at December December: see month. 31, 2003. During the first quarter of 2004, $15.9 million of mortgage loans were originated and classified as held for sale. Loans Gross loans increased $27.3 million to $2.28 billion at March 31, 2004 as compared to $2.25 billion at December 31, 2003. The growth in loans was primarily due to a $25.0 million increase in commercial real estate loans, a $21.4 million increase in home equity loans and a $7.8 million increase in primarily adjustable rate mortgage This article is about the US mortgage type. For an international perspective, see Variable rate mortgage. An adjustable rate mortgage (ARM) is a mortgage loan where the interest rate on the note is periodically adjusted based on an index. loans. These increases were partially offset by a $12.8 million and a $12.1 million decrease in consumer and construction loans, respectively. In addition, $6.4 million of nonaccruing and accruing higher risk mortgage loans were sold to investors during the first quarter of 2004 and $15.9 million of primarily fixed rate mortgage loans originated in the first quarter of 2004 were classified as held for sale. Securities The securities available for sale portfolio increased to $1.62 billion at March 31, 2004 as compared to $1.60 billion at December 31, 2003. The Corporation's strategy is to maintain the portfolio at its current level. This approach will provide the Corporation the opportunity to reinvest re·in·vest tr.v. re·in·vest·ed, re·in·vest·ing, re·in·vests To invest (capital or earnings) again, especially to invest (income from securities or funds) in additional shares. the cash flows from the portfolio in higher rate investments in a rising interest rate environment. Deposits The Corporation's CHecking Account Marketing Program (CHAMP) continues to attract new accounts and generate deposits. During the first quarter of 2004, 10,258 new checking accounts were opened. In addition, during the first quarter of 2004 the Corporation introduced a new money market account, the Performance Plus Account. This product has been very successful with total balances at March 31, 2004 of $111.5 million. The emphasis of these programs is to develop new customer relationships to generate additional fee income opportunities and to shift our funding mix towards lower-cost funding sources. Total deposits increased $79.5 million, or 3 percent, to $2.51 billion at March 31, 2004 compared to $2.43 billion at December 31, 2003. The increase in deposits was due to a $36.0 million increase in money market accounts, a $40.0 million increase in low-cost interest checking, savings and noninterest bearing deposits and a $30.0 million increase in brokered certificates of deposit. These increases were partially offset by a $26.4 million decrease in higher-cost retail certificates of deposit. Other Borrowings Other borrowings decreased to $1.38 billion at March 31, 2004 compared to $1.43 billion at December 31, 2003. Higher levels of deposits allowed the Corporation to reduce its dependency dependency In international relations, a weak state dominated by or under the jurisdiction of a more powerful state but not formally annexed by it. Examples include American Samoa (U.S.) and Greenland (Denmark). on other borrowings. Interest Rate Swaps Interest Rate Swap A deal between banks or companies where borrowers switch floating-rate loans for fixed rate loans in another country. These can be either the same or different currencies. In the first quarter of 2004, the Corporation entered into a series of interest rate swap agreements. The interest rate swap agreements currently allow the Corporation to swap higher fixed rate interest payments on long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. FHLB FHLB Federal Home Loan Bank advances for lower variable rate payments. In the current period, the interest rate swaps resulted in the Corporation receiving interest at an average fixed rate of 5.15 percent and paying interest at an average variable rate of 3.26 percent, for an average period of 5.1 years on a notional amount The notional amount (or notional principal amount or notional value) on a financial instrument is the nominal or face amount that is used to calculate payments made on that instrument. This amount generally does not change hands and is thus referred to as notional. of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $142 million. As a result of swapping Replacing one segment of a program in memory with another and restoring it back to the original when required. In virtual memory systems, it is called "paging." swapping - swap $142 million of fixed rate debt payments for variable rate payments, the Corporation's balance sheet would become liability sensitive. Therefore, as part of the Corporation's asset/liability management Asset/Liability Management A technique companies employ in coordinating the management of assets and liabilities so that an adequate return may be earned. Also known as "surplus management. strategy of preserving the asset sensitive nature of the Corporation's balance sheet, the Corporation replaced approximately $165 million of existing FHLB floating rate overnight borrowings with fixed rate FHLB advances with maturities of one to three years. Combined these transactions are expected to reduce interest expense approximately $1.1 million for 2004. The Corporation expects to enter into additional interest rate swap transactions during 2004 to the extent business conditions warrant. Shareholders' Equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. Shareholders' equity at March 31, 2004 increased to $308.7 million, representing 7.27 percent of period-end assets compared to $299.4 million or 7.12 percent of period-end assets at December 31, 2003. The after-tax unrealized gain Unrealized Gain A profit that results from holding on to an asset rather than cashing it in and using the funds. Notes: Let's say you own a stock that has doubled, but you haven't sold it yet. This is said to be an unrealized gain. on available for sale securities was $11.3 million at March 31, 2004 compared to $6.2 million at December 31, 2003. The change was due to a decrease in rates across the yield curve. At March 31, 2004, the book value per share was $10.38. Based on the $21.14 closing price of First Charter Corporation common stock at March 31, 2004, the Corporation had a market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. of $628.9 million. Provision for Loan Losses The provision for loan losses increased to $3.0 million for the three months ended March 31, 2004 compared to $2.1 million for the same year ago period. The increase was primarily due to the impact of the June June: see month. 2003 problem loan sale on the historical loss ratios and allocation The apportionment or designation of an item for a specific purpose or to a particular place. In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as factors used in the allowance model. Net Charge-Offs Net charge-offs for the three months ended March 31, 2004 amounted to $2.3 million, or 0.41 percent of average loans, compared to $2.2 million, or 0.43 percent of average loans for the same 2003 period. Approximately $0.9 million of the first quarter 2004 charge-offs related to certain residential rental property loans identified in the second quarter of 2003. At March 31, 2004, there were 126 of these loans remaining with a balance of $8.9 million and an allocated allowance of $2.0 million. Nonperforming Assets Nonaccrual loans at March 31, 2004 decreased to $11.8 million compared to $14.9 million at December 31, 2003. The decrease was primarily due to the sale of $2.1 million of nonaccrual mortgage loans. OREO decreased to $6.2 million at March 31, 2004 from $6.8 million at December 31, 2003. Asset Quality Ratios As a result of the Corporation's continued focus on asset quality and the initiatives taken in 2003 and in the first quarter of 2004, our asset quality ratios have improved significantly as evidenced in the following table.
Asset Quality (1)
March Dec. Sept. June March
31 31 30 30 31
2004 2003 2003 2003 2003
------ ------ ------ ------ ------
Past Due Ratio
-------------------------
Past due loans over 30
days as a percentage of loans 0.64% 1.04% 0.71% 0.67% 1.03%
Nonaccrual Loans
-------------------------
Nonaccrual loans as a
percentage of loans 0.52% 0.66% 0.64% 0.54% 1.44%
Nonperforming Assets
-------------------------
Nonperforming assets as a
percentage of loans and
other real estate owned 0.79% 0.96% 0.95% 0.87% 1.97%
Charge-offs
-------------------------
Net charge-offs as a
percentage of average
loans-annualized 0.41% 0.35% 0.40% 0.39% 0.43%
Allowance for Loan Losses
-------------------------
Allowance for loan losses
as a percentage of loans 1.13% 1.14% 1.14% 1.15% 1.28%
Allowance for loan losses
as a percentage of
nonaccrual loans 217% 172% 179% 212% 88%
(1) Excludes loans held for sale.
Allowance for Loan Losses The allowance for loan losses as a percentage of total loans decreased slightly to 1.13 percent at March 31, 2004 compared to 1.14 percent at December 31, 2003. The allowance for loan losses decreased primarily due to improved asset quality trends. First Charter monitors the adequacy of the allowance for loan losses to cover inherent losses in the loan portfolio through the use of a loan loss migration model. Management believes the Corporation is adequately reserved based on its assessment of its credit risk profile. Conference Call First Charter executive management will be available via telephone conference to discuss the contents of this press release, present growth and earnings estimates for the second quarter and 2004 on Tuesday Tuesday: see week. , April 13, 2004 at 11:00 a.m. The following table outlines access information for the conference call and internet/audio replay:
US/Canada Participants International
Participants
----------------------------------------------------------------------
Live Conference Call 800-379-3953 706-679-5254
ID # 6274618 ID # 6274618
----------------------------------------------------------------------
Internet Live and Replay www.FirstCharter.com www.FirstCharter.com
"Investor Relations" "Investor Relations"
section section
SHOW # 160218 SHOW # 160218
----------------------------------------------------------------------
Audio Replay 800-642-1687 706-645-9291
ID # 6274618 ID # 6274618
Corporate Profile First Charter Corporation is a regional financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. company with assets of $4.2 billion and is the holding company for First Charter Bank. First Charter operates 54 financial centers, five insurance offices and 93 ATMs located in 17 counties throughout the piedmont Piedmont, region, Italy Piedmont (pēd`mŏnt), Ital. Piemonte, region (1991 pop. 4,302,565), 9,807 sq mi (25,400 sq km), NW Italy, bordering on France in the west and on Switzerland in the north. and western half of North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. . First Charter also operates one mortgage origination office in Virginia Virginia, state, United States Virginia, state of the south-central United States. It is bordered by the Atlantic Ocean (E), North Carolina and Tennessee (S), Kentucky and West Virginia (W), and Maryland and the District of Columbia (N and NE). . First Charter provides businesses and individuals with a broad range of financial services, including banking, 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 , funds management, investments, insurance, mortgages and a full array of employee benefit programs. Additional information about First Charter can be found by visiting www.FirstCharter.com or by calling 1-800-601-8471. First Charter's common stock is traded under the symbol "FCTR" on the NASDAQ National Market. Forward Looking Statements This news release contains forward looking statements with respect to the financial conditions and results of operations of First Charter Corporation. These forward looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward looking statements include, among others, the following possibilities: (1) projected results in connection with the implementation of our business plan and strategic initiatives are lower than expected; (2) competitive pressure among financial services companies increases significantly; (3) costs or difficulties related to the integration of acquisitions or expenses in general are greater than expected; (4) general economic conditions, in the markets in which the Corporation does business, are less favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. than expected; (5) risks inherent in making loans, including repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan risks and risks associated with 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 values, are greater than expected; (6) changes in the interest rate environment reduce interest margins and affect funding sources; (7) changes in market rates and prices may adversely affect the value of financial products; (8) legislation or 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. or changes thereto there·to adv. 1. To that, this, or it. 2. Archaic In addition to that; furthermore. thereto Adverb Formal 1. to that or it 2. adversely affect the businesses in which the Corporation is engaged; (9) 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. compliance cost increases are greater than expected; and (10) decisions to change the business mix of the Corporation. For further information and other factors which could affect the accuracy of forward looking statements, please see First Charter's reports filed with the SEC pursuant to the Securities Exchange Act of 1934 which are available at the SEC's website (www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. ) or at First Charter's website (www.FirstCharter.com). Readers are cautioned not to place undue reliance on these forward looking statements, which reflect management's judgments only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . The Corporation undertakes no obligation to publicly revise those forward looking statements to reflect events and circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or that arise after the date hereof.
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
(Dollars in thousands,except per share data)
As of/For the Three Months Ended Increase (Decrease)
----------------------------------------------------
3/31/2004 3/31/2003 Amount Percentage
----------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due from banks $ 75,040 $ 97,713 $ (22,673) (23.2)%
Federal funds sold 1,723 1,121 602 53.7
Interest earning bank
deposits 17,951 72,431 (54,480) (75.2)
Securities available
for sale 1,622,967 1,453,827 169,140 11.6
Loans held for sale 17,969 69,894 (51,925) (74.3)
Loans
Commercial Real Estate 749,355 800,593 (51,238) (6.4)
Commercial Non Real Estate 210,010 227,159 (17,149) (7.5)
Construction 346,109 216,784 129,325 59.7
Mortgage 288,505 240,115 48,390 20.2
Consumer 271,686 260,594 11,092 4.3
Home equity 414,410 332,392 82,018 24.7
------------------------------------------
Total loans 2,280,075 2,077,637 202,438 9.7
Less: Unearned income (209) (199) (10) 5.0
Allowance for loan
losses (25,736) (26,495) 759 (2.9)
------------------------------------------
Loans, net 2,254,130 2,050,943 203,187 9.9
------------------------------------------
Other assets 258,081 245,338 12,743 5.2
------------------------------------------
Total assets $4,247,861 $3,991,267 $ 256,594 6.4 %
------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits
Noninterest-bearing
deposits $ 353,133 $ 308,664 $ 44,469 14.4 %
Interestchecking and
savings 454,024 415,895 38,129 9.2
Money market deposits 506,504 451,021 55,483 12.3
Time deposits 1,193,781 1,317,349 (123,568) (9.4)
------------------------------------------
Total deposits 2,507,442 2,492,929 14,513 0.6
Other borrowings 1,377,374 1,116,223 261,151 23.4
Other liabilities 54,308 56,044 (1,736) (3.1)
------------------------------------------
Total liabilities 3,939,124 3,665,196 273,928 7.5
------------------------------------------
Total shareholders'
equity 308,737 326,071 (17,334) (5.3)
------------------------------------------
Total liabilities and
shareholders' equity $4,247,861 $3,991,267 $ 256,594 6.4 %
------------------------------------------
----------------------------------------------------------------------
SELECTED AVERAGE BALANCES
Loans and loans held
for sale $2,273,575 $2,112,226 $ 161,349 7.6 %
Securities 1,590,083 1,295,982 294,101 22.7
Interest earning
assets 3,884,954 3,474,071 410,883 11.8
Assets 4,248,389 3,814,209 434,180 11.4
Deposits 2,436,673 2,379,454 57,219 2.4
Interest bearing
liabilities 3,535,305 3,138,232 397,073 12.7
Shareholders'
equity 311,988 334,431 (22,443) (6.7)
----------------------------------------------------------------------
As of/For the Quarter Ended
---------------------------------------------------------
3/31/04 12/31/03 9/30/03 6/30/03 3/31/03
---------------------------------------------------------
MISCELLANEOUS INFORMATION
Common stock prices
(daily close)
High $ 21.6800 $ 21.2000 $ 20.4000 $ 19.5600 $ 19.4000
Low 19.5200 19.2700 17.0400 16.6900 17.2500
End of
period 21.1400 19.5500 19.6000 17.5900 17.3200
Book Value 10.38 10.08 10.20 10.55 10.87
Market
Capital-
ization 628,876,525 581,029,187 581,005,034 523,475,726 519,442,197
Weighted
average
shares
-basic 29,738,553 29,685,088 29,672,137 29,801,059 30,006,417
Weighted
average
shares
-diluted 30,029,056 29,685,088 29,904,440 29,801,059 30,188,853
End of
period
shares
outst-
anding 29,748,180 29,720,163 29,643,114 29,759,848 29,990,889
----------------------------------------------------------------------
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
(Dollars in thousands, except per share data)
As of/For the Quarter Ended
-------------------------------------------
3/31/04 12/31/03 9/30/03
----------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due from banks $ 75,040 $ 88,564 $ 84,468
Federal funds sold 1,723 1,311 2,004
Interest earning bank deposits 17,951 23,631 42,560
Securities available for sale 1,622,967 1,601,900 1,603,262
Loans held for sale 17,969 5,137 14,784
Loans
Commercial Real Estate 749,355 724,340 732,434
Commercial Non Real Estate 210,010 212,010 199,412
Construction 346,109 358,217 275,005
Mortgage 288,505 280,748 258,927
Consumer 271,686 284,448 279,512
Home equity 414,410 393,041 364,191
----------------------------------
Total loans 2,280,075 2,252,804 2,109,481
Less: Unearned income (209) (167) (190)
Allowance for loan
losses (25,736) (25,607) (23,953)
----------------------------------
Loans, net 2,254,130 2,227,030 2,085,338
----------------------------------
Other assets 258,081 259,120 255,551
----------------------------------
Total assets $4,247,861 $4,206,693 $4,087,967
----------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits
Noninterest-bearing deposits $ 353,133 $ 326,679 $ 337,409
Interest checking and savings 454,024 440,496 425,219
Money market deposits 506,504 470,551 534,148
Time deposits 1,193,781 1,190,171 1,184,806
----------------------------------
Total deposits 2,507,442 2,427,897 2,481,582
Other borrowings 1,377,374 1,432,200 1,261,412
Other liabilities 54,308 47,157 42,710
----------------------------------
Total liabilities 3,939,124 3,907,254 3,785,704
----------------------------------
Total shareholders' equity 308,737 299,439 302,263
----------------------------------
Total liabilities and
shareholders' equity $4,247,861 $4,206,693 $4,087,967
----------------------------------
----------------------------------------------------------------------
SELECTED AVERAGE BALANCES
Loans and loans held for sale $2,273,575 $2,188,643 $2,130,236
Securities 1,590,083 1,585,679 1,560,430
Interest earning assets 3,884,954 3,792,383 3,730,688
Assets 4,248,389 4,192,064 4,071,214
Deposits 2,436,673 2,496,810 2,543,301
Interest bearing liabilities 3,535,305 3,431,144 3,381,916
Shareholders' equity 311,988 312,773 311,962
----------------------------------------------------------------------
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
(Dollars in thousands, except per share data)
As of/For the Quarter Ended
-------------------------------------------
6/30/03 3/31/03
----------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due from banks $ 103,199 $ 97,713
Federal funds sold 1,233 1,121
Interest earning bank deposits 38,308 72,431
Securities available for sale 1,518,918 1,453,827
Loans held for sale 45,311 69,894
Loans
Commercial Real Estate 765,303 800,593
Commercial Non Real Estate 212,753 227,159
Construction 209,926 216,784
Mortgage 257,236 240,115
Consumer 271,734 260,594
Home equity 347,716 332,392
---------------------------------------
Total loans 2,064,668 2,077,637
Less: Unearned income (209) (199)
Allowance for loan
losses (23,644) (26,495)
---------------------------------------
Loans, net 2,040,815 2,050,943
---------------------------------------
Other assets 240,750 245,338
---------------------------------------
Total assets $3,988,534 $3,991,267
---------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits
Noninterest-bearing deposits $ 341,176 $ 308,664
Interest checking and savings 409,415 415,895
Money market deposits 535,021 451,021
Time deposits 1,272,937 1,317,349
---------------------------------------
Total deposits 2,558,549 2,492,929
Other borrowings 1,076,595 1,116,223
Other liabilities 39,474 56,044
---------------------------------------
Total liabilities 3,674,618 3,665,196
---------------------------------------
Total shareholders' equity 313,916 326,071
---------------------------------------
Total liabilities and
shareholders' equity $3,988,534 $3,991,267
---------------------------------------
----------------------------------------------------------------------
SELECTED AVERAGE BALANCES
Loans and loans held for sale $2,179,291 $2,112,226
Securities 1,412,491 1,295,982
Interest earning assets 3,648,447 3,474,071
Assets 3,990,872 3,814,209
Deposits 2,519,240 2,379,454
Interest bearing liabilities 3,286,646 3,138,232
Shareholders' equity 334,537 334,431
----------------------------------------------------------------------
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
(Dollars in thousands, except per share data)
For the Three Months Ended Increase (Decrease)
----------------------------------------------------
3/31/04 3/31/03 Amount Percentage
----------------------------------------------------------------------
INCOME STATEMENT
Interest income -
taxable equivalent $ 45,737 $ 46,017 $ (280) (0.6)%
Interest expense 14,857 18,785 (3,928) (20.9)
-------------------------------------------------
Net interest income
- taxable
equivalent 30,880 27,232 3,648 13.4
Less: taxable
equivalent
adjustment 507 649 (142) (21.9)
-------------------------------------------------
Net interest
income 30,373 26,583 3,790 14.3
Provision for loan
losses 3,000 2,051 949 46.3
-------------------------------------------------
Net interest
income after
provision for
loan losses 27,373 24,532 2,841 11.6
Noninterest income 14,665 15,539 (874) (5.6)
Noninterest expense 28,308 26,033 2,275 8.7
-------------------------------------------------
Income before
income taxes 13,730 14,038 (308) (2.2)
Income taxes 4,490 4,092 398 9.7
-------------------------------------------------
Net income $ 9,240 $ 9,946 $ (706) (7.1)%
-------------------------------------------------
----------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 0.31 $ 0.33 $ (0.02) (6.1)%
Diluted 0.31 0.33 (0.02) (6.1)
Weighted average
shares - basic 29,738,553 30,006,417
Weighted average
shares - diluted 30,029,056 30,188,853
Dividends paid on
common shares $ 0.185 $ 0.185 $ - - %
----------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average
assets 0.87% 1.06%
Return on average
equity 11.91 12.06
Efficiency -
taxable equivalent (1) 62.60 62.66
----------------------------------------------------------------------
For the Three Months Ended
----------------------------------
SCHEDULE OF SELECTED
ITEMS INCLUDED IN
EARNINGS 3/31/04 3/31/03
----------------------------------
Noninterest income
Gain on sale of
securities $326 $1,226
Gain on sale of
credit card loans - 2,213
Equity method
investment loss (224) (100)
Trading gains 109 1,164
Gain on sale of
properties 777 -
----------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(1) - Noninterest expense divided by the sum of taxable equivalent
net interest income plus noninterest income less gain on sale
of securities.
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
(Dollars in thousands, except per share data)
3/31/04 12/31/03 9/30/03 6/30/03 3/31/03
----------------------------------------------------------------------
INCOME STATEMENT
Interest income -
taxable equivalent
Interest and fees on
loans $29,291 $29,282 $29,042 $30,593 $30,458
Interest on securities 16,399 15,743 14,625 14,931 15,374
Other interest income 47 38 97 165 185
-------------------------------------------
Total interest income
- taxable equivalent 45,737 45,063 43,764 45,689 46,017
-------------------------------------------
Interest expense
Interest on deposits 8,125 8,449 9,963 11,667 11,465
Other interest expense 6,732 7,121 7,070 7,435 7,320
-------------------------------------------
Total interest
expense 14,857 15,570 17,033 19,102 18,785
-------------------------------------------
Net interest income -
taxable equivalent 30,880 29,493 26,731 26,587 27,232
Less: Taxable
equivalent adjustment 507 513 531 548 649
-------------------------------------------
Net interest income 30,373 28,980 26,200 26,039 26,583
Provision for loan
losses 3,000 3,575 2,400 19,492 2,051
-------------------------------------------
Net interest income
after provision for
loan losses 27,373 25,405 23,800 6,547 24,532
-------------------------------------------
Noninterest income
Service charges on
deposit accounts 5,605 5,768 5,674 5,571 5,130
Financial management
income 1,502 1,239 1,400 488 578
Gain on sale of
securities 326 505 270 8,286 1,226
Gain on sale of credit
card loan portfolio - - 49 - 2,213
(Loss) income from
equity method
investments (224) 13 78 (276) (100)
Mortgage loan fees 428 508 1,185 578 641
Brokerage services
income 970 857 861 812 486
Insurance services
income 3,031 2,415 2,327 2,229 2,437
Trading gains 109 47 158 432 1,164
Bank owned life
insurance 850 983 992 967 946
Gain on sale of
properties 777 - 382 - -
Other noninterest income 1,291 1,144 1,324 1,128 818
-------------------------------------------
Total noninterest
income 14,665 13,479 14,700 20,215 15,539
-------------------------------------------
Noninterest expense
Salaries and employee
benefits 15,023 15,372 13,133 12,520 13,726
Occupancy and equipment 4,237 4,346 4,079 3,913 4,166
Data processing 862 792 712 634 678
Marketing 1,118 948 1,173 1,161 1,153
Postage and supplies 1,271 1,251 982 1,152 1,136
Professional services 2,712 3,422 3,158 3,230 1,772
Telephone 494 567 584 513 603
Amortization of
intangibles 118 152 127 77 85
Prepayment costs on
borrowings - 11,723 - 7,366 -
Other noninterest
expense 2,473 2,792 2,451 2,422 2,714
-------------------------------------------
Total noninterest
expense 28,308 41,365 26,399 32,988 26,033
-------------------------------------------
Income (loss) before
taxes 13,730 (2,481) 12,101 (6,226) 14,038
Income tax expense
(benefit) 4,490 (1,991) 3,207 (2,022) 4,092
-------------------------------------------
Net income (loss) $ 9,240 $ (490) $ 8,894 $(4,204) $ 9,946
-------------------------------------------
---------------------------------------------------------------------
EARNINGS (LOSS) PER SHARE DATA
Basic $ 0.31 $ (0.02) $ 0.30 $ (0.14) $ 0.33
Diluted 0.31 (0.02) 0.30 (0.14) 0.33
Dividends paid on common
shares 0.185 0.185 0.185 0.185 0.185
---------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average assets 0.87 % (0.05) % 0.87 % (0.42) % 1.06 %
Return on average equity 11.91 (0.62) 11.31 (5.04) 12.06
Efficiency - taxable
equivalent (1) 62.60 97.41 64.14 85.65 62.66
Noninterest income as a
percentage of total
income 32.56 31.75 35.94 43.70 36.89
Equity as a percentage
of total assets 7.27 7.12 7.39 7.87 8.17
Average earning assets
as a percentage of
average assets 91.45 90.47 91.64 91.42 91.08
Average loans as a
percentage of average
deposits 93.31 87.66 83.76 86.51 88.77
----------------------------------------------------------------------
As of/For the Quarter Ended
----------------------------------------------------------------------
SCHEDULE OF SELECTED
ITEMS INCLUDED IN
EARNINGS 3/31/04 12/31/03 9/30/03 6/30/03 3/31/03
-------------------------------------------------
Noninterest income
Gain on sale of
securities $326 $505 $270 $8,286 $1,226
Gain on sale of credit
card loans - - 49 - 2,213
Equity method investment
(loss) income (224) 13 78 (276) (100)
Trading gains 109 47 158 432 1,164
Gain on sale of
properties 777 - 382 - -
Noninterest expense
Prepayment costs on
borrowings - (11,723) - (7,366) -
---------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(1) - Noninterest expense divided by the sum of taxable equivalent
net interest income plus noninterest income less gain on sale
of securities.
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
(Dollars in thousands, except per share data)
As of/For the Quarter Ended
--------------------------------------------------
3/31/04 12/31/03 9/30/03 6/30/03 3/31/03
----------------------------------------------------------------------
ASSET QUALITY ANALYSIS
Allowance for
Loan Losses
Beginning
balance $ 25,607 $ 23,953 $ 23,644 $ 26,495 $ 27,204
Provision for
loan losses 3,000 3,575 2,400 19,492 2,051
Allowance
related to
loans sold (549) - - (20,236) (547)
Charge-offs (2,582) (2,304) (2,238) (2,448) (2,466)
Recoveries 260 383 147 341 253
--------------------------------------------------
Net charge-offs (2,322) (1,921) (2,091) (2,107) (2,213)
--------------------------------------------------
Ending balance $ 25,736 $ 25,607 $ 23,953 $ 23,644 $ 26,495
--------------------------------------------------
Nonperforming
Assets and Loans
90 days
or more past due
accruing
interest
Nonaccrual loans$ 11,845 $ 14,910 $ 13,398 $ 11,144 $ 30,021
Other real
estate 6,199 6,836 6,709 6,866 11,200
--------------------------------------------------
Total
nonperforming
assets 18,044 21,746 20,107 18,010 41,221
--------------------------------------------------
Loans 90 days or
more past due
accruing
interest - 21 21 312 -
--------------------------------------------------
Total $ 18,044 $ 21,767 $ 20,128 $ 18,322 $ 41,221
--------------------------------------------------
Asset Quality
Ratios (1)
Nonaccrual loans
as a percentage
of total loans 0.52 % 0.66 % 0.64 % 0.54 % 1.44 %
Nonperforming
assets as a
percentage of
total assets 0.42 0.52 0.49 0.45 1.03
Nonperforming
assets as a
percentage of
total loans and
other real
estate 0.79 0.96 0.95 0.87 1.97
Net charge-offs
as a percentage
of average loans
(annualized) 0.41 0.35 0.40 0.39 0.43
Allowance for
loan losses as
a percentage of
loans 1.13 1.14 1.14 1.15 1.28
Ratio of
allowance for
loan losses to:
Net charge-offs 2.76 x 3.36 x 2.89 x 2.80 x 2.95 x
Nonaccrual
loans 2.17 1.72 1.79 2.12 0.88
----------------------------------------------------------------------
As of/For the Three Months Ended Increase (Decrease)
----------------------------------------------------------------------
3/31/04 3/31/03 Amount Percentage
----------------------------------------------------------------------
Allowance for Loan Losses
Beginning balance $25,607 $27,204 $(1,597) (5.9)%
Provision for loan losses 3,000 2,051 949 46.3
Allowance related to
loans sold (549) (547) (2) 0.4
Charge-offs (2,582) (2,466) 116 4.7
Recoveries 260 253 7 2.8
---------------------------------
Net charge-offs (2,322) (2,213) 109 4.9
---------------------------------
Ending balance $25,736 $26,495 $ (759) (2.9)%
---------------------------------
Asset Quality Ratios (1)
Net charge-offs as a
percentage of
average loans
(annualized) 0.41 % 0.43 %
Ratio of allowance for
loan losses to
net charge-offs
(annualized) 2.76 x 2.95 x
---------------------------------------------------------------------
For the Quarter Ended
----------------------------------------------------------------------
3/31/04 12/31/03 9/30/03 6/30/03 3/31/03
----------------------------------------------------------------------
ANNUALIZED INTEREST YIELDS / RATES (2)
Interest income:
Yield on loans and loans
held for sale 5.18% 5.31% 5.41% 5.63% 5.85%
Yield on securities 4.13 3.97 3.75 4.23 4.75
------ ------- ------- ------- ------
Yield on interest earning
assets 4.73 4.73 4.67 5.02 5.35
------ ------- ------- ------- ------
Interest expense:
Cost of interest bearing
deposits 1.55 1.59 1.80 2.12 2.23
Cost of borrowings 1.89 2.14 2.38 2.75 2.83
------ ------- ------- ------- ------
Cost of interest bearing
liabilities 1.69 1.80 2.00 2.33 2.43
------ ------- ------- ------- ------
Interest rate spread 3.04 2.93 2.67 2.69 2.92
------ ------- ------- ------- ------
Net yield on earning assets 3.19% 3.10% 2.86% 2.92% 3.15%
------ ------- ------- ------- ------
---------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(1) - Excludes loans held for sale.
(2) - Fully taxable equivalent yields.
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