First Charter Earnings Increase 28% in the Third Quarter.CHARLOTTE, N.C. -- 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 third quarter 2004 earnings of $11.4 million or $0.38 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 $8.9 million, or $0.30 per diluted share, for the same period in 2003. Strong loan growth and a decrease in prepayment speeds Prepayment speed Also called speed, the estimated rate at which mortgagors pay off their loans ahead of schedule, critical in assessing the value of mortgage pass-through securities. in the securities available for sale portfolio resulted in a 9 percent increase in interest income. In addition, the Corporation continued to realize the benefits resulting 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 2004 as interest expense decreased 4 percent. Asset quality remained stable, with 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. at 0.79 percent of loans plus other real estate owned Real Estate Owned Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most and 30 day past due loans at 0.61 percent of loans. "Loans to individuals and businesses continued to grow in the third quarter and our sales force continued to add new core households," 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
In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. a new and better banking relationship." For the nine months ended September September: see month. 30, 2004, First Charter reported earnings of $30.9 million, or $1.02 per diluted share, compared to earnings of $14.6 million, or $0.49 per diluted share, for the same period in 2003. Earnings for the nine months ended September 30, 2003 were impacted by a higher provision for loan losses primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the sale of $60.9 million of nonaccruing and accruing higher risk loans. In addition, interest expense declined 16 percent primarily due to the refinancing of fixed term advances during 2003 and certain asset-liability management transactions entered into during 2004. Third Quarter 2004 compared to Third Quarter 2003 --Total revenues, which are comprised of net interest income and noninterest income, increased $5.9 million or 15 percent driven by loan growth, slower prepayment speeds in the securities available for sale portfolio, higher fee income and reduced interest expense. --Provision for loan losses decreased $0.8 million or 33 percent due to improved asset quality. --Strong loan growth with average loans up 12 percent. Key Customer Indicators --Third quarter 2004 customer service quality score was 82 percent very satisfied. --During the first nine months of 2004, 29,635 new checking accounts were opened. --During the first nine months of 2004, core households increased 8,027. --Customer retention ratio as of September 30, 2004 was 86 percent.
Financial Highlights
For the Three Months For the Nine Months
Earnings Ended September 30 Ended September 30
(Dollars in thousands, ------------------- -------------------
except per share data) 2004 2003 2004 2003
--------------------- -------- -------- -------- --------
Total revenues $ 46,834 $ 40,900 $136,794 $129,276
Net income 11,388 8,894 30,883 14,636
Diluted earnings per share 0.38 0.30 1.02 0.49
Return on average assets 1.04 % 0.87 % 0.96 % 0.50 %
Return on average
equity 15.28 11.64 13.81 6.15
Efficiency-taxable
equivalent ratio (a) 59.47 64.14 61.24 70.47
(a) - Noninterest expense divided by the sum of taxable equivalent
net interest income plus noninterest income less gain on sale of
securities.
Balance Sheet Increase (Decrease)
(Dollars in September 30 December 31 ------------------------
thousands) 2004 2003 Amount Percentage
------------------- ------------ ------------ ----------- ------------
Loans held for sale $ 5,468 $ 5,137 $ 330 6.43 %
Loans, net 2,398,116 2,227,030 171,086 7.68
Investments 1,630,655 1,601,900 28,755 1.80
Total assets 4,409,044 4,206,693 202,351 4.81
Demand, savings and
money market
deposits 1,361,618 1,237,726 123,892 10.01
Total deposits 2,557,062 2,427,897 129,165 5.32
Other borrowings 1,482,340 1,432,200 50,140 3.50
Shareholders'
equity 308,651 299,439 9,212 3.08
For the Nine Months
Average Balances Ended September 30 Increase (Decrease)
(Dollars in ------------------------- ------------------------
thousands) 2004 2003 Amount Percentage
------------------- ------------ ------------ ----------- ------------
Loans held for sale $ 11,022 $ 32,560 $(21,537) (66.15)%
Loans, net 2,324,646 2,108,092 216,554 10.27
Investments 1,618,418 1,423,936 194,481 13.66
Total assets 4,290,442 3,950,565 339,877 8.60
Total deposits 2,524,190 2,481,486 42,703 1.72
Other borrowings 1,422,049 1,105,708 316,341 28.61
Shareholders'
equity 298,737 318,089 (19,353) (6.08)
Net Interest Income/Margin Third quarter Net interest income increased $4.6 million, or 18 percent, to $30.8 million compared to the third quarter of 2003. The increase was primarily due to a $3.7 million increase in interest income primarily resulting from loan growth and a decrease in prepayment speeds in the securities available for sale portfolio. In addition, interest expense decreased $0.7 million, or 4 percent, 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 $81 million of fixed-term advances in the fourth quarter of 2003, and (c) the benefits from certain asset-liability management transactions entered into during 2004. These decreases in interest expense were partially offset by the increase in interest rates. The net interest margin increased to 3.09 percent in the third quarter of 2004 from 2.86 percent for the same period in 2003 as yields earned on interest bearing assets increased slightly and rates paid on interest bearing liabilities declined. Year-to-Date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. Net interest income increased $12.4 million, or 16 percent, to $91.2 million compared to the same period in 2003. The increase was primarily due to an $8.9 million decrease in interest expense primarily resulting from (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 2004. In addition, interest income increased $3.1 million due mainly to loan growth, increases in the securities available for sale portfolio and a decrease in prepayment speeds in the securities available for sale portfolio The net interest margin for the nine months ended September 30, 2004 increased to 3.11 percent from 2.97 percent for the same period in 2003 as rates paid on interest bearing liabilities declined faster than yields earned on interest bearing assets. Noninterest Income Third quarter Noninterest income increased $1.3 million to $16.0 million compared to the third quarter of 2003. The increase was primarily due to (a) a $1.1 million increase in service charges, (b) a $1.0 million increase in gains on the sale of securities, and (c) a $0.4 million increase in other noninterest income due to growth in ATM, debit card debit card, card that allows the cost of goods or services that are purchased to be deducted directly from the purchaser's checking account. They can also be used at automated teller machines for withdrawing cash from the user's checking account. and other miscellaneous fees. In addition, a $0.3 million gain was recognized on the sale of our Lake Lure branch deposits and loans in August of 2004. These increases were partially offset by (a) a $0.8 million decrease in mortgage loan fees as 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 has declined and the Bank has retained a larger portion of mortgage loans in 2004 and (b) a $0.2 million decrease in brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. income. In addition, trading gains of $0.2 million and property sale gains of $0.4 million were recognized in the third quarter of 2003. Year-to-Date Noninterest income decreased $4.9 million to $45.6 million compared to the same period in 2003. Gains on the sale of securities of $2.1 million were recognized in the first nine months of 2004 compared to $9.8 million in 2003, representing a decrease of $7.7 million. Gains totaling $2.3 million from the sale of the Corporation's credit card portfolio and $1.8 million of trading gains were recognized in the first nine months of 2003. In addition, mortgage loan fees decreased $1.0 million as origination volume has declined and the Bank has retained a larger portion of mortgage loans in 2004. These decreases in noninterest income were partially offset by (a) a $2.4 million increase in service charges, (b) a $2.2 million increase in financial management income primarily due to the acquisition of a third party benefits administrator in the third quarter of 2003, (c) a $1.4 million increase in other noninterest income due to growth in ATM, debit card and other miscellaneous fees, and (d) a $1.1 million increase in insurance services income primarily due to the acquisition of two insurance agencies in the third and fourth quarter of 2003. In addition, gains totaling $0.8 million from the sale of bank property were recognized in the first nine months of 2004 versus $0.4 million in the same 2003 period and a $0.3 million gain was recognized on the sale of our Lake Lure branch deposits and loans in 2004. Noninterest Expense Third quarter Noninterest expense increased $0.9 million to $27.3 million compared to the third quarter of 2003. The increase was primarily due to a $1.6 million increase in salaries and employee benefits due to (a) additional personnel, including the acquisition of two insurance agencies and (b) increased 401(k) 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. for the Corporation's contribution resulting from a projected increase in 2004 earnings. This increase was partially offset by a $0.9 million decrease in professional service fees. Year-to-Date Noninterest expense decreased $2.1 million to $83.3 million compared to the first nine months of 2003. The decrease was due to $7.4 million of prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. costs associated with refinancing $50 million in fixed term advances in the second quarter of 2003 that did not recur in 2004. In addition, professional service fees decreased $0.8 million. These decreases were partially offset by a $4.8 million increase in salaries and employee benefits due to (a) additional personnel, including the acquisition of a third party benefits administrator and two insurance agencies and (b) increased 401(k) accruals for the Corporation's contribution resulting from a projected increase in 2004 earnings. Efficiency Ratio The efficiency ratio decreased to 59.5 percent compared to 64.1 percent for the third quarter of 2003. The calculation of the efficiency ratio excludes gains on sale of securities of $1.3 million and $0.3 million for the three months ended September 30, 2004 and 2003, respectively. Income Tax Expense Third quarter Total income tax expense for the third quarter of 2004 was $6.5 million for an effective tax rate of 36.3 percent compared to $3.2 million for an effective tax rate of 26.5 percent for the third 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 and an increase in accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. taxes resulting from a proposed tax assessment received in the third quarter. The Corporation is appealing this assessment. Year-to-Date The income tax expense for the first nine months of 2004 amounted to $16.0 million for an effective tax rate of 34.1 percent compared to $5.3 million for an effective tax rate of 26.5 percent the first nine months of 2003. The increase in the effective tax rate for 2004 was due to an increase in projected taxable income relative to nontaxable adjustments and an increase in accrued taxes resulting from a proposed tax assessment received in the third quarter. The Corporation is appealing this assessment. 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. Loans held for sale increased to $5.5 million at September 30, 2004 as compared to $5.1 million at December December: see month. 31, 2003. During the first nine months of 2004, $40.7 million of residential mortgage loans were moved to securities available for sale ("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. ") and subsequently sold. Loans Gross loans increased $172.5 million to $2.43 billion at September 30, 2004 as compared to $2.25 billion at December 31, 2003. The growth in loans was due to a $66.5 million increase in home equity loans, a $64.2 million increase in commercial real estate loans, a $50.5 million increase in mortgage loans and a $6.1 million increase in consumer loans. These increases were partially offset by a $13.0 million decrease in construction loans and a $1.8 million decrease in commercial non-real estate loans. In addition, $6.4 million of nonaccruing and accruing higher risk residential mortgage loans were sold to investors during the first quarter of 2004. Securities The securities available for sale portfolio increased $28.8 million to $1.63 billion at September 30, 2004 as compared to December 31, 2003. The increase in the securities available for sale portfolio was primarily due to the purchase of agency securities funded by the proceeds from the sale of the previously mentioned securitized residential mortgage loans. The securities available for sale portfolio was also impacted by an increase in the unrealized net losses in the portfolio due to a rise in short and intermediate-term Intermediate-term Typically one-ten years. intermediate-term Of or relating to an investment with an expected holding period somewhere between short-term and long-term. interest rates. Unrealized net losses on securities available for sale were $1.4 million at September 30, 2004 compared to unrealized net gains of $10.1 million at December 31, 2003. Deposits The Corporation's CHecking Account Marketing Program (CHAMP) continues to attract new customers and deposits. During the first nine months of 2004, 29,635 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. The emphases of these programs are to develop new customer relationships, shift our funding mix towards lower-cost funding sources and generate additional fee income opportunities. Total deposits increased $129.2 million, or 5 percent, to $2.56 billion at September 30, 2004 compared to $2.43 billion at December 31, 2003. The increase in deposits was due to a $74.1 million increase in money market accounts, a $49.8 million increase in low-cost interest checking, savings and noninterest bearing deposits. Also, as a result of the Corporation's strategy of shifting the funding mix, lower-cost brokered certificates of deposit increased $60.7 million, while higher-cost retail certificates of deposit decreased $55.4 million. 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 September 30, 2004 increased to $308.7 million compared to $299.4 million at December 31, 2003. The 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. unrealized loss Unrealized Loss A loss that results from holding onto an asset rather than cashing it in and officially taking the loss. Notes: Let's say you own a stock that is down 50%, but you haven't sold it to realize the loss yet. This is said to be an unrealized loss. on available for sale securities was $0.9 million at September 30, 2004 compared to an 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. of $6.2 million at December 31, 2003. The change was due to an increase in short and intermediate-term interest rates. At September 30, 2004, the book value per share was $10.35. Based on the $24.17 closing price of First Charter Corporation common stock at September 30, 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 $721.0 million. Provision for Loan Losses The provision for loan losses decreased to $1.6 million for the three months ended September 30, 2004 compared to $2.4 million for the same year ago period. The decrease in the provision for loan losses was due to improved asset quality trends resulting in lower net charge-offs. The provision for loan losses for the nine months ended September 30, 2004 amounted to $6.6 million compared to $23.9 million for the same year ago period. The decrease in the provision for loan losses was primarily attributable to the previously mentioned $60.9 million sale of nonaccruing and accruing higher risk loans and a $2.4 million increase in the provision related to 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 identified in the second quarter of 2003. Net Charge-Offs Third quarter Net charge-offs for the three months ended September 30, 2004 amounted to $0.8 million, or 0.13 percent of average loans, compared to $2.1 million, or 0.40 percent of average loans for the same 2003 period. The decrease in net charge-offs was due to the recovery of $0.4 million from the sale of previously charged-off loans and lower charge-offs in all loan categories. Year-to-Date Net charge-offs for the nine months ended September 30, 2004 amounted to $4.8 million, or 0.27 percent of average loans compared to $6.4 million, or 0.41 percent of average loans for the same 2003 period. Net charge-offs benefited from a $0.6 million commercial loan recovery during the second quarter of 2004 and a third quarter 2004 recovery of $0.4 million from the sale of previously charged-off loans. Nonperforming Assets Nonaccrual loans at September 30, 2004 decreased to $14.2 million compared to $14.9 million at December 31, 2003. The decrease includes the sale of $2.1 million of nonaccrual mortgage loans in the first quarter of 2004. Other real estate owned decreased to $5.0 million at September 30, 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 nine months of 2004, our asset quality ratios remain strong as evidenced in the following table.
Asset Quality (1)
September 30 June 30 March 31 December 31 September 30
2004 2004 2004 2003 2003
------------ ------- -------- ----------- ------------
Past Due Ratio
--------------
Past due loans
over 30 days as
a percentage of
loans 0.61% 0.47% 0.64% 1.04% 0.71%
Nonaccrual Loans
----------------
Nonaccrual loans
as a percentage
of loans 0.59% 0.53% 0.52% 0.66% 0.64%
Nonperforming Assets
--------------------
Nonperforming
assets as a
percentage of
loans and other
real estate
owned 0.79% 0.79% 0.79% 0.96% 0.95%
Charge-offs
-----------
Net charge-offs
as a percentage
of average
loans-
annualized 0.13% 0.29% 0.41% 0.35% 0.40%
Allowance for Loan Losses
-------------------------
Allowance for loan
losses as a
percentage of
loans 1.11% 1.11% 1.13% 1.14% 1.14%
Allowance for
loan losses as a
percentage of
nonaccrual
loans 189% 208% 217% 172% 179%
(1) Excludes loans held for sale.
Allowance for Loan Losses The allowance for loan losses as a percentage of total loans decreased to 1.11 percent at September 30, 2004 compared to 1.14 percent at December 31, 2003. The allowance for loan losses decreased primarily due to improved asset quality trends as well as a change in the mix of the loan portfolio towards 1-4 family mortgages and home equity lines of credit. This type of secured lending generally carries lower credit risk and thus requires lower allocations in our allowance model. 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's executive management will be available via telephone conference to discuss the contents of this press release and to present growth and earnings estimates for the remainder of 2004 on Thursday Thursday: see week. , October October: see month. 14, 2004 at 11:00 a.m. The following table outlines access information for the conference call and internet/audio replay:
US/Canada International
Participants Participants
----------------------------------------------------------------------
Live Conference Call 800-379-3953 706-679-5254
ID # 1163675 ID # 1163675
----------------------------------------------------------------------
Internet Live and Replay www.FirstCharter.com www.FirstCharter.com
"Investor Relations" "Investor Relations"
section section
SHOW # 187603 SHOW # 187603
----------------------------------------------------------------------
Audio Replay 800-642-1687 706-645-9291
ID # 1163675 ID # 1163675
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 $4.4 billion and is the holding company for First Charter Bank. First Charter operates 53 financial centers, six insurance offices and 99 ATMs located in 18 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) the passage of future tax legislation, or any negative regulatory, administrative or judicial position, may adversely impact 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. (Selected financial information is attached)
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
As of / For the Nine
Months Ended Increase (Decrease)
(Dollars in thousands, --------------------------------------------
except per share data) 9/30/2004 9/30/2003 Amount Percentage
----------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due from banks $ 98,000 $ 84,468 $ 13,532 16.0 %
Federal funds sold 2,080 2,004 76 3.8
Interest earning bank
deposits 9,259 42,560 (33,301) (78.2)
Securities available for
sale 1,630,655 1,603,262 27,393 1.7
Loans held for sale 5,468 14,784 (9,316) (63.0)
Loans
Commercial Real Estate 788,539 732,434 56,105 7.7
Commercial Non Real
Estate 210,214 199,412 10,802 5.4
Construction 345,178 275,005 70,173 25.5
Mortgage 331,249 258,927 72,322 27.9
Consumer 290,569 279,512 11,057 4.0
Home equity 459,527 364,191 95,336 26.2
------------------------------------------
Total loans 2,425,276 2,109,481 315,795 15.0
Less: Unearned income (301) (190) (111) 58.4
Allowance for loan
losses (26,859) (23,953) (2,906) 12.1
------------------------------------------
Loans, net 2,398,116 2,085,338 312,778 15.0
------------------------------------------
Other assets 265,466 255,551 9,915 3.9
------------------------------------------
Total assets $4,409,044 $4,087,967 $321,077 7.9 %
------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits
Noninterest-bearing
deposits $ 368,156 $ 337,409 $ 30,747 9.1 %
Interest checking and
savings 448,799 425,219 23,580 5.5
Money market deposits 544,663 534,148 10,515 2.0
Time deposits 1,195,444 1,184,806 10,638 0.9
------------------------------------------
Total deposits 2,557,062 2,481,582 75,480 3.0
Other borrowings 1,482,340 1,261,412 220,928 17.5
Other liabilities 60,991 42,710 18,281 42.8
------------------------------------------
Total liabilities 4,100,393 3,785,704 314,689 8.3
------------------------------------------
Total shareholders'
equity 308,651 302,263 6,388 2.1
------------------------------------------
Total liabilities and
shareholders' equity $4,409,044 $4,087,967 $321,077 7.9 %
------------------------------------------
--------------------------------------------------------------------
SELECTED AVERAGE BALANCES
Loans and loans held
for sale $2,335,669 $2,140,652 $195,017 9.1 %
Securities 1,618,418 1,423,936 194,482 13.7
Interest earning assets 3,972,099 3,618,677 353,422 9.8
Assets 4,290,442 3,950,565 339,877 8.6
Deposits 2,524,190 2,481,486 42,704 1.7
Interest bearing
liabilities 3,590,569 3,269,824 320,745 9.8
Shareholders' equity 298,737 318,089 (19,352) (6.1)
--------------------------------------------------------------------
As of / For the Quarter Ended
--------------------------------------
9/30/2004 6/30/2004 3/31/2004
--------------------------------------
MISCELLANEOUS INFORMATION
Common stock prices
(daily close)
High $ 24.50 $21.89 $ 21.68
Low 20.86 20.05 19.52
End of period 24.17 21.79 21.14
Book Value 10.35 9.53 10.38
Market Capitalization 720,988,635 648,666,205 628,876,525
Weighted average
shares - basic 29,810,917 29,763,619 29,738,553
Weighted average
shares - diluted 30,231,191 30,067,462 30,029,056
End of period shares
outstanding 29,829,898 29,768,986 29,748,180
----------------------------------------------------------------------
As of / For the Quarter Ended
-----------------------------
12/31/2003 9/30/2003
-----------------------------
MISCELLANEOUS INFORMATION
Common stock prices (daily close)
High $ 21.20 $ 20.40
Low 19.27 17.04
End of period 19.55 19.60
Book Value 10.08 10.20
Market Capitalization 581,029,187 581,005,034
Weighted average shares - basic 29,685,088 29,672,137
Weighted average shares - diluted 29,685,088 29,904,440
End of period shares outstanding 29,720,163 29,643,114
---------------------------------------------------------------------
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
(Dollars in
thousands, As of / For the Quarter Ended
except per ------------------------------------------------------
share data) 9/30/2004 6/30/2004 3/31/2004 12/31/2003 9/30/2003
----------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due
from banks $ 98,000 $ 94,749 $ 75,040 $ 88,564 $ 84,468
Federal funds
sold 2,080 1,960 1,723 1,311 2,004
Interest earning
bank deposits 9,259 19,513 17,951 23,631 42,560
Securities
available for
sale 1,630,655 1,604,585 1,622,967 1,601,900 1,603,262
Loans held for
sale 5,468 26,768 17,969 5,137 14,784
Loans
Commercial Real
Estate 788,539 768,637 749,355 724,340 732,434
Commercial Non
Real Estate 210,214 208,587 210,010 212,010 199,412
Construction 345,178 332,031 346,109 358,217 275,005
Mortgage 331,249 315,005 288,505 280,748 258,927
Consumer 290,569 276,236 271,686 284,448 279,512
Home equity 459,527 447,739 414,410 393,041 364,191
------------------------------------------------------
Total loans 2,425,276 2,348,235 2,280,075 2,252,804 2,109,481
Less: Unearned
income (301) (197) (209) (167) (190)
Allowance for
loan losses (26,859) (26,052) (25,736) (25,607) (23,953)
------------------------------------------------------
Loans, net 2,398,116 2,321,986 2,254,130 2,227,030 2,085,338
------------------------------------------------------
Other assets 265,466 269,652 258,081 259,120 255,551
------------------------------------------------------
Total assets $4,409,044 $4,339,213 $4,247,861 $4,206,693 $4,087,967
------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits
Noninterest-
bearing
deposits $ 368,156 $ 368,738 $ 353,133 $ 326,679 $ 337,409
Interest
checking and
savings 448,799 450,950 454,024 440,496 425,219
Money market
deposits 544,663 563,523 506,504 470,551 534,148
Time deposits 1,195,444 1,211,554 1,193,781 1,190,171 1,184,806
------------------------------------------------------
Total
deposits 2,557,062 2,594,765 2,507,442 2,427,897 2,481,582
Other
borrowings 1,482,340 1,410,481 1,377,374 1,432,200 1,261,412
Other
liabilities 60,991 50,186 54,308 47,157 42,710
------------------------------------------------------
Total
liabilities 4,100,393 4,055,432 3,939,124 3,907,254 3,785,704
------------------------------------------------------
Total
shareholders'
equity 308,651 283,781 308,737 299,439 302,263
------------------------------------------------------
Total
liabilities
and
shareholders'
equity $4,409,044 $4,339,213 $4,247,861 $4,206,693 $4,087,967
------------------------------------------------------
----------------------------------------------------------------------
SELECTED AVERAGE BALANCES
Loans and
loans held
for sale $2,393,362 $2,339,435 $2,273,575 $2,188,643 $2,130,236
Securities 1,627,156 1,637,918 1,590,083 1,585,679 1,560,430
Interest
earning
assets 4,035,259 3,995,390 3,884,954 3,792,383 3,730,688
Assets 4,343,207 4,316,360 4,210,401 4,158,189 4,062,106
Deposits 2,586,524 2,547,909 2,436,673 2,496,810 2,543,301
Interest
bearing
liabilities 3,625,679 3,610,337 3,535,305 3,431,144 3,381,916
Shareholders'
equity 296,539 296,699 303,722 304,097 303,186
----------------------------------------------------------------------
First Charter Corporation and Subsidiaries
Quarterly Earnings Release
For the Three Months Ended Increase (Decrease)
(Dollars in thousands, ----------------------------------------------
except per share data) 9/30/2004 9/30/2003 Amount Percentage
----------------------------------------------------------------------
INCOME STATEMENT
Interest income -
taxable equivalent $ 47,496 $ 43,764 $ 3,732 8.5 %
Interest expense 16,287 17,033 (746) (4.4)
------------------------------------------
Net interest income -
taxable equivalent 31,209 26,731 4,478 16.8
Less: taxable equivalent
adjustment 414 531 (117) (22.0)
------------------------------------------
Net interest income 30,795 26,200 4,595 17.5
Provision for loan
losses 1,600 2,400 (800) (33.3)
------------------------------------------
Net interest income
after provision for
loan losses 29,195 23,800 5,395 22.7
Noninterest income 16,039 14,700 1,339 9.1
Noninterest expense 27,347 26,399 948 3.6
------------------------------------------
Income before income
taxes 17,887 12,101 5,786 47.8
Income tax expense 6,499 3,207 3,292 102.7
------------------------------------------
Net income $ 11,388 $ 8,894 $ 2,494 28.0 %
------------------------------------------
--------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 0.38 $ 0.30 $ 0.08 26.7 %
Diluted 0.38 0.30 0.08 26.7
Weighted average
shares - basic 29,810,917 29,672,137
Weighted average
shares - diluted 30,231,191 29,904,440
Dividends paid on
common shares $ 0.190 $ 0.185 $ 0.005 5.3 %
--------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average assets 1.04 % 0.87 %
Return on average equity 15.28 11.64
Efficiency - taxable
equivalent (a) 59.47 64.14
--------------------------------------------------------------------
For the Three Months Ended
SCHEDULE OF SELECTED ITEMS --------------------------
INCLUDED IN EARNINGS 9/30/2004 9/30/2003
--------------------------
Noninterest income
Gain on sale of securities $ 1,267 $ 270
Gain on sale of deposits and loans 339 -
Gain on sale of credit card loans - 49
Equity method investment loss - 78
Trading gains 7 158
Gain on sale of properties - 382
--------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(a) - 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
For the Nine Months Ended Increase (Decrease)
(Dollars in thousands, --------------------------------------------
except per share data) 9/30/2004 9/30/2003 Amount Percentage
---------------------------------------------------------------------
INCOME STATEMENT
Interest income - taxable
equivalent $ 138,608 $ 135,470 $ 3,138 2.3 %
Interest expense 46,018 54,920 (8,902) (16.2)
------------------------------------------
Net interest income
- taxable equivalent 92,590 80,550 12,040 14.9
Less: taxable equivalent
adjustment 1,390 1,728 (338) (19.6)
------------------------------------------
Net interest income 91,200 78,822 12,378 15.7
Provision for loan losses 6,600 23,943 (17,343) (72.4)
------------------------------------------
Net interest income
after provision for
loan losses 84,600 54,879 29,721 54.2
Noninterest income 45,594 50,454 (4,860) (9.6)
Noninterest expense 83,340 85,420 (2,080) (2.4)
------------------------------------------
Income before income
taxes 46,854 19,913 26,941 135.3
Income taxes 15,971 5,277 10,694 202.7
------------------------------------------
Net income $ 30,883 $ 14,636 $ 16,247 111.0 %
------------------------------------------
--------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 1.04 $ 0.49 $ 0.55 112.2 %
Diluted 1.02 0.49 0.53 108.2
Weighted average
shares - basic 29,797,642 29,825,313
Weighted average
shares - diluted 30,134,952 30,020,709
Dividends paid on common
shares $ 0.560 $ 0.555 $ 0.005 0.9 %
--------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average assets 0.96 % 0.50 %
Return on average equity 13.81 6.15
Efficiency - taxable
equivalent (a) 61.24 70.47
--------------------------------------------------------------------
SCHEDULE OF SELECTED
ITEMS INCLUDED IN For the Nine Months Ended
EARNINGS -------------------------
9/30/2004 9/30/2003
---------------------
Noninterest income
Gain on sale of securities $ 2,087 $ 9,782
Gain on sale of deposits and loans 339 -
Gain on sale of credit card loans - 2,262
Equity method investment loss (300) (298)
Trading gains 111 1,754
Gain on sale of properties 777 382
Noninterest expense
Prepayment costs on borrowings - (7,366)
--------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(a) - 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
uarterly Earnings Release
(Dollars in As of / For the Quarter Ended
thousands, except ---------------------------------------------------
per share data) 9/30/2004 6/30/2004 3/31/2004 12/31/2003 9/30/2003
----------------------------------------------------------------------
INCOME STATEMENT
Interest income
- taxable
equivalent
Interest and
fees on loans $ 31,406 $ 29,373 $ 29,291 $ 29,282 $ 29,042
Interest on
securities 16,046 15,960 16,399 15,743 14,625
Other interest
income 44 42 47 38 97
-------------------------------------------------
Total interest
income - taxable
equivalent 47,496 45,375 45,737 45,063 43,764
-------------------------------------------------
Interest expense
Interest on
deposits 8,916 8,619 8,125 8,449 9,963
Other interest
expense 7,371 6,255 6,732 7,121 7,070
-------------------------------------------------
Total interest
expense 16,287 14,874 14,857 15,570 17,033
-------------------------------------------------
Net interest
income - taxable
equivalent 31,209 30,501 30,880 29,493 26,731
Less: Taxable
equivalent
adjustment 414 469 507 513 531
-------------------------------------------------
Net interest
income 30,795 30,032 30,373 28,980 26,200
Provision for loan
losses 1,600 2,000 3,000 3,575 2,400
-------------------------------------------------
Net interest
income after
provision for
loan losses 29,195 28,032 27,373 25,405 23,800
-------------------------------------------------
Noninterest income
Service charges on
deposit accounts 6,781 6,346 5,605 5,768 5,674
Financial
management income 1,602 1,545 1,502 1,239 1,400
Gain on sale of
securities 1,267 494 326 505 270
Gain on sale of
deposits and
loans 339 - - - -
Gain on sale of
credit card loan
portfolio - - - - 49
(Loss) income from
equity method
investments - (76) (224) 13 78
Mortgage loan fees 365 596 428 508 1,185
Brokerage services
income 612 902 970 857 861
Insurance services
income 2,464 2,634 3,031 2,415 2,327
Trading gains
(losses) 7 (5) 109 47 158
Bank owned life
insurance 860 847 850 983 992
Gain on sale of
properties - - 777 - 382
Other noninterest
income 1,742 1,607 1,291 1,144 1,324
-------------------------------------------------
Total noninterest
income 16,039 14,890 14,665 13,479 14,700
-------------------------------------------------
Noninterest
expense
Salaries and
employee benefits 14,779 14,368 15,023 15,372 13,133
Occupancy and
equipment 4,115 4,379 4,237 4,346 4,079
Data processing 945 1,006 862 792 712
Marketing 1,141 1,126 1,118 948 1,173
Postage and
supplies 1,204 1,306 1,271 1,251 982
Professional
services 2,264 2,361 2,712 3,422 3,158
Telephone 496 507 494 567 584
Amortization of
intangibles 111 96 118 152 127
Prepayment costs
on borrowings - - - 11,723 -
Other noninterest
expense 2,292 2,536 2,473 2,792 2,451
-------------------------------------------------
Total noninterest
expense 27,347 27,685 28,308 41,365 26,399
-------------------------------------------------
Income (loss)
before taxes 17,887 15,237 13,730 (2,481) 12,101
Income tax expense
(benefit) 6,499 4,982 4,490 (1,991) 3,207
-------------------------------------------------
Net income (loss) $ 11,388 $ 10,255 $ 9,240 $ (490) $ 8,894
-------------------------------------------------
----------------------------------------------------------------------
EARNINGS (LOSS) PER
SHARE DATA
Basic $ 0.38 $ 0.34 $ 0.31 $ (0.02) $ 0.30
Diluted 0.38 0.34 0.31 (0.02) 0.30
Dividends paid on
common shares 0.190 0.185 0.185 0.185 0.185
----------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average
assets 1.04 % 0.96 % 0.88 % (0.05) % 0.87 %
Return on average
equity 15.28 13.90 12.20 (0.64) 11.64
Efficiency -
taxable
equivalent(a) 59.47 61.66 62.60 97.41 64.14
Noninterest income
as a percentage
of total income 34.25 33.15 32.56 31.75 35.94
Equity as a
percentage of
total assets 7.00 6.54 7.27 7.12 7.39
Average earning
assets as a
percentage of
average assets 92.91 92.56 92.27 91.20 91.84
Average loans as a
percentage of
average deposits 92.53 91.82 93.31 87.66 83.76
----------------------------------------------------------------------
SCHEDULE OF
SELECTED ITEMS As of / For the Quarter Ended
INCLUDED IN ---------------------------------------------------
EARNINGS 9/30/2004 6/30/2004 3/31/2004 12/31/2003 9/30/2003
---------------------------------------------------
Noninterest income
Gain on sale of
securities $ 1,267 $ 494 $ 326 $ 505 $ 270
Gain on sale of
deposits and
loans 339 - - - -
Gain on sale of
credit card
loans - - - - 49
Equity method
investment
(loss) income - (76) (224) 13 78
Trading gains
(losses) 7 (5) 109 47 158
Gain on sale of
properties - - 777 - 382
Noninterest
expense
Prepayment costs
on borrowings - - - (11,723) -
----------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(a) - 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 As of / For the Quarter Ended
thousands, except ---------------------------------------------------
per share data) 9/30/2004 6/30/2004 3/31/2004 12/31/2003 9/30/2003
----------------------------------------------------------------------
ASSET QUALITY
ANALYSIS
Allowance for Loan
Losses
Beginning
balance $ 26,052 $ 25,736 $ 25,607 $ 23,953 $ 23,644
Provision for
loan losses 1,600 2,000 3,000 3,575 2,400
Allowance
related to
loans sold (35) - (549) - -
Charge-offs (1,432) (2,475) (2,582) (2,304) (2,238)
Recoveries 674 791 260 383 147
-------------------------------------------------
Net charge-
offs (758) (1,684) (2,322) (1,921) (2,091)
-------------------------------------------------
Ending
balance $ 26,859 $ 26,052 $ 25,736 $ 25,607 $ 23,953
-------------------------------------------------
Nonperforming
Assets and Loans
90 days or more
past due accruing
interest
Nonaccrual
loans $ 14,237 $ 12,533 $ 11,845 $ 14,910 $ 13,398
Other real
estate 4,962 6,159 6,199 6,836 6,709
-------------------------------------------------
Total
nonperfor-
ming assets 19,199 18,693 18,044 21,746 20,107
-------------------------------------------------
Loans 90 days
or more past
due accruing
interest 56 - - 21 21
---------------------------------------------------
Total $ 19,255 $ 18,693 $ 18,044 $ 21,767 $ 20,128
---------------------------------------------------
Asset Quality
Ratios(a)
Nonaccrual
loans as a
percentage
of total
loans 0.59 % 0.53 % 0.52 % 0.66 % 0.64 %
Nonperforming
assets as a
percentage
of total
assets 0.44 0.43 0.42 0.52 0.49
Nonperforming
assets as a
percentage
of total
loans and
other real
estate 0.79 0.79 0.79 0.96 0.95
Net charge-
offs as a
percentage
of average
loans
(annualized) 0.13 0.29 0.41 0.35 0.40
Allowance for
loan losses
as a
percentage
of loans 1.11 1.11 1.13 1.14 1.14
Ratio of
allowance
for loan
losses to:
Net charge-
offs 8.91 x 3.85 x 2.76 x 3.36 x 2.89 x
Nonaccrual
loans 1.89 2.08 2.17 1.72 1.79
----------------------------------------------------------------------
As of / For the Nine Increase (Decrease)
Months Ended
------------------------------------------------
9/30/2004 9/30/2003 Amount Percentage
----------------------------------------------------------------------
Allowance for Loan
Losses
Beginning
balance $ 25,607 $ 27,204 $ (1,597) (5.9)%
Provision for
loan losses 6,600 23,943 (17,343) (72.4)
Allowance
related to
loans sold (584) (20,783) 20,199 (97.2)
Charge-offs (6,489) (7,152) (663) (9.3)
Recoveries 1,725 741 984 132.8
---------------------------------------------------
Net charge-
offs (4,764) (6,411) (1,647) (25.7)
---------------------------------------------------
Ending
balance $ 26,859 $ 23,953 $ 2,906 12.1 %
---------------------------------------------------
Asset Quality
Ratios (a)
Net charge-
offs as a
percentage
of average
loans
(annualized) 0.27 % 0.41 %
Ratio of
allowance
for loan
losses to
net charge-
offs
(annualized) 4.23 x 2.79 x
----------------------------------------------------------------------
For the Quarter Ended
---------------------------------------------------
9/30/2004 6/30/2004 3/31/2004 12/31/2003 9/30/2003
----------------------------------------------------------------------
ANNUALIZED INTEREST
YIELDS / RATES (b)
Interest income:
Yield on
loans and
loans held
for sale 5.22 % 5.05 % 5.18 % 5.31 % 5.41 %
Yield on
securities 3.94 3.90 4.13 3.97 3.75
---------------------------------------------------
Yield on
interest
earning
assets 4.69 4.56 4.73 4.73 4.67
---------------------------------------------------
Interest expense:
Cost of
interest
bearing
deposits 1.60 1.59 1.55 1.59 1.80
Cost of
borrowings 2.08 1.77 1.89 2.14 2.38
---------------------------------------------------
Cost of
interest
bearing
liabilities 1.79 1.66 1.69 1.80 2.00
---------------------------------------------------
Interest rate
spread 2.90 2.90 3.04 2.93 2.67
---------------------------------------------------
Net yield on
earning assets 3.09 % 3.06 % 3.19 % 3.10 % 2.86 %
---------------------------------------------------
----------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(a) - Excludes loans held for sale.
(b) - Fully taxable equivalent yields.
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion