First Charter Reports Record Quarterly Net Interest Income.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 ): Second Quarter 2006 Highlights - Compared to Second Quarter 2005: --Balance Sheet Growth and Net Interest Margin Improvement Drive Record Tax Equivalent Net Interest Income of $33.2 Million. --Net Income Increases $0.3 Million to $11.5 Million. --Commercial Lending Focus And Raleigh Raleigh (rôl`ē, räl`ē), city (1990 pop. 207,951), state capital, and seat of Wake co., central N.C.; the site was selected for the capital in 1788, and the city was laid out and inc. 1792. Market Entry Help Push Commercial Loan Average Balances Up $244.5 Million, or 18%. --Money Market and Noninterest Bearing Deposit Growth Drive $181.5 Million, or 14%, Increase in Core Deposit Average Balances. --Net Interest Margin Improves 33 Basis Points to 3.36%. Additional Second Quarter 2006 Highlights at First Charter --First Charter Announced Atlanta Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. , GA Market Entry Through Merger With Gwinnett Gwinnett can refer to:
--Strong Credit Quality Continues, Annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. Net Charge-offs 0.11% of Average Loans. --Raleigh Balance Sheet Growth Exceeds Expectations. --Customer Satisfaction Scores Continue Strong - 84% Rate "Very-Satisfied" With First Charter. --First Charter Looks to Optimize optimize - optimisation Retail Network Through Announced Sale of Two Branches. --First Charter Announced Fifteenth In music, a fifteenth (sometimes abbreviated 15ma) is the interval between one musical note and another with one-quarter or quadruple the frequency. It corresponds to two octaves. It is the fourth harmonic. Consecutive Annual Increase In Dividends. First Charter Corporation (NASDAQ: FCTR) today reported that 2006 second quarter net income increased 2 percent to $11.5 million from $11.3 million in the same quarter a year ago. The improved performance was driven largely by an improved net interest margin, strong loan and deposit growth and solid credit quality. On a fully 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. basis, earnings per share were $0.37, the same level as the second quarter of 2005 and the first quarter of 2006. The impact of expensing equity compensation under FAS 123R reduced quarterly net income by approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 1.4 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. in each quarter of 2006. Earnings in the second quarter of 2005 were not similarly impacted. Return on average assets and return on average equity were 1.08 percent and 13.78 percent, respectively, for the second quarter of 2006 compared to 1.00 percent and 14.12 percent for the second quarter of 2005 and 1.10 percent and 14.12 percent for the first quarter of 2006. For the first six months of 2006, First Charter earned $23.0 million, or $0.74 per share, compared to $21.6 million, or $0.71 per share, a year earlier. "First Charter's journey towards becoming a high-performing 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 took several critical steps in the second quarter," said Bob James Bob James can refer to different people:
"Further," James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. continued, "we are executing our growth strategy with several significant developments for our company. For example, our de novo [Latin, Anew.] A second time; afresh. A trial or a hearing that is ordered by an appellate court that has reviewed the record of a hearing in a lower court and sent the matter back to the original court for a new trial, as if it had not been previously heard nor decided. Raleigh market entry has produced better balance sheet growth than we expected at this time, and we have found the right partner and platform, Gwinnett Banking Company, to introduce First Charter to the high-growth metro Atlanta market. Additionally, we continue to look for additional operating efficiencies as evidenced by the recently announced sale of 2 financial centers in western North Carolina Western North Carolina (often abbreviated as WNC) is the region of North Carolina which includes the Appalachian Mountains, thus it is often known geographically as the state's Mountain Region. ."
Financial Highlights
Earnings For the Three Months For the Six Months
Ended June 30 Ended June 30
(Dollars in thousands, -----------------------------------------------
except per share data) 2006 2005 2006 2005
----------------------------------------------------------------------
Total revenues (1) $ 49,887 $ 48,607 $ 100,218 $ 94,995
Net income 11,546 11,280 22,990 21,589
Diluted earnings per
share 0.37 0.37 0.74 0.71
Financial Ratios
----------------------
Return on average
assets 1.08 % 1.00 % 1.09 % 0.97 %
Return on average
equity 13.78 14.12 13.95 13.67
Efficiency-taxable
equivalent ratio (2) 62.33 59.70 62.11 60.54
Average Balance Sheet
----------------------
Loans, net $3,030,815 $2,788,438 $2,988,596 $2,670,810
Securities 921,026 1,441,853 917,910 1,501,035
Total assets 4,276,335 4,543,846 4,240,006 4,492,094
Total deposits 2,790,197 2,689,390 2,787,928 2,659,757
Other borrowings 1,108,734 1,491,636 1,079,295 1,467,904
Shareholders' equity 335,979 320,412 332,391 318,455
Asset Quality
Ratios(3)
----------------------
Past due loans over 30
days as a percentage
of loans 0.28 % 0.45 % 0.28 % 0.45 %
Allowance for loan
losses as a
percentage of loans 0.96 1.02 0.96 1.02
Allowance for loan
losses as a
percentage of
nonaccrual loans 380.27 294.50 380.27 294.50
Net charge-offs as a
percentage of average
loans-annualized 0.11 0.19 0.11 0.20
(1) Net interest income plus noninterest income.
(2) Noninterest expense less debt extinguishment expense and
derivative termination costs divided by the plus noninterest
income less gain (loss) on sale of securities on sale of
securities.
(3) Ratios exclude loans held for sale.
Commercial Lending is Catalyst catalyst, substance that can cause a change in the rate of a chemical reaction without itself being consumed in the reaction; the changing of the reaction rate by use of a catalyst is called catalysis. For Loan Growth First Charter continues to achieve strong loan growth. Total loan average balances increased $242.4 million, or 9 percent, to $3.03 billion compared to the same quarter a year ago. Commercial and construction loan average balances contributed $244.5 million of the increase, growing at a rate of 18 percent. Consumer loan average balances grew $14.6 million, or 2 percent. Mortgage loan average balances decreased $16.7 million, or 3 percent. The decline in mortgage loan balances is due, in part, to normal loan amortization and First Charter's strategy of selling most of its new mortgage production in the secondary market. Compared to the first quarter of 2006, total average loan balances grew $84.9 million, or 12 percent annualized, on the strength of $103.0 million of commercial and construction loan growth. Both consumer and mortgage loans declined in the quarter, with average loan balances falling $11.0 and $7.1 million, respectively. The decline in consumer loan balances was partly the result of customers refinancing Refinancing An extension and/or increase in amount of existing debt. adjustable rate Adjustable rate Applies mainly to convertible securities. Refers to interest rate or dividend that is adjusted periodically, usually according to a standard market rate outside the control of the bank or savings institution, such as that prevailing on Treasury bonds or notes. home equity loans into fixed rate first mortgage loans. "Our recent commercial loan growth is directly attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to our renewed re·new v. re·newed, re·new·ing, re·news v.tr. 1. To make new or as if new again; restore: renewed the antique chair. 2. focus on that line of business and the energy of the retooled commercial lending team over this period," said Bob James. "Investing in talented, self-motivated teammates who value long term relationships with their clients and who have strong ties to the community is paying off for us." Core Deposit Balances Continue to Build - Deposit Growth Comes Late in Second Quarter Deposit growth, particularly low-cost transaction (or core) deposit growth (money market, demand and savings accounts Savings Account A deposit account intended for funds that are expected to stay in for the short term. A savings account offers lower returns than the market rates. Notes: ), continues to be an area of emphasis at First Charter. Core deposit average balances increased $181.5 million, or 14 percent, compared to the second quarter of 2005. The increase was driven by a $122.9 million, or 28 percent, increase in money market average balances and a $40.0 million, or 10 percent, increase in noninterest bearing demand deposit average balances. Retail certificate of deposit (CD) average balances declined $74.9 million compared with the second quarter of 2005. Retail CD balances in the 2005 second quarter were positively impacted by an aggressively priced CD campaign dating to the fall of 2004. Among First Charter's efforts to improve its net interest margin, it refrained from aggressively repricing Repricing To change the price of an asset. In derivatives, it sometimes refers to the exchange of options of with different strike prices. repricing the large concentration of maturing CDs in the fall of 2005. This contributed to a decline in retail CD balances in the fourth quarter of 2005 and the decline in the year over year retail CD average balance comparison. Compared to the first quarter of 2006 core deposit average balances increased $12.6 million, or 4 percent annualized. The growth was concentrated in noninterest bearing demand deposits and NOW accounts. There was, however, significantly more deposit growth recognized late in the second quarter as evidenced by the $60 million, or 16 percent annualized, increase in period end core deposit balances between the first and second quarters of 2006. Additionally, retail CD balance growth also picked up in the latter half of the quarter. Looking at period end balances between the end of the first and second quarters of 2006, retail CD balances grew $94.6 million, or 43 percent annualized. The increase appeared to be largely driven by customer preferences for the higher yields offered by CDs relative to other bank deposit products at the time. Net Interest Margin Expands 33 Basis Points Over Year Ago Levels The net interest margin, on a tax equivalent basis, increased 33 basis points to 3.36 percent in the second quarter of 2006 from 3.03 percent for the second quarter of 2005. The margin improvement continues to benefit, in part, from the previously disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). October October: see month. 2005 balance sheet repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. . Net interest income on a tax equivalent basis increased to $33.2 million, representing a $1.3 million, or 4 percent, increase over the second quarter of 2005. Compared to the second quarter of 2005, earning asset Earning asset An asset that generates income, e.g., income from rental property. yields increased 119 basis points. This was driven by two factors. First, loan yields increased 113 basis points to 7.17 percent and securities yields increased 45 basis points to 4.37 percent. Second, the mix of higher yielding (loan) assets improved as a result of the balance sheet repositioning. The percentage of investment securities (which have lower yields than loans, on average) to total 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 was reduced from 33 percent to 22 percent over the past year. On the liability side of the balance sheet, the cost of interest bearing liabilities increased 104 basis points compared to the second quarter of 2005. This was comprised of a 98 basis point increase in interest bearing deposit costs to 3.11 percent while other borrowing costs increased 140 basis points to 4.88 percent. During this period, the Federal Reserve raised the rate at which banks can lend funds to each other (the Fed Funds fed funds See federal funds. rate) by 200 basis points. Also, as a result of the balance sheet repositioning, the percentage of higher-cost wholesale borrowings was reduced from 42 to 33 percent of total liabilities over the past year. The net interest margin during the quarter decreased 4 basis points from a net interest margin of 3.40 percent in the first quarter of 2006. Several factors contributed to the margin decline, including an apparent shift in deposit customer preferences towards higher yielding CDs at the expense of lower yielding transaction deposits, an uptick Uptick A transaction occurring at price above its previous transaction. In order for an uptick to occur, a transaction price must be followed by an increased transaction price. in competitive pricing pressure in regional deposits, and less consumer loan growth than anticipated. Compared to the first quarter of 2006, earning asset yields increased 22 basis points. This was driven by a 26 basis point increase in loan yields and a 6 basis point increase in securities yields. On the liability side of the balance sheet, interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid liabilities increased 32 basis points to 3.59 percent. This was primarily the result of a 36 basis point increase in other borrowing costs as a result of an increase in the fed funds rate and a 28 basis point increase in interest bearing deposit costs. Noninterest Income Noninterest income decreased $0.1 million, or less than 1 percent, to $17.2 million compared to the second quarter of 2005. The year over year comparison of noninterest income was impacted by several unique transactions which include: Bank Owned Life Insurance ("BOLI BOLI Bank-Owned Life Insurance BOLI Bureau of Labor and Industries ") claims of $0.9 million in the second quarter of 2005 versus none in the same quarter of 2006; $0.2 million of losses in the Corporation's SBIC/Venture Capital portfolio in the second quarter of 2005 versus marginal (jargon) marginal - 1. Extremely small. "A marginal increase in core can decrease GC time drastically." In everyday terms, this means that it is a lot easier to clean off your desk if you have a spare place to put some of the junk while you sort through it. 2. gains in the same quarter of 2006; and $0.2 million of gains on the sale of bank property in the second quarter of 2005 versus $0.1 million in the second quarter of 2006. Excluding these transactions, noninterest income increased $0.7 million, or 5 percent, compared to the second quarter of 2005. This improvement was primarily due to a $0.4 million increase in service charges resulting from increased NSF NSF - National Science Foundation volume, a $0.4 million increase 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 merchant income as a result of increased transaction volume and a $0.1 million increase in mortgage loan fees. Insurance and brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. revenues declined $0.2 million and $0.1 million, respectively. Noninterest income decreased $1.0 million, or 5 percent, compared to the first quarter of 2006. The decline was primarily due to a $1.4 million decrease in insurance revenues as a result of seasonal factors and a $0.5 million gain in the Corporation's SBIC/Venture Capital portfolio in the first quarter of 2006 versus marginal gains in the second quarter. The decline was partially offset by a $0.8 million increase in service charges and a $0.2 million increase in ATM, debit card and merchant income. Raleigh Growth Update In October 2005 and mid-February n. 1. the middle part of February. Noun 1. mid-February - the middle part of February period, period of time, time period - an amount of time; "a time period of 30 years"; "hastened the period of time of his recovery"; "Picasso's blue 2006, the Corporation expanded into the Raleigh, North Carolina For other uses of this name, see Raleigh. Raleigh (IPA: /ˈrɑli/, ral-ee) is the capital of the State of North Carolina and the county seat of Wake County. market with one and three de novo financial centers, respectively. As previously disclosed, the expenses associated with the Raleigh initiative are front-end loaded Front-End Load A commission or sales fee charged at the time of the initial purchase for an investment, usually mutual funds and insurance policies. It is deducted from the investment amount and thus, lowers the size of the investment. and will be ahead of revenues during 2006. "Our early experience in Raleigh has validated val·i·date tr.v. val·i·dat·ed, val·i·dat·ing, val·i·dates 1. To declare or make legally valid. 2. To mark with an indication of official sanction. 3. our belief in the potential of this high growth market," James commented. "While it will take us a while to become well-known well-known adj. 1. Widely known; familiar or famous: a well-known performer. 2. Fully known: well-known facts. throughout the region, our Raleigh team is working hard to position First Charter as a strong banking option for individuals and businesses." For the second quarter of 2006, Raleigh-related expenses, including marketing expenses, were $1.4 million versus revenues and transfer-priced net income (net of loan loss provision) of $0.2 million. This negatively impacted EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. by 2.5 cents during the quarter. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. Raleigh-related expenses were $2.5 million versus revenues of $0.4 million. This negatively impacted EPS by 4.6 cents on a year-to-date basis. During the second quarter, total loans in the Raleigh market grew $39.3 million to $81.2 million, exceeding growth expectations. During the same period, deposits grew $26.6 million totaling $30.0 million at June June: see month. 30, 2006. "Our stronger than anticipated loan growth in Raleigh has actually accelerated some of our start-up Start-up The earliest stage of a new business venture. costs, primarily due to the additional loan loss provision immediately required to support the loan growth," James commented. "Over time, spread income will more than offset this." Noninterest Expense Impacted by Raleigh Initiative and Personnel Costs Noninterest expense increased $2.1 million to $31.4 million compared to the second quarter of 2005. Of this, $1.5 million is attributable to expenses related to First Charter's Raleigh investments and the recent opening of a de novo branch in South Charlotte. Salaries and employee benefits increased $0.9 million compared to the second quarter of 2005, of which $0.7 million is due to additional personnel in the Raleigh market and the Charlotte de novo branch. Expenses associated with equity-based compensation (FAS 123R) totaled $0.6 million, while increased commission-based compensation contributed $0.4 million toward the increase in salary and employee benefits. These increases were partially offset by a $1.1 million expense associated with a legacy employee benefit plan in the second quarter of 2005, which did not recur in 2006. Professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. increased $0.3 million, data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a increased $0.2 million as a result of increased ATM and debit A monetary amount that is subtracted from an account balance. A debit from one account is a credit to another. See credit. transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). , and occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy and equipment expense increased $0.2 million due to additional financial center lease and depreciation costs, of which $0.3 million were related to additional Raleigh financial centers and the Charlotte de novo branch. Noninterest expense decreased $0.1 million, or less than 1 percent, compared to the first quarter of 2006. Salaries and employee benefits decreased $0.9 million due to lower medical costs and lower employee benefit expenses. This was partially offset by increased professional fees and foreclosed properties expense. Strong Credit Quality Credit quality continues to be very strong with net charge-offs only 0.11 percent of average loans in the second quarter of 2006 compared to 0.19 percent in the same quarter a year ago. 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. totaled $13.7 million at June 30, 2006, representing a $2.6 million decrease from a year ago and a $2.3 million decrease from December December: see month. 31, 2005. Nonperforming assets as a percentage of total loans and 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 decreased to 0.44 percent at June 30, 2006 compared to 0.57 percent at June 30, 2005 and 0.54 percent at December 31, 2005. The allowance for loan losses as a percent of total loans was 0.96 percent at June 30, 2006, a decrease from 0.98 at December 31, 2005 and a decrease from 1.02 percent in the same quarter a year ago. The provision for loan losses was $0.9 million for the three months ended June 30, 2006, equal to net charge-offs for the period. For the same year ago period, the provision for loan losses was $2.9 million and net charge-offs were $1.3 million. The lower allowance for loan loss ratio and the reduction in the provision expense are related to the Corporation's improved credit quality trends. Customer Satisfaction Second quarter results from our Customer Satisfaction Survey indicated that 84 percent of our customers were "Very Satisfied" with the "Expect More" service they received from our teammates in the financial centers. "Very Satisfied" customers are more likely to consolidate Consolidate To combine the assets, liabilities, and other financial items of two or more entities into one. Notes: This term is generally used in the context of consolidated financial statements. their business at First Charter, recommend us to their friends and family, and look to us for financial solutions in the future. Conference Call The First Charter executive management team will be available via telephone conference to discuss the contents of this press release on Tuesday Tuesday: see week. , July July: see month. 25, 2006 at 10:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . Slides designed to accompany To go along with; to go with or to attend as a companion or associate. A motor vehicle statute may require beginning drivers or drivers under a certain age to be accompanied by a licensed adult driver whenever operating an automobile. the presentation will be available after 6:00 p.m. EDT on Monday Monday: see week. , July 24, 2006 on the Corporation's web site, www.firstcharter.com. 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 # 2646631 ID # 2646631
------------------------------------------------- --------------------
Internet Live and Replay www.FirstCharter.com www.FirstCharter.com
"Investor Relations" "Investor Relations"
section section
------------------------------------------------- --------------------
Audio Replay 800-642-1687 706-645-9291
ID # 2646631 ID # 2646631
Corporate Profile First Charter Corporation is a regional financial services company with assets of approximately $4.4 billion and is the holding company for First Charter Bank. First Charter operates 58 financial centers, four insurance offices and 137 ATMs located throughout 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 loan origination The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. offices in Asheville, North Carolina Not to be confused with Ashville. Asheville is a city in Buncombe County, North Carolina, and is its county seat. As of the 2000 census, the city had a total population of 68,889. It is the largest city in western North Carolina, and continues to grow. and Reston, Virginia Reston is an internationally known planned community whose goal was to revolutionize post-World War II concepts of land use and residential/corporate development in American suburbia. . 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 , wealth management, investments, insurance, mortgages and a broad array of employee benefit programs. Additional information about First Charter may 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 Global Select. 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, and which may be beyond the Corporation's control, include, among others, the following possibilities: (1) projected results in connection with management's implementation of, or changes in, the Corporation's business plan and strategic initiatives, including the recent balance sheet initiatives, are lower than expected; (2) competitive pressure among financial services companies increases significantly; (3) costs or difficulties related to the integration of acquisitions, including deposit attrition Attrition The reduction in staff and employees in a company through normal means, such as retirement and resignation. This is natural in any business and industry. Notes: , customer retention and revenue loss, 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, or interest rate policies of the Board of Governors of the Federal Reserve System Board of Governors of the Federal Reserve System The managing body of the Federal Reserve System, which sets policies on bank practices and the money supply. , may 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. , including changes in accounting standards, may 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; (10) the passage of future tax legislation, or any negative regulatory, administrative or judicial position, may adversely impact the Corporation; (11) the Corporation's competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. may have greater financial resources and may develop products that enable them to compete more successfully in the markets in which it operates; and (12) changes in the securities markets, including changes in interest rates, may adversely affect the Corporation's ability to raise capital from time to time.
First Charter Corporation (NASDAQ:FCTR)
and Subsidiaries
Quarterly Earnings Release
As of / For the Six
Months Ended Increase (Decrease)
-----------------------------------------
(Dollars in thousands,
except per share data) 6/30/06 6/30/05 Amount Percentage
---------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due from
banks $ 115,557 $ 104,886 $ 10,671 10.2 %
Federal funds sold 2,347 2,250 97 4.3
Interest earning bank
deposits 13,432 3,167 10,265 324.1
Securities available
for sale 884,370 1,412,885 (528,515) (37.4)
Loans held for sale 8,382 8,159 223 2.7
Loans
Commercial Real Estate 885,981 785,718 100,263 12.8
Commercial Non Real
Estate 220,433 219,029 1,404 0.6
Construction 584,094 444,125 139,969 31.5
Mortgage 557,338 581,257 (23,919) (4.1)
Consumer 355,815 328,163 27,652 8.4
Home equity 468,685 500,080 (31,395) (6.3)
-----------------------------------------
Total loans 3,072,346 2,858,372 213,974 7.5
Less: Unearned income (58) (213) 155 (72.8)
Allowance for loan
losses (29,520) (29,032) (488) 1.7
-----------------------------------------
Loans, net 3,042,768 2,829,127 213,641 7.6
-----------------------------------------
Other assets 296,418 272,762 23,656 8.7
-----------------------------------------
Total assets $4,363,274 $4,633,236 $(269,962) (5.8)%
-----------------------------------------
LIABILITIES AND
SHAREHOLDERS' EQUITY:
Deposits
Noninterest-bearing
deposits $ 449,732 $ 406,982 $ 42,750 10.5 %
Interest checking and
savings 508,587 475,643 32,944 6.9
Money market deposits 611,886 440,117 171,769 39.0
Retail certificates of
deposit 972,395 994,671 (22,276) (2.2)
Wholesale certificates
of deposit 446,202 433,972 12,230 2.8
-----------------------------------------
Total deposits 2,988,802 2,751,385 237,417 8.6
Other borrowings
Retail other
borrowings 102,839 118,557 (15,718) (13.3)
Wholesale short-term other
borrowings 250,041 637,445 (387,404) (60.8)
Wholesale long-term other
borrowings 642,827 747,320 (104,493) (14.0)
-----------------------------------------
Total other borrowings 995,707 1,503,322 (507,615) (33.8)
Other liabilities 41,830 50,831 (9,001) (17.7)
-----------------------------------------
Total liabilities 4,026,339 4,305,538 (279,199) (6.5)
-----------------------------------------
Total shareholders'
equity 336,935 327,698 9,237 2.8
-----------------------------------------
Total liabilities and
shareholders' equity $4,363,274 $4,633,236 $(269,962) (5.8)%
-----------------------------------------
---------------------------------------------------------------------
SELECTED AVERAGE
BALANCES
Loans and loans held
for sale $2,988,596 $2,670,810 $ 317,786 11.9 %
Securities 917,910 1,501,035 (583,125) (38.8)
Interest earning
assets 3,914,969 4,179,587 (264,618) (6.3)
Assets 4,240,006 4,492,094 (252,088) (5.6)
Noninterest bearing
deposits 420,364 380,421 39,943 10.5
Interest checking and
savings 482,309 459,101 23,208 5.1
Money market deposits 568,263 471,955 96,308 20.4
Retail certificates of
deposit 900,400 969,822 (69,422) (7.2)
Wholesale certificates
of deposit 416,592 356,057 60,535 17.0
Deposits 2,787,928 2,659,757 128,171 4.8
Other borrowings 1,079,295 1,467,904 (388,609) (26.5)
Interest bearing
liabilities 3,446,859 3,747,241 (300,382) (8.0)
Shareholders' equity 332,391 318,455 13,936 4.4
---------------------------------------------------------------------
As of / For the Quarter Ended
---------------------------------------------------
6/30/06 3/31/06 12/31/05 9/30/05
---------------------------------------------------
MISCELLANEOUS
INFORMATION
Common stock
prices (daily
close)
High $ 25.38 $ 25.05 $ 26.66 $ 25.73
Low 23.51 23.28 22.34 22.25
End of period 24.53 24.70 23.66 24.48
Book Value 10.83 10.77 10.53 10.82
Tangible Book
Value 10.36 10.30 10.06 10.35
Market
Capitalization 763,383,927 765,059,628 727,235,906 749,010,521
Weighted average
shares - basic 31,058,858 30,859,461 30,678,743 30,575,440
Weighted average
shares - diluted 31,339,325 31,153,338 30,678,743 30,891,887
End of period
shares
outstanding 31,120,421 30,974,074 30,736,936 30,596,835
----------------------------------------------------------------------
As of / For
the Quarter
Ended
-------------
6/30/05
-------------
MISCELLANEOUS INFORMATION
Common stock prices (daily close)
High $ 23.34
Low 20.85
End of period 21.97
Book Value 10.73
Tangible Book Value 10.25
Market Capitalization 670,822,115
Weighted average shares - basic 30,409,307
Weighted average shares - diluted 30,679,636
End of period shares outstanding 30,533,551
----------------------------------------------------------------------
First Charter Corporation
and Subsidiaries (NASDAQ: FCTR)
Quarterly Earnings Release
As of / For the Quarter Ended
-------------------------------------------------------
(Dollars in
thousands,
except per
share data) 6/30/06 3/31/06 12/31/05 9/30/05 6/30/05
----------------------------------------------------------------------
BALANCE SHEET
ASSETS:
Cash and due
from banks $ 115,557 $ 95,382 $ 119,080 $ 123,489 $ 104,886
Federal funds
sold 2,347 2,706 2,474 1,997 2,250
Interest
earning bank
deposits 13,432 3,745 3,998 5,885 3,167
Securities
available for
sale 884,370 900,424 899,111 1,374,163 1,412,885
Loans held for
sale 8,382 8,719 6,447 7,309 8,159
Loans
Commercial
Real Estate 885,981 820,318 780,597 795,362 785,718
Commercial Non
Real Estate 220,433 213,338 233,409 227,762 219,029
Construction 584,094 583,288 517,392 484,911 444,125
Mortgage 557,338 565,166 573,007 582,673 581,257
Consumer 355,815 355,636 358,592 346,772 328,163
Home equity 468,685 473,342 482,921 492,881 500,080
-------------------------------------------------------
Total loans 3,072,346 3,011,088 2,945,918 2,930,361 2,858,372
Less: Unearned
income (58) (125) (173) (216) (213)
Allowance for
loan losses (29,520) (29,505) (28,725) (29,788) (29,032)
-------------------------------------------------------
Loans, net 3,042,768 2,981,458 2,917,020 2,900,357 2,829,127
-------------------------------------------------------
Other assets 296,418 290,922 284,290 286,522 272,762
-------------------------------------------------------
Total assets $4,363,274 $4,283,356 $ 4,232,420 $4,699,722 $4,633,236
-------------------------------------------------------
LIABILITIES AND
SHAREHOLDERS'
EQUITY:
Deposits
Noninterest-
bearing
deposits $ 449,732 $ 422,184 $ 429,758 $ 420,531 $ 406,982
Interest
checking and
savings 508,587 500,392 488,115 481,293 475,643
Money market
deposits 611,886 587,516 559,865 580,312 440,117
Retail
certificates
of deposit 972,395 877,769 916,569 938,871 994,671
Wholesale
certificates
of deposit 446,202 412,485 405,172 451,986 433,972
-------------------------------------------------------
Total deposits 2,988,802 2,800,346 2,799,479 2,872,993 2,751,385
Other borrowings
Retail other
borrowings 102,839 121,740 170,094 116,562 118,557
Wholesale
short-term
other
borrowings 250,041 339,201 340,620 502,821 637,445
Wholesale
long-term
other
borrowings 642,827 642,843 557,859 819,005 747,320
-------------------------------------------------------
Total other
borrowings 995,707 1,103,784 1,068,573 1,438,388 1,503,322
Other
liabilities 41,830 45,599 40,772 57,296 50,831
-------------------------------------------------------
Total
liabilities 4,026,339 3,949,729 3,908,824 4,368,677 4,305,538
-------------------------------------------------------
Total
shareholders'
equity 336,935 333,627 323,596 331,045 327,698
-------------------------------------------------------
Total
liabilities
and
shareholders'
equity $4,363,274 $4,283,356 $ 4,232,420 $4,699,722 $4,633,236
-------------------------------------------------------
----------------------------------------------------------------------
SELECTED
AVERAGE
BALANCES
Loans and
loans held
for sale $3,030,815 $2,945,908 $ 2,932,195 $2,904,954 $2,788,438
Securities 921,026 914,759 1,028,477 1,420,033 1,441,853
Interest
earning
assets 3,960,835 3,868,518 3,969,620 4,331,780 4,236,232
Assets 4,276,335 4,203,273 4,303,821 4,665,301 4,543,846
Noninterest
bearing
deposits 427,923 412,720 424,118 417,013 387,898
Interest
checking and
savings 488,276 476,275 469,594 469,283 469,752
Money market
deposits 561,005 575,601 581,324 495,401 438,065
Retail
certificates
of deposit 906,672 894,059 930,395 993,352 981,600
Wholesale
certificates
of deposit 406,322 426,977 433,135 437,116 412,075
Deposits 2,790,197 2,785,633 2,838,566 2,812,165 2,689,390
Other
borrowings 1,108,734 1,049,529 1,099,350 1,471,482 1,491,636
Interest
bearing
liabilities 3,471,008 3,422,441 3,513,797 3,866,634 3,793,128
Shareholders'
equity 335,979 328,763 323,753 328,115 320,412
----------------------------------------------------------------------
First Charter Corporation (NASDAQ: FCTR)
and Subsidiaries
Quarterly Earnings Release
For the Three Months Ended Increase (Decrease)
----------------------------------------------
(Dollars in thousands,
except per share data) 6/30/06 6/30/05 Amount Percentage
---------------------------------------------------------------------
INCOME STATEMENT
Interest income - taxable
equivalent $ 64,318 $ 56,199 $ 8,119 14.4 %
Interest expense 31,095 24,314 6,781 27.9
-------------------------------------------
Net interest income -
taxable equivalent 33,223 31,885 1,338 4.2
Less: taxable equivalent
adjustment 576 595 (19) (3.2)
-------------------------------------------
Net interest income 32,647 31,290 1,357 4.3
Provision for loan losses 880 2,878 (1,998) (69.4)
-------------------------------------------
Net interest income
after provision for
loan losses 31,767 28,412 3,355 11.8
Noninterest income 17,240 17,317 (77) (0.4)
Noninterest expense 31,436 29,364 2,072 7.1
-------------------------------------------
Income before income
taxes 17,571 16,365 1,206 7.4
Income tax expense 6,025 5,085 940 18.5
-------------------------------------------
Net income $ 11,546 $ 11,280 $ 266 2.4 %
-------------------------------------------
---------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 0.37 $ 0.37 $ - - %
Diluted 0.37 0.37 - -
Weighted average shares -
basic 31,058,858 30,409,307
Weighted average shares -
diluted 31,339,325 30,679,636
Dividends paid on common
shares $ 0.190 $ 0.190 $ - - %
---------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average assets 1.08 % 1.00 %
Return on average equity 13.78 14.12
Efficiency - taxable
equivalent (a) 62.33 59.70
---------------------------------------------------------------------
For the Three Months
Ended
---------------------
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS 6/30/06 6/30/05
---------------------
Noninterest income
Gain on sale of securities $ 32 $ 18
Equity method investment gain (loss) 11 (174)
Gain on sale of properties 107 188
Bank owned life insurance payment - 925
Noninterest expense
Employee benefit plan modification - 1,079
----------------------------------------------------------------------
Notes:Applicable ratios are annualized.
(a) - Noninterest expense less debt extinguishment expense and
derivative termination costs divided by the sum of
taxable equivalent net interest income plus noninterest
income less gain (loss) on sale of securities.
First Charter Corporation (NASDAQ: FCTR)
and Subsidiaries
Quarterly Earnings Release
Increase
For the Six Months Ended (Decrease)
-------------------------------------------
(Dollars in thousands,
except per share data) 6/30/06 6/30/05 Amount Percentage
---------------------------------------------------------------------
INCOME STATEMENT
Interest income -
taxable equivalent $ 124,550 $ 108,056 $16,494 15.3 %
Interest expense 58,651 45,022 13,629 30.3
-------------------------------------------
Net interest income -
taxable equivalent 65,899 63,034 2,865 4.5
Less: taxable
equivalent
adjustment 1,162 1,170 (8) (0.7)
-------------------------------------------
Net interest
income 64,737 61,864 2,873 4.6
Provision for loan
losses 2,399 4,778 (2,379) (49.8)
-------------------------------------------
Net interest
income after
provision for
loan losses 62,338 57,086 5,252 9.2
Noninterest income 35,481 33,131 2,350 7.1
Noninterest expense 62,948 58,233 4,715 8.1
-------------------------------------------
Income before income
taxes 34,871 31,984 2,887 9.0
Income taxes 11,881 10,395 1,486 14.3
-------------------------------------------
Net income $ 22,990 $ 21,589 $ 1,401 6.5 %
-------------------------------------------
---------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 0.74 $ 0.71 $ 0.03 4.2 %
Diluted 0.74 0.71 0.03 4.2
Weighted average
shares - basic 30,959,711 30,285,244
Weighted average
shares - diluted 31,249,049 30,607,931
Dividends paid on
common shares $ 0.38 $ 0.38 $ - - %
---------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average
assets 1.09 % 0.97 %
Return on average
equity 13.95 13.67
Efficiency - taxable
equivalent (b) 62.11 60.54
---------------------------------------------------------------------
For the Six Months
Ended
---------------------
SCHEDULE OF SELECTED ITEMS INCLUDED IN EARNINGS 6/30/06 6/30/05
---------------------
Noninterest income
Gain (loss) on sale of securities $32 $(31)
Equity method investment gain (loss) 556 (232)
Gain on sale of properties 188 717
Bank owned life insurance payment - 925
Noninterest expense
Employee benefit plan modification - 1,079
Separation agreement - 1,010
Financial management charge - 166
----------------------------------------------------------------------
Notes: Applicable ratios are annualized.
(b) - Noninterest expense less debt extinguishment expense and
derivative termination costs divided by the sum of
taxable equivalent net interest income plus noninterest income
less gain (loss) on sale of securities.
First Charter Corporation
and Subsidiaries (NASDAQ:FCTR)
Quarterly Earnings
Release
As of / For the Quarter Ended
----------------------------------------------
(Dollars in thousands,
except per share data) 6/30/06 3/31/06 12/31/05 9/30/05 6/30/05
---------------------------------------------------------------------
INCOME STATEMENT
Interest income -
taxable equivalent
Interest and fees on
loans $ 54,167 $ 50,306 $ 48,505 $ 45,941 $ 42,016
Interest on securities 10,054 9,852 10,646 13,660 14,145
Other interest income 97 75 80 53 38
---------------------------------------------
Total interest income -
taxable equivalent 64,318 60,233 59,231 59,654 56,199
---------------------------------------------
Interest expense
Interest on deposits 18,343 16,562 16,245 14,487 12,210
Other interest expense 12,752 10,994 10,465 13,503 12,104
---------------------------------------------
Total interest expense 31,095 27,556 26,710 27,990 24,314
---------------------------------------------
Net interest income -
taxable equivalent 33,223 32,677 32,521 31,664 31,885
Less: Taxable
equivalent adjustment 576 586 592 574 595
---------------------------------------------
Net interest income 32,647 32,090 31,929 31,090 31,290
Provision for loan
losses 880 1,519 1,795 2,770 2,878
---------------------------------------------
Net interest income
after provision for
loan losses 31,767 30,571 30,134 28,320 28,412
---------------------------------------------
Noninterest income
Service charges on
deposit accounts 7,469 6,698 7,191 7,321 7,061
Wealth management
income 1,535 1,664 1,366 1,358 1,596
Gain (loss) on sale of
securities 32 - (16,671) 12 18
Gain (loss) from equity
method investments 11 545 (68) 29 (174)
Mortgage loan fees 916 808 789 873 817
Brokerage services
income 692 711 636 888 793
Insurance services
income 2,857 4,290 2,953 2,796 3,099
Bank owned life
insurance 850 827 859 863 1,762
Gain on sale of
properties 107 81 571 566 188
ATM & merchant income 2,117 1,898 1,810 1,723 1,719
Other noninterest
income 654 719 603 614 438
---------------------------------------------
Total noninterest
income 17,240 18,241 39 17,043 17,317
---------------------------------------------
Noninterest expense
Salaries and employee
benefits 16,824 17,693 16,217 15,901 15,908
Occupancy and equipment 4,887 4,770 3,395 4,344 4,687
Data processing 1,491 1,453 1,412 1,310 1,333
Marketing 1,196 1,288 1,447 1,076 1,065
Postage and supplies 1,328 1,231 1,172 1,092 1,187
Professional services 2,305 1,950 2,299 2,064 1,984
Telephone 528 579 578 537 551
Amortization of
intangibles 154 150 152 129 126
Debt extinguishment
expense - - 6,884 - -
Derivative termination
costs - - 7,770 - -
Other noninterest
expense 2,723 2,398 2,720 2,490 2,523
---------------------------------------------
Total noninterest
expense 31,436 31,512 44,046 28,943 29,364
---------------------------------------------
Income before taxes 17,571 17,300 (13,873) 16,420 16,365
Income tax expense 6,025 5,856 (5,543) 4,368 5,085
---------------------------------------------
Net income $ 11,546 $ 11,444 $ (8,330)$ 12,052 $ 11,280
---------------------------------------------
---------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic $ 0.37 $ 0.37 $ (0.27)$ 0.39 $ 0.37
Diluted 0.37 0.37 (0.27) 0.39 0.37
Dividends paid on
common shares 0.190 0.190 0.190 0.190 0.190
---------------------------------------------------------------------
PERFORMANCE RATIOS
Return on average
assets 1.08 % 1.10 % (0.77)% 1.02 % 1.00 %
Return on average
equity 13.78 14.12 (10.21) 14.57 14.12
Efficiency - taxable
equivalent (c) 62.33 61.89 59.70 59.44 59.70
Noninterest income as a
percentage of total
income 34.56 36.24 0.12 35.41 35.63
Equity as a percentage
of total assets 7.72 7.79 7.65 7.04 7.07
Tangible equity as a
percentage of total
assets 7.20 7.26 7.10 6.58 6.58
Tier 1 Capital to Risk
Adjusted Assets 11.17 11.22 11.20 11.37 10.70
Total Capital to Risk
Adjusted Assets 12.02 12.08 12.06 12.25 11.58
---------------------------------------------------------------------
As of / For the Quarter Ended
---------------------------------------------
SCHEDULE OF SELECTED
ITEMS INCLUDED IN
EARNINGS 6/30/06 3/31/06 12/31/05 9/30/05 6/30/05
---------------------------------------------
Noninterest income
Gain (loss) on sale of
securities $32 $- $(16,671) $12 $18
Equity method
investment gain (loss) 11 545 (68) 29 (174)
Gain on sale of
properties 107 81 571 566 188
Bank owned life
insurance payment - - - - 925
Noninterest expense
Employee benefit plan
modification - - - - 1,079
Fixed asset adjustment - - (1,386) - -
Prepayment costs on
borrowings - - 6,884 - -
Derivative termination
costs - - 7,770 - -
Notes: Applicable ratios are annualized.
(c) - Noninterest expense less debt extinguishment expense and
derivative termination costs divided by the sum of
taxable equivalent net interest income plus
noninterest income less gain (loss) on sale of securities.
First Charter Corporation and (NASDAQ: FCTR)
Subsidiaries
Quarterly Earnings Release
As of / For the Quarter Ended
--------------------------------------------------
(Dollars in
thousands, except
per share data) 6/30/06 3/31/06 12/31/05 9/30/05 6/30/05
---------------------------------------------------------------------
ASSET QUALITY
ANALYSIS
Allowance for Loan
Losses
Beginning balance $ 29,505 $ 28,725 $ 29,788 $ 29,032 $ 27,483
Provision for loan
losses 880 1,519 1,795 2,770 2,878
Charge-offs (1,135) (1,229) (3,021) (2,197) (1,516)
Recoveries 270 490 163 183 187
--------------------------------------------------
Net charge-offs (865) (739) (2,858) (2,014) (1,329)
--------------------------------------------------
Ending balance $ 29,520 $ 29,505 $ 28,725 $ 29,788 $ 29,032
--------------------------------------------------
Nonperforming
Assets and Loans
90 days or more
past due accruing
interest
Nonaccrual loans $ 7,763 $ 9,211 $ 10,811 $ 7,071 $ 9,858
Other real estate 5,902 6,072 5,124 6,079 6,390
--------------------------------------------------
Total
nonperforming
assets 13,665 15,283 15,935 13,150 16,248
--------------------------------------------------
Loans 90 days or
more past due
accruing interest - - - - -
--------------------------------------------------
Total $ 13,665 $ 15,283 $ 15,935 $ 13,150 $ 16,248
--------------------------------------------------
Asset Quality
Ratios (d)
Nonaccrual loans
as a percentage
of total loans 0.25 % 0.31 % 0.37 % 0.24 % 0.34 %
Nonperforming
assets as a
percentage of
total assets 0.31 0.36 0.38 0.28 0.35
Nonperforming
assets as a
percentage of
total loans and
other real estate 0.44 0.51 0.54 0.45 0.57
Net charge-offs as
a percentage of
average loans
(annualized) 0.11 0.10 0.39 0.28 0.19
Allowance for loan
losses as a
percentage of
loans 0.96 0.98 0.98 1.02 1.02
Ratio of allowance
for loan losses
to:
Net charge-offs
(annualized) 8.51 x 9.84 x 2.53 x 3.73 x 5.45 x
Nonaccrual loans 3.80 3.20 2.66 4.21 2.95
---------------------------------------------------------------------
As of / For the Six
Months Ended Increase (Decrease)
--------------------------------------------
6/30/06 6/30/05 Amount Percentage
---------------------------------------------------------------------
Allowance for Loan Losses
Beginning balance $ 28,725 $ 26,872 $ 1,853 6.9 %
Provision for loan losses 2,399 4,778 (2,379) (49.8)
Charge-offs (2,364) (3,434) (1,070) (31.2)
Recoveries 760 816 (56) (6.9)
-------------------------------------------
Net charge-offs (1,604) (2,618) (1,014) (38.7)
-------------------------------------------
Ending balance $ 29,520 $ 29,032 $ 488 1.7 %
-------------------------------------------
Asset Quality Ratios (d)
Net charge-offs as a
percentage of average loans 0.11 % 0.20 %
Ratio of allowance for
loan losses to net
charge-offs 9.13 x 5.50 x
---------------------------------------------------------------------
For the Quarter Ended
---------------------------------------------
6/30/06 3/31/06 12/31/05 9/30/05 6/30/05
---------------------------------------------------------------------
ANNUALIZED INTEREST
YIELDS / RATES (d)
Interest income:
Yield on loans and
loans held for sale 7.17 % 6.91 % 6.57 % 6.28 % 6.04 %
Yield on securities 4.37 4.31 4.16 3.84 3.92
---------------------------------------------
Yield on interest
earning assets 6.51 6.29 5.93 5.48 5.32
---------------------------------------------
Interest expense:
Cost of interest
bearing deposits 3.11 2.83 2.67 2.40 2.13
Other borrowings
Cost of retail
borrowings 2.81 2.44 1.88 1.80 1.46
Cost of wholesale
borrowings 4.88 4.50 3.99 3.82 3.40
----------------------------------------------
Cost of total
borrowings 4.61 4.25 3.78 3.64 3.21
----------------------------------------------
Cost of interest
bearing liabilities 3.59 3.27 3.02 2.87 2.55
---------------------------------------------
Interest rate spread 2.92 3.02 2.91 2.61 2.77
---------------------------------------------
Net yield on earning
assets 3.36 % 3.40 % 3.27 % 2.92 % 3.03 %
---------------------------------------------
---------------------------------------------------------------------
Notes:Applicable ratios are annualized.
(d) - Excludes loans held for sale.
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