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IRWIN FINANCIAL CORPORATION ANNOUNCES SECOND QUARTER EARNINGS UP 70 PERCENT

 IRWIN FINANCIAL CORPORATION
 ANNOUNCES SECOND QUARTER EARNINGS UP 70 PERCENT
 COLUMBUS, Ind., July 16 /PRNewswire/ -- Irwin Financial Corporation (NASDAQ: IRWN) today announced second quarter earnings of $2,458,542 or $1.71 per share, an increase of 70.1 percent over 1991's second quarter results of $1,445,391 or $1.03 per share. Year to date, the corporation has earned $5,125,107 or $3.57 per share, compared to $2,733,408 or $1.94 per share in 1991, an increase of 87.5 percent. Improved results at all four of the corporation's principal operating companies contributed to the strong performance.
 Record levels of mortgage loan closings, a favorable interest rate environment, and increases in servicing income at Inland Mortgage Corporation were the primary reasons for the quarterly earnings growth. Mortgage closings at Inland reached $821 million, up 50.6 percent over the same quarter in 1991. The record loan volumes also contributed to increased net interest income for the quarter at Inland, which improved $1.8 million from the second quarter of 1991. Mortgage loan originatting gains" that Inland experienced in the second quarter. Marketing gains are created when pools of mortgage loans produced by the company are sold into the secondary market at a profit. These marketing gains contributed 30.0 percent of the total improvement in origination income.
 In the current attractive environment for mortgage banking, Irwin Financial is realizing returns at Inland Mortgage that exceed its long-term target rate of return. These profits allowed Inland to retain the servicing rights on a larger percentage of its mortgage loan production than it has in earlier years. The company was thus able to grow its servicing portfolio $0.7 billion during the second quarter, an increase representing approximately 85 percent of mortgage loan production for the period. Compared to the same period in 1991, income from the sale of servicing rights in the second quarter declined 57.3 percent, while servicing fee income increased 74.6 percent. The servicing portfolio ended the quarter at $4.2 billion, up 82.6 percent from $2.3 billion at June 30, 1991.
 Irwin Union Bank also contributed to the strong financial performance for the quarter, with net income increasing 9.3 percent from the previous year. The bank's net interest income grew 17.4 percent before the provision for loan losses, benefitting from both asset growth and an improvement in net interest margin. The bank averaged $406 million in assets for the second quarter of 1992, compared to an average of $371 million for the second quarter of 1991.
 Other expense for the second quarter of 1992 was up $6.1 million or 48.5 percent from the same period in 1991. The increase is primarily due to continued growth in employee salaries and benefits and other operating expenses at Inland Mortgage necessary to support the 50.6 percent growth in mortgage loan closings and 82.6 percent growth in the servicing portfolio.
 Total assets of Irwin Financial Corporation were $637 million as of June 30, 1992, an increase of 16.1 percent over year-earlier figures. Of the total, $298 million or 46.8 percent were mortgage loans held for sale in the secondary markets. These high-quality assets remain on the corporation's balance sheet approximately 40 days on average. As a result, total assets at the end of a quarter are heavily influenced by closing volumes within the last 40 days of the quarter. The surge in refinancing volumes in March pushed Irwin Financial's total assets at the end of the first quarter of 1992 to $711 million. The quarter-to-quarter decline in assets this year reflects the more even volume of mortgage loan closings throughout the second quarter.
 As of June 30, 1992, shareholders' equity was $47.6 million or $33.42 per share, a 22.6 percent increase over the $38.8 million or $27.64 per share on the same date in 1991. The annualized return on average equity for the second quarter was 21.3 percent. The ratio of equity to assets at the end of the second quarter was 7.47 percent, compared to 6.36 percent at the end of the first quarter and 7.07 percent at June 30, 1991.
 Total nonperforming loans increased from $1.2 million, or 0.63 percent of loans at the end of the first quarter, to $3.4 million, or 1.71 percent of loans at the end of the second quarter. The increase was due to two commercial loans at Irwin Union Bank totalling $2.3 million which deteriorated in the second quarter and were placed on non-accrual status. The bank's loan loss provision in the second quarter was $490,000, an increase of 50.8 percent over the same period a year earlier.
 During the second quarter, it was determined that certain assets should be reclassified from "other assets" into the category of "other real estate owned." As a result, other real estate owned increased from $0.2 million at the end of the first quarter to $1.3 million at the end of the second quarter. The reclassified assets consist of foreclosed residential properties at Inland Mortgage connected with uninsured loans. Of the $2.1 million total of these loans, Inland has previously reserved $1.0 million against losses on the sale of these properties.
 The combination of increases in nonperforming loans and other real estate owned brought nonperforming assets to $4.6 million or 0.73 percent of total assets, up from $1.4 million or 0.19 percent of total assets as reported at the end of the first quarter. This percentage is still well below peer averages.
 The total allowance for loan losses at the end of the second quarter was $3.0 million, up 49.9 percent from $2.0 million in 1991. This represented 1.52 percent of total loans compared to 1.19 percent last year.
 Irwin Financial's other principal operating companies, Irwin Union Investor Services and Affiliated Capital Corp., also contributed to the consolidated improvement in results. Irwin Union Investor Services, which offers investment management and securities brokerage services, increased fee income 26.8 percent year-to-year in the second quarter. Continuing growth in new lease volume at Affiliated Capital caused total revenue to increase 111.1 percent over the second quarter of last year.
 Irwin Financial Corporation is an interrelated group of financial services companies serving niche markets, headquartered in Columbus, Ind. The corporation, through its four principal operating subsidiaries -- Irwin Union Bank and Trust Company, Inland Mortgage Corporation, Irwin Union Investor Services, and Affiliated Capital Corp. -- provides a broad range of commercial, retail and mortgage banking services, as well as trust, investment, leasing and insurance services.
 IRWIN FINANCIAL CORPORATION
 Financial Highlights
 1992 1991 Pct. Change
 Second Quarter:
 Net Interest Income $7,046,918 $4,650,293 51.54
 Provision for Possible Loan
 Losses 490,000 326,000 50.31
 Other Income 15,901,531 10,638,936 49.47
 Other Expense 18,537,907 12,480,838 48.53
 Income before Income Taxes 3,920,542 2,482,391 57.93
 Income Taxes 1,462,000 1,037,000 40.98
 Net Income 2,458,542 1,445,391 70.10
 Dividends 284,789 224,628 26.78
 Per Share (A):
 Net Income $1.71 $1.03
 Dividends 0.20 0.16
 Market Stock Price (bid) (A):
 High $49.50 $24.33
 Low 46.50 19.33
 Year to Date:
 Net Interest Income $13,201,505 $8,680,403 52.08
 Provision for Possible Loan
 Losses 910,000 554,000 64.26
 Other Income 30,545,433 18,777,617 62.67
 Other Expense 34,552,831 22,269,612 55.16
 Income before Income Taxes 8,284,107 4,634,408 78.75
 Income Taxes 3,159,000 1,901,000 66.18
 Net Income 5,125,107 2,733,408 87.50
 Dividends 568,625 448,396 26.81
 Per Share (A):
 Net Income $3.57 $1.94
 Dividends 0.40 0.32
 Market Stock Price (Bid) (A):
 High $49.50 $24.33
 Low 32.00 14.83
 Performance Ratios -- Year-to-Date:
 Return on Average Assets (pct) 1.58 1.18
 Return on Average Equity (pct) 22.74 14.58
 At June 30:
 Total Assets $637,295,696 $549,063,382 16.07
 Mortgage Loans Held for Sale 298,353,147 250,302,162 19.20
 Total Loans 197,871,579 168,972,211 17.10
 Allowance for Possible Loan
 Losses 3,014,989 2,011,751 49.87
 Shareholders' Equity 47,611,397 38,842,710 22.57
 Per Share (A):
 Shareholders' Equity $33.42 $27.64
 Market Stock Price (Bid) 48.50 24.00
 Average Shares Outstanding 1,434,689 1,409,487 1.79
 (A) -- 1991 amounts adjusted for three-for-two stock split effective Dec. 30, 1991.
 -0- 7/16/92
 /CONTACT: Bradley Kime (media), 812-376-1734; or Thomas Washburn (investors), 812-376-1769; both of Irwin Financial Corporation/
 (IRWN) CO: Irwin Financial Corporation ST: Indiana IN: FIN SU: ERN


KK -- CL011 -- 9896 07/16/92 15:28 EDT
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