FLINT, Mich., Jan. 22, 2013 /PRNewswire/ --
- Net income attributable to common shareholders for the quarter increased 15% compared to last quarter and 38% compared to the fourth quarter of 2011
- For the full year, net income attributable to common shareholders was $348 million or $8.61 per share
- Continued strong credit metrics and a solid core deposit funding base have created a lower risk profile balance sheet
- Pre-tax, pre-provision profit remained strong at $32 million
Citizens Republic Bancorp, Inc. (Nasdaq: CRBC) announced net income attributable to common shareholders of $17.0 million or $0.42 per diluted share for the three months ended December 31, 2012, compared to $14.9 million or $0.37 per diluted share for last quarter, and $12.3 million or $0.31 per diluted share for the fourth quarter of last year. For the year ended December 31, 2012, Citizens recorded net income attributable to common shareholders of $347.9 million or $8.61 per share compared to a net loss of $16.3 million or $0.41 per share for the prior year. Year to date 2012 results include a $275.5 million or $6.82 per share tax benefit related to the elimination of the valuation allowance against the deferred tax asset in the second quarter.
"We are pleased with our 2012 earnings results, which reflect our bankers' persistent execution of our strategic initiatives. Our success during 2012 allowed us to complete our key priorities including terminating our written regulatory agreement and restoring our deferred tax asset. In addition, we are in the midst of paying our accrued trust preferred dividends and our TARP obligation will be repaid through our pending merger with FirstMerit. We are proud of the hard work and dedication of everyone at Citizens as together we have addressed the many challenges from the last several years, and have emerged as a stronger banking franchise," commented Cathleen Nash, president and chief executive officer.
"While we continue to execute on our priorities, we are also looking ahead to our combination with FirstMerit as we create a premier Midwest banking franchise providing enhanced products and services to our clients and significant long-term value to our shareholders," added Nash.
Balance Sheet
Citizens continues to enjoy a strong core deposit funding base. Core deposits of $5.4 billion at December 31, 2012 decreased slightly from the third quarter as a result of an expected seasonal reduction in public funds balances, but increased $255.8 million, or 4.9% from December 31, 2011. Time deposits decreased $69.5 million, or 3.9%, from the third quarter and $490.0 million, or 22.3%, from the fourth quarter of 2011 due to the intentional non-renewal of high cost rate sensitive retail and brokered balances.
Total assets decreased $138.1 million from the third quarter as a reduction in loan portfolio balances was partially offset by an increase in investment securities balances. Over the past year, growth within the C&I and indirect consumer portfolios helped to partially mitigate balance reductions in the commercial real estate, residential mortgage, and direct consumer portfolios. Citizens continues to emphasize C&I and consumer lending as key components of its strategic plan.
Capital
Citizens continues to grow capital organically through earnings and maintains a strong capital position.
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Capital Ratios
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December 31,
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September 30,
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December 31,
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2012*
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2012
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2011
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Leverage ratio
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9.95%
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9.66%
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8.45%
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Tier 1 capital ratio
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15.67
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15.09
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13.51
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Total capital ratio
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16.93
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16.35
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14.84
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Tier 1 common equity (non-GAAP)
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9.24
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8.83
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7.24
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Tangible equity to tangible assets (non-GAAP)
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11.30
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11.00
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7.59
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Tangible common equity to tangible assets (non-GAAP)
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8.15
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7.91
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4.47
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* Estimate
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Net Interest Income and Margin
Net interest margin was 3.50% in the fourth quarter, a seven basis point decrease from last quarter and a twelve basis point decrease from the fourth quarter of last year. The decreases were driven by the continued low interest rate environment, which has resulted in reduced yields on our earning assets. The negative effects on asset yields were partially offset by a more advantageous funding mix and reduced funding costs. In the fourth quarter the negative pressures were also somewhat offset by an increase in commercial loan fees collected with the restructuring of several larger client relationships. For the year ended December 31, 2012, net interest margin decreased two basis points over the prior year to 3.56%.
Net interest income for the fourth quarter was $73.2 million, a reduction of $2.6 million from last quarter and a decrease of $4.9 million from the fourth quarter of last year. The decreases from both periods are result of both lower average earning assets and margin compression. For the year ended December 31, 2012, net interest income decreased $12.3 million compared to 2011 primarily due to a reduction in average earning assets.
Credit Quality
Credit quality continued its strong performance.
- Total delinquencies remained stable at 0.6% of portfolio loans.
- Nonperforming assets were $68.0 million, a 21% decrease from the end of September and a 33% decrease from December of last year due to proactively managing and resolving delinquent commercial and consumer loans and improving the risk profile of the loan portfolio.
- Net charge-offs for the fourth quarter decreased to $16.0 million, compared to $19.2 million last quarter and $32.6 million in the fourth quarter of last year. The provision for loan losses was $4.3 million in the fourth quarter, a decrease from $5.2 million in the third quarter and $15.0 million in the fourth quarter of the prior year.
- The allowance for loan losses was $110.4 million or 2.10% of portfolio loans at December 31, 2012, compared to $122.1 million or 2.25% at the end of the prior quarter, and $172.7 million or 3.12% at the end of the prior year.
Noninterest Income and Expense
Total noninterest income was $22.0 million, a reduction of $1.7 million from the third quarter and a reduction of $2.3 million from the fourth quarter of last year. For the full year, noninterest income was $92.3 million; a decrease of $2.9 million compared to 2011.
- Service charges decreased slightly from both the third quarter of 2012 and fourth quarter of last year. For the full year, service charges on deposit accounts decreased 5% compared last year as clients changed behavior relative to penalty fees and product choices.
- Brokerage and investment fees decreased $0.3 million compared to the prior quarter, however due to focused efforts to increase performance; fees increased 26% over the fourth quarter of last year, and improved 19% for the full year.
- Other income decreased compared to last quarter primarily due to lower gains on deferred compensation.
- The fourth quarter includes a $2.7 million charge related to one commercial loan relationship in the held for sale portfolio, that was partially offset by gains.
Noninterest expense was $6.9 million less than last quarter and $1.5 million lower than the fourth quarter of last year.
- Professional services were $4.3 million lower than last quarter due to a reduction in merger related expenses.
- Citizens experienced an overall recovery in ORE during the quarter compared to losses in both the third quarter of this year and the fourth quarter of 2011.
For the year ended December 31, 2012, noninterest expense decreased $12.5 million or 4% from 2011 as lower credit related expenses were partially offset by higher salaries and employee benefits and merger-related expenses.
Income Taxes and Deferred Tax Asset
The income tax benefit for 2012 totaled $273.0 million, compared with a benefit of $20.3 million for 2011. The majority of the tax benefit in 2012 was recorded in the second quarter as the result of eliminating the valuation allowance against our deferred tax asset.
Conference Call
Citizens' senior management will review the quarter's results in a conference call at 12:00 p.m. Eastern Time on Tuesday, January 22, 2013. A live audio webcast is available on Citizens' investor relations page at www.citizensbanking.com or by calling (866) 952-1906 (conference ID: Citizens Republic). To listen to the conference call, please connect approximately 10 minutes prior to the scheduled conference time. A recording will be available approximately two hours after the completion of the conference call at www.citizensbanking.com, where it will be archived for 90 days.
Use of Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles ("GAAP"), this release includes non-GAAP financial measures such as tangible equity to tangible assets ratio, tangible common equity to tangible assets ratio, Tier 1 common equity ratio, pre-tax pre-provision profit, net interest margin, the efficiency ratio, and adjusted earnings per share. Citizens believes these non-GAAP financial measures provide additional information that is useful to investors in understanding the underlying performance of Citizens, its business and performance trends, and such measures help facilitate performance comparisons with others in the banking industry. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. Readers should be aware of these limitations and should be cautious as to their use of such measures. To mitigate these limitations, Citizens has procedures in place to ensure that these measures are calculated using the appropriate GAAP or regulatory components in their entirety to ensure that Citizens' performance is properly reflected to facilitate consistent period-to-period comparisons. Although Citizens believes the above non-GAAP financial measures disclosed in this release enhance investors' understanding of its business and performance, these non-GAAP measures should not be considered in isolation, or as a substitute for GAAP basis financial measures. See our related Form 8-K for further discussion regarding these non-GAAP financial measures.
Corporate Profile
Citizens Republic Bancorp, Inc. is a diversified financial services company providing a wide range of commercial, consumer, mortgage banking, trust and financial planning services to a broad client base. Citizens serves communities in Michigan, Ohio, and Wisconsin with 219 offices and 248 ATMs. Citizens is the largest bank holding company headquartered in Michigan with roots dating back to 1871 and is the 58th largest bank holding company headquartered in the United States. More information about Citizens is available at www.citizensbanking.com.
Safe Harbor Statement
Discussions and statements in this release that are not statements of historical fact, including without limitation, statements that include terms such as "will," "may," "should," "believe," "expect," "anticipate," "estimate," "project," "intend," and "plan," and statements regarding Citizens' future financial and operating results, plans, objectives, expectations and intentions, are forward-looking statements that involve risks and uncertainties, many of which are beyond Citizens' control or are subject to change. No forward-looking statement is a guarantee of future performance and actual results could differ materially.
Factors that could cause or contribute to actual results differing materially from Citizens' expectations include the risks and uncertainties detailed from time to time in Citizens' annual and quarterly filings with the SEC, which are available at the SEC's website www.sec.gov. Other factors not currently anticipated may also materially and adversely affect Citizens' results of operations, cash flows, financial position and prospects. There can be no assurance that future results will meet expectations. While Citizens believes that the forward-looking statements in this release are reasonable, you should not place undue reliance on any forward-looking statement. In addition, these statements speak only as of the date made. Citizens does not undertake, and expressly disclaims, any obligation to update or alter any statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
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Consolidated Balance Sheets (Unaudited)
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Citizens Republic Bancorp, Inc.
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December 31,
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September 30,
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December 31,
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(in thousands)
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2012
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2012
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2011
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Assets
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Cash and due from banks
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$ 173,510
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$ 162,705
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$ 153,418
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Money market investments
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186,349
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223,818
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313,632
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Investment Securities:
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Securities available for sale, at fair value
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1,697,625
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1,541,567
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1,312,733
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Securities held to maturity, at amortized cost
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(fair value of $1,282,244, $1,378,310 and $1,487,550, respectively)
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1,226,268
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1,313,504
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1,444,054
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Total investment securities
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2,923,893
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2,855,071
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2,756,787
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FHLB and Federal Reserve stock
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126,763
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122,123
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117,943
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Portfolio loans:
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Commercial and industrial
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1,656,292
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1,688,996
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1,543,529
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Commercial real estate
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1,242,348
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1,335,601
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1,544,361
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Total commercial
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2,898,640
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3,024,597
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3,087,890
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Residential mortgage
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546,513
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570,295
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637,245
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Direct consumer
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844,240
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865,777
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933,314
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Indirect consumer
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969,583
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970,235
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871,086
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Total portfolio loans
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5,258,976
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5,430,904
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5,529,535
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Less: Allowance for loan losses
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(110,439)
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(122,125)
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(172,726)
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Net portfolio loans
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5,148,537
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5,308,779
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5,356,809
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Loans held for sale
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10,719
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30,062
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10,402
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Premises and equipment
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90,291
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92,005
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97,970
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Goodwill
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318,150
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318,150
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318,150
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Other intangible assets
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5,308
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5,792
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7,428
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Bank owned life insurance
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223,235
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222,610
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220,280
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Deferred tax assets
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272,891
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268,347
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---
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Other assets
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107,037
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115,328
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110,030
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Total assets
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$ 9,586,683
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$ 9,724,790
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$ 9,462,849
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Liabilities
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Noninterest-bearing deposits
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$ 1,754,248
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$ 1,854,715
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$ 1,614,311
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Interest-bearing demand deposits
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1,100,763
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1,092,679
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951,590
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Savings deposits
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2,594,378
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2,574,642
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2,627,665
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Core deposits
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5,449,389
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5,522,036
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5,193,566
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Time deposits
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1,711,396
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1,780,929
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2,201,375
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Total deposits
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7,160,785
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7,302,965
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7,394,941
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Federal funds purchased and securities sold
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under agreements to repurchase
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42,747
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42,796
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|
40,098
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Other liabilities
|
|
161,736
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|
168,351
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|
154,088
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Long-term debt
|
|
850,910
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|
852,481
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|
854,185
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Total liabilities
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8,216,178
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8,366,593
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8,443,312
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Shareholders' Equity
|
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Preferred stock - no par value
|
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292,473
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290,580
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285,114
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Common stock - no par value
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1,437,877
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1,436,925
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1,434,803
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Retained deficit
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|
(346,632)
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(363,659)
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|
(694,560)
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Accumulated other comprehensive loss
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(13,213)
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(5,649)
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(5,820)
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Total shareholders' equity
|
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1,370,505
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|
1,358,197
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|
1,019,537
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Total liabilities and shareholders' equity
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$ 9,586,683
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$ 9,724,790
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$ 9,462,849
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|
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|
|
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|
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Consolidated Statements of Operations (Unaudited)
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Citizens Republic Bancorp, Inc.
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Three Months Ended
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Twelve Months Ended
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December 31,
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December 31,
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(in thousands, except per share amounts)
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2012
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2011
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2012
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2011
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Interest Income
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|
|
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Interest and fees on loans
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$ 71,578
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$ 77,146
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|
$ 293,782
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$ 312,746
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Interest and dividends on investment securities:
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Taxable
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14,556
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|
18,617
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63,912
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|
79,281
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Tax-exempt
|
|
2,101
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|
2,388
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|
8,711
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10,800
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Dividends on FHLB and Federal Reserve stock
|
|
1,410
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|
1,009
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|
4,897
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|
4,152
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Money market investments
|
|
145
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|
170
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|
626
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|
840
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Total interest income
|
|
89,790
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|
99,330
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|
371,928
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407,819
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Interest Expense
|
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|
|
|
|
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Deposits
|
|
8,217
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|
12,382
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|
37,459
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|
57,327
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Short-term borrowings
|
|
11
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|
21
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|
53
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|
79
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Long-term debt
|
|
8,392
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|
8,878
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|
33,644
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|
37,303
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Total interest expense
|
|
16,620
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|
21,281
|
|
71,156
|
|
94,709
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Net Interest Income
|
|
73,170
|
|
78,049
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|
300,772
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|
313,110
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Provision for loan losses
|
|
4,314
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|
15,007
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|
23,204
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|
138,808
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|
Net interest income after provision for loan losses
|
|
68,856
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|
63,042
|
|
277,568
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|
174,302
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Noninterest Income
|
|
|
|
|
|
|
|
|
|
Service charges on deposit accounts
|
|
9,414
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|
9,724
|
|
37,308
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|
39,268
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|
Trust fees
|
|
3,782
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|
3,747
|
|
14,601
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|
15,103
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Mortgage and other loan income
|
|
2,265
|
|
2,705
|
|
8,104
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|
9,620
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|
Brokerage and investment fees
|
|
1,569
|
|
1,243
|
|
6,055
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|
5,072
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Card-based and other nondeposit fees
|
|
4,367
|
|
4,305
|
|
17,507
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|
17,167
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|
Net (losses) gains on loans held for sale
|
|
(1,723)
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|
(217)
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|
(984)
|
|
1,808
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Investment securities gains (losses)
|
|
---
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|
38
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|
---
|
|
(1,336)
|
|
Other income
|
|
2,350
|
|
2,818
|
|
9,729
|
|
8,555
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|
Total noninterest income
|
|
22,024
|
|
24,363
|
|
92,320
|
|
95,257
|
|
Noninterest Expense
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits
|
|
33,163
|
|
30,952
|
|
132,850
|
|
123,514
|
|
Occupancy
|
|
6,031
|
|
6,326
|
|
24,997
|
|
26,059
|
|
Professional services
|
|
2,478
|
|
2,311
|
|
13,772
|
|
9,331
|
|
Equipment
|
|
2,858
|
|
3,326
|
|
12,001
|
|
12,136
|
|
Data processing services
|
|
4,521
|
|
3,709
|
|
16,717
|
|
16,131
|
|
Advertising and public relations
|
|
1,014
|
|
1,298
|
|
5,904
|
|
5,848
|
|
Postage and delivery
|
|
1,081
|
|
1,165
|
|
4,456
|
|
4,543
|
|
Other loan expenses
|
|
3,650
|
|
3,497
|
|
13,224
|
|
16,007
|
|
(Gains) losses on other real estate (ORE)
|
|
(596)
|
|
1,081
|
|
(214)
|
|
12,768
|
|
ORE expenses
|
|
220
|
|
995
|
|
1,259
|
|
4,322
|
|
Intangible asset amortization
|
|
484
|
|
688
|
|
2,120
|
|
3,027
|
|
Other expense
|
|
10,224
|
|
11,292
|
|
43,536
|
|
49,464
|
|
Total noninterest expense
|
|
65,128
|
|
66,640
|
|
270,622
|
|
283,150
|
|
Income (Loss) before Income Taxes
|
|
25,752
|
|
20,765
|
|
99,266
|
|
(13,591)
|
|
Income tax provision (benefit)
|
|
2,505
|
|
2,521
|
|
(273,009)
|
|
(20,258)
|
|
Net Income
|
|
23,247
|
|
18,244
|
|
372,275
|
|
6,667
|
|
Dividend on redeemable preferred stock
|
|
(6,220)
|
|
(5,897)
|
|
(24,347)
|
|
(22,985)
|
|
Net Income (Loss) Attributable to Common Shareholders
|
|
$ 17,027
|
|
$ 12,347
|
|
$ 347,928
|
|
$ (16,318)
|
|
Net Income (Loss) Per Common Share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ 0.42
|
|
$ 0.31
|
|
$ 8.61
|
|
$ (0.41)
|
|
Diluted
|
|
0.42
|
|
0.31
|
|
8.61
|
|
(0.41)
|
|
Average Common Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
39,491
|
|
39,433
|
|
39,475
|
|
39,422
|
|
Diluted
|
|
39,491
|
|
39,433
|
|
39,475
|
|
39,422
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Quarterly Information (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
December 31,
|
|
|
September 30,
|
|
|
June 30,
|
|
|
March 31,
|
|
|
December 31,
|
|
|
(in thousands, except per share amounts)
|
|
2012
|
|
|
2012
|
|
|
2012
|
|
|
2012
|
|
|
2011
|
|
|
Summary of Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
|
|
$ 73,170
|
|
|
$ 75,805
|
|
|
$ 75,680
|
|
|
$ 76,119
|
|
|
$ 78,049
|
|
|
Provision for loan losses
|
|
4,314
|
|
|
5,195
|
|
|
5,299
|
|
|
8,397
|
|
|
15,007
|
|
|
Noninterest income
|
|
22,024
|
|
|
23,710
|
|
|
22,345
|
|
|
24,240
|
|
|
24,363
|
|
|
Noninterest expense
|
|
65,128
|
|
|
72,055
|
|
|
66,339
|
|
|
67,101
|
|
|
66,640
|
|
|
Income before income taxes
|
|
25,752
|
|
|
22,265
|
|
|
26,387
|
|
|
24,861
|
|
|
20,765
|
|
|
Income tax provision (benefit) from continuing operations
|
|
2,505
|
|
|
1,274
|
|
|
(276,789)
|
|
|
---
|
|
|
2,521
|
|
|
Net income
|
|
23,247
|
|
|
20,991
|
|
|
303,176
|
|
|
24,861
|
|
|
18,244
|
|
|
Net income attributable to common shareholders
|
|
17,027
|
|
|
14,861
|
|
|
297,134
|
|
|
18,906
|
|
|
12,347
|
|
|
Taxable equivalent adjustment, continuing operations
|
|
1,468
|
|
|
1,503
|
|
|
1,532
|
|
|
1,571
|
|
|
1,670
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per Common Share Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ 0.42
|
|
|
$ 0.37
|
|
|
$ 7.35
|
|
|
$ 0.47
|
|
|
$ 0.31
|
|
|
Diluted
|
|
0.42
|
|
|
0.37
|
|
|
7.35
|
|
|
0.47
|
|
|
0.31
|
|
|
Common book value
|
|
26.62
|
|
|
26.36
|
|
|
25.85
|
|
|
18.83
|
|
|
18.24
|
|
|
Tangible book value (non-GAAP)
|
|
25.85
|
|
|
25.53
|
|
|
24.97
|
|
|
17.88
|
|
|
17.24
|
|
|
Tangible common book value (non-GAAP)
|
|
18.63
|
|
|
18.36
|
|
|
17.84
|
|
|
10.75
|
|
|
10.16
|
|
|
Shares outstanding, end of period (1)
|
|
40,497,890
|
|
|
40,508,823
|
|
|
40,504,637
|
|
|
40,247,241
|
|
|
40,260,213
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At Period End
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
$ 9,586,683
|
|
|
$ 9,724,790
|
|
|
$ 9,670,493
|
|
|
$ 9,577,346
|
|
|
$ 9,462,849
|
|
|
Earning assets
|
|
8,453,513
|
|
|
8,600,731
|
|
|
8,588,343
|
|
|
8,774,119
|
|
|
8,680,995
|
|
|
Portfolio loans
|
|
5,258,976
|
|
|
5,430,904
|
|
|
5,521,748
|
|
|
5,528,063
|
|
|
5,529,535
|
|
|
Allowance for loan losses
|
|
110,439
|
|
|
122,125
|
|
|
136,120
|
|
|
153,007
|
|
|
172,726
|
|
|
Deposits
|
|
7,160,785
|
|
|
7,302,965
|
|
|
7,287,709
|
|
|
7,490,362
|
|
|
7,394,941
|
|
|
Long-term debt
|
|
850,910
|
|
|
852,481
|
|
|
853,042
|
|
|
853,599
|
|
|
854,185
|
|
|
Shareholders' equity
|
|
1,370,505
|
|
|
1,358,197
|
|
|
1,335,855
|
|
|
1,044,619
|
|
|
1,019,537
|
|
|
Average for the Quarter
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
$ 9,604,447
|
|
|
$ 9,723,587
|
|
|
$ 9,429,050
|
|
|
$ 9,521,386
|
|
|
$ 9,523,184
|
|
|
Earning assets
|
|
8,506,333
|
|
|
8,638,390
|
|
|
8,622,067
|
|
|
8,750,078
|
|
|
8,761,435
|
|
|
Portfolio loans
|
|
5,317,771
|
|
|
5,501,400
|
|
|
5,517,726
|
|
|
5,508,528
|
|
|
5,632,432
|
|
|
Allowance for loan losses
|
|
121,998
|
|
|
135,968
|
|
|
152,154
|
|
|
172,509
|
|
|
190,163
|
|
|
Deposits
|
|
7,181,654
|
|
|
7,323,753
|
|
|
7,317,653
|
|
|
7,441,693
|
|
|
7,452,137
|
|
|
Long-term debt
|
|
851,723
|
|
|
852,776
|
|
|
853,333
|
|
|
853,912
|
|
|
856,206
|
|
|
Shareholders' equity
|
|
1,364,250
|
|
|
1,345,817
|
|
|
1,061,519
|
|
|
1,028,494
|
|
|
1,017,082
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Ratios (annualized)(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets
|
|
0.96
|
%
|
|
0.86
|
%
|
|
12.93
|
%
|
|
1.05
|
%
|
|
0.76
|
%
|
|
Return on average shareholders' equity
|
|
6.78
|
|
|
6.20
|
|
|
114.87
|
|
|
9.72
|
|
|
7.12
|
|
|
Average shareholders' equity / average assets
|
|
14.20
|
|
|
13.84
|
|
|
11.26
|
|
|
10.80
|
|
|
10.68
|
|
|
Net interest margin (FTE) (3)
|
|
3.50
|
|
|
3.57
|
|
|
3.60
|
|
|
3.56
|
|
|
3.62
|
|
|
Efficiency ratio (non-GAAP) (4)
|
|
66.65
|
|
|
65.20
|
|
|
65.99
|
|
|
65.20
|
|
|
61.39
|
|
|
Allowance for loan losses as a percent of portfolio loans
|
|
2.10
|
|
|
2.25
|
|
|
2.47
|
|
|
2.77
|
|
|
3.12
|
|
|
Allowance for loan losses as a percent of nonperforming loans
|
|
187.15
|
|
|
191.29
|
|
|
161.53
|
|
|
202.56
|
|
|
197.56
|
|
|
Allowance for loan losses as a percent of nonperforming assets
|
|
162.38
|
|
|
141.69
|
|
|
144.85
|
|
|
168.87
|
|
|
168.97
|
|
|
Nonperforming loans as a percent of portfolio loans
|
|
1.12
|
|
|
1.18
|
|
|
1.53
|
|
|
1.37
|
|
|
1.58
|
|
|
Nonperforming assets as a percent of total loans plus ORAA(5)
|
|
1.29
|
|
|
1.58
|
|
|
1.69
|
|
|
1.63
|
|
|
1.84
|
|
|
Nonperforming assets as a percent of total assets
|
|
0.71
|
|
|
0.89
|
|
|
0.97
|
|
|
0.95
|
|
|
1.08
|
|
|
Ratio of net charge-offs during period to average portfolio loans
|
|
1.20
|
|
|
1.39
|
|
|
1.62
|
|
|
2.05
|
|
|
2.30
|
|
|
Leverage ratio
|
|
9.95
|
|
|
9.66
|
|
|
9.77
|
|
|
8.71
|
|
|
8.45
|
|
|
Tier 1 capital ratio
|
|
15.67
|
|
|
15.09
|
|
|
14.70
|
|
|
13.70
|
|
|
13.51
|
|
|
Total capital ratio
|
|
16.93
|
|
|
16.35
|
|
|
15.96
|
|
|
14.97
|
|
|
14.84
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)Includes participating shares which are restricted stock units and restricted shares.
|
|
|
|
|
|
(2)Financial ratios are based upon continuing operations.
|
|
|
|
|
|
(3)Net interest margin is presented on an annual basis, includes taxable equivalent adjustments to interest income and is based on a tax rate of 35%.
|
|
(4)The efficiency ratio measures how efficiently a bank spends its revenues. The formula is: (noninterest expense - goodwill impairment)/(net interest income + taxable equivalent adjustment + total noninterest income - investment securities gains (losses)).
|
|
(5)Other real estate assets acquired ("ORAA") include loans held for sale.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan Portfolios
(in thousands)
|
December 31, 2012
|
|
September 30, 2012
|
|
June 30, 2012
|
|
March 31, 2012
|
|
December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land hold
|
$ 4,366
|
|
$ 4,984
|
|
$ 5,119
|
|
$ 5,387
|
|
$ 6,542
|
|
|
Land development
|
6,258
|
|
7,521
|
|
7,006
|
|
7,226
|
|
13,104
|
|
|
Construction
|
8,860
|
|
6,689
|
|
4,591
|
|
6,410
|
|
5,847
|
|
|
Income producing
|
689,765
|
|
767,202
|
|
803,546
|
|
877,461
|
|
913,755
|
|
|
Owner-occupied
|
533,099
|
|
549,205
|
|
597,147
|
|
590,575
|
|
605,113
|
|
|
Total commercial real estate
|
1,242,348
|
|
1,335,601
|
|
1,417,409
|
|
1,487,059
|
|
1,544,361
|
|
|
Commercial and industrial
|
1,656,292
|
|
1,688,996
|
|
1,711,411
|
|
1,657,140
|
|
1,543,529
|
|
|
Total commercial
|
2,898,640
|
|
3,024,597
|
|
3,128,820
|
|
3,144,199
|
|
3,087,890
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgage
|
546,513
|
|
570,295
|
|
588,144
|
|
611,166
|
|
637,245
|
|
|
Direct consumer
|
844,240
|
|
865,777
|
|
881,070
|
|
903,238
|
|
933,314
|
|
|
Indirect consumer
|
969,583
|
|
970,235
|
|
923,714
|
|
869,460
|
|
871,086
|
|
|
Total consumer
|
2,360,336
|
|
2,406,307
|
|
2,392,928
|
|
2,383,864
|
|
2,441,645
|
|
|
Total portfolio loans
|
$ 5,258,976
|
|
$ 5,430,904
|
|
$ 5,521,748
|
|
$ 5,528,063
|
|
$ 5,529,535
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delinquency Rates By Loan Portfolio
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012
|
September 30, 2012
|
June 30, 2012
|
March 31, 2012
|
December 31, 2011
|
|
30 to 89 days past due
(in thousands)
|
$
|
% of Portfolio
|
|
$
|
% of
Portfolio
|
|
$
|
% of Portfolio
|
|
$
|
% of Portfolio
|
|
$
|
% of Portfolio
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land hold
|
$ ---
|
---
|
%
|
$ ---
|
---
|
%
|
$ ---
|
---
|
%
|
$ ---
|
---
|
%
|
$ 21
|
0.32
|
%
|
|
Land development
|
---
|
---
|
|
---
|
---
|
|
---
|
---
|
|
130
|
1.81
|
|
---
|
---
|
|
|
Construction
|
---
|
---
|
|
---
|
---
|
|
---
|
---
|
|
---
|
---
|
|
---
|
---
|
|
|
Income producing
|
1,470
|
0.21
|
|
1,104
|
0.14
|
|
1,519
|
0.19
|
|
1,447
|
0.16
|
|
2,508
|
0.27
|
|
|
Owner-occupied
|
695
|
0.13
|
|
4,598
|
0.84
|
|
936
|
0.16
|
|
5,177
|
0.88
|
|
2,345
|
0.39
|
|
|
Total commercial real estate
|
2,165
|
0.17
|
|
5,702
|
0.43
|
|
2,455
|
0.17
|
|
6,754
|
0.45
|
|
4,874
|
0.32
|
|
|
Commercial and industrial
|
1,949
|
0.12
|
|
880
|
0.05
|
|
1,565
|
0.09
|
|
2,887
|
0.17
|
|
2,454
|
0.16
|
|
|
Total commercial
|
4,114
|
0.14
|
|
6,582
|
0.22
|
|
4,020
|
0.13
|
|
9,641
|
0.31
|
|
7,328
|
0.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgage
|
7,641
|
1.40
|
|
6,029
|
1.06
|
|
7,731
|
1.31
|
|
7,568
|
1.24
|
|
9,544
|
1.50
|
|
|
Direct consumer
|
13,354
|
1.58
|
|
11,435
|
1.32
|
|
12,396
|
1.41
|
|
14,002
|
1.55
|
|
17,810
|
1.91
|
|
|
Indirect consumer
|
8,356
|
0.86
|
|
7,514
|
0.77
|
|
8,504
|
0.92
|
|
8,780
|
1.01
|
|
13,067
|
1.50
|
|
|
Total consumer
|
29,351
|
1.24
|
|
24,978
|
1.04
|
|
28,631
|
1.20
|
|
30,350
|
1.27
|
|
40,421
|
1.66
|
|
|
Total delinquent loans
|
$ 33,465
|
0.64
|
|
$ 31,560
|
0.58
|
|
$ 32,651
|
0.59
|
|
$ 39,991
|
0.72
|
|
$ 47,749
|
0.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming Assets
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012
|
September 30, 2012
|
June 30, 2012
|
March 31, 2012
|
December 31, 2011
|
|
(in thousands)
|
$
|
% of Portfolio
|
|
$
|
% of
Portfolio
|
|
$
|
% of Portfolio
|
|
$
|
% of Portfolio
|
|
$
|
% of Portfolio
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land hold
|
$ 291
|
6.67
|
%
|
$ 326
|
6.54
|
%
|
$ 326
|
6.37
|
%
|
$ ---
|
---
|
%
|
$ ---
|
---
|
%
|
|
Land development
|
3
|
0.04
|
|
3
|
0.04
|
|
3
|
0.05
|
|
207
|
2.87
|
|
213
|
1.62
|
|
|
Construction
|
---
|
---
|
|
---
|
---
|
|
---
|
---
|
|
150
|
2.34
|
|
150
|
2.57
|
|
|
Income producing
|
8,117
|
1.18
|
|
12,904
|
1.68
|
|
19,408
|
2.42
|
|
18,566
|
2.12
|
|
21,171
|
2.32
|
|
|
Owner-occupied
|
12,068
|
2.26
|
|
13,146
|
2.39
|
|
18,187
|
3.05
|
|
20,716
|
3.51
|
|
23,798
|
3.93
|
|
|
Total commercial real estate
|
20,479
|
1.65
|
|
26,379
|
1.98
|
|
37,924
|
2.68
|
|
39,639
|
2.67
|
|
45,332
|
2.94
|
|
|
Commercial and industrial
|
6,162
|
0.37
|
|
9,190
|
0.54
|
|
21,676
|
1.27
|
|
14,629
|
0.88
|
|
16,946
|
1.10
|
|
|
Total nonaccruing commercial
|
26,641
|
0.92
|
|
35,569
|
1.18
|
|
59,600
|
1.90
|
|
54,268
|
1.73
|
|
62,278
|
2.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgage
|
17,500
|
3.20
|
|
15,271
|
2.68
|
|
13,474
|
2.29
|
|
11,137
|
1.82
|
|
11,312
|
1.78
|
|
|
Direct consumer
|
12,720
|
1.51
|
|
10,552
|
1.22
|
|
9,263
|
1.05
|
|
8,895
|
0.98
|
|
12,115
|
1.30
|
|
|
Indirect consumer
|
2,083
|
0.21
|
|
2,391
|
0.25
|
|
1,875
|
0.20
|
|
1,074
|
0.12
|
|
953
|
0.11
|
|
|
Total nonaccruing consumer
|
32,303
|
1.37
|
|
28,214
|
1.17
|
|
24,612
|
1.03
|
|
21,106
|
0.89
|
|
24,380
|
1.00
|
|
|
Total nonaccruing loans
|
58,944
|
1.12
|
|
63,783
|
1.17
|
|
84,212
|
1.53
|
|
75,374
|
1.37
|
|
86,658
|
1.57
|
|
|
Loans 90+ days still accruing
|
68
|
---
|
|
60
|
---
|
|
59
|
---
|
|
164
|
---
|
|
770
|
0.01
|
|
|
Total nonperforming portfolio loans
|
59,012
|
1.12
|
|
63,843
|
1.18
|
|
84,271
|
1.53
|
|
75,538
|
1.37
|
|
87,428
|
1.58
|
|
|
Nonperforming held for sale
|
3,190
|
|
|
16,650
|
|
|
887
|
|
|
3,264
|
|
|
2,372
|
|
|
|
Other repossessed assets acquired
|
5,811
|
|
|
5,700
|
|
|
8,817
|
|
|
11,803
|
|
|
12,422
|
|
|
|
Total nonperforming assets
|
$ 68,013
|
|
|
$ 86,193
|
|
|
$ 93,975
|
|
|
$ 90,605
|
|
|
$ 102,222
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructured loans still accruing
|
$ 21,033
|
|
|
$ 21,433
|
|
|
$ 18,187
|
|
|
$ 17,911
|
|
|
$ 32,347
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial inflows
|
$ 4,769
|
|
|
$ 4,572
|
|
|
$ 23,828
|
|
|
$ 14,027
|
|
|
$ 13,269
|
|
|
|
Commercial outflows
|
(13,697)
|
|
|
(28,603)
|
|
|
(18,496)
|
|
|
(22,037)
|
|
|
(20,730)
|
|
|
|
Net change
|
$ (8,928)
|
|
|
$ (24,031)
|
|
|
$ 5,332
|
|
|
$ (8,010)
|
|
|
$ (7,461)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Charge-Offs
|
|
|
|
Three Months Ended
|
|
December 31, 2012
|
September 30, 2012
|
June 30, 2012
|
March 31, 2012
|
December 31, 2011
|
|
(in thousands)
|
$
|
% of Portfolio*
|
|
$
|
% of Portfolio*
|
|
$
|
% of Portfolio*
|
|
$
|
% of Portfolio*
|
|
$
|
% of Portfolio*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land hold
|
$ 133
|
12.10
|
%
|
$ ---
|
---
|
%
|
$ (58)
|
(4.58)
|
%
|
$ ---
|
---
|
%
|
$ (33)
|
(2.00)
|
%
|
|
Land development
|
(14)
|
(0.89)
|
|
(8)
|
(0.45)
|
|
100
|
5.76
|
|
(83)
|
(4.64)
|
|
3,079
|
93.21
|
|
|
Construction
|
(1)
|
(0.04)
|
|
(21)
|
(1.24)
|
|
14
|
1.24
|
|
(101)
|
(6.33)
|
|
(4)
|
(0.24)
|
|
|
Income producing
|
1,660
|
0.96
|
|
2,582
|
1.34
|
|
3,100
|
1.55
|
|
4,151
|
1.90
|
|
11,924
|
5.18
|
|
|
Owner-occupied
|
916
|
0.68
|
|
1,891
|
1.37
|
|
2,384
|
1.61
|
|
2,537
|
1.73
|
|
5,791
|
3.80
|
|
|
Total commercial real estate
|
2,694
|
0.86
|
|
4,444
|
1.32
|
|
5,540
|
1.57
|
|
6,504
|
1.76
|
|
20,757
|
5.33
|
|
|
Commercial and industrial
|
743
|
0.18
|
|
5,363
|
1.26
|
|
5,249
|
1.23
|
|
3,029
|
0.74
|
|
1,032
|
0.27
|
|
|
Total commercial
|
3,437
|
0.47
|
|
9,807
|
1.29
|
|
10,789
|
1.39
|
|
9,533
|
1.22
|
|
21,789
|
2.80
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgage
|
4,024
|
2.93
|
|
2,515
|
1.75
|
|
3,506
|
2.40
|
|
5,076
|
3.34
|
|
1,170
|
0.73
|
|
|
Direct consumer
|
5,614
|
2.65
|
|
4,790
|
2.20
|
|
5,666
|
2.59
|
|
10,935
|
4.87
|
|
6,930
|
2.95
|
|
|
Indirect consumer
|
2,925
|
1.20
|
|
2,078
|
0.85
|
|
2,225
|
0.97
|
|
2,572
|
1.19
|
|
2,746
|
1.25
|
|
|
Total consumer
|
12,563
|
2.12
|
|
9,383
|
1.55
|
|
11,397
|
1.92
|
|
18,583
|
3.14
|
|
10,846
|
1.76
|
|
|
Total net charge-offs
|
$ 16,000
|
1.20
|
|
$ 19,190
|
1.39
|
|
$ 22,186
|
1.62
|
|
$ 28,116
|
2.05
|
|
$ 32,635
|
2.30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Represents an annualized rate.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Loan Loss Experience
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
|
(in thousands)
|
|
2012
|
|
2012
|
|
2012
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses - beginning of period
|
|
$ 122,125
|
|
$ 136,120
|
|
$ 153,007
|
|
$ 172,726
|
|
$ 190,354
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for loan losses
|
|
4,314
|
|
5,195
|
|
5,299
|
|
8,397
|
|
15,007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
793
|
|
4,552
|
|
3,667
|
|
2,388
|
|
1,489
|
|
|
Small business
|
|
1,556
|
|
1,039
|
|
2,271
|
|
1,265
|
|
399
|
|
|
Commercial real estate
|
|
3,100
|
|
5,452
|
|
8,093
|
|
8,997
|
|
21,581
|
|
|
Total commercial
|
|
5,449
|
|
11,043
|
|
14,031
|
|
12,650
|
|
23,470
|
|
|
Residential mortgage
|
|
4,612
|
|
3,261
|
|
3,972
|
|
5,210
|
|
1,366
|
|
|
Direct consumer
|
|
6,798
|
|
6,067
|
|
7,168
|
|
11,527
|
|
7,544
|
|
|
Indirect consumer
|
|
3,835
|
|
3,172
|
|
3,157
|
|
3,251
|
|
3,229
|
|
|
Total charge-offs
|
|
20,694
|
|
23,543
|
|
28,328
|
|
32,638
|
|
35,609
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recoveries:
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
1,038
|
|
108
|
|
577
|
|
376
|
|
609
|
|
|
Small business
|
|
568
|
|
120
|
|
112
|
|
248
|
|
248
|
|
|
Commercial real estate
|
|
406
|
|
1,008
|
|
2,553
|
|
2,493
|
|
824
|
|
|
Total commercial
|
|
2,012
|
|
1,236
|
|
3,242
|
|
3,117
|
|
1,681
|
|
|
Residential mortgage
|
|
588
|
|
746
|
|
466
|
|
134
|
|
197
|
|
|
Direct consumer
|
|
1,184
|
|
1,277
|
|
1,502
|
|
592
|
|
613
|
|
|
Indirect consumer
|
|
910
|
|
1,094
|
|
932
|
|
679
|
|
483
|
|
|
Total recoveries
|
|
4,694
|
|
4,353
|
|
6,142
|
|
4,522
|
|
2,974
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs
|
|
16,000
|
|
19,190
|
|
22,186
|
|
28,116
|
|
32,635
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses - end of period
|
|
$ 110,439
|
|
$ 122,125
|
|
$ 136,120
|
|
$ 153,007
|
|
$ 172,726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Reconciliation
|
|
|
|
|
|
|
December 31,
|
September 30,
|
June 30,
|
March 31,
|
December 31,
|
|
(in thousands)
|
2012
|
2012
|
2012
|
2012
|
2011
|
|
Efficiency Ratio (non-GAAP)
|
|
|
|
|
|
|
Net interest income (A)
|
$ 73,170
|
$ 75,805
|
$ 75,680
|
$ 76,119
|
$ 78,049
|
|
Taxable equivalent adjustment (B)
|
1,468
|
1,503
|
1,532
|
1,571
|
1,670
|
|
Investment securities gains (C)
|
---
|
---
|
---
|
---
|
38
|
|
Noninterest income (D)
|
22,024
|
23,710
|
22,345
|
24,240
|
24,363
|
|
Noninterest expense (E)
|
65,128
|
72,055
|
66,339
|
67,101
|
66,640
|
|
(Gains) losses on ORE and ORE expenses (F)
|
(376)
|
1,264
|
93
|
65
|
2,076
|
|
Intangible amortization (G)
|
484
|
513
|
545
|
578
|
688
|
|
Merger-related expenses (H)
|
597
|
4,411
|
---
|
---
|
---
|
|
Efficiency ratio: (E-F-G-H)/(A+B-C+D)(non-GAAP)
|
66.65%
|
65.20%
|
65.99%
|
65.20%
|
61.39%
|
|
|
|
|
|
|
|
Tangible Common Equity to Tangible Assets (non-GAAP)
|
|
|
|
|
|
Total assets
|
$ 9,586,683
|
$ 9,724,790
|
$ 9,670,493
|
$ 9,577,346
|
$ 9,462,849
|
|
Goodwill
|
(318,150)
|
(318,150)
|
(318,150)
|
(318,150)
|
(318,150)
|
|
Other intangible assets
|
(5,308)
|
(5,792)
|
(6,305)
|
(6,850)
|
(7,428)
|
|
Tangible assets (non-GAAP)
|
$ 9,263,225
|
$ 9,400,848
|
$ 9,346,038
|
$ 9,252,346
|
$ 9,137,271
|
|
|
|
|
|
|
|
Total shareholders' equity
|
$ 1,370,505
|
$ 1,358,197
|
$ 1,335,855
|
$ 1,044,619
|
$ 1,019,537
|
|
Goodwill
|
(318,150)
|
(318,150)
|
(318,150)
|
(318,150)
|
(318,150)
|
|
Other intangible assets
|
(5,308)
|
(5,792)
|
(6,305)
|
(6,850)
|
(7,428)
|
|
Tangible equity (non-GAAP)
|
$ 1,047,047
|
$ 1,034,255
|
$ 1,011,400
|
$ 719,619
|
$ 693,959
|
|
|
|
|
|
|
|
Tangible equity
|
$ 1,047,047
|
$ 1,034,255
|
$ 1,011,400
|
$ 719,619
|
$ 693,959
|
|
Preferred stock
|
(292,473)
|
(290,580)
|
(288,723)
|
(286,901)
|
(285,114)
|
|
Tangible common equity (non-GAAP)
|
$ 754,574
|
$ 743,675
|
$ 722,677
|
$ 432,718
|
$ 408,845
|
|
|
|
|
|
|
|
Tier 1 Common Equity (non-GAAP)
|
|
|
|
|
|
|
Total shareholders' equity
|
$ 1,370,505
|
$ 1,358,197
|
$ 1,335,855
|
$ 1,044,619
|
$ 1,019,537
|
|
Qualifying capital securities
|
73,667
|
73,667
|
73,667
|
73,667
|
73,667
|
|
Goodwill
|
(318,150)
|
(318,150)
|
(318,150)
|
(318,150)
|
(318,150)
|
|
Accumulated other comprehensive loss
|
13,213
|
5,649
|
10,268
|
1,955
|
5,820
|
|
Disallowed deferred tax asset
|
(241,535)
|
(235,461)
|
(235,529)
|
---
|
---
|
|
Other intangible assets
|
(5,308)
|
(5,792)
|
(6,305)
|
(6,850)
|
(7,428)
|
|
Tier 1 capital (regulatory)
|
$ 892,392
|
$ 878,110
|
$ 859,806
|
$ 795,241
|
$ 773,446
|
|
|
|
|
|
|
|
Tier 1 capital (regulatory)
|
$ 892,392
|
$ 878,110
|
$ 859,806
|
$ 795,241
|
$ 773,446
|
|
Qualifying capital securities
|
(73,667)
|
(73,667)
|
(73,667)
|
(73,667)
|
(73,667)
|
|
Preferred stock
|
(292,473)
|
(290,580)
|
(288,723)
|
(286,901)
|
(285,114)
|
|
Total Tier 1 common equity (non-GAAP)
|
$ 526,252
|
$ 513,863
|
$ 497,416
|
$ 434,673
|
$ 414,665
|
|
|
|
|
|
|
|
Net risk-weighted assets (regulatory)
|
$ 5,695,254
|
$ 5,821,748
|
$ 5,851,871
|
$ 5,803,811
|
$ 5,723,333
|
|
|
|
|
|
|
|
Equity to assets
|
14.30%
|
13.97%
|
13.81%
|
10.91%
|
10.77%
|
|
Tier 1 common equity(non-GAAP)
|
9.24
|
8.83
|
8.50
|
7.49
|
7.24
|
|
Tangible equity to tangible assets(non-GAAP)
|
11.30
|
11.00
|
10.82
|
7.78
|
7.59
|
|
Tangible common equity to tangible assets(non-GAAP)
|
8.15
|
7.91
|
7.73
|
4.68
|
4.47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Reconciliation
|
|
|
|
|
|
|
Adjusted Earnings Per Share
|
|
Twelve Months Ended
|
|
|
|
December 31,
|
|
|
(in thousands, except per share amounts)
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
Earnings Per Share
|
|
|
|
|
|
|
Diluted net income (loss) per share
|
|
$ 8.61
|
|
$ (0.41)
|
|
|
Restoration of the deferred tax asset
|
|
6.82
|
|
---
|
|
|
Diluted net income (loss) per share (non-GAAP)
|
|
$ 1.79
|
|
$ (0.41)
|
|
|
|
|
|
|
|
|
An itemized reconciliation between net income on a GAAP basis and net income excluding the benefit
of restoring the deferred tax asset (non-GAAP) follows:
|
|
|
|
|
|
|
|
|
Numerator:
|
|
|
|
|
|
|
Net income
|
|
$ 372,275
|
|
$ 6,667
|
|
|
Restoration of the deferred tax asset
|
|
(275,484)
|
|
---
|
|
|
Net income (non-GAAP)
|
|
96,791
|
|
6,667
|
|
|
Dividend on redeemable preferred stock
|
|
(24,347)
|
|
(22,985)
|
|
|
Net income (loss) attributable to common shareholders (non-GAAP)
|
|
72,444
|
|
(16,318)
|
|
|
Net income allocated to participating securities
|
|
1,694
|
|
---
|
|
|
Net income (loss) after allocation to participating securities (non-GAAP)
|
|
$ 70,750
|
|
$ (16,318)
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
Weighted average shares outstanding for basic and dilutive earnings per common share
|
|
39,475
|
|
39,422
|
|
|
|
|
|
|
|
|
Basic net income (loss) per common share (non-GAAP)
|
|
$ 1.79
|
|
$ (0.41)
|
|
|
Diluted net income (loss) per common share (non-GAAP)
|
|
1.79
|
|
(0.41)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax pre-provision profit (non-GAAP)
|
Three Months Ended
|
|
(in thousands)
|
December 31,
2012
|
|
September 30,
2012
|
|
June 30,
2012
|
|
March 31,
2012
|
|
December 31,
2011
|
|
|
Net income
|
$ 23,247
|
|
$ 20,991
|
|
$ 303,176
|
|
$ 24,861
|
|
$ 18,244
|
|
|
Income tax provision (benefit)
|
2,505
|
|
1,274
|
|
(276,789)
|
|
---
|
|
2,521
|
|
|
Provision for loan losses
|
4,314
|
|
5,195
|
|
5,299
|
|
8,397
|
|
15,007
|
|
|
Net losses (gains) on loans held for sale
|
1,723
|
|
184
|
|
(6)
|
|
(916)
|
|
217
|
|
|
Investment securities gains
|
---
|
|
---
|
|
---
|
|
---
|
|
(38)
|
|
|
Losses (gains) on other real estate (ORE)
|
(596)
|
|
941
|
|
(173)
|
|
(385)
|
|
1,081
|
|
|
Merger-related expenses(1)
|
597
|
|
4,411
|
|
---
|
|
---
|
|
---
|
|
|
Fair-value adjustment on bank owned life insurance(2)
|
47
|
|
(31)
|
|
118
|
|
(205)
|
|
(100)
|
|
|
Fair-value adjustment on swaps (2)
|
(85)
|
|
83
|
|
74
|
|
(61)
|
|
(46)
|
|
|
Pre-tax pre-provision profit (non-GAAP)
|
$ 31,752
|
|
$ 33,048
|
|
$ 31,699
|
|
$ 31,691
|
|
$ 36,886
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)Merger-related expenses are contained in line item "Professional services" on Consolidated Statements of Operations.
|
|
(2)Fair-value adjustment amounts contained in line item "Other income" on Consolidated Statements of Operations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Income and Noninterest Expense
|
|
Three Months Ended
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
(in thousands)
|
|
2012
|
|
2012
|
|
2012
|
|
2012
|
|
2011
|
|
Service charges on deposit accounts
|
|
$ 9,414
|
|
$ 9,554
|
|
$ 9,355
|
|
$ 8,985
|
|
$ 9,724
|
|
Trust fees
|
|
3,782
|
|
3,635
|
|
3,582
|
|
3,602
|
|
3,747
|
|
Mortgage and other loan income
|
|
2,265
|
|
2,028
|
|
1,952
|
|
1,858
|
|
2,705
|
|
Brokerage and investment fees
|
|
1,569
|
|
1,831
|
|
1,331
|
|
1,324
|
|
1,243
|
|
Card-based and other nondeposit fees
|
|
4,367
|
|
4,431
|
|
4,444
|
|
4,265
|
|
4,305
|
|
Net gains (losses) on loans held for sale
|
|
(1,723)
|
|
(184)
|
|
6
|
|
916
|
|
(217)
|
|
Investment securities gains
|
|
---
|
|
---
|
|
---
|
|
---
|
|
38
|
|
Other income
|
|
2,350
|
|
2,415
|
|
1,675
|
|
3,290
|
|
2,818
|
|
Total noninterest income
|
|
$ 22,024
|
|
$ 23,710
|
|
$ 22,345
|
|
$ 24,240
|
|
$ 24,363
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits
|
|
$ 33,163
|
|
$ 33,589
|
|
$ 32,801
|
|
$ 33,298
|
|
$ 30,952
|
|
Occupancy
|
|
6,031
|
|
6,129
|
|
6,140
|
|
6,696
|
|
6,326
|
|
Professional services(1)
|
|
2,478
|
|
6,806
|
|
2,465
|
|
2,023
|
|
2,311
|
|
Equipment
|
|
2,858
|
|
2,937
|
|
2,904
|
|
3,303
|
|
3,326
|
|
Data processing services
|
|
4,521
|
|
4,427
|
|
3,721
|
|
4,048
|
|
3,709
|
|
Advertising and public relations
|
|
1,014
|
|
1,847
|
|
1,708
|
|
1,335
|
|
1,298
|
|
Postage and delivery
|
|
1,081
|
|
1,157
|
|
1,119
|
|
1,099
|
|
1,165
|
|
Other loan expenses
|
|
3,650
|
|
3,121
|
|
3,266
|
|
3,186
|
|
3,497
|
|
(Gains) losses on other real estate (ORE)
|
|
(596)
|
|
941
|
|
(173)
|
|
(385)
|
|
1,081
|
|
ORE expenses
|
|
220
|
|
323
|
|
266
|
|
450
|
|
995
|
|
Intangible asset amortization
|
|
484
|
|
513
|
|
545
|
|
578
|
|
688
|
|
Other expense
|
|
10,224
|
|
10,265
|
|
11,577
|
|
11,470
|
|
11,292
|
|
Total noninterest expense
|
|
$ 65,128
|
|
$ 72,055
|
|
$ 66,339
|
|
$ 67,101
|
|
$ 66,640
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)Includes merger-related expenses of $0.6 million and $4.4 million in the three months ended December 31, 2012 and September 30, 2012, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Balances, Yields and Rates
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
December 31, 2012
|
|
September 30, 2012
|
|
December 31, 2011
|
|
Average
|
Average
|
|
Average
|
Average
|
|
Average
|
Average
|
|
(in thousands)
|
Balance
|
Rate
|
|
Balance
|
Rate
|
|
Balance
|
Rate
|
|
Earning Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Money market investments
|
$ 232,209
|
0.25
|
%
|
|
$ 238,492
|
0.25
|
%
|
|
$ 273,714
|
0.25
|
%
|
|
Investment securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
|
2,610,899
|
2.23
|
|
|
2,557,793
|
2.51
|
|
|
2,481,094
|
3.00
|
|
|
Tax-exempt
|
200,671
|
6.44
|
|
|
205,572
|
6.46
|
|
|
225,093
|
6.53
|
|
|
FHLB and Federal Reserve stock
|
124,897
|
4.50
|
|
|
122,123
|
3.90
|
|
|
123,508
|
3.25
|
|
|
Portfolio loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
1,637,690
|
5.70
|
|
|
1,713,382
|
5.42
|
|
|
1,539,811
|
5.32
|
|
|
Commercial real estate
|
1,292,806
|
4.77
|
|
|
1,382,873
|
4.81
|
|
|
1,620,479
|
5.02
|
|
|
Residential mortgage
|
559,113
|
4.25
|
|
|
580,002
|
4.36
|
|
|
647,491
|
4.55
|
|
|
Direct consumer
|
855,386
|
5.69
|
|
|
873,057
|
5.81
|
|
|
943,445
|
5.98
|
|
|
Indirect consumer
|
972,776
|
5.99
|
|
|
952,086
|
6.05
|
|
|
881,206
|
6.58
|
|
|
Total portfolio loans
|
5,317,771
|
5.37
|
|
|
5,501,400
|
5.33
|
|
|
5,632,432
|
5.45
|
|
|
Loans held for sale
|
19,886
|
2.48
|
|
|
13,010
|
3.40
|
|
|
25,594
|
3.12
|
|
|
Total earning assets
|
8,506,333
|
4.27
|
|
|
8,638,390
|
4.36
|
|
|
8,761,435
|
4.59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonearning Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
144,432
|
|
|
|
145,961
|
|
|
|
141,138
|
|
|
|
Premises and equipment
|
91,260
|
|
|
|
92,775
|
|
|
|
98,526
|
|
|
|
Investment security fair value adjustment
|
58,234
|
|
|
|
54,807
|
|
|
|
46,065
|
|
|
|
Other nonearning assets
|
926,186
|
|
|
|
927,622
|
|
|
|
666,183
|
|
|
|
Allowance for loan losses
|
(121,998)
|
|
|
|
(135,968)
|
|
|
|
(190,163)
|
|
|
|
Total assets
|
$ 9,604,447
|
|
|
|
$ 9,723,587
|
|
|
|
$ 9,523,184
|
|
|
|
Interest-Bearing Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand deposits
|
$ 1,067,575
|
0.12
|
|
|
$ 1,073,294
|
0.13
|
|
|
$ 937,024
|
0.18
|
|
|
Savings deposits
|
2,572,107
|
0.18
|
|
|
2,602,216
|
0.20
|
|
|
2,645,821
|
0.31
|
|
|
Time deposits
|
1,741,846
|
1.53
|
|
|
1,825,144
|
1.55
|
|
|
2,269,233
|
1.73
|
|
|
Short-term borrowings
|
44,817
|
0.10
|
|
|
45,974
|
0.10
|
|
|
45,020
|
0.19
|
|
|
Long-term debt
|
851,723
|
3.93
|
|
|
852,776
|
3.89
|
|
|
856,206
|
4.12
|
|
|
Total interest-bearing liabilities
|
6,278,068
|
1.05
|
|
|
6,399,404
|
1.06
|
|
|
6,753,304
|
1.25
|
|
|
Noninterest-Bearing Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand
|
1,800,126
|
|
|
|
1,823,099
|
|
|
|
1,600,059
|
|
|
|
Other liabilities
|
162,003
|
|
|
|
155,267
|
|
|
|
152,739
|
|
|
|
Shareholders' equity
|
1,364,250
|
|
|
|
1,345,817
|
|
|
|
1,017,082
|
|
|
|
Total liabilities and shareholders' equity
|
$ 9,604,447
|
|
|
|
$ 9,723,587
|
|
|
|
$ 9,523,184
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Spread
|
|
3.22
|
%
|
|
|
3.29
|
%
|
|
|
3.33
|
%
|
|
Contribution of noninterest bearing sources of funds
|
|
0.28
|
|
|
|
0.28
|
|
|
|
0.29
|
|
|
Net Interest Margin
|
|
3.50
|
%
|
|
|
3.57
|
%
|
|
|
3.62
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Balances, Yields and Rates
|
|
Twelve Months Ended
|
|
|
December 31,
|
|
|
2012
|
|
2011
|
|
|
Average
|
Average
|
|
|
Average
|
Average
|
|
|
(in thousands)
|
|
Balance
|
Rate
|
|
|
Balance
|
Rate
|
|
|
Earning Assets
|
|
|
|
|
|
|
|
|
|
Money market investments
|
|
$ 251,169
|
0.25
|
%
|
|
$ 340,482
|
0.25
|
%
|
|
Investment securities:
|
|
|
|
|
|
|
|
|
|
Taxable
|
|
2,573,740
|
2.48
|
|
|
2,444,539
|
3.24
|
|
|
Tax-exempt
|
|
207,726
|
6.45
|
|
|
250,098
|
6.64
|
|
|
FHLB and Federal Reserve stock
|
|
121,107
|
4.04
|
|
|
132,101
|
3.14
|
|
|
Portfolio loans:
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
1,647,813
|
5.54
|
|
|
1,438,292
|
5.13
|
|
|
Commercial real estate
|
|
1,415,141
|
4.92
|
|
|
1,776,292
|
5.12
|
|
|
Residential mortgage
|
|
591,946
|
4.32
|
|
|
700,257
|
4.65
|
|
|
Direct consumer
|
|
884,745
|
5.82
|
|
|
981,396
|
6.04
|
|
|
Indirect consumer
|
|
921,429
|
6.15
|
|
|
856,279
|
6.65
|
|
|
Total portfolio loans
|
|
5,461,074
|
5.40
|
|
|
5,752,516
|
5.45
|
|
|
Loans held for sale
|
|
14,091
|
3.28
|
|
|
26,451
|
3.52
|
|
|
Total earning assets
|
|
8,628,907
|
4.38
|
|
|
8,946,187
|
4.64
|
|
|
Nonearning Assets
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
143,639
|
|
|
|
142,721
|
|
|
|
Premises and equipment
|
|
93,953
|
|
|
|
101,009
|
|
|
|
Investment security fair value adjustment
|
|
54,149
|
|
|
|
44,712
|
|
|
|
Other nonearning assets
|
|
795,051
|
|
|
|
663,477
|
|
|
|
Allowance for loan losses
|
|
(145,566)
|
|
|
|
(228,509)
|
|
|
|
Total assets
|
|
$ 9,570,133
|
|
|
|
$ 9,669,597
|
|
|
|
Interest-Bearing Liabilities
|
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand deposits
|
|
$ 1,026,098
|
0.14
|
|
|
$ 953,187
|
0.21
|
|
|
Savings deposits
|
|
2,639,803
|
0.22
|
|
|
2,636,422
|
0.35
|
|
|
Time deposits
|
|
1,902,397
|
1.58
|
|
|
2,489,703
|
1.85
|
|
|
Short-term borrowings
|
|
41,676
|
0.13
|
|
|
42,760
|
0.18
|
|
|
Long-term debt
|
|
852,932
|
3.94
|
|
|
898,501
|
4.15
|
|
|
Total interest-bearing liabilities
|
|
6,462,906
|
1.10
|
|
|
7,020,573
|
1.35
|
|
|
Noninterest-Bearing Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand
|
|
1,747,544
|
|
|
|
1,503,430
|
|
|
|
Other liabilities
|
|
158,816
|
|
|
|
151,833
|
|
|
|
Shareholders' equity
|
|
1,200,867
|
|
|
|
993,761
|
|
|
|
Total liabilities and shareholders' equity
|
|
$ 9,570,133
|
|
|
|
$ 9,669,597
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Spread
|
|
|
3.28
|
%
|
|
|
3.29
|
%
|
|
Contribution of noninterest bearing sources of funds
|
|
|
0.28
|
|
|
|
0.29
|
|
|
Net Interest Margin
|
|
|
3.56
|
%
|
|
|
3.58
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE Citizens Republic Bancorp, Inc.