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TriCo Bancshares Announces Quarterly Results

TCBK | July 28, 2016

TriCo Bancshares (NASDAQ: TCBK) (the "Company"), parent company of Tri Counties Bank, today announced earnings of $9,405,000, or $0.41 per diluted share, for the three months ended June 30, 2016. For the three months ended June 30, 2015 the Company reported earnings of $11,366,000, or $0.49 per diluted share. Diluted shares outstanding were 23,070,151 and 22,980,033 for the three months ended June 30, 2016 and 2015, respectively.

The Company’s results for the three months ended June 30, 2016 include an accrual of $1,450,000 in expenses associated with employment-related legal proceedings previously disclosed by the Company under the heading “Legal Proceedings” in several of the Company’s recent periodic reports filed with the U.S. Securities and Exchange Commission. Also included in the results of the Company for the three months ended June 30, 2016 was $162,000 of nonrecurring noninterest expense related to the Company’s acquisition of three bank branches from Bank of America on March 18, 2016. Excluding the legal proceedings expense and nonrecurring merger related expense noted above, diluted earnings per share for the three months ended June 30, 2016 would have been higher by $0.04 than reported above, and earnings would have been $10,340,000 for the three months ended June 30, 2016. There were no nonrecurring expenses recorded during the three months ended June 30, 2015. In addition to the legal proceedings expense and nonrecurring merger related expense noted above, there were other expense and revenue items during the three months ended June 30, 2016 and 2015 that may be considered nonrecurring, and these items are described below in various sections of this announcement.

The following is a summary of the components of the Company’s consolidated net income, average common shares, and average diluted common shares outstanding for the periods indicated:


	Three months ended
	June 30,
(dollars and shares in thousands)	2016			2015			$ Change			% Change
Net Interest Income	$	41,160		$	38,521		$	2,639		6.9	%
Reversal of provision for loan losses		773			633			140
Noninterest income		11,245			12,080			(835	)	(6.9	%)
Noninterest expense		(38,267	)		(32,436	)		(5,831	)	18.0	%
Provision for income taxes		(5,506	)		(7,432	)		1,926		(25.9	%)
Net income	$	9,405		$	11,366			($1,961	)	(17.3	%)

Average common shares		22,803			22,745			58		0.3	%
Average diluted common shares		23,070			22,980			90		0.4	%

The following is a summary of certain of the Company’s consolidated assets and deposits as of the dates indicated:


Ending balances	As of June 30,
($'s in thousands)	2016		2015		$ Change		% Change
Total assets	$	4,352,492	$	3,893,855	$	458,637	11.8	%
Total loans		2,653,630		2,393,762		259,868	10.9	%
Total investments		1,220,385		1,077,669		142,716	13.2	%
Total deposits	$	3,741,396	$	3,341,682	$	399,714	12.0	%


Qtrly Avg balances	As of June 30,
($'s in thousands)	2016		2015		$ Change		% Change
Total assets	$	4,387,950	$	3,894,196	$	493,754	12.7	%
Total loans		2,579,774		2,355,864		223,910	9.5	%
Total investments		1,211,556		1,064,142		147,414	13.9	%
Total deposits	$	3,778,436	$	3,347,874	$	430,562	12.9	%

Included in the changes in the Company’s deposits from June 30, 2015 to June 30, 2016 is the addition of a $45 million certificate of deposit from the State of California on September 16, 2015, bringing the total of such certificates of deposit from the State of California to $50 million, and the addition of deposits from the acquisition of three bank branches from Bank of America, that totaled $161 million on the date of acquisition, March 18, 2016.

On March 18, 2016, Tri Counties Bank acquired three branches from Bank of America. The branches are located in the cities of Arcata, Eureka, and Fortuna in Humboldt County, California. The Bank paid $3,204,000 for deposit relationships with balances of $161,231,000 and loans with balances of $289,000.

The following table discloses the fair value of consideration transferred, the total identifiable net assets acquired and the resulting goodwill relating to the acquisition of three branch banking offices and certain deposits from Bank of America on March 18, 2016:


(in thousands)	March 18, 2016
Fair value of consideration transferred:
Cash consideration	$	3,204
Total fair value of consideration		3,204
Asset acquired:
Cash and cash equivalents		159,520
Loans		289
Premises and equipment		1,590
Core deposit intangible		2,046
Other assets		141
Total assets acquired		163,586
Liabilities assumed:
Deposits		161,231
Total liabilities assumed		161,231
Total net assets acquired		2,355
Goodwill recognized	$	849

Also impacting the Company’s results of operations for the three months ended June 30, 2016 is the impact of the sale, on March 31, 2016, of twenty-seven nonperforming loans, nine substandard performing loans, and three purchased credit impaired loans with total recorded book value of approximately $24,810,000, and the purchase, on May 19, 2016 of seven performing multi-family commercial real estate loans valued at $22,503,000.

Loans acquired through purchase, or acquisition of other banks, are classified by the Company as Purchased Not Credit Impaired (PNCI), Purchased Credit Impaired – cash basis (PCI – cash basis), or Purchased Credit Impaired – other (PCI – other). Loans not acquired in an acquisition or otherwise “purchased” are classified as “originated”. Often, such purchased loans are purchased at a discount to face value, and part of this discount is accreted into (added to) interest income over the remaining life of the loan. A loans may also be purchased at a premium to face value, in which case, the premium is amortized into (subtracted from) interest income over the remaining life of the loan. Generally, as time goes on, the effects of loan discount accretion and loan premium amortization decrease as the purchased loans mature or pay off early. Upon the early pay off of a loan, any remaining (unaccreted) discount or (unamortized) premium is immediately taken into interest income; and as loan payoffs may vary significantly from quarter to quarter, so may the impact of discount accretion and premium amortization on interest income. Further details regarding interest income from loans, including fair value discount accretion, may be found under the heading “Supplemental Loan Interest Income Data” in the Consolidated Financial Data table at the end of this press release.

The Company’s primary source of revenue is net interest income, or the difference between interest income on interest-earning assets and interest expense on interest-bearing liabilities. Following is a summary of the components of net interest income for the periods indicated (dollars in thousands):


	Three months ended
	June 30,
	2016			2015
Interest income	$	42,590		$	39,867
Interest expense		(1,430	)		(1,346	)
FTE adjustment		585			194
Net interest income (FTE)	$	41,745		$	38,715
Net interest margin (FTE)		4.13	%		4.35	%
Purchased loan discount accretion	$	2,300		$	2,133
Effect of purchased loan discount accretion on net interest margin (FTE)		0.23	%		0.24	%

Net interest income (FTE) during the three months ended June 30, 2016 increased $3,030,000 (7.8%) from the same period in 2015 to $41,745,000. The increase in net interest income (FTE) was primarily due to a $223,910,000 (9.5%) increase in the average balance of loans to $2,579,774,000, and a $147,414,000 (13.9%) increase in the average balance of investments to $1,211,556,000 that were partially offset by a 12 basis point decrease in the average yield on loans from 5.44% during the three months ended June 30, 2015 to 5.32% during the three months ended June 30, 2016, and an 16 basis point decrease in the average yield on investments from 2.97% during the three months ended June 30, 2015 to 2.81% during the three months ended June 30, 2016. The decrease in average loan yields is primarily due to declines in market yields on new and renewed loans compared to yields on repricing, maturing, and paid off loans. The decrease in average investment yields is primarily due to declines in market yields on new investments compared to yields on existing investments, and to recent declines in mortgage rates that lead to an increase in mortgage refinancing activity that in turn lead to faster estimated mortgage prepayment speeds and an accelerated level of interest income-reducing premium amortization on existing mortgage backed investment securities. The increases in average loan and investment balances added $3,045,000 and $1,457,000, respectively, to net interest income (FTE) while the decreases in average loan and investment yields reduced net interest income (FTE) by $726,000 and $850,000, respectively, when compared to the year-ago quarter. Included in interest income during the three months ended June 30, 2015 was a special cash dividend of $626,000 from the Company’s investment in Federal Home Loan Bank stock, and $2,133,000 of discount accretion from purchased loans compared to $2,300,000 of discount accretion from purchased loans during the three months ended June 30, 2016. For more information related to loan interest income, including loan purchase discount accretion, see the Supplemental Loan Interest Income Data in the tables at the end of this announcement.

The following table shows the components of net interest income and net interest margin on a fully tax-equivalent (FTE) basis for the periods indicated:


ANALYSIS OF CHANGE IN NET INTEREST MARGIN ON EARNING ASSETS
(unaudited, dollars in thousands)
	Three Months Ended							Three Months Ended							Three Months Ended
	June 30, 2016							March 31, 2016							June 30, 2015
	Average		Income/			Yield/		Average		Income/			Yield/		Average		Income/			Yield/
	Balance		Expense			Rate		Balance		Expense			Rate		Balance		Expense			Rate
Assets
Earning assets
Loans	$	2,579,774	$	34,338		5.32	%	$	2,537,574	$	34,738		5.48	%	$	2,355,864	$	32,019		5.44	%
Investments - taxable		1,085,230		6,945		2.56	%		1,068,018		6,920		2.59	%		1,020,806		7,380		2.89	%
Investments - nontaxable		126,326		1,560		4.94	%		116,088		1,435		4.94	%		43,336		518		4.78	%
Cash at Federal Reserve and other banks		247,398		332		0.54	%		155,106		239		0.62	%		143,919		144		0.40	%
Total earning assets		4,038,728		43,175		4.28	%		3,876,786		43,332		4.47	%		3,563,925		40,061		4.50	%
Other assets, net		349,222							335,602							330,271
Total assets	$	4,387,950						$	4,212,388						$	3,894,196
Liabilities and shareholders' equity
Interest-bearing
Demand deposits	$	886,417		120		0.05	%	$	846,189		116		0.05	%	$	796,958		116		0.06	%
Savings deposits		1,354,846		423		0.12	%		1,274,868		397		0.12	%		1,165,530		362		0.12	%
Time deposits		350,215		338		0.39	%		340,847		342		0.40	%		336,212		376		0.45	%
Other borrowings		19,152		3		0.06	%		18,264		2		0.04	%		7,894		1		0.06	%
Trust preferred securities		56,544		546		3.86	%		56,494		535		3.79	%		56,344		491		3.49	%
Total interest-bearing liabilities		2,667,174		1,430		0.21	%		2,536,662		1,392		0.22	%		2,362,938		1,346		0.23	%
Noninterest-bearing deposits		1,186,958							1,154,714							1,049,174
Other liabilities		62,456							59,492							51,483
Shareholders' equity		471,362							461,520							430,601
Total liabilities and shareholders' equity	$	4,387,950						$	4,212,388						$	3,894,196
Net interest rate spread						4.07	%						4.25	%						4.27	%
Net interest income/net interest margin (FTE)				41,745		4.13	%				41,940		4.33	%				38,715		4.35	%
FTE adjustment				(585	)						(538	)						(194	)
Net interest income (not FTE)			$	41,160						$	41,402						$	38,521

The Company recorded a reversal of provision for loan losses of $773,000 during the three months ended June 30, 2016 compared to a reversal of provision for loan losses of $633,000 during the three months ended June 30, 2015. The $773,000 reversal of provision for loan losses during the three months ended June 30, 2016 was due to a $879,000 decrease in the required allowance for loan losses from $36,388,000 at March 31, 2016 to $35,509,000 at June 30, 2016 that was partially offset by net loan charge offs of $106,000. The decrease in the required allowance for loan losses from March 31, 2016 to June 30, 2016 was primarily due to pay downs on certain nonperforming loans that had significant loss allowances assigned to them, and are now no longer required or are significantly reduced; that was partially offset by a $112,083,000 increase in loan balances from $2,541,547,000 at March 31, 2016 to $2,653,630,000 at June 30, 2016. During the three months ended June 30, 2016 nonperforming loans decreased $4,057,000 (16.9%) to $19,977,000, and represented a decrease from 1.47% of loans outstanding as of December 31, 2015, and 0.95% of loans outstanding at March 31, 2016, to 0.75% of loans outstanding as of June 30, 2016. The decrease in nonperforming loans was primarily due to the sale of nonperforming loans during the three months ended March 31, 2016, and the pay down of nonperforming loans during the three months ended June 30, 2016.

The following table presents the key components of noninterest income for the periods indicated:


	Three months ended
	June 30,
(dollars in thousands)	2016			2015			$ Change			% Change
Service charges on deposit accounts	$	3,543		$	3,637			($94	)	(2.6	%)
ATM fees and interchange		3,892			3,383			509		15.0	%
Other service fees		849			779			70		9.0	%
Mortgage banking service fees		516			528			(12	)	(2.3	%)
Change in value of mortgage servicing rights		(701	)		521			(1,222	)	(234.5	%)
Total service charges and fees		8,099			8,848			(749	)	(8.5	%)

Gain on sale of loans		889			837			52		6.2	%
Commission on NDIP		611			784			(173	)	(22.1	%)
Increase in cash value of life insurance		681			675			6		0.9	%
Change in indemnification asset		(149	)		(57	)		(92	)	161.4	%
Gain on sale of foreclosed assets		57			115			(58	)	(50.4	%)
Other noninterest income		1,057			878			179		20.4	%
Total other noninterest income		3,146			3,232			(86	)	(2.7	%)
Total noninterest income	$	11,245		$	12,080			($835	)	(6.9	%)

Noninterest income decreased $835,000 (6.9%) to $11,245,000 during the three months ended June 30, 2016 compared to the three months ended June 30, 2015. The decrease in noninterest income was primarily due to a $1,222,000 decrease in change in value of mortgage servicing rights (MSRs) to a negative $701,000 from a positive $521,000 in the year-ago quarter. A decrease in interest rates during the three months ended June 30, 2016 resulted in an increase in estimated prepayment speeds of serviced loans, that in turn resulted in a decrease in expected servicing cash flows, and thus, a lower value of such servicing rights. In the year-ago quarter, an increase in interest rates resulted in a decrease in estimated prepayment speeds of serviced loans that in turn resulted in an increase in expected servicing cash flows, and thus, a higher value of such servicing rights. Partially offsetting the decrease in change in value of mortgage servicing rights was a $509,000 (15.0%) increase in ATM fees and interchange revenue. The increase in ATM fees and interchange revenue was primarily due to the Company’s increased focus in this area, including the introduction of new services in this area during the quarter ended March 31, 2016. Other noninterest interest income increased $179,000 (20.4%) to $1,057,000 due to life insurance death benefits in excess of cash value of $238,000 that was partially offset by decreases in other items in this category during the three months ended June 30, 2016. The changes in noninterest income include the effects from the operation of three branches, including $161,231,000 of deposits, acquired from Bank of America on March 18, 2016.

The following table presents the key components of the Company’s noninterest expense for the periods indicated:



	Three months ended
	June 30,
(dollars in thousands)	2016		2015		$ Change			% Change
Base salaries, overtime and temporary help, net of deferred loan orgination costs	$	12,968	$	11,502	$	1,466		12.7	%
Commissions and incentives		2,471		1,390		1,081		77.8	%
Employee benefits		4,606		4,350		256		5.9	%
Total salaries and benefits expense		20,045		17,242		2,803		16.3	%

Occupancy		2,529		2,541		(12	)	(0.5	%)
Equipment		1,844		1,527		317		20.8	%
Change in reserve for unfunded commitments		408		110		298		270.9	%
Data processing and software		2,355		1,834		521		28.4	%
Telecommunications		698		785		(87	)	(11.1	%)
ATM network charges		1,002		985		17		1.7	%
Professional fees		1,356		1,035		321		31.0	%
Advertising and marketing		1,077		1,002		75		7.5	%
Postage		342		330		12		3.6	%
Courier service		265		253		12		4.7	%
Intangible amortization		359		289		70		24.2	%
Operational losses		345		149		196		131.5	%
Provision for foreclosed asset losses		42		174		(132	)	(75.9	%)
Foreclosed asset expense		114		102		12		11.8	%
Assessments		578		694		(116	)	(16.7	%)
Merger and acquisition expense		162		-		162
Legal settlement		1,450		-		1,450
Miscellaneous other expense		3,296		3,384		(88	)	(2.6	%)
Total other noninterest expense		18,222		15,194		3,028		19.9	%
Total noninterest expense	$	38,267	$	32,436	$	5,831		18.0	%

Average full time equivalent employees		1,001		944		57		6.0	%

Salary and benefit expenses increased $2,803,000 (16.3%) to $20,045,000 during the three months ended June 30, 2016 compared to $17,242,000 during the three months ended June 30, 2015. Base salaries, overtime and temporary help, net of deferred loan origination costs increased $1,466,000 (12.7%) to $12,968,000 of which base salaries and overtime, net of deferred loan origination costs increased $1,276,000 (11.1%) to $12,774,000 primarily due to annual merit increases, and an increase in average full-time equivalent employees of 57 (6.0%) to 1,001 for the three months ended June 30, 2016. Temporary help expense increased $189,000 to $194,000 during the three months ended June 30, 2016. The increase in temporary help was primarily due to the use of temporary help in the Company’s customer service call center during the three months ended June 30, 2016. Incentive compensation increased 1,081,000 (77.8%) to $2,471,000 during the three months ended June 30, 2016. All categories of incentive compensation expense were higher than the year-ago quarter except commission expense related to the sale of nondeposit investment products. The increases in the other categories of incentive compensation, compared to the year-ago quarter, were primarily due to increased loan production and other performance measures to which incentive compensation is tied compared to such measures in the year-ago quarter. Benefits & other compensation expense increased 256,000 (5.9%) to $4,606,000 during the three months ended June 30, 2016 primarily due to the increases in average full-time equivalent employees and salaries expense, and their effects on group insurance and employer payroll tax expenses.

Other noninterest expense increased $3,028,000 (19.9%) to $18,222,000 during the three months ended June 30, 2016 compared to the three months ended June 30, 2015. Included in other noninterest expense for the three months ended June 30, 2016 was the legal settlement expense of $1,450,000 as described above. Also contributing to the increase in other noninterest expense during the three months ended June 30, 2016 compared to the three months ended June 30, 2015 were a $521,000 (28.4%) increase in data processing and software expense, a $321,000 (31.0%) increase in professional fees, a $317,000 (20.8%) increase in equipment expense, and a $298,000 (271%) increase in provision for losses on unfunded commitments. The increase in data processing and software expense was primarily due to increased use of outside data processing services. The increase in professional fees was primarily due to increased consulting expense. The increase in equipment expense was primarily due to increase maintenance and repair expense associated with facilities maintenance. The increase in provision for losses on unfunded commitments was primarily due to a larger increase in unfunded construction loan commitments from March 31, 2016 to June 30, 2016 than from March 31, 2015 to June 30, 2015. Merger related expenses during the three months ended June 30, 2016 were $162,000, and consisted of consulting expenses related to the acquisition of three bank branches from B of A on March 18, 2016. There were no merger related expenses during the three months ended June 30, 2015.

Richard Smith, President and CEO of the Company commented, “While net income was negatively affected by recognition of legal expenses related to previously disclosed pending litigation, changes in mortgage servicing income due to lower interest rates, expenses related to core systems conversions and expenses related to our acquisition of three Bank of America branches, we experienced many positives from the quarter. Ending year over year balances were strong positives for the quarter. Total assets increased by 11.8% from a June 30, 2015 to June 30, 2016. Total loans increased year over year by over 10.9%. Loan quality also improved as nonperforming loans decreased from $39,880,000 on June 30, 2015 to $19,997,000 on June 30, 2016. Bank deposits, including deposits from the Bank of America branch acquisition, increased year over year by 12%.

Smith added, “We continue to move forward with our ambitious technology plans to upgrade our on-line products and core processing systems to better serve our customers. Completion of these projects is expected in the fall of 2016. This investment into new computer solutions will improve operational efficiencies and provide customers with added convenience and improved self-service banking options.”

In addition to the historical information contained herein, this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to various uncertainties and risks that could affect their outcome. The Company’s actual results could differ materially. Factors that could cause or contribute to such differences include, but are not limited to, variances in the actual versus projected growth in assets, return on assets, interest rate fluctuations, economic conditions in the Company's primary market area, demand for loans, regulatory and accounting changes, loan losses, expenses, rates charged on loans and earned on securities investments, rates paid on deposits, competitive effects, fee and other noninterest income earned, the outcome of litigation, as well as other factors detailed in the Company's reports filed with the Securities and Exchange Commission which are incorporated herein by reference, including the Form 10-K for the year ended December 31, 2015. These reports and this entire press release should be read to put such forward-looking statements in context and to gain a more complete understanding of the uncertainties and risks involved in the Company's business. The Company does not intend to update any of the forward-looking statements after the date of this release.

Established in 1975, Tri Counties Bank is a wholly-owned subsidiary of TriCo Bancshares (NASDAQ: TCBK) headquartered in Chico, California, providing a unique brand of customer Service with Solutions available in traditional stand-alone and in-store bank branches in communities throughout Northern and Central California. Tri Counties Bank provides an extensive and competitive breadth of consumer, small business and commercial banking financial services, along with convenient around-the-clock ATM, online and mobile banking access. Brokerage services are provided by the Bank’s investment services through affiliation with Raymond James Financial Services, Inc. Visit www.TriCountiesBank.com to learn more.


TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA
(Unaudited. Dollars in thousands, except share data)
	Three months ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2016			2016			2015			2015			2015
Statement of Income Data
Interest income	$	42,590		$	42,794		$	42,490		$	41,332		$	39,867
Interest expense		1,430			1,392			1,349			1,339			1,346
Net interest income		41,160			41,402			41,141			39,993			38,521
(Benefit from reversal of) provision for loan losses		(773	)		209			(908	)		(866	)		(633	)
Noninterest income:
Service charges and fees		8,099			7,305			7,935			7,694			8,848
Other income		3,146			2,485			3,510			3,948			3,232
Total noninterest income		11,245			9,790			11,445			11,642			12,080
Noninterest expense:
Base salaries net of deferred loan origination costs		12,968			12,708			12,014			11,562			11,502
Incentive compensation expense		2,471			1,739			2,304			1,674			1,390
Employee benefits and other compensation expense		4,606			4,818			4,212			4,297			4,350
Total salaries and benefits expense		20,045			19,265			18,530			17,533			17,242
Other noninterest expense		18,222			14,486			16,154			13,906			15,194
Total noninterest expense		38,267			33,751			34,684			31,439			32,436
Income before taxes		14,911			17,232			18,810			21,062			18,798
Net income	$	9,405		$	10,674		$	11,422		$	12,694		$	11,366
Share Data
Basic earnings per share	$	0.41		$	0.47		$	0.50		$	0.56		$	0.50
Diluted earnings per share	$	0.41		$	0.46		$	0.50		$	0.55		$	0.49
Book value per common share	$	20.76		$	20.34		$	19.85		$	19.48		$	18.95
Tangible book value per common share	$	17.63		$	17.18		$	16.81		$	16.42		$	15.88
Shares outstanding		22,822,325			22,785,173			22,775,173			22,764,295			22,749,523
Weighted average shares		22,802,653			22,782,865			22,769,793			22,757,453			22,744,926
Weighted average diluted shares		23,070,151			23,046,165			23,055,900			23,005,980			22,980,033
Credit Quality
Nonperforming originated loans	$	10,022		$	12,660		$	22,824		$	24,052		$	23,812
Total nonperforming loans		19,977			24,034			37,119			38,898			39,880
Foreclosed assets, net of allowance		3,842			4,471			5,369			5,285			5,393
Loans charged-off		641			1,289			380			687			514
Loans recovered	$	536		$	1,457		$	781		$	2,616		$	547
Selected Financial Ratios
Return on average total assets		0.86	%		1.01	%		1.11	%		1.28	%		1.17	%
Return on average equity		7.98	%		9.25	%		10.14	%		11.56	%		10.56	%
Average yield on loans		5.32	%		5.48	%		5.60	%		5.57	%		5.44	%
Average yield on interest-earning assets		4.28	%		4.47	%		4.53	%		4.60	%		4.50	%
Average rate on interest-bearing liabilities		0.21	%		0.22	%		0.22	%		0.23	%		0.23	%
Net interest margin (fully tax-equivalent)		4.13	%		4.33	%		4.39	%		4.46	%		4.35	%
Supplemental Loan Interest Income Data:
Discount accretion PCI - cash basis loans	$	426		$	269		$	302		$	445		$	404
Discount accretion PCI - other loans		415			(45	)		1,392			1,090			907
Discount accretion PNCI loans		1,459			868			573			1,590			822
All other loan interest income		32,038			33,646			32,571			30,689			29,886
Total loan interest income	$	34,338		$	34,738		$	34,838		$	33,814		$	32,019


TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA
(Unaudited. Dollars in thousands)
	Three months ended
	June 30,			March 31,			December 31,			September 30,			June 30,
Balance Sheet Data	2016			2016			2015			2015			2015
Cash and due from banks	$	216,786		$	388,878		$	303,461		$	209,298		$	169,503
Securities, available for sale		529,017			477,454			404,885			329,361			284,430
Securities, held to maturity		674,412			705,133			726,530			751,051			776,283
Restricted equity securities		16,956			16,956			16,956			16,956			16,956
Loans held for sale		2,904			2,240			1,873			5,152			4,630
Loans:
Commercial loans		209,840			197,695			194,913			199,330			195,791
Consumer loans		381,114			401,076			395,283			403,081			411,788
Real estate mortgage loans		1,913,024			1,813,933			1,811,832			1,757,082			1,686,567
Real estate construction loans		149,652			128,843			120,909			110,073			99,616
Total loans, gross		2,653,630			2,541,547			2,522,937			2,469,566			2,393,762
Allowance for loan losses		(35,509	)		(36,388	)		(36,011	)		(36,518	)		(35,455	)
Foreclosed assets		3,842			4,471			5,369			5,285			5,393
Premises and equipment		51,728			51,522			43,811			42,334			42,056
Cash value of life insurance		94,572			95,256			94,560			94,458			93,687
Goodwill		64,311			64,311			63,462			63,462			63,462
Other intangible assets		7,282			7,641			5,894			6,184			6,473
Mortgage servicing rights		6,720			7,140			7,618			7,467			7,814
Accrued interest receivable		11,602			11,075			10,786			10,212			10,064
Other assets		54,239			57,720			48,591			47,360			54,797
Total assets	$	4,352,492			4,394,956			4,220,722			4,021,628			3,893,855
Deposits:
Noninterest-bearing demand deposits		1,181,702			1,178,001			1,155,695			1,100,607			1,060,650
Interest-bearing demand deposits		867,638			884,638			853,961			817,034			780,647
Savings deposits		1,346,269			1,368,644			1,281,540			1,187,238			1,179,836
Time certificates		345,787			353,757			340,070			352,993			320,549
Total deposits		3,741,396			3,785,040			3,631,266			3,457,872			3,341,682
Accrued interest payable		727			751			774			795			797
Reserve for unfunded commitments		2,883			2,475			2,475			2,085			2,125
Other liabilities		57,587			68,064			65,293			53,681			55,003
Other borrowings		19,464			18,671			12,328			6,859			6,735
Junior subordinated debt		56,567			56,519			56,470			56,991			56,369
Total liabilities		3,878,624			3,931,520			3,768,606			3,578,283			3,462,711
Total shareholders' equity		473,868			463,436			452,116			443,345			431,144
Accumulated other comprehensive gain (loss)		6,073			1,772			(1,778	)		(2,298	)		(4,726	)
Average loans		2,579,774			2,537,574			2,489,406			2,427,670			2,355,864
Average interest-earning assets		4,038,728			3,876,786			3,777,144			3,616,912			3,563,925
Average total assets		4,387,950			4,212,388			4,115,369			3,953,292			3,894,196
Average deposits		3,778,436			3,616,618			3,543,423			3,390,229			3,347,874
Average total equity	$	471,362		$	461,520		$	450,413		$	439,360		$	430,601
Total risk based capital ratio		14.7	%		15.1	%		15.1	%		15.2	%		15.2	%
Tier 1 capital ratio		13.6	%		13.9	%		13.8	%		13.9	%		13.9	%
Tier 1 common equity ratio		12.0	%		12.3	%		12.2	%		12.3	%		12.2	%
Tier 1 leverage ratio		10.4	%		10.7	%		10.8	%		11.0	%		10.9	%
Tangible capital ratio		9.4	%		9.1	%		9.2	%		9.5	%		9.4	%