ITASCA, IL--(Marketwire - April 23, 2008) - First Midwest Bancorp, Inc. (
NASDAQ:
FMBI)
1st QUARTER HIGHLIGHTS:
-- Strong Profitability: ROA of 1.25%, ROE of 13.75%
-- Commercial Loan Growth: 9.1% Annualized
-- Stable Net Margin: 3.53%
-- Controlled Expense Growth: 2.5%
-- Loan Loss Provisions Expanded
First Midwest Bancorp, Inc. (the "Company" or "First Midwest") (
NASDAQ:
FMBI), the holding company of First Midwest Bank, today reported results of
operations and financial condition for first quarter 2008. First Midwest
Chairman and Chief Executive Officer, John M. O'Meara reported, "The
Company's net income for first quarter 2008 was $25.0 million, or $0.52 per
diluted share, as compared to 2007's first quarter earnings of $29.0
million, or $0.58 per diluted share. Return on average equity was 13.75%
for first quarter 2008 and 15.48% for first quarter 2007. Return on
average assets was 1.25% and 1.42% for first quarter 2008 and 2007,
respectively."
O'Meara further commented, "Performance for the first quarter was
influenced by a number of counterbalancing economic events against a
backdrop of aggressive Federal Reserve actions to lower interest rates and
provide liquidity to the stalled financial markets. The negative trends in
the residential development markets presented challenges within the
quarter. Concentrated in the Chicagoland market, residential development
represents a business in which we have been profitably engaged for more
than 20 years and represents 15% of our $2.7 billion construction and real
estate development portfolio. A number of clients in this area have been
caught up in the cycle of deteriorating cash flows making timely payments
of outstanding obligations untenable. We have worked aggressively to
remediate these problems, which is manifested in higher credit charges, in
valuation reserve expansion, in Other Real Estate Owned designations, and
in ninety-day past due totals. We remain fully engaged with these
customers and this marketplace as this economic circumstance unfolds.
Apart from these portfolios, we are experiencing good progress in
commercial sales activity, which is expanding loan balances at a 9.1% rate.
Our asset management business continues to prosper. We noted a milestone
in the first quarter with more then $4.0 billion under management, making
us the fifth largest manager in the State of Illinois and placing us in the
top sixty in the country."
BALANCE SHEET DISCUSSION:
Loan Portfolio:
Total loans outstanding at March 31, 2008 were up $52.1 million from a year
ago and up $82.1 million from December 31, 2007, an annualized increase of
6.6%, which is diminished by the inclusion of loan payments on discontinued
lines of business. The increase since December 2007 was led by growth in
commercial real estate and commercial and industrial categories and
reflects the economic strength and diversity in the Chicago metropolitan
area. Average core deposits for the quarter were up $47.8 million from
first quarter 2007. Growth was primarily in the Company's savings products
while average core deposits were down $37.1 million from fourth quarter
2007, reflecting a normal seasonal decline.
Credit Quality:
The Company's net loan charge-offs as a percent of average loans was 0.49%
for first quarter 2008. This was an increase from the Company's historic
lows of the past 2 years. Nonperforming assets plus loans past due 90 days
as a percent of total loans plus foreclosed real estate was 1.17% at March
31, 2008 and 0.92% at December 31, 2007. The loan loss reserve as a
percent of total loans was 1.28% at March 31, 2008, as compared to 1.25% at
both March 31, 2007 and December 31, 2007. The provision for loan losses
was increased above first quarter charge-offs by approximately $3.0 million
providing additional protection against the uncertain duration and depth of
residential real estate problems. The loan loss reserve represents more
than 375% of nonperforming loans, which is an increase from December 31,
2007 levels of 330%.
Margin Performance:
Net interest margin for first quarter 2008 remained unchanged from fourth
quarter 2007 and first quarter 2007 at 3.53%. With approximately one-half
of the Company's loan portfolio tied to floating indices, the 200 basis
point decline during first quarter 2008 in the Federal Reserve's discount
rate resulted in a decline of 58 basis points in average loan yields from
fourth quarter 2007. This negative impact was offset by a decline in our
short-term wholesale borrowing rates, a decline in the rates paid on
portions of our retail deposits, a widening of loan spreads, and expanded
spreads on a portion of our investment portfolio as the yield curve
steepened. The cost of liabilities over the quarter decreased 48 basis
points, which offset total earning asset declines of 38 basis points.
Fee-Based Revenues:
The Company's fee-based revenues for first quarter 2008 were $23.3 million,
up 4.6% as compared to first quarter 2007. In fourth quarter 2007 the
Company ceased originating traditional residential mortgages, which
produced fee income that was virtually offset by the cost of those mortgage
originations. If revenues from mortgage sales are excluded from the first
quarter 2007 total, the Company's fee-based revenues would be up 8.5%
centered in growth in service charges on deposits of 8.7% and growth in
annuity sales and trust advisory services of 7.9%.
Securities Gains, Net:
The Company recognized net securities gains in first quarter 2008 of $4.97
million. Included in this amount was a $1.35 million gain on the
redemption of a portion of the Company's ownership in VISA, Inc. as part of
VISA, Inc.'s IPO. This compared with gains in the same period of 2007 of
$3.4 million. Certain asset backed collateralized securities that were
subject to impairment charges in fourth quarter 2007 were further reduced
in carrying value by $2.3 million during the quarter.
Noninterest Expense:
Noninterest expense for first quarter 2008 was $49.3 million, up 2.5% from
first quarter 2007. The Company implemented targeted staff reductions in
fourth quarter 2007 and began realizing the benefit in first quarter 2008
resulting in salaries and benefits being down 4.9% from first quarter 2007.
The Company's efficiency ratio for first quarter was 54.02%.
Income Taxes:
The effective income tax rate for first quarter 2008 was 16.9%, as compared
to 23.5% for first quarter 2007. The decline from prior year is due
primarily to the recording of an additional State tax benefit of $1.5
million associated with the non-cash securities impairment charge
recognized in fourth quarter 2007.
Capital Management:
The Company's capital position continues to exceed all of the regulatory
minimum levels to be considered a "well capitalized institution" by the
Federal Reserve. As of March 31, 2008, the Company's Total Risk Based
Capital ratio was 11.78% and its Tier 1 Risk Based Capital ratio was 9.19%.
The Company's tangible capital ratio, which represents the ratio of
stockholders' equity to total assets excluding intangible assets, was
5.62%. The Company continues to maintain an investment grade rating of A3
from Moody's Investor Services and BBB+ from Standard and Poors and Fitch.
During first quarter 2008, the Company paid dividends of $0.310 per share,
up 5.1% from 2007's first quarter dividend and represents the 101st
consecutive quarterly dividend paid to our shareholders. At March 31,
2008, based on a closing stock price of $27.77, the annualized dividend
yield on common stock was 4.5%.
About the Company:
First Midwest is the premier relationship-based banking franchise in the
growing Chicagoland banking market. As one of the Chicago metropolitan
area's largest independent bank holding companies, First Midwest provides
the full range of both business and retail banking and trust and investment
management services through 102 offices located in 63 communities,
primarily in metropolitan Chicago. First Midwest was recently recognized
by the Alfred P. Sloan Awards for Business Excellence in Workforce
Flexibility in the greater Chicago Area.
Safe Harbor Statement
This press release contains "forward-looking statements" within the meaning
of the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. These statements are not historical facts but instead
represent only the Company's beliefs regarding future events, many of
which, by their nature, are inherently uncertain and outside of the
Company's control. It is possible that actual results and the Company's
financial condition may differ, possibly materially, from the anticipated
results and financial condition indicated in these forward-looking
statements. For a discussion of some of the risks and important factors
that could affect the Company's future results, see "Risk Factors" in the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
2007 and other reports filed with the Securities and Exchange Commission.
Forward-looking statements represent management's best judgment as of the
date hereof based on currently available information. Except as required
by law, the Company undertakes no duty to update the contents of this press
release after the date hereof.
Conference Call
A conference call to discuss the Company's results, outlook and related
matters will be held on Wednesday, April 23rd, at 10:00 am (ET). Members
of the public who would like to listen to the conference call should dial
1-866-800-8652 (U.S. domestic) or 1-617-614-2705 (international) and enter
passcode number 169 27 765. The number should be dialed at least 10
minutes prior to the start of the conference call. The conference call
will also be accessible as an audio webcast through the Investor Relations
section of the Company's web site,
www.firstmidwest.com/aboutinvestor_overview.asp. There is no charge to
access the call. For those unable to listen to the live broadcast, a
replay will be available on the Company's web site or by dialing
1-888-286-8010 (U.S. domestic) or 1-617-801-6888 (international) passcode
number 471 67 628, beginning approximately one hour after the event through
11:59 pm (ET) on April 30, 2008. Please direct any questions regarding
obtaining access to the conference call to First Midwest Bancorp, Inc.
Investor Relations, via e-mail, at
investor.relations@firstmidwest.com.
Accompanying Financial Statements and Tables
Accompanying this press release is the following unaudited financial
information:
-- Operating Highlights, Balance Sheet Highlights and Stock Performance
Data (1 page)
-- Condensed Consolidated Statements of Condition (1 page)
-- Condensed Consolidated Statements of Income (1 page)
-- Selected Quarterly Data and Asset Quality (1 page)
Press Release and Additional Information Available on Website
This press release, the accompanying financial statements and tables, and
certain additional unaudited Selected Financial Information
(
http://www.firstmidwest.com/aboutinvestor_selected.asp)(totaling 3 pages)
are available through the "Investor Relations" section of First Midwest's
website at
www.firstmidwest.com.
First Midwest Bancorp, Inc. Press Release Dated April 23, 2008
Operating Highlights Quarters Ended
Unaudited -----------------------------------------------
(Amounts in thousands, March 31, December 31, March 31,
except per share data) 2008 2007 2007
------------- ------------- -------------
Net income $ 25,038 $ (5,418) $ 29,029
Diluted earnings per
share $ 0.52 $ (0.11) $ 0.58
Return on average
equity 13.75% (2.91%) 15.48%
Return on average
assets 1.25% (0.27%) 1.42%
Net interest margin 3.53% 3.53% 3.53%
Efficiency ratio 54.02% 53.87% 52.19%
Balance Sheet Highlights
Unaudited Ending Balances As Of
(Amounts in thousands, -----------------------------------------------
except per share data) Mar. 31, 2008 Dec. 31, 2007 Mar. 31, 2007
------------- ------------- -------------
Total assets $ 8,315,368 $ 8,091,518 $ 8,235,110
Total loans 5,045,765 4,963,672 4,993,620
Total deposits 5,721,562 5,778,861 5,907,442
Stockholders' equity 737,927 723,975 753,988
Book value per share $ 15.20 $ 14.94 $ 15.16
Shares outstanding 48,561 48,453 49,747
Stock Performance Data Quarters Ended
-----------------------------------------------
Unaudited March 31, December 31, March 31,
2008 2007 2007
------------- ------------- -------------
Market Price:
Quarter End $ 27.77 $ 30.60 $ 36.75
High $ 31.98 $ 36.50 $ 39.31
Low $ 24.38 $ 29.67 $ 36.00
Quarter end price to
book value 1.8x 2.0x 2.4x
Quarter end price to
consensus estimated
2008 earnings $ 12.9x N/A N/A
Dividends declared
per share $ 0.310 $ 0.310 $ 0.295
First Midwest Bancorp, Inc. Press Release Dated April 23, 2008
Condensed Consolidated Statements of Condition
Unaudited March 31,
------------------------
(Amounts in thousands) 2008 2007
----------- -----------
Assets
Cash and due from banks $ 171,037 $ 156,585
Funds sold and other short-term investments 1,808 4,834
Trading account securities 17,305 16,708
Securities available for sale 2,100,602 2,241,608
Securities held to maturity, at amortized cost 95,651 103,697
Federal Home Loan Bank and Federal Reserve Bank
stock, at cost 54,767 54,767
Loans 5,045,765 4,993,620
Reserve for loan losses (64,780) (62,400)
----------- -----------
Net loans 4,980,985 4,931,220
----------- -----------
Premises, furniture, and equipment 123,257 126,483
Investment in corporate owned life insurance 203,987 197,421
Goodwill and other intangible assets 287,141 291,552
Accrued interest receivable and other assets 278,828 110,235
----------- -----------
Total assets $ 8,315,368 $ 8,235,110
----------- -----------
Liabilities and Stockholders' Equity
Deposits $ 5,721,562 $ 5,907,442
Borrowed funds 1,413,726 1,237,656
Subordinated debt 232,509 228,274
Accrued interest payable and other liabilities 209,644 107,750
----------- -----------
Total liabilities 7,577,441 7,481,122
----------- -----------
Common stock 613 613
Additional paid-in capital 206,011 205,311
Retained earnings 854,931 837,909
Accumulated other comprehensive (loss) (9,333) (16,338)
Treasury stock, at cost (314,295) (273,507)
----------- -----------
Total stockholders' equity 737,927 753,988
----------- -----------
Total liabilities and stockholders' equity $ 8,315,368 $ 8,235,110
----------- -----------
First Midwest Bancorp, Inc. Press Release Dated April 23, 2008
Condensed Consolidated Statements of Income Quarters Ended
Unaudited March 31,
-------------------------
(Amounts in thousands, except per share data) 2008 2007
----------- ------------
Interest Income
Loans $ 81,334 $ 92,079
Securities 27,120 29,300
Other 21 210
----------- ------------
Total interest income 108,475 121,589
----------- ------------
Interest Expense
Deposits 34,210 42,127
Borrowed funds 12,076 15,349
Subordinated debt 3,689 3,743
----------- ------------
Total interest expense 49,975 61,219
----------- ------------
Net interest income 58,500 60,370
Provision for loan losses 9,060 2,960
----------- ------------
Net interest income after provision for loan
losses 49,440 57,410
----------- ------------
Noninterest Income
Service charges on deposit accounts 10,422 9,587
Trust and investment management fees 3,947 3,790
Other service charges, commissions, and fees 5,002 5,159
Card-based fees 3,898 3,711
----------- ------------
Subtotal, fee-based revenues 23,269 22,247
----------- ------------
Corporate owned life insurance income 2,462 1,911
Securities gains, net 4,968 3,444
Other (680) 1,098
----------- ------------
Total noninterest income 30,019 28,700
----------- ------------
Noninterest Expense
Salaries and employee benefits 26,190 27,550
Net occupancy expense 6,151 5,502
Equipment expense 2,567 2,626
Technology and related costs 1,771 1,708
Other 12,664 10,769
----------- ------------
Total noninterest expense 49,343 48,155
----------- ------------
Income before taxes 30,116 37,955
Income tax expense 5,078 8,926
----------- ------------
Net Income $ 25,038 $ 29,029
----------- ------------
Diluted Earnings Per Share $ 0.52 $ 0.58
----------- ------------
Dividends Declared Per Share $ 0.310 $ 0.295
----------- ------------
Weighted Average Diluted Shares Outstanding 48,589 50,322
----------- ------------
First Midwest Bancorp, Inc. Press Release Dated April 23, 2008
Selected Quarterly Data
Unaudited Quarters Ended
------------------------------------------------
(Amounts in thousands,
except per share data) 3/31/08 12/31/07 9/30/07 6/30/07 3/31/07
-------- -------- -------- -------- --------
Net interest income $ 58,500 $ 58,098 $ 60,697 $ 60,964 $ 60,370
Provision for loan losses 9,060 2,042 470 1,761 2,960
Noninterest income 30,019 (22,465) 23,395 30,623 28,700
Noninterest expense 49,343 50,264 49,981 50,737 48,155
Net income 25,038 (5,418) 27,237 29,311 29,029
Diluted earnings per
share $ 0.52 $ (0.11) $ 0.55 $ 0.59 $ 0.58
Return on average equity 13.75% (2.91%) 14.57% 15.47% 15.48%
Return on average assets 1.25% (0.27%) 1.35% 1.44% 1.42%
Net interest margin 3.53% 3.53% 3.63% 3.61% 3.53%
Efficiency ratio 54.02% 53.87% 51.87% 52.13% 52.19%
-------- -------- -------- -------- --------
Period end shares
outstanding 48,561 48,453 48,735 49,494 49,747
Book value per share $ 15.20 $ 14.94 $ 14.94 $ 14.97 $ 15.16
Dividends declared per
share $ 0.310 $ 0.310 $ 0.295 $ 0.295 $ 0.295
-------- -------- -------- -------- --------
Asset Quality
Unaudited Quarters Ended
------------------------------------------------
(Amounts in thousands) 3/31/08 12/31/07 9/30/07 6/30/07 3/31/07
-------- -------- -------- -------- --------
Nonaccrual loans $ 17,073 $ 18,447 $ 12,771 $ 14,927 $ 17,582
Restructured loans 140 280 - - -
-------- -------- -------- -------- --------
Total nonperforming
loans 17,213 18,727 12,771 14,927 17,582
-------- -------- -------- -------- --------
Foreclosed real estate 8,607 6,053 4,032 3,683 3,195
Loans past due 90 days
and still accruing 33,479 21,149 21,421 19,633 15,603
-------- -------- -------- -------- --------
Nonperforming loans to
loans 0.34% 0.38% 0.26% 0.30% 0.35%
Nonperforming assets to
loans plus foreclosed
real estate 0.51% 0.50% 0.34% 0.38% 0.42%
Nonperforming assets plus
loans past due 90 days
to loans plus foreclosed
real estate 1.17% 0.92% 0.77% 0.78% 0.73%
Reserve for loan losses
to loans 1.28% 1.25% 1.25% 1.27% 1.25%
Reserve for loan losses
to nonperforming loans 376% 330% 481% 418% 355%
-------- -------- -------- -------- --------
Provision for loan losses $ 9,060 $ 2,042 $ 470 $ 1,761 $ 2,960
Net loan charge-offs 6,080 1,654 1,449 1,770 2,930
-------- -------- -------- -------- --------
Net loan charge-offs to
average loans 0.49% 0.13% 0.12% 0.14% 0.24%
-------- -------- -------- -------- --------
Contact Information: CONTACT:
Paul F. Clemens
EVP, Chief Financial Officer
(630) 875-7347
www.firstmidwest.com