MONROE, Mich., July 17, 2008 (PRIME NEWSWIRE) -- MBT Financial Corp., (Nasdaq:MBTF), the parent company of Monroe Bank & Trust, reported second quarter 2008 net income of $1.7 million, or $0.11 per diluted share, compared to the $3.5 million, or $0.21 per diluted share earned in the second quarter of 2007. Net income for the six months ended June 30, 2008 was $4.4 million, or $0.27 per diluted share, compared to $7.2 million, or $0.43 per diluted share in the first half of 2007.
H. Douglas Chaffin, President and CEO, commented, "The ongoing challenges in the southeast Michigan economy, with increasing unemployment and decreasing real estate values, continue to have a negative impact on our performance. We monitor the quality of our loan portfolios closely, and we decided to increase the allowance for loan losses and write down the values of some of our Other Real Estate Owned this quarter. Our Allowance for Loan Losses is now $18.1 million, or 1.83% of loans. Non performing assets (NPAs) increased from $55.4 million to $62.3 million. Our strong capital position allowed us to pay quarterly dividends that exceeded our earnings for the last three quarters and now represents an annualized yield in excess of 14% on our current stock price. We are concerned about our current level of dividends relative to earnings. In accordance with its customary practice our board of directors will closely evaluate our capital needs, earnings expectations, and market conditions before declaring our next dividend. The next dividend announcement is not anticipated until after the board's August meeting on August 28, 2008."
Mr. Chaffin further commented on the Company's earnings for the quarter: "Net Interest Income increased $340,000 compared to the second quarter of 2007 due to the improvement in the net interest margin and the slight growth in average earning assets. We are encouraged by the second consecutive quarterly improvement in the margin, and we are beginning to see the benefits of our cost reduction initiatives. Non interest income, excluding securities transactions, decreased 4.8% compared to last year as Wealth Management fees were impacted by lower market values for investments and origination fees on mortgage loans sold were impacted by a decline in real estate lending activity. Credit quality issues also affected our non interest expenses, which increased 9.5% compared to last year. We expect credit related expenses to remain high, but we will see meaningful expense improvement in most other areas."
Conference Call
MBT Financial Corp. will hold a conference call to discuss first quarter results on Friday, July 18, at 10:00 a.m. Eastern Time. The call will be webcast and can be accessed at the Investor Relations/Corporate Profile page of MBT Financial Corp.'s web site www.mbandt.com. The call can also be accessed by calling (800) 860-2442. The event will be archived on the Company's web site and available for three months following the call.
About the Company
MBT Financial Corp. (Nasdaq:MBTF), a single bank holding company headquartered in Monroe, Michigan, is the parent company of Monroe Bank & Trust (MBT).
Founded in 1858, MBT is one of the largest full service community banks in Southeast Michigan, with more than $1.5 billion in assets, offering personal and business products and services, and complete credit options. MBT's Wealth Management Group is one of the area's largest trust departments with over $800 Million in assets under management. With 25 offices, 41 ATMs, PhoneLink telephone banking and eLink online banking, MBT prides itself on an incomparable level of service and access for its customers. Visit MBT's web site at www.MBandT.com.
The MBT Financial Corp. logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=4214
Forward-Looking Statements
Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of Section 21A of the Securities Exchange Act of 1934. Forward-looking statements which are based on various assumptions (some of which are beyond the Company's control), may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of these terms. Actual results could differ materially from those set forth in forward-looking statements, due to a variety of factors, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset/liability management, change in the financial and securities markets, including changes with respect to the market value of our financial assets, the availability of and costs associated with sources of liquidity, and the ability of the Company to resolve or dispose of problem loans. The Company undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.
MBT FINANCIAL CORP. CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED Quarterly ------------------------ (dollars in thousands except per share 2008 2008 data) 2nd Qtr 1st Qtr ----------- ----------- EARNINGS Net interest income $ 11,127 $ 10,453 FTE Net interest income $ 11,463 $ 10,784 Provision for loan and lease losses $ 2,700 $ 1,200 Non-interest income $ 3,858 $ 3,962 Non-interest expense $ 10,163 $ 9,698 Net income (loss) $ 1,718 $ 2,647 Basic earnings (loss) per share $ 0.11 $ 0.16 Diluted earnings (loss) per share $ 0.11 $ 0.16 Average shares outstanding 16,130,806 16,127,047 Average diluted shares outstanding 16,144,981 16,139,073 PERFORMANCE RATIOS Return on average assets 0.45% 0.69% Return on average common equity 5.34% 8.24% Base Margin 3.05% 2.84% FTE Adjustment 0.09% 0.09% Loan Fees 0.07% 0.07% ----------- ----------- FTE Net Interest Margin 3.21% 3.00% Efficiency ratio 61.24% 64.51% Full-time equivalent employees 384 380 CAPITAL Average equity to average assets 8.42% 8.36% Book value per share $ 7.52 $ 7.94 Cash dividend per share $ 0.18 $ 0.18 ASSET QUALITY Loan Charge-Offs $ 2,607 $ 3,955 Loan Recoveries $ 317 $ 216 ----------- ----------- Net Charge-Offs $ 2,290 $ 3,739 Allowance for loan and lease losses $ 18,093 $ 17,683 Nonaccrual Loans $ 38,115 $ 37,814 Loans 90 days past due $ 109 $ 94 Restructured loans $ 6,023 $ 1,679 ----------- ----------- Total non performing loans $ 44,247 $ 39,587 Other real estate owned & other assets $ 18,065 $ 15,819 ----------- ----------- Total non performing assets $ 62,312 $ 55,406 Problem Loans Still Performing $ 41,188 $ 40,521 ----------- ----------- Total Problem Assets $ 103,500 $ 95,927 Net loan charge-offs to average loans 0.93% 1.51% Allowance for losses to total loans 1.83% 1.78% Non performing loans to gross loans 4.47% 3.99% Non performing assets to total assets 4.04% 3.56% Allowance to non performing loans 40.89% 44.67% END OF PERIOD BALANCES Loans and leases $ 989,839 $ 991,402 Total earning assets $ 1,421,653 $ 1,435,370 Total assets $ 1,542,747 $ 1,555,450 Deposits $ 1,065,770 $ 1,095,605 Interest Bearing Liabilities $ 1,267,718 $ 1,286,289 Shareholders' equity $ 121,348 $ 128,081 Total Shares Outstanding 16,132,513 16,128,321 AVERAGE BALANCES Loans and leases $ 992,618 $ 998,060 Total earning assets $ 1,432,923 $ 1,444,037 Total assets $ 1,536,884 $ 1,545,048 Deposits $ 1,076,046 $ 1,109,664 Interest Bearing Liabilities $ 1,273,052 $ 1,283,990 Shareholders' equity $ 129,353 $ 129,175 Quarterly ------------------------------------- (dollars in thousands except 2007 2007 2007 per share data) 4th Qtr 3rd Qtr 2nd Qtr ----------- ----------- ----------- EARNINGS Net interest income $ 10,131 $ 10,668 $ 10,787 FTE Net interest income $ 10,232 $ 11,011 $ 11,127 Provision for loan and lease losses $ 8,907 $ 1,000 $ 750 Non-interest income $ 3,824 $ 3,928 $ 4,119 Non-interest expense $ 9,601 $ 9,242 $ 9,279 Net income (loss) $ (2,706) $ 3,181 $ 3,535 Basic earnings (loss) per share $ (0.17) $ 0.20 $ 0.21 Diluted earnings (loss) per share $ (0.17) $ 0.20 $ 0.21 Average shares outstanding 16,135,339 16,288,696 16,558,137 Average diluted shares outstanding 16,145,958 16,310,279 16,585,720 PERFORMANCE RATIOS Return on average assets -0.70% 0.83% 0.94% Return on average common equity -8.05% 9.55% 10.33% Base Margin 2.74% 2.90% 2.98% FTE Adjustment 0.03% 0.10% 0.10% Loan Fees 0.06% 0.08% 0.07% ----------- ----------- ----------- FTE Net Interest Margin 2.83% 3.08% 3.15% Efficiency ratio 60.16% 61.06% 60.74% Full-time equivalent employees 404 426 425 CAPITAL Average equity to average assets 8.66% 8.69% 9.06% Book value per share $ 7.90 $ 8.15 $ 8.00 Cash dividend per share $ 0.18 $ 0.18 $ 0.18 ASSET QUALITY Loan Charge-Offs $ 3,204 $ 1,013 $ 1,082 Loan Recoveries $ 195 $ 256 $ 343 ----------- ----------- ----------- Net Charge-Offs $ 3,009 $ 757 $ 739 Allowance for loan and lease losses $ 20,222 $ 14,323 $ 14,080 Nonaccrual Loans $ 30,459 $ 26,440 $ 20,017 Loans 90 days past due $ 102 $ 105 $ 105 Restructured loans $ 3,367 $ 938 $ 1,371 ----------- ----------- ----------- Total non performing loans $ 33,928 $ 27,483 $ 21,493 Other real estate owned & other assets $ 12,565 $ 6,389 $ 3,064 ----------- ----------- ----------- Total non performing assets $ 46,493 $ 33,872 $ 24,557 Problem Loans Still Performing $ 41,022 $ 32,822 $ 34,859 ----------- ----------- ----------- Total Problem Assets $ 87,515 $ 66,694 $ 59,416 Net loan charge-offs to average loans 1.19% 0.30% 0.30% Allowance for losses to total loans 2.02% 1.42% 1.40% Non performing loans to gross loans 3.39% 2.72% 2.14% Non performing assets to total assets 2.99% 2.17% 1.62% Allowance to non performing loans 59.60% 52.12% 65.51% END OF PERIOD BALANCES Loans and leases $ 1,002,259 $ 1,008,875 $ 1,002,248 Total earning assets $ 1,440,317 $ 1,439,366 $ 1,402,808 Total assets $ 1,556,806 $ 1,560,234 $ 1,516,026 Deposits $ 1,109,980 $ 1,110,074 $ 1,078,431 Interest Bearing Liabilities $ 1,273,665 $ 1,273,695 $ 1,224,061 Shareholders' equity $ 127,447 $ 131,651 $ 131,056 Total Shares Outstanding 16,124,997 16,148,863 16,379,602 AVERAGE BALANCES Loans and leases $ 1,002,948 $ 1,010,604 $ 994,093 Total earning assets $ 1,436,545 $ 1,419,329 $ 1,420,183 Total assets $ 1,539,446 $ 1,520,222 $ 1,516,209 Deposits $ 1,094,346 $ 1,086,050 $ 1,075,960 Interest Bearing Liabilities $ 1,264,772 $ 1,248,691 $ 1,236,703 Shareholders' equity $ 133,363 $ 132,088 $ 137,322 Year to Date (dollars in thousands except per -------------------------- share data) 2008 2007 ----------- ----------- EARNINGS Net interest income $ 21,580 $ 21,970 FTE Net interest income $ 22,247 $ 22,714 Provision for loan and lease losses $ 3,900 $ 1,500 Non-interest income $ 7,820 $ 7,882 Non-interest expense $ 19,861 $ 18,391 Net income (loss) $ 4,365 $ 7,238 Basic earnings (loss) per share $ 0.27 $ 0.43 Diluted earnings (loss) per share $ 0.27 $ 0.43 Average shares outstanding 16,125,926 16,622,204 Average diluted shares outstanding 16,140,101 16,651,173 PERFORMANCE RATIOS Return on average assets 0.57% 0.95% Return on average common equity 6.79% 10.62% Base Margin 2.95% 3.02% FTE Adjustment 0.09% 0.10% Loan Fees 0.07% 0.07% ----------- ----------- FTE Net Interest Margin 3.11% 3.19% Efficiency ratio 62.83% 59.79% Full-time equivalent employees 382 427 CAPITAL Average equity to average assets 8.39% 8.98% Book value per share $ 7.52 $ 8.00 Cash dividend per share $ 0.36 $ 0.36 ASSET QUALITY Loan Charge-Offs $ 6,562 $ 2,170 Loan Recoveries $ 533 $ 986 ----------- ----------- Net Charge-Offs $ 6,029 $ 1,184 Allowance for loan and lease losses $ 18,093 $ 14,080 Nonaccrual Loans $ 38,115 $ 20,017 Loans 90 days past due $ 109 $ 105 Restructured loans $ 6,023 $ 1,371 ----------- ----------- Total non performing loans $ 44,247 $ 21,493 Other real estate owned & other assets $ 18,065 $ 3,064 ----------- ----------- Total non performing assets $ 62,312 $ 24,557 Problem Loans Still Performing $ 41,188 $ 34,859 ----------- ----------- Total Problem Assets $ 103,500 $ 59,416 Net loan charge-offs to average loans 1.22% 0.24% Allowance for losses to total loans 1.83% 1.40% Non performing loans to gross loans 4.47% 2.14% Non performing assets to total assets 4.04% 1.62% Allowance to non performing loans 40.89% 65.51% END OF PERIOD BALANCES Loans and leases $ 989,839 $ 1,002,248 Total earning assets $ 1,421,653 $ 1,402,808 Total assets $ 1,542,747 $ 1,516,026 Deposits $ 1,065,770 $ 1,078,431 Interest Bearing Liabilities $ 1,267,718 $ 1,224,061 Shareholders' equity $ 121,348 $ 131,056 Total Shares Outstanding 16,132,513 16,379,602 AVERAGE BALANCES Loans and leases $ 995,339 $ 993,797 Total earning assets $ 1,438,445 $ 1,433,143 Total assets $ 1,540,966 $ 1,530,284 Deposits $ 1,092,855 $ 1,087,839 Interest Bearing Liabilities $ 1,278,521 $ 1,249,949 Shareholders' equity $ 129,264 $ 137,447 MBT FINANCIAL CORP. CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED ------------------------------------------------------------------ Quarter Ended June 30, Dollars in thousands (except per share data) 2008 2007 Interest Income Interest and fees on loans $ 15,771 $ 17,751 Interest on investment securities- Tax-exempt 818 871 Taxable 4,798 4,582 Interest on federal funds sold -- 84 Total interest income 21,387 23,288 Interest Expense Interest on deposits 6,368 7,981 Interest on borrowed funds 3,892 4,520 Total interest expense 10,260 12,501 Net Interest Income 11,127 10,787 Provision For Loan Losses 2,700 750 Net Interest Income After Provision For Loan Losses 8,427 10,037 Other Income Income from wealth management services 1,119 1,151 Service charges and other fees 1,586 1,574 Net gain (loss) on sales of securities 23 92 Origination fees on mortgage loans sold 91 210 Bank Owned Life Insurance income 275 334 Other 764 758 Total other income 3,858 4,119 Other Expenses Salaries and employee benefits 5,441 5,599 Occupancy expense 916 844 Equipment expense 848 850 Marketing expense 356 369 Professional fees 455 406 Net (gain) loss on other real estate owned 354 (8) Other 1,793 1,219 Total other expenses 10,163 9,279 Income Before Income Taxes 2,122 4,877 Income Tax Expense 404 1,342 Net Income $ 1,718 $ 3,535 ------------------------------------------------------------------ Basic Earnings Per Common Share $ 0.11 $ 0.21 ------------------------------------------------------------------ Diluted Earnings Per Common Share $ 0.11 $ 0.21 ------------------------------------------------------------------ Dividends Declared Per Common Share $ 0.18 $ 0.18 ------------------------------------------------------------------ MBT FINANCIAL CORP. CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED ---------------------------------------------------------------- Six Months Ended June 30, Dollars in thousands (except per share 2008 2007 data) Interest Income Interest and fees on loans $32,199 $35,512 Interest on investment securities- Tax-exempt 1,633 1,880 Taxable 9,754 9,497 Interest on federal funds sold 1 116 Total interest income 43,587 47,005 Interest Expense Interest on deposits 13,859 15,936 Interest on borrowed funds 8,148 9,099 Total interest expense 22,007 25,035 Net Interest Income 21,580 21,970 Provision For Loan Losses 3,900 1,500 Net Interest Income After Provision For Loan Losses 17,680 20,470 Other Income Income from trust services 2,246 2,218 Service charges and other fees 3,112 3,099 Net gain (loss) on sales of securities 48 92 Origination fees on mortgage loans sold 284 393 Bank Owned Life Insurance income 630 630 Other 1,500 1,450 Total other income 7,820 7,882 Other Expenses Salaries and employee benefits 11,023 11,048 Occupancy expense 1,911 1,724 Equipment expense 1,676 1,695 Marketing expense 597 621 Professional fees 924 776 Net loss on other real estate owned 389 10 Other 3,341 2,517 Total other expenses 19,861 18,391 Income Before Income Taxes 5,639 9,961 Income Tax Expense (Benefit) 1,274 2,723 Net Income $ 4,365 $ 7,238 ---------------------------------------------------------------- Basic Earnings Per Common Share $ 0.27 $ 0.43 ---------------------------------------------------------------- Diluted Earnings Per Common Share $ 0.27 $ 0.43 ---------------------------------------------------------------- Dividends Declared Per Common Share $ 0.36 $ 0.36 ---------------------------------------------------------------- MBT FINANCIAL CORP. CONSOLIDATED BALANCE SHEETS June 30, 2008 December 31, Dollars in thousands (Unaudited) 2007 Assets Cash and Cash Equivalents Cash and due from banks $ 21,986 $ 25,113 Total cash and cash equivalents 21,986 25,113 Securities - Held to Maturity 38,005 44,734 Securities - Available for Sale 380,723 380,238 Federal Home Loan Bank stock - at cost 13,086 13,086 Loans held for sale 408 1,431 Loans - Net 971,338 980,606 Accrued interest receivable and other assets 41,830 36,370 Bank Owned Life Insurance 43,139 42,509 Premises and Equipment - Net 32,232 32,719 Total assets $ 1,542,747 $ 1,556,806 ------------------------------------------------------------------- Liabilities Deposits: Non-interest bearing $ 139,052 $ 141,115 Interest-bearing 926,718 968,865 Total deposits 1,065,770 1,109,980 Federal Home Loan Bank advances 256,500 256,500 Federal funds purchased 54,500 13,300 Repurchase agreements 30,000 35,000 Interest payable and other liabilities 14,629 14,579 Total liabilities 1,421,399 1,429,359 Shareholders' Equity Common stock (no par value) -- -- Retained Earnings 128,674 129,917 Accumulated other comprehensive income (7,326) (2,470) Total shareholders' equity 121,348 127,447 Total liabilities and shareholders' equity $ 1,542,747 $ 1,556,806 -------------------------------------------------------------------