NEWARK, Ohio, April 20, 2009 (GLOBE NEWSWIRE) -- Park National Corporation (Park) (NYSE Amex:PRK) today announced operating results for the three months ended March 31, 2009. Net income available to common shareholders was $20.0 million, compared to $23.0 million for the same period in 2008. First quarter 2009 net income per diluted common share was $1.43, a 13.3 percent decrease from the first quarter 2008 net income per diluted common share of $1.65.
Net income figures for the first quarter of 2008 included a one-time benefit (reported in the "other income" category) of $3.1 million related to the Visa IPO. Net of taxes, this contributed $2.0 million to net income, or $0.14 to net income per diluted share for the first quarter of 2008.
Park's board of directors also declared a second quarter cash dividend of $0.94 per common share, payable on June 10, 2009 to common shareholders of record as of May 27, 2009.
"We are pleased with our first quarter performance. On March 11, 2009, we projected that net income available to common shareholders would be approximately $18 million for the first quarter and the actual results were $2 million higher," said Park Chairman, C. Daniel DeLawder.
The better-than-expected earnings for Park were largely due to a high volume of fixed rate residential mortgage loans. During the first quarter 2009, Park originated $181.6 million in fixed rate residential mortgage loans, compared to $55.6 million for the first quarter 2008. These loans are sold in the secondary market and Park maintains the servicing on these loans. The pre-tax real estate non-yield loan fee income was $5.0 million for the first quarter 2009, compared to $2.1 million for the first quarter 2008.
The U.S. government and the Federal Reserve System have continued their dedicated effort to facilitate extraordinarily low fixed interest rates for residential mortgage loans, and Park's loan volume has benefited from offering especially low rates on new and refinanced loans since the end of 2008.
According to DeLawder, the increase in home loan refinances is only partly generated by an excellent low interest rate environment. "People like the reliability of local service for their home loan. They want to speak directly with a knowledgeable, responsive lender who can deliver more than great low rates. That's been our lending style for decades and we're eager to help more people take advantage of the opportunity to save money and gain peace of mind," he said.
Park also experienced an increase in commercial and consumer loans during the first quarter. At March 31, 2009, Park had $4,562 million in total loans on its consolidated balance sheet, compared to $4,491 million at year-end 2008 and $4,253 million at March 31, 2008. Total loans increased overall by $70.2 million during the first quarter 2009, representing 6.3 percent annualized growth.
Deposit balances also increased during the first quarter 2009. At March 31, 2009, Park had total deposits of $4,920 million, compared to $4,762 million at year-end 2008 and $4,520 million at March 31, 2008.
Park's first quarter 2009 net loan charge-offs totaled $11.1 million, or an annualized 0.99 percent of loans outstanding. In the same period in 2008, net loan charge-offs were $8.6 million, or an annualized 0.82 percent of loans outstanding. The loan loss provision was $12.3 million in the first quarter 2009, compared to $7.4 million in the first quarter 2008. Park subsidiary Vision Bank (headquartered in Panama City, Fla.) had a loan loss provision of $8.5 million for the first quarter 2009, compared to $4.8 million for that period in 2008. Park's Ohio-based banking divisions had a total loan loss provision of $3.8 million for the first quarter 2009, compared to $2.6 million for the same period in 2008.
First quarter of 2009 net income for Park's Ohio-based banking divisions was $25.4 million. "We continue to be very pleased with the earnings from Park's Ohio-based banking divisions. Last year was a record earnings year for that group with a net income of $94.9 million for year-end 2008," DeLawder said.
Headquartered in Newark, Ohio, Park National Corporation holds $7.1 billion in total assets (as of March 31, 2009). Park consists of 14 community bank divisions and two specialty finance companies. Park's Ohio-based banking operations are conducted through Park subsidiary The Park National Bank and its divisions which include Fairfield National Bank, Richland Bank, Century National Bank, First-Knox National Bank, Farmers and Savings Bank, United Bank, Second National Bank, Security National Bank, Unity National Bank, Citizens National Bank and The Park National Bank of Southwest Ohio & Northern Kentucky. Park's other banking subsidiary is Vision Bank (headquartered in Panama City, Florida), and its Vision Bank Division (of Gulf Shores, Alabama). Park also includes Scope Leasing, Inc. (d.b.a. Scope Aircraft Finance) and Guardian Finance Company.
Complete financial tables are included below.
SAFE HARBOR STATEMENT under the private securities litigation reform act of 1995
This news release contains forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management's expectations and are subject to a number of risks and uncertainties. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include, without limitation: deterioration in the asset value of Park's loan portfolio may be worse than expected; Park's ability to execute its business plan successfully and within the expected timeframe; general economic and financial market conditions, and weakening in the economy, specifically, the real estate market and credit market, either national or in the states in which Park and its subsidiaries do business, are worse than expected; changes in the interest rate environment reduce net interest margins; competitive pressures among financial institutions increase significantly; the nature, timing and effect of changes in banking regulations or other regulatory or legislative requirements affecting the respective businesses of Park and its subsidiaries; demand for loans in the respective market areas served by Park and its subsidiaries, and other risk factors relating to the banking industry as detailed from time to time in Park's reports filed with the Securities and Exchange Commission including those described in "Item 1A. Risk Factors" of Part I of Park's Annual Report on Form 10-K for the fiscal year ended December 31, 2008. Undue reliance should not be placed on the forward-looking statements, which speak only as of the date hereof. Park does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.
PARK NATIONAL CORPORATION FINANCIAL HIGHLIGHTS (Dollars in thousands, except per share data) INCOME STATEMENT AND RATIOS THREE MONTHS ENDED MARCH 31, --------------------------------------- PERCENT 2009 2008 CHANGE ---------- ---------- ----------- NET INTEREST INCOME $ 68,233 $ 61,484 10.98% PROVISION FOR LOAN LOSSES 12,287 7,394 66.18% OTHER INCOME 19,210 21,039 -8.69% GAIN ON SALE OF SECURITIES -- 309 OTHER EXPENSE 45,862 43,277 5.97% INCOME BEFORE TAXES 29,294 32,161 -8.91% NET INCOME 21,390 22,978 -6.91% NET INCOME AVAILABLE TO COMMON SHAREHOLDERS (x) 19,950 22,978 -13.18% NET INCOME PER COMMON SHARE-BASIC (x) 1.43 1.65 -13.33% NET INCOME PER COMMON SHARE-DILUTED (x) 1.43 1.65 -13.33% RETURN ON AVERAGE ASSETS (x) 1.15% 1.42% RETURN ON AVERAGE COMMON EQUITY (x) 14.66% 16.02% CASH DIVIDENDS DECLARED PER SHARE 0.94 0.94 0.00% INCOME STATEMENT AND RATIOS (NON GAAP) RETURN ON AVERAGE TANGIBLE ASSETS (c)(x) 1.16% 1.46% RETURN ON AVERAGE TANGIBLE REALIZED COMMON EQUITY (a)(x) 17.67% 21.72% OTHER RATIOS YIELD ON EARNING ASSETS 5.81% 6.83% COST OF PAYING LIABILITIES 1.84% 3.07% NET INTEREST MARGIN 4.26% 4.19% NET LOAN CHARGE-OFFS $ 11,097 $ 8,648 NET CHARGE-OFFS AS A PERCENT OF LOANS 0.99% 0.82%
BALANCE SHEET March 31, Dec. 31, March 31, 2009 2008 2008 ---------- ---------- ----------- INVESTMENTS $2,035,622 $2,059,051 $1,956,035 LOANS 4,561,508 4,491,337 4,253,363 LOAN LOSS RESERVE 101,279 100,088 85,848 GOODWILL AND OTHER INTANGIBLES 84,608 85,545 143,550 TOTAL ASSETS 7,059,175 7,070,720 6,781,365 TOTAL DEPOSITS 4,920,213 4,761,750 4,519,756 BORROWINGS 1,378,686 1,554,754 1,581,465 EQUITY 656,218 642,663 591,179 COMMON EQUITY 560,306 546,942 591,179 TANGIBLE COMMON EQUITY (b) 475,698 461,397 447,629 COMMON BOOK VALUE PER SHARE 40.10 39.15 42.33 TANGIBLE COMMON BOOK VALUE PER SHARE (b) 34.05 33.02 32.05 NONPERFORMING LOANS 156,957 162,357 107,303 NONPERFORMING ASSETS 191,130 188,205 127,416 PAST DUE 90 DAY LOANS 7,807 5,421 4,032 RATIOS LOANS/ASSETS 64.62% 63.52% 62.72% NONPERFORMING LOANS/LOANS 3.44% 3.61% 2.52% PAST DUE 90 DAY LOANS/LOANS 0.17% 0.12% 0.09% LOAN LOSS RESERVE/LOANS 2.22% 2.23% 2.02% TOTAL EQUITY/ASSETS 9.30% 9.09% 8.72% COMMON EQUITY/ASSETS 7.94% 7.74% 8.72% TANGIBLE COMMON EQUITY/ TANGIBLE ASSETS (d) 6.82% 6.61% 6.74%
(x) Reported measure excludes the impact of the preferred stock issued to the U.S. Treasury under the Capital Purchase Program and uses net income available to common shareholders. (a) Net Income available to common shareholders for each period divided by average tangible realized common equity during the period. Average tangible realized equity equals average stockholders' equity during the applicable period less (i) average goodwill and other intangibles during the period, (ii) average accumulated other comprehensive income, net of taxes, during the period, and (iii) Preferred stock.
RECONCILIATION OF AVERAGE STOCKHOLDERS' EQUITY TO AVERAGE TANGIBLE REALIZED COMMON EQUITY: THREE MONTHS ENDED MARCH 31, ------------------- 2009 2008 -------- -------- AVERAGE STOCKHOLDERS' EQUITY 647,853 576,879 Less: Preferred stock 95,802 -- Average goodwill and other intangibles 85,142 144,119 Average accumulated other comprehensive income, net of taxes 8,997 7,306 AVERAGE TANGIBLE REALIZED COMMON EQUITY 457,912 425,454 ======== ========
(b) Tangible common book value per share equals ending stockholders' equity less preferred stock and goodwill and other intangibles at the end of the period, divided by actual common shares outstanding at the end of the period.
RECONCILIATION OF STOCKHOLDERS' EQUITY TO TANGIBLE COMMON EQUITY: March 31, Dec. 31, March 31, 2009 2008 2008 ---------- ---------- ----------- STOCKHOLDERS' EQUITY 656,218 642,663 591,179 Less: Preferred stock 95,912 95,721 -- Goodwill and other intangibles 84,608 85,545 143,550 TANGIBLE COMMON EQUITY 475,698 461,397 447,629 ========== ========== ===========
(c) Net income available to common shareholders divided by average tangible assets. Average tangible assets equals average assets less goodwill and other intangibles.
RECONCILIATION OF AVERAGE ASSETS TO AVERAGE TANGIBLE ASSETS THREE MONTHS ENDED MARCH 31, ----------------------- 2009 2008 --------- --------- AVERAGE ASSETS 7,059,725 6,492,513 Less average goodwill and other intangibles 85,142 144,119 AVERAGE TANGIBLE ASSETS 6,974,583 6,348,394
(d) Tangible common equity divided by tangible assets. Tangible assets equals total assets less goodwill and other intangibles.
RECONCILIATION OF TOTAL ASSETS TO TANGIBLE ASSETS: March 31, Dec. 31, March 31, 2009 2008 2008 ---------- ---------- ----------- TOTAL ASSETS 7,059,175 7,070,720 6,781,365 Less: Goodwill and other intangibles 84,608 85,545 143,550 TANGIBLE ASSETS 6,974,567 6,985,175 6,637,815 ========== ========== ===========
PARK NATIONAL CORPORATION Consolidated Statements of Income (dollars in thousands, except per share data) Three Months Ended March 31, ------------------------- 2009 2008 ----------- ----------- Interest income: Interest and fees on loans $ 69,088 $ 79,010 Interest on: Obligations of U.S. Government, its agencies and other securities 23,828 20,705 Obligations of states and political subdivisions 422 654 Other interest income 27 99 Total interest income 93,365 100,468 Interest expense: Interest on deposits: Demand and savings deposits 2,905 7,358 Time deposits 14,374 19,199 Interest on borrowings 7,853 12,427 Total interest expense 25,132 38,984 Net interest income 68,233 61,484 Provision for loan losses 12,287 7,394 Net interest income after provision for loan losses 55,946 54,090 Other income 19,210 21,039 Gain on sale of securities -- 309 Other expense: Salaries and employee benefits 25,487 24,671 Occupancy expense 3,158 3,025 Furniture and equipment expense 2,378 2,317 Other expense 14,839 13,264 Total other expense 45,862 43,277 Income before income taxes 29,294 32,161 Income taxes 7,904 9,183 Net income $ 21,390 $ 22,978 Preferred stock dividends 1,440 -- Income available to common shareholders $ 19,950 $ 22,978 Per Common Share: Net income - basic $1.43 $1.65 Net income - diluted $1.43 $1.65 Weighted average shares - basic 13,971,720 13,964,572 Weighted average shares - diluted 13,971,720 13,964,572
PARK NATIONAL CORPORATION Consolidated Balance Sheets (dollars in thousands, except share data) March 31, -------------------------- 2009 2008 ----------- ----------- Assets Cash and due from banks $ 108,523 $ 176,350 Money market instruments 17,844 8,547 Investment securities 2,035,622 1,956,035 Loans 4,561,508 4,253,363 Allowance for loan losses 101,279 85,848 Loans, net 4,460,229 4,167,515 Bank premises and equipment, net 68,177 68,816 Goodwill and other intangibles 84,608 143,550 Other assets 284,172 260,552 Total assets $ 7,059,175 $ 6,781,365 Liabilities and Stockholders' Equity Deposits: Noninterest bearing $ 746,594 $ 711,151 Interest bearing 4,173,619 3,808,605 Total deposits 4,920,213 4,519,756 Borrowings 1,378,686 1,581,465 Other liabilities 104,058 88,965 Total liabilities 6,402,957 6,190,186 Stockholders' Equity: Preferred Stock (200,000 shares authorized in 2009 and -0- in 2008; 100,000 shares issued in 2009 and -0- in 2008) 95,912 -- Common stock (No par value; 20,000,000 shares authorized in 2009 and 2008; 16,151,137 shares issued in 2009 and 16,151,188 in 2008) 301,210 301,213 Common stock warrants 4,297 -- Accumulated other comprehensive income, net of taxes 17,144 10,627 Retained earnings 445,320 487,443 Treasury stock (2,179,424 shares in 2009 and 2,186,624 shares in 2008) (207,665) (208,104) Total stockholders' equity 656,218 591,179 Total liabilities and stockholders' equity $ 7,059,175 $ 6,781,365
PARK NATIONAL CORPORATION Consolidated Average Balance Sheets (dollars in thousands) Three Months Ended March 31, -------------------------- 2009 2008 ----------- ----------- Assets Cash and due from banks $ 128,206 $ 141,568 Money market instruments 23,746 11,501 Investment securities 2,019,651 1,717,375 Loans 4,549,313 4,229,423 Allowance for loan losses 100,453 87,273 Loans, net 4,448,860 4,142,150 Bank premises and equipment, net 68,351 69,018 Goodwill and other intangibles 85,142 144,119 Other assets 285,769 266,782 Total assets $ 7,059,725 $ 6,492,513 Liabilities and Stockholders' Equity Deposits: Noninterest bearing $ 773,512 $ 705,014 Interest bearing 4,055,678 3,768,060 Total deposits 4,829,190 4,473,074 Borrowings 1,470,677 1,343,208 Other liabilities 112,005 99,352 Total liabilities 6,411,872 5,915,634 Stockholders' Equity: Preferred stock 95,802 -- Common stock 301,210 301,213 Common stock warrants 4,297 -- Accumulated other comprehensive income, net of taxes 8,997 7,306 Retained earnings 445,212 476,464 Treasury stock (207,665) (208,104) Total stockholders' equity 647,853 576,879 Total liabilities and stockholders' equity $ 7,059,725 $ 6,492,513