DEFIANCE, Ohio, Jan. 21, 2009 (GLOBE NEWSWIRE) -- Rurban Financial Corp. (Nasdaq:RBNF), a leading provider of full-service community banking, investment management, trust services and bank data and item processing, reported 2008 earnings of $5.22 million, or $1.06 per diluted share, an increase of approximately 60.2 percent from the $3.26 million, or $0.65 per diluted share, reported in 2007. The 2008 results include thirty-one days of operation of the five banking centers acquired in the National Bank of Montpelier ("Montpelier") acquisition and the associated acquisition charges.
Fourth quarter 2008 earnings were $1.33 million, or $0.27 per diluted share, compared with fourth quarter 2007 earnings of $906,000, or $0.18 per diluted share, an increase of approximately 46.7 percent.
Earnings for the 2008 fourth quarter included one-time after-tax charges of $76,000 related to the Corporation's acquisition of Montpelier. The Corporation also recorded an after-tax charge of $66,000, reducing the mortgage servicing rights value on the Corporation's $71.1 million serviced mortgage loan portfolio, as a result of the recent drop in mortgage rates.
Highlights of fourth quarter 2008 include:
* The State Bank and Trust Company ("State Bank"), Rurban's banking
subsidiary, completed the acquisition of Montpelier, with five
branches located in Williams County, on December 1, 2008. The
acquisition was valued at $25.0 million. This acquisition increases
State Bank's banking center locations from 17 to 22. The
acquisition is expected to be immediately accretive to earnings.
* The turmoil in the banking industry during the majority of the year,
and especially the fourth quarter, had many institutions electing
to participate in the Government's TARP/CPP program. After thorough
consideration of the program's advantages and disadvantages, Rurban
Financial Corp. and its Board elected not to participate in the
program due to Rurban's strong capital position and the TARP
program's uncertainties relative to the Government's intervention
and expectation relative to the funds' usage.
* State Bank expanded its reach into Columbus, Ohio's high volume
mortgage market by adding a Mortgage Origination Group to the
Columbus Loan Production Office.
* Asset quality essentially remained stable, with non-performing
assets declining slightly to 1.00 percent of total assets. Net
charge-offs remained moderate and significantly below peers at 0.19
percent of total loans for 2008.
"We have made substantial progress in all business units within Rurban during 2008," commented Ken Joyce, Rurban's CEO. Joyce continued, "The leading drivers of profitability gains at State Bank were significant improvements in net interest margin, consistent and sound underwriting, prudent loan growth, improvement in mortgage banking production, and continued attention to expense controls. A key component of our growth plan is strategic acquisitions with the resultant organization being immediately accretive. In concert with our Strategic Plan, we successfully completed the acquisition of National Bank of Montpelier this year, which we believe will be immediately accretive."
RDSI, Rurban's technology subsidiary, which provides data and item processing services to the banking industry, produced another outstanding earnings period with net income for 2008 up 14.0 percent over 2007. Joyce commented, "The economic environment has certainly been difficult throughout 2008, impacting RDSI. However, our management team has been able to navigate through these problems by adding value, controlling expenses, and consistently improving our service to our client banks."
2008 FINANCIAL RESULTS
----------------------
Earnings: Year Ended
December 31
(Dollars in thousands except per share data) 2008 2007
Net interest income $ 17,528 $ 14,787
Non-interest income 28,061 26,861
Total revenue 45,589 41,648
Provision for loan losses 690 521
Non-interest expense 37,557 36,637
Net income 5,217 3,257
Diluted EPS $ 1.06 $ 0.65
Net interest income was $17.5 million for 2008 compared to $14.8 million for 2007, an increase of 18.5 percent, which primarily resulted from improved margin. State Bank had been actively managing the balance sheet to a liability sensitive position, which has aided in the rapid decrease in cost of funds during the past twelve months. The consolidated 2008, or full year, margin improved 43 basis points to 3.53 percent for 2008, compared to 3.10 percent for 2007.
Non-interest income was $28.1 million for 2008 compared to $26.9 million for 2007, representing a $1.20 million, or 4.46 percent, increase year-over-year. This increase was driven by a $783,000, or 4.04 percent, increase in Data Service Fees. Increases in Customer Service Fees of $172,000, or 7.68 percent, and gains on sale of loans of $167,000, or 29.1 percent, were offset by decreases in Trust Fees of $303,000, or 8.96 percent. The continued decline in the equity markets has negatively impacted trust fees, which are generally calculated on invested balances. The improved Customer Service Fees and gain on sale of loans are a result of State Bank's continuing focus on its High Performance Checking program, well-developed referral program, and improving cross-selling of additional products.
Non-interest expense increased for 2008 nominally by $920,000, or 2.51 percent. The acquisition of Montpelier contributed approximately $250,000 of this increase, primarily from the December operating expenses and the one-time acquisition cost disclosed above. During 2008, RDSI switched from outsourcing their preparation and mailing activities to managing these mailings in-house. This increased Postage Expense by $760,000 during 2008 and this pass-through was offset by increases in revenue. RDSI also experienced an increase in non-federal taxes as it expanded into newer markets and sales tax expense in these new markets increased. Rurban controlled compensation and benefits with a mere 1.83 percent increase year-over-year. These increases were offset by expense reductions in Equipment Expenses (RDSI) and Professional Fees associated with loan workouts (State Bank).
FOURTH QUARTER RESULTS
----------------------
Earnings: Fourth Quarter Ended
December 31
(Dollars in thousands except per share data) 2008 2007
Net interest income $ 4,830 $ 3,783
Non-interest income 6,755 6,832
Revenue 11,585 10,615
Provision (credit) for loan losses 138 143
Non-interest expense 9,566 9,165
Net income (loss) 1,328 906
Diluted EPS $ 0.27 $ 0.18
Net interest income increased to $4.83 million for the quarter, compared to $3.78 million for the fourth quarter of 2007. This 27.7 percent increase, is due to a 63 basis point improvement in State Bank's net interest margin for the quarter-over-quarter period. Net interest income also increased due to the Montpelier acquisition and the recovery of $275,000 in interest collected on non-accrual loans that were resolved. State Bank continues to aggressively manage pricing on both loans and deposits, and has successfully navigated through a very difficult banking and rate environment.
Non-interest income was essentially unchanged at $6.76 million for 2008 and $6.83 million for 2007. Slight increases in data service fees and improved gain on sale of loans were offset by a sharp decline in trust fees. The decline in the equity market valuations was the cause of the reduction in trust fees.
Non-interest expense for the year-over-year fourth quarter increased $401,000, or 4.38 percent. As stated earlier, the Montpelier acquisition, which was completed on December 1, 2008, contributed $250,000 of this one-time costs incurred in connection with the increase. Excluding the cost associated with Montpelier, operating expenses increased $151,000, or 1.65 percent. Expenses were well-controlled, as increases in non-federal taxes and RDSI's decision to bring postage operations in-house were offset by reductions in Equipment Expense at RDSI and Professional Fees (State Bank), due to lower loan work-out expenses.
CONSOLIDATED BALANCE SHEET
As a result of the Montpelier acquisition, total assets at December 31, 2008 were $657.6 million compared to $585.0 million at September 30, 2008. Net loans (excluding loans held for sale) were $450.1 million at December 31, 2008 compared to $399.9 million at September 30, 2008. Total deposits were $484.2 million at year-end 2008, compared to $406.5 million at September 30, 2008. Non-interest bearing deposits at December 31, 2008 were $52.2 million, compared to $40.9 million at September 30, 2008. Total shareholder's equity increased to $61.7 million at year-end 2008, compared to $60.1 million at September 30, 2008. Because the Montpelier acquisition was an all cash purchase, no additional shares were issued. At December 31, 2007 total assets were $561.2 million, net loans were $389.3 million, deposits were $406.0 million, non-interest bearing deposits were $41.5 million and equity was $59.3 million.
BANK OPERATING RESULTS
Mr. Joyce commented, "We are pleased to report a $1.6 million increase in our Banking Group's 2008 YTD net income over 2007. Our banking model is firmly established, and Mark Klein, State Bank CEO, and his management team, are executing that model very effectively. We expect to continue to build our loan balances in 2009 in our various markets and maintain tight control on asset quality and expenses. As we stated in previous press releases, the Montpelier acquisition is immediately accretive to net income, earnings per share and return on equity. We would expect to fully realize the benefits of this acquisition by the third quarter of 2009. These incremental earnings will be an offset to the challenges we are facing within the banking industry and more specifically, our trust division, as equity balances decline.
Net income for the Banking Group was $4.5 million for 2008, compared with $2.9 million reported for the prior fiscal year.
Total loans were $450.1 million at December 31, 2008, including the contribution from Montpelier. Excluding Montpelier, organic loan growth in 2008 totaled $16.6 million, or 4.27 percent. Commercial loans were the only category that had significant growth during 2008, up $35.7 million, or 14.1 percent, to $288.9 million.
Total deposits at December 31, 2008 were $484.2 million, including the addition of Montpelier, compared to $406.0 million at December 31, 2007. The cost of deposits dropped to 1.89 percent for the fourth quarter 2008, compared to the year-ago quarter of 3.20 percent. "This reduction in funding cost is attributable to the successful management of the balance sheet to a liability sensitive position that took advantage of falling interest rates throughout 2008. We are now focusing on extending our liabilities and shortening the duration of assets to become more "asset sensitive" to position our balance sheet for increasing interest rates," commented Mr. Joyce. "Our acquisition has positioned us to fund loan growth in 2009 with core transaction deposits versus higher cost alternative funds," continued Joyce. Rurban's deposit mix continues to shift toward core transaction deposits (DDA, NOW, SAV & MMA), which accounted for 49.9 percent of total deposits for 2008, compared with 45.0 percent at prior year-end.
ASSET QUALITY
Provision for Loan Losses was $690,000 in 2008 compared to $521,000 in 2007. The 2008 fourth quarter provision for loan losses was $138,000 compared to $143,000 for the year-ago quarter. For 2008, the net charge-offs totaled $764,000, or 0.19 percent of average loans. Net charge-offs for the fourth quarter decreased slightly compared to the linked quarter to $280,000, or 0.27 percent, of average loans on an annualized basis.
(Dollars in thousands except percent data) ASSET QUALITY 4Q 2008 3Q 2008 4Q 2007 ------------- ------- ------- ------- Net charge-offs $ 280 $ 336 $ 89 Net charge-offs to avg. loans (Annualized) 0.27% 0.33% 0.09% Non-performing loans $ 5,178 $ 4,659 $ 5,990 OREO + OAO $ 1,409 $ 1,611 $ 172 Non-performing assets (NPA's) $ 6,587 $ 6,270 $ 6,162 NPA / Total assets 1.00% 1.07% 1.10% Allowance for loan losses $ 5,020 $ 4,057 $ 3,990 Allowance for loan losses / Loans 1.12% 1.01% 1.03%
Non-performing assets (loans + OREO + OAO) were $6.59 million, or 1.00 percent, of total assets at December 31, 2008, an increase of $317,000 from the linked quarter, and an increase of $425,000 from a year-ago. The acquisition of Montpelier contributed $845,000 in non-performing assets at year-end. Asset quality remains stable as we enter 2009. Consistent with external economic conditions, State Bank is seeing a slight increase in delinquencies within all segments of its portfolio, however, the current levels are not significant or alarming. The State Bank has managed through a difficult 2008, but it is not insulated from the economic factors facing the industry in 2009.
RDSI RESULTS
Revenue for the Data and Item Processing Group was $21.6 million, up $946,000, or 4.6 percent, over the $20.6 million reported for year-end 2007. Operating expenses totaled $17.3 million in 2008, compared to $16.9 million in 2007, reflecting a nominal $422,000, or 2.50 percent increase. RDSI offered over 150 products to a total of 113 community banks at year-end 2008, and it launched nine new products to help its client banks achieve their goals during 2008.
Net Income for the 2008 fiscal year was $2.82 million, compared to $2.47 million for 2007, up $346,000, or 14.0 percent. "RDSI experienced solid growth in 2008, and we have positive expectations as eight bank conversions are currently scheduled for 2009 and there is a strong pipeline of prospects," said Mr. Joyce.
Mr. Joyce concluded, "RDSI has always prided itself in providing outstanding customer service and value and delivering on that promise. These factors were certainly instrumental in RDSI attaining record earnings in 2008. We welcomed six new banking clients to our RDSI family roster, and among our existing clients, 206 additional products were purchased that will improve their efficiencies, or allow the offering of new products and services."
ABOUT RURBAN FINANCIAL CORP.
Rurban Financial Corp. is a publicly-held financial services holding company based in Defiance, Ohio. Rurban's wholly-owned subsidiaries are The State Bank and Trust Company, including Reliance Financial Services and Rurbanc Data Services, Inc. (RDSI), including DCM. The State Bank and Trust Company offers financial services through its 22 banking centers in Allen, Defiance, Fulton, Lucas, Paulding, Williams and Wood Counties, Ohio and Allen County, Indiana and a Loan Production Office in Franklin County, Ohio. Reliance Financial Services, a division of the Bank, offers a diversified array of trust and financial services to customers throughout the Midwest. RDSI and DCM provide data and item processing services to community banks in Arkansas, Florida, Illinois, Indiana, Michigan, Missouri, Nebraska, Nevada, Ohio and Wisconsin. Rurban's common stock is quoted on the NASDAQ Global Market under the symbol RBNF. The Company currently has 10,000,000 shares of stock authorized and 4,877,838 shares outstanding. The Company's website is http://www.rurbanfinancial.net.
FORWARD-LOOKING STATEMENTS
Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties inherent in the national and regional banking, insurance and mortgage industries, competitive factors specific to markets in which Rurban and its subsidiaries operate, future interest rate levels, legislative and regulatory actions, capital market conditions, general economic conditions, geopolitical events, the loss of key personnel and other factors.
Forward-looking statements speak only as of the date on which they are made, and Rurban undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made. All subsequent written and oral forward-looking statements attributable to Rurban or any person acting on our behalf are qualified by these cautionary statements.
RURBAN FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
December 31, 2008 and December 31, 2007
December December
2008 2007
------------ ------------
(Unaudited)
ASSETS
Cash and due from banks $ 18,059,532 $ 15,183,627
Federal funds sold 10,000,000 2,000,000
------------ ------------
Cash and cash equivalents 28,059,532 17,183,627
Available-for-sale securities 102,606,475 92,661,386
Loans held for sale 3,824,499 1,649,758
Loans, net of unearned income 450,111,653 389,268,744
Allowance for loan losses (5,020,197) (3,990,455)
Premises and equipment, net 17,621,262 15,128,754
Purchased software 5,867,395 4,282,563
Federal Reserve and Federal
Home Loan Bank Stock 4,244,100 4,021,200
Foreclosed assets held for sale, net 1,384,335 124,131
Accrued interest receivable 2,964,663 3,008,968
Goodwill 21,414,790 13,940,618
Core deposits and other intangibles 5,835,936 5,135,228
Cash value of life insurance 12,625,015 12,160,581
Other assets 6,079,451 6,638,895
------------ ------------
Total assets $657,618,909 $561,213,998
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Non interest bearing demand $ 52,242,626 $ 41,541,297
Interest bearing NOW 73,123,095 54,308,665
Savings 34,313,586 25,320,126
Money Market 82,025,074 61,380,252
Time Deposits 242,516,203 223,480,842
------------ ------------
Total deposits 484,220,584 406,031,182
Notes payable 1,000,000 922,457
Advances from Federal Home Loan Bank 36,646,854 24,000,000
Repurchase Agreements 43,425,978 43,006,438
Trust preferred securities 20,620,000 20,620,000
Accrued interest payable 1,965,842 2,532,914
Other liabilities 8,077,647 4,775,773
------------ ------------
Total liabilities 595,956,905 501,888,764
Shareholders' Equity
Common stock 12,568,583 12,568,583
Additional paid-in capital 15,042,781 14,923,571
Retained earnings 35,785,317 32,361,106
Accumulated other comprehensive
income (loss) (121,657) 82,235
Treasury stock (1,613,020) (610,260)
------------ ------------
Total shareholders' equity 61,662,004 59,325,235
------------ ------------
Total liabilities and
shareholders' equity $657,618,909 $561,213,998
============ ============
RURBAN FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Three Months Ended Twelve Months Ended
December 31, December 31,
---------------------- ------------------------
2008 2007 2008 2007
---------- ---------- ----------- -----------
Interest income
Loans
Taxable $6,905,698 $7,056,261 $27,473,302 $27,782,068
Tax-exempt 20,934 22,240 84,878 73,451
Securities
Taxable 1,023,333 1,106,834 4,289,728 4,283,508
Tax-exempt 252,488 161,830 686,458 645,451
Other 3,655 61,257 134,079 225,151
---------- ---------- ----------- -----------
Total interest
income 8,206,108 8,408,422 32,668,445 33,009,629
Interest expense
Deposits 2,092,363 3,383,225 10,066,325 13,595,896
Other borrowings 9,216 25,215 53,008 165,859
Retail Repurchase
Agreements 444,563 484,118 1,821,330 1,615,016
Federal Home Loan
Bank advances 411,937 276,492 1,508,115 1,037,026
Trust preferred
securities 418,017 456,427 1,691,792 1,808,520
---------- ---------- ----------- -----------
Total interest
expense 3,376,096 4,625,477 15,140,570 18,222,317
---------- ---------- ----------- -----------
Net interest income 4,830,012 3,782,945 17,527,875 14,787,312
Provision for
loan losses 138,179 142,663 689,567 521,306
---------- ---------- ----------- -----------
Net interest income
after provision
for loan losses 4,691,833 3,640,282 16,838,308 14,266,006
Non-interest income
Data service fees 5,004,376 4,914,328 20,165,451 19,382,115
Trust fees 630,331 873,069 3,081,898 3,385,320
Customer service
fees 591,053 593,665 2,416,093 2,243,745
Net gain on sales
of loans 150,238 137,611 740,985 574,000
Net realized gain
on sales of
securities -- 1,631 -- 1,998
Net proceeds from
VISA IPO -- -- 132,106 --
Investment
securities
recoveries -- -- 197,487 --
Loan servicing
fees 59,579 80,590 235,095 227,017
Gain (loss) on
sale of assets 96,124 (32,362) 247,517 29,477
Other income 223,653 263,583 844,105 1,017,727
---------- ---------- ----------- -----------
Total
non-interest
income 6,755,354 6,832,115 28,060,737 26,861,399
Non-interest expense
Salaries and
employee
benefits 4,204,104 4,134,242 17,318,103 17,007,314
Net occupancy
expense 567,120 587,150 2,170,616 2,134,950
Equipment expense 1,562,031 1,678,311 6,308,564 6,586,623
Data processing
fees 105,741 97,092 427,251 469,808
Professional fees 514,314 586,327 1,859,447 2,226,577
Marketing expense 246,770 218,549 831,727 820,528
Printing and
office supplies 132,862 151,943 554,267 661,760
Telephone and
communication 427,927 451,918 1,686,834 1,781,277
Postage and
delivery expense 515,129 376,777 2,165,098 1,545,340
State, local and
other taxes 382,670 115,441 985,503 584,031
Employee expense 277,730 281,682 1,084,028 1,083,056
Other expenses 629,611 485,154 2,165,175 1,735,346
---------- ---------- ----------- -----------
Total
non-interest
expense 9,566,009 9,164,586 37,556,613 36,636,610
---------- ---------- ----------- -----------
Income before
income tax expense 1,881,178 1,307,811 7,342,432 4,490,795
Income tax
expense 553,159 402,275 2,125,193 1,234,160
---------- ----------- ----------- -----------
Net income $1,328,019 $ 905,536 $ 5,217,239 $ 3,256,635
========== ========== =========== ===========
Earnings per
common share:
Basic $ 0.27 $ 0.18 $ 1.06 $ 0.65
========== ========== =========== ===========
Diluted $ 0.27 $ 0.18 $ 1.06 $ 0.65
========== ========== =========== ===========
RURBAN FINANCIAL CORP.
CONSOLIDATED FINANCIAL
HIGHLIGHTS
(Unaudited)
----------------------------- ------------------ ------------------
Three Months Twelve Months
Ended Ended
December 31, December 31,
------------------ ------------------
(dollars in thousands
except per share data) 2008 2007 2008 2007
----------------------------- -------- -------- -------- --------
EARNINGS
Net interest income $ 4,830 $ 3,783 $ 17,528 $ 14,787
Provision for loan loss $ 138 $ 143 $ 690 $ 521
Non-interest income $ 6,755 $ 6,832 $ 28,061 $ 26,861
Revenue (net interest
income plus
non-interest income) $ 11,585 $ 10,615 $ 45,589 $ 41,648
Non-interest expense $ 9,566 $ 9,165 $ 37,557 $ 36,637
Net income $ 1,328 $ 906 $ 5,217 $ 3,257
PER SHARE DATA
Basic earnings per share $ 0.27 $ 0.18 $ 1.06 $ 0.65
Diluted earnings per share $ 0.27 $ 0.18 $ 1.06 $ 0.65
Book value per share $ 12.63 $ 11.92 $ 12.63 $ 11.92
Tangible book value
per share $ 7.48 $ 8.00 $ 7.48 $ 8.00
Cash dividend per share $ 0.09 $ 0.07 $ 0.34 $ 0.26
PERFORMANCE RATIOS
Return on average assets 0.88% 0.64% 0.91% 0.59%
Return on average equity 8.75% 6.15% 8.70% 5.62%
Net interest margin
(tax equivalent) 3.83% 3.12% 3.53% 3.10%
Net interest margin -
banking group 4.06% 3.43% 3.80% 3.46%
Non-interest expense /
Average assets 6.31% 6.48% 6.53% 6.58%
Efficiency Ratio -
bank (non-GAAP) 73.15% 76.93% 72.48% 80.07%
MARKET DATA PER SHARE
Market value per share -
Period end $ 7.60 $ 12.49 $ 7.60 $ 12.49
Market as a % of book 60% 105% 60% 105%
Cash dividend yield 4.74% 2.24% 4.47% 2.08%
Period-end common shares
outstanding (000) 4,881 4,979 4,881 4,979
Common stock market
capitalization ($000) $ 37,099 $ 62,188 $ 37,099 $ 62,188
CAPITAL & LIQUIDITY
Equity to assets 9.4% 10.6% 9.4% 10.6%
Period-end tangible equity
to tangible assets 5.8% 7.1% 5.8% 7.1%
Total risk-based capital
ratio (Estimate) 13.2% 16.0% 13.2% 16.0%
ASSET QUALITY
Net charge-offs /
(Recoveries) $ 280 $ 89 $ 764 $ 248
Net loan charge-offs (Ann.)
/ Average loans 0.27% 0.09% 0.19% 0.07%
Non-performing loans $ 5,178 $ 5,990 $ 5,178 $ 5,990
OREO / OAOs $ 1,409 $ 172 $ 1,409 $ 172
Non-performing assets $ 6,587 $ 6,162 $ 6,587 $ 6,162
Non-performing assets /
Total assets 1.00% 1.10% 1.00% 1.10%
Allowance for loan losses /
Total loans 1.12% 1.03% 1.12% 1.03%
Allowance for loan losses /
Non-performing assets 76.2% 64.8% 76.2% 64.8%
END OF PERIOD BALANCES
Total loans, net of
unearned income $450,112 $389,269 $450,112 $389,269
Allowance for loan loss $ 5,020 $ 3,990 $ 5,020 $ 3,990
Total assets $657,619 $561,214 $657,619 $561,214
Deposits $484,221 $406,031 $484,221 $406,031
Stockholders' equity $ 61,662 $ 59,325 $ 61,662 $ 59,325
Full-time
equivalent employees 306 275 306 275
AVERAGE BALANCES
Loans $412,222 $389,529 $401,770 $381,453
Total earning assets $518,707 $496,782 $508,250 $488,289
Total assets $606,655 $565,779 $575,491 $556,572
Deposits $431,076 $413,473 $408,042 $412,767
Stockholders' equity $ 60,686 $ 58,928 $ 59,964 $ 57,945
RURBAN FINANCIAL CORP.
CONSOLIDATED FINANCIAL
HIGHLIGHTS
(Unaudited)
------------------ -------- -------- -------- -------- --------
(dollars
in thousands
except per 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
share data) 2008 2008 2008 2008 2007
------------------ -------- -------- -------- -------- --------
EARNINGS
Net interest
income $ 4,830 $ 4,448 $ 4,432 $ 3,817 $ 3,783
Provision for
loan loss $ 138 $ 146 $ 213 $ 192 $ 143
Non-interest
income $ 6,755 $ 6,989 $ 6,801 $ 7,516 $ 6,832
Revenue (net
interest income
plus
non-interest
income) $ 11,585 $ 11,437 $ 11,233 $ 11,333 $ 10,615
Non-interest
expense $ 9,566 $ 9,279 $ 9,111 $ 9,601 $ 9,165
Net income $ 1,328 $ 1,424 $ 1,356 $ 1,109 $ 906
PER SHARE DATA
Basic
earnings
per share $ 0.27 $ 0.29 $ 0.28 $ 0.22 $ 0.18
Diluted
earnings
per share $ 0.27 $ 0.29 $ 0.28 $ 0.22 $ 0.18
Book value
per share $ 12.64 $ 12.25 $ 12.08 $ 12.11 $ 11.92
Tangible book
value per share $ 7.48 $ 8.65 $ 8.41 $ 8.10 $ 8.00
Cash dividend
per share $ 0.09 $ 0.09 $ 0.08 $ 0.08 $ 0.07
PERFORMANCE RATIOS
Return on
average assets 0.88% 0.99% 0.94% 0.78% 0.64%
Return on
average equity 8.75% 9.54% 9.09% 7.50% 6.15%
Net interest
margin
(tax equivalent) 3.83% 3.56% 3.55% 3.26% 3.12%
Net interest
margin
(Bank Only) 4.06% 3.84% 3.83% 3.45% 3.43%
Non-interest
expense /
Average assets 6.31% 6.44% 6.29% 6.77% 6.48%
Efficiency Ratio
- bank
(non-GAAP) 73.15% 71.13% 69.85% 75.90% 76.93%
MARKET DATA
PER SHARE
Market value
per share --
Period end $ 7.60 $ 9.00 $ 9.52 $ 10.24 $ 12.49
Market as a %
of book 60% 73% 79% 85% 105%
Cash dividend
yield 4.74% 4.00% 3.36% 3.13% 2.24%
Period-end
common shares
outstanding
(000) 4,881 4,906 4,914 4,942 4,979
Common stock
market
capitalization
($000) $ 37,099 $ 44,154 $ 46,781 $ 50,605 $ 62,188
CAPITAL & LIQUIDITY
Equity to assets 9.4% 10.3% 10.3% 10.5% 10.6%
Period-end
tangible equity
to tangible
assets 5.8% 7.5% 7.4% 7.2% 7.1%
Total
risk-based
capital ratio
(Estimate) 13.2% 16.2% 15.7% 15.8% 16.0%
ASSET QUALITY
Net charge-offs
/ (Recoveries) $ 280 $ 336 $ (18) $ 166 $ 89
Net loan
charge-offs
(Ann.) /
Average loans 0.27% 0.33% (0.02%) 0.17% 0.09%
Non-performing
loans $ 5,178 $ 4,659 $ 5,141 $ 5,305 $ 5,990
OREO / OAOs $ 1,409 $ 1,611 $ 1,566 $ 1,662 $ 172
Non-performing
assets $ 6,587 $ 6,270 $ 6,707 $ 6,967 $ 6,162
Non-performing
assets /
Total assets 1.00% 1.07% 1.16% 1.22% 1.10%
Allowance for
loan losses /
Total loans 1.12% 1.01% 1.04% 1.02% 1.03%
Allowance for
loan losses /
Non-performing
assets 76.2% 64.7% 63.3% 57.6% 64.8%
END OF PERIOD BALANCES
Total loans,
net of
unearned
income $450,112 $399,910 $404,435 $391,963 $389,269
Allowance for
loan loss $ 5,020 $ 4,057 $ 4,247 $ 4,016 $ 3,990
Total assets $657,619 $585,022 $576,513 $571,733 $561,214
Deposits $484,221 $406,454 $402,558 $416,712 $406,031
Stockholders'
equity $ 61,662 $ 60,117 $ 59,362 $ 59,870 $ 59,325
Full-time
equivalent
employees 306 271 273 272 275
AVERAGE BALANCES
Loans $412,222 $401,790 $404,756 $389,917 $389,529
Total earning
assets $518,707 $506,760 $510,521 $498,731 $496,782
Total assets $606,655 $576,774 $579,004 $567,129 $565,779
Deposits $431,076 $403,064 $412,080 $412,424 $413,473
Stockholders'
equity $ 60,686 $ 59,717 $ 59,671 $ 59,149 $ 58,928
Rurban Financial Corp.
Segment Reporting
Fourth Quarter Ended December 31, 2008
($ in Thousands)
--------- ---------- --------- ----------- ---------
Parent
Income Company Rurban
Statement Total Data and Elimination Financial
Measures Banking Processing Other Entries Corp.
------------ --------- ---------- --------- ----------- ---------
Interest
Income $ 8,213 $ -- $ 1 $ (8) $ 8,206
Interest
Expense 2,953 13 418 (8) 3,376
Net Interest
Income 5,260 (13) (417) -- 4,830
Provision For
Loan Loss 138 -- -- -- 138
Non-interest
Income 1,747 5,394 399 (785) 6,755
Non-interest
Expense 5,254 4,299 798 (785) 9,566
Net Income
QTD $ 1,146 $ 715 $ (533) $ -- $ 1,328
Performance
Measures
------------
Average
Assets -
QTD $596,469 $ 19,804 $ 82,775 $ (92,393) $606,655
ROAA 0.77% 14.44% -- -- 0.88%
Average
Equity -
QTD $ 63,224 $ 15,816 $ 60,686 $ (79,040) $ 60,686
ROAE 7.25% 18.08% -- -- 8.75%
Efficiency
Ratio - % 73.15% -- -- -- 80.93%
Average
Loans -
QTD $412,819 $ -- $ -- $ (597) $412,222
Average
Deposits
- QTD $435,235 $ -- $ -- $ (4,159) $431,076
Rurban Financial Corp.
Segment Reporting
Twelve Months Ended December 31, 2008
($ in Thousands)
------------------------------------------------
Parent
Company Rurban
Income Statement Total Data and Elimination Financial
Measures Banking Processing Other Entries Corp.
---------------- ------------------------------------------------
Interest Income $ 32,745 $ 1 $ 2 $ (79) $ 32,669
Interest Expense 13,417 111 1,692 (79) 15,141
Net Interest
Income 19,328 (110) (1,690) -- 17,528
Provision For
Loan Loss 690 -- -- -- 690
Non-interest
Income 7,748 21,676 1,636 (2,999) 28,061
Non-interest
Expense 20,088 17,295 3,172 (2,999) 37,556
Net Income YTD $ 4,513 $ 2,819 $ (2,115) $ -- $ 5,217
Performance Measures
--------------------
Average Assets
- YTD $565,395 $ 20,060 $ 82,030 $(91,994) $575,491
ROAA 0.80% 14.05% -- -- 0.91%
Average Equity
- YTD $ 60,396 $ 15,797 $ 59,964 $(76,193) $ 59,964
ROAE 7.47% 17.85% -- -- 8.70%
Efficiency
Ratio - % 72.48% -- -- -- 80.82%
Average Loans
- YTD $403,302 $ -- $ -- $ (1,532) $401,770
Average Deposits
- YTD $422,311 $ -- $ -- $(14,269) $408,042
Rurban Financial Corp.
Proforma Performance Measurement
Quarterly Comparison - Fourth Quarter 2008
($ in Thousands)
----------------------------------------------------
Parent
Company Rurban
Total Data and Elimination Financial
Banking Processing Other Entries Corp.
----------------------------------------------------
Revenue
-------
4Q08 $ 7,007 $ 5,381 $ (18) $ (785) $ 11,585
3Q08 $ 6,877 $ 5,294 $ 5 $ (738) $ 11,438
2Q08 $ 6,729 $ 5,285 $ (15) $ (766) $ 11,233
1Q08 $ 6,464 $ 5,606 $ (27) $ (710) $ 11,333
4Q07 $ 6,232 $ 5,184 $ (114) $ (687) $ 10,615
4th Quarter
Comparison $ 775 $ 197 $ 96 $ -- $ 970
Non-interest
Expenses
------------
4Q08 $ 5,254 $ 4,299 $ 798 $ (785) $ 9,566
3Q08 $ 5,003 $ 4,286 $ 728 $ (738) $ 9,279
2Q08 $ 4,812 $ 4,316 $ 748 $ (766) $ 9,110
1Q08 $ 5,018 $ 4,394 $ 899 $ (710) $ 9,601
4Q07 $ 4,908 $ 4,202 $ 742 $ (687) $ 9,164
4th Quarter
Comparison $ 346 $ 97 $ 56 $ -- $ 402
Net Income
----------
4Q08 $ 1,146 $ 715 $ (533) $ -- $ 1,328
3Q08 $ 1,233 $ 664 $ (473) $ -- $ 1,424
2Q08 $ 1,217 $ 640 $ (501) $ -- $ 1,356
1Q08 $ 917 $ 800 $ (608) $ -- $ 1,109
4Q07 $ 836 $ 648 $ (578) $ -- $ 906
4th Quarter
Comparison $ 310 $ 67 $ 45 $ -- $ 422
Average Assets
--------------
4Q08 $596,469 $ 19,804 $ 82,775 $(92,393) $606,655
3Q08 $557,306 $ 20,344 $ 81,707 $(82,583) $576,774
2Q08 $560,223 $ 20,214 $ 81,579 $(83,011) $579,004
1Q08 $547,502 $ 20,103 $ 81,297 $(81,773) $567,129
4Q07 $546,609 $ 20,014 $ 80,827 $(81,671) $565,779
4th Quarter
Comparison $ 49,860 $ (210) $ 1,948 $ -- $ 40,876
ROAA
----
4Q08 0.77% 14.44% -- -- 0.88%
3Q08 0.88% 13.06% -- -- 0.99%
2Q08 0.87% 12.66% -- -- 0.94%
1Q08 0.67% 15.92% -- -- 0.78%
4Q07 0.61% 12.95% -- -- 0.64%
4th Quarter
Comparison 0.16% 1.49% -- -- 0.24%
Average Equity
--------------
4Q08 $ 63,224 $ 15,816 $ 60,686 $(79,040) $ 60,686
3Q08 $ 59,899 $ 16,063 $ 59,717 $(75,962) $ 59,717
2Q08 $ 59,395 $ 15,861 $ 59,671 $(75,256) $ 59,671
1Q08 $ 59,044 $ 15,282 $ 59,149 $(74,326) $ 59,149
4Q07 $ 58,115 $ 15,222 $ 58,928 $(73,337) $ 58,928
4th Quarter
Comparison $ 5,109 $ 594 $ 1,758 $ -- $ 1,758
ROAE
----
4Q08 7.25% 18.08% -- -- 8.75%
3Q08 8.23% 16.53% -- -- 9.54%
2Q08 8.20% 16.14% -- -- 9.09%
1Q08 6.21% 20.94% -- -- 7.50%
4Q07 5.75% 17.03% -- -- 6.15%
4th Quarter
Comparison 1.50% 1.05% -- -- 2.60%
Efficiency
Ratio
----------
4Q08 73.15% 73.15% -- -- 80.92%
3Q08 71.13% 79.79% -- -- 79.60%
2Q08 69.85% 80.50% -- -- 79.56%
1Q08 75.90% 77.28% -- -- 83.19%
4Q07 76.68% 79.77% -- -- 84.49%
4th Quarter
Comparison (3.53%) (6.62%) -- -- (3.57%)