DEFIANCE, Ohio, Oct. 28, 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 2009 third quarter earnings of $160 thousand, or $0.03 per diluted share, compared to the $1.43 million, or $0.29 per diluted share, reported in the 2008 third quarter, and the $1.00 million, or $0.20 per diluted share, for the 2009 second quarter. For the 2009 third quarter, a loan loss provision of $898 thousand was taken to address problem credits. In addition, pre-tax charges associated with the planned spin-off of RDSI Banking Systems, Rurban's data and item processing subsidiary, included increased legal fees of $155 thousand, accelerated depreciation of the ITI software used at RDSI of $360 thousand, and expenses incurred at RDSI for the ramp-up conversion of clients to the Single Source(tm) system totaling $335 thousand. The details explaining the planned spin-off were included in our prior Press Release dated October 22, 2009.
For the first nine months of 2009, consolidated earnings were $2.3 million, or $0.46 per diluted share, compared to $3.9 million, or $0.79 per diluted share, recorded for the first nine months of 2008. The year-to-date earnings have been impacted by an increased provision for loan loss reserve of $1.3 million compared to the 2008 provision, $300 thousand in special FDIC insurance assessments, $411 thousand in legal fees associated with the contemplated RDSI spin-off and the related merger of RDSI with new Core Banking Systems, $360 thousand in additional accelerated depreciation at RDSI and expenses incurred at RDSI to ramp-up for converting client banks to the Single Source(tm) system totaling $335 thousand. Offsetting these cost were gains from the sale of securities of $477 thousand recorded in the second quarter 2009.
Kenneth A. Joyce, President and CEO of Rurban Financial Corp., stated, "While the banking industry remains difficult, we are excited about our future as we are making progress in executing our strategic plan to keep our companies competitive and on the cutting edge of technology. A key part of this strategic direction is our intended spin-off of RDSI Banking Systems from the Holding Company. We believe this action will increase RDSI's long-term valuation. Although we faced many challenges over the last several months in executing this strategy, we have, and will continue to incur, additional expenses associated with the spin-off, and we believe that taking a more aggressive approach with our strategic plan is the right direction to bring value to our shareholders."
The State Bank and Trust Company, the Banking Segment, reported earnings of $712 thousand in the third quarter of 2009 compared to $1.2 million in the third quarter of 2008. This decline was primarily driven by the additional $752 thousand of loan loss reserves taken this quarter, compared to the previous year quarter.
RDSI earnings were $8 thousand during the third quarter 2009, down from the $664 thousand earned in the year-ago quarter, and $608 thousand reported for the second quarter 2009. This decline in earnings is due to the pre-tax $695 thousand of expenses associated with the proposed spin-off and the acquisition by RDSI of its own intellectual property through a strategic partnership with New Core Banking Systems versus its previous use of third party processing software.
As a background to the spin-off, RDSI announced in April, 2009 that it had entered into a strategic partnership with New Core Holdings, Inc. d/b/a New Core Banking Systems, to be the exclusive provider of New Core's Single Source(tm) banking application to the banking industry. As part of this partnership, RDSI and New Core Banking Systems entered into an Agreement and Plan of Merger that provides for the merger of RDSI and New Core Banking Systems. A prerequisite to this merger would be the spin-off of RDSI from Rurban, resulting in RDSI becoming a separate independent public company. As detailed in our Press Release dated October 22, 2009, we are moving forward in connection with the planned spin-off and we currently anticipate that the spin-off would be completed in the first quarter of 2010, subject to the satisfaction of a number of conditions. It is expected that the merger between RDSI and New Core Banking Systems will be completed immediately following the contemplated spin-off.
The following chart and narrative reflect the combined results of Rurban across both of its business segments, banking and data / item processing:
CONSOLIDATED - THIRD QUARTER RESULTS ------------------------------------ (Dollars in thousands except per share data) Earnings: 3Q 2009 2Q 2009 3Q 2008 --------- ------- ------- ------- Net interest income $ 5,337 $ 5,361 $ 4,448 Non-interest income 7,076 7,897 6,989 Revenue 12,413 13,258 11,437 Provision for loan losses 898 799 146 Non-interest expense 11,454 11,108 9,279 Net income 160 1,003 1,424 Diluted EPS $ 0.03 $ 0.20 $ 0.29
Net interest income increased to $5.3 million for the quarter, compared to $4.5 million for the third quarter of 2008. This 20.0 percent increase is due primarily to the acquisition of the five banking centers in Williams County, coupled with a 22 basis point improvement in State Bank's net interest margin for the year-over-year period. The net interest margin continued, for the second consecutive quarter, to be above 4 percent. By implementing an aggressive asset liability process, the Company has positioned the balance sheet to be asset-sensitive, which should provide for additional margin improvement, as rates will most likely increase in the future. Loan growth totaled $7.2 million, or 6.5 percent on an annualized basis for the third quarter of 2009.
Non-interest income totaled $7.1 million for the third quarter of 2009, compared to $7.0 million for the 2008 third quarter. Mortgage banking revenue increased gain-on-sale of loans to $722 thousand for the 2009 third quarter from the $133 thousand for the 2008 third quarter. Offsetting this increase was a decline in Trust fees of $136 thousand due to the decline in the equity market valuations and a decrease in Data Processing revenue of $141 thousand. During the third quarter of 2008, the company recorded $223 thousand in gain-on-sale of assets from the sale of the real estate of a closed branch office.
Non-interest expense for the 2009 third quarter totaled $11.5 million compared to $9.3 million for the third quarter of 2008, for an increase of $2.2 million. Approximately $429 thousand is attributable to the core operating expenses related to the December 2008 acquisition of National Bank of Montpelier and its Williams County banking centers. Also contributing to the increase, was the aforementioned increase in legal fees associated with the planned spin-off of RDSI of $155 thousand, accelerated depreciation of the ITI software used at RDSI of $360 thousand, and expenses incurred at RDSI for ramp-up for converting clients to the Single Source(tm) system totaling $335 thousand. Mortgage banking expenses increased by $545 thousand for the third quarter 2009 compared to the third quarter 2008.
CONSOLIDATED BALANCE SHEET
Total assets were $673.7 million on September 30, 2009, up $88.7 million from 12 months ago primarily due to the National Bank of Montpelier acquisition, and up $12.2 million from the 2009 second quarter. Loans were $448.4 million at September 30, 2009, up $48.5 million from the 2008 third quarter and up $7.2 million compared to last quarter. Total deposits were $492.3 million at September 30, 2009, up $85.8 million from September 30, 2008 and up $19.3 million from second quarter of 2009. Total available-for-sale securities increased by $1.6 million, up to $111.6 million at September 30, 2009 compared to the second quarter balance of $110.0 million. Total shareholders' equity increased to $64.7 million at September 30, 2009, compared to $60.1 million for the year-ago quarter, and increased from the $63.4 million for the second quarter 2009.
BANK OPERATING RESULTS
The Banking Segment earnings for the third quarter of 2009 were $712 thousand, compared to $1.2 million for the third quarter of 2008, and $1.1 million for the second quarter of 2009.
Mr. Joyce commented, "While State Bank continues to stabilize its asset quality, the outlook for the industry as a whole continues to indicate a struggle with many challenges to overcome. Unfortunately, there is no 'quick cure' for this economic climate, and it will take into 2010 to recover, assuming that there is an accompanying economic recovery. We are hopeful, but we need to remain realistic and cautious. The future level of non-performers will be largely dependent on the recovery of the economy in general."
Total loans were $448.4 million at September 30, 2009 up from $399.9 million from the year-ago quarter and up from the $441.2 million reported in the second quarter of 2009. Loan growth continues despite the very difficult economic environment, primarily driven by a decline in lending by regional banks. It is expected that loan growth will be slower, as overall loan requests have slowed in the past 90 days, which will probably result in minimal loan growth for the next six months.
Total deposits at September 30, 2009 were $492.3 million, compared to $473.0 million at June 30, 2009 and $406.5 million for the year-ago quarter. The cost of deposits dropped to 1.28 percent for the third quarter 2009, compared to the year-ago quarter cost of 2.19 percent. State Bank continued to manage toward a better deposit mix of core transaction deposits (DDA, NOW, SAV & MMA), which accounted for 54.4 percent of total deposits for the third quarter of 2009, compared with 49.5 percent for the year-ago quarter. Core transaction growth for the quarter totaled $14.5 million. This growth is coming from business customers and individual households who are building cash balances. Despite lower offering rates, customers continued their flight to the safety of FDIC insurance and continued to place funds into trusted banking centers.
Ken Joyce stated, "In an effort to improve the profitability of the Banking Segment, we will consolidate our Lima Banking Centers on January 8, 2010. The Elida Road Banking Center will be consolidated into the Market Street location. Existing customers are currently making the transition to the Market Street location."
ASSET QUALITY
The Provision for Loan Losses was $898 thousand in the third quarter of 2009, compared to $799 thousand for the linked-quarter and $146 thousand for the third quarter of 2008. Loans identified in past quarters as non-performers have shown further credit deterioration, requiring the application of additional loan loss provisions. For the first nine months of 2009 charge-offs totaled $1.28 million, or 0.38 percent of average loans. The following chart and narrative summarizes the asset quality picture:
(Dollars in thousands except percent data) ASSET QUALITY 3Q 2009 2Q 2009 3Q 2008 ------------- ------- ------- ------- Net charge-offs $ 837 $ 275 $ 336 Net charge-offs to avg loans (Annualized) 0.73% 0.25% 0.33% Non-performing loans $ 9,646 $10,173 $ 4,659 OREO + OAO $ 1,748 $ 1,346 $ 1,611 Non-performing assets (NPA's) $11,394 $11,519 $ 6,270 NPA / Total assets 1.69% 1.74% 1.07% Allowance for loan losses $ 5,934 $ 5,873 $ 4,057 Allowance for loan losses / Loans 1.32% 1.33% 1.01%
Non-performing assets (loans + OREO + OAO=NPA) were $11.4 million, or 1.69 percent, of total assets at September 30, 2009, an increase of $5.1 million from the year-ago quarter. Total non-performing assets decreased by $125 thousand over the previous quarter's balances, moving down slightly to 1.69 percent of assets, versus 1.74 percent for the second quarter. In addition to the above mentioned non-performers, management continues to be very proactive in reaching out to customers to restructure loans. Total restructured loan balances were $6.9 million for the third quarter, compared to $7.0 million reported last quarter. There were no new credits that were added to the restructured loan categories during the quarter. All loans that were restructured are currently paying under the new terms, however, these set of assets pose a higher risk of further credit deterioration.
The Bank continues to have minimal exposure in real estate development loans, which appears to be the category having the most risk in the current economy. The Bank's total outstanding balance of loans within this category is $2.6 million. Most of these loans are currently non-performing, although it is believed, all of them have been adequately reserved. Delinquencies have been improving over the last eight months and are at 2.05 percent at quarter-end, which is considerably better than national averages.
RDSI OPERATING RESULTS
RDSI, the Data and Item Processing Segment, reported 2009 third quarter net income of $8 thousand, compared to $664 thousand reported for the prior-year third quarter. Mr. Joyce commented, "RDSI has started the transition to becoming a stand-alone public company. Going forward, we expect a loss for this Company as we transition throughout 2010. The cost to spin-off the company, along with running two separate software systems through 2010, will carry a higher level of operating expenses for this company. Revenues were down slightly for the third quarter, and we expect this trend to continue through 2010. With this said, we are working hard to be the service provider of choice for our banking customers as we migrate over to New Core's Single Source(tm) system." Total revenue for the third quarter of 2009 was $5.2 million, down from the $5.3 million reported for the third quarter of 2008.
As of September 2009, RDSI clients totaled 116 banking organizations. RDSI provided Data Processing services to 75 clients and Item Processing services to a total of 91 clients.
Operating expenses were $5.2 million for the third quarter of 2009, up $859 thousand, or 20.1 percent, from the third quarter of 2008. The increase was largely due to the aforementioned accelerated depreciation of $360 thousand and expenses incurred to ramp-up for converting client banks to the Single Source(tm) system totaling $335 thousand.
Mr. Joyce concluded, "These are exciting times for RDSI. RDSI has always been a contributor to Rurban's overall performance and we are confident in its success in integrating banks onto the Single Source(tm) banking application. We expect RDSI to continue its trend of being a top technology provider long into the future. I encourage our investors to review the October 22, 2009 Press Release that provides additional details relative to the contemplated spin-off."
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 RDSI Banking Systems (RDSI), including DCM. The State Bank and Trust Company offers financial services through its 20 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, Kansas, 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 4,861,779 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 except as required by law. All subsequent written and oral forward-looking statements attributable to Rurban or any person acting on our behalf are qualified by these cautionary statements.
ADDITIONAL INFORMATION
Rurban and/or RDSI plan to make appropriate filings with the SEC concerning the contemplated spin-off and the merger transaction between RDSI and New Core Banking Systems. Those filings will include a combined information statement to be delivered to Rurban shareholders in connection with the spin-off and a proxy statement to be delivered to the New Core shareholders in connection with the approval of the merger transaction by the New Core shareholders. The combined information statement/proxy statement and other documents filed by Rurban and/or RDSI with the SEC will contain important information about Rurban, RDSI, New Core and the merger transaction. WE URGE INVESTORS AND NEW CORE SHAREHOLDERS TO READ CAREFULLY THE COMBINED INFORMATION STATEMENT/PROXY STATEMENT AND OTHER DOCUMENTS FILED WITH THE SEC, INCLUDING ANY AMENDMENTS OR SUPPLEMENTS ALSO FILED WITH THE SEC. NEW CORE SHAREHOLDERS IN PARTICULAR SHOULD READ THE COMBINED INFORMATION STATEMENT/PROXY STATEMENT CAREFULLY BEFORE MAKING A DECISION CONCERNING THE MERGER TRANSACTION. Investors and shareholders will be able to obtain a free copy of the combined information statement/proxy statement - along with other filings containing information about Rurban and RDSI - at the SEC's website at http://www.sec.gov. Copies of the combined information statement/proxy statement, and any filings with the SEC incorporated by reference in such document, can also be obtained free of charge by directing a request to Rurban Financial Corp., 401 Clinton Street, Defiance, Ohio 43512; Attention: Ms. Valda Colbart, Investor Relations Officer; Telephone: (419) 784-2759.
This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of securities in any jurisdiction in which the offer, solicitation, or sale is unlawful before registration or qualification of the securities under the securities laws of the jurisdiction. Rurban and RDSI contemplate that the RDSI common shares to be issued to shareholders of New Core Banking Systems in the merger will not be registered under the Securities Act of 1933, as amended, in reliance upon an applicable exemption from registration requirements. In this case, the RDSI common shares issued to shareholders of New Core Banking Systems in the merger may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
RURBAN FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
September 30, 2009 and December 31, 2008 and September 30, 2008
September December September
2009 2008 2008
------------ ------------ ------------
(Unaudited) (Unaudited)
ASSETS
Cash and due from banks $ 31,055,035 $ 18,059,532 $ 25,408,171
Federal funds sold -- 10,000,000 --
------------ ------------ ------------
Cash and cash
equivalents 31,055,035 28,059,532 25,408,171
Available-for-sale
securities 111,561,500 102,606,475 94,436,350
Loans held for sale 11,370,884 3,824,499 1,478,333
Loans, net of unearned
income 448,392,963 450,111,653 399,910,475
Allowance for loan
losses (5,934,165) (5,020,197) (4,057,213)
Premises and equipment,
net 17,217,039 17,621,262 15,496,474
Purchased software 5,273,311 5,867,395 5,964,281
Federal Reserve and
Federal Home Loan Bank
Stock 3,748,250 4,244,100 4,148,400
Foreclosed assets held
for sale, net 1,748,376 1,384,335 1,534,207
Accrued interest
receivable 2,851,934 2,964,663 2,835,552
Goodwill 21,414,790 21,414,790 13,940,618
Core deposits and other
intangibles 5,177,508 5,835,936 4,615,084
Cash value of life
insurance 12,953,972 12,625,015 12,513,124
Other assets 6,917,729 6,079,451 6,797,920
------------ ------------ ------------
Total assets $673,749,126 $657,618,909 $585,021,776
============ ============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Non interest bearing
demand $ 54,149,280 $ 52,242,626 $ 40,952,936
Interest bearing NOW 80,403,328 73,123,095 60,842,082
Savings 44,658,696 34,313,586 24,402,064
Money Market 88,676,904 82,025,074 74,958,096
Time Deposits 224,404,005 242,516,203 205,299,166
------------ ------------ ------------
Total deposits 492,292,213 484,220,584 406,454,344
Notes payable 2,357,816 1,000,000 --
Advances from Federal
Home Loan Bank 39,868,884 36,646,854 40,229,923
Fed Funds Purchased -- -- 5,000,000
Repurchase Agreements 46,138,646 43,425,978 44,553,855
Trust preferred
securities 20,620,000 20,620,000 20,620,000
Accrued interest payable 1,382,015 1,965,842 1,575,146
Other liabilities 6,421,448 8,077,647 6,471,375
------------ ------------ ------------
Total liabilities 609,081,022 595,956,905 524,904,643
Shareholders' Equity
Common stock 12,568,583 12,568,583 12,568,583
Additional paid-in
capital 15,132,715 15,042,781 14,996,187
Retained earnings 36,737,207 35,785,317 34,898,499
Accumulated other
comprehensive income
(loss) 1,998,910 (121,657) (944,518)
Treasury stock (1,769,311) (1,613,020) (1,401,618)
------------ ------------ ------------
Total shareholders'
equity 64,668,104 61,662,004 60,117,133
------------ ------------ ------------
Total liabilities and
shareholders' equity $673,749,126 $657,618,909 $585,021,776
============ ============ ============
RURBAN FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------ --------------------------
2009 2008 2009 2008
----------- ----------- ------------ ------------
Interest income
Loans
Taxable $ 6,884,515 $ 6,736,100 $ 20,554,775 $ 20,567,604
Tax-exempt 20,944 22,125 71,791 63,944
Securities
Taxable 944,579 1,135,931 3,158,649 3,266,395
Tax-exempt 294,716 109,805 766,931 433,970
Other 41,621 17,635 71,498 130,424
----------- ----------- ------------ ------------
Total
interest
income 8,186,375 8,021,596 24,623,644 24,462,337
Interest expense
Deposits 1,559,730 2,258,470 5,115,379 7,973,962
Other
borrowings 43,745 16,803 91,548 43,792
Retail
Repurchase
Agreements 437,419 465,452 1,296,242 1,376,767
Federal Home
Loan Bank
advances 417,359 416,696 1,221,487 1,096,178
Trust preferred
securities 391,407 415,686 1,185,021 1,273,775
----------- ----------- ------------ ------------
Total
interest
expense 2,849,660 3,573,107 8,909,677 11,764,474
----------- ----------- ------------ ------------
Net interest
income 5,336,715 4,448,489 15,713,967 12,697,863
Provision for
loan losses 898,050 146,173 2,192,042 551,388
----------- ----------- ------------ ------------
Net interest
income after
provision for
loan losses 4,438,665 4,302,316 13,521,925 12,146,475
Non-interest
income
Data service
fees 4,806,359 4,947,727 14,734,942 15,161,075
Trust fees 644,427 780,726 1,869,083 2,451,567
Customer
service fees 700,042 626,008 1,923,744 1,825,040
Net gain on
sales of loans 722,234 132,999 2,738,626 590,747
Net realized
gain on sales
of securities -- -- 477,591 --
Net proceeds
from VISA IPO -- -- -- 132,106
Investment
securities
recoveries -- -- -- 197,487
Loan servicing
fees 126,265 57,356 298,001 175,516
Gain (loss) on
sale of assets (52,976) 222,815 (95,390) 151,393
Other income 129,360 221,081 474,410 620,452
----------- ----------- ------------ ------------
Total
non-interest
income 7,075,711 6,988,712 22,421,007 21,305,383
Non-interest
expense
Salaries and
employee
benefits 5,422,005 4,239,578 15,644,731 13,113,999
Net occupancy
expense 752,532 526,301 2,336,652 1,603,496
Equipment
expense 2,041,339 1,553,188 5,353,637 4,746,533
Data processing
fees 151,320 120,151 495,782 321,510
Professional
fees 705,415 489,910 1,846,458 1,345,133
Marketing
expense 232,294 247,120 655,597 584,957
Printing and
office
supplies 104,036 115,667 435,913 421,405
Telephone and
communication 406,673 415,120 1,212,901 1,258,907
Postage and
delivery
expense 511,525 511,522 1,635,037 1,649,969
State, local
and other
taxes 235,067 235,647 701,120 602,833
Employee
expense 293,634 272,315 810,776 806,298
Other expenses 598,275 552,379 1,908,592 1,535,564
----------- ----------- ------------ ------------
Total
non-interest
expense 11,454,115 9,278,898 33,037,196 27,990,604
----------- ----------- ------------ ------------
Income before
income tax
expense 60,261 2,012,130 2,905,736 5,461,254
Income tax
expense (99,421) 588,090 638,915 1,572,034
----------- ----------- ------------ ------------
Net income $ 159,682 $ 1,424,040 $ 2,266,821 $ 3,889,220
=========== =========== ============ ============
Earnings per
common share:
Basic $ 0.03 $ 0.29 $ 0.46 $ 0.79
=========== =========== ============ ============
Diluted $ 0.03 $ 0.29 $ 0.46 $ 0.79
=========== =========== ============ ============
RURBAN FINANCIAL CORP.
CONSOLIDATED FINANCIAL
HIGHLIGHTS
(Unaudited)
---------------------- ------------------------------------------
Three Months Ended Nine Months Ended
(dollars in thousands September 30, September 30,
except per share data) -------------------- --------------------
2009 2008 2009 2008
---------------------- --------- --------- --------- ---------
EARNINGS
Net interest income $ 5,337 $ 4,448 $ 15,714 $ 12,698
Provision for loan
loss $ 898 $ 146 $ 2,192 $ 551
Non-interest income $ 7,076 $ 6,989 $ 22,421 $ 21,305
Revenue (net interest
income plus
non-interest income) $ 12,413 $ 11,437 $ 38,135 $ 34,003
Non-interest expense $ 11,454 $ 9,279 $ 33,037 $ 27,991
Net income $ 160 $ 1,424 $ 2,267 $ 3,889
PER SHARE DATA
Basic earnings per
share $ 0.03 $ 0.29 $ 0.46 $ 0.79
Diluted earnings
per share $ 0.03 $ 0.29 $ 0.46 $ 0.79
Book value per share $ 13.30 $ 12.25 $ 13.30 $ 12.25
Tangible book value
per share $ 7.39 $ 8.65 $ 7.39 $ 8.65
Cash dividend per
share $ 0.09 $ 0.09 $ 0.27 $ 0.25
PERFORMANCE RATIOS
Return on average
assets 0.10% 0.99% 0.46% 0.90%
Return on average
equity 1.00% 9.54% 4.75% 8.69%
Net interest margin
(tax equivalent) 3.87% 3.56% 3.79% 3.42%
Net interest margin
- banking group 4.06% 3.84% 4.00% 3.71%
Non-interest expense/
Average assets 6.88% 6.44% 6.63% 6.50%
Efficiency Ratio -
bank (non-GAAP) 75.80% 71.13% 75.22% 72.25%
MARKET DATA PER SHARE
Market value per
share --
Period end $ 7.58 $ 9.00 $ 7.58 $ 9.00
Market as a % of book 57% 73% 57% 73%
Cash dividend yield 4.75% 4.00% 4.75% 3.70%
Period-end common
shares outstanding
(000) 4,862 4,906 4,862 4,906
Common stock market
capitalization
($000) $ 36,852 $ 44,154 $ 36,852 $ 44,154
CAPITAL & LIQUIDITY
Equity to assets 9.6% 10.3% 9.6% 10.3%
Period-end tangible
equity to tangible
assets 5.6% 7.5% 5.5% 7.5%
Total risk-based
capital ratio
(Estimate) 13.3% 16.5% 13.3% 16.5%
ASSET QUALITY
Net charge-offs /
(Recoveries) $ 837 $ 336 $ 1,279 $ 485
Net loan charge-offs
(Ann.) / Average
loans 0.73% 0.33% 0.38% 0.16%
Non-performing loans $ 9,646 $ 4,659 $ 9,646 $ 4,659
OREO / OAOs $ 1,748 $ 1,611 $ 1,748 $ 1,611
Non-performing
assets $ 11,394 $ 6,270 $ 11,394 $ 6,270
Non-performing
assets / Total
assets 1.69% 1.07% 1.69% 1.07%
Allowance for loan
losses / Total
loans 1.32% 1.01% 1.32% 1.01%
Allowance for loan
losses / Non-
performing Assets 52.1% 64.7% 52.1% 64.7%
END OF PERIOD BALANCES
Total loans, net of
unearned income $ 448,393 $ 399,910 $ 448,393 $ 399,910
Allowance for loan
loss $ 5,934 $ 4,057 $ 5,934 $ 4,057
Total assets $ 673,749 $ 585,022 $ 673,749 $ 585,022
Deposits $ 492,292 $ 406,454 $ 492,292 $ 406,454
Stockholders' equity $ 64,668 $ 60,117 $ 64,668 $ 60,117
Full-time equivalent
employees 321 271 321 271
AVERAGE BALANCES
Loans $ 456,196 $ 401,790 $ 450,119 $ 398,808
Total earning assets $ 569,099 $ 506,760 $ 567,621 $ 505,297
Total assets $ 665,872 $ 576,774 $ 664,280 $ 574,439
Deposits $ 483,637 $ 403,064 $ 486,206 $ 409,242
Stockholders' equity $ 64,238 $ 59,717 $ 63,596 $ 59,690
RURBAN FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
------------------ -------- -------- -------- -------- --------
(dollars in
thousands except 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr 3rd Qtr
per share data) 2009 2009 2009 2008 2008
------------------ -------- -------- -------- -------- --------
EARNINGS
Net interest
income $ 5,337 $ 5,361 $ 5,016 $ 4,830 $ 4,448
Provision for
loan loss $ 898 $ 799 $ 495 $ 138 $ 146
Non-interest
income $ 7,076 $ 7,897 $ 7,448 $ 6,755 $ 6,989
Revenue (net
interest
income plus
non-interest
income) $ 12,413 $ 13,258 $ 12,464 $ 11,585 $ 11,437
Non-interest
expense $ 11,454 $ 11,108 $ 10,475 $ 9,566 $ 9,279
Net income $ 160 $ 1,003 $ 1,104 $ 1,328 $ 1,424
PER SHARE DATA
Basic earnings
per share $ 0.03 $ 0.20 $ 0.23 $ 0.27 $ 0.29
Diluted earnings
per share $ 0.03 $ 0.20 $ 0.23 $ 0.27 $ 0.29
Book value per
share $ 13.30 $ 13.04 $ 13.06 $ 12.63 $ 12.25
Tangible book
value per
share $ 7.39 $ 7.24 $ 7.24 $ 7.06 $ 8.65
Cash dividend
per share $ 0.09 $ 0.09 $ 0.09 $ 0.09 $ 0.09
PERFORMANCE RATIOS
Return on
average assets 0.10% 0.61% 0.66% 0.88% 0.99%
Return on
average equity 1.00% 6.29% 7.04% 8.75% 9.54%
Net interest
margin (tax
equivalent) 3.87% 3.82% 3.67% 3.83% 3.56%
Net interest
margin (Bank
Only) 4.06% 4.04% 3.93% 4.06% 3.84%
Non-interest
expense /
Average assets 6.88% 6.71% 6.29% 6.31% 6.44%
Efficiency
Ratio - bank
(non-GAAP) 75.80% 72.67% 77.41% 73.15% 71.13%
MARKET DATA PER SHARE
Market value
per share --
Period end $ 7.58 $ 7.75 $ 7.90 $ 7.60 $ 9.00
Market as a %
of book 57% 59% 60% 60% 73%
Cash dividend
yield 4.75% 4.65% 4.56% 4.74% 4.00%
Period-end
common shares
outstanding
(000) 4,862 4,864 4,871 4,881 4,906
Common stock
market
capitalization
($000) $ 36,852 $ 37,696 $ 38,484 $ 37,099 $ 44,154
CAPITAL & LIQUIDITY
Equity to
assets 9.6% 9.6% 9.6% 9.4% 10.3%
Period-end
tangible
equity to
tangible
assets 5.6% 5.6% 5.5% 6.6% 7.5%
Total risk-based
capital ratio
(Estimate) 13.3% 13.7% 13.5% 13.0% 16.5%
ASSET QUALITY
Net charge-offs /
(Recoveries) $ 837 $ 275 $ 167 $ 280 $ 336
Net loan
charge-offs
(Ann.) /
Average loans 0.73% 0.25% 0.15% 0.27% 0.33%
Non-performing
loans $ 9,646 $ 10,173 $ 9,163 $ 5,178 $ 4,659
OREO / OAOs $ 1,748 $ 1,346 $ 1,426 $ 1,409 $ 1,611
Non-performing
assets $ 11,394 $ 11,519 $ 10,589 $ 6,587 $ 6,270
Non-performing
assets / Total
assets 1.69% 1.74% 1.59% 1.00% 1.07%
Allowance for
loan losses /
Total loans 1.32% 1.33% 1.23% 1.12% 1.01%
Allowance for
loan losses /
Non-performing
Assets 52.1% 51.0% 50.5% 76.2% 64.7%
END OF PERIOD
BALANCES
Total loans,
net of
unearned
income $448,393 $441,217 $434,052 $450,112 $399,910
Allowance for
loan loss $ 5,934 $ 5,873 $ 5,349 $ 5,020 $ 4,057
Total assets $673,749 $661,545 $665,813 $657,619 $585,022
Deposits $492,292 $472,994 $487,634 $484,221 $406,454
Stockholders'
equity $ 64,668 $ 63,413 $ 63,621 $ 61,662 $ 60,117
Full-time
equivalent
employees 321 309 306 306 271
AVERAGE BALANCES
Loans $456,196 $448,677 $448,271 $412,222 $401,790
Total earning
assets $569,099 $575,240 $561,566 $518,707 $506,760
Total assets $665,872 $662,589 $666,292 $606,655 $576,774
Deposits $483,637 $483,882 $490,526 $431,076 $403,064
Stockholders'
equity $ 64,238 $ 63,823 $ 62,692 $ 60,686 $ 59,717
Rurban Financial Corp.
Segment Reporting
Third Quarter Ended September 30, 2009
($ in Thousands)
--------------------------------------------------
Parent
Company Rurban
Income Statement Total Data and Elimination Financial
Measures Banking Processing Other Entries Corp.
---------------- --------------------------------------------------
Interest Income $ 8,187 $ 41 $ 1 $ (43) $ 8,186
Interest
Expense 2,417 84 391 (43) 2,849
Net Interest
Income 5,770 (43) (390) -- 5,337
Provision For
Loan Loss 898 -- -- -- 898
Non-interest
Income 2,273 5,202 409 (808) 7,076
Non-interest
Expense 6,257 5,145 860 (808) 11,454
Net Income
QTD $ 712 $ 8 $ (560) $ -- $ 160
Performance
Measures
-----------
Average
Assets -
QTD $644,116 $ 22,770 $ 86,418 $(87,432) $665,872
ROAA 0.44% 0.14% -- -- 0.10%
Average Equity
- QTD $ 68,153 $ 14,723 $ 64,238 $(82,877) $ 64,238
ROAE 4.18% 0.22% -- -- 1.00%
Efficiency
Ratio - % 75.80% -- -- -- 90.55%
Average Loans
- QTD $456,195 $ 3,000 $ -- $ (3,000) $456,196
Average
Deposits -
QTD $485,192 $ -- $ -- $ (1,555) $483,637
Rurban Financial Corp.
Segment Reporting
Nine Months Ended September 30, 2009
($ in Thousands)
--------------------------------------------------
Parent
Company Rurban
Income Statement Total Data and Elimination Financial
Measures Banking Processing Other Entries Corp.
---------------- --------------------------------------------------
Interest Income $ 24,637 $ 71 $ 1 $ (86) $ 24,623
Interest
Expense 7,637 173 1,185 (86) 8,909
Net Interest
Income 17,000 (102) (1,184) -- 15,714
Provision For
Loan Loss 2,192 -- -- -- 2,192
Non-interest
Income 7,716 15,925 1,185 (2,405) 22,421
Non-interest
Expense 19,071 13,724 2,647 (2,405) 33,037
Net Income
YTD $ 2,622 $ 1,384 $ (1,739) $ -- $ 2,267
Performance
Measures
-----------
Average
Assets -
YTD $643,819 $ 21,849 $ 85,982 $(87,371) $664,280
ROAA 0.54% 8.45% -- -- 0.46%
Average
Equity -
YTD $ 67,487 $ 14,654 $ 63,596 $(82,142) $ 63,596
ROAE 5.18% 12.59% -- -- 4.75%
Efficiency
Ratio - % 75.22% -- -- -- 84.91%
Average
Loans -
YTD $451,764 $ 1,773 $ -- $ (3,417) $450,119
Average
Deposits
- YTD $488,018 $ -- $ -- $ (1,812) $486,206
Rurban Financial Corp.
Proforma Performance Measurement
Quarterly Comparison - Third Quarter 2009
($ in Thousands)
-------------------------------------------------------
Parent Rurban
Total Data Company Elimination Financial
Banking Processing and Other Entries Corp.
-------------------------------------------------------
Revenue
-------
3Q09 $ 8,043 $ 5,159 $ 19 $ (808) $ 12,413
2Q09 $ 8,731 $ 5,316 $ (19) $ (770) $ 13,258
1Q09 $ 7,942 $ 5,348 $ 1 $ (827) $ 12,464
4Q08 $ 7,007 $ 5,381 $ (18) $ (785) $ 11,585
3Q08 $ 6,877 $ 5,294 $ 5 $ (738) $ 11,438
3rd Quarter
Comparison $ 1,166 $ (135) $ 14 $ -- $ 975
Non-interest
Expenses
------------
3Q09 $ 6,257 $ 5,145 $ 860 $ (808) $ 11,454
2Q09 $ 6,505 $ 4,394 $ 979 $ (770) $ 11,108
1Q09 $ 6,309 $ 4,185 $ 808 $ (827) $ 10,475
4Q08 $ 5,254 $ 4,299 $ 798 $ (785) $ 9,566
3Q08 $ 5,003 $ 4,286 $ 728 $ (738) $ 9,279
3rd Quarter
Comparison $ 1,254 $ 859 $ 132 $ -- $ 2,175
Net Income
----------
3Q09 $ 712 $ 8 $ (560) $ -- $ 160
2Q09 $ 1,048 $ 608 $ (653) $ -- $ 1,003
1Q09 $ 863 $ 768 $ (527) $ -- $ 1,104
4Q08 $ 1,146 $ 715 $ (533) $ -- $ 1,328
3Q08 $ 1,233 $ 664 $ (473) $ -- $ 1,424
3rd Quarter
Comparison $ (521) $ (656) $ (87) $ -- $ (1,264)
Average Assets
--------------
3Q09 $644,116 $ 22,770 $ 86,418 $ (87,432) $665,872
2Q09 $641,939 $ 22,166 $ 86,005 $ (87,521) $662,589
1Q09 $645,365 $ 20,256 $ 85,313 $ (84,642) $666,292
4Q08 $596,469 $ 19,804 $ 82,775 $ (92,393) $606,655
3Q08 $557,306 $ 20,344 $ 81,707 $ (82,583) $576,774
3rd Quarter
Comparison $ 86,810 $ 2,426 $ 4,711 $ -- $ 89,098
ROAA
----
3Q09 0.44% 0.14% -- -- 0.10%
2Q09 0.65% 10.97% -- -- 0.61%
1Q09 0.53% 15.17% -- -- 0.66%
4Q08 0.77% 14.44% -- -- 0.88%
3Q08 0.88% 13.06% -- -- 0.99%
3rd Quarter
Comparison (0.44%) (12.92%) -- -- (0.89%)
Average Equity
--------------
3Q09 $ 68,153 $ 14,723 $ 64,238 $ (82,877) $ 64,238
2Q09 $ 67,760 $ 14,674 $ 63,823 $ (82,434) $ 63,823
1Q09 $ 66,532 $ 14,529 $ 62,692 $ (81,061) $ 62,692
4Q08 $ 63,224 $ 15,816 $ 60,686 $ (79,040) $ 60,686
3Q08 $ 59,899 $ 16,063 $ 59,717 $ (75,962) $ 59,717
3rd Quarter
Comparison $ 8,254 $ (1,340) $ 4,521 -- $ 4,521
ROAE
----
3Q09 4.18% 0.22% -- -- 1.00%
2Q09 6.19% 16.57% -- -- 6.29%
1Q09 5.19% 21.14% -- -- 7.04%
4Q08 7.25% 18.08% -- -- 8.75%
3Q08 8.23% 16.53% -- -- 9.54%
3rd Quarter
Comparison (4.05%) (16.31%) -- -- (8.54%)
Efficiency
Ratio
----------
3Q09 75.56% 98.67% -- -- 90.55%
2Q09 72.67% 81.49% -- -- 82.11%
1Q09 77.41% 77.48% -- -- 82.24%
4Q08 73.15% 73.15% -- -- 80.92%
3Q08 71.13% 79.79% -- -- 79.60%
3rd Quarter
Comparison 4.43% 18.88% -- -- 10.95%