MACON, Ga., April 29, 2008 (PRIME NEWSWIRE) -- Security Bank Corporation (Nasdaq:SBKC) today reported a net loss of $24.2 million for the first quarter ended March 31, 2008, versus net income of $6.8 million for the first quarter of 2007. Diluted earnings per share for the first quarter of 2008 were a loss of $1.22 compared to earnings of $0.35 per share for the comparable year ago period. The decrease in diluted earnings per share for the first quarter of 2008 is primarily attributable to a $41 million increase in provision for loan losses versus the first quarter a year ago. This increased provision has added over $18 million to Security Bank's allowance for loan losses on a consecutive quarterly basis.
Security Bank's tangible book value decreased 18% to $7.72 per share at March 31, 2008 versus $9.39 a year ago. Tangible equity to tangible assets was 6.7% at March 31, 2008 versus 7.5% on March 31, 2007, and all bank subsidiaries were "well-capitalized" as defined by regulatory standards at the end of the first quarter of 2008. On a pro forma basis, adjusting for the just completed $40 million debt issuance, total risk-based capital is 12.2%, with $50 million in excess capital over the 10% minimum "well-capitalized" level.
Rett Walker, Security Bank Corporation President and CEO, remarked, "We are very disappointed with our first quarter results, which significantly lag Security Bank's historical performance. But, we are confident that in this challenging environment, we are taking the appropriate steps to shore up capital and return ourselves to profitability. The precipitous decline in housing market conditions has caused us to increase our reserves, raise capital and reduce our dividend. Reducing the dividend was a difficult decision since it adversely affects our shareholders. However, we believe the long-term benefit to our shareholders of fortifying our balance sheet during these difficult times outweighs the disadvantage of the dividend reduction. To ensure that our banks remain 'well-capitalized,' we have proactively raised over $68 million of capital in 2008 to deal with the unprecedented credit market conditions, especially in the Atlanta residential real estate construction and development market. Consistent with our prior history, we have been early to identify problem credits, take appropriate action to charge off or write down these credits, all while substantially increasing our allowance for loan losses to 2.3% of loans. We recognize that 2008 will be a difficult year for us and the entire banking industry, and expect that our charge-offs, based on current elevated NPA levels, could more than double 2007 levels. But we remain confident that our focus on exceptional customer service, our leading market position in the stable Middle Georgia market, and the opportunity to participate in the recovery of the Atlanta market will restore long term shareholder value."
Asset Quality
During the first quarter, nonperforming assets ("NPAs" or nonaccrual loans and other real estate owned) increased to $222 million, or 10.0% of total loans plus other real estate owned compared to 3.6% and 2.1% at the end of the fourth quarter of 2007 and the first quarter of 2007, respectively. While the Company did sell $7 million of NPAs during the quarter, new properties totaling approximately $14 million were moved to other real estate owned and approximately $174 million of loans were placed on nonaccrual status. In addition, the Company charged off approximately $24 million (net) in loans receivable resulting in net charge-offs to average loans of 4.41% annualized for the first quarter of 2008. Net charge-offs to average loans were 0.05% annualized for the first quarter of 2007. Security Bank increased its allowance for loan losses to $49.7 million, or 2.28% of loans receivable at March 31, 2008, up from $23.3 million at March 31, 2007.
Balance Sheet
Loans receivable were $2.2 billion at March 31, 2008, up from $2.0 billion at March 31, 2007, an increase of 8%. On a sequential basis loans were unchanged with growth in our Middle and Coastal Georgia markets, offsetting declines in the Atlanta market.
Total deposits were $2.3 billion at March 31, 2008, an increase of 14% from $2.0 billion at March 31, 2007. Total assets increased 11% to $2.8 billion at March 31, 2008, compared to $2.5 billion at March 31, 2007.
Shareholders' equity at March 31, 2008 declined by roughly $2 million to $309.9 million compared to March 31, 2007, as losses, net of dividends paid, were mostly offset by capital raised in a rights offering in the first quarter of 2008, net of reduced equity as a result of shares purchased during 2007 under a share repurchase program.
Net Interest Income
Net interest income for the first quarter of 2008 was $14.8 million, a decrease of 35% when compared to the first quarter of 2007. The decrease is primarily the result of slower growth in the Company's loan portfolio in addition to a decline in net interest margin. The net interest margin (on a fully tax-equivalent basis ("FTE")) was 2.33% for the quarter ended March 31, 2008, compared to 4.22% for the comparable period one year ago and 3.46% for the fourth quarter of 2007. The decrease in the net interest margin in the first quarter of 2008 as compared to the fourth quarter of 2007 is the result of the aforementioned increase in nonperforming assets and associated reversals of interest income, as well as the effect of the decline in short-term rates in the first quarter of 2008.
Noninterest Income and Expense
Noninterest income for the first quarter of 2008 increased 15% to $5.9 million compared to the first quarter of 2007 due to a $2 million gain on sales of securities, which was partially offset by an increase in the loss on sale of OREO.
Noninterest expense for the first quarter of 2008 was $16.9 million, an increase of $l.0 million, or 6% over the first quarter 2007 level of $15.9 million. The increase is primarily attributable to a $1.4 million increase in foreclosure expenses from higher levels of nonperforming assets and an increase in FDIC premiums of $0.3 million that was partially offset by reduced salary and benefit expense of $0.8 million due to lower incentive compensation being paid to our employees.
Other Information
Security Bank Corporation management will host a conference call to discuss these results at 11:00 AM Eastern Daylight Savings Time on Tuesday, April 29, 2008. This call is open to all interested parties. From locations within the United States the call-in number is 800.860.2442 (412.858.4600 from outside the United States). Please call in 10 minutes prior to the beginning of the conference call and ask for Security Bank Corporation.
A recorded playback of the conference call will be available for one week by calling 877.344.7529, or 412.317.0088 from outside the United States. The passcode for this playback is 415163#.
This press release, including the attached selected unaudited financial tables, which are a part of this release, contains financial information determined by methods other than in accordance with generally accepted accounting principles ("GAAP"). These non-GAAP financial measures are "tangible book value," "tangible equity to tangible assets" and "return on average tangible equity." Security Bank's management uses these non-GAAP measures in its analysis of Security Bank's performance.
Tangible book value is defined as total equity reduced by recorded intangible assets, net of related deferred tax benefits. Tangible book value per share is defined as tangible book value divided by total common shares outstanding. This measure is important to many investors in the marketplace who are interested in changes from period to period in book value per share exclusive of changes in intangible assets. Goodwill, an intangible asset that is recorded in a purchase business combination, has the effect of increasing total book value while not increasing the tangible assets of the company. For companies such as Security Bank that have engaged in multiple business combinations, purchase accounting requires the recording of significant amounts of goodwill related to such transactions. Tangible equity to tangible assets is the ratio of tangible equity defined as total equity reduced by recorded intangible assets, net of related deferred tax benefits, to tangible assets defined as total assets reduced by recorded intangible assets, net of related deferred tax benefits. Tangible equity to tangible assets is an important measure of the Company's capital strength without the effects of purchase accounting as noted above. Return on average tangible equity is defined as earnings for the period (annualized for the quarterly period or year-to-date period, as applicable) divided by average equity reduced by average goodwill and other intangible assets, net of related deferred tax benefits. Security Bank's management includes this measure because it believes that it is important when measuring the Company's performance exclusive of the effects of goodwill and other intangibles recorded in recent acquisitions, and many investors use this measure as part of their analysis of Security Bank.
These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Please refer to the "Reconciliation Table" in the attached schedules for a more detailed analysis of these non-GAAP measures and the most directly comparable GAAP measures.
About Security Bank Corporation
Based in Macon, Georgia, Security Bank Corporation is a multi-bank holding company with assets of $2.8 billion at March 31, 2007. Security Bank Corporation operates 6 community banks with banking offices located throughout middle Georgia, coastal Georgia and north metropolitan Atlanta. In addition, Security Bank Corporation operates an interim real estate and development lender and traditional mortgage originator, Fairfield Financial Services, Inc., with offices throughout Georgia.
Security Bank Corporation common stock is traded on the NASDAQ Global Select Market under the ticker symbol "SBKC." You may obtain copies of all documents that Security Bank files with the Securities and Exchange Commission, free of charge, at the SEC's website at www.sec.gov. In addition, copies of these documents may also be obtained from us without charge by directing a written request to Security Bank Corporation, 4219 Forsyth Road, Macon, Georgia 31210, attention: Investor Relations.
Safe Harbor
This press release contains forward-looking statements as defined by federal securities laws, including statements about Security Bank's loan loss provisions, capital adequacy, dividend reductions, net charge-offs, non-performing assets net interest margin changes, the overall economic cycle and its impact on real estate values in Security Bank's markets, loan growth, introduction and success of new products and Security Bank's long-term prospects, among others. Statements contained in this press release that are not historical facts are forward-looking statements. Forward-looking statements may address issues involving significant risks, uncertainties, estimates and assumptions made by management. Security Bank's ability to accurately project results or predict the effects of future plans or strategies is inherently limited. Although Security Bank believes that the expectations and estimates reflected in its forward-looking statements are based on reasonable assumptions, actual results and performance could differ materially from those set forth in the forward-looking statements. Please refer to Security Bank Corporation's public filings with the Securities and Exchange Commission for a summary of important factors that could affect Security Bank Corporation's financial results and operations and its forward-looking statements. Security Bank Corporation does not intend to and assumes no responsibility, except as required by law, for updating or revising any forward-looking statements contained in this press release, whether as a result of new information, changes in assumptions, future events or otherwise.
Security Bank Corporation
Selected Consolidated Financial Data
(Dollars in Thousands, except Per Share Amounts)
Unaudited
Quarters Ended
March 31,
2008 2007 % Change
---- ---- --------
EARNINGS SUMMARY:
Net interest income $ 14,799 $ 22,777 -35.0%
Provision for Loan Losses 42,199 1,260 3249.1%
Noninterest Income 5,862 5,092 15.1%
Noninterest Expense 16,907 15,888 6.4%
Income Taxes (14,247) 3,935 -462.1%
Net Income (Loss) (24,198) 6,786 -456.6%
PER COMMON SHARE:
Basic earnings (loss) $ (1.22) $ 0.35 -448.6%
Diluted earnings (loss) (1.22) 0.35 -448.6%
Cash dividends declared 0.088 0.088 0.0%
Book value 13.34 16.25 -17.9%
Tangible book value 7.72 9.39 -17.8%
KEY PERFORMANCE RATIOS (a):
Return on average
tangible equity (b) -13.25% 15.78%
Return on average assets -0.86% 1.13%
Efficiency ratio 81.83% 57.01%
Net interest margin (FTE) 2.33% 4.22%
Net charge-offs to average loans 4.41% 0.05%
BALANCE SHEET SUMMARY
- END OF PERIOD
Investment securities $ 306,018 $ 191,945 59.4%
Loans Held for Resale 5,759 8,341 -31.0%
Loans, gross 2,181,557 2,016,997 8.2%
Allowance for loan losses 49,749 23,336 113.2%
Total assets 2,818,477 2,541,603 10.9%
Deposits 2,309,671 2,019,089 14.4%
Other borrowed money 170,066 188,953 -10.0%
Shareholders' equity 309,876 311,729 -0.6%
Tangible equity to
tangible assets 6.67% 7.48% -10.8%
ASSET QUALITY - END OF PERIOD
Nonaccrual loans $ 186,520 $ 39,139 376.6%
Loans 90 Days Past Due
and Accruing 68 -- 100.0%
Other real estate owned 35,749 3,403 950.5%
Total nonperforming assets 222,337 42,542 422.6%
Allowance for loan losses/NPA's 22.38% 54.85%
Allowance for loan losses/loans 2.28% 1.16%
(a) Annualized based on number of days in the period, except
efficiency ratio
(b) Calculation of this measure is illustrated in the attached GAAP
to non-GAAP reconciliation
Security Bank Corporation
Average Balance Sheet and Net Interest Income Analysis
(Dollars in Thousands)
Unaudited
Quarter Ended
March 31, 2008
Average Income/ Yield/
Balance Expense Rate
------- ------- ----
ASSETS
Earning assets:
Interest-bearing deposits
and fed funds sold $ 54,008 $ 424 3.15%
Investment securities 296,395 3,319 4.49%
Loans Held for Resale 5,896 92 6.26%
Loans 2,194,092 36,935 6.75%
Other earning assets 1,238 22 7.13%
Total earning assets 2,551,629 40,792 6.41%
Non-earning assets 266,993
-----------
Total assets $2,818,622
===========
LIABILITIES AND
SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Savings and interest-bearing
transaction $ 508,552 $ 3,574 2.82%
Time deposits 1,637,728 20,370 4.99%
Other borrowings 175,124 1,999 4.58%
Total interest-bearing
liabilities 2,321,404 25,943 4.48%
Noninterest-bearing liabilities:
Noninterest bearing deposits 155,389
Other noninterest-bearing
liabilities 28,194
Total liabilities $2,504,987
-----------
Shareholders' Equity 313,635
-----------
Total liabilities and
shareholders' equity $2,818,622
===========
Interest rate spread 1.93%
Net interest income $ 14,849
Net interest margin (FTE) 2.33%
Security Bank Corporation (SBKC)
Selected Financial Information
(Amounts in thousands, except per share data)
2008
------------
1st Quarter
------------
Period-End Balance Sheet
------------------------
Total Assets $ 2,818,477
Total Securities 306,018
Mortgage Loans held for Sale 5,759
Loans:
Commercial:
Real-Estate (4) 963,384
Construction/A&D (4) 825,553
All Other 172,200
Personal:
Real-Estate 157,040
Construction/A&D 24,679
All Other 38,701
Total Loans 2,181,557
Allowance for loan losses 49,749
Other Assets:
Other earning assets: 26,704
Total Earning Assets: 2,520,038
Intangibles:
Goodwill 128,074
Core-Deposit 3,879
Deposits:
Demand Deposits 164,842
Interest bearing deposits 2,144,829
Total Deposits 2,309,671
Fed Funds purchased
& repo agreements 31,328
Other borrowed funds 138,738
Common Equity 309,876
===============================================================
Average Balance Sheet
---------------------
Total Assets $ 2,818,622
Total Securities 296,395
Mortgage Loans held for Sale 5,896
Loans:
Commercial:
Real-Estate 958,903
Construction/A&D 850,060
Other 156,231
Personal:
Real-Estate 158,069
Construction/A&D 25,071
Other 45,758
Total Loans 2,194,092
Other Assets:
Other earning assets: 55,246
Total Earning Assets: 2,551,629
Deposits:
Demand Deposits 155,389
Interest bearing deposits
Savings 14,979
NOW 382,597
Money Market 110,976
Time deposits greater than $100,000 1,061,895
Time deposits less than $100,000 575,833
Total Deposits 2,301,669
Fed Funds purchased
& repo agreements 44,745
Other borrowed funds 130,379
Common Equity 313,635
===============================================================
Income Statement
----------------
Interest Income $ 40,742
Interest Expense 25,943
Net Interest Income 14,799
Loan loss provision 42,199
Service charges on deposit accounts 2,287
Mortgage banking revenues 1,002
Securities Gains (Losses) 2,034
Other income 539
Total noninterest income 5,862
Salaries and benefits 8,736
Occupancy and equipment 1,549
Foreclosed Property 1,600
Other noninterest expense 5,022
Total noninterest expense 16,907
Pre-tax earnings (loss) (38,445)
Income Taxes (14,247)
Net income (loss) $ (24,198)
Basic earnings (loss) per share $ (1.22)
Diluted earnings (loss) per share (1.22)
Operating diluted earnings (loss) per share (3) (1.28)
End of period shares outstanding 23,233,634
Weighted average diluted shares o/s 19,810,520
Tax equivalent adjustment 50
Net interest income (FTE) 14,849
Effective Tax Rate 37.06%
===============================================================
Stock and related per share data:
---------------------------------
Book value $ 13.34
Tangible book value 7.72
Dividends declared per share 0.0875
===============================================================
Other Key Ratios/Data:
----------------------
Return on average tangible equity (2), (3) -13.25%
Return on average assets (2) -0.86%
Net interest margin (FTE) (2) 2.33%
Efficiency ratio (FTE) 81.63%
Tangible Equity/Tangible Assets (3) 6.67%
===============================================================
Loan Performance Data:
----------------------
Nonaccrual loans $ 186,520
Loans 90 Days Past Due and Accruing 68
Other real estate owned (ORE) 35,749
Total nonperforming assets 222,337
Net charge-offs 24,148
Allowance for loan losses/NPA's 22.38%
Allowance for loan losses/loans 2.28%
NPA's/Loans plus ORE 10.03%
Nonperforming assets/total assets 7.89%
Net charge-offs to average loans (1) 4.41%
===============================================================
2007
------------------------------------------------------------
Dec. 31/YTD 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter
------------------------------------------------------------
Period-
End
Balance
Sheet
---------
Total
Assets $ 2,833,071 $ 2,833,071 $ 2,723,986 $ 2,672,177 $ 2,541,603
Total
Securi-
ties 305,399 305,399 227,694 219,185 191,945
Mortgage
Loans
held for
Sale 7,605 7,605 8,867 9,052 8,341
Loans:
Commercial:
Real-
Estate
(4) 959,671 959,671 900,969 843,477 932,971
Construc-
tion
/A&D (4) 861,013 861,013 896,563 892,315 703,703
All
Other 135,585 135,585 141,656 134,031 154,406
Personal:
Real-
Estate 158,244 158,244 155,508 152,726 152,217
Construc-
tion
/A&D 25,377 25,377 24,758 28,329 28,470
All
Other 42,423 42,423 45,758 43,376 45,230
Total
Loans 2,182,313 2,182,313 2,165,212 2,094,254 2,016,997
Allowance
for loan
losses 31,698 31,698 27,132 24,108 23,336
Other
Assets:
Other
earning
assets: 14,866 14,866 59,968 84,060 78,319
Total
Earning
Assets: 2,510,183 2,510,183 2,461,741 2,406,551 2,295,602
Intangibles:
Goodwill 128,571 128,571 128,571 128,601 128,553
Core-
Deposit 4,125 4,125 4,371 4,617 4,863
Deposits:
Demand
Deposits 158,759 158,759 161,749 171,427 176,658
Interest
bearing
deposits 2,139,946 2,139,946 2,029,351 1,989,651 1,842,431
Total
Depos-
its 2,298,705 2,298,705 2,191,100 2,161,078 2,019,089
Fed Funds
purchased
& repo
agreements 68,417 68,417 81,995 58,985 59,065
Other
borrowed
funds 137,910 137,910 121,388 118,888 129,888
Common
Equity 306,693 306,693 312,036 314,687 311,729
=====================================================================
Average
Balance
Sheet
--------
Total
Assets $ 2,591,947 $ 2,745,087 $ 2,648,300 $ 2,529,142 $ 2,441,326
Total
Securities 216,610 256,061 220,379 195,031 194,248
Mortgage
Loans held
for Sale 6,328 5,647 6,367 8,728 4,557
Loans:
Commercial:
Real-
Estate 907,729 939,330 863,915 890,191 937,948
Construc-
tion
/A&D 797,692 886,581 892,021 781,274 627,003
Other 148,064 142,903 140,395 152,784 156,406
Personal:
Real-
Estate 153,682 156,468 154,652 152,519 151,018
Construc-
tion
/A&D 27,610 26,112 26,307 28,848 29,134
Other 47,222 46,677 46,322 46,657 49,355
Total
Loans 2,081,999 2,198,071 2,123,612 2,052,273 1,950,864
Other
Assets:
Other
earning
assets: 36,866 28,184 33,016 34,280 52,292
Total
Earning
Assets: 2,341,803 2,487,963 2,383,374 2,290,312 2,201,961
Deposits:
Demand
Deposits 163,712 159,891 161,225 168,589 165,255
Interest
bearing
deposits
Savings 16,005 15,104 15,513 16,810 16,612
NOW 373,522 373,274 377,448 375,605 367,657
Money
Market 145,619 147,908 151,428 144,907 138,060
Time
deposits
greater
than
$100,000 892,248 1,003,681 949,323 833,758 779,136
Time
deposits
less
than
$100,000 521,923 531,107 523,421 516,844 516,137
Total
Depos-
its 2,113,029 2,230,965 2,178,358 2,056,513 1,982,857
Fed Funds
purchased &
repo
agreements 43,881 55,528 41,945 43,682 34,158
Other
borrowed
funds 100,430 125,342 92,383 92,277 91,436
Common
Equity 313,504 315,791 316,060 313,877 308,691
=====================================================================
Income
Statement
----------
Interest
Income $ 192,840 48,989 49,643 48,175 46,033
Interest
Expense 102,316 27,406 26,862 24,792 23,256
Net
Interest
Income 90,524 21,583 22,781 23,383 22,777
Loan loss
provision 32,660 20,000 9,400 2,000 1,260
Service
charges on
deposit
accounts 9,363 2,533 2,356 2,376 2,098
Mortgage
banking
revenues 4,475 995 1,170 1,271 1,039
Securities
Gains
(Losses) (3) -- (5) -- 2
Other
income 5,146 1,011 1,079 1,103 1,953
Total
noninterest
income 18,981 4,539 4,600 4,750 5,092
Salaries
and
benefits 35,061 7,564 8,852 9,094 9,551
Occupancy
and
equipment 6,189 1,595 1,559 1,547 1,488
Foreclosed
Property 4,823 2,774 1,153 710 186
Other
noninterest
expense 21,001 5,650 5,495 5,193 4,663
Total
noninterest
expense 67,074 17,583 17,059 16,544 15,888
Pre-tax
earnings
(loss) 9,771 (11,461) 922 9,589 10,721
Income
Taxes 3,183 (4,588) 347 3,489 3,935
Net
income
(loss) $ 6,588 (6,873) 575 6,100 6,786
Basic
earnings
(loss)
per
share $ 0.35 (0.36) 0.03 0.32 0.35
Diluted
earnings
(loss)
per
share 0.34 (0.36) 0.03 0.31 0.35
Operating
diluted
earnings
(loss) per
share (3) 0.34 (0.36) 0.03 0.31 0.35
End of
period
shares
outstand-
ing 18,912,264 18,912,264 18,889,227 19,212,139 19,181,241
Weighted
average
diluted
shares
o/s 19,225,069 18,958,448 19,184,272 19,463,979 19,456,857
Tax
equivalent
adjustment 445 112 110 112 111
Net
interest
income
(FTE) 90,969 21,695 22,891 23,495 22,888
Effective
Tax
Rate 32.58% 40.03% 37.64% 36.39% 36.70%
=====================================================================
Stock and
related
per
share
data:
---------
Book
value $ 16.22 16.22 16.52 16.38 16.25
Tangible
book
value 9.28 9.28 9.57 9.54 9.39
Dividends
declared
per
share 0.35 0.0875 0.0875 0.0875 0.0875
=====================================================================
Other Key
Ratios/
Data:
---------
Return on
average
tangible
equity (2),
(3) 3.63% -14.77% 1.24% 13.42% 15.78%
Return on
average
assets (2) 0.25% -0.99% 0.09% 0.97% 1.13%
Net interest
margin (FTE)
(2) 3.88% 3.46% 3.81% 4.11% 4.22%
Efficiency
ratio (FTE) 61.00% 67.02% 62.05% 58.57% 56.78%
Tangible
Equity/
Tangible
Assets (3) 6.50% 6.50% 6.97% 7.21% 7.48%
=====================================================================
Loan
Performance
Data:
------------
Nonaccrual
loans $ 50,635 50,635 41,492 35,450 39,139
Loans 90
Days
Past Due
and
Accruing 242 242 -- -- --
Other real
estate
owned
(ORE) 28,175 28,175 23,891 19,229 3,403
Total
nonper-
forming
assets 79,052 79,052 65,383 54,679 42,542
Net charge-
offs 23,298 15,434 6,376 1,228 260
Allowance
for
loan
losses/
NPA's 40.10% 40.10% 41.50% 44.09% 54.85%
Allowance
for
loan
losses/
loans 1.45% 1.45% 1.25% 1.15% 1.16%
NPA's/Loans
plus ORE 3.58% 3.58% 2.99% 2.59% 2.11%
Nonperform-
ing
assets/
total
assets 2.79% 2.79% 2.40% 2.05% 1.67%
Net charge-
offs to
average
loans (1) 1.12% 2.79% 1.19% 0.24% 0.05%
=====================================================================
2006
------------------------------------------------------------
Dec. 31/YTD 4th Quarter 3rd Quarter 2nd Quarter 1st Quarter
------------------------------------------------------------
Period
-End
Balance
Sheet
--------
Total
Assets $ 2,494,071 $ 2,494,071 $ 2,314,913 $ 1,974,376 $ 1,912,841
Total
Securi-
ties 229,940 229,940 211,005 163,378 146,932
Mortgage
Loans
held for
Sale 8,878 8,878 8,947 12,201 7,776
Loans:
Commercial:
Real-
Estate
(4) 916,919 916,919 884,417 705,072 699,215
Construc-
tion/
A&D
(4) 602,712 602,712 553,296 460,131 430,585
All
Other 152,289 152,289 125,468 115,968 103,396
Personal:
Real-
Estate 150,398 150,398 151,559 151,633 155,031
Construc-
tion/
A&D 30,262 30,262 30,332 32,057 30,376
All
Other 48,521 48,521 45,892 36,102 51,089
Total
Loans 1,901,101 1,901,101 1,790,964 1,500,963 1,469,692
Allowance
for loan
losses 22,336 22,336 21,477 18,190 17,812
Other
Assets:
Other
earning
assets: 97,808 97,808 49,612 82,265 78,567
Total
Earning
Assets: 2,237,727 2,237,727 2,060,528 1,758,807 1,702,967
Intangibles:
Goodwill 127,984 127,984 131,162 103,014 102,659
Core-
Deposit 5,110 5,110 5,356 4,907 5,129
Deposits:
Demand
Deposits 178,967 178,967 173,129 172,023 168,235
Interest
bearing
deposits 1,791,960 1,791,960 1,659,876 1,403,986 1,362,149
Total
Depos-
its 1,970,927 1,970,927 1,833,005 1,576,009 1,530,384
Fed Funds
purchased
& repo
agreements 50,917 50,917 35,819 20,030 18,271
Other
borrowed
funds 124,688 124,688 123,988 112,465 125,665
Common
Equity 306,408 306,408 302,273 257,780 217,641
=====================================================================
Average
Balance
Sheet
--------
Total
Assets $ 2,028,906 $ 2,368,642 $ 2,157,297 $ 1,906,800 $ 1,673,006
Total
Securities 173,665 216,433 183,291 151,542 142,473
Mortgage
Loans
held for
Sale 6,576 6,064 7,015 8,011 5,200
Loans:
Commercial:
Real-
Estate 760,925 894,885 818,912 701,309 624,990
Construc-
tion/
A&D 490,964 600,693 524,265 450,386 385,784
Other 116,591 136,109 122,750 109,873 93,284
Personal:
Real-
Estate 153,480 151,938 151,332 153,272 157,463
Construc-
tion/
A&D 27,767 29,520 30,658 30,279 20,480
Other 49,781 51,282 49,191 49,693 52,788
Total
Loans 1,599,508 1,864,427 1,697,108 1,494,812 1,334,789
Other
Assets:
Other
earning
assets: 35,756 37,051 39,313 45,829 20,624
Total
Earning
Assets: 1,815,505 2,123,975 1,926,727 1,700,194 1,503,086
Deposits:
Demand
Deposits 166,190 169,410 172,393 166,941 155,181
Interest
bearing
deposits
Savings 19,268 17,085 18,645 20,359 21,036
NOW 310,624 358,114 335,152 307,630 240,033
Money
Market 127,456 146,241 132,302 103,540 127,480
Time
deposits
greater
than
$100,000 571,992 688,977 608,483 542,530 445,970
Time
deposits
less
than
$100,000 423,708 506,804 471,973 386,389 325,379
Total
Depos-
its 1,619,238 1,886,631 1,738,948 1,527,389 1,315,079
Fed Funds
purchased
& repo
agreements 29,874 45,112 26,036 23,230 24,608
Other
borrowed
funds 108,997 108,338 89,927 102,493 136,740
Common
Equity 252,004 304,362 283,937 235,731 182,219
=====================================================================
Income
Statement
----------
Interest
Income $ 148,081 $ 44,415 $ 40,669 $ 34,214 $ 28,783
Interest
Expense 68,647 22,353 19,082 15,142 12,070
Net
Interest
Income 79,434 22,062 21,587 19,072 16,713
Loan loss
provision 4,468 1,873 1,226 739 630
Service
charges
on
deposit
accounts 9,162 2,336 2,387 2,335 2,104
Mortgage
banking
revenues 4,922 1,007 1,231 1,433 1,251
Securities
Gains
(Losses) (1,601) (1,331) (270) -- --
Other
income 5,472 1,063 1,681 1,169 1,559
Total
noninter-
est
income 17,955 3,075 5,029 4,937 4,914
Salaries
and
benefits 32,376 8,313 8,497 7,804 7,762
Occupancy
and
equipment 5,622 1,471 1,396 1,459 1,296
Foreclosed
Property 416 193 145 51 27
Other
noninter-
est
expense 17,237 4,687 4,437 4,320 3,793
Total
noninter-
est
expense 55,651 14,664 14,475 13,634 12,878
Pre-tax
earnings
(loss) 37,270 8,600 10,915 9,636 8,119
Income
Taxes 13,878 3,378 3,975 3,546 2,979
Net
income
(loss) $ 23,392 $ 5,222 $ 6,940 6,090 5,140
Basic
earnings
(loss)
per
share $ 1.36 $ 0.26 $ 0.38 $ 0.36 $ 0.36
Diluted
earnings
(loss)
per
share 1.33 0.26 0.37 0.36 0.35
Operating
diluted
earnings
(loss)
per
share
(3) 1.38 0.31 0.37 0.36 0.35
End of
period
shares
outstand-
ing 19,166,314 19,166,314 19,161,507 17,519,112 15,782,125
Weighted
average
diluted
shares
o/s 17,564,990 19,528,891 18,971,126 16,910,380 14,784,856
Tax
equivalent
adjustment 414 106 107 100 101
Net
interest
income
(FTE) 79,848 22,168 21,694 19,172 16,814
Effective
Tax Rate 37.24% 39.28% 36.42% 36.80% 36.69%
=====================================================================
Stock and
related
per
share
data:
---------
Book
value $ 15.99 $ 15.99 $ 15.78 14.71 13.79
Tangible
book
value 8.99 8.99 8.76 8.66 7.08
Dividends
declared
per
share 0.30 0.0750 0.0750 0.0750 0.0750
=====================================================================
Other Key
Ratios/
Data:
---------
Return on
average
tangible
equity
(2), (3) 16.53% 12.19% 17.13% 18.81% 19.92%
Return on
average
assets
(2) 1.15% 0.87% 1.28% 1.28% 1.25%
Net
interest
margin
(FTE)
(2) 4.40% 4.14% 4.47% 4.52% 4.54%
Efficiency
ratio
(FTE) 56.90% 58.09% 54.17% 56.55% 59.27%
Tangible
Equity/
Tangible
Assets
(3) 7.42% 7.42% 7.70% 8.12% 6.19%
=====================================================================
Loan
Perfor-
mance
Data:
---------
Nonaccrual
loans $ 34,401 $ 34,401 $ 16,946 $ 17,269 8,171
Loans 90
Days Past
Due and
Accruing -- -- -- --
Other real
estate
owned
(ORE) 2,775 2,775 1,867 1,817 2,488
Total
nonper-
forming
assets 37,176 37,176 18,813 19,086 10,659
Net charge
-offs 2,362 1,014 789 361 198
Allowance
for loan
losses/
NPA's 60.08% 60.08% 114.16% 95.31% 167.11%
Allowance
for loan
losses/
loans 1.18% 1.18% 1.20% 1.21% 1.21%
NPA's/
Loans
plus ORE 1.95% 1.95% 1.05% 1.27% 0.72%
Nonper-
forming
assets/
total
assets 1.49% 1.49% 0.81% 0.97% 0.56%
Net
charge-
offs to
average
loans
(1) 0.15% 0.22% 0.18% 0.10% 0.06%
=====================================================================
(1) Annualized
(2) The actual number of days in the period were used to annualize
income
(3) Calculation of this measure is illustrated in the attached GAAP
to non-GAAP reconciliation
(4) During quarter ended 6/30/07, certain loans were reclassified
between these two categories and thus the resulting quarterly
change is not meaningful
2008
-----------
1st Quarter
-----------
Reconciliation Table- GAAP to non-GAAP:
Book Value per share $ 13.34
Effect of intangible assets per share (5.62)
Tangible book value $ 7.72
Equity $ 309,876
Intangible assets 131,953
Less tax effect of Core-Deposit Intangible (38%) (1,474)
Tangible equity $ 179,397
Assets $2,818,477
Intangible assets 130,479
Tangible assets $2,687,998
Equity/Assets 10.99%
Effect of intangible assets -4.32%
Tangible Equity/Tangible Assets 6.67%
Average Equity $ 313,635
Average Intangible assets 132,599
Less tax effect of Core-Deposit Intangible (38%) (1,533)
Average tangible equity $ 182,569
Net Income (loss) (a) $ (24,198)
Return on average tangible equity -13.25%
Diluted earnings (loss) per share $ (1.22)
Effect of securities (gains) losses, net of tax (0.06)
Effect of prepayment of FHLB advances, net of tax --
Diluted operating earnings (loss) per share $ (1.28)
Net income (loss) $ (24,198)
Effect of securities (gains) losses, net of tax (1,280)
Effect of prepayment of FHLB advances, net of tax --
Net operating income (loss) $ (25,478)
2007
------------------------------------------------------
4th 3rd 2nd 1st
Dec 31/YTD Quarter Quarter Quarter Quarter
------------------------------------------------------
Reconciliation Table - GAAP to non-GAAP:
Book Value per
share $ 16.22 $ 16.22 $ 16.52 $ 16.38 $ 16.25
Effect of
intangible
assets per
share (6.94) (6.94) (6.95) (6.84) (6.86)
Tangible
book value $ 9.28 $ 9.28 $ 9.57 $ 9.54 $ 9.39
Equity $ 306,693 $ 306,693 $ 312,036 $ 314,687 $ 311,729
Intangible
assets 132,696 132,696 132,942 133,218 133,416
Less tax
effect of
Core-Deposit
Intangible
(38%) (1,568) (1,568) (1,661) (1,754) (1,848)
Tangible
equity $ 175,565 $ 175,565 $ 180,755 $ 183,223 $ 180,161
Assets $2,833,071 $2,833,071 $2,723,986 $2,672,177 $2,541,603
Intangible
assets 131,129 131,129 131,281 131,464 131,568
Tangible
assets $2,701,942 $2,701,942 $2,592,705 $2,540,713 $2,410,035
Equity/Assets 10.83% 10.83% 11.46% 11.78% 12.27%
Effect of
intangible
assets -4.33% -4.33% -4.49% -4.57% -4.79%
Tangible
Equity/
Tangible
Assets 6.50% 6.50% 6.97% 7.21% 7.48%
Average
Equity $ 313,504 $ 315,791 $ 316,060 $ 313,877 $ 308,691
Average
Intangible
assets 133,878 132,849 133,117 133,363 136,228
Less tax
effect of
Core-Deposit
Intangible
(38%) (1,763) (1,626) (1,720) (1,813) (1,896)
Average
tangible
equity $ 181,389 $ 184,568 $ 184,663 $ 182,327 $ 174,359
Net Income
(loss) (a) $ 6,588 $ (27,268)$ 2,281 $ 24,467 $ 27,521
Return on
average
tangible
equity 3.63% -14.77% 1.24% 13.42% 15.78%
Diluted
earnings
(loss) per
share $ 0.34 $ (0.36)$ 0.03 $ 0.31 $ 0.35
Effect of
securities
(gains)
losses, net
of tax -- -- -- -- --
Effect of
prepayment of
FHLB advances,
net of tax -- -- -- -- --
Diluted
operating
earnings
(loss) per
share $ 0.34 $ (0.36)$ 0.03 $ 0.31 $ 0.35
Net income
(loss) $ 6,588 $ (6,873)$ 575 $ 6,100 $ 6,786
Effect of
securities
(gains)
losses, net
of tax 2 -- 3 -- (1)
Effect of
prepayment of
FHLB advances,
net of tax -- -- -- -- --
Net operating
income
(loss) $ 6,590 $ (6,873)$ 578 $ 6,100 $ 6,785
2006
-------------------------------------------------------
4th 3rd 2nd 1st
Dec 31/YTD Quarter Quarter Quarter Quarter
-------------------------------------------------------
Reconciliation Table- GAAP to non-GAAP:
Book Value
per share $ 15.99 $ 15.99 $ 15.78 $ 14.71 $ 13.79
Effect of
intangible
assets per
share (7.00) (7.00) (7.02) (6.05) (6.71)
Tangible
book value $ 8.99 $ 8.99 $ 8.76 $ 8.66 $ 7.08
Equity $ 306,408 $ 306,408 $ 302,273 $ 257,780 $ 217,641
Intangible
assets 133,094 133,094 136,518 107,921 107,788
Less tax
effect of
Core-Deposit
Intangible
(38%) (1,942) (1,942) (2,035) (1,865) (1,949)
Tangible
equity $ 175,256 $ 175,256 $ 167,790 $ 151,724 $ 111,802
Assets $2,494,071 $2,494,071 $2,314,913 $1,974,376 $1,912,841
Intangible
assets 131,152 131,152 134,483 106,056 105,839
Tangible
assets $2,362,919 $2,362,919 $2,180,430 $1,868,320 $1,807,002
Equity/Assets 12.29% 12.29% 13.06% 13.06% 11.38%
Effect of
intangible
assets -4.87% -4.87% -5.36% -4.94% -5.19%
Tangible
Equity/
Tangible
Assets 7.42% 7.42% 7.70% 8.12% 6.19%
Average
Equity $ 252,004 $ 304,362 $ 283,937 $ 235,731 $ 182,219
Average
Intangible
assets 112,385 136,443 125,227 107,763 79,313
Less tax
effect of
Core-Deposit
Intangible
(38%) (1,921) (2,001) (2,006) (1,918) (1,754)
Average
tangible
equity $ 141,540 $ 169,920 $ 160,716 $ 129,886 $ 104,660
Net Income
(loss) (a) $ 23,392 $ 20,718 $ 27,534 $ 24,427 $ 20,846
Return on
average
tangible
equity 16.53% 12.19% 17.13% 18.81% 19.92%
Diluted
earnings
(loss)
per share $ 1.33 $ 0.26 $ 0.37 $ 0.36 $ 0.35
Effect of
securities
(gains)
losses,
net of tax 0.06 0.05 0.01 -- --
Effect of
prepayment of
FHLB advances
net of tax (0.01) -- (0.01) -- --
Diluted
operating
earnings
(loss) per
share $ 1.38 $ 0.31 $ 0.37 $ 0.36 $ 0.35
Net income
(loss) $ 23,392 $ 5,222 $ 6,940 $ 6,090 $ 5,140
Effect of
securities
(gains)
losses, net
of tax 980 808 172 -- --
Effect of
prepayment of
FHLB advances,
net of tax (174) -- (174) -- --
Net operating
income
(loss) $ 24,198 $ 6,030 $ 6,938 $ 6,090 $ 5,140
(a) The actual number of days in the period were used to
annualize income