-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GvrQmAy3l6v64u+ziA1AsQx9cHOaGP6AInkCIa9AeXV/biDQ68SCjNy0pkNfXqi3 trIHqFsWMgvkW8Zs93WsqQ== /in/edgar/work/20000814/0000950159-00-000337/0000950159-00-000337.txt : 20000921 0000950159-00-000337.hdr.sgml : 20000921 ACCESSION NUMBER: 0000950159-00-000337 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SUMMIT BANCORP/NJ/ CENTRAL INDEX KEY: 0000101320 STANDARD INDUSTRIAL CLASSIFICATION: [6021 ] IRS NUMBER: 221903313 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-06451 FILM NUMBER: 701009 BUSINESS ADDRESS: STREET 1: 301 CARNEGIE CENTER STREET 2: P O BOX 2066 CITY: PRINCETON STATE: NJ ZIP: 08543-2066 BUSINESS PHONE: 6099873200 MAIL ADDRESS: STREET 1: PO BOX 2066 STREET 2: 301 CARNEGIE CTR CITY: PRINCETON STATE: NJ ZIP: 08543-2066 FORMER COMPANY: FORMER CONFORMED NAME: UJB FINANCIAL CORP /NJ/ DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: UNITED JERSEY BANKS DATE OF NAME CHANGE: 19890815 10-Q 1 0001.txt =============================================================================== FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2000 ------------------------------ or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number: 1-6451 --------- SUMMIT BANCORP. (Exact name of registrant as specified in its charter) New Jersey 22-1903313 - -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 301 Carnegie Center, P.O. Box 2066, Princeton, New Jersey 08543-2066 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (609) 987-3200 - -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) - -------------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [ ] No As of July 31, 2000 there were 173,926,726 shares of common stock, $.80 par value, outstanding. ================================================================================ Summit Bancorp Form 10-Q Index Page No. Part I Financial Information Item 1. Financial Statements (unaudited) Consolidated Balance Sheets- June 30, 2000, December 31, 1999, and June 30, 1999........... 1 Consolidated Statements of Income- Three and Six Months Ended June 30, 2000, and 1999............ 2 Consolidated Statements of Shareholders' Equity- Six Months Ended June 30, 2000, and 1999..................... 3 Consolidated Statements of Cash Flows- Six Months Ended June 30, 2000, and 1999..................... 4 Notes to Consolidated Financial Statements (unaudited)............ 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations............................... 7 Item 3. Quantitative and Qualitative Disclosures About Market Risk........ 22 Part II. Other Information Item 1. Legal Proceedings................................................. 23 Item 2. Changes in Securities and Use of Proceeds......................... 23 Item 3. Defaults Upon Senior Securities................................... 23 Item 4. Submissions of Matters to a Vote of Security Holders.............. 23 Item 5. Other Information................................................. 23 Item 6. Exhibits and Reports on Form 8-K.................................. 23 Signature......................................................... 24 Exhibit Index..................................................... 25 ii Summit Bancorp and Subsidiaries Consolidated Balance Sheets Unaudited (In thousands)
June 30, Dec. 31, June 30, 2000 1999 1999 ------------ ------------ ------------ Assets Cash and due from banks $ 1,192,496 $ 1,160,577 $ 1,009,863 Federal funds sold and securities purchased under agreements to resell -- 5,000 16,463 Interest-bearing deposits with banks 26,845 32,870 15,297 Securities: Trading account 26,554 20,118 18,990 Available for sale 6,226,991 5,199,121 4,375,966 Held to maturity 5,030,416 5,597,383 6,378,484 ------------ ------------ ------------ Total securities 11,283,961 10,816,622 10,773,440 Loans (net of unearned discount): Commercial 9,262,281 8,134,497 7,526,178 Commercial mortgage 3,189,847 3,174,370 2,897,752 Residential mortgage 5,795,174 5,747,927 5,488,340 Consumer 6,800,536 6,170,162 5,626,550 ------------ ------------ ------------ Total loans 25,047,838 23,226,956 21,538,820 Less: Allowance for loan losses 334,851 328,828 321,700 ------------ ------------ ------------ Net loans 24,712,987 22,898,128 21,217,120 ------------ ------------ ------------ Goodwill and other intangibles 565,337 519,362 316,610 Premises and equipment 321,710 315,632 306,528 Accrued interest receivable 249,311 214,797 202,306 Due from customers on acceptances 20,007 22,311 20,901 Other assets 612,478 393,676 347,232 ------------ ------------ ------------ Total Assets $ 38,985,132 $ 36,378,975 $ 34,225,760 ============ ============ ============ Liabilities and Shareholders' Equity Deposits: Non-interest bearing demand deposits $ 5,296,357 $ 4,966,400 $ 4,704,062 Interest-bearing deposits: Savings and time deposits 20,043,841 18,653,398 18,054,408 Commercial certificates of deposit $100,000 and over 736,727 1,018,848 684,430 ------------ ------------ ------------ Total deposits 26,076,925 24,638,646 23,442,900 ------------ ------------ ------------ Other borrowed funds 5,883,846 4,593,064 3,734,712 Accrued expenses and other liabilities 337,558 357,152 343,443 Accrued interest payable 110,937 100,845 80,413 Bank acceptances outstanding 20,007 22,311 20,901 Long-term debt 3,616,616 3,864,777 4,001,925 ------------ ------------ ------------ Total liabilities 36,045,889 33,576,795 31,624,294 Shareholders' equity: Common stock par value $ .80: Authorized 390,000 shares; issued 177,274; 177,471; and 177,523 shares 141,819 141,977 142,018 Surplus 913,019 959,934 966,429 Retained earnings 2,084,707 1,948,985 1,859,908 Employee stock ownership plan obligation -- (1,250) (2,250) Accumulated other comprehensive loss, net of tax (112,611) (85,841) (39,478) Common stock held in treasury, at cost (3,137; 4,825; 7,883 shares) (87,691) (161,625) (325,161) ------------ ------------ ------------ Total shareholders' equity 2,939,243 2,802,180 2,601,466 ------------ ------------ ------------ Total Liabilities and Shareholders' Equity $ 38,985,132 $ 36,378,975 $ 34,225,760 ============ ============ ============ See accompanying Notes to Consolidated Financial Statements.
1 Summit Bancorp and Subsidiaries Consolidated Statements of Income Unaudited (In thousands, except per share data)
Three Months Ended Six Months Ended June 30, June 30, ------------------------- ------------------------- 2000 1999 2000 1999 ---------- ---------- ---------- ---------- Interest Income Loans $ 501,521 $ 407,045 $ 970,643 $ 810,712 Securities: Trading account 685 135 1,080 217 Available for sale 108,166 60,069 203,041 119,630 Held to maturity 81,746 100,850 167,211 197,390 ---------- ---------- ---------- ---------- Total securities 190,597 161,054 371,332 317,237 Other interest income 945 612 1,636 1,207 ---------- ---------- ---------- ---------- Total interest income 693,063 568,711 1,343,611 1,129,156 ---------- ---------- ---------- ---------- Interest Expense Savings and time deposits 196,107 157,347 371,540 308,749 Commercial certificates of deposit $100,000 and over 12,365 9,460 25,664 21,035 Borrowed funds, including long-term debt 140,709 93,313 266,618 185,437 ---------- ---------- ---------- ---------- Total interest expense 349,181 260,120 663,822 515,221 ---------- ---------- ---------- ---------- Net interest income 343,882 308,591 679,789 613,935 Provision for loan losses 24,500 16,500 44,500 33,000 ---------- ---------- ---------- ---------- Net interest income after provision for loan losses 319,382 292,091 635,289 580,935 ---------- ---------- ---------- ---------- Non-Interest Income Service charges on deposit accounts 31,862 29,567 63,407 59,643 Service and loan fee income 19,611 16,011 35,366 31,635 Insurance service fees 14,791 8,370 25,595 16,240 Trust income 13,686 12,844 27,458 24,770 Retail investment fees 10,820 10,612 23,559 20,770 Securities gains 2,761 2,094 2,846 2,311 Other 21,237 16,429 38,270 38,715 ---------- ---------- ---------- ---------- Total non-interest Income 114,768 95,927 216,501 194,084 ---------- ---------- ---------- ---------- Non-Interest Expenses Salaries 93,438 82,606 181,402 162,932 Pension and other employee benefits 32,285 29,132 62,557 59,149 Furniture and equipment 25,486 22,517 50,935 44,968 Occupancy, net 21,400 19,263 43,535 39,098 Amortization of goodwill and other intangibles 9,912 6,468 18,912 12,339 Communications 9,405 9,696 18,919 19,314 Advertising and public relations 6,193 5,927 12,337 11,455 Other 39,007 31,607 77,370 63,398 ---------- ---------- ---------- ---------- Total non-interest expenses 237,126 207,216 465,967 412,653 ---------- ---------- ---------- ---------- Net Income before taxes 197,024 180,802 385,823 362,366 Federal and state income taxes 66,922 60,465 130,808 123,288 ---------- ---------- ---------- ---------- Net Income $ 130,102 $ 120,337 $ 255,015 $ 239,078 ========== ========== ========== ========== Net Income per Common Share: Basic $ 0.74 $ 0.71 $ 1.46 $ 1.39 Diluted 0.74 0.70 1.46 1.38 Average Common Shares Outstanding: Basic 175,304 170,656 174,243 172,216 Diluted 176,293 172,282 175,245 173,861 See accompanying Notes to Consolidated Financial Statements.
2
Summit Bancorp and Subsidiaries Consolidated Statements of Shareholders' Equity Unaudited (In thousands) Accum. Other Total Common Retained ESOP Comprehensive Treasury Shareholders' Stock Surplus Earnings Obligation Income (Loss) Stock Equity Balance, December 31, 1998 $142,106 $1,013,393 $1,728,135 $(3,394) $12,087 $(169,900) $2,722,427 Comprehensive income: Net income -- -- 239,078 -- -- -- 239,078 Unrealized loss on securities arising during the period (net of tax $27,350) -- -- -- -- (53,090) -- Less: Reclassification adjustment for gains included in net income (net of tax $786) -- -- -- -- 1,525 -- -------- Net unrealized loss on securities arising during the period (net of tax $26,564) (51,565) (51,565) ----------- Total comprehensive income -- -- -- -- -- -- 187,513 Cash dividend declared on common stock -- -- (107,305) -- -- -- (107,305) Employee stock plans (877 shares) (88) (48,531) -- -- -- 37,630 (10,989) Treasury shares issued for acquisitions (1,131 shares) -- 1,567 -- -- -- 47,079 48,646 Purchase of common stock (6,018 shares) -- -- -- -- -- (239,970) (239,970) ESOP debt repayment -- -- -- 1,144 -- -- 1,144 ----------------------------------------------------------------------------------- Balance, June 30, 1999 $142,018 $966,429 $1,859,908 $(2,250) $(39,478) $(325,161) $2,601,466 =================================================================================== Balance, December 31, 1999 $141,977 $959,934 $1,948,985 $(1,250) $(85,841) $(161,625) $2,802,180 Comprehensive income: Net income -- -- 255,015 -- -- -- 255,015 Unrealized loss on securities arising during the period (net of tax $14,759) -- -- -- -- (28,648) -- Less: Reclassification adjustment for gains included in net income (net of tax $968) -- -- -- -- 1,878 -- -------- Net unrealized loss on securities arising during the period (net of tax $13,791) -- -- -- -- (26,770) -- (26,770) --------- Total comprehensive income -- -- -- -- -- -- 228,245 Cash dividend declared on common stock -- -- (119,293) -- -- -- (119,293) Shares issued for employee stock plans (957 shares) (158) (20,757) -- -- -- 29,945 9,030 Treasury shares issued for acquisitions (3,912 shares) -- (26,158) -- -- -- 129,903 103,745 Purchase of common stock (3,181 shares) -- -- -- -- -- (85,914) (85,914) ESOP debt repayment -- -- -- 1,250 -- -- 1,250 ----------------------------------------------------------------------------------- Balance, June 30, 2000 $141,819 $913,019 $2,084,707 $ -- $(112,611) $(87,691) $2,939,243 ===================================================================================
See accompanying Notes to Consolidated Financial Statements. 3 Summit Bancorp and Subsidiaries Consolidated Statements of Cash Flows Unaudited (In thousands)
Six Months Ended June 30 ------------------------------- Operating Activities 2000 1999 ----------- ----------- Net income $ 255,015 $ 239,078 Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses 44,500 33,000 Depreciation, amortization and accretion, net 42,461 35,108 Gains on sales of securities (2,846) (2,311) Gains on sales of mortgages held for sale (3,194) (10,756) Gains on sales of other real estate owned (1,738) (988) Proceeds from the sales of other real estate owned 5,173 6,338 Proceeds from the sales of mortgages held for sale 173,143 463,476 Originations of mortgages held for sale (198,822) (480,013) Net increase in trading account securities (6,436) (6,437) Net change in other accrued and deferred income and expense (44,383) (48,612) ----------- ----------- Net cash provided by operating activities 262,873 227,883 ----------- ----------- Investing Activities Purchases of securities held to maturity (760) (1,630,736) Purchases of securities available for sale (1,461,748) (2,039,333) Proceeds from maturities of securities held to maturity 614,493 1,273,983 Proceeds from maturities of securities available for sale 418,774 1,068,731 Proceeds from sales of securities available for sale 35,488 533,850 Net decrease in Federal funds sold, securities purchased under agreements to resell and interest bearing deposits with banks 19,570 28,629 Net increase in loans (1,575,068) (330,514) Purchases of premises and equipment, net (45,580) (39,799) Purchase of corporate owned life insurance (192,376) -- ----------- ----------- Net cash used in investing activities (2,187,207) (1,135,189) ----------- ----------- Financing Activities Net increase in deposits 1,134,941 143,882 Net increase in short-term borrowings 1,303,532 544,724 Principal payments on long-term debt (813,748) (72,737) Proceeds from the issuance of long-term debt 511,375 501,860 Dividends paid (115,181) (104,044) Purchase of common stock (85,914) (239,970) Proceeds from issuance of common stock under stock option plans 6,409 7,099 ----------- ----------- Net cash provided by financing activities 1,941,414 780,814 ----------- ----------- Increase (decrease) in cash and due from banks 17,080 (126,492) Beginning cash balance of acquired entities 14,839 6,496 Cash and due from banks at beginning of period 1,160,577 1,129,859 ----------- ----------- Cash and due from banks at end of period $ 1,192,496 $ 1,009,863 =========== =========== Supplemental disclosure of cash flow information Cash paid: Interest payments $ 653,730 $ 529,238 Income tax payments 134,222 84,942 Noncash investing activities: Net transfer of loans to other real estate owned 1,250 5,986
4 Summit Bancorp and Subsidiaries Notes to Consolidated Financial Statements (Unaudited) 1.) Basis of Presentation The accompanying financial statements reflect, in the opinion of management, all normal recurring adjustments necessary to present fairly the consolidated financial position of Summit Bancorp and subsidiaries ("Summit Bancorp"), and its consolidated results of operations, changes in shareholders' equity and changes in cash flows. All significant intercompany accounts and transactions have been eliminated in consolidation. In all material respects, the financial statements presented comply with the current reporting requirements of supervisory authorities. Certain prior period amounts have been reclassified to conform to the financial statement presentation of 2000. For additional information and disclosures required under generally accepted accounting principles, reference is made to Summit Bancorp's 1999 Annual Report on Form 10-K. 2.) Acquisitions On March 29, 2000, Summit Bancorp completed the acquisition of NMBT Corp. ("NMBT"). NMBT was headquartered in New Milford, Connecticut and operated ten branches in western Connecticut with $430.0 million in assets. This acquisition was accounted for as a purchase, with the issuance of 2.6 million shares of treasury stock. The cost in excess of the fair value of net assets acquired resulted in goodwill and other intangibles of $36.6 million which is being amortized over a 20 year period. On March 17, 2000, Summit Bancorp completed its acquisition of selected assets of Patgo Insurance Agency, Inc., Patgo South, Inc., Patgo International, Inc. and Crown Insurance Agency, Inc. These companies provide both property and casualty insurance and group benefit services. This acquisition was accounted for as a purchase with the cost in excess of the fair value of net assets acquired resulting in goodwill and other intangibles of $4.3 million which is being amortized over a 10 year period. On February 29, 2000, Summit Bancorp completed its acquisition of Meeker Sharkey Financial Group. Meeker Sharkey Financial Group offers an array of property and casualty products, group health insurance benefits and retirement plan services. This transaction was accounted for as a purchase with the issuance of 1.3 million shares of treasury stock. The cost in excess of the fair value of net assets acquired resulted in goodwill and other intangibles of $24.1 million which is being amortized over a 10 year period. On August 1, 1999, Summit Bancorp completed the acquisition of Prime Bancorp Inc. Prime Bancorp was headquartered in Fort Washington, Pennsylvania and operated 27 branches in the greater Philadelphia area with $1.1 billion in assets. This acquisition was accounted for as a purchase, with the issuance of 7.4 million shares of treasury stock. The cost in excess of the fair value of net assets acquired resulted in goodwill and other intangibles of $220.5 million which is being amortized over a 20 year period. On March 31, 1999, Summit Bancorp completed the acquisition of New Canaan Bank and Trust Company. New Canaan Bank and Trust Company was headquartered in New Canaan, Connecticut and operated four branches with $182.0 million in assets. This acquisition was accounted for as a purchase, with the issuance of 1.1 million shares of treasury stock. The cost in excess of the fair value of net assets acquired resulted in goodwill and other intangibles of $35.1 million which is being amortized over a 20 year period. 5 3.) Net Income per Common Share Basic net income per common share is calculated by dividing net income by the weighted average common shares outstanding during the period. Diluted net income per common share is computed similarly to that of basic net income per common share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all potentially dilutive common share equivalents, principally stock options, were issued during the reporting period.
- --------------------------------------------------------------------------------------------------------------------- (In thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, - --------------------------------------------------------------------------------------------------------------------- 2000 1999 2000 1999 - --------------------------------------------------------------------------------------------------------------------- Net Income $ 130,102 $ 120,337 $ 255,015 $ 239,078 ===================================================================================================================== Basic weighted-average common shares outstanding 175,304 170,656 174,243 172,216 Plus: Common stock equivalents 989 1,626 1,002 1,645 - --------------------------------------------------------------------------------------------------------------------- Diluted weighted-average common shares outstanding 176,293 172,282 175,245 173,861 ===================================================================================================================== Net Income per Common Share: Basic $ 0.74 $ 0.71 $ 1.46 $ 1.39 Diluted 0.74 0.70 1.46 1.38 =====================================================================================================================
4.) Restructuring Charges During the fourth quarter of 1999, a restructuring charge of $27.9 million pretax, ($17.1 million, or $0.10 per diluted share after tax) was recorded in conjunction with the realignment of key lines of business and lines of support. The realignment eliminated approximately 260 positions. Employees affected by the realignment were notified at the time of the restructure. The table below displays the status of accrual reserves for business restructuring charges at June 30, 2000. The majority of the restructuring charge is expected to be utilized by year-end December 31, 2000.
- -------------------------------------------------------------------------------------------------------- Restructuring Charges (In millions) - -------------------------------------------------------------------------------------------------------- Recorded Utilization Remaining Type of cost Liability to date Liability - -------------------------------------------------------------------------------------------------------- Severance and benefits $ 26.1 $ 18.3 $ 7.8 Real estate and other 1.8 0.4 1.4 - -------------------------------------------------------------------------------------------------------- Total $ 27.9 $ 18.7 $ 9.2 - --------------------------------------------------------------------------------------------------------
5.) Recent Accounting Pronouncements In June 1999, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 137, "Accounting for Derivative Instruments and Hedging Activities-Deferral of the Effective Date of FASB Statement No. 133." This statement delays the effective date of FASB Statement No. 133 one year. SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended by SFAS No. 138, "Accounting for Certain Derivative Instruments and Certain Hedging Activities," establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. It requires recognition of all derivative instruments as either assets or liabilities in the statement of financial position and measurement of those instruments at fair value. This statement is now effective for all fiscal years beginning after June 15, 2000, on a prospective basis. The adoption of SFAS No. 133 is not expected to have a material impact on the financial position or results of operations of Summit Bancorp. 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF - ----------------------------------------------- FINANCIAL CONDITION AND RESULTS OF OPERATIONS. --------------------------------------------- Summit Bancorp is a bank holding company headquartered in Princeton, New Jersey. Summit Bancorp owns bank subsidiaries in New Jersey, Pennsylvania, and Connecticut and several active non-bank subsidiaries. Summit Bancorp's bank subsidiaries provide a broad range of retail, insurance, commercial, and private banking services as well as trust and investment services to individuals, businesses, not-for-profit organizations, government entities, and other financial institutions. These services are provided through an extensive branch network, including supermarket branches and private banking facilities, as well as through automated teller machines and the Internet. FINANCIAL CONDITION Total assets at June 30, 2000, were $39.0 billion, an increase of $2.6 billion, or 7.2 percent, from year-end 1999. The growth came most notably from the loan portfolios and was generally funded with increases in savings and time deposits and other borrowed funds. The increase in total assets attributable to acquisitions was approximately $430.0 million. Total securities at June 30, 2000, were $11.3 billion, an increase of $467.3 million, or 4.3 percent, from year-end 1999. The growth in total securities due to acquisitions was $101.8 million. Securities held to maturity, which are carried at amortized historical cost, are investments for which there is a positive intent and ability to hold to maturity. Securities held to maturity at June 30, 2000, were $5.0 billion and were comprised of U.S. Government and Federal agency securities totaling $3.3 billion, other securities, predominately corporate collateralized mortgage obligations ("CMOs") totaling $1.6 billion, and securities of state and political subdivisions totaling $103.2 million. Held to maturity securities decreased $567.0 million, or 10.1 percent, from year-end 1999 due primarily to principal repayments and maturities of $614.5 million. These funds were reinvested in securities available for sale. At June 30, 2000, and December 31, 1999, net unrealized losses on securities held to maturity amounted to $194.4 million and $209.3 million, respectively. Securities available for sale are investments that may be sold in response to changing market and interest rate conditions or for other business purposes. Activity in this portfolio is initiated primarily to manage liquidity and interest rate risk and to take advantage of certain market conditions. At June 30, 2000, securities available for sale amounted to $6.2 billion and were predominately comprised of $4.6 billion of U.S. Government and Federal agency securities and $1.3 billion of CMOs. Total available for sale securities increased $1.0 billion, or 19.8 percent, from year-end 1999. The increase resulted primarily from $1.5 billion in purchases partially offset by sales and maturities of $454.3 million. These purchases were partially funded by the cash flows from the securities held to maturity portfolio. The loan portfolio, which represents Summit's largest asset, is a significant source of both interest and fee income. Elements of the loan portfolio are subject to differing levels of credit and interest rate risk. Summit's lending strategy stresses portfolio diversification by product, geography, and industry. At June 30, 2000, total loans amounted to $25.1 billion, an increase of $1.8 billion, or 7.8 percent, from year-end 1999. The growth in total loans due to acquisitions was $269.3 million. The largest increases were in commercial and consumer loans which grew $1.1 billion and $630.4 million respectively. Additionally, residential mortgages grew $47.2 million and commercial mortgages increased $15.5 million. The increase in commercial loans was primarily related to loan growth in commercial and industrial, syndicated loans and the food, media and large corporate portfolios. The increase in the consumer loan portfolio was primarily attributed to home equity loan promotions and purchases of home equity loans. Residential mortgages totaling $157 million were sold in June 2000. Mortgage loans held for sale amounted to $51.1 million and $65.5 million for the periods ended June 30, 2000, and December 31, 1999, respectively. Other assets increased $218.8 million, or 55.6 percent, from year-end 1999. The increase was primarily related to the purchase of $192.4 million in corporate owned life insurance in June 2000. Deposits, which include non-interest bearing demand deposits and interest-bearing savings and time deposits, are a fundamental source of funding. Summit offers a variety of products designed to attract and retain customers, with the primary focus on building and expanding relationships. Total deposits were $26.1 billion at June 30, 2000, an increase of $1.4 billion, or 5.8 percent, from December 31, 1999. Acquisitions during the period contributed 7 $303.3 million to the increase. Savings and time deposits at $20.0 billion, increased $1.4 billion, or 7.5 percent, from December 31, 1999. The growth came most notably from retail certificates of deposit which increased $1.1 billion from December 31, 1999, as a result of the introduction of several new certificate of deposit products. In addition, Summit's cash management solution, the Summit Navigator Account, increased $806.8 million, or 27.1 percent, from year-end 1999. The Summit Navigator Account is a relationship sweep account that combines banking, investment, and brokerage services into one account. These increases more than offset the decline of $519.3 million in other deposit products largely resulting from a shift the deposit mix. Demand deposits also increased by $330.0 million, or 6.6 percent, from year-end 1999 to total $5.3 billion at June 30, 2000. The increase in demand deposits came mainly from business and personal accounts. Partially offsetting these deposit increases was a decline in commercial certificates of deposit $100,000 and over of $282.1 million, or 27.7 percent, compared to December 31, 1999, related to using alternative funding sources to support balance sheet growth. Other borrowed funds are mainly comprised of repurchase agreements, Federal funds purchased, Federal Home Loan Bank borrowings ("FHLB"), and other short-term borrowings. Other borrowed funds totaled $5.9 billion at June 30, 2000, an increase of $1.3 billion, or 28.1 percent, from December 31, 1999. The increase in other borrowed funds is the result of asset growth and a change in funding mix. Total long-term debt was $3.6 billion at June 30, 2000, a decrease of $248.2 million, or 6.4 percent, from year-end 1999. The decrease was primarily due to a shift in the funding mix. Total shareholders' equity at June 30, 2000, was $2.9 billion, an increase of $137.1 million, or 4.9 percent, from December 31, 1999. The increase was primarily attributed to retained profits and the issuance of treasury stock for acquisitions. Treasury stock at June 30, 2000, amounted to $87.7 million, a reduction of $73.9 million, or 45.7 percent, compared to December 31, 1999, and was comprised of 3,136,633 shares. The reduction in treasury stock was the result of the issuance of shares for the purchase acquisitions of NMBT and Meeker Sharkey Financial Group. Treasury shares on hand will be used for acquisitions, employee benefit plans, and general corporate purposes. Included in shareholders' equity at June 30, 2000, was accumulated other comprehensive loss, net of tax, totaling $112.6 million, compared to a loss of $85.8 million at year-end 1999. Accumulated other comprehensive loss is comprised principally of unrealized gains and losses, net of tax, on securities available for sale. The increase in accumulated other comprehensive loss was due to the decline in the market value of Summit's fixed income securities caused by the rising rate environment. Summit Bancorp's capital ratios for June 30, 2000, compared to select prior periods and regulatory requirements, are shown in the following table. Summit Bancorp's bank subsidiaries met the well-capitalized requirements for each of the periods presented. The decreases in the ratios at June 30, 2000, were principally attributable to asset growth.
- --------------------------------------------------------------------------------------------------------- Minimum June 30, Dec.31, June 30, Required Well Selected Capital Ratios: 2000 1999 1999 Capital Capitalized - --------------------------------------------------------------------------------------------------------- Equity to assets 7.54 % 7.70 % 7.60 % -- % -- % Leverage ratio 6.95 7.06 7.47 3.00 5.00 Tier I capital 9.03 9.46 9.97 4.00 6.00 Total risk-based 10.49 11.06 11.76 8.00 10.00 capital - ---------------------------------------------------------------------------------------------------------
8 Non-performing Assets Non-performing assets include non-performing loans and other real estate owned ("OREO") and are shown in the following table as of the dates indicated.
- --------------------------------------------------------------------------------------------------------- Non-performing Assets June 30, Dec. 31, June 30, (In thousands) 2000 1999 1999 - --------------------------------------------------------------------------------------------------------- Non-performing loans: Commercial and industrial $ 91,328 $ 78,303 $ 76,737 Commercial mortgage 21,846 18,480 11,764 Construction and development 2,085 3,538 6,324 - --------------------------------------------------------------------------------------------------------- Non-performing loans 115,259 100,321 94,825 OREO, net 4,661 6,881 6,342 - --------------------------------------------------------------------------------------------------------- Non-performing assets $119,920 $107,202 $101,167 - --------------------------------------------------------------------------------------------------------- Loans, not included above, past due 90 days or more $ 46,607 $ 41,378 $ 37,674 - --------------------------------------------------------------------------------------------------------- Non-performing loans to total loans 0.46% 0.43% 0.44% Non-performing assets to total loans and OREO 0.48 0.46 0.47 - ---------------------------------------------------------------------------------------------------------
Average non-performing loans were $103.4 million and $83.5 million for the six months ended June 30, 2000, and June 30, 1999, respectively. Interest income received on non-performing loans amounted to $0.6 million for the six months ended June 30, 2000, compared to $1.2 million for the six months ended June 30, 1999. Loans which are past due 90 days or more but are not included in non-performing assets are primarily residential mortgage and consumer loans which are well secured and in the process of collection. Potential problem loans, which are excluded from non-performing assets, are loans where information about possible credit problems of borrowers causes management to have doubts as to the ability of such borrowers to comply with loan repayment terms. These loans amounted to $46.7 million at June 30, 2000, compared to $11.9 million and $64.5 million at December 31, 1999, and June 30, 1999, respectively. Allowance for Loan Losses The allowance for loan losses is a valuation reserve available for losses incurred or inherent in the loan portfolio and other extensions of credit. Credit losses arise primarily from the loan portfolio, but may also be derived from other credit-related sources including commitments and other extensions of credit, guarantees, and standby letters of credit. Additions are made to the allowance through periodic provisions, which are charged to expense. All losses of principal are charged to the allowance when incurred or when a determination is made that a loss is expected. Subsequent recoveries, if any, are credited to the allowance. A process has been established to assess the appropriateness of the allowance for loan losses and to identify the risks inherent in the loan portfolio. This process consists of the identification of specific reserves for identified problem loans, the calculation of general reserves, which includes a combination of formula-driven allocations and minimum reserve levels by loan type and grade, and the determination of the unallocated reserves. Specific reserves are determined through assessment of the borrower's ability to repay and the fair value of the underlying collateral, for collateral dependent loans, for each non-performing loan. If the carrying value of a loan exceeds the discounted expected cash flows or the value of the underlying collateral, the excess is specifically reserved or charged off. The level of specific reserves is generally the smallest component of the allowance for loan losses. The calculation of the general reserve involves several steps. An historical loss factor is applied to each loan and unused commitment by business segment and loan grade. The historical loss factors are calculated using a trailing six quarter loss migration analysis. Adjustments are then made to the historical loss factors based on six quantitative objective elements (delinquency, non-performing assets, watch lists, charge offs, concentrations of credit, and 9 recoveries) and three subjective elements (economic conditions, the rating assigned by the internal credit audit department, and other factors). This methodology is applied to the commercial portfolio. The methodology for the retail portfolio involves a six quarter loss migration analysis which may be adjusted due to rising trends or charge offs. For the commercial loan portfolios, the historical loss factor, inclusive of the adjustment, is then compared to minimum reserve levels for each loan grade. The larger of the two factors is used in the determination of the reserves. The reserves calculated for the residential and consumer loans employ an historical six quarter migration analysis. The last component of the loan loss reserve is the unallocated reserve. The unallocated reserve is based upon management's evaluation of the underlying inherent risk in the loan portfolio. The analysis of the appropriate level of reserves, in the aggregate, is based on the level of specific and general reserves previously discussed and is also inclusive of: industry concentrations, delinquency trends, economic trends, loan growth relative to the overall allowance, the level of substandard assets, and the amount of allocated and unallocated reserves relative to the total loan portfolio. The unallocated portion of the allowance for loan losses, in excess of specific and general reserves, was $134.1 million at June 30, 2000, compared to $119.8 million at December 31, 1999. The provision for loan losses for the second quarter of 2000 was $24.5 million, a $8.0 million increase from the same period a year ago. The increase in the provision for loan losses for the three months ended June 30, 2000, was primarily attributed to loan growth and an increase in the level of charge offs. The provision for loan losses is charged to expense to bring the allowance for loan losses to a level deemed appropriate by management to cover the credit risk inherent in the loan portfolio. The provision for loan losses may vary from quarter to quarter due to loan growth, the level of charge offs, or an increase in the inherent risk in the loan portfolio. The allowance as a percentage of total loans was 1.34 percent at June 30, 2000, compared to 1.42 percent and 1.49 percent at December 31, 1999, and June 30, 1999, respectively. The following tables show the transactions in the allowance for loan losses, by loan category, for the three and six month periods ended June 30, 2000, and June 30, 1999, and selected loan quality ratios for the periods ended June 30, 2000, December 31, 1999, and June 30, 1999.
- ---------------------------------------------------------------------------------------------------------------- Allowance for Loan Losses Three Months Ended Six Months Ended June 30, June 30, (In thousands) 2000 1999 2000 1999 - ---------------------------------------------------------------------------------------------------------------- Balance, beginning of period $332,755 $328,302 $328,828 $322,814 Allowance of acquired institutions -- -- 4,357 2,140 Provision for loan losses 24,500 16,500 44,500 33,000 - ---------------------------------------------------------------------------------------------------------------- 357,255 344,802 377,685 357,954 - ---------------------------------------------------------------------------------------------------------------- Loans charged off: Commercial and industrial 19,417 20,268 39,441 28,399 Construction and development -- -- -- 13 Commercial mortgage 235 1,070 258 2,272 Residential mortgage 895 322 1,979 2,948 Consumer 6,397 7,178 12,650 15,165 - ---------------------------------------------------------------------------------------------------------------- Total loans charged off 26,944 28,838 54,328 48,797 - ---------------------------------------------------------------------------------------------------------------- Recoveries: Commercial and industrial 2,637 2,348 7,344 5,865 Construction and development 38 452 38 847 Commercial mortgage 11 193 39 741 Residential mortgage 90 116 150 435 Consumer 1,764 2,627 3,923 4,655 - ---------------------------------------------------------------------------------------------------------------- Total recoveries 4,540 5,736 11,494 12,543 - ---------------------------------------------------------------------------------------------------------------- Net charge offs 22,404 23,102 42,834 36,254 - ---------------------------------------------------------------------------------------------------------------- Balance, end of period $334,851 $321,700 $334,851 $321,700 ================================================================================================================
10 Selected Loan Quality Ratios - ------------------------------------------------------------------------------- June 30, Dec. 31, June 30, 2000 1999 1999 - ------------------------------------------------------------------------------- Net charge offs to average loans: Quarter-to-date 0.37 % 0.32 % 0.44 % Year-to-date 0.36 0.61 0.34 Allowance for loan losses to: Total loans at period end 1.34 % 1.42 % 1.49 % Non-performing loans 290.60 327.78 339.26 Non-performing assets 279.23 306.74 317.99 - ------------------------------------------------------------------------------- 11
Summit Bancorp and Subsidiaries Consolidated Average Balance Sheets with Resultant Interest and Rates Unaudited (Tax-equivalent basis, dollars in thousands) Three Months Ended --------------------------------------------------------------------------------- June 30, 2000 June 30, 1999 ---------------------------------------- ----------------------------------- Average Average Average Average Balance Interest Rate Balance Interest Rate ------------- -------- --------- ----------- --------- -------- Assets Interest-earning assets: Federal funds sold and securities purchased under agreements to resell $ 12,435 $197 6.37% $29,167 $350 4.81% Interest-bearing deposits with banks 53,395 748 5.63 23,716 262 4.43 Securities: Trading account 26,650 764 11.53 11,222 183 6.54 Available for sale 6,225,320 108,378 6.96 3,988,952 60,357 6.05 Held to maturity 5,202,509 82,525 6.35 6,551,577 101,871 6.22 ------------- -------- --------- ----------- --------- -------- Total securities 11,454,479 191,667 6.69 10,551,751 162,411 6.16 ------------- -------- --------- ----------- --------- -------- Loans, net of unearned discount: Commercial 8,796,398 192,859 8.82 7,377,701 141,791 7.71 Commercial mortgage 3,195,807 64,462 8.07 2,895,640 58,054 8.02 Residential mortgage 5,937,077 107,466 7.24 5,536,378 98,631 7.13 Consumer 6,540,821 137,870 8.48 5,458,995 109,760 8.06 ------------- -------- --------- ----------- --------- -------- Total loans 24,470,103 502,657 8.26 21,268,714 408,236 7.70 ------------- -------- --------- ----------- --------- -------- Total interest-earning assets 35,990,412 695,269 7.77 31,873,348 571,259 7.19 ------------- -------- --------- ----------- --------- -------- Non-interest earning assets: Cash and due from banks 1,064,320 958,692 Allowance for loan losses (333,868) (330,913) Other assets 1,573,712 1,175,609 ------------- ----------- Total non-interest earning assets 2,304,164 1,803,388 ------------- ----------- Total Assets $ 38,294,576 $ 33,676,736 ============= =========== Liabilities and Shareholders' Equity Interest-bearing liabilities: Savings deposits $ 11,938,079 89,273 3.01 $ 11,021,772 71,216 2.59 Time deposits 7,795,202 106,834 5.51 6,948,494 86,131 4.97 Commercial certificates of deposit $100,000 and over 831,695 12,365 5.98 797,238 9,460 4.76 ------------- -------- --------- ----------- --------- -------- Total interest-bearing deposits 20,564,976 208,472 4.08 18,767,504 166,807 3.56 ------------- -------- --------- ----------- --------- -------- Other borrowed funds 5,654,775 87,646 6.23 3,259,556 38,642 4.76 Long-term debt 3,676,231 53,063 5.77 3,975,757 54,671 5.50 ------------- -------- --------- ----------- --------- -------- Total interest-bearing liabilities 29,895,982 349,181 4.70 26,002,817 260,120 4.01 ------------- -------- --------- ----------- --------- -------- Non-interest bearing liabilities: Demand deposits 4,992,286 4,520,254 Other liabilities 488,756 518,481 ------------- ----------- Total non-interest bearing liabilities 5,481,042 5,038,735 Shareholders' equity 2,917,552 2,635,184 ------------- ----------- Total Liabilities and Shareholders' Equity $ 38,294,576 $33,676,736 ============= =========== Net Interest Spread 346,088 3.07 % 311,139 3.18 % ========= ======== Tax-equivalent basis adjustment (2,206) (2,548) -------- --------- Net Interest Income $ 343,882 $ 308,591 ======== ========= Net Interest Margin 3.87 % 3.92 % ========= ========
12
Summit Bancorp and Subsidiaries Consolidated Average Balance Sheets with Resultant Interest and Rates Unaudited (Tax-equivalent basis, dollars in thousands) Six Months Ended ---------------------------------------------------------------------------------- June 30, 2000 June 30, 1999 --------------------------------------- ------------------------------------ Average Average Average Average Balance Interest Rate Balance Interest Rate ----------- --------- -------- ----------- ---------- --------- Assets Interest-earning assets: Federal funds sold and securities purchased under agreements to resell $ 11,499 $ 331 5.79 % $ 19,959 $ 495 5.00 % Interest-bearing deposits with banks 48,493 1,305 5.41 28,699 712 5.00 Securities: Trading account 23,646 1,190 10.12 10,599 286 5.44 Available for sale 5,964,448 203,466 6.82 3,973,019 120,308 6.06 Held to maturity 5,326,216 168,806 6.34 6,389,949 199,458 6.24 ----------- --------- -------- ----------- ---------- --------- Total securities 11,314,310 373,462 6.60 10,373,567 320,052 6.17 ----------- --------- -------- ----------- ---------- --------- Loans, net of unearned discount: Commercial 8,523,884 366,295 8.64 7,268,132 278,854 7.74 Commercial mortgage 3,174,450 127,888 8.06 2,885,058 115,567 8.01 Residential mortgage 5,842,370 210,832 7.22 5,626,686 200,478 7.13 Consumer 6,412,266 267,896 8.40 5,438,268 218,432 8.10 ----------- --------- -------- ----------- ---------- --------- Total loans 23,952,970 972,911 8.17 21,218,144 813,331 7.73 ----------- --------- -------- ----------- ---------- --------- Total interest-earning assets 35,327,272 1,348,009 7.67 31,640,369 1,134,590 7.23 ----------- --------- -------- ----------- ---------- --------- Non-interest earning assets: Cash and due from banks 1,052,415 956,857 Allowance for loan losses (331,635) (328,133) Other assets 1,529,430 1,149,459 ----------- ----------- Total non-interest earning assets 2,250,210 1,778,183 ----------- ----------- Total Assets $ 37,577,482 $ 33,418,552 =========== =========== Liabilities and Shareholders' Equity Interest-bearing liabilities: Savings deposits $ 11,799,439 172,984 2.95 $ 10,661,577 133,105 2.52 Time deposits 7,449,612 198,556 5.36 7,035,370 175,644 5.03 Commercial certificates of deposit $100,000 and over 895,085 25,664 5.77 885,793 21,035 4.79 ----------- --------- -------- ----------- ---------- --------- Total interest-bearing deposits 20,144,136 397,204 3.97 18,582,740 329,784 3.58 ----------- --------- -------- ----------- ---------- --------- Other borrowed funds 5,372,636 159,997 5.99 3,335,296 80,129 4.84 Long-term debt 3,771,564 106,621 5.65 3,831,036 105,308 5.50 ----------- --------- -------- ----------- ---------- --------- Total interest-bearing liabilities 29,288,336 663,822 4.56 25,749,072 515,221 4.04 ----------- --------- -------- ----------- ---------- --------- Non-interest bearing liabilities: Demand deposits 4,924,013 4,487,984 Other liabilities 489,890 498,354 ----------- ----------- Total non-interest bearing liabilities 5,413,903 4,986,338 Shareholders' equity 2,875,243 2,683,142 ----------- ----------- Total Liabilities and Shareholders' Equity $ 37,577,482 $ 33,418,552 =========== =========== Net Interest Spread 684,187 3.11 % 619,369 3.19 % ======== ========= Tax-equivalent basis adjustment (4,398) (5,434) --------- ---------- Net Interest Income $ 679,789 $ 613,935 ========= ========== Net Interest Margin 3.89 % 3.95 % ======== =========
13 RESULTS OF OPERATIONS Net income for the quarter ended June 30, 2000, was $130.1 million, or $0.74 per basic share, compared to $120.3 million, or $0.71 per basic share, for the second quarter of 1999. On a diluted per share basis, net income for the three months ended June 30, 2000, was $0.74 per diluted share compared to $0.70 for the same period in 1999.
- -------------------------------------------------------------------------------------------------------------------- (In thousands) Three months ended Six Months Ended June 30, June 30, 2000 1999 2000 1999 - -------------------------------------------------------------------------------------------------------------------- Financial data: Net income $ 130,102 $ 120,337 $ 255,015 $ 239,078 Per share-diluted 0.74 0.70 1.46 1.38 Return on average assets 1.37 % 1.43 % 1.36 % 1.44 % Return on average equity 17.94 18.32 17.84 17.97 Efficiency ratio 52.02 51.20 52.00 50.88 - -------------------------------------------------------------------------------------------------------------------- Cash-basis financial data*: Net income $ 139,498 $ 126,597 $ 272,949 $ 251,000 Per share-diluted 0.79 0.73 1.56 1.44 Return on average tangible assets 1.49 % 1.52 % 1.48 % 1.53 % Return on average tangible equity 23.60 21.87 23.32 21.24 Efficiency Ratio 49.86 49.61 49.89 49.36 - --------------------------------------------------------------------------------------------------------------------
* Cash-basis financial data excludes the after tax impact of amortization of goodwill and other intangibles. Net Interest Income Interest income on a tax-equivalent basis was $1.3 billion for the six months ended June 30, 2000, an increase of $213.4 million, or 18.8 percent, compared to a year ago. Interest-earnings assets averaged $35.3 billion, an increase of $3.7 billion, or 11.7 percent, compared to the prior year period. The growth in interest-earning assets contributed $146.3 million to the increase in tax-equivalent interest income while the increase in yield contributed $67.1 million. The rate earned on interest-earning assets increased 44 basis points to 7.67 percent for the six months ended June 30, 2000. The increase was the result of a higher interest rate environment compared to last year as both the average Prime rate and the average London Interbank Offering Rate ("LIBOR") were significantly higher than the prior year. Interest expense increased $148.6 million, or 28.8 percent, for the six months ended June 30, 2000, compared to the same period a year ago. Interest-bearing liabilities averaged $29.3 billion for the six months ended June 30, 2000, an increase of $3.5 billion, or 13.8 percent, compared to the prior year. The growth in interest-bearing liabilities contributed $82.3 million to the increase in interest expense while the increase in rates paid on interest-bearing liabilities contributed the remaining $66.3 million. The rate paid on interest-bearing liabilities increased 52 basis points to 4.56 percent due to the higher interest-rate environment and a shift to a more expensive deposit mix. Net interest income on a tax-equivalent basis was $684.2 million for the six months ended June 30, 2000, an increase of $64.8 million, or 10.5 percent, compared to the same period in 1999. The net interest spread percentage on a tax-equivalent basis (the difference between the rate earned on average interest-earning assets and the rate paid on average interest-bearing liabilities) was 3.11 percent for the six months then ended, compared to 3.19 percent for the prior year period. Net interest margin (net interest income on a tax-equivalent basis as a percentage of average interest-earning assets) was 3.89 percent for the six months ended June 30, 2000, compared to 3.95 percent during the same period in 1999. The decline in net interest spread and margin was primarily caused by rates on interest-bearing liabilities rising more rapidly than yields on interest-earning assets. 14 The rate/volume table below presents an analysis of the impact on interest income and expense resulting from changes in average volumes and rates over the periods. Changes that are not due to volume or rate variances have been allocated proportionally to both, based on their relative absolute values.
Rate/Volume Table Amount of Increase (Decrease) ------------------------------------------------------------------------------------ Three Months Ended June30, Six Months Ended June 30, 2000 versus 1999 2000 versus 1999 ------------------------------------------------------------------------------------ Due to Change in: Due to Change in: ------------------------ ----------------------------- (Tax-equivalent basis, in millions) Volume Rate Total Volume Rate Total - ---------------------------------------------------------------------------------------------------------------------------------- Interest Income: Loans Commercial $ 29.2 $ 21.9 $ 51.1 $ 52.3 $ 35.2 $ 87.5 Commercial mortgage 6.0 0.4 6.4 11.6 0.7 12.3 Residential mortgage 7.3 1.5 8.8 7.8 2.6 10.4 Consumer 22.5 5.6 28.1 41.2 8.2 49.4 - ---------------------------------------------------------------------------------------------------------------------------------- Total loans 65.0 29.4 94.4 112.9 46.7 159.6 Securities held to maturity (21.4) 2.1 (19.3) (33.8) 3.1 (30.7) Securities available for sale 37.9 10.1 48.0 66.5 16.7 83.2 Other interest earning assets 0.4 0.5 0.9 0.7 0.6 1.3 - ---------------------------------------------------------------------------------------------------------------------------------- Total Interest Income 81.9 42.1 124.0 146.3 67.1 213.4 - ---------------------------------------------------------------------------------------------------------------------------------- Interest Expense: Deposits Savings deposits 6.1 11.9 18.0 15.4 24.5 39.9 Time deposits 11.0 9.8 20.8 10.8 12.1 22.9 Commercial Certificates of Deposits>$100M 0.4 2.5 2.9 0.2 4.4 4.6 - ---------------------------------------------------------------------------------------------------------------------------------- Total interest-bearing deposits 17.5 24.2 41.7 26.4 41.0 67.4 Other borrowed funds 34.5 14.5 49.0 57.5 22.4 79.9 Long-term debt (4.2) 2.6 (1.6) (1.6) 2.9 1.3 - ---------------------------------------------------------------------------------------------------------------------------------- Total Interest Expense 47.8 41.3 89.1 82.3 66.3 148.6 - ---------------------------------------------------------------------------------------------------------------------------------- Net Interest Income (fully taxable equivalent) $ 34.1 $ 0.8 $ 34.9 $ 64.0 $ 0.8 $ 64.8 - ---------------------------------------------------------------------------------------------------------------------------------- Decrease in tax-equivalent adjustment 0.4 1.1 - ---------------------------------------------------------------------------------------------------------------------------------- Increase in Net Interest Income $ 35.3 $ 65.9 - ----------------------------------------------------------------------------------------------------------------------------------
15 Non-interest Income Non-interest income categories for the three and six month periods ended June 30, 2000, and 1999 are shown in the following table:
- --------------------------------------------------------------------------------------------------------------------- (In millions) Three Months Ended June 30, Six Months Ended June 30, - --------------------------------------------------------------------------------------------------------------------- Percent Percent 2000 1999 Change 2000 1999 Change - --------------------------------------------------------------------------------------------------------------------- Service charges on deposit accounts $ 31.9 $ 29.6 7.8 % $ 63.4 $ 59.6 6.3 % Service and loan fee income 19.6 16.0 22.5 35.4 31.6 11.8 Insurance service fees 14.8 8.4 76.7 25.6 16.2 57.6 Trust income 13.7 12.8 6.6 27.5 24.8 10.9 Retail investment fees 10.8 10.6 2.0 23.5 20.8 13.4 Other 21.2 16.4 29.3 38.3 38.8 (1.1) - --------------------------------------------------------------------------------------------------------------------- Total non-interest operating income 112.0 93.8 19.4 213.7 191.8 11.4 Securities gains 2.8 2.1 31.9 2.8 2.3 23.2 - --------------------------------------------------------------------------------------------------------------------- Total non-interest income $ 114.8 $ 95.9 19.6 % $ 216.5 $194.1 11.6 % =====================================================================================================================
Service charges on deposit accounts increased $2.3 million, or 7.8 percent, for the three months ended June 30, 2000, compared with 1999 and increased $3.8 million, or 6.3 percent, for the six months then ended, compared with the same period a year ago. This was primarily due to growth in demand deposits and increased volume of insufficient fund fees. Partially offsetting these favorable factors were lower minimum balance requirements on regular checking accounts, savings accounts, and certificates of deposit resulting in lower monthly maintenance fees. These lower minimum balance requirements were instituted in April 1999. Service and loan fee income increased $3.6 million, or 22.5 percent, for the quarter ended June 30, 2000, compared with 1999, and increased $3.7 million, or 11.8 percent, for the six months ended, compared with the same period a year ago. The increases were primarily due to increased volume of commercial loan and credit card fees, partially offset by a decline in mortgage origination and mortgage servicing income. Insurance service fees increased $6.4 million, or 76.7 percent, for the quarter ended June 30, 2000, compared to the same period a year ago and increased $9.4 million, or 57.6 percent, for the six months ended June 30, 2000, compared with the same period a year ago. The increases were primarily due to the acquisition of Meeker Sharkey Financial Group. In addition, fees from core insurance business also experienced growth. Trust income increased $0.8 million, or 6.6 percent, for the quarter ended June 30, 2000, compared with 1999 and increased $2.7 million, or 10.9 percent, for the six months then ended, compared with the same period a year ago. This was generally due to an increase in investment advisory fees, including advisory fees from the Pillar Funds, Summit Bancorp's proprietary mutual funds. Retail investment fees increased $0.2 million, or 2.0 percent, for the quarter ended June 30, 2000, compared with 1999 and increased $2.8 million, or 13.4 percent, for the six months ended June 30, 2000, compared with the same period a year ago. This growth was a result of increased brokerage fees resulting from higher trading volumes, as well as increased fees from the sale of annuities. Other income, which primarily consists of ATM fees, international fees, other fees, and gains on sales of assets, increased $4.8 million, or 29.3 percent, for the three months ended June 30, 2000, compared with 1999 and decreased $0.4 million, or 1.1 percent, for the six months ended June 30, 2000, compared with the same period a year ago. The increase for the three months ended June 30, 2000 was attributable to the sale of $157.0 million in residential mortgages, which generated a gain of $3.5 million. The decrease for the six month period ended June 30, 2000, is primarily due to a net gain of $5.9 million from the sale of a $33.0 million credit card portfolio, which occurred in the first quarter of 1999. 16 Non-interest Expense Non-interest expense categories for the three and six month periods ended June 30, 2000, and 1999 are shown in the following table:
- ------------------------------------------------------------------------------------------------------------------------ (In millions) Three Months Ended June 30, Six Months Ended June 30, - ------------------------------------------------------------------------------------------------------------------------ Percent Percent 2000 1999 Change 2000 1999 Change - ------------------------------------------------------------------------------------------------------------------------ Salaries $ 93.4 $ 82.6 13.1 % $ 181.4 $ 162.9 11.3 % Pension and other employee benefits 32.3 29.1 10.8 62.6 59.1 5.8 Furniture and equipment 25.5 22.5 13.2 51.0 45.0 13.3 Occupancy, net 21.4 19.3 11.1 43.5 39.1 11.3 Amortization of goodwill and other 9.9 6.5 53.2 18.9 12.4 53.3 Communications 9.4 9.7 (3.0) 18.9 19.3 (2.0) Advertising and Public Relations 6.2 5.9 4.5 12.3 11.5 7.7 Other 39.0 31.6 23.4 77.4 63.4 22.0 - ------------------------------------------------------------------------------------------------------------------------ Total non-interest expense $ 237.1 $ 207.2 14.4 % $ 466.0 $ 412.7 12.9 % ========================================================================================================================
Salaries and benefits increased $14.0 million, or 12.5 percent, for the quarter ended June 30, 2000, compared to the same quarter in 1999 and $21.9 million, or 9.9 percent for the six months ended June 30, 2000, compared with the same period a year ago. In addition to the annual merit increases, salaries and benefits rose approximately $7.6 million from acquisitions for the three months ended June 30, 2000, and $13.0 million for the six-month period then ended. Partially offsetting these increases was the benefit of the fourth quarter 1999 corporate realignment which resulted in a reduction of approximately 260 employees. The increase is primarily a result of acquisitions (NMBT Corp., Prime Bancorp and Meeker Sharkey Financial Group) partially offset by the decline due to the corporate realignment. Furniture and equipment expenses increased $3.0 million, or 13.2 percent, for the quarter ended June 30, 2000, compared with the same quarter in 1999 and $6.0 million, or 13.3 percent, for the six months ended June 30, 2000, compared with the same period a year ago. This increase was primarily due to the recent bank acquisitions and increased amortization expense relating to computer equipment and software. Occupancy expense increased $2.1 million, or 11.1 percent, for the quarter ended June 30, 2000, compared with the same quarter in 1999 and $4.4 million, or 11.3 percent, for the six months ended June 30, 2000, compared with the same period a year ago. The increase was largely a result of recent bank acquisitions. Amortization of goodwill and intangibles increased $3.4 million, or 53.2 percent, for the three months ended June 30, 2000, compared to the same period a year ago and $6.6 million, or 53.3 percent, for the six months ended June 30, 2000, compared with the same period a year ago. The increase was due to the purchase acquisitions of Prime Bancorp, New Canaan Bank & Trust Company, Meeker Sharkey Financial Group, and NMBT. Other expenses increased $7.4 million, or 23.4 percent, for the three months ended June 30, 2000, compared with the same quarter in 1999 and $14.0 million, or 22.0 percent, for the six months ended June 30, 2000, compared with the same period a year ago. This was a result of increased consultant fees, increased second mortgage servicing fees resulting from home equity purchases, an increase in commissions due to increased sales of insurance and retail investment products, and an increase in charge offs. Also contributing to the increase were higher employment agency fees due to a tight labor market and recent bank acquisitions. Included in other expenses were legal and professional fees of $10.7 million for the three month period ended June 30, 2000, compared to $9.0 million for the same quarter in 1999. The effective income tax rate was 34.0 percent for the three months ended June 30, 2000, compared with 33.4 percent for the same quarter in 1999 and 33.9 percent for the six months ended June 30, 2000, compared with 34.0 percent for the same period a year ago. 17 LINES OF BUSINESS For management purposes, Summit Bancorp is segmented into the following lines of business: Retail Banking, Corporate Banking and The Private Bank. Activities not included in these lines are reflected in Other. The lines have been structured according to the customer groups served. Financial performance of business lines is monitored with an internal profitability measurement system. Line of business information is based on management accounting practices that conform to and support the current management structure and is not necessarily comparable with similar information from any other financial institution. The profitability measurement system uses internal management accounting policies that ensure business line results reflect the underlying economics of each business line and are compiled on a consistent basis. Net income includes revenues and expenses directly associated with each line in addition to allocations of revenue earned and expenses incurred by support units such as operations and technology. Centrally provided corporate services and general overhead are allocated on a per-unit cost basis or on an "ability to pay" basis related to each particular business line's contribution to income. A matched maturity funds transfer pricing methodology is employed to assign a cost of funds to the earning assets, as well as a value of funds to the liabilities of each business line. The provision for loan losses is allocated based on management's assessment of the historical net charge off ratio for each business segment. Income taxes are allocated based upon the consolidated effective tax rates, after consideration of certain permanent differences that may be allocated to a specific line of business. The following tables summarize results by lines of business as if operated on a stand-alone basis for the three months and six months ended June 30, 2000 and 1999. Certain prior period information has been restated to conform with the current period presentation.
Results of Operations Quarter Ended June 30, Retail Banking Corporate Banking The Private Bank Other Consolidated --------------------------------------------------------------------------------------------- (In millions) 2000 1999 2000 1999 2000 1999 2000 1999 2000 1999 - ------------------------------------------------------------------------------------------------------------------------------ Net interest income $213 $203 $84 $68 $17 $15 $30 $23 $344 $309 Provision for loan losses 7 9 18 7 -- 1 -- -- 25 17 --------------------------------------------------------------------------------------------- Net interest income after provision for loan losses 206 194 66 61 17 14 30 23 319 292 Non-interest income 54 50 18 12 40 32 3 2 115 96 Non-interest expense 145 134 42 34 40 34 10 5 237 207 --------------------------------------------------------------------------------------------- Income before taxes 115 110 42 39 17 12 23 20 197 181 Federal and state income 39 37 14 12 6 4 8 8 67 61 --------------------------------------------------------------------------------------------- Net income $76 $73 $28 $27 $11 $8 $15 $12 $130 $120 ============================================================================================= Selected Average Balances: Securities $ -- $55 $19 $-- $25 $11 $11,410 $10,486 $11,454 $10,552 Loans 12,942 11,596 9,990 8,384 1,538 1,272 -- 17 24,470 21,269 Assets 13,312 11,963 9,997 8,362 1,674 1,364 13,312 11,988 38,295 33,677 Deposits 22,680 20,668 1,133 1,007 900 770 844 843 25,557 23,288
18
Results of Operations Six Months Ended June 30, Retail Banking Corporate Banking The Private Bank Other Consolidated ---------------------------------------------------------------------------------------------- (In millions) 2000 1999 2000 1999 2000 1999 2000 1999 2000 1999 ---------------------------------------------------------------------------------------------- Net interest income $424 $402 $161 $135 $32 $29 $63 $48 $680 $614 Provision for loan losses 15 19 29 13 1 1 -- -- 45 33 ---------------------------------------------------------------------------------------------- Net interest income after provision for loan losses 409 383 132 122 31 28 63 48 635 581 Non-interest income 103 105 34 24 77 62 3 3 217 194 Non-interest expense 285 267 85 68 75 65 21 13 466 413 ---------------------------------------------------------------------------------------------- Income before taxes 227 221 81 78 33 25 45 38 386 362 Federal and state income taxes 78 76 26 25 11 8 16 14 131 123 ---------------------------------------------------------------------------------------------- Net income $149 $145 $55 $53 $22 $17 $29 $24 $255 $239 ============================================================================================== Selected Average Balances: Securities $-- $55 $15 $-- $20 $11 $11,339 $10,308 $11,374 $10,374 Loans 12,702 11,708 9,745 8,246 1,506 1,253 -- 11 23,953 21,218 Assets 13,073 12,076 9,748 8,227 1,626 1,343 13,130 11,773 37,577 33,419 Deposits 22,182 20,331 1,139 1,005 868 753 879 982 25,068 23,071
Retail Banking Retail Banking sells and delivers retail banking products and services to individuals and small businesses through more than 400 traditional and approximately 80 supermarket branches in New Jersey, eastern Pennsylvania, and Connecticut. In addition to traditional banking services, Retail Banking offers its customers an expanding array of 24-hour banking services through approximately 600 automated teller machines, telephone banking centers, and the Internet. It also includes a broad selection of small business and consumer loans, deposit products, and a complete range of full-service mortgage banking activities. Average loans for the three months ended June 30, 2000, increased $1.3 billion, or 11.6 percent, to $12.9 billion from the same period in 1999, primarily due to home equity loan purchases and increases in the utilization of home equity credit lines. Total average deposits for the second quarter of 2000 increased to $22.7 billion, up $2.0 billion from a year ago. This increase was attributable to the growth in the Summit Navigator Account and retail certificates of deposit. Net interest income for the quarter increased $10 million, or 4.9 percent, over last year, primarily due to loan growth. The increase in non-interest income of $4 million is primarily attributable to loan and deposit fee income. Non-interest expenses for the quarter increased $11 million, or 8.2 percent, over last year, primary due to salaries, other expenses, and acquisitions. Net income for the quarter was $76 million, an increase of $3 million, or 4.1 percent, from the prior year. Corporate Banking Corporate Banking provides a full array of commercial financial services, including asset-based lending, international trade services, equipment leasing, real estate financing, private placement, mezzanine financing, aircraft lending, correspondent banking, treasury services, and structured finance. Demand and interest-bearing deposit accounts and services are provided through the branch network. Total average loans for the quarter ended June 30, 2000, were $10.0 billion, an increase of $1.6 billion, or 19.2 percent, over the same period in 1999 primarily in commercial and industrial, syndicated loans and the food, media and large corporate portfolios. Net interest income for the second quarter of 2000 increased $16 million, or 23.5 percent, from 1999, driven primarily by the increase in average loans. Partially offsetting the loan increase was an $11 million increase in the provision for loan losses. This was attributed to the increase in the level of charge offs and loan growth. Non-interest income for the quarter ended June 30, 2000, increased $6 million, or 50.0 percent, from the prior year due to an increase in loan and deposit fee income as well as additional capital market fee 19 income. Non-interest expense increased $8 million over the prior year to $42 million due to higher salaries and benefits expense. Net income was $28 million for the three months ended June 30, 2000, an increase of $1 million, or 3.7 percent, from the same period a year ago. The Private Bank The Private Bank provides personal credit services, professional services for lawyers and accountants as well as their firms, and business loans and lines of credit. This segment also includes investment services that provide a full range of trust, administrative, and custodial services to individuals and institutions, in addition to investment products and discount brokerage. In addition, the line markets a wide variety of insurance products for the personal and corporate marketplace. Net interest income for the quarter increased $3 million, or 37.5 percent, from 1999 primarily due to higher loan volumes. Non-interest income increased $8 million, or 25.0 percent, from the same period a year ago. This was primarily due to a $5.7 million, or 68.2 percent, increase in insurance service fees, a $0.9 million, or 8.4 percent, increase in retail investment fees, and a $0.8 million, or 6.6 percent, increase in trust income. The acquisition of the Meeker Sharkey Financial Group contributed $5.7 million of insurance income for the quarter. In addition, the growth in retail investment fees were primarily due to increased brokerage fees resulting from higher trading volumes as well as increased fees from sales of annuity products. The $6 million, or 17.7 percent, increase in expenses is due to increases in salaries and commissions related to the increased sale of trust, retail investment, and insurance products. Net income for the quarter was $11 million, up $3 million, or 37.5 percent, from a year ago. Other Other includes the treasury function which is responsible for managing interest rate risk and the investment portfolios. In addition, certain revenues and expenses not considered allocable to a line of business are reflected in this area. Net interest income increased $7 million, or 30.4 percent, from 1999, primarily due to growth in the securities portfolio. Securities averaged $11.4 billion for the second quarter of 2000, up $0.9 million, or 8.8 percent, from the prior year. Net income was up for the quarter $3 million, or 25.0 percent, to $15 million when compared to the same quarter the prior year. LIQUIDITY Liquidity is the ability to support asset growth while satisfying the borrowing needs and deposit withdrawal requirements of customers. Traditional sources of liquidity include asset maturities, asset repayments, and deposit growth. In addition, borrowed funds represent another major source of funding. The bank subsidiaries have established borrowing relationships with the FHLB and other correspondent banks which further support and enhance liquidity. Summit Bank, NJ and Summit Bank, PA executed a distribution agreement in November 1998, providing for the possible issuance of senior and subordinated notes to a maximum of $3.75 billion on an underwritten or agency basis. Through June 30, 2000, no funds have been drawn from this source. Liquidity is also important at the Parent Corporation in order to provide funds for operations and to pay dividends to shareholders. Parent Corporation cash requirements are met primarily through management fees and dividends from its subsidiaries and the issuance of short and long-term debt. The amount of dividends that can be assessed to the bank subsidiaries is subject to certain regulatory restrictions. Lines of credit are available at the Parent Corporation to support commercial paper borrowings and for general corporate purposes. Interest on these lines of credit approximates the prime lending rate at the time of borrowing. Unused lines amounted to $33.0 million at June 30, 2000. During 1999, a shelf registration statement providing for the possible issuance, from time to time, of senior and subordinated debt securities and preferred stock to a maximum of $1.0 billion was declared effective by the Securities and Exchange Commission. Terms of the securities will be set at the time of issuance. As of June 30, 2000, none of this debt or preferred stock had been issued. Liquidity management includes monitoring current and projected cash flows, as well as economic forecasts for the industry. A liquidity contingency plan is in place which is designed to effectively manage potential liquidity concerns due to changes in interest rates, credit markets, or other external risks. 20 The Consolidated Statements of Cash Flows present the change in cash and due from banks from operating, investing and financing activities. During the first six months of 2000, net cash provided by operating activities totaled $262.9 million. Contributing to net cash provided by operating activities were the results of operations, plus noncash expenses, and proceeds from the sales of mortgages held for sale. Partially offsetting the contributions to operating cash were funds used to originate mortgage loans held for sale and noncash revenues. Net cash used in investing activities totaled $2.2 billion. For the six months ended June 30, 2000, net cash used in transactions involving the investment portfolios totaled $0.4 million, while the loan portfolio used net cash of $1.6 million. Scheduled maturities and anticipated principal repayments of the available for sale and held to maturity securities portfolios will approximate $886.1 million throughout the balance of 2000. In addition, all or part of the remaining securities available for sale could be sold, providing another source of liquidity. These sources can also be used to meet the funding needs during periods of loan growth. Net cash provided by financing activities totaled $1.9 billion. During the first six months of 2000, other borrowed funds and long-term debt increased $1.0 billion and deposits increased $1.1 billion. These increases were partially offset by the payment of common stock dividends and the purchase of Summit Bancorp's common stock. LOOKING AHEAD This report contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader to understand anticipated future financial performance. These forward-looking statements involve certain risks, uncertainties, estimates and assumptions made by management. One of Summit Bancorp's primary objectives is to achieve balanced asset and revenue growth, and at the same time expand market presence and diversify the line of financial products. However, it is recognized that objectives, no matter how focused, are subject to factors beyond the control of Summit Bancorp which can impede our ability to achieve these goals. Factors that may cause actual results to differ from those results expressed or implied include, but are not limited to, the interest rate environment and the overall economy, the ability of customers to repay their obligations, the adequacy of the allowance for loan losses, including realizable collateral valuations, charge offs and recoveries, the progress of integrating acquired financial institutions, competition and technological changes. Although management has taken certain steps to mitigate any negative effect of the above mentioned items, significant unfavorable changes could severely impact the assumptions used and have an adverse affect on profitability. 21 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Due to the nature of Summit Bancorp's business, market risk is primarily limited to its exposure to interest rate risk, which is the impact that changes in interest rates would have on future earnings. The principal objective in managing interest rate risk is to maximize net interest income within the acceptable levels of risk established by policy. This risk can be reduced by various strategies, including the administration of liability costs, the reinvestment of asset maturities and the use of off-balance sheet financial instruments. Interest rate risk is monitored through the use of simulation modeling techniques which apply alternative interest rate scenarios to periodic forecasts of future business activity and estimate the related impact to net interest income. The use of simulation modeling assists management in its continuing efforts to achieve earnings growth in varying interest rate environments. Key assumptions in the model include anticipated prepayments on mortgage-related instruments, contractual cash flows and maturities of all financial instruments including derivatives, anticipated future business activity, deposit sensitivity, and changes in market conditions. Selected core deposit rates have not been changed based on the results of analysis of historical rate movements. These assumptions are inherently uncertain and, as a result, these models cannot precisely estimate the impact that higher or lower rate environments will have on net interest income. Actual results will differ from simulated results due to the timing, magnitude, and frequency of interest rate changes, changes in cash flow patterns and market conditions, as well as changes in management's strategies. Based on the results of the interest simulation model, as of June 30, 2000, Summit Bancorp would expect a decrease of approximately $81.3 million in net interest income and an increase of approximately $71.1 million in net interest income if interest rates increase or decrease by 100 basis points, respectively, from current interest rates in an immediate and parallel shock over a twelve-month period. At December 31, 1999, Summit Bancorp expected a decrease of $66.5 million in net interest income and an increase of $74.2 million in net interest income if interest rates increased or decreased by 100 basis points, respectively. The interest simulation model does not include asset and liability strategies that could be deployed to mitigate the impact of changes in the interest rate environment. Interest rate risk management efforts also involve the use of certain derivative financial instruments, primarily interest rate swaps, for the purpose of stabilizing net interest income in a changing interest rate environment. At June 30, 2000, the notional values of these instruments totaled $205.0 million. These derivatives resulted in a reduction in net interest income of $0.4 million for the first six months of 2000. The cost to terminate these contracts at June 30, 2000, would have been $0.6 million. Summit Bancorp has limited risks associated with foreign currencies, commodities or other marketable instruments. 22 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS Based upon advice of Summit's attorneys, management does not believe that the ultimate disposition of the litigation discussed below will have a material adverse effect on the financial position and results of operation of the company and its subsidiaries, taken as a whole. 5. John Baker, Margaret Baker, Elaine Coopersmith, and Arnold Coopersmith on behalf of themselves and all others similarly situated v. Summit Bank, United States District Court for the Eastern District of Pennsylvania, Civil Action No. CV-2010, filed April 21, 1999. Last reported on Form 10-K for the period ended December 31, 1999. Plaintiffs have furnished expert reports addressing the issues of Summit Bank PA, a subsidiary of Summit Bancorp, liability and damages allegedly sustained by the class members. Plaintiff's damages expert has opined that the loss allegedly sustained by the class is $32.5 million, including principal and interest. Summit Bank PA is vigorously defending this case and has retained its own experts to address the plaintiff's expert reports. ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS. Not applicable. ITEM 3. DEFAULTS UPON SENIOR SECURITIES. Not applicable. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. Not applicable. ITEM 5. OTHER INFORMATION. Not applicable. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits (27) Summit Bancorp. Financial Data Schedule - June 30, 2000. (b) Reports on Form 8-K Not applicable. 23 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. SUMMIT BANCORP Registrant DATE: August 14, 2000 by: /s/ PAUL V. STAHLIN PAUL V. STAHLIN Senior Vice President, Comptroller and Principal Accounting Officer (Duly Authorized Officer) 24 EXHIBIT INDEX Exhibit No. Description (27) Summit Bancorp. Financial Data Schedule - June 30, 2000. 25 EX-27 2 0002.txt
9 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE JUNE 30, 2000 10-Q FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1000 6-MOS Dec-31-2000 Jun-30-2000 1,192,496 26,845 0 26,554 6,226,991 5,030,416 4,807,496 25,047,838 334,851 38,985,132 26,076,925 5,883,846 468,502 3,616,616 0 0 141,819 2,797,424 38,985,132 970,643 371,332 1,636 1,343,611 397,204 663,822 679,789 44,500 2,846 465,967 385,823 255,105 0 0 255,105 1.46 1.46 3.89 119,920 46,607 0 46,652 328,828 54,328 11,494 334,851 200,789 0 134,062
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