CFS BANCORP, INC. |
(Exact Name of Registrant as Specified in Its Charter) |
INDIANA |
(State or Other Jurisdiction of Incorporation) |
000-24611 | 35-2042093 | |
(Commission File Number) | (IRS Employer Identification No.) |
707 Ridge Road, Munster, Indiana | 46321 | |
(Address of Principal Executive Offices) | (Zip Code) | |
(219) 836-5500 | ||
(Registrant’s Telephone Number, Including Area Code) | ||
Not Applicable | ||
(Former Name or Former Address, if Changed Since Last Report) |
x | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit Number | Description |
Press release dated July 30, 2013 |
CFS BANCORP, INC. | ||
Date: July 30, 2013 | By: | /s/ Joyce M. Fabisiak |
Joyce M. Fabisiak | ||
Vice President - Finance & Accounting | ||
CONTACT: | Daryl D. Pomranke, President and Chief Executive Officer 219-513-5150 |
w | Merger-related expenses totaled $971,000 for the second quarter of 2013, which were primarily legal and investment banking fees for services rendered in connection with the merger with First Merchants Corporation announced in May 2013 and the preparation and review of the required regulatory filings; |
w | Non-performing assets were stable at $48.6 million at June 30, 2013 compared to $48.7 million at March 31, 2013 and decreased $22.5 million, or 31.7%, from $71.1 million at June 30, 2012; |
w | Non-performing loans increased $1.6 million, or 6.5%, to $26.7 million at June 30, 2013 from $25.0 million at March 31, 2013 and decreased $25.2 million, or 48.6%, from $51.9 million at June 30, 2012; |
w | Loans receivable totaled $660.1 million at June 30, 2013, a decrease of $4.2 million, or .6%, from March 31, 2013 and $53.5 million, or 7.5%, from June 30, 2012; |
w | Provision for loan losses increased to $1.1 million for the second quarter of 2013 from $510,000 for the first quarter of 2013 and decreased from $1.2 million for the second quarter of 2012; |
w | Net charge-offs for the second quarter of 2013 totaled $440,000, a decrease from $671,000 for the first quarter of 2013 and $856,000 for the second quarter of 2012; |
w | Core deposits increased to 68.3% of total deposits at June 30, 2013 compared to 66.8% of total deposits at March 31, 2013 and 62.5% at June 30, 2012; |
w | Net interest margin decreased to 3.21% during the second quarter of 2013 from 3.23% in the first quarter of 2013 and 3.42% in the second quarter of 2012; and |
w | The Bank’s Tier 1 core capital ratio was 9.08% at June 30, 2013, an increase from 8.92% at March 31, 2013 and 8.56% at June 30, 2012; the Bank’s total risk-based capital ratio increased to 15.31% from 14.86% at March 31, 2013 and 13.35% at June 30, 2012. |
Three Months Ended | |||||||||||
June 30, 2013 | March 31, 2013 | June 30, 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Net interest margin | 3.21 | % | 3.23 | % | 3.42 | % | |||||
Interest rate spread | 3.15 | 3.17 | 3.35 | ||||||||
Net interest income | $ | 8,233 | $ | 8,201 | $ | 8,944 | |||||
Average assets: | |||||||||||
Yield on interest-earning assets | 3.65 | % | 3.71 | % | 4.03 | % | |||||
Yield on loans receivable | 4.53 | 4.62 | 4.70 | ||||||||
Yield on investment securities | 2.78 | 2.78 | 3.42 | ||||||||
Average interest-earning assets | $ | 1,027,146 | $ | 1,030,232 | $ | 1,052,039 | |||||
Average liabilities: | |||||||||||
Cost of interest-bearing liabilities | .50 | % | .54 | % | .68 | % | |||||
Cost of interest-bearing deposits | .39 | .44 | .58 | ||||||||
Cost of borrowed funds | 2.28 | 2.26 | 2.30 | ||||||||
Average interest-bearing liabilities | $ | 902,564 | $ | 908,356 | $ | 941,398 |
June 30, 2013 | March 31, 2013 | June 30, 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Non-performing loans (NPLs) | $ | 26,674 | $ | 25,048 | $ | 51,850 | |||||
Other real estate owned | 21,878 | 23,698 | 19,223 | ||||||||
Non-performing assets (NPAs) | $ | 48,552 | $ | 48,746 | $ | 71,073 | |||||
Allowance for loan losses (ALL) | $ | 12,660 | $ | 12,024 | $ | 12,062 | |||||
Provision for loan losses for the quarter ended | 1,076 | 510 | 1,150 | ||||||||
Loan charge-offs (recoveries): | |||||||||||
Gross loan charge-offs | $ | 1,569 | $ | 878 | $ | 892 | |||||
Recoveries | (1,129 | ) | (207 | ) | (36 | ) | |||||
Net charge-offs for the quarter ended | $ | 440 | $ | 671 | $ | 856 | |||||
NPLs / total loans | 4.04 | % | 3.77 | % | 7.27 | % | |||||
NPAs / total assets | 4.29 | 4.25 | 6.28 | ||||||||
ALL / total loans | 1.92 | 1.81 | 1.69 | ||||||||
ALL / NPLs | 47.46 | 48.00 | 23.26 |
June 30, 2013 | March 31, 2013 | June 30, 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Assets: | |||||||||||
Total assets | $ | 1,131,548 | $ | 1,146,368 | $ | 1,132,094 | |||||
Interest-earning deposits with banks | 132,929 | 133,766 | 51,687 | ||||||||
Investment securities | 232,915 | 235,177 | 240,590 | ||||||||
Loans receivable, net of unearned fees | 660,072 | 664,308 | 713,596 | ||||||||
Liabilities and Equity: | |||||||||||
Total liabilities | $ | 1,020,336 | $ | 1,033,591 | $ | 1,027,497 | |||||
Deposits | 961,945 | 974,328 | 967,154 | ||||||||
Borrowed funds | 49,306 | 49,828 | 51,306 | ||||||||
Shareholders’ equity | 111,212 | 112,777 | 104,597 |
June 30, 2013 | March 31, 2013 | June 30, 2012 | ||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Commercial loans: | ||||||||||||||||||||
Commercial and industrial | $ | 95,675 | 14.5 | % | $ | 91,649 | 13.8 | % | $ | 89,479 | 12.6 | % | ||||||||
Commercial real estate - owner occupied | 97,906 | 14.8 | 99,030 | 14.9 | 102,149 | 14.3 | ||||||||||||||
Commercial real estate - non-owner occupied | 157,517 | 23.9 | 159,414 | 24.0 | 184,284 | 25.8 | ||||||||||||||
Commercial real estate - multifamily | 72,806 | 11.0 | 71,630 | 10.8 | 76,647 | 10.7 | ||||||||||||||
Commercial construction and land development | 14,166 | 2.1 | 15,335 | 2.3 | 23,353 | 3.3 | ||||||||||||||
Commercial participations | 3,661 | .6 | 5,137 | .8 | 6,453 | .9 | ||||||||||||||
Total commercial loans | 441,731 | 66.9 | 442,195 | 66.6 | 482,365 | 67.6 | ||||||||||||||
Retail loans: | ||||||||||||||||||||
One-to-four family residential | 170,879 | 25.9 | 172,540 | 25.9 | 177,830 | 24.9 | ||||||||||||||
Home equity lines of credit | 44,026 | 6.7 | 45,616 | 6.9 | 49,476 | 6.9 | ||||||||||||||
Retail construction and land development | 913 | .1 | 1,370 | .2 | 1,518 | .2 | ||||||||||||||
Other | 3,232 | .5 | 3,025 | .5 | 2,724 | .5 | ||||||||||||||
Total retail loans | 219,050 | 33.2 | 222,551 | 33.5 | 231,548 | 32.5 | ||||||||||||||
Total loans receivable | 660,781 | 100.1 | 664,746 | 100.1 | 713,913 | 100.1 | ||||||||||||||
Net deferred loan fees | (709 | ) | (.1 | ) | (438 | ) | (.1 | ) | (317 | ) | (.1 | ) | ||||||||
Total loans receivable, net of unearned fees | $ | 660,072 | 100.0 | % | $ | 664,308 | 100.0 | % | $ | 713,596 | 100.0 | % |
June 30, 2013 | March 31, 2013 | June 30, 2012 | ||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Checking accounts: | ||||||||||||||||||||
Non-interest bearing | $ | 110,724 | 11.5 | % | $ | 114,897 | 11.8 | % | $ | 97,435 | 10.1 | % | ||||||||
Interest-bearing | 202,399 | 21.0 | 192,051 | 19.7 | 179,842 | 18.5 | ||||||||||||||
Money market accounts | 181,484 | 18.9 | 183,766 | 18.9 | 182,522 | 18.9 | ||||||||||||||
Savings accounts | 162,707 | 16.9 | 159,633 | 16.4 | 144,705 | 15.0 | ||||||||||||||
Core deposits | 657,314 | 68.3 | 650,347 | 66.8 | 604,504 | 62.5 | ||||||||||||||
Certificates of deposit accounts | 304,631 | 31.7 | 323,981 | 33.2 | 362,650 | 37.5 | ||||||||||||||
Total deposits | $ | 961,945 | 100.0 | % | $ | 974,328 | 100.0 | % | $ | 967,154 | 100.0 | % |
June 30, 2013 | March 31, 2013 | June 30, 2012 | |||||||||
(Dollars in thousands) | |||||||||||
Short-term variable-rate repurchase agreements | $ | 9,903 | $ | 10,377 | $ | 11,540 | |||||
FHLB advances | 39,403 | 39,451 | 39,766 | ||||||||
Total borrowed funds | $ | 49,306 | $ | 49,828 | $ | 51,306 |
CFS BANCORP, INC. | ||||||||||||||||||||
Consolidated Statements of Income (Unaudited) | ||||||||||||||||||||
(Dollars in thousands, except per share data) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, 2013 | March 31, 2013 | June 30, 2012 | June 30, 2013 | June 30, 2012 | ||||||||||||||||
Interest income: | ||||||||||||||||||||
Loans receivable | $ | 7,495 | $ | 7,700 | $ | 8,243 | $ | 15,195 | $ | 16,629 | ||||||||||
Investment securities | 1,731 | 1,593 | 2,186 | 3,324 | 4,316 | |||||||||||||||
Other interest-earning assets | 121 | 124 | 103 | 245 | 196 | |||||||||||||||
Total interest income | 9,347 | 9,417 | 10,532 | 18,764 | 21,141 | |||||||||||||||
Interest expense: | ||||||||||||||||||||
Deposits | 828 | 931 | 1,294 | 1,759 | 2,684 | |||||||||||||||
Borrowed funds | 286 | 285 | 294 | 571 | 590 | |||||||||||||||
Total interest expense | 1,114 | 1,216 | 1,588 | 2,330 | 3,274 | |||||||||||||||
Net interest income | 8,233 | 8,201 | 8,944 | 16,434 | 17,867 | |||||||||||||||
Provision for loan losses | 1,076 | 510 | 1,150 | 1,586 | 2,200 | |||||||||||||||
Net interest income after provision for loan losses | 7,157 | 7,691 | 7,794 | 14,848 | 15,667 | |||||||||||||||
Non-interest income: | ||||||||||||||||||||
Deposit related fees | 1,648 | 1,520 | 1,578 | 3,168 | 3,047 | |||||||||||||||
Net gain (loss) on sale of: | ||||||||||||||||||||
Investment securities | 192 | 184 | 305 | 376 | 723 | |||||||||||||||
Loans held for sale | 106 | 463 | 200 | 569 | 359 | |||||||||||||||
Other real estate owned | (542 | ) | 10 | 86 | (532 | ) | 39 | |||||||||||||
Income from bank-owned life insurance | 134 | 330 | 162 | 464 | 702 | |||||||||||||||
Other income | 268 | 347 | 312 | 615 | 597 | |||||||||||||||
Total non-interest income | 1,806 | 2,854 | 2,643 | 4,660 | 5,467 | |||||||||||||||
Non-interest expense: | ||||||||||||||||||||
Compensation and employee benefits | 4,418 | 4,370 | 4,467 | 8,788 | 9,180 | |||||||||||||||
Professional fees | 1,141 | 328 | 198 | 1,469 | 451 | |||||||||||||||
Net occupancy expense | 625 | 694 | 679 | 1,319 | 1,387 | |||||||||||||||
Data processing | 544 | 513 | 445 | 1,057 | 883 | |||||||||||||||
FDIC insurance premiums and regulatory assessments | 479 | 481 | 490 | 960 | 978 | |||||||||||||||
Furniture and equipment expense | 398 | 403 | 468 | 801 | 925 | |||||||||||||||
Marketing | 315 | 269 | 322 | 584 | 726 | |||||||||||||||
Other real estate owned related expense, net | 114 | 250 | 316 | 364 | 934 | |||||||||||||||
Loan collection expense | 248 | 133 | 119 | 381 | 237 | |||||||||||||||
Severance and retirement compensation expense | — | — | — | — | 876 | |||||||||||||||
Other general and administrative expenses | 1,182 | 1,014 | 1,038 | 2,196 | 2,172 | |||||||||||||||
Total non-interest expense | 9,464 | 8,455 | 8,542 | 17,919 | 18,749 | |||||||||||||||
Income (loss) before income taxes | (501 | ) | 2,090 | 1,895 | 1,589 | 2,385 | ||||||||||||||
Income tax expense (benefit) | (334 | ) | 588 | 541 | 254 | 541 | ||||||||||||||
Net income (loss) | $ | (167 | ) | $ | 1,502 | $ | 1,354 | $ | 1,335 | $ | 1,844 | |||||||||
Basic earnings (loss) per share | $ | (.02 | ) | $ | .14 | $ | .13 | $ | .12 | $ | .17 | |||||||||
Diluted earnings (loss) per share | (.02 | ) | .14 | .13 | .12 | .17 | ||||||||||||||
Weighted-average common and common share equivalents outstanding: | ||||||||||||||||||||
Basic | 10,790,267 | 10,739,160 | 10,750,313 | 10,764,855 | 10,724,103 | |||||||||||||||
Diluted | 10,869,069 | 10,810,800 | 10,806,555 | 10,840,096 | 10,776,476 |
CFS BANCORP, INC. | ||||||||||||||||
Consolidated Statements of Condition (Unaudited) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
June 30, 2013 | March 31, 2013 | December 31, 2012 | June 30, 2012 | |||||||||||||
ASSETS | ||||||||||||||||
Cash and amounts due from depository institutions | $ | 16,697 | $ | 20,474 | $ | 20,577 | $ | 33,846 | ||||||||
Interest-earning deposits with banks | 132,929 | 133,766 | 114,122 | 51,687 | ||||||||||||
Cash and cash equivalents | 149,626 | 154,240 | 134,699 | 85,533 | ||||||||||||
Investment securities available-for-sale, at fair value | 219,931 | 220,196 | 203,290 | 226,625 | ||||||||||||
Investment securities held-to-maturity, at cost | 12,984 | 14,981 | 15,458 | 13,965 | ||||||||||||
Loans receivable, net of deferred fees | 660,072 | 664,308 | 692,267 | 713,596 | ||||||||||||
Allowance for loan losses | (12,660 | ) | (12,024 | ) | (12,185 | ) | (12,062 | ) | ||||||||
Net loans | 647,412 | 652,284 | 680,082 | 701,534 | ||||||||||||
Loans held for sale | 1,620 | 955 | 1,509 | 610 | ||||||||||||
Investment in Federal Home Loan Bank stock, at cost | 6,188 | 6,188 | 6,188 | 6,188 | ||||||||||||
Bank-owned life insurance | 36,367 | 36,233 | 36,604 | 36,435 | ||||||||||||
Accrued interest receivable | 2,470 | 2,669 | 2,528 | 2,801 | ||||||||||||
Other real estate owned | 21,878 | 23,698 | 23,347 | 19,223 | ||||||||||||
Office properties and equipment | 15,293 | 15,519 | 15,768 | 16,225 | ||||||||||||
Net deferred tax assets | 12,375 | 11,032 | 11,302 | 16,281 | ||||||||||||
Other assets | 5,404 | 8,373 | 7,334 | 6,674 | ||||||||||||
Total assets | $ | 1,131,548 | $ | 1,146,368 | $ | 1,138,109 | $ | 1,132,094 | ||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||
Deposits | $ | 961,945 | $ | 974,328 | $ | 965,791 | $ | 967,154 | ||||||||
Borrowed funds | 49,306 | 49,828 | 50,562 | 51,306 | ||||||||||||
Advance payments by borrowers for taxes and insurance | 4,322 | 4,542 | 4,734 | 4,243 | ||||||||||||
Other liabilities | 4,763 | 4,893 | 5,200 | 4,794 | ||||||||||||
Total liabilities | 1,020,336 | 1,033,591 | 1,026,287 | 1,027,497 | ||||||||||||
Shareholders’ equity: | ||||||||||||||||
Preferred stock, $0.01 par value; 15,000,000 shares authorized | — | — | — | — | ||||||||||||
Common stock, $0.01 par value; 85,000,000 shares authorized; 23,423,306 shares issued; 10,894,112, 10,898,168, 10,874,687, and 10,867,357 shares outstanding | 234 | 234 | 234 | 234 | ||||||||||||
Additional paid-in capital | 187,207 | 186,975 | 187,260 | 187,379 | ||||||||||||
Retained earnings | 78,033 | 78,310 | 76,914 | 74,420 | ||||||||||||
Treasury stock, at cost; 12,529,194, 12,525,138, 12,548,619, and 12,555,949 shares | (154,443 | ) | (154,411 | ) | (154,698 | ) | (154,824 | ) | ||||||||
Accumulated other comprehensive income (loss), net of tax | 181 | 1,669 | 2,112 | (2,612 | ) | |||||||||||
Total shareholders’ equity | 111,212 | 112,777 | 111,822 | 104,597 | ||||||||||||
Total liabilities and shareholders’ equity | $ | 1,131,548 | $ | 1,146,368 | $ | 1,138,109 | $ | 1,132,094 |
CFS BANCORP, INC. | ||||||||||||||||||
Selected Financial Data (Unaudited) | ||||||||||||||||||
(Dollars in thousands, except per share data) | ||||||||||||||||||
June 30, 2013 | March 31, 2013 | December 31, 2012 | June 30, 2012 | |||||||||||||||
Book value per share | $ | 10.21 | $ | 10.35 | $ | 10.28 | $ | 9.62 | ||||||||||
Shareholders’ equity to total assets | 9.83 | % | 9.84 | % | 9.83 | % | 9.24 | % | ||||||||||
Tier 1 core capital ratio (Bank only) | 9.08 | 8.92 | 8.81 | 8.56 | ||||||||||||||
Total risk-based capital ratio (Bank only) | 15.31 | 14.86 | 14.06 | 13.35 | ||||||||||||||
Common shares outstanding | 10,894,112 | 10,898,168 | 10,874,687 | 10,867,357 | ||||||||||||||
Employees (FTE) | 262 | 262 | 261 | 261 | ||||||||||||||
Number of full service banking centers | 20 | 20 | 20 | 20 |
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, 2013 | March 31, 2013 | June 30, 2012 | June 30, 2013 | June 30, 2012 | ||||||||||||||||
Average Balance Data: | ||||||||||||||||||||
Total assets | $ | 1,138,547 | $ | 1,141,032 | $ | 1,162,099 | $ | 1,139,996 | $ | 1,160,644 | ||||||||||
Loans receivable, net of unearned fees | 663,471 | 676,181 | 705,410 | 669,791 | 707,061 | |||||||||||||||
Investment securities | 246,277 | 229,120 | 252,698 | 237,746 | 255,789 | |||||||||||||||
Interest-earning assets | 1,027,146 | 1,030,232 | 1,052,039 | 1,028,681 | 1,048,907 | |||||||||||||||
Deposits | 965,033 | 966,670 | 996,741 | 965,961 | 993,514 | |||||||||||||||
Interest-bearing deposits | 852,892 | 857,838 | 890,814 | 855,352 | 889,728 | |||||||||||||||
Non-interest bearing deposits | 112,141 | 108,832 | 105,927 | 110,609 | 103,786 | |||||||||||||||
Interest-bearing liabilities | 902,564 | 908,356 | 941,398 | 905,445 | 941,599 | |||||||||||||||
Shareholders’ equity | 113,019 | 112,143 | 103,827 | 112,583 | 104,052 | |||||||||||||||
Performance Ratios (annualized): | ||||||||||||||||||||
Return on average assets | (.06 | )% | .53 | % | .47 | % | .24 | % | .32 | % | ||||||||||
Return on average equity | (.59 | ) | 5.43 | 5.25 | 2.39 | 3.56 | ||||||||||||||
Average yield on interest-earning assets | 3.65 | 3.71 | 4.03 | 3.68 | 4.05 | |||||||||||||||
Average cost of interest-bearing liabilities | .50 | .54 | .68 | .52 | .70 | |||||||||||||||
Interest rate spread | 3.15 | 3.17 | 3.35 | 3.16 | 3.35 | |||||||||||||||
Net interest margin | 3.21 | 3.23 | 3.42 | 3.22 | 3.43 | |||||||||||||||
Non-interest expense to average assets | 3.33 | 3.01 | 2.96 | 3.17 | 3.25 | |||||||||||||||
Efficiency ratio (1) | 96.11 | 77.78 | 75.71 | 86.49 | 82.92 | |||||||||||||||
Cash dividends declared per share | $ | .01 | $ | .01 | $ | — | $ | .02 | $ | .01 | ||||||||||
Market price per share of common stock for the period ended: | ||||||||||||||||||||
Close | $ | 10.72 | $ | 7.99 | $ | 4.98 | $ | 10.72 | $ | 4.98 | ||||||||||
High | 10.95 | 8.07 | 5.96 | 10.95 | 6.29 | |||||||||||||||
Low | 8.05 | 6.18 | 4.30 | 6.18 | 4.30 | |||||||||||||||
(1) The efficiency ratio is calculated by dividing non-interest expense by the sum of net interest income and non-interest income, excluding net gain on sales of investment securities. |
CFS BANCORP, INC. | ||||||||||||
Reconciliation of Income Before Income Taxes to Pre-Tax, Pre-Provision Earnings, as adjusted | ||||||||||||
(Unaudited) | ||||||||||||
(Dollars in thousands) | ||||||||||||
Three Months Ended | ||||||||||||
June 30, 2013 | March 31, 2013 | June 30, 2012 | ||||||||||
Income (loss) before income taxes | $ | (501 | ) | $ | 2,090 | $ | 1,895 | |||||
Provision for loan losses | 1,076 | 510 | 1,150 | |||||||||
Pre-tax, pre-provision earnings | 575 | 2,600 | 3,045 | |||||||||
Add back (subtract): | ||||||||||||
Net gain on sale of investment securities | (192 | ) | (184 | ) | (305 | ) | ||||||
Net (gain) loss on sale of other real estate owned | 542 | (10 | ) | (86 | ) | |||||||
Merger-related expenses | 971 | — | — | |||||||||
Other real estate owned related expense, net | 114 | 250 | 316 | |||||||||
Loan collection expense | 248 | 133 | 119 | |||||||||
Severance and retirement compensation expense | — | — | — | |||||||||
Pre-tax, pre-provision earnings, as adjusted | $ | 2,258 | $ | 2,789 | $ | 3,089 | ||||||
Pre-tax, pre-provision earnings, as adjusted, to average assets (annualized) | .80 | % | .99 | % | 1.07 | % | ||||||
Six Months Ended | ||||||||||||
June 30, 2013 | June 30, 2012 | |||||||||||
Income (loss) before income taxes | $ | 1,589 | $ | 2,385 | ||||||||
Provision for loan losses | 1,586 | 2,200 | ||||||||||
Pre-tax, pre-provision earnings | 3,175 | 4,585 | ||||||||||
Add back (subtract): | ||||||||||||
Net gain on sale of investment securities | (376 | ) | (723 | ) | ||||||||
Net (gain) loss on sale of other real estate owned | 532 | (39 | ) | |||||||||
Merger-related expenses | 971 | — | ||||||||||
Other real estate owned related expense, net | 364 | 934 | ||||||||||
Loan collection expense | 381 | 237 | ||||||||||
Severance and retirement compensation expense | — | 876 | ||||||||||
Pre-tax, pre-provision earnings, as adjusted | $ | 5,047 | $ | 5,870 | ||||||||
Pre-tax, pre-provision earnings, as adjusted, to average assets | .89 | % | 1.02 | % | ||||||||
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