EX-99 2 exhibit99.htm exhibit99.htm


     
PEOPLES BANCORP INC. – P.O. BOX 738 - MARIETTA, OHIO – 45750
www.peoplesbancorp.com


 NEWS RELEASE

FOR IMMEDIATE RELEASE
Contact:
Carol A. Schneeberger
  
January 24, 2008
  
Chief Financial Officer and Treasurer
  
   
(740) 373-3155
  


PEOPLES BANCORP INC. REPORTS FOURTH QUARTER
AND 2007 RESULTS
_____________________________________________________________________

MARIETTA, Ohio - Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) announced fourth quarter 2007 net income of $2.2 million, or $0.21 per diluted share, compared to $4.8 million, or $0.44, for the fourth quarter of 2006.  For 2007, net income totaled $18.3 million or $1.74 per diluted share compared to $21.6 million or $2.01 per diluted share for 2006.
The lower earnings for both the fourth quarter and full year 2007 were impacted by a $5.5 million ($3.6 million after-tax or $0.34 per diluted share) other-than-temporary impairment charge related to investments in certain securities, including preferred stocks issued by the Federal National Mortgage Association (“Fannie Mae”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”) and collateralized debt obligation (“CDO”) investments.  This non-cash charge for other-than-temporary impairment is comprised of a $1.3 million charge related to Fannie Mae preferred stock previously carried at $6.8 million, a $1.9 million charge related to Freddie Mac preferred stock previously carried at $8.5 million, a $0.1 million charge related to a single bank holding company stock held by Peoples previously carried at $0.2 million and a $2.2 million charge related to three CDO investment securities previously carried at $7.9 million.  This charge was partially offset by a $782,000 ($508,000 after-tax) reduction in franchise tax expense resulting from the adjustment to Peoples’ tax reserves to reflect the settlement agreement with the Tax Commissioner of the State of Ohio resolving certain controversies concerning Peoples’ Ohio corporation franchise tax liabilities and associated calculations for the 2002 through 2008 tax years (Fiscal years 2001-2007).
“Market values of certain investments have decreased due to increased risks within the broader credit market and erratic market liquidity,” said Mark F. Bradley, President and Chief Executive Officer.  “Peoples Bancorp's capital levels mitigate the negative impact of the resulting other-than-temporary impairment charge.”
Bradley continued, “Without the impairment charges, our results in 2007 reflect success in diversifying revenues, improving operating efficiency and reducing our reliance on net interest income.  Revenue growth was strong and net loan charge-offs decreased.  Additionally, dividends increased 6% to $0.88 per share in 2007, marking our 42nd consecutive year of dividend growth.”
Net interest income for the fourth quarter of 2007 was $13.9 million, up 6% from $13.2 million for the third quarter.  During the same period, net interest margin improved 14 basis points to 3.40%.  Compared to the fourth quarter of 2006, net interest income increased 3% and net interest margin expanded 9 basis points in the fourth quarter of 2007.  These improvements were the result of management’s efforts to reduce Peoples’ funding costs by reducing certain deposit rates and taking advantage of lower cost funding available in the market place in response to the Federal Reserve’s actions to decrease short-term interest rates and improved yield in two separate pools of loans acquired in acquisitions during 2002 and 2003. For 2007, net interest income totaled $53.9 million compared to $53.2 million in 2006, while net interest margin expanded slightly to 3.32% from 3.29%.
“While the lower interest rate environment helped us reduce funding costs in the fourth quarter, asset yields have also declined from the repricing of prime-based loans and new loans being originated at lower rates,” said Carol A. Schneeberger, Chief Financial Officer and Treasurer.  “However, we successfully grew earning asset levels during the quarter, which offset much of the impact of the lower loan yields.”
In the fourth quarter of 2007, total non-interest income was $7.6 million compared to $7.4 million a year ago.  In 2007, non-interest income totaled $31.4 million, up from $30.4 million in 2006.  The majority of these increases resulted from higher trust and investment income, which increased 16% for the fourth quarter and 17% for the year.  Since year-end 2006, Peoples has experienced a 10% gain in the dollar value of assets under management, attributable to the addition of

 
PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
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seasoned sales personnel, coupled with an increase in cross sales from retail banking operations.  Another contributing factor to non-interest income growth was increased e-banking revenues, which were up 16% and 14% compared to the fourth quarter and year ended December 31, 2006, respectively, reflecting steady volume increases in customer debit card activity.
“Non-interest income growth occurred in 2007 as a result of our efforts in recent years to diversify revenues,” said Schneeberger.  “Among the successes was strong production from our insurance agency that allowed total insurance commission income to remain stable, despite lower pricing margins in the insurance industry and annual performance based commissions.  We expect our renewed commitment to customer-focused delivery of financial services will continue to increase cross-sale opportunities, which in turn enhances the customer experience and contributes to additional non-interest revenues.”
Total non-interest expense decreased 4% in the fourth quarter of 2007, totaling $12.4 million versus $12.9 million, largely attributable to the reduction in franchise tax expense, tempered by increases in sales-based compensation and bankcard costs, which correspond to the higher insurance and investment income and e-banking revenue, and higher software licensing and support costs.   In 2007, non-interest expense was essentially flat totaling $51.5 million, as higher salaries and benefit costs were offset by reductions in other operating expenses.  Consequently, Peoples’ efficiency ratio improved to 57.1% in 2007, versus 57.5% in 2006.
In 2007, Peoples’ effective tax rate was 23.3%, down from 25.8% for the first nine months of 2007 and 26.7% for 2006.  The reduction in the effective tax rate was attributable to utilization of additional tax credits in 2007, coupled with a reduction in pre-tax income without a corresponding decline in tax-exempt income.  In 2008, management expects a modest increase in Peoples’ effective tax rate from a lower utilization of tax credits.
Gross portfolio loan balances were $1.12 billion at December 31, 2007, up $14.3 million since the prior quarter-end from commercial mortgage loan growth.  However, significant commercial and commercial mortgage loan payoffs throughout most of the year resulted in portfolio loan balances falling $11.5 million since year-end 2006.  Peoples’ serviced loan portfolio totaled $176.7 million, up 9% since year-end 2006.
“We are pleased to report loan growth in the fourth quarter,” added Schneeberger.  “Our continued focus on loan quality, coupled with the possibility of additional payoffs, is expected to make loan growth in the near term difficult.”
In the fourth quarter of 2007, Peoples’ provision for loan losses was $1.5 million versus $1.0 million in the third quarter and $1.9 million in the fourth quarter of 2006.  For the year, the provision for loan losses totaled $4.0 million in 2007, up from $3.6 million in 2006.   The provision for loan losses is based on management’s quarterly evaluation of the loan portfolio and is directionally consistent with changes in Peoples’ overall loan quality.  At December 31, 2007, non-performing loans totaled $9.4 million, or 0.83% of total loans, compared to $6.2 million, or 0.56%, at September 30, 2007 and $10.0 million, or 0.88%, at year-end 2006.  The allowance for loan losses was $15.7 million, or 168.0% of nonperforming loans, at year-end 2007, versus $14.6 million, or 237.3%, at September 30, 2007, and $14.5 million, or 145.0%, at December 31, 2006.  Nonaccrual loans increased $3.0 million from September 30, 2007 but are relatively unchanged from December 31, 2006.
In the fourth quarter of 2007, net loan charge-offs were $446,000, down from $1.0 million last quarter, due mostly to a reduction in commercial loan charge-offs.  Compared to the prior year, fourth quarter net loan charge-offs decreased substantially from $3.5 million, which was attributable to Peoples charging-off $2.9 million of impaired loans related to a single commercial loan relationship a year ago.  For the year, net loan charge-offs totaled $2.8 million in 2007 versus $3.8 million in 2006.
“We believe Peoples sustained overall loan quality in 2007,” stated Schneeberger.  “Many of the losses incurred in recent periods were due to credit declines in a limited number of loan relationships..  Additionally, total loan delinquencies have been at reasonable levels although we have seen a recent rise in both the dollar amount and number of loans 30 days or greater past due.  We are confident that our loan review process will continue to identify problem loans in a timely manner.”
Retail deposit balances, which exclude brokered deposits, grew $22.4 million since December 31, 2006 with interest-bearing retail balances rising $18.3 million in 2007, due to money market and interest-bearing demand balances increasing 14% and 13%, respectively. Non-interest-bearing deposits also grew $4.1 million in 2007, due to higher commercial deposit balances.
In 2007, Peoples repurchased 463,600 common shares at an average price of $26.21, under previously announced stock repurchase plans.  This compares to 37,800 common shares repurchased in 2006, at an average price of $28.35.
 “In 2007, operating results improved due to core deposit growth, net interest margin improvement, revenue growth through customer service and controlled expense growth,” summarized Bradley. “Given the uncertainty that exists in the financial markets and the economy as a whole, which can impact loan quality in 2008, we will continue to focus on earnings quality and conservative growth.”

PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
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Peoples Bancorp Inc. is a diversified financial products and services company with $1.9 billion in assets, 50 locations and 37 ATMs in Ohio, West Virginia and Kentucky.  Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc.  Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies.  Learn more about Peoples at www.peoplesbancorp.com.

Conference Call to Discuss Earnings:
Peoples will conduct a facilitated conference call to discuss fourth quarter and 2007 results of operations today at 11:00 a.m. Eastern Time, with members of Peoples’ executive management participating.  Analysts, media and individual investors are invited to participate in the conference call by calling (800) 860-2442.  A simultaneous Webcast of the conference call audio will be available online via the “Investor Relations” section of Peoples’ website, www.peoplesbancorp.com.  Participants are encouraged to call or sign in at least 15 minutes prior to the scheduled conference call time to ensure participation and, if required, download and install the necessary software.  A replay of the call will be available on Peoples’ website in the “Investor Relations” section for one year.


Safe HarborStatement:
This news release may contain certain forward-looking statements with respect to Peoples’ financial condition, results of operations, plans, objectives, future performance and business.  Except for the historical and present factual information contained in this news release, the matters discussed in this news release, and other statements identified by words such as “feel,” “expect,” “believe,” “plan,” “will,” “would,” “should,” “could” and similar expressions are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder.  These forward-looking statements are subject to risks and uncertain­ties that may cause actual results to differ materially.  Factors that might cause such a difference include, but are not limited to: (1) deterioration in the loan portfolio could be worse than expected due to a number of factors, such as the underlying value of the collateral could prove less valuable than otherwise assumed and assumed cash flows may be worse than expected, which may adversely impact the provision for loan losses (2) competitive pressures among financial institutions or from non-financial institutions, which may increase significantly; (3) changes in the interest rate environment, which may adversely impact interest margins; (4) prepayment speeds, loan originations and sale volumes, charge-offs and loan loss provisions, which may be less favorable than expected; (5) general economic conditions, either national or in the states in which Peoples and its subsidiaries do business, which may be less favorable than expected; (6) political developments, wars or other hostilities, which may disrupt or increase volatility in securities markets or other economic conditions; (7) legislative or regulatory changes or actions, which may adversely affect the business of Peoples and its subsidiaries; (8) adverse changes in the conditions and trends in the financial markets, which may adversely affect the fair value of securities within Peoples’ investment portfolio; (9) a delayed or incomplete resolution of regulatory issues that could arise; (10) ability to receive dividends from subsidiaries; (11) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity; (12) the costs and effects of regulatory and legal developments, including the outcome of regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; and (13) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (“SEC”), including those risk factors included in the disclosures under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2006 and under the heading “ITEM 1A: RISK FACTORS” of Part II of Peoples’ Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007.  Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements.  Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.

PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
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              PEOPLES BANCORP INC.  (NASDAQ:  PEBO)
              PER SHARE DATA AND PERFORMANCE RATIOS
 
 
Three Months Ended
  
Year Ended
 
December 31,
September 30,
  
December 31,
  
December 31,
(in $000’s, except per share data)
2007
  
2007
  
2006
  
2007
  
2006
Net income per share:
                  
   Basic
 $          0.21
  
 $            0.49
  
 $           0.45
  
 $      1.75
  
 $      2.03
   Diluted
 $          0.21
  
 $            0.49
  
 $           0.44
  
 $      1.74
  
 $      2.01
Cash dividends declared per share
 $          0.22
  
 $            0.22
  
 $           0.21
  
 $      0.88
  
 $      0.83
Book value per share
 $        19.70
  
 $          19.25
  
 $         18.51
  
 $    19.70
  
 $    18.51
Tangible book value per share (a)
 $        13.09
  
 $          12.63
  
 $         12.05
  
 $    13.09
  
 $    12.05
Closing stock price at end of period
 $        24.89
  
 $          26.18
  
 $         29.70
  
 $    24.89
  
 $    29.70
Dividend payout as a percentage of net income
103.58%
  
44.83%
  
47.14%
  
50.38%
  
41.09%
Return on average equity (b)
4.34%
  
10.27%
  
9.54%
  
9.21%
  
11.33%
Return on average assets  (b)
0.46%
  
1.09%
  
1.01%
  
0.98%
  
1.15%
Efficiency ratio (c)
54.14%
  
57.03%
  
58.14%
  
57.07%
  
57.51%
Net interest margin (fully-tax equivalent) (b)
3.40%
  
3.26%
  
3.31%
  
3.32%
  
3.29%

(a)
Excludes the balance sheet impact of intangible assets acquired through acquisitions.
(b)
Ratios are presented on an annualized basis.
(c)
Non-interest expense (less intangible amortization) as a percentage of fully tax-equivalent net interest income plus non-interest income (less securities and asset disposal gains/losses)
 
PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
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PEOPLES BANCORP INC. CONSOLIDATED STATEMENTS OF INCOME

 
Three Months Ended
  
Year Ended
 
December 31,
  
December 31,
(in $000’s)
2007
  
2006
  
2007
  
2006
Interest income
 $    28,738
  
 $    28,391
  
 $  113,419
  
 $  108,794
Interest expense
       14,823
  
       14,925
  
       59,498
  
       55,577
     Net interest income
       13,915
  
       13,466
  
       53,921
  
       53,217
Provision for loan losses
         1,522
  
         1,852
  
         3,959
  
         3,622
Net interest income after provision for loan losses
       12,393
  
       11,614
  
       49,962
  
       49,595
               
Net (loss) gain on investment securities
        (5,487)
  
            259
  
        (6,062)
  
            265
Net (loss) gain on asset disposals
                 -
  
               (7)
  
              76
  
              27
Net gain on sale of banking office
                 -
  
            222
  
                 -
  
            454
               
Non-interest income:
              
   Service charges on deposits
         2,515
  
         2,468
  
         9,890
  
       10,215
   Insurance commissions
         2,009
  
         2,090
  
         9,568
  
         9,538
   Trust and investment income
         1,344
  
         1,154
  
         4,983
  
         4,258
   Electronic banking revenues
            917
  
            792
  
         3,524
  
         3,080
   Business owned life insurance
            424
  
            428
  
         1,661
  
         1,637
   Mortgage banking income
            163
  
            247
  
            885
  
            825
   Other
            250
  
            199
  
            839
  
            826
           Total non-interest income
         7,622
  
         7,378
  
       31,350
  
       30,379
Non-interest expense:
              
   Salaries and benefits
         6,782
  
         6,389
  
       27,552
  
       26,178
   Net occupancy and equipment
         1,381
  
         1,423
  
         5,298
  
         5,252
   Data processing and software
            616
  
            504
  
         2,210
  
         1,905
   Professional fees
            532
  
            643
  
         2,246
  
         2,465
   Bankcard costs
            474
  
            344
  
         1,617
  
         1,284
   Amortization of intangible assets
            467
  
            556
  
         1,934
  
         2,261
   Marketing
            437
  
            373
  
         1,515
  
         1,659
   Franchise taxes
           (363)
  
            424
  
            973
  
         1,760
   Other
         2,035
  
         2,252
  
         8,107
  
         8,533
           Total non-interest expense
       12,361
  
       12,908
  
       51,452
  
       51,297
Income before income taxes
         2,167
  
         6,558
  
       23,874
  
       29,423
Income tax (benefit) expense
             (37)
  
         1,789
  
         5,560
  
         7,865
           Net income
 $      2,204
  
 $      4,769
  
 $    18,314
  
 $    21,558
               
Net income per share:
              
   Basic
 $        0.21
  
 $        0.45
  
 $        1.75
  
 $        2.03
   Diluted
 $        0.21
  
 $        0.44
  
 $        1.74
  
 $        2.01
               
Cash dividends declared per share
 $        0.22
  
 $        0.21
  
 $        0.88
  
 $        0.83
               
Weighted average shares outstanding:
              
   Basic
10,344,437
  
10,663,272
  
10,462,933
  
10,606,570
   Diluted
10,398,806
  
10,768,851
  
10,529,634
  
10,723,933
               
Actual shares outstanding  (end of period)
10,296,748
  
10,651,985
  
10,296,748
  
10,651,985


PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
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PEOPLES BANCORP INC. CONSOLIDATED BALANCE SHEETS
 
 
December 31,
  
December 31,
(in $000’s)
2007
  
2006
       
ASSETS
      
Cash and cash equivalents:
      
   Cash and due from banks
 $       43,275
  
 $        35,405
   Interest-bearing deposits in other banks
            1,925
  
             1,101
   Federal funds sold
                   -
  
             3,300
           Total cash and cash equivalents
          45,200
  
           39,806
       
Available-for-sale investment securities, at estimated fair value (amortized cost
    
   of $559,211 at December 31, 2007 and $550,239 at December 31, 2006)
        565,463
  
         548,733
       
Loans, net of unearned interest
     1,120,941
  
       1,132,394
Allowance for loan losses
        (15,718)
  
          (14,509)
   Net loans
     1,105,223
  
       1,117,885
       
Loans held for sale
            1,994
  
             1,041
Bank premises and equipment, net of accumulated depreciation
          24,803
  
           23,455
Business owned life insurance
          50,291
  
           48,630
Goodwill
          62,520
  
           61,373
Other intangible assets
            5,509
  
             7,479
Other assets
          24,550
  
           26,853
          TOTAL ASSETS
 $  1,885,553
  
 $    1,875,255
       
LIABILITIES
      
Non-interest-bearing deposits
 $     175,057
  
 $       170,921
Interest-bearing deposits
     1,011,320
  
       1,062,608
     Total deposits
     1,186,377
  
       1,233,529
       
Federal funds purchased, securities sold under repurchase agreements,
      
   and other short-term borrowings
        222,541
  
         194,883
Long-term borrowings
        231,979
  
         200,793
Junior subordinated notes held by subsidiary trusts
          22,460
  
           29,412
Accrued expenses and other liabilities
          19,360
  
           19,469
          TOTAL LIABILITIES
     1,682,717
  
       1,678,086
       
STOCKHOLDERS’ EQUITY
      
Common stock, no par value (24,000,000 shares authorized, 10,925,954 shares
    
   issued at December 31, 2007, and 10,889,242 shares issued at December 31, 2006)
        163,399
  
         162,654
Retained earnings
          52,527
  
           43,439
Accumulated comprehensive income (loss), net of deferred income taxes
            3,014
  
           (2,997)
Treasury stock, at cost (629,206 shares at December 31, 2007, and
      
   237,257 shares at December 31, 2006)
        (16,104)
  
           (5,927)
          TOTAL STOCKHOLDERS’ EQUITY
        202,836
  
         197,169
                  TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
 $  1,885,553
  
 $    1,875,255

PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
- Page 7 of 10-

PEOPLES BANCORP INC. SELECTED FINANCIAL INFORMATION
 
 
December 31,
  
September 30,
  
June 30,
  
March 31,
  
December 31,
(in $000’s, end of period)
2007
  
2007
  
2007
  
2007
  
2006
                   
LOAN PORTFOLIO
                  
Commercial, mortgage
 $     513,847
  
 $     481,341
  
 $     468,241
  
 $     477,189
  
 $     469,934
Commercial, other
       171,937
  
       174,753
  
       177,651
  
       195,612
  
       191,847
Real estate, construction
         71,794
  
         83,714
  
         96,690
  
         97,116
  
         99,311
Real estate, mortgage
       280,347
  
       284,105
  
       286,198
  
       290,514
  
       297,663
Consumer
         83,016
  
         82,708
  
         79,629
  
         75,194
  
         73,639
     Total loans
     1,120,941
  
     1,106,621
  
     1,108,409
  
     1,135,625
  
     1,132,394
                   
DEPOSIT BALANCES
                  
Interest-bearing deposits:
                  
   Retail certificates of deposit
 $     499,684
  
 $     515,432
  
 $     517,910
  
 $     528,543
  
 $     514,885
   Interest-bearing transaction accounts
       191,359
  
       178,880
  
       179,430
  
       182,164
  
       170,022
   Money market deposit accounts
       153,299
  
       147,848
  
       149,791
  
       145,073
  
       134,387
   Savings accounts
       107,389
  
       112,507
  
       115,691
  
       119,153
  
       114,186
   Brokered certificates of deposits
         59,589
  
         57,507
  
         66,601
  
         70,535
  
       129,128
        Total interest-bearing deposits
     1,011,320
  
     1,012,174
  
     1,029,423
  
     1,045,468
  
     1,062,608
Non-interest-bearing deposits
       175,057
  
       171,319
  
       173,675
  
       172,122
  
       170,921
Total deposits
     1,186,377
  
     1,183,493
  
     1,203,098
  
     1,217,590
  
     1,233,529
                   
ASSET QUALITY
                  
Nonperforming assets:
                  
   Loans 90 days or more past due
 $           378
  
 $           190
  
 $           313
  
 $               -
  
 $              1
   Renegotiated loans
                 –
  
                 –
  
                 –
  
                 –
  
           1,218
   Nonaccrual loans
           8,980
  
           5,979
  
           7,096
  
           6,015
  
           8,785
           Total nonperforming loans
           9,358
  
           6,169
  
           7,409
  
           6,015
  
         10,004
   Other real estate owned
              343
  
              343
  
              213
  
               50
  
                  -
           Total nonperforming assets
 $        9,701
  
 $        6,512
  
 $        7,622
  
 $        6,065
  
 $      10,004
                   
Allowance for loan losses as a percent of
                  
   nonperforming loans
168.0%
  
237.3%
  
198.3%
  
241.3%
  
145.0%
Nonperforming loans as a percent of total loans
0.83%
  
0.56%
  
0.67%
  
0.53%
  
0.88%
Nonperforming assets as a percent of total assets
0.51%
  
0.34%
  
0.41%
  
0.32%
  
0.53%
Nonperforming assets as a percent of total loans and
                
   other real estate owned
0.87%
  
0.59%
  
0.69%
  
0.53%
  
0.88%
Allowance for loan losses as a percent of total loans
1.40%
  
1.32%
  
1.33%
  
1.28%
  
1.28%
                   
REGULATORY CAPITAL (a)
                  
Tier 1 risk-based capital
11.91%
  
11.82%
  
11.74%
  
11.93%
  
11.98%
Total risk-based capital ratio (Tier 1 and Tier 2)
13.23%
  
13.04%
  
12.97%
  
13.11%
  
13.17%
Leverage ratio
8.48%
  
8.67%
  
8.67%
  
8.91%
  
8.90%
Tier 1 capital
 $     154,933
  
 $     156,209
  
 $     155,361
  
 $     161,170
  
 $     161,439
Total capital (Tier 1 and Tier 2)
 $     172,117
  
 $     172,263
  
 $     171,592
  
 $     177,207
  
 $     177,524
Total risk-weighted assets
 $  1,300,541
  
 $  1,321,367
  
 $  1,323,359
  
 $  1,351,409
  
 $  1,347,819
 
      (a) December 31, 2007 data based on preliminary analysis and subject to revision.
 
PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
- Page 8 of 10-
 
PEOPLES BANCORP INC. PROVISION FOR LOAN LOSSES INFORMATION
 
 
Three Months Ended
  
Year Ended
 
December 31,
September 30,
December 31,
December 31,
(in $000’s)
2007
2007
2006
2007
  
2006
PROVISION FOR LOAN LOSSES
                  
Provision for Overdraft Privilege losses
 $          172
  
 $             227
  
 $             152
  
 $          558
  
 $            712
Provision for other loan losses
          1,350
  
                740
  
             1,700
  
          3,401
  
            2,910
     Total provision for loan losses
 $       1,522
  
 $             967
  
 $          1,852
  
 $       3,959
  
 $         3,622
                   
NET CHARGE-OFFS
                  
Gross charge-offs
 $          840
  
 $          1,251
  
 $          3,682
  
 $       4,701
  
 $         5,484
Recoveries
              395
  
                233
  
                205
  
          1,951
  
            1,651
     Net charge-offs
 $          445
  
 $          1,018
  
 $          3,477
  
 $       2,750
  
 $         3,833
                   
NET CHARGE-OFFS (RECOVERIES) BY TYPE
                  
Overdrafts
 $          177
  
 $             207
  
 $             193
  
 $          569
  
 $            704
Real estate
              172
  
                232
  
                124
  
              403
  
               (17)
Consumer
                66
  
                107
  
                138
  
              469
  
               242
Commercial
                32
  
                472
  
             3,023
  
          1,315
  
            2,908
Credit card
                 (2)
  
                     -
  
                  (1)
  
                 (6)
  
                 (4)
     Total net charge-offs
 $          445
  
 $          1,018
  
 $          3,477
  
 $       2,750
  
 $         3,833
                   
Net charge-offs as a percent of loans (annualized)
0.16%
  
0.36%
  
1.22%
  
0.24%
  
0.35%
 

PEOPLES BANCORP INC. SUPPLEMENTAL INFORMATION
 
 
December 31,
  
September 30,
  
June 30,
  
March 31,
  
December 31,
(in $000’s, end of period)
2007
  
2007
  
2007
  
2007
  
2006
                   
Trust assets under management
 $     797,443
  
 $     805,931
  
 $     766,417
  
 $     744,939
  
 $     736,745
Brokerage assets under management
 $     129,650
  
 $     126,773
  
 $     118,058
  
 $     109,343
  
 $     103,814
Mortgage loans serviced for others
 $     176,742
  
 $     176,380
  
 $     172,314
  
 $     165,728
  
 $     162,511
Employees (full-time equivalent)
              559
  
              553
  
              556
  
              560
  
              547
Announced treasury share plans: (a)
                  
   Total shares authorized for plan
        925,000
  
        425,000
  
        425,000
  
        425,000
  
        425,000
   Shares purchased
         84,600
  
        139,000
  
         70,000
  
        170,000
  
         23,800
   Average price
 $        24.25
  
 $        24.05
  
 $        26.79
  
 $        28.70
  
 $        28.55

    (a) 2007 data reflects shares purchased under the 2007 Stock Repurchase Program announced on January 12, 2007, authorizing the repurchase of up to 425,000
     common shares, and the repurchase plan announced on November 9, 2007, authorizing the repurchase of up to 500,000 common shares, upon the completion
         of the 2007 Stock Repurchase Program.  2006 data reflects the 2006 Stock Repurchase Program authorizing the repurchase of up to 425,000 common shares.
         The number of common shares purchased for treasury and average price paid are presented for the three-month period ended on the date indicated.
 
PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release
- Page 9 of 10-

PEOPLES BANCORP INC. CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST INCOME
 
 
Three Months Ended
 
December 31, 2007
  
September 30, 2007
  
December 31, 2006
 
(in $000’s)
 
Balance
Income/
Expense
 Yield/ Cost
 
 
Balance
Income/
Expense
 Yield/
Cost
 
 
Balance
Income/
Expense
Yield/ Cost
ASSETS
                      
Short-term investments
 $          2,632
 $        31
4.64%
  
 $        4,035
 $        50
4.91%
  
 $        3,880
 $        48
4.95%
Investment securities (a)
         581,971
      7,906
5.43%
  
       571,632
      7,590
5.31%
  
       560,703
      7,157
5.11%
Gross loans (a)
      1,125,794
    21,232
7.48%
  
    1,105,592
    21,008
7.55%
  
    1,132,784
    21,588
7.58%
Allowance for loan losses
         (15,048)
      
        (14,662)
      
        (15,504)
    
Total earning assets
      1,695,349
    29,169
6.85%
  
    1,666,597
    28,648
6.84%
  
    1,681,863
    28,793
6.82%
     
6.86%
                
Intangible assets
           68,275
      
         68,754
      
         68,888
    
Other assets
         128,747
      
       129,015
      
       128,626
    
Total assets
      1,892,371
      
    1,864,366
      
    1,879,377
    
                       
LIABILITIES AND EQUITY
                      
Interest-bearing deposits:
                      
Savings
         109,543
         181
0.66%
  
       113,740
         190
0.66%
  
       117,079
         204
0.69%
Interest-bearing demand deposits
         336,828
      2,401
2.83%
  
       331,105
      2,511
3.01%
  
       318,534
      2,215
2.76%
Time deposits
         565,320
      6,472
4.54%
  
       583,581
      6,746
4.59%
  
       615,044
      6,970
4.50%
    Total interest-bearing deposits
      1,011,691
      9,054
3.55%
  
    1,028,426
      9,447
3.64%
  
    1,050,657
      9,389
3.55%
                       
Short-term borrowings
         245,977
      2,804
4.48%
  
       232,586
      2,975
5.03%
  
       212,758
      2,800
5.15%
Long-term borrowings
         244,822
      2,965
4.83%
  
       217,440
      2,667
4.89%
  
       231,734
      2,736
4.64%
Total borrowed funds
         490,799
      5,769
4.61%
  
       450,026
      5,642
4.92%
  
       444,492
      5,536
4.89%
    Total interest-bearing liabilities
      1,502,490
    14,823
3.91%
  
    1,478,452
    15,089
4.03%
  
    1,495,149
    14,925
3.95%
                       
Non-interest-bearing deposits
         173,411
      
       172,164
      
       169,962
    
Other liabilities
           15,071
      
         16,125
      
         15,839
    
Total liabilities
      1,690,972
      
    1,666,741
      
    1,680,950
    
                       
Stockholders’ equity
         201,399
      
       197,625
      
       198,427
    
Total liabilities and equity
 $   1,892,371
      
 $ 1,864,366
      
 $ 1,879,377
    
                       
Net interest income/spread (a)
  
 $ 14,346
2.94%
    
 $ 13,559
2.81%
    
 $ 13,868
2.87%
Net interest margin (a)
    
3.40%
      
3.26%
      
3.31%

              (a) Information presented on a fully tax-equivalent basis.


PEOPLES BANCORP INC.
Fourth Quarter 2007 Earnings Release                                                     
- Page 10 of 10-
 

 
Year Ended
 
December 31, 2007
  
December 31, 2006
(in $000’s)
 
Balance
Income/
Expense
Yield/
Cost
 
 
Balance
Income/
Expense
Yield/ Cost
ASSETS
              
Short-term investments
 $            3,512
 $         170
4.85%
  
 $              3,973
 $          180
4.53%
Investment securities (a)
           563,462
       29,595
5.25%
  
             573,040
        28,828
5.03%
Gross loans (a)
        1,122,808
       85,150
7.58%
  
          1,108,575
        81,456
7.35%
Allowance for loan losses
            (14,775)
      
             (15,216)
    
Total earning assets
        1,675,007
    114,915
6.86%
  
          1,670,372
      110,464
6.61%
               
Intangible assets
             68,440
      
               68,940
    
Other assets
           128,670
      
             129,718
    
Total assets
        1,872,117
      
          1,869,030
    
               
LIABILITIES AND EQUITY
              
Interest-bearing deposits:
              
Savings
           113,629
            725
0.64%
  
             122,682
             806
0.66%
Interest-bearing demand deposits
           327,392
         9,488
2.90%
  
             302,472
          7,716
2.55%
Time deposits
           586,967
       26,762
4.56%
  
             576,838
        23,739
4.12%
    Total interest-bearing deposits
        1,027,988
       36,975
3.60%
  
          1,001,992
        32,261
3.22%
   
         9,031
          
Short-term borrowings
           237,142
       11,835
4.93%
  
             210,962
        10,443
4.95%
Long-term borrowings
           219,915
       10,688
4.81%
  
             282,739
        12,873
4.55%
Total borrowed funds
           457,057
       22,523
4.87%
  
             493,701
        23,316
4.72%
    Total interest-bearing liabilities
        1,485,045
       59,498
3.99%
  
          1,495,693
        55,577
3.72%
               
Non-interest-bearing deposits
           172,571
      
             167,440
    
Other liabilities
             15,707
      
               15,604
    
Total liabilities
        1,673,323
      
          1,678,737
    
               
Stockholders’ equity
           198,794
      
             190,293
    
Total liabilities and equity
 $    1,872,117
      
 $       1,869,030
    
               
Net interest income/spread (a)
  
 $   55,417
2.87%
    
 $     54,887
2.89%
Net interest margin (a)
    
3.32%
      
3.29%
 
              (a) Information presented on a fully tax-equivalent basis.



END OF RELEASE