-----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, Qpw1lA+51BA81jyNEKDyf6hMUPGuCYIhu99yGhabAdIfK+VNjtwxliIbiuIihATY KN4JuZRgVdGNHbATIX8Cvw== 0000034782-06-000002.txt : 20060126 0000034782-06-000002.hdr.sgml : 20060126 20060126170521 ACCESSION NUMBER: 0000034782-06-000002 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20051231 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060126 DATE AS OF CHANGE: 20060126 FILER: COMPANY DATA: COMPANY CONFORMED NAME: 1ST SOURCE CORP CENTRAL INDEX KEY: 0000034782 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 351068133 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-06233 FILM NUMBER: 06554272 BUSINESS ADDRESS: STREET 1: 100 NORTH MICHIGAN STREET CITY: SOUTH BEND STATE: IN ZIP: 46601 BUSINESS PHONE: 5742352702 MAIL ADDRESS: STREET 1: P O BOX 1602 STREET 2: P O BOX 1602 CITY: SOUTH BEND STATE: IN ZIP: 46634 FORMER COMPANY: FORMER CONFORMED NAME: FBT BANCORP INC DATE OF NAME CHANGE: 19820818 8-K 1 pr8_k.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): January 26, 2006 1st Source Corporation (Exact name of registrant as specified in its charter) Indiana 0-6233 35-1068133 (State or other jurisdiction of (Commission File No.) (I.R.S. Employer incorporation) Identification No.) 100 North Michigan Street, South Bend, Indiana 46601 (Address of principal executive offices) (Zip Code) 574-235-2000 (Registrant's telephone number, including area code) Not Applicable (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 2.02 Results of Operations and Financial Condition On January 26, 2006, 1st Source Corporation issued a press release that announced its fourth quarter earnings for 2005. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein. ITEM 9.01 Financial Statements and Exhibits Exhibit 99.1: Press release dated January 26, 2006, with respect to 1st Source Corporation's financial results for the fourth quarter ended December 31, 2005. 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 hereunto duly authorized. 1st SOURCE CORPORATION (Registrant) Date: January 26, 2006 /s/CHRISTOPHER J. MURPHY III ---------------------------- Christopher J. Murphy III Chairman of the Board, President and CEO Date: January 26, 2006 LARRY E. LENTYCH ---------------- Larry E. Lentych Treasurer and Chief Financial Officer Principal Accounting Officer EX-99.1 2 pr.txt PRESS RELEASE Exhibit 99.1 FOR: Immediate Release CONTACT: Larry Lentych January 26, 2006 574 235 2000 Andrea Short 574 235 2000 1st Source Corporation Announces Year End Results, Dividend Increase South Bend, IN--1st Source Corporation (Nasdaq:SRCE), parent company of 1st Source Bank, today reported net income of $33.75 million for the year 2005, an increase of 35.19 percent over the $24.97 million reported for the year 2004. Diluted net income per common share for 2005 amounted to $1.61, up 35.29 percent compared to $1.19 diluted net income per common share for 2004. Net income was $9.10 million for the fourth quarter of 2005, up 15.76 percent compared to the $7.86 million of net income reported for the fourth quarter of 2004. Diluted net income per common share for the fourth quarter of 2005 amounted to $0.43, compared to $0.37 per common share reported in the fourth quarter of 2004. The Board of Directors approved an increase in the fourth quarter cash dividend to $0.14 per share. The cash dividend is payable on February 15, 2006 to shareholders of record on February 6, 2006, and is an increase of 16.67 percent over the $0.12 cash dividend announced one year ago. Christopher J. Murphy III, Chairman of 1st Source Corporation, commented, "We ended 2005 on a good note. We're up over 35.0 percent in net income for the year with a substantial portion coming from net recoveries in our loan and lease reserves. Total loan growth was up over 8.0 percent for the year. Additionally, we opened four banking centers in new locations throughout 2005, with two more scheduled to open early in 2006. Our investment managers continue to perform well, our specialty asset financing businesses have improved and are carefully growing their portfolios, our insurance agency had a banner year, and we are investing in a project to upgrade our core computer systems for improved client service, increased competitiveness, and improved effectiveness and efficiency in the long term." Page 2 - 1st Source Corporation January 26, 2006 Mr. Murphy continued, "All of this was accomplished in spite of a very challenging margin as well as very competitive markets for all of our businesses. We will continue our focus in 2006 on excellent client service, maintaining a sharp eye on credit quality, and keeping costs under control." 1st Source's reserve for loan losses as of December 31, 2005, was 2.38 percent of total loans and leases, compared to 2.79 percent as of December 31, 2004. Net recoveries were $0.87 million for the fourth quarter 2005, compared to net charge-offs of $3.93 million a year ago. Net recoveries for the year were $0.88 million compared to net charge-offs of $6.60 million in 2004. The ratio of nonperforming assets to net loans and leases was 0.87 percent on December 31, 2005, compared to 1.42 percent on December 31, 2004. Noninterest income for the fourth quarter of 2005 was $17.57 million, down 2.84 percent from the fourth quarter of 2004. Lower recoveries of mortgage servicing rights impairment in the fourth quarter of 2005, as compared to the same quarter of 2004, was the predominate factor behind the decrease. Other income and deposit fee income increased marginally during the fourth quarter of 2005. For the year, noninterest income was $68.53 million, up 9.25 percent from 2004. This year-over-year increase was mainly attributable to recoveries of mortgage servicing rights impairment, lower charges for other-than-temporary impairment of securities, and gains on partnership investments. These increases were somewhat offset by decreases in equipment rental income. Noninterest expense for the fourth quarter of 2005 was relatively flat at $30.86 million as compared to the $30.43 million reported for fourth quarter of 2004. For the year, noninterest expense was $123.44 million, down 2.87 percent from one year ago. Reductions in collection and repossession expense, a decline in professional fees, and lower depreciation expense on leased equipment were the significant factors behind the decrease. These decreases were partially offset by increases in salaries and employee benefits. As of December 31, 2005, the 1st Source common equity-to-assets ratio was 9.84 percent, compared to 9.16 percent a year ago. Shareholders' equity was $345.58 million, up from $326.60 million a year ago. Total assets at the end of the fourth quarter of 2005 remained relatively stable compared to the same period last year at $3.51 billion. Total loans and leases were up 8.04 percent and total deposits were down 2.19 percent from the comparable figures at the end of the fourth quarter of 2004. Page 3 - 1st Source Corporation January 26, 2006 1st Source Corporation is the largest locally controlled financial institution headquartered in the Northern Indiana-Southwestern Michigan area. While delivering a comprehensive range of consumer and commercial banking services, 1st Source Bank has distinguished itself with highly personalized services. 1st Source Bank also competes for business nationally by offering specialized financing services for new and used private and cargo aircraft, automobiles for leasing and rental agencies, medium and heavy duty trucks, construction and environmental equipment. The Corporation includes 64 banking centers in 15 counties, 5 Trustcorp Mortgage offices in Indiana and Ohio, and 23 locations nationwide for the 1st Source Bank Specialty Finance Group. With a history dating back to 1863, 1st Source Bank has a tradition of providing superior service to customers while playing a leadership role in the continued development of the communities in which it serves. 1st Source may be accessed on its home page at "www.1stsource.com." Its common stock is traded on the Nasdaq Stock Market under "SRCE" and appears in the National Market System tables in many daily newspapers under the code name "1st Src." Marketmakers in 1st Source common shares are Crowell, Weedon & Co.; FTN Midwest Research Securities; Goldman, Sachs & Company; Keefe, Bruyette & Woods, Inc.; Lehman Brothers, Inc.; Morgan Stanley & Company, Inc.; Prudential Equity Group, Inc.; Sandler O'Neill & Partners; Stifel, Nicolaus & Company; Susquehana Capital Group; UBS Securities, LLC; and William Blair & Company. 1st Source's floating rate cumulative trust preferred security is traded on the Nasdaq Stock Market under the symbol "SRCEO". The rate for the first quarter, 2006 is 6.26 percent. Marketmakers in those securities are Howe, Barnes Investments, Inc. and Stifel, Nicolaus & Company. Except for historical information contained herein, the matters discussed in this document express "forward-looking statements." Generally, the words "believe," "expect," "intend," "estimate," "anticipate," "project," "will" and similar expressions indicate forward-looking statements. Those statements, including statements, projections, estimates or assumptions concerning future events or performance, and other statements that are other than statements of historical fact, are subject to material risks and uncertainties. 1st Source cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date made. 1st Source may make other written or oral forward-looking statements from time to time. Readers are advised that various important factors could cause 1st Source's actual results or circumstances for future periods to differ materially Page 4 - 1st Source Corporation January 26, 2006 from those anticipated or projected in such forward-looking statements. Such factors, among others, include changes in laws, regulations or accounting principles generally accepted in the United States; 1st Source's competitive position within its markets served; increasing consolidation within the banking industry; unforeseen changes in interest rates; unforeseen downturns in the local, regional or national economies or in the industries in which 1st Source has credit concentrations; and other risks discussed in 1st Source's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, which filings are available from the SEC. 1st Source undertakes no obligation to publicly update or revise any forward-looking statements. # # # (Charts attached)
1st SOURCE CORPORATION Page 5 4th QUARTER 2005 FINANCIAL HIGHLIGHTS (Unaudited - Dollars in thousands, except for per share data) Three Months Ended Twelve Months Ended December 31 December 31 2005 2004 2005 2004 -------------------------- --------------------------- END OF PERIOD BALANCES Assets $ 3,511,277 $ 3,563,715 Loans and leases 2,463,431 2,280,168 Deposits 2,745,587 2,807,003 Reserve for loan and lease losses 58,697 63,672 Intangible assets 21,381 23,588 Common shareholders' equity 345,576 326,600 AVERAGE BALANCES Assets $ 3,389,502 $ 3,507,471 $ 3,373,137 $ 3,349,364 Earning assets 3,161,149 3,283,278 3,152,235 3,121,990 Investments 637,582 784,417 702,606 762,386 Loans and leases 2,407,290 2,277,611 2,348,690 2,240,055 Deposits 2,639,051 2,691,849 2,610,398 2,489,170 Interest bearing liabilities 2,596,432 2,735,176 2,590,486 2,590,324 Common shareholders' equity 342,186 325,288 333,623 319,737 INCOME STATEMENT DATA Net interest income $ 25,323 $ 23,369 $ 98,428 $ 98,688 Net interest income - FTE 25,985 24,014 101,095 101,403 (Recovery of)/provision for loan and lease losses (719) (591) (5,855) 229 Noninterest income 17,574 18,087 68,533 62,733 Noninterest expense 30,856 30,430 123,439 127,091 Net income 9,099 7,860 33,751 24,965 PER SHARE DATA Basic net income per common share $ 0.44 $ 0.38 $ 1.63 $ 1.21 Diluted net income per common share 0.43 0.37 1.61 1.19 Cash dividends paid per common share 0.130 0.110 0.490 0.420 Book value per common share 16.72 15.76 16.72 15.76 Market value - High 26.100 28.090 26.100 28.090 Market value - Low 20.920 25.150 19.410 20.350 Basic weighted average common shares outstanding 20,669,547 20,727,663 20,685,911 20,709,457 Diluted weighted average common shares outstanding 20,949,028 21,015,302 20,957,103 20,984,822 KEY RATIOS Return on average assets 1.07% 0.89% 1.00% 0.75% Return on average common shareholders' equity 10.55 9.61 10.12 7.81 Average common shareholders' equity to average assets 10.10 9.27 9.89 9.55 End of period tangible common equity to tangible assets 9.29 8.56 9.29 8.56 Net interest margin 3.26 2.91 3.21 3.25 Efficiency: expense to revenue 68.55 68.66 70.69 72.80 Net charge-offs to average loans and leases (0.14) 0.69 (0.04) 0.29 Loan and lease loss reserve to loans and leases 2.38 2.79 2.38 2.79 Nonperforming assets to loans and leases 0.87 1.42 0.87 1.42 ASSET QUALITY Loans and leases past due 90 days or more $ 245 $ 481 Nonaccrual and restructured loans and leases 16,552 25,253 Other real estate 960 1,307 Repossessions 4,284 4,382 Equipment owned under operating leases 0 1,785 Total nonperforming assets 22,041 33,208
1st SOURCE CORPORATION Page 6 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited - Dollars in thousands) December 31, 2005 December 31, 2004 -------------------------------------- ASSETS Cash and due from banks $ 124,817 $ 78,255 Federal funds sold and interest bearing deposits with other banks 68,578 220,131 Investment securities available-for-sale, at fair value 632,625 789,923 (amortized cost of $637,878 and $790,404 at December 31, 2005 and 2004, respectively) Mortgages held for sale 67,224 55,711 Loans and leases, net of unearned discount: Commercial and agricultural loans 453,197 425,018 Auto, light truck and environmental equipment 310,786 263,637 Medium and heavy duty truck 302,137 267,834 Aircraft financing 459,645 444,481 Construction equipment financing 224,230 196,516 Loans secured by real estate 601,077 583,437 Consumer loans 112,359 99,245 ------------ ------------ Total loans and leases 2,463,431 2,280,168 Reserve for loan and lease losses (58,697) (63,672) ------------ ------------ Net loans and leases 2,404,734 2,216,496 Equipment owned under operating leases 58,250 47,257 (net of accumulated depreciation) Premises and equipment 37,710 37,314 Accrued income and other assets 117,339 118,628 ------------ ------------ Total assets $ 3,511,277 $ 3,563,715 ================================ LIABILITIES Deposits: Noninterest bearing $ 393,494 $ 378,867 Interest bearing 2,352,093 2,428,136 ------------ ------------ Total deposits 2,745,587 2,807,003 Federal funds purchased and securities sold 230,756 216,751 under agreements to purchase Other short-term borrowings 46,713 82,911 Long-term debt and mandatorily redeemable securities 23,237 17,964 Subordinated notes 59,022 59,022 Accrued expenses and other liabilities 60,386 53,464 ------------ ------------ Total liabilities 3,165,701 3,237,115 SHAREHOLDERS' EQUITY Preferred stock; no par value - - Common stock; no par value 7,578 7,578 Authorized 40,000,000 shares; issued 21,617,073 at December 31, 2005 and 21,617,057 at December 31, 2004 Capital surplus 214,001 214,001 Retained earnings 139,601 115,830 Cost of common stock in treasury (12,364) (10,512) Accumulated other comprehensive loss (3,240) (297) ------------ ------------ Total shareholders' equity 345,576 326,600 ------------ ------------ Total liabilities and shareholders' equity $ 3,511,277 $ 3,563,715 ============ ============
1st SOURCE CORPORATION Page 7 CONSOLIDATED STATEMENTS OF INCOME (Unaudited - Dollars in thousands) Three Months Ended Twelve Months Ended December 31 December 31 2005 2004 2005 2004 ----------- ----------- ------------ ------------ Interest income: Loans and leases $ 39,931 $ 32,557 $ 147,814 $ 129,059 Investment securities, taxable 3,543 4,173 14,777 16,361 Investment securities, tax-exempt 1,333 1,230 5,275 5,065 Other 429 818 666 952 ----------- ----------- ------------ ------------ Total interest income 45,236 38,778 168,532 151,437 Interest expense: Deposits 16,243 12,445 56,341 41,698 Short-term borrowings 2,334 1,713 8,628 6,079 Subordinated notes 1,029 965 4,008 3,863 Long-term debt and mandatorily redeemable securities 307 286 1,127 1,109 ----------- ----------- ------------ ------------ Total interest expense 19,913 15,409 70,104 52,749 ----------- ----------- ------------ ------------ Net interest income 25,323 23,369 98,428 98,688 (Recovery of)/provision for loan and lease losses (719) (591) (5,855) 229 ----------- ----------- ------------ ------------ Net interest income after (recovery of) /provision for loan and lease losses 26,042 23,960 104,283 98,459 Noninterest income: Trust fees 3,207 3,059 12,877 12,361 Service charges on deposit accounts 4,905 4,135 17,775 16,228 Mortgage banking income 2,734 5,036 10,868 9,553 Equipment rental income 4,017 3,835 16,067 18,856 Other income 2,711 2,707 10,596 10,454 Investment securities and other investment (losses) gains - (685) 350 (4,719) ----------- ----------- ------------ ------------ Total noninterest income 17,574 18,087 68,533 62,733 ----------- ----------- ------------ ------------ Noninterest expense: Salaries and employee benefits 16,470 14,841 69,767 63,083 Net occupancy expense 2,067 1,874 7,749 7,196 Furniture and equipment expense 2,974 2,593 11,418 10,290 Depreciation - leased equipment 3,171 3,363 12,895 15,315 Supplies and communication 1,381 1,429 5,462 5,708 Loan and lease collection and repossession expense (146) 1,757 (1,094) 4,946 Other expense 4,939 4,573 17,242 20,553 ----------- ----------- ------------ ------------ Total noninterest expense 30,856 30,430 123,439 127,091 ----------- ----------- ------------ ------------ Income before income taxes 12,760 11,617 49,377 34,101 Income tax expense 3,661 3,757 15,626 9,136 ----------- ----------- ------------ ------------ Net income $ 9,099 $ 7,860 $ 33,751 $ 24,965 =========== =========== ============ ============
The NASDAQ Stock Market National Market Symbol: "SRCE" (CUSIP #336901 10 3) Please contact us at shareholder@1stsource.com -----END PRIVACY-ENHANCED MESSAGE-----