UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
FORM 10-Q
(Mark One)
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||
[X]
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 2011
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or
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||
[ ]
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Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from _________ to __________.
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Commission File Number 0-10967
_______________
FIRST MIDWEST BANCORP, INC.
(Exact name of Registrant as specified in its charter)
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||
Delaware
(State or other jurisdiction of
incorporation or organization)
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36-3161078
(IRS Employer Identification No.)
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One Pierce Place, Suite 1500
Itasca, Illinois 60143-9768
(Address of principal executive offices) (zip code)
______________
Registrant’s telephone number, including area code: (630) 875-7450
______________
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||
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. Yes [X] No [ ].
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||
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ].
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||
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Large accelerated filer [X] Accelerated filer [ ] Non-accelerated filer [ ].
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||
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X].
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As of August 9, 2011, there were 74,476,360 shares of $.01 par value common stock outstanding.
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Page
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Part I.
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FINANCIAL INFORMATION
|
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Item 1.
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Financial Statements (Unaudited)
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Item 2.
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||
Item 3.
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||
Item 4.
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||
Part II.
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OTHER INFORMATION
|
|
Item 1.
|
||
Item 1A.
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||
Item 2.
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||
Item 3.
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||
Item 4.
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||
Item 5.
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||
Item 6.
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GLOSSARY OF TERMS
|
|
First Midwest Bancorp, Inc. provides the following list of acronyms as a tool for the reader. The acronyms identified below are used in the Notes to Consolidated Financial Statements and in Management’s Discussion and Analysis of Financial Condition & Results of Operations.
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ALCO:
|
Asset Liability Committee
|
ATM:
|
automated teller machine
|
Bank:
|
First Midwest Bank (one of the Company’s two wholly owned subsidiaries)
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BOLI:
|
bank owned life insurance
|
CDOs:
|
collateralized debt obligations
|
CMOs:
|
collateralized mortgage obligations
|
Code:
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the Code of Ethics and Standards of Conduct of First Midwest Bancorp, Inc.
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Common Stock:
|
shares of common stock of First Midwest Bancorp, Inc. $0.01 par value per share, which are traded on the Nasdaq Stock Market under the symbol “FMBI”
|
Company:
|
First Midwest Bancorp, Inc.
|
CPP:
|
Capital Purchase Program enacted under TARP and the Emergency Economic Stabilization Act of 2008
|
CSV:
|
cash surrender value
|
Dodd-Frank Act:
|
the recently enacted Dodd-Frank Wall Street Reform and Consumer Protection Act
|
FASB:
|
Financial Accounting Standards Board
|
FDIC:
|
Federal Deposit Insurance Corporation
|
Federal Reserve:
|
Board of Governors of the Federal Reserve system
|
FHLB:
|
Federal Home Loan Bank
|
GAAP:
|
U.S. generally accepted accounting principles
|
HAMP:
|
U.S. Department of the Treasury Home Affordable Modification Program
|
LIBOR:
|
London Interbank Offered Rate
|
NSF:
|
non-sufficient-funds
|
OREO:
|
Other real estate owned, or properties acquired through foreclosure in partial or total satisfaction of certain loans as a result of borrower defaults
|
OTTI:
|
other-than-temporary impairment
|
PSLRA:
|
Private Securities Litigation Reform Act of 1995
|
SEC:
|
U.S. Securities and Exchange Commission
|
TARP:
|
Troubled Asset Relief Program
|
Treasury:
|
U.S. Department of the Treasury
|
VIE:
|
variable interest entity
|
·
|
Certificate of Incorporation,
|
·
|
Company By-laws,
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·
|
Charters for our Audit, Compensation, and Nominating and Corporate Governance Committees,
|
·
|
Related Person Transaction Policies and Procedures,
|
·
|
Corporate Governance Guidelines,
|
·
|
Code of Ethics and Standards of Conduct (the “Code”), which governs our directors, officers, and employees,
|
·
|
Code of Ethics for Senior Financial Officers, and
|
·
|
Luxury Policy.
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June 30,
2011
|
December 31,
2010
|
||||||||||||
Assets
|
(Unaudited)
|
||||||||||||
Cash and due from banks
|
$
|
110,159
|
$
|
102,495
|
|||||||||
Interest-bearing deposits in other banks
|
601,310
|
483,281
|
|||||||||||
Trading securities, at fair value
|
16,230
|
15,282
|
|||||||||||
Securities available-for-sale, at fair value
|
1,009,873
|
1,057,802
|
|||||||||||
Securities held-to-maturity, at amortized cost
|
76,142
|
81,320
|
|||||||||||
Federal Home Loan Bank and Federal Reserve Bank stock, at cost
|
58,187
|
61,338
|
|||||||||||
Loans, excluding covered loans
|
5,112,911
|
5,100,560
|
|||||||||||
Covered loans
|
314,942
|
371,729
|
|||||||||||
Allowance for loan losses
|
(137,331)
|
(142,572)
|
|||||||||||
Net loans
|
5,290,522
|
5,329,717
|
|||||||||||
Other real estate owned (“OREO”), excluding covered OREO
|
24,407
|
31,069
|
|||||||||||
Covered OREO
|
14,583
|
22,370
|
|||||||||||
Federal Deposit Insurance Corporation (“FDIC”) indemnification asset
|
95,752
|
95,899
|
|||||||||||
Premises, furniture, and equipment
|
131,952
|
140,907
|
|||||||||||
Accrued interest receivable
|
28,883
|
29,953
|
|||||||||||
Investment in bank-owned life insurance (“BOLI”)
|
198,149
|
197,644
|
|||||||||||
Goodwill and other intangible assets
|
284,120
|
286,033
|
|||||||||||
Other assets
|
189,122
|
203,192
|
|||||||||||
Total assets
|
$
|
8,129,391
|
$
|
8,138,302
|
|||||||||
Liabilities
|
|||||||||||||
Demand deposits
|
$
|
1,494,390
|
$
|
1,329,505
|
|||||||||
Savings deposits
|
937,839
|
871,166
|
|||||||||||
NOW accounts
|
1,087,945
|
1,073,211
|
|||||||||||
Money market deposits
|
1,211,155
|
1,245,610
|
|||||||||||
Time deposits
|
1,764,220
|
1,991,984
|
|||||||||||
Total deposits
|
6,495,549
|
6,511,476
|
|||||||||||
Borrowed funds
|
272,024
|
303,974
|
|||||||||||
Subordinated debt
|
137,748
|
137,744
|
|||||||||||
Accrued interest payable and other liabilities
|
82,479
|
73,063
|
|||||||||||
Total liabilities
|
6,987,800
|
7,026,257
|
|||||||||||
Stockholders’ Equity
|
|||||||||||||
Preferred stock
|
191,220
|
190,882
|
|||||||||||
Common stock
|
858
|
858
|
|||||||||||
Additional paid-in capital
|
424,877
|
437,550
|
|||||||||||
Retained earnings
|
802,072
|
787,678
|
|||||||||||
Accumulated other comprehensive loss, net of tax
|
(15,339)
|
(27,739)
|
|||||||||||
Treasury stock, at cost
|
(262,097)
|
(277,184)
|
|||||||||||
Total stockholders’ equity
|
1,141,591
|
1,112,045
|
|||||||||||
Total liabilities and stockholders’ equity
|
$
|
8,129,391
|
$
|
8,138,302
|
|||||||||
June 30, 2011
|
December 31, 2010
|
||||||||||||
Preferred
Shares
|
Common
Shares
|
Preferred
Shares
|
Common
Shares
|
||||||||||
Par Value
|
None
|
$
|
0.01
|
None
|
$
|
0.01
|
|||||||
Shares authorized
|
1,000
|
100,000
|
1,000
|
100,000
|
|||||||||
Shares issued
|
193
|
85,787
|
193
|
85,787
|
|||||||||
Shares outstanding
|
193
|
74,473
|
193
|
74,096
|
|||||||||
Treasury shares
|
-
|
11,314
|
-
|
11,691
|
|||||||||
See accompanying notes to unaudited consolidated financial statements.
|
Quarters Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Interest Income
|
||||||||||||
Loans
|
$
|
63,089
|
$
|
65,439
|
$
|
126,006
|
$
|
129,919
|
||||
Investment securities
|
9,848
|
13,699
|
19,713
|
27,651
|
||||||||
Covered loans
|
7,655
|
2,598
|
15,477
|
5,560
|
||||||||
Federal funds sold and other short-term investments
|
704
|
538
|
1,383
|
923
|
||||||||
Total interest income
|
81,296
|
82,274
|
162,579
|
164,053
|
||||||||
Interest Expense
|
||||||||||||
Deposits
|
6,969
|
9,626
|
14,640
|
20,171
|
||||||||
Borrowed funds
|
687
|
749
|
1,367
|
1,759
|
||||||||
Subordinated debt
|
2,279
|
2,280
|
4,565
|
4,566
|
||||||||
Total interest expense
|
9,935
|
12,655
|
20,572
|
26,496
|
||||||||
Net interest income
|
71,361
|
69,619
|
142,007
|
137,557
|
||||||||
Provision for loan losses
|
18,763
|
21,526
|
38,255
|
39,876
|
||||||||
Net interest income after provision for loan losses
|
52,598
|
48,093
|
103,752
|
97,681
|
||||||||
Noninterest Income
|
||||||||||||
Service charges on deposit accounts
|
9,563
|
9,052
|
17,707
|
17,433
|
||||||||
Trust and investment advisory fees
|
4,118
|
3,702
|
8,234
|
7,295
|
||||||||
Other service charges, commissions, and fees
|
5,362
|
4,628
|
10,276
|
8,800
|
||||||||
Card-based fees
|
5,162
|
4,497
|
9,691
|
8,390
|
||||||||
BOLI income
|
259
|
349
|
511
|
597
|
||||||||
Securities gains, net
|
1,531
|
1,121
|
2,071
|
4,178
|
||||||||
Gain on FDIC-assisted transaction
|
-
|
4,303
|
-
|
4,303
|
||||||||
Other
|
499
|
(342)
|
2,221
|
635
|
||||||||
Total noninterest income
|
26,494
|
27,310
|
50,711
|
51,631
|
||||||||
Noninterest Expense
|
||||||||||||
Salaries and wages
|
25,493
|
21,146
|
51,158
|
43,282
|
||||||||
Retirement and other employee benefits
|
5,765
|
5,394
|
12,623
|
10,142
|
||||||||
OREO expense, net
|
5,223
|
11,850
|
9,154
|
22,637
|
||||||||
FDIC premiums
|
1,708
|
2,546
|
4,433
|
5,078
|
||||||||
Net occupancy and equipment expense
|
8,012
|
7,808
|
17,115
|
15,976
|
||||||||
Technology and related costs
|
2,697
|
2,785
|
5,320
|
5,268
|
||||||||
Professional services
|
5,640
|
5,652
|
10,759
|
12,192
|
||||||||
Other expenses
|
10,885
|
10,274
|
19,984
|
18,353
|
||||||||
Total noninterest expense
|
65,423
|
67,455
|
130,546
|
132,928
|
||||||||
Income before income tax expense
|
13,669
|
7,948
|
23,917
|
16,384
|
||||||||
Income tax expense
|
2,841
|
139
|
2,871
|
494
|
||||||||
Net income
|
10,828
|
7,809
|
21,046
|
15,890
|
||||||||
Preferred dividends and accretion
|
(2,582)
|
(2,573)
|
(5,163)
|
(5,145)
|
||||||||
Net income applicable to non-vested restricted shares
|
(102)
|
(65)
|
(242)
|
(146)
|
||||||||
Net income applicable to common shares
|
$
|
8,144
|
$
|
5,171
|
$
|
15,641
|
$
|
10,599
|
||||
Per Common Share Data
|
||||||||||||
Basic earnings per common share
|
$
|
0.11
|
$
|
0.07
|
$
|
0.21
|
$
|
0.15
|
||||
Diluted earnings per common share
|
$
|
0.11
|
$
|
0.07
|
$
|
0.21
|
$
|
0.15
|
||||
Dividends declared per common share
|
$
|
0.01
|
$
|
0.01
|
$
|
0.02
|
$
|
0.02
|
||||
Weighted-average common shares outstanding
|
73,259
|
73,028
|
73,205
|
71,756
|
||||||||
Weighted-average diluted common shares outstanding
|
73,259
|
73,028
|
73,205
|
71,756
|
||||||||
See accompanying notes to unaudited consolidated financial statements.
|
Common
Shares
Outstanding
|
Preferred
Stock
|
Common
Stock
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Accumulated
Other
Comprehensive Loss
|
Treasury
Stock
|
Total
|
||||||||||||||||
Balance at January 1, 2010
|
54,793
|
$
|
190,233
|
$
|
670
|
$
|
252,322
|
$
|
810,626
|
$
|
(18,666)
|
$
|
(293,664)
|
$
|
941,521
|
||||||||
Comprehensive income:
|
|||||||||||||||||||||||
Net income
|
-
|
-
|
-
|
-
|
15,890
|
-
|
-
|
15,890
|
|||||||||||||||
Other comprehensive income (1):
|
|||||||||||||||||||||||
Unrealized gains on securities
|
-
|
-
|
-
|
-
|
-
|
5,863
|
-
|
5,863
|
|||||||||||||||
Total comprehensive income
|
21,753
|
||||||||||||||||||||||
Common dividends declared
($0.02 per common share)
|
-
|
-
|
-
|
-
|
(1,481)
|
-
|
-
|
(1,481)
|
|||||||||||||||
Preferred dividends declared
($25.00 per preferred share)
|
-
|
-
|
-
|
-
|
(4,825)
|
-
|
-
|
(4,825)
|
|||||||||||||||
Accretion on preferred stock
|
-
|
320
|
-
|
-
|
(320)
|
-
|
-
|
-
|
|||||||||||||||
Issuance of common stock
|
18,818
|
-
|
188
|
195,857
|
-
|
-
|
-
|
196,045
|
|||||||||||||||
Share-based compensation
expense
|
-
|
-
|
-
|
2,871
|
-
|
-
|
-
|
2,871
|
|||||||||||||||
Restricted stock activity
|
441
|
-
|
-
|
(15,386)
|
-
|
-
|
15,011
|
( 375)
|
|||||||||||||||
Treasury stock issued
to(purchased for)
benefit plans
|
(3)
|
-
|
-
|
(59)
|
-
|
-
|
62
|
3
|
|||||||||||||||
Balance at June 30, 2010
|
74,049
|
$
|
190,553
|
$
|
858
|
$
|
435,605
|
$
|
819,890
|
$
|
(12,803)
|
$
|
(278,591)
|
$
|
1,155,512
|
||||||||
Balance at January 1, 2011
|
74,096
|
$
|
190,882
|
$
|
858
|
$
|
437,550
|
$
|
787,678
|
$
|
(27,739)
|
$
|
(277,184)
|
$
|
1,112,045
|
||||||||
Comprehensive income:
|
|||||||||||||||||||||||
Net income
|
-
|
-
|
-
|
-
|
21,046
|
-
|
-
|
21,046
|
|||||||||||||||
Other comprehensive income (1):
|
|||||||||||||||||||||||
Unrealized gains on securities
|
-
|
-
|
-
|
-
|
-
|
12,400
|
-
|
12,400
|
|||||||||||||||
Total comprehensive income
|
33,446
|
||||||||||||||||||||||
Common dividends declared
($0.02 per common share)
|
-
|
-
|
-
|
-
|
(1,489)
|
-
|
-
|
(1,489)
|
|||||||||||||||
Preferred dividends declared
($25.00 per preferred share)
|
-
|
-
|
-
|
-
|
(4,825)
|
-
|
-
|
(4,825)
|
|||||||||||||||
Accretion on preferred stock
|
-
|
338
|
-
|
-
|
(338)
|
-
|
-
|
-
|
|||||||||||||||
Share-based compensation
expense
|
-
|
-
|
-
|
3,354
|
-
|
-
|
-
|
3,354
|
|||||||||||||||
Restricted stock activity
|
381
|
-
|
-
|
(15,977)
|
-
|
-
|
15,045
|
( 932)
|
|||||||||||||||
Treasury stock purchased for
benefit plans
|
(4)
|
-
|
-
|
(50)
|
-
|
-
|
42
|
( 8)
|
|||||||||||||||
Balance at June 30, 2011
|
74,473
|
$
|
191,220
|
$
|
858
|
$
|
424,877
|
$
|
802,072
|
$
|
(15,339)
|
$
|
(262,097)
|
$
|
1,141,591
|
(1)
|
Net of taxes and reclassification adjustments.
|
|
See accompanying notes to unaudited consolidated financial statements.
|
FIRST MIDWEST BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in thousands)
(Unaudited)
|
||||||||
Six Months Ended
June 30,
|
||||||||
2011
|
2010
|
|||||||
Net cash provided by operating activities
|
$
|
100,402
|
$
|
101,048
|
||||
Investing Activities
|
||||||||
Proceeds from maturities, repayments, and calls of securities available-for-sale
|
135,320
|
113,918
|
||||||
Proceeds from sales of securities available-for-sale
|
97,330
|
147,601
|
||||||
Purchases of securities available-for-sale
|
(167,174)
|
(64,352)
|
||||||
Proceeds from maturities, repayments, and calls of securities held-to-maturity
|
35,497
|
33,530
|
||||||
Purchases of securities held-to-maturity
|
(30,319)
|
(32,185)
|
||||||
Redemption (purchase) of Federal Reserve Bank stock
|
3,151
|
(3,000)
|
||||||
Net increase in loans
|
(17,785)
|
(76,222)
|
||||||
Proceeds from claims on BOLI
|
6
|
160
|
||||||
Proceeds from sales of OREO
|
21,435
|
30,800
|
||||||
Proceeds from sales of premises, furniture, and equipment
|
5,526
|
7
|
||||||
Purchases of premises, furniture, and equipment
|
(2,483)
|
(7,459)
|
||||||
Net cash proceeds received in an FDIC-assisted transaction
|
-
|
26,609
|
||||||
Net cash provided by investing activities
|
80,504
|
169,407
|
||||||
Financing Activities
|
||||||||
Net (decrease) increase in deposit accounts
|
(15,927)
|
153,987
|
||||||
Net decrease in borrowed funds
|
(31,950)
|
(367,474)
|
||||||
Proceeds from the issuance of common stock
|
-
|
196,045
|
||||||
Cash dividends paid
|
(6,310)
|
(6,114)
|
||||||
Restricted stock activity
|
(1,100)
|
(1,004)
|
||||||
Excess tax benefit (expense) related to share-based compensation
|
74
|
(194)
|
||||||
Net cash used in financing activities
|
(55,213)
|
(24,754)
|
||||||
Net increase in cash and cash equivalents
|
125,693
|
245,701
|
||||||
Cash and cash equivalents at beginning of period
|
585,776
|
127,379
|
||||||
Cash and cash equivalents at end of period
|
$
|
711,469
|
$
|
373,080
|
||||
Supplemental Disclosures:
|
||||||||
Non-cash transfers of loans to OREO
|
$
|
13,477
|
$
|
58,019
|
||||
Non-cash transfer of loans held-for-investment to loans held-for-sale
|
$
|
5,395
|
$
|
-
|
||||
Non-cash transfer of OREO to premises, furniture, and equipment
|
$
|
841
|
$
|
9,455
|
||||
Dividends declared but unpaid
|
$
|
746
|
$
|
741
|
||||
See accompanying notes to unaudited consolidated financial statements.
|
·
|
Changes in the composition of the loan portfolio and trends in volume and terms of loans, as well as trends in delinquent and non-accrual loans that could indicate historical averages do not reflect current conditions;
|
·
|
Changes in credit policies and procedures, including underwriting standards and collection, charge-off, and recovery practices not considered elsewhere in estimating credit losses;
|
·
|
Changes in the experience, ability, and depth of credit management and other relevant staff;
|
·
|
Changes in the quality of the Company’s loan review system and Board oversight;
|
·
|
The existence and effect of any concentration of credit, and changes in the level of concentrations, whether it is by market, loan type, or risk taking;
|
·
|
Changes in the value of underlying collateral for collateral-dependent loans;
|
·
|
Changes in the national and local economy that affect the collectability of the portfolio, including the condition of various market segments; and
|
·
|
The effect of other external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in the Company’s existing portfolio.
|
June 30, 2011
|
December 31, 2010
|
|||||||||||||||||||||||
Amortized
|
Gross Unrealized
|
Fair
|
Amortized
|
Gross Unrealized
|
Fair
|
|||||||||||||||||||
Cost
|
Gains
|
Losses
|
Value
|
Cost
|
Gains
|
Losses
|
Value
|
|||||||||||||||||
Securities Available-for-Sale
|
||||||||||||||||||||||||
U.S. agency securities
|
$
|
8,122
|
$
|
23
|
$
|
(32)
|
$
|
8,113
|
$
|
18,000
|
$
|
7
|
$
|
(121)
|
$
|
17,886
|
||||||||
Collateralized residential
mortgage obligations
(“CMOs”)
|
373,600
|
3,824
|
(722)
|
376,702
|
377,692
|
4,261
|
(2,364)
|
379,589
|
||||||||||||||||
Other residential
mortgage-backed
securities
|
91,539
|
6,290
|
(24)
|
97,805
|
100,780
|
5,732
|
(61)
|
106,451
|
||||||||||||||||
Municipal securities
|
471,617
|
10,487
|
(2,185)
|
479,919
|
512,063
|
4,728
|
(12,800)
|
503,991
|
||||||||||||||||
Collateralized debt
obligations (“CDOs”)
|
49,695
|
-
|
(33,208)
|
16,487
|
49,695
|
-
|
(34,837)
|
14,858
|
||||||||||||||||
Corporate debt securities
|
25,325
|
2,597
|
-
|
27,922
|
29,936
|
2,409
|
-
|
32,345
|
||||||||||||||||
Equity securities:
|
||||||||||||||||||||||||
Hedge fund investment
|
1,231
|
651
|
-
|
1,882
|
1,245
|
438
|
-
|
1,683
|
||||||||||||||||
Other equity securities
|
927
|
117
|
(1)
|
1,043
|
889
|
110
|
-
|
999
|
||||||||||||||||
Total equity securities
|
2,158
|
768
|
( 1)
|
2,925
|
2,134
|
548
|
-
|
2,682
|
||||||||||||||||
Total
|
$
|
1,022,056
|
$
|
23,989
|
$
|
(36,172)
|
$
|
1,009,873
|
$
|
1,090,300
|
$
|
17,685
|
$
|
(50,183)
|
$
|
1,057,802
|
||||||||
Securities Held-to-Maturity
|
||||||||||||||||||||||||
Municipal securities
|
$
|
76,142
|
$
|
2,343
|
$
|
-
|
$
|
78,485
|
$
|
81,320
|
$
|
1,205
|
$
|
-
|
$
|
82,525
|
||||||||
Trading Securities (1)
|
$
|
16,230
|
$
|
15,282
|
(1)
|
Trading securities held by the Company represent diversified investment securities held in a grantor trust under deferred compensation arrangements in which plan participants may direct amounts earned to be invested in securities other than Company stock.
|
June 30, 2011
|
||||||||||||
Available-for-Sale
|
Held-to-Maturity
|
|||||||||||
Amortized
Cost
|
Fair
Value
|
Amortized
Cost
|
Fair
Value
|
|||||||||
One year or less
|
$
|
8,301
|
$
|
7,967
|
$
|
7,010
|
$
|
7,226
|
||||
One year to five years
|
201,321
|
193,222
|
15,137
|
15,603
|
||||||||
Five years to ten years
|
115,597
|
110,947
|
21,468
|
22,129
|
||||||||
After ten years
|
229,540
|
220,305
|
32,527
|
33,527
|
||||||||
CMOs
|
373,600
|
376,702
|
-
|
-
|
||||||||
Other residential mortgage-backed securities
|
91,539
|
97,805
|
-
|
-
|
||||||||
Equity securities
|
2,158
|
2,925
|
-
|
-
|
||||||||
Total
|
$
|
1,022,056
|
$
|
1,009,873
|
$
|
76,142
|
$
|
78,485
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Proceeds from sales
|
$
|
53,118
|
$
|
66,618
|
$
|
97,330
|
$
|
147,601
|
||||
Gains (losses) on sales of securities:
|
||||||||||||
Gross realized gains
|
$
|
1,974
|
$
|
2,367
|
$
|
2,782
|
$
|
8,187
|
||||
Gross realized losses
|
(443)
|
(112)
|
(711)
|
(112)
|
||||||||
Net realized gains on securities sales
|
1,531
|
2,255
|
2,071
|
8,075
|
||||||||
Non-cash impairment charges
|
||||||||||||
Other-than-temporary securities impairment
|
-
|
(1,581)
|
-
|
(4,344)
|
||||||||
Portion of other-than-temporary impairment
recognized in other comprehensive income
|
-
|
447
|
-
|
447
|
||||||||
Net non-cash impairment charges
|
-
|
(1,134)
|
-
|
(3,897)
|
||||||||
Net realized gains
|
$
|
1,531
|
$
|
1,121
|
$
|
2,071
|
$
|
4,178
|
||||
Income tax expense on net realized gains
|
$
|
636
|
$
|
437
|
$
|
847
|
$
|
1,629
|
||||
Trading gains (losses), net (1)
|
$
|
(2)
|
$
|
(1,022)
|
$
|
742
|
$
|
(561)
|
(1)
|
All trading gains (losses) relate to trading securities still held as of June 30, 2011.
|
Quarter Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Cumulative amount recognized at beginning of period
|
$
|
35,589
|
$
|
33,709
|
$
|
35,589
|
$
|
30,946
|
||||
Credit losses included in earnings (1)
|
||||||||||||
Losses recognized on securities that previously had
credit losses
|
-
|
1,048
|
-
|
3,568
|
||||||||
Losses recognized on securities that did not
previously have credit losses
|
-
|
86
|
-
|
329
|
||||||||
Cumulative amount recognized at end of period
|
$
|
35,589
|
$
|
34,843
|
$
|
35,589
|
$
|
34,843
|
(1)
|
Included in securities gains, net in the Consolidated Statements of Income.
|
Less Than 12 Months
|
12 Months or Longer
|
Total
|
|||||||||||||||||||
Number of
Securities
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
|||||||||||||||
As of June 30, 2011
|
|||||||||||||||||||||
U.S. agency security
|
1
|
$
|
3,045
|
$
|
32
|
$
|
-
|
$
|
-
|
$
|
3,045
|
$
|
32
|
||||||||
CMOs
|
10
|
50,412
|
323
|
9,698
|
399
|
60,110
|
722
|
||||||||||||||
Other residential mortgage-
backed securities
|
2
|
317
|
18
|
159
|
6
|
476
|
24
|
||||||||||||||
Municipal securities
|
134
|
17,005
|
582
|
53,943
|
1,603
|
70,948
|
2,185
|
||||||||||||||
CDOs
|
6
|
-
|
-
|
16,487
|
33,208
|
16,487
|
33,208
|
||||||||||||||
Equity security
|
1
|
-
|
-
|
30
|
1
|
30
|
1
|
||||||||||||||
Total
|
154
|
$
|
70,779
|
$
|
955
|
$
|
80,317
|
$
|
35,217
|
$
|
151,096
|
$
|
36,172
|
||||||||
As of December 31, 2010
|
|||||||||||||||||||||
U.S. agency securities
|
4
|
$
|
9,096
|
$
|
120
|
$
|
-
|
$
|
1
|
$
|
9,096
|
$
|
121
|
||||||||
CMOs
|
19
|
131,056
|
1,727
|
7,843
|
637
|
138,899
|
2,364
|
||||||||||||||
Other residential mortgage-
backed securities
|
5
|
6,084
|
51
|
159
|
10
|
6,243
|
61
|
||||||||||||||
Municipal securities
|
479
|
99,537
|
3,142
|
166,403
|
9,658
|
265,940
|
12,800
|
||||||||||||||
CDOs
|
6
|
-
|
-
|
14,858
|
34,837
|
14,858
|
34,837
|
||||||||||||||
Total
|
513
|
$
|
245,773
|
$
|
5,040
|
$
|
189,263
|
$
|
45,143
|
$
|
435,036
|
$
|
50,183
|
Number
|
Class
|
Original Par
|
Amortized Cost
|
Fair Value
|
Number of Banks/
Insurers
|
% of Banks/ Insurers Currently Performing
|
Actual Deferrals and Defaults as a % of the Original Collateral (1)
|
Expected Deferrals and Defaults as a % of the Remaining Performing Collateral (1)
|
Excess Subordination as a % of the Remaining
Performing Collateral (2)
|
||||||||||||||||
Lowest Credit Rating
Assigned to the Security
|
|||||||||||||||||||||||||
Moody’s
|
Fitch
|
||||||||||||||||||||||||
1
|
C-1
|
$
|
17,500
|
$
|
7,140
|
$
|
3,353
|
Ca
|
C
|
46
|
73.9%
|
15.8%
|
20.7%
|
0.0%
|
|||||||||||
2
|
C-1
|
15,000
|
7,657
|
2,477
|
Ca
|
C
|
57
|
84.2%
|
12.1%
|
18.8%
|
0.0%
|
||||||||||||||
3
|
C-1
|
15,000
|
13,480
|
4,016
|
Ca
|
C
|
63
|
81.0%
|
7.8%
|
15.5%
|
6.0%
|
||||||||||||||
4
|
B1
|
15,000
|
13,922
|
4,344
|
Ca
|
C
|
64
|
59.4%
|
35.0%
|
23.5%
|
0.0%
|
||||||||||||||
5
|
C
|
10,000
|
1,317
|
212
|
C
|
C
|
56
|
60.7%
|
44.6%
|
28.1%
|
0.0%
|
||||||||||||||
6
|
C
|
6,500
|
6,179
|
2,085
|
Ca
|
C
|
77
|
68.8%
|
23.1%
|
12.8%
|
10.5%
|
||||||||||||||
7 (3)
|
A-3L
|
6,750
|
-
|
-
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
||||||||||||||
$
|
85,750
|
$
|
49,695
|
$
|
16,487
|
(1)
|
Deferrals and defaults are provided net of recoveries. No recovery is assumed for collateral that has already defaulted. For deferring collateral, the Company assumes a recovery rate of 10% of par for banks, thrifts, and other depository institutions and 15% of par for insurance companies.
|
(2)
|
Excess subordination represents additional defaults in excess of current defaults that the CDO can absorb before the security experiences any credit impairment. The excess subordination percentage is calculated by dividing the amount of potential additional loss that can be absorbed (before the receipt of all expected future principal and interest payments is affected) by the total balance of performing collateral. Even with excess subordination, the CDO could experience an OTTI charge if future deterioration of underlying collateral in excess of current excess subordination is anticipated.
|
(3)
|
Characteristics and metrics are not reported for this CDO since the security had an amortized cost and fair value of zero as of June 30, 2011.
|
Quarters Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
Number
|
2011
|
2010
|
2011
|
2010
|
Life-to-Date
|
||||||||||
1
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
10,360
|
|||||
2
|
-
|
794
|
-
|
794
|
7,343
|
||||||||||
3
|
-
|
-
|
-
|
-
|
1,159
|
||||||||||
4
|
-
|
-
|
-
|
684
|
1,078
|
||||||||||
5
|
-
|
254
|
-
|
2,091
|
8,570
|
||||||||||
6
|
-
|
-
|
-
|
242
|
243
|
||||||||||
7
|
-
|
-
|
-
|
-
|
6,750
|
||||||||||
$
|
-
|
$
|
1,048
|
$
|
-
|
$
|
3,811
|
$
|
35,503
|
June 30,
2011
|
December 31,
2010
|
|||||
Commercial and industrial
|
|
$
|
1,518,772
|
$
|
1,465,903
|
|
Agricultural
|
237,518
|
227,756
|
||||
Commercial real estate:
|
||||||
Office, retail, and industrial
|
1,229,100
|
1,203,613
|
||||
Multi-family
|
336,138
|
349,862
|
||||
Residential construction
|
|
129,327
|
174,690
|
|||
Commercial construction
|
146,679
|
164,472
|
||||
Other commercial real estate
|
852,966
|
856,357
|
||||
Total commercial real estate
|
2,694,210
|
2,748,994
|
||||
Total corporate loans
|
4,450,500
|
4,442,653
|
||||
Home equity
|
429,923
|
445,243
|
||||
1-4 family mortgages
|
185,002
|
160,890
|
||||
Installment loans
|
47,486
|
51,774
|
||||
Total consumer loans
|
662,411
|
657,907
|
||||
Total loans, excluding covered loans
|
5,112,911
|
5,100,560
|
||||
Covered loans (1)
|
314,942
|
371,729
|
||||
Total loans
|
$
|
5,427,853
|
$
|
5,472,289
|
||
Deferred loan fees included in total loans
|
$
|
7,965
|
$
|
8,042
|
||
Overdrawn demand deposits included in total loans
|
$
|
3,111
|
$
|
4,281
|
(1)
|
For information on covered loans, refer to Note 5, “Covered Assets.”
|
June 30,
2011
|
December 31,
2010
|
|||||
Home equity lines (1)
|
$
|
47,488
|
$
|
52,980
|
||
Covered impaired loans
|
226,286
|
281,893
|
||||
Other covered loans (2)
|
41,168
|
36,856
|
||||
Total covered loans
|
314,942
|
371,729
|
||||
FDIC indemnification asset
|
95,752
|
95,899
|
||||
Covered OREO
|
14,583
|
22,370
|
||||
Total covered assets
|
$
|
425,277
|
489,998
|
|||
Covered non-accrual loans
|
$
|
3,588
|
$
|
-
|
||
Covered loans past due 90 days or more and still accruing interest
|
$
|
68,324
|
$
|
84,350
|
(1)
|
These loans are open-end consumer loans that are not categorized as impaired loans.
|
(2)
|
These are loans that did not have evidence of impairment on the date of acquisition.
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Balance at beginning of period
|
$
|
85,386
|
$
|
54,591
|
$
|
95,899
|
$
|
67,945
|
||||
Additions
|
-
|
8,338
|
-
|
8,338
|
||||||||
(Amortization) accretion
|
(2,255)
|
812
|
(4,497)
|
2,249
|
||||||||
Expected reimbursements from the FDIC for changes in
expected credit losses (1)
|
19,321
|
12,958
|
21,834
|
12,718
|
||||||||
Payments received from the FDIC
|
(6,700)
|
(708)
|
(17,484)
|
(15,259)
|
||||||||
Balance at end of period
|
$
|
95,752
|
$
|
75,991
|
$
|
95,752
|
$
|
75,991
|
(1)
|
The increases in indemnification asset were a result of decreases in estimated cash flows on certain loans. The indemnification asset increased by the applicable loss share percentage for additional expected losses.
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Balance at beginning of period
|
$
|
51,010
|
$
|
7,795
|
$
|
63,616
|
$
|
9,298
|
||||
Additions
|
-
|
2,591
|
-
|
2,591
|
||||||||
Accretion
|
(12,104)
|
(4,142)
|
(20,528)
|
(5,645)
|
||||||||
Reclassifications from non-accretable difference, net (1)
|
16,700
|
18,230
|
12,518
|
18,230
|
||||||||
Balance at end of period
|
$
|
55,606
|
$
|
24,474
|
$
|
55,606
|
$
|
24,474
|
(1)
|
Amount represents an increase in the estimated cash flows to be collected on those loans showing improvement in the underlying portfolio.
|
Aging Analysis (Accruing and Non-accrual)
|
Non-performing Loans
|
|||||||||||||||||||||
Current
|
30-89 Days
Past Due
|
90 Days or
More Past
Due
|
Total
Past Due
|
Total
Loans
|
Non-accrual Loans
|
90 Days Past Due Loans, Still Accruing Interest
|
||||||||||||||||
June 30, 2011
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
1,478,587
|
$
|
11,349
|
$
|
28,836
|
$
|
40,185
|
$
|
1,518,772
|
$
|
44,393
|
$
|
2,095
|
||||||||
Agricultural
|
236,492
|
17
|
1,009
|
1,026
|
237,518
|
1,009
|
-
|
|||||||||||||||
Commercial real estate:
|
||||||||||||||||||||||
Office, retail, and industrial
|
1,207,733
|
5,135
|
16,232
|
21,367
|
1,229,100
|
16,567
|
303
|
|||||||||||||||
Multi-family
|
313,949
|
16,149
|
6,040
|
22,189
|
336,138
|
23,385
|
557
|
|||||||||||||||
Residential construction
|
104,237
|
5,297
|
19,793
|
25,090
|
129,327
|
23,576
|
-
|
|||||||||||||||
Commercial construction
|
125,230
|
-
|
21,449
|
21,449
|
146,679
|
21,449
|
-
|
|||||||||||||||
Other commercial real
estate
|
815,924
|
3,993
|
33,049
|
37,042
|
852,966
|
36,984
|
464
|
|||||||||||||||
Total commercial real
estate
|
2,567,073
|
30,574
|
96,563
|
127,137
|
2,694,210
|
121,961
|
1,324
|
|||||||||||||||
Total corporate loans
|
4,282,152
|
41,940
|
126,408
|
168,348
|
4,450,500
|
167,363
|
3,419
|
|||||||||||||||
Home equity
|
415,463
|
6,750
|
7,710
|
14,460
|
429,923
|
5,519
|
2,392
|
|||||||||||||||
1-4 family mortgages
|
177,785
|
2,278
|
4,939
|
7,217
|
185,002
|
4,577
|
656
|
|||||||||||||||
Installment loans
|
46,880
|
535
|
71
|
606
|
47,486
|
36
|
35
|
|||||||||||||||
Total consumer loans
|
640,128
|
9,563
|
12,720
|
22,283
|
662,411
|
10,132
|
3,083
|
|||||||||||||||
Total loans, excluding
covered loans
|
4,922,280
|
51,503
|
139,128
|
190,631
|
5,112,911
|
177,495
|
6,502
|
|||||||||||||||
Covered loans
|
217,069
|
26,180
|
71,693
|
97,873
|
314,942
|
3,588
|
68,324
|
|||||||||||||||
Total loans
|
$
|
5,139,349
|
$
|
77,683
|
$
|
210,821
|
$
|
288,504
|
$
|
5,427,853
|
$
|
181,083
|
$
|
74,826
|
||||||||
December 31, 2010
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
1,428,841
|
$
|
7,706
|
$
|
29,356
|
$
|
37,062
|
$
|
1,465,903
|
$
|
50,088
|
$
|
1,552
|
||||||||
Agricultural
|
225,007
|
65
|
2,684
|
2,749
|
227,756
|
2,497
|
187
|
|||||||||||||||
Commercial real estate:
|
||||||||||||||||||||||
Office, retail, and industrial
|
1,183,952
|
4,009
|
15,652
|
19,661
|
1,203,613
|
19,573
|
-
|
|||||||||||||||
Multi-family
|
345,018
|
2,811
|
2,033
|
4,844
|
349,862
|
6,203
|
-
|
|||||||||||||||
Residential construction
|
139,499
|
1,320
|
33,871
|
35,191
|
174,690
|
52,122
|
200
|
|||||||||||||||
Commercial construction
|
140,044
|
4,000
|
20,428
|
24,428
|
164,472
|
28,685
|
-
|
|||||||||||||||
Other commercial real
estate
|
813,333
|
9,091
|
33,933
|
43,024
|
856,357
|
40,605
|
345
|
|||||||||||||||
Total commercial
real estate
|
2,621,846
|
21,231
|
105,917
|
127,148
|
2,748,994
|
147,188
|
545
|
|||||||||||||||
Total corporate loans
|
4,275,694
|
29,002
|
137,957
|
166,959
|
4,442,653
|
199,773
|
2,284
|
|||||||||||||||
Home equity
|
431,446
|
4,715
|
9,082
|
13,797
|
445,243
|
7,948
|
1,870
|
|||||||||||||||
1-4 family mortgages
|
154,999
|
2,523
|
3,368
|
5,891
|
160,890
|
3,902
|
4
|
|||||||||||||||
Installment loans
|
50,899
|
742
|
133
|
875
|
51,774
|
159
|
86
|
|||||||||||||||
Total consumer loans
|
637,344
|
7,980
|
12,583
|
20,563
|
657,907
|
12,009
|
1,960
|
|||||||||||||||
Total loans, excluding
covered loans
|
4,913,038
|
36,982
|
150,540
|
187,522
|
5,100,560
|
211,782
|
4,244
|
|||||||||||||||
Covered loans
|
268,934
|
18,445
|
84,350
|
102,795
|
371,729
|
-
|
84,350
|
|||||||||||||||
Total loans
|
$
|
5,181,972
|
$
|
55,427
|
$
|
234,890
|
$
|
290,317
|
$
|
5,472,289
|
$
|
211,782
|
$
|
88,594
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Balance at beginning of period
|
$
|
145,003
|
$
|
144,824
|
$
|
145,072
|
$
|
144,808
|
||||
Loans charged-off
|
(27,748)
|
(24,732)
|
(49,317)
|
(44,729)
|
||||||||
Recoveries of loans previously charged-off
|
3,813
|
3,859
|
5,821
|
5,522
|
||||||||
Net loans charged-off
|
(23,935)
|
(20,873)
|
(43,496)
|
(39,207)
|
||||||||
Provision for loan losses
|
18,763
|
21,526
|
38,255
|
39,876
|
||||||||
Balance at end of period
|
$
|
139,831
|
$
|
145,477
|
$
|
139,831
|
$
|
145,477
|
||||
Allowance for loan losses
|
$
|
137,331
|
$
|
145,027
|
$
|
137,331
|
$
|
145,027
|
||||
Reserve for unfunded commitments
|
2,500
|
450
|
2,500
|
450
|
||||||||
Total allowance for credit losses
|
$
|
139,831
|
$
|
145,477
|
$
|
139,831
|
$
|
145,477
|
Commercial, Industrial,
and Agricultural
|
Office,
Retail, and Industrial
|
Multi-
Family
|
Residential Construction
|
Other Commercial
Real Estate
|
Consumer
|
Covered Loans
|
Total Allowance
|
|||||||||||||||||
Six Months ended June 30, 2011
|
||||||||||||||||||||||||
Balance at beginning of period
|
$
|
49,545
|
$
|
20,758
|
$
|
3,996
|
$
|
27,933
|
$
|
29,869
|
$
|
12,971
|
$
|
-
|
$
|
145,072
|
||||||||
Loans charged-off
|
(11,877)
|
(1,846)
|
(7,201)
|
(9,083)
|
(8,331)
|
(5,779)
|
(5,200)
|
(49,317)
|
||||||||||||||||
Recoveries of loans previously
charged-off
|
2,356
|
54
|
-
|
2,766
|
472
|
173
|
-
|
5,821
|
||||||||||||||||
Net loans charged-off
|
(9,521)
|
(1,792)
|
(7,201)
|
(6,317)
|
(7,859)
|
(5,606)
|
(5,200)
|
(43,496)
|
||||||||||||||||
Provision for loan losses
|
8,510
|
(2,104)
|
12,080
|
2,711
|
5,425
|
6,433
|
5,200
|
38,255
|
||||||||||||||||
Balance at end of period
|
$
|
48,534
|
$
|
16,862
|
$
|
8,875
|
$
|
24,327
|
$
|
27,435
|
$
|
13,798
|
$
|
-
|
$
|
139,831
|
||||||||
Six Months ended June 30, 2010
|
||||||||||||||||||||||||
Balance at beginning of period
|
$
|
54,452
|
$
|
20,164
|
$
|
4,555
|
$
|
33,078
|
$
|
21,084
|
$
|
11,475
|
$
|
-
|
$
|
144,808
|
||||||||
Loans charged-off
|
(11,919)
|
(4,229)
|
(1,359)
|
(14,605)
|
(6,483)
|
(5,483)
|
(651)
|
(44,729)
|
||||||||||||||||
Recoveries of loans previously
charged-off
|
4,090
|
232
|
362
|
159
|
142
|
537
|
-
|
5,522
|
||||||||||||||||
Net loans charged-off
|
(7,829)
|
(3,997)
|
( 997)
|
(14,446)
|
(6,341)
|
(4,946)
|
( 651)
|
(39,207)
|
||||||||||||||||
Provision for loan losses
|
11,526
|
7,838
|
2,106
|
3,883
|
7,634
|
6,238
|
651
|
39,876
|
||||||||||||||||
Balance at end of period
|
$
|
58,149
|
$
|
24,005
|
$
|
5,664
|
$
|
22,515
|
$
|
22,377
|
$
|
12,767
|
$
|
-
|
$
|
145,477
|
June 30,
2011
|
December 31,
2010
|
|||||
Impaired loans individually evaluated for impairment:
|
||||||
Impaired loans with a related allowance for credit losses (1)
|
$
|
23,362
|
$
|
13,790
|
||
Impaired loans with no specific related allowance (2)
|
129,225
|
173,534
|
||||
Total impaired loans individually evaluated for impairment
|
152,587
|
187,324
|
||||
Corporate non-accrual loans not individually evaluated for impairment (3)
|
14,776
|
12,449
|
||||
Total corporate non-accrual loans
|
167,363
|
199,773
|
||||
Restructured loans, still accruing interest
|
14,529
|
22,371
|
||||
Total impaired loans
|
$
|
181,892
|
$
|
222,144
|
||
Valuation allowance related to impaired loans
|
$
|
9,504
|
$
|
6,343
|
(1)
|
These impaired loans require a valuation allowance because the present value of expected future cash flows or the estimated value of the related collateral less estimated selling costs is less than the recorded investment in the loans.
|
(2)
|
No specific allowance for credit losses is allocated to these loans since they are deemed to be sufficiently collateralized or had charge-offs. However, while each component of the allowance for credit losses is determined separately, the entire balance is available for the entire loan portfolio.
|
(3)
|
These are loans with balances under a specified threshold.
|
Loans
|
Allowance For Credit Losses
|
|||||||||||||||||
Individually
Evaluated
For
Impairment
|
Collectively
Evaluated
For
Impairment
|
Total
|
Individually
Evaluated
For
Impairment
|
Collectively
Evaluated
For
Impairment
|
Total
|
|||||||||||||
June 30, 2011
|
||||||||||||||||||
Commercial, industrial, and
agricultural
|
$
|
36,529
|
$
|
1,719,761
|
$
|
1,756,290
|
$
|
4,265
|
$
|
44,269
|
$
|
48,534
|
||||||
Commercial real estate:
|
||||||||||||||||||
Office, retail, and industrial
|
15,316
|
1,213,784
|
1,229,100
|
-
|
16,862
|
16,862
|
||||||||||||
Multi-family
|
22,572
|
313,566
|
336,138
|
-
|
8,875
|
8,875
|
||||||||||||
Residential construction
|
22,510
|
106,817
|
129,327
|
251
|
24,076
|
24,327
|
||||||||||||
Other commercial real estate
|
55,660
|
943,985
|
999,645
|
4,988
|
22,447
|
27,435
|
||||||||||||
Total commercial real estate
|
116,058
|
2,578,152
|
2,694,210
|
5,239
|
72,260
|
77,499
|
||||||||||||
Total corporate loans
|
152,587
|
4,297,913
|
4,450,500
|
9,504
|
116,529
|
126,033
|
||||||||||||
Consumer
|
-
|
662,411
|
662,411
|
-
|
13,798
|
13,798
|
||||||||||||
Total
|
$
|
152,587
|
$
|
4,960,324
|
$
|
5,112,911
|
$
|
9,504
|
$
|
130,327
|
$
|
139,831
|
||||||
December 31, 2010
|
||||||||||||||||||
Commercial, industrial, and
agricultural
|
$
|
43,365
|
$
|
1,650,294
|
$
|
1,693,659
|
$
|
2,650
|
$
|
46,895
|
$
|
49,545
|
||||||
Commercial real estate:
|
||||||||||||||||||
Office, retail, and industrial
|
18,076
|
1,185,537
|
1,203,613
|
-
|
20,758
|
20,758
|
||||||||||||
Multi-family
|
5,696
|
344,166
|
349,862
|
497
|
3,499
|
3,996
|
||||||||||||
Residential construction
|
51,269
|
123,421
|
174,690
|
-
|
27,933
|
27,933
|
||||||||||||
Other commercial real estate
|
68,918
|
951,911
|
1,020,829
|
3,196
|
26,673
|
29,869
|
||||||||||||
Total commercial real estate
|
143,959
|
2,605,035
|
2,748,994
|
3,693
|
78,863
|
82,556
|
||||||||||||
Total corporate loans
|
187,324
|
4,255,329
|
4,442,653
|
6,343
|
125,758
|
132,101
|
||||||||||||
Consumer
|
-
|
657,907
|
657,907
|
-
|
12,971
|
12,971
|
||||||||||||
Total
|
$
|
187,324
|
$
|
4,913,236
|
$
|
5,100,560
|
$
|
6,343
|
$
|
138,729
|
$
|
145,072
|
June 30, 2011
|
December 31, 2010
|
||||||||||||||||||||||||
Recorded Investment In
|
Recorded Investment In
|
||||||||||||||||||||||||
Loans with No Specific Related Allowance
|
Loans with a Related Allowance for Credit Losses
|
Unpaid Principal Balance
|
Allowance for Credit Losses Allocated
|
Loans with No Specific Related Allowance
|
Loans with a Related Allowance for Credit Losses
|
Unpaid Principal Balance
|
Allowance for Credit Losses Allocated
|
||||||||||||||||||
Commercial and
industrial
|
$
|
25,326
|
$
|
10,807
|
$
|
44,016
|
$
|
4,265
|
$
|
40,715
|
$
|
2,650
|
$
|
53,353
|
$
|
2,650
|
|||||||||
Agricultural
|
396
|
-
|
469
|
-
|
2,447
|
-
|
2,982
|
-
|
|||||||||||||||||
Commercial real estate:
|
|||||||||||||||||||||||||
Office, retail, and
industrial
|
15,316
|
-
|
23,505
|
-
|
18,076
|
-
|
26,193
|
-
|
|||||||||||||||||
Multi-family
|
22,572
|
-
|
31,922
|
-
|
4,565
|
1,131
|
7,322
|
497
|
|||||||||||||||||
Residential
construction
|
19,358
|
3,152
|
63,081
|
251
|
51,269
|
-
|
129,698
|
-
|
|||||||||||||||||
Commercial
construction
|
20,889
|
399
|
28,818
|
178
|
28,685
|
-
|
38,404
|
-
|
|||||||||||||||||
Other commercial real
estate
|
25,368
|
9,004
|
55,627
|
4,810
|
27,777
|
10,009
|
60,465
|
3,196
|
|||||||||||||||||
Total commercial real
estate
|
103,503
|
12,555
|
202,953
|
5,239
|
130,372
|
11,140
|
262,082
|
3,693
|
|||||||||||||||||
Total impaired loans
individually evaluated
for impairment
|
$
|
129,225
|
$
|
23,362
|
$
|
247,438
|
$
|
9,504
|
$
|
173,534
|
$
|
13,790
|
$
|
318,417
|
$
|
6,343
|
Six Months Ended
June 30, 2011
|
Six Months Ended
June 30, 2010
|
|||||||||||
Average Recorded Investment Balance
|
Interest
Income Recognized (1)
|
Average Recorded Investment Balance
|
Interest
Income Recognized (1)
|
|||||||||
Commercial and industrial
|
$
|
51,863
|
$
|
10
|
$
|
31,934
|
$
|
83
|
||||
Agricultural
|
1,796
|
-
|
1,862
|
-
|
||||||||
Commercial real estate:
|
||||||||||||
Office, retail, and industrial
|
18,989
|
21
|
20,987
|
7
|
||||||||
Multi-family
|
4,736
|
2
|
9,172
|
-
|
||||||||
Residential construction
|
41,455
|
27
|
100,110
|
75
|
||||||||
Commercial construction
|
25,191
|
-
|
20,209
|
-
|
||||||||
Other commercial real estate
|
37,968
|
18
|
25,967
|
-
|
||||||||
Total commercial real estate
|
128,339
|
68
|
176,445
|
82
|
||||||||
Total impaired loans individually evaluated for
impairment
|
$
|
181,998
|
$
|
78
|
$
|
210,241
|
$
|
165
|
(1)
|
Recorded using the cash basis of accounting.
|
Pass
|
Special Mention (1)
|
Substandard / Accrual (2)
|
Substandard / Non-accrual (3)
|
Total
|
|||||||||||
June 30, 2011
|
|||||||||||||||
Commercial and industrial
|
$
|
1,337,553
|
$
|
77,305
|
$
|
59,521
|
$
|
44,393
|
$
|
1,518,772
|
|||||
Agricultural
|
223,260
|
13,249
|
-
|
1,009
|
237,518
|
||||||||||
Commercial real estate:
|
|||||||||||||||
Office, retail, and industrial
|
1,058,059
|
113,657
|
40,817
|
16,567
|
1,229,100
|
||||||||||
Multi-family
|
290,077
|
7,213
|
15,463
|
23,385
|
336,138
|
||||||||||
Residential construction
|
48,344
|
27,305
|
30,102
|
23,576
|
129,327
|
||||||||||
Commercial construction
|
72,237
|
34,291
|
18,702
|
21,449
|
146,679
|
||||||||||
Other commercial real estate
|
712,785
|
82,614
|
20,583
|
36,984
|
852,966
|
||||||||||
Total commercial real estate
|
2,181,502
|
265,080
|
125,667
|
121,961
|
2,694,210
|
||||||||||
Total corporate loans
|
$
|
3,742,315
|
$
|
355,634
|
$
|
185,188
|
$
|
167,363
|
$
|
4,450,500
|
|||||
December 31, 2010
|
|||||||||||||||
Commercial and industrial
|
$
|
1,303,142
|
$
|
83,259
|
$
|
29,414
|
$
|
50,088
|
$
|
1,465,903
|
|||||
Agricultural
|
209,317
|
15,667
|
275
|
2,497
|
227,756
|
||||||||||
Commercial real estate:
|
|||||||||||||||
Office, retail, and industrial
|
1,026,124
|
123,800
|
34,116
|
19,573
|
1,203,613
|
||||||||||
Multi-family
|
307,845
|
20,643
|
15,171
|
6,203
|
349,862
|
||||||||||
Residential construction
|
57,209
|
35,950
|
29,409
|
52,122
|
174,690
|
||||||||||
Commercial construction
|
85,305
|
35,750
|
14,732
|
28,685
|
164,472
|
||||||||||
Other commercial real estate
|
697,971
|
89,247
|
28,534
|
40,605
|
856,357
|
||||||||||
Total commercial real estate
|
2,174,454
|
305,390
|
121,962
|
147,188
|
2,748,994
|
||||||||||
Total corporate loans
|
$
|
3,686,913
|
$
|
404,316
|
$
|
151,651
|
$
|
199,773
|
$
|
4,442,653
|
Performing
|
Non-accrual
|
Total
|
|||||||
June 30, 2011
|
|||||||||
Home equity
|
$
|
424,404
|
$
|
5,519
|
$
|
429,923
|
|||
1-4 family mortgages
|
180,425
|
4,577
|
185,002
|
||||||
Installment loans
|
47,450
|
36
|
47,486
|
||||||
Total consumer loans
|
$
|
652,279
|
$
|
10,132
|
$
|
662,411
|
|||
December 31, 2010
|
|||||||||
Home equity
|
$
|
437,295
|
$
|
7,948
|
$
|
445,243
|
|||
1-4 family mortgages
|
156,988
|
3,902
|
160,890
|
||||||
Installment loans
|
51,615
|
159
|
51,774
|
||||||
Total consumer loans
|
$
|
645,898
|
$
|
12,009
|
$
|
657,907
|
(1)
|
Loans categorized as special mention have potential weaknesses that deserve the close attention of management. If left uncorrected, these potential weaknesses may result in the deterioration of repayment prospects or in the credit position of the Company at some future date.
|
(2)
|
Loans categorized as substandard/accrual continue to accrue interest, but exhibit a well-defined weakness or weaknesses that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well secured and collection of principal and interest is expected within a reasonable time.
|
(3)
|
Loans categorized as substandard/non-accrual exhibit a well-defined weakness or weaknesses that may jeopardize the liquidation of the debt and are characterized by the distinct possibility that the Company could sustain some loss if the deficiencies are not corrected. These loans have been placed on non-accrual status.
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Net income
|
$
|
10,828
|
$
|
7,809
|
$
|
21,046
|
$
|
15,890
|
||||
Preferred dividends
|
(2,412)
|
(2,412)
|
(4,825)
|
(4,825)
|
||||||||
Accretion on preferred stock
|
(170)
|
(161)
|
(338)
|
(320)
|
||||||||
Net income applicable to non-vested restricted shares
|
( 102)
|
( 65)
|
( 242)
|
( 146)
|
||||||||
Net income applicable to common shares
|
$
|
8,144
|
$
|
5,171
|
$
|
15,641
|
$
|
10,599
|
||||
Weighted-average common shares outstanding:
|
||||||||||||
Weighted-average common shares outstanding (basic)
|
73,259
|
73,028
|
73,205
|
71,756
|
||||||||
Dilutive effect of common stock equivalents
|
-
|
-
|
-
|
-
|
||||||||
Weighted-average diluted common shares outstanding
|
73,259
|
73,028
|
73,205
|
71,756
|
||||||||
Basic earnings per share
|
$
|
0.11
|
$
|
0.07
|
$
|
0.21
|
$
|
0.15
|
||||
Diluted earnings per share
|
$
|
0.11
|
$
|
0.07
|
$
|
0.21
|
$
|
0.15
|
||||
Anti-dilutive shares not included in the computation of
diluted earnings per share (1)
|
3,619
|
3,810
|
3,676
|
3,848
|
(1)
|
Represents outstanding stock options and common stock warrants for which the exercise price is greater than the average market price of the Company’s common stock.
|
Six Months Ended June 30, 2011
|
Six Months Ended June 30, 2010
|
|||||||||||||||||
Before
Tax
|
Tax
Effect
|
Net of
Tax
|
Before
Tax
|
Tax
Effect
|
Net of
Tax
|
|||||||||||||
Securities available-for-sale:
|
||||||||||||||||||
Unrealized holding gains
|
$
|
22,386
|
$
|
8,762
|
$
|
13,624
|
$
|
13,763
|
$
|
5,351
|
$
|
8,412
|
||||||
Less: Reclassification of net gains
included in net income
|
2,071
|
847
|
1,224
|
4,178
|
1,629
|
2,549
|
||||||||||||
Net unrealized holding gains
|
20,315
|
7,915
|
12,400
|
9,585
|
3,722
|
5,863
|
||||||||||||
Total other comprehensive income
|
$
|
20,315
|
$
|
7,915
|
$
|
12,400
|
$
|
9,585
|
$
|
3,722
|
$
|
5,863
|
Accumulated
Unrealized
Loss on Securities
Available-for-Sale
|
Unrecognized Net Pension Costs
|
Total
Accumulated
Other
Comprehensive
Loss
|
|||||||
Balance at January 1, 2010
|
$
|
(13,015)
|
$
|
(5,651)
|
$
|
(18,666)
|
|||
Other comprehensive income
|
5,863
|
-
|
5,863
|
||||||
Balance at June 30, 2010
|
$
|
(7,152)
|
$
|
(5,651)
|
$
|
(12,803)
|
|||
Balance at January 1, 2011
|
$
|
(19,806)
|
$
|
(7,933)
|
$
|
(27,739)
|
|||
Other comprehensive income
|
12,400
|
-
|
12,400
|
||||||
Balance at June 30, 2011
|
$
|
(7,406)
|
$
|
(7,933)
|
$
|
(15,339)
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Income before income tax expense (benefit)
|
$
|
13,669
|
$
|
7,948
|
$
|
23,917
|
$
|
16,384
|
||||
Income tax expense (benefit):
|
||||||||||||
Federal income tax expense (benefit)
|
$
|
1,669
|
$
|
(244)
|
$
|
2,683
|
$
|
(282)
|
||||
State income tax expense
|
1,172
|
383
|
188
|
776
|
||||||||
Total income tax expense
|
$
|
2,841
|
$
|
139
|
$
|
2,871
|
$
|
494
|
||||
Effective income tax rate
|
20.8%
|
1.7%
|
12.0%
|
3.0%
|
June 30,
2011
|
December 31,
2010
|
|||||
Commitments to extend credit:
|
||||||
Home equity lines
|
$
|
271,138
|
$
|
275,826
|
||
Credit card lines to businesses
|
28,129
|
26,376
|
||||
1-4 family real estate construction
|
26,159
|
26,682
|
||||
Commercial real estate
|
158,092
|
175,608
|
||||
Commercial and industrial
|
568,553
|
553,168
|
||||
Overdraft protection program (1)
|
177,344
|
169,824
|
||||
All other commitments
|
132,096
|
97,299
|
||||
Total commitments
|
$
|
1,361,511
|
$
|
1,324,783
|
||
Letters of credit:
|
||||||
1-4 family real estate construction
|
$
|
10,608
|
$
|
10,551
|
||
Commercial real estate
|
50,104
|
54,896
|
||||
All other
|
74,194
|
74,594
|
||||
Total letters of credit
|
$
|
134,906
|
$
|
140,041
|
||
Unamortized fees associated with letters of credit (2) (3)
|
$
|
759
|
$
|
696
|
||
Remaining weighted-average term (in months)
|
10.1
|
12.2
|
||||
Remaining lives (in years)
|
0.1 to 4.5
|
0.1 to 9.5
|
||||
Recourse on securitized assets:
|
||||||
Unpaid principal balance of assets securitized
|
$
|
7,301
|
$
|
7,424
|
||
Cap on recourse obligation
|
$
|
2,208
|
$
|
2,208
|
||
Carrying value of recourse obligation (2)
|
$
|
148
|
$
|
148
|
(1)
|
Federal regulation regarding electronic fund transfers require consumers to affirmatively consent to the institution’s overdraft service for automated teller machine and one-time debit card transactions before overdraft fees may be assessed on the account. Consumers are provided a specific line for the amount they may overdraw.
|
(2)
|
Included in other liabilities in the Consolidated Statements of Financial Condition.
|
(3)
|
The Company will amortize these amounts into income over the commitment period.
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Recourse loans repurchased during the period
|
$
|
-
|
$
|
114
|
$
|
-
|
$
|
114
|
||||
Recourse loans charged-off during the period
|
$
|
-
|
$
|
36
|
$
|
-
|
$
|
36
|
·
|
Level 1 – Quoted prices in active markets for identical assets or liabilities.
|
·
|
Level 2 – Observable inputs other than level 1 prices, such as quoted prices for similar instruments; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability.
|
·
|
Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
June 30, 2011
|
||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||
Assets and liabilities measured at fair value on a recurring basis
|
||||||||||||
Assets:
|
||||||||||||
Trading securities:
|
||||||||||||
Money market funds
|
$
|
1,152
|
$
|
-
|
$
|
-
|
$
|
1,152
|
||||
Mutual funds
|
15,078
|
-
|
-
|
15,078
|
||||||||
Total trading securities
|
16,230
|
-
|
-
|
16,230
|
||||||||
Securities available-for-sale:
|
||||||||||||
U.S. agency securities
|
-
|
8,113
|
-
|
8,113
|
||||||||
CMOs
|
-
|
376,702
|
-
|
376,702
|
||||||||
Other residential mortgage-backed securities
|
-
|
97,805
|
-
|
97,805
|
||||||||
Municipal securities
|
-
|
479,919
|
-
|
479,919
|
||||||||
CDOs
|
-
|
-
|
16,487
|
16,487
|
||||||||
Corporate debt securities
|
-
|
27,922
|
-
|
27,922
|
||||||||
Hedge fund investment
|
-
|
1,882
|
-
|
1,882
|
||||||||
Other equity securities
|
39
|
1,004
|
-
|
1,043
|
||||||||
Total securities available-for-sale
|
39
|
993,347
|
16,487
|
1,009,873
|
||||||||
Mortgage servicing rights (1)
|
-
|
-
|
840
|
840
|
||||||||
Total assets
|
$
|
16,269
|
$
|
993,347
|
$
|
17,327
|
$
|
1,026,943
|
||||
Liabilities:
|
||||||||||||
Derivative liabilities (1)
|
$
|
-
|
$
|
1,877
|
$
|
-
|
$
|
1,877
|
||||
Assets measured at fair value on a non-recurring basis
|
||||||||||||
Collateral-dependent impaired loans (2)
|
$
|
-
|
$
|
-
|
$
|
85,101
|
$
|
85,101
|
||||
OREO (3)
|
-
|
-
|
38,990
|
38,990
|
||||||||
Loan held-for-sale (4)
|
-
|
-
|
1,595
|
1,595
|
||||||||
Asset held-for-sale (5)
|
-
|
-
|
7,928
|
7,928
|
||||||||
Total assets
|
$
|
-
|
$
|
-
|
$
|
133,614
|
$
|
133,614
|
December 31, 2010
|
||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||
Assets and liabilities measured at fair value on a recurring basis
|
||||||||||||
Assets:
|
||||||||||||
Trading securities:
|
||||||||||||
Money market funds
|
$
|
1,196
|
$
|
-
|
$
|
-
|
$
|
1,196
|
||||
Mutual funds
|
14,086
|
-
|
-
|
14,086
|
||||||||
Total trading securities
|
15,282
|
-
|
-
|
15,282
|
||||||||
Securities available-for-sale:
|
||||||||||||
U.S. agency securities
|
-
|
17,886
|
-
|
17,886
|
||||||||
CMOs
|
-
|
379,589
|
-
|
379,589
|
||||||||
Other residential mortgage-backed securities
|
-
|
106,451
|
-
|
106,451
|
||||||||
Municipal securities
|
-
|
503,991
|
-
|
503,991
|
||||||||
CDOs
|
-
|
-
|
14,858
|
14,858
|
||||||||
Corporate debt securities
|
-
|
32,345
|
-
|
32,345
|
||||||||
Hedge fund investment
|
-
|
1,683
|
-
|
1,683
|
||||||||
Other equity securities
|
38
|
961
|
-
|
999
|
||||||||
Total securities available-for-sale
|
38
|
1,042,906
|
14,858
|
1,057,802
|
||||||||
Mortgage servicing rights (1)
|
-
|
-
|
942
|
942
|
||||||||
Total assets
|
$
|
15,320
|
$
|
1,042,906
|
$
|
15,800
|
$
|
1,074,026
|
||||
Liabilities:
|
||||||||||||
Derivative liabilities (1)
|
$
|
-
|
$
|
1,833
|
$
|
-
|
$
|
1,833
|
||||
Assets measured at fair value on a non-recurring basis
|
||||||||||||
Collateral-dependent impaired loans (2)
|
$
|
-
|
$
|
-
|
$
|
125,258
|
$
|
125,258
|
||||
OREO (3)
|
-
|
-
|
53,439
|
53,439
|
||||||||
Total assets
|
$
|
-
|
$
|
-
|
$
|
178,697
|
$
|
178,697
|
(1)
|
Mortgage servicing rights are included in other assets, and derivative liabilities are included in other liabilities in the Consolidated Statements of Financial Condition.
|
(2)
|
Represents the carrying value of loans for which adjustments are based on the appraised or market-quoted value of the collateral, net of selling costs. Collateral-dependent loans for which no fair value adjustments were necessary during the six months ended June 30, 2011 are not included.
|
(3)
|
Represents the estimated fair value, net of selling costs, based on appraised value and includes covered OREO.
|
(4)
|
Included in other assets in the Consolidated Statements of Financial Condition.
|
(5)
|
Included in premises, furniture, and equipment in the Consolidated Statements of Financial Condition.
|
Collateralized
Mortgage
Obligations
|
Other Mortgage-
Backed
Securities
|
|||
Weighted-average coupon rate
|
|
4.9%
|
5.3%
|
|
Weighted-average maturity (in years)
|
2.4
|
4.4
|
||
Information on underlying residential mortgages:
|
||||
Origination dates
|
2000 to 2010
|
2000 to 2010
|
||
Weighted-average coupon rate
|
5.8%
|
5.8%
|
||
Weighted-average maturity (in years)
|
9.1
|
7.4
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Balance at beginning of period
|
$
|
16,193
|
$
|
12,178
|
$
|
14,858
|
$
|
11,728
|
||||
Total income (loss):
|
||||||||||||
Included in earnings (1)
|
-
|
(1,049)
|
-
|
(3,812)
|
||||||||
Included in other comprehensive income
|
294
|
2,535
|
1,629
|
5,748
|
||||||||
Balance at end of period
|
$
|
16,487
|
$
|
13,664
|
$
|
16,487
|
$
|
13,664
|
||||
Change in unrealized losses recognized in earnings relating
to securities still held at end of period
|
$
|
-
|
$
|
(1,049)
|
$
|
-
|
$
|
(3,812)
|
(1)
|
Included in securities gains, net in the Consolidated Statements of Income.
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||
Balance at beginning of period
|
$
|
845
|
$
|
1,197
|
$
|
942
|
$
|
1,238
|
||||
Total (losses) gains included in earnings (1):
|
||||||||||||
Due to changes in valuation inputs and assumptions (2)
|
28
|
(2)
|
(10)
|
23
|
||||||||
Other changes in fair value (3)
|
(33)
|
(62)
|
(92)
|
(128)
|
||||||||
Balance at end of period
|
$
|
840
|
$
|
1,133
|
$
|
840
|
$
|
1,133
|
||||
Key economic assumptions used in measuring fair value, at end
of period:
|
||||||||||||
Weighted-average prepayment speed
|
18.7%
|
16.1%
|
18.7%
|
16.1%
|
||||||||
Weighted-average discount rate
|
11.5%
|
11.4%
|
11.5%
|
11.4%
|
||||||||
Weighted-average maturity, in months
|
198.5
|
205.8
|
198.5
|
205.8
|
||||||||
Contractual servicing fees earned during the period (1)
|
$
|
60
|
$
|
74
|
$
|
123
|
$
|
158
|
June 30,
2011
|
December 31,
2010
|
|||||
Total amount of loans being serviced for the benefit of others at end of period (4)
|
$
|
88,091
|
$
|
114,720
|
(1)
|
Included in other service charges, commissions, and fees in the Consolidated Statements of Income and relate to mortgage servicing rights still held at the end of the period.
|
(2)
|
Principally reflects changes in prepayment speed assumptions.
|
(3)
|
Primarily represents changes in expected cash flows over time due to payoffs and paydowns.
|
(4)
|
These loans are serviced for and owned by third parties and are not included in the Consolidated Statements of Financial Condition.
|
Quarter Ended
June 30, 2011
|
Six Months Ended
June 30, 2011
|
|||||||||||
Charged to Allowance for Loan Losses
|
Charged to Earnings
|
Charged to Allowance for Loan Losses
|
Charged to Earnings
|
|||||||||
Collateral-dependent impaired loans
|
$
|
19,459
|
$
|
-
|
$
|
36,269
|
$
|
-
|
||||
OREO
|
-
|
1,523
|
-
|
2,635
|
||||||||
Loans held-for-sale
|
-
|
-
|
200
|
-
|
||||||||
Assets held-for-sale
|
-
|
286
|
-
|
596
|
June 30, 2011
|
December 31, 2010
|
|||||||||||
Carrying
Amount
|
Estimated
Fair Value
|
Carrying
Amount
|
Estimated
Fair Value
|
|||||||||
Financial Assets:
|
||||||||||||
Cash and due from banks
|
$
|
110,159
|
$
|
110,159
|
$
|
102,495
|
$
|
102,495
|
||||
Interest-bearing deposits in other banks
|
601,310
|
601,310
|
483,281
|
483,281
|
||||||||
Loans held-for-sale
|
1,595
|
1,595
|
236
|
236
|
||||||||
Trading securities
|
16,230
|
16,230
|
15,282
|
15,282
|
||||||||
Securities available-for-sale
|
1,009,873
|
1,009,873
|
1,057,802
|
1,057,802
|
||||||||
Securities held-to-maturity
|
76,142
|
78,485
|
81,320
|
82,525
|
||||||||
Loans, net of allowance for loan losses
|
5,290,522
|
5,306,598
|
5,329,717
|
5,323,830
|
||||||||
FDIC indemnification asset
|
95,752
|
95,752
|
95,899
|
95,899
|
||||||||
Accrued interest receivable
|
28,883
|
28,883
|
29,953
|
29,953
|
||||||||
Investment in bank-owned life insurance
|
198,149
|
198,149
|
197,644
|
197,644
|
||||||||
Financial Liabilities:
|
||||||||||||
Deposits
|
$
|
6,495,549
|
$
|
6,494,373
|
$
|
6,511,476
|
$
|
6,512,626
|
||||
Borrowed funds
|
272,024
|
275,540
|
303,974
|
306,703
|
||||||||
Subordinated debt
|
137,748
|
132,145
|
137,744
|
122,261
|
||||||||
Accrued interest payable
|
3,650
|
3,650
|
4,557
|
4,557
|
||||||||
Derivative liabilities
|
1,877
|
1,877
|
1,833
|
1,833
|
||||||||
Standby letters of credit
|
759
|
759
|
696
|
696
|
Quarters Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||||||
2011
|
2010
|
% Change
|
2011
|
2010
|
% Change
|
|||||||||||
Operating Results
|
||||||||||||||||
Interest income
|
$
|
81,296
|
$
|
82,274
|
( 1.2)
|
$
|
162,579
|
$
|
164,053
|
( 0.9)
|
||||||
Interest expense
|
(9,935)
|
(12,655)
|
( 21.5)
|
(20,572)
|
(26,496)
|
( 22.4)
|
||||||||||
Net interest income
|
71,361
|
69,619
|
2.5
|
142,007
|
137,557
|
3.2
|
||||||||||
Fee-based revenues
|
24,205
|
21,879
|
10.6
|
45,908
|
41,918
|
9.5
|
||||||||||
Other noninterest income
|
758
|
7
|
N/M
|
2,732
|
1,232
|
121.8
|
||||||||||
Noninterest expense, excluding losses
realized on other real estate owned
(“OREO”) and costs associated with
Federal Deposit Insurance Corporation
(“FDIC”)-assisted transactions (2)
|
(62,000)
|
(56,759)
|
9.2
|
(124,896)
|
(114,224)
|
9.3
|
||||||||||
Pre-tax, pre-provision core operating
earnings (3)
|
34,324
|
34,746
|
( 1.2)
|
65,751
|
66,483
|
( 1.1)
|
||||||||||
Provision for loan losses
|
(18,763)
|
(21,526)
|
( 12.8)
|
(38,255)
|
(39,876)
|
( 4.1)
|
||||||||||
Securities gains, net
|
1,531
|
2,255
|
( 32.1)
|
2,071
|
8,075
|
( 74.4)
|
||||||||||
Securities impairment losses
|
-
|
(1,134)
|
( 100.0)
|
-
|
(3,897)
|
( 100.0)
|
||||||||||
Gain on FDIC-assisted transaction
|
-
|
4,303
|
( 100.0)
|
-
|
4,303
|
( 100.0)
|
||||||||||
Integration costs associated with FDIC-
assisted transactions (2)
|
-
|
(1,772)
|
( 100.0)
|
-
|
(1,901)
|
( 100.0)
|
||||||||||
Write-downs of OREO (2)
|
(1,523)
|
(3,272)
|
( 53.5)
|
(2,635)
|
(5,610)
|
( 53.0)
|
||||||||||
Losses on sales of OREO, net (2)
|
(1,900)
|
(5,652)
|
( 66.4)
|
(3,015)
|
(11,193)
|
( 73.1)
|
||||||||||
Income before income tax expense
|
13,669
|
7,948
|
72.0
|
23,917
|
16,384
|
46.0
|
||||||||||
Income tax expense
|
(2,841)
|
( 139)
|
N/M
|
(2,871)
|
( 494)
|
N/M
|
||||||||||
Net income
|
10,828
|
7,809
|
38.7
|
21,046
|
15,890
|
32.4
|
||||||||||
Preferred dividends and accretion
|
(2,582)
|
(2,573)
|
0.3
|
(5,163)
|
(5,145)
|
0.3
|
||||||||||
Net income applicable to non-vested
restricted shares
|
( 102)
|
( 65)
|
56.9
|
( 242)
|
( 146)
|
65.8
|
||||||||||
Net income applicable to common shares
|
$
|
8,144
|
$
|
5,171
|
57.5
|
$
|
15,641
|
$
|
10,599
|
47.6
|
||||||
Weighted average diluted shares outstanding
|
73,259
|
73,028
|
73,205
|
71,756
|
||||||||||||
Diluted earnings per common share
|
$
|
0.11
|
$
|
0.07
|
$
|
0.21
|
$
|
0.15
|
||||||||
Performance Ratios (1)
|
||||||||||||||||
Return on average common equity
|
3.47%
|
2.16%
|
3.37%
|
2.27%
|
||||||||||||
Return on average assets
|
0.53%
|
0.40%
|
0.52%
|
0.41%
|
||||||||||||
Net interest margin – tax equivalent
|
4.10%
|
4.21%
|
4.13%
|
4.25%
|
||||||||||||
Efficiency ratio
|
60.19%
|
57.92%
|
61.29%
|
58.16%
|
(1)
|
All ratios are presented on an annualized basis.
|
(2)
|
For further discussion of losses realized on OREO and integration costs associated with FDIC-assisted transactions, see the section titled “Noninterest Expense.”
|
(3)
|
Our accounting and reporting policies conform to U.S. generally accepted accounting principles (“GAAP”) and general practice within the banking industry. As a supplement to GAAP, we have provided this non-GAAP performance result. We believe that this non-GAAP financial measure is useful because it allows investors to assess our operating performance. Although this non-GAAP financial measure is intended to enhance investors’ understanding of our business and performance, this non-GAAP financial measure should not be considered an alternative to GAAP. This measure may differ from other similarly named measures used by other companies.
|
June 30,
2011
|
December 31,
2010
|
June 30,
2010
|
June 30, 2011 Change From
|
||||||||||||
December 31,
2010
|
June 30,
2010
|
||||||||||||||
Balance Sheet Highlights
|
|||||||||||||||
Total assets
|
$
|
8,129,391
|
$
|
8,138,302
|
$
|
7,805,089
|
$
|
(8,911)
|
$
|
324,302
|
|||||
Total loans, excluding covered loans
|
5,112,911
|
5,100,560
|
5,208,347
|
12,351
|
(95,436)
|
||||||||||
Total loans, including covered loans
|
5,427,853
|
5,472,289
|
5,373,271
|
(44,436)
|
54,582
|
||||||||||
Total deposits
|
6,495,549
|
6,511,476
|
6,123,565
|
(15,927)
|
371,984
|
||||||||||
Transactional deposits
|
4,731,329
|
4,519,492
|
4,218,383
|
211,837
|
512,946
|
||||||||||
Loans to deposits ratio
|
83.6%
|
84.0%
|
87.7%
|
||||||||||||
Transactional deposits to total deposits
|
72.8%
|
69.4%
|
68.9%
|
June 30,
2011
|
December 31,
2010
|
June 30,
2010
|
June 30, 2011 Change From
|
||||||||||||
December 31,
2010
|
June 30,
2010
|
||||||||||||||
Asset Quality Highlights (1)
|
|||||||||||||||
Non-accrual loans
|
$
|
177,495
|
$
|
211,782
|
$
|
193,689
|
$
|
(34,287)
|
$
|
(16,194)
|
|||||
90 days or more past due loans (still
accruing interest)
|
6,502
|
4,244
|
6,280
|
2,258
|
222
|
||||||||||
Total non-performing loans
|
183,997
|
216,026
|
199,969
|
(32,029)
|
(15,972)
|
||||||||||
Restructured loans (still accruing
interest)
|
14,529
|
22,371
|
9,030
|
(7,842)
|
5,499
|
||||||||||
Other real estate owned
|
24,407
|
31,069
|
57,023
|
(6,662)
|
(32,616)
|
||||||||||
Total non-performing assets
|
$
|
222,933
|
$
|
269,466
|
$
|
266,022
|
$
|
(46,533)
|
$
|
(43,089)
|
|||||
30-89 days past due loans (still
accruing interest)
|
$
|
30,424
|
$
|
23,646
|
$
|
32,012
|
$
|
6,778
|
$
|
(1,588)
|
|||||
Allowance for credit losses
|
$
|
139,831
|
$
|
145,072
|
$
|
145,477
|
$
|
(5,241)
|
$
|
(5,646)
|
|||||
Allowance for credit losses as a
percent of loans
|
2.73%
|
2.84%
|
2.79%
|
(1)
|
Excludes covered loans and covered OREO. For a discussion of covered assets, refer to Note 5 of “Notes to Consolidated Financial Statements” in Item 1 of this Form 10-Q. Asset quality, including covered loans and covered OREO, is included in the section titled “Loan Portfolio and Credit Quality” elsewhere in this report.
|
Quarters Ended June 30,
|
Attribution of Change
in Net Interest Income (1)
|
||||||||||||||||||||||||||
2011
|
2010
|
||||||||||||||||||||||||||
Average
Balance
|
Interest
|
Yield/
Rate
(%)
|
Average
Balance
|
Interest
|
Yield/
Rate
(%)
|
Volume
|
Yield/
Rate
|
Total
|
|||||||||||||||||||
Assets:
|
|||||||||||||||||||||||||||
Federal funds sold and other
short-term investments
|
$
|
566,315
|
$
|
341
|
0.24
|
$
|
300,346
|
$
|
176
|
0.24
|
$
|
160
|
$
|
5
|
$
|
165
|
|||||||||||
Trading securities
|
16,255
|
23
|
0.57
|
14,134
|
27
|
0.76
|
5
|
( 9)
|
( 4)
|
||||||||||||||||||
Investment securities (2)
|
1,150,221
|
12,933
|
4.50
|
1,213,455
|
17,592
|
5.80
|
(878)
|
(3,781)
|
(4,659)
|
||||||||||||||||||
Federal Home Loan Bank and
Federal Reserve Bank stock
|
59,745
|
340
|
2.28
|
59,758
|
335
|
2.24
|
-
|
5
|
5
|
||||||||||||||||||
Loans, excluding covered
loans (2)
|
5,108,234
|
63,521
|
4.99
|
5,204,566
|
65,811
|
5.07
|
(1,182)
|
(1,108)
|
(2,290)
|
||||||||||||||||||
Covered interest-earning assets (3)
|
420,108
|
7,655
|
7.31
|
233,907
|
2,598
|
4.45
|
2,802
|
2,255
|
5,057
|
||||||||||||||||||
Total loans
|
5,528,342
|
71,176
|
5.16
|
5,438,473
|
68,409
|
5.05
|
1,620
|
1,147
|
2,767
|
||||||||||||||||||
Total interest-earning
assets (2)
|
7,320,878
|
84,813
|
4.64
|
7,026,166
|
86,539
|
4.94
|
907
|
(2,633)
|
(1,726)
|
||||||||||||||||||
Cash and due from banks
|
120,599
|
170,524
|
|||||||||||||||||||||||||
Allowance for loan losses
|
(148,092)
|
(153,537)
|
|||||||||||||||||||||||||
Other assets
|
877,710
|
862,211
|
|||||||||||||||||||||||||
Total assets
|
$
|
8,171,095
|
$
|
7,905,364
|
|||||||||||||||||||||||
Liabilities and Stockholders’ Equity:
|
|||||||||||||||||||||||||||
Savings deposits
|
$
|
944,802
|
485
|
0.21
|
$
|
803,353
|
629
|
0.31
|
151
|
( 295)
|
( 144)
|
||||||||||||||||
NOW accounts
|
1,126,913
|
316
|
0.11
|
1,157,246
|
548
|
0.19
|
(14)
|
( 218)
|
( 232)
|
||||||||||||||||||
Money market deposits
|
1,205,736
|
789
|
0.26
|
1,155,889
|
1,712
|
0.59
|
77
|
(1,000)
|
( 923)
|
||||||||||||||||||
Time deposits
|
1,813,164
|
5,379
|
1.19
|
1,916,116
|
6,737
|
1.41
|
(347)
|
(1,011)
|
(1,358)
|
||||||||||||||||||
Borrowed funds
|
262,525
|
687
|
1.05
|
342,808
|
749
|
0.88
|
(402)
|
340
|
( 62)
|
||||||||||||||||||
Subordinated debt
|
137,747
|
2,279
|
6.64
|
137,738
|
2,280
|
6.64
|
-
|
( 1)
|
( 1)
|
||||||||||||||||||
Total interest-bearing
liabilities
|
5,490,887
|
9,935
|
0.73
|
5,513,150
|
12,655
|
0.92
|
( 535)
|
(2,185)
|
(2,720)
|
||||||||||||||||||
Demand deposits
|
1,465,438
|
1,181,097
|
|
||||||||||||||||||||||||
Other liabilities
|
80,000
|
58,723
|
|||||||||||||||||||||||||
Stockholders’ equity - common
|
941,770
|
959,394
|
|||||||||||||||||||||||||
Stockholders’ equity - preferred
|
193,000
|
193,000
|
|||||||||||||||||||||||||
Total liabilities and
stockholders’ equity
|
$
|
8,171,095
|
$
|
7,905,364
|
|||||||||||||||||||||||
Net interest income/margin (2)
|
$
|
74,878
|
4.10
|
$
|
73,884
|
4.21
|
$
|
1,442
|
$
|
( 448)
|
$
|
994
|
|||||||||||||||
Net interest income (GAAP)
|
$
|
71,361
|
$
|
69,619
|
|||||||||||||||||||||||
Tax equivalent adjustment
|
3,517
|
4,265
|
|||||||||||||||||||||||||
Tax-equivalent net interest
income
|
$
|
74,878
|
$
|
73,884
|
(1)
|
For purposes of this table, changes which are not due solely to volume changes or rate changes are allocated to such categories on the basis of the percentage relationship of each to the sum of the two.
|
(2)
|
Interest income and yields are presented on a tax-equivalent basis, assuming a federal income tax rate of 35%.
|
(3)
|
Covered interest-earning assets consist of loans acquired through FDIC-assisted transactions and the related FDIC indemnification asset. For additional discussion, please refer to the section titled “Covered Assets.”
|
Six Months Ended June 30,
|
Attribution of Change
in Net Interest Income (1)
|
||||||||||||||||||||||||||
2011
|
2010
|
||||||||||||||||||||||||||
Average
Balance
|
Interest
|
Yield/
Rate
(%)
|
Average
Balance
|
Interest
|
Yield/
Rate
(%)
|
Volume
|
Yield/
Rate
|
Total
|
|||||||||||||||||||
Assets:
|
|||||||||||||||||||||||||||
Federal funds sold and other
short-term investments
|
$
|
517,370
|
$
|
633
|
0.25
|
$
|
171,386
|
$
|
203
|
0.24
|
$
|
423
|
$
|
7
|
$
|
430
|
|||||||||||
Trading securities
|
15,816
|
53
|
0.67
|
14,208
|
57
|
0.80
|
10
|
( 14)
|
( 4)
|
||||||||||||||||||
Investment securities (2)
|
1,158,560
|
25,981
|
4.49
|
1,255,908
|
35,471
|
5.65
|
(2,594)
|
(6,896)
|
(9,490)
|
||||||||||||||||||
Federal Home Loan Bank and
Federal Reserve Bank stock
|
60,537
|
697
|
2.30
|
59,130
|
663
|
2.24
|
16
|
18
|
34
|
||||||||||||||||||
Loans, excluding covered
loans (2)
|
5,092,126
|
126,822
|
5.02
|
5,201,052
|
130,616
|
5.06
|
(2,743)
|
(1,051)
|
(3,794)
|
||||||||||||||||||
Covered interest-earning assets (3)
|
432,108
|
15,477
|
7.22
|
221,355
|
5,560
|
5.07
|
6,852
|
3,065
|
9,917
|
||||||||||||||||||
Total loans
|
5,524,234
|
142,299
|
5.19
|
5,422,407
|
136,176
|
5.06
|
4,109
|
2,014
|
6,123
|
||||||||||||||||||
Total interest-earning
assets (2)
|
7,276,517
|
169,663
|
4.70
|
6,923,039
|
172,570
|
5.02
|
1,964
|
(4,871)
|
(2,907)
|
||||||||||||||||||
Cash and due from banks
|
121,043
|
141,640
|
|||||||||||||||||||||||||
Allowance for loan losses
|
(148,072)
|
(153,015)
|
|||||||||||||||||||||||||
Other assets
|
883,745
|
874,571
|
|||||||||||||||||||||||||
Total assets
|
$
|
8,133,233
|
$
|
7,786,235
|
|||||||||||||||||||||||
Liabilities and Stockholders’ Equity:
|
|||||||||||||||||||||||||||
Savings deposits
|
$
|
923,124
|
961
|
0.21
|
$
|
781,690
|
1,243
|
0.32
|
311
|
( 593)
|
( 282)
|
||||||||||||||||
NOW accounts
|
1,085,825
|
636
|
0.12
|
1,040,362
|
1,057
|
0.20
|
48
|
( 469)
|
( 421)
|
||||||||||||||||||
Money market deposits
|
1,222,991
|
1,649
|
0.27
|
1,133,329
|
3,500
|
0.62
|
302
|
(2,153)
|
(1,851)
|
||||||||||||||||||
Time deposits
|
1,875,183
|
11,394
|
1.23
|
1,936,319
|
14,371
|
1.50
|
(442)
|
(2,535)
|
(2,977)
|
||||||||||||||||||
Borrowed funds
|
274,122
|
1,367
|
1.01
|
409,694
|
1,759
|
0.87
|
(766)
|
374
|
( 392)
|
||||||||||||||||||
Subordinated debt
|
137,746
|
4,565
|
6.68
|
137,737
|
4,566
|
6.68
|
-
|
( 1)
|
( 1)
|
||||||||||||||||||
Total interest-bearing
liabilities
|
5,518,991
|
20,572
|
0.75
|
5,439,131
|
26,496
|
0.98
|
( 547)
|
(5,377)
|
(5,924)
|
||||||||||||||||||
Demand deposits
|
1,404,066
|
1,152,865
|
|
||||||||||||||||||||||||
Other liabilities
|
81,599
|
58,019
|
|||||||||||||||||||||||||
Stockholders’ equity - common
|
935,577
|
943,220
|
|||||||||||||||||||||||||
Stockholders’ equity - preferred
|
193,000
|
193,000
|
|||||||||||||||||||||||||
Total liabilities and
stockholders’ equity
|
$
|
8,133,233
|
$
|
7,786,235
|
|||||||||||||||||||||||
Net interest income/margin (2)
|
$
|
149,091
|
4.13
|
$
|
146,074
|
4.25
|
$
|
2,511
|
$
|
506
|
$
|
3,017
|
|||||||||||||||
Net interest income (GAAP)
|
$
|
142,007
|
$
|
137,557
|
|||||||||||||||||||||||
Tax equivalent adjustment
|
7,084
|
8,517
|
|||||||||||||||||||||||||
Tax-equivalent net interest
income
|
$
|
149,091
|
$
|
146,074
|
(1)
|
For purposes of this table, changes which are not due solely to volume changes or rate changes are allocated to such categories on the basis of the percentage relationship of each to the sum of the two.
|
(2)
|
Interest income and yields are presented on a tax-equivalent basis, assuming a federal income tax rate of 35%.
|
(3)
|
Covered interest-earning assets consist of loans acquired through FDIC-assisted transactions and the related FDIC indemnification asset. For additional discussion, please refer to the section titled “Covered Assets.”
|
Quarters Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2011
|
2010
|
% Change
|
2011
|
2010
|
% Change
|
|||||||||||
Service charges on deposit accounts
|
$
|
9,563
|
$
|
9,052
|
5.6
|
$
|
17,707
|
$
|
17,433
|
1.6
|
||||||
Trust and investment advisory fees
|
4,118
|
3,702
|
11.2
|
8,234
|
7,295
|
12.9
|
||||||||||
Other service charges, commissions, and
fees
|
5,362
|
4,628
|
15.9
|
10,276
|
8,800
|
16.8
|
||||||||||
Card-based fees (1)
|
5,162
|
4,497
|
14.8
|
9,691
|
8,390
|
15.5
|
||||||||||
Total fee-based revenues
|
24,205
|
21,879
|
10.6
|
45,908
|
41,918
|
9.5
|
||||||||||
Bank-owned life insurance (“BOLI”)
income (2)
|
259
|
349
|
( 25.8)
|
511
|
597
|
( 14.4)
|
||||||||||
Other income (3)
|
501
|
680
|
( 26.3)
|
1,479
|
1,196
|
23.7
|
||||||||||
Total operating revenues
|
24,965
|
22,908
|
9.0
|
47,898
|
43,711
|
9.6
|
||||||||||
Trading (losses) gains, net (4)
|
( 2)
|
(1,022)
|
( 99.8)
|
742
|
( 561)
|
( 232.3)
|
||||||||||
Gains on securities sales, net (5)
|
1,531
|
2,255
|
( 32.1)
|
2,071
|
8,075
|
( 74.4)
|
||||||||||
Securities impairment losses (5)
|
-
|
(1,134)
|
( 100.0)
|
-
|
(3,897)
|
( 100.0)
|
||||||||||
Gain on FDIC-assisted transaction (6)
|
-
|
4,303
|
( 100.0)
|
-
|
4,303
|
( 100.0)
|
||||||||||
Total noninterest income
|
$
|
26,494
|
$
|
27,310
|
( 3.0)
|
$
|
50,711
|
$
|
51,631
|
( 1.8)
|
(1)
|
Card-based fees consist of debit and credit card interchange fees charged for processing transactions as well as various fees charged on both customer and non-customer automated teller machine (“ATM”) and point-of-sale transactions processed through the ATM and point-of-sale networks.
|
(2)
|
BOLI income represents benefit payments received and the change in cash surrender value (“CSV”) of the policies, net of premiums paid. The change in CSV is attributed to earnings or losses credited to the policies based on investments made by the insurer. For a further discussion of our investment in BOLI, see Note 1 to the Consolidated Financial Statements of our 2010 10-K.
|
(3)
|
Other income consists of various items including safe deposit box rentals, miscellaneous recoveries, and gains on the sales of various assets.
|
(4)
|
Trading gains (losses), net result from the change in fair value of trading securities. Our trading securities represent diversified investment securities held in a grantor trust under deferred compensation arrangements in which plan participants may direct amounts earned to be invested in securities other than Company stock. These changes are substantially offset by an adjustment to salaries and wages expense.
|
(5)
|
For a discussion of these items, see the section titled “Investment Portfolio Management” elsewhere in this report.
|
(6)
|
The gain on FDIC-assisted transaction in the 2010 periods relates to a second quarter 2010 event in which we acquired the majority of the assets of a financial institution in an FDIC-assisted transaction.
|
Quarters Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||||||
2011
|
2010
|
% Change
|
2011
|
2010
|
% Change
|
|||||||||||
Compensation expense:
|
||||||||||||||||
Salaries and wages
|
$
|
25,493
|
$
|
21,146
|
20.6
|
$
|
51,158
|
$
|
43,282
|
18.2
|
||||||
Retirement and other employee
benefits
|
5,765
|
5,394
|
6.9
|
12,623
|
10,142
|
24.5
|
||||||||||
Total compensation expense
|
31,258
|
26,540
|
17.8
|
63,781
|
53,424
|
19.4
|
||||||||||
OREO expense, net:
|
||||||||||||||||
Write-downs of OREO
|
1,523
|
3,272
|
( 53.5)
|
2,635
|
5,610
|
( 53.0)
|
||||||||||
Losses on the sales of OREO, net (1)
|
1,900
|
5,652
|
( 66.4)
|
3,015
|
11,193
|
( 73.1)
|
||||||||||
OREO operating expense, net (2)
|
1,800
|
2,926
|
( 38.5)
|
3,504
|
5,834
|
( 39.9)
|
||||||||||
Total OREO expense
|
5,223
|
11,850
|
( 55.9)
|
9,154
|
22,637
|
( 59.6)
|
||||||||||
Professional services:
|
||||||||||||||||
Loan remediation costs
|
2,878
|
2,649
|
8.6
|
5,726
|
5,873
|
( 2.5)
|
||||||||||
Other professional services
|
2,762
|
3,003
|
( 8.0)
|
5,033
|
6,319
|
( 20.4)
|
||||||||||
Total professional services
|
5,640
|
5,652
|
( 0.2)
|
10,759
|
12,192
|
( 11.8)
|
||||||||||
FDIC insurance premiums
|
1,708
|
2,546
|
( 32.9)
|
4,433
|
5,078
|
( 12.7)
|
||||||||||
Net occupancy expense
|
5,681
|
5,657
|
0.4
|
12,465
|
11,697
|
6.6
|
||||||||||
Equipment expense
|
2,331
|
2,151
|
8.4
|
4,650
|
4,279
|
8.7
|
||||||||||
Technology and related costs
|
2,697
|
2,785
|
( 3.2)
|
5,320
|
5,268
|
1.0
|
||||||||||
Advertising and promotions
|
1,378
|
2,473
|
( 44.3)
|
2,457
|
3,532
|
( 30.4)
|
||||||||||
Merchant card expense
|
2,391
|
1,996
|
19.8
|
4,479
|
3,646
|
22.8
|
||||||||||
Other expenses
|
7,116
|
5,805
|
22.6
|
13,048
|
11,175
|
16.8
|
||||||||||
Total noninterest expense
|
$
|
65,423
|
$
|
67,455
|
( 3.0)
|
$
|
130,546
|
$
|
132,928
|
( 1.8)
|
||||||
Total noninterest expense, excluding
losses recognized on OREO
|
$
|
62,000
|
$
|
58,531
|
5.9
|
$
|
124,896
|
$
|
116,125
|
7.6
|
||||||
Full-time equivalent employees
|
1,846
|
1,762
|
4.8
|
1,846
|
1,746
|
5.7
|
||||||||||
Efficiency ratio (3)
|
60.19%
|
57.92%
|
61.29%
|
58.16%
|
(1)
|
For a discussion of sales of OREO properties, refer to the section titled “Non-performing assets.”
|
(2)
|
OREO operating expense, net, consists of real estate taxes, commissions on sales, insurance, and maintenance, net of any rental income.
|
(3)
|
The efficiency ratio expresses noninterest expense, excluding OREO expense, as a percentage of tax-equivalent net interest income plus total fees and other income.
|
June 30, 2011
|
December 31, 2010
|
|||||||||||||||||||||
Fair
Value
|
Amortized
Cost
|
Unrealized
Gains
(Losses)
|
% of Total Amortized Cost
|
Fair
Value
|
Amortized
Cost
|
Unrealized
Gains
(Losses)
|
% of Total Amortized Cost
|
|||||||||||||||
Available-for-Sale
|
||||||||||||||||||||||
U.S. agency securities
|
$
|
8,113
|
$
|
8,122
|
$
|
( 9)
|
0.8
|
$
|
17,886
|
$
|
18,000
|
$
|
( 114)
|
1.5
|
||||||||
Collateralized mortgage
obligations (“CMOs”)
|
376,702
|
373,600
|
3,102
|
34.0
|
379,589
|
377,692
|
1,897
|
32.3
|
||||||||||||||
Other mortgage-backed
securities
|
97,805
|
91,539
|
6,266
|
8.3
|
106,451
|
100,780
|
5,671
|
8.6
|
||||||||||||||
Municipal securities
|
479,919
|
471,617
|
8,302
|
43.0
|
503,991
|
512,063
|
(8,072)
|
43.7
|
||||||||||||||
Collateralized debt
obligations (“CDOs”)
|
16,487
|
49,695
|
(33,208)
|
4.5
|
14,858
|
49,695
|
(34,837)
|
4.2
|
||||||||||||||
Corporate debt securities
|
27,922
|
25,325
|
2,597
|
2.3
|
32,345
|
29,936
|
2,409
|
2.6
|
||||||||||||||
Equity securities
|
2,925
|
2,158
|
767
|
0.2
|
2,682
|
2,134
|
548
|
0.2
|
||||||||||||||
Total available-for-
sale
|
1,009,873
|
1,022,056
|
(12,183)
|
93.1
|
1,057,802
|
1,090,300
|
(32,498)
|
93.1
|
||||||||||||||
Held-to-Maturity
|
||||||||||||||||||||||
Municipal securities
|
78,485
|
76,142
|
2,343
|
6.9
|
82,525
|
81,320
|
1,205
|
6.9
|
||||||||||||||
Total securities
|
$
|
1,088,358
|
$
|
1,098,198
|
$
|
(9,840)
|
100.0
|
$
|
1,140,327
|
$
|
1,171,620
|
$
|
(31,293)
|
100.0
|
June 30, 2011
|
December 31, 2010
|
|||||||||||
Effective
Duration (1)
|
Average
Life (2)
|
Yield to
Maturity
|
Effective
Duration (1)
|
Average
Life (2)
|
Yield to
Maturity
|
|||||||
Available-for-Sale
|
||||||||||||
U.S. agency securities
|
2.34%
|
0.66
|
4.29%
|
1.91%
|
0.58
|
3.22%
|
||||||
CMOs
|
1.44%
|
2.40
|
2.27%
|
0.74%
|
2.52
|
2.31%
|
||||||
Other mortgage-backed securities
|
2.91%
|
4.43
|
4.88%
|
2.36%
|
3.85
|
4.62%
|
||||||
Municipal securities
|
5.14%
|
5.12
|
6.16%
|
5.35%
|
8.01
|
6.15%
|
||||||
CDOs
|
0.25%
|
8.67
|
0.00%
|
0.25%
|
8.78
|
0.00%
|
||||||
Other securities
|
6.51%
|
11.34
|
6.74%
|
6.58%
|
11.18
|
6.85%
|
||||||
Total available-for-sale
|
3.36%
|
4.35
|
4.33%
|
3.22%
|
5.72
|
4.37%
|
||||||
Held-to-Maturity
|
||||||||||||
Municipal securities
|
5.94%
|
10.64
|
6.56%
|
5.78%
|
9.99
|
6.61%
|
||||||
Total securities
|
3.54%
|
4.79
|
4.48%
|
3.40%
|
6.02
|
4.52%
|
(1)
|
The effective duration of the securities portfolio represents the estimated percentage change in the fair value of the securities portfolio given a 100 basis point change up or down in the level of interest rates. This measure is used as a gauge of the portfolio’s price volatility at a single point in time and is not intended to be a precise predictor of future fair values, as such values will be influenced by a number of factors.
|
(2)
|
Average life is presented in years and represents the weighted-average time to receive all future cash flows, using the dollar amount of principal paydowns, including estimated principal prepayments, as the weighting factor.
|
June 30,
2011
|
% of
Total
|
December 31,
2010
|
% of
Total
|
Annualized
% Change
|
||||||||
Commercial and industrial
|
$
|
1,518,772
|
29.7
|
$
|
1,465,903
|
28.7
|
7.2
|
|||||
Agricultural
|
237,518
|
4.6
|
227,756
|
4.5
|
8.6
|
|||||||
Commercial real estate:
|
||||||||||||
Office
|
415,654
|
8.1
|
396,836
|
7.8
|
9.5
|
|||||||
Retail
|
324,977
|
6.4
|
328,751
|
6.4
|
( 2.3)
|
|||||||
Industrial
|
488,469
|
9.6
|
478,026
|
9.4
|
4.4
|
|||||||
Multi-family
|
336,138
|
6.6
|
349,862
|
6.9
|
( 7.8)
|
|||||||
Residential construction
|
129,327
|
2.5
|
174,690
|
3.4
|
( 51.9)
|
|||||||
Commercial construction
|
146,679
|
2.9
|
164,472
|
3.2
|
( 21.6)
|
|||||||
Other commercial real estate
|
852,966
|
16.7
|
856,357
|
16.8
|
( 0.8)
|
|||||||
Total commercial real estate
|
2,694,210
|
52.8
|
2,748,994
|
53.9
|
( 4.0)
|
|||||||
Total corporate loans
|
4,450,500
|
87.1
|
4,442,653
|
87.1
|
0.4
|
|||||||
Home equity
|
429,923
|
8.4
|
445,243
|
8.7
|
( 6.9)
|
|||||||
1-4 family mortgages
|
185,002
|
3.6
|
160,890
|
3.2
|
30.0
|
|||||||
Installment loans
|
47,486
|
0.9
|
51,774
|
1.0
|
( 16.6)
|
|||||||
Total consumer loans
|
662,411
|
12.9
|
657,907
|
12.9
|
1.4
|
|||||||
Total loans, excluding covered loans
|
5,112,911
|
100.0
|
5,100,560
|
100.0
|
0.5
|
|||||||
Covered loans (1)
|
314,942
|
371,729
|
( 30.6)
|
|||||||||
Total loans
|
$
|
5,427,853
|
$
|
5,472,289
|
( 1.6)
|
(1)
|
For a detailed discussion of our covered loans and the related accounting policy for covered loans, refer to Notes 1 and 5 of “Notes to the Consolidated Financial Statements” in Item 1 of this Form 10-Q.
|
Past Due
|
||||||||||||||||||
Total
Loans
|
Performing
|
30-89 Days
Past Due
|
90 Days
Past Due
|
Non-accrual
|
Restructured
(still accruing
interest)
|
|||||||||||||
As of June 30, 2011
|
||||||||||||||||||
Commercial and industrial
|
$
|
1,518,772
|
$
|
1,457,838
|
$
|
6,806
|
$
|
2,095
|
$
|
44,393
|
$
|
7,640
|
||||||
Agricultural
|
237,518
|
236,492
|
17
|
-
|
1,009
|
-
|
||||||||||||
Commercial real estate:
|
||||||||||||||||||
Office
|
415,654
|
407,998
|
2,494
|
70
|
3,154
|
1,938
|
||||||||||||
Retail
|
324,977
|
314,978
|
583
|
-
|
7,887
|
1,529
|
||||||||||||
Industrial
|
488,469
|
480,785
|
1,925
|
233
|
5,526
|
-
|
||||||||||||
Multi-family
|
336,138
|
307,587
|
4,609
|
557
|
23,385
|
-
|
||||||||||||
Residential construction
|
129,327
|
102,357
|
3,394
|
-
|
23,576
|
-
|
||||||||||||
Commercial construction
|
146,679
|
125,230
|
-
|
-
|
21,449
|
-
|
||||||||||||
Other commercial real estate
|
852,966
|
813,884
|
1,406
|
464
|
36,984
|
228
|
||||||||||||
Total commercial real estate
|
2,694,210
|
2,552,819
|
14,411
|
1,324
|
121,961
|
3,695
|
||||||||||||
Total corporate loans
|
4,450,500
|
4,247,149
|
21,234
|
3,419
|
167,363
|
11,335
|
||||||||||||
Home equity
|
429,923
|
414,344
|
6,671
|
2,392
|
5,519
|
997
|
||||||||||||
1-4 family mortgages
|
185,002
|
175,743
|
1,984
|
656
|
4,577
|
2,042
|
||||||||||||
Installment loans
|
47,486
|
46,725
|
535
|
35
|
36
|
155
|
||||||||||||
Total consumer loans
|
662,411
|
636,812
|
9,190
|
3,083
|
10,132
|
3,194
|
||||||||||||
Total loans, excluding covered
loans
|
5,112,911
|
4,883,961
|
30,424
|
6,502
|
177,495
|
14,529
|
||||||||||||
Covered loans
|
314,942
|
216,850
|
26,180
|
68,324
|
3,588
|
-
|
||||||||||||
Total loans
|
$
|
5,427,853
|
$
|
5,100,811
|
$
|
56,604
|
$
|
74,826
|
$
|
181,083
|
$
|
14,529
|
||||||
As of December 31, 2010
|
||||||||||||||||||
Commercial and industrial
|
$
|
1,465,903
|
$
|
1,403,409
|
$
|
5,398
|
$
|
1,552
|
$
|
50,088
|
$
|
5,456
|
||||||
Agricultural
|
227,756
|
223,021
|
65
|
187
|
2,497
|
1,986
|
||||||||||||
Commercial real estate:
|
||||||||||||||||||
Office
|
396,836
|
389,936
|
1,671
|
-
|
5,087
|
142
|
||||||||||||
Retail
|
328,751
|
320,477
|
447
|
-
|
7,827
|
-
|
||||||||||||
Industrial
|
478,026
|
468,995
|
461
|
-
|
6,659
|
1,911
|
||||||||||||
Multi-family
|
349,862
|
343,070
|
486
|
-
|
6,203
|
103
|
||||||||||||
Residential construction
|
174,690
|
122,317
|
51
|
200
|
52,122
|
-
|
||||||||||||
Commercial construction
|
164,472
|
135,787
|
-
|
-
|
28,685
|
-
|
||||||||||||
Other commercial real estate
|
856,357
|
802,461
|
8,115
|
345
|
40,605
|
4,831
|
||||||||||||
Total commercial real estate
|
2,748,994
|
2,583,043
|
11,231
|
545
|
147,188
|
6,987
|
||||||||||||
Total corporate loans
|
4,442,653
|
4,209,473
|
16,694
|
2,284
|
199,773
|
14,429
|
||||||||||||
Home equity
|
445,243
|
428,726
|
4,055
|
1,870
|
7,948
|
2,644
|
||||||||||||
1-4 family mortgages
|
160,890
|
149,419
|
2,267
|
4
|
3,902
|
5,298
|
||||||||||||
Installment loans
|
51,774
|
50,899
|
630
|
86
|
159
|
-
|
||||||||||||
Total consumer loans
|
657,907
|
629,044
|
6,952
|
1,960
|
12,009
|
7,942
|
||||||||||||
Total loans, excluding covered
loans
|
5,100,560
|
4,838,517
|
23,646
|
4,244
|
211,782
|
22,371
|
||||||||||||
Covered loans
|
371,729
|
268,934
|
18,445
|
84,350
|
-
|
-
|
||||||||||||
Total loans
|
$
|
5,472,289
|
$
|
5,107,451
|
$
|
42,091
|
$
|
88,594
|
$
|
211,782
|
$
|
22,371
|
2011
|
2010
|
||||||||||||||
June 30
|
March 31
|
December 31
|
September 30
|
June 30
|
|||||||||||
Non-performing assets, excluding covered loans and covered OREO
|
|||||||||||||||
Non-accrual loans
|
$
|
177,495
|
$
|
186,563
|
$
|
211,782
|
$
|
211,366
|
$
|
193,689
|
|||||
90 days or more past due loans
|
6,502
|
5,231
|
4,244
|
9,136
|
6,280
|
||||||||||
Total non-performing loans
|
183,997
|
191,794
|
216,026
|
220,502
|
199,969
|
||||||||||
Restructured loans (still accruing interest)
|
14,529
|
14,120
|
22,371
|
11,002
|
9,030
|
||||||||||
Other real estate owned
|
24,407
|
33,863
|
31,069
|
52,044
|
57,023
|
||||||||||
Total non-performing assets
|
$
|
222,933
|
$
|
239,777
|
$
|
269,466
|
$
|
283,548
|
$
|
266,022
|
|||||
30-89 days past due loans
|
$
|
30,424
|
$
|
28,927
|
$
|
23,646
|
$
|
41,590
|
$
|
32,012
|
|||||
Non-accrual loans to total loans
|
3.47%
|
3.66%
|
4.15%
|
4.09%
|
3.72%
|
||||||||||
Non-performing loans to total loans
|
3.60%
|
3.76%
|
4.24%
|
4.27%
|
3.84%
|
||||||||||
Non-performing assets to loans plus OREO
|
4.34%
|
4.67%
|
5.25%
|
5.44%
|
5.05%
|
||||||||||
Covered loans and covered OREO (1)
|
|||||||||||||||
Non-accrual loans
|
$
|
3,588
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||
90 days or more past due loans
|
68,324
|
88,605
|
84,350
|
74,777
|
47,912
|
||||||||||
Total non-performing loans
|
71,912
|
88,605
|
84,350
|
74,777
|
47,912
|
||||||||||
Restructured loans (still accruing interest)
|
-
|
-
|
-
|
-
|
-
|
||||||||||
Other real estate owned
|
14,583
|
21,543
|
22,370
|
31,550
|
10,657
|
||||||||||
Total non-performing assets
|
$
|
86,495
|
$
|
110,148
|
$
|
106,720
|
$
|
106,327
|
$
|
58,569
|
|||||
30-89 days past due loans
|
$
|
26,180
|
$
|
10,399
|
$
|
18,445
|
$
|
24,005
|
$
|
13,725
|
|||||
Non-performing assets, including covered loans and covered OREO
|
|||||||||||||||
Non-accrual loans
|
$
|
181,083
|
$
|
186,563
|
$
|
211,782
|
$
|
211,366
|
$
|
193,689
|
|||||
90 days or more past due loans
|
74,826
|
93,836
|
88,594
|
83,913
|
54,192
|
||||||||||
Total non-performing loans
|
255,909
|
280,399
|
300,376
|
295,279
|
247,881
|
||||||||||
Restructured loans (still accruing interest)
|
14,529
|
14,120
|
22,371
|
11,002
|
9,030
|
||||||||||
Other real estate owned
|
38,990
|
55,406
|
53,439
|
83,594
|
67,680
|
||||||||||
Total non-performing assets
|
$
|
309,428
|
$
|
349,925
|
$
|
376,186
|
$
|
389,875
|
$
|
324,591
|
|||||
30-89 days past due loans
|
$
|
56,604
|
$
|
39,326
|
$
|
42,091
|
$
|
65,595
|
$
|
45,737
|
|||||
Non-accrual loans to total loans
|
3.34%
|
3.42%
|
3.87%
|
3.80%
|
3.60%
|
||||||||||
Non-performing loans to total loans
|
4.71%
|
5.15%
|
5.49%
|
5.31%
|
4.61%
|
||||||||||
Non-performing assets to loans plus OREO
|
5.66%
|
6.36%
|
6.81%
|
6.90%
|
5.97%
|
(1)
|
For a discussion of covered loans and covered OREO, refer to Note 5 of “Notes to Consolidated Financial Statements” in Item 1 of this Form 10-Q.
|
Residential
Construction
|
Commercial
Construction
|
Combined
|
Non-
performing Loans
|
|||||||||||||||
Underlying Collateral
|
Amount
|
Percent
of Total
|
Amount
|
Percent
of Total
|
Amount
|
Percent
of Total
|
||||||||||||
As of June 30, 2011
|
||||||||||||||||||
Raw Land
|
$
|
28,133
|
21.7
|
$
|
44,083
|
30.1
|
$
|
72,216
|
26.2
|
$
|
26,381
|
|||||||
Developed Land
|
66,211
|
51.2
|
56,490
|
38.5
|
122,701
|
44.4
|
10,826
|
|||||||||||
Construction
|
14,575
|
11.3
|
17,108
|
11.7
|
31,683
|
11.5
|
2,173
|
|||||||||||
Substantially completed
structures
|
16,946
|
13.1
|
25,262
|
17.2
|
42,208
|
15.3
|
3,807
|
|||||||||||
Mixed and other
|
3,462
|
2.7
|
3,736
|
2.5
|
7,198
|
2.6
|
1,838
|
|||||||||||
Total
|
$
|
129,327
|
100.0
|
$
|
146,679
|
100.0
|
$
|
276,006
|
100.0
|
$
|
45,025
|
|||||||
Weighted-average maturity
(in years)
|
0.43
|
0.73
|
0.59
|
|||||||||||||||
Non-accrual loans
|
$
|
23,576
|
$
|
21,449
|
$
|
45,025
|
||||||||||||
90-days past due loans
|
-
|
-
|
-
|
|||||||||||||||
Total non-performing loans
|
$
|
23,576
|
$
|
21,449
|
$
|
45,025
|
||||||||||||
Non-performing loans as
a percent of total loans
|
18.2%
|
14.6%
|
16.3%
|
|||||||||||||||
As of December 31, 2010
|
||||||||||||||||||
Raw land
|
$
|
35,401
|
20.3
|
$
|
46,995
|
28.6
|
$
|
82,396
|
24.3
|
$
|
38,605
|
|||||||
Developed land
|
83,229
|
47.6
|
71,856
|
43.7
|
155,085
|
45.7
|
23,320
|
|||||||||||
Construction
|
14,077
|
8.1
|
22,882
|
13.9
|
36,959
|
10.9
|
1,570
|
|||||||||||
Substantially completed
structures
|
32,538
|
18.6
|
22,284
|
13.5
|
54,822
|
16.2
|
10,576
|
|||||||||||
Mixed and other
|
9,445
|
5.4
|
455
|
0.3
|
9,900
|
2.9
|
6,936
|
|||||||||||
Total
|
$
|
174,690
|
100.0
|
$
|
164,472
|
100.0
|
$
|
339,162
|
100.0
|
$
|
81,007
|
|||||||
Weighted-average
maturity (in years)
|
0.49
|
0.68
|
0.58
|
|||||||||||||||
Non-accrual loans
|
$
|
52,122
|
$
|
28,685
|
$
|
80,807
|
||||||||||||
90-days past due loans
|
200
|
-
|
200
|
|||||||||||||||
Total non-performing
loans
|
$
|
52,322
|
$
|
28,685
|
$
|
81,007
|
||||||||||||
Non-performing loans as
a percent of total loans
|
30.0%
|
17.4%
|
23.9%
|
June 30, 2011
|
March 31, 2011
|
December 31, 2010
|
June 30, 2010
|
|||||||||||||||||
Number
of Loans
|
Amount
|
Number
of Loans
|
Amount
|
Number
of Loans
|
Amount
|
Number
of Loans
|
Amount
|
|||||||||||||
Commercial and industrial
|
25
|
$
|
18,887
|
28
|
$
|
22,569
|
46
|
$
|
23,404
|
33
|
$
|
18,682
|
||||||||
Agricultural
|
-
|
-
|
-
|
-
|
1
|
1,986
|
-
|
-
|
||||||||||||
Commercial real estate:
|
||||||||||||||||||||
Office
|
1
|
1,938
|
-
|
-
|
1
|
142
|
1
|
142
|
||||||||||||
Retail
|
1
|
1,529
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||
Industrial
|
-
|
-
|
1
|
1,828
|
2
|
1,911
|
-
|
-
|
||||||||||||
Multi-family
|
8
|
2,582
|
8
|
3,078
|
9
|
3,193
|
9
|
4,860
|
||||||||||||
Residential construction
|
3
|
3,115
|
4
|
4,539
|
4
|
8,323
|
1
|
1,423
|
||||||||||||
Other commercial real estate
|
7
|
2,633
|
7
|
6,588
|
13
|
7,229
|
8
|
3,001
|
||||||||||||
Total commercial real estate
loans
|
20
|
11,797
|
20
|
16,033
|
29
|
20,798
|
19
|
9,426
|
||||||||||||
Home equity loans
|
24
|
1,701
|
22
|
1,641
|
50
|
3,233
|
39
|
2,260
|
||||||||||||
1-4 family mortgages
|
28
|
3,420
|
23
|
2,944
|
49
|
6,703
|
37
|
5,330
|
||||||||||||
Total consumer loans
|
52
|
5,121
|
45
|
4,585
|
99
|
9,936
|
76
|
7,590
|
||||||||||||
Total restructured loans
|
97
|
$
|
35,805
|
93
|
$
|
43,187
|
175
|
$
|
56,124
|
128
|
$
|
35,698
|
||||||||
Restructured loans, still
accruing interest
|
56
|
$
|
14,529
|
53
|
$
|
14,120
|
120
|
$
|
22,371
|
81
|
$
|
9,030
|
||||||||
Restructured loans included in
non-accrual
|
41
|
21,276
|
40
|
29,067
|
55
|
33,753
|
47
|
26,668
|
||||||||||||
Total restructured loans
|
97
|
$
|
35,805
|
93
|
$
|
43,187
|
175
|
$
|
56,124
|
128
|
$
|
35,698
|
||||||||
Year-to-date charge-offs on
restructured loans
|
$
|
1,809
|
$
|
63
|
$
|
11,534
|
$
|
793
|
||||||||||||
Valuation allowance related to
restructured loans
|
$
|
-
|
$
|
519
|
$
|
-
|
$
|
-
|
June 30, 2011
|
December 31, 2010
|
June 30, 2010
|
|||||||||||||
Number of
Properties
|
Amount
|
Number of Properties
|
Amount
|
Number of Properties
|
Amount
|
||||||||||
Single family homes
|
7
|
$
|
813
|
6
|
$
|
1,113
|
17
|
$
|
3,191
|
||||||
Land parcels:
|
|||||||||||||||
Raw land
|
5
|
7,364
|
5
|
7,467
|
5
|
11,511
|
|||||||||
Farmland
|
1
|
208
|
2
|
4,657
|
2
|
9,087
|
|||||||||
Commercial lots
|
17
|
7,558
|
14
|
4,096
|
15
|
4,885
|
|||||||||
Single-family lots
|
18
|
3,780
|
27
|
7,564
|
53
|
19,609
|
|||||||||
Total land parcels
|
41
|
18,910
|
48
|
23,784
|
75
|
45,092
|
|||||||||
Multi-family units
|
4
|
666
|
4
|
714
|
2
|
444
|
|||||||||
Commercial properties
|
14
|
4,018
|
12
|
5,458
|
11
|
8,296
|
|||||||||
Total OREO properties
|
66
|
$
|
24,407
|
70
|
$
|
31,069
|
105
|
$
|
57,023
|
||||||
Covered OREO
|
38
|
$
|
14,583
|
44
|
$
|
22,370
|
18
|
$
|
10,657
|
Six Months Ended June 30, 2011
|
|||||||||
Proceeds
|
Book Value
|
Charge-offs
|
|||||||
Loans sold or identified as held-for-sale
|
|||||||||
Office retail, and, industrial
|
$
|
551
|
$
|
997
|
$
|
( 446)
|
|||
Residential construction
|
3,691
|
6,269
|
(2,578)
|
||||||
Commercial construction
|
3,800
|
4,000
|
( 200)
|
||||||
Total loans sold
|
8,042
|
11,266
|
(3,224)
|
||||||
Residential construction loan classified as held-for-sale
|
1,595
|
1,595
|
-
|
||||||
Partial sales and paydowns
|
28,643
|
28,643
|
-
|
||||||
Total loans sold, paid off or transferred to held-for-sale
|
$
|
38,280
|
41,504
|
(3,224)
|
Six Months Ended June 30, 2011
|
|||||||||
OREO
|
Covered OREO
|
Total
|
|||||||
OREO sales
|
|||||||||
Proceeds from sales
|
$
|
17,580
|
$
|
3,855
|
$
|
21,435
|
|||
Less: Basis of properties sold
|
20,402
|
4,048
|
24,450
|
||||||
Losses on sales of OREO, net
|
$
|
(2,822)
|
$
|
( 193)
|
$
|
(3,015)
|
|||
OREO transfers and write-downs
|
|||||||||
OREO transferred to premises, furniture, and equipment (at fair value)
|
$
|
841
|
$
|
-
|
$
|
841
|
|||
OREO write-downs
|
$
|
1,693
|
$
|
942
|
$
|
2,635
|
Quarters Ended
|
||||||||||||||||
2011
|
2010
|
|||||||||||||||
June 30
|
March 31
|
December 31
|
September 30
|
June 30
|
||||||||||||
Change in allowance for credit
losses:
|
||||||||||||||||
Balance at beginning of quarter
|
$
|
145,003
|
$
|
145,072
|
$
|
145,019
|
$
|
145,477
|
$
|
144,824
|
||||||
Loans charged-off:
|
||||||||||||||||
Commercial and industrial
|
(6,003)
|
(4,965)
|
(10,629)
|
(13,968)
|
(5,896)
|
|||||||||||
Agricultural
|
(900)
|
(9)
|
(125)
|
(489)
|
(546)
|
|||||||||||
Office, retail, and industrial
|
(647)
|
(1,199)
|
(2,888)
|
(3,205)
|
(2,377)
|
|||||||||||
Multi-family
|
(6,652)
|
(549)
|
(1,017)
|
(412)
|
(732)
|
|||||||||||
Residential construction
|
(3,661)
|
(5,422)
|
(36,435)
|
(4,571)
|
(10,048)
|
|||||||||||
Commercial construction
|
(185)
|
(261)
|
(7,743)
|
(228)
|
(115)
|
|||||||||||
Other commercial real estate
|
(2,484)
|
(5,401)
|
(12,354)
|
(10,417)
|
(1,560)
|
|||||||||||
Consumer
|
(2,767)
|
(2,424)
|
(2,416)
|
(2,139)
|
(2,546)
|
|||||||||||
1-4 family mortgages
|
(341)
|
(247)
|
(238)
|
(364)
|
(261)
|
|||||||||||
Total loans charged-off
|
(23,640)
|
(20,477)
|
(73,845)
|
(35,793)
|
(24,081)
|
|||||||||||
Recoveries on loans previously
charged-off:
|
||||||||||||||||
Commercial and industrial
|
418
|
1,837
|
431
|
706
|
3,217
|
|||||||||||
Agricultural
|
101
|
-
|
-
|
-
|
-
|
|||||||||||
Office, retail, and industrial
|
38
|
16
|
-
|
380
|
24
|
|||||||||||
Multi-family
|
-
|
-
|
(189)
|
190
|
247
|
|||||||||||
Residential construction
|
2,762
|
4
|
500
|
111
|
54
|
|||||||||||
Commercial construction
|
52
|
-
|
-
|
-
|
-
|
|||||||||||
Other commercial real estate
|
377
|
43
|
152
|
200
|
53
|
|||||||||||
Consumer
|
64
|
107
|
42
|
160
|
264
|
|||||||||||
1-4 family mortgages
|
1
|
1
|
-
|
1
|
-
|
|||||||||||
Total recoveries on loans
previously charged-off
|
3,813
|
2,008
|
936
|
1,748
|
3,859
|
|||||||||||
Net loans charged-off, excluding
covered loans
|
(19,827)
|
(18,469)
|
(72,909)
|
(34,045)
|
(20,222)
|
|||||||||||
Net (charge-offs) recoveries on
covered loans
|
(4,108)
|
(1,092)
|
(935)
|
11
|
(651)
|
|||||||||||
Net loans charged off
|
(23,935)
|
(19,561)
|
(73,844)
|
(34,034)
|
(20,873)
|
|||||||||||
Provision charged to operating
expense:
|
||||||||||||||||
Provision, excluding provision for
covered loans
|
14,655
|
18,400
|
72,962
|
33,587
|
20,875
|
|||||||||||
Provision for covered loans
|
22,356
|
7,501
|
14,410
|
(424)
|
13,023
|
|||||||||||
Less: expected reimbursement
from the FDIC
|
(18,248)
|
(6,409)
|
(13,475)
|
413
|
(12,372)
|
|||||||||||
Net provision for covered loans
|
4,108
|
1,092
|
935
|
( 11)
|
651
|
|||||||||||
Total provision charged to operating
expense
|
18,763
|
19,492
|
73,897
|
33,576
|
21,526
|
|||||||||||
Balance at end of quarter
|
$
|
139,831
|
$
|
145,003
|
$
|
145,072
|
$
|
145,019
|
$
|
145,477
|
||||||
Allowance for loan losses
|
137,331
|
$
|
142,503
|
$
|
142,572
|
$
|
144,569
|
$
|
145,027
|
|||||||
Reserve for unfunded commitments
|
2,500
|
2,500
|
2,500
|
450
|
450
|
|||||||||||
Total allowance for credit losses
|
$
|
139,831
|
$
|
145,003
|
$
|
145,072
|
$
|
145,019
|
$
|
145,477
|
Quarters Ended
|
||||||||||||||||
2011
|
2010
|
|||||||||||||||
June 30
|
March 31
|
December 31
|
September 30
|
June 30
|
||||||||||||
Average loans, excluding covered
loans
|
$
|
5,108,234
|
$
|
5,075,840
|
$
|
5,155,416
|
$
|
5,207,419
|
$
|
5,204,566
|
||||||
Net loans charged-off to average
loans, excluding covered loans,
annualized
|
1.56%
|
1.48%
|
5.61%
|
2.59%
|
1.56%
|
|||||||||||
Allowance for credit losses at end of
period as a percent of:
|
||||||||||||||||
Total loans, excluding covered loans
|
2.73%
|
2.85%
|
2.84%
|
2.81%
|
2.79%
|
|||||||||||
Non-performing loans, excluding
covered loans
|
76%
|
76%
|
67%
|
66%
|
73%
|
|||||||||||
Average loans, including covered
loans
|
$
|
5,443,761
|
$
|
5,438,978
|
$
|
5,545,953
|
$
|
5,494,712
|
$
|
5,376,861
|
||||||
Net loans charged-off to average
loans, annualized
|
1.76%
|
1.46%
|
5.28%
|
2.46%
|
1.56%
|
|||||||||||
Allowance for credit losses at end of
period as a percent of:
|
||||||||||||||||
Total loans
|
2.58%
|
2.66%
|
2.65%
|
2.61%
|
2.71%
|
|||||||||||
Non-performing loans
|
55%
|
51%
|
48%
|
49%
|
59%
|
Quarters Ended
|
Second Quarter 2011
% Change From
|
|||||||||||||
June 30,
2011
|
December 31,
2010
|
June 30,
2010
|
Fourth
Quarter
2010
|
Second
Quarter
2010
|
||||||||||
Demand deposits
|
$
|
1,465,438
|
$
|
1,348,188
|
$
|
1,181,097
|
8.7
|
24.1
|
||||||
Savings deposits
|
944,802
|
864,334
|
803,353
|
9.3
|
17.6
|
|||||||||
NOW accounts
|
1,126,913
|
1,075,642
|
1,157,246
|
4.8
|
( 2.6)
|
|||||||||
Money market accounts
|
1,205,736
|
1,302,325
|
1,155,889
|
( 7.4)
|
4.3
|
|||||||||
Transactional deposits
|
4,742,889
|
4,590,489
|
4,297,585
|
3.3
|
10.4
|
|||||||||
Time deposits
|
1,799,218
|
2,045,330
|
1,898,453
|
( 12.0)
|
( 5.2)
|
|||||||||
Brokered deposits
|
13,946
|
24,059
|
17,663
|
( 42.0)
|
( 21.0)
|
|||||||||
Total time deposits
|
1,813,164
|
2,069,389
|
1,916,116
|
( 12.4)
|
( 5.4)
|
|||||||||
Total deposits
|
6,556,053
|
6,659,878
|
6,213,701
|
( 1.6)
|
5.5
|
|||||||||
Repurchase agreements
|
122,607
|
143,549
|
201,078
|
( 14.6)
|
( 39.0)
|
|||||||||
Federal funds purchased
|
2,418
|
1
|
221
|
N/M
|
N/M
|
|||||||||
Federal Home Loan Bank (“FHLB”) advances
|
137,500
|
137,500
|
141,509
|
0.0
|
( 2.8)
|
|||||||||
Total borrowed funds
|
262,525
|
281,050
|
342,808
|
( 6.6)
|
( 23.4)
|
|||||||||
Subordinated debt
|
137,747
|
137,743
|
137,738
|
0.0
|
0.0
|
|||||||||
Total funding sources
|
$
|
6,956,325
|
$
|
7,078,671
|
$
|
6,694,247
|
( 1.7)
|
3.9
|
||||||
Average interest rate paid on borrowed funds
|
1.05%
|
1.00%
|
0.88%
|
|||||||||||
Weighted-average maturity of FHLB
advances
|
21.6 months
|
27.6 months
|
33.6 months
|
|||||||||||
Weighted-average interest rate of FHLB
advances
|
1.95%
|
1.95%
|
1.95%
|
June 30, 2011
|
June 30, 2010
|
||||||||||
Amount
|
Rate (%)
|
Amount
|
Rate (%)
|
||||||||
At period-end:
|
|||||||||||
Securities sold under agreements to repurchase
|
$
|
134,524
|
0.02
|
$
|
191,036
|
0.07
|
|||||
FHLB advances
|
137,500
|
1.95
|
137,434
|
1.95
|
|||||||
Total borrowed funds
|
$
|
272,024
|
0.99
|
$
|
328,470
|
0.86
|
|||||
Average for the year-to-date period:
|
|||||||||||
Securities sold under agreements to repurchase
|
$
|
135,407
|
0.02
|
$
|
212,320
|
0.21
|
|||||
Federal funds purchased
|
1,215
|
0.17
|
8,813
|
0.14
|
|||||||
FHLB advances
|
137,500
|
1.98
|
147,677
|
2.03
|
|||||||
Federal term auction facilities
|
-
|
-
|
40,884
|
0.25
|
|||||||
Total borrowed funds
|
$
|
274,122
|
1.01
|
$
|
409,694
|
0.87
|
|||||
Maximum amount outstanding at the end of any day
during the period:
|
|||||||||||
Securities sold under agreements to repurchase
|
$
|
174,810
|
$
|
256,238
|
|||||||
Federal funds purchased
|
175,000
|
60,000
|
|||||||||
FHLB advances
|
137,500
|
272,802
|
|||||||||
Federal term auction facilities
|
1
|
300,000
|
June 30,
2011
|
December 31,
2010
|
June 30,
2010
|
Regulatory
Minimum
For
“Well-
Capitalized”
|
Excess Over
Required Minimums
at June 30, 2011
|
|||||||||
Regulatory capital ratios:
|
|||||||||||||
Total capital to risk-weighted assets
|
16.70%
|
16.27%
|
17.31%
|
10.00%
|
67%
|
$
|
419,579
|
||||||
Tier 1 capital to risk-weighted assets
|
14.63%
|
14.20%
|
15.25%
|
6.00%
|
144%
|
$
|
540,461
|
||||||
Tier 1 leverage to average assets
|
11.65%
|
11.21%
|
12.69%
|
5.00%
|
133%
|
$
|
523,055
|
||||||
Regulatory capital ratios, excluding
preferred stock (1):
|
|||||||||||||
Total capital to risk-weighted assets
|
13.62%
|
13.21%
|
14.27%
|
10.00%
|
36%
|
$
|
226,579
|
||||||
Tier 1 capital to risk-weighted assets
|
11.55%
|
11.15%
|
12.21%
|
6.00%
|
92%
|
$
|
347,461
|
||||||
Tier 1 leverage to average assets
|
9.20%
|
8.80%
|
10.17%
|
5.00%
|
84%
|
$
|
330,055
|
||||||
Tier 1 common capital to risk-
weighted assets (2) (3)
|
10.20%
|
9.81%
|
10.88%
|
N/A (3)
|
N/A (3)
|
N/A (3)
|
|||||||
Tangible common equity ratios:
|
|||||||||||||
Tangible common equity to tangible
assets
|
8.47%
|
8.06%
|
9.05%
|
N/A (3)
|
N/A (3)
|
N/A (3)
|
|||||||
Tangible common equity, excluding
other comprehensive loss, to tangible
assets
|
8.67%
|
8.41%
|
9.22%
|
N/A (3)
|
N/A (3)
|
N/A (3)
|
|||||||
Tangible common equity to risk-
weighted assets
|
10.61%
|
10.02%
|
10.71%
|
N/A (3)
|
N/A (3)
|
N/A (3)
|
|||||||
Regulatory capital ratios, Bank only (4):
|
|||||||||||||
Total capital to risk-weighted assets
|
14.62%
|
13.87%
|
14.02%
|
10.00%
|
46%
|
$
|
283,305
|
||||||
Tier 1 capital to risk-weighted assets
|
13.36%
|
12.61%
|
12.76%
|
6.00%
|
123%
|
$
|
450,934
|
||||||
Tier 1 leverage to average assets
|
10.54%
|
9.88%
|
10.59%
|
5.00%
|
111%
|
$
|
430,340
|
(1)
|
These ratios exclude the impact of $193.0 million in preferred shares issued to the Treasury in December 2008 as part of its Capital Purchase Program (“CPP”). For additional discussion of the preferred share issuance and the CPP, refer to Note 12 to the Consolidated Financial Statements of our 2010 Form 10-K.
|
(2)
|
Excludes the impact of preferred shares and trust-preferred securities.
|
(3)
|
Ratio is not subject to formal Federal Reserve regulatory guidance.
|
(4)
|
Ratio presented pertains to our wholly owned banking subsidiary, First Midwest Bank.
|
Gradual Change in Rates (1)
|
Immediate Change in Rates
|
||||||||||||||||
-200
|
+200
|
-200
|
+200
|
-300 (2)
|
+300
|
||||||||||||
June 30, 2011:
|
|||||||||||||||||
Dollar change
|
$
|
(10,508)
|
$
|
11,304
|
$
|
(10,431)
|
$
|
15,837
|
$
|
N/M
|
$
|
25,141
|
|||||
Percent change
|
-3.7%
|
+3.9%
|
-3.6%
|
+5.5%
|
N/M
|
+8.7%
|
|||||||||||
December 31, 2010:
|
|||||||||||||||||
Dollar change
|
$
|
(13,609)
|
$
|
7,393
|
$
|
(18,736)
|
$
|
10,072
|
$
|
N/M
|
$
|
21,148
|
|||||
Percent change
|
-4.7%
|
+2.5%
|
-6.4%
|
+3.4%
|
N/M
|
+7.2%
|
(1)
|
The gradual change in rates reflects an assumed uniform change in interest rates across all terms that occurs in equal steps over a six-month horizon.
|
(2)
|
N/M – Due to the low level of interest rates as of June 30, 2011 and December 31, 2010, in management’s judgment, an assumed 300 basis point drop in interest rates was deemed not meaningful in the existing interest rate environment.
|
Immediate Change in Rates
|
||||||
-200
|
+200
|
|||||
June 30, 2011:
|
||||||
Dollar change
|
$
|
(72,277)
|
$
|
99,897
|
||
Percent change
|
-4.4%
|
+6.1%
|
||||
December 31, 2010:
|
||||||
Dollar change
|
$
|
(148,859)
|
$
|
61,708
|
||
Percent change
|
-9.2%
|
+3.8%
|
Total
Number of
Shares
Purchased (1)
|
Average
Price
Paid per
Share
|
Total Number of Shares Purchased as Part of a Publicly Announced Plan or Program
|
Maximum
Number of
Shares that
May Yet Be
Purchased
Under the
Plan or
Program
|
||||||
April 1 – April 30, 2011
|
-
|
$
|
-
|
-
|
2,494,747
|
||||
May 1 – May 31, 2011
|
76,362
|
12.24
|
-
|
2,494,747
|
|||||
June 1 – June 30, 2011
|
-
|
-
|
-
|
2,494,747
|
|||||
Total
|
76,362
|
$
|
12.24
|
-
|
(1)
|
Consists of shares acquired pursuant to the Company’s share-based compensation plans and not the Company’s repurchase program approved by its Board of Directors on November 27, 2007. Under the terms of these plans, the Company accepts shares of common stock from option holders if they elect to surrender previously owned shares upon exercise to cover the exercise price of the stock options or, in the case of restricted shares of common stock, the withholding of shares to satisfy tax withholding obligations associated with the vesting of restricted shares.
|
Exhibit
Number
|
Description of Documents
|
Sequential
Page #
|
3.1
|
Restated Certificate of Incorporation of First Midwest Bancorp, Inc. is herein incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2009.
|
|
3.2
|
Restated By-laws of First Midwest Bancorp, Inc. is herein incorporated by reference to Exhibit 3.2 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2009.
|
|
10.1
|
Employment Agreement between the Company and its Chief Operating Officer.
|
|
10.2
|
Grant of Nonqualified Stock Option between the Company and its Chief Operating Officer.
|
|
10.3
|
Grant of Restricted Stock Letter Agreement between the Company and its Chief Operating Officer.
|
|
10.4
|
Supplemental Salary Stock Compensation Award Agreement between the Company and its Chief Operating Officer.
|
|
10.5
|
Compensation Award Agreement between the Company and its Chief Operating Officer.
|
|
11
|
Statement re: Computation of Per Share Earnings - The computation of basic and diluted earnings per common share is included in Note 7 of the Company’s Notes to Consolidated Financial Statements included in “ITEM 1. FINANCIAL STATEMENTS” of this document.
|
|
15
|
Acknowledgment of Independent Registered Public Accounting Firm.
|
|
31.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32.1 (1)
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2 (1)
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
99
|
Report of Independent Registered Public Accounting Firm.
|
|
101 (1)
|
Interactive Data File.
|
(1)
|
Furnished, not filed.
|
First Midwest Bancorp, Inc.
|
/s/ PAUL F. CLEMENS
|
Paul F. Clemens
Executive Vice President, Chief Financial Officer,
and Principal Accounting Officer*
|
ATTEST: /s/ CYNTHIA A. LANCE
|
First Midwest Bancorp, Inc.
|
Cynthia A. Lance | /s/ MICHAEL L. SCUDDER |
Corporate Secretary |
By: Michael L. Scudder
|
Title: President and Chief Executive Officer
|
|
EXECUTIVE: /s/ MARK G. SANDER
|
|
|
RE:
|
Letter Agreement dated June [ ], 2011, Option Number [______]
|
|
Grant of Nonqualified Stock Option (the “Letter Agreement” or "Agreement")
|
1.
|
Exercisability
|
2.
|
Procedure for Exercise
|
(a)
|
delivery of written notification of exercise and payment in full:
|
(i)
|
in cash or its equivalent (including a broker-assisted cashless exercise as described in the Plan); or
|
(ii)
|
by tendering Previously-Acquired Shares of Company Stock having a fair market value at the exercise date (defined as the average of the high and low prices of the Company's Common Stock as reported by the consolidated tape of the Nasdaq National Market System on the date the written notice of exercise is received by the office of the Corporate Controller) equal to all or part of the total Option price (including for this purpose shares deemed tendered by affirmation of ownership); or
|
(iii)
|
by combination of (i) and (ii);
|
(b)
|
for all Option shares being purchased, plus the amount of federal and state income tax and FICA/Medicare tax required to be withheld by reason of the exercise of the Option, unless you have properly elected to deliver Previously-Acquired Shares or have Option shares withheld to satisfy such taxes; and
|
(c)
|
if requested within the specified time set forth in any such request, delivery to the Company of such written representations and undertakings as may, in the opinion of the Company's counsel, be necessary or desirable to comply with federal and state securities laws.
|
3.
|
Termination of Employment
|
(a)
|
except as provided in Paragraph 4 for a Change in Control, the expiration of 30 days after the date your employment is terminated for any reason other than Retirement (as defined in the Plan), death, Disability or discharge for Cause (as defined in the Plan);
|
(b)
|
the third anniversary of your termination by reason of Retirement, death or Disability;
|
(c)
|
the termination date if the termination is for Cause; or
|
(d)
|
the Expiration Date.
|
4.
|
Merger, Consolidation or Change in Control
|
5.
|
Limited Transferability of Option
|
(a)
|
your spouse, children or grandchildren ("Immediate Family Members");
|
(b)
|
a trust or trusts for the exclusive benefit of such Immediate Family Members, or;
|
(c)
|
a partnership in which such Immediate Family Members are the only partners, provided that:
|
(i)
|
there may be no consideration for any such transfer;
|
(ii)
|
subsequent transfers of the transferred Option shall be prohibited, except to designated beneficiaries; and
|
(iii)
|
such transfer is evidenced by documents acceptable to the Company and filed with the Corporate Secretary.
|
6.
|
Securities Law Restrictions
|
7.
|
Tax Consequences
|
8.
|
Employment of Successors
|
9.
|
Conformity with Plan
|
10.
|
Post-Vesting Holding Period; Clawback
|
(a)
|
For a period of twelve (12) months after any exercise of this Option, you agree to hold and remain the sole owner of, and to not transfer or otherwise reduce your risk with respect to shares acquired upon such exercise. This post-vesting holding period requirement (i) will not apply to prevent withholding of shares to satisfy taxes under paragraph (2) above, and (ii) will cease upon your death, Disability, discharge by the Company without Cause, voluntary termination of employment for Good Reason or a Change in Control.
|
(b)
|
In the event (i) you voluntarily terminate your employment (other than for “Good Reason”) or are terminated for “Cause” after the vesting of the Options on December 31, 2011, and (ii) you provide any services, directly or indirectly, with respect to products or services which are “competing products or services” or breach any of your obligations under your Employment Agreement, then (A) you shall forfeit and may no longer exercise any unexercised portion of the Option, and (B) upon written demand from the Company, you shall repay to the Company a cash sum equal to the fair market value of the net after-tax number of Shares which you had received upon any exercise of the Option during the twelve-month period immediately preceding the date you first provided such services or committed such breach. Such fair market value shall be determined as of the date of exercise. For purposes of this Letter Agreement, a “competing product or service” is a product or service which is offered by any banking or financial institution within the Market Area that competes with a product or service provided by the Company or its subsidiaries as of the date of your termination of employment. For purposes of this Letter Agreement, “Good Reason” and “Cause” shall have the meaning set forth in your Employment Agreement and “Market Area” shall have the meaning set forth in your Employment Agreement for purposes of clauses (a) and (b) of Section 15 thereof. Any repayment under this Paragraph (10) shall be in addition to any other remedies which the Company may have under your Employment Agreement.
|
|
Very truly yours,
|
(1)
|
Award
|
(a)
|
The Company hereby grants to you an Award of [______] shares of Common Stock, subject to the restrictions and other conditions set forth herein. Such shares are referred to in this Letter Agreement as the “Restricted Shares.” Restricted Shares may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated subject to Sections (2), (3) and (4). Within a reasonable time after the date of this Award, the Company shall instruct its transfer agent to establish a book entry account representing the Restricted Shares in your name effective as of the Date of Grant, provided that the Company shall retain control of such account until the Restricted Shares have become vested in accordance with the Award.
|
(b)
|
As promptly as practical after the date on which a portion or all of the Restricted Shares vest under this Agreement, and after receipt of any required tax withholding under Section 8, the Company shall instruct the transfer agent to transfer the number of vested Restricted Shares (less any shares withheld in satisfaction of tax withholding obligations under Section 8, if any) to an unrestricted account over which only you have control.
|
(2)
|
Restrictions; Vesting.
|
(3)
|
Termination of Employment
|
(4)
|
Merger, Consolidation or Change in Control
|
(5)
|
Non-Transferability
|
(6)
|
Securities Law Restrictions
|
(9)
|
Tax Consequences
|
(10)
|
Employment; Successors
|
(11)
|
Conformity with Plan
|
(a)
|
The Award is intended to conform in all respects with the Plan. Inconsistencies between this Agreement and the Plan shall be resolved in accordance with the terms of the Plan. By executing and returning the enclosed Confirmation of Acceptance of this Letter Agreement, you agree to be bound by all the terms hereof and of the Plan. Except as otherwise expressly provided herein, all definitions stated in the Plan shall be fully applicable to this Letter Agreement.
|
(b)
|
Any action taken or decision made by the Compensation Committee of the Company’s Board of Directors arising out of or in connection with the construction, administration, interpretation or effect of this Agreement or the Plan, shall lie within sole and absolute discretion, as the case may be, and shall be final, conclusive and binding on you and all
|
|
persons claiming under or through you. This Agreement shall be binding upon your heirs, executors, administrators and successors.
|
(c)
|
This Agreement shall be construed and interpreted in accordance with the laws of the State of Delaware.
|
|
(a)
|
For a period of twelve (12) months after the Restricted Shares vest, you agree to hold and remain the sole owner of, and to not transfer or otherwise reduce your risk with respect to such Restricted Shares. This post-vesting holding period requirement (i) will not apply to prevent withholding of Restricted Shares under Section (8) above, and (ii) will cease upon your death, Disability, discharge by the Company without Cause, voluntary termination of employment for Good Reason or a Change in Control.
|
|
(b)
|
In the event (i) you voluntarily terminate your employment (other than for “Good Reason”) or are terminated for “Cause” after vesting of the Restricted Shares on December 31, 2011, and (ii) you provide any services, directly or indirectly, with respect to products or services which are “competing products or services” or breach any of your obligations under your Employment Agreement, in each case, prior to January 1, 2013, then, upon written demand from the Company, you shall repay to the Company a cash sum equal to the fair market value of the net after-tax number of Restricted Shares in which you vested. Such fair market value shall be determined as of the date the Restricted Shares vested. For purposes of this Letter Agreement, a “competing product or service” is a product or service which is offered by any banking or financial institution within the Market Area that competes with a product or service provided by the Company or its subsidiaries as of the date of your termination of employment. For purposes of this Letter Agreement, “Good Reason” and “Cause” shall have the meaning set forth in your Employment Agreement and “Market Area” shall have the meaning set forth in your Employment Agreement for purposes of clauses (a) and (b) of Section 15 thereof.
|
FIRST MIDWEST BANCORP, INC.
|
|
By: /s/ Michael L. Scudder
Name: Michael L. Scudder
Title: President and Chief Executive Officer
|
|
By:
Name:
|
(i)
|
25% in cash; and
|
(ii)
|
75% in an Award of Shares which shall be calculated by: (A) multiplying the Net Pay Period Amount by .75 (the “Share Value Amount”); and (B) dividing the Share Value Amount by the closing price of the Shares as of the date immediately preceding the applicable Grant Date. If any fractional share results from this calculation, the number of Shares shall be rounded down to the nearest whole share with cash paid in lieu of the fractional share.
|
FIRST MIDWEST BANCORP, INC.
|
|
By: /s/ Michael L. Scudder
Name: Michael L. Scudder
Title: President and Chief Executive Officer
|
|
By:
Name:
|
·
|
Registration Statement (Form S-3 No. 33-20439) pertaining to the First Midwest Bancorp, Inc. Dividend Reinvestment and Stock Purchase Plan
|
·
|
Registration Statement (Form S-3 No. 333-132137) pertaining to a First Midwest Bancorp, Inc. debt and equity securities offering
|
·
|
Registration Statement (Form S-4 No. 333-114406) pertaining to First Midwest Capital Trust I
|
·
|
Registration Statement (Form S-8 No. 33-25136) pertaining to the First Midwest Bancorp, Inc. Savings and Profit Sharing Plan
|
·
|
Registration Statement (Form S-8 No. 33-42980) pertaining to the First Midwest Bancorp, Inc. 1989 Omnibus Stock and Incentive Plan
|
·
|
Registration Statement (Form S-8 No. 333-42273) pertaining to the First Midwest Bancorp, Inc. 1989 Omnibus Stock and Incentive Plan
|
·
|
Registration Statement (Form S-8 No. 333-61090) pertaining to the First Midwest Bancorp, Inc. 1989 Omnibus Stock and Incentive Plan
|
·
|
Registration Statement (Form S-8 No. 333-50140) pertaining to the First Midwest Bancorp, Inc. Non-employee Directors’ 1997 Stock Option Plan
|
·
|
Registration Statement (Form S-8 No. 333-63095) pertaining to the First Midwest Bancorp, Inc. Non-employee Directors’ Stock Option Plan
|
·
|
Registration Statement (Form S-8 No. 333-63097) pertaining to the First Midwest Bancorp, Inc. Nonqualified Retirement Plan
|
·
|
Registration Statement (Form S-8 No. 333-151072) pertaining to the First Midwest Bancorp, Inc. Amended and Restated Non-employee Director Stock Plan
|
·
|
Registration Statement (Form S-3 No. 333-157615) pertaining to a First Midwest Bancorp, Inc. debt and equity securities offering
|
·
|
Registration Statement (Form S-8 No. 333-168973) pertaining to the First Midwest Bancorp, Inc. Amended and Restated Omnibus Stock and Incentive Plan
|
I, Michael L. Scudder, certify that:
|
|||||
1.
|
I have reviewed this report on Form 10-Q of First Midwest Bancorp Inc.;
|
||||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
||||
3.
|
Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
||||
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
||||
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||||
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||||
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||||
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
||||
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
|
||||
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
||||
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
||||
Date:
|
August 9, 2011
|
/S/ MICHAEL L. SCUDDER
|
|||
[Signature]
President and Chief Executive Officer
|
I, Paul F. Clemens, certify that:
|
|||||
1.
|
I have reviewed this report on Form 10-Q of First Midwest Bancorp Inc.;
|
||||
2.
|
Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
||||
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
||||
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
||||
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||||
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||||
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||||
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
||||
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
|
||||
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
||||
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
||||
Date:
|
August 9, 2011
|
/S/ PAUL F. CLEMENS
|
|||
[Signature]
Executive Vice President
and Chief Financial Officer
|
(1)
|
The Company’s Report on Form 10-Q for the quarter ended June 30, 2011 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities and Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/S MICHAEL L. SCUDDER
|
|
Name:
|
Michael L. Scudder
|
Title:
|
President and Chief Executive Officer
|
(1)
|
The Company’s Report on Form 10-Q for the quarter ended June 30, 2011 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities and Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/S/ PAUL F. CLEMENS
|
|
Name:
|
Paul F. Clemens
|
Title:
|
Executive Vice President
and Chief Financial Officer
|
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