EX-99.1 2 ex99-1.htm EXHIBIT 99.1, SECOND QUARTER EARNINGS PRESS RELEASE ex99-1.htm

Exhibit 99.1

NEWS RELEASE

For Immediate Release
July 23, 2007

For Further Information Contact:
Charles R. Hageboeck, Chief Executive Officer and President
(304) 769-1102

City Holding Company Announces Second Quarter Earnings

Charleston, West Virginia – City Holding Company, “the Company” (NASDAQ:CHCO), a $2.5 billion bank holding company headquartered in Charleston, today announced net income for the second quarter of $12.3 million or $0.72 per diluted share compared to $13.8 million or $0.77 per diluted share in the second quarter of 2006.  For the second quarter of 2007, the Company achieved a return on assets of 1.94%, a return on equity of 16.1%, a net interest margin of 4.32%, and an efficiency ratio of 45.7%.  This compares with a return on assets of 2.17%, a return on equity of 18.8%, a net interest margin of 4.58%, and an efficiency ratio of 44.1% for the comparable period of 2006.

Charles Hageboeck, Chief Executive Officer and President, noted, “The Company’s earnings for the second quarter of 2007 decreased by $1.4 million.  Decreases of $0.7 million in interest income associated with previously securitized loans (the average balances of which decreased 53%), and $0.6 million in lower credit card fee income as a result of the sales of our retail portfolio and merchant credit card processing agreements were previously anticipated.  Additionally, the Company recorded an increase of $0.9 million to our provision for loan losses due to difficulties encountered by a single borrower during the quarter. As a result, the provision recorded during the second quarter was $1.6 million and nonaccrual loans increased by $5.0 million.  Despite this increase in non-performing assets, the Company’s asset quality remains strong and comparable to our peer group (bank holding companies with total assets between $1 and $5 billion).  Although the Company has incurred higher provision for loan losses than it has since the fourth quarter of 2001, the Company remains one of the most profitable banks in the industry with return on assets of 1.94%.  We continue to focus on maintaining City’s status as one of the most profitable banks in the industry while focusing on achieving reasonable growth given the markets in which we operate.  To that end, we opened a new branch in Ripley, WV and relocated our Company’s eastern panhandle headquarters into a new 7,500 square foot office in Martinsburg, WV during the second quarter.  We also broke ground for our new branch location in Princeton, WV during the second quarter and expect this branch to open in November 2007.  Additionally we are pleased to announce plans to open a new branch in Hurricane, WV during the first quarter of 2008.

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The two largest sources of non-interest income – branch service charges and insurance revenues, both showed solid growth in the second quarter, and the Company has continued to recruit additional talent to strengthen our ability to compete effectively in our markets.  During the quarter, the Company was able to repurchase 305,900 shares of its common stock and maintain its strong tangible equity to tangible assets ratio of 9.6% at June 30, 2007.    We look forward to continuing our solid performance for our shareholders despite the many challenges currently facing financial services institutions.”

Balance Sheet Trends

As compared to December 31, 2006, loans have increased $52.9 million (3.2%) at June 30, 2007 with increases in loans to depository institutions of $35.0 million, (140.0%), home equity loans of $8.5 million (2.6%), commercial loans of $7.7 million (1.1%), installment loans of $4.5 million (10.4%), and residential real estate loans of $2.5 million (0.4%).  These increases were partially offset by decreases in previously securitized loans of $5.3 million (see Previously Securitized Loans).

Total average depository balances increased $32.2 million, or 1.6%, from the quarter ended December 31, 2006 to the quarter ended June 30, 2007.  This growth was primarily in savings and time deposits, which have increased $27.5 million and $7.9 million, respectively.

Net Interest Income

The Company’s tax equivalent net interest income decreased $1.6 million, or 6.1%, from $26.2 million during the second quarter of 2006 to $24.6 million during the second quarter of 2007.  This decrease is attributable to two factors.  First, the Company experienced a decrease of $0.7 million in interest income from previously securitized loans in the second quarter of 2007 as compared to the second quarter of 2006 as the average balance of these loans decreased 53.4%.  The decrease in average balances was partially mitigated by an increase in the yield on these loans from 41.9% for the second quarter of 2006 to 66.4% for the second quarter of 2007 (see Previously Securitized Loans).  Secondly, during the third quarter of 2006, the Company sold its retail credit card portfolio.  Average credit card loans outstanding were $13.1 million in the second quarter of 2006. This resulted in a decrease in interest income of $0.5 million from the second quarter of 2006.  An increase of $2.6 million in interest income from all other loans (commercial, residential, home equity, and consumer) was offset by an increase of $2.6 million in interest expense on deposits.

The Company’s net interest margin was 4.32% in the second quarter of 2007 as compared to 4.58% in the second quarter of 2006.  The decline in the net interest margin can be partially attributed to lower interest income from previously securitized loans and the loss of interest income due to the sale of the retail credit card portfolio.  Excluding these assets, the Company’s net interest margin decreased 15 basis points from 4.20% during the second quarter of 2006 to 4.05% for the second quarter of 2007.  This compression is due to an increase in the rate paid on total interest-bearing liabilities, and reflects an increase in the cost of time deposits.

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Credit Quality

At June 30, 2007, the Allowance for Loan Losses (“ALLL”) was $16.6 million or 0.96% of total loans outstanding and 145% of non-performing loans compared to $16.1 million or 0.95% of loans outstanding and 236% of non-performing loans at March 31, 2007, and $15.4 million or 0.92% of loans outstanding and 385% of non-performing loans at December 31, 2006.

As a result of the Company’s quarterly analysis of the adequacy of the ALLL, the Company recorded a provision for loan losses of $1.6 million in the second quarter of 2007 compared to $0.7 million for the comparable period in 2006.  The Company’s provision reflects the difficulties encountered by one of the Company’s borrowers (which has been engaged in residential construction of several properties) and the downgrade of five related credits.  While the downgrade of this credit relationship unfavorably impacted the provision and resulted in an increase in nonaccrual loans of $5.0 million, the quality of the Company’s loan portfolio (exclusive of the aforementioned credits) continues to improve.  Total past due loans have declined 15% from $9.9 million at December 31, 2006 to $8.3 million at June 30, 2007.  This improvement has been primarily associated with residential real estate loans (down 1.2 million or 26%) from December 31, 2006.  Changes in the amount of the provision and related allowance are based on the Company’s detailed methodology and are directionally consistent with changes in credit quality and growth and changes in the composition and quality of the Company’s loan portfolio.

The Company had net charge-offs of $1.1 million for the second quarter of 2007, with depository accounts representing $0.6 million (or approximately 55%) of this total. While charge-offs on depository accounts are appropriately taken against the ALLL, the revenue associated with depository accounts is reflected in service charges and has been steadily growing as the core base of checking accounts has grown.  Net charge-offs on residential and commercial loans were $0.4 million and $0.1 million, respectively, while installments loans experienced no net charge-offs for the quarter ended June 30, 2007.  The increase in residential loans was primarily related to four credits that had been appropriately considered in establishing the allowance for loan losses in prior periods.  The Company has experience annualized net charge-offs related to loans (excluding overdrafts) of 0.13% for 2007 year to date compared with 0.11% for 2006 and 0.22% for 2005.  The trend in net charge-offs is attributable to declines in balances of loans originated prior to 2002 (including loans acquired as part of the Classic Bancshares acquisition).  At June 30, 2007, balances of loans written subsequent to 2002 comprise approximately 75% of total loan balances.

The Company’s ratio of non-performing assets to total loans and other real estate owned increased from 0.44% at March 31, 2007 to 0.71% at June 30, 2007 as a result of the downgrade of the credit relationship discussed earlier.  Our ratio of non-performing assets to total loans continues to compare favorably to that of our peer group (bank holding companies with total assets between $1 and $5 billion), which reported average non-performing assets as a percentage of loans and other real estate owned of 0.80% for the most recently reported quarter ended March 31, 2007.  The composition of the Company’s loan portfolio, which is weighted more heavily toward residential mortgage loans and less towards non-real estate secured commercial

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loans than that of our peers, has allowed us to maintain a lower allowance in comparison to peers.  In addition, the sale of the Company’s credit card portfolio resulted in a reduction of the allowance of $1.4 million during 2006.  As a result, the Company’s ALLL as a percentage of loans outstanding is 0.96% at June 30, 2007.  The Company believes its methodology for determining the adequacy of its ALLL adequately provides for probable losses inherent in the loan portfolio and produces a provision and allowance for loan losses that is directionally consistent with changes in asset quality and loss experience.

 Non-interest Income

Net of investment security gains, non-interest income increased $0.2 million to $13.6 million in the second quarter of 2007 as compared to $13.4 million in the second quarter of 2006.  The largest source of non-interest income is service charges from depository accounts, which increased $0.5 million, or 4.8%, from $10.9 million during the second quarter of 2006 to $11.4 million during the second quarter of 2007.  Insurance commission revenues increased $0.3 million, or 59.7% due to the hiring of additional staff by City Insurance to provide worker’s compensation insurance to West Virginia businesses and to bolster the Company’s team of insurance agents focused on selling directly to retail customers.  Partially off-setting these increases was a decrease in other income of $0.5 million due to lower credit card fee income as a result of the sale of the retail credit card portfolio during the third quarter of 2006 and the sale of the merchant credit card processing agreements during the first quarter of 2007.

Non-interest Expenses

Non-interest expenses remained flat at $17.5 million for both the second quarter of 2006 and the second quarter of 2007.  Salaries and employee benefits increased $0.2 million, or 1.7%, from the second quarter of 2006 due to additional staffing while bankcard expenses increased $0.1 million, or 30.3%, due to increased usage by customers.  These increases were essentially offset by decreases in other expenses of $0.2 million, or 8.9% due to the sales of the retail and merchant credit card portfolios and a decrease of $0.2 million, or 32.6%, in professional fees that was attributable to lower legal and consulting expenses.

The Company’s efficiency ratio declined modestly from 44.1% for the quarter ended June 30, 2006 to 45.7% for the quarter ended June 30, 2007.  This decline is directly attributable to a decrease in the Company’s net interest income, as non-interest expenses remained stable from the second quarter of 2006 to the second quarter of 2007.  The average efficiency ratio for the Company’s peer group for the most recently reported quarter was 59.0%.

Previously Securitized Loans

At June 30, 2007, the Company reported “Previously Securitized Loans” of $10.3 million compared to $12.7 million at March 31, 2007, $15.6 million at December 31, 2006, and $22.3 million at June 30, 2006, respectively.  The balance of previously securitized loans has decreased 19.0%, 33.8%, and 53.6% from March 31, 2007, December 31, 2006, and June 30, 2006, respectively.  The yield on the previously securitized loans was 66.4% for the quarter ended June 30, 2007, compared to 49.5% for the quarter ended March 31, 2007, 46.6% for the quarter ended

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December 31, 2006, and 41.9% for the quarter ended June 30, 2006.  The yield on the previously securitized loans has increased due to improved cash flows as net default rates have been less than previously estimated and increased prepayment rates that have continued to exceed our previous estimates.  The default rates have decreased as a result of the Company’s assumption of the servicing of all of the pool balances during the second quarter of 2005.  Subsequent to our assumption of the servicing of these loans, the Company has averaged net recoveries but does not believe that the trend of net recoveries can be sustained indefinitely.

Capitalization and Liquidity

One of the Company’s strengths is that it is highly profitable while maintaining strong liquidity and capital.  With respect to liquidity, the Company’s loan to deposit ratio was 85.9% and the loan to asset ratio was 68.5% at June 30, 2007.  The Company maintained investment securities totaling 19.6% of assets as of June 30, 2007.  Further, the Company’s deposit mix is weighted heavily toward checking and saving accounts that fund 43.3% of assets at June 30, 2007.  Time deposits fund 36.5% of assets at June 30, 2007, but very few of these deposits are in accounts that have balances of more than $150,000, reflecting the core retail orientation of the Company.

The Company is also strongly capitalized. With respect to regulatory capital, at June 30, 2007, the Company’s Leverage Ratio is 10.52%, the Tier I Capital ratio is 15.15 %, and the Total Risk-Based Capital ratio is 16.12%.  These regulatory capital ratios are significantly above levels required to be considered “well capitalized,” which is the highest possible regulatory designation.

During the quarter ended June 30, 2007, the Company repurchased 305,900 common shares at a weighted average price of $38.53 as part of a one million share repurchase plan authorized by the Board of Directors in December 2006.  The Company’s tangible equity ratio was 9.6% at June 30, 2007 compared with a tangible equity ratio of 10.0% at December 31, 2006.

City Holding Company is the parent company of City National Bank of West Virginia.  City National operates 68 branches across West Virginia, Eastern Kentucky and Southeastern Ohio.

Forward-Looking Information

This news release contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Such information involves risks and uncertainties that could result in the Company's actual results differing from those projected in the forward-looking statements. Important factors that could cause actual results to differ materially from those discussed in such forward-looking statements include, but are not limited to, (1) the Company may incur additional loan loss provision due to negative credit quality trends in the future that may lead to a deterioration of asset quality; (2) the Company may incur increased charge-offs in the future; (3) the Company may experience increases in the default rates or decreased prepayments on previously securitized loans that would result in impairment losses or lower the yield on such loans; (4) the Company may continue to benefit from strong recovery efforts on previously securitized loans resulting in improved yields on these assets; (5)  the Company could have adverse legal actions of a material

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nature; (6) the Company may face competitive loss of customers; (7) the Company may be unable to manage its expense levels; (8) the Company may have difficulty retaining key employees; (9) changes in the interest rate environment may have results on the Company’s operations materially different from those anticipated by the Company’s market risk management functions; (10) changes in general economic conditions and increased competition could adversely affect the Company’s operating results; (11) changes in other regulations and government policies affecting bank holding companies and their subsidiaries, including changes in monetary policies, could negatively impact the Company’s operating results; and (12) the Company may experience difficulties growing loan and deposit balances.  Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist stockholders and potential investors in understanding current and anticipated financial operations of the Company and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made.


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Financial Highlights
                  
(Unaudited)
                  
                   
 
  
 
    
 
    
 
  
   
Three Months Ended June 30,
    
Percent
  
   
2007
    
2006
    
Change
  
                   
Earnings ($000s, except per share data):
                  
Net Interest Income (FTE)
   $
24,566
     $
26,171
       (6.13 )%
Net Income
    
12,322
      
13,761
       (10.46 )%
Earnings per Basic Share
    
0.72
      
0.78
       (7.69 )%
Earnings per Diluted Share
    
0.72
      
0.77
       (6.49 )%
 
                        
                         
Key Ratios (percent):
                        
Return on Average Assets
     1.94 %     2.17 %     (10.30 )%
Return on Average Equity
     16.06 %     18.83 %     (14.70 )%
Net Interest Margin
     4.32 %     4.58 %     (5.72 )%
Efficiency Ratio
     45.68 %     44.11 %     3.56 %
Average Shareholders' Equity to Average Assets
     12.11 %     11.51 %     5.19 %
                         
Consolidated Risk Based Capital Ratios (a):
                        
Tier I
     15.15 %     14.57 %     3.98 %
Total
     16.12 %     15.44 %     4.40 %
                         
Average Tangible Equity to Average Tangible Assets
     9.58 %     9.13 %     4.87 %
 
                        
                         
Common Stock Data:
                        
Cash Dividends Declared per Share
   $
0.31
     $
0.28
       10.71 %
Book Value per Share
    
17.40
      
16.24
       7.14 %
Tangible Book Value per Share
    
13.95
      
12.86
       8.49 %
Market Value per Share:
                        
High
    
40.93
      
37.31
       9.70 %
Low
    
37.67
      
34.53
       9.09 %
End of Period
    
38.33
      
36.14
       6.06 %
                         
Price/Earnings Ratio (b)
    
13.31
      
11.58
       14.90 %
   
Six Months Ended
          
   
Six Months Ended June 30,
    
Percent
  
   
2007
    
2006
    
Change
  
                         
Earnings ($000s, except per share data):
                        
Net Interest Income (FTE)
   $
49,236
     $
52,276
       (5.82 )%
Net Income
    
25,553
      
26,627
       (4.03 )%
Earnings per Basic Share
    
1.48
      
1.49
       (0.67 )%
Earnings per Diluted Share
    
1.48
      
1.49
       (0.67 )%
 
                        
                         
Key Ratios (percent):
                        
Return on Average Assets
     2.02 %     2.12 %     (4.37 )%
Return on Average Equity
     16.59 %     18.10 %     (8.29 )%
Net Interest Margin
     4.36 %     4.64 %     (6.04 )%
Efficiency Ratio
     45.29 %     44.69 %     1.34 %
Average Shareholders' Equity to Average Assets
     12.19 %     11.69 %     4.28 %
 
                        
                         
Common Stock Data:
                        
Cash Dividends Declared per Share
   $
0.62
     $
0.56
       10.71 %
Market Value per Share:
                        
High
    
41.54
      
37.64
       10.36 %
Low
    
37.67
      
34.53
       9.09 %
                         
                         
(a) June 30, 2007 risk-based capital ratios are estimated
                  
(b) June 30, 2007 price/earnings ratio computed based on annualized second quarter 2007 earnings
          

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CITY HOLDING COMPANY AND SUBSIDIARIES
                          
Financial Highlights
                                
(Unaudited)
                                    
                                     
 
  
 
    
 
    
 
    
 
    
 
    
 
  
                                     
Book Value and Market Price Range per Share
                          
                           
Market Price
  
   
Book Value per Share
    
Range per Share
  
   
March 31
    
June 30
    
September 30
    
December 31
    
Low
    
High
  
                                     
2003
   $
10.10
     $
10.74
     $
11.03
     $
11.46
     $
25.50
     $
37.15
  
2004
    
12.09
      
11.89
      
12.70
      
13.03
      
27.30
      
37.58
  
2005
    
13.20
      
15.56
      
15.99
      
16.14
      
27.57
      
39.21
  
2006
    
16.17
      
16.17
      
16.99
      
17.46
      
34.53
      
41.87
  
2007
    
17.62
      
17.40
                      
37.67
      
40.93
  
 
                                                
                                                 
Earnings per Basic Share
                                          
                                                 
   
Quarter Ended
          
   
March 31
    
June 30
    
September 30
    
December 31
    
Year-to-Date
          
                                                 
2003
   $
0.56
     $
0.73
     $
0.69
     $
0.64
     $
2.62
          
2004
    
0.66
      
0.80
      
0.66
      
0.67
      
2.79
          
2005
    
0.70
      
0.72
      
0.73
      
0.72
      
2.87
          
2006
    
0.71
      
0.78
      
0.78
      
0.74
      
3.00
          
2007
    
0.76
      
0.72
                      
1.48
          
 
                                                
                                                 
Earnings per Diluted Share
                                          
                                                 
   
Quarter Ended
          
   
March 31
    
June 30
    
September 30
    
December 31
    
Year-to-Date
          
                                                 
2003
   $
0.55
     $
0.72
     $
0.68
     $
0.63
     $
2.58
          
2004
    
0.65
      
0.79
      
0.65
      
0.66
      
2.75
          
2005
    
0.69
      
0.71
      
0.72
      
0.72
      
2.84
          
2006
    
0.71
      
0.77
      
0.77
      
0.74
      
2.99
          
2007
    
0.76
      
0.72
                      
1.48
          
 
                                                

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Consolidated Statements of Income
            
(Unaudited) ($ in 000s, except per share data)
            
             
   
Three Months Ended June 30,
  
   
2007
    
2006
  
             
Interest Income
            
Interest and fees on loans
   $
31,947
     $
30,451
  
Interest on investment securities:
                
Taxable
    
6,752
      
7,489
  
Tax-exempt
    
427
      
455
  
Interest on loans held for sale
    
-
      
200
  
Interest on deposits in depository institutions
    
113
      
415
  
Interest on federal funds sold
    
291
      
-
  
Total Interest Income
    
39,530
      
39,010
  
                 
Interest Expense
                
Interest on deposits
    
13,077
      
10,520
  
Interest on short-term borrowings
    
1,694
      
1,326
  
Interest on long-term debt
    
425
      
1,239
  
Total Interest Expense
    
15,196
      
13,085
  
Net Interest Income
    
24,334
      
25,925
  
Provision for loan losses
    
1,600
      
675
  
Net Interest Income After Provision for Loan Losses
    
22,734
      
25,250
  
                 
Non-Interest Income
                
Investment securities gains
    
45
      
-
  
Service charges
    
11,426
      
10,903
  
Insurance commissions
    
832
      
521
  
Trust and investment management fee income
    
437
      
504
  
Bank owned life insurance
    
585
      
678
  
Other income
    
364
      
857
  
Total Non-Interest Income
    
13,689
      
13,463
  
                 
Non-Interest Expense
                
Salaries and employee benefits
    
8,912
      
8,764
  
Occupancy and equipment
    
1,525
      
1,624
  
Depreciation
    
1,109
      
1,071
  
Professional fees
    
385
      
571
  
Postage, delivery, and statement mailings
    
569
      
689
  
Advertising
    
880
      
755
  
Telecommunications
    
460
      
525
  
Bankcard expenses
    
597
      
458
  
Insurance and regulatory
    
383
      
381
  
Office supplies
    
442
      
372
  
Repossessed asset losses (gains), net of expenses
    
9
       (129 )
Other expenses
    
2,254
      
2,474
  
Total Non-Interest Expense
    
17,525
      
17,555
  
Income Before Income Taxes
    
18,898
      
21,158
  
Income tax expense
    
6,576
      
7,397
  
Net Income
   $
12,322
     $
13,761
  
                 
Basic earnings per share
   $
0.72
     $
0.78
  
Diluted earnings per share
   $
0.72
     $
0.77
  
Average Common Shares Outstanding:
                
Basic
    
17,100
      
17,719
  
Diluted
    
17,158
      
17,772
  
 
-11-
 
           
Consolidated Statements of Income
            
(Unaudited) ($ in 000s, except per share data)
            
             
   
Six months ended June 30
  
   
2007
    
2006
  
             
Interest Income
            
Interest and fees on loans
   $
63,411
     $
60,014
  
Interest on investment securities:
                
Taxable
    
13,686
      
14,748
  
Tax-exempt
    
855
      
922
  
Interest on loans held for sale
    
-
      
200
  
Interest on deposits in depository institutions
    
230
      
566
  
Interest on federal funds sold
    
547
      
-
  
Total Interest Income
    
78,729
      
76,450
  
                 
Interest Expense
                
Interest on deposits
    
25,788
      
19,721
  
Interest on short-term borrowings
    
3,207
      
2,452
  
Interest on long-term debt
    
957
      
2,499
  
Total Interest Expense
    
29,952
      
24,672
  
Net Interest Income
    
48,777
      
51,778
  
Provision for loan losses
    
2,500
      
1,675
  
Net Interest Income After Provision for Loan Losses
    
46,277
      
50,103
  
                 
Non-Interest Income
                
Investment securities gains
    
45
      
-
  
Service charges
    
21,489
      
20,764
  
Insurance commissions
    
1,844
      
1,135
  
Trust and investment management fee income
    
1,005
      
1,070
  
Bank owned life insurance
    
1,281
      
1,215
  
Gain on sale of credit card merchant agreements
    
1,500
      
-
  
Other income
    
877
      
1,667
  
Total Non-Interest Income
    
28,041
      
25,851
  
                 
Non-Interest Expense
                
Salaries and employee benefits
    
17,969
      
17,396
  
Occupancy and equipment
    
3,162
      
3,223
  
Depreciation
    
2,179
      
2,121
  
Professional fees
    
788
      
966
  
Postage, delivery, and statement mailings
    
1,346
      
1,333
  
Advertising
    
1,732
      
1,529
  
Telecommunications
    
915
      
1,001
  
Bankcard expenses
    
1,115
      
1,001
  
Insurance and regulatory
    
768
      
769
  
Office supplies
    
897
      
754
  
Repossessed asset (gains), net of expenses
     (5 )     (125 )
Loss on early extinguishment of debt
    
-
      
282
  
Other expenses
    
4,256
      
4,802
  
Total Non-Interest Expense
    
35,122
      
35,052
  
Income Before Income Taxes
    
39,196
      
40,902
  
Income tax expense
    
13,643
      
14,275
  
Net Income
   $
25,553
     $
26,627
  
                 
Basic earnings per share
   $
1.48
     $
1.49
  
Diluted earnings per share
   $
1.48
     $
1.49
  
Average Common Shares Outstanding:
                
Basic
    
17,230
      
17,860
  
Diluted
    
17,292
      
17,917
  
 
-12-
 
CITY HOLDING COMPANY AND SUBSIDIARIES
            
Consolidated Statements of Changes in Stockholders' Equity
            
(Unaudited) ($ in 000s)
            
             
             
   
Three Months Ended
  
   
June 30, 2007
    
June 30, 2006
  
             
Balance at April 1
   $
303,354
     $
288,376
  
                 
Net income
    
12,322
      
13,761
  
Other comprehensive income:
                
Change in unrealized gain on securities available-for-sale
     (2,841 )     (2,994 )
Change in unrealized gain/(loss) on interest rate floors
     (1,122 )     (503 )
Cash dividends declared ($0.31/share)
     (5,256 )    
-
  
Cash dividends declared ($0.28/share)
    
-
       (4,919 )
Issuance of stock award shares, net
    
54
      
20
  
Exercise of 2,000 stock options
    
72
      
-
  
Exercise of 5,132 stock options
    
-
      
68
  
Excess tax benefits on stock compensation
    
3
      
22
  
Purchase of 305,900 common shares of treasury
     (11,803 )    
-
  
Purchase of 271,481 common shares of treasury
    
-
       (9,711 )
Balance at June 30
   $
294,783
     $
284,120
  
                 
                 
                 
   
Six Months Ended
  
   
June 30, 2007
    
June 30, 2006
  
                 
Balance at January 1
   $
305,307
     $
292,141
  
                 
  Cumulative effect of adopting FIN 48
     (125 )   $
-
  
Net income
    
25,553
      
26,627
  
Other comprehensive income:
                
Change in unrealized gain on securities available-for-sale
     (2,118 )     (3,911 )
Change in unrealized gain/(loss) on interest rate floors
     (1,000 )     (1,012 )
Cash dividends declared ($0.62/share)
     (10,598 )    
-
  
Cash dividends declared ($0.56/share)
    
-
       (9,907 )
Issuance of stock award shares, net
    
318
      
187
  
Exercise of 7,300 stock options
    
154
      
-
  
Exercise of 32,007 stock options
    
-
      
425
  
Excess tax benefits on stock compensation
    
3
      
195
  
Purchase of 580,200 common shares of treasury
     (22,711 )    
-
  
Purchase of 572,053 common shares of treasury
    
-
       (20,625 )
Balance at June 30
   $
294,783
     $
284,120
  
 
 
-13-
 
                   
Condensed Consolidated Quarterly Statements of Income
              
(Unaudited) ($ in 000s, except per share data)
                    
                               
   
Quarter Ended
  
   
June 30
    
March 31
    
Dec. 31
    
Sept. 30
    
June 30
  
   
2007
    
2007
    
2006
    
2006
    
2006
  
                               
Interest income
   $
39,530
     $
39,198
     $
39,925
     $
39,747
     $
39,010
  
Taxable equivalent adjustment
    
231
      
230
      
228
      
236
      
246
  
Interest income (FTE)
    
39,761
      
39,428
      
40,153
      
39,983
      
39,256
  
Interest expense
    
15,196
      
14,756
      
14,820
      
14,233
      
13,085
  
Net interest income
    
24,565
      
24,672
      
25,333
      
25,750
      
26,171
  
Provision for loan losses
    
1,600
      
900
      
901
      
1,225
      
675
  
Net interest income after provision
                                        
for loan losses
    
22,965
      
23,772
      
24,432
      
24,525
      
25,496
  
                                         
Noninterest income
    
13,689
      
14,371
      
13,586
      
14,766
      
13,463
  
Noninterest expense
    
17,525
      
17,616
      
18,099
      
18,133
      
17,555
  
Income before income taxes
    
19,129
      
20,527
      
19,919
      
21,158
      
21,404
  
Income tax expense
    
6,576
      
7,066
      
6,752
      
7,302
      
7,397
  
Taxable equivalent adjustment
    
231
      
230
      
228
      
236
      
246
  
Net income
   $
12,322
     $
13,231
     $
12,939
     $
13,620
     $
13,761
  
                                         
 
                                        
                                         
Basic earnings per share
   $
0.72
     $
0.76
     $
0.74
     $
0.78
     $
0.78
  
Diluted earnings per share
    
0.72
      
0.76
      
0.74
      
0.77
      
0.77
  
Cash dividends declared per share
    
0.31
      
0.31
      
0.28
      
0.28
      
0.28
  
 
                                        
                                         
Average Common Share (000s):
                                        
Outstanding
    
17,100
      
17,369
      
17,535
      
17,557
      
17,719
  
Diluted
    
17,158
      
17,424
      
17,601
      
17,619
      
17,772
  
                                         
Net Interest Margin
     4.32 %     4.41 %     4.43 %     4.51 %     4.58 %
 
                                        
 
 
-14-
 
                             
Non-Interest Income and Non-Interest Expense
                              
(Unaudited) ($ in 000s)
                              
                               
   
Quarter Ended
  
   
June 30
    
March 31
    
Dec 31
    
Sept 30
    
June 30
  
   
2007
    
2007
    
2006
    
2006
    
2006
  
                               
Non-Interest Income:
                              
Service charges
   $
11,426
     $
10,063
     $
10,962
     $
10,833
     $
10,903
  
Insurance commissions
    
832
      
1,012
      
675
      
526
      
521
  
Trust and investment management fee income
    
437
      
568
      
498
      
572
      
504
  
Bank owned life insurance
    
585
      
696
      
576
      
561
      
678
  
Other income
    
364
      
513
      
803
      
778
      
857
  
Subtotal
    
13,644
      
12,852
      
13,514
      
13,270
      
13,463
  
Investment security gains
    
45
      
-
      
72
       (2,067 )    
-
  
Gain on sale of credit card merchant agreements
    
-
      
1,500
      
-
      
3,563
      
-
  
Total Non-Interest Income
   $
13,689
     $
14,352
     $
13,586
     $
14,766
     $
13,463
  
                                         
Non-Interest Expense:
                                        
Salaries and employee benefits
   $
8,912
     $
9,057
     $
8,354
     $
8,733
     $
8,764
  
Occupancy and equipment
    
1,525
      
1,637
      
1,655
      
1,602
      
1,624
  
Depreciation
    
1,109
      
1,070
      
1,037
      
1,061
      
1,071
  
Professional fees
    
385
      
403
      
415
      
379
      
571
  
Postage, delivery, and statement mailings
    
569
      
777
      
735
      
765
      
689
  
Advertising
    
880
      
852
      
876
      
810
      
755
  
Telecommunications
    
460
      
455
      
549
      
498
      
525
  
Bankcard expenses
    
597
      
518
      
478
      
485
      
458
  
Insurance and regulatory
    
383
      
385
      
375
      
384
      
381
  
Office supplies
    
442
      
455
      
408
      
417
      
372
  
Repossessed asset losses (gains), net of expenses
    
9
       (14 )    
6
      
20
       (129 )
Loss on early extinguishment of debt
    
-
      
-
      
708
      
379
      
-
  
Other expenses
    
2,254
      
2,002
      
2,503
      
2,600
      
2,474
  
Total Non-Interest Expense
   $
17,525
     $
17,597
     $
18,099
     $
18,133
     $
17,555
  
 
                                        
                                         
Employees (Full Time Equivalent)
    
807
      
791
      
779
      
767
      
779
  
Branch Locations
    
68
      
68
      
67
      
67
      
67
  
 
                                        
 
 
-15-
           
Consolidated Balance Sheets
            
($ in 000s)
            
   
June 30
    
December 31
  
   
2007
    
2006
  
   
(Unaudited)
        
Assets
            
Cash and due from banks
   $
60,163
     $
58,014
  
Interest-bearing deposits in depository institutions
    
14,507
      
27,434
  
Federal funds sold
    
20,000
      
25,000
  
Cash and cash equivalents
    
94,670
      
110,448
  
                 
Investment securities available-for-sale, at fair value
    
453,721
      
472,398
  
Investment securities held-to-maturity, at amortized cost
    
41,711
      
47,500
  
Total investment securities
    
495,432
      
519,898
  
                 
Gross Loans
    
1,730,354
      
1,677,469
  
Allowance for loan losses
     (16,616 )     (15,405 )
Net loans
    
1,713,738
      
1,662,064
  
                 
Bank owned life insurance
    
56,272
      
55,195
  
Premises and equipment
    
48,923
      
44,689
  
Accrued interest receivable
    
11,596
      
12,337
  
Net deferred tax assets
    
26,424
      
23,652
  
Intangible assets
    
58,504
      
58,857
  
Other assets
    
20,179
      
20,667
  
Total Assets
   $
2,525,738
     $
2,507,807
  
                 
Liabilities
                
Deposits:
                
Noninterest-bearing
   $
329,772
     $
321,038
  
Interest-bearing:
                
Demand deposits
    
416,331
      
422,925
  
Savings deposits
    
346,413
      
321,075
  
Time deposits
    
921,172
      
920,179
  
Total deposits
    
2,013,688
      
1,985,217
  
Short-term borrowings
    
164,545
      
136,570
  
Long-term debt
    
21,897
      
48,069
  
Other liabilities
    
30,825
      
32,644
  
Total Liabilities
    
2,230,955
      
2,202,500
  
                 
Stockholders' Equity
                
Preferred stock, par value $25 per share: 500,000 shares authorized; none issued
    
-
      
-
  
Common stock, par value $2.50 per share: 50,000,000 shares authorized;
                
    18,499,282 shares issued at June 30, 2007 and December 31, 2006
                
    less 1,562,095 and 1,009,095 shares in treasury, respectively
    
46,249
      
46,249
  
Capital surplus
    
103,422
      
104,043
  
Retained earnings
    
209,043
      
194,213
  
Cost of common stock in treasury
     (55,284 )     (33,669 )
Accumulated other comprehensive (loss):
                
Unrealized loss on securities available-for-sale
     (4,767 )     (2,649 )
Unrealized loss on derivative instruments
     (1,210 )     (210 )
Underfunded pension liability
     (2,670 )     (2,670 )
Total Accumulated Other Comprehensive (Loss)
     (8,647 )     (5,529 )
Total Stockholders' Equity
    
294,783
      
305,307
  
Total Liabilities and Stockholders' Equity
   $
2,525,738
     $
2,507,807
  
 
 
-16-
 
                   
Loan Portfolio
                              
(Unaudited) ($ in 000s)
                              
                               
   
June 30
    
March 31
    
Dec 31
    
Sept 30
    
June 30
  
   
2007
    
2007
    
2006
    
2006
    
2006
  
                               
Residential real estate
   $
601,045
     $
596,412
     $
598,502
     $
604,867
     $
601,097
  
Home equity
    
330,203
      
324,653
      
321,708
      
318,666
      
313,301
  
Commercial, financial, and agriculture
    
681,388
      
663,183
      
673,719
      
693,933
      
668,581
  
Loans to depository institutions
    
60,000
      
50,000
      
25,000
      
20,000
      
-
  
Installment loans to individuals
    
47,397
      
44,756
      
42,943
      
41,215
      
42,307
  
Previously securitized loans
    
10,321
      
12,744
      
15,597
      
18,520
      
22,253
  
Gross Loans
   $
1,730,354
     $
1,691,748
     $
1,677,469
     $
1,697,201
     $
1,647,539
  
                                         
                                         
                                         
CITY HOLDING COMPANY AND SUBSIDIARIES
                          
Previously Securitized Loans
                                        
(Unaudited) ($ in millions)
                                        
                   
Annualized
    
Effective
          
           
December 31
    
Interest
    
Annualized
          
   
Year Ended:
    
Balance (a)
    
Income (a)
    
Yield (a)
          
                                         
   
2006
     $
15.6
     $
9.4
       42 %        
   
2007
      
8.7
     $
7.0
       64 %        
   
2008
      
6.2
      
5.4
       71 %        
   
2009
      
4.7
      
4.0
       71 %        
   
2010
      
4.0
      
3.3
       71 %        
                                         
a - 2006 amounts are based on actual results. 2007 amounts are based on actual results through June 30, 2007 and estimated amounts for the remainder of the year. 2008, 2009, and 2010 amounts are based on estimated amounts.
  
 
           
Note: The amounts reflected in the table above require management to make significant assumptions based on estimated future default, prepayment, and discount rates.  Actual performance could be significantly different from that assumed, which could result in the actual results being materially different from the amounts estimated above.
 
 
-17-
 
                   
Consolidated Average Balance Sheets, Yields, and Rates
              
(Unaudited) ($ in 000s)
                                    
                                     
   
Three Months Ended June 30,
  
         
2007
                
2006
        
   
Average
          
Yield/
    
Average
          
Yield/
  
   
Balance
    
Interest
    
Rate
    
Balance
    
Interest
    
Rate
  
                                     
Assets:
                                    
Loan portfolio:
                                    
Residential real estate
   $
596,246
     $
9,017
       6.07 %   $
596,758
     $
8,484
       5.70 %
Home equity
    
326,970
      
6,302
       7.73 %    
309,270
      
5,962
       7.73 %
Commercial, financial, and agriculture
    
670,687
      
12,654
       7.57 %    
651,501
      
12,092
       7.44 %
Loans to depository institutions
    
59,670
      
798
       5.36 %    
-
      
-
      
-
  
Installment loans to individuals
    
46,206
      
1,319
       11.45 %    
48,880
      
1,400
       11.49 %
Previously securitized loans
    
11,210
      
1,856
       66.41 %    
24,045
      
2,513
       41.92 %
Total loans
    
1,710,989
      
31,946
       7.49 %    
1,630,454
      
30,451
       7.49 %
Securities:
                                                
Taxable
    
499,861
      
6,752
       5.42 %    
579,058
      
7,489
       5.19 %
Tax-exempt
    
40,160
      
658
       6.57 %    
43,388
      
700
       6.47 %
Total securities
    
540,021
      
7,410
       5.50 %    
622,446
      
8,189
       5.28 %
Loans held for Sale
    
-
      
-
      
-
      
6,400
      
200
       12.53 %
Deposits in depository institutions
    
10,227
      
114
       4.47 %    
33,986
      
416
       4.91 %
Federal funds sold
    
22,077
      
291
       5.29 %    
-
      
-
      
-
  
Total interest-earning assets
    
2,283,314
      
39,761
       6.98 %    
2,293,286
      
39,256
       6.87 %
Cash and due from banks
    
50,715
                      
50,217
                  
Bank premises and equipment
    
47,304
                      
42,621
                  
Other assets
    
169,860
                      
170,273
                  
Less:  Allowance for loan losses
     (16,135 )                     (16,911 )                
       Total assets
   $
2,535,058
                     $
2,539,486
                  
                                                 
Liabilities:
                                                
Interest-bearing demand deposits
    
428,772
      
1,310
       1.23 %    
438,851
      
1,329
       1.21 %
Savings deposits
    
344,204
      
1,429
       1.67 %    
318,702
      
926
       1.17 %
Time deposits
    
922,978
      
10,338
       4.49 %    
865,554
      
8,265
       3.83 %
Short-term borrowings
    
162,115
      
1,693
       4.19 %    
161,082
      
1,326
       3.30 %
Long-term debt
    
21,915
      
425
       7.78 %    
92,267
      
1,239
       5.39 %
   Total interest-bearing liabilities
    
1,879,984
      
15,195
       3.24 %    
1,876,456
      
13,085
       2.80 %
Noninterest-bearing demand deposits
    
318,041
                      
342,115
                  
Other liabilities
    
30,109
                      
28,526
                  
Stockholders' equity
    
306,924
                      
292,389
                  
Total liabilities and
                                                
stockholders' equity
   $
2,535,058
                     $
2,539,486
                  
Net interest income
           $
24,566
                     $
26,171
          
Net yield on earning assets
                     4.32 %                     4.58 %
                                                 
 
 
-18-
                   
Consolidated Average Balance Sheets, Yields, and Rates
              
(Unaudited) ($ in 000s)
                                    
                                     
   
Six Months Ended June 30,
  
         
2007
                
2006
        
   
Average
          
Yield/
    
Average
          
Yield/
  
   
Balance
    
Interest
    
Rate
    
Balance
    
Interest
    
Rate
  
                                     
Assets:
                                    
Loan portfolio:
                                    
Residential real estate
   $
595,381
     $
17,871
       6.05 %   $
594,954
     $
16,864
       5.72 %
Home equity
    
324,820
      
12,544
       7.79 %    
305,787
      
11,556
       7.62 %
Commercial, financial, and agriculture
    
668,888
      
25,343
       7.64 %    
643,420
      
23,385
       7.33 %
Loans to depository institutions
    
54,586
      
1,452
       5.36 %    
-
      
-
      
-
  
Installment loans to individuals
    
44,564
      
2,588
       11.71 %    
52,691
      
2,993
       11.45 %
Previously securitized loans
    
12,784
      
3,612
       56.98 %    
26,037
      
5,217
       40.41 %
Total loans
    
1,701,023
      
63,410
       7.52 %    
1,622,889
      
60,015
       7.46 %
Securities:
                                                
Taxable
    
502,707
      
13,686
       5.49 %    
576,640
      
14,748
       5.16 %
Tax-exempt
    
40,286
      
1,315
       6.58 %    
43,843
      
1,418
       6.52 %
Total securities
    
542,993
      
15,001
       5.57 %    
620,483
      
16,166
       5.25 %
Loans held for sale
    
-
      
-
      
-
      
3,218
      
200
       12.53 %
Deposits in depository institutions
    
11,623
      
230
       3.99 %    
24,490
      
566
       4.66 %
Federal funds sold
    
20,812
      
547
       5.30 %    
-
      
-
      
-
  
Total interest-earning assets
    
2,276,451
      
79,188
       7.01 %    
2,271,080
      
76,947
       6.83 %
Cash and due from banks
    
50,424
                      
51,726
                  
Bank premises and equipment
    
46,142
                      
42,575
                  
Other assets
    
169,455
                      
169,162
                  
Less:  Allowance for loan losses
     (15,887 )                     (16,881 )                
       Total assets
   $
2,526,585
                     $
2,517,662
                  
                                                 
Liabilities:
                                                
Interest-bearing demand deposits
    
429,483
      
2,641
       1.24 %    
441,474
      
2,588
       1.18 %
Savings deposits
    
337,153
      
2,736
       1.64 %    
312,542
      
1,658
       1.07 %
Time deposits
    
922,460
      
20,412
       4.46 %    
848,306
      
15,474
       3.68 %
Short-term borrowings
    
154,328
      
3,206
       4.19 %    
156,431
      
2,452
       3.16 %
Long-term debt
    
27,145
      
957
       7.11 %    
93,773
      
2,499
       5.37 %
   Total interest-bearing liabilities
    
1,870,569
      
29,952
       3.23 %    
1,852,526
      
24,671
       2.69 %
Noninterest-bearing demand deposits
    
317,382
                      
342,298
                  
Other liabilities
    
30,670
                      
28,544
                  
Stockholders' equity
    
307,964
                      
294,294
                  
Total liabilities and
                                                
stockholders' equity
   $
2,526,585
                     $
2,517,662
                  
Net interest income
           $
49,236
                     $
52,276
          
Net yield on earning assets
                     4.36 %                     4.64 %
 
 
-19-
 
                             
Analysis of Risk-Based Capital
                              
(Unaudited) ($ in 000s)
                              
                               
   
June 30
    
March 31
    
Dec 31
    
Sept 30
    
June 30
  
   
2007 (a)
    
2007
    
2006
    
2006
    
2006
  
                               
Tier I Capital:
                              
Stockholders' equity
   $
294,783
     $
303,354
     $
305,307
     $
298,327
     $
284,120
  
Goodwill and other intangibles
     (58,504 )     (58,681 )     (58,857 )     (59,038 )     (59,219 )
Accumulated other comprehensive income
    
8,647
      
4,684
      
2,859
      
4,109
      
9,762
  
Qualifying trust preferred stock
    
16,000
      
16,000
      
16,000
      
22,000
      
25,500
  
Excess deferred tax assets
     (332 )     (2,983 )    
-
      
-
       (4,079 )
Total tier I capital
   $
260,594
     $
262,374
     $
265,309
     $
265,398
     $
256,084
  
 
                                        
                                         
Total Risk-Based Capital:
                                        
Tier I capital
   $
260,594
     $
262,374
     $
265,309
     $
265,398
     $
256,084
  
Qualifying allowance for loan losses
    
16,616
      
16,082
      
15,405
      
15,557
      
15,268
  
Total risk-based capital
   $
277,210
     $
278,456
     $
280,714
     $
280,955
     $
271,352
  
                                         
Net risk-weighted assets
   $
1,719,589
     $
1,712,680
     $
1,734,214
     $
1,770,458
     $
1,757,720
  
 
                                        
                                         
Ratios:
                                        
Average stockholders' equity to average assets
     12.11 %     12.27 %     12.14 %     11.67 %     11.51 %
Tangible capital ratio
     9.58 %     9.79 %     10.06 %     9.69 %     9.13 %
Risk-based capital ratios:
                                        
Tier I capital
     15.15 %     15.32 %     15.30 %     14.99 %     14.57 %
Total risk-based capital
     16.12 %     16.26 %     16.19 %     15.87 %     15.44 %
Leverage capital
     10.52 %     10.68 %     10.79 %     10.81 %     10.34 %
                                         
(a) June 30, 2007 risk-based capital ratios are estimated
                                  
 
                                        
                                         
CITY HOLDING COMPANY AND SUBSIDIARIES
                                        
Intangibles
                                        
(Unaudited) ($ in 000s)
                                        
                                         
   
As of and for the Quarter Ended
  
   
June 30
    
March 31
    
Dec 31
    
Sept 30
    
June 30
  
   
2007
    
2007
    
2006
    
2006
    
2006
  
                                         
Intangibles, net
   $
58,504
     $
58,681
     $
58,857
     $
59,038
     $
59,219
  
Intangibles amortization expense
    
177
      
176
      
181
      
181
      
181
  
 
                                        
 
 
-20-
 
                             
Summary of Loan Loss Experience
                              
(Unaudited) ($ in 000s)
                              
                               
   
Quarter Ended
  
   
June 30
    
March 31
    
Dec. 31
    
Sept. 30
    
June 30
  
   
2007
    
2007
    
2006
    
2006
    
2006
  
                               
Balance at beginning of period
   $
16,083
     $
15,405
     $
15,557
     $
15,268
     $
16,818
  
                                         
Reduction of allowance for loans sold
    
-
      
-
      
-
      
-
       (1,368 )
                                         
Charge-offs:
                                        
Commercial, financial, and agricultural
    
120
      
35
      
844
      
207
      
43
  
Real estate-mortgage
    
452
      
111
      
230
      
177
      
232
  
Installment loans to individuals
    
60
      
84
      
126
      
165
      
239
  
Overdraft deposit accounts
    
956
      
860
      
892
      
1,018
      
955
  
Total charge-offs
    
1,588
      
1,090
      
2,092
      
1,567
      
1,469
  
                                         
Recoveries:
                                        
Commercial, financial, and agricultural
    
41
      
148
      
101
      
44
      
33
  
Real estate-mortgage
    
15
      
15
      
350
      
64
      
56
  
Installment loans to individuals
    
98
      
132
      
118
      
131
      
151
  
Overdraft deposit accounts
    
367
      
573
      
470
      
392
      
372
  
Total recoveries
    
521
      
868
      
1,039
      
631
      
612
  
                                         
Net charge-offs
    
1,067
      
222
      
1,053
      
936
      
857
  
Provision for loan losses
    
1,600
      
900
      
901
      
1,225
      
675
  
Balance at end of period
   $
16,616
     $
16,083
     $
15,405
     $
15,557
     $
15,268
  
                                         
Loans outstanding
   $
1,730,354
     $
1,691,748
     $
1,677,469
     $
1,697,201
     $
1,647,539
  
Average loans outstanding
    
1,710,989
      
1,690,946
      
1,689,846
      
1,662,929
      
1,630,454
  
Allowance as a percent of loans outstanding
     0.96 %     0.95 %     0.92 %     0.92 %     0.93 %
Allowance as a percent of non-performing loans
     145.11 %     235.75 %     384.93 %     408.43 %     408.02 %
Net charge-offs (annualized) as a percentage of
                                        
average loans outstanding
     0.25 %     0.05 %     0.25 %     0.23 %     0.21 %
Net charge-offs, excluding overdraft deposit accounts,
                                       
(annualized) as a percent of average loans outstanding
     0.11 %     (0.02 )%     0.15 %     0.07 %     0.07 %
 
 
-21-
 
                             
Summary of Non-Performing Assets
                              
(Unaudited) ($ in 000s)
                              
                               
   
June 30
    
March 31
    
Dec 31
    
Sept 30
    
June 30
  
   
2007
    
2007
    
2006
    
2006
    
2006
  
                               
Nonaccrual loans
   $
11,194
     $
6,714
     $
3,319
     $
3,359
     $
3,046
  
Accruing loans past due 90 days or more
    
212
      
108
      
635
      
328
      
573
  
Previously securitized loans past due 90 days or more
    
45
      
-
      
48
      
122
      
123
  
Total non-performing loans
    
11,451
      
6,822
      
4,002
      
3,809
      
3,742
  
Other real estate owned, excluding property associated
                                        
with previously securitized loans
    
624
      
290
      
161
      
499
      
294
  
Other real estate owned associated with previously
                                        
securitized loans
    
231
      
252
      
20
      
20
      
92
  
Other real estate owned
    
855
      
542
      
181
      
519
      
386
  
Total non-performing assets
   $
12,306
     $
7,364
     $
4,183
     $
4,328
     $
4,128
  
                                         
Non-performing assets as a percent of loans and
                                        
other real estate owned
     0.71 %     0.44 %     0.25 %     0.25 %     0.25 %
 
                                        
                                         
                                         
CITY HOLDING COMPANY AND SUBSIDIARIES
                                        
Summary of Total Past Due Loans
                                        
(Unaudited) ($ in 000s)
                                        
                                         
   
June 30
    
March 31
    
Dec 31
    
Sept 30
    
June 30
  
   
2007
    
2007
    
2006
    
2006
    
2006
  
                                         
Residential real estate
   $
3,354
     $
2,372
     $
4,534
     $
4,072
     $
4,268
  
Home equity
    
879
      
999
      
1,083
      
1,412
      
943
  
Commercial, financial, and agriculture
    
2,248
      
1,185
      
2,082
      
1,970
      
620
  
Loans to depository institutions
    
-
      
-
      
-
      
-
      
-
  
Installment loans to individuals
    
370
      
283
      
389
      
495
      
559
  
Previously securitized loans
    
799
      
596
      
1,110
      
949
      
989
  
Overdraft deposit accounts
    
692
      
500
      
652
      
548
      
537
  
Total past due loans
   $
8,342
     $
5,935
     $
9,850
     $
9,446
     $
7,916
  
 
                                        
 
 
 
 
 
-22-