EX-99.1 2 ex99-1.htm PRESS RELEASE, CHCO 4TH QUARTER 2008 EARNINGS ex99-1.htm

Exhibit 99.1


NEWS RELEASE

For Immediate Release
January 27, 2009

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

City Holding Company Announces 2008 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 of $4.2 million or $0.26 per diluted share for the fourth quarter of 2008 and $28.1 million or $1.74 per diluted share for the full year.  Charles Hageboeck, Chief Executive Officer and President stated “Against the backdrop of one of the most significant economic downturns in decades, City’s underlying fundamentals are solid. Excluding short-term loans to other banks, loans grew 6.2% during the year ended December 31, 2008. Average checking and saving deposits for the year were up 1.9% in 2008 as compared to 2007. The net interest margin for 2008 averaged 4.64%, up from 4.34% for 2007, and was 4.73% during the fourth quarter of 2008.  Branch Service Charges increased 3.6%, trust and investment management fees increased 9.7%, and insurance revenues increased 3.0% in 2008. City’s non-interest expenses increased 3.6% after considering the impact of the expenses associated with the early redemption of our 9.15% trust preferred securities and a special program to establish funds in City’s name in community foundations in many of City’s primary markets. City’s tangible common equity ratio is 8.8% which is strong compared to other banks of City’s size. The strength of our capital position provided us the option not to participate in the government assistance made available to banks in the fourth quarter of 2008 (the “Trouble Asset Relief Program”). With strong core earnings, strong capital, and with a low ratio of loans to deposits in comparison to our peer group (bank holding companies with total assets between $1 and $5 billion), City expects to be able to continue to lend within its communities and to continue to grow its franchise.


“Despite the challenges that are facing City, our industry, and indeed our entire nation, City remains strong, operating in some of the most stable markets in the U.S. For example, West Virginia’s unemployment rate in November 2008 was 4.6% as compared to the U.S. unemployment rate of 6.8% for the same period. The rate of foreclosures on residential mortgages in West Virginia has been reported to be one of the lowest in the U.S. and home prices are generally believed to have remained relatively stable through the last 18 months as prices in many markets have fallen precipitously.

 
 
 

“The economic recession being experienced throughout the U.S. and the world has also been felt at City Holding Company and City National Bank. During the third quarter of 2008, we experienced a significant loss on investments in Fannie Mae and Freddie Mac, two of our nation’s largest Companies, which were placed into conservatorship by our government.  As the recession has deepened during the fourth quarter of 2008, City’s investments in pools of debt issued by banks throughout the U.S. also deteriorated in value on fears that some of the banks that have issued debt into these pools will not survive.  As a result, we took charges of $10.8 million in the fourth quarter and $38.3 million during the year for other than temporary impairments of investments, including our investment in preferred stock in Fannie Mae and Freddie Mac.  We have experienced some increase in losses on loans, although not to the extent experienced in most other markets throughout the U.S. As a result, our provision for loan losses was $5.3 million for the fourth quarter of 2008 and $10.4 million for the year.  Despite these setbacks, City still achieved a return on assets of 1.12% for the full year of 2008 – better than most in our peer group (bank holding companies with total assets between $1 and $5 billion).

“As the economic recession, and the political response to it continues to unfold, it is possible that City, as well as our entire industry, will continue to experience higher than normal losses within our loan portfolio. We may also experience further deterioration of investments made by City in debt or preferred stock of some of our competitors. Regulatory changes that may accompany a new regime in Washington may have adverse consequences for all banks. However, we believe that City’s strong earnings, capital and liquidity will allow City to outperform our industry. Many of our peers are reducing, or in some cases eliminating, their dividends. City’s dividend has increased by approximately 10% or more each of the last five years. We are proud of the results that we have achieved for our shareholders.  Our Board will determine in March 2009 whether to increase our dividend above the current $0.34 rate based upon our estimates of both the U.S. economy, and our own financial condition, at that time.”

Net Interest Income

The Company’s tax equivalent net interest income increased $4.6 million, or 4.7%, from $97.9 million in 2007 to $102.6 million in 2008, as interest expense on deposits and other interest bearing liabilities decreased more quickly than interest income from loans and investments. The Company’s reported net interest margin expanded to 4.64% for the year ended December 31, 2008 as compared to 4.34% for the year ended December 31, 2007.

The Company benefited from a portfolio of interest rate floors with a total notional value of $500 million which minimized the impact of falling rates on the Company’s interest income from variable rate loans during 2008. During the fourth quarter of 2008, an interest rate floor with a notional value of $50 million matured and the Company sold the remaining interest rate floors with notional amounts totaling $350 million.  The gain of $12.5 million from the sale of these interest rate floors will be recognized over the remaining lives of the various hedged loans.  Partially offsetting the reduction in interest expense from falling market rates was a decrease of $1.6 million in interest income from Previously Securitized Loans from the year ended December 31, 2007 as the average balances of these loans have decreased 50.6%.  The decrease in average balances of Previously Securitized Loans was partially mitigated by an increase in the yield on these loans from 69.1% for the year ended December 31, 2007 to 108.1% for the year ended December 31, 2008.

 
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The Company’s tax equivalent net interest income increased $2.0 million, or 8.3%, from $24.3 million during the fourth quarter of 2007 to $26.3 million during the fourth quarter of 2008, as  interest expense on deposits and other interest bearing liabilities decreased more quickly than interest income from loans and investments.  As previously discussed, the Company’s interest rate floors diminished the impact of falling rates on the Company’s interest income from variable rate loans.

Credit Quality

At December 31, 2008, the Allowance for Loan Losses (“ALLL”) was $22.3 million or 1.23% of total loans outstanding and 86% of non-performing loans compared to $17.6 million or 1.00% of loans outstanding and 103% of non-performing loans at December 31, 2007, and $18.9 million or 1.06% of loans outstanding and 136% of non-performing loans at September 30, 2008.

As a result of the Company’s quarterly analysis of the adequacy of the ALLL, the Company recorded a provision for loan losses of $5.3 million in the fourth quarter of 2008 and $10.4 million for the year ended December 31, 2008 compared to $1.7 million and $5.4 million for the comparable periods in 2007.  The provision for loan losses recorded during 2008 reflects difficulties encountered by certain commercial borrowers of the Company during the year, the downgrade of their related credits and management’s assessment of the impact of these difficulties on the ultimate collectability of the loans. Additionally, the provision reflects changes in the economic conditions in the Company’s geographic market and the United States in general and an increase in the balance of commercial loans during the year.  Changes in the amount of the provision and related allowance are based on the Company’s detailed systematic methodology and are directionally consistent with changes in the composition and quality of the Company’s loan portfolio. 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.

The Company’s ratio of non-performing assets to total loans and other real estate owned increased from 1.20% at December 31, 2007 to 1.64% at December 31, 2008.  This increase is attributable primarily to the difficulties encountered by certain commercial customers during 2008 and their related borrowings have been classified as substandard.

 Approximately 48% of the Company’s nonperforming loans at December 31, 2008, or approximately $12 million, were associated with a $17 million portfolio of loans to builders of speculative homes at the Greenbrier Resort in White Sulphur Springs, West Virginia. Through December 31, 2008, the Company has specifically reserved $3.6 million of the allowance for loan losses (ALLL) associated with this portfolio of speculative properties. The Greenbrier Resort has a long history and tradition as a top resort destination and is owned by CSX Corporation. However, the current economic scenario has been challenging for the Greenbrier, which lost $35 million in 2008 according to CSX Corporation. Additionally, the CSX Corporation has reported hiring Goldman Sachs to apprise them of their strategic options regarding the Greenbrier. The Company has considered the uncertainty of the situation at the

 
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Greenbrier arising in the fourth quarter, and has increased the provision for loan losses relative to this portfolio of speculative builders by $1.15 million.  Based on our analysis, the Company believes that the allowance allocated to the nonperforming and substandard loans, after considering the value of the collateral securing such loans, is adequate to cover losses that may result from these loans at December 31, 2008.  While the Company’s non-performing assets have increased, our ratio of non-performing assets to total loans and other real estate owned is 136 basis points lower than 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 3.00% for the most recently reported quarter ended September 30, 2008. The Company’s non-performing assets are disproportionately tied to two sub-sectors within the loan portfolio.

In addition to the 48% of the Company’s non-performing loans associated with speculative builders at the Greenbrier, slightly more than 25% of the Company’s non-performing assets are associated with real estate in what is known as the “Eastern Panhandle” of West Virginia – the counties of Jefferson, Berkeley, and Morgan. These three counties are all considered distant suburbs of the Washington D.C. MSA and have experienced explosive growth in the last 10 years. While this is a relatively small part of the Company’s entire franchise, the downturn that has gripped the nation’s mortgage and construction industry has had disproportionately more impact upon the Company’s asset quality and provision in this region than in the remainder of the Company.  Exclusive of loans to speculative builders at the Greenbrier or loans in the Eastern Panhandle, other loans throughout the Company account for only 27% of the Company’s non-performing loans.

The Company had net charge-offs of $2.0 million in the fourth quarter of 2008.  Net charge-offs on commercial and residential loans were $1.1 million and $0.5 million, respectively, for the fourth quarter, while installment loans experienced no net charge-offs during the quarter.  The increase in charge-offs on commercial loans was primarily related to one credit that had been appropriately considered in establishing the allowance for loan losses in prior periods.  In addition, net charge-offs for depository accounts were $0.4 million for the fourth quarter of 2008 and $1.4 million for the year ended December 31, 2008.  While charge-offs on depository accounts are appropriately taken against the ALLL, the revenue associated with depository accounts is reflected in service charges.  Charge-offs for the full year 2008 totaled $5.75 million.  Of these, $1.2 million are associated with speculative loans at the Greenbrier and $1.2 million are associated with loans in the Eastern Panhandle of West Virginia.

 Impairment Losses

During 2008, the Company recorded $38.3 million of investment impairment losses, including $10.8 million in the fourth quarter.  The charges deemed to be other than temporary were related to agency preferreds ($21.1 million impairment taken in the third quarter) with remaining book value of $1.6 million at December 31, 2008; pooled bank trust preferreds (a $9.9 million impairment in the fourth quarter and a $14.2 million impairment for the full year) with remaining book value of $10.9 million at December 31, 2008; income notes (a $0.9 million impairment in the fourth quarter and $2.0 million for the full year) with no remaining book value at December 31, 2008; and corporate debt securities (a $1.0 million impairment taken

 
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in the third quarter) with remaining book value of $24.6 million at December 31, 2008.  The impairment charges for the agency preferred securities were due to the actions of the federal government to place Freddie Mac and Fannie Mae into conservatorship and the suspension of dividends on such preferred securities.  The impairment charges related to the pooled bank trust preferred securities and income notes were based on the Company’s quarterly reviews of its investment securities for indications of losses considered to be other than temporary.  Based on management’s assessment of the securities the Company owns, the seniority position of the securities within the pools, the level of defaults and deferred payments within the pools, and a review of the financial strength of the banks within the respective pools, management concluded that impairment charges of $15.5 million and $2.0 million on the pooled bank trust preferred securities and the income notes, respectively, were necessary for the year ended December 31, 2008.  The $1.0 million impairment charge for corporate debt securities was due to Lehman Brothers Holdings bankruptcy filing.  The Company had acquired this security as the result of an acquisition of a bank in 2005.

Visa Gain

In addition, the Company recognized a $3.3 million gain in connection with Visa’s successful initial public offering (“IPO”) completed in March 2008.  The Company received approximately $2.3 million on the partial redemption of its equity interest in Visa.  The Company’s remaining Class B shares will be converted to Class A shares on the third anniversary of Visa’s IPO or upon Visa’s settlement of certain litigation matters, whichever is later.  The unconverted Class B shares are not reflected in the Company’s balance sheet at December 31, 2008 as the Company has no historical basis in these shares.  Visa also escrowed a portion of the proceeds from the IPO to satisfy approximately $1.0 million of liabilities that represented the Company’s proportionate share of legal judgments and settlements related to Visa litigation with American Express and Discover Financial Services.

Non-interest Expenses

During 2008, the Company fully redeemed $16.0 million of 9.15% trust preferred securities that had been issued in 1998.  As a result of this redemption, the Company incurred charges of $1.2 million to fully amortize issuance costs incurred in 1998 and for the early redemption premium.  Excluding the loss on the early redemption of the trust preferred securities, non-interest expenses increased $3.5 million from $71.0 million in 2007 to $74.5 million in 2008.  Salaries and employee benefits increased $1.2 million, or 3.3%, from $36.0 million in 2007 to $37.2 million in 2008 due in part to additional staffing for new retail locations.  Other expenses also include increased charitable contributions of $0.75 million during 2008.

Non-interest expenses decreased $0.1 million from $17.9 million in the fourth quarter of 2007 to $17.8 million in the fourth quarter of 2008.  Other expenses decreased $1.1 million from 2007 as a charge related to the Company’s proportionate share of certain losses incurred by Visa U.S.A. Inc. (see Visa U.S.A. Inc.) was recorded in the fourth quarter of 2007.  This decrease was partially offset by increases in advertising of $0.2 million, occupancy and equipment of $0.2 million, and repossessed asset losses of $0.2 million.


 
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Income Tax Expense

The Company’s effective income tax rate for the quarter and year ended December 31, 2008 was 31.0% and 25.2% compared to 32.2% and 33.6% for the year ended December 31, 2007, respectively.  The lower effective tax rate is largely attributable to the reduction in pre-tax income from the higher loan loss provision and other than temporary impairment losses on investments without a corresponding decrease in income from tax-exempt sources.


City Holding Company is the parent company of City National Bank of West Virginia.  City National operates 69 branches across West Virginia, Eastern Kentucky and Southern 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 on previously securitized loans that would result in impairment losses or lower the yield on such loans; (4) the Company may not 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 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; (12) the Company may experience difficulties growing loan and deposit balances; (13) the current economic environment poses significant challenges for us and could adversely affect our  financial condition and results of operations; (14) continued deterioration in the financial condition of the U.S. banking system may impact the valuations of investments the Company has made in the securities of other financial institutions resulting in either actual losses or other than temporary impairments on such investments; and (15) the United States government’s plan to purchase large amounts of illiquid, mortgage-backed and other securities from financial institutions may not be effective and/or it may not be available to us.  Forward-looking statements made herein reflect management's expectations as of the date such

 
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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 December 31,
    
Percent
  
   
2008
    
2007
    
Change
  
                   
Earnings ($000s, except per share data):
                  
Net Interest Income (FTE)
   $ 26,280     $ 24,264       8.31 %
Net Income
     4,249       12,758       (66.70 )%
Earnings per Basic Share
     0.26       0.78       (66.67 )%
Earnings per Diluted Share
     0.26       0.78       (66.67 )%
                         
                         
Key Ratios (percent):
                        
Return on Average Assets
     0.68 %     2.05 %     (66.98 )%
Return on Average Tangible Equity
     7.32 %     21.56 %     (66.06 )%
Net Interest Margin
     4.73 %     4.32 %     9.68 %
Efficiency Ratio
     44.04 %     46.15 %     (4.56 )%
Average Shareholders' Equity to Average Assets
     11.53 %     11.84 %     (2.62 )%
                         
Consolidated Risk Based Capital Ratios (a):
                        
Tier I
     11.85 %     14.12 %     (16.08 )%
Total
     13.04 %     15.11 %     (13.70 )%
                         
Tangible Equity to Tangible Assets
     8.83 %     9.72 %     (9.19 )%
                         
                         
Common Stock Data:
                        
Cash Dividends Declared per Share
   $ 0.34     $ 0.31       9.68 %
Book Value per Share
     17.58       18.14       (3.08 )%
Tangible Book Value per Share
     13.98       14.55       (3.91 )%
Market Value per Share:
                        
High
     42.88       39.15       9.53 %
Low
     29.08       33.41       (12.96 )%
End of Period
     36.42       33.84       7.62 %
                         
   
Twelve Months Ended December 31,
    
Percent
  
   
2008
    
2007
    
Change
  
                         
Earnings ($000s, except per share data):
                        
Net Interest Income (FTE)
   $ 102,575     $ 97,949       4.72 %
Net Income
     28,109       51,026       (44.91 )%
Earnings per Basic Share
     1.74       3.02       (42.38 )%
Earnings per Diluted Share
     1.74       3.01       (42.19 )%
                         
                         
Key Ratios (percent):
                        
Return on Average Assets
     1.12 %     2.03 %     (44.70 )%
Return on Average Tangible Equity
     11.44 %     20.99 %     (45.48 )%
Net Interest Margin
     4.64 %     4.34 %     6.96 %
Efficiency Ratio
     46.33 %     45.91 %     0.91 %
Average Shareholders' Equity to Average Assets
     12.12 %     12.01 %     0.90 %
                         
                         
Common Stock Data:
                        
Cash Dividends Declared per Share
   $ 1.36     $ 1.24       9.68 %
Market Value per Share:
                        
High
     47.28       41.54       13.82 %
Low
     29.08       31.16       (6.68 )%
                         
Price/Earnings Ratio (b)
     20.93       11.21       86.80 %
                         
(a) December 31, 2008 risk-based capital ratios are estimated
                  
(b) December 31, 2008 price/earnings ratio computed based on 2008 earnings
                  
 
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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
  
                                     
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       17.68       18.14       31.16       41.54  
2008
     18.92       18.72       17.61       17.58       29.08       42.88  
                                                 
                                                 
Earnings per Basic Share
                                          
                                                 
   
Quarter Ended
          
   
March 31
    
June 30
    
September 30
    
December 31
    
Year-to-Date
          
                                                 
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       0.76       0.78       3.02          
2008
     0.81       0.83       (0.16 )     0.26       1.74          
                                                 
                                                 
Earnings per Diluted Share
                                          
                                                 
   
Quarter Ended
          
   
March 31
    
June 30
    
September 30
    
December 31
    
Year-to-Date
          
                                                 
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       0.76       0.78       3.01          
2008
     0.80       0.83       (0.16 )     0.26       1.74          
                                                 
 
 
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Consolidated Statements of Income
            
(Unaudited) ($ in 000s, except per share data)
            
             
   
Three Months Ended December 31,
  
   
2008
    
2007
  
             
Interest Income
            
Interest and fees on loans
   $ 30,465     $ 32,477  
Interest on investment securities:
                
Taxable
     5,818       5,968  
Tax-exempt
     372       420  
Interest on deposits in depository institutions
     8       119  
Interest on federal funds sold
     -       5  
Total Interest Income
     36,663       38,989  
                 
Interest Expense
                
Interest on deposits
     9,926       12,847  
Interest on short-term borrowings
     343       1,677  
Interest on long-term debt
     313       426  
Total Interest Expense
     10,582       14,950  
Net Interest Income
     26,081       24,039  
Provision for loan losses
     5,340       1,650  
Net Interest Income After Provision for Loan Losses
     20,741       22,389  
                 
Non-Interest Income
                
Investment securities (losses) gains
     (10,800 )     1  
Service charges
     11,459       11,735  
Insurance commissions
     981       1,119  
Trust and investment management fee income
     518       514  
Bank owned life insurance
     739       600  
Other income
     284       312  
Total Non-Interest Income
     3,181       14,281  
                 
Non-Interest Expense
                
Salaries and employee benefits
     8,845       8,759  
Occupancy and equipment
     1,773       1,604  
Depreciation
     1,193       1,133  
Professional fees
     451       424  
Postage, delivery, and statement mailings
     641       601  
Advertising
     818       590  
Telecommunications
     562       456  
Bankcard expenses
     711       617  
Insurance and regulatory
     363       422  
Office supplies
     533       469  
Repossessed asset losses (gains), net of expenses
     87       (105 )
Other expenses
     1,789       2,891  
Total Non-Interest Expense
     17,766       17,861  
Income Before Income Taxes
     6,156       18,809  
Income tax expense
     1,907       6,051  
Net Income
   $ 4,249     $ 12,758  
                 
Basic earnings per share
   $ 0.26     $ 0.78  
Diluted earnings per share
   $ 0.26     $ 0.78  
Average Common Shares Outstanding:
                
Basic
     16,078       16,359  
Diluted
     16,100       16,414  
                 
 
 
10
 
           
Consolidated Statements of Income
            
(Unaudited) ($ in 000s, except per share data)
            
             
   
Twelve months ended December 31,
  
   
2008
    
2007
  
             
Interest Income
            
Interest and fees on loans
   $ 122,127     $ 128,609  
Interest on investment securities:
                
Taxable
     23,852       25,677  
Tax-exempt
     1,523       1,689  
Interest on deposits in depository institutions
     171       521  
Interest on federal funds sold
     -       819  
Total Interest Income
     147,673       157,315  
                 
Interest Expense
                
Interest on deposits
     41,906       51,826  
Interest on short-term borrowings
     2,629       6,642  
Interest on long-term debt
     1,383       1,808  
Total Interest Expense
     45,918       60,276  
Net Interest Income
     101,755       97,039  
Provision for loan losses
     10,423       5,350  
Net Interest Income After Provision for Loan Losses
     91,332       91,689  
                 
Non-Interest Income
                
Investment securities (losses) gains
     (38,265 )     45  
Service charges
     45,995       44,416  
Insurance commissions
     4,212       4,090  
Trust and investment management fee income
     2,239       2,042  
Bank owned life insurance
     2,932       2,477  
Gain on sale of credit card merchant agreements
     -       1,500  
VISA IPO Gain
     3,289       -  
Other income
     1,534       1,566  
Total Non-Interest Income
     21,936       56,136  
                 
Non-Interest Expense
                
Salaries and employee benefits
     37,263       36,034  
Occupancy and equipment
     6,871       6,366  
Depreciation
     4,523       4,472  
Professional fees
     1,680       1,628  
Postage, delivery, and statement mailings
     2,549       2,588  
Advertising
     2,899       3,123  
Telecommunications
     1,916       1,809  
Bankcard expenses
     2,689       2,354  
Insurance and regulatory
     1,388       1,555  
Office supplies
     2,021       1,838  
Repossessed asset losses (gains), net of expenses
     524       (157 )
Loss on early extinguishment of debt
     1,208       -  
Other expenses
     10,141       9,403  
Total Non-Interest Expense
     75,672       71,013  
Income Before Income Taxes
     37,596       76,812  
Income tax expense
     9,487       25,786  
Net Income
   $ 28,109     $ 51,026  
                 
Basic earnings per share
   $ 1.74     $ 3.02  
Diluted earnings per share
   $ 1.74     $ 3.01  
Average Common Shares Outstanding:
                
Basic
     16,118       16,877  
Diluted
     16,167       16,935  
                 
 
 
11
 
           
Consolidated Statements of Changes in Stockholders' Equity
            
(Unaudited) ($ in 000s)
            
             
             
   
Three Months Ended
  
   
December 31, 2008
    
December 31, 2007
  
             
Balance at October 1
   $ 284,912     $ 291,720  
                 
Net income
     4,249       12,758  
Other comprehensive income:
                
Change in unrealized gain on securities available-for-sale
     5,003       783  
Change in underfunded pension liability
     (2,284 )     696  
Change in unrealized gain on interest rate floors
     1,159       3,550  
Cash dividends declared ($0.34/share)
     (5,425 )     -  
Cash dividends declared ($0.31/share)
     -       (5,025 )
Issuance of stock award shares, net
     69       56  
Exercise of 200 stock options
     3       -  
Purchase of 232,100 common shares of treasury
     (7,257 )     -  
Purchase of 300,112 common shares of treasury
     -       (10,544 )
Balance at December 31
   $ 280,429     $ 293,994  
                 
                 
                 
   
Twelve Months Ended
  
   
December 31, 2008
    
December 31, 2007
  
                 
Balance at January 1
   $ 293,994     $ 305,307  
                 
  Cumulative effect of adopting FIN 48
     -       (125 )
Net income
     28,109       51,026  
Other comprehensive income:
                
Change in unrealized (loss) gain on securities available-for-sale
     (13,845 )     866  
Change in unrealized gain on interest rate floors
     4,897       4,600  
Change in underfunded pension liability
     (2,284 )     696  
Cash dividends declared ($1.36/share)
     (21,882 )     -  
Cash dividends declared ($1.24/share)
     -       (20,728 )
Issuance of stock award shares, net
     479       427  
Exercise of 66,454 stock options
     1,669       -  
Exercise of 7,300 stock options
     -       154  
Excess tax benefits on stock compensation
     266       3  
Purchase of 337,060 common shares of treasury
     (10,974 )     -  
Purchase of 1,314,112 common shares of treasury
     -       (48,232 )
Balance at December 31
   $ 280,429     $ 293,994  
                 
                 
                 
                 
 
 
12
 
                   
Condensed Consolidated Quarterly Statements of Income
              
(Unaudited) ($ in 000s, except per share data)
                    
                               
   
Quarter Ended
  
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec. 31
  
   
2008
    
2008
    
2008
    
2008
    
2007
  
                               
Interest income
   $ 36,663     $ 36,522     $ 36,968     $ 37,520     $ 38,989  
Taxable equivalent adjustment
     200       200       204       214       226  
Interest income (FTE)
     36,863       36,722       37,172       37,734       39,215  
Interest expense
     10,582       10,241       11,494       13,601       14,950  
Net interest income
     26,281       26,481       25,678       24,133       24,265  
Provision for loan losses
     5,340       2,350       850       1,883       1,650  
Net interest income after provision
                                        
for loan losses
     20,941       24,131       24,828       22,250       22,615  
                                         
Noninterest income
     3,181       (12,758 )     14,195       17,318       14,281  
Noninterest expense
     17,766       19,246       18,761       19,899       17,861  
Income (Loss) before income taxes
     6,356       (7,873 )     20,262       19,669       19,035  
Income tax expense (benefit)
     1,907       (5,516 )     6,679       6,417       6,051  
Taxable equivalent adjustment
     200       200       204       214       226  
Net income (loss)
   $ 4,249     $ (2,557 )   $ 13,379     $ 13,038     $ 12,758  
                                         
                                         
                                         
Basic earnings (loss) per share
   $ 0.26     $ (0.16 )   $ 0.83     $ 0.81     $ 0.78  
Diluted earnings (loss) per share
     0.26       (0.16 )     0.83       0.80       0.78  
Cash dividends declared per share
     0.34       0.34       0.34       0.34       0.31  
                                         
                                         
Average Common Share (000s):
                                        
Outstanding
     16,078       16,142       16,103       16,147       16,359  
Diluted
     16,100       16,195       16,167       16,205       16,414  
                                         
Net Interest Margin
     4.73 %     4.78 %     4.65 %     4.40 %     4.32 %
                                         
 
 
13
 
                             
Non-Interest Income and Non-Interest Expense
                              
(Unaudited) ($ in 000s)
                              
                               
   
Quarter Ended
  
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec. 31
  
   
2008
    
2008
    
2008
    
2008
    
2007
  
                               
Non-Interest Income:
                              
Service charges
   $ 11,459     $ 11,993     $ 11,269     $ 11,274     $ 11,735  
Insurance commissions
     981       1,025       1,168       1,038       1,119  
Trust and investment management fee income
     518       640       449       632       514  
Bank owned life insurance
     739       767       750       676       600  
Other income
     284       284       559       407       312  
Subtotal
     13,981       14,709       14,195       14,027       14,280  
Investment securities (losses) gains
     (10,800 )     (27,467 )     -       2       1  
VISA IPO Gain
     -       -       -       3,289       -  
Total Non-Interest Income
   $ 3,181     $ (12,758 )   $ 14,195     $ 17,318     $ 14,281  
                                         
Non-Interest Expense:
                                        
Salaries and employee benefits
   $ 8,845     $ 9,538     $ 9,517     $ 9,363     $ 8,759  
Occupancy and equipment
     1,773       1,800       1,701       1,597       1,604  
Depreciation
     1,193       1,110       1,087       1,133       1,133  
Professional fees
     451       435       427       367       424  
Postage, delivery, and statement mailings
     641       636       618       654       601  
Advertising
     818       821       643       617       590  
Telecommunications
     562       496       440       418       456  
Bankcard expenses
     711       717       640       621       617  
Insurance and regulatory
     363       354       333       338       422  
Office supplies
     533       527       504       457       469  
Repossessed asset losses (gains), net of expenses
     87       314       91       32       (105 )
Loss on early extinguishment of debt
     -       -       -       1,208       -  
Other expenses
     1,789       2,498       2,760       3,094       2,891  
Total Non-Interest Expense
   $ 17,766     $ 19,246     $ 18,761     $ 19,899     $ 17,861  
                                         
                                         
                                         
                                         
Employees (Full Time Equivalent)
     827       812       817       821       811  
Branch Locations
     69       69       68       69       69  
                                         
 
 
14
 
           
Consolidated Balance Sheets
            
($ in 000s)
            
   
December 31
    
December 31
  
   
2008
    
2007
  
   
(Unaudited)
        
Assets
            
Cash and due from banks
   $ 55,511     $ 64,726  
Interest-bearing deposits in depository institutions
     4,118       9,792  
Cash and cash equivalents
     59,629       74,518  
                 
Investment securities available-for-sale, at fair value
     424,214       382,098  
Investment securities held-to-maturity, at amortized cost
     29,067       34,918  
Total investment securities
     453,281       417,016  
                 
Gross loans
     1,812,344       1,767,021  
Allowance for loan losses
     (22,254 )     (17,581 )
Net loans
     1,790,090       1,749,440  
                 
Bank owned life insurance
     70,400       64,467  
Premises and equipment
     60,138       54,635  
Accrued interest receivable
     9,024       11,254  
Net deferred tax assets
     48,462       20,633  
Intangible assets
     57,479       58,238  
Other assets
     33,943       32,566  
Total Assets
   $ 2,582,446     $ 2,482,767  
                 
Liabilities
                
Deposits:
                
Noninterest-bearing
   $ 298,530     $ 314,231  
Interest-bearing:
                
Demand deposits
     420,554       397,510  
Savings deposits
     354,956       350,607  
Time deposits
     967,090       927,733  
Total deposits
     2,041,130       1,990,081  
Short-term borrowings
     194,463       161,916  
Long-term debt
     19,047       4,973  
Other liabilities
     47,377       31,803  
Total Liabilities
     2,302,017       2,188,773  
                 
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 December 31, 2008 and December 31, 2007
                
    less 2,548,538 and 2,292,357 shares in treasury, respectively
     46,249       46,249  
Capital surplus
     102,895       103,390  
Retained earnings
     230,613       224,386  
Cost of common stock in treasury
     (88,729 )     (80,664 )
Accumulated other comprehensive (loss) income:
                
Unrealized loss on securities available-for-sale
     (15,628 )     (1,783 )
Unrealized gain on derivative instruments
     9,287       4,390  
Underfunded pension liability
     (4,258 )     (1,974 )
Total Accumulated Other Comprehensive (Loss) Income
     (10,599 )     633  
Total Stockholders' Equity
     280,429       293,994  
Total Liabilities and Stockholders' Equity
   $ 2,582,446     $ 2,482,767  
                 
 
 
15
 
CITY HOLDING COMPANY AND SUBSIDIARIES
                    
Investment Portfolio
                        
(Unaudited) ($ in 000s)
                        
                         
   
Original Cost
    
Other Than Temporary Impairment Charges thru 12/31/08
    
Unrealized Gains (Losses)
    
Carrying Value
  
                         
FNMA & FHLMC Preferred Stock
   $ 22,680     $ (21,089 )   $ (1,115 )   $ 475  
Mortgage Backed Securities
     284,647       -       3,686       288,333  
Municipal Bonds
     44,794       -       (539 )     44,255  
Pooled Bank Trust Preferreds
     29,692       (16,180 )     (10,098 )     3,414  
Single Issuer Bank Trust Preferreds,
                                
Subdebt of Financial Institutions, and Bank Holding Company Preferred Stocks
     112,723       (1,000 )     (15,269 )     96,454  
Money Markets and Mutual Funds
     1,859       -       (35 )     1,824  
Federal Reserve Bank and FHLB stock
     13,037       -       -       13,037  
Community Bank Equity Positions
     7,887       -       (2,398 )     5,489  
Total Investments
   $ 517,319     $ (38,270 )   $ (25,768 )   $ 453,281  
                                 
 
 
16
 
CITY HOLDING COMPANY AND SUBSIDIARIES
                    
Loan Portfolio
                              
(Unaudited) ($ in 000s)
                              
                               
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec 31
  
   
2008
    
2008
    
2008
    
2008
    
2007
  
                               
Residential real estate
   $ 611,962     $ 620,951     $ 612,676     $ 605,579     $ 602,057  
Home equity
     384,320       377,919       371,537       347,986       341,818  
Commercial, financial, and agriculture
     768,255       729,613       715,196       699,653       707,987  
Loans to depository institutions
     -       -       -       -       60,000  
Installment loans to individuals
     43,585       44,728       45,385       45,557       48,267  
Previously securitized loans
     4,222       4,520       5,253       6,025       6,892  
Gross Loans
   $ 1,812,344     $ 1,777,731     $ 1,750,047     $ 1,704,800     $ 1,767,021  
                                         
                                         
                                         
                                         
                                         
                                         
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)
          
                                         
   
2007
     $ 6.9     $ 7.3       69 %        
   
2008
       4.2       5.6       108 %        
   
2009
       3.7       4.1       108 %        
   
2010
       3.1       3.4       108 %        
   
2011
       2.6       2.9       108 %        
 
a - 2007 and 2008 amounts are based on actual results.  2009, 2010, and 2011 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 December 31,
  
         
2008
                
2007
        
   
Average
          
Yield/
    
Average
          
Yield/
  
   
Balance
    
Interest
    
Rate
    
Balance
    
Interest
    
Rate
  
                                     
Assets:
                                    
Loan portfolio:
                                    
Residential real estate
   $ 616,944     $ 9,308       6.00 %   $ 599,087     $ 9,429       6.24 %
Home equity
     379,884       6,746       7.06 %     339,783       6,432       7.51 %
Commercial, financial, and agriculture
     737,454       11,882       6.41 %     685,292       12,652       7.32 %
Loans to depository institutions
     -       -       -       60,000       777       5.14 %
Installment loans to individuals
     49,335       1,250       10.08 %     47,645       1,459       12.15 %
Previously securitized loans
     4,244       1,279       119.89 %     7,359       1,728       93.16 %
Total loans
     1,787,861       30,465       6.78 %     1,739,166       32,477       7.41 %
Securities:
                                                
Taxable
     381,810       5,817       6.06 %     442,627       5,968       5.35 %
Tax-exempt
     34,202       573       6.66 %     39,133       645       6.54 %
Total securities
     416,012       6,390       6.11 %     481,760       6,613       5.45 %
Deposits in depository institutions
     4,855       8       0.66 %     9,322       120       5.11 %
Federal funds sold
     -       -       -       435       5       4.56 %
Total interest-earning assets
     2,208,728       36,863       6.64 %     2,230,683       39,215       6.97 %
Cash and due from banks
     55,633                       50,695                  
Bank premises and equipment
     60,058                       53,006                  
Other assets
     208,314                       174,938                  
Less:  Allowance for loan losses
     (19,082 )                     (17,273 )                
       Total assets
   $ 2,513,651                     $ 2,492,049                  
                                                 
Liabilities:
                                                
Interest-bearing demand deposits
     402,000       596       0.59 %     404,613       989       0.97 %
Savings deposits
     354,661       843       0.95 %     346,955       1,446       1.65 %
Time deposits
     957,064       8,487       3.53 %     922,671       10,413       4.48 %
Short-term borrowings
     137,533       343       0.99 %     166,535       1,677       4.00 %
Long-term debt
     21,037       314       5.94 %     21,828       426       7.74 %
   Total interest-bearing liabilities
     1,872,295       10,583       2.25 %     1,862,602       14,951       3.18 %
Noninterest-bearing demand deposits
     327,145                       306,108                  
Other liabilities
     24,463                       28,350                  
Stockholders' equity
     289,748                       294,989                  
Total liabilities and
                                                
stockholders' equity
   $ 2,513,651                     $ 2,492,049                  
Net interest income
           $ 26,280                     $ 24,264          
Net yield on earning assets
                     4.73 %                     4.32 %
                                                 
 
 
18
 
                   
Consolidated Average Balance Sheets, Yields, and Rates
                    
(Unaudited) ($ in 000s)
                                    
                                     
   
Twelve Months Ended December 31,
  
         
2008
                
2007
        
   
Average
          
Yield/
    
Average
          
Yield/
  
   
Balance
    
Interest
    
Rate
    
Balance
    
Interest
    
Rate
  
                                     
Assets:
                                    
Loan portfolio:
                                    
Residential real estate
   $ 607,851     $ 37,495       6.17 %   $ 597,216     $ 36,574       6.12 %
Home equity
     364,325       26,266       7.21 %     330,997       25,524       7.71 %
Commercial, financial, and agriculture
     713,767       47,445       6.65 %     675,598       50,771       7.51 %
Loans to depository institutions
     1,161       35       3.01 %     57,315       3,048       5.32 %
Installment loans to individuals
     51,542       5,264       10.21 %     46,112       5,426       11.77 %
Previously securitized loans
     5,200       5,622       108.12 %     10,518       7,266       69.08 %
Total loans
     1,743,846       122,127       7.00 %     1,717,756       128,609       7.49 %
Securities:
                                                
Taxable
     422,708       23,852       5.64 %     472,438       25,677       5.43 %
Tax-exempt
     35,738       2,344       6.56 %     39,623       2,599       6.56 %
Total securities
     458,446       26,196       5.71 %     512,061       28,276       5.52 %
Deposits in depository institutions
     7,944       171       2.15 %     11,940       521       4.36 %
Federal funds sold
     -       -       -       15,690       819       5.22 %
Total interest-earning assets
     2,210,236       148,494       6.72 %     2,257,447       158,225       7.01 %
Cash and due from banks
     57,624                       50,675                  
Bank premises and equipment
     57,183                       48,929                  
Other assets
     195,820                       171,347                  
Less:  Allowance for loan losses
     (18,452 )                     (16,406 )                
       Total assets
   $ 2,502,411                     $ 2,511,992                  
                                                 
Liabilities:
                                                
Interest-bearing demand deposits
     409,799       2,576       0.63 %     418,532       4,766       1.14 %
Savings deposits
     359,754       3,640       1.01 %     342,119       5,705       1.67 %
Time deposits
     921,971       35,691       3.87 %     922,886       41,355       4.48 %
Short-term borrowings
     136,867       2,629       1.92 %     160,338       6,642       4.14 %
Long-term debt
     21,506       1,383       6.43 %     24,476       1,808       7.39 %
   Total interest-bearing liabilities
     1,849,897       45,919       2.48 %     1,868,351       60,276       3.23 %
Noninterest-bearing demand deposits
     323,551                       312,567                  
Other liabilities
     25,774                       29,435                  
Stockholders' equity
     303,189                       301,639                  
Total liabilities and
                                                
stockholders' equity
   $ 2,502,411                     $ 2,511,992                  
Net interest income
           $ 102,575                     $ 97,949          
Net yield on earning assets
                     4.64 %                     4.34 %
                                                 
 
 
19
 
                             
Analysis of Risk-Based Capital
                              
(Unaudited) ($ in 000s)
                              
                               
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec 31
  
   
2008 (a)
    
2008
    
2008
    
2008
    
2007
  
                               
Tier I Capital:
                              
Stockholders' equity
   $ 280,429     $ 284,912     $ 302,056     $ 304,841     $ 293,994  
Goodwill and other intangibles
     (57,479 )     (57,600 )     (57,893 )     (58,065 )     (58,238 )
Accumulated other comprehensive loss (income)
     10,599       14,477       3,718       (7,280 )     (633 )
Qualifying trust preferred stock
     16,000       16,000       16,000       16,000       16,000  
Unrealized Loss on AFS securities
     (3,342 )     (761 )     (712 )     (275 )     (247 )
Excess deferred tax assets
     (23,841 )     (15,470 )     -       -       -  
Total tier I capital
   $ 222,366     $ 241,558     $ 263,169     $ 255,221     $ 250,876  
                                         
                                         
Total Risk-Based Capital:
                                        
Tier I capital
   $ 222,366     $ 241,558     $ 263,169     $ 255,221     $ 250,876  
Qualifying allowance for loan losses
     22,254       18,879       17,959       18,567       17,581  
Total risk-based capital
   $ 244,620     $ 260,437     $ 281,128     $ 273,788     $ 268,457  
                                         
Net risk-weighted assets
   $ 1,875,934     $ 1,842,684     $ 1,855,401     $ 1,828,559     $ 1,776,158  
                                         
                                         
Ratios:
                                        
Average stockholders' equity to average assets
     11.53 %     12.45 %     12.46 %     12.03 %     11.84 %
Tangible capital ratio
     8.83 %     9.44 %     10.02 %     10.00 %     9.72 %
Risk-based capital ratios:
                                        
Tier I capital
     11.85 %     13.11 %     14.18 %     13.96 %     14.12 %
Total risk-based capital
     13.04 %     14.13 %     15.15 %     14.97 %     15.11 %
Leverage capital
     9.14 %     9.97 %     10.75 %     10.47 %     10.31 %
                                         
                                         
(a) December 31, 2008 risk-based capital ratios are estimated
                                  
                                         
                                         
                                         
                                         
CITY HOLDING COMPANY AND SUBSIDIARIES
                                        
Intangibles
                                        
(Unaudited) ($ in 000s)
                                        
                                         
   
As of and for the Quarter Ended
  
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec 31
  
   
2008
    
2008
    
2008
    
2008
    
2007
  
                                         
Intangibles, net
   $ 57,479     $ 57,600     $ 57,893     $ 58,065     $ 58,238  
Intangibles amortization expense
     121       173       172       173       177  
                                         
 
 
20
 
                             
Summary of Loan Loss Experience
                              
(Unaudited) ($ in 000s)
                              
                               
   
Quarter Ended
  
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec 31
  
   
2008
    
2008
    
2008
    
2008
    
2007
  
                               
Balance at beginning of period
   $ 18,879     $ 17,959     $ 18,567     $ 17,581     $ 16,980  
                                         
Charge-offs:
                                        
Commercial, financial, and agricultural
     1,073       563       1,022       406       359  
Real estate-mortgage
     603       523       190       274       203  
Installment loans to individuals
     29       62       77       75       108  
Overdraft deposit accounts
     779       783       604       985       938  
Total charge-offs
     2,484       1,931       1,893       1,740       1,608  
                                         
Recoveries:
                                        
Commercial, financial, and agricultural
     14       (30 )     41       13       23  
Real estate-mortgage
     79       69       48       27       36  
Installment loans to individuals
     45       71       72       108       97  
Overdraft deposit accounts
     381       391       274       695       405  
Total recoveries
     519       501       435       843       561  
                                         
Net charge-offs
     1,965       1,430       1,458       897       1,047  
Provision for loan losses
     5,340       2,350       850       1,883       1,650  
Balance at end of period
   $ 22,254     $ 18,879     $ 17,959     $ 18,567     $ 17,583  
                                         
Loans outstanding
   $ 1,812,344     $ 1,777,731     $ 1,750,047     $ 1,704,800     $ 1,767,021  
Average loans outstanding
     1,787,861       1,754,183       1,728,609       1,704,133       1,739,166  
Allowance as a percent of loans outstanding
     1.23 %     1.06 %     1.03 %     1.09 %     1.00 %
Allowance as a percent of non-performing loans
     86.07 %     135.92 %     122.89 %     113.55 %     103.28 %
Net charge-offs (annualized) as a
                                        
percent of average loans outstanding
     0.44 %     0.33 %     0.34 %     0.21 %     0.24 %
Net charge-offs, excluding overdraft deposit
                                        
accounts, (annualized) as a percent of average loans outstanding
     0.35 %     0.24 %     0.26 %     0.14 %     0.12 %
 
 
21
 
                             
Summary of Non-Performing Assets
                              
(Unaudited) ($ in 000s)
                              
                               
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec 31
  
   
2008
    
2008
    
2008
    
2008
    
2007
  
                               
Nonaccrual loans
   $ 25,224     $ 13,709     $ 14,018     $ 15,840     $ 16,437  
Accruing loans past due 90 days or more
     623       141       431       257       314  
Previously securitized loans past due 90 days or more
     10       40       165       255       76  
Total non-performing loans
     25,857       13,890       14,614       16,352       16,827  
Other real estate owned, excluding property associated
                                        
with previously securitized loans
     3,469       3,332       6,164       4,192       4,163  
Other real estate owned associated with previously
                                        
securitized loans
     400       417       321       148       -  
Other real estate owned
     3,869       3,749       6,485       4,340       4,163  
Total non-performing assets
   $ 29,726     $ 17,639     $ 21,099     $ 20,692     $ 20,990  
                                         
Non-performing assets as a percent of loans and
                                        
other real estate owned
     1.64 %     0.99 %     1.20 %     1.21 %     1.20 %
                                         
                                         
                                         
CITY HOLDING COMPANY AND SUBSIDIARIES
                                        
Summary of Total Past Due Loans
                                        
(Unaudited) ($ in 000s)
                                        
                                         
   
December 31
    
September 30
    
June 30
    
March 31
    
Dec 31
  
   
2008
    
2008
    
2008
    
2008
    
2007
  
                                         
Residential real estate
   $ 6,179     $ 3,636     $ 5,487     $ 3,763     $ 5,480  
Home equity
     1,243       1,400       1,316       1,344       2,141  
Commercial, financial, and agriculture
     1,679       1,741       1,166       806       1,506  
Loans to depository institutions
     -       -       -       -       -  
Installment loans to individuals
     241       216       290       360       385  
Previously securitized loans
     999       598       632       897       1,099  
Overdraft deposit accounts
     592       491       485       568       612  
Total past due loans
   $ 10,933     $ 8,082     $ 9,376     $ 7,738     $ 11,223  
                                         
                                         
 
21