West Virginia | 55-0619957 |
(State or Other Jurisdiction of | (I.R.S. Employer |
Incorporation or Organization) | Identification No.) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b)) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17CFR240.13e-4(c)) |
City Holding Company | |
By: | /s/ David L. Bumgarner |
David L. Bumgarner | |
Chief Financial Officer |
• | Return on assets and return on tangible equity of 1.25% and 13.8%, respectively. |
• | Net interest income increased $1.5 million from the quarter ended March 31, 2015 (excluding accretion from fair value adjustments). |
• | Total net loan growth of $14.6 million from December 31, 2015 to March 31, 2016. |
• | Average total deposit balances grew $45.3 million, exclusive of the impact of our acquisition of three branches in Lexington, Kentucky from American Founders Bank, Inc. (“AFB”) in November 2015, from the quarter ended December 31, 2015 to the quarter ended March 31, 2016. |
• | Repurchased 229,000 shares of common stock at a weighted average price of $43.31 per share. |
• | Increased our quarterly dividend from $0.42 per quarter to $0.43 per quarter. |
Three Months Ended | |||||||||||||||
March 31, | December 31, | September 31, | June 30, | March 31, | |||||||||||
2016 | 2015 | 2015 | 2015 | 2015 | |||||||||||
Earnings | |||||||||||||||
Net Interest Income (FTE) | $ | 29,312 | $ | 29,391 | $ | 28,005 | $ | 28,927 | $ | 29,533 | |||||
Net Income available to common shareholders | 11,702 | 13,515 | 10,607 | 11,983 | 17,992 | ||||||||||
Per Share Data | |||||||||||||||
Earnings per share available to common shareholders: | |||||||||||||||
Basic | $ | 0.78 | $ | 0.88 | $ | 0.69 | $ | 0.78 | $ | 1.18 | |||||
Diluted | 0.78 | 0.88 | 0.69 | 0.78 | 1.17 | ||||||||||
Weighted average number of shares: | |||||||||||||||
Basic | 14,915,792 | 15,157,598 | 15,177,947 | 15,103,976 | 15,066,693 | ||||||||||
Diluted | 14,926,941 | 15,174,103 | 15,198,007 | 15,127,238 | 15,149,085 | ||||||||||
Period-end number of shares | 14,971,171 | 15,180,215 | 15,319,450 | 15,276,950 | 15,213,324 | ||||||||||
Cash dividends declared | $ | 0.43 | $ | 0.42 | $ | 0.42 | $ | 0.42 | $ | 0.42 | |||||
Book value per share (period-end) | 27.93 | 27.62 | 27.34 | 26.92 | 26.63 | ||||||||||
Tangible book value per share (period-end) | 22.61 | 22.36 | 22.72 | 22.29 | 21.96 | ||||||||||
Market data: | |||||||||||||||
High closing price | $ | 47.78 | $ | 51.12 | $ | 51.73 | $ | 50.22 | $ | 48.09 | |||||
Low closing price | 40.82 | 43.85 | 45.56 | 45.00 | 41.76 | ||||||||||
Period-end closing price | 47.78 | 45.64 | 49.30 | 49.25 | 47.03 | ||||||||||
Average daily volume | 71,133 | 55,448 | 58,253 | 51,213 | 48,043 | ||||||||||
Treasury share activity: | |||||||||||||||
Treasury shares repurchased | 229,132 | 150,385 | — | — | — | ||||||||||
Average treasury share repurchase price | $ | 43.31 | $ | 46.91 | — | — | — |
Key Ratios (percent) | |||||||||||||||
Return on average assets | 1.25 | % | 1.48 | % | 1.21 | % | 1.34 | % | 2.04 | % | |||||
Return on average tangible equity | 13.8 | % | 15.5 | % | 12.2 | % | 14 | % | 21.6 | % | |||||
Yield on interest earning assets | 3.91 | % | 3.99 | % | 3.99 | % | 4.2 | % | 4.39 | % | |||||
Cost of interest bearing liabilities | 0.48 | % | 0.46 | % | 0.47 | % | 0.47 | % | 0.48 | % | |||||
Net Interest Margin | 3.53 | % | 3.62 | % | 3.62 | % | 3.82 | % | 3.99 | % | |||||
Non-interest income as a percent of total revenue | 31.1 | % | 32.5 | % | 33.0 | % | 31.6 | % | 45.0 | % | |||||
Efficiency Ratio (a) | 56.8 | % | 48.5 | % | 57.3 | % | 54.8 | % | 54.2 | % | |||||
Price/Earnings Ratio (b) | 15.40 | 12.94 | 17.84 | 15.69 | 9.96 | ||||||||||
Capital (period-end) | |||||||||||||||
Average Shareholders' Equity to Average Assets | 11.23 | % | 11.65 | % | 11.9 | % | 11.54 | % | 11.48 | % | |||||
Tangible equity to tangible assets | 9.03 | % | 9.34 | % | 10.14 | % | 9.89 | % | 9.6 | % | |||||
Consolidated risk based capital ratios (c): | |||||||||||||||
CET I | 13.38 | % | 13.65 | % | 14.42 | % | 14.17 | % | 14.04 | % | |||||
Tier I | 14 | % | 14.28 | % | 15.08 | % | 14.82 | % | 14.7 | % | |||||
Total | 14.78 | % | 15.1 | % | 15.95 | % | 15.7 | % | 15.57 | % | |||||
Leverage | 9.78 | % | 10.15 | % | 10.71 | % | 10.38 | % | 10.23 | % | |||||
Other | |||||||||||||||
Branches | 85 | 85 | 82 | 82 | 82 | ||||||||||
FTE | 854 | 853 | 828 | 844 | 845 | ||||||||||
Assets per FTE | $ | 4,484 | $ | 4,354 | $ | 4,233 | $ | 4,162 | $ | 4,205 | |||||
Deposits per FTE | 3,732 | 3,615 | 3,461 | 3,439 | 3,482 | ||||||||||
(a) The March 31, 2015 QTD efficiency ratio calculation excludes the gain on sale of insurance division. | |||||||||||||||
(b) The price/earnings ratio is computed based on annualized quarterly earnings. | |||||||||||||||
(c) March 31, 2016 risk-based capital ratios are estimated. |
Three Months Ended | |||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||
2016 | 2015 | 2015 | 2015 | 2015 | |||||||||||
Interest Income | |||||||||||||||
Interest and fees on loans | $ | 28,927 | $ | 29,032 | $ | 27,875 | $ | 28,812 | $ | 29,388 | |||||
Interest on investment securities: | |||||||||||||||
Taxable | 3,005 | 2,856 | 2,621 | 2,641 | 2,712 | ||||||||||
Tax-exempt | 357 | 334 | 272 | 267 | 264 | ||||||||||
Total Interest Income | 32,289 | 32,222 | 30,768 | 31,720 | 32,364 | ||||||||||
Interest Expense | |||||||||||||||
Interest on deposits | 2,898 | 2,760 | 2,686 | 2,699 | 2,741 |
Interest on short-term borrowings | 107 | 91 | 69 | 85 | 82 | ||||||||||
Interest on long-term debt | 164 | 159 | 155 | 153 | 150 | ||||||||||
Total Interest Expense | 3,169 | 3,010 | 2,910 | 2,937 | 2,973 | ||||||||||
Net Interest Income | 29,120 | 29,212 | 27,858 | 28,783 | 29,391 | ||||||||||
Provision for loan losses | 539 | 2,813 | 451 | 2,836 | 888 | ||||||||||
Net Interest Income After Provision for Loan Losses | 28,581 | 26,399 | 27,407 | 25,947 | 28,503 | ||||||||||
Non-Interest Income | |||||||||||||||
Gains on sale of investment securities | — | — | — | 2,116 | 14 | ||||||||||
Service charges | 6,303 | 6,893 | 6,907 | 6,589 | 5,927 | ||||||||||
Bankcard revenue | 3,967 | 3,923 | 3,895 | 4,002 | 4,074 | ||||||||||
Trust and investment management fee income | 1,276 | 1,547 | 1,176 | 1,201 | 1,200 | ||||||||||
Bank owned life insurance | 760 | 898 | 929 | 783 | 764 | ||||||||||
Gain on sale of insurance division | — | — | — | — | 11,084 | ||||||||||
Other income | 821 | 813 | 799 | 714 | 958 | ||||||||||
Total Non-Interest Income | 13,127 | 14,074 | 13,706 | 15,405 | 24,021 | ||||||||||
Non-Interest Expense | |||||||||||||||
Salaries and employee benefits | 12,673 | 11,296 | 12,179 | 12,193 | 12,179 | ||||||||||
Occupancy and equipment | 2,836 | 2,583 | 2,575 | 2,529 | 2,590 | ||||||||||
Depreciation | 1,567 | 1,539 | 1,522 | 1,516 | 1,511 | ||||||||||
FDIC insurance expense | 465 | 443 | 456 | 445 | 450 | ||||||||||
Advertising | 716 | 264 | 777 | 701 | 704 | ||||||||||
Bankcard expenses | 833 | 778 | 785 | 829 | 870 | ||||||||||
Postage, delivery, and statement mailings | 565 | 532 | 523 | 507 | 561 | ||||||||||
Office supplies | 353 | 273 | 384 | 347 | 346 | ||||||||||
Legal and professional fees | 471 | 662 | 620 | 542 | 567 | ||||||||||
Telecommunications | 428 | 409 | 418 | 463 | 475 | ||||||||||
Repossessed asset losses, net of expenses | 288 | 217 | 492 | 335 | 220 | ||||||||||
Merger related expenses | — | 315 | 175 | 108 | — | ||||||||||
Other expenses | 2,945 | 1,854 | 4,471 | 2,729 | 2,692 | ||||||||||
Total Non-Interest Expense | 24,140 | 21,165 | 25,377 | 23,244 | 23,165 | ||||||||||
Income Before Income Taxes | 17,568 | 19,308 | 15,736 | 18,108 | 29,359 | ||||||||||
Income tax expense | 5,866 | 5,793 | 5,129 | 6,125 | 11,367 | ||||||||||
Net Income Available to Common Shareholders | $ | 11,702 | $ | 13,515 | $ | 10,607 | $ | 11,983 | $ | 17,992 | |||||
Distributed earnings allocated to common shareholders | $ | 6,365 | $ | 6,303 | $ | 6,362 | $ | 6,344 | $ | 6,315 | |||||
Undistributed earnings allocated to common shareholders | 5,206 | 7,059 | 4,125 | 5,505 | 11,468 | ||||||||||
Net earnings allocated to common shareholders | $ | 11,571 | $ | 13,362 | $ | 10,487 | $ | 11,849 | $ | 17,783 | |||||
Average common shares outstanding | 14,916 | 15,158 | 15,178 | 15,104 | 15,067 | ||||||||||
Shares for diluted earnings per share | 14,927 | 15,175 | 15,198 | 15,127 | 15,149 | ||||||||||
Basic earnings per common share | $ | 0.78 | $ | 0.88 | $ | 0.69 | $ | 0.78 | $ | 1.18 | |||||
Diluted earnings per common share | $ | 0.78 | $ | 0.88 | $ | 0.69 | $ | 0.78 | $ | 1.17 |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||
2016 | 2015 | 2015 | 2015 | 2015 | |||||||||||
Assets | |||||||||||||||
Cash and due from banks | $ | 165,134 | $ | 58,829 | $ | 109,627 | $ | 142,335 | $ | 235,004 | |||||
Interest-bearing deposits in depository institutions | 10,031 | 11,284 | 9,081 | 11,089 | 10,106 | ||||||||||
Cash and cash equivalents | 175,165 | 70,113 | 118,708 | 153,424 | 245,110 | ||||||||||
Investment securities available-for-sale, at fair value | 362,282 | 369,466 | 300,865 | 287,609 | 273,856 | ||||||||||
Investment securities held-to-maturity, at amortized cost | 86,518 | 88,937 | 81,095 | 84,082 | 87,455 | ||||||||||
Other securities | 9,960 | 12,915 | 9,926 | 9,926 | 9,857 | ||||||||||
Total investment securities | 458,760 | 471,318 | 391,886 | 381,617 | 371,168 | ||||||||||
Gross loans | 2,877,117 | 2,862,534 | 2,695,645 | 2,683,835 | 2,632,395 | ||||||||||
Allowance for loan losses | (19,315 | ) | (19,251 | ) | (20,148 | ) | (20,187 | ) | (20,103 | ) | |||||
Net loans | 2,857,802 | 2,843,283 | 2,675,497 | 2,663,648 | 2,612,292 | ||||||||||
Bank owned life insurance | 98,679 | 97,919 | 97,157 | 96,663 | 95,880 | ||||||||||
Premises and equipment, net | 75,965 | 77,271 | 73,419 | 75,900 | 76,910 | ||||||||||
Accrued interest receivable | 8,517 | 7,432 | 7,690 | 7,838 | 7,752 | ||||||||||
Net deferred tax assets | 27,541 | 29,974 | 33,342 | 32,674 | 35,335 | ||||||||||
Intangible assets | 79,581 | 79,792 | 70,653 | 70,779 | 70,964 | ||||||||||
Other assets | 47,656 | 36,957 | 36,266 | 30,080 | 37,674 | ||||||||||
Total Assets | $ | 3,829,666 | $ | 3,714,059 | $ | 3,504,618 | $ | 3,512,623 | $ | 3,553,085 | |||||
Liabilities | |||||||||||||||
Deposits: | |||||||||||||||
Noninterest-bearing | $ | 666,523 | $ | 621,073 | $ | 542,177 | $ | 563,715 | $ | 551,596 | |||||
Interest-bearing: | |||||||||||||||
Demand deposits | 711,366 | 679,735 | 647,792 | 646,198 | 654,832 | ||||||||||
Savings deposits | 780,982 | 765,611 | 693,184 | 695,383 | 722,324 | ||||||||||
Time deposits | 1,028,400 | 1,017,556 | 982,349 | 997,387 | 1,013,630 | ||||||||||
Total deposits | 3,187,271 | 3,083,975 | 2,865,502 | 2,902,683 | 2,942,382 | ||||||||||
Short-term borrowings | |||||||||||||||
Federal Funds purchased | — | 13,000 | — | — | — | ||||||||||
Customer repurchase agreements | 156,714 | 141,869 | 147,036 | 153,171 | 132,588 | ||||||||||
Long-term debt | 16,495 | 16,495 | 16,495 | 16,495 | 16,495 | ||||||||||
Other liabilities | 51,068 | 39,448 | 56,818 | 29,034 | 56,545 | ||||||||||
Total Liabilities | 3,411,548 | 3,294,787 | 3,085,851 | 3,101,383 | 3,148,010 |
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 | 46,249 | 46,249 | 46,249 | 46,249 | 46,249 | ||||||||||
Capital surplus | 106,137 | 106,269 | 106,108 | 105,891 | 106,397 | ||||||||||
Retained earnings | 395,963 | 390,690 | 383,551 | 379,379 | 373,812 | ||||||||||
Cost of common stock in treasury | (129,142 | ) | (120,104 | ) | (113,581 | ) | (115,387 | ) | (118,130 | ) | |||||
Accumulated other comprehensive loss: | |||||||||||||||
Unrealized gain on securities available-for-sale | 3,670 | 927 | 1,789 | 457 | 2,096 | ||||||||||
Underfunded pension liability | (4,759 | ) | (4,759 | ) | (5,349 | ) | (5,349 | ) | (5,349 | ) | |||||
Total Accumulated Other Comprehensive Loss | (1,089 | ) | (3,832 | ) | (3,560 | ) | (4,892 | ) | (3,253 | ) | |||||
Total Stockholders' Equity | 418,118 | 419,272 | 418,767 | 411,240 | 405,075 | ||||||||||
Total Liabilities and Stockholders' Equity | $ | 3,829,666 | $ | 3,714,059 | $ | 3,504,618 | $ | 3,512,623 | $ | 3,553,085 | |||||
Regulatory Capital | |||||||||||||||
Total CET 1 capital | $ | 341,165 | $ | 345,620 | $ | 353,224 | $ | 346,979 | $ | 337,537 | |||||
Total tier 1 capital | 357,165 | 361,620 | 369,224 | 362,979 | 353,537 | ||||||||||
Total risk-based capital | 377,003 | 382,180 | 390,612 | 384,388 | 374,420 | ||||||||||
Total risk-weighted assets | 2,550,739 | 2,531,647 | 2,449,191 | 2,448,848 | 2,404,331 |
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||
2016 | 2015 | 2015 | 2015 | 2015 | |||||||||||
Residential real estate (1) | $ | 1,395,670 | $ | 1,383,133 | $ | 1,358,083 | $ | 1,325,453 | $ | 1,303,258 | |||||
Home equity - junior liens | 142,694 | 147,036 | 144,748 | 143,772 | 143,670 | ||||||||||
Commercial and industrial | 165,549 | 165,340 | 123,948 | 141,518 | 132,127 | ||||||||||
Commercial real estate (2) | 1,135,625 | 1,127,581 | 1,028,857 | 1,032,258 | 1,011,701 | ||||||||||
Consumer | 34,754 | 36,083 | 36,751 | 37,555 | 38,436 | ||||||||||
DDA overdrafts | 2,825 | 3,361 | 3,258 | 3,279 | 3,203 | ||||||||||
Gross Loans | $ | 2,877,117 | $ | 2,862,534 | $ | 2,695,645 | $ | 2,683,835 | $ | 2,632,395 | |||||
Construction loans included in: | |||||||||||||||
(1) - Residential real estate loans | $ | 13,966 | $ | 13,135 | $ | 14,765 | $ | 15,412 | $ | 17,459 | |||||
(2) - Commercial real estate loans | 15,172 | 12,599 | 11,970 | 4,043 | 30,554 | ||||||||||
Secondary Mortgage Loan Activity | |||||||||||||||
Mortgage loans originated | $ | 2,809 | $ | 3,855 | $ | 4,803 | $ | 5,007 | $ | 4,184 | |||||
Mortgage loans sold | 3,073 | 4,135 | 5,206 | 5,690 | 3,637 | ||||||||||
Mortgage loans gain on loans sold | 24 | 88 | 112 | 109 | 58 |
Three Months Ended | |||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||
2016 | 2015 | 2015 | 2015 | 2015 | |||||||||||
Allowance for Loan Losses | |||||||||||||||
Balance at beginning of period | $ | 19,251 | $ | 20,148 | $ | 20,187 | $ | 20,103 | $ | 20,074 | |||||
Charge-offs: | |||||||||||||||
Commercial and industrial | (1 | ) | (3,148 | ) | (82 | ) | (2,444 | ) | (94 | ) | |||||
Commercial real estate | (302 | ) | (303 | ) | (1 | ) | 61 | (337 | ) | ||||||
Residential real estate | (405 | ) | (386 | ) | (229 | ) | (272 | ) | (257 | ) | |||||
Home equity | (106 | ) | (76 | ) | (128 | ) | (17 | ) | (91 | ) | |||||
Consumer | (38 | ) | (39 | ) | (28 | ) | (69 | ) | (74 | ) | |||||
DDA overdrafts | (318 | ) | (376 | ) | (414 | ) | (313 | ) | (311 | ) | |||||
Total charge-offs | (1,170 | ) | (4,328 | ) | (882 | ) | (3,054 | ) | (1,164 | ) | |||||
Recoveries: | |||||||||||||||
Commercial and industrial | 1 | 2 | 45 | 9 | 18 | ||||||||||
Commercial real estate | 384 | 317 | 18 | 23 | 8 | ||||||||||
Residential real estate | 39 | 69 | 66 | 54 | 10 | ||||||||||
Home equity | — | — | — | — | — | ||||||||||
Consumer | 29 | 32 | 76 | 51 | 28 | ||||||||||
DDA overdrafts | 242 | 198 | 187 | 165 | 241 | ||||||||||
Total recoveries | 695 | 618 | 392 | 302 | 305 | ||||||||||
Net charge-offs | (475 | ) | (3,710 | ) | (490 | ) | (2,752 | ) | (859 | ) | |||||
Provision for (recovery of) acquired loans | 40 | 32 | (24 | ) | 299 | 246 | |||||||||
Provision for loan losses | 499 | 2,781 | 475 | 2,537 | 642 | ||||||||||
Balance at end of period | $ | 19,315 | $ | 19,251 | $ | 20,148 | $ | 20,187 | $ | 20,103 | |||||
Loans outstanding | $ | 2,877,117 | $ | 2,862,534 | $ | 2,695,645 | $ | 2,683,835 | $ | 2,632,395 | |||||
Allowance as a percent of loans outstanding | 0.7 | % | 0.7 | % | 0.7 | % | 0.8 | % | 0.8 | % | |||||
Allowance as a percent of non-performing loans | 120.4 | % | 110.4 | % | 92.2 | % | 127.1 | % | 121.4 | % | |||||
Average loans outstanding | $ | 2,864,943 | $ | 2,789,354 | $ | 2,679,429 | $ | 2,658,484 | $ | 2,636,400 | |||||
Net charge-offs (annualized) as a percent of average loans outstanding | 0.07 | % | 0.53 | % | 0.07 | % | 0.41 | % | 0.13 | % | |||||
Nonaccrual Loans (period-end) | |||||||||||||||
Residential real estate | $ | 2,977 | $ | 2,918 | $ | 3,012 | $ | 2,693 | $ | 2,299 | |||||
Home equity | 152 | 136 | 159 | 141 | 92 | ||||||||||
Commercial and industrial | 2,967 | 2,745 | 6,430 | 1,271 | 3,346 | ||||||||||
Commercial real estate | 9,718 | 11,149 | 11,806 | 11,518 | 10,445 | ||||||||||
Consumer | — | — | — | — | — | ||||||||||
Total nonaccrual loans | 15,814 | 16,948 | 21,407 | 15,623 | 16,182 |
Accruing loans past due 90 days or more | 225 | 495 | 449 | 264 | 384 | ||||||||||
Total non-performing loans | 16,039 | 17,443 | 21,856 | 15,887 | 16,566 | ||||||||||
Other real estate owned | 6,054 | 6,519 | 6,026 | 6,729 | 8,771 | ||||||||||
Total non-performing assets | $ | 22,093 | $ | 23,962 | $ | 27,882 | $ | 22,616 | $ | 25,337 | |||||
Non-performing assets as a percent of loans and other real estate owned | 0.77 | % | 0.84 | % | 1.03 | % | 0.84 | % | 0.96 | % | |||||
Past Due Loans (period-end) | |||||||||||||||
Residential real estate | $ | 5,045 | $ | 6,610 | $ | 5,522 | $ | 5,270 | $ | 6,118 | |||||
Home equity | 595 | 406 | 558 | 398 | 629 | ||||||||||
Commercial and industrial | 343 | 159 | 355 | 614 | 603 | ||||||||||
Commercial real estate | 2,138 | 1,480 | 3,622 | 2,715 | 2,317 | ||||||||||
Consumer | 82 | 196 | 218 | 257 | 272 | ||||||||||
DDA overdrafts | 514 | 313 | 330 | 327 | 215 | ||||||||||
Total past due loans | $ | 8,717 | $ | 9,164 | $ | 10,605 | $ | 9,581 | $ | 10,154 | |||||
Total past due loans as a percent of loans outstanding | 0.3 | % | 0.32 | % | 0.39 | % | 0.36 | % | 0.39 | % | |||||
Troubled Debt Restructurings ("TDRs") (period-end) | |||||||||||||||
Accruing: | |||||||||||||||
Residential real estate | $ | 18,306 | $ | 17,796 | $ | 18,154 | $ | 18,624 | $ | 18,451 | |||||
Home equity | 2,878 | 2,659 | 2,730 | 2,647 | 2,726 | ||||||||||
Commercial and industrial | 54 | 58 | 62 | 66 | 70 | ||||||||||
Commercial real estate | 523 | 1,746 | 1,921 | 1,872 | 1,894 | ||||||||||
Consumer | — | — | — | — | — | ||||||||||
Total accruing TDRs | $ | 21,761 | $ | 22,259 | $ | 22,867 | $ | 23,209 | $ | 23,141 | |||||
Non-Accruing | |||||||||||||||
Residential real estate | $ | 36 | $ | 191 | — | $ | 397 | $ | 616 | ||||||
Home equity | — | 34 | 16 | 15 | 15 | ||||||||||
Commercial and industrial | — | — | — | — | — | ||||||||||
Commercial real estate | — | — | — | — | — | ||||||||||
Consumer | — | — | — | — | — | ||||||||||
Total non-accruing TDRs | $ | 36 | $ | 225 | $ | 16 | $ | 412 | $ | 631 | |||||
Total TDRs | $ | 21,797 | $ | 22,484 | $ | 22,883 | $ | 23,621 | $ | 23,772 |
Three Months Ended | ||||||||||||||||||||||||
March 31, 2016 | December 31, 2015 | March 31, 2015 | ||||||||||||||||||||||
Average | Yield/ | Average | Yield/ | Average | Yield/ | |||||||||||||||||||
Balance | Interest | Rate | Balance | Interest | Rate | Balance | Interest | Rate |
Assets: | |||||||||||||||||||||||||
Loan portfolio (1): | |||||||||||||||||||||||||
Residential real estate (2) | $ | 1,531,966 | $ | 14,918 | 3.92 | % | $ | 1,518,581 | $ | 14,763 | 3.86 | % | $ | 1,441,331 | $ | 14,120 | 3.97 | % | |||||||
Commercial, financial, and agriculture (2) | 1,294,345 | 12,919 | 4.01 | % | 1,230,907 | 13,034 | 4.2 | % | 1,153,250 | 14,026 | 4.93 | % | |||||||||||||
Installment loans to individuals (2), (3) | 38,632 | 721 | 7.51 | % | 39,865 | 750 | 7.46 | % | 41,819 | 791 | 7.67 | % | |||||||||||||
Previously securitized loans (4) | *** | 369 | *** | *** | 485 | *** | *** | 451 | *** | ||||||||||||||||
Total loans | 2,864,943 | 28,927 | 4.06 | % | 2,789,354 | 29,032 | 4.13 | % | 2,636,400 | 29,388 | 4.52 | % | |||||||||||||
Securities: | |||||||||||||||||||||||||
Taxable | 421,289 | 3,005 | 2.87 | % | 387,048 | 2,856 | 2.93 | % | 327,185 | 2,712 | 3.36 | % | |||||||||||||
Tax-exempt (5) | 41,898 | 549 | 5.27 | % | 37,818 | 513 | 5.38 | % | 28,477 | 406 | 5.78 | % | |||||||||||||
Total securities | 463,187 | 3,554 | 3.09 | % | 424,866 | 3,369 | 3.15 | % | 355,662 | 3,118 | 3.56 | % | |||||||||||||
Deposits in depository institutions | 10,529 | — | — | 9,562 | — | — | 8,968 | — | — | ||||||||||||||||
Total interest-earning assets | 3,338,659 | 32,481 | 3.91 | % | 3,223,782 | 32,401 | 3.99 | % | 3,001,030 | 32,506 | 4.39 | % | |||||||||||||
Cash and due from banks | 81,569 | 117,290 | 222,409 | ||||||||||||||||||||||
Premises and equipment, net | 76,945 | 75,729 | 77,638 | ||||||||||||||||||||||
Other assets | 256,329 | 248,685 | 244,686 | ||||||||||||||||||||||
Less: Allowance for loan losses | (20,591 | ) | (21,101 | ) | (20,658 | ) | |||||||||||||||||||
Total assets | $ | 3,732,911 | $ | 3,644,385 | $ | 3,525,105 | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 677,849 | $ | 145 | 0.09 | % | $ | 650,523 | $ | 126 | 0.08 | % | $ | 636,810 | $ | 132 | 0.08 | % | |||||||
Savings deposits | 767,262 | 228 | 0.12 | % | 732,129 | 192 | 0.1 | % | 694,700 | 181 | 0.11 | % | |||||||||||||
Time deposits (2) | 1,019,416 | 2,525 | 1 | % | 1,004,296 | 2,442 | 0.96 | % | 1,021,474 | 2,428 | 0.96 | % | |||||||||||||
Short-term borrowings | 162,046 | 107 | 0.27 | % | 165,996 | 91 | 0.22 | % | 129,647 | 82 | 0.26 | % | |||||||||||||
Long-term debt | 16,495 | 164 | 4 | % | 16,495 | 159 | 3.82 | % | 16,495 | 150 | 3.69 | % | |||||||||||||
Total interest-bearing liabilities | 2,643,068 | 3,169 | 0.48 | % | 2,569,439 | 3,010 | 0.46 | % | 2,499,126 | 2,973 | 0.48 | % | |||||||||||||
Noninterest-bearing demand deposits | 630,524 | 609,350 | 571,340 | ||||||||||||||||||||||
Other liabilities | 40,198 | 41,141 | 49,996 | ||||||||||||||||||||||
Stockholders' equity | 419,121 | 424,455 | 404,643 | ||||||||||||||||||||||
Total liabilities and | |||||||||||||||||||||||||
stockholders' equity | $ | 3,732,911 | $ | 3,644,385 | $ | 3,525,105 | |||||||||||||||||||
Net interest income | $ | 29,312 | $ | 29,391 | $ | 29,533 | |||||||||||||||||||
Net yield on earning assets | 3.53 | % | 3.62 | % | 3.99 | % | |||||||||||||||||||
(1) For purposes of this table, non-accruing loans have been included in average balances and loan fees, which are immaterial, have been included in interest income. | |||||||||||||||||||||||||
(2) Included in the above table are the following amounts (in thousands) for the accretion of the fair value adjustments related to the acquisitions of Virginia Savings Bancorp ("Virginia Savings"), Community Financial Corporation ("Community") and American Founders Banks, Inc. ("AFB"): | |||||||||||||||||||||||||
Residential real estate | $ | 181 | $ | 196 | $ | 197 | |||||||||||||||||||
Commercial, financial, and agriculture | 394 | 1,146 | 1,988 | ||||||||||||||||||||||
Installment loans to individuals | 54 | 50 | 96 | ||||||||||||||||||||||
Time deposits | 148 | 180 | 169 | ||||||||||||||||||||||
$ | 777 | $ | 1,572 | $ | 2,450 | ||||||||||||||||||||
(3) Includes the Company’s consumer and DDA overdrafts loan categories. | |||||||||||||||||||||||||
(4) Effective January 1, 2012, the carrying value of the Company's previously securitized loans was reduced to $0. |
(5) Computed on a fully federal tax-equivalent basis assuming a tax rate of approximately 35%. |
Three Months Ended | ||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||
2016 | 2015 | 2015 | 2015 | 2015 | ||||||||||||
Purchased Credit Impaired Loans | ||||||||||||||||
Virginia Savings Acquisition | ||||||||||||||||
Contractual required principal and interest | $ | 1,942 | $ | 1,965 | $ | 2,149 | $ | 2,376 | $ | 2,419 | ||||||
Carrying value | 1,715 | 1,707 | 1,861 | 1,984 | 1,979 | |||||||||||
Community Acquisition | ||||||||||||||||
Contractual required principal and interest | $ | 14,415 | $ | 16,362 | $ | 17,834 | $ | 18,546 | $ | 20,189 | ||||||
Carrying value | 11,219 | 12,899 | 13,400 | 13,958 | 14,627 | |||||||||||
Accretion | ||||||||||||||||
The following table presents the actual and forecasted accretion related to the fair value adjustments on net interest income recorded as a result of the Virginia Savings Bancorp ("Virginia Savings"), Community Financial Corporation ("Community") and American Founders Bank, Inc. ("AFB") acquisitions. | ||||||||||||||||
Virginia Savings Acquistion | ||||||||||||||||
Loans | $ | 104 | $ | 138 | $ | 245 | $ | 190 | $123 | |||||||
Certificates of deposit | 124 | 129 | 129 | 129 | 129 | |||||||||||
$ | 228 | $ | 267 | $ | 374 | $ | 319 | $ | 252 | |||||||
Community Acquisition | ||||||||||||||||
Loans | $ | 408 | $ | 1,226 | $ | 642 | $ | 1,248 | $ | 2,158 | ||||||
Certificates of deposit | 11 | 40 | 40 | 40 | 40 | |||||||||||
$ | 419 | $ | 1,266 | $ | 682 | $ | 1,288 | $ | 2,198 | |||||||
AFB Acquisition | ||||||||||||||||
Loans | $ | 117 | $ | 28 | — | — | — | |||||||||
Certificates of deposit | 13 | 11 | — | — | — | |||||||||||
$ | 130 | $ | 39 | — | — | — | ||||||||||
All Acquisitions | ||||||||||||||||
Loans | $ | 629 | $ | 1,392 | $ | 887 | $ | 1,438 | $ | 2,281 | ||||||
Certificates of deposit | 148 | 180 | 169 | 169 | 169 | |||||||||||
$ | 777 | $ | 1,572 | $ | 1,056 | $ | 1,607 | $ | 2,450 | |||||||
Accretion Forecast | ||||||||||||||||
Remainder of 2016 | $ | 1,632 | ||||||||||||||
Year Ended December 31, 2017 | 1,007 | |||||||||||||||
Year Ended December 31, 2018 | 772 | |||||||||||||||
Note: The amounts reflected 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. | ||||||||||||||||
Three Months Ended | |||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||
2016 | 2015 | 2015 | 2015 | 2015 | |||||||||||
Net Interest Income/Margin | |||||||||||||||
Net interest income, fully taxable equivalent | $ | 29,312 | $ | 29,391 | $ | 28,005 | $ | 28,927 | $ | 29,533 | |||||
Taxable equivalent adjustment | (192 | ) | (179 | ) | (147 | ) | (144 | ) | (142 | ) | |||||
Net interest income ("GAAP") | $ | 29,120 | $ | 29,212 | $ | 27,858 | $ | 28,783 | $ | 29,391 | |||||
Average interest earning assets | $ | 3,338,659 | $ | 3,223,782 | $ | 3,071,595 | $ | 3,040,176 | $ | 3,001,030 | |||||
Net Interest Margin | 3.53 | % | 3.62 | % | 3.62 | % | 3.82 | % | 3.99 | % | |||||
Net interest income, fully taxable equivalent, excluding accretion | $ | 28,535 | $ | 27,819 | $ | 26,949 | $ | 27,320 | $ | 27,083 | |||||
Taxable equivalent adjustment | (192 | ) | (179 | ) | (147 | ) | (144 | ) | (142 | ) | |||||
Accretion related to fair value adjustments | 777 | 1,572 | 1,056 | 1,607 | 2,450 | ||||||||||
Net interest income ("GAAP") | $ | 29,120 | $ | 29,212 | $ | 27,858 | $ | 28,783 | $ | 29,391 | |||||
Average interest earning assets | $ | 3,338,659 | $ | 3,223,782 | $ | 3,071,595 | $ | 3,040,176 | $ | 3,001,030 | |||||
Net Interest Margin (excluding accretion) | 3.44 | % | 3.42 | % | 3.48 | % | 3.6 | % | 3.66 | % | |||||
Tangible Equity Ratio (period end) | |||||||||||||||
Tangible common equity to tangible assets | 9.03 | % | 9.34 | % | 10.14 | % | 9.89 | % | 9.6 | % | |||||
Effect of goodwill and other intangibles, net | 1.89 | % | 1.95 | % | 1.81 | % | 1.82 | % | 1.81 | % | |||||
Equity to assets ("GAAP") | 10.92 | % | 11.29 | % | 11.95 | % | 11.71 | % | 11.4 | % |