-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HyWzDXRy1BWnIwQkU3zlUa5YVJpJN/6C+KlTuvbLULiG5ZVC/K8Wq3rIbAevOHwv LjV5cPuEKXuO6dji/iDW6A== 0000931763-02-002461.txt : 20020716 0000931763-02-002461.hdr.sgml : 20020716 20020716154700 ACCESSION NUMBER: 0000931763-02-002461 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20020716 ITEM INFORMATION: FILED AS OF DATE: 20020716 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COLONIAL BANCGROUP INC CENTRAL INDEX KEY: 0000092339 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 630661573 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13508 FILM NUMBER: 02703957 BUSINESS ADDRESS: STREET 1: ONE COMMERCE ST STE 800 STREET 2: P O BOX 1108 CITY: MONTGOMERY STATE: AL ZIP: 36104 BUSINESS PHONE: 3342405000 MAIL ADDRESS: STREET 1: ONE COMMERCE STREET STE 800 STREET 2: PO BOX 1108 CITY: MONTGOMERY STATE: AL ZIP: 36101 FORMER COMPANY: FORMER CONFORMED NAME: SOUTHLAND BANCORPORATION DATE OF NAME CHANGE: 19820205 8-K 1 d8k.txt FORM 8-K ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): July 16, 2002 THE COLONIAL BANCGROUP, INC. (Exact name of registrant as specified in its charter) Delaware 1-13508 63-0661573 (State of Incorporation) (Commission File No.) (IRS Employer I.D. No.) Colonial Financial Center, Suite 800 One Commerce Street, Montgomery, Alabama 36104 ------------------------------------------------------- (Address of Principal Executive Office) (Zip code) Registrant's telephone number, including area code: 334-240-5000 ================================================================================ Item 9. Regulation FD Disclosure Information regarding the Registrant's earnings results for the quarter ended June 30, 2002 is furnished herein as Regulation F-D Disclosure. As additional Regulation F-D Disclosure, the Registrant furnishes the press release referenced as Exhibit No. 99.1. Exhibit No. Document Description - ----------- -------------------- 99.1 Press Release Announcing Record Earnings Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by this undersigned hereunto duly authorized. THE COLONIAL BANCGROUP, INC. ---------------------------- (Registrant) /s/ W. FLAKE OAKLEY, IV Date: July 16, 2002 ---------------------------- BY: W. Flake Oakley ITS: Chief Financial Officer For more information contact: July 16, 2002 Investors: Media: Lisa Free (334) 240-5105 Bob Howell (334) 240-5025 Flake Oakley (334) 240-5061 COLONIAL BANCGROUP ANNOUNCES RECORD 2nd QUARTER MONTGOMERY, AL --- The Colonial BancGroup, Inc. Chairman and CEO, Robert E. Lowder, announced today record earnings for the second quarter ended June 30, 2002 of $36.1 million or $0.30 per share. This represents an 18% increase in earnings and a 15% increase in diluted earnings per share over the second quarter of 2001. Return on average assets was 1.08% and return on average equity was 14.78% for the quarter. Cash basis return on average tangible assets was 1.12% and cash basis return on average tangible equity was 18.74%. For the six months ended June 30, 2002 net income was $70.2 million, an 18% increase over the same period in 2001, translating into $0.59 per share for the six months ended June 30, 2002, a 14% increase over earnings per share in the same period of 2001. 1 Asset quality remains very good and has improved over the first quarter of 2002, with nonperforming assets totaling $62.4 million or 0.60% of loans and other real estate. This compares with $67.3 million or 0.66% of loans and other real estate at March 31, 2002. Annualized net charge-offs were 0.19% of average loans for the second quarter of 2002 and 0.22% for the year to date. "We believe these asset quality statistics again will be among the best for banks with over $10 billion in assets," said Mr. Lowder. Loan provision expense for the quarter was $8.5 million compared to $7.5 million in the second quarter of 2001 and $9.5 million in the first quarter of 2002. Loan balances increased $134 million from March 31, 2002 to June 30, 2002. Colonial's regional bank loans increased $110 million and volume in Colonial's mortgage warehouse unit increased $55 million. These increases were partially offset by a decrease of $31 million in the bank's single family real estate portfolio of mostly adjustable rate mortgage loans. "We continue to focus on our strengths, lending to solid customers with sound collateral, primarily real estate. As a result of that strategy we reported for this quarter the best earnings in the company's history. We believe the investments we are making in expanding our existing markets, improving technology and delivery systems and enhancing our products will continue to build on that sound earnings basis," said Mr. Lowder. Core (non-time) deposits continue to increase, reflecting Colonial's emphasis on building customer relationships in its growth markets. Average core deposits increased $265 million or 27%, annualized, in the second quarter of 2002 compared to the first 2 quarter 2002 and $587 million or 16%, compared to the second quarter of 2001. Included in these increases were approximately $220 million in non-time deposits from the First Mercantile acquisition in the Texas market completed on March 28, 2002. Colonial's Florida markets continue to provide the strongest growth with core deposits increasing 19%, annualized, from the first quarter of 2002, and 20%, annualized, from the second quarter of 2001. Total noninterest income, excluding security gains, increased $1.3 million or 6% in the second quarter of 2002 compared to the same period in 2001. The principal areas of increase include mortgage origination income up $809,000 or 39%, electronic banking services up $479,000 or 29%, cash management services up $169,000 or 24% and wealth management services up $152,000 or 7%. Noninterest expenses were $76.4 million in the current quarter compared to $71.8 million in the second quarter of 2001, reflecting the Company's continued investment in retail banking and information technology. This increase also includes approximately $2.7 million in additional operating expenses from the First Mercantile acquisition. The efficiency ratio continued to improve to 54.55% from 56.53% in the second quarter of 2001. During the quarter Colonial announced the signing of a definitive agreement to acquire Palm Beach National Holding Company with approximately $356 million in assets and eight branch locations in Palm Beach County, Florida, in a stock for stock transaction valued at approximately $105.5 million. 3 Colonial BancGroup currently operates 269 offices with $13.7 billion in assets in Alabama, Florida, Georgia, Nevada, Tennessee and Texas and is traded on the New York Stock Exchange under the symbol CNB. In most newspapers the stock is listed as ColBgp. More detailed information on Colonial BancGroup's quarterly earnings is available on the company's website at www.colonialbank.com or in the Current -------------------- Report on Form 8-K filed today with the Securities and Exchange Commission. Copies of the Form 8-K are also available from the contact persons listed above. This release and the above referenced Current Report on Form 8-K of which this release forms a part contain "forward-looking statements" within the meaning of the federal securities laws. The forward-looking statements in this release are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among other things, the following possibilities; (i) an inability of the company to realize elements of its strategic plans for 2002 and beyond; (ii) increases in competitive pressure in the banking industry; (iii) general economic conditions, either nationally or regionally, that are less favorable than expected; (iv)and changes which may occur in the regulatory environment. When used in this Report, the words "believes," "estimates,", "plans," "expects," "should," "may," "might," "outlook," and "anticipates," and similar expressions as they relate to BancGroup (including its subsidiaries) or its management are intended to identify forward-looking statements. Forward-looking statements speak only as to the date they are made. BancGroup does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made. 4 EX-99.1 3 dex991.txt PRESS RELEASE THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------- % Change Statement of Condition Summary June 30, December 31, June 30, June 30, (Dollars in millions, except per share amounts) 2002 2001 2001 '01 to '02 - ------------------------------------------------------------------------------------------------------------------------- Total Assets $ 13,673 $ 13,185 $ 12,570 9% Loans 10,370 10,368 10,003 4% Total earning assets 12,764 12,301 11,796 8% Deposits 8,654 8,323 8,540 1% Shareholders' equity 961 865 826 16% Book value per share $ 8.13 $ 7.50 $ 7.35 11% - -------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------ Six Months Ended % Change ended Three Months Ended % Change ended Earnings Summary June 30 June 30, June 30, June 30, June 30, June 30, (Dollars in thousands, except per share amounts) 2002 2001 '01 to '02 2002 2001 '01 to '02 - ------------------------------------------------------------------------------------------------------------------------------------ Net interest income (taxable equivalent) $ 227,249 $ 209,124 9% $ 116,862 $ 105,601 11% Provision for loan losses 17,974 16,942 6% 8,496 7,478 14% Noninterest income 46,358 43,042 8% 23,428 22,204 6% Noninterest expense 146,908 140,189 5% 76,400 71,829 6& Net income $ 70,235 $ 59,729 18% $ 36,055 $ 30,534 18% - ------------------------------------------------------ EARNINGS PER SHARE: - ------------------------------------------------------ Net Income Basic $ 0.59 $ 0.52 14% $ 0.30 $ 0.27 11% Diluted $ 0.59 $ 0.52 14% $ 0.30 $ 0.26 15% Average shares outstanding 117,554 114,598 119,702 114,711 Average diluted shares outstanding 118,747 115,731 120,956 115,886 - ------------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------- June 30, December 31, June 30, Nonperforming Assets 2002 2001 2001 - ----------------------------------------------------------------------------------------------------- Total non-performing assets ratio 0.60% 0.64% 0.71% Allowance as a percent of nonperforming loans 325% 239% 194% Net charge-offs ratio (annualized): Quarter to date 0.19% 0.34% 0.28% Year to date 0.22% 0.28% 0.22% - -----------------------------------------------------------------------------------------------------
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES CONDENSED STATEMENT OF INCOME (unaudited)
- --------------------------------------------------------------------------------------------------------------------------------- Six Months Ended ------------------ Earnings Summary 2nd Qtr. 1st Qtr. 4th Qtr. 3rd Qtr. 2nd Qtr. June 30, June 30, (Dollars in thousands, except per share amounts) 2002 2002 2001 2001 2001 2002 2001 - --------------------------------------------------------------------------------------------------------------------------------- Net Interest Income $116,096 $109,656 $109,340 $105,069 $104,917 $225,752 $207,520 Provision for Loan Loss 8,496 9,478 14,730 7,901 7,478 17,974 16,942 Noninterest Income: Service charges on deposit accounts 11,051 10,603 11,142 10,706 10,687 21,654 20,184 Wealth Management 2,434 2,660 2,171 1,975 2,282 5,094 4,524 Electronic Banking 2,124 1,873 2,057 1,661 1,645 3,998 3,200 Mortgage Origination 2,871 2,155 2,873 1,896 2,062 5,027 3,518 Securities gains(losses), net 664 (1) 6,756 - 756 663 1,945 Other income 4,284 5,637 4,910 4,517 4,772 9,922 9,671 --------------------------------------------------------------------------- Total noninterest income 23,428 22,927 29,909 20,755 22,204 46,358 43,042 Noninterest Expense: Salaries and employee benefits 40,142 37,367 37,510 35,579 36,675 77,509 71,596 Occupancy and equipment expenses 16,893 16,472 16,832 16,106 16,146 33,365 31,769 Amortization of intangibles 713 162 861 2,102 1,648 875 3,288 Merger related expenses 13 64 2,710 335 4 77 4 Other expense 18,639 16,442 16,732 15,210 17,356 35,082 33,532 --------------------------------------------------------------------------- Total noninterest expense 76,400 70,507 74,645 69,332 71,829 146,908 140,189 Income from continuing operations before tax 54,628 52,598 49,874 48,591 47,814 107,228 93,431 Income tax 18,573 18,420 17,955 17,524 17,280 36,993 33,702 --------------------------------------------------------------------------- Income from continuing operations 36,055 34,178 31,919 31,067 30,534 70,235 59,729 Discontinued operations, net of tax - - - (613) - - - --------------------------------------------------------------------------- Net Income $ 36,055 $ 34,178 31,919 $ 30,454 $ 30,534 70,235 59,729 Exclude discontinued operations, net of tax - - - 613 - - - Merger related costs (net of tax): Loan loss provisions - - 640 - - - - Personnel costs - 35 257 164 - 35 - Other 8 6 1,733 215 3 14 3 --------------------------------------------------------------------------- Total 8 41 2,630 379 3 49 3 --------------------------------------------------------------------------- OPERATING EARNINGS $ 36,063 $ 34,219 $ 34,549 $ 31,446 $ 30,537 70,284 59,732 --------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- Earnings per share - Diluted Operating earnings $ 0.30 $ 0.29 $ 0.30 $ 0.27 $ 0.26 $ 0.59 $ 0.52 Cash basis operating earnings $ 0.30 $ 0.29 $ 0.30 $ 0.29 $ 0.28 $ 0.60 $ 0.54 - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- Selected ratios from operating earnings Return on average assets 1.08% 1.09% 1.05% 1.00% 0.97% 1.09% 0.96% Return on average equity 14.78% 15.85% 15.84% 14.87% 15.11% 15.31% 14.91% Efficiency ratio 54.55% 52.78% 53.71% 54.31% 56.53% 53.71% 55.99% Noninterest income*(excl sec gains)/ avg assets 0.70% 0.73% 0.71% 0.66% 0.68% 0.71% 0.67% Noninterest expense*/ avg assets 2.31% 2.22% 2.20% 2.19% 2.28% 2.26% 2.26% Net interest margin 3.77% 3.72% 3.57% 3.56% 3.56% 3.75% 3.59% Equity to assets 7.03% 7.21% 6.56% 6.72% 6.57% Tier one leverage 7.04% 7.45% 6.24% 6.57% 6.40% - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- Selected ratios from cash basis operating earnings Return on average tangible assets 1.12% 1.11% 1.08% 1.07% 1.03% 1.11% 1.02% Return on average equity 15.03% 15.92% 16.20% 15.83% 15.85% 15.46% 15.66% Return on average tangible equity 18.74% 18.33% 18.41% 17.75% 17.90% 18.55% 17.70% - ---------------------------------------------------------------------------------------------------------------------------------
*Annualized Note: Net income includes pretax costs associated with mergers and acquisitions totaling $4,110,000 in the 4th quarter of 2001. In the 4th quarter 2001 these costs are composed of a $1 million additional loan provision to align Manufacturer's loan provisions with Colonial standards, $400,000 in personnel costs to complete the mergers and $2,710,000 in other merger related expenses, consisting of severance pay, contract buyouts, brokerage commissions, legal, accounting, equipment write offs and other similar costs. THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CONDITION (Unaudited)
- --------------------------------------------------------------------------------------------------------------------------------- STATEMENTS OF CONDITION June 30, March 31, December 31, September 30, June 30, (Dollars in thousands) 2002 2002 2001 2001 2001 - --------------------------------------------------------------------------------------------------------------------------------- Assets: Cash and due from banks $ 291,261 $ 288,950 $ 373,024 $ 306,603 $ 320,091 Interest-bearing deposits in banks and federal funds sold 20,571 25,312 15,084 72,497 103,475 Securities available for sale 2,317,982 1,977,148 1,852,439 1,905,705 1,621,917 Investment securities 24,917 27,519 30,055 32,675 38,062 Mortgage loans held for sale 31,079 23,653 35,453 24,668 29,273 Loans 10,369,823 10,236,272 10,367,665 9,979,118 10,003,391 Less: Allowance for loan losses (132,326) (128,782) (122,200) (115,344) (116,642) ------------------------------------------------------------------------------------ Loans, net 10,237,497 10,107,490 10,245,465 9,863,774 9,886,749 Premises and equipment, net 232,623 226,870 198,983 190,444 190,359 Intangible assets, net 190,396 190,912 113,898 89,778 91,881 Other real estate owned 21,767 21,408 15,553 12,805 10,823 Accrued interest and other assets 304,741 295,032 305,149 287,456 277,639 - --------------------------------------------------------------------------------------------------------------------------------- Total $ 13,672,834 $ 13,184,294 $ 13,185,103 $ 12,786,405 $ 12,570,269 - --------------------------------------------------------------------------------------------------------------------------------- Liabilities and Shareholders' Equity: Deposits $ 8,653,567 $ 8,598,167 $ 8,322,979 $ 8,261,121 $ 8,539,571 Short-term borrowings 2,105,037 1,644,251 2,128,133 1,887,072 1,524,737 Subordinated debt 270,361 264,924 265,550 274,047 260,058 Trust preferred securities 183,039 176,866 70,000 73,000 73,000 FHLB long-term debt 1,390,413 1,396,521 1,361,938 1,241,053 1,162,168 Other long-term debt 28,100 58,147 88,652 89,059 89,064 Other liabilities 81,320 94,432 83,077 101,438 95,480 ------------------------------------------------------------------------------------ Total liabilities 12,711,837 12,233,308 12,320,329 11,926,790 11,744,078 Total shareholders' equity 960,997 950,986 864,774 859,615 826,191 - --------------------------------------------------------------------------------------------------------------------------------- Total $ 13,672,834 $ 13,184,294 $ 13,185,103 $ 12,786,405 $ 12,570,269 - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- Common Shares Issued 120,196,874 120,105,813 115,244,185 114,888,150 114,831,838 Common Shares Outstanding 118,196,874 120,105,813 115,244,185 112,464,638 112,455,092 Treasury Shares Outstanding 2,000,000 - - 2,423,512 2,376,746 - ---------------------------------------------------------------------------------------------------------------------------------
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
- ------------------------------------------------------------------------------------------------------------------------------------ Three Months Ended - ------------------------------------------------------------------------------------------------------------------------------------ AVERAGE VOLUME AND RATES (unaudited) June 30, March 31, June 30, (Dollars in thousands) 2002 2002 2001 - ------------------------------------------------------------------------------------------------------------------------------------ Average Average Average Volume Interest Rate Volume Interest Rate Volume Interest Rate - ------------------------------------------------------------------------------------------------------------------------------------ Assets Loans, net $ 9,402,534 $157,061 6.70% $ 9,094,471 $153,270 6.82% $ 9,499,614 $194,882 8.22% Mortgage warehouse lending 828,127 9,136 4.36% 871,239 9,381 4.31% 862,074 13,306 6.11% Mortgage loans held for sale 20,129 326 6.48% 20,624 352 6.83% 22,788 381 6.69% Investment securities and securities available for sale and other interest-earning assets 2,143,556 29,336 5.47% 1,956,832 27,527 5.63% 1,513,085 25,116 6.64% ---------------------- --------------------- ---------------------- Total interest-earning assets(1) 12,394,346 $195,859 6.33% 11,943,166 $190,530 6.44% 11,897,561 $233,685 7.87% Nonearning assets 850,526 764,648 698,965 ----------- ----------- ----------- Total assets $13,244,872 $12,707,814 $12,596,526 - --------------------------------------------------------------------- ------------------------------------------------------------- Liabilities and Shareholders' Equity: Interest-bearing non-time deposits $ 2,901,762 $ 9,701 1.34% $ 2,682,864 $ 8,389 1.29% $ 2,494,349 $ 15,777 2.54% Time deposits 4,218,130 36,261 3.45% 4,169,579 39,840 3.87% 4,816,324 71,388 5.94% Short-term borrowings 1,743,501 7,964 1.83% 1,730,538 7,833 1.84% 1,719,105 19,373 4.52% Long-term debt 1,940,231 25,071 5.18% 1,803,559 24,082 5.40% 1,447,793 21,546 5.97% ---------------------- --------------------- ---------------------- Total interest-bearing liabilities 10,803,624 $78,997 2.93% 10,386,540 $ 80,144 3.14% 10,477,571 $128,084 4.90% Noninterest-bearing demand deposits 1,394,292 1,351,046 1,209,693 Other liabilities 77,394 94,592 98,574 ----------- ----------- ----------- Total liabilities 12,275,310 11,832,178 11,785,838 Shareholders' equity 969,562 875,636 810,688 ----------- ----------- ----------- Total liabilities and shareholders' equity $13,244,872 $12,707,814 $12,596,526 - --------------------------------------------------------------------- ------------------------------------------------------------- Rate differential 3.40% 3.30% 2.97% Net yield on interest-earning assets $116,862 3.77% $110,386 3.72% $105,601 3.55% - --------------------------------------------------------------------- -------------------------------------------------------------
(1) Interest earned and average rates on obligations of states and political subdivisions are reflected on a tax equivalent basis. Tax equivalent interest earned is : actual interest earned times 145%. The taxable equivalent adjustment has given effect to the disallowance of interest expense deductions, for federal income tax purposes, related to certain tax-free assets. Note: Above table of average volume and rates is reflected on Colonial BancGroup, Inc. consolidated basis. THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
- --------------------------------------------------------------------------------------------------------- Six Months Ended June 30, -------------------------------------------------------------- AVERAGE VOLUME AND RATES (unaudited) 2002 2001 -------------------------------------------------------------- (Dollars in thousands) Average Average Volume Interest Rate Volume Interest Rate - --------------------------------------------------------------------------------------------------------- Assets Loans, net of unearned income $ 9,249,691 $310,335 6.76% $ 9,442,372 $399,351 8.52% Mortgage warehouse lending 849,226 18,516 4.34% 683,843 22,278 6.48% Mortgage loans held for sale 20,375 678 6.66% 17,417 577 6.63% Investment securities and securities available for sale and other interest-earning assets 2,050,716 56,861 5.55% 1,552,829 52,588 6.83% - ----------------------------------------------------------------- --------------------- Total interest-earning assets(1) 12,170,008 $386,390 6.39% 11,696,461 $474,794 8.16% - ----------------------------------------------------------------- --------------------- Nonearning assets 807,817 708,803 - ------------------------------------------------------- ----------- Total assets $12,977,825 $12,405,264 - --------------------------------------------------------------------------------------------------------- Liabilities and Shareholders' Equity: Interest bearing non-time deposits $2,792,918 $18,090 1.31% $ 2,463,154 $35,662 2.92% Time deposits 4,193,988 76,101 3.66% 4,841,376 147,029 6.12% Short-term borrowings 1,737,054 15,797 1.83% 1,678,893 42,823 5.14% Long-term debt 1,872,272 49,153 5.28% 1,348,135 40,156 6.00% - ----------------------------------------------------------------- --------------------- Total interest-bearing liabilities 10,596,232 159,141 3.03% 10,331,558 $265,670 5.18% - ----------------------------------------------------------------- --------------------- Noninterest-bearing demand deposits 1,372,553 1,168,293 Other liabilities 86,181 105,789 ----------- ----------- Total liabilities 12,054,966 11,605,640 Shareholders' equity 922,859 799,624 - ------------------------------------------------------- ----------- Total liabilities and shareholders' equity $12,977,825 $12,405,264 - --------------------------------------------------------------------------------------------------------- Rate differential 3.36% 2.98% Net yield on interest-earning assets $227,249 3.75% $209,124 3.59% - ---------------------------------------------------------------------------------------------------------
(1) Interest earned and average rates on obligations of states and political subdivisions are reflected on a tax equivalent basis. Tax equivalent interest earned is: actual interest earned times 145%. The taxable equivalent adjustment has given effect to the disallowance of interest expense deductions, for federal income tax purposes, related to certain tax-free assets. Note: Above table of average volume and rates is reflected on Colonial BancGroup, Inc. consolidated basis and has been restated to reflect the October 2001 merger with Manufacturers Bancshares accounted for as a pooling of interest. THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES NONPERFORMING ASSETS AND LOAN LOSS RESERVE ANALYSIS (unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------ NONPERFORMING ASSETS June 30, March 31, December 31, September 30, June 30, (Dollars in thousands) 2002 2002 2001 2001 2001 - ------------------------------------------------------------------------------------------------------------------------------------ Nonaccrual loans $39,452 $44,646 $49,675 $58,441 $59,019 Restructured loans 1,206 1,233 1,507 1,125 1,137 Total nonperforming loans 40,658 45,879 51,182 59,566 60,156 Other real estate owned 21,767 21,408 15,553 12,805 10,823 Total nonperforming assets $62,425 $67,287 $66,735 $72,371 $70,979 Aggregate loans contractually past due 90 days for which interest is being accrued $15,583 $19,033 $28,249 $21,095 $20,080 Net charge-offs: Quarter to date $ 4,952 $ 6,333 $ 8,602 $ 9,200 $ 7,366 Year to date $11,285 $ 6,333 $28,724 $20,122 $10,922 - --------------------------------------------------- RATIOS - --------------------------------------------------- Period end: Total nonperforming assets as a percent of net loans and other real estate 0.60% 0.66% 0.64% 0.72% 0.71% Allowance as a percent of nonperforming assets 212% 191% 183% 159% 164% Allowance as a percent of nonperforming loans 325% 281% 239% 194% 194% Net charge-offs as a percent of average net loans (annualized): Quarter to date 0.19% 0.25% 0.34% 0.37% 0.28% Year to date 0.22% 0.25% 0.28% 0.27% 0.22% - ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------- June 30, 2002 March 31, 2002 December 31, 2001 ------------------------------------------------------------------------- Percent Percent Percent ALLOWANCE FOR LOAN LOSSES % BY CATEGORY Loans reserve Loans reserve Loans reserve - ----------------------------------------------------- ---------------------------------- ------------------------------------- Single Family Real Estate: Short Term lines of credit secured by RE loans held for sale $ 929,432 0.25% $ 874,355 0.25% $ 1,286,532 0.25% 1-4 Family real estate portfolio - held to maturity 1,911,882 0.50% 1,942,522 0.50% 1,956,143 0.50% Other 7,528,509 1.60% 7,419,395 1.58% 7,124,990 1.53% ------------- ------------- ------------- Total loans $10,369,823 1.28% $10,236,272 1.26% $10,367,665 1.18% - ------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------- June 30, 2001 ----------------------- Percent ALLOWANCE FOR LOAN LOSSES % BY CATEGORY Loans reserve - ----------------------------------------------------- ----------------------- Single Family Real Estate: Short Term lines of credit secured by RE loans held for sale $ 857,450 0.25% 1-4 Family real estate portfolio - held to maturity 2,212,267 0.50% Other 6,933,674 1.49% ------------- Total loans $10,003,391 1.17% - -----------------------------------------------------------------------------
8-K Supplemental Net Interest Margins - -------------------- The net interest margin improved 5 basis points to 3.77% for the second quarter versus 3.72% for the first quarter of 2002. The margin improvement was due to the 21 basis point decline in rate on interest bearing liabilities versus an 11 basis point decline in the yield on earning assets. A 42 basis point decline in the average rate on time deposits was a principal driver in the decline in the rate on interest bearing liabilities. Growth in core deposits also provided an improved mix of funding costs. The margin improvement may now be topping out at a slightly lower level than previously expected. Most of the CD (certificate of deposits) portfolio has now repriced from the higher rate levels of a year ago. Additionally as CDs have matured, customers have been attracted to the higher rates available on longer maturities. This has increased the rollover rate on CDs and lengthened the average remaining term on the total CD portfolio to 11.8 months at June 30, 2002 compared to 7.5 months at December 31, 2001. Another factor slowing additional margin improvement which is also a function of the steep yield curve is a continued shift to floating rate loans. Higher rate fixed rate loans have been paid off and replaced by lower yielding floating rate loans. Although both of these developments should limit additional margin improvement in a flat rate environment they should provide improvement in a rising rate environment. 1 The following is a schedule of rate sensitive assets and liabilities as of June 30, 2002. 1 month 2 months and less to 1 year 1 year+ -------- --------- ------- ($ in millions): Rate Sensitive Assets $6,420 $1,870 $4,474 ------------------------------------- Rate Sensitive Liabilities Estimated* $ 104 $1,399 $1,417 Contractual 2,676 2,837 2,793 ------------------------------------- Total $2,780 $4,236 $4,210 ------------------------------------- Current Rate/Yields: - -------------------- Rate Sensitive Assets 5.30% 6.84% 6.95% Rate Sensitive Liabilities Estimated* 2.00% 1.53% 1.07% Contractual 2.01% 3.41% 4.82% Total 2.01% 2.79% 3.56% *Estimated liability cashflows are for interest-bearing demand and savings deposits. These deposits may not reprice in these time periods and may not reprice the full amount of any change in market rates. The table shows that Colonial has more assets than liabilities repricing through 12 months making the balance sheet well positioned if rates begin to rise. Loans - ----- Loans for the 2nd quarter consisted of the following: Net Internal (in millions) 3/31/02 Change 6/30/02 -------------------------------------- Mortgage Warehouse loans $ 874 $ 55 $ 929 Single-family real estate 1,943 (31) 1,912 Regional bank loans 7,419 110 7,529 -------------------------------------- Total $10,236 $134 $10,370 -------------------------------------- 2 Annualized loan growth in the second quarter was 5.24%, with 82% of that growth coming from Colonial's regional banks. Acquisitions - ------------ During the second quarter of 2002 BancGroup announced the signing of a definitive agreement to acquire Palm Beach National Holding Company in a stock for stock exchange resulting in a total value of approximately $98 million ($105.5 million including additional capital from the exercise of stock options). As of June 30, 2002, Palm Beach National had approximately $356 million in assets with $286 million in loans and $315 million in deposits, 27% of which are noninterest bearing demand deposits. The acquisition is expected to close late in the third quarter of 2002 with a systems conversion to follow. Earlier estimates of costs savings between $3.5 and 4.5 million annually have not changed. BancGroup also continues to estimate that one time costs associated with the transaction will be between $5.5 and $6.5 million. Core deposit valuation is estimated to be approximately $14.5 million, and is expected to be amortized over 8 years using the straight line method. Future Earnings Outlook - ----------------------- The outlook for the economy remains uncertain. Given this uncertainty, the instability in the stock markets and the lack of inflation, market expectations are that the Federal Reserve will not increase short-term interest rates before year-end. Management believes Colonial's rate sensitivity is positioned such that margins should improve when short term rates increase. As mentioned previously, management does not expect much further improvement in the Company's margin under the current rate scenario. In recent months, pricing competition on both loans and deposits has significantly limited any additional margin improvement. 3 The effect of the current rate environment is expected to cause the warehouse line volume to remain near its current level for the near term, with some seasonal variation. Given the uncertain economic outlook, management expects other loan volumes will grow in the low to mid single digit range. Noninterest expenses should remain under control with a 4-6% growth rate expected considering technology investments currently underway. These investments include improved automation of branch delivery systems, enhanced internet banking and wire transfer systems, an image processing system and continued product refinements. The Company's estimate for 2002 earnings per share ranges from $1.19 to $1.21 and from $1.28 to $1.32 for 2003. 4 -----END PRIVACY-ENHANCED MESSAGE-----