FRME First Merchants Corporation

First Merchants Corporation Announces Record Second Quarter 2017 Results and Franchise Additions

MUNCIE, Ind.--(BUSINESS WIRE)--

First Merchants Corporation (NASDAQ - FRME) reported record second quarter 2017 net income of $24.1 million, compared to $20 million during the second quarter of 2016. Earnings per share for the period totaled a record $.57 per share, an increase of $.08 per share, or 16.3 percent, over the same period in 2016. Year-to-date net income totaled a record $47.3 million, compared to $37.7 million during the same period in 2016. Earnings per share for the six months ended June 30, 2017 totaled a record $1.13 per share, an increase of $.21 per share, or 22.8 percent, over the same period in 2016.

Michael C. Rechin, President and Chief Executive Officer, stated, “First Merchants produced record earnings for the second quarter of 2017. Integrated within our second quarter financial statements was the addition of The Arlington Bank on May 19th to include $232 million of total loans, $253 million of deposits and $2.5 million of one-time acquisition expenses. We are also pleased to have completed the closing of our acquisition of Independent Alliance Banks, Inc. on July 14th.” Rechin added, “Our momentum in organic growth and franchise expansion through acquisitions is very fulfilling. The quarter was very productive, including margin expansion, efficiency gains and leadership team additions. Our focus for the remainder of the year includes successful execution of our two upcoming integrations and welcoming new First Merchants’ clients to the same level of excellent service that our client base has come to expect.”

Total assets reached $7.8 billion as of quarter-end and loans totaled a record $5.6 billion, compared to $6.9 billion and $4.8 billion, as of June 30, 2016, representing increases of 13 and 17.2 percent, respectively. Total deposits reached record levels as well, totaling $6 billion as of June 30, 2017, representing an 11.3 percent increase. Of the increase in total loans and total deposits, The Arlington Bank acquisition represented 4.8 and 4.7 percent, respectively. Tangible common equity also increased to $732 million, or $16.97 per share, compared to $633 million or $15.53 per share as of June 30, 2016.

Net-interest income totaled a record $63.1 million for the quarter and reported net-interest margin increased by 9 basis points over the second quarter of 2016, totaling 3.95 percent. Yields on earning assets totaled 4.44 percent and the cost of supporting liabilities totaled .49 percent. When adjusted for fair value accretion, net-interest margin totaled 3.81 percent for the quarter, an increase of 16 basis points over the second quarter of 2016 and 9 basis points over the first quarter of 2017.

Non-interest income totaled $18.4 million for the quarter, up $2 million from the second quarter of 2016 total of $16.4 million. Earnings on the cash surrender value of life insurance accounted for $1.7 million of the increase.

Non-interest expense totaled $47.3 million for the quarter, an increase of $2.5 million from the second quarter of 2016. The increase was fully attributable to one-time merger related expenses.

The Corporation’s provision expense totaled $2.9 million compared to $790,000 during the same period in 2016. The increase in provision expense provided allowance coverage for organic loan growth. The allowance for loan losses now totals $70.5 million as of June 30, 2017, up from $62.2 million as of June 30, 2016. Non-accrual loans totaled $27.3 million as of quarter-end, down from $33.6 million a year ago. The allowance is 1.25 percent of total loans and 1.45 percent of non-purchased loans.

As of June 30, 2017, the Corporation’s total risk-based capital ratio equaled 14.01 percent, common equity tier 1 capital ratio equaled 11.11 percent, and the tangible common equity ratio totaled 9.68 percent.

CONFERENCE CALL

First Merchants Corporation will conduct a second quarter earnings conference call and web cast at 2:30 p.m. (ET) on Thursday, July 27, 2017.

To participate, dial (Toll Free) 877-507-0578 and reference First Merchants Corporation's second quarter earnings release. International callers please call +1 412-317-1073. A replay of the call will be available until August 27, 2017. To access a replay of the call, US participants should dial (Toll Free) 877-344-7529 or for International participants, dial +1 412-317-0088. The replay passcode is 10107738.

In order to view the web cast and presentation slides, please go to http://services.choruscall.com/links/frme170727.html during the time of the call. A replay of the web cast will be available until July 27, 2018.

Detailed financial results are reported on the attached pages.

About First Merchants Corporation

First Merchants Corporation is a financial holding company headquartered in Muncie, Indiana. The Corporation is comprised of First Merchants Bank, which also operates as Lafayette Bank & Trust, The Arlington Bank and iAB Financial Bank and First Merchants Private Wealth Advisors which operates as a division of First Merchants Bank.

First Merchants Corporation’s common stock is traded on the NASDAQ Global Select Market System under the symbol FRME. Quotations are carried in daily newspapers and can be found on the company’s Internet web page (http://www.firstmerchants.com).

FIRST MERCHANTS and the Shield Logo are federally registered trademarks of First Merchants Corporation.

Forward-Looking Statements

This release contains forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often, but not always, be identified by the use of words like “believe”, “continue”, “pattern”, “estimate”, “project”, “intend”, “anticipate”, “expect” and similar expressions or future or conditional verbs such as “will”, would”, “should”, “could”, “might”, “can”, “may”, or similar expressions. These statements include statements of First Merchants’ goals, intentions and expectations; statements regarding the First Merchants’ business plan and growth strategies; statements regarding the asset quality of First Merchants’ loan and investment portfolios; and estimates of First Merchants’ risks and future costs and benefits. These forward-looking statements are subject to significant risks, assumptions and uncertainties that may cause results to differ materially from those set forth in forward-looking statements, including, among other things: possible changes in monetary and fiscal policies, and laws and regulations; the effects of easing restrictions on participants in the financial services industry; the cost and other effects of legal and administrative cases; possible changes in the credit worthiness of customers and the possible impairment of collectability of loans; fluctuations in market rates of interest; competitive factors in the banking industry; changes in the banking legislation or regulatory requirements of federal and state agencies applicable to bank holding companies and banks like First Merchants’ affiliate bank; continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; changes in market, economic, operational, liquidity, credit and interest rate risks associated with the First Merchants’ business; and other risks and factors identified in each of First Merchants’ filings with the Securities and Exchange Commission. First Merchants does not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this press release. In addition, First Merchants’ past results of operations do not necessarily indicate its anticipated future results.

       
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands) June 30,
2017 2016
ASSETS
Cash and cash equivalents $ 142,650 $ 120,471
Interest-bearing time deposits 48,305 62,533
Investment securities 1,343,323 1,297,801
Loans held for sale 4,036 18,854
Loans 5,613,144 4,791,429
Less: Allowance for loan losses (70,471 ) (62,186 )
Net loans 5,542,673 4,729,243
Premises and equipment 92,637 95,170
Federal Home Loan Bank stock 19,015 18,096
Interest receivable 27,597 23,351
Core deposit intangibles and goodwill 309,686 260,821
Cash surrender value of life insurance 200,125 201,417
Other real estate owned 11,893 13,219
Tax asset, deferred and receivable 27,331 32,547
Other assets 35,758   32,895  
TOTAL ASSETS $ 7,805,029   $ 6,906,418  
LIABILITIES
Deposits:
Noninterest-bearing $ 1,398,237 $ 1,253,747
Interest-bearing 4,618,867   4,153,807  
Total Deposits 6,017,104 5,407,554
Borrowings:
Federal funds purchased 134,608 20,000
Securities sold under repurchase agreements 127,884 140,777
Federal Home Loan Bank advances 312,715 268,579
Subordinated debentures and term loans 128,742   127,678  
Total Borrowings 703,949 557,034
Interest payable 3,477 3,051
Other liabilities 45,383   51,229  
Total Liabilities 6,769,913 6,018,868
STOCKHOLDERS' EQUITY
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 shares
Issued and outstanding - 125 shares 125 125
Common Stock, $.125 stated value:
Authorized -- 100,000,000 and 50,000,000 shares (1)
Issued and outstanding - 43,153,509 and 40,772,896 shares 5,394 5,097
Additional paid-in capital 593,904 505,725
Retained earnings 434,309 369,568
Accumulated other comprehensive loss 1,384   7,035  
Total Stockholders' Equity 1,035,116   887,550  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 7,805,029   $ 6,906,418  

(1) On May 1, 2017, the shareholders of First Merchants Corporation approved an amendment to the Articles of Incorporation to increase the number of shares of common stock authorized to issue from 50,000,000 to 100,000,000 shares.

   
CONSOLIDATED STATEMENTS OF INCOME Three Months Ended Six Months Ended
(Dollars In Thousands, Except Per Share Amounts) June 30, June 30,
2017   2016 2017   2016
INTEREST INCOME
Loans receivable:
Taxable $ 59,386 $ 52,099 $ 115,743 $ 102,588
Tax-exempt 2,492 1,465 4,825 2,780
Investment securities:
Taxable 4,180 4,202 8,488 8,530
Tax-exempt 5,091 4,583 10,094 9,092
Deposits with financial institutions 114 122 158 228
Federal Reserve and Federal Home Loan Bank stock 204   233   393   713
Total Interest Income 71,467   62,704   139,701   123,931
INTEREST EXPENSE
Deposits 5,137 4,039 9,261 8,102
Federal funds purchased 103 7 331 35
Securities sold under repurchase agreements 110 92 198 192
Federal Home Loan Bank advances 1,177 818 2,155 1,614
Subordinated debentures and term loans 1,840   1,786   3,657   3,571
Total Interest Expense 8,367   6,742   15,602   13,514
NET INTEREST INCOME 63,100 55,962 124,099 110,417
Provision for loan losses 2,875   790   5,260   1,340
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 60,225   55,172   118,839   109,077
OTHER INCOME
Service charges on deposit accounts 4,438 4,416 8,612 8,561
Fiduciary activities 2,609 2,376 5,249 4,870
Other customer fees 5,406 4,695 10,269 9,754
Earnings on cash surrender value of life insurance 2,971 1,297 3,869 2,773
Net gains and fees on sales of loans 1,617 1,717 2,892 3,177
Net realized gains on sales of available for sale securities 567 706 1,165 1,703
Other income 826   1,178   1,224   1,384
Total Other Income 18,434   16,385   33,280   32,222
OTHER EXPENSES
Salaries and employee benefits 27,076 25,570 52,808 52,907
Net occupancy 3,965 4,059 8,181 8,081
Equipment 2,907 3,243 5,714 6,481
Marketing 792 851 1,357 1,588
Outside data processing fees 3,086 2,025 5,702 4,094
Printing and office supplies 275 369 539 733
Core deposit amortization 991 977 1,894 1,955
FDIC assessments 579 1,002 1,149 1,952
Other real estate owned and foreclosure expenses 731 915 1,262 1,666
Professional and other outside services 3,266 1,478 5,000 3,640
Other expenses 3,648   4,346   6,809   8,213
Total Other Expenses 47,316   44,835   90,415   91,310
INCOME BEFORE INCOME TAX 31,343 26,722 61,704 49,989
Income tax expense 7,207   6,716   14,375   12,290
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $ 24,136   $ 20,006   $ 47,329   $ 37,699
 
Per Share Data:
Basic Net Income Available to Common Stockholders $ 0.57 $ 0.50 $ 1.14 $ 0.93
Diluted Net Income Available to Common Stockholders $ 0.57 $ 0.49 $ 1.13 $ 0.92
Cash Dividends Paid $ 0.18 $ 0.14 $ 0.33 $ 0.25
Average Diluted Shares Outstanding (in thousands) 42,244 40,969 41,735 40,941
 
       
FINANCIAL HIGHLIGHTS
(Dollars in thousands) Three Months Ended Six Months Ended
June 30, June 30,
2017 2016 2017 2016
NET CHARGE-OFFS $ 629 $ 690 $ 826 $ 1,607
 
AVERAGE BALANCES:
Total Assets $ 7,571,789 $ 6,857,839 $ 7,395,450 $ 6,800,577
Total Loans 5,436,961 4,739,079 5,309,311 4,704,323
Total Earning Assets 6,812,451 6,131,438 6,670,358 6,075,878
Total Deposits 5,930,532 5,440,148 5,761,384 5,368,719
Total Stockholders' Equity 983,096 876,116 948,769 868,884
 
FINANCIAL RATIOS:
Return on Average Assets 1.28 % 1.17 % 1.28 % 1.11 %
Return on Average Stockholders' Equity 9.82 9.13 9.98 8.68
Return on Average Common Stockholders' Equity 9.82 9.14 9.98 8.68
Average Earning Assets to Average Assets 89.97 89.41 90.20 89.34
Allowance for Loan Losses as % of Total Loans 1.25 1.29 1.25 1.29
Net Charge-offs as % of Average Loans (Annualized) 0.05 0.06 0.03 0.07
Average Stockholders' Equity to Average Assets 12.98 12.78 12.83 12.78
Tax Equivalent Yield on Earning Assets 4.44 4.30 4.43 4.29
Cost of Supporting Liabilities 0.49 0.44 0.47 0.44
Net Interest Margin (FTE) on Earning Assets 3.95 3.86 3.96 3.85
Efficiency Ratio 53.61 57.33 53.13 59.52
Tangible Common Book Value Per Share $ 16.97 $ 15.53 $ 16.97 $ 15.53
 
         
NON-PERFORMING ASSETS
(Dollars In Thousands) June 30, March 31, December 31, September 30, June 30,
2017 2017 2016 2016 2016
Non-Accrual Loans $ 27,347 $ 27,920 $ 29,998 $ 34,105 $ 33,565
Renegotiated Loans 384   876   4,747   3,940   4,299  
Non-Performing Loans (NPL) 27,731 28,796 34,745 38,045 37,864
Other Real Estate Owned 11,893   8,293   8,966   10,242   13,219  
Non-Performing Assets (NPA) 39,624 37,089 43,711 48,287 51,083
90+ Days Delinquent 634   123   112   1,625   362  
NPAs & 90 Day Delinquent $ 40,258   $ 37,212   $ 43,823   $ 49,912   $ 51,445  
 
Allowance for Loan Losses $ 70,471 $ 68,225 $ 66,037 $ 63,456 $ 62,186
Quarterly Net Charge-offs 629 197 (164 ) 630 690
NPAs / Actual Assets % 0.51 % 0.51 % 0.61 % 0.69 % 0.74 %
NPAs & 90 Day / Actual Assets % 0.52 % 0.51 % 0.61 % 0.71 % 0.74 %
NPAs / Actual Loans and OREO % 0.70 % 0.70 % 0.85 % 0.97 % 1.06 %
Allowance for Loan Losses / Actual Loans (%) 1.25 % 1.29 % 1.28 % 1.28 % 1.29 %
Net Charge-offs as % of Average Loans (Annualized) 0.05 % 0.02 % (0.01 )% 0.05 % 0.06 %
 
         
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands) June 30, March 31, December 31, September 30, June 30,
2017 2017 2016 2016 2016
ASSETS
Cash and cash equivalents $ 142,650 $ 104,247 $ 127,927 $ 99,602 $ 120,471
Interest-bearing time deposits 48,305 20,439 24,459 33,803 62,533
Investment securities 1,343,323 1,327,217 1,304,505 1,300,428 1,297,801
Loans held for sale 4,036 1,262 2,929 1,482 18,854
Loans 5,613,144 5,274,909 5,139,645 4,973,844 4,791,429
Less: Allowance for loan losses (70,471 ) (68,225 ) (66,037 ) (63,456 ) (62,186 )
Net loans 5,542,673 5,206,684 5,073,608 4,910,388 4,729,243
Premises and equipment 92,637 91,311 94,432 95,540 95,170
Federal Home Loan Bank stock 19,015 17,964 17,964 18,044 18,096
Interest receivable 27,597 25,174 26,194 23,652 23,351
Core deposit intangibles and goodwill 309,686 257,963 258,866 259,844 260,821
Cash surrender value of life insurance 200,125 202,574 201,671 201,856 201,417
Other real estate owned 11,893 8,293 8,966 10,242 13,219
Tax asset, deferred and receivable 27,331 32,074 39,384 31,779 32,547
Other assets 35,758   30,991   30,706   35,692   32,895  
TOTAL ASSETS $ 7,805,029   $ 7,326,193   $ 7,211,611   $ 7,022,352   $ 6,906,418  
LIABILITIES
Deposits:
Noninterest-bearing $ 1,398,237 $ 1,373,778 $ 1,348,267 $ 1,307,886 $ 1,253,747
Interest-bearing 4,618,867   4,261,531   4,208,231   4,136,354   4,153,807  
Total Deposits 6,017,104 5,635,309 5,556,498 5,444,240 5,407,554
Borrowings:
Federal funds purchased 134,608 102,000 120,349 58,358 20,000
Securities sold under repurchase agreements 127,884 139,007 146,480 138,671 140,777
Federal Home Loan Bank advances 312,715 338,919 298,923 297,022 268,579
Subordinated debentures and term loans 128,742   128,862   128,445   128,288   127,678  
Total Borrowings 703,949 708,788 694,197 622,339 557,034
Interest payable 3,477 3,875 3,110 3,733 3,051
Other liabilities 45,383   48,751   56,149   51,175   51,229  
Total Liabilities 6,769,913 6,396,723 6,309,954 6,121,487 6,018,868
STOCKHOLDERS' EQUITY
Cumulative Preferred Stock, $1,000 par value, $1,000 liquidation value:
Authorized -- 600 shares
Issued and outstanding 125 125 125 125 125
Common Stock, $.125 stated value:
Authorized -- 100,000,000 and 50,000,000 shares (1)
Issued and outstanding 5,394 5,131 5,114 5,100 5,097
Additional paid-in capital 593,904 509,953 509,018 506,848 505,725
Retained earnings 434,309 417,983 400,981 384,868 369,568
Accumulated other comprehensive income (loss) 1,384   (3,722 ) (13,581 ) 3,924   7,035  
Total Stockholders' Equity 1,035,116   929,470   901,657   900,865   887,550  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 7,805,029   $ 7,326,193   $ 7,211,611   $ 7,022,352   $ 6,906,418  

(1) On May 1, 2017, the shareholders of First Merchants Corporation approved an amendment to the Articles of Incorporation to increase the number of shares of common stock authorized to issue from 50,000,000 to 100,000,000 shares.

         
CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands, Except Per Share Amounts) June 30, March 31, December 31, September 30, June 30,
2017 2017 2016 2016 2016
INTEREST INCOME
Loans receivable:
Taxable $ 59,386 $ 56,357 $ 53,895 $ 53,819 $ 52,099
Tax-exempt 2,492 2,333 2,096 1,649 1,465
Investment securities:
Taxable 4,180 4,308 3,893 3,992 4,202
Tax-exempt 5,091 5,003 4,862 4,668 4,583
Deposits with financial institutions 114 44 67 55 122
Federal Reserve and Federal Home Loan Bank stock 204   189   192   193   233  
Total Interest Income 71,467   68,234   65,005   64,376   62,704  
INTEREST EXPENSE
Deposits 5,137 4,124 3,886 3,926 4,039
Federal funds purchased 103 228 40 27 7
Securities sold under repurchase agreements 110 88 91 91 92
Federal Home Loan Bank advances 1,177 978 797 853 818
Subordinated debentures and term loans 1,840   1,817   1,817   1,797   1,786  
Total Interest Expense 8,367   7,235   6,631   6,694   6,742  
NET INTEREST INCOME 63,100 60,999 58,374 57,682 55,962
Provision for loan losses 2,875   2,385   2,417   1,900   790  
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 60,225   58,614   55,957   55,782   55,172  
OTHER INCOME
Service charges on deposit accounts 4,438 4,174 4,534 4,667 4,416
Fiduciary activities 2,609 2,640 2,500 2,448 2,376
Other customer fees 5,406 4,863 4,784 4,777 4,695
Earnings on cash surrender value of life insurance 2,971 898 886 614 1,297
Net gains and fees on sales of loans 1,617 1,275 1,886 1,989 1,717
Net realized gains on sales of available for sale securities 567 598 847 839 706
Other income 826   398   683   1,527   1,178  
Total Other Income 18,434   14,846   16,120   16,861   16,385  
OTHER EXPENSES
Salaries and employee benefits 27,076 25,732 22,994 26,651 25,570
Net occupancy 3,965 4,216 4,568 4,348 4,059
Equipment 2,907 2,807 3,069 2,947 3,243
Marketing 792 565 790 630 851
Outside data processing fees 3,086 2,616 2,672 2,382 2,025
Printing and office supplies 275 264 301 314 369
Core deposit amortization 991 903 977 978 977
FDIC assessments 579 570 550 534 1,002
Other real estate owned and foreclosure expenses 731 531 574 637 915
Professional and other outside services 3,266 1,734 1,634 1,242 1,478
Other expenses 3,648   3,161   3,805   3,452   4,346  
Total Other Expenses 47,316   43,099   41,934   44,115   44,835  
INCOME BEFORE INCOME TAX 31,343 30,361 30,143 28,528 26,722
Income tax expense 7,207   7,168   7,850   7,469   6,716  
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $ 24,136   $ 23,193   $ 22,293   $ 21,059   $ 20,006  
 
Per Share Data:
Basic Net Income Available to Common Stockholders $ 0.57 $ 0.57 $ 0.55 $ 0.51 $ 0.50
Diluted Net Income Available to Common Stockholders $ 0.57 $ 0.56 $ 0.55 $ 0.51 $ 0.49
Cash Dividends Paid $ 0.18 $ 0.15 $ 0.15 $ 0.14 $ 0.14
Average Diluted Shares Outstanding (in thousands) 42,244 41,221 41,124 41,026 40,969
FINANCIAL RATIOS:
Return on Average Assets 1.28 % 1.29 % 1.26 % 1.22 % 1.17 %
Return on Average Stockholders' Equity 9.82 10.15 9.87 9.39 9.13
Return on Average Common Stockholders' Equity 9.82 10.15 9.87 9.39 9.14
Average Earning Assets to Average Assets 89.97 90.43 89.86 89.73 89.41
Allowance for Loan Losses as % of Total Loans 1.25 1.29 1.28 1.28 1.29
Net Charge-offs as % of Average Loans (Annualized) 0.05 0.02 (0.01 ) 0.05 0.06
Average Stockholders' Equity to Average Assets 12.98 12.67 12.75 12.99 12.78
Tax Equivalent Yield on Earning Assets 4.44 4.42 4.32 4.37 4.30
Cost of Supporting Liabilities 0.49 0.44 0.42 0.43 0.44
Net Interest Margin (FTE) on Earning Assets 3.95 3.98 3.90 3.94 3.86
Efficiency Ratio 53.61 52.61 52.18 55.12 57.33
Tangible Common Book Value Per Share $ 16.97 $ 16.49 $ 15.85 $ 15.86 $ 15.53
 
         
LOANS
(Dollars In Thousands) June 30, March 31, December 31, September 30, June 30,
2017 2017 2016 2016 2016
Commercial and industrial loans $ 1,289,884 $ 1,258,840 $ 1,194,646 $ 1,146,538 $ 1,084,890
Agricultural production financing and other loans to farmers 75,746 77,021 79,689 93,169 95,131
Real estate loans:
Construction 442,389 336,931 418,703 368,241 352,980
Commercial and farmland 2,167,729 2,118,431 1,953,062 1,941,739 1,869,703
Residential 847,580 737,918 739,169 739,855 758,870
Home equity 436,038 423,708 418,525 398,837 374,159
Individuals' loans for household and other personal expenditures 79,887 77,590 77,479 76,497 75,205
Lease financing receivables, net of unearned income 232 261 311 380 388
Other commercial loans 273,659   244,209   258,061   208,588   180,103  
Loans 5,613,144 5,274,909 5,139,645 4,973,844 4,791,429
Allowance for loan losses (70,471 ) (68,225 ) (66,037 ) (63,456 ) (62,186 )
NET LOANS $ 5,542,673   $ 5,206,684   $ 5,073,608   $ 4,910,388   $ 4,729,243  
 
         
DEPOSITS
(Dollars In Thousands) June 30, March 31, December 31, September 30, June 30,
2017 2017 2016 2016 2016
Demand deposits $ 3,015,846 $ 2,861,384 $ 2,866,853 $ 2,745,028 $ 2,717,500
Savings deposits 1,708,478 1,565,174 1,560,752 1,545,372 1,551,210
Certificates and other time deposits of $100,000 or more 362,589 312,327 276,274 296,838 301,695
Other certificates and time deposits 511,935 476,741 471,247 498,203 517,720
Brokered deposits 418,256   419,683   381,372   358,799   319,429
TOTAL DEPOSITS $ 6,017,104   $ 5,635,309   $ 5,556,498   $ 5,444,240   $ 5,407,554
 
             
NET INTEREST INCOME
(Dollars in Thousands) For the Three Months Ended
June 30, 2017 June 30, 2016
Interest Interest
Average Income / Average Average Income / Average
Balance Expense Rate Balance Expense Rate
Assets:
Interest-bearing time deposits $ 42,794 $ 114 1.07 % $ 99,734 $ 122 0.49 %
Federal Reserve and Federal Home Loan Bank stock 18,655 204 4.37 23,442 233 3.98
Investment Securities: (1)
Taxable 717,818 4,180 2.33 730,179 4,202 2.30
Tax-Exempt (2) 596,223   7,832   5.25 539,004   7,050   5.23
Total Investment Securities 1,314,041   12,012   3.66 1,269,183   11,252   3.55
Loans held for sale 3,791 65 6.86 3,664 96 10.48
Loans: (3)
Commercial 3,911,477 45,400 4.64 3,501,919 40,501 4.63
Real Estate Mortgage 647,032 7,229 4.47 568,746 6,116 4.30
Installment 546,339 6,692 4.90 470,254 5,386 4.58
Tax-Exempt (2) 328,322   3,834   4.67 194,496   2,254   4.64
Total Loans 5,436,961   63,220   4.65 4,739,079   54,353   4.59
Total Earning Assets 6,812,451 75,550   4.44 6,131,438 65,960   4.30
Net unrealized gain on securities available for sale 4,908 10,924
Allowance for loan losses (69,068 ) (62,235 )
Cash and cash equivalents 153,247 104,372
Premises and equipment 92,026 96,620
Other assets 578,225   576,720  
Total Assets $ 7,571,789   $ 6,857,839  
Liabilities:
Interest-bearing deposits:
Interest-bearing NOW deposits $ 1,596,182 $ 1,089 0.27 % $ 1,429,191 $ 637 0.18 %
Money market deposits 901,077 600 0.27 849,270 502 0.24
Savings deposits 791,464 161 0.08 717,044 149 0.08
Certificates and other time deposits 1,281,132   3,287   1.03 1,159,247   2,751   0.95
Total Interest-bearing Deposits 4,569,855 5,137 0.45 4,154,752 4,039 0.39
Borrowings 618,335   3,230   2.09 476,852   2,703   2.27
Total Interest-bearing Liabilities 5,188,190 8,367 0.65 4,631,604 6,742 0.58
Noninterest-bearing deposits 1,360,677 1,285,396
Other liabilities 39,826   64,723  
Total Liabilities 6,588,693 5,981,723
Stockholders' Equity 983,096     876,116    
Total Liabilities and Stockholders' Equity $ 7,571,789   8,367   0.49 $ 6,857,839   6,742   0.44
Net Interest Income $ 67,183   $ 59,218  
Net Interest Margin 3.95 % 3.86 %
(1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments.
(2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 35 percent for 2017 and 2016. These totals equal $4,083 and $3,256 for the three months ended June 30, 2017 and 2016, respectively.
(3) Non accruing loans have been included in the average balances.
 
           
NET INTEREST INCOME
(Dollars in Thousands) For the Six Months Ended
June 30, 2017 June 30, 2016
Interest Interest
Average Income / Average Average Income / Average
Balance Expense Rate Balance Expense Rate
Assets:
Interest-bearing time deposits $ 36,662 $ 158 0.86 % $ 87,722 $ 228 0.52 %
Federal Reserve and Federal Home Loan Bank stock 18,312 393 4.29 30,537 713 4.67
Investment Securities: (1)
Taxable 714,672 8,488 2.38 723,333 8,530 2.36
Tax-Exempt (2) 591,401   15,529   5.25 529,963   13,987   5.28
Total Investment Securities 1,306,073   24,017   3.68 1,253,296   22,517   3.59
Loans held for sale 3,197 109 6.82 4,956 218 8.80
Loans: (3)
Commercial 3,846,622 89,494 4.65 3,475,684 79,365 4.57
Real Estate Mortgage 596,990 13,350 4.47 572,006 12,510 4.37
Installment 539,272 12,790 4.74 463,454 10,495 4.53
Tax-Exempt (2) 323,230   7,423   4.59 188,223   4,277   4.54
Total Loans 5,309,311   123,166   4.64 4,704,323   106,865   4.54
Total Earning Assets 6,670,358 147,734   4.43 % 6,075,878 130,323   4.29 %
Net unrealized gain on securities available for sale 2,762 10,464
Allowance for loan losses (68,007 ) (62,724 )
Cash and cash equivalents 128,768 103,143
Premises and equipment 92,519 96,659
Other assets 569,050   577,157  
Total Assets $ 7,395,450   $ 6,800,577  
Liabilities:
Interest-bearing deposits:
Interest-bearing NOW deposits $ 1,554,740 $ 1,926 0.25 % $ 1,364,729 $ 1,181 0.17 %
Money market deposits 845,536 941 0.22 857,601 993 0.23
Savings deposits 784,033 317 0.08 703,174 284 0.08
Certificates and other time deposits 1,223,426   6,077   0.99 1,172,852   5,644   0.96
Total Interest-bearing Deposits 4,407,735 9,261 0.42 4,098,356 8,102 0.40
Borrowings 641,499   6,341   1.98 498,470   5,412   2.17
Total Interest-bearing Liabilities 5,049,234 15,602   0.62 4,596,826 13,514 0.59
Noninterest-bearing deposits 1,353,649 1,270,363
Other liabilities 43,798   64,504  
Total Liabilities 6,446,681 5,931,693
Stockholders' Equity 948,769     868,884    
Total Liabilities and Stockholders' Equity $ 7,395,450   15,602   0.47 $ 6,800,577   13,514   0.44
Net Interest Income $ 132,132   $ 116,809  
Net Interest Margin 3.96 % 3.85 %
(1) Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments.
(2) Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 35 percent for 2017 and 2016. These totals equal $8,033 and $6,392 for the six months ended June 30, 2017 and 2016, respectively.
(3) Non accruing loans have been included in the average balances.

EN
27/07/2017

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