Associated Reports Second Quarter Earnings of $0.28 per share

Earnings per share up 16.7% from a year ago

Jul 18, 2013, 16:05 ET from Associated Banc-Corp

GREEN BAY, Wis., July 18, 2013 /PRNewswire/ -- Associated Banc-Corp (NASDAQ: ASBC) today reported net income to common shareholders of $47 million, or $0.28 per common share, for the quarter ended June 30, 2013. This compares to net income to common shareholders of $42 million, or $0.24 per common share, for the quarter ended June 30, 2012.

"We are pleased to report another quarter of solid results and continue to look for opportunities to deliver value for our shareholders," said President and CEO Philip B. Flynn.  "Our mortgage banking business had a record quarter and we are encouraged by momentum being created in our other lines of business. We remain focused on strengthening our franchise and deploying our capital in a disciplined manner, consistent with our commitment to building long-term shareholder value at Associated."

HIGHLIGHTS   

  • Net income to common shareholders of $47 million, up 10.9% from the prior year period
    • Quarterly earnings have improved 10 consecutive quarters
  • Return on Tier 1 common equity for the quarter was 9.9%, compared to 9.3% for the prior year period
  • Average loan balances increased by $280 million, or 2% from the first quarter and have increased $1.1 billion, or 8% from a year ago
    • Average total commercial loan balances grew by 4% from the first quarter and accounted for the majority of this quarter's average loan growth
  • Average deposits for the second quarter increased by $2.1 billion, or 14% from a year ago to $17.1 billion
    • Checking and savings deposits continued to grow
  • Credit quality continued to improve with net charge offs, nonaccrual loans, and potential problem loans all declining quarter over quarter
  • During the second quarter, the Company repurchased $30 million, or approximately 2 million shares, of common stock at an average cost of $15.09.
  • Capital ratios remain very strong with a Tier 1 common equity ratio of 11.48%

SECOND QUARTER 2013 FINANCIAL RESULTS

Loans

Average loans of $15.7 billion increased by $280 million, or 2% from the first quarter and increased $1.1 billion, or 8%, from the year ago quarter. Commercial and business lending average balances increased by $245 million, or 4% from the prior quarter.  Commercial real estate lending average balances grew by $130 million, or 4% on a linked-quarter basis.  The residential mortgage portfolio average balances grew by $39 million, or 1%, during the quarter.  This growth was partially offset by continued run off in home equity and installment loan balances, which experienced an average balance decline of $135 million, or 5%, during the quarter.

Deposits

Average deposits of $17.1 billion were relatively flat compared to the first quarter but have increased by $2.1 billion, or 14%, from the year ago quarter.  During the second quarter, average balance growth in checking and savings deposits were offset by a 2% decline in money market deposits coupled with the continued decline in time deposits.

Net Interest Income and Net Interest Margin

Second quarter net interest income of $160 million increased $2 million, or 2% compared to the prior quarter and $6 million, or 4% compared to the year ago quarter. 

Second quarter net interest margin was 3.16%, a slight decrease of 1 basis point from the 3.17% reported in first quarter and a decrease of 14 basis points from a year ago.  The decrease from the first quarter was the result of a 5 basis point decline in asset yields which was offset by 4 basis points of liability cost management actions. 

Noninterest Income and Expense

Noninterest income for the quarter was $84 million, up $2 million, or 3%, from the first quarter and grew $8 million or 11% from the year ago quarter.   Trust fees, service charges, non-deposit fees, and brokerage commissions all improved during the quarter.  However, core fee revenue was flat to the prior quarter as these improvements were offset by a $3 million reserve related to third party insurance products sold in prior years.  Mortgage banking income increased $1 million from the prior quarter as an increase of $3 million in mortgage servicing rights valuation allowance recoveries ($8 million in second quarter compared to $5 million in the first quarter) was partially offset by $2 million in lower gain on sales.   The $1 million decline in asset gains and losses was primarily related to a $2 million real estate write down as the Company continues to identify cost efficiency opportunities within its footprint.

Total noninterest expense for the quarter ended June 30, 2013 was $170 million, up $3 million, or 2%, from the first quarter.  Personnel expense increased $2 million from the first quarter, including $1 million of severance charges related to our on-going consolidation and efficiency efforts.   Losses other than loans were $2 million higher than the first quarter due to increases in unfunded commitment reserves.    The efficiency ratio continued to improve during the period reflecting management's focus on expense management.

Credit

The Company reported another quarter of improving credit quality with nonaccrual loans down 4%, to $217 million compared to the first quarter, and down 32% from a year ago.  The ratio of nonaccrual loans to total loans now stands at 1.38% and has improved for the 13th consecutive quarter.

Net charge offs of $14 million for the second quarter were down slightly from the first quarter, and were $10 million lower than a year ago. 

Second quarter provision for loan losses was $4 million, equal to the first quarter.  The Company's allowance for loan losses was $277 million, representing an allowance equal to 1.76% of loans and representing a coverage ratio of over 127% of nonaccrual loans at June 30, 2013.

Capital Ratios

The Company's capital position remains very strong, with a Tier 1 common equity ratio of 11.48% at June 30, 2013.  The Company's capital ratios continue to be well in excess of both current and proposed "well-capitalized" regulatory benchmarks.

SECOND QUARTER 2013 EARNINGS RELEASE CONFERENCE CALL

The Company will host a conference call for investors and analysts at 4:00 p.m. Central Time (CT) today, July 18, 2013.  Interested parties can listen to the call live on the Internet through the investor relations section of the company's website, http://investor.associatedbank.com or by dialing 888-317-6016. The slide presentation for the call will be available on the company's website just prior to the call. The number for international callers is 412-317-6016. Participants should ask the operator for the Associated Banc-Corp second quarter 2013 earnings call.

An audio archive of the webcast will be available on the company's website at http://investor.associatedbank.com.  A telephone replay will be available one hour after the completion of the call through 8:00 a.m. CT on August 19, 2013, by dialing 877-344-7529 and entering the conference ID number 10030196. The replay number for international callers is 412-317-0088.

ABOUT ASSOCIATED BANC-CORP

Associated Banc-Corp (NASDAQ: ASBC) has total assets of $24 billion and is one of the top 50, publicly traded, U.S. bank holding companies.  Headquartered in Green Bay, Wis., Associated is a leading Midwest banking franchise, offering a full range of financial products and services through approximately 240 banking locations serving more than 150 communities throughout Wisconsin, Illinois and Minnesota, and commercial financial services in Indiana, Michigan, Missouri, Ohio and Texas. Associated Bank, N.A. is an Equal Housing Lender, Equal Opportunity Lender and Member FDIC.  More information about Associated Banc-Corp is available at www.associatedbank.com.

FORWARD LOOKING STATEMENTS

Statements made in this document which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management's plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance.  Such forward-looking statements may be identified by the use of words such as "believe", "expect", "anticipate", "plan", "estimate", "should", "will", "intend", "outlook", or similar expressions.  Forward-looking statements are based on current management expectations and, by their nature, are subject to risks and uncertainties. Actual results may differ materially from those contained in the forward-looking statements.  Factors which may cause actual results to differ materially from those contained in such forward-looking statements include those identified in the Company's most recent Form 10-K and subsequent SEC filings.  Such factors are incorporated herein by reference. 

Investor Contact:

Brian Klaus, Senior Vice President, Investor Relations

920-491-7059

 

Media Contact:

Autumn Latimore, Senior Vice President, Public Relations

414-278-1860

Consolidated Balance Sheets (Unaudited)

Associated Banc-Corp

June 30,

March 31,

Seql Qtr

December 31,

September 30,

June 30,

Comp Qtr

(in thousands)

2013

2013

$ Change

2012

2012

2012

$ Change

Assets

Cash and due from banks

$      422,779

$    336,247

$    86,532

$      563,304

$      419,529

$      414,760

$        8,019

Interest-bearing deposits in other

 financial institutions

121,390

82,555

38,835

147,434

531,303

180,050

(58,660)

Federal funds sold and securities purchased

 under agreements to resell

10,800

8,600

2,200

27,135

2,460

3,800

7,000

Securities held to maturity, at amortized cost

75,946

54,123

21,823

39,877

21,852

-

75,946

Securities available for sale, at fair value

4,854,319

4,950,317

(95,998)

4,926,758

4,496,198

4,521,436

332,883

Federal Home Loan Bank and Federal 

   Reserve Bank stocks, at cost

181,008

152,490

28,518

166,774

166,100

176,041

4,967

Loans held for sale

203,576

173,389

30,187

261,410

157,093

157,481

46,095

Loans

15,746,599

15,551,562

195,037

15,411,022

14,966,214

14,698,902

1,047,697

Allowance for loan losses

(277,218)

(286,923)

9,705

(297,409)

(315,150)

(332,658)

55,440

    Loans, net

15,469,381

15,264,639

204,742

15,113,613

14,651,064

14,366,244

1,103,137

Premises and equipment, net

258,903

254,674

4,229

253,958

238,756

225,245

33,658

Goodwill

929,168

929,168

-

929,168

929,168

929,168

-

Other intangible assets, net

74,612

66,294

8,318

61,176

61,294

64,812

9,800

Trading assets

49,732

65,014

(15,282)

70,711

76,159

73,484

(23,752)

Other assets

965,330

940,258

25,072

926,417

987,378

968,579

(3,249)

    Total assets

$ 23,616,944

23,277,768

$  339,176

$ 23,487,735

$ 22,738,354

$ 22,081,100

$ 1,535,844

Liabilities and Stockholders' Equity

Noninterest-bearing demand deposits

$   4,259,776

4,453,109

$(193,333)

$   4,759,556

$   4,320,437

$   3,874,429

$    385,347

Interest-bearing deposits

12,872,660

12,968,185

(95,525)

12,180,309

12,130,155

11,232,442

1,640,218

    Total deposits

17,132,436

17,421,294

(288,858)

16,939,865

16,450,592

15,106,871

2,025,565

Federal funds purchased and securities sold

 under agreements to repurchase

545,740

730,855

(185,115)

750,455

1,138,027

1,253,270

(707,530)

Other short-term funding

2,218,760

1,038,697

1,180,063

1,576,484

615,258

1,400,000

818,760

Long-term funding

614,822

915,063

(300,241)

1,015,346

1,305,422

1,150,729

(535,907)

Trading liabilities

52,598

70,236

(17,638)

76,343

82,861

80,107

(27,509)

Accrued expenses and other liabilities

175,612

165,358

10,254

192,843

195,742

180,502

(4,890)

    Total liabilities

20,739,968

20,341,503

398,465

20,551,336

19,787,902

19,171,479

1,568,489

Stockholders' Equity

  Preferred equity

63,272

63,272

-

63,272

63,272

63,272

-

  Common stock

1,750

1,750

-

1,750

1,750

1,750

-

  Surplus

1,610,243

1,605,966

4,277

1,602,136

1,599,070

1,594,995

15,248

  Retained earnings

1,330,737

1,297,692

33,045

1,281,811

1,250,189

1,213,735

117,002

  Accumulated other comprehensive income (loss)

(25,015)

42,991

(68,006)

48,603

67,303

66,579

(91,594)

  Treasury stock

(104,011)

(75,406)

(28,605)

(61,173)

(31,132)

(30,710)

(73,301)

    Total stockholders' equity

2,876,976

2,936,265

(59,289)

2,936,399

2,950,452

2,909,621

(32,645)

    Total liabilities and stockholders' equity

$ 23,616,944

23,277,768

$  339,176

$ 23,487,735

$ 22,738,354

$ 22,081,100

$ 1,535,844

Consolidated Statements of Income (Unaudited)

Associated Banc-Corp

For The Three Months Ended

For The Six Months Ended

June 30,

Quarter

June 30,

Year-to-Date

(in thousands, except per share amounts)

2013

2012

$ Change

% Change

2013

2012

$ Change

% Change

Interest Income

Interest and fees on loans

$ 146,896

$ 147,188

$    (292)

(0.2%)

$ 292,423

$ 296,211

$ (3,788)

(1.3%)

Interest and dividends on investment securities:

  Taxable

21,446

23,000

(1,554)

(6.8%)

43,059

46,029

(2,970)

(6.5%)

  Tax-exempt

6,785

7,135

(350)

(4.9%)

13,750

14,409

(659)

(4.6%)

Other interest 

1,233

1,262

(29)

(2.3%)

2,480

2,509

(29)

(1.2%)

    Total interest income

176,360

178,585

(2,225)

(1.2%)

351,712

359,158

(7,446)

(2.1%)

Interest Expense

Interest on deposits 

7,769

10,553

(2,784)

(26.4%)

16,310

22,589

(6,279)

(27.8%)

Interest on Federal funds purchased and securities 

 sold under agreements to repurchase

333

612

(279)

(45.6%)

743

1,379

(636)

(46.1%)

Interest on other short-term funding

525

1,197

(672)

(56.1%)

857

2,253

(1,396)

(62.0%)

Interest on long-term funding

7,551

11,956

(4,405)

(36.8%)

15,967

24,002

(8,035)

(33.5%)

    Total interest expense

16,178

24,318

(8,140)

(33.5%)

33,877

50,223

(16,346)

(32.5%)

Net Interest Income

160,182

154,267

5,915

3.8%

317,835

308,935

8,900

2.9%

Provision for loan losses

4,000

-

4,000

N/M

8,000

-

8,000

N/M

Net interest income after provision for 

 loan losses

156,182

154,267

1,915

1.2%

309,835

308,935

900

0.3%

Noninterest Income

Trust service fees

11,405

10,125

1,280

12.6%

22,315

19,912

2,403

12.1%

Service charges on deposit accounts

17,443

16,768

675

4.0%

34,272

34,810

(538)

(1.5%)

Card-based and other nondeposit fees

12,591

12,084

507

4.2%

24,541

22,963

1,578

6.9%

Insurance commissions

9,631

12,912

(3,281)

(25.4%)

21,394

24,502

(3,108)

(12.7%)

Brokerage and annuity commissions

3,688

4,206

(518)

(12.3%)

7,204

8,333

(1,129)

(13.5%)

  Total core fee-based revenue

54,758

56,095

(1,337)

(2.4%)

109,726

110,520

(794)

(0.7%)

Mortgage banking, net

19,263

16,735

2,528

15.1%

37,028

34,389

2,639

7.7%

Capital market fees, net

5,074

2,673

2,401

89.8%

7,657

6,389

1,268

19.8%

Bank owned life insurance income

3,281

3,164

117

3.7%

6,251

7,456

(1,205)

(16.2%)

Asset gains (losses), net

(44)

(4,984)

4,940

(99.1%)

792

(8,578)

9,370

(109.2%)

Investment securities gains, net

34

563

(529)

(94.0%)

334

603

(269)

(44.6%)

Other

1,944

1,705

239

14.0%

4,522

3,618

904

25.0%

    Total noninterest income

84,310

75,951

8,359

11.0%

166,310

154,397

11,913

7.7%

Noninterest Expense

Personnel expense

99,791

93,819

5,972

6.4%

197,698

188,100

9,598

5.1%

Occupancy 

14,305

14,008

297

2.1%

29,967

29,187

780

2.7%

Equipment 

6,462

5,719

743

13.0%

12,629

11,187

1,442

12.9%

Data processing

12,651

11,304

1,347

11.9%

24,159

20,820

3,339

16.0%

Business development and advertising

5,028

5,468

(440)

(8.0%)

9,565

10,849

(1,284)

(11.8%)

Other intangible amortization

1,011

1,049

(38)

(3.6%)

2,022

2,098

(76)

(3.6%)

Loan expense

3,044

2,948

96

3.3%

6,328

5,858

470

8.0%

Legal and professional fees

5,483

5,657

(174)

(3.1%)

10,828

15,372

(4,544)

(29.6%)

Losses other than loans

1,799

2,060

(261)

(12.7%)

1,483

5,610

(4,127)

(73.6%)

Foreclosure/OREO expense

2,302

4,343

(2,041)

(47.0%)

4,724

7,705

(2,981)

(38.7%)

FDIC expense

4,395

4,778

(383)

(8.0%)

9,827

9,648

179

1.9%

Other

13,725

14,877

(1,152)

(7.7%)

27,681

29,358

(1,677)

(5.7%)

    Total noninterest expense

169,996

166,030

3,966

2.4%

336,911

335,792

1,119

0.3%

Income before income taxes

70,496

64,188

6,308

9.8%

139,234

127,540

11,694

9.2%

Income tax expense 

22,608

20,871

1,737

8.3%

43,958

41,590

2,368

5.7%

Net income

47,888

43,317

4,571

10.6%

95,276

85,950

9,326

10.9%

Preferred stock dividends and discount

1,300

1,300

-

0.0%

2,600

2,600

-

0.0%

Net income available to common equity

$   46,588

$   42,017

4,571

10.9%

$   92,676

$   83,350

$  9,326

11.2%

Earnings Per Common Share:

  Basic

$       0.28

$       0.24

$    0.04

16.7%

$       0.55

$       0.48

$    0.07

14.6%

  Diluted

$       0.28

$       0.24

$    0.04

16.7%

$       0.55

$       0.48

$    0.07

14.6%

Average Common Shares Outstanding:

  Basic

166,605

172,839

(6,234)

(3.6%)

167,415

173,343

(5,928)

(3.4%)

  Diluted

166,748

172,841

(6,093)

(3.5%)

167,552

173,345

(5,793)

(3.3%)

N/M = Not meaningful.

 

 

Consolidated Statements of Income (Unaudited) - Quarterly Trend

Associated Banc-Corp

Sequential Qtr

Comparable Qtr

(in thousands, except per share amounts)

2Q13

1Q13

$ Change

% Change

4Q12

3Q12

2Q12

$ Change

% Change

Interest Income

Interest and fees on loans

$ 146,896

$ 145,527

$  1,369

0.9%

$ 150,107

$ 149,647

$ 147,188

$    (292)

(0.2%)

Interest and dividends on investment securities:

  Taxable

21,446

21,613

(167)

(0.8%)

20,368

20,548

23,000

(1,554)

(6.8%)

  Tax-exempt

6,785

6,965

(180)

(2.6%)

7,119

7,127

7,135

(350)

(4.9%)

Other interest 

1,233

1,247

(14)

(1.1%)

2,876

1,334

1,262

(29)

(2.3%)

    Total interest income

176,360

175,352

1,008

0.6%

180,470

178,656

178,585

(2,225)

(1.2%)

Interest Expense

Interest on deposits 

7,769

8,541

(772)

(9.0%)

9,091

9,751

10,553

(2,784)

(26.4%)

Interest on Federal funds purchased and securities 

 sold under agreements to repurchase

333

410

(77)

(18.8%)

558

750

612

(279)

(45.6%)

Interest on other short-term funding

525

332

193

58.1%

226

815

1,197

(672)

(56.1%)

Interest on long-term funding

7,551

8,416

(865)

(10.3%)

9,140

11,738

11,956

(4,405)

(36.8%)

    Total interest expense

16,178

17,699

(1,521)

(8.6%)

19,015

23,054

24,318

(8,140)

(33.5%)

Net Interest Income

160,182

157,653

2,529

1.6%

161,455

155,602

154,267

5,915

3.8%

Provision for loan losses

4,000

4,000

-

0.0%

3,000

-

-

4,000

N/M

Net interest income after provision for 

 loan losses

156,182

153,653

2,529

1.6%

158,455

155,602

154,267

1,915

1.2%

Noninterest Income

Trust service fees

11,405

10,910

495

4.5%

10,429

10,396

10,125

1,280

12.6%

Service charges on deposit accounts

17,443

16,829

614

3.6%

16,817

17,290

16,768

675

4.0%

Card-based and other nondeposit fees

12,591

11,950

641

5.4%

12,690

12,209

12,084

507

4.2%

Insurance commissions

9,631

11,763

(2,132)

(18.1%)

10,862

11,650

12,912

(3,281)

(25.4%)

Brokerage and annuity commissions

3,688

3,516

172

4.9%

3,678

3,632

4,206

(518)

(12.3%)

  Total core fee-based revenue

54,758

54,968

(210)

(0.4%)

54,476

55,177

56,095

(1,337)

(2.4%)

Mortgage banking, net

19,263

17,765

1,498

8.4%

13,530

15,581

16,735

2,528

15.1%

Capital market fees, net

5,074

2,583

2,491

96.4%

4,243

3,609

2,673

2,401

89.8%

Bank owned life insurance income

3,281

2,970

311

10.5%

3,206

3,290

3,164

117

3.7%

Asset gains (losses), net

(44)

836

(880)

(105.3%)

(209)

(3,309)

(4,984)

4,940

(99.1%)

Investment securities gains, net

34

300

(266)

(88.7%)

152

3,506

563

(529)

(94.0%)

Other

1,944

2,578

(634)

(24.6%)

2,507

3,134

1,705

239

14.0%

    Total noninterest income

84,310

82,000

2,310

2.8%

77,905

80,988

75,951

8,359

11.0%

Noninterest Expense

Personnel expense

99,791

97,907

1,884

1.9%

98,073

95,231

93,819

5,972

6.4%

Occupancy 

14,305

15,662

(1,357)

(8.7%)

17,273

14,334

14,008

297

2.1%

Equipment 

6,462

6,167

295

4.8%

6,444

5,935

5,719

743

13.0%

Data processing

12,651

11,508

1,143

9.9%

11,706

11,022

11,304

1,347

11.9%

Business development and advertising

5,028

4,537

491

10.8%

5,395

5,059

5,468

(440)

(8.0%)

Other intangible amortization

1,011

1,011

-

0.0%

1,049

1,048

1,049

(38)

(3.6%)

Loan expense

3,044

3,284

(240)

(7.3%)

3,130

3,297

2,948

96

3.3%

Legal and professional fees

5,483

5,345

138

2.6%

8,174

7,686

5,657

(174)

(3.1%)

Losses other than loans

1,799

(316)

2,115

N/M

3,071

3,577

2,060

(261)

(12.7%)

Foreclosure/OREO expense

2,302

2,422

(120)

(5.0%)

3,293

4,071

4,343

(2,041)

(47.0%)

FDIC expense

4,395

5,432

(1,037)

(19.1%)

4,813

5,017

4,778

(383)

(8.0%)

Other

13,725

13,956

(231)

(1.7%)

13,907

13,426

14,877

(1,152)

(7.7%)

    Total noninterest expense

169,996

166,915

3,081

1.8%

176,328

169,703

166,030

3,966

2.4%

Income before income taxes

70,496

68,738

1,758

2.6%

60,032

66,887

64,188

6,308

9.8%

Income tax expense 

22,608

21,350

1,258

5.9%

13,404

20,492

20,871

1,737

8.3%

Net income

47,888

47,388

500

1.1%

46,628

46,395

43,317

4,571

10.6%

Preferred stock dividends and discount

1,300

1,300

-

0.0%

1,300

1,300

1,300

-

0.0%

Net income available to common equity

$   46,588

$   46,088

$     500

1.1%

$   45,328

$   45,095

$   42,017

$  4,571

10.9%

Earnings Per Common Share:

  Basic

$       0.28

$       0.27

$    0.01

3.7%

$       0.26

$       0.26

$       0.24

$    0.04

16.7%

  Diluted

$       0.28

$       0.27

$    0.01

3.7%

$       0.26

$       0.26

$       0.24

$    0.04

16.7%

Average Common Shares Outstanding:

  Basic

166,605

168,234

(1,629)

(1.0%)

170,707

171,650

172,839

(6,234)

(3.6%)

  Diluted

166,748

168,404

(1,656)

(1.0%)

170,896

171,780

172,841

(6,093)

(3.5%)

N/M = Not meaningful.

 

Selected Quarterly Information

Associated Banc-Corp

(in thousands, except per share, full time equivalent employee data and otherwise noted)

YTD 2013

YTD 2012

2nd Qtr 2013

1st Qtr 2013

4th Qtr 2012

3rd Qtr 2012

2nd Qtr 2012

Summary of Operations

Net interest income

$     317,835

$     308,935

$      60,182

$     157,653

$     161,455

$     155,602

$     154,267

Provision for loan losses

8,000

-

4,000

4,000

3,000

-

-

Asset gains (losses), net

792

(8,578)

(44)

836

(209)

(3,309)

(4,984)

Investment securities gains, net

334

603

34

300

152

3,506

563

Noninterest income (excluding securities & asset gains)

165,184

162,372

84,320

80,864

77,962

80,791

80,372

Noninterest expense

336,911

335,792

169,996

166,915

176,328

169,703

166,030

Income before income taxes

139,234

127,540

70,496

68,738

60,032

66,887

64,188

Income tax expense

43,958

41,590

22,608

21,350

13,404

20,492

20,871

Net income

95,276

85,950

47,888

47,388

46,628

46,395

43,317

Net income available to common equity

92,676

83,350

46,588

46,088

45,328

45,095

42,017

Taxable equivalent adjustment

10,086

10,557

4,996

5,090

5,221

5,268

5,254

Per Common Share Data 

Net income:

  Basic

$           0.55

$           0.48

$           0.28

$           0.27

$           0.26

$           0.26

$           0.24

  Diluted

0.55

0.48

0.28

0.27

0.26

0.26

0.24

Dividends

0.16

0.10

0.08

0.08

0.08

0.05

0.05

Market Value:

  High

$         15.69

$         14.63

$         15.69

$         15.30

$         13.54

$         13.79

$         13.97

  Low

13.46

11.43

13.81

13.46

12.19

12.04

11.76

  Close

15.55

13.19

15.55

15.19

13.12

13.16

13.19

Book value

16.97

16.59

16.97

17.13

16.97

16.82

16.59

Tier 1 common equity / share

11.42

10.66

11.42

11.22

11.08

10.89

10.66

Tangible book value

11.28

11.07

11.28

11.51

11.39

11.31

11.07

Performance Ratios (annualized)

Earning assets yield

3.49

%

3.83

%

3.47

%

3.52

%

3.70

%

3.73

%

3.80

%

Interest-bearing liabilities rate

0.43

0.68

0.41

0.45

0.51

0.62

0.65

Net interest margin

3.17

3.31

3.16

3.17

3.32

3.26

3.30

Return on average assets

0.83

0.80

0.82

0.83

0.83

0.84

0.80

Return on average tangible common equity

9.78

8.86

9.76

9.81

9.15

9.32

8.87

Return on average Tier 1 common equity (1)

10.00

9.25

9.94

10.07

9.61

9.69

9.26

Efficiency ratio (2)

69.64

72.57

69.54

69.74

73.71

72.81

72.30

Efficiency ratio, fully taxable equivalent (2)

67.91

69.25

67.73

68.10

71.65

69.79

68.77

Effective tax rate

31.57

32.61

32.07

31.06

22.33

30.64

32.52

Dividend payout ratio (3)

29.09

%

20.83

%

28.57

%

29.63

%

30.77

%

19.23

%

20.83

%

Average Balances

Assets

$23,173,203

$21,671,870

$23,306,220

$23,038,708

$22,461,886

$22,016,748

$21,684,600

Earning assets

20,816,828

19,378,888

20,951,244

20,680,919

20,032,432

19,659,796

19,386,046

Interest-bearing liabilities

15,854,444

14,921,209

15,988,021

15,719,383

14,840,162

14,940,697

14,922,006

Loans (4)

15,588,752

14,456,522

15,727,807

15,448,152

15,131,102

14,916,793

14,602,602

Deposits

17,125,617

15,025,625

17,105,078

17,146,384

16,650,268

15,615,856

15,050,684

Short and long-term funding

2,917,657

3,585,023

3,074,647

2,758,923

2,638,661

3,286,943

3,566,346

Common stockholders' equity

2,853,995

2,839,482

2,857,722

2,850,227

2,915,346

2,870,438

2,852,050

Stockholders' equity

2,917,267

2,902,754

2,920,994

2,913,499

2,978,618

2,933,710

2,915,322

Average Tier 1 common equity (1)

1,868,696

1,812,684

1,880,826

1,856,431

1,876,686

1,850,610

1,825,441

Reconciliation of non-GAAP financial measures

Efficiency ratio (2)

69.64

%

72.57

%

69.54

%

69.74

%

73.71

%

72.81

%

72.30

%

Taxable equivalent adjustment

(1.43)

(1.62)

(1.39)

(1.46)

(1.57)

(1.61)

(1.62)

Asset gain (losses), net

0.12

(1.26)

(0.01)

0.24

(0.06)

(0.98)

(1.47)

Other intangible amortization

(0.42)

(0.44)

(0.41)

(0.42)

(0.43)

(0.43)

(0.44)

Efficiency ratio, fully taxable equivalent (2)

67.91

%

69.25

%

67.73

%

68.10

%

71.65

%

69.79

%

68.77

%

 

 

Selected Quarterly Information (continued)

Associated Banc-Corp

(in thousands, except per share, full time equivalent employee data and otherwise noted)

2nd Qtr 2013

1st Qtr 2013

4th Qtr 2012

3rd Qtr 2012

2nd Qtr 2012

At Period End

Assets

$23,616,944

$23,277,768

$23,487,735

$22,738,354

$22,081,100

Loans

15,746,599

15,551,562

15,411,022

14,966,214

14,698,902

Allowance for loan losses

277,218

286,923

297,409

315,150

332,658

Goodwill

929,168

929,168

929,168

929,168

929,168

Mortgage servicing rights, net

61,407

52,078

45,949

45,018

47,488

Other intangible assets, net

13,205

14,216

15,227

16,276

17,324

Deposits

17,132,436

17,421,294

16,939,865

16,450,592

15,106,871

Loans / deposits

91.91%

89.27%

90.97%

90.98%

97.30%

Risk weighted assets ($ in millions) (5) (7)

16,504

16,163

16,149

15,575

15,188

Tier 1 common equity (1)

1,893,875

1,881,410

1,875,534

1,869,931

1,828,529

Stockholders' equity / assets

12.18%

12.61%

12.50%

12.98%

13.18%

Tangible common equity / tangible assets (6)

8.25%

8.64%

8.56%

8.91%

8.99%

Tangible equity / tangible assets (6)

8.53%

8.92%

8.84%

9.20%

9.29%

Tier 1 common equity / risk-weighted assets (5) (7)

11.48%

11.64%

11.61%

12.01%

12.04%

Tier 1 leverage ratio (5) (7)

8.73%

8.78%

8.98%

9.99%

9.95%

Tier 1 risk-based capital ratio (5) (7)

11.86%

12.03%

12.01%

13.57%

13.64%

Total risk-based capital ratio (5) (7)

13.27%

13.45%

13.42%

15.00%

15.08%

Shares outstanding, end of period

165,837

167,673

169,304

171,657

171,611

Selected trend information

Average full time equivalent employees

4,790

4,841

4,915

4,965

4,951

Trust assets under management, at market value ($ in millions)

$         6,894

$         6,913

$         6,454

$         6,163

$         5,934

Mortgage loans originated for sale during period

782,398

681,410

780,469

715,184

738,091

Mortgage portfolio serviced for others ($ in millions)

7,794

7,585

7,453

7,547

7,511

Mortgage servicing rights, net / Portfolio serviced for others

0.79%

0.69%

0.62%

0.60%

0.63%

 

(1) Tier 1 common equity, a non-GAAP financial measure, is used by banking regulators, investors and analysts to assess and compare the quality and composition of our capital of other financial services companies. Management uses Tier 1 common equity, along with other capital measures, to assess and monitor our capital position. Tier 1 common equity (period end and average) is Tier 1 capital excluding qualifying perpetual preferred stock and qualifying trust preferred securities.

(2) Efficiency ratio is defined by the Federal Reserve guidance as noninterest expense divided by the sum of net interest income plus noninterest income, excluding investment securities gains / losses, net. Efficiency ratio, fully taxable equivalent, is noninterest expense, excluding other intangible amortization, divided by the sum of taxable equivalent net interest income plus noninterest income, excluding investment securities gains / losses, net and asset gains / losses, net. This efficiency ratio is presented on a taxable equivalent basis, which adjusts net interest income for the tax-favored status of certain loans and investment securities. Management believes this measure to be the preferred industry measurement of net interest income as it enchances the comparability of net interest income arising from taxable and tax-exempt sources and it excludes certain specific revenue items (such as investment securities gains / losses, net and asset gains / losses, net).

(3) Ratio is based upon basic earnings per common share.

(4) Loans held for sale have been included in the average balances.

(5) June 30, 2013 data is estimated.

(6) Tangible equity, tangible common equity and tangible assets exclude goodwill and other intangible assets, which is a non-GAAP financial measure. These financial measures have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength.

(7) The Federal Reserve establishes capital adequacy requirements, including well-capitalized standards for the Corporation. The OCC establishes simliar capital adequacy requirements and standards for the Bank. Regulatory capital primarily consists of Tier 1 risk-based capital and Tier 2 risk-based capital. The sum of Tier 1 risk-based capital and Tier 2 risk-based capital equals our total risk-based capital. Risk-based capital guidelines require a minimum level of capital as a percentage of risk-weighted assets. Risk-weighted assets consist of total assets plus certain off-balance sheet and market items, subject to adjustment for predefined credit risk factors.

 

Selected Asset Quality Information

Associated Banc-Corp

Jun13 vs Mar13

Jun13 vs Jun12

(in thousands)

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Allowance for Loan Losses

Beginning balance

$ 286,923

$ 297,409

(3.5%)

$ 315,150

$ 332,658

$ 356,298

(19.5%)

Provision for loan losses

4,000

4,000

N/M

3,000

-

-

N/M

Charge offs

(21,904)

(27,128)

(19.3%)

(30,417)

(25,030)

(30,340)

(27.8%)

Recoveries

8,199

12,642

(35.1%)

9,676

7,522

6,700

22.4%

Net charge offs

(13,705)

(14,486)

(5.4%)

(20,741)

(17,508)

(23,640)

(42.0%)

Ending balance

$ 277,218

$ 286,923

(3.4%)

$ 297,409

$ 315,150

$ 332,658

(16.7%)

Reserve for losses on unfunded commitments

$ 22,400

$ 21,100

6.2%

$ 21,800

$ 19,800

$ 18,900

18.5%

Net Charge Offs

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Commercial and industrial

$ 1,477

$ 696

112.2%

$ 2,630

$ 3,831

$ 14,544

(89.8%)

Commercial real estate - owner occupied

1,574

1,518

3.7%

2,056

(8)

1,164

35.2%

Lease financing

16

(12)

(233.3%)

754

(20)

-

N/M

Commercial and business lending

3,067

2,202

39.3%

5,440

3,803

15,708

(80.5%)

Commercial real estate - investor

2,999

163

N/M

(232)

1,905

177

N/M

Real estate construction

(95)

1,392

(106.8%)

858

(187)

558

(117.0%)

Commercial real estate lending

2,904

1,555

86.8%

626

1,718

735

295.1%

Total commercial

5,971

3,757

58.9%

6,066

5,521

16,443

(63.7%)

Home equity revolving lines of credit

2,512

3,615

(30.5%)

3,590

4,180

2,637

(4.7%)

Home equity loans 1st liens

954

765

24.7%

1,060

1,056

778

22.6%

Home equity loans junior liens

2,034

1,957

3.9%

3,421

2,686

1,869

8.8%

Home equity

5,500

6,337

(13.2%)

8,071

7,922

5,284

4.1%

Installment

66

177

(62.7%)

1,027

324

371

(82.2%)

Residential mortgage

2,168

4,215

(48.6%)

5,577

3,741

1,542

40.6%

Total consumer

7,734

10,729

(27.9%)

14,675

11,987

7,197

7.5%

Total net charge offs

$ 13,705

$ 14,486

(5.4%)

$ 20,741

$ 17,508

$ 23,640

(42.0%)

Net Charge Offs to Average Loans (in basis points) *

Jun 30, 2013

Mar 31, 2013

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

Commercial and industrial

13

6

25

37

151

Commercial real estate - owner occupied

54

51

69

(0)

43

Lease financing

12

(8)

480

(13)

-

Commercial and business lending

21

16

40

29

126

Commercial real estate - investor

41

2

(3)

27

3

Real estate construction

(5)

82

54

(12)

40

Commercial real estate lending

31

18

7

20

9

Total commercial

25

17

27

25

79

Home equity revolving lines of credit

112

159

148

167

104

Home equity loans 1st liens

42

32

40

38

28

Home equity loans junior liens

336

303

486

361

240

Home equity

108

119

140

132

86

Installment

6

16

86

26

28

Residential mortgage

24

47

64

45

19

Total consumer

50

70

93

77

46

Total net charge offs

35

38

55

47

65

Credit Quality

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Nonaccrual loans

$ 217,493

$ 225,436

(3.5%)

$ 252,868

$ 278,172

$ 317,872

(31.6%)

Other real estate owned (OREO)

27,407

35,156

(22.0%)

34,900

36,053

40,029

(31.5%)

Total nonperforming assets

$ 244,900

$ 260,592

(6.0%)

$ 287,768

$ 314,225

$ 357,901

(31.6%)

Loans 90 or more days past due and still accruing

1,548

5,690

(72.8%)

2,289

2,334

5,224

(70.4%)

Restructured loans (accruing)

119,066

120,093

(0.9%)

121,087

135,791

122,229

(2.6%)

Allowance for loan losses / loans

1.76%

1.84%

1.93%

2.11%

2.26%

Allowance for loan losses / nonaccrual loans

127.46

127.27

117.61

113.29

104.65

Nonaccrual loans / total loans

1.38

1.45

1.64

1.86

2.16

Nonperforming assets / total loans plus OREO

1.55

1.67

1.86

2.09

2.43

Nonperforming assets / total assets

1.04

1.12

1.23

1.38

1.62

Net charge offs / average loans (annualized)

0.35

0.38

0.55

0.47

0.65

Year-to-date net charge offs / average loans

0.36

0.38

0.57

0.58

0.63

Nonaccrual loans by type:

Commercial and industrial

$ 30,302

$ 33,242

(8.8%)

$ 39,182

$ 41,694

$ 46,111

(34.3%)

Commercial real estate - owner occupied

24,003

23,199

3.5%

24,254

27,161

33,417

(28.2%)

Lease financing

72

2,165

(96.7%)

3,031

5,927

8,260

(99.1%)

Commercial and business lending

54,377

58,606

(7.2%)

66,467

74,782

87,788

(38.1%)

Commercial real estate - investor

60,780

56,776

7.1%

58,687

71,522

88,806

(31.6%)

Real estate construction

21,419

22,166

(3.4%)

27,302

31,684

36,403

(41.2%)

Commercial real estate lending

82,199

78,942

4.1%

85,989

103,206

125,209

(34.4%)

Total commercial

136,576

137,548

(0.7%)

152,456

177,988

212,997

(35.9%)

Home equity revolving lines of credit

12,940

15,914

(18.7%)

20,446

19,242

22,651

(42.9%)

Home equity loans 1st liens

7,898

8,626

(8.4%)

8,717

9,425

7,870

0.4%

Home equity loans junior liens

7,296

9,405

(22.4%)

10,052

9,800

11,015

(33.8%)

Home equity

28,134

33,945

(17.1%)

39,215

38,467

41,536

(32.3%)

Installment

1,533

1,762

(13.0%)

1,838

2,893

3,047

(49.7%)

Residential mortgage

51,250

52,181

(1.8%)

59,359

58,824

60,292

(15.0%)

Total consumer

80,917

87,888

(7.9%)

100,412

100,184

104,875

(22.8%)

Total nonaccrual loans

$ 217,493

$ 225,436

(3.5%)

$ 252,868

$ 278,172

$ 317,872

(31.6%)

* Annualized.

N/M = Not meaningful.

 

 

Selected Asset Quality Information (continued)

Associated Banc-Corp

Jun13 vs Mar13

Jun13 vs Jun12

(in thousands)

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Restructured loans (accruing)

Commercial and industrial

$        30,970

$        29,251

5.9%

$        28,140

$        35,015

$        28,399

9.1%

Commercial real estate - owner occupied

14,336

12,888

11.2%

13,852

15,706

7,115

101.5%

Lease financing

-

-

N/M

-

-

-

N/M

  Commercial and business lending

45,306

42,139

7.5%

41,992

50,721

35,514

27.6%

Commercial real estate - investor

37,299

41,253

(9.6%)

41,660

49,249

49,325

(24.4%)

Real estate construction

5,365

5,540

(3.2%)

4,530

3,561

5,838

(8.1%)

  Commercial real estate lending

42,664

46,793

(8.8%)

46,190

52,810

55,163

(22.7%)

    Total commercial

87,970

88,932

(1.1%)

88,182

103,531

90,677

(3.0%)

Home equity revolving lines of credit

1,130

880

28.4%

867

803

759

48.9%

Home equity loans 1st liens

1,684

1,783

(5.6%)

1,930

1,904

2,182

(22.8%)

Home equity loans junior liens

7,119

6,893

3.3%

7,171

6,760

6,530

9.0%

  Home equity 

9,933

9,556

3.9%

9,968

9,467

9,471

4.9%

Installment

570

664

(14.2%)

653

672

779

(26.8%)

Residential mortgage

20,593

20,941

(1.7%)

22,284

22,121

21,302

(3.3%)

  Total consumer

31,096

31,161

(0.2%)

32,905

32,260

31,552

(1.4%)

        Total restructured loans (accruing)

$       119,066

$        120,093

(0.9%)

$       121,087

$       135,791

$       122,229

(2.6%)

Restructured loans in nonaccrual loans (not included above)

$         70,354

$          67,811

3.8%

$         80,590

$         74,251

$         86,395

(18.6%)

Loans Past Due 30-89 Days

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Commercial and industrial

$           8,516

$          10,263

(17.0%)

$         11,339

$           3,795

$           4,465

90.7%

Commercial real estate - owner occupied

8,105

6,804

19.1%

11,053

4,843

2,125

281.4%

Lease financing

57

283

(79.9%)

12

17

39

46.2%

  Commercial and business lending

16,678

17,350

(3.9%)

22,404

8,655

6,629

151.6%

Commercial real estate - investor

18,269

25,201

(27.5%)

13,472

8,809

12,854

42.1%

Real estate construction

797

2,287

(65.2%)

3,155

1,254

1,618

(50.7%)

  Commercial real estate lending

19,066

27,488

(30.6%)

16,627

10,063

14,472

31.7%

    Total commercial

35,744

44,838

(20.3%)

39,031

18,718

21,101

69.4%

Home equity revolving lines of credit

7,739

1,832

322.4%

7,829

9,543

7,298

6.0%

Home equity loans 1st liens

1,857

1,869

(0.6%)

1,457

1,535

3,906

(52.5%)

Home equity loans junior liens

2,709

2,848

(4.9%)

4,252

3,745

4,098

(33.9%)

  Home equity 

12,305

6,549

87.9%

13,538

14,823

15,302

(19.6%)

Installment

1,434

2,500

(42.6%)

2,109

1,693

1,558

(8.0%)

Residential mortgage

9,920

8,793

12.8%

9,403

6,878

9,836

0.9%

  Total consumer

23,659

17,842

32.6%

25,050

23,394

26,696

(11.4%)

        Total loans past due 30-89 days

$         59,403

$          62,680

(5.2%)

$         64,081

$         42,112

$         47,797

24.3%

Potential Problem Loans

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Commercial and industrial

$       127,382

$        127,367

0.0%

$       128,434

$       120,888

$       121,764

4.6%

Commercial real estate - owner occupied

75,074

93,098

(19.4%)

99,592

120,034

108,508

(30.8%)

Lease financing

279

251

11.2%

264

214

324

(13.9%)

  Commercial and business lending

202,735

220,716

(8.1%)

228,290

241,136

230,596

(12.1%)

Commercial real estate - investor

89,342

101,775

(12.2%)

107,068

133,046

142,453

(37.3%)

Real estate construction

9,184

10,040

(8.5%)

13,092

18,477

23,905

(61.6%)

  Commercial real estate lending

98,526

111,815

(11.9%)

120,160

151,523

166,358

(40.8%)

    Total commercial

301,261

332,531

(9.4%)

348,450

392,659

396,954

(24.1%)

Home equity revolving lines of credit

308

450

(31.6%)

520

518

919

(66.5%)

Home equity loans 1st liens

-

-

0.0%

-

-

-

0.0%

Home equity loans junior liens

2,307

2,871

(19.6%)

3,150

2,825

3,254

(29.1%)

  Home equity 

2,615

3,321

(21.3%)

3,670

3,343

4,173

(37.3%)

Installment

83

99

(16.2%)

111

131

127

(34.6%)

Residential mortgage

5,917

7,882

(24.9%)

8,762

8,197

8,658

(31.7%)

  Total consumer

8,615

11,302

(23.8%)

12,543

11,671

12,958

(33.5%)

        Total potential problem loans

$       309,876

$        343,833

(9.9%)

$       360,993

$       404,330

$       409,912

(24.4%)

N/M = Not meaningful.

 

Net Interest Income Analysis - Taxable Equivalent Basis

Associated Banc-Corp

Three months ended June 30, 2013

Three months ended March 31, 2013

 Average 

Interest

Average

 Average 

Interest

Average

(in thousands)

 Balance 

 Income / Expense 

 Yield / Rate 

 Balance 

 Income / Expense 

 Yield / Rate 

Earning assets:

   Loans: (1) (2) (3)

      Commercial and business lending

$   5,860,416

$                  53,613

3.67%

$   5,615,036

$                  50,712

3.66%

      Commercial real estate lending

3,722,108

35,804

3.86

3,592,509

35,864

4.04

         Total commercial

9,582,524

89,417

3.74

$   9,207,545

$                   86,576

3.81

      Residential mortgage

3,661,742

30,113

3.29

3,622,455

30,481

3.37

      Retail

2,483,541

28,291

4.56

2,618,152

29,381

4.53

         Total loans

15,727,807

147,821

3.77

15,448,152

146,438

3.83

      Investment securities

4,917,671

32,303

2.63

4,891,714

32,757

2.68

      Other short-term investments

305,766

1,232

1.61

341,053

1,247

1.47

         Investments and other

5,223,437

33,535

2.57

5,232,767

34,004

2.60

Total earning assets

20,951,244

181,356

3.47

20,680,919

180,442

3.52

   Other assets, net

2,354,976

2,357,789

Total assets

$ 23,306,220

$ 23,038,708

Interest-bearing liabilities:

   Savings deposits

$   1,207,959

$                        236

0.08%

$   1,141,781

$                        208

0.07%

   Interest-bearing demand deposits

2,867,524

1,190

0.17

2,779,929

1,179

0.17

   Money market deposits

6,930,554

3,239

0.19

7,044,344

3,615

0.21

   Time deposits

1,907,337

3,104

0.65

1,994,406

3,539

0.72

      Total interest-bearing deposits

12,913,374

7,769

0.24

12,960,460

8,541

0.27

   Federal funds purchased and securities sold under

   agreements to repurchase

677,489

333

0.20

779,550

410

0.21

   Other short-term funding

1,631,644

525

0.13

1,018,553

332

0.13

   Long-term funding

765,514

7,551

3.95

960,820

8,416

3.51

      Total short and long-term funding

3,074,647

8,409

1.09

2,758,923

9,158

1.33

Total interest-bearing liabilities

15,988,021

16,178

0.41

15,719,383

17,699

0.45

   Noninterest-bearing demand deposits

4,191,704

4,185,924

   Other liabilities

205,501

219,902

   Stockholders' equity

2,920,994

2,913,499

Total liabilities and stockholders' equity

$ 23,306,220

$ 23,038,708

Net interest income and rate spread (1)

$                 165,178

3.06%

$                 162,743

3.07%

Net interest margin (1)

3.16%

3.17%

Taxable equivalent adjustment

$                     4,996

$                     5,090

Net Interest Income Analysis - Taxable Equivalent Basis

Associated Banc-Corp

Three months ended June 30, 2013

Three months ended June 30, 2012

 Average 

Interest

Average

 Average 

Interest

Average

(in thousands)

 Balance 

 Income / Expense 

 Yield / Rate 

 Balance 

 Income / Expense 

 Yield / Rate 

Earning assets:

   Loans: (1) (2) (3)

      Commercial and business lending

$   5,860,416

$                   53,613

3.67%

$   5,016,701

$                   48,584

3.89%

      Commercial real estate lending

3,722,108

35,804

3.86

3,320,186

34,843

4.22

         Total commercial

9,582,524

89,417

3.74

$   8,336,887

$                   83,427

4.02

      Residential mortgage

3,661,742

30,113

3.29

3,273,873

30,266

3.70

      Retail

2,483,541

28,291

4.56

2,991,842

34,468

4.63

         Total loans

15,727,807

147,821

3.77

14,602,602

148,161

4.07

      Investment securities

4,917,671

32,303

2.63

4,402,800

34,416

3.13

      Other short-term investments

305,766

1,232

1.61

380,644

1,262

1.33

         Investments and other

5,223,437

33,535

2.57

4,783,444

35,678

2.98

Total earning assets

20,951,244

181,356

3.47

19,386,046

183,839

3.80

   Other assets, net

2,354,976

2,298,554

Total assets

$ 23,306,220

$ 21,684,600

Interest-bearing liabilities:

   Savings deposits

$   1,207,959

$                        236

0.08%

$   1,109,609

$                        211

0.08%

   Interest-bearing demand deposits

2,867,524

1,190

0.17

2,105,440

917

0.18

   Money market deposits

6,930,554

3,239

0.19

5,860,043

3,744

0.26

   Time deposits

1,907,337

3,104

0.65

2,280,568

5,681

1.00

      Total interest-bearing deposits

12,913,374

7,769

0.24

11,355,660

10,553

0.37

   Federal funds purchased and securities sold under

   agreements to repurchase

677,489

333

0.20

1,114,964

612

0.22

   Other short-term funding

1,631,644

525

0.13

1,279,319

1,197

0.38

   Long-term funding

765,514

7,551

3.95

1,172,063

11,956

4.08

      Total short and long-term funding

3,074,647

8,409

1.09

3,566,346

13,765

1.55

Total interest-bearing liabilities

15,988,021

16,178

0.41

14,922,006

24,318

0.65

   Noninterest-bearing demand deposits

4,191,704

3,695,024

   Other liabilities

205,501

152,248

   Stockholders' equity

2,920,994

2,915,322

Total liabilities and stockholders' equity

$ 23,306,220

$ 21,684,600

Net interest income and rate spread (1)

$                 165,178

3.06%

$                 159,521

3.15%

Net interest margin (1)

3.16%

3.30%

Taxable equivalent adjustment

$                     4,996

$                     5,254

(1) The yield on tax exempt loans and securities is computed on a taxable equivalent basis using a tax rate of 35% for all periods presented and is net of the effects of certain disallowed interest deductions.

(2) Nonaccrual loans and loans held for sale have been included in the average balances.

(3) Interest income includes net loan fees.

 

Net Interest Income Analysis - Taxable Equivalent Basis

Associated Banc-Corp

Six months ended June 30, 2013

Six months ended June 30, 2012

 Average 

Interest

Average

 Average 

Interest

Average

(in thousands)

 Balance 

 Income / Expense 

 Yield / Rate 

 Balance 

 Income / Expense 

 Yield / Rate 

Earning assets:

   Loans: (1) (2) (3)

      Commercial and business lending

$   5,738,404

$                104,325

3.66%

$   4,922,827

$                  97,569

3.98%

      Commercial real estate lending

3,657,667

71,668

3.95

3,253,668

69,345

4.28

         Total commercial

9,396,071

175,993

3.77

$   8,176,495

$                 166,914

4.10

      Residential mortgage

3,642,207

60,595

3.33

3,256,480

61,230

3.76

      Retail

2,550,474

57,672

4.55

3,023,547

69,979

4.65

         Total loans

15,588,752

294,260

3.80

14,456,522

298,123

4.14

      Investment securities

4,904,764

65,058

2.65

4,507,200

69,083

3.07

      Other short-term investments

323,312

2,480

1.54

415,166

2,509

1.21

         Investments and other

5,228,076

67,538

2.58

4,922,366

71,592

2.91

Total earning assets

20,816,828

361,798

3.49

19,378,888

369,715

3.83

   Other assets, net

2,356,375

2,292,982

Total assets

$ 23,173,203

$ 21,671,870

Interest-bearing liabilities:

   Savings deposits

$   1,175,053

$                        444

0.08%

$   1,069,499

$                        396

0.07%

   Interest-bearing demand deposits

2,823,969

2,369

0.17

2,109,947

1,861

0.18

   Money market deposits

6,987,134

6,854

0.20

5,774,305

7,302

0.25

   Time deposits

1,950,631

6,643

0.69

2,382,435

13,030

1.10

      Total interest-bearing deposits

12,936,787

16,310

0.25

11,336,186

22,589

0.40

   Federal funds purchased and securities sold under

   agreements to repurchase

728,238

743

0.21

1,228,842

1,379

0.23

   Other short-term funding

1,326,792

857

0.13

1,181,692

2,253

0.38

   Long-term funding

862,627

15,967

3.71

1,174,489

24,002

4.09

      Total short and long-term funding

2,917,657

17,567

1.21

3,585,023

27,634

1.54

Total interest-bearing liabilities

15,854,444

33,877

0.43

14,921,209

50,223

0.68

   Noninterest-bearing demand deposits

4,188,830

3,689,439

   Other liabilities

212,662

158,468

   Stockholders' equity

2,917,267

2,902,754

Total liabilities and stockholders' equity

$ 23,173,203

$ 21,671,870

Net interest income and rate spread (1)

$                 327,921

3.06%

$                 319,492

3.15%

Net interest margin (1)

3.17%

3.31%

Taxable equivalent adjustment

$                   10,086

$                   10,557

(1) The yield on tax exempt loans and securities is computed on a taxable equivalent basis using a tax rate of 35% for all periods presented and is net of the effects of certain disallowed interest deductions.

(2) Nonaccrual loans and loans held for sale have been included in the average balances.

(3) Interest income includes net loan fees.

 

 

Financial Summary and Comparison

Associated Banc-Corp

Period End Loan Composition

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Commercial and industrial

$ 4,752,838

$ 4,651,143

2.2%

$ 4,502,021

$ 4,265,356

$ 4,076,370

16.6%

Commercial real estate - owner occupied

1,174,866

1,199,513

(2.1%)

1,219,747

1,197,517

1,116,815

5.2%

Lease financing

55,084

57,908

(4.9%)

64,196

60,818

62,750

(12.2%)

Commercial and business lending

5,982,788

5,908,564

1.3%

5,785,964

5,523,691

5,255,935

13.8%

Commercial real estate - investor

3,010,992

2,900,167

3.8%

2,906,759

2,787,158

2,810,521

7.1%

Real estate - construction

800,569

729,145

9.8%

655,381

611,186

612,556

30.7%

Commercial real estate lending

3,811,561

3,629,312

5.0%

3,562,140

3,398,344

3,423,077

11.3%

Total commercial

9,794,349

9,537,876

2.7%

9,348,104

8,922,035

8,679,012

12.9%

Home equity revolving lines of credit

888,162

904,187

(1.8%)

936,065

988,800

1,009,634

(12.0%)

Home equity loans 1st liens

863,779

940,017

(8.1%)

1,013,757

1,079,075

1,116,093

(22.6%)

Home equity loans junior liens

234,292

254,203

(7.8%)

269,672

289,025

303,867

(22.9%)

Home equity

1,986,233

2,098,407

(5.3%)

2,219,494

2,356,900

2,429,594

(18.2%)

Installment

434,029

447,445

(3.0%)

466,727

482,451

510,831

(15.0%)

Residential mortgage

3,531,988

3,467,834

1.8%

3,376,697

3,204,828

3,079,465

14.7%

Total consumer

5,952,250

6,013,686

(1.0%)

6,062,918

6,044,179

6,019,890

(1.1%)

Total loans

$ 15,746,599

$ 15,551,562

1.3%

$ 15,411,022

$ 14,966,214

$ 14,698,902

7.1%

Period End Deposit and Customer Funding Composition

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Noninterest-bearing demand

$ 4,259,776

$ 4,453,109

(4.3%)

$ 4,759,556

$ 4,320,437

$ 3,874,429

9.9%

Savings

1,211,567

1,197,134

1.2%

1,109,861

1,115,783

1,117,593

8.4%

Interest-bearing demand

2,802,277

2,966,934

(5.5%)

2,554,479

2,230,740

2,078,037

34.9%

Money market

7,040,317

6,836,678

3.0%

6,518,075

6,682,640

5,822,449

20.9%

Brokered CDs

59,206

49,919

18.6%

26,270

33,612

41,104

44.0%

Other time

1,759,293

1,917,520

(8.3%)

1,971,624

2,067,380

2,173,259

(19.0%)

Total deposits

17,132,436

17,421,294

(1.7%)

16,939,865

16,450,592

15,106,871

13.4%

Customer repo sweeps

489,700

617,038

(20.6%)

564,038

600,225

592,203

(17.3%)

Customer repo term

-

4,882

(100.0%)

115,032

448,782

619,897

(100.0%)

Total customer funding

489,700

621,920

(21.3%)

679,070

1,049,007

1,212,100

(59.6%)

Total deposits and customer funding

$ 17,622,136

$ 18,043,214

(2.3%)

$ 17,618,935

$ 17,499,599

$ 16,318,971

8.0%

Network transaction deposits included above in

interest-bearing demand and money market

2,135,306

2,054,714

3.9%

1,684,745

1,740,434

1,234,010

73.0%

Brokered CDs

59,206

49,919

18.6%

26,270

33,612

41,104

44.0%

Total network and brokered funding

2,194,512

2,104,633

4.3%

1,711,015

1,774,046

1,275,114

72.1%

Net customer deposits and funding (1)

15,427,624

15,938,581

(3.2%)

15,907,920

15,725,553

15,043,857

2.6%

(1) Total deposits and customer funding excluding total network and brokered funding.

Average Loan Composition

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Commercial and industrial

$ 4,635,892

$ 4,358,486

6.4%

$ 4,182,852

$ 4,110,122

$ 3,862,439

20.0%

Commercial real estate - owner occupied

1,169,124

1,196,912

(2.3%)

1,185,846

1,103,988

1,092,326

7.0%

Lease financing

55,400

59,638

(7.1%)

62,497

60,959

61,936

(10.6%)

Commercial and business lending

5,860,416

5,615,036

4.4%

5,431,195

5,275,069

5,016,701

16.8%

Commercial real estate - investor

2,951,524

2,899,930

1.8%

2,821,023

2,832,447

2,755,943

7.1%

Real estate construction

770,584

692,579

11.3%

630,081

607,773

564,243

36.6%

Commercial real estate lending

3,722,108

3,592,509

3.6%

3,451,104

3,440,220

3,320,186

12.1%

Total commercial

9,582,524

9,207,545

4.1%

8,882,299

8,715,289

8,336,887

14.9%

Home equity revolving lines of credit

896,931

922,084

(2.7%)

962,263

995,156

1,018,512

(11.9%)

Home equity loans 1st liens

902,554

976,466

(7.6%)

1,047,207

1,097,394

1,135,391

(20.5%)

Home equity loans junior liens

242,796

262,193

(7.4%)

280,051

296,021

313,661

(22.6%)

Total home equity

2,042,281

2,160,743

(5.5%)

2,289,521

2,388,571

2,467,564

(17.2%)

Installment

441,260

457,409

(3.5%)

473,563

492,721

524,278

(15.8%)

Residential mortgage

3,661,742

3,622,455

1.1%

3,485,719

3,320,212

3,273,873

11.8%

Total consumer

6,145,283

6,240,607

(1.5%)

6,248,803

6,201,504

6,265,715

(1.9%)

Total loans

$ 15,727,807

$ 15,448,152

1.8%

$ 15,131,102

$ 14,916,793

$ 14,602,602

7.7%

Average Deposit Composition

Jun13 vs Mar13

Jun13 vs Jun12

Jun 30, 2013

Mar 31, 2013

% Change

Dec 31, 2012

Sep 30, 2012

Jun 30, 2012

% Change

Noninterest-bearing demand

$ 4,191,704

$ 4,185,924

0.1%

$ 4,448,767

$ 3,962,102

$ 3,695,024

13.4%

Savings

1,207,959

1,141,781

5.8%

1,129,983

1,117,194

1,109,609

8.9%

Interest-bearing demand

2,867,524

2,779,929

3.2%

2,236,826

2,136,280

2,105,440

36.2%

Money market

6,930,554

7,044,344

(1.6%)

6,797,306

6,240,596

5,860,043

18.3%

Time deposits

1,907,337

1,994,406

(4.4%)

2,037,386

2,159,684

2,280,568

(16.4%)

Total deposits

$ 17,105,078

$ 17,146,384

(0.2%)

$ 16,650,268

$ 15,615,856

$ 15,050,684

13.6%

 

SOURCE Associated Banc-Corp



RELATED LINKS

http://www.associatedbank.com