Camden National Corporation Reports 27% Increase in Earnings for the Second Quarter of 2011

CAMDEN, Maine, July 26, 2011 /PRNewswire/ -- Camden National Corporation (NASDAQ: CAC; "Camden National") reported net income of $7.1 million for the second quarter of 2011, an increase of $1.5 million, or 27%, compared to the second quarter of 2010 and an increase of $730,000, or 12%, compared to the first quarter of 2011. Earnings per diluted share were $0.92 for the second quarter of 2011, compared to $0.73 and $0.83 for the second quarter of 2010 and the first quarter of 2011, respectively.

Net income for the six months ended June 30, 2011 was $13.4 million, an increase of 23% compared to $10.9 million for the same period in 2010.  Earnings per diluted share for the six months ended June 30, 2011 and 2010 were $1.75 and $1.42, respectively.

"In light of an uncertain and sluggish economy, I'm pleased to report our focus on community banking fundamentals has resulted in a strong financial performance for the second quarter of 2011," said Gregory A. Dufour, president and chief executive officer of Camden National. "Our return on average assets was 1.22% for the second quarter of 2011, compared to 0.98% for the second quarter of 2010 and our national peer group average of 0.57%, based on the most recent Bank Holding Company Report dated March 31, 2011.  Return on average equity for the second quarter of 2011 and 2010 was 13.29% and 11.36%, respectively, compared to our national peer group average of 6.21% for the first quarter of 2011. We anticipate these financial results will place us in the top level of our national peer group."

Balance Sheet Highlights

Camden National's total assets of $2.3 billion at June 30, 2011 increased $25.0 million compared to December 31, 2010.  Total loans grew to $1.6 billion at June 30, 2011, an increase of $26.7 million, or 2%, for the first six months of 2011. Our loan growth was centered in the commercial loan portfolio, which increased $33.8 million, or 19%, since year end.  Residential real estate loans declined by $6.2 million, or 1%, due to the sale of thirty-year fixed rate mortgages.

Total deposits of $1.5 billion at June 30, 2011 increased $29.7 million compared to December 31, 2010. Since year end, core deposits grew $61.4 million, or 6%, while retail certificate of deposits declined $36.6 million, or 8%.

Asset Quality and the Provision for Credit Losses

"Our loan loss provision for the first half of 2011 decreased $1.9 million from the comparable period in 2010, reflecting continued stabilization of our asset quality," said Dufour. "Despite lower net loan charge-offs, we continue to maintain a cautionary outlook for asset quality as we saw a slight increase in non-performing assets, which is indicative of ongoing weak consumer credit conditions."

Non-performing assets at June 30, 2011 were $26.8 million, up from $25.1 million at March 31, 2011 and $25.9 million at June 30, 2010.  Camden National's non-performing assets compared to total assets increased slightly to 1.15% compared to the same period in 2010, but continued to compare favorably to our national peer group's average of 3.73%, based on the most recent Bank Holding Company Performance Report dated March 31, 2011. When comparing the non-performing asset composition from a year ago, other real estate owned declined $2.2 million, residential real estate non-accrual loans increased $2.0 million and restructured consumer loans increased $2.4 million.

Net loan charge-offs of $1.4 million during the first half of 2011, present a declining trend compared to $1.9 million in the same period a year ago.  These net charge-offs resulted in year-to-date annualized net charge-offs to average loans of 0.18% and 0.25% for those respective periods.

Net Interest Income

Camden National's net interest income of $19.6 million for the second quarter of 2011 increased $1.0 million compared to the first quarter of 2011 and the second quarter of 2010.  The tax equivalent net interest margin increased to 3.64% for the second quarter of 2011, compared to 3.49% and 3.59% for the first quarter of 2011 and second quarter of 2010, respectively. During the second quarter of 2011, Camden National collected approximately $600,000 of loan related non-recurring fees.  

Net interest income for the six months ended June 30, 2011 totaled $38.1 million, an increase of $1.5 million, or 4%, compared to $36.6 million for the same period a year ago.  The increase in net interest income is primarily due to growth in our average earning assets of $90.5 million, partially offset by a slight decline in our net interest margin to 3.57% from 3.59% for the six months ended June 30, 2011 and 2010, respectively.

Non-Interest Income and Non-Interest Expense

Non-interest income of $5.0 million for the second quarter of 2011 increased $581,000, or 13%, compared to the second quarter of 2010. The growth in non-interest income was primarily due to an increase of $267,000 in our loan servicing business, which now services 6,000 Maine Housing loans, and an increase in debit card interchange income of $114,000. On a linked-quarter basis (comparing current quarter results to the previous quarter), second quarter 2011 non-interest income declined $112,000, primarily related to the non-recurring bank-owned life insurance proceeds of $170,000 recorded in the first quarter of 2011.

Non-interest income of $10.1 million for the six months ended June 30, 2011 increased $1.1 million, or 13%, compared to the same period in 2010, with over half of the increase driven by the growth in loan servicing income.  

Non-interest expense of $13.3 million for the second quarter of 2011 increased $415,000, or 3%, compared to the second quarter of 2010, primarily due to increases in salaries and employee benefits of $816,000 and consulting fees of $318,000, partially offset by declines in write-downs of other real estate owned of $772,000.  Salaries and employee benefits reflect an increase in employees' incentive compensation of $425,000, based on our second quarter 2011 financial performance.  During the second quarter, we engaged an outside consultant to facilitate an in-depth review of business processes, which resulted in a $318,000 increase in consulting and professional fees. On a linked-quarter basis, second quarter 2011 non-interest expense declined slightly as we benefited from lower FDIC deposit assessments and lower occupancy costs related to snow removal which was partially offset by increases in salaries and employee benefits and consulting fees.

Non-interest expense of $26.6 million for the six months ended June 30, 2011 increased $778,000 compared to the same period in 2010.  This 3% increase relates to increases in salaries and employee benefit costs and consulting fees, partially offset by a decline in write-downs of other real estate owned.

Camden National's efficiency ratio improved to 53.39% in the second quarter of 2011 from 55.27% and 54.76% for the first quarter of 2011 and the second quarter of 2010, respectively.  Camden National's efficiency ratio was 54.31% and 55.41% for the six months ended June 30, 2011 and 2010, respectively.

Dividends and Capital

The board of directors approved a dividend of $0.25 per share, payable on July 29, 2011, to shareholders of record on July 15, 2011.  This resulted in an annualized dividend yield of 3.05%, based on the June 30, 2011 closing price of Camden National's common stock of $32.81 per share as reported on NASDAQ.

Camden National's total risk-based capital ratio increased to 15.45% at June 30, 2011, compared to 13.99% at June 30, 2010, and 15.05% at December 31, 2010, as capital levels increased from retained earnings. The Company and Camden National Bank exceeded the minimum total risk-based, tier 1 and tier 1 leverage ratios of 10.0%, 6.0%, and 5.0%, respectively, required by the Federal Reserve for an institution to be considered "well capitalized."

About Camden National Corporation

Camden National Corporation, headquartered in Camden, Maine, and ranked 12th in US Banker's list of top-performing mid-tier banks in 2010, is the holding company employing more than 400 Maine residents for two financial services companies including Camden National Bank and the wealth management company, Acadia Trust, N.A. Camden National Bank is a full-service community bank with a network of 38 banking offices throughout Maine. Acadia Trust offers investment management and fiduciary services with offices in Portland, Bangor and Ellsworth. Located at Camden National Bank, Camden Financial Consultants, formerly known as Acadia Financial Consultants, offers full-service brokerage and insurance services.

Forward-Looking Statements

This press release and the documents incorporated by reference herein contain certain statements that may be considered forward-looking statements under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of the words "believe," "expect," "anticipate," "intend," "estimate," "assume," "will," "should," and other expressions which predict or indicate future events or trends and which do not relate to historical matters. Forward-looking statements should not be relied on, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond the control of Camden National. These risks, uncertainties and other factors may cause the actual results, performance or achievements of Camden National to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements.

Some of the factors that might cause these differences include the following: general, national, regional or local economic conditions which are less favorable than anticipated; changes in loan default and charge-off rates; declines in the equity and financial markets; reductions in deposit levels; declines in mortgage loan refinancing, equity loan and line of credit activity; changes in the domestic interest rate environment and inflation; changes in the carrying value of investment securities and other assets; further actions by the U.S. government and Treasury Department, including actions similar to the Federal Home Loan Mortgage Corporation conservatorship, which could have a negative impact on Camden National's investment portfolio and earnings; misalignment of Camden National's interest-bearing assets and liabilities; increases in loan repayment rates affecting interest income and the value of mortgage servicing rights; changing business, banking, or regulatory conditions or policies, or new legislation affecting the financial services industry, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act, that could lead to changes in the competitive balance among financial institutions, restrictions on bank activities, changes in costs (including deposit insurance premiums), increased regulatory scrutiny, declines in consumer confidence in depository institutions, or changes in the secondary market for bank loan and other products; and changes in accounting rules, Federal and State laws, Internal Revenue Service regulations, and other regulations and policies governing financial holding companies and their subsidiaries which may impact our ability to take appropriate action to protect our financial interests in certain loan situations. Other factors could also cause these differences. For more information about these factors please see our Annual Report on Form 10-K, as updated by our Quarterly Reports on Form 10-Q and other filings on file with the SEC. All of these factors should be carefully reviewed, and readers should not place undue reliance on these forward-looking statements.

These forward-looking statements were based on information, plans and estimates at the date of this press release, and Camden National does not promise to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.

Statement of Condition Data (unaudited)











June 30,

June 30,


December 31,

(In thousands, except number of shares)


2011



2010



2010










Assets









Cash and due from banks

$

29,685


$

24,236


$

31,009

Securities









    Securities available for sale, at fair value


595,335



533,736



553,579

    Securities held to maturity, at amortized cost


-



37,786



36,102

    Federal Home Loan Bank and Federal Reserve Bank stock, at cost


21,962



21,965



21,962

         Total securities


617,297



593,487



611,643

Trading account assets


2,270



2,013



2,304

Loans held for sale


1,855



-



5,528

Loans


1,551,456



1,542,074



1,524,752

  Less allowance for loan losses


(22,989)



(22,266)



(22,293)

         Net loans


1,528,467



1,519,808



1,502,459

Goodwill and other intangible assets


45,533



46,110



45,821

Bank-owned life insurance


43,659



42,395



43,155

Premises and equipment, net


24,294



26,230



25,044

Deferred tax asset


10,496



10,370



12,281

Interest receivable


7,063



7,558



6,875

Prepaid FDIC assessment


5,353



7,187



6,155

Other real estate owned


1,816



3,967



2,387

Other assets


13,226



11,473



11,346

    Total assets

$

2,331,014


$

2,294,834


$

2,306,007










Liabilities









Deposits









  Demand

$

238,405


$

202,448


$

229,547

  Interest checking, savings and money market


774,455



693,644



721,905

  Retail certificates of deposit


428,104



522,894



464,662

  Brokered deposits


104,587



129,690



99,697

    Total deposits


1,545,551



1,548,676



1,515,811

Federal Home Loan Bank advances


157,044



174,503



214,236

Other borrowed funds


341,113



306,186



302,069

Junior subordinated debentures


43,666



43,563



43,614

Accrued interest and other liabilities


25,399



22,191



24,282

    Total liabilities


2,112,773



2,095,119



2,100,012










Shareholders' Equity









Common stock, no par value; authorized 20,000,000 shares, issued and









  outstanding 7,677,693, 7,657,098, and 7,658,496 shares on June 30, 2011









  and 2010 and December 31, 2010, respectively


51,111



50,376



50,936

Retained earnings


160,297



140,656



150,730

Accumulated other comprehensive income









   Net unrealized gains on securities available for sale, net of tax


9,787



11,066



6,229

   Net unrealized losses on derivative instruments, at fair value, net of tax


(1,791)



(1,442)



(709)

   Net unrecognized losses on post-retirement plans, net of tax


(1,163)



(941)



(1,191)

         Total accumulated other comprehensive income


6,833



8,683



4,329

    Total shareholders' equity


218,241



199,715



205,995

    Total liabilities and shareholders' equity

$

2,331,014


$

2,294,834


$

2,306,007




Statement of Income Data (unaudited)




















Three Months Ended June 30,




Six Months Ended June 30,

(In thousands, except number of shares and per share data)


2011



2010




2011



2010














Interest income













Interest and fees on loans

$

20,257


$

20,593



$

39,726


$

41,040

Interest on U.S. government and sponsored enterprise obligations


4,917



5,166




9,802



10,329

Interest on state and political subdivision obligations


431



534




897



1,073

Interest on federal funds sold and other investments


40



33




80



56

    Total interest income


25,645



26,326




50,505



52,498

Interest expense













Interest on deposits


2,963



3,959




5,978



8,078

Interest on borrowings


2,463



3,110




5,054



6,404



656



702




1,351



1,396

    Total interest expense


6,082



7,771




12,383



15,878

    Net interest income


19,563



18,555




38,122



36,620

Provision for credit losses


970



1,950




2,089



3,946

    Net interest income after provision for credit losses


18,593



16,605




36,033



32,674

Non-interest income













Income from fiduciary services


1,439



1,512




2,986



3,079

Service charges on deposit accounts


1,352



1,285




2,583



2,565

Other service charges and fees


943



872




1,813



1,562

Bank-owned life insurance


335



347




874



718

Brokerage and insurance commissions


385



352




743



646

Mortgage banking income, net


52



83




132



172

Net gain on sale of securities


53



-




20



-

Other income


474



105




1,000



434

    Non-interest income before other-than-temporary













       impairment of securities


5,033



4,556




10,151



9,176

Other-than-temporary impairment of securities


(27)



(131)




(27)



(179)

    Total non-interest income


5,006



4,425




10,124



8,997

Non-interest expenses













Salaries and employee benefits


7,114



6,298




13,965



12,523

Furniture, equipment and data processing


1,169



1,116




2,369



2,246

Net occupancy


956



897




2,016



1,931

Other real estate owned and collection costs


415



1,158




906



2,132

Regulatory assessments


402



602




1,105



1,317

Consulting and professional fees


868



550




1,542



1,338

Amortization of identifiable intangible assets


145



144




289



288

Other expenses


2,203



2,092




4,365



4,004

    Total non-interest expenses


13,272



12,857




26,557



25,779

    Income before income taxes


10,327



8,173




19,600



15,892

Income taxes


3,257



2,587




6,191



4,993

Net income

$

7,070


$

5,586



$

13,409


$

10,899



























Selected Financial and Per Share Data:













Return on average equity


13.29%



11.36%




12.88%



11.25%

Return on average tangible equity


16.90%



14.83%




16.46%



14.74%

Return on average assets


1.22%



0.98%




1.16%



0.98%

Efficiency ratio (1)


53.39%



54.76%




54.31%



55.41%

Basic earnings per share

$

0.92


$

0.73



$

1.75


$

1.42

Diluted earnings per share

$

0.92


$

0.73



$

1.75


$

1.42

Cash dividends declared per share

$

0.25


$

0.25



$

0.50


$

0.50

Weighted average number of common shares outstanding


7,677,594



7,656,051




7,668,831



7,654,079

Diluted weighted average number of common shares outstanding


7,687,133



7,664,443




7,679,298



7,661,607














(1) Computed by dividing non-interest expense by the sum of net interest income (tax equivalent) and non-interest income (excluding securities gains/losses).






















Average Balance, Interest and Yield/Rate Analysis (unaudited)

















At or for the Six Months Ended


At or for the Six Months Ended



June 30, 2011



June 30, 2010

(In thousands)


Average





Yield/



Average





Yield/



Balance



Interest


Rate



Balance



Interest


Rate

Assets
















Interest-earning assets:
















    Securities - taxable

$

576,887


$

9,873


3.42%


$

485,636


$

10,375


4.27%

    Securities - nontaxable (1)


46,862



1,380


5.89%



55,322



1,651


5.97%

    Trading account assets


2,260



9


0.82%



1,809



10


1.06%

    Loans: (1) (2)
















       Residential real estate


595,625



15,356


5.16%



625,515



16,873


5.39%

       Commercial real estate


465,478



12,955


5.54%



438,198



12,511


5.68%

       Commercial


177,412



4,633


5.19%



177,608



4,851


5.43%

       Municipal


19,202



458


4.81%



15,265



425


5.62%

       Consumer


281,229



6,484


4.65%



275,102



6,529


4.79%

    Total loans


1,538,946



39,886


5.18%



1,531,688



41,189


5.37%

 Total interest-earning assets


2,164,955



51,148


4.72%



2,074,455



53,225


5.13%

 Cash and due from banks


25,580








35,234






 Other assets


157,123








163,488






 Less allowance for loan losses


(22,735)








(21,601)






 Total assets

$

2,324,923







$

2,251,576






















Liabilities & Shareholders' Equity
















Interest-bearing liabilities:
















    Interest checking accounts

$

240,827



277


0.23%


$

244,577



486


0.40%

    Savings accounts


167,590



206


0.25%



151,453



244


0.33%

    Money market accounts


324,516



1,187


0.74%



282,143



1,168


0.83%

    Certificates of deposit


451,345



3,345


1.49%



536,838



5,378


2.02%

        Total retail deposits


1,184,278



5,015


0.85%



1,215,011



7,276


1.21%

    Brokered deposits


119,043



963


1.63%



92,257



802


1.75%

    Junior subordinated debentures


43,641



1,351


6.24%



43,541



1,396


6.47%

    Borrowings


516,427



5,054


1.97%



493,170



6,404


2.62%

       Total wholesale funding


679,111



7,368


2.19%



628,968



8,602


2.76%

 Total interest-bearing liabilities


1,863,389



12,383


1.34%



1,843,979



15,878


1.74%

















 Demand deposits


229,743








189,542






 Other liabilities


21,829








22,732






 Shareholders' equity


209,962








195,323






 Total liabilities & shareholders' equity

$

2,324,923







$

2,251,576






















Net interest income (fully-taxable equivalent)





38,765








37,347



Less:  fully-taxable equivalent adjustment





(643)








(727)



 Net interest income




$

38,122







$

36,620



















Net interest rate spread (fully-taxable equivalent)







3.38%








3.39%

Net interest margin (fully-taxable equivalent)







3.57%








3.59%

















































(1)  Reported on tax-equivalent basis calculated using a tax rate of 35%.











(2)  Non-accrual loans and loans held for sale are included in total average loans.













Asset Quality Data (unaudited)



















At or for Six Months Ended


At or for Three Months Ended


At or for Twelve Months Ended


At or for Nine Months Ended


At or for Six Months Ended

(In thousands)

June 30, 2011


March 31, 2011


December 31, 2010


September 30, 2010


June 30, 2010
















Non-accrual loans:















    Residential real estate

$

8,581


$

8,171


$

7,225


$

5,793


$

6,580

    Commercial real estate


7,661



6,442



6,072



6,725



7,130

    Commercial


3,809



3,977



4,421



4,334



5,379

    Consumer


1,464



1,337



1,721



1,155



1,249

Total non-accrual loans


21,515



19,927



19,439



18,007



20,338

Loans 90 days past due and accruing


-



430



711



1,034



545

Renegotiated loans not included above


3,447



2,584



2,295



2,055



1,096

Total non-performing loans


24,962



22,941



22,445



21,096



21,979

Other real estate owned:















    Residential real estate


989



251



284



412



560

    Commercial real estate


827



1,939



2,103



2,218



3,407

Total other real estate owned


1,816



2,190



2,387



2,630



3,967

Total non-performing assets

$

26,778


$

25,131


$

24,832


$

23,726


$

25,946
















Loans 30-89 days past due:















    Residential real estate

$

500


$

2,739


$

2,493


$

3,186


$

1,338

    Commercial real estate


1,668



2,786



1,439



1,234



749

    Commercial


771



1,393



928



2,772



1,367

    Consumer


344



358



926



436



537

Total loans 30-89 days past due

$

3,283


$

7,276


$

5,786


$

7,628


$

3,991































Allowance for loan losses at the beginning of the period

$

22,293


$

22,293


$

20,246


$

20,246


$

20,246

Provision for loan losses


2,083



1,117



6,325



5,242



3,950

Charge-offs:















    Residential real estate


797



172



1,262



1,103



579

    Commercial real estate


325



231



1,382



844



752

    Commercial


755



378



1,502



1,098



684

    Consumer


140



66



1,401



760



395

Total charge-offs


2,017



847



5,547



3,805



2,410

Total recoveries


630



324



1,269



653



480

Net charge-offs


1,387



523



4,278



3,152



1,930

Allowance for loan losses at the end of the period

$

22,989


$

22,887


$

22,293


$

22,336


$

22,266
















Components of allowance for credit losses:















    Allowance for loan losses

$

22,989


$

22,887


$

22,293


$

22,336


$

22,266

    Liability for unfunded credit commitments


31



28



25



47



47

Balance of allowance for credit losses

$

23,020


$

22,915


$

22,318


$

22,383


$

22,313































Ratios:















Non-performing loans to total loans


1.61%



1.49%



1.47%



1.37%



1.43%

Non-performing assets to total assets


1.15%



1.08%



1.08%



1.03%



1.13%

Allowance for credit losses to total loans


1.48%



1.49%



1.46%



1.45%



1.45%

Net charge-offs to average loans (annualized)















  Quarter-to-date


0.22%



0.14%



0.29%



0.32%



0.28%

  Year-to-date


0.18%



0.14%



0.28%



0.27%



0.25%

Allowance for credit losses to non-performing loans


92.22%



99.89%



99.44%



106.10%



101.52%

Loans 30-89 days past due to total loans


0.21%



0.47%



0.38%



0.50%



0.26%




Selected Financial Data (unaudited)



































 June 30, 


December 31,





2011



2010



2010
















Tier 1 leverage capital ratio


9.13%



8.41%



8.77%




Tier 1 risk-based capital ratio


14.19%



12.74%



13.80%




Total risk-based capital ratio


15.45%



13.99%



15.05%




Tangible equity to tangible assets (1)


7.56%



6.83%



7.09%




Book value per share

$

28.43


$

26.08


$

26.90




Tangible book value per share (2)

$

22.49


$

20.06


$

20.91























































Investment Data (unaudited)














June 30, 2011



Amortized



Unrealized



Unrealized



Fair

(In thousands)


Cost



Gains



Losses



Value













Available for sale












Obligations of U.S. government sponsored enterprises

$

69,898


$

231


$

(355)


$

69,774

Obligations of states and political subdivisions


39,343



2,327



-



41,670

Mortgage-backed securities issued or guaranteed by












    U.S. government sponsored enterprises


445,084



17,368



(1,913)



460,539

Private issue collateralized mortgage obligations (CMO)


20,953



10



(2,027)



18,936

        Total debt securities


575,278



19,936



(4,295)



590,919

Equity securities


5,000



-



(584)



4,416

        Total securities available for sale

$

580,278


$

19,936


$

(4,879)


$

595,335













Other securities












Federal Home Loan Bank Stock

$

21,031


$

-


$

-


$

21,031

Federal Reserve Bank Stock


931



-



-



931

        Total other securities

$

21,962


$

-


$

-


$

21,962













Trading account assets










$

2,270

























(1) Computed by dividing total shareholders' equity less goodwill and other intangible assets by total assets less goodwill and other intangible assets.

(2) Computed by dividing total shareholders' equity less goodwill and other intangible assets by the number of common shares outstanding.




(Logo:  http://photos.prnewswire.com/prnh/20110505/NE96304LOGO-b )

SOURCE Camden National Corporation



RELATED LINKS
http://www.camdennational.com

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.