WesBanco Announces 2015 Net Income

Jan 26, 2016, 16:19 ET from WesBanco, Inc.

WHEELING, W.Va., Jan. 26, 2016 /PRNewswire/ -- Todd F. Clossin, President and Chief Executive Officer of WesBanco, Inc. (NASDAQ: WSBC), a Wheeling, West Virginia based multi-state bank holding company, today announced net income and related earnings per share for the three and twelve months ended December 31, 2015.  Net income for 2015 was $80.8 million or $2.15 per diluted share compared to $70.0 million or $2.39 per diluted share for 2014.  Net income for the three months ended December 31, 2015 was $23.0 million, while diluted earnings per share were $0.60, compared to $16.5 million or $0.56 per diluted share for the fourth quarter of 2014.  For the year ended December 31, 2015, net income excluding after-tax merger-related expenses (non-GAAP measure), increased 24.2% to $88.0 million compared to $70.8 million for 2014, while diluted earnings per share, excluding after-tax merger-related expenses (non-GAAP measure), totaled $2.34, compared to $2.41 per share for 2014.

 

For the Three Months Ended December 31, 

For the Twelve Months Ended December 31,

2015

2014

2015

2014

(unaudited, dollars in thousands, except per share amounts)

Net Income

Diluted Earnings Per Share

Net Income

Diluted Earnings Per Share

Net Income

Diluted Earnings Per Share

Net Income

Diluted Earnings Per Share

Net income (Non-GAAP)(1)

$      23,033

$       0.60

$      17,363

$       0.59

$      87,965

$       2.34

$      70,825

$       2.41

Less: After tax merger-related expenses

(31)

-

(851)

(0.03)

(7,203)

(0.19)

(851)

(0.03)

Net income (GAAP)

$      23,002

$       0.60

$      16,512

$       0.56

$      80,762

$       2.15

$      69,974

$       2.39

(1)Non-GAAP net income excludes after-tax merger related expenses.  Non-GAAP measures are defined on page 10 under "Non-GAAP Financial Measures."

 

WesBanco's results for the three and twelve months ended December 31, 2015 included ESB Financial Corporation's ("ESB") results from February 10, 2015, the date of consummation of the merger.  ESB was a Pennsylvania thrift holding company with approximately $2.0 billion in assets and 23 offices in southwestern Pennsylvania. 

"Fiscal 2015 was another successful year for WesBanco.  We grew to $8.5 billion in assets with the completion of our largest acquisition to-date, and subsequently achieved top ten market share in the Pittsburgh metropolitan area.  We delivered positive operating leverage on record earnings of $81 million," said Mr. Clossin.  "During 2015, we realized total loan growth of 24%, including organic loan growth of 7%, while continuing to improve our already strong credit quality ratios.  Our growth during the quarter was supported by diligently managing our cost structure as reflected in further improvement in our efficiency ratio.  In addition, we generated returns on average assets and average tangible equity (non-GAAP measure) of 1.07% and 14.68%, respectively."

Mr. Clossin added, "Our strong regulatory and compliance framework, coupled with our diversification and balanced growth, helped us to once again be named to Forbes Magazine's 2016 list of America's Best Banks.  We are excited about our opportunities for the upcoming year, and look forward to executing on our growth strategies as we provide additional value to our customers and shareholders."

Financial Condition

Total assets at December 31, 2015 increased 34.5% or $2.2 billion compared to December 31, 2014, with approximately $2.0 billion from the acquisition of ESB and $0.2 billion from organic growth exclusive of ESB.  Portfolio loans increased $979.1 million, with $701.0 million from the acquisition and $278.1 million from loan growth exclusive of ESB.  Organic loan growth in 2015 was 6.8%, primarily achieved through $1.8 billion in loan originations compared to $1.4 billion last year. Organic loan growth occurred in all loan categories, with approximately 15.2% of the growth in commercial and industrial loans and 22.0% in home equity loans.  Loan growth was driven by increased business activity, additional commercial and residential lending personnel in our urban markets, focused marketing efforts and continued improvement in loan origination processes. Deposits increased $1.0 billion compared to December 31, 2014, due to the acquisition.  Non-interest bearing deposits, excluding $128.0 million from the acquisition, were up 11.5% over the last year. Excluding certificates of deposit and acquired deposits from ESB, deposits increased $166.8 million or 4.5% from December 31, 2014, with deposits from Marcellus and Utica shale gas customers contributing $140.9 million to the increase.  Certificates of deposit, excluding $645.1 million from ESB, decreased $392.4 million from December 31, 2014 due to lower rate offerings for single service maturing CDs and customer preferences for other deposit types as we remix our deposits to emphasize multiple relationship customers.

WesBanco continues to maintain strong regulatory capital ratios after the ESB acquisition and implementation of the new BASEL III capital standards.  At December 31, 2015, Tier I leverage was 9.38%, Tier I Risk-Based capital was 13.39%, and Total Risk-Based capital was 14.15%.  Both consolidated and bank-level regulatory capital ratios are well above the applicable, revised "well-capitalized" standards promulgated by bank regulators, as well as the recently finalized BASEL III capital standards.  As required by BASEL III, a new ratio for 2015, Common Equity Tier 1 capital ratio (CET 1), was 11.70% for the fourth quarter of 2015, significantly above the requirement of 4.5%. Total tangible equity to tangible assets (non-GAAP measure) was 7.95% at December 31, 2015, increasing from pre-acquisition 7.88% at December 31, 2014, and improved over each of the first three quarters of 2015. Strong earnings and increased total capital have enabled WesBanco to increase the quarterly dividend rate, currently at $0.23 per share, eight times over the last five years, cumulatively representing a 64% increase.  The most recent increase was $0.01 per share in the first quarter of 2015.

Credit Quality

The provision for credit losses increased 30.4% due to loan growth in 2015.  Net charge-offs for 2015 as a percentage of average portfolio loans of 0.23% were unchanged from 2014.

Non-performing loans, including TDRs, as well as criticized and classified loans, improved as a percentage of total portfolio loans from their pre-acquisition levels in the fourth quarter of 2014. Total non-performing loans were 1.04% of total loans at December 31, 2015, decreasing from 1.25% of total loans at December 31, 2014. Criticized and classified loans were 1.57% of total loans, improving from 1.99% of total loans a year ago.  Past due loans at December 31, 2015 were 0.28% of total loans, improving slightly from 0.29% at December 31, 2014.

The allowance for loan losses represented 0.82% of total portfolio loans at December 31, 2015.  If the acquired ESB loans (which were recorded at fair value at the date of acquisition of $701.0 million) were excluded from the ratio, the allowance would approximate 0.96% of the adjusted loan total as compared to 1.09% at the end of 2014 before the acquisition.

Net Interest Income

Net interest income increased $43.8 million or 22.6% in 2015 compared to 2014 due to a 29.9% increase in average earning assets, primarily through the acquisition, and through a 6.7% increase in average loan balances, exclusive of ESB, partially offset by a 20 basis point decrease in the net interest margin.

The net interest margin decreased to 3.41% in 2015 compared to 3.61% in 2014. The decrease in the net interest margin is primarily due to a change in the mix of investments to total average earning assets from 28.1% in 2014 to 32.3% in 2015, a 41 basis point decline in the average rate earned on securities due to lower yields from a restructuring of the ESB portfolio and a decrease of 14 basis points for total loans due to repricing of existing loans and competitive pricing on new loans.  The lower rates were due to the low interest rate environment and were somewhat mitigated by a reduction in funding costs of 9 basis points.  In addition, the aforementioned loan growth improves asset yields as the average rate on loans is higher than the average rate on securities. Funding costs continued to decrease in 2015 primarily as a result of a 29 basis point decrease in the average rate on CDs as higher-rate CDs matured, somewhat offset by higher FHLB borrowing costs. Overall, excluding CDs and acquired deposits from ESB, average deposits increased 5.5% in 2015 compared to 2014 with a decrease in total rate of 10 basis points on interest bearing deposits.  For the fourth quarter, net interest income increased by $11.6 million or 23.7% compared to the fourth quarter of 2014, as average earning assets increased by 34.6% including a 5.9% increase in average loans, exclusive of ESB, and the net interest margin decreased by 28 basis points.

Non-Interest Income

For 2015, non-interest income increased $6.0 million or 8.7% compared to 2014. Trust fees increased $0.8 million or 3.9% from customer and revenue development initiatives.  Service charges on deposits increased $0.6 million or 3.8% from the addition of ESB and an overall evaluation of the fee schedule.  Electronic banking fees increased $1.7 million or 13.0% from increases in transaction volume.  Net security brokerage revenue increased by $0.8 million or 11.1% through the addition of support and sales staff in several regions. Net gains on sales of mortgage loans increased $0.5 million or 29.1% from increases in originations and a larger percentage of originations being sold in the secondary market. Net losses on other assets improved by $1.4 million due to a $1.4 million charge in the third quarter of 2014 relating to the prepayment of certain repurchase agreements.  For the fourth quarter of 2015, non-interest income increased by $3.5 million or 20.9%, reflecting similar trends as in the year-to-date period, while bank-owned life insurance increased by $0.6 million or 54.1% due to a death benefit, and net securities gains increased by $0.7 million.

Non-Interest Expense

The following paragraph on non-interest expense excludes annual after-tax merger-related expenses of $7.2 million in 2015 and $0.9 million in 2014.  In 2015, non-interest expense grew 14.0%, compared to 2014, primarily due to the ESB acquisition.  With net revenue growth of 19.0%, the efficiency ratio improved in 2015 to 57.1% from 59.6% in 2014. Overall, non-interest expense increased $22.5 million or 14.0% in 2015, principally from the acquisition which increased assets by $2.0 billion and added 23 offices to our branch network.  Salaries and wages increased $9.9 million or 14.7%, due to a 13.0% increase in average full-time equivalent employees from the merger and routine annual adjustments to compensation, partially offset by increased deferrals of compensation costs on new loan originations. Employee benefits expense increased $5.4 million or 25.0%, primarily from increased pension, health insurance, social security contributions and other benefit plan costs.  Net occupancy increased $1.5 million principally due to increased building-related costs including utilities, lease expense, and depreciation. Equipment costs increased $1.7 million related to continuous improvements in computer system infrastructure, and origination and customer support systems.  Amortization of intangible assets increased $1.2 million from additional ESB intangible assets, related to core deposits and non-compete agreements. In the fourth quarter, non-interest expense increased by $6.2 million or 15.2% compared to the fourth quarter of 2014, reflecting factors similar to the 12 month period.

Financial Results Conference Call

WesBanco will also host a conference call to discuss the Company's financial results for the fourth quarter of 2015 at 10 a.m. ET on Wednesday, January 27, 2016.  Interested parties can access the live webcast of the conference call through the Investor Relations section of the Company's website, www.wesbanco.com.  Participants can also listen to the conference call by dialing 888-347-6607, or 412-902-4290 for international callers, and asking to be joined into the WesBanco call.  Please log in or dial in at least 10 minutes prior to the start time to ensure a connection.

WesBanco is a multi-state bank holding company with total assets of approximately $8.5 billion, operating through 141 branch locations and 129 ATMs in West Virginia, Ohio, and Pennsylvania.  WesBanco's banking subsidiary is WesBanco Bank, Inc., headquartered in Wheeling, West Virginia. WesBanco also operates an insurance brokerage company, WesBanco Insurance Services, Inc., and a full service broker/dealer, WesBanco Securities, Inc.

Forward-looking Statements:

Forward-looking statements in this report relating to WesBanco's plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  The information contained in this report should be read in conjunction with WesBanco's Form 10-K for the year ended December 31, 2014 and documents subsequently filed by WesBanco with the Securities and Exchange Commission ("SEC"), including WesBanco's Form 10-Q for the quarters ended March 31, June 30 and September 30, 2015, which are available at the SEC's website, www.sec.gov or at WesBanco's website, www.wesbanco.com.  Investors are cautioned that forward-looking statements, which are not historical fact, involve risks and uncertainties, including those detailed in WesBanco's most recent Annual Report on Form 10-K filed with the SEC under "Risk Factors" in Part I, Item 1A.  Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including, without limitation, the effects of changing regional and national economic conditions; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to WesBanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, the Federal Deposit Insurance Corporation, the SEC, the Financial Institution Regulatory Authority, the Municipal Securities Rulemaking Board, the Securities Investors Protection Corporation, and other regulatory bodies; potential legislative and federal and state regulatory actions and reform, including, without limitation, the impact of the implementation of the Dodd-Frank Act; adverse decisions of federal and state courts; fraud, scams and schemes of third parties; internet hacking; competitive conditions in the financial services industry; rapidly changing technology affecting financial services; marketability of debt instruments and corresponding impact on fair value adjustments; and/or other external developments materially impacting WesBanco's operational and financial performance.  WesBanco does not assume any duty to update forward-looking statements.

 

 

WESBANCO, INC.

Consolidated Selected Financial Highlights

Page 4

(unaudited, dollars in thousands, except shares and per share amounts)

For the Three Months Ended

For the Year Ended

STATEMENT OF INCOME

December 31,

December 31,

Interest and dividend income

2015

2014

% Change

2015

2014

% Change

Loans, including fees

$       52,080

$      43,491

19.7

$    203,993

$     172,182

18.5

Interest and dividends on securities:

Taxable 

10,522

7,181

46.5

39,314

29,233

34.5

Tax-exempt

4,644

3,356

38.4

16,764

13,589

23.4

Total interest and dividends on securities

15,166

10,537

43.9

56,078

42,822

31.0

Other interest income 

414

157

163.7

1,641

987

66.3

          Total interest and dividend income

67,660

54,185

24.9

261,712

215,991

21.2

Interest expense

Interest bearing demand deposits

518

400

29.5

1,943

1,568

23.9

Money market deposits

484

483

0.2

1,914

1,877

2.0

Savings deposits

165

134

23.1

640

532

20.3

Certificates of deposit

2,630

2,980

(11.7)

11,033

13,286

(17.0)

Total interest expense on deposits

3,797

3,997

(5.0)

15,530

17,263

(10.0)

Federal Home Loan Bank borrowings

2,353

318

639.9

5,510

968

469.2

Other short-term borrowings

116

78

48.7

370

1,333

(72.2)

Junior subordinated debt owed to unconsolidated subsidiary trusts

774

806

(4.0)

3,315

3,199

3.6

Total interest expense

7,040

5,199

35.4

24,725

22,763

8.6

Net interest income 

60,620

48,986

23.7

236,987

193,228

22.6

Provision for credit losses

2,585

1,880

37.5

8,353

6,405

30.4

Net interest income after provision for credit losses

58,035

47,106

23.2

228,634

186,823

22.4

Non-interest income

Trust fees

5,244

5,115

2.5

21,900

21,069

3.9

Service charges on deposits

4,401

4,028

9.3

16,743

16,135

3.8

Electronic banking fees

3,691

3,159

16.8

14,361

12,708

13.0

Net securities brokerage revenue

1,795

1,389

29.2

7,692

6,922

11.1

Bank-owned life insurance

1,598

1,037

54.1

4,863

4,614

5.4

Net gains on sales of mortgage loans

612

426

43.7

2,071

1,604

29.1

Net securities gains

880

147

498.6

948

903

5.0

Net gain / (loss) on other real estate owned and other assets

189

212

(10.8)

356

(1,006)

135.4

Other income

1,616

1,047

54.3

5,532

5,555

(0.4)

Total non-interest income

20,026

16,560

20.9

74,466

68,504

8.7

Non-interest expense

Salaries and wages

19,872

16,707

18.9

77,340

67,408

14.7

Employee benefits

6,745

5,229

29.0

26,896

21,518

25.0

Net occupancy

3,336

2,857

16.8

13,635

12,122

12.5

Equipment 

3,506

3,008

16.6

13,194

11,542

14.3

Marketing

1,425

1,250

14.0

5,646

5,242

7.7

FDIC insurance 

1,093

833

31.2

4,107

3,376

21.7

Amortization of intangible assets

811

466

74.0

3,136

1,920

63.3

Restructuring and merger-related expense

48

1,309

(96.3)

11,082

1,309

746.6

Other operating expenses  

10,058

10,313

(2.5)

38,887

37,196

4.5

Total non-interest expense

46,894

41,972

11.7

193,923

161,633

20.0

Income before provision for income taxes

31,167

21,694

43.7

109,177

93,694

16.5

Provision for income taxes 

8,165

5,182

57.6

28,415

23,720

19.8

Net Income

$       23,002

$      16,512

39.3

$       80,762

$       69,974

15.4

Taxable equivalent net interest income

$      63,121

$   50,793

24.3

$    246,014

$  200,545

22.7

Per common share data

Net income per common share - basic

$           0.60

$          0.56

7.1

$           2.15

$           2.39

(10.0)

Net income per common share - diluted

0.60

0.56

7.1

2.15

2.39

(10.0)

Dividends declared

0.23

0.22

4.5

0.92

0.88

4.5

Book value (period end)

29.18

26.90

8.5

Tangible book value (period end) (1)

16.51

16.09

2.6

Average common shares outstanding - basic

38,507,772

29,291,440

31.5

37,488,331

29,249,499

28.2

Average common shares outstanding - diluted

38,538,771

29,383,506

31.2

37,547,127

29,333,876

28.0

Period end common shares outstanding

38,459,635

29,298,188

31.3

38,459,635

29,298,188

31.3

(1) See non-GAAP financial measures for additional information relating to the calculation of this item.

 

 

 

WESBANCO, INC.

Consolidated Selected Financial Highlights

Page 5

(unaudited, dollars in thousands)

Selected ratios

For the Year Ended

December 31,

2015

2014

% Change

Return on average assets

0.99

%

1.12

%

(11.61)

%

Return on average equity

7.62

8.97

(15.05)

Return on average tangible equity (1)

13.41

15.39

(12.87)

Yield on earning assets (2) 

3.75

4.02

(6.72)

Cost of interest bearing liabilities

0.43

0.52

(17.31)

Net interest spread (2)

3.32

3.50

(5.14)

Net interest margin (2)

3.41

3.61

(5.54)

Efficiency (1) (2)

57.05

59.59

(4.26)

Average loans to average deposits

78.53

76.89

2.13

Annualized net loan charge-offs/average loans

0.23

0.23

-

Effective income tax rate 

26.03

25.32

2.80

For the Quarter Ended

Dec. 31,

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

2015

2015

2015

2015

2014

Return on average assets

1.07

%

1.05

%

1.05

%

0.75

%

1.04

%

Return on average equity

8.11

7.96

7.89

5.89

8.17

Return on average tangible equity (1)

14.68

14.58

13.67

10.62

13.77

Yield on earning assets (2) 

3.69

3.70

3.76

3.93

3.96

Cost of interest bearing liabilities

0.47

0.42

0.41

0.43

0.47

Net interest spread (2)

3.22

3.28

3.35

3.50

3.49

Net interest margin (2)

3.32

3.36

3.44

3.59

3.60

Efficiency (1) (2) 

56.34

57.60

56.11

58.24

60.37

Average loans to average deposits

80.66

78.75

76.52

77.98

79.07

Annualized net loan charge-offs/average loans

0.20

0.30

0.25

0.16

0.23

Effective income tax rate 

26.20

25.88

26.90

24.59

23.89

Trust assets, market value at period end

$     3,625,411

$        3,650,043

$        3,843,792

$        3,852,165

$        3,840,540

(1) See non-GAAP financial measures for additional information relating to the calculation of this item.

(2) The yield on earning assets, net interest margin, net interest spread and efficiency ratios are presented on a fully taxable-equivalent (FTE) and annualized basis. The FTE basis adjusts for the tax benefit of income on certain tax-exempt loans and investments. WesBanco believes this measure to be the preferred industry measurement of net interest income and provides a relevant comparison between taxable and non-taxable amounts.

 

 

WESBANCO, INC.

Consolidated Selected Financial Highlights

Page 6

(unaudited, dollars in thousands, except shares)

% Change

Balance sheets

December 31,

Sept. 30,

September 30, 2015

Assets

2015

2014

% Change

2015

to December 31, 2015

Cash and due from banks

$          75,707

$          85,597

(11.6)

$                90,831

(16.7)

Due from banks - interest bearing

10,978

8,405

30.6

2,144

412.0

Securities:

Available-for-sale, at fair value

1,409,520

917,424

53.6

1,559,718

(9.6)

Held-to-maturity (fair values of $1,038,207; $619,617 and $983,997, respectively)

1,012,930

593,670

70.6

957,352

5.8

Total securities

2,422,450

1,511,094

60.3

2,517,070

(3.8)

Loans held for sale

7,899

5,865

34.7

10,765

(26.6)

Portfolio loans:

Commercial real estate

2,256,381

1,945,460

16.0

2,183,338

3.3

Commercial and industrial

737,878

638,410

15.6

725,730

1.7

Residential real estate 

1,247,800

928,770

34.3

1,243,630

0.3

Home equity

416,889

330,031

26.3

403,387

3.3

Consumer 

406,894

244,095

66.7

394,557

3.1

Total portfolio loans, net of unearned income

5,065,842

4,086,766

24.0

4,950,642

2.3

Allowance for loan losses

(41,710)

(44,654)

6.6

(41,624)

(0.2)

Net portfolio loans

5,024,132

4,042,112

24.3

4,909,018

2.3

Premises and equipment, net

112,203

93,135

20.5

111,699

0.5

Accrued interest receivable

25,759

18,481

39.4

27,000

(4.6)

Goodwill and other intangible assets, net

490,888

319,506

53.6

492,725

(0.4)

Bank-owned life insurance

150,980

123,298

22.5

155,894

(3.2)

Other assets

149,302

89,072

67.6

135,284

10.4

Total Assets

$    8,470,298

$   6,296,565

34.5

$         8,452,430

0.2

Liabilities

Deposits:

Non-interest bearing demand

$      1,311,455

$      1,061,075

23.6

$           1,280,329

2.4

Interest bearing demand

1,152,071

885,037

30.2

1,206,837

(4.5)

Money market

967,561

954,957

1.3

1,011,420

(4.3)

Savings deposits

1,077,374

842,818

27.8

1,064,426

1.2

Certificates of deposit

1,557,838

1,305,096

19.4

1,630,890

(4.5)

Total deposits

6,066,299

5,048,983

20.1

6,193,902

(2.1)

Federal Home Loan Bank borrowings

1,041,750

223,126

366.9

893,117

16.6

Other short-term borrowings

81,356

80,690

0.8

84,587

(3.8)

Junior subordinated debt owed to unconsolidated subsidiary trusts

106,196

106,176

0.0

106,196

-

Total borrowings

1,229,302

409,992

199.8

1,083,900

13.4

Accrued interest payable

1,715

1,620

5.9

2,832

(39.4)

Other liabilities

50,850

47,780

6.4

56,054

(9.3)

Total Liabilities

7,348,166

5,508,375

33.4

7,336,688

0.2

Shareholders' Equity

Preferred stock, no par value; 1,000,000 shares authorized; 

none outstanding

-

-

-

-

-

Common stock, $2.0833 par value; 100,000,000 and 50,000,000 shares authorized in 2015

and 2014, respectively; 38,546,042; 29,367,511 and 38,546,042 shares

issued, respectively; 38,459,635; 29,298,188 and 38,517,542 shares

80,304

61,182

31.3

80,304

-

outstanding, respectively

Capital surplus

516,294

244,661

111.0

515,783

0.1

Retained earnings

549,921

504,578

9.0

535,777

2.6

Treasury stock (86,407; 69,323 and 28,500 shares - at cost, respectively)

(2,640)

(2,151)

(22.7)

(890)

(196.6)

Accumulated other comprehensive loss

(20,954)

(18,825)

(11.3)

(14,446)

(45.1)

Deferred benefits for directors

(793)

(1,255)

36.8

(786)

(0.9)

Total Shareholders' Equity

1,122,132

788,190

42.4

1,115,742

0.6

Total Liabilities and Shareholders' Equity

$    8,470,298

$   6,296,565

34.5

$         8,452,430

0.2

 

 

 

WESBANCO, INC.

Consolidated Selected Financial Highlights

Page 7

(unaudited, dollars in thousands)

Average balance sheet and

net interest margin analysis

For the Three Months Ended December 31,

For the Year Ended December 31,

2015

2014

2015

2014

Average 

Average

Average 

Average

Average 

Average

Average 

Average

Assets

Balance

Rate

Balance

Rate

Balance

Rate

Balance

Rate

Due from banks - interest bearing

$            11,647

0.21

%

$              8,042

0.30

%

$            15,467

0.17

%

$            25,713

0.23

%

Loans, net of unearned income (1)

4,999,259

4.13

4,057,138

4.25

4,840,637

4.21

3,953,823

4.35

Securities: (2)

    Taxable

1,861,808

2.26

1,141,069

2.52

1,757,288

2.24

1,158,738

2.52

    Tax-exempt (3)

645,737

4.43

400,470

5.16

568,671

4.54

403,088

5.19

        Total securities

2,507,545

2.82

1,541,539

3.20

2,325,959

2.80

1,561,826

3.21

Other earning assets (4)

39,902

4.09

9,135

6.61

28,721

5.61

11,726

7.91

         Total earning assets (3)

7,558,353

3.69

%

5,615,854

3.96

%

7,210,784

3.75

%

5,553,088

4.02

%

Other assets

934,223

680,428

913,197

700,165

Total Assets

$     8,492,576

$     6,296,282

$     8,123,981

$     6,253,253

Liabilities and Shareholders' Equity

Interest bearing demand deposits

$        1,192,502

0.17

%

$          912,352

0.17

%

$        1,143,965

0.17

%

$          899,887

0.17

%

Money market accounts 

997,850

0.19

979,343

0.20

1,003,980

0.19

972,496

0.19

Savings deposits

1,068,401

0.06

829,215

0.06

1,044,079

0.06

822,221

0.06

Certificates of deposit

1,624,024

0.64

1,335,421

0.89

1,704,871

0.65

1,418,459

0.94

    Total interest bearing deposits

4,882,777

0.31

4,056,331

0.39

4,896,895

0.32

4,113,063

0.42

Federal Home Loan Bank borrowings

881,471

1.06

124,892

1.01

591,506

0.93

81,159

1.19

Other borrowings

119,821

0.38

90,152

0.35

109,165

0.34

101,291

1.32

Junior subordinated debt

106,196

2.89

106,171

3.01

115,088

2.88

106,156

3.01

      Total interest bearing liabilities 

5,990,265

0.47

%

4,377,546

0.47

%

5,712,654

0.43

%

4,401,669

0.52

%

Non-interest bearing demand deposits

1,315,363

1,074,797

1,267,158

1,029,370

Other liabilities

62,189

42,360

84,679

41,791

Shareholders' equity

1,124,759

801,579

1,059,490

780,423

Total Liabilities and Shareholders' Equity

$     8,492,576

$     6,296,282

$     8,123,981

$     6,253,253

Taxable equivalent net interest spread

3.22

%

3.49

%

3.32

%

3.50

%

Taxable equivalent net interest margin 

3.32

%

3.60

%

3.41

%

3.61

%

(1) Gross of allowance for loan losses and net of unearned income.  Includes non-accrual and loans held for sale.  Loan fees included in interest income on loans are $0.8 million and $1.0 million for the three months ended December 31, 2015 and 2014, respectively, and $1.5 million and $3.5 million for the year ended December 31, 2015 and 2014, respectively.  Additionally, loan accretion included in interest income on loans acquired from prior acquisitions was $0.9 million and $0.3 million for the three months ended December 31, 2015 and 2014, respectively, and $3.9 million and $1.4 million for the year ended December 31, 2015 and 2014, respectively, while accretion on  interest bearing liabilities acquired from the prior acquisitions was $0.6 million and $0.1 million for the three months ended December 31, 2015 and 2014, respectively, and $3.4 million and $0.7 million for the year ended December 31, 2015 and 2014, respectively.

(2) Average yields on available-for-sale securities are calculated based on amortized cost.

(3) Taxable equivalent basis is calculated on tax-exempt securities using a rate of 35% for each period presented.

(4) Interest income on other earning assets includes $0.6 million of a special dividend from FHLB Pittsburgh for the year ended December 31, 2015 and $0.5 million of interest on a federal income tax refund for the year ended December 31, 2014.

 

 

 

WESBANCO, INC.

Consolidated Selected Financial Highlights

 Page 8 

(unaudited, dollars in thousands, except shares and per share amounts)

Quarter Ended

Statement of Income

Dec. 31,

Sept. 30,

June 30,

Mar. 31, 

Dec. 31,

Interest income

2015

2015

2015

2015

2014

Loans, including fees

$         52,080

$        51,876

$          52,316

$          47,713

$         43,491

Interest and dividends on securities:

Taxable 

10,522

10,251

10,043

8,498

7,181

Tax-exempt

4,644

4,535

4,052

3,533

3,356

Total interest and dividends on securities

15,166

14,786

14,095

12,031

10,537

Other interest income 

414

273

318

635

157

          Total interest and dividend income

67,660

66,935

66,729

60,379

54,185

Interest expense

Interest bearing demand deposits

518

517

485

422

400

Money market deposits

484

485

490

456

483

Savings deposits

165

165

163

148

134

Certificates of deposit

2,630

2,662

2,869

2,872

2,980

Total interest expense on deposits

3,797

3,829

4,007

3,898

3,997

Federal Home Loan Bank borrowings

2,353

1,650

949

557

318

Other short-term borrowings

116

89

92

75

78

Junior subordinated debt owed to unconsolidated subsidiary trusts

774

758

888

894

806

Total interest expense

7,040

6,326

5,936

5,424

5,199

Net interest income 

60,620

60,609

60,793

54,955

48,986

Provision for credit losses

2,585

1,798

2,681

1,289

1,880

Net interest income after provision for credit losses

58,035

58,811

58,112

53,666

47,106

Non-interest income

Trust fees

5,244

5,127

5,476

6,053

5,115

Service charges on deposits

4,401

4,425

4,249

3,652

4,028

Electronic banking fees

3,691

3,849

3,496

3,325

3,159

Net securities brokerage revenue

1,795

1,996

1,842

2,059

1,389

Bank-owned life insurance

1,598

1,021

989

1,251

1,037

Net gains on sales of mortgage loans

612

779

407

272

426

Net securities gains

880

47

-

22

147

Net gain / (loss) on other real estate owned and other assets

189

(18)

152

122

212

Other income

1,616

960

1,461

1,434

1,047

Total non-interest income

20,026

18,186

18,072

18,190

16,560

Non-interest expense

Salaries and wages

19,872

19,832

19,300

18,357

16,707

Employee benefits

6,745

6,028

6,807

7,316

5,229

Net occupancy

3,336

3,533

3,243

3,490

2,857

Equipment 

3,506

3,731

3,017

2,973

3,008

Marketing

1,425

1,514

1,715

965

1,250

FDIC insurance 

1,093

1,064

1,040

910

833

Amortization of intangible assets

811

815

944

566

466

Restructuring and merger-related expense

48

185

1,115

9,733

1,309

Other operating expenses  

10,058

10,279

9,408

9,131

10,313

Total non-interest expense

46,894

46,981

46,589

53,441

41,972

Income before provision for income taxes

31,167

30,016

29,595

18,415

21,694

Provision for income taxes 

8,165

7,768

7,962

4,528

5,182

Net Income

$           23,002

$         22,248

$          21,633

$          13,887

$         16,512

Taxable equivalent net interest income

$          63,121

$         63,051

$         62,975

$         56,857

$        50,793

Per common share data

Net income per common share - basic

$               0.60

$           0.58

$              0.56

$              0.40

$             0.56

Net income per common share - diluted

$               0.60

$           0.58

$              0.56

$              0.40

$             0.56

Dividends declared

$               0.23

$           0.23

$              0.23

$              0.23

$             0.22

Book value (period end)

$             29.18

$         28.97

$            28.42

$            28.38

$           26.90

Tangible book value (period end) (1)

$             16.51

$         16.27

$            15.72

$            15.67

$           16.09

Average common shares outstanding - basic

38,507,772

38,523,593

38,472,229

34,393,137

29,291,440

Average common shares outstanding - diluted

38,538,771

38,556,995

38,531,700

34,478,335

29,383,506

Period end common shares outstanding

38,459,635

38,517,542

38,519,170

38,449,812

29,298,188

Full time equivalent employees

1,633

1,637

1,667

1,713

1,448

(1) See non-GAAP financial measures for additional information relating to the calculation of this item.

 

 

 

WESBANCO, INC.

Consolidated Selected Financial Highlights

 Page 9 

(unaudited, dollars in thousands)

Quarter Ended

Dec. 31, 

Sept. 30,

June 30,

Mar. 31,

Dec. 31, 

Asset quality data

2015

2015

2015

2015

2014

Non-performing assets:

Troubled debt restructurings - accruing

$ 11,548

$ 12,030

$ 12,958

$ 17,330

$ 12,066

Non-accrual loans:

Troubled debt restructurings

12,354

12,661

13,140

9,224

5,420

Other non-accrual loans

28,764

28,633

35,064

32,150

33,398

    Total non-accrual loans

41,118

41,294

48,204

41,374

38,818

    Total non-performing loans 

52,666

53,324

61,162

58,704

50,884

Other real estate and repossessed assets

5,825

6,062

6,168

6,226

5,082

Total non-performing assets

$ 58,491

$ 59,386

$ 67,330

$ 64,930

$ 55,966

Past due loans (1):

Loans past due 30-89 days

$ 11,005

$ 12,422

$ 10,320

$ 12,003

$   9,347

Loans past due 90 days or more

3,126

6,079

2,471

1,031

2,288

Total past due loans

$ 14,131

$ 18,501

$ 12,791

$ 13,034

$ 11,635

Criticized and classified loans (2):

Criticized loans

$ 26,298

$ 32,253

$ 28,280

$ 40,659

$ 34,288

Classified loans

53,408

49,204

54,645

52,295

46,851

Total criticized and classified loans

$ 79,706

$ 81,457

$ 82,925

$ 92,954

$ 81,139

Loans past due 30-89 days / total portfolio loans

0.22

%

0.25

%

0.21

%

0.25

%

0.23

%

Loans past due 90 days or more / total portfolio loans

0.06

0.12

0.05

0.02

0.06

Non-performing loans / total portfolio loans

1.04

1.08

1.24

1.20

1.25

Non-performing assets/total portfolio loans, other

real estate and repossessed assets

1.15

1.20

1.36

1.33

1.37

Non-performing assets / total assets

0.69

0.70

0.80

0.79

0.89

Criticized and classified loans / total portfolio loans

1.57

1.65

1.68

1.91

1.99

Allowance for loan losses

Allowance for loan losses

$ 41,710

$ 41,624

$ 43,419

$ 44,173

$ 44,654

Provision for credit losses

2,585

1,798

2,681

1,289

1,880

Net loan and deposit account overdraft charge-offs

2,516

3,768

3,108

1,747

2,332

Annualized net loan charge-offs /average loans

0.20

%

0.30

%

0.25

%

0.16

%

0.23

%

Allowance for loan losses / total portfolio loans

0.82

%

0.84

%

0.88

%

0.91

%

1.09

%

Allowance for loan losses / non-performing loans

0.79

x

0.78

x

0.71

x

0.75

x

0.88

x

Allowance for loan losses / non-performing loans and

loans past due 

0.62

x

0.58

x

0.59

x

0.62

x

0.71

x

Quarter Ended

Dec. 31, 

Sept. 30,

June 30,

Mar. 31,

Dec. 31, 

2015

2015

2015

2015

2014

Capital ratios

Tier I leverage capital

9.38

%

9.39

%

9.29

%

10.62

%

9.88

%

Tier I risk-based capital

13.39

13.69

13.47

14.09

13.76

Total risk-based capital

14.15

14.48

14.30

14.92

14.81

Common equity tier 1 capital ratio (CET 1)

11.70

11.93

11.71

11.49

Average shareholders' equity to average assets

13.24

13.20

13.29

12.71

12.73

Tangible equity to tangible assets (3)

7.95

7.87

7.68

7.78

7.88

(1) Excludes non-performing loans.

(2) Criticized and classified loans may include loans that are also reported as non-performing or past due.

(3) See non-GAAP financial measures for additional information relating to the calculation of this ratio.

 

 

 

NON-GAAP FINANCIAL MEASURES

Page 10

The following non-GAAP financial measures used by WesBanco provide information useful to investors in understanding WesBanco's operating performance and trends, and facilitate comparisons with the performance of WesBanco's peers. The following tables summarize the non-GAAP financial measures derived from amounts reported in WesBanco's financial statements.

Three Months Ended

Year to Date 

(unaudited, dollars in thousands,

Dec. 31,

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Dec. 31,

except shares and per share amounts)

2015

2015

2015

2015

2014

2015

2014

Return on average tangible equity:

Net income (annualized)

$      91,258

$      88,267

$      86,770

$      56,319

$      65,510

$    80,762

$   69,974

Plus: amortization of intangibles (annualized) (1)

2,091

2,102

2,462

1,491

1,202

2,038

1,248

Net income before amortization of intangibles (annualized)

93,349

90,369

89,232

57,810

66,712

82,800

71,222

Average total shareholders' equity

1,124,759

1,108,616

1,100,302

956,836

801,579

1,059,490

780,423

Less: average goodwill and other intangibles, net of def. tax liability

(488,677)

(488,726)

(447,709)

(412,454)

(317,061)

(442,215)

(317,523)

Average tangible equity

$    636,082

$    619,890

$    652,593

$    544,382

$    484,518

$  617,275

$ 462,900

Return on average tangible equity

14.68%

14.58%

13.67%

10.62%

13.77%

13.41%

15.39%

Efficiency ratio:

Non-interest expense

$      46,894

$      46,981

$      46,589

$      53,441

$      41,972

$  193,923

$ 161,633

Less: restructuring and merger-related expense

(48)

(185)

(1,115)

(9,733)

(1,309)

(11,082)

(1,309)

Non-interest expense excluding restructuring and merger-related expense

46,846

46,796

45,474

43,708

40,663

182,841

160,324

Net interest income on a fully taxable equivalent basis

63,121

63,051

62,975

56,857

50,793

246,014

200,545

Non-interest income

20,026

18,186

18,072

18,190

16,560

74,466

68,504

Net interest income on a fully taxable equivalent basis plus non-interest income

$      83,147

$      81,237

$      81,047

$      75,047

$      67,353

$  320,480

$ 269,049

Efficiency Ratio

56.34%

57.60%

56.11%

58.24%

60.37%

57.05%

59.59%

Net Income, excluding after-tax merger-related expenses:

Net income 

$      23,002

$      22,248

$      21,633

$      13,887

$      16,512

$    80,762

$   69,974

Add: After-tax merger-related expenses (1)

31

120

725

6,326

851

7,203

851

Net income, excluding after-tax merger-related expenses

$      23,033

$      22,368

$      22,358

$      20,213

$      17,363

$    87,965

$   70,825

Net Income, excluding after-tax merger-related expenses per diluted share:

Net income per diluted share

$          0.60

$          0.58

$          0.56

$          0.40

$          0.56

$        2.15

$       2.39

Add: After-tax merger-related expenses per diluted share (1)

-

-

0.02

0.19

0.03

0.19

0.03

Net income, excluding after-tax merger-related expenses per diluted share

$          0.60

$          0.58

$          0.58

$          0.59

$          0.59

$        2.34

$       2.41

Period End

Dec. 31,

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

2015

2015

2015

2015

2014

Tangible book value:

Total shareholders' equity

$ 1,122,132

$ 1,115,742

$ 1,094,653

$ 1,091,384

$    788,190

Less:  goodwill and other intangible assets, net of def. tax liability

(487,270)

(488,893)

(488,949)

(488,911)

(316,914)

Tangible equity

634,862

626,849

605,704

602,473

471,276

Common shares outstanding

38,459,635

38,517,542

38,519,170

38,449,812

29,298,188

Tangible book value

$        16.51

$        16.27

$        15.72

$        15.67

$        16.09

Tangible equity to tangible assets:

Total shareholders' equity

$ 1,122,132

$ 1,115,742

$ 1,094,653

$ 1,091,384

$    788,190

Less:  goodwill and other intangible assets, net of def. tax liability

(487,270)

(488,893)

(488,949)

(488,911)

(316,914)

Tangible equity

634,862

626,849

605,704

602,473

471,276

Total assets

8,470,298

8,452,430

8,375,419

8,233,279

6,296,565

Less:  goodwill and other intangible assets, net of def. tax liability

(487,270)

(488,893)

(488,949)

(488,911)

(316,914)

Tangible assets

$ 7,983,028

$ 7,963,537

$ 7,886,470

$ 7,744,368

$ 5,979,651

Tangible equity to tangible assets

7.95%

7.87%

7.68%

7.78%

7.88%

(1) Tax effected at 35%.

 

 

 

SOURCE WesBanco, Inc.



RELATED LINKS

http://www.wesbanco.com