WesBanco Announces Increased Earnings

WHEELING, W.Va., Oct. 23, 2012 /PRNewswire/ -- Paul M. Limbert, President and Chief Executive Officer of WesBanco, Inc. (NASDAQ Global Market: WSBC), a Wheeling, West Virginia based multi-state bank holding company, today announced increased earnings for the three and nine months ended September 30, 2012.

Net income for the quarter ended September 30, 2012 was $12.9 million compared to $11.0 million for the same period of 2011, representing an increase of 17.2%, while diluted earnings per share were $0.48, as compared to $0.41 per share for the third quarter of 2011.  For the nine month period ended September 30, 2012, net income was $36.9 million as compared to $33.2 million for the same period in 2011, representing an increase of 11.2%, while diluted earnings per share were $1.38, as compared to $1.25 per share for the nine months ended September 30, 2011.

Mr. Limbert commented, "The third quarter of 2012 included many accomplishments resulting in solid growth in WesBanco earnings.  The second consecutive quarter of loan growth and reductions in the cost of funds provided an increase in net interest income compared to last quarter.  Credit quality improvements have resulted in a lower loan loss provision in this quarter which contributed to improved earnings.  Credit quality continues to improve with non-performing loans decreasing in each of the last three quarters while criticized and classified loans have decreased for four consecutive quarters.

"We are pleased with our progress in the acquisition process of Fidelity Bancorp, Inc. ("Fidelity").  The transaction is moving through the regulatory approval process and we anticipate a shareholder meeting for Fidelity's shareholders on November 27, 2012 to consider the transaction."

Net Interest Income

Net interest income continues to be affected by the low interest rate environment and competition; however WesBanco has been able to maintain a relatively stable net interest margin for the first nine months of 2012 in the range of 3.5% to 3.6%.  Net interest income increased 0.4% to $41.7 million in the third quarter of 2012 compared to the second quarter of 2012 due to portfolio loan growth in both the second and third quarters of the current year.  Average loans increased $79.6 million or 2.4% in the third quarter compared to the second quarter of 2012.  Net interest income decreased $1.2 million or 2.8% in the third quarter of 2012 and $2.4 million in the first nine months of 2012 compared to the same periods in 2011 due to the low interest rate environment. However, average earning assets increased $102.5 million or 2.1% in the third quarter and 2.5% in the year-to-date period, including the growth in portfolio loans, while the cost of funds continued to decline as a result of lower rates paid on deposit accounts, growth in non-interest bearing and lower-cost demand deposits, and a reduction in higher-cost FHLB borrowings.

Provision and Allowance for Credit Losses

WesBanco has continued to improve credit quality during the third quarter of 2012.  The provision for credit losses was $4.5 million and $16.6 million for the third quarter and first nine months of 2012, respectively, compared to $10.8 million and $25.7 million for the same periods of 2011.  The third quarter provision decreased $1.4 million compared to the previous quarter.  The decrease in the provision is supported by reductions in net charge-offs, as well as non-performing, classified and criticized loans.  Total non-performing loans represented 1.76% of total loans at September 30, 2012 compared to 2.08% at June 30, 2012 and 2.60% at September 30, 2011.  The allowance for loan losses to non-performing loans, loans past due and classified and criticized loans at September 30, 2012 is at the highest level in over two years.

Total non-performing loans at September 30, 2012 decreased $9.0 million or 13.2% from June 30, 2012 and $25.1 million or 29.8% from September 30, 2011.  Classified and criticized loans decreased $25.9 million or 11.6% from June 30, 2012 and $73.3 million or 27.1% from September 30, 2011.  Loan sales in the third quarter decreased non-performing loans by $4.2 million and classified and criticized loans by $5.1 million. From September 30, 2011, loan sales decreased non-performing loans by $9.3 million and classified and criticized loans by $10.2 million. Loans past due 30 days or more and accruing interest represented 0.62% of total portfolio loans at September 30, 2012 compared to 0.93% at September 30, 2011.  Net charge-offs for the third quarter of 2012 were $4.6 million compared to $6.8 million for the previous quarter and $17.4 million for the third quarter of 2011.  Net charge-offs for the first nine months of 2012 were $18.0 million compared to $32.6 million for the same period of 2011.  Annualized net charge-offs for the third quarter and first nine months of 2012 represent 0.54% and 0.73% of average portfolio loans, respectively, compared to 2.11% and 1.33% for the same periods of 2011. 

Non-Interest Income and Non-Interest Expense

Non-interest income increased $1.4 million or 9.3% in the third quarter of 2012 and $3.1 million or 6.9% in the nine month period ended September 30, 2012 compared to the same periods in 2011.  For the third quarter of 2012, trust fees increased 11.1% as an organization-wide coordination of trust and investment development activities increased assets under management.  Net gains on sales of mortgage loans increased $0.7 million in the third quarter and $0.6 million year-to-date due to increased volume and margins on loans sold.  Electronic banking fees increased 6.2% in the third quarter and 13.9% in the first nine months of 2012 due to increased transaction volumes.  The net gain (loss) on other real estate owned improved $0.7 million in the year-to-date period.  Net security gains were $0.3 million in the third quarter and $1.7 million year-to-date. These improvements were partially offset by decreases in service charges on deposits of $0.5 million in the third quarter and $1.4 million in the first nine months of 2012, primarily from decreases in customer overdraft fees.

Non-interest expense increased by 3.6% in the first nine months of 2012 compared to the same period in 2011 due to $1.5 million recorded in the third quarter for restructuring and merger-related expenses.  Expenses related to the Fidelity merger were $0.7 million and restructuring costs associated with the pending closure of six branch offices in the fourth quarter were $0.8 million.  In addition, salaries and wages increased $1.0 million due to routine annual adjustments to compensation, and employee benefits expense increased $2.7 million from increased pension and employee health insurance costs.  Partially offsetting these increases were reduced FDIC insurance of $0.8 million, and reductions in many other expense categories.

Financial Condition

Total assets at September 30, 2012 increased 1.4% or $74.8 million over the comparable period in 2011 and increased $40.9 million from the prior year-end.  Increases over the last year were primarily from increases in portfolio loans of $112.6 million or 3.5%, most of which occurred in the second and third quarters of 2012. The loan increases and declines in FHLB borrowings were funded by deposit growth and decreases in cash and investments in securities.  Portfolio loans increased as a result of growth in commercial, commercial real estate and residential mortgage lending.  Loan production increased 29.6% in the first nine months of 2012 compared to the same period of 2011. 

WesBanco continued to strengthen its regulatory capital ratios with tier I leverage at 9.11%, tier I risk-based capital at 13.20%, and total risk-based capital at 14.45%, all of which consistently improved over the last three years.  Both consolidated and bank-level regulatory capital ratios are well above the applicable "well-capitalized" standards promulgated by bank regulators.  Total tangible equity to tangible assets (non-GAAP measure) was 7.13% at September 30, 2012, a 41 basis point increase from a year ago.  WesBanco recently increased its quarterly dividend $0.01 per share to $0.18 per share which was paid on October 1, 2012.  This is the fourth increase in the last 18 months representing a total increase in the dividend of 29% during this period.

On July 19, 2012, WesBanco and Fidelity, a Pittsburgh-based bank with $0.7 billion in assets and 13 branches, jointly announced that a definitive Agreement and Plan of Merger was executed providing for the merger of Fidelity with and into WesBanco. Under the terms of the Agreement and Plan of Merger, WesBanco will exchange 0.8275 shares of its common stock and $4.50 in cash for each share of Fidelity common stock. The receipt by Fidelity shareholders of shares of WesBanco common stock in exchange for their shares of Fidelity common stock is anticipated to qualify as a tax-free exchange. WesBanco expects the combination to be accretive to 2013 earnings per share, excluding merger-related expenses. The transaction, approved by the directors of both companies, currently is valued at approximately $68.7 million. The acquisition is subject to the approvals of the appropriate banking regulatory authorities and the shareholders of Fidelity. It is currently anticipated that the transaction will be completed on or about December 31, 2012.

WesBanco is a multi-state bank holding company with total assets of approximately $5.6 billion, operating through 112 branch locations and 104 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, 2011 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, 2012 and June 30, 2012, respectively, 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, that the businesses of WesBanco and Fidelity may not be integrated successfully or such integration may take longer to accomplish than expected; the expected cost savings and any revenue synergies from the merger of WesBanco and Fidelity may not be fully realized within the expected timeframes; disruption from the merger of WesBanco and Fidelity may make it more difficult to maintain relationships with clients, associates, or suppliers; 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.

Additional Information About the Merger and Where to Find It

In connection with the proposed Merger, WesBanco filed with the SEC a Registration Statement on Form S-4 that became effective October 18, 2012 that includes a Proxy Statement of Fidelity and a Prospectus of WesBanco, as well as other relevant documents concerning the proposed transaction. INVESTORS AND OTHER INTERESTED PARTIES ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE MERGER AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. The Proxy Statement/Prospectus will be mailed to shareholders of Fidelity prior to the Fidelity shareholder meeting, which will be held on November 27, 2012. In addition, the Registration Statement on Form S-4, which includes the Proxy Statements/Prospectus, and other related documents may be obtained for free at the SEC's website at http://www.sec.gov, on the NASDAQ website at http://www.nasdaq.com and from either WesBanco's or Fidelity's website at http://www.wesbanco.com or http://www.fidelitybancorp-pa.com, respectively.

WesBanco and Fidelity and their respective executive officers and directors may be deemed to be participants in the solicitation of proxies from the shareholders of Fidelity in connection with the proposed Merger. Information about the directors and executive officers of Fidelity will be included in the Proxy Statement/Prospectus and may be found in the proxy statement for Fidelity's annual meeting of shareholders filed with the SEC on January 11, 2012. Information about any other persons who may, under the rules of the SEC, be considered participants in the solicitation of Fidelity shareholders in connection with the proposed Merger will be included in the Proxy Statement/Prospectus. You can find information about WesBanco's directors and executive officers in the proxy statement for WesBanco's annual meeting of shareholders filed with the SEC on March 14, 2012. You can obtain free copies of these documents from the SEC, WesBanco or Fidelity using the website information above.

INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS CAREFULLY BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS WITH RESPECT TO THE PROPOSED MERGER.

This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities.

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 Nine Months Ended

STATEMENT OF INCOME

September 30,


September 30,

Interest and dividend income

2012


2011


% Change


2012


2011


% Change


Loans, including fees

$             41,423


$           44,191


(6.26%)


$       124,345


$         133,051


(6.54%)


Interest and dividends on securities:














Taxable 

7,722


9,032


(14.50%)


24,784


27,171


(8.79%)



Tax-exempt

3,113


3,019


3.11%


9,270


9,051


2.42%




Total interest and dividends on securities

10,835


12,051


(10.09%)


34,054


36,222


(5.99%)


Other interest income 

30


45


(33.33%)


115


154


(25.32%)

          Total interest and dividend income

52,288


56,287


(7.10%)


158,514


169,427


(6.44%)

Interest expense













Interest bearing demand deposits

397


462


(14.07%)


1,132


1,673


(32.34%)


Money market deposits

487


1,121


(56.56%)


1,786


3,693


(51.64%)


Savings deposits

202


332


(39.16%)


697


1,169


(40.38%)


Certificates of deposit

6,450


7,728


(16.54%)


20,050


23,707


(15.43%)




Total interest expense on deposits

7,536


9,643


(21.85%)


23,665


30,242


(21.75%)


Federal Home Loan Bank borrowings

1,020


1,714


(40.49%)


3,684


5,743


(35.85%)


Other short-term borrowings

1,169


1,220


(4.18%)


3,503


3,590


(2.42%)


Junior subordinated debt owed to unconsolidated subsidiary trusts

869


809


7.42%


2,598


2,421


7.31%




Total interest expense

10,594


13,386


(20.86%)


33,450


41,996


(20.35%)

Net interest income 

41,694


42,901


(2.81%)


125,064


127,431


(1.86%)


Provision for credit losses

4,497


10,836


(58.50%)


16,602


25,680


(35.35%)

Net interest income after provision for credit losses

37,197


32,065


16.00%


108,462


101,751


6.60%

Non-interest income













Trust fees

4,379


3,941


11.11%


13,390


12,975


3.20%


Service charges on deposits

4,362


4,881


(10.63%)


12,574


13,992


(10.13%)


Electronic banking fees

2,846


2,679


6.23%


8,529


7,486


13.93%


Net securities brokerage revenue

1,131


1,182


(4.31%)


3,319


3,365


(1.37%)


Bank-owned life insurance

891


908


(1.87%)


2,646


2,703


(2.11%)


Net gains on sales of mortgage loans

993


327


203.67%


1,860


1,298


43.30%


Net securities gains

316


67


371.64%


1,711


97


1663.92%


Net loss on other real estate owned and other assets

(48)


(162)


70.37%


(298)


(978)


69.53%


Other income

1,092


776


40.72%


3,447


3,182


8.33%




Total non-interest income

15,962


14,599


9.34%


47,178


44,120


6.93%

Non-interest expense













Salaries and wages

14,758


14,427


2.29%


43,028


42,040


2.35%


Employee benefits

5,000


3,462


44.43%


15,538


12,866


20.77%


Net occupancy

2,654


3,068


(13.49%)


8,133


8,450


(3.75%)


Equipment 

2,300


2,107


9.16%


6,617


6,552


0.99%


Marketing

795


1,214


(34.51%)


3,282


3,861


(15.00%)


FDIC insurance 

951


1,091


(12.83%)


2,962


3,760


(21.22%)


Amortization of intangible assets

519


599


(13.36%)


1,580


1,822


(13.28%)


Restructuring and merger-related expense

1,518


-


100.00%


1,518


-


100.00%


Other operating expenses  

8,295


7,639


8.59%


25,880


25,450


1.69%




Total non-interest expense

36,790


33,607


9.47%


108,538


104,801


3.57%

Income before provision for income taxes

16,369


13,057


25.37%


47,102


41,070


14.69%


Provision for income taxes 

3,463


2,044


69.42%


10,208


7,898


29.25%

Net Income

$             12,906


$           11,013


17.19%


$         36,894


$           33,172


11.22%
















Taxable equivalent net interest income

$            43,370


$         44,526


(2.60%)


$      130,056


$      132,304


(1.70%)
















Per common share data












Net income per common share - basic

$                 0.48


$               0.41


17.07%


$              1.38


$               1.25


10.40%

Net income per common share - diluted

$                 0.48


$               0.41


17.07%


$              1.38


$               1.25


10.40%

Dividends declared

$                 0.18


$               0.16


12.50%


$              0.52


$               0.46


13.04%

Book value (period end)







$            24.73


$             23.82


3.82%

Tangible book value (period end) (1)







$            14.17


$             13.17


7.59%

Average common shares outstanding - basic

26,664,882


26,629,360


0.13%


26,646,719


26,609,755


0.14%

Average common shares outstanding - diluted

26,672,849


26,629,543


0.16%


26,651,322


26,610,347


0.15%

Period end common shares outstanding

26,665,519


26,629,360


0.14%


26,665,519


26,629,360


0.14%
















(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 Nine Months Ended



September 30,




2012


2011


% Change

















Return on average assets

0.89

%

0.82

%

8.54

%





Return on average equity

7.61


7.15


6.43






Return on average tangible equity (1)

13.87


13.68


1.39






Yield on earning assets (2) 

4.44


4.86


(8.64)






Cost of interest bearing liabilities

1.08


1.36


(20.59)






Net interest spread (2)

3.36


3.50


(4.00)






Net interest margin (2)

3.53


3.69


(4.34)






Efficiency (1) (2) 

60.38


59.40


1.65






Average loans to average deposits

74.07


77.02


(3.83)






Annualized net loan charge-offs/average loans

0.73


1.33


(45.11)






Effective income tax rate 

21.67


19.23


12.69



















































For the Quarter Ended



Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Sept. 30,



2012


2012


2012


2011


2011













Return on average assets

0.92

%

0.87

%

0.87

%

0.77

%

0.80

%

Return on average equity

7.83


7.45


7.54


6.61


6.92


Return on average tangible equity (1)

14.09


13.57


13.93


12.31


13.03


Yield on earning assets (2) 

4.37


4.43


4.54


4.61


4.78


Cost of interest bearing liabilities

1.03


1.07


1.14


1.22


1.28


Net interest spread (2)

3.34


3.36


3.40


3.39


3.50


Net interest margin (2)

3.51


3.53


3.57


3.56


3.67


Efficiency (1) (2) 

59.45


61.06


60.64


59.81


56.84


Average loans to average deposits

74.95


73.35


73.88


74.31


76.55


Annualized net loan charge-offs/average loans

0.54


0.84


0.82


1.22


2.11


Effective income tax rate 

21.16


22.33


21.56


15.42


15.65


Trust assets, market value at period end

$     3,236,618


$        3,133,741


$        3,164,235


$        2,973,352


$        2,789,218













(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

September 30,




December 31,

December 31, 2011


Assets

2012


2011


% Change


2011

to September 30, 2012


Cash and due from banks

$          97,736


$        126,437


(22.70)

%

$              129,396

(24.47)

%

Due from banks - interest bearing

18,675


19,081


(2.13)


10,929

70.88


Securities:











Available-for-sale, at fair value

993,754


952,065


4.38


1,016,340

(2.22)



Held-to-maturity (fair values of $598,854; $631,405 and $621,472, respectively)

559,156


604,994


(7.58)


592,925

(5.70)



               Total securities

1,552,910


1,557,059


(0.27)


1,609,265

(3.50)


Loans held for sale

14,225


8,139


74.78


6,084

133.81


Portfolio loans:











Commercial real estate

1,717,241


1,697,791


1.15


1,685,565

1.88



Commercial and industrial

447,767


426,165


5.07


426,315

5.03



Residential real estate 

684,016


612,647


11.65


621,383

10.08



Home equity

255,787


250,867


1.96


251,785

1.59



Consumer 

248,155


252,908


(1.88)


254,320

(2.42)


Total portfolio loans, net of unearned income

3,352,966


3,240,378


3.47


3,239,368

3.51


Allowance for loan losses

(53,476)


(55,098)


2.94


(54,810)

2.43



Net portfolio loans

3,299,490


3,185,280


3.59


3,184,558

3.61


Premises and equipment, net

80,176


83,198


(3.63)


82,204

(2.47)


Accrued interest receivable

19,171


20,837


(8.00)


19,268

(0.50)


Goodwill and other intangible assets, net

281,570


283,737


(0.76)


283,150

(0.56)


Bank-owned life insurance

112,720


109,204


3.22


110,074

2.40


Other assets

100,286


109,186


(8.15)


101,102

(0.81)


Total Assets

$    5,576,959


$   5,502,158


1.36

%

$         5,536,030

0.74

%











Liabilities










Deposits:











Non-interest bearing demand

$         760,308


$        676,724


12.35

%

$              705,415

7.78

%


Interest bearing demand

784,748


668,606


17.37


698,114

12.41



Money market

778,121


806,854


(3.56)


789,036

(1.38)



Savings deposits

649,959


587,263


10.68


596,549

8.95



Certificates of deposit

1,515,076


1,616,961


(6.30)


1,604,752

(5.59)




Total deposits

4,488,212


4,356,408


3.03


4,393,866

2.15


Federal Home Loan Bank borrowings

91,617


176,581


(48.12)


168,186

(45.53)


Other short-term borrowings

186,886


192,780


(3.06)


196,887

(5.08)


Junior subordinated debt owed to unconsolidated subsidiary trusts

106,091


106,058


0.03


106,066

0.02




Total borrowings

384,594


475,419


(19.10)


471,139

(18.37)


Accrued interest payable

4,628


5,772


(19.82)


4,975

(6.97)


Other liabilities

40,203


30,157


33.31


32,260

24.62


Total Liabilities

4,917,637


4,867,756


1.02


4,902,240

0.31












Shareholders' Equity










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











none outstanding

-


-


-


-

-


Common stock, $2.0833 par value; 50,000,000 shares authorized;











26,667,739 shares; 26,633,848 shares and 26,633,848 shares issued, respectively; 











26,665,519 shares; 26,629,360 shares and 26,629,360 shares outstanding, respectively

55,558


55,487


0.13


55,487

0.13


Capital surplus

192,159


191,471


0.36


191,679

0.25


Retained earnings

411,853


382,442


7.69


388,818

5.92


Treasury stock (2,220; 4,488 and 4,488 shares - at cost, 











respectively)

(44)


(96)


54.17


(96)

54.17


Accumulated other comprehensive income

1,019


6,287


(83.79)


(902)

212.97


Deferred benefits for directors

(1,223)


(1,189)


(2.86)


(1,196)

(2.26)


Total Shareholders' Equity

659,322


634,402


3.93


633,790

4.03


Total Liabilities and Shareholders' Equity

$    5,576,959


$   5,502,158


1.36

%

$         5,536,030

0.74

%











 

 

WESBANCO, INC.





Consolidated Selected Financial Highlights



Page 7


(unaudited, dollars in thousands, except shares)





Balance sheets

September 30,


June 30,



Assets

2012


2012

% Change


Cash and due from banks

$          97,736


$                99,930

(2.20)

%

Due from banks - interest bearing

18,675


2,885

547.31


Securities:







Available-for-sale, at fair value

993,754


1,023,124

(2.87)



Held-to-maturity (fair values of $598,854 and $607,032, respectively)

559,156


572,671

(2.36)



    Total securities

1,552,910


1,595,795

(2.69)


Loans held for sale

14,225


7,305

94.73


Portfolio loans:







Commercial real estate

1,717,241


1,695,045

1.31



Commercial and industrial

447,767


420,689

6.44



Residential real estate 

684,016


662,556

3.24



Home equity

255,787


250,988

1.91



Consumer 

248,155


246,552

0.65


Total portfolio loans, net of unearned income

3,352,966


3,275,830

2.35


Allowance for loan losses

(53,476)


(53,610)

0.25



    Net portfolio loans

3,299,490


3,222,220

2.40


Premises and equipment, net

80,176


80,668

(0.61)


Accrued interest receivable

19,171


18,233

5.14


Goodwill and other intangible assets, net

281,570


282,088

(0.18)


Bank-owned life insurance

112,720


111,829

0.80


Other assets

100,286


104,452

(3.99)


Total Assets

$    5,576,959


$         5,525,405

0.93

%







Liabilities






Deposits:







Non-interest bearing demand

$         760,308


$              759,779

0.07

%


Interest bearing demand

784,748


728,521

7.72



Money market

778,121


753,964

3.20



Savings deposits

649,959


646,385

0.55



Certificates of deposit

1,515,076


1,505,133

0.66



    Total deposits

4,488,212


4,393,782

2.15


Federal Home Loan Bank borrowings

91,617


141,877

(35.43)


Other short-term borrowings

186,886


191,275

(2.29)


Junior subordinated debt owed to unconsolidated subsidiary trusts

106,091


106,083

0.01



    Total borrowings

384,594


439,235

(12.44)


Accrued interest payable

4,628


4,741

(2.38)


Other liabilities

40,203


38,535

4.33


Total Liabilities

4,917,637


4,876,293

0.85








Shareholders' Equity






Preferred stock, no par value; 1,000,000
  shares authorized; 
none outstanding






-


-

-


Common stock, $2.0833 par value; 50,000,000
  shares authorized;
26,667,739 shares and
  26,667,739 shares issued, respectively;

  26,665,519 and 26,664,644 shares
  outstanding, respectively











55,558


55,558

-


Capital surplus

192,159


191,926

0.12


Retained earnings

411,853


403,746

2.01


Treasury stock (2,220 and 3,095 shares - at cost)

(44)


(61)

27.87


Accumulated other comprehensive income

1,019


(843)

220.88


Deferred benefits for directors

(1,223)


(1,214)

(0.74)


Total Shareholders' Equity

659,322


649,112

1.57


Total Liabilities and Shareholders' Equity

$    5,576,959


$         5,525,405

0.93

%







 

WESBANCO, INC.










Consolidated Selected Financial Highlights









Page 8

(unaudited, dollars in thousands)










Average balance sheet and











net interest margin analysis

For the Three Months Ended September 30,


For the Nine Months Ended September 30,






2012


2011


2012


2011






Average 

Average


Average 

Average


Average 

Average


Average 

Average

Assets





Balance

Rate


Balance

Rate


Balance

Rate


Balance

Rate

Due from banks - interest bearing

$            23,504

0.17%


$            51,860

0.18%


$            28,407

0.23%


$            47,280

0.19%

Loans, net of unearned income (1)

3,327,666

4.95%


3,276,095

5.35%


3,275,987

5.07%


3,263,317

5.45%

Securities: (2)












    Taxable

1,226,207

2.52%


1,170,868

3.09%


1,268,739

2.60%


1,156,706

3.13%

    Tax-exempt (3)

326,722

5.86%


297,595

6.24%


318,210

5.98%


297,412

6.24%

        Total securities

1,552,929

3.22%


1,468,463

3.73%


1,586,949

3.28%


1,454,118

3.77%

Other earning assets

18,904

0.42%


24,087

0.36%


20,448

0.44%


25,748

0.45%

         Total earning assets (3)

4,923,003

4.37%


4,820,505

4.78%


4,911,791

4.44%


4,790,463

4.86%

Other assets

633,380



632,749



642,838



624,988


Total Assets

$     5,556,383



$     5,453,254



$     5,554,629



$     5,415,451


















Liabilities and Shareholders' Equity












Interest bearing demand deposits

$          753,966

0.21%


$          619,721

0.30%


$          736,144

0.21%


$          610,860

0.37%

Money market accounts 

768,527

0.25%


805,919

0.55%


775,192

0.31%


790,353

0.62%

Savings deposits

649,231

0.12%


579,901

0.23%


633,829

0.15%


563,789

0.28%

Certificates of deposit

1,511,330

1.70%


1,623,908

1.89%


1,543,703

1.73%


1,645,866

1.93%

    Total interest bearing deposits

3,683,054

0.81%


3,629,449

1.05%


3,688,868

0.86%


3,610,868

1.12%

Federal Home Loan Bank borrowings

119,464

3.40%


198,986

3.42%


142,734

3.45%


223,277

3.44%

Other borrowings

195,109

2.38%


200,025

2.42%


195,810

2.39%


191,552

2.51%

Junior subordinated debt

106,087

3.26%


106,054

3.03%


106,079

3.27%


106,046

3.05%

      Total interest bearing liabilities 

4,103,714

1.03%


4,134,514

1.28%


4,133,491

1.08%


4,131,743

1.36%

Non-interest bearing demand deposits

756,782



649,956



734,248



626,088


Other liabilities

40,221



37,610



39,241



37,141


Shareholders' equity

655,666



631,174



647,649



620,479


Total Liabilities and Shareholders' Equity

$     5,556,383



$     5,453,254



$     5,554,629



$     5,415,451


Taxable equivalent net interest spread


3.34%



3.50%



3.36%



3.50%

Taxable equivalent net interest margin 


3.51%



3.67%



3.53%



3.69%

















(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 $1.0 million and $1.0 million for the three months ended September 30, 2012 and 2011,

     and $3.1 million and $3.3 million for the nine months ended September 30, 2012 and 2011, 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.




















WESBANCO, INC.





Consolidated Selected Financial Highlights




 Page 9 

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








Quarter Ended

Statement of Income

Sept. 30,


June 30,


Mar. 31, 


Dec. 31,


Sept. 30,

Interest income

2012


2012


2012


2011


2011


Loans, including fees

$          41,423


$                40,957


$              41,964


$                42,767


$              44,191


Interest and dividends on securities:












Taxable 

7,722


8,471


8,590


8,862


9,032



Tax-exempt

3,113


3,079


3,079


3,059


3,019



    Total interest and dividends on securities

10,835


11,550


11,669


11,921


12,051


Other interest income 

30


38


47


52


45

          Total interest and dividend income

52,288


52,545


53,680


54,740


56,287

Interest expense











Interest bearing demand deposits

397


393


405


487


462


Money market deposits

487


493


742


1,108


1,121


Savings deposits

202


200


295


337


332


Certificates of deposit

6,450


6,621


6,979


7,347


7,728



    Total interest expense on deposits

7,536


7,707


8,421


9,279


9,643


Federal Home Loan Bank borrowings

1,020


1,288


1,377


1,456


1,714


Other short-term borrowings

1,169


1,156


1,178


1,232


1,220


Junior subordinated debt owed to unconsolidated subsidiary trusts

869


854


874


839


809



    Total interest expense

10,594


11,005


11,850


12,806


13,386

Net interest income 

41,694


41,540


41,830


41,934


42,901


Provision for credit losses

4,497


5,903


6,202


9,631


10,836

Net interest income after provision for credit losses

37,197


35,637


35,628


32,303


32,065

Non-interest income











Trust fees

4,379


4,258


4,753


4,198


3,941


Service charges on deposits

4,362


4,218


3,993


4,638


4,881


Electronic banking fees

2,846


2,920


2,763


2,603


2,679


Net securities brokerage revenue

1,131


1,114


1,075


1,048


1,182


Bank-owned life insurance

891


874


880


864


908


Net gains on sales of mortgage loans

993


599


268


679


327


Net securities gains

316


1,294


100


865


67


Net loss on other real estate owned and other assets

(48)


(282)


32


(312)


(162)


Other income

1,092


899


1,458


1,185


776



    Total non-interest income

15,962


15,894


15,322


15,768


14,599

Non-interest expense











Salaries and wages

14,758


13,955


14,315


14,633


14,427


Employee benefits

5,000


4,920


5,618


4,456


3,462


Net occupancy

2,654


2,703


2,776


2,805


3,068


Equipment 

2,300


2,144


2,174


2,193


2,107


Marketing

795


1,716


771


1,281


1,214


FDIC insurance 

951


965


1,045


1,008


1,091


Amortization of intangible assets

519


524


537


588


599


Restructuring and merger-related expense

1,518


-


-


-


-


Other operating expenses  

8,295


9,157


8,429


8,530


7,639



    Total non-interest expense

36,790


36,084


35,665


35,494


33,607

Income before provision for income taxes

16,369


15,447


15,285


12,577


13,057


Provision for income taxes 

3,463


3,449


3,295


1,940


2,044

Net Income

$                      12,906


$                11,998


$              11,990


$                10,637


$              11,013














Taxable equivalent net interest income

$                     43,370


$             43,197


$           43,488


$             43,581


$           44,526














Per common share data










Net income per common share - basic

$                          0.48


$                    0.45


$                  0.45


$                    0.40


$                  0.41

Net income per common share - diluted

$                          0.48


$                    0.45


$                  0.45


$                    0.40


$                  0.41

Dividends declared

$                          0.18


$                    0.17


$                  0.17


$                    0.16


$                  0.16

Book value (period end)

$                        24.73


$                  24.34


$                24.11


$                  23.80


$                23.82

Tangible book value (period end) (1)

$                        14.17


$                  13.76


$                13.50


$                  13.17


$                13.17

Average common shares outstanding - basic

26,664,882


26,647,050


26,628,025


26,629,360


26,629,360

Average common shares outstanding - diluted

26,672,849


26,650,325


26,631,187


26,629,688


26,629,543

Period end common shares outstanding

26,665,519


26,664,644


26,627,689


26,629,360


26,629,360

Full time equivalent employees

1,366


1,404


1,371


1,368


1,377



























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














WESBANCO, INC.







Consolidated Selected Financial Highlights





 Page 10 

(unaudited, dollars in thousands)











Quarter Ended






Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Sept. 30,


Asset quality data

2012


2012


2012


2011


2011


Non-performing assets:












Troubled debt restructurings - accruing

$         24,858


$         28,165


$         27,900


$         29,411


$         27,416



Non-accrual loans:













Troubled debt restructurings

9,449


11,159


16,935


17,287


16,312




Other non-accrual loans

24,841


28,793


36,139


40,205


40,505




    Total non-accrual loans

34,290


39,952


53,074


57,492


56,817




    Total non-performing loans 

59,148


68,117


80,974


86,903


84,233



Other real estate and repossessed assets

3,951


3,918


3,178


3,029


4,687




Total non-performing assets

$         63,099


$         72,035


$         84,152


$         89,932


$         88,920















Past due loans (1):












Loans past due 30-89 days

$         17,332


$         15,117


$         15,034


$         19,888


$         23,658



Loans past due 90 days or more

3,560


3,639


3,146


5,135


6,401




Total past due loans

$         20,892


$         18,756


$         18,180


$         25,023


$         30,059















Criticized and classified loans (2):












Criticized loans

$       102,792


$       122,854


$       129,312


$       141,195


$       147,572



Classified loans

94,613


100,436


107,757


116,973


123,102




Total criticized and classified loans

$       197,405


$       223,290


$       237,069


$       258,168


$       270,674















Loans past due 30-89 days / total loans

0.52

%

0.46

%

0.47

%

0.61

%

0.73

%

Loans past due 90 days or more / total loans

0.11


0.11


0.10


0.16


0.20


Non-performing loans / total loans

1.76


2.08


2.51


2.68


2.60


Non-performing assets/total loans, other












real estate and repossessed assets

1.88


2.20


2.61


2.77


2.74


Criticized and classified loans / total loans

5.89


6.82


7.35


7.97


8.35
















Allowance for loan losses











Allowance for loan losses

$         53,476


$         53,610


$         54,395


$         54,810


$         55,098


Provision for credit losses

4,497


5,903


6,202


9,631


10,836


Net loan and deposit account overdraft charge-offs

4,566


6,805


6,617


9,921


17,392
















Annualized net loan charge-offs /average loans

0.54

%

0.84

%

0.82

%

1.22

%

2.11

%

Allowance for loan losses/total loans

1.59

%

1.64

%

1.69

%

1.69

%

1.70

%

Allowance for loan losses/non-performing loans

0.90

x

0.79

x

0.67

x

0.63

x

0.65

x

Allowance for loan losses/non-performing loans and












loans past due 

0.67

x

0.62

x

0.55

x

0.49

x

0.48

x

































Quarter Ended






Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Sept. 30,






2012


2012


2012


2011


2011


Capital ratios











Tier I leverage capital

9.11

%

8.94

%

8.81

%

8.71

%

8.69

%

Tier I risk-based capital

13.20


13.11


12.89


12.68


12.49


Total risk-based capital

14.45


14.36


14.14


13.93


13.74


Average shareholders' equity to average assets

11.80


11.66


11.52


11.58


11.57


Tangible equity to tangible assets (3)

7.13


7.00


6.76


6.68


6.72






























(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 11




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 





Sept. 30,


June 30,


Mar. 31,


Dec. 31, 


Sept. 30, 


Sept. 30,

(unaudited, dollars in thousands)

2012


2012


2012


2011