City Holding Company Announces First Quarter Results
CHARLESTON, W.Va., April 26, 2011 /PRNewswire/ -- City Holding Company, “the Company” (NASDAQ: CHCO), a $2.7 billion bank holding company headquartered in Charleston, today announced net income per diluted share for the first quarter of $0.62 compared to $0.58 per diluted share in the first quarter of 2010. Net income for the first quarter of 2011 was $9.6 million compared to $9.3 million in the first quarter of 2010. For the first quarter of 2011, the Company achieved a return on assets of 1.44%, a return on tangible equity of 14.7%, a net interest margin of 3.95%, and an efficiency ratio of 55.7%. This compares with a return on assets of 1.42%, a return on equity of 14.6%, a net interest margin of 4.14%, and an efficiency ratio of 54.9% for the comparable period of 2010.
City’s CEO Charles Hageboeck stated that, “City’s results for the first quarter of 2011 are up slightly from the first quarter of 2010 and remain favorable compared to our peers despite the continuing challenges of additional regulations, a prolonged abnormally low interest rate environment, and an economic environment that remains cloudy and uncertain. City’s asset quality remains strong with stable and relatively low levels of past due loans. While our nonperforming assets increased in the first quarter due to the deteriorating performance of a large commercial relationship, the impact on the allowance for loan losses was relatively muted, as this client’s deteriorating financial performance was previously anticipated by management and we believe that the loan is well secured with marketable real estate. Reflecting the Company’s success at anticipating credit challenges, net charge-offs for the quarter were only $0.9 million.”
“Net interest income for the first quarter of 2011, exclusive of the impact of our interest rate floors, increased $0.1 million from the first quarter of 2010. While the yield on interest earning assets has been compressed due to the sustained low interest rate environment, we have been able to offset this impact by growing our loan portfolio 3.8% from March 31, 2010 and continuing to prudently price our interest bearing deposits. Additionally, based upon current trends, we believe that loan growth in 2011 will exceed that achieved in the prior year. The net interest margin has been stable for the last three quarters, with the decrease as compared to a year-ago primarily attributable to income earned on interest rate floors which will expire in June 2011. ”
“As anticipated, our service fee revenues declined $1.2 million, or 11.5%, from the first quarter of 2010. This decline is attributable to changes brought about by the Electronic Funds Transfer Act and Federal Reserve Board Regulation E, less spending by consumers, and implementation of an enhanced customer service providing “real-time” processing of electronic transactions which had the additional benefit to customers of reducing certain bank fees. However, this decline in non-interest income was mitigated by the Company not experiencing any credit-related net impairment losses in the first quarter of 2011.”
“City’s financial position remains strong and healthy. Our balance sheet is positioned to benefit from future interest rate increases; we have stable core deposits; and we have strong capital and liquidity. City continues to hold its place as one of the most profitable and well capitalized publicly traded banks in the U.S. and we look forward to continuing to meet the needs of our shareholders and customers,” Hageboeck concluded.
Net Interest Income
The Company’s tax equivalent net interest income decreased $0.7 million, or 2.9%, from $23.8 million during the first quarter of 2010 to $23.1 million during the first quarter of 2011. This decline is due to a decrease in interest income associated with the gain from the sale of interest rate floors. During the third and fourth quarters of 2008, the Company sold $450 million of interest rate floors. The $16.7 million gain from sales of these interest rate floors is being recognized over the remaining lives of the various hedged loans – primarily prime-based commercial and home equity loans. During the first quarter of 2011, the Company recognized $0.7 million of interest income compared to $1.5 million of interest income recognized in the first quarter of 2010 from the interest rate floors. The Company’s reported net interest margin decreased from 4.14% for the quarter ended March 31, 2010 to 3.95% for the quarter ended March 31, 2011, primarily reflecting the impact associated with the lower interest income recognized on the interest rate floors described above.
Credit Quality
The Company’s ratio of non-performing assets to total loans and other real estate owned increased from 1.12% at December 31, 2010 to 1.75% at March 31, 2011, due to a large commercial relationship whose performance has deteriorated. Despite this increase, the Company’s ratio of non-performing assets to total loans and other real estate owned continues to compare very favorably to peers. The Company’s non-performing asset ratio of 1.75% at March 31, 2011 is only 30% of the 5.83% non-performing asset ratio reported by the Company’s peer group (bank holding companies with total assets between $1 and $5 billion) as of the most recently reported quarter ended December 31, 2010.
Past due loans decreased modestly from $8.7 million at December 31, 2010 to $8.3 million or 0.44% of total loans outstanding at March 31, 2011. Past due residential real estate loans were $3.3 million or 0.53% of residential real estate loans outstanding at March 31, 2011; past due home equity loans were $2.3 million or 0.54% of home equity loans outstanding at March 31, 2011; past due commercial real estate loans were $1.7 million or 0.26% of commercial real estate loans outstanding at March 31, 2011; and past due commercial and industrial loans were $0.4 million or 0.31% of commercial and industrial loans outstanding at March 31, 2011.
The Company had net charge-offs of $0.9 million for the first quarter of 2011, which primarily consists of net charge-offs on residential real estate loans of $0.6 million and home equity loans of $0.2 million.
At March 31, 2011, the Allowance for Loan Losses (“ALLL”) was $18.4 million or 0.98% of total loans outstanding and 72% of non-performing loans compared to $18.8 million or 1.05% of loans outstanding and 132% of non-performing loans at March 31, 2010, and $18.2 million or 0.98% of loans outstanding and 156% of non-performing loans at December 31, 2010.
As a result of the Company’s quarterly analysis of the adequacy of the ALLL, the Company recorded a provision for loan losses of $1.1 million in the first quarter of 2011, which is similar to the $1.1 million for the comparable period in 2010. Changes in the amount of the provision and related allowance are based on the Company’s detailed systematic methodology and are directionally consistent with changes in the composition and quality of the Company’s loan portfolio. The Company believes its methodology for determining the adequacy of its ALLL adequately provides for probable losses inherent in the loan portfolio and produces a provision and allowance for loan losses that is directionally consistent with changes in asset quality and loss experience.
Non-interest Income
Exclusive of net other-than-temporary investment impairment losses during the quarter ended March 31, 2010, non-interest income decreased $1.1 million to $12.7 million in the first quarter of 2011 as compared to $13.8 million in the first quarter of 2010. Service charges from depository accounts decreased $1.2 million, or 11.5%, to $9.1 million in the first quarter of 2011 due to the changes from complying with Regulation E, a general decline in consumer spending, and implementation of “real time” processing of all electronic transactions in the second quarter of 2010. This decrease was partially offset by an increase in insurance commission revenues of $0.2 million, or 16.0%, from $1.4 million during the first quarter of 2010 to $1.6 million during the first quarter of 2011.
Non-interest Expenses
Non-interest expenses decreased $0.7 million, from $20.6 million in the first quarter of 2010 to $19.9 million in the first quarter of 2011. Most of this decline can be attributed to repossessed asset losses, which decreased $0.7 million, primarily due to the write down of a foreclosed property located in the eastern panhandle of West Virginia in the first quarter of 2010. Additionally, advertising expenses declined $0.2 million, or 25.5%, from the first quarter of 2010. These decreases were partially offset by increased salaries and employee benefit expenses of $0.2 million.
Balance Sheet Trends
As compared to December 31, 2010, loans have increased modestly at March 31, 2011 to $1.87 billion, primarily due to increases in commercial real estate loans of $7.0 million (1.1%) and residential real estate loans of $5.3 million (0.9%), which were partially offset by decreases in commercial and industrial loans of $5.1 million (3.8%) and consumer loans of $0.9 million (2.5%).
Total average depository balances increased $31.0 million, or 1.4%, from the quarter ended December 31, 2010 to the quarter ended March 31, 2011. This growth was primarily in interest-bearing deposits ($18.2 million), noninterest-bearing deposits ($9.7 million), and savings deposits ($9.7 million). These increases were partially offset by a decrease of $6.6 million in time deposits.
Income Tax Expense
The Company’s effective income tax rate for the first quarter of 2011 was 33.8% compared to 32.1% for the year ended December 31, 2010, and 33.3% for the quarter ended March 31, 2010. The effective rate is based upon the Company’s expected tax rate for the year ending December 31, 2011.
Capitalization and Liquidity
One of the Company’s strengths is that it is highly profitable while maintaining strong liquidity and capital. With respect to liquidity, the Company’s loan to deposit ratio was 83.9% and the loan to asset ratio was 69.2% at March 31, 2011. The Company maintained investment securities totaling 17.9% of assets as of this date. Further, the Company’s deposit mix is weighted heavily toward checking and saving accounts that fund 47.1% of assets at March 31, 2011. Time deposits fund 35.5% of assets at March 31, 2011, but very few of these deposits are in accounts that have balances of more than $150,000, reflecting the core retail orientation of the Company.
The Company is also strongly capitalized. The Company’s tangible equity ratio was 9.6% at March 31, 2011 compared to 10.0% at December 31, 2010. At March 31, 2011, City National Bank’s Leverage Ratio is 9.26%, its Tier I Capital ratio is 12.25%, and its Total Risk-Based Capital ratio is 13.20%. These regulatory capital ratios are significantly above levels required to be considered “well capitalized,” which is the highest possible regulatory designation. Further, the Company’s strong bank capital has not been achieved through the excessive issuance of trust preferred debt by the bank holding company or by participation in the Troubled Asset Relief Program (“TARP”).
On March 30, 2011, the Board approved a quarterly cash dividend to 34 cents per share payable April 29, 2011, to shareholders of record as of April 15, 2011. During the quarter ended March 31, 2011, the Company repurchased 270,745 common shares at a weighted average price of $34.62 as part of a one million share repurchase plan authorized by the Board of Directors in October 2009. At March 31, 2011, the Company could repurchase approximately 294,000 shares under the October 2009 authorization.
City Holding Company is the parent company of City National Bank of West Virginia. City National operates 68 branches across West Virginia, Eastern Kentucky and Southern Ohio.
Forward-Looking Information
This news release contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such information involves risks and uncertainties that could result in the Company's actual results differing from those projected in the forward-looking statements. Important factors that could cause actual results to differ materially from those discussed in such forward-looking statements include, but are not limited to, (1) the Company may incur additional loan loss provision due to negative credit quality trends in the future that may lead to a deterioration of asset quality; (2) the Company may incur increased charge-offs in the future; (3) the Company may experience increases in the default rates on previously securitized loans that would result in impairment losses or lower the yield on such loans; (4) the Company may not continue to benefit from strong recovery efforts on previously securitized loans resulting in improved yields on these assets; (5) the Company could have adverse legal actions of a material nature; (6) the Company may face competitive loss of customers; (7) the Company may be unable to manage its expense levels; (8) the Company may have difficulty retaining key employees; (9) changes in the interest rate environment may have results on the Company’s operations materially different from those anticipated by the Company’s market risk management functions; (10) changes in general economic conditions and increased competition could adversely affect the Company’s operating results; (11) changes in other regulations and government policies affecting bank holding companies and their subsidiaries, including changes in monetary policies, could negatively impact the Company’s operating results; (12) the Company may experience difficulties growing loan and deposit balances; (13) the current economic environment poses significant challenges for us and could adversely affect our financial condition and results of operations; (14) continued deterioration in the financial condition of the U.S. banking system may impact the valuations of investments the Company has made in the securities of other financial institutions resulting in either actual losses or other than temporary impairments on such investments; and (15) the effects of the Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) recently adopted by the United States Congress. Forward-looking statements made herein reflect management’s expectations as of the date such statements are made. Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist stockholders and potential investors in understanding current and anticipated financial operations of the Company and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made.
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||
Three Months Ended March 31, |
Percent |
|||
2011 |
2010 |
Change |
||
Earnings ($000s, except per share data): |
||||
Net Interest Income (FTE) |
$ 23,062 |
$ 23,746 |
(2.88)% |
|
Net Income available to common shareholders |
9,614 |
9,313 |
3.23% |
|
Earnings per Basic Share |
0.62 |
0.59 |
5.83% |
|
Earnings per Diluted Share |
0.62 |
0.58 |
5.65% |
|
Key Ratios (percent): |
||||
Return on Average Assets |
1.44% |
1.42% |
1.61% |
|
Return on Average Tangible Equity |
14.68% |
14.57% |
0.71% |
|
Net Interest Margin |
3.95% |
4.14% |
(4.64)% |
|
Efficiency Ratio |
55.69% |
54.87% |
1.49% |
|
Average Shareholders' Equity to Average Assets |
11.91% |
11.87% |
0.31% |
|
Consolidated Risk Based Capital Ratios (a): |
||||
Tier I |
13.54% |
13.67% |
(0.95)% |
|
Total |
14.47% |
14.65% |
(1.23)% |
|
Tangible Equity to Tangible Assets |
9.63% |
9.79% |
(1.64)% |
|
Common Stock Data: |
||||
Cash Dividends Declared per Share |
$ 0.34 |
$ 0.34 |
- |
|
Book Value per Share |
20.39 |
19.71 |
3.43% |
|
Tangible Book Value per Share |
16.69 |
16.11 |
3.56% |
|
Market Value per Share: |
||||
High |
37.22 |
34.92 |
6.59% |
|
Low |
33.79 |
30.37 |
11.26% |
|
End of Period |
35.36 |
34.29 |
3.12% |
|
Price/Earnings Ratio (b) |
14.24 |
14.62 |
(2.56)% |
|
(a) March 31, 2011 risk-based capital ratios are estimated (b) March 31, 2011 price/earnings ratio computed based on annualized first quarter 2011 earnings |
||||
CITY HOLDING COMPANY AND SUBSIDIARIES |
|||||||
Book Value and Market Price Range per Share |
|||||||
Market Price |
|||||||
Book Value per Share |
Range per Share |
||||||
March 31 |
June 30 |
September 30 |
December 31 |
Low |
High |
||
2007 |
$ 17.62 |
$ 17.40 |
$ 17.68 |
$ 18.14 |
$ 31.16 |
$ 41.54 |
|
2008 |
18.92 |
18.72 |
17.61 |
17.58 |
29.08 |
42.88 |
|
2009 |
17.69 |
18.24 |
18.95 |
19.37 |
20.88 |
34.34 |
|
2010 |
19.71 |
19.95 |
20.31 |
20.31 |
26.87 |
38.03 |
|
2011 |
20.39 |
33.79 |
37.22 |
||||
Earnings per Basic Share |
|||||||
Quarter Ended |
|||||||
March 31 |
June 30 |
September 30 |
December 31 |
Year-to-Date |
|||
2007 |
$ 0.76 |
$ 0.72 |
$ 0.76 |
$ 0.78 |
$ 3.02 |
||
2008 |
0.81 |
0.83 |
(0.16) |
0.26 |
1.74 |
||
2009 |
0.69 |
0.64 |
0.66 |
0.70 |
2.69 |
||
2010 |
0.59 |
0.68 |
0.58 |
0.64 |
2.48 |
||
2011 |
0.62 |
0.62 |
|||||
Earnings per Diluted Share |
|||||||
Quarter Ended |
|||||||
March 31 |
June 30 |
September 30 |
December 31 |
Year-to-Date |
|||
2007 |
$ 0.76 |
$ 0.72 |
$ 0.76 |
$ 0.78 |
$ 3.01 |
||
2008 |
0.80 |
0.83 |
(0.16) |
0.26 |
1.74 |
||
2009 |
0.69 |
0.64 |
0.66 |
0.70 |
2.68 |
||
2010 |
0.58 |
0.68 |
0.58 |
0.64 |
2.47 |
||
2011 |
0.62 |
0.62 |
|||||
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||
Three Months Ended March 31, |
||||
2011 |
2010 |
|||
Interest Income |
||||
Interest and fees on loans |
$ 23,738 |
$ 24,854 |
||
Interest on investment securities: |
||||
Taxable |
4,541 |
5,611 |
||
Tax-exempt |
462 |
470 |
||
Interest on federal funds sold |
13 |
- |
||
Total Interest Income |
28,754 |
30,935 |
||
Interest Expense |
||||
Interest on deposits |
5,711 |
7,184 |
||
Interest on short-term borrowings |
72 |
100 |
||
Interest on long-term debt |
157 |
160 |
||
Total Interest Expense |
5,940 |
7,444 |
||
Net Interest Income |
22,814 |
23,491 |
||
Provision for loan losses |
1,086 |
1,080 |
||
Net Interest Income After Provision for Loan Losses |
21,728 |
22,411 |
||
Non-Interest Income |
||||
Total investment securities impairment losses |
- |
(3,203) |
||
Noncredit impairment losses recognized in other comprehensive income |
- |
1,552 |
||
Net investment securities impairment losses |
- |
(1,651) |
||
Service charges |
9,054 |
10,228 |
||
Insurance commissions |
1,621 |
1,397 |
||
Trust and investment management fee income |
753 |
862 |
||
Bank owned life insurance |
758 |
728 |
||
Other income |
476 |
548 |
||
Total Non-Interest Income |
12,662 |
12,112 |
||
Non-Interest Expense |
||||
Salaries and employee benefits |
9,912 |
9,749 |
||
Occupancy and equipment |
2,106 |
2,045 |
||
Depreciation |
1,136 |
1,218 |
||
Professional fees |
469 |
363 |
||
Postage, delivery, and statement mailings |
554 |
609 |
||
Advertising |
680 |
913 |
||
Telecommunications |
429 |
451 |
||
Bankcard expenses |
501 |
476 |
||
Insurance and regulatory |
1,232 |
1,187 |
||
Office supplies |
539 |
493 |
||
Repossessed asset losses, net of expenses |
198 |
946 |
||
Other expenses |
2,102 |
2,101 |
||
Total Non-Interest Expense |
19,858 |
20,551 |
||
Income Before Income Taxes |
14,532 |
13,972 |
||
Income tax expense |
4,918 |
4,659 |
||
Net Income Available to Common Shareholders |
$ 9,614 |
$ 9,313 |
||
Distributed earnings allocated to common shareholders |
$ 5,154 |
$ 5,345 |
||
Undistributed earnings allocated to common shareholders |
4,392 |
3,918 |
||
Net earnings allocated to common shareholders |
$ 9,546 |
$ 9,263 |
||
Average common shares outstanding |
15,380 |
15,793 |
||
Effect of dilutive securities: |
||||
Employee stock options |
82 |
58 |
||
Shares for diluted earnings per share |
15,462 |
15,851 |
||
Basic earnings per common share |
$ 0.62 |
$ 0.59 |
||
Diluted earnings per common share |
$ 0.62 |
$ 0.58 |
||
CITY HOLDING COMPANY AND SUBSIDIARIES |
|||
Three Months Ended |
|||
March 31, 2011 |
March 31, 2010 |
||
Balance at January 1 |
$ 314,861 |
$ 307,735 |
|
Net income |
9,614 |
9,313 |
|
Other comprehensive income: |
|||
Change in unrealized gain/(loss) on securities available-for-sale |
789 |
3,136 |
|
Change in unrealized (loss) on interest rate floors |
(196) |
(912) |
|
Cash dividends declared ($0.34/share) |
(5,190) |
(5,373) |
|
Issuance of stock award shares, net |
464 |
371 |
|
Exercise of 5,476 stock options |
153 |
- |
|
Exercise of 200 stock options |
- |
3 |
|
Purchase of 270,745 common shares of treasury |
(9,373) |
- |
|
Purchase of 84,015 common shares of treasury |
- |
(2,605) |
|
Balance at March 31 |
$ 311,122 |
$ 311,668 |
|
CITY HOLDING COMPANY AND SUBSIDIARIES |
|||||||
Quarter Ended |
|||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
|||
2011 |
2010 |
2010 |
2010 |
2010 |
|||
Interest income |
$ 28,754 |
$ 29,241 |
$ 29,970 |
$ 31,770 |
$ 30,935 |
||
Taxable equivalent adjustment |
248 |
244 |
244 |
246 |
255 |
||
Interest income (FTE) |
29,002 |
29,485 |
30,214 |
32,016 |
31,190 |
||
Interest expense |
5,940 |
6,283 |
6,810 |
7,092 |
7,444 |
||
Net interest income |
23,062 |
23,202 |
23,404 |
24,924 |
23,746 |
||
Provision for loan losses |
1,086 |
2,343 |
1,847 |
1,823 |
1,080 |
||
Net interest income after provision |
|||||||
for loan losses |
21,976 |
20,859 |
21,557 |
23,101 |
22,666 |
||
Noninterest income |
12,662 |
11,905 |
11,643 |
13,278 |
12,112 |
||
Noninterest expense |
19,858 |
18,400 |
19,804 |
19,965 |
20,551 |
||
Income before income taxes |
14,780 |
14,364 |
13,396 |
16,414 |
14,227 |
||
Income tax expense |
4,918 |
4,212 |
4,129 |
5,453 |
4,659 |
||
Taxable equivalent adjustment |
248 |
244 |
244 |
246 |
255 |
||
Net income available to common shareholders |
$ 9,614 |
$ 9,908 |
$ 9,023 |
$ 10,715 |
$ 9,313 |
||
Distributed earnings allocated to common shareholders |
$ 5,154 |
$ 5,239 |
$ 5,237 |
$ 5,274 |
$ 5,345 |
||
Undistributed earnings allocated to common shareholders |
4,392 |
4,610 |
3,733 |
5,374 |
3,918 |
||
Net earnings allocated to common shareholders |
$ 9,546 |
$ 9,849 |
$ 8,970 |
$ 10,648 |
$ 9,263 |
||
Average common shares outstanding |
15,380 |
15,439 |
15,496 |
15,656 |
15,793 |
||
Effect of dilutive securities: |
|||||||
Employee stock options |
82 |
69 |
56 |
65 |
58 |
||
Shares for diluted earnings per share |
15,462 |
15,508 |
15,552 |
15,721 |
15,851 |
||
Basic earnings per common share |
$ 0.62 |
$ 0.64 |
$ 0.58 |
$ 0.68 |
$ 0.59 |
||
Diluted earnings per common share |
0.62 |
0.64 |
0.58 |
0.68 |
0.58 |
||
Cash dividends declared per share |
0.34 |
0.34 |
0.34 |
0.34 |
0.34 |
||
Net Interest Margin |
3.95% |
3.92% |
3.94% |
4.22% |
4.14% |
||
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||
Quarter Ended |
||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
2011 |
2010 |
2010 |
2010 |
2010 |
||
Non-Interest Income: |
||||||
Service charges |
$ 9,054 |
$ 9,624 |
$ 9,702 |
$ 10,448 |
$ 10,228 |
|
Insurance commissions |
1,621 |
1,503 |
1,346 |
1,244 |
1,397 |
|
Trust and investment management fee income |
753 |
720 |
618 |
567 |
862 |
|
Bank owned life insurance |
758 |
751 |
1,104 |
813 |
728 |
|
Other income |
476 |
527 |
439 |
437 |
548 |
|
Subtotal |
12,662 |
13,125 |
13,209 |
13,509 |
13,763 |
|
Total investment securities impairment losses |
- |
(1,932) |
(3,028) |
(1,237) |
(3,203) |
|
Noncredit impairment losses recognized in other |
||||||
comprehensive income |
- |
713 |
127 |
944 |
1,552 |
|
Net investment securities impairment losses |
- |
(1,219) |
(2,901) |
(293) |
(1,651) |
|
Gain (loss) on sale of investment securities |
- |
(1) |
1,335 |
62 |
- |
|
Total Non-Interest Income |
$ 12,662 |
$ 11,905 |
$ 11,643 |
$ 13,278 |
$ 12,112 |
|
Non-Interest Expense: |
||||||
Salaries and employee benefits |
$ 9,912 |
$ 8,930 |
$ 9,817 |
$ 9,745 |
$ 9,749 |
|
Occupancy and equipment |
2,106 |
1,861 |
1,917 |
1,874 |
2,045 |
|
Depreciation |
1,136 |
1,138 |
1,145 |
1,174 |
1,218 |
|
Professional fees |
469 |
502 |
414 |
398 |
363 |
|
Postage, delivery, and statement mailings |
554 |
548 |
599 |
615 |
609 |
|
Advertising |
680 |
647 |
891 |
1,241 |
913 |
|
Telecommunications |
429 |
428 |
413 |
440 |
451 |
|
Bankcard expenses |
501 |
548 |
481 |
448 |
476 |
|
Insurance and regulatory |
1,232 |
1,238 |
1,244 |
1,200 |
1,187 |
|
Office supplies |
539 |
457 |
497 |
484 |
493 |
|
Repossessed asset losses, net of expenses |
198 |
196 |
234 |
78 |
946 |
|
Other expenses |
2,102 |
1,907 |
2,152 |
2,268 |
2,101 |
|
Total Non-Interest Expense |
$ 19,858 |
$ 18,400 |
$ 19,804 |
$ 19,965 |
$ 20,551 |
|
Employees (Full Time Equivalent) |
796 |
805 |
801 |
812 |
815 |
|
Branch Locations |
68 |
68 |
68 |
67 |
67 |
|
CITY HOLDING COMPANY AND SUBSIDIARIES |
|||
March 31 |
December 31 |
||
2011 |
2010 |
||
(Unaudited) |
|||
Assets |
|||
Cash and due from banks |
$ 51,953 |
$ 50,043 |
|
Interest-bearing deposits in depository institutions |
9,188 |
5,336 |
|
Federal funds sold |
35,000 |
11,000 |
|
Cash and cash equivalents |
96,141 |
66,379 |
|
Investment securities available-for-sale, at fair value |
460,600 |
429,720 |
|
Investment securities held-to-maturity, at amortized cost |
23,875 |
23,865 |
|
Total investment securities |
484,475 |
453,585 |
|
Gross loans |
1,869,524 |
1,865,000 |
|
Allowance for loan losses |
(18,414) |
(18,224) |
|
Net loans |
1,851,110 |
1,846,776 |
|
Bank owned life insurance |
76,961 |
76,231 |
|
Premises and equipment, net |
63,867 |
64,530 |
|
Accrued interest receivable |
8,149 |
7,264 |
|
Net deferred tax assets |
29,444 |
29,235 |
|
Intangible assets |
56,471 |
56,573 |
|
Other assets |
33,306 |
36,722 |
|
Total Assets |
$ 2,699,924 |
$ 2,637,295 |
|
Liabilities |
|||
Deposits: |
|||
Noninterest-bearing |
$ 344,562 |
$ 337,927 |
|
Interest-bearing: |
|||
Demand deposits |
506,971 |
486,737 |
|
Savings deposits |
419,445 |
397,042 |
|
Time deposits |
957,552 |
949,669 |
|
Total deposits |
2,228,530 |
2,171,375 |
|
Short-term borrowings |
119,302 |
112,710 |
|
Long-term debt |
16,495 |
16,495 |
|
Other liabilities |
24,475 |
21,854 |
|
Total Liabilities |
2,388,802 |
2,322,434 |
|
Stockholders' Equity |
|||
Preferred stock, par value $25 per share: 500,000 shares authorized; none issued |
- |
- |
|
Common stock, par value $2.50 per share: 50,000,000 shares authorized; |
|||
18,499,282 shares issued at March 31, 2011 and December 31, 2010 |
|||
less 3,237,337 and 2,994,501 shares in treasury, respectively |
46,249 |
46,249 |
|
Capital surplus |
102,737 |
103,057 |
|
Retained earnings |
275,329 |
270,905 |
|
Cost of common stock in treasury |
(111,289) |
(102,853) |
|
Accumulated other comprehensive loss: |
|||
Unrealized gain on securities available-for-sale |
1,811 |
1,022 |
|
Unrealized gain on derivative instruments |
99 |
295 |
|
Underfunded pension liability |
(3,814) |
(3,814) |
|
Total Accumulated Other Comprehensive Loss |
(1,904) |
(2,497) |
|
Total Stockholders' Equity |
311,122 |
314,861 |
|
Total Liabilities and Stockholders' Equity |
$ 2,699,924 |
$ 2,637,295 |
|
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||||
Original Cost |
Credit-Related Net Investment Impairment Losses through March 31, 2011 |
Unrealized Gains (Losses) |
Carrying Value |
|||||
Mortgage Backed Securities |
$ 268,959 |
$ - |
$ 7,182 |
$ 276,141 |
||||
Municipal Bonds |
64,625 |
- |
644 |
65,269 |
||||
Pooled Bank Trust Preferreds |
27,090 |
(19,241) |
(4,806) |
3,043 |
||||
Single Issuer Bank Trust Preferreds, |
||||||||
Subdebt of Financial Institutions, and |
||||||||
Bank Holding Company Preferred Stocks |
93,201 |
(1,653) |
743 |
92,291 |
||||
Money Markets and Mutual Funds |
31,118 |
- |
(13) |
31,105 |
||||
Federal Reserve Bank and FHLB stock |
12,262 |
- |
- |
12,262 |
||||
Community Bank Equity Positions |
10,337 |
(5,130) |
(843) |
4,364 |
||||
Total Investments |
$ 507,592 |
$ (26,024) |
$ 2,907 |
$ 484,475 |
||||
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
2011 |
2010 |
2010 |
2010 |
2010 |
||
Residential real estate (1) |
$ 615,635 |
$ 610,369 |
$ 605,351 |
$ 605,026 |
$ 597,429 |
|
Home equity |
415,719 |
416,172 |
411,481 |
404,789 |
398,443 |
|
Commercial and industrial |
129,475 |
134,612 |
135,407 |
139,454 |
141,687 |
|
Commercial real estate (2) |
668,710 |
661,758 |
629,924 |
638,660 |
619,536 |
|
Consumer |
37,482 |
38,424 |
39,879 |
40,447 |
41,144 |
|
DDA overdrafts |
1,970 |
2,876 |
2,528 |
3,412 |
2,453 |
|
Previously securitized loans |
533 |
789 |
1,268 |
1,784 |
1,148 |
|
Gross Loans |
$ 1,869,524 |
$ 1,865,000 |
$ 1,825,838 |
$ 1,833,572 |
$ 1,801,840 |
|
(1) - Included in residential real estate loans are $9.4 million of construction loans at March 31, 2011. (2) - Included in commercial real estate loans are $24.3 million of construction loans at March 31, 2011. |
||||||
CITY HOLDING COMPANY AND SUBSIDIARIES |
|||||||
Three Months Ended March 31, |
|||||||
2011 |
2010 |
||||||
Average |
Yield/ |
Average |
Yield/ |
||||
Balance |
Interest |
Rate |
Balance |
Interest |
Rate |
||
Assets: |
|||||||
Loan portfolio (1): |
|||||||
Residential real estate |
$ 608,653 |
$ 7,470 |
4.98% |
$ 592,935 |
$ 7,895 |
5.40% |
|
Home equity (2) |
414,664 |
5,074 |
4.96% |
397,690 |
5,358 |
5.46% |
|
Commercial, financial, and agriculture (3) |
792,536 |
9,477 |
4.85% |
753,548 |
9,910 |
5.33% |
|
Installment loans to individuals (4) |
45,249 |
812 |
7.28% |
47,520 |
913 |
7.79% |
|
Previously securitized loans |
658 |
905 |
557.79% |
1,441 |
779 |
219.24% |
|
Total loans |
1,861,760 |
23,738 |
5.17% |
1,793,134 |
24,855 |
5.62% |
|
Securities: |
|||||||
Taxable |
420,082 |
4,541 |
4.38% |
477,632 |
5,611 |
4.76% |
|
Tax-exempt (5) |
50,725 |
710 |
5.68% |
49,635 |
724 |
5.92% |
|
Total securities |
470,807 |
5,251 |
4.52% |
527,267 |
6,335 |
4.87% |
|
Deposits in depository institutions |
8,661 |
- |
- |
4,773 |
- |
- |
|
Federal funds sold |
26,780 |
13 |
0.20% |
- |
- |
- |
|
Total interest-earning assets |
2,368,008 |
29,002 |
4.97% |
2,325,174 |
31,190 |
5.44% |
|
Cash and due from banks |
56,459 |
54,639 |
|||||
Bank premises and equipment |
64,342 |
64,116 |
|||||
Other assets |
204,494 |
207,817 |
|||||
Less: Allowance for loan losses |
(18,555) |
(19,108) |
|||||
Total assets |
$ 2,674,748 |
$ 2,632,638 |
|||||
Liabilities: |
|||||||
Interest-bearing demand deposits |
485,204 |
244 |
0.20% |
456,969 |
350 |
0.31% |
|
Savings deposits |
402,099 |
257 |
0.26% |
381,900 |
282 |
0.30% |
|
Time deposits |
952,632 |
5,210 |
2.22% |
999,661 |
6,552 |
2.66% |
|
Short-term borrowings |
111,192 |
72 |
0.26% |
110,163 |
100 |
0.37% |
|
Long-term debt |
16,495 |
157 |
3.86% |
16,944 |
160 |
3.83% |
|
Total interest-bearing liabilities |
1,967,622 |
5,940 |
1.22% |
1,965,637 |
7,444 |
1.54% |
|
Noninterest-bearing demand deposits |
369,356 |
341,132 |
|||||
Other liabilities |
19,275 |
13,343 |
|||||
Stockholders' equity |
318,495 |
312,526 |
|||||
Total liabilities and |
|||||||
stockholders' equity |
$ 2,674,748 |
$ 2,632,638 |
|||||
Net interest income |
$ 23,062 |
$ 23,746 |
|||||
Net yield on earning assets |
3.95% |
4.14% |
|||||
(1) For purposes of this table, non-accruing loans have been included in average balances and loan fees, which are immaterial, have been included in interest income. (2) Interest income includes $478 and $721 from interest rate floors for the three months ended March 31, 2011 and March 31, 2010, respectively. (3) Includes the Company’s commercial and industrial and commercial real estate loan categories. Interest income includes $246 and $760 from interest rate floors for the three months ended March 31, 2011 and March 31, 2010, respectively. (4) Includes the Company’s consumer and DDA overdrafts loan categories. (5) Computed on a fully federal tax-equivalent basis assuming a tax rate of approximately 35%. |
|||||||
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
2011 (a) |
2010 |
2010 |
2010 |
2010 |
||
Tier I Capital: |
||||||
Stockholders' equity |
$ 311,122 |
$ 314,861 |
$ 314,841 |
$ 311,408 |
$ 311,668 |
|
Goodwill and other intangibles |
(56,276) |
(56,378) |
(56,487) |
(56,596) |
(56,705) |
|
Accumulated other comprehensive loss (income) |
1,904 |
2,497 |
(2,498) |
(950) |
330 |
|
Qualifying trust preferred stock |
16,000 |
16,000 |
16,000 |
16,000 |
16,000 |
|
Unrealized loss on AFS securities |
(856) |
(521) |
(1,277) |
(3,668) |
(2,950) |
|
Excess deferred tax assets |
(4,174) |
(2,904) |
(2,915) |
(3,530) |
(3,827) |
|
Total tier I capital |
$ 267,720 |
$ 273,555 |
$ 267,664 |
$ 262,664 |
$ 264,516 |
|
Total Risk-Based Capital: |
||||||
Tier I capital |
$ 267,720 |
$ 273,555 |
$ 267,664 |
$ 262,664 |
$ 264,516 |
|
Qualifying allowance for loan losses |
18,414 |
18,224 |
18,364 |
19,456 |
18,982 |
|
Total risk-based capital |
$ 286,134 |
$ 291,779 |
$ 286,028 |
$ 282,120 |
$ 283,498 |
|
Net risk-weighted assets |
$ 1,977,395 |
$ 1,970,635 |
$ 1,949,080 |
$ 1,952,076 |
$ 1,935,071 |
|
Ratios: |
||||||
Average stockholders' equity to average assets |
11.91% |
12.09% |
11.90% |
11.76% |
11.87% |
|
Tangible capital ratio |
9.63% |
10.01% |
10.04% |
9.86% |
9.79% |
|
Risk-based capital ratios: |
||||||
Tier I capital |
13.54% |
13.88% |
13.73% |
13.46% |
13.67% |
|
Total risk-based capital |
14.47% |
14.81% |
14.68% |
14.45% |
14.65% |
|
Leverage capital |
10.24% |
10.54% |
10.30% |
10.06% |
10.28% |
|
(a) March 31, 2011 risk-based capital ratios are estimated |
||||||
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||
As of and for the Quarter Ended |
||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
2011 |
2010 |
2010 |
2010 |
2010 |
||
Intangibles, net |
$ 56,471 |
$ 56,573 |
$ 56,682 |
$ 56,791 |
$ 56,900 |
|
Intangibles amortization expense |
102 |
109 |
109 |
109 |
110 |
|
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||
Quarter Ended |
||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
2011 |
2010 |
2010 |
2010 |
2010 |
||
Balance at beginning of period |
$ 18,224 |
$ 18,364 |
$ 19,456 |
$ 18,836 |
$ 18,541 |
|
Charge-offs: |
||||||
Commercial and industrial |
75 |
25 |
- |
- |
48 |
|
Commercial real estate |
34 |
149 |
2,046 |
796 |
313 |
|
Residential real estate |
550 |
511 |
457 |
399 |
240 |
|
Home equity |
237 |
312 |
197 |
238 |
183 |
|
Consumer |
44 |
38 |
43 |
20 |
26 |
|
DDA overdrafts |
434 |
1,867 |
615 |
565 |
550 |
|
Total charge-offs |
1,374 |
2,902 |
3,358 |
2,018 |
1,360 |
|
Recoveries: |
||||||
Commercial and industrial |
3 |
5 |
12 |
2 |
8 |
|
Commercial real estate |
2 |
24 |
16 |
376 |
1 |
|
Residential real estate |
6 |
12 |
12 |
37 |
14 |
|
Home equity |
1 |
15 |
- |
1 |
9 |
|
Consumer |
38 |
37 |
29 |
53 |
50 |
|
DDA overdrafts |
428 |
326 |
350 |
346 |
493 |
|
Total recoveries |
478 |
419 |
419 |
815 |
575 |
|
Net charge-offs |
896 |
2,483 |
2,939 |
1,203 |
785 |
|
Provision for loan losses |
1,086 |
2,343 |
1,847 |
1,823 |
1,080 |
|
Balance at end of period |
$ 18,414 |
$ 18,224 |
$ 18,364 |
$ 19,456 |
$ 18,836 |
|
Loans outstanding |
$ 1,869,524 |
$ 1,865,000 |
$ 1,825,838 |
$ 1,833,572 |
$ 1,801,840 |
|
Average loans outstanding |
1,861,760 |
1,837,687 |
1,829,119 |
1,821,822 |
1,793,134 |
|
Allowance as a percent of loans outstanding |
0.98% |
0.98% |
1.01% |
1.06% |
1.05% |
|
Allowance as a percent of non-performing loans |
72.14% |
156.39% |
160.40% |
177.78% |
131.60% |
|
Net charge-offs (annualized) as a |
||||||
percent of average loans outstanding |
0.19% |
0.54% |
0.64% |
0.26% |
0.18% |
|
Net charge-offs, excluding overdraft deposit |
||||||
accounts, (annualized) as a percent of average loans outstanding |
0.19% |
0.21% |
0.58% |
0.22% |
0.16% |
|
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
2011 |
2010 |
2010 |
2010 |
2010 |
||
Nonaccrual loans |
$ 25,166 |
$ 10,817 |
$ 11,220 |
$ 10,246 |
$ 14,008 |
|
Accruing loans past due 90 days or more |
358 |
782 |
195 |
698 |
305 |
|
Previously securitized loans past due 90 days or more |
- |
54 |
34 |
- |
- |
|
Total non-performing loans |
25,524 |
11,653 |
11,449 |
10,944 |
14,313 |
|
Other real estate owned |
7,241 |
9,316 |
12,636 |
12,722 |
10,800 |
|
Total non-performing assets |
$ 32,765 |
$ 20,969 |
$ 24,085 |
$ 23,666 |
$ 25,113 |
|
Non-performing assets as a percent of loans and |
||||||
other real estate owned |
1.75% |
1.12% |
1.31% |
1.28% |
1.39% |
|
CITY HOLDING COMPANY AND SUBSIDIARIES |
||||||
Summary of Total Past Due Loans |
||||||
(Unaudited) ($ in 000s) |
||||||
March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
2011 |
2010 |
2010 |
2010 |
2010 |
||
Residential real estate |
$ 3,293 |
$ 4,774 |
$ 3,815 |
$ 5,298 |
$ 3,850 |
|
Home equity |
2,260 |
2,276 |
2,863 |
1,763 |
1,818 |
|
Commercial and industrial |
397 |
- |
150 |
332 |
14 |
|
Commercial real estate |
1,740 |
775 |
112 |
3,348 |
484 |
|
Consumer |
75 |
147 |
106 |
168 |
133 |
|
Previously securitized loans |
262 |
345 |
518 |
394 |
539 |
|
DDA overdrafts |
231 |
361 |
337 |
399 |
326 |
|
Total past due loans |
$ 8,258 |
$ 8,678 |
$ 7,901 |
$ 11,702 |
$ 7,164 |
|
SOURCE City Holding Company
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