First Commonwealth Announces Second Quarter 2010 Improved Financial Results
INDIANA, Pa., July 29 /PRNewswire-FirstCall/ -- First Commonwealth Financial Corporation (NYSE: FCF) today reported net income of $13.5 million, or $0.15 diluted earnings per share, for the second quarter ended June 30, 2010 compared to a net loss of $18.6 million, or $0.22 per share, in the second quarter of 2009. For the six months ended June 30, 2010, net income was $0.4 million, compared to a net loss of $16.9 million or $0.20 per share in the first six months of 2009. The increase in net income was primarily the result of improved net interest income, a lower provision for credit losses, a decrease in net securities impairment losses on investments in pooled trust preferred collateralized debt obligations and a decrease in Federal Deposit Insurance Corporation ("FDIC") premiums due to the special assessment of $2.9 million recorded in the second quarter 2009.
(Logo: http://photos.prnewswire.com/prnh/20030416/FIRSTLOGO )
(Logo: http://www.newscom.com/cgi-bin/prnh/20030416/FIRSTLOGO )
John J. Dolan, President and Chief Executive Officer stated, "We are very pleased to report favorable financial results for the second quarter. We have made significant progress toward the resolution of the relatively small number of troubled credits that have caused disproportionate earnings pressure over the last few quarters and have obscured very favorable trends in substantially all other areas of our community banking operations. I couldn’t be more proud of how well First Commonwealth employees are performing during this unprecedented economic period as we continue to move the organization forward."
Credit Quality
The provision for credit losses was $4.0 million and $49.0 million for the second quarter and year to date periods ended June 30, 2010, respectively. The primary components of provision expense for the quarter were:
- A $2.7 million specific reserve for a $3.7 million line of credit to a food processing company located in Pennsylvania.
- An additional specific reserve of $1.8 million for a $39.6 million condominium construction project in south Florida based upon updated appraisal values. During the second quarter of 2010 this loan was substantially charged-off by $34.2 million and we are in the process of exercising default remedies.
- Resolution of three other credits that provided $3.6 million from either recoveries on previously charged-off loans or release of previously established specific reserves. Included in the $3.6 million is $2.7 million of proceeds from bankruptcy proceedings on two loans and $0.9 million on a troubled loan that paid off.
For the quarter ended June 30, 2010, nonperforming loans decreased $34.2 million to $133.2 million from March 31, 2010 primarily a result of the $34.2 million credit loss on the previously mentioned Florida condominium construction loan. Nonperforming loans as a percentage of total loans were 3.00%, 3.64% and 1.81% for the periods ended June 30, 2010, March 31, 2010 and June 30, 2009, respectively.
Other real estate owned ("OREO") acquired through foreclosure was $21.5 million at June 30, 2010 and $18.4 million is related to one property that is currently under a sales agreement.
During the second quarter of 2010, net credit losses were $34.7 million compared to $6.7 million in the second quarter of 2009; $34.2 million in the second quarter of 2010 was related to the aforementioned Florida condominium construction loan. For the six months ended June 30, 2010 net credit losses were $42.6 million, or 1.87% of average loans on an annualized basis, compared to $26.2 million, or 1.18%, for the same period in 2009. The allowance for credit losses as a percentage of total loans outstanding was 1.99%, 2.58% and 1.83% for June 30, 2010, March 31, 2010 and June 30, 2009, respectively.
Net Interest Income and Net Margin
During the second quarter of 2010 net interest income, on a fully taxable equivalent basis, increased $0.7 million, or 1%, compared to the second quarter of 2009. The increase was a result of a 15 basis point increase in the net interest margin, partially offset by a decline in average interest-earning assets. Net interest margin was 3.88%, 3.87% and 3.73% for the three-month periods ended June 30, 2010, March 31, 2010 and June 30, 2009, respectively. The improved net interest margin is the result of a more favorable deposit mix, improved loan pricing and reduced balance sheet leveraging. For the six months ended June 30, 2010 net interest income, on a fully taxable equivalent basis, increased $2.8 million, or 3%. The increase was due to a 16 basis point increase in the net interest margin, partially offset by a decline in average interest-earning assets. The net interest margin for the six months ended June 30, 2010 and 2009, respectively, was 3.88% and 3.72%.
Mr. Dolan added, "We have made noteworthy progress over the past twelve months to reduce the risk of our balance sheet by lowering our dependence on wholesale funding, reducing our exposure to large sized and out-of-market loans and problem credits. This will remain a major strategic focus going forward, will position us to capitalize on growth opportunities as economic conditions improve and will be more conducive to our community bank mission and philosophy."
Significant changes to First Commonwealth's balance sheet from the quarter to date average balances at June 30, 2009 to the comparable period at June 30, 2010 include:
- A $488.7 million, or 36%, reduction in average borrowings, driven by a $273.8 million, or 20%, decrease in average investment securities and a $304.7 million, or 7%, growth in average deposits. The decline in investment securities is the result of maturities and selective sales as the risk/reward for balance sheet leveraging activities has become less attractive in the current interest rate environment.
- An increase of $40.5 million in average loans. The modest increase is a result of planned decreases in residential real estate loans, more disciplined underwriting guidelines concerning geography and size for commercial loans and weak borrower demand, generally, in the recessionary economic environment.
- Continued improvement in the mix of deposits, as a $431.7 million, or 16%, growth in lower costing transaction and savings deposits has more than offset a $127.0 million decrease in time deposits.
Non-Interest Income
Recognized net security losses, which includes net impairment losses and net securities gains, were $1.5 million, $2.3 million and $8.7 million for the three-month periods ended June 30, 2010, March 31, 2010 and June 30, 2009, respectively. These losses resulted primarily from other-than-temporary impairment charges on investments in pooled trust preferred collateralized debt obligations. Net security losses for the three month period ended June 30, 2010 include $0.6 million of realized gains from the sale and calls of municipal securities and equity securities. For the six months ended June 30, 2010 and 2009, net security losses were $3.9 million and $18.5 million, respectively.
The company’s pooled trust preferred collateralized debt obligations consist of 14 securities comprised of 371 banks and other financial institutions. Two pooled securities are senior tranches and the remaining 12 are mezzanine tranches. As of June 30, 2010, the book value of pooled securities totaled $64.4 million with an estimated fair value of $28.7 million. In the second quarter of 2010, a $2.0 million other-than-temporary impairment charge was recorded for three trust preferred collateralized debt obligations that are expected to experience a principal shortfall. The amount of impairment charge recognized represents the expected credit loss on these securities.
Non-interest income, excluding net security losses, decreased $1.2 million in the second quarter of 2010 compared to the same period last year primarily due to a $2.1 million gain from a favorable legal settlement recorded in other income in the second quarter of 2009. All other categories in non-interest income improved from the year ago period.
For the six months ended June 30, 2010, non-interest income, excluding net security losses, was essentially flat at $28.0 million when compared to the same period of 2009. Trust and insurance income increased $1.0 million as a result of increased market values of assets under management and higher commissions on annuity sales, as additional producers and an enhanced calling program yielded higher sales. Card-related interchange income increased $1.0 million due to growth in usage of debit cards, increased demand deposit accounts and larger dollar transactions. Service charges on deposit accounts increased $0.5 million due to increased overdraft and account analysis fees, and the addition of new demand deposit customers. Income from bank owned life insurance increased $0.4 million as a result of higher crediting rates. Offsetting these increases was the aforementioned $2.1 million gain from a legal settlement in the second quarter of 2009.
Non-Interest Expense
Non-interest expense decreased $1.7 million, or 4%, in the second quarter of 2010 from the second quarter of 2009. For the six months ended June 30, 2010, as compared to the same period last year, non-interest expense decreased $1.8 million, or 2%. Contributing to these decreases were an expense reduction initiative in 2009, declines in FDIC insurance due to the special assessment of $2.9 million recorded in the second quarter 2009 and $0.9 million of collection and repossession expenses primarily related to two loans that were transferred to other real estate owned in the first quarter of 2009. Partially offsetting these decreases were increases in data processing, software and maintenance expense of $1.1 million due to higher investments in technology solutions and a $2.2 million write-down to current fair value for an OREO property that is currently under a sales agreement.
Full time equivalent staff was 1,605 and 1,675 for the periods ended June 30, 2010 and 2009, respectively. The efficiency ratio, calculated as total non-interest expense as a percentage of total revenue (total revenue consists of net interest income, on a fully tax-equivalent basis, plus total non-interest income, excluding net impairment losses), improved to 62% for the six months ended June 30, 2010 from 65% during the same period in 2009.
Conference Call
First Commonwealth will host its quarterly conference call to discuss its financial results for the second quarter of 2010 on Thursday, July 29, 2010 at 2:00 PM (ET). The call can be accessed by dialing (toll free) 1-800-860-2442 or through our web page, http://www.fcbanking.com at our "Investor Relations" link. A replay of the call will be available one hour after the end of the conference at this web page for 30 days.
About First Commonwealth Financial Corporation
First Commonwealth Financial Corporation is a $6.1 billion financial holding company headquartered in Indiana, Pennsylvania. It operates 115 retail branch offices in 15 counties in western and central Pennsylvania through First Commonwealth Bank, a Pennsylvania chartered bank and trust company. Financial services and insurance products are also provided through First Commonwealth Insurance Agency and First Commonwealth Financial Advisors, Inc.
Forward-Looking Statements
This release contains forward-looking statements about First Commonwealth’s future plans, strategies and financial performance. These statements can be identified by the fact that they do not relate strictly to historical or current facts and often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may." Such statements are based on assumptions and involve risks and uncertainties, many of which are beyond our control and which may cause actual results, performance or achievements to differ materially from the results, performance or achievements contemplated by the forward-looking statements. These risks and uncertainties include, among other things, the following: continued deterioration in general business and economic conditions; changes in interest rates; deterioration in the credit quality of our loan portfolios or in the value of the collateral securing those loans; deterioration in the value of securities held in our investment securities portfolio; legal and regulatory developments; increased competition from both banks and non-banks; changes in customer behavior and preferences; effects of mergers and acquisitions and related integration; effects of critical accounting policies and judgments; management’s ability to effectively manage credit risk, market risk, operational risk, legal risk, and regulatory and compliance risk; and other risks and uncertainties described in our reports filed with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K. Forward-looking statements speak only as of the date on which they are made. First Commonwealth undertakes no obligation to update any forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.
FIRST COMMONWEALTH FINANCIAL CORPORATION |
||||||||||
CONSOLIDATED SELECTED FINANCIAL DATA |
||||||||||
(dollars in thousands, except share data) |
||||||||||
For the Quarter Ended |
For the Six Months Ended |
|||||||||
June 30, |
March 31, |
December 31, |
September 30, |
June 30, |
June 30, |
June 30, |
||||
2010 |
2010 |
2009 |
2009 |
2009 |
2010 |
2009 |
||||
Interest Income |
||||||||||
Interest and fees on loans |
$57,367 |
$57,408 |
$58,877 |
$57,085 |
$57,793 |
$114,775 |
$116,068 |
|||
Interest and dividends on investments: |
||||||||||
Taxable interest |
9,664 |
10,467 |
11,300 |
12,406 |
13,177 |
20,131 |
26,885 |
|||
Interest exempt from federal income taxes |
1,839 |
2,151 |
2,351 |
2,540 |
2,660 |
3,990 |
5,554 |
|||
Dividends |
19 |
27 |
25 |
31 |
89 |
46 |
152 |
|||
Interest on bank deposits |
48 |
25 |
4 |
1 |
1 |
73 |
2 |
|||
Total interest income |
68,937 |
70,078 |
72,557 |
72,063 |
73,720 |
139,015 |
148,661 |
|||
Interest Expense |
||||||||||
Interest on deposits |
13,067 |
13,580 |
15,338 |
17,014 |
17,874 |
26,647 |
37,450 |
|||
Interest on short-term borrowings |
616 |
852 |
789 |
947 |
1,133 |
1,468 |
2,480 |
|||
Interest on subordinated debentures |
1,390 |
1,375 |
1,398 |
1,447 |
1,559 |
2,765 |
3,325 |
|||
Interest on other long-term debt |
1,268 |
1,173 |
1,592 |
1,672 |
1,666 |
2,441 |
3,319 |
|||
Total interest on long-term debt |
2,658 |
2,548 |
2,990 |
3,119 |
3,225 |
5,206 |
6,644 |
|||
Total interest expense |
16,341 |
16,980 |
19,117 |
21,080 |
22,232 |
33,321 |
46,574 |
|||
Net Interest Income |
52,596 |
53,098 |
53,440 |
50,983 |
51,488 |
105,694 |
102,087 |
|||
Tax equivalent adjustment |
2,639 |
2,798 |
2,975 |
3,052 |
3,091 |
5,437 |
6,276 |
|||
Net Interest Income (FTE) (a) |
55,235 |
55,896 |
56,415 |
54,035 |
54,579 |
111,131 |
108,363 |
|||
Provision for credit losses |
4,010 |
45,020 |
21,059 |
23,020 |
48,248 |
49,030 |
56,490 |
|||
Net Interest Income after provision for credit losses (FTE) (a) |
51,225 |
10,876 |
35,356 |
31,015 |
6,331 |
62,101 |
51,873 |
|||
Non-Interest Income |
||||||||||
Change in fair value on impaired securities |
190 |
(1,517) |
(4,091) |
(25,473) |
(14,421) |
(1,327) |
(43,010) |
|||
Noncredit-related (gains) losses on securities not expected to |
||||||||||
be sold (recognized in other comprehensive income) |
(2,300) |
(1,233) |
(1,564) |
13,570 |
5,660 |
(3,533) |
24,383 |
|||
Net impairment losses |
(2,110) |
(2,750) |
(5,655) |
(11,903) |
(8,761) |
(4,860) |
(18,627) |
|||
Net securities gains |
562 |
420 |
149 |
44 |
56 |
982 |
80 |
|||
Trust income |
1,398 |
1,494 |
1,201 |
1,366 |
1,151 |
2,892 |
2,238 |
|||
Service charges on deposit accounts |
4,603 |
4,152 |
4,642 |
4,555 |
4,406 |
8,755 |
8,243 |
|||
Insurance and retail brokerage commissions |
1,866 |
1,862 |
1,819 |
2,068 |
1,756 |
3,728 |
3,372 |
|||
Income from bank owned life insurance |
1,301 |
1,257 |
1,192 |
1,078 |
1,034 |
2,558 |
2,172 |
|||
Card related interchange income |
2,686 |
2,320 |
2,301 |
2,224 |
2,138 |
5,006 |
4,034 |
|||
Other income |
2,343 |
2,696 |
3,220 |
1,569 |
4,935 |
5,039 |
7,943 |
|||
Total non-interest income |
12,649 |
11,451 |
8,869 |
1,001 |
6,715 |
24,100 |
9,455 |
|||
Non-Interest Expense |
||||||||||
Salaries and employee benefits |
21,047 |
22,327 |
21,073 |
21,405 |
21,081 |
43,374 |
43,581 |
|||
Net occupancy expense |
3,539 |
3,893 |
3,262 |
3,263 |
3,528 |
7,432 |
7,528 |
|||
Furniture and equipment expense |
3,101 |
3,165 |
3,012 |
3,121 |
2,977 |
6,266 |
5,952 |
|||
Data processing expense |
1,478 |
1,437 |
1,254 |
1,136 |
1,165 |
2,915 |
2,297 |
|||
Pennsylvania shares tax expense |
1,457 |
1,057 |
1,361 |
1,310 |
1,312 |
2,514 |
2,643 |
|||
Intangible amortization |
576 |
657 |
656 |
684 |
743 |
1,233 |
1,486 |
|||
Collection and repossession expense |
794 |
923 |
915 |
1,444 |
1,750 |
1,717 |
2,651 |
|||
Other professional fees |
1,062 |
1,166 |
796 |
723 |
847 |
2,228 |
1,910 |
|||
FDIC insurance |
2,012 |
1,963 |
2,041 |
2,046 |
4,863 |
3,975 |
6,384 |
|||
Loss on sale or write-down of assets |
2,314 |
83 |
140 |
50 |
83 |
2,397 |
112 |
|||
Other expenses |
6,298 |
6,568 |
6,013 |
6,763 |
6,986 |
12,866 |
14,139 |
|||
Total non-interest expense |
43,678 |
43,239 |
40,523 |
41,945 |
45,335 |
86,917 |
88,683 |
|||
Income (Loss) before income taxes |
20,196 |
(20,912) |
3,702 |
(9,929) |
(32,289) |
(716) |
(27,355) |
|||
Taxable equivalent adjustment |
2,639 |
2,798 |
2,975 |
3,052 |
3,091 |
5,437 |
6,276 |
|||
Income tax (benefit) provision |
4,015 |
(10,542) |
(2,002) |
(7,120) |
(16,761) |
(6,527) |
(16,699) |
|||
Net Income (Loss) |
$13,542 |
($13,168) |
$2,729 |
($5,861) |
($18,619) |
$374 |
($16,932) |
|||
Average Shares Outstanding |
85,777,550 |
85,029,748 |
84,681,199 |
84,594,952 |
84,559,889 |
85,405,715 |
84,540,684 |
|||
Average Shares Outstanding Assuming Dilution |
85,788,566 |
85,029,748 |
84,681,199 |
84,594,952 |
84,559,889 |
85,412,371 |
84,540,684 |
|||
Per Share Data: |
||||||||||
Basic Earnings (Loss) Per Share |
$0.15 |
($0.15) |
$0.03 |
($0.07) |
($0.22) |
$0.00 |
($0.20) |
|||
Diluted Earnings (Loss) Per Share |
$0.15 |
($0.15) |
$0.03 |
($0.07) |
($0.22) |
$0.00 |
($0.20) |
|||
Cash Dividends Declared per Common Share |
$0.01 |
$0.03 |
$0.03 |
$0.03 |
$0.00 |
$0.04 |
$0.12 |
|||
(a) FTE - Fully tax equivalent net interest income is net interest income adjusted for the effect of tax-exempt income as if it were taxable using the 35% federal income tax statutory rate. |
||||||||||
FIRST COMMONWEALTH FINANCIAL CORPORATION CONSOLIDATED SELECTED FINANCIAL DATA (dollars in thousands, except share data) |
|||||||
June 30, |
March 31, |
December 31, |
September 30, |
June 30, |
|||
2010 |
2010 |
2009 |
2009 |
2009 |
|||
Assets |
|||||||
Cash and due from banks |
$86,855 |
$79,136 |
$89,232 |
$79,694 |
$84,346 |
||
Interest-bearing bank deposits |
1,503 |
57,073 |
327 |
332 |
961 |
||
Securities available for sale, at fair value |
996,220 |
1,062,713 |
1,133,856 |
1,231,015 |
1,264,685 |
||
Securities held to maturity, at amortized cost, |
|||||||
(Fair value $0 at June 30, 2010 |
0 |
31,891 |
36,758 |
41,397 |
44,398 |
||
Other Investments |
51,431 |
51,431 |
51,431 |
51,431 |
51,431 |
||
Loans: |
|||||||
Portfolio loans |
4,434,291 |
4,595,409 |
4,636,501 |
4,649,034 |
4,536,771 |
||
Allowance for credit losses |
(88,046) |
(118,725) |
(81,639) |
(90,466) |
(83,056) |
||
Net loans |
4,346,245 |
4,476,684 |
4,554,862 |
4,558,568 |
4,453,715 |
||
Premises and equipment, net |
69,203 |
70,357 |
70,742 |
72,074 |
72,379 |
||
Other real estate owned |
21,548 |
23,191 |
24,287 |
24,138 |
25,565 |
||
Goodwill |
159,956 |
159,956 |
159,956 |
159,956 |
159,956 |
||
Amortizing intangibles, net |
6,175 |
6,752 |
7,407 |
8,063 |
8,747 |
||
Other assets |
318,933 |
324,645 |
317,435 |
284,771 |
282,814 |
||
Total assets |
$6,058,069 |
$6,343,829 |
$6,446,293 |
$6,511,439 |
$6,448,997 |
||
Liabilities |
|||||||
Deposits (all domestic): |
|||||||
Noninterest-bearing |
$651,250 |
$639,184 |
$641,231 |
$599,842 |
$592,219 |
||
Interest-bearing demand deposits |
107,261 |
99,218 |
107,612 |
93,062 |
99,281 |
||
Savings deposits |
2,360,648 |
2,273,714 |
2,175,953 |
2,133,203 |
2,045,970 |
||
Time deposits |
1,619,479 |
1,640,153 |
1,610,989 |
1,670,930 |
1,748,420 |
||
Total interest-bearing |
4,087,388 |
4,013,085 |
3,894,554 |
3,897,195 |
3,893,671 |
||
Total deposits |
4,738,638 |
4,652,269 |
4,535,785 |
4,497,037 |
4,485,890 |
||
Short-term borrowings |
355,682 |
794,195 |
958,932 |
1,043,447 |
998,259 |
||
Subordinated debentures |
105,750 |
105,750 |
105,750 |
105,750 |
105,750 |
||
Other long-term debt |
155,250 |
119,084 |
168,697 |
179,784 |
180,922 |
||
Total long-term debt |
261,000 |
224,834 |
274,447 |
285,534 |
286,672 |
||
Other liabilities |
48,499 |
39,452 |
38,318 |
42,276 |
44,866 |
||
Total liabilities |
5,403,819 |
5,710,750 |
5,807,482 |
5,868,294 |
5,815,687 |
||
Shareholders' Equity |
|||||||
Preferred stock, $1 par value per share, 3,000,000 shares authorized, none issued |
0 |
0 |
0 |
0 |
0 |
||
Common stock, $1 par value per share, 200,000,000 shares authorized; |
|||||||
86,971,329 shares issued and 86,242,139 shares outstanding |
|||||||
at June 30, 2010; |
|||||||
86,600,431 shares issued and 85,151,875 shares outstanding |
|||||||
at December 31, 2009 |
86,971 |
86,755 |
86,600 |
86,600 |
86,600 |
||
Additional paid-in capital |
303,961 |
302,841 |
301,523 |
302,418 |
302,602 |
||
Retained earnings |
271,139 |
258,593 |
278,887 |
278,695 |
287,092 |
||
Accumulated other comprehensive income (loss), net |
5,236 |
(1,181) |
(6,045) |
(762) |
(18,618) |
||
Treasury stock (729,190 and 1,448,556 shares at June 30, 2010 and |
|||||||
December 31, 2009, respectively, at cost) |
(8,457) |
(8,829) |
(16,554) |
(17,706) |
(17,766) |
||
Unearned ESOP shares |
(4,600) |
(5,100) |
(5,600) |
(6,100) |
(6,600) |
||
Total shareholders' equity |
654,250 |
633,079 |
638,811 |
643,145 |
633,310 |
||
Total liabilities and shareholders' equity |
$6,058,069 |
$6,343,829 |
$6,446,293 |
$6,511,439 |
$6,448,997 |
||
Book value per share |
$7.59 |
$7.36 |
$7.50 |
$7.56 |
$7.45 |
||
Market value per share |
$5.25 |
$6.71 |
$4.65 |
$5.68 |
$6.34 |
||
FIRST COMMONWEALTH FINANCIAL CORPORATION |
||||||||
CONSOLIDATED SELECTED FINANCIAL DATA |
||||||||
Quarter To Date Average Balance Sheets and Net Interest Analysis at June 30, |
||||||||
(dollars in thousands) |
||||||||
2010 |
2009 |
|||||||
Average Balance |
Income/Expense (a) |
Yield or Rate |
Average Balance |
Income/Expense (a) |
Yield or Rate |
|||
Assets |
||||||||
Interest-earning assets: |
||||||||
Interest-bearing deposits with banks |
$74,996 |
$48 |
0.26% |
$767 |
$1 |
0.43% |
||
Tax-free investment securities |
170,002 |
2,830 |
6.68% |
238,958 |
4,092 |
6.87% |
||
Taxable investment securities |
907,504 |
9,683 |
4.28% |
1,112,350 |
13,266 |
4.78% |
||
Loans, net of unearned income (b)(c) |
4,552,312 |
59,015 |
5.20% |
4,511,811 |
59,452 |
5.29% |
||
Total interest-earning assets |
$5,704,814 |
$71,576 |
5.03% |
$5,863,886 |
$76,811 |
5.25% |
||
Noninterest-earning assets: |
||||||||
Cash |
77,141 |
75,318 |
||||||
Allowance for credit losses |
(123,418) |
(43,039) |
||||||
Other assets |
595,621 |
555,202 |
||||||
Total noninterest-earning assets |
549,344 |
587,481 |
||||||
Total Assets |
$6,254,158 |
$6,451,367 |
||||||
Liabilities and Shareholders' Equity |
||||||||
Interest-bearing liabilities: |
||||||||
Interest-bearing demand deposits (d) |
$631,324 |
$211 |
0.13% |
$611,384 |
$431 |
0.28% |
||
Savings deposits (d) |
1,790,488 |
3,316 |
0.74% |
1,430,613 |
3,883 |
1.09% |
||
Time deposits |
1,639,045 |
9,540 |
2.33% |
1,766,035 |
13,560 |
3.08% |
||
Short-term borrowings |
661,068 |
616 |
0.37% |
1,068,183 |
1,133 |
0.43% |
||
Long-term debt |
206,634 |
2,658 |
5.16% |
288,263 |
3,225 |
4.49% |
||
Total interest-bearing liabilities |
$4,928,559 |
$16,341 |
1.33% |
$5,164,478 |
$22,232 |
1.73% |
||
Noninterest-bearing liabilities and shareholders' equity: |
||||||||
Noninterest-bearing demand deposits (d) |
640,105 |
588,246 |
||||||
Other liabilities |
39,797 |
39,823 |
||||||
Shareholders' equity |
645,697 |
658,820 |
||||||
Total noninterest-bearing funding sources |
1,325,599 |
1,286,889 |
||||||
Total Liabilities and Shareholders' Equity |
$6,254,158 |
$6,451,367 |
||||||
Net Interest Income and Net Yield on Interest-Earning Assets |
$55,235 |
3.88% |
$54,579 |
3.73% |
||||
(a) Income on interest-earning assets is shown on a fully tax equivalent basis using the 35% federal income tax statutory rate. |
||||||||
(b) Income on nonaccrual loans is accounted for on the cash basis, and the loan balances are included in interest-earning assets. |
||||||||
(c) Loan income includes loan fees. |
||||||||
(d) Average balances do not include reallocations from noninterest-bearing demand deposits and interest-bearing demand |
||||||||
FIRST COMMONWEALTH FINANCIAL CORPORATION |
|||||||||
CONSOLIDATED SELECTED FINANCIAL DATA |
|||||||||
Year To Date Average Balance Sheets and Net Interest Analysis at June 30, |
|||||||||
(dollars in thousands) |
|||||||||
2010 |
2009 |
||||||||
Average Balance |
Income/Expense (a) |
Yield or Rate |
Average Balance |
Income/Expense (a) |
Yield or Rate |
||||
Assets |
|||||||||
Interest-earning assets: |
|||||||||
Interest-bearing deposits with banks |
$57,005 |
$73 |
0.26% |
$790 |
$2 |
0.47% |
|||
Tax-free investment securities |
184,296 |
6,139 |
6.72% |
248,540 |
8,544 |
6.93% |
|||
Taxable investment securities |
942,203 |
20,177 |
4.32% |
1,131,230 |
27,037 |
4.82% |
|||
Loans, net of unearned income (b)(c) |
4,593,781 |
118,063 |
5.18% |
4,486,216 |
119,354 |
5.37% |
|||
Total interest-earning assets |
5,777,285 |
144,452 |
5.04% |
5,866,776 |
154,937 |
5.33% |
|||
Noninterest-earning assets: |
|||||||||
Cash |
76,322 |
74,721 |
|||||||
Allowance for credit losses |
(103,920) |
(48,187) |
|||||||
Other assets |
591,143 |
541,810 |
|||||||
Total noninterest-earning assets |
563,545 |
568,344 |
|||||||
Total Assets |
$6,340,830 |
$6,435,120 |
|||||||
Liabilities and Shareholders' Equity |
|||||||||
Interest-bearing liabilities: |
|||||||||
Interest-bearing demand deposits (d) |
$615,618 |
$416 |
0.14% |
$598,399 |
$980 |
0.33% |
|||
Savings deposits (d) |
1,758,365 |
6,870 |
0.79% |
1,373,299 |
8,294 |
1.22% |
|||
Time deposits |
1,639,283 |
19,361 |
2.38% |
1,796,155 |
28,176 |
3.16% |
|||
Short-term borrowings |
761,066 |
1,468 |
0.39% |
1,100,660 |
2,480 |
0.45% |
|||
Long-term debt |
249,778 |
5,206 |
4.20% |
289,133 |
6,644 |
4.63% |
|||
Total interest-bearing liabilities |
5,024,110 |
33,321 |
1.34% |
5,157,646 |
46,574 |
1.82% |
|||
Noninterest-bearing liabilities and shareholders' equity: |
|||||||||
Noninterest-bearing demand deposits (d) |
629,202 |
574,488 |
|||||||
Other liabilities |
37,799 |
42,587 |
|||||||
Shareholders' equity |
649,719 |
660,399 |
|||||||
Total noninterest-bearing funding sources |
1,316,720 |
1,277,474 |
|||||||
Total Liabilities and Shareholders' Equity |
$6,340,830 |
$6,435,120 |
|||||||
Net Interest Income and Net Yield on Interest-Earning Assets |
$111,131 |
3.88% |
$108,363 |
3.72% |
|||||
(a) Yields on interest-earning assets have been computed on a tax equivalent basis using the 35% federal income tax statutory rate. |
|||||||||
(b) Income on nonaccrual loans is accounted for on the cash basis, and the loan balances are included in interest-earning assets. |
|||||||||
(c) Loan income includes loan fees. |
|||||||||
(d) Average balances do not include reallocations from noninterest-bearing demand deposits and interest-bearing demand |
|||||||||
FIRST COMMONWEALTH FINANCIAL CORPORATION |
|||||||
CONSOLIDATED SELECTED FINANCIAL DATA |
|||||||
Asset Quality Data |
|||||||
(dollars in thousands) |
|||||||
June 30, |
March 31, |
December 31, |
September 30, |
June 30, |
|||
2010 |
2010 |
2009 |
2009 |
2009 |
|||
Nonperforming Loans: |
|||||||
Loans on nonaccrual basis |
$132,555 |
$166,779 |
$147,937 |
$133,200 |
$81,285 |
||
Troubled debt restructured loans |
599 |
609 |
619 |
627 |
637 |
||
Total nonperforming loans |
$133,154 |
$167,388 |
$148,556 |
$133,827 |
$81,922 |
||
Loans past due in excess of 90 days and still accruing |
$15,045 |
$13,371 |
$15,154 |
$14,369 |
$14,978 |
||
Loans outstanding at end of period |
$4,434,291 |
$4,595,409 |
$4,636,501 |
$4,649,034 |
$4,536,771 |
||
Average loans outstanding |
$4,593,781 |
$4,635,712 |
$4,557,227 |
$4,524,567 |
$4,486,216 |
||
Allowance for credit losses |
$88,046 |
$118,725 |
$81,639 |
$90,466 |
$83,056 |
||
Nonperforming loans as a percentage of total loans |
3.00% |
3.64% |
3.20% |
2.88% |
1.81% |
||
Provision for credit losses (Year To Date) |
$49,030 |
$45,020 |
$100,569 |
$79,510 |
$56,490 |
||
Net credit losses (Year To Date) |
$42,623 |
$7,934 |
$71,689 |
$41,803 |
$26,193 |
||
Net credit losses as a percentage of average loans |
|||||||
outstanding (annualized) |
1.87% |
0.69% |
1.57% |
1.24% |
1.18% |
||
Allowance for credit losses as a percentage of end-of-period |
|||||||
loans outstanding |
1.99% |
2.58% |
1.76% |
1.95% |
1.83% |
||
Allowance for credit losses as a percentage of nonperforming |
|||||||
loans |
66.12% |
70.93% |
54.96% |
67.60% |
101.38% |
||
Other real estate owned |
$21,548 |
$23,191 |
$24,287 |
$24,138 |
$25,565 |
||
Nonperforming Securities: |
|||||||
Nonaccrual securities at market value |
$6,483 |
$6,553 |
$3,258 |
$3,503 |
$530 |
||
Profitability Ratios |
||||||||||
(dollars in thousands) |
||||||||||
For the Quarter Ended |
For the Six Months Ended |
|||||||||
June 30, |
March 31, |
December 31, |
September 30, |
June 30, |
June 30, |
June 30, |
||||
2010 |
2010 |
2009 |
2009 |
2009 |
2010 |
2009 |
||||
Return on average assets(a) |
0.87% |
-0.83% |
0.17% |
-0.36% |
-1.16% |
0.01% |
-0.53% |
|||
Return on average equity(a) |
8.41% |
-8.17% |
1.65% |
-3.58% |
-11.34% |
0.12% |
-5.17% |
|||
Net interest margin (b) |
3.88% |
3.87% |
3.78% |
3.62% |
3.73% |
3.88% |
3.72% |
|||
Efficiency ratio (c) |
62.40% |
61.68% |
57.12% |
62.66% |
64.71% |
62.04% |
65.00% |
|||
(a) Annualized. |
||||||||||
(b) Net interest margin has been computed on a tax equivalent basis using the 35% federal income tax statutory rate. |
||||||||||
(c) Efficiency ratio is "total non-interest expense" as a percentage of total revenue. |
||||||||||
Total revenue consists of "net interest income, on a fully tax-equivalent basis," plus "total non-interest income," excluding "net impairment losses." |
||||||||||
FIRST COMMONWEALTH FINANCIAL CORPORATION |
||||||||
CONSOLIDATED SELECTED FINANCIAL DATA |
||||||||
Capital Ratios |
||||||||
(dollars in thousands) |
||||||||
Excess Over |
||||||||
As of June 30, 2010 |
Regulatory Minimum |
Well Capitalized |
Well Capitalized |
|||||
Capital |
Capital |
Capital |
Capital |
|||||
Amount |
Ratio |
Amount |
Ratio |
Amount |
Ratio |
Amount |
||
Total Capital to Risk Weighted Assets |
||||||||
First Commonwealth Financial Corporation |
$615,778 |
11.6% |
$423,698 |
8.0% |
N/A |
N/A |
N/A |
|
First Commonwealth Bank |
$596,475 |
11.4% |
$418,802 |
8.0% |
$523,502 |
10.0% |
$72,973 |
|
Tier I Capital to Risk Weighted Assets |
||||||||
First Commonwealth Financial Corporation |
$549,299 |
10.4% |
$211,849 |
4.0% |
N/A |
N/A |
N/A |
|
First Commonwealth Bank |
$530,751 |
10.1% |
$209,401 |
4.0% |
$314,101 |
6.0% |
$216,650 |
|
Tier I Capital to Average Assets |
||||||||
First Commonwealth Financial Corporation |
$549,299 |
9.0% |
$243,521 |
4.0% |
N/A |
N/A |
N/A |
|
First Commonwealth Bank |
$530,751 |
8.8% |
$240,980 |
4.0% |
$301,225 |
5.0% |
$229,526 |
|
SOURCE First Commonwealth Financial Corporation
Share this article