WesBanco Announces Improved Second Quarter 2010 Results
WHEELING, W.Va., July 26 /PRNewswire-FirstCall/ -- Paul M. Limbert, President and Chief Executive Officer of WesBanco, Inc. (Nasdaq: WSBC), a Wheeling, West Virginia based multi-state bank holding company, today announced earnings for the second quarter and year-to-date periods ended June 30, 2010.
Net income available to common shareholders for the quarter ended June 30, 2010 was $8.2 million as compared to $4.7 million for the second quarter of 2009, representing an increase of 75.8%, while diluted earnings per common share were $0.31, as compared to $0.18 per common share for the second quarter of 2009. For the six month period, net income available to common shareholders was $16.1 million or $0.61 per common share, while for the same period in 2009, net income was $9.1 million or $0.34 per common share. Net income available to common shareholders increased 77.8% in the first half of 2010 as compared to 2009.
Mr. Limbert commented, "The last two years have been challenging for the banking industry and the economy as a whole. However, WesBanco has been able to maintain profitability and grow its net income by approximately 78% during 2010. This is the third consecutive quarter of growth in net income on a linked-quarter basis. We are pleased with the earnings recovery for the first half of 2010 and the resulting continued improvement in our capital ratios, which are above regulatory "well-capitalized" levels. The growth in net income was achieved by improving net interest income, improving revenues from the Trust, Securities and Insurance business units and a multiple year effort to control costs without affecting either the quality of our operations or our revenue-generating capability."
Net Interest Income
Net interest income increased $1.9 million or 4.8% in the second quarter and $4.4 million or 5.7% in the first half of 2010 as compared to the same periods in 2009 due to increases in the net interest margin, as the low interest environment continued to reduce the cost of funds. Net interest income has now increased for five consecutive quarters. The net interest margin increased 39 basis points in the second quarter to 3.56% and 26 basis points in the first half of 2010 as compared to the same periods in 2009 due to the average rate on interest bearing liabilities decreasing by 60 basis points in both periods, while the rate on earning assets declined at a much slower pace of 14 basis points in the second quarter and 25 basis points in the first half. Lower rates on deposits, maturities of higher rate certificates of deposit and an increase in lower cost deposits, primarily money market accounts, all contributed to the improvement in the cost of funds. In addition, the average balance for borrowings, which generally have higher interest rates, decreased by $236.3 million or 28.9% in the second quarter of 2010 from the second quarter of 2009, through planned reductions utilizing the liquidity obtained through the branch acquisition in the first quarter of 2009 and pay downs on loans. The margin also benefited from a 5.0% increase in average non-interest bearing deposit balances in the second quarter.
Provision and Allowance for Credit Losses
The provision for credit losses increased $1.4 million in the second quarter and $3.4 million in the first six months of 2010 compared to the same periods of 2009, but increased only $0.2 million from the first quarter of 2010. As compared to the second quarter and first half of 2009, the provision expense was higher reflecting the general deterioration of credit quality due to the prolonged recession, resulting in higher amounts of impaired loans and net charge-offs, particularly for commercial real estate loans.
Non-performing loans increased $14.3 million as compared to December 31, 2009, but decreased $3.1 million from the first quarter of 2010. However, most of this year-to-date increase in non-performing loans is attributable to a $14.5 million increase in renegotiated loans as non-accrual loans were relatively unchanged from year end. Net charge-offs increased $5.1 million in the second quarter as compared to the first quarter of 2010 primarily due to $3.2 million of charge-offs relating to the sale of three loans with specific reserves totaling $1.5 million included in the provision in prior quarters. The year-to-date provision, net of charge-offs, increased the allowance to 1.92% of total loans at June 30, 2010 as compared to 1.76% at December 31, 2009 and 1.65% at June 30, 2009.
Non-Interest Income and Non-Interest Expense
In the second quarter of 2010 non-interest income decreased $1.7 million as compared to the second quarter of 2009 and increased $0.9 million in the year-to-date period as compared to 2009. The quarterly decrease was principally due to a $1.6 million difference in securities gains between the two periods and a $1.3 million write down of a hotel property in other real estate owned. The year-to-date increase is due to a 15.9% increase in trust fees due to improved market conditions and increases in revenue from most other major non-interest operating areas including mortgage banking, electronic banking activity fees and securities brokerage revenue, somewhat offset by $2.8 million in year-to-date write-downs of the aforementioned hotel property.
Non-interest expenses decreased $5.0 million in the second quarter and $4.4 million year-to-date as compared to the same periods in 2009. FDIC insurance decreased $2.6 million for the quarter and $2.3 million year-to-date due to a special assessment of $2.6 million in the second quarter of 2009. In addition to this decrease, WesBanco significantly reduced expenses in many other categories including salaries and wages, employee benefits, marketing and professional fees, partially offset by increases in foreclosure-related property expenses. Excluding the effect of the special assessment, non-interest expense has decreased in each of the last three consecutive quarters.
Financial Condition
Total assets were little changed in the first six months of 2010 as compared to year end, but decreased 6.6% from last June. Portfolio loans decreased 4.0% from last June, primarily due to continued strategic decreases in residential real estate, reduced demand for commercial and consumer loans and a focus on appropriate credit terms for new borrowers. Total deposits increased by 0.3%; however, money market deposits increased 26.9%, which, combined with smaller increases in non-interest bearing demand and savings deposits more than offset an 11% decrease in CDs. The reduction in CDs was due to planned reductions of non-relationship customers acquired with the branch acquisition in 2009. Total borrowings, excluding junior subordinated debt, decreased by $321.3 million or 39.7% as compared to June 30, 2009 and 28.9% as compared to December 31, 2009, funded by the increased deposits and the decreases in loans. This planned reduction in borrowings over the past year has assisted in improving the net interest margin as well as improving capital ratios. Overall balance sheet strategies resulted in a reduction of total average earning assets by 7.8% in the second quarter and 2.9% for the six month period as compared to 2009.
As of April 30, 2010, available-for-sale securities with a fair value of $426.7 million were transferred at fair value to the held-to-maturity portfolio. The related net unrealized gain of $8.9 million was recorded as a premium on the transferred securities. The premium will be amortized over the remaining life of the securities through other comprehensive income. The transfer was completed to mitigate the potential effect of interest rate volatility on unrealized security gains included in capital.
WesBanco continues to maintain strong regulatory capital ratios of 8.13% tier I leverage, 11.61% tier I risk-based capital, and 12.87% total risk-based capital, all of which improved in each of the last three consecutive quarters and are above the "well-capitalized" standards promulgated by bank regulators. Total tangible common equity to tangible assets (non-GAAP measure) improved to 6.27% at June 30, 2010 from 6.06% at March 31, 2010 and from 5.88% at year end, primarily due to balance sheet strategies and a 2.7% increase in shareholders' equity from December 31, 2009. The increase in shareholders' equity was the result of improved results and increases in other comprehensive income due to higher unrealized securities gains.
WesBanco is a multi-state bank holding company with total assets of approximately $5.4 billion, operating through 112 branch locations and 134 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, 2009 and documents subsequently filed by WesBanco with the Securities and Exchange Commission ("SEC"), including WesBanco's Form 10-Q for the quarter ended March 31, 2010, 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 Part I, Item 1A. Risk Factors. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including without limitation, the effects of changing regional and national economic conditions; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to WesBanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, Federal Deposit Insurance Corporation, the SEC, Financial Institution Regulatory Authority, Municipal Securities Rulemaking Board, 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 Wall Street Reform and Consumer Protection 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, greater than expected outflows on recent branch acquisition deposits; marketability of debt instruments and corresponding impact on fair value adjustments; and/or other external developments materially impacting WesBanco's operational and financial performance. WesBanco does not assume any duty to update forward-looking statements.
WESBANCO, INC. |
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Consolidated Selected Financial Highlights |
Page 4 |
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(unaudited, dollars in thousands, except per share amounts) |
|||||||||||||||
For the Three Months Ended |
For the Six Months Ended |
||||||||||||||
STATEMENT OF INCOME |
June 30, |
June 30, |
|||||||||||||
Interest and dividend income |
2010 |
2009 |
% Change |
2010 |
2009 |
% Change |
|||||||||
Loans, including fees |
$ 47,911 |
$ 51,482 |
(6.94%) |
$ 96,285 |
$ 103,541 |
(7.01%) |
|||||||||
Interest and dividends on securities: |
|||||||||||||||
Taxable |
8,724 |
10,791 |
(19.15%) |
17,835 |
18,309 |
(2.59%) |
|||||||||
Tax-exempt |
2,851 |
3,698 |
(22.90%) |
5,845 |
7,212 |
(18.95%) |
|||||||||
Total interest and dividends on securities |
11,575 |
14,489 |
(20.11%) |
23,680 |
25,521 |
(7.21%) |
|||||||||
Other interest income |
111 |
108 |
2.78% |
197 |
218 |
(9.63%) |
|||||||||
Total interest and dividend income |
59,597 |
66,079 |
(9.81%) |
120,162 |
129,280 |
(7.05%) |
|||||||||
Interest Expense |
|||||||||||||||
Interest bearing demand deposits |
636 |
727 |
(12.52%) |
1,306 |
1,377 |
(5.16%) |
|||||||||
Money market deposits |
2,185 |
1,848 |
18.24% |
4,127 |
3,094 |
33.39% |
|||||||||
Savings deposits |
623 |
644 |
(3.26%) |
1,226 |
1,178 |
4.07% |
|||||||||
Certificates of deposit |
9,322 |
14,755 |
(36.82%) |
19,482 |
28,159 |
(30.81%) |
|||||||||
Total interest expense on deposits |
12,766 |
17,974 |
(28.98%) |
26,141 |
33,808 |
(22.68%) |
|||||||||
Federal Home Loan Bank borrowings |
3,567 |
5,614 |
(36.46%) |
7,901 |
11,246 |
(29.74%) |
|||||||||
Other short-term borrowings |
1,173 |
1,770 |
(33.73%) |
2,353 |
3,838 |
(38.69%) |
|||||||||
Junior subordinated debt owed to unconsolidated subsidiary trusts |
943 |
1,470 |
(35.85%) |
1,987 |
3,010 |
(33.99%) |
|||||||||
Total interest expense |
18,449 |
26,828 |
(31.23%) |
38,382 |
51,902 |
(26.05%) |
|||||||||
Net interest income |
41,148 |
39,251 |
4.83% |
81,780 |
77,378 |
5.69% |
|||||||||
Provision for credit losses |
11,675 |
10,269 |
13.69% |
23,175 |
19,819 |
16.93% |
|||||||||
Net interest income after provision for credit losses |
29,473 |
28,982 |
1.69% |
58,605 |
57,559 |
1.82% |
|||||||||
Non-interest income |
|||||||||||||||
Trust fees |
3,636 |
3,288 |
10.58% |
7,694 |
6,641 |
15.86% |
|||||||||
Service charges on deposits |
5,701 |
6,076 |
(6.17%) |
11,018 |
11,294 |
(2.44%) |
|||||||||
Bank-owned life insurance |
966 |
897 |
7.69% |
1,910 |
1,788 |
6.82% |
|||||||||
Net securities gains |
898 |
2,462 |
(63.53%) |
2,303 |
2,604 |
(11.56%) |
|||||||||
Net gains on sales of mortgage loans |
569 |
297 |
91.58% |
1,094 |
785 |
39.36% |
|||||||||
Net loss on other real estate owned and other assets |
(1,315) |
(294) |
347.28% |
(2,845) |
(426) |
567.84% |
|||||||||
Other income |
4,130 |
3,583 |
15.27% |
8,452 |
6,060 |
39.47% |
|||||||||
Total non-interest income |
14,585 |
16,309 |
(10.57%) |
29,626 |
28,746 |
3.06% |
|||||||||
Non-interest expense |
|||||||||||||||
Salaries and wages |
13,362 |
13,998 |
(4.54%) |
26,576 |
27,165 |
(2.17%) |
|||||||||
Employee benefits |
4,347 |
5,061 |
(14.11%) |
9,344 |
9,768 |
(4.34%) |
|||||||||
Net occupancy |
2,540 |
2,361 |
7.58% |
5,599 |
5,105 |
9.68% |
|||||||||
Equipment |
2,376 |
2,687 |
(11.57%) |
4,980 |
5,229 |
(4.76%) |
|||||||||
Marketing |
1,155 |
1,720 |
(32.85%) |
1,785 |
2,476 |
(27.91%) |
|||||||||
FDIC Insurance |
1,683 |
4,322 |
(61.06%) |
3,288 |
5,576 |
(41.03%) |
|||||||||
Amortization of intangible assets |
685 |
812 |
(15.64%) |
1,384 |
1,509 |
(8.28%) |
|||||||||
Restructuring and merger-related expenses |
7 |
192 |
(96.35%) |
206 |
621 |
(66.83%) |
|||||||||
Other operating expenses |
8,412 |
8,392 |
0.24% |
16,798 |
16,909 |
(0.66%) |
|||||||||
Total non-interest expense |
34,567 |
39,545 |
(12.59%) |
69,960 |
74,358 |
(5.91%) |
|||||||||
Income before provision for income taxes |
9,491 |
5,746 |
65.18% |
18,271 |
11,947 |
52.93% |
|||||||||
Provision for income taxes |
1,253 |
2 |
NM |
2,122 |
753 |
181.81% |
|||||||||
Net income |
$ 8,238 |
$ 5,744 |
43.42% |
$ 16,149 |
$ 11,194 |
44.26% |
|||||||||
Preferred dividends and expenses associated with unamortized discount and issuance costs |
- |
1,057 |
(100.00%) |
- |
2,112 |
(100.00%) |
|||||||||
Net Income available to common shareholders |
$ 8,238 |
$ 4,687 |
75.76% |
$ 16,149 |
$ 9,082 |
77.81% |
|||||||||
Taxable equivalent net interest income |
$ 42,683 |
$ 41,242 |
3.49% |
$ 84,928 |
$ 81,261 |
4.51% |
|||||||||
Per common share data |
|||||||||||||||
Net income available per common share - basic |
$ 0.31 |
$ 0.18 |
72.22% |
$ 0.61 |
$ 0.34 |
79.41% |
|||||||||
Net income available per common share - diluted |
$ 0.31 |
$ 0.18 |
72.22% |
$ 0.61 |
$ 0.34 |
79.41% |
|||||||||
Dividends declared |
$ 0.14 |
$ 0.28 |
(50.00%) |
$ 0.28 |
$ 0.56 |
(50.00%) |
|||||||||
Book value (period end) |
$ 22.74 |
$ 24.61 |
(7.60%) |
||||||||||||
Tangible book value (period end) (1) |
$ 11.95 |
$ 13.69 |
(12.71%) |
||||||||||||
Tangible common book value (period end) (1) |
$ 11.95 |
$ 10.96 |
9.03% |
||||||||||||
Average common shares outstanding - basic |
26,577,065 |
26,567,653 |
0.04% |
26,572,385 |
26,564,589 |
0.03% |
|||||||||
Average common shares outstanding - diluted |
26,577,828 |
26,568,752 |
0.03% |
26,572,915 |
26,566,516 |
0.02% |
|||||||||
Period end common shares outstanding |
26,586,903 |
26,567,653 |
0.07% |
26,586,903 |
26,567,653 |
0.07% |
|||||||||
Period end preferred shares outstanding |
- |
75,000 |
(100.00%) |
- |
75,000 |
(100.00%) |
|||||||||
(1) See non-GAAP financial measures for additional information relating to the calculation of this item. |
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NM - Not Meaningful |
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WESBANCO, INC. |
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Consolidated Selected Financial Highlights |
Page 5 |
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(unaudited, dollars in thousands) |
||||||||||||||
Selected ratios |
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For the Six Months Ended |
||||||||||||||
June 30, |
||||||||||||||
2010 |
2009 |
% Change |
||||||||||||
Return on average assets |
0.60 |
% |
0.41 |
% |
47.68 |
% |
||||||||
Return on average equity |
5.42 |
3.40 |
59.14 |
|||||||||||
Return on average tangible equity (2) |
10.96 |
6.39 |
71.64 |
|||||||||||
Yield on earning assets (1) |
5.18 |
5.43 |
(4.58) |
|||||||||||
Cost of interest bearing liabilities |
1.82 |
2.42 |
(24.61) |
|||||||||||
Net interest spread (1) |
3.36 |
3.01 |
11.52 |
|||||||||||
Net interest margin (1) |
3.57 |
3.31 |
7.72 |
|||||||||||
Efficiency (1) |
61.07 |
67.59 |
(9.64) |
|||||||||||
Average loans to average deposits |
84.74 |
91.75 |
(7.64) |
|||||||||||
Annualized net loan charge-offs/average loans |
1.12 |
0.63 |
78.08 |
|||||||||||
Effective income tax rate |
11.62 |
6.30 |
84.30 |
|||||||||||
Trust Assets, market value at period end |
$ 2,614,284 |
$ 2,368,578 |
10.37 |
|||||||||||
For the Quarter Ending |
||||||||||||
June 30, |
Mar. 31, |
Dec. 31, |
Sept. 30, |
June 30, |
||||||||
2010 |
2010 |
2009 |
2009 |
2009 |
||||||||
Return on average assets |
0.61 |
% |
0.59 |
% |
0.53 |
% |
0.38 |
% |
0.39 |
% |
||
Return on average equity |
5.47 |
5.36 |
4.85 |
3.35 |
3.48 |
|||||||
Return on average tangible equity (2) |
10.98 |
10.94 |
10.06 |
6.68 |
6.74 |
|||||||
Yield on earning assets (1) |
5.10 |
5.26 |
5.28 |
5.30 |
5.24 |
|||||||
Cost of interest bearing liabilities |
1.74 |
1.91 |
2.05 |
2.21 |
2.34 |
|||||||
Net interest spread (1) |
3.36 |
3.35 |
3.23 |
3.09 |
2.90 |
|||||||
Net interest margin (1) |
3.56 |
3.57 |
3.46 |
3.35 |
3.17 |
|||||||
Efficiency (1) |
60.36 |
61.78 |
63.09 |
61.89 |
68.71 |
|||||||
Average loans to average deposits |
83.37 |
86.16 |
87.22 |
87.21 |
84.80 |
|||||||
Annualized net loan charge-offs/average loans |
1.42 |
0.83 |
1.59 |
1.58 |
0.68 |
|||||||
Effective income tax rate |
13.20 |
9.91 |
(23.36) |
(7.15) |
0.03 |
|||||||
Trust Assets, market value at period end |
$ 2,614,284 |
$ 2,778,687 |
$ 2,668,610 |
$ 2,579,384 |
$ 2,368,578 |
|||||||
(1) 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. |
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(2) See non-GAAP financial measures for additional information relating to the calculation of this item. |
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WESBANCO, INC. |
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Consolidated Selected Financial Highlights |
Page 6 |
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(unaudited, dollars in thousands) |
% Change |
|||||||||||||
Balance sheets |
June 30, |
December 31, |
December 31, 2009 |
|||||||||||
Assets |
2010 |
2009 |
% Change |
2009 |
to June 30, 2010 |
|||||||||
Cash and due from banks |
$ 78,396 |
$ 79,662 |
(1.59) |
% |
$ 72,054 |
8.80 |
% |
|||||||
Due from banks - interest bearing |
41,954 |
12,235 |
242.90 |
10,813 |
288.00 |
|||||||||
Securities: |
||||||||||||||
Available-for-sale, at fair value |
839,952 |
1,505,884 |
(44.22) |
1,261,804 |
(33.43) |
|||||||||
Held-to-maturity (fair values of 435,754; 931 and 1,443, respectively) |
430,196 |
1,450 |
NM |
1,450 |
NM |
|||||||||
Total securities |
1,270,148 |
1,507,334 |
(15.74) |
1,263,254 |
0.55 |
|||||||||
Loans held for sale |
11,007 |
9,223 |
19.34 |
9,441 |
16.59 |
|||||||||
Portfolio Loans: |
||||||||||||||
Commercial |
447,875 |
472,915 |
(5.29) |
451,688 |
(0.84) |
|||||||||
Commercial real estate |
1,765,589 |
1,766,904 |
(0.07) |
1,780,221 |
(0.82) |
|||||||||
Residential real estate |
662,193 |
772,606 |
(14.29) |
708,397 |
(6.52) |
|||||||||
Home equity |
246,470 |
230,727 |
6.82 |
239,784 |
2.79 |
|||||||||
Consumer |
277,571 |
298,302 |
(6.95) |
290,856 |
(4.57) |
|||||||||
Total portfolio loans, net of unearned income |
3,399,698 |
3,541,454 |
(4.00) |
3,470,946 |
(2.05) |
|||||||||
Allowance for loan losses |
(65,203) |
(58,572) |
(11.32) |
(61,160) |
(6.61) |
|||||||||
Net portfolio loans |
3,334,495 |
3,482,882 |
(4.26) |
3,409,786 |
(2.21) |
|||||||||
Premises and equipment, net |
86,755 |
92,531 |
(6.24) |
89,603 |
(3.18) |
|||||||||
Accrued interest receivable |
19,786 |
21,796 |
(9.22) |
20,048 |
(1.31) |
|||||||||
Goodwill and other intangible assets, net |
286,908 |
289,893 |
(1.03) |
288,292 |
(0.48) |
|||||||||
Bank-owned life insurance |
105,176 |
102,973 |
2.14 |
103,637 |
1.48 |
|||||||||
Other assets |
121,636 |
138,412 |
(12.12) |
130,424 |
(6.74) |
|||||||||
Total Assets |
$ 5,356,261 |
$ 5,736,941 |
(6.64) |
% |
$ 5,397,352 |
(0.76) |
% |
|||||||
Liabilities |
||||||||||||||
Deposits: |
||||||||||||||
Non-interest bearing demand |
$ 547,551 |
$ 514,427 |
6.44 |
% |
$ 545,019 |
0.46 |
% |
|||||||
Interest bearing demand |
450,163 |
458,148 |
(1.74) |
450,697 |
(0.12) |
|||||||||
Money market |
839,743 |
661,705 |
26.91 |
714,926 |
17.46 |
|||||||||
Savings deposits |
513,062 |
484,236 |
5.95 |
486,055 |
5.56 |
|||||||||
Certificates of deposit |
1,763,288 |
1,982,007 |
(11.04) |
1,777,536 |
(0.80) |
|||||||||
Total deposits |
4,113,807 |
4,100,523 |
0.32 |
3,974,233 |
3.51 |
|||||||||
Federal Home Loan Bank borrowings |
309,642 |
580,544 |
(46.66) |
496,393 |
(37.62) |
|||||||||
Other short-term borrowings |
177,426 |
227,800 |
(22.11) |
188,522 |
(5.89) |
|||||||||
Junior subordinated debt owed to unconsolidated subsidiary trusts |
111,174 |
111,153 |
0.02 |
111,176 |
(0.00) |
|||||||||
Total borrowings |
598,242 |
919,497 |
(34.94) |
796,091 |
(24.85) |
|||||||||
Accrued interest payable |
6,886 |
13,148 |
(47.63) |
9,208 |
(25.21) |
|||||||||
Other liabilities |
32,612 |
50,053 |
(34.85) |
29,104 |
12.05 |
|||||||||
Total liabilities |
4,751,547 |
5,083,221 |
(6.52) |
4,808,636 |
(1.19) |
|||||||||
Shareholders' Equity |
||||||||||||||
Fixed Rate Cumulative Perpetual Preferred Stock, Series A, no par value; 1,000,000 shares authorized; 0 shares, 75,000 and 0 shares issued and outstanding, respectively |
- |
72,560 |
(100.00) |
- |
- |
|||||||||
Common stock, $2.0833 par value; 50,000,000 shares authorized; 26,633,848 shares issued; 26,586,903 shares, 26,567,653 shares and 26,567,653 shares outstanding, respectively |
55,487 |
55,487 |
- |
55,487 |
- |
|||||||||
Capital surplus |
191,817 |
193,196 |
(0.71) |
192,268 |
(0.23) |
|||||||||
Retained earnings |
349,497 |
338,610 |
3.22 |
340,788 |
2.56 |
|||||||||
Treasury stock (46,945; 66,195 and 66,195 shares - at cost, respectively) |
(1,064) |
(1,498) |
28.95 |
(1,498) |
28.95 |
|||||||||
Accumulated other comprehensive income |
10,155 |
(3,379) |
400.54 |
2,949 |
244.36 |
|||||||||
Deferred benefits for directors |
(1,178) |
(1,256) |
6.18 |
(1,278) |
7.79 |
|||||||||
Total Shareholders' Equity |
604,714 |
653,720 |
(7.50) |
588,716 |
2.72 |
|||||||||
Total Liabilities and Shareholders' Equity |
$ 5,356,261 |
$ 5,736,941 |
(6.64) |
% |
$ 5,397,352 |
(0.76) |
% |
|||||||
NM - Not Meaningful |
||||||||||||||
WESBANCO, INC. Consolidated Selected Financial Highlights (unaudited, dollars in thousands) |
|||||||||||||||||||||
Page 7 |
|||||||||||||||||||||
Average balance sheet and net interest margin analysis |
|||||||||||||||||||||
Three Months Ended June 30, |
Six Months Ended June 30, |
||||||||||||||||||||
2010 |
2009 |
2010 |
2009 |
||||||||||||||||||
Average |
Average |
Average |
Average |
Average |
Average |
Average |
Average |
||||||||||||||
Assets |
Balance |
Rate |
Balance |
Rate |
Balance |
Rate |
Balance |
Rate |
|||||||||||||
Due from banks - interest bearing |
$ 114,710 |
0.24% |
$ 56,111 |
0.32% |
$ 104,171 |
0.19% |
$ 46,063 |
0.20% |
|||||||||||||
Loans, net of unearned income (1) |
3,421,647 |
5.62% |
3,563,495 |
5.79% |
3,438,814 |
5.65% |
3,581,004 |
5.83% |
|||||||||||||
Securities: (2) |
|||||||||||||||||||||
Taxable |
969,547 |
3.60% |
1,215,980 |
3.55% |
944,079 |
3.78% |
936,302 |
3.91% |
|||||||||||||
Tax-exempt (3) |
267,250 |
6.57% |
343,499 |
6.63% |
273,308 |
6.58% |
335,929 |
6.61% |
|||||||||||||
Total securities |
1,236,797 |
4.24% |
1,559,479 |
4.23% |
1,217,387 |
4.41% |
1,272,231 |
4.62% |
|||||||||||||
Federal funds sold |
- |
0.00% |
- |
0.00% |
- |
- |
4,155 |
0.24% |
|||||||||||||
Other earning assets |
30,122 |
0.57% |
31,918 |
0.79% |
30,313 |
0.63% |
32,129 |
1.05% |
|||||||||||||
Total earning assets (3) |
4,803,276 |
5.10% |
5,211,003 |
5.24% |
4,790,685 |
5.18% |
4,935,582 |
5.43% |
|||||||||||||
Other assets |
633,734 |
637,759 |
635,053 |
618,840 |
|||||||||||||||||
Total Assets |
$ 5,437,010 |
$ 5,848,762 |
$ 5,425,738 |
$ 5,554,422 |
|||||||||||||||||
Liabilities and Shareholders' Equity |
|||||||||||||||||||||
Interest bearing demand deposits |
$ 471,500 |
0.54% |
$ 468,921 |
0.62% |
$ 465,357 |
0.57% |
$ 450,750 |
0.62% |
|||||||||||||
Money market accounts |
814,694 |
1.08% |
647,623 |
1.14% |
780,870 |
1.07% |
566,475 |
1.10% |
|||||||||||||
Savings deposits |
511,827 |
0.49% |
484,192 |
0.53% |
503,894 |
0.49% |
458,455 |
0.52% |
|||||||||||||
Certificates of deposit |
1,752,648 |
2.13% |
2,074,433 |
2.85% |
1,762,184 |
2.23% |
1,906,405 |
2.98% |
|||||||||||||
Total interest bearing deposits |
3,550,669 |
1.44% |
3,675,169 |
1.96% |
3,512,305 |
1.50% |
3,382,085 |
2.02% |
|||||||||||||
Federal Home Loan Bank borrowings |
406,387 |
3.52% |
584,381 |
3.85% |
438,975 |
3.63% |
588,788 |
3.85% |
|||||||||||||
Other borrowings |
174,199 |
2.70% |
232,467 |
3.05% |
180,193 |
2.63% |
235,253 |
3.29% |
|||||||||||||
Junior subordinated debt |
111,171 |
3.40% |
111,142 |
5.31% |
111,171 |
3.60% |
111,132 |
5.46% |
|||||||||||||
Total interest bearing liabilities |
4,242,426 |
1.74% |
4,603,159 |
2.34% |
4,242,644 |
1.82% |
4,317,258 |
2.42% |
|||||||||||||
Non-interest bearing demand deposits |
553,487 |
526,951 |
545,812 |
520,995 |
|||||||||||||||||
Other liabilities |
36,763 |
56,490 |
36,087 |
52,956 |
|||||||||||||||||
Shareholders' equity |
604,334 |
662,162 |
601,195 |
663,213 |
|||||||||||||||||
Total Liabilities and Shareholders' Equity |
$ 5,437,010 |
$ 5,848,762 |
$ 5,425,738 |
$ 5,554,422 |
|||||||||||||||||
Taxable equivalent net interest spread |
3.36% |
2.90% |
3.36% |
3.01% |
|||||||||||||||||
Taxable equivalent net interest margin |
3.56% |
3.17% |
3.57% |
3.31% |
|||||||||||||||||
(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 not material. |
|||||||||||||||||||||
(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 8 |
||||||||||||
(unaudited, dollars in thousands, except per share amounts) |
|||||||||||||
Quarter Ended |
|||||||||||||
Statement of Income |
June 30, |
Mar. 31, |
Dec. 31, |
Sept. 30, |
June 30, |
||||||||
Interest income |
2010 |
2010 |
2009 |
2009 |
2009 |
||||||||
Loans, including fees |
$ 47,911 |
$ 48,375 |
$ 49,804 |
$ 50,970 |
$ 51,482 |
||||||||
Interest and dividends on securities: |
|||||||||||||
Taxable |
8,724 |
9,111 |
9,779 |
10,563 |
10,791 |
||||||||
Tax-exempt |
2,851 |
2,994 |
3,204 |
3,595 |
3,698 |
||||||||
Total interest and dividends on securities |
11,575 |
12,105 |
12,983 |
14,158 |
14,489 |
||||||||
Other interest income |
111 |
85 |
84 |
84 |
108 |
||||||||
Total interest and dividend income |
59,597 |
60,565 |
62,871 |
65,212 |
66,079 |
||||||||
Interest Expense |
|||||||||||||
Interest bearing demand deposits |
636 |
670 |
757 |
787 |
727 |
||||||||
Money market deposits |
2,185 |
1,943 |
1,834 |
1,758 |
1,848 |
||||||||
Savings deposits |
623 |
602 |
601 |
606 |
644 |
||||||||
Certificates of deposit |
9,322 |
10,160 |
11,606 |
13,062 |
14,755 |
||||||||
Total interest expense on deposits |
12,766 |
13,375 |
14,798 |
16,213 |
17,974 |
||||||||
Federal Home Loan Bank borrowings |
3,567 |
4,334 |
5,035 |
5,568 |
5,614 |
||||||||
Other short-term borrowings |
1,173 |
1,178 |
1,353 |
1,780 |
1,770 |
||||||||
Junior subordinated debt owed to unconsolidated subsidiary trusts |
943 |
1,045 |
1,120 |
1,222 |
1,470 |
||||||||
Total interest expense |
18,449 |
19,932 |
22,306 |
24,783 |
26,828 |
||||||||
Net interest income |
41,148 |
40,633 |
40,565 |
40,429 |
39,251 |
||||||||
Provision for credit losses |
11,675 |
11,500 |
14,353 |
16,200 |
10,269 |
||||||||
Net interest income after provision for credit losses |
29,473 |
29,133 |
26,212 |
24,229 |
28,982 |
||||||||
Non-interest income |
|||||||||||||
Trust fees |
3,636 |
4,058 |
3,597 |
3,508 |
3,288 |
||||||||
Service charges on deposits |
5,701 |
5,317 |
6,430 |
6,648 |
6,076 |
||||||||
Bank-owned life insurance |
966 |
944 |
963 |
1,873 |
897 |
||||||||
Net securities gains/(losses) |
898 |
1,405 |
2,113 |
1,329 |
2,462 |
||||||||
Net gains on sales of mortgage loans |
569 |
525 |
489 |
820 |
297 |
||||||||
Net gain (loss) on other real estate owned and other assets |
(1,315) |
(1,530) |
(350) |
29 |
(294) |
||||||||
Other income |
4,130 |
4,322 |
4,046 |
4,348 |
3,583 |
||||||||
Total non-interest income |
14,585 |
15,041 |
17,288 |
18,555 |
16,309 |
||||||||
Non-interest expense |
|||||||||||||
Salaries and wages |
13,362 |
13,214 |
13,314 |
13,920 |
13,998 |
||||||||
Employee benefits |
4,347 |
4,997 |
4,949 |
5,240 |
5,061 |
||||||||
Net occupancy |
2,540 |
3,060 |
2,593 |
2,572 |
2,361 |
||||||||
Equipment |
2,376 |
2,604 |
2,609 |
2,888 |
2,687 |
||||||||
Marketing |
1,155 |
630 |
1,132 |
1,486 |
1,720 |
||||||||
FDIC Insurance |
1,683 |
1,605 |
1,713 |
1,528 |
4,322 |
||||||||
Amortization of intangible assets |
685 |
699 |
795 |
806 |
812 |
||||||||
Restructuring and merger-related expenses |
7 |
200 |
1,192 |
2 |
192 |
||||||||
Other operating expenses |
8,412 |
8,385 |
9,288 |
9,263 |
8,392 |
||||||||
Total non-interest expense |
34,567 |
35,394 |
37,585 |
37,705 |
39,545 |
||||||||
Income before provision for income taxes |
9,491 |
8,780 |
5,915 |
5,079 |
5,746 |
||||||||
Provision for income taxes |
1,253 |
870 |
(1,382) |
(363) |
2 |
||||||||
Net income |
$ 8,238 |
$ 7,910 |
$ 7,297 |
$ 5,442 |
$ 5,744 |
||||||||
Preferred dividends |
- |
- |
- |
3,121 |
1,057 |
||||||||
Net Income available to common shareholders |
$ 8,238 |
$ 7,910 |
$ 7,297 |
$ 2,321 |
$ 4,687 |
||||||||
Taxable equivalent net interest income |
$ 42,683 |
$ 42,245 |
$ 42,291 |
$ 42,365 |
$ 41,242 |
||||||||
Per common share data |
|||||||||||||
Net income available per common share - basic |
$ 0.31 |
$ 0.30 |
$ 0.27 |
$ 0.09 |
$ 0.18 |
||||||||
Net income available per common share - diluted |
$ 0.31 |
$ 0.30 |
$ 0.27 |
$ 0.09 |
$ 0.18 |
||||||||
Dividends declared |
$ 0.14 |
$ 0.14 |
$ 0.14 |
$ 0.14 |
$ 0.28 |
||||||||
Book value (period end) |
$ 22.74 |
$ 22.45 |
$ 22.16 |
$ 22.30 |
$ 24.61 |
||||||||
Tangible book value (period end) (1) |
$ 11.95 |
$ 11.63 |
$ 11.31 |
$ 11.41 |
$ 13.69 |
||||||||
Tangible common book value (period end) (1) |
$ 11.95 |
$ 11.63 |
$ 11.31 |
$ 11.41 |
$ 10.96 |
||||||||
Average common shares outstanding - basic |
26,577,065 |
26,567,653 |
26,567,653 |
26,567,653 |
26,567,653 |
||||||||
Average common shares outstanding - diluted |
26,577,828 |
26,568,172 |
26,567,653 |
26,568,081 |
26,568,752 |
||||||||
Period end common shares outstanding |
26,586,903 |
26,567,653 |
26,567,653 |
26,567,653 |
26,567,653 |
||||||||
Period end preferred shares outstanding |
- |
- |
- |
- |
75,000 |
||||||||
Full time equivalent employees |
1,415 |
1,379 |
1,393 |
1,428 |
1,473 |
||||||||
(1) See non-GAAP financial measures for additional information relating to the calculation of this item. |
|||||||||||||
WESBANCO, INC. |
|||||||||||||
Consolidated Selected Financial Highlights |
Page 9 |
||||||||||||
(unaudited, dollars in thousands) |
|||||||||||||
Quarter Ended |
|||||||||||||
June 30, |
Mar. 31, |
Dec. 31, |
Sept. 30, |
June 30, |
|||||||||
Asset quality data |
2010 |
2010 |
2009 |
2009 |
2009 |
||||||||
Non-performing assets: |
|||||||||||||
Non-accrual loans |
$ 65,083 |
$ 68,439 |
$ 65,273 |
$ 67,355 |
$ 70,021 |
||||||||
Renegotiated loans |
29,472 |
29,188 |
14,988 |
15,013 |
11,586 |
||||||||
Total non-performing loans |
94,555 |
97,627 |
80,261 |
82,368 |
81,607 |
||||||||
Other real estate and repossessed assets |
6,068 |
7,758 |
8,691 |
8,665 |
2,892 |
||||||||
Total non-performing assets |
$ 100,623 |
$ 105,385 |
$ 88,952 |
$ 91,033 |
$ 84,499 |
||||||||
Loans past due 90 days or more and accruing |
4,826 |
5,202 |
5,275 |
7,769 |
10,163 |
||||||||
Total non-performing assets and loans past due |
|||||||||||||
90 days or more |
$ 105,449 |
$ 110,587 |
$ 94,227 |
$ 98,802 |
$ 94,662 |
||||||||
Loans past due 30-89 days |
$ 35,517 |
$ 24,784 |
$ 25,396 |
$ 24,833 |
$ 26,371 |
||||||||
Loans past due 90 days or more and |
|||||||||||||
accruing / total loans |
0.14 |
% |
0.15 |
% |
0.15 |
% |
0.22 |
% |
0.29 |
% |
|||
Non-performing loans/total loans |
2.78 |
2.84 |
2.31 |
2.35 |
2.30 |
||||||||
Non-performing loans and loans past due 90 |
|||||||||||||
days or more/total loans |
2.92 |
2.99 |
2.46 |
2.57 |
2.59 |
||||||||
Non-performing assets/total loans, other |
|||||||||||||
real estate and repossessed assets |
2.95 |
3.06 |
2.56 |
2.59 |
2.38 |
||||||||
Loans past due 30-89 days/total loans |
1.04 |
0.72 |
0.73 |
0.71 |
0.74 |
||||||||
Allowance for loan losses |
|||||||||||||
Allowance for loan losses |
$ 65,203 |
$ 65,625 |
$ 61,160 |
$ 60,755 |
$ 58,572 |
||||||||
Provision for loan losses |
11,675 |
11,500 |
14,395 |
16,200 |
10,400 |
||||||||
Net loan and deposit account overdraft charge-offs |
12,097 |
7,035 |
13,990 |
14,017 |
6,080 |
||||||||
Annualized net loan charge-offs /average loans |
1.42 |
% |
0.83 |
% |
1.59 |
% |
1.58 |
% |
0.68 |
% |
|||
Allowance for loan losses/total loans |
1.92 |
% |
1.91 |
% |
1.76 |
% |
1.74 |
% |
1.65 |
% |
|||
Allowance for loan losses/non-performing loans |
0.69 |
x |
0.67 |
x |
0.76 |
x |
0.74 |
x |
0.72 |
x |
|||
Allowance for loan losses/non-performing loans and |
|||||||||||||
loans past due 90 days or more |
0.66 |
x |
0.64 |
x |
0.72 |
x |
0.67 |
x |
0.64 |
x |
|||
Quarter Ended |
|||||||||||||
June 30, |
Mar. 31, |
Dec. 31, |
Sept. 30, |
June 30, |
|||||||||
2010 |
2010 |
2009 |
2009 |
2009 |
|||||||||
Capital ratios |
|||||||||||||
Tier I leverage capital |
8.13 |
% |
8.07 |
% |
7.86 |
% |
7.55 |
% |
8.61 |
% |
|||
Tier I risk-based capital |
11.61 |
11.42 |
11.12 |
10.95 |
12.18 |
||||||||
Total risk-based capital |
12.87 |
12.68 |
12.37 |
12.21 |
13.43 |
||||||||
Shareholders' equity to assets |
11.12 |
11.05 |
10.86 |
11.37 |
11.32 |
||||||||
Tangible equity to tangible assets (1) |
6.27 |
6.06 |
5.88 |
5.75 |
6.68 |
||||||||
Tangible common equity to tangible assets (1) |
6.27 |
6.06 |
5.88 |
5.75 |
5.35 |
||||||||
(1) See non-GAAP financial measures for additional information relating to the calculation of this item. |
|||||||||||||
NON-GAAP FINANCIAL MEASURES |
Page 10 |
|||||||||||||
The following non-GAAP financial measures used by WesBanco provide information useful to investors in understanding |
||||||||||||||
Three Months Ended |
Year to Date |
|||||||||||||
June 30, |
Mar. 31, |
Dec. 31, |
Sept. 30, |
June 30, |
June 30, |
|||||||||
(unaudited, dollars in thousands) |
2010 |
2010 |
2009 |
2009 |
2009 |
2010 |
2009 |
|||||||
Return on average tangible equity: |
||||||||||||||
Net income (annualized) |
$ 33,043 |
$ 32,081 |
$ 28,949 |
$ 21,591 |
$ 23,039 |
$ 32,565 |
$ 22,574 |
|||||||
Plus: amortization of intangibles (annualized) (1) |
1,787 |
1,842 |
2,050 |
2,079 |
2,116 |
1,814 |
1,978 |
|||||||
Net income before amortization of intangibles (annualized) |
34,830 |
33,923 |
30,999 |
23,670 |
25,155 |
34,379 |
24,552 |
|||||||
Average total shareholders' equity |
604,334 |
598,022 |
596,747 |
643,700 |
662,162 |
601,195 |
663,213 |
|||||||
Less: average goodwill and other intangibles |
(287,221) |
(287,908) |
(288,661) |
(289,470) |
(288,780) |
(287,562) |
(278,776) |
|||||||
Average tangible equity |
317,113 |
310,114 |
308,086 |
354,230 |
373,382 |
313,633 |
384,437 |
|||||||
Return on average tangible equity |
10.98% |
10.94% |
10.06% |
6.68% |
6.74% |
10.96% |
6.39% |
|||||||
Period End |
|||||||||||
June 30, |
Mar. 31, |
Dec. 31, |
Sept. 30, |
June 30, |
|||||||
2010 |
2010 |
2009 |
2009 |
2009 |
|||||||
Tangible book value: |
|||||||||||
Total shareholders' equity |
$ 604,714 |
$ 596,473 |
$ 588,716 |
$ 592,335 |
$ 653,720 |
||||||
Less: goodwill and other intangible assets |
(286,908) |
(287,593) |
(288,292) |
(289,087) |
(289,893) |
||||||
Tangible equity |
317,806 |
308,880 |
300,424 |
303,248 |
363,827 |
||||||
Common shares outstanding |
26,586,903 |
26,567,653 |
26,567,653 |
26,567,653 |
26,567,653 |
||||||
Tangible book value |
$ 11.95 |
$ 11.63 |
$ 11.31 |
$ 11.41 |
$ 13.69 |
||||||
Tangible equity to tangible assets: |
|||||||||||
Total shareholders' equity |
$ 604,714 |
$ 596,473 |
$ 588,716 |
$ 592,335 |
$ 653,720 |
||||||
Less: goodwill and other intangible assets |
(286,908) |
(287,593) |
(288,292) |
(289,087) |
(289,893) |
||||||
Tangible equity |
317,806 |
308,880 |
300,424 |
303,248 |
363,827 |
||||||
Total assets |
5,356,261 |
5,380,441 |
5,397,352 |
5,561,091 |
5,736,941 |
||||||
Less: goodwill and other intangible assets |
(286,908) |
(287,593) |
(288,292) |
(289,087) |
(289,893) |
||||||
Tangible assets |
5,069,353 |
5,092,848 |
5,109,060 |
5,272,004 |
5,447,048 |
||||||
Tangible equity to tangible assets |
6.27% |
6.06% |
5.88% |
5.75% |
6.68% |
||||||
Tangible common equity to tangible assets: |
|||||||||||
Total shareholders' equity |
$ 604,714 |
$ 596,473 |
$ 588,716 |
$ 592,335 |
$ 653,720 |
||||||
Less: goodwill and other intangible assets |
(286,908) |
(287,593) |
(288,292) |
(289,087) |
(289,893) |
||||||
Less: preferred shareholders' equity |
- |
- |
- |
- |
(72,560) |
||||||
Tangible common equity |
317,806 |
308,880 |
300,424 |
303,248 |
291,267 |
||||||
Total assets |
5,356,261 |
5,380,441 |
5,397,352 |
5,561,091 |
5,736,941 |
||||||
Less: goodwill and other intangible assets |
(286,908) |
(287,593) |
(288,292) |
(289,087) |
(289,893) |
||||||
Tangible assets |
5,069,353 |
5,092,848 |
5,109,060 |
5,272,004 |
5,447,048 |
||||||
Tangible common equity to tangible assets |
6.27% |
6.06% |
5.88% |
5.75% |
5.35% |
||||||
Tangible common book value: |
|||||||||||
Total shareholders' equity |
$ 604,714 |
$ 596,473 |
$ 588,716 |
$ 592,335 |
$ 653,720 |
||||||
Less: goodwill and other intangible assets |
(286,908) |
(287,593) |
(288,292) |
(289,087) |
(289,893) |
||||||
Less: preferred shareholders' equity |
- |
- |
- |
- |
(72,560) |
||||||
Tangible common equity |
317,806 |
308,880 |
300,424 |
303,248 |
291,267 |
||||||
Common shares outstanding |
26,586,903 |
26,567,653 |
26,567,653 |
26,567,653 |
26,567,653 |
||||||
Tangible common book value |
$ 11.95 |
$ 11.63 |
$ 11.31 |
$ 11.41 |
$ 10.96 |
||||||
(1) Tax effected at 35%. |
|||||||||||
SOURCE WesBanco, Inc.
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