WesBanco Announces Improved Third Quarter 2010 Results

Oct 25, 2010, 17:20 ET from WesBanco, Inc.

WHEELING, W.Va., Oct. 25 /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 third quarter and year-to-date periods ended September 30, 2010.

Net income available to common shareholders for the quarter ended September 30, 2010 was $9.2 million as compared to $2.3 million for the third quarter of 2009, representing an increase of 294%, while diluted earnings per common share were $0.34 for the third quarter of 2010, as compared to $0.09 per common share for the third quarter of 2009.  For the nine month period, net income available to common shareholders was $25.3 million or $0.95 per common share, while for the same period in 2009, net income available to common shareholders was $11.4 million or $0.43 per common share.  Net income available to common shareholders increased 122% in the first nine months of 2010 as compared to 2009.  

Mr. Limbert commented, "WesBanco has continued to improve profitability, despite the slow economic recovery.  Net income grew significantly in the first nine months of 2010, and the quarter ending September 30, 2010 is the fourth consecutive quarter of growth in net income on a linked-quarter basis.  The growth in net income was achieved through improving net interest income, improving revenues from the Trust, Securities and Mortgage business units and the significant benefits of repurchasing TARP preferred shares in the third quarter of 2009, combined with a lower provision for the quarter and continued successful cost control throughout the organization."

Net Interest Income

Net interest income increased $1.6 million or 3.9% in the third quarter and $6.0 million or 5.1% in the year-to-date period of 2010 as compared to the same periods in 2009 due to the Bank's ability to manage rates on its loan and deposit accounts.  Net interest income has now increased for six consecutive quarters.  The net interest margin was 3.61% in the third quarter of 2010 and 3.58% for the nine months ending September 30, 2010, an increase of 26 basis points in both periods as compared to the same periods in 2009.  The average rate on interest bearing liabilities decreased by 65 basis points in the third quarter and 61 basis points in the year-to-date period, while the rate on earning assets declined at a much slower pace of 32 basis points in the third quarter and 28 basis points in the first nine months.  Lower rates on maturing 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 $315.3 million or 39.3% in the third quarter of 2010 from the third 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.  Improvements in the mix of deposits accounts, with CD's dropping to 41.8% of total deposits and demand deposits increasing to 25.3% of total deposits, also contributed to the improved cost of funds.  The margin  also benefited from a 8.9% increase in average non-interest bearing deposit balances as a result of retail marketing campaigns and a focus on treasury management deposits from business customers.  Total borrowings excluding junior subordinated debt are down to 8.2% of total assets from 14.5% last year.

Provision and Allowance for Credit Losses

The provision for credit losses decreased $4.4 million in the third quarter and $1.1 million in the first nine months of 2010 compared to the same periods of 2009.  The provision in the current quarter was stable compared to each of the preceding quarters in 2010.

Net charge-offs increased $5.6 million in the third quarter compared to the second quarter of 2010 due to $10.5 million of charge-offs relating to the sale of $11.6 million of commercial real estate and $3.0 million of commercial loans at carrying value.  Previous reserves associated with these loans totaled $5.4 million.  Net charge-offs in the current quarter also include $1.5 million attributable to a foreclosure on a $2.9 million non-accrual commercial real estate loan.  The allowance for loan losses decreased $6.2 million compared to June 30, 2010 and $2.2 million compared to December 31, 2009 due primarily to the reduction of required reserves attributable to loans that were sold or otherwise charged down in the current quarter.  The allowance for loan losses was 1.78% of total loans at September 30, 2010 compared to 1.76% at December 31, 2009 and 1.74% at September 30, 2009.

Non-accrual loans decreased $11.7 million from year-end primarily as a result of the sale or foreclosure of loans in the current and prior quarters and other successful efforts to exit or reduce this category of loans.  However, total non-performing loans increased $8.8 million in the third quarter compared to December 31, 2009 due to a $20.5 million increase in renegotiated loans that continue to perform in accordance with their modified terms.  Loans past due 30 days or more and accruing interest decreased $9.4 million in the current quarter compared to June 30, 2010 and were also slightly down from year end.

Non-Interest Income and Non-Interest Expense

For the third quarter of 2010 non-interest income decreased $3.6 million and for the nine months ended September 30, 2010 it decreased $2.7 million as compared to the same period in 2009.  The quarterly decrease was principally due to a $1.8 million decline in service charges on deposits resulting from changes in overdraft fee structures mandated by recent regulatory changes, reduced income from bank owned life insurance due to a benefit claim recognized in the third quarter of 2009 and increased losses on other real estate owned.  The year-to-date decrease is due to decreases in service charges on deposits and $3.1 million in year-to-date write-downs in other real estate owned of a hotel property.  Improvements in non-interest income included trust fee growth of 12.9% in the first nine months of 2010 as compared to the first nine months of 2009 due to new business developed this year and improved market conditions.  In addition, revenue increased in most other major non-interest operating areas including electronic banking fees, securities brokerage revenue and mortgage banking.

Non-interest expenses decreased $2.0 million in the third quarter and $6.4 million year-to-date as compared to the same periods in 2009.  WesBanco significantly reduced expenses in most expense categories including salaries and wages, employee benefits, marketing and professional fees, somewhat offset by increases in foreclosure-related property expenses and occupancy expenses.  In addition, the year-to-date expense reduction includes a decrease in FDIC insurance of $2.1 million primarily due to a special assessment of $2.6 million in the second quarter of 2009, partially offset by premium increases due to higher deposit levels.

Financial Condition

Total assets decreased 3.6% from last September, while decreasing only 0.6% as compared to year end 2009.  Portfolio loans decreased 5.2% from last September, primarily due to continued strategic decreases in residential real estate loans, a focus on reasonable credit terms for borrowers and compressed demand for commercial and consumer loans as a result of the slow economic recovery.  Total deposits increased by 4.1%, primarily due to a 25.8% increase in money market deposits, which, combined with smaller increases in demand and savings deposits more than offset a 6.7% 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 $365.2 million or 45.4% as compared to September 30, 2009 and 35.8% as compared to December 31, 2009, funded by the increased deposits and the decreases in loans.  The planned deleveraging of the balance sheet, together with weak loan demand as a result of the prolonged recession, resulted in a reduction of total average earning assets by 4.9% in the third quarter and 3.6% for the nine month period as compared to 2009.

WesBanco continues to maintain strong regulatory capital ratios of 8.17% tier I leverage, 11.64% tier I risk-based capital, and 12.89% total risk-based capital, all of which improved in each of the last four consecutive quarters and are above the "well-capitalized" standards promulgated by bank regulators. Total tangible equity to tangible assets (non-GAAP measure) improved to 6.34% at September 30, 2010 from 6.27% at June 30, 2010 and from 5.88% at year end, primarily due to balance sheet management strategies and a 3.3% increase in shareholders' equity from December 31, 2009.  The increase in shareholders' equity was the result of improved operating 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 Forms 10-Q for the quarters ended March 31, and June 30, 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; 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.

Website: www.wesbanco.com

WESBANCO, INC.

Consolidated Selected Financial Highlights

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

For the Three Months Ended

For the Nine Months Ended

STATEMENT OF INCOME

September 30,

September 30,

Interest and dividend income

2010

2009

% Change

2010

2009

% Change

Loans, including fees

$      46,753

$      50,970

(8.27%)

$    143,038

$    154,513

(7.43%)

Interest and dividends on securities:

Taxable

8,957

10,563

(15.20%)

26,792

28,872

(7.20%)

Tax-exempt

2,763

3,595

(23.14%)

8,609

10,806

(20.33%)

Total interest and dividends on securities

11,720

14,158

(17.22%)

35,401

39,678

(10.78%)

Other interest income

103

84

22.62%

299

302

(0.99%)

         Total interest and dividend income

58,576

65,212

(10.18%)

178,738

194,493

(8.10%)

Interest Expense

Interest bearing demand deposits

650

787

(17.41%)

1,957

2,163

(9.52%)

Money market deposits

1,821

1,758

3.58%

5,949

4,853

22.58%

Savings deposits

533

606

(12.05%)

1,758

1,784

(1.46%)

Certificates of deposit

8,817

13,062

(32.50%)

28,299

41,221

(31.35%)

Total interest expense on deposits

11,821

16,213

(27.09%)

37,963

50,021

(24.11%)

Federal Home Loan Bank borrowings

2,576

5,568

(53.74%)

10,477

16,814

(37.69%)

Other short-term borrowings

1,207

1,780

(32.19%)

3,558

5,619

(36.68%)

Junior subordinated debt owed to unconsolidated subsidiary trusts

986

1,222

(19.31%)

2,974

4,232

(29.73%)

Total interest expense

16,590

24,783

(33.06%)

54,972

76,686

(28.32%)

Net interest income

41,986

40,429

3.85%

123,766

117,807

5.06%

Provision for credit losses

11,778

16,200

(27.30%)

34,953

36,019

(2.96%)

Net interest income after provision for credit losses

30,208

24,229

24.68%

88,813

81,788

8.59%

Non-interest income

Trust fees

3,765

3,508

7.33%

11,459

10,149

12.91%

Service charges on deposits

4,897

6,648

(26.34%)

15,914

17,941

(11.30%)

Electronic banking fees

2,230

1,953

14.18%

6,335

5,554

14.06%

Net securities brokerage revenue

1,217

1,310

(7.10%)

3,642

3,110

17.11%

Bank-owned life insurance

879

1,873

(53.07%)

2,789

3,661

(23.82%)

Net securities gains

981

1,329

(26.19%)

3,284

3,933

(16.50%)

Net gains on sales of mortgage loans

985

820

20.12%

2,079

1,606

29.45%

Net loss on other real estate owned and other assets

(654)

29

(2355.17%)

(3,499)

(397)

781.36%

Other income

676

1,085

(37.70%)

2,599

1,744

49.03%

Total non-interest income

14,976

18,555

(19.29%)

44,602

47,301

(5.71%)

Non-interest expense

Salaries and wages

13,749

13,920

(1.23%)

40,326

41,085

(1.85%)

Employee benefits

4,671

5,240

(10.86%)

14,016

15,008

(6.61%)

Net occupancy

2,534

2,572

(1.48%)

8,133

7,676

5.95%

Equipment

2,460

2,888

(14.82%)

7,440

8,117

(8.34%)

Marketing

1,223

1,486

(17.70%)

3,008

3,961

(24.06%)

FDIC Insurance

1,740

1,528

13.87%

5,028

7,104

(29.22%)

Amortization of intangible assets

676

806

(16.13%)

2,060

2,315

(11.02%)

Restructuring and merger-related expenses

(32)

2

(1700.00%)

175

623

(71.91%)

Other operating expenses  

8,660

9,263

(6.51%)

25,454

26,174

(2.75%)

Total non-interest expense

35,681

37,705

(5.37%)

105,640

112,063

(5.73%)

Income before provision for income taxes

9,503

5,079

87.10%

27,775

17,026

63.13%

Provision for income taxes

350

(363)

196.42%

2,473

390

534.10%

Net income

$        9,153

$        5,442

68.19%

$      25,302

$      16,636

52.09%

Preferred dividends and expenses associated with unamortized

discount and issuance costs

-

3,121

(100.00%)

-

5,233

(100.00%)

Net Income available to common shareholders

$        9,153

$        2,321

294.36%

$      25,302

$      11,403

121.89%

Taxable equivalent net interest income

$     43,474

$     42,365

2.62%

$   128,402

$   123,626

3.86%

Per common share data

Net income available per common share - basic

$          0.34

$          0.09

277.78%

$          0.95

$          0.43

120.93%

Net income available per common share - diluted

$          0.34

$          0.09

277.78%

$          0.95

$          0.43

120.93%

Dividends declared

$          0.14

$          0.14

0.00%

$          0.42

$          0.70

(40.00%)

Book value (period end)

$        22.88

$        22.30

2.60%

Tangible book value (period end) (1)

$        12.11

$        11.41

6.13%

Average common shares outstanding - basic

26,586,953

26,567,653

0.07%

26,577,302

26,565,621

0.04%

Average common shares outstanding - diluted

26,587,281

26,568,081

0.07%

26,577,827

26,567,174

0.04%

Period end common shares outstanding

26,586,953

26,567,653

0.07%

26,586,953

26,567,653

0.07%

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

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

Selected ratios

For the Nine Months Ended

September 30,

2010

2009

% Change

Return on average assets

0.62

%

0.40

%

56.75

%

Return on average equity

5.60

3.39

65.40

Return on average tangible equity (1)

11.25

6.48

73.61

Yield on earning assets (2)

5.11

5.39

(5.12)

Cost of interest bearing liabilities

1.74

2.35

(26.08)

Net interest spread (2)

3.38

3.03

11.44

Net interest margin (2)

3.58

3.32

7.83

Efficiency (2)

61.06

65.56

(6.86)

Average loans to average deposits

83.32

90.18

(7.61)

Annualized net loan charge-offs/average loans

1.44

0.95

51.82

Effective income tax rate

8.90

2.29

288.65

Trust Assets, market value at period end

$ 2,797,935

$ 2,579,384

8.47

For the Quarter Ending

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

2010

2010

2010

2009

2009

Return on average assets

0.67

%

0.61

%

0.59

%

0.53

%

0.38

%

Return on average equity

5.96

5.47

5.36

4.85

3.35

Return on average tangible equity (1)

11.80

10.98

10.94

10.06

6.68

Yield on earning assets (2)

4.98

5.10

5.26

5.28

5.30

Cost of interest bearing liabilities

1.56

1.74

1.91

2.05

2.21

Net interest spread (2)

3.42

3.36

3.35

3.23

3.09

Net interest margin (2)

3.61

3.56

3.57

3.46

3.35

Efficiency (2)

61.05

60.36

61.78

63.09

61.89

Average loans to average deposits

80.60

83.37

86.16

87.22

87.21

Annualized net loan charge-offs/average loans

2.09

1.42

0.83

1.59

1.58

Effective income tax rate

3.69

13.20

9.91

(23.36)

(7.15)

Trust Assets, market value at period end

$ 2,797,935

$ 2,614,284

$ 2,778,687

$ 2,668,610

$ 2,579,384

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

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

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

% Change

Balance sheets

September 30,

December 31,

December 31, 2009

Assets

2010

2009

% Change

2009

to September 30, 2010

Cash and due from banks

$      88,371

$      75,257

17.43

%

$      72,054

22.65

%

Due from banks - interest bearing

583

11,999

(95.14)

10,813

(94.61)

Securities:

Available-for-sale, at fair value

893,414

1,417,687

(36.98)

1,261,804

(29.20)

Held-to-maturity (fair values of 476,710; 931 and 1,443, respectively)

465,297

1,450

NM

1,450

NM

Total securities

1,358,711

1,419,137

(4.26)

1,263,254

7.56

Loans held for sale

13,132

6,860

91.43

9,441

39.10

Portfolio Loans:

Commercial

431,996

463,948

(6.89)

451,688

(4.36)

Commercial real estate

1,733,426

1,764,791

(1.78)

1,780,221

(2.63)

Residential real estate

635,934

739,151

(13.96)

708,397

(10.23)

Home equity

248,481

235,427

5.54

239,784

3.63

Consumer

268,265

298,305

(10.07)

290,856

(7.77)

Total portfolio loans, net of unearned income

3,318,102

3,501,622

(5.24)

3,470,946

(4.40)

Allowance for loan losses

(58,989)

(60,755)

2.91

(61,160)

3.55

Net portfolio loans

3,259,113

3,440,867

(5.28)

3,409,786

(4.42)

Premises and equipment, net

85,868

91,411

(6.06)

89,603

(4.17)

Accrued interest receivable

20,882

22,091

(5.47)

20,048

4.16

Goodwill and other intangible assets, net

286,228

289,087

(0.99)

288,292

(0.72)

Bank-owned life insurance

106,054

102,670

3.30

103,637

2.33

Other assets

143,681

101,712

41.26

130,424

10.16

Total Assets

$ 5,362,623

$ 5,561,091

(3.57)

%

$ 5,397,352

(0.64)

%

Liabilities

Deposits:

Non-interest bearing demand

$    562,770

$    514,726

9.33

%

$    545,019

3.26

%

Interest bearing demand

493,172

467,085

5.59

450,697

9.42

Money market

853,324

678,099

25.84

714,926

19.36

Savings deposits

520,074

479,342

8.50

486,055

7.00

Certificates of deposit

1,741,736

1,866,256

(6.67)

1,777,536

(2.01)

Total deposits

4,171,076

4,005,508

4.13

3,974,233

4.95

Federal Home Loan Bank borrowings

259,179

567,939

(54.36)

496,393

(47.79)

Other short-term borrowings

180,422

236,884

(23.84)

188,522

(4.30)

Junior subordinated debt owed to unconsolidated subsidiary trusts

106,027

111,175

(4.63)

111,176

(4.63)

Total borrowings

545,628

915,998

(40.43)

796,091

(31.46)

Accrued interest payable

6,888

10,664

(35.41)

9,208

(25.20)

Other liabilities

30,744

36,586

(15.97)

29,104

5.63

Total liabilities

4,754,336

4,968,756

(4.32)

4,808,636

(1.13)

Shareholders' Equity

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

none outstanding

-

-

-

-

-

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

26,633,848 shares issued; 26,586,953 shares, 26,567,653

shares and 26,567,653 shares outstanding, respectively

55,487

55,487

-

55,487

-

Capital surplus

191,902

193,211

(0.68)

192,268

(0.19)

Retained earnings

354,925

337,211

5.25

340,788

4.15

Treasury stock (46,895; 66,195 and 66,195 shares - at cost,

respectively)

(1,063)

(1,498)

29.02

(1,498)

29.02

Accumulated other comprehensive income

8,221

9,195

10.59

2,949

178.77

Deferred benefits for directors

(1,185)

(1,271)

6.73

(1,278)

7.24

Total Shareholders' Equity

608,287

592,335

2.69

588,716

3.32

Total Liabilities and Shareholders' Equity

$ 5,362,623

$ 5,561,091

(3.57)

%

$ 5,397,352

(0.64)

%

NM - Not Meaningful

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

Average balance sheet and

net interest margin analysis

Three Months Ended September 30,

Nine Months Ended September 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

$      79,613

0.32%

$      38,772

0.19%

$      95,895

0.23%

$      43,606

0.19%

Loans, net of unearned income (1)

3,367,628

5.51%

3,529,534

5.73%

3,414,824

5.60%

3,563,632

5.80%

Securities: (2)

   Taxable

1,054,588

3.40%

1,100,345

3.84%

981,320

3.64%

991,584

3.88%

   Tax-exempt (3)

260,944

6.52%

337,130

6.56%

269,142

6.56%

336,334

6.59%

       Total securities

1,315,532

4.02%

1,437,475

4.48%

1,250,462

4.27%

1,327,918

4.57%

Federal funds sold

-

0.00%

-

0.00%

-

-

2,755

0.24%

Other earning assets

29,743

0.54%

31,911

0.83%

30,121

0.60%

32,055

0.97%

        Total earning assets (3)

4,792,516

4.98%

5,037,692

5.30%

4,791,302

5.11%

4,969,966

5.39%

Other assets

629,665

624,389

633,237

620,730

Total Assets

$ 5,422,181

$ 5,662,081

$ 5,424,539

$ 5,590,696

Liabilities and Shareholders' Equity

Interest bearing demand deposits

$    474,897

0.54%

$    456,939

0.68%

$    468,571

0.56%

$    452,836

0.64%

Money market accounts

851,910

0.85%

680,008

1.03%

804,810

0.99%

604,735

1.07%

Savings deposits

518,272

0.41%

483,273

0.50%

508,740

0.46%

466,819

0.51%

Certificates of deposit

1,765,540

1.98%

1,905,645

2.72%

1,763,315

2.15%

1,906,149

2.89%

   Total interest bearing deposits

3,610,619

1.30%

3,525,865

1.82%

3,545,436

1.43%

3,430,539

1.95%

Federal Home Loan Bank borrowings

303,377

3.37%

574,097

3.85%

393,279

3.56%

583,837

3.85%

Other borrowings

183,895

2.60%

228,514

3.09%

181,441

2.62%

232,982

3.22%

Junior subordinated debt

109,889

3.56%

111,164

4.36%

110,739

3.59%

111,143

5.09%

     Total interest bearing liabilities

4,207,780

1.56%

4,439,640

2.21%

4,230,895

1.74%

4,358,501

2.35%

Non-interest bearing demand deposits

567,645

521,477

553,170

521,157

Other liabilities

37,824

57,260

36,672

54,405

Shareholders' equity

608,932

643,704

603,802

656,633

Total Liabilities and Shareholders' Equity

$ 5,422,181

$ 5,662,081

$ 5,424,539

$ 5,590,696

Taxable equivalent net interest spread

3.42%

3.09%

3.38%

3.03%

Taxable equivalent net interest margin

3.61%

3.35%

3.58%

3.32%

(1) Gross of allowance for loan losses and net of unearned income.  Includes non-accrual and loans held for sale.

Loan fees included in interest income on loans are $0.9 million and $3.1 million for the three and nine months ended September 30, 2010, respectively, and $0.9 million and $3.7 million for the same periods in 2009.

(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

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

Quarter Ended

Statement of Income

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Interest income

2010

2010

2010

2009

2009

Loans, including fees

$ 46,753

$      47,911

$      48,375

$      49,804

$      50,970

Interest and dividends on securities:

Taxable

8,957

8,724

9,111

9,779

10,563

Tax-exempt

2,763

2,851

2,994

3,204

3,595

Total interest and dividends on securities

11,720

11,575

12,105

12,983

14,158

Other interest income

103

111

85

84

84

         Total interest and dividend income

58,576

59,597

60,565

62,871

65,212

Interest Expense

Interest bearing demand deposits

650

636

670

757

787

Money market deposits

1,821

2,185

1,943

1,834

1,758

Savings deposits

533

623

602

601

606

Certificates of deposit

8,817

9,322

10,160

11,606

13,062

Total interest expense on deposits

11,821

12,766

13,375

14,798

16,213

Federal Home Loan Bank borrowings

2,576

3,567

4,334

5,035

5,568

Other short-term borrowings

1,207

1,173

1,178

1,353

1,780

Junior subordinated debt owed to unconsolidated subsidiary trusts

986

943

1,045

1,120

1,222

Total interest expense

16,590

18,449

19,932

22,306

24,783

Net interest income

41,986

41,148

40,633

40,565

40,429

Provision for credit losses

11,778

11,675

11,500

14,353

16,200

Net interest income after provision for credit losses

30,208

29,473

29,133

26,212

24,229

Non-interest income

Trust fees

3,765

3,636

4,058

3,597

3,508

Service charges on deposits

4,897

5,701

5,317

6,430

6,648

Electronic banking fees

2,230

2,190

1,915

1,868

1,953

Net securities brokerage revenue

1,217

1,055

1,370

1,059

1,310

Bank-owned life insurance

879

966

944

963

1,873

Net securities gains/(losses)

981

898

1,405

2,113

1,329

Net gains on sales of mortgage loans

985

569

525

489

820

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

(654)

(1,315)

(1,530)

(350)

29

Other income

676

885

1,037

1,119

1,085

Total non-interest income

14,976

14,585

15,041

17,288

18,555

Non-interest expense

Salaries and wages

13,749

13,362

13,214

13,314

13,920

Employee benefits

4,671

4,347

4,997

4,949

5,240

Net occupancy

2,534

2,540

3,060

2,593

2,572

Equipment

2,460

2,376

2,604

2,609

2,888

Marketing

1,223

1,155

630

1,132

1,486

FDIC Insurance

1,740

1,683

1,605

1,713

1,528

Amortization of intangible assets

676

685

699

795

806

Restructuring and merger-related expenses

(32)

7

200

1,192

2

Other operating expenses  

8,660

8,412

8,385

9,288

9,263

Total non-interest expense

35,681

34,567

35,394

37,585

37,705

Income before provision for income taxes

9,503

9,491

8,780

5,915

5,079

Provision for income taxes

350

1,253

870

(1,382)

(363)

Net income

$           9,153

$        8,238

$        7,910

$        7,297

$        5,442

Preferred dividends

-

-

-

-

3,121

Net Income available to common shareholders

$           9,153

$        8,238

$        7,910

$        7,297

$        2,321

Taxable equivalent net interest income

$        43,474

$     42,683

$     42,245

$     42,291

$     42,365

Per common share data

Net income available per common share - basic

$             0.34

$          0.31

$          0.30

$          0.27

$          0.09

Net income available per common share - diluted

$             0.34

$          0.31

$          0.30

$          0.27

$          0.09

Dividends declared

$             0.14

$          0.14

$          0.14

$          0.14

$          0.14

Book value (period end)

$           22.88

$        22.74

$        22.45

$        22.16

$        22.30

Tangible book value (period end) (1)

$           12.11

$        11.95

$        11.63

$        11.31

$        11.41

Average common shares outstanding - basic

26,586,953

26,577,065

26,567,653

26,567,653

26,567,653

Average common shares outstanding - diluted

26,587,281

26,577,828

26,568,172

26,567,653

26,568,081

Period end common shares outstanding

26,586,953

26,586,903

26,567,653

26,567,653

26,567,653

Full time equivalent employees

1,371

1,415

1,379

1,393

1,428

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

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

Quarter Ended

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Asset quality data

2010

2010

2010

2009

2009

Non-performing assets:

Non-accrual loans

$   53,578

$   65,083

$   68,439

$ 65,273

$  67,355

Renegotiated loans

35,532

29,472

29,188

14,988

15,013

Total non-performing loans

89,110

94,555

97,627

80,261

82,368

Other real estate and repossessed assets

8,577

6,068

7,758

8,691

8,665

Total non-performing assets

$   97,687

$ 100,623

$ 105,385

$ 88,952

$  91,033

Loans past due 90 days or more and accruing

7,316

4,826

5,202

5,275

7,769

Total non-performing assets and loans past due

  90 days or more

$ 105,003

$ 105,449

$ 110,587

$ 94,227

$  98,802

Loans past due 30-89 days

$   23,661

$   35,517

$   24,784

$ 25,396

$  24,833

Loans past due 90 days or more and

accruing / total loans

0.22

%

0.14

%

0.15

%

0.15

%

0.22

%

Non-performing loans/total loans

2.69

2.78

2.84

2.31

2.35

Non-performing loans and loans past due 90

days or more/total loans

2.91

2.92

2.99

2.46

2.57

Non-performing assets/total loans, other

real estate and repossessed assets

2.94

2.95

3.06

2.56

2.59

Loans past due 30-89 days/total loans

0.71

1.04

0.72

0.73

0.71

Allowance for loan losses

Allowance for loan losses

$   58,989

$   65,203

$   65,625

$ 61,160

$  60,755

Provision for loan losses

11,491

11,675

11,500

14,395

16,200

Net loan and deposit account overdraft charge-offs

17,705

12,097

7,035

13,990

14,017

Annualized net loan charge-offs /average loans

2.09

%

1.42

%

0.83

%

1.59

%

1.58

%

Allowance for loan losses/total loans

1.78

%

1.92

%

1.91

%

1.76

%

1.74

%

Allowance for loan losses/non-performing loans

0.66

x

0.69

x

0.67

x

0.76

x

0.74

x

Allowance for loan losses/non-performing loans and

loans past due 90 days or more

0.61

x

0.66

x

0.64

x

0.72

x

0.67

x

Quarter Ended

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

2010

2010

2010

2009

2009

Capital ratios

Tier I leverage capital

8.17

%

8.13

%

8.07

%

7.86

%

7.55

%

Tier I risk-based capital

11.64

11.61

11.42

11.12

10.95

Total risk-based capital

12.89

12.87

12.68

12.37

12.21

Shareholders' equity to assets

11.23

11.12

11.05

10.86

11.37

Tangible equity to tangible assets (1)

6.34

6.27

6.06

5.88

5.75

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

NON-GAAP FINANCIAL MEASURES

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

Three Months Ended

Year to Date

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Sept. 30,

(unaudited, dollars in thousands)

2010

2010

2010

2009

2009

2010

2009

Return on average tangible equity:

Net income (annualized)

$      36,313

$      33,043

$      32,081

$      28,949

$      21,591

$  33,828

$  22,242

Plus: amortization of intangibles (annualized) (1)

1,743

1,787

1,842

2,050

2,079

1,791

2,012

Net income before amortization of intangibles (annualized)

38,056

34,830

33,923

30,999

23,670

35,619

24,254

Average total shareholder's equity

608,932

604,334

598,022

596,747

643,700

603,802

656,633

Less: average goodwill and other intangibles

(286,537)

(287,221)

(287,908)

(288,661)

(289,470)

(287,217)

(282,380)

Average tangible equity

322,395

317,113

310,114

308,086

354,230

316,585

374,253

Return on average tangible equity

11.80%

10.98%

10.94%

10.06%

6.68%

11.25%

6.48%

Period End

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

2010

2010

2010

2009

2009

Tangible book value:

Total shareholders' equity

$    608,287

$    604,714

$    596,473

$    588,716

$    592,335

Less:  goodwill and other intangible assets

(286,228)

(286,908)

(287,593)

(288,292)

(289,087)

Tangible equity

322,059

317,806

308,880

300,424

303,248

Common shares outstanding

26,586,953

26,586,903

26,567,653

26,567,653

26,567,653

Tangible book value

$        12.11

$        11.95

$        11.63

$        11.31

$        11.41

Tangible equity to tangible assets:

Total shareholders' equity

$    608,287

$    604,714

$    596,473

$    588,716

$    592,335

Less:  goodwill and other intangible assets

(286,228)

(286,908)

(287,593)

(288,292)

(289,087)

Tangible equity

322,059

317,806

308,880

300,424

303,248

Total assets

5,362,623

5,356,261

5,380,441

5,397,352

5,561,091

Less:  goodwill and other intangible assets

(286,228)

(286,908)

(287,593)

(288,292)

(289,087)

Tangible assets

5,076,395

5,069,353

5,092,848

5,109,060

5,272,004

Tangible equity to tangible assets

6.34%

6.27%

6.06%

5.88%

5.75%

(1) Tax effected at 35%.

SOURCE WesBanco, Inc.



RELATED LINKS

http://www.wesbanco.com