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TrustCo Announces Third Quarter Pretax Earnings Up 10%

Stocks in this article: TRST

Net interest margin for the third quarter of 2012 was 3.21%, up from 3.16% in the second quarter of 2012 and down from 3.38% in the third quarter of 2011. The improvement in the margin is partly due to the decision to restrain overall deposit growth through pricing discipline while improving the deposit mix during the third quarter.

At September 30, 2012 the tangible equity ratio was 8.27% compared to 8.04% at September 30, 2011. Tangible book value per share ended the third quarter at $3.81 compared to $3.62 in the year-ago period.

TrustCo Bank Corp NY is a $4.3 billion savings and loan holding company and through its subsidiary, Trustco Bank, operated 138 offices in New York, New Jersey, Vermont, Massachusetts, and Florida at September 30, 2012.

In addition, the Bank's Financial Services Department offers a full range of investment services, retirement planning and trust and estate administration services. The common shares of TrustCo are traded on the NASDAQ Global Select Market under the symbol TRST.

A conference call to discuss third quarter 2012 results will be held at 9:00 a.m. Eastern Time on October 23, 2012. Those wishing to participate in the call may dial toll-free 1-877-317-6789. International callers must dial + 1-412-317-6789.  A replay of the call will be available until January 24, 2013 by dialing 1-877-344-7529 ( 1-412-317-0088 for international callers), Conference Number 10019368. The call will also be audio webcast at: http://services.choruscall.com/links/trst121023.html , and will be available until October 23, 2013. 

Safe Harbor Statement

All statements in this news release that are not historical are forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended. The "forward-looking statements" may include statements regarding future events or performance and statements regarding TrustCo's ability to offer and sell securities under its shelf registration statement. Such forward-looking statements are subject to factors that could cause actual results to differ materially for TrustCo from those discussed. TrustCo wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect our actual results and could cause our actual financial performance to differ materially from that expressed in any forward-looking statement: credit risk, the effects of and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System, inflation, interest rates, market and monetary fluctuations, competition, the effect of changes in financial services laws and regulations (including laws concerning taxation, banking and securities), real estate and collateral values, changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board ("FASB") or the Public Company Accounting Oversight Board; changes in local market areas and general business and economic trends and the matters described under the heading "Risk Factors" in our annual report on Form 10-K for the year ended December 31, 2011, as amended, and in our subsequent securities filings.

TRUSTCO BANK CORP NY
GLENVILLE, NY
       
FINANCIAL HIGHLIGHTS
       
(dollars in thousands, except per share data)
(Unaudited)
  Three Months Ended
  09/30/12 06/30/12 09/30/11
Summary of operations    
 Net interest income (TE)  $ 34,321  33,993  34,390
 Provision for loan losses  2,900  3,000  5,100
 Net securities transactions  666  55  158
 Noninterest income  3,927  3,971  3,645
 Noninterest expense  20,019  20,498  18,443
 Net income  9,753  9,066  9,225
       
Per common share    
 Net income per share:    
 - Basic  $ 0.104  0.097  0.100
 - Diluted  $ 0.104  0.097  0.100
 Cash dividends  0.066  0.066  0.066
 Tangible Book value at period end  3.81  3.73  3.62
 Market price at period end  5.71  5.46  4.46
       
At period end    
 Full time equivalent employees 760 742 720
 Full service banking offices 138 137 135
       
Performance ratios    
 Return on average assets 0.89% 0.83 0.88
 Return on average equity 10.97 10.49 10.91
 Efficiency (1) 49.18 52.24 46.51
 Net interest spread (TE) 3.15 3.09 3.29
 Net interest margin (TE) 3.21 3.16 3.38
 Dividend payout ratio 63.13 67.80 66.27
       
Capital ratio at period end    
 Consolidated tangible equity to tangible assets (2) 8.27 7.90 8.04
       
Asset quality analysis at period end  
 Nonperforming loans to total loans (4) 1.92 2.01 1.89
 Nonperforming assets to total assets (4) 1.36 1.25 1.27
 Allowance for loan losses to total loans 1.82 1.88 1.93
 Coverage ratio (3) 0.9x 0.9 1.0
       
       
(1) Calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income (excluding net securities transactions).
(2) The tangible equity ratio excludes $553,000 of intangibles from both equity and assets.
(3) Calculated as allowance for loan losses divided by total nonperforming loans.
(4) Included in the September 30, 2012 balance of nonperforming loans is net $4.0 of performing loans that have been reclassified to nonaccrual status as a result of recent OCC guidance.
       
TE = Taxable equivalent.
 
FINANCIAL HIGHLIGHTS, Continued
     
(dollars in thousands, except per share data)
(Unaudited)
  Nine Months Ended
  09/30/12 09/30/11
Summary of operations    
 Net interest income (TE)  $ 101,951  101,497
 Provision for loan losses  9,000  14,550
 Net securities transactions  1,398  1,296
 Noninterest income  11,739  11,349
 Noninterest expense  61,161  60,841
 Net income  27,728  24,373
     
Per common share    
 Net income per share:    
 - Basic  $ 0.296  0.296
 - Diluted  0.296  0.296
 Cash dividends  0.197  0.197
 Tangible Book value at period end  3.81  3.62
 Market price at period end  5.71  4.46
     
Performance ratios    
 Return on average assets 0.85% 0.80
 Return on average equity 10.64 11.38
 Efficiency (1) 51.30 49.98
 Net interest spread (TE) 3.12 3.33
 Net interest margin (TE) 3.20 3.42
 Dividend payout ratio 66.51 66.71
     
     
(1) Calculated as noninterest expense (excluding ORE income/expense) divided by taxable equivalent net interest income plus noninterest income (excluding net securities transactions).
     
TE = Taxable equivalent.
 
CONSOLIDATED STATEMENTS OF INCOME
           
(dollars in thousands, except per share data)
(Unaudited)
  Three Months Ended
  9/30/2012 6/30/2012 3/31/2012 12/31/2011 9/30/2011
Interest and dividend income:           
Interest and fees on loans  $ 32,103  32,277  32,425  32,711  32,640
Interest and dividends on securities available for sale:           
 U. S. government sponsored enterprises  1,996  2,606  2,304  2,661  3,347
 State and political subdivisions   340  368  410  490  557
 Mortgage-backed securities and collateralized mortgage obligations-residential  2,003  1,364  1,093  1,083  778
 Corporate bonds  529  648  822  886  953
 Small Business Administration-guaranteed participation securities  43  --  --  --  --
 Other securities  4  5  5  5  5
 Total interest and dividends on securities available for sale  4,915  4,991  4,634  5,125  5,640
           
Interest on held to maturity securities:           
 U. S. government sponsored enterprises  --  --  25  97  164
 Mortgage-backed securities and collateralized mortgage obligations-residential  976  1,198  1,290  1,151  1,186
 Corporate bonds  385  387  509  590  565
 Total interest on held to maturity securities  1,361  1,585  1,824  1,838  1,915
           
 Federal Reserve Bank and Federal Home Loan Bank stock  120  149  90  80  84
           
Interest on federal funds sold and other short-term investments  258  299  320  284  318
 Total interest income  38,757  39,301  39,293  40,038  40,597
           
Interest expense:           
 Interest on deposits:           
 Interest-bearing checking  79  78  78  76  74
 Savings  870  979  1,102  1,018  952
 Money market deposit accounts  673  770  923  1,030  1,158
 Time deposits  2,629  3,230  3,418  3,552  3,904
 Interest on short-term borrowings  348  378  388  401  384
 Total interest expense  4,599  5,435  5,909  6,077  6,472
           
 Net interest income  34,158  33,866  33,384  33,961  34,125
           
Provision for loan losses  2,900  3,000  3,100  4,200  5,100
Net interest income after provision for loan losses   31,258  30,866  30,284  29,761  29,025
           
Noninterest income:          
 Trust department income  1,145  1,407  1,394  1,086  1,242
 Fees for services to customers  2,610  2,388  2,240  2,305  2,189
 Net gain on securities transactions  666  55  677  132  158
 Other  172  176  207  213  214
 Total noninterest income  4,593  4,026  4,518  3,736  3,803
           
Noninterest expenses:           
 Salaries and employee benefits  7,587  7,519  7,743  7,638  7,087
 Net occupancy expense  3,756  3,817  3,795  3,664  3,614
 Equipment expense  1,316  1,600  1,520  1,200  1,639
 Professional services  1,657  1,489  1,436  1,411  1,152
 Outsourced services  1,350  1,347  1,250  1,050  1,350
 Advertising expense  935  1,060  809  607  763
 FDIC and other insurance  983  953  880  577  835
 Other real estate expense, net  1,210  665  966  1,254  754
 Other  1,225  2,048  2,245  1,508  1,249
 Total noninterest expenses  20,019  20,498  20,644  18,909  18,443
           
Income before taxes  15,832  14,394  14,158  14,588  14,385
Income taxes  6,079  5,328  5,249  5,874  5,160
           
Net income  $ 9,753  9,066  8,909  8,714  9,225
Net income per Common Share:           
 - Basic  $ 0.104 0.097 0.095 0.093 0.100
 - Diluted 0.104 0.097 0.095 0.093 0.100
           
Average basic shares (thousands)  93,692  93,561  93,546  93,308  92,124
Average diluted shares (thousands)  93,700  93,562  93,546  93,308  92,124
           
Note: Taxable equivalent net interest income  $ 34,321  33,993  33,637  34,220  34,390
 
 
CONSOLIDATED STATEMENTS OF INCOME
     
(dollars in thousands, except per share data)
(Unaudited)
  Nine Months Ended
  9/30/2012 9/30/2011
     
Interest and dividend income:     
Interest and fees on loans  $ 96,805  96,501
Interest and dividends on securities available for sale:     
 U. S. government sponsored enterprises  6,906  10,337
 State and political subdivisions   1,118  1,981
 Mortgage-backed securities and collateralized mortgage obligations-residential  4,460  2,008
 Corporate bonds  1,999  3,173
 Small Business Administration-guaranteed participation securities  43  --
 Other securities  14  14
 Total interest and dividends on securities available for sale  14,540  17,513
     
Interest on held to maturity securities:     
 U. S. government sponsored enterprises  25  164
 Mortgage-backed securities-residential  3,464  3,614
 Corporate bonds  1,281  1,875
 Total interest on held to maturity securities  4,770  5,653
     
 Federal Reserve Bank and Federal Home Loan Bank stock  359  225
     
Interest on federal funds sold and other short-term investments  877  818
 Total interest income  117,351  120,710
     
Interest expense:     
 Interest on deposits:     
 Interest-bearing checking  235  209
 Savings  2,951  2,770
 Money market deposit accounts  2,366  3,569
 Time deposits  9,277  12,446
 Interest on short-term borrowings  1,114  1,173
 Total interest expense  15,943  20,167
     
 Net interest income  101,408  100,543
     
Provision for loan losses  9,000  14,550
Net interest income after provision for loan losses   92,408  85,993
     
Noninterest income:    
 Trust department income  3,946  4,002
 Fees for services to customers  7,238  6,608
 Net gain on securities transactions  1,398  1,296
 Other  555  739
 Total noninterest income  13,137  12,645
     
Noninterest expenses:     
 Salaries and employee benefits  22,849  21,113
 Net occupancy expense  11,368  11,023
 Equipment expense  4,436  4,452
 Professional services  4,582  4,318
 Outsourced services  3,947  4,050
 Advertising expense  2,804  2,177
 FDIC and other insurance  2,816  4,078
 Other real estate expense, net  2,841  4,439
 Other  5,518  5,191
 Total noninterest expenses  61,161  60,841
     
Income before taxes  44,384  37,797
Income taxes  16,656  13,424
     
Net income  $ 27,728  24,373
     
Net income per Common Share:     
 - Basic  $ 0.296 0.296
 - Diluted 0.296 0.296
     
Average basic shares (thousands)  93,568  82,297
Average diluted shares (thousands)  93,572  82,297
     
Note: Taxable equivalent net interest income  $ 101,951  101,497
 
 
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
           
(dollars in thousands)
(Unaudited)
           
           
  9/30/2012 6/30/2012 3/31/2012 12/31/2011 9/30/2011
 ASSETS:          
           
 Cash and due from banks  $ 40,354 36,589 39,426 44,395 40,875
 Federal funds sold and other short term investments 402,290 486,049 486,055 488,548 434,950
 Total cash and cash equivalents 442,644 522,638 525,481 532,943 475,825
           
 Securities available for sale:          
 U. S. government sponsored enterprises 427,798 643,189 744,725 563,460 633,812
 States and political subdivisions 33,857 36,978 38,367 43,968 51,289
 Mortgage-backed securities and collateralized mortgage obligations-residential 515,879 354,285 219,301 204,022 200,516
 Corporate bonds 49,296 73,311 81,654 96,608 97,464
 Small Business Administration-guaranteed participation securities 25,338  --   --   --   -- 
 Other securities 660 660 660 660 660
 Total securities available for sale 1,052,828 1,108,423 1,084,707 908,718 983,741
           
 Held to maturity securities:          
 U. S. government sponsored enterprises  --   --   --  15,000  25,000
 Mortgage-backed securities and collateralized mortgage obligations-residential 120,877 133,562 143,629 141,857 109,603
 Corporate bonds 35,074 35,193 35,312 59,431 59,555
 Total held to maturity securities 155,951 168,755 178,941 216,288 194,158
           
 Federal Reserve Bank and Federal Home Loan Bank stock 9,632 9,632 9,004 9,004 6,861
           
 Loans:          
 Commercial 217,431 235,347 235,513 248,163 244,389
 Residential mortgage loans 2,056,972 2,003,046 1,970,278 1,955,951 1,925,144
 Home equity line of credit 327,083 317,157 314,668 313,038 305,587
 Installment loans 4,455 4,071 3,855 4,151 3,829
 Loans, net of deferred fees and costs 2,605,941 2,559,621 2,524,314 2,521,303 2,478,949
 Less:          
 Allowance for loan losses 47,364 48,018 48,535 48,717 47,782
 Net loans 2,558,577 2,511,603 2,475,779 2,472,586 2,431,167
           
 Bank premises and equipment, net 37,251 37,868 37,099 37,006 35,946
 Other assets 61,290 62,480 63,432 67,099 65,261
           
 Total assets  $ 4,318,173 4,421,399 4,374,443 4,243,644 4,192,959
           
 LIABILITIES:          
 Deposits:          
 Demand  $ 292,350 283,873 281,628 267,776 269,958
 Interest-bearing checking 536,892 528,101 507,510 489,227 472,908
 Savings accounts 1,167,927 1,122,208 1,068,058 978,819 923,893
 Money market deposit accounts 668,064 644,627 631,761 635,434 642,054
 Certificates of deposit (in denominations of $100,000 or more) 359,246 452,043 467,447 460,971 461,081
 Other time accounts 751,974 867,798 894,946 903,746 910,633
 Total deposits 3,776,453 3,898,650 3,851,350 3,735,973 3,680,527
           
 Short-term borrowings 161,751 150,718 159,002 147,563 143,081
 Due to broker  --   --   --   --   10,000
 Accrued expenses and other liabilities 22,352 22,124 19,445 21,592 21,541
           
 Total liabilities 3,960,556 4,071,492 4,029,797 3,905,128 3,855,149
           
 SHAREHOLDERS' EQUITY:          
 Capital stock 98,912 98,912 98,912 98,912 98,806
 Surplus 175,284 175,773 176,199 176,638 177,448
 Undivided profits 128,750 125,153 122,235 119,465 116,894
 Accumulated other comprehensive income (loss), net of tax 4,879 1,585 53 (2,493) 258
 Treasury stock at cost (50,208) (51,516) (52,753) (54,006) (55,596)
           
 Total shareholders' equity 357,617 349,907 344,646 338,516 337,810
           
 Total liabilities and shareholders' equity  $ 4,318,173 4,421,399 4,374,443 4,243,644 4,192,959
           
Outstanding shares (thousands)  93,807  93,674  93,549  93,315  93,154
 
 
NONPERFORMING ASSETS
           
(dollars in thousands)
(Unaudited)
           
Nonperforming Assets        
  09/30/12 06/30/12 03/31/12 12/31/11 09/30/11
New York and other states*        
Loans in nonaccrual status:        
 Commercial  $ 5,880  5,656  5,667  4,981  5,086
 Real estate mortgage - 1 to 4 family  32,593  29,167  29,894  27,820  25,932
 Installment  71  1  9  3  4
Total non-accrual loans  38,544  34,824  35,570  32,804  31,022
Other nonperforming real estate mortgages - 1 to 4 family  238  243  306  312  317
Total nonperforming loans  38,782  35,067  35,876  33,116  31,339
Other real estate owned  2,716  2,787  2,411  2,382  2,372
Total nonperforming assets  $ 41,498  37,854  38,287  35,498  33,711
           
Florida          
Loans in nonaccrual status:        
 Commercial  $ 2,698  8,435  5,874  5,000  5,400
 Real estate mortgage - 1 to 4 family  8,438  7,954  9,404  10,662  10,231
 Installment  7  1  --  --  --
Total non-accrual loans  11,143  16,390  15,278  15,662  15,631
Other nonperforming real estate mortgages - 1 to 4 family  --  --  --  --  --
Total nonperforming loans  11,143  16,390  15,278  15,662  15,631
Other real estate owned  5,975  1,083  1,293  2,883  3,739
Total nonperforming assets  $ 17,118  17,473  16,571  18,545  19,370
           
Total          
Loans in nonaccrual status:        
 Commercial  $ 8,578  14,091  11,541  9,981  10,486
 Real estate mortgage - 1 to 4 family  41,031  37,121  39,298  38,482  36,163
 Installment  78  2  9  3  4
Total non-accrual loans  49,687  51,214  50,848  48,466  46,653
Other nonperforming real estate mortgages - 1 to 4 family  238  243  306  312  317
Total nonperforming loans  49,925  51,457  51,154  48,778  46,970
Other real estate owned  8,691  3,870  3,704  5,265  6,111
Total nonperforming assets  $ 58,616  55,327  54,858  54,043  53,081
           
           
Quarterly Net Chargeoffs        
  09/30/12 06/30/12 03/31/12 12/31/11 09/30/11
New York and other states*        
Commercial  $ 9  713  321  99  (3)
Real estate mortgage - 1 to 4 family  2,157  1,844  1,136  1,404  858
Installment  7  7  (8)  5  17
 Total net chargeoffs  $ 2,173  2,564  1,449  1,508  872
           
Florida          
Commercial  $ 736  288  160  400  --
Real estate mortgage - 1 to 4 family  644  665  1,673  1,359  2,006
Installment  1  --  --  (2)  1
 Total net chargeoffs  $ 1,381  953  1,833  1,757  2,007
           
Total          
Commercial  $ 745  1,001  481  499  (3)
Real estate mortgage - 1 to 4 family  2,801  2,509  2,809  2,763  2,864
Installment  8  7  (8)  3  18
 Total net chargeoffs  $ 3,554  3,517  3,282  3,265  2,879
           
           
Asset Quality Ratios          
  09/30/12 06/30/12 03/31/12 12/31/11 09/30/11
Total nonperforming loans(1)  $ 49,925  51,457  51,154  48,778  46,970
Total nonperforming assets(1)  58,616  55,327  54,858  54,043  53,081
Total net chargeoffs(2)  3,554  3,517  3,282  3,265  2,879
           
Allowance for loan losses(1) 47,364 48,018 48,535 48,717 47,782
           
Nonperforming loans to total loans(1) 1.92% 2.01% 2.03% 1.93% 1.89%
Nonperforming assets to total assets(1) 1.36% 1.25% 1.25% 1.27% 1.27%
Allowance for loan losses to total loans(1) 1.82% 1.88% 1.92% 1.93% 1.93%
Coverage ratio(1) 94.9% 93.3% 94.9% 99.9% 101.7%
Annualized net chargeoffs to average loans(2) 0.55% 0.55% 0.52% 0.52% 0.47%
Allowance for loan losses to annualized net chargeoffs(2) 3.3x 3.4x 3.7x 3.7x 4.1x
           
* Includes New York, New Jersey, Vermont and Massachusetts.
(1) At period-end
(2) For the period ended
 
 
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY-
INTEREST RATES AND INTEREST DIFFERENTIAL
               
(dollars in thousands) (Unaudited) Three months ended September 30, 2012   Three months ended September 30, 2011
  Average Balance Interest   Average Rate   Average Balance Interest   Average Rate
               
               
Assets              
               
Securities available for sale:              
U. S. government sponsored enterprises  $ 594,814 1,996 1.34%    $ 666,503 3,347 2.01%
Mortgage backed securities and              
  collateralized mortgage obligations-residential 397,935 2,003 2.01   114,442 778 2.72
State and political subdivisions 34,383 495 5.76   53,540 815 6.09
Corporate bonds 66,940 529 3.16   102,522 953 3.72
Small Business Administration-guaranteed participation securities 8,024 43  2.14    --   --  0.00
Other 660 4  2.42   660 5  3.03
               
 Total securities available for sale 1,102,756 5,070 1.84   937,667 5,898 2.52
               
Federal funds sold and other              
 short-term Investments 416,971 258 0.25   486,749 318 0.26
               
Held to maturity securities:              
U. S. government sponsored enterprises  --   -- 0.00    27,772  164 2.36
Corporate bonds 35,132 385 4.39   50,962 565 4.44
Mortgage backed securities and              
  collateralized mortgage obligations-residential 128,188 976 3.04   111,037 1,186 4.27
               
 Total held to maturity securities 163,320 1,361 3.33   189,771 1,915 4.04
               
Federal Reserve Bank and Federal Home Loan Bank stock 9,632 120  4.98   6,861 84  4.90
               
Commercial loans 228,537 3,068 5.36   247,294 3,532 5.71
Residential mortgage loans 2,031,080 25,988 5.12   1,899,421 26,115 5.50
Home equity lines of credit 322,405 2,906 3.59   301,055 2,853 3.76
Installment loans 4,007 149 14.82   3,559 147 16.34
               
Loans, net of unearned income 2,586,029 32,111 4.96   2,451,329 32,647 5.32
               
 Total interest earning assets 4,278,708 38,920 3.64   4,072,377 40,862 4.01
               
Allowance for loan losses (49,039)       (46,731)    
Cash & non-interest earning assets 144,099       143,928    
               
               
Total assets  $ 4,373,768        $ 4,169,574    
               
               
Liabilities and shareholders' equity              
               
Deposits:              
Interest bearing checking accounts  $ 531,216 79 0.06%    $ 467,152 74 0.06%
Money market accounts 660,464 673 0.40   644,452 1,158 0.71%
Savings 1,151,910 870 0.30   913,384 952 0.41%
Time deposits 1,217,080 2,629 0.86   1,396,941 3,904 1.11%
               
 Total interest bearing deposits 3,560,670 4,251 0.48   3,421,929 6,088 0.71
Short-term borrowings 151,535 348 0.91   132,404 384 1.15
               
 Total interest bearing liabilities 3,712,205 4,599 0.49   3,554,333 6,472 0.72
               
Demand deposits 287,915       260,602    
Other liabilities 20,084       19,310    
Shareholders' equity 353,564       335,329    
               
Total liabilities and shareholders' equity  $ 4,373,768        $ 4,169,574    
               
Net interest income , tax equivalent   34,321       34,390  
               
Net interest spread     3.15%       3.29%
               
Net interest margin (net interest income            
to total interest earning assets)     3.21%       3.38%
               
Tax equivalent adjustment   (163)       (265)  
               
               
 Net interest income    34,158       34,125  
               
               
               
               
       
(dollars in thousands) (Unaudited) Nine months ended September 30, 2012   Nine months ended September 30, 2011
  Average Balance Interest   Average Rate   Average Balance Interest   Average Rate
               
Assets              
               
Securities available for sale:              
U. S. government sponsored enterprises  $ 634,903 6,906 1.45%    $ 691,975 10,337 1.99%
Mortgage backed securities and              
 collateralized mortgage obligations-residential 286,287 4,460 2.08   83,603 2,008 3.20
State and political subdivisions 37,032 1,587 5.71   62,440 2,913 6.22
Corporate bonds 78,999 1,999 3.38   110,438 3,173 3.83
Small Business Administration-guaranteed participation securities 2,694 43  2.13    --   --  0.00
Other 660 14  2.83   717 14  2.60
               
 Total securities available for sale 1,040,575 15,009 1.92   949,173 18,445 2.59
               
Federal funds sold and other              
 short-term Investments 473,196 877 0.25   429,115 818 0.25
               
Held to maturity securities:              
U. S. government sponsored enterprises  1,423  25 2.38    9,359  164 2.33
Corporate bonds 41,071 1,281 4.16   55,125 1,875 4.54
Mortgage backed securities and              
 collateralized mortgage obligations-residential 136,554 3,464 3.38   112,472 3,614 4.28
               
 Total held to maturity securities 179,048 4,770 3.55   176,956 5,653 4.26
               
Federal Reserve Bank and Federal Home Loan Bank stock 9,357 359  5.12   6,879 225  4.36
               
Commercial loans 235,128 9,569 5.43   250,346 10,884 5.80
Residential mortgage loans 1,994,051 78,224 5.23   1,849,192 76,950 5.55
Home equity lines of credit 317,914 8,646 3.63   295,338 8,247 3.73
Installment loans 3,795 440 15.50   3,650 442 16.19
               
Loans, net of unearned income 2,550,888 96,879 5.06   2,398,526 96,523 5.37
               
 Total interest earning assets 4,253,064 117,894 3.70   3,960,649 121,664 4.10
               
Allowance for loan losses (49,420)       (45,197)    
Cash & non-interest earning assets 141,725       144,386    
               
               
Total assets  $ 4,345,369        $ 4,059,838    
               
               
Liabilities and shareholders' equity              
               
Deposits:              
Interest bearing checking accounts  $ 509,346 235 0.06%    $ 452,938 209 0.06%
Money market accounts 642,907 2,366 0.49   630,649 3,569 0.76
Savings 1,092,195 2,951 0.36   869,511 2,770 0.43
Time deposits 1,307,411 9,277 0.95   1,417,272 12,446 1.17
               
 Total interest bearing deposits 3,551,859 14,829 0.56   3,370,370 18,994 0.75
Short-term borrowings 150,039 1,114 0.99   130,890 1,173 1.20
               
 Total interest bearing liabilities 3,701,898 15,943 0.58   3,501,260 20,167 0.77
               
Demand deposits 276,484       254,187    
Other liabilities 18,922       18,070    
Shareholders' equity 348,065       286,321    
               
Total liabilities and shareholders' equity  $ 4,345,369        $ 4,059,838    
               
Net interest income , tax equivalent   101,951       101,497  
               
Net interest spread     3.12%       3.33%
               
Net interest margin (net interest income              
to total interest earning assets)     3.20%       3.42%
               
Tax equivalent adjustment   (543)       (954)  
               
               
 Net interest income    101,408       100,543  

 

Non-GAAP Financial Measures Reconciliation

Tangible book value per share and tangible equity as a percentage of tangible assets at period end are non-GAAP financial measures derived from GAAP-based amounts. We calculate tangible equity and tangible assets by excluding the balance of intangible assets from shareholders' equity and total assets, respectively. We calculate tangible book value per share by dividing tangible equity by common shares outstanding, as compared to book value per common share, which we calculate by dividing shareholders' equity by common shares outstanding. We calculate tangible equity as a percentage of tangible assets at period end by dividing tangible equity by tangible assets at period end. We believe that this is consistent with the treatment by bank regulatory agencies, which exclude intangible assets from the calculation of risk-based capital ratios. 

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