- Tangible book value and tangible common equity as a percentage of tangible assets increased during 2009 due to operating activities and FDIC-assisted transactions.
- Higher levels of net interest income were achieved in 2009 than in 2008.
- Non-CD deposits increased to 61% of total deposits at the end of 2009, up from 46% in 2008.
- Net income available to common shareholders was affected by $54.8 million goodwill impairment recorded in the fourth quarter of 2009.
As of December 31, (dollars in thousands) Consolidated: 2009 2008 2007 2006 2005 Tangible Common Equity (TCE) $141,367 $131,887 $131,634 $118,268 $98,987 TCE /Tangible Common Assets 5.84% 5.62% 6.41% 5.95% 6.01% Tangible Book Value $10.22 $9.74 $9.67 $8.73 $7.64 Ameris Bank Tier 1 Leverage Capital 9.52% 7.25% 8.47% 8.64% 9.09% Total Risk Based Capital 14.34% 10.41% 11.68% 11.94% 12.14%Improvement in Pre-tax, Pre-Credit Net Income The Company continues to increase its core earnings (pre-tax, pre-credit) through various income and expense initiatives. Pre-tax, pre-credit income increased during the current quarter to $9.6 million, compared to $9.4 million in the third quarter of 2009 and $4.7 million in the fourth quarter of 2008. For the year to date period ended December 31, 2009, the Company's pre-tax, pre-credit income totaled $33.8 million, an increase of $2.1 million, or 6.6%, when compared to 2008. Edwin W. Hortman, Jr., President and CEO, commented on the Company's trends in core earnings saying, "Although our current run rate suggests that 2010's core earnings will continue to improve, we have developed and begun implementing "Project 2010". This new project covers numerous initiatives with the goal of improving our pre-tax, pre-credit income by approximately $7.5 million in 2010. These improvements are anticipated to further strengthen our capital base as we manage through the current economic environment. I am proud of our Company and the pace at which our employees have embraced the changes necessary to be successful in this initiative." Balance Sheet Trends During 2009, the Company saw several significant trends in earning assets and in its funding mix. With regard to earning assets, short-term assets (federal funds sold and interest bearing deposits) averaged $151.3 million during 2009 compared to $49.3 million in 2008. Traditionally, the Company's year-end balance sheet contains approximately $100 million of excess deposits from municipalities and businesses. Expected declines in these balances will reduce the Company's position in short-term assets and further improve capital ratios. Loans increased during 2009 to $1.71 billion from $1.70 billion at the end of 2008. The increase was the result of the loans acquired in the FDIC-assisted transactions during the fourth quarter of 2009 which amounted to $129.3 million at December 31, 2009. Investment securities decreased substantially during 2009, from $367.9 million at the end of 2008 to $247.3 million at the end of 2009 because management has not invested material amounts of short-term assets in the current interest rate environment. The Company's funding mix improved dramatically during 2009, leading to significant savings in cost of funds. At December 31, 2009, demand deposits (interest-bearing and non-interest bearing) amounted to $1.2 billion and comprised 55.8% of total deposits compared to $878 million, or 43.6% of total deposits, at December 31, 2008. During the same time, the Company's time deposits fell to $877 million, or 41.4% of total deposits, compared to $1.1 billion, or 56.4% of total deposits, at the end of 2008. Aggressive efforts marketing the Company's treasury management platform as well as retail deposit sales efforts were successful, particularly in the fourth quarter of 2009. Mr. Hortman commented on the Company's momentum with regard to core deposits saying, "The current economy has limited our outlook for loan growth, but the opportunities to grow our core deposits with individuals and small to medium size businesses have grown exponentially. I expect our Company to benefit significantly in 2010 and beyond from the expertise we have developed on business deposit sales in 2009." Net Interest Income In 2009, the Company reported $74.0 million in net interest income, a modest increase of $1.3 million, or 1.9%, from levels reported in 2008. Declines in interest income and yields on earning assets were offset by savings on interest expense realized from substantial improvements in the Company's funding mix. Yields on earning assets declined to 5.43% in 2009 compared to 6.43% in 2008. Declines in loan yields and the Company's concentration in low-yielding short-term assets accounted for the majority of the declines. Loan yields in 2009 were 6.03% compared to 6.85% in 2008. The concentration in short-term assets during 2009 amounted to 7.1% of earning assets, compared to 2.4% in 2008. The average yield on this higher level of liquidity in 2009 was 0.20%, a decline from 1.06% in 2008. The Company expects to begin managing toward incrementally lower levels of liquidity early in 2010.