Susquehanna Bancshares, Inc. Announces Second Quarter 2012 Results

Susquehanna Bancshares, Inc. (Susquehanna) (NASDAQ: SUSQ) today announced that it earned net income applicable to common shareholders for the second quarter ended June 30, 2012 of $37.8 million, or $0.20 per diluted share, compared to net income applicable to common shareholders of $11.1 million for the second quarter of 2011, or $0.09 per diluted share. Net income for the first six months of 2012 was $61.3 million, or $0.34 per diluted share, compared with $20.8 million, or $0.16 per diluted share for the first six months of 2011.

“We continue to recognize the benefits of our recent acquisitions and improving credit and core operating performance,” stated William J. Reuter, Chairman and Chief Executive Officer. “We are pleased with the energy and momentum that we are taking into the second half of the year and remain very focused on executing our Main Street relationship banking strategy to achieve our objectives for 2012 and beyond.”

Linked Quarter Results (Second Quarter 2012 vs. First Quarter 2012)
  • Loans and leases increased 0.5% from March 31, 2012 to $12.6 billion at June 30, 2012.
    • Susquehanna originated a gross amount of $862 million in new loans and leases during the second quarter, an increase of 9.2% over the $790 million originated in the first quarter of 2012.
    • Excluding real estate construction loans, loans and leases increased by $121.1 million, or 1.1%.
    • Commercial loans increased 0.6%.
    • Real estate – construction loans decreased 5.7%.
    • Real estate secured – residential loans increased 0.6%.
    • Real estate secured – commercial loans increased 0.3%.
    • Consumer loans increased 3.8%.
    • Leases increased 6.2%.
  • Total deposits increased 1.0% from March 31, 2012 to $12.7 billion at June 30, 2012, as deposit growth was impacted by the anticipated runoff of deposits assumed in recent acquisitions, including higher cost money market accounts.
    • Non-interest bearing demand deposits decreased 0.3%.
    • Interest-bearing demand deposits decreased 1.3%.
    • Savings deposits were generally flat.
    • Time deposits increased 5.1%.
  • Non-core items for the second quarter of 2012, after tax, were merger related expenses of $2.4 million, partially offset by net securities gains of $900 thousand.
  • Net interest margin increased 16 basis points to 4.10% compared to 3.94% for the first quarter of 2011, resulting principally from the impact of purchase accounting in connection with the acquisition of Tower Bancorp, Inc. (“Tower”), together with a full quarter of the Tower loan and deposit portfolios and offset by compression at core Susquehanna.
  • Non-interest income was $39.8 million for the second quarter of 2012, impacted by a full quarter of fees from the expanded customer base resulting from the Tower acquisition, as well as a 24% increase in mortgage banking income. Non-interest income for the quarter also includes pre-tax net securities gains of $1.4 million.
  • Non-interest expense for the second quarter of 2012 increased to $121.5 million, as Susquehanna recognized a full quarter of expenses resulting from the Tower acquisition without yet realizing a full quarter of anticipated cost savings from the Tower acquisition or core Susquehanna expense initiatives. Non-interest expense also includes pre-tax merger related expenses of $3.3 million.

Linked Quarter Results (Second Quarter 2012 vs. First Quarter 2012) (Continued)
  • The efficiency ratio for the second quarter of 2012 improved to 60.21% from 61.39% for the first quarter of 2012, in each case calculated after excluding pre-tax merger related expenses.
  • Net charge-offs as a percentage of average loans and leases for the quarter ended June 30, 2012 was 0.65% compared to 0.44% for the first quarter of 2012. Non-performing assets as a percentage of loans, leases and foreclosed real estate owned decreased 9 basis points from March 31, 2012 to 1.26% at June 30, 2012. The provision for loan and lease losses for the quarter ended June 30, 2012 was $16.0 million, compared to $19.0 million for the quarter ended March 31, 2012. The allowance for loan and lease losses was $190.6 million at June 30, 2012, representing 1.51% of total loans and lease and 150% of nonaccrual loans and leases, compared to $194.7 million at March 31, 2012, representing 1.56% of total loans and leases and 146% of nonaccrual loans and leases.

Second Quarter Financial Results:
  • Loans and leases increased 30.6% from June 30, 2011 to $12.6 billion at June 30, 2012.
    • Susquehanna originated a gross amount of $862 in new loans and leases during the second quarter, an increase of 30.2% over the $662 originated during the same period in 2011.
    • Growth in loans and leases consisted of:
      • $630.3 million acquired through the acquisition of Abington Bancorp, Inc. (“Abington”);
      • $2.0 billion acquired through the acquisition of Tower; and
      • $343.9 million of internally-generated loan growth, resulting in internal growth in loans and leases of 3.6% for the trailing four quarters.
    • Commercial loans increased 17.2%.
    • Real estate - construction loans increased 20.9%.
    • Real estate secured - residential loans increased 46.8%.
    • Real estate secured - commercial loans increased 34.5%.
    • Consumer loans increased 21.0%.
    • Leases increased 5.8%.
  • Total deposits increased 35.0% from June 30, 2011 to $12.7 billion at June 30, 2012.
    • Growth in total deposits consisted of:
      • $857.3 million of deposits assumed in the Abington acquisition;
      • $2.0 billion of deposits assumed in the Tower acquisition; and
      • $356.3 million in organic deposit growth, resulting in organic deposit growth of 3.8% for the trailing four quarters.
    • Non-interest-bearing demand deposits increased 36.5%.
    • Interest-bearing demand deposits increased 50.7%.
    • Savings deposits increased 24.8%.
    • Time deposits increased 20.8%.

Second Quarter Financial Results (Continued)
  • Net interest margin increased 48 basis points to 4.10% compared to 3.62% for the second quarter of 2011, driven primarily by the balance sheet restructuring in the fourth quarter of 2011, purchase accounting in connection with the Tower acquisition, the addition of the Tower deposit and loan portfolios and continued core reduction in funding costs at Susquehanna.
  • The efficiency ratio for the second quarter of 2012 improved to 60.21% from 68.26% in the second quarter of 2011, in each case calculated after excluding pre-tax merger related expenses.
  • Net charge-offs as a percentage of average loans and leases for the quarter ended June 30, 2012 was 0.65% compared to 1.33% for the second quarter of 2011. Non-performing assets as a percentage of loans, leases and foreclosed real estate was 1.26% at June 30, 2012 compared to 2.26% at June 30, 2011. The provision for loan and lease losses for the quarter ended June 30, 2012 was $16.0 million, compared to $28.0 million for the quarter ended June 30, 2011. The allowance for loan and lease losses was $190.6 million at June 30, 2012, representing 1.51% of total loans and leases and 150% of nonaccrual loans and leases, compared to $189.3 million at June 30, 2011, representing 1.96% of total loans and leases and 99% of nonaccrual loans and leases.
  • Return on average assets and average tangible equity (1) for the second quarter ended June 30, 2012 finished at 0.85% and 13.23%, respectively. This compared to results of 0.32% and 5.24% for the same measurements, respectively, for the second quarter of 2011.
  • Return on average assets and average tangible equity(1) for the first six months of 2012 finished at 0.72% and 10.77%, respectively. This compared to results of 0.30% and 5.05% for the same measurements, respectively, for the first six months of 2011.

Second Quarter Financial Results (Continued)
  • Susquehanna’s regulatory capital ratios are as follows:
   

Management
 

Preliminary Minimum

At June 30, 2012

Minimum Targets

Basel III Requirements*
Tangible Common Ratio(2) 7.64% 7.5% N/A
Tier 1 Common Ratio 9.97% 8.0% 7.0%
Leverage Ratio 9.95% 6.0% 4.0%
Tier 1 Capital Ratio 12.63% 9.5% 8.5%
Total Risk-Based Capital Ratio 14.38% 11.5% 10.5%

* Includes proposed conservation buffers
 

(1) A non-GAAP-based financial measure. The most comparable GAAP-based measurement for return on average tangible equity is return on average equity. A reconciliation of the differences between non-GAAP-based and GAAP-based measurements can be found at the end of this release under the heading "Supplemental Reporting of Non-GAAP-Based Financial Measures."

(2) Includes deferred tax liability associated with intangibles of $49.4 million

Additional Events
  • On July 18, 2012, Susquehanna’s Board of Directors declared a third quarter dividend of $0.06 per common share, payable August 20, 2012 to shareholders of record as of July 31, 2012. This represents a $0.01 increase from the second quarter dividend of $0.05 per share.
  • In response to the release by federal banking agencies of a joint notice of proposed rulemaking that addresses, among other things, Basel III capital guidelines and the capital treatment of certain securities, Susquehanna is conducting a thorough review and analysis of its options for redeeming certain trust preferred and other capital securities.

Susquehanna will broadcast its second quarter 2012 results conference call over the Internet on July 26, 2012 at 11:00 a.m. Eastern time. The conference call will include management’s discussion of second quarter 2012 results. The discussion may also include forward-looking information and financial goals, including updates of previously disclosed financial goals. Investors will have the opportunity to listen to the conference call through a live broadcast on Susquehanna’s Web site. The event may be accessed by selecting "Investor Relations" near the top right of the home page then “Overview” and clicking on the second quarter webcast link. To listen to the live call, please go to the Web site at least fifteen minutes prior to the scheduled start time to download and install any necessary audio software. For those who are unable to listen to the live broadcast, an archived replay and podcast will be available on the Web site shortly after the call concludes.

Susquehanna is a financial services holding company with assets of approximately $18 billion. Headquartered in Lititz, Pa., Susquehanna provides banking and financial services at 260 branch locations in the mid-Atlantic region. Through Susquehanna Wealth Management, the company offers investment, fiduciary, brokerage, insurance, retirement planning, and private banking services, with approximately $7.5 billion in assets under management and administration. Susquehanna also operates an insurance brokerage and employee benefits company, a commercial finance company and a vehicle leasing company. Investor information may be requested through Susquehanna’s Web site at www.susquehanna.net.

This press release contains certain financial information determined by methods other than in accordance with GAAP. Susquehanna’s management uses these non-GAAP measures in its analysis of the company’s performance. These non-GAAP financial measures require management to make judgments about the exclusion of certain items, and if different judgments were made, the amounts reported would be different. These measures typically exclude the effects of intangibles and related amortization and include the tax benefit associated with revenue items that are tax-exempt. Disclosures regarding these non-GAAP financial measures are included in the accompanying financial information.

The presentation of these non-GAAP financial measures is intended to supplement investors’ understanding of Susquehanna’s core business activities. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies.

This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various risks, uncertainties and other factors. Such risks, uncertainties and other factors that could cause actual results and experience to differ from those projected include, but are not limited to, the following: ineffectiveness of Susquehanna’s business strategy due to changes in current or future market conditions; the effects of competition, and of changes in laws and regulations, including industry consolidation and development of competing financial products and services; interest rate movements; changes in credit quality; inability to achieve merger-related synergies; difficulties in integrating distinct business operations, including information technology difficulties; and deteriorating economic conditions, and other risks and uncertainties, including those detailed in Susquehanna’s filings with the Securities and Exchange Commission. Susquehanna encourages readers of this release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Forward-looking statements speak only as of the date they are made. Susquehanna does not intend to update publicly any forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made or to reflect the occurrence of unanticipated events except as required by law.
Susquehanna Bancshares, Inc.
26 North Cedar Street
Lititz, PA 17543
       
SUMMARY FINANCIAL INFORMATION
(Dollars in thousands, except per common share data)
 
Six Months
2Q12 2Q11 2012 2011
Balance Sheet (EOP)
Investments $2,866,119 $2,615,203 $2,866,119 $2,615,203
Loans and leases 12,585,912 9,636,187 12,585,912 9,636,187
Allowance for loan & lease losses (ALLL) 190,628 189,292 190,628 189,292
Total assets 18,040,009 14,157,744 18,040,009 14,157,744
Deposits 12,690,524 9,402,515 12,690,524 9,402,515
Short-term borrowings 648,675 635,183 648,675 635,183
Federal Home Loan Bank (FHLB) borrowings 1,015,724 1,115,517 1,015,724 1,115,517
Other long-term debt 678,282 683,867 678,282 683,867
Shareholders' equity 2,544,730 2,022,902 2,544,730 2,022,902
 
Stated book value per common share 13.67 15.55 13.67 15.55
Tangible book value per common share 6.59 7.50 6.59 7.50
 
Average Balance Sheet
Investments $2,704,232 $2,473,101 $2,625,820 $2,475,425
Loans and leases 12,527,713 9,620,320 11,969,652 9,602,309
Total earning assets 15,332,806 12,171,868 14,699,194 12,156,630
Total assets 17,799,678 14,035,708 17,037,226 14,000,922
Deposits 12,471,296 9,341,761 11,912,917 9,292,581
Other short-term borrowings 726,309 667,856 684,218 707,588
Federal Home Loan Bank (FHLB) borrowings 1,082,293 1,115,754 1,033,794 1,108,100
Other long-term debt 686,492 690,573 680,107 695,522
Shareholders' equity 2,537,250 2,000,395 2,442,788 1,992,024
 
Income Statement
Net interest income $152,670 $106,086 $286,792 $211,109
Provision for loan and lease losses 16,000 28,000 35,000 63,000
Noninterest income 39,811 37,054 79,326 74,521
Noninterest expense 121,475 101,157 241,830 197,039
Income before taxes 55,006 13,983 89,288 25,591
Provision for income taxes 17,213 2,928 28,022 4,775
Net income 37,793 11,055 61,266 20,816
Basic earnings per common share 0.20 0.09 0.34 0.16
Diluted earnings per common share 0.20 0.09 0.34 0.16
Cash dividends paid per common share 0.05 0.02 0.08 0.03
 
Asset Quality
Net charge-offs (NCOs) $20,102 $31,941 $32,472 $65,542
 
Nonaccrual loans & leases $127,250 $190,733 $127,250 $190,733
Foreclosed real estate 31,302 27,953 31,302 27,953
Total nonperforming assets (NPAs) $158,552 $218,686 $158,552 $218,686
 
Restructured loans $66,777 $62,143 $66,777 $62,143
Loans & leases 90 days past due 11,203 18,268 11,203 18,268
 

Susquehanna Bancshares, Inc.
26 North Cedar Street
Lititz, PA 17543
       
Six Months
RATIO ANALYSIS 2Q12 2Q11 2012 2011
 
Credit Quality
NCOs / Average loans & leases 0.65% 1.33% 0.55% 1.38%
NPAs / Loans & leases + foreclosed real estate 1.26% 2.26% 1.26% 2.26%
ALLL / Nonaccrual loans & leases 149.81% 99.24% 149.81% 99.24%
ALLL / Total loans & leases 1.51% 1.96% 1.51% 1.96%
 
Capital Adequacy
Equity / Assets 14.11% 14.29% 14.11% 14.29%
Long-term debt / Equity 26.65% 33.81% 26.65% 33.81%
 
Profitability
Return on average assets 0.85% 0.32% 0.72% 0.30%
Return on average equity 5.99% 2.22% 5.04% 2.11%
Return on average tangible equity (2) 13.23% 5.24% 10.77% 5.05%
Net interest margin 4.10% 3.62% 4.03% 3.62%
Efficiency ratio (1) 60.21% 68.26% 60.77% 66.77%
 
(1) Excludes Merger related expenses
(2) Supplemental Reporting of Non-GAAP-based Financial Measures-Return on average tangible equity
 

Return on average tangible equity is a non-GAAP-based financial measure calculated using non-GAAP-based amounts. The most directly comparable measure is return on average equity which is calculated using GAAP-based amounts. We calculate return on average tangible equity by excluding the balance of intangible assets and their related amortization expense from our calculation of return on average equity. Management uses the return on average tangible equity in order to review our core operating results. Management believes that this is a better measure of our performance. In addition, this is consistent with the treatment by bank regulatory agencies, which excludes goodwill and other intangible assets from the calculation of risk-based capital ratios. A reconciliation of return on average equity to return on average tangible equity is set forth below.
      Six Months
2Q12 2Q11 2012   2011
Return on average equity (GAAP basis) 5.99% 2.22% 5.04% 2.11%
Effect of excluding average intangible assets
and related amortization 7.24% 3.02% 5.73% 2.94%
Return on average tangible equity 13.23% 5.24% 10.77% 5.05%
 

Susquehanna Bancshares, Inc.
26 North Cedar Street
Lititz, PA 17543
   
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
 
June 30, December 31, June 30,
  2012     2011     2011  
(in thousands, except share data)
Assets
Cash and due from banks $ 412,282 $ 276,384 $ 211,953
Unrestricted short-term investments   31,239     55,761     29,135  

Cash and cash equivalents
443,521 332,145 241,088
Interest-bearing deposits held by consolidated variable interest entities that can be
used only to settle obligations of the consolidated variable interest entities 5,485 5,015 4,946
Restricted short-term investments 67,650 60,910 48,660
Securities available for sale 2,719,186 2,295,034 2,491,644
Restricted investment in bank stocks 146,933 128,073 123,559
Loans and leases, net of deferred costs and fees 12,409,181 10,257,161 9,431,453
Loans held by consolidated variable interest entities that can be used only to settle
obligations of the consolidated variable interest entities 176,731 190,769 204,734
Less: Allowance for loan and lease losses   190,628     188,100     189,292  
Net loans and leases   12,395,284     10,259,830     9,446,895  
Premises and equipment, net 193,404 168,382 165,161
Other real estate and foreclosed assets 37,220 41,716 29,426
Accrued interest receivable 41,274 36,820 35,084
Bank-owned life insurance 449,023 405,296 358,967
Goodwill 1,269,205 1,018,031 1,018,031
Intangible assets with finite lives 47,831 29,081 29,779
Deferred income tax assets 47,914 6,344 4,873
Other assets   176,079     188,112     159,631  
Total assets $ 18,040,009   $ 14,974,789   $ 14,157,744  
Liabilities and Shareholders' Equity
Deposits:
Demand $ 1,940,990 $ 1,569,811 $ 1,421,947
Interest-bearing demand 5,423,198 4,439,488 3,598,052
Savings 1,007,157 868,709 807,117
Time 2,441,902 2,157,282 2,052,626
Time of $100 or more   1,877,277     1,255,182     1,522,773  
Total deposits 12,690,524 10,290,472 9,402,515
Federal Home Loan Bank short-term borrowings 900,000 900,000 400,000
Other short-term borrowings 648,675 613,306 635,183
Federal Home Loan Bank long-term borrowings 115,724 71,020 715,517
Other long-term debt 200,298 176,030 176,034
Junior subordinated debentures 346,393 323,317 323,125
Long-term debt of consolidated variable interest entities for which creditors do not
have recourse to Susquehanna's general credit 131,591 157,379 184,708
Accrued interest, taxes, and expenses payable 83,102 50,670 48,343
Deferred income tax liabilities 0 25,827 41,020
Other liabilities   378,972     177,140     208,397  
Total liabilities   15,495,279     12,785,161     12,134,842  
Shareholders' equity:
Common stock, $2.00 par value, 400,000,000 shares authorized. Issued:
186,423,824 at June 30, 2012; 157,067,887 at December 31, 2011;
and 130,070,101 at June 30, 2011 372,848 314,136 260,140
Treasury stock, at cost. 202,883 at June 30, 2012; 200,748 at December 31, 2011;

and 2,527 at June 30, 2011
(1,282 ) (1,263 ) (24 )
Additional paid-in capital 1,643,474 1,397,152 1,298,109
Retained earnings 572,818 525,657 498,881

Accumulated other comprehensive loss, net of taxes of $24,126; $25,863; and $18,925
  (43,128 )   (46,054 )   (34,204 )
Total shareholders' equity   2,544,730     2,189,628     2,022,902  
Total liabilities and shareholders' equity $ 18,040,009   $ 14,974,789   $ 14,157,744  
 

Susquehanna Bancshares, Inc.

26 North Cedar Street

Lititz, PA 17543
       
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
  2012     2011     2012     2011  
(in thousands, except per share data)
Interest Income:
Loans and leases, including deferred costs and fees $ 166,149 $ 127,199 $ 314,504 $ 253,998
Securities:
Taxable 12,956 15,026 25,748 30,706
Tax-exempt 3,621 4,034 7,383 7,985
Dividends 1,098 996 2,095 2,018
Short-term investments   35     23     65     52  
Total interest income   183,859     147,278     349,795     294,759  
Interest Expense:
Deposits:
Interest-bearing demand and savings 5,623 5,624 11,670 11,436
Time 11,407 14,109 23,433 29,290
Federal Home Loan Bank short-term borrowings 3,157 3,030 6,057 5,338
Other short-term borrowings 2,179 1,837 4,301 3,734
Federal Home Loan Bank long-term borrowings 302 7,799 360 15,883
Other long-term debt   8,521     8,793     17,182     17,969  
Total interest expense   31,189     41,192     63,003     83,650  
Net interest income 152,670 106,086 286,792 211,109
Provision for loan and lease losses   16,000     28,000     35,000     63,000  
Net interest income, after provision for loan and lease losses   136,670     78,086     251,792     148,109  
Noninterest Income:
Service charges on deposit accounts 8,583 8,077 16,257 15,833
Vehicle origination and servicing fees 2,226 1,996 4,150 3,899
Asset management fees 7,359 7,125 14,432 14,286
Income from fiduciary-related activities 2,539 1,853 5,162 3,688
Commissions on brokerage, life insurance and annuity sales 2,399 2,356 4,306 4,610
Commissions on property and casualty insurance sales 3,930 3,468 8,987 7,453
Other commissions and fees 4,800 6,518 9,443 12,506
Income from bank-owned life insurance 1,631 1,149 3,103 2,255
Net gain on sale of loans and leases 4,396 2,419 8,146 6,470
Net realized gain on sales of securities 1,361 1,060 1,746 2,930
Total other-than-temporary impairment, net of recoveries 4,676 (2,380 ) 1,970 (4,366 )
Portion of recognized in other comprehensive income
(before taxes)   (4,676 )   1,767     (2,114 )   1,521  
Net impairment losses recognized in earnings 0 (613 ) (144 ) (2,845 )
Other   587     1,646     3,738     3,436  
Total noninterest income   39,811     37,054     79,326     74,521  
Noninterest Expenses:
Salaries and employee benefits 64,524 53,412 122,482 104,404
Occupancy 11,725 8,861 22,536 18,516
Furniture and equipment 4,309 3,239 7,926 6,305
Advertising and marketing 3,287 3,139 6,341 5,486
FDIC insurance 4,769 5,406 9,947 8,787
Legal fees 1,907 1,862 3,960 3,936
Amortization of intangible assets 3,402 2,133 5,916 4,296
Vehicle lease disposal 1,745 2,620 3,580 5,057
Merger related 3,318 952 14,797 1,487
Other   22,489     19,533     44,345     38,765  
Total noninterest expenses   121,475     101,157     241,830     197,039  
Income before income taxes 55,006 13,983 89,288 25,591
Provision for income taxes   17,213     2,928     28,022     4,775  
Net Income $ 37,793   $ 11,055   $ 61,266   $ 20,816  
Earnings per common share:
Basic $ 0.20 $ 0.09 $ 0.34 $ 0.16
Diluted $ 0.20 $ 0.09 $ 0.34 $ 0.16
Cash dividends per common share $ 0.05 $ 0.02 $ 0.08 $ 0.03
Average common shares outstanding:
Basic 187,616 129,761 179,471 129,744
Diluted 188,301 129,832 180,156 129,826
 

Susquehanna Bancshares, Inc.

26 North Cedar Street

Lititz, PA 17543
 
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
         
 
Interest rates and interest differential-taxable equivalent basis
 
Three Months Ended Three Months Ended
June 30, 2012 June 30, 2011
Average Average
(Dollars in thousands) Balance   Interest   Rate (%) Balance   Interest   Rate (%)
Assets
Short-term investments $ 100,861 $ 35 0.14 $ 78,447 $ 23 0.12
Investment securities:
Taxable 2,329,950 14,054 2.43 2,064,971 16,022 3.11
Tax-exempt   374,282     5,571 5.99   408,130     6,206 6.10
Total investment securities   2,704,232     19,625 2.92   2,473,101     22,228 3.61
Loans and leases, (net):
Taxable 12,148,763 162,812 5.39 9,315,101 124,424 5.36
Tax-exempt   378,950     5,134 5.45   305,219     4,270 5.61
Total loans and leases   12,527,713     167,946 5.39   9,620,320     128,694 5.37
 
Total interest-earning assets 15,332,806   187,606 4.92 12,171,868   150,945 4.97
Allowance for loan and lease losses (190,095 ) (200,983 )
Other non-earning assets   2,656,967     2,064,823  
 
Total assets $ 17,799,678   $ 14,035,708  
 
Liabilities
Deposits:
Interest-bearing demand $ 5,479,962 5,292 0.39 $ 3,652,558 5,324 0.58
Savings 1,004,829 332 0.13 806,682 300 0.15
Time 4,064,876 11,406 1.13 3,500,813 14,109 1.62
Other short-term borrowings 726,309 2,179 1.21 667,856 1,837 1.10
FHLB borrowings 1,082,293 3,459 1.29 1,115,754 10,829 3.89
Long-term debt   686,492     8,522 4.99   690,573     8,793 5.11
 
Total interest-bearing liabilities 13,044,761   31,190 0.96 10,434,236   41,192 1.58
Demand deposits 1,921,629 1,381,708
Other liabilities   296,038     219,369  
 
Total liabilities 15,262,428 12,035,313
 
Equity   2,537,250     2,000,395  
 
Total liabilities & shareholders' equity $ 17,799,678   $ 14,035,708  
 
Net interest income / yield on
average earning assets $ 156,416 4.10 $ 109,753 3.62

1.
 

Average loan balances include non accrual loans.

2.

Tax-exempt income has been adjusted to a tax-equivalent basis using a marginal tax rate of 35%.

3.

For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.

 

Susquehanna Bancshares, Inc.
26 North Cedar Street
Lititz, PA 17543
   
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
       
 
Interest rates and interest differential-taxable equivalent basis
 
Six Months Ended Six Months Ended
June 30, 2012 June 30, 2011
Average Average
(Dollars in thousands) Balance   Interest   Rate (%) Balance   Interest   Rate (%)
Assets
Short-term investments $ 103,722 $ 65 0.13 $ 78,896 $ 52 0.13
Investment securities:
Taxable 2,248,264 27,844 2.49 2,072,186 32,724 3.18
Tax-exempt   377,556     11,358 6.05   403,239     12,285 6.14
Total investment securities   2,625,820     39,202 3.00   2,475,425     45,009 3.67
Loans and leases, (net):
Taxable 11,606,955 308,032 5.34 9,303,458 248,532 5.39
Tax-exempt   362,697     9,957 5.52   298,851     8,409 5.67
Total loans and leases   11,969,652     317,989 5.34   9,602,309     256,941 5.40
 
Total interest-earning assets 14,699,194   357,256 4.89 12,156,630   302,002 5.01
Allowance for loan and lease losses (190,700 ) (196,125 )
Other non-earning assets   2,528,732     2,040,417  
 
Total assets $ 17,037,226   $ 14,000,922  
 
Liabilities
Deposits:
Interest-bearing demand $ 5,235,126 11,009 0.42 $ 3,669,649 10,843 0.60
Savings 967,164 661 0.14 793,655 593 0.15
Time 3,905,863 23,433 1.21 3,468,520 29,290 1.70
Other short-term borrowings 684,218 4,301 1.26 707,588 3,734 1.06
FHLB borrowings 1,033,794 6,417 1.25 1,108,100 21,221 3.86
Long-term debt   680,107     17,182 5.08   695,522     17,969 5.21
 
Total interest-bearing liabilities 12,506,272   63,003 1.01 10,443,034   83,650 1.62
Demand deposits 1,804,764 1,360,757
Other liabilities   283,402     205,107  
 
Total liabilities 14,594,438 12,008,898
 
Equity   2,442,788     1,992,024  
 

Total liabilities & shareholders' equity
$ 17,037,226   $ 14,000,922  
 
Net interest income / yield on
average earning assets $ 294,253 4.03 $ 218,352 3.62
 

1.
 

Average loan balances include non accrual loans.

2.

Tax-exempt income has been adjusted to a tax-equivalent basis using a marginal tax rate of 35%.

3.

For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.

 

Susquehanna Bancshares, Inc.

26 North Cedar Street

Lititz, PA 17543
         
Loans and Leases
(Dollars in thousands)
 
Total Loans and Leases
06/30/12 12/31/11 06/30/11
Commercial, financial, and agricultural $ 2,101,561 $ 1,871,027 $ 1,793,490
Real estate - construction 936,996 829,221 775,096
Real estate secured - residential 3,970,115 3,212,562 2,704,802
Real estate secured - commercial 4,034,109 3,136,887 2,999,986
Consumer 805,490 722,329 665,602
Leases   737,641   675,904   697,211
Total loans and leases $ 12,585,912 $ 10,447,930 $ 9,636,187
 
 
Nonaccrual Loans and Leases
06/30/12 03/31/12 12/31/11 09/30/11 06/30/11
Commercial, financial, and agricultural $ 16,076 $ 20,616 $ 14,385 $ 14,421 $ 18,219
Real estate - construction 25,985 30,644 37,727 37,487 44,305
Real estate secured - residential 31,723 33,137 41,922 41,238 51,047
Real estate secured - commercial 52,296 47,423 61,497 65,377 73,346
Consumer 263 505 0 0 0
Leases   907   1,164   947   1,576     3,816
Total nonaccrual loans and leases $ 127,250 $ 133,489 $ 156,478 $ 160,099   $ 190,733
 
 
Restructured Loans
06/30/12 03/31/12 12/31/11 09/30/11 06/30/11
Commercial, financial, and agricultural $ 9,130 $ 9,547 $ 12,181 $ 11,820 $ 14,387
Real estate - construction 3,979 3,980 3,902 0 0
Real estate secured - residential 16,494 15,167 17,634 13,389 12,734
Real estate secured - commercial 36,671 42,883 38,565 36,974 34,874
Consumer   503   504   570   148     148
Total restructured loans $ 66,777 $ 72,081 $ 72,852 $ 62,331   $ 62,143
 
 
Net Charge-offs (Recoveries)
2Q 2012 1Q 2012 4Q 2011 3Q 2011 2Q 2011
Commercial, financial, and agricultural $ 7,145 $ 2,108 $ 1,557 $ 5,322 $ 9,138
Real estate - construction 4,987 2,830 8,484 6,489 6,352
Real estate secured - residential 2,553 3,652 2,641 5,262 5,042
Real estate secured - commercial 4,485 2,271 10,897 5,612 10,467
Consumer 53 928 503 (99 ) 67
Leases   879   581   778   746     875
Total net charge-offs $ 20,102 $ 12,370 $ 24,860 $ 23,332   $ 31,941

Copyright Business Wire 2010

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