Lake City Bank Reports Record Results
July 28, 2016 at 4:25 p.m.
By Staff Report-
The company achieved record net income of $8.8 million for the second quarter of 2012, an increase of 10 percent versus $8 million in the second quarter of 2011.
Diluted net income per share also increased 10 percent to a record level of $0.54 in the second quarter versus $0.49 for the comparable period of 2011.
The company also announced the board of directors approved a cash dividend for the second quarter of $0.17 per share, payable Aug. 6 to shareholders of record as of today.
The quarterly dividend represents a 10 percent increase over the quarterly dividends paid in 2011.
The company further reported record net income of $17.4 million for the six months ended June 30 versus $14 million for the comparable period of 2011, an increase of 25 percent.
Diluted net income per common share also set a new record and increased 23 percent to $1.06 for the six months ended June 30 versus $0.86 for the comparable period of 2011.
Michael L. Kubacki, chairman and chief executive officer, commented, “With strong earnings momentum and a robust balance sheet, Lake City Bank is well positioned to capitalize on our reputation as one of the leading commercial banks in Indiana. Our shareholders continue to be rewarded by these good results through a healthy dividend, as well as the performance of our stock, which has increased more than 30 percent in the last two years.”
Average total loans for the second quarter of 2012 were $2.22 billion versus $2.14 billion for the second quarter of 2011, an increase of 4 percent.
On a linked quarter basis, average loans grew by $5 million compared to the first quarter of 2012. Total loans outstanding grew $66 million, or 3 percent, from $2.15 billion as of June 30, 2011, to $2.21 billion as of June 30.
Net loans outstanding at June 30 represented a decrease of $19 million versus $2.23 billion as of Dec. 31.
Driving this $19 million decrease in net loans outstanding were anticipated reductions in non-owner occupied commercial real estate loans of $52 million and seasonal reductions in total agri-business loans of $17 million.
Kubacki added, “Overall, loan demand has been good in 2012. Yet, quarter-end loan totals reflect the impact of payoffs of existing credit facilities, particularly in our commercial real estate portfolio. This portfolio has been significantly reduced through the anticipated and successful placement of these interim project financings with long-term, non-bank institutional lenders.”
The company’s net interest margin was 3.32 percent in the second quarter of 2012 versus 3.53 percent for the second quarter of 2011 and 3.41 percent in the linked first quarter of 2012.
The year-over-year margin decline resulted primarily from reduced yields in the investment portfolio and slightly lower commercial loan yields as interest rates continue to be at historic lows.
For the six months ended June 30, the company’s net interest margin was 3.37 percent versus 3.66 percent for the comparable period in 2011.
David M. Findlay, president and chief financial officer, stated, “With the prolonged and unprecedented period of low interest rates continuing, we’re experiencing net interest margin compression as the rates we earn on loans and investments continue to decline. Absent any material change in the Federal Reserve’s stance on rates, we expect to continue to see a tightening margin.”
The company’s tangible common equity to tangible assets ratio was 9.58 percent at June 30 compared to 9.37 percent at June 30, 2011, and 9.41 percent at March 31.
Average total deposits for the quarter ended June 30 were $2.55 billion versus $2.43 billion for the first quarter of 2012 and $2.34 billion for the second quarter of 2011.
Findlay added, “We’ve done an exceptional job of building a capital structure that provides us with a solid base for future loan growth. This capital strength will be critical to our competitive position as the inevitable rebound in our economy continues and, as a result, loan demand picks up. We believe that an important use of our capital is to lend money to our clients and contribute to the commercial recovery and expansion of our Indiana communities.”
The company’s provision for loan losses in the second quarter of 2012 was $500,000 versus $2.9 million in the same period of 2011.
In the first quarter of 2012, the provision was $799,000. For the six months ended June 30, the company’s provision for loan losses was $1.3 million versus $8.5 million for the comparable period in 2011.
The provision decrease on a year-over-year basis was generally driven by the stabilization and improvement in key loan quality metrics, adequate reserve coverage of non-performing loans, continuing signs of stabilization in the economic conditions of the company’s markets and general signs of improvement in our borrowers’ performance and future prospects.[[In-content Ad]]
The company achieved record net income of $8.8 million for the second quarter of 2012, an increase of 10 percent versus $8 million in the second quarter of 2011.
Diluted net income per share also increased 10 percent to a record level of $0.54 in the second quarter versus $0.49 for the comparable period of 2011.
The company also announced the board of directors approved a cash dividend for the second quarter of $0.17 per share, payable Aug. 6 to shareholders of record as of today.
The quarterly dividend represents a 10 percent increase over the quarterly dividends paid in 2011.
The company further reported record net income of $17.4 million for the six months ended June 30 versus $14 million for the comparable period of 2011, an increase of 25 percent.
Diluted net income per common share also set a new record and increased 23 percent to $1.06 for the six months ended June 30 versus $0.86 for the comparable period of 2011.
Michael L. Kubacki, chairman and chief executive officer, commented, “With strong earnings momentum and a robust balance sheet, Lake City Bank is well positioned to capitalize on our reputation as one of the leading commercial banks in Indiana. Our shareholders continue to be rewarded by these good results through a healthy dividend, as well as the performance of our stock, which has increased more than 30 percent in the last two years.”
Average total loans for the second quarter of 2012 were $2.22 billion versus $2.14 billion for the second quarter of 2011, an increase of 4 percent.
On a linked quarter basis, average loans grew by $5 million compared to the first quarter of 2012. Total loans outstanding grew $66 million, or 3 percent, from $2.15 billion as of June 30, 2011, to $2.21 billion as of June 30.
Net loans outstanding at June 30 represented a decrease of $19 million versus $2.23 billion as of Dec. 31.
Driving this $19 million decrease in net loans outstanding were anticipated reductions in non-owner occupied commercial real estate loans of $52 million and seasonal reductions in total agri-business loans of $17 million.
Kubacki added, “Overall, loan demand has been good in 2012. Yet, quarter-end loan totals reflect the impact of payoffs of existing credit facilities, particularly in our commercial real estate portfolio. This portfolio has been significantly reduced through the anticipated and successful placement of these interim project financings with long-term, non-bank institutional lenders.”
The company’s net interest margin was 3.32 percent in the second quarter of 2012 versus 3.53 percent for the second quarter of 2011 and 3.41 percent in the linked first quarter of 2012.
The year-over-year margin decline resulted primarily from reduced yields in the investment portfolio and slightly lower commercial loan yields as interest rates continue to be at historic lows.
For the six months ended June 30, the company’s net interest margin was 3.37 percent versus 3.66 percent for the comparable period in 2011.
David M. Findlay, president and chief financial officer, stated, “With the prolonged and unprecedented period of low interest rates continuing, we’re experiencing net interest margin compression as the rates we earn on loans and investments continue to decline. Absent any material change in the Federal Reserve’s stance on rates, we expect to continue to see a tightening margin.”
The company’s tangible common equity to tangible assets ratio was 9.58 percent at June 30 compared to 9.37 percent at June 30, 2011, and 9.41 percent at March 31.
Average total deposits for the quarter ended June 30 were $2.55 billion versus $2.43 billion for the first quarter of 2012 and $2.34 billion for the second quarter of 2011.
Findlay added, “We’ve done an exceptional job of building a capital structure that provides us with a solid base for future loan growth. This capital strength will be critical to our competitive position as the inevitable rebound in our economy continues and, as a result, loan demand picks up. We believe that an important use of our capital is to lend money to our clients and contribute to the commercial recovery and expansion of our Indiana communities.”
The company’s provision for loan losses in the second quarter of 2012 was $500,000 versus $2.9 million in the same period of 2011.
In the first quarter of 2012, the provision was $799,000. For the six months ended June 30, the company’s provision for loan losses was $1.3 million versus $8.5 million for the comparable period in 2011.
The provision decrease on a year-over-year basis was generally driven by the stabilization and improvement in key loan quality metrics, adequate reserve coverage of non-performing loans, continuing signs of stabilization in the economic conditions of the company’s markets and general signs of improvement in our borrowers’ performance and future prospects.[[In-content Ad]]
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