LCB Reports Record Income
July 28, 2016 at 4:25 p.m.
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"When Lake City Bank began this unrivaled streak in 1988, we had 10 offices, total assets of $207 million and reported net income of $808,000. During the 20 years of record income performance, we have more than quadrupled the number of offices to 43, our total assets have increased by nearly nine-fold to $2 billion and we have grown income by a multiple of more than 23 times. As we have for 135 years, the Lake City Bank Team again proved that a community-focused bank can continue to serve the best interests of our clients while at the same time creating long-term shareholder value," said Michael L. Kubacki, chairman, president and chief executive officer.
Net income of $19.2 million for 2007 represented an increase of 3 percent versus $18.7 million for 2006. Diluted net income per share for the year was $1.55 versus $1.51 for 2006. The company reported net income of $4.8 million for the fourth quarter of 2007, an increase of 6 percent over the $4.6 million reported for the fourth quarter of 2006. On a linked quarter basis, net income increased 10 percent versus the third quarter of 2007. Diluted net income per share for the quarter was $0.40 versus $0.38 for the comparable period of 2006 and $0.35 for the third quarter of 2007.
Kubacki said, "Lake City Bank further reinforced its reputation as the bank for business with loan growth of 13 percent, or $170 million, for the year. This was driven by a $152 million increase in traditional commercial and industrial and agribusiness loans. Our focus on the commercial business lending has contributed to ongoing economic development in Indiana and helped our clients expand and grow their businesses and contribute to job creation in Indiana."
"Revenue growth in 2007 was strong with a 7 percent increase in non-interest income, led by robust growth in our Wealth Advisory and Investment business-lines. We also continued to expand fee-based services to our core commercial clients with an improved cash management platform, which is designed to ensure that our clients have the latest technology-based banking products."
The company also announced the board of directors approved a cash dividend for the fourth quarter of $0.14 per share, payable on Feb.5 to shareholders of record as of Jan. 25. The quarterly dividend represents a 12 percent increase over the quarterly dividends paid in 2006.
The company's net interest margin was relatively stable at 3.14 percent in the fourth quarter versus 3.18 percent in the third quarter of 2007. Despite a continued shift in funding mix and the Federal Reserve Bank's recent interest rate cuts, the margin declined only nominally. As a result of the loan growth during the year, the company's net interest income increased by 4 percent to $54.6 million in 2007 versus $52.3 million in 2006.
Average total loans for the fourth quarter of 2007 were $1.46 billion versus $1.33 billion during the fourth quarter of 2006, an increase of 10 percent. Total gross loans as of Dec. 31, 2007, were $1.52 billion, an increase of $169.9 million, or 13 percent, versus $1.35 billion as of Dec. 31, 2006.
Net charge offs totaled $327,000 in the fourth quarter of 2007, versus $2 million during the third quarter of 2007, and $867,000 during the fourth quarter of 2006. Lakeland Financial's allowance for loan losses as of Dec. 31, 2007, was $15.8 million, compared to $15.1 million as of Sept. 30, 2007, and $14.5 million as of Dec. 31, 2006.
Nonperforming assets declined during the quarter by 30 percent since the conclusion of the third quarter of 2007 and totaled $9.9 million as of Dec. 31, 2007, compared to $14.1 million as of Sept. 30, 2007, and $14.2 million on Dec. 31, 2006. The ratio of nonperforming assets to assets improved to 0.50 percent on Dec. 31, 2007, compared to 0.75 percent at Sept. 30, 2007, and 0.77 percent at Dec. 31, 2006. The allowance for loan losses represented 212 pecent of nonperforming loans at year end versus 162 percent at Sept. 30, 2007, and 103 percent at Dec. 31, 2006.
The decrease in nonperforming assets during the fourth quarter of 2007 resulted from a reduction on other real estate owned of $2.4 million and a reduction of $1.9 million in nonperforming loans. The decline in other real estate owned was driven by the sale of assets related to a single former commercial borrower, a residential and commercial real estate developer. As of Dec. 31, 2007, total exposure related to this former borrower was $2.2 million versus $5.3 million at the end of the third quarter. All of the remaining exposure represents other real estate and the bank has no additional exposure to this borrower or its principals. The company is managing the other real estate owned to resolve the situation and believes that the carrying value is representative of true market value, although there can be no assurance that the ultimate sale of the assets will result in proceeds equal to or greater than the carrying value.
Kubacki said, "While we are proud of our progress on the asset quality front during the fourth quarter, we are cognizant of the economic and housing challenges facing the country and Northern Indiana. We will continue to closely monitor our portfolio and will not compromise our disciplined approach to lending in both the consumer and commercial segments."
For the three months ended Dec. 31, 2007, Lakeland Financial's average equity to average assets ratio was 7.47 percent compared to 7.49 percent for the third quarter of 2007 and 7.3 percent for the fourth quarter of 2006.
Average stockholders' equity for the quarter ended Dec. 31, 2007, was $143.9 million versus $138.8 million for the third quarter of 2007 and $128.9 million for the fourth quarter of 2006. Average total deposits for the quarter ended Dec. 31, 2007, were $1.52 billion versus $1.48 billion for the third quarter of 2007 and $1.46 billion for the fourth quarter of 2006.
Lakeland Financial Corporation is a $2 billion bank holding company headquartered in Warsaw. Lake City Bank serves Northern Indiana with 43 branches located in the following Indiana counties: Kosciusko, Elkhart, Allen, St. Joseph, DeKalb, Fulton, Huntington, LaGrange, Marshall, Noble, Pulaski and Whitley. The company also has a loan production office in Indianapolis.[[In-content Ad]]
"When Lake City Bank began this unrivaled streak in 1988, we had 10 offices, total assets of $207 million and reported net income of $808,000. During the 20 years of record income performance, we have more than quadrupled the number of offices to 43, our total assets have increased by nearly nine-fold to $2 billion and we have grown income by a multiple of more than 23 times. As we have for 135 years, the Lake City Bank Team again proved that a community-focused bank can continue to serve the best interests of our clients while at the same time creating long-term shareholder value," said Michael L. Kubacki, chairman, president and chief executive officer.
Net income of $19.2 million for 2007 represented an increase of 3 percent versus $18.7 million for 2006. Diluted net income per share for the year was $1.55 versus $1.51 for 2006. The company reported net income of $4.8 million for the fourth quarter of 2007, an increase of 6 percent over the $4.6 million reported for the fourth quarter of 2006. On a linked quarter basis, net income increased 10 percent versus the third quarter of 2007. Diluted net income per share for the quarter was $0.40 versus $0.38 for the comparable period of 2006 and $0.35 for the third quarter of 2007.
Kubacki said, "Lake City Bank further reinforced its reputation as the bank for business with loan growth of 13 percent, or $170 million, for the year. This was driven by a $152 million increase in traditional commercial and industrial and agribusiness loans. Our focus on the commercial business lending has contributed to ongoing economic development in Indiana and helped our clients expand and grow their businesses and contribute to job creation in Indiana."
"Revenue growth in 2007 was strong with a 7 percent increase in non-interest income, led by robust growth in our Wealth Advisory and Investment business-lines. We also continued to expand fee-based services to our core commercial clients with an improved cash management platform, which is designed to ensure that our clients have the latest technology-based banking products."
The company also announced the board of directors approved a cash dividend for the fourth quarter of $0.14 per share, payable on Feb.5 to shareholders of record as of Jan. 25. The quarterly dividend represents a 12 percent increase over the quarterly dividends paid in 2006.
The company's net interest margin was relatively stable at 3.14 percent in the fourth quarter versus 3.18 percent in the third quarter of 2007. Despite a continued shift in funding mix and the Federal Reserve Bank's recent interest rate cuts, the margin declined only nominally. As a result of the loan growth during the year, the company's net interest income increased by 4 percent to $54.6 million in 2007 versus $52.3 million in 2006.
Average total loans for the fourth quarter of 2007 were $1.46 billion versus $1.33 billion during the fourth quarter of 2006, an increase of 10 percent. Total gross loans as of Dec. 31, 2007, were $1.52 billion, an increase of $169.9 million, or 13 percent, versus $1.35 billion as of Dec. 31, 2006.
Net charge offs totaled $327,000 in the fourth quarter of 2007, versus $2 million during the third quarter of 2007, and $867,000 during the fourth quarter of 2006. Lakeland Financial's allowance for loan losses as of Dec. 31, 2007, was $15.8 million, compared to $15.1 million as of Sept. 30, 2007, and $14.5 million as of Dec. 31, 2006.
Nonperforming assets declined during the quarter by 30 percent since the conclusion of the third quarter of 2007 and totaled $9.9 million as of Dec. 31, 2007, compared to $14.1 million as of Sept. 30, 2007, and $14.2 million on Dec. 31, 2006. The ratio of nonperforming assets to assets improved to 0.50 percent on Dec. 31, 2007, compared to 0.75 percent at Sept. 30, 2007, and 0.77 percent at Dec. 31, 2006. The allowance for loan losses represented 212 pecent of nonperforming loans at year end versus 162 percent at Sept. 30, 2007, and 103 percent at Dec. 31, 2006.
The decrease in nonperforming assets during the fourth quarter of 2007 resulted from a reduction on other real estate owned of $2.4 million and a reduction of $1.9 million in nonperforming loans. The decline in other real estate owned was driven by the sale of assets related to a single former commercial borrower, a residential and commercial real estate developer. As of Dec. 31, 2007, total exposure related to this former borrower was $2.2 million versus $5.3 million at the end of the third quarter. All of the remaining exposure represents other real estate and the bank has no additional exposure to this borrower or its principals. The company is managing the other real estate owned to resolve the situation and believes that the carrying value is representative of true market value, although there can be no assurance that the ultimate sale of the assets will result in proceeds equal to or greater than the carrying value.
Kubacki said, "While we are proud of our progress on the asset quality front during the fourth quarter, we are cognizant of the economic and housing challenges facing the country and Northern Indiana. We will continue to closely monitor our portfolio and will not compromise our disciplined approach to lending in both the consumer and commercial segments."
For the three months ended Dec. 31, 2007, Lakeland Financial's average equity to average assets ratio was 7.47 percent compared to 7.49 percent for the third quarter of 2007 and 7.3 percent for the fourth quarter of 2006.
Average stockholders' equity for the quarter ended Dec. 31, 2007, was $143.9 million versus $138.8 million for the third quarter of 2007 and $128.9 million for the fourth quarter of 2006. Average total deposits for the quarter ended Dec. 31, 2007, were $1.52 billion versus $1.48 billion for the third quarter of 2007 and $1.46 billion for the fourth quarter of 2006.
Lakeland Financial Corporation is a $2 billion bank holding company headquartered in Warsaw. Lake City Bank serves Northern Indiana with 43 branches located in the following Indiana counties: Kosciusko, Elkhart, Allen, St. Joseph, DeKalb, Fulton, Huntington, LaGrange, Marshall, Noble, Pulaski and Whitley. The company also has a loan production office in Indianapolis.[[In-content Ad]]
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