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Glacier Bancorp, Inc. Announces Results for Quarter Ended June 30, 2010
22 Jul, 2010 @ 07:00 pm EDT
KALISPELL, Mont., July 22 /PRNewswire-FirstCall/ --
HIGHLIGHTS:
-- Net earnings for the quarter of $13.2 million and year-to-date of $23.3
million.
-- Diluted earnings per share of $0.19 for the quarter and $0.35
year-to-date.
-- Non-interest bearing deposits increased $24.0 million, or 12 percent
annualized, for the quarter.
-- Non-performing assets as a percentage of bank assets decreased for the
first time in 11 quarters.
-- Early stage delinquencies (accruing 30-89 day loans) decreased during
the quarter.
-- Successfully completed the integration and data conversion for First
National Bank & Trust.
-- Declared dividend for the 101st consecutive quarter. Dividend declared
of $0.13 per share.
Earnings Summary - unaudited Three months Six months
($ in thousands, except per
share data) ended June 30, ended June 30,
-------------- --------------
2010 2009 2010 2009
---- ---- ---- ----
Net earnings $13,222 10,652 $23,292 $26,431
Diluted earnings per share $0.19 0.17 $0.35 $0.43
Return on average assets
(annualized) 0.85% 0.77% 0.76% 0.96%
Return on average equity
(annualized) 6.25% 6.18% 6.02% 7.72%
------------------------ ---- ---- ---- ----
Glacier Bancorp, Inc. (Nasdaq: GBCI) reported net earnings of $13.2 million for the second quarter of 2010, an increase of $2.6 million, or 24 percent, from the $10.7 million net earnings reported for the second quarter of 2009. The diluted earnings per share of $0.19 for the quarter represented a 12 percent increase from the diluted earnings per share of $0.17 for the same quarter of 2009. Annualized return on average assets and return on average equity for the second quarter were 0.85 percent and 6.25 percent, respectively, which compares with prior year returns for the second quarter of 0.77 percent and 6.18 percent, respectively.
Net earnings for the six months ended June 30, 2010 were $23.3 million, which is a decrease of $3.1 million or 12 percent, over the prior year. Diluted earnings per share of $0.35 is a decrease of 19 percent over $0.43 earned in the first half of 2009.
"Second quarter results were an improvement over recent quarters. We still have more work to do in order to achieve the level of earnings we historically deliver and for us to be satisfied with our performance. However, we are encouraged by the progress we have made recently and hope to maintain this momentum" said Mick Blodnick, President and Chief Executive Officer. "One reason for the improvement was a reduced provision for loan loss, reflecting improving credit quality metrics. In addition, the quarter was straight forward and was absent much noise. The only exception was the sale of our merchant card servicing portfolio which added almost $0.02 per share to earnings," Blodnick said.
$Change from $Change from
December December
Assets June 30, 31, June 30, 31, June 30,
(Unaudited
-$ in
thousands) 2010 2009 2009 2009 2009
---- ---- ---- ---- ----
Cash on
hand and
in banks $95,603 120,731 100,773 (25,128) (5,170)
Investments,
interest
bearing
deposits,
FHLB stock,
FRB stock,
and fed
funds 1,816,133 1,596,238 1,081,160 219,895 734,973
Loans:
Residential
real estate 764,286 797,626 836,917 (33,340) (72,631)
Commercial 2,570,140 2,613,218 2,591,149 (43,078) (21,009)
Consumer
and other 697,743 719,401 700,693 (21,658) (2,950)
------- ------- ------- ------- ------
Loans
receivable,
gross 4,032,169 4,130,245 4,128,759 (98,076) (96,590)
Allowance
for loan
and lease
losses (141,665) (142,927) (97,374) 1,262 (44,291)
-------- -------- ------- ----- -------
Loans
receivable,
net 3,890,504 3,987,318 4,031,385 (96,814) (140,881)
--------- --------- --------- ------- --------
Other
assets 492,596 487,508 425,106 5,088 67,490
------- ------- ------- ----- ------
Total
assets $6,294,836 6,191,795 5,638,424 103,041 656,412
========== ========= ========= ======= =======
Total assets at June 30 2010 were $6.295 billion, which is $103 million, or 2 percent, greater than total assets of $6.192 billion at December 31, 2009. Total assets increased $656 million, or 12 percent, from June 30, 2009, of which $272 million, including $161 million in loans, related to the acquisition of First National Bank & Trust ("First National") in October 2009.
Investment securities, including interest bearing deposits, FHLB and FRB stock, and federal funds sold, have increased $220 million, or 14 percent, from December 31, 2009 and increased $735 million, or 68 percent, from June 30, 2009. The Company continues to purchase investment securities as loan originations slow, such purchases are predominately mortgage-backed securities issued by Freddie Mac and Fannie Mae with short weighted average lives. The Company continues to be very selective in its purchases of tax-exempt investment securities. Investment securities represent 29 percent of total assets at June 30, 2010 versus 19 percent of total assets at June 30, 2009.
At June 30, 2010, gross loans were $4.032 billion, a decrease of $98 million over gross loans of $4.130 billion at December 31, 2009. Excluding net charge-offs of $39 million and loans transferred to other real estate of $46 million, loans decreased $13 million, or 1 percent annualized, from December 31, 2009.
March December
Credit Quality Summary June 30, 31, 31, June 30,
(Unaudited - $ in thousands) 2010 2010 2009 2009
---- ---- ---- ----
Allowance for loan and lease
losses -beginning of year $142,927 142,927 76,739 76,739
Provision expense 38,156 20,910 124,618 40,855
Charge-offs (41,584) (21,477) (60,896) (21,246)
Recoveries 2,166 1,240 2,466 1,026
Allowance for loan and lease
losses -end of period $141,665 143,600 142,927 97,374
======== ======= ======= ======
Real estate and other assets
owned $64,419 59,481 57,320 47,424
Accruing loans 90 days or more
overdue 3,030 10,489 5,537 10,086
Non-accrual loans 190,338 198,169 198,281 116,362
Total non-performing assets $257,787 268,139 261,138 173,872
======== ======= ======= =======
Allowance for loan and lease
losses as a
percentage of non-performing
assets 55% 54% 55% 56%
Non-performing assets as a
percentage
of subsidiary assets 4.01% 4.19% 4.13% 3.06%
Allowance for loan and lease
losses as a
percentage of total loans 3.51% 3.53% 3.46% 2.36%
Net charge-offs as a percentage
of total loans (0.98%) (0.50%) (1.42%) (0.49%)
Accruing loans 30-89 days
overdue $36,487 61,255 87,491 62,637
------------------------- ------- ------ ------ ------
Credit Quality
At June 30, 2010, the allowance for loan and lease losses was $141.7 million, an increase of $44.3 million, or 45 percent, from a year ago. The allowance was 3.51 percent of total loans outstanding at June 30, 2010, such percentage down slightly from the 3.53 percent at March 31, 2010, but substantially higher than the 2.36 percent at June 30, 2009. The allowance was 55 percent of non-performing assets at June 30, 2010, the same percentage at the prior year end and down from 56 percent a year ago. Non-performing assets as a percentage of total subsidiary assets at June 30, 2010 were at 4.01 percent, down from 4.13 percent as of prior year end, and up from 3.06 percent at June 30, 2009. Loan portfolio growth, composition, average loan size, credit quality considerations, and other environmental factors will continue to determine the level of additional provision for loan loss expense.
Credit Quality
Trends
(Unaudited -$ in
thousands) Accruing
Non-
Loans 30-89 Performing
Provision ALLL Days Overdue Assets to
for as a as a Percent
Loan Net Percent of Total Bank
Charge-
Losses Offs of Loans Loans Assets
------ ------- -------- ----- ------
Q2 2010 $17,246 19,181 3.51% 0.90% 4.01%
Q1 2010 20,910 20,237 3.53% 1.50% 4.19%
Q4 2009 36,713 19,116 3.46% 2.12% 4.13%
Q3 2009 47,050 19,094 3.10% 1.08% 4.10%
Q2 2009 25,140 11,543 2.36% 1.52% 3.06%
Q1 2009 15,715 8,677 2.01% 1.60% 1.97%
Q4 2008 12,223 3,742 1.86% 1.33% 1.46%
Q3 2008 8,715 3,889 1.67% 0.65% 1.30%
------- ----- ----- ---- ---- ----
Allowance for Loan and Lease Losses
The current quarter provision for loan loss expense was $17.2 million, a decrease of $3.7 million from prior quarter and a decrease of $7.9 million from the same quarter in 2009. Net charged-off loans for the current quarter were $19.2 million compared to $20.2 million for the prior quarter and $11.5 million for the same quarter in 2009. "Asset quality trends were encouraging although this is still a challenging credit environment," Blodnick said. "The reduction in non-performing assets through the first half of the year was a pleasant surprise. We have been predicting higher levels of non-performing assets through the first half of the year. For the second straight quarter we also saw a significant reduction in early stage delinquencies. Nonetheless, it is still far too early to determine whether this trend will continue," Blodnick said.
During the quarter, the Company formed a wholly owned subsidiary, GBCI Other Real Estate ("GORE") to isolate bank foreclosed properties for legal protection and administrative purposes. During the quarter, foreclosed properties were transferred to the new entity from bank subsidiaries at fair market value and such properties are currently held for sale.
For additional information regarding credit quality and a breakout of the loan portfolio by regulatory classification, see the exhibits at the end of this press release.
$Change from $Change from
December December
Liabilities June 30, 31, June 30, 31, June 30,
(Unaudited -$
in thousands) 2010 2009 2009 2009 2009
---- ---- ---- ---- ----
Non-interest
bearing
deposits $852,121 810,550 754,844 41,571 97,277
Interest bearing
deposits 3,657,995 3,289,602 2,631,599 368,393 1,026,396
Advances from
Federal Home
Loan Bank 529,982 790,367 613,478 (260,385) (83,496)
Federal Reserve
Bank discount
window - 225,000 587,000 (225,000) (587,000)
Securities sold
under
agreements to
repurchase and
other borrowed
funds 234,460 226,251 197,971 8,209 36,489
Other
liabilities 49,470 39,147 43,711 10,323 5,759
Subordinated
debentures 125,060 124,988 120,157 72 4,903
------- ------- ------- --- -----
Total
liabilities $5,449,088 5,505,905 4,948,760 (56,817) 500,328
========== ========= ========= ======= =======
As of June 30, 2010, non-interest bearing deposits increased $42 million, or 10 percent annualized, since December 31, 2009 and increased $97 million, or 13 percent, since June 30, 2009. Interest bearing deposits of $3.658 billion at June 30, 2010 includes $414 million issued through the Certificate of Deposit Account Registry System. Interest bearing deposits increased $368 million, or 22 percent annualized, from December 31, 2009 and $1.026 billion, or 39 percent from June 30, 2009. The increase in interest bearing deposits from December 31, 2009 and June 30, 2009 includes $308 million and $507 million, respectively, from wholesale deposits. The increase in non-interest bearing deposits and interest bearing deposits from June 30, 2009 includes $39 million and $197 million, respectively, from the First National acquisition.
As a result of the deposit growth, borrowings overall have been reduced. Federal Home Loan Bank ("FHLB") advances decreased $260 million, or 33 percent, from December 31, 2009 and decreased $83 million, or 14 percent, from June 30, 2009. There were no Federal Reserve Bank borrowings through the Term Auction Facility program ("TAF") at June 30, 2010 due to cessation of the TAF program by the Federal Reserve. TAF borrowings totaled $225 million at December 31, 2009 and $587 million at June 30, 2009. Repurchase agreements and other borrowed funds were $234 million at June 30, 2010, an increase of $8 million from December 31, 2009 and an increase of $36 million from June 30, 2009.
Stockholders' equity - unaudited
($ in thousands except per share December
data) June 30, 31, June 30,
2010 2009 2009
---- ---- ----
Common equity $836,955 686,238 692,046
Accumulated other comprehensive
income (loss) 8,793 (348) (2,382)
----- ---- ------
Total stockholders' equity 845,748 685,890 689,664
Goodwill and core deposit
intangible, net (158,575) (160,196) (157,736)
-------- -------- --------
Tangible stockholders' equity $687,173 525,694 531,928
======== ======= =======
Stockholders' equity to total
assets 13.44% 11.08% 12.23%
Tangible stockholders' equity to
total tangible assets 11.20% 8.72% 9.71%
Book value per common share $11.76 11.13 11.21
Tangible book value per common
share $9.56 8.53 8.65
Market price per share at end of
period $14.67 13.72 14.77
-------------------------------- ------ ----- -----
Stockholders' equity - unaudited $Change from $Change from
($ in thousands except per share December
data) 31, June 30,
2009 2009
---- ----
Common equity 150,717 144,909
Accumulated other comprehensive
income (loss) 9,141 11,175
----- ------
Total stockholders' equity 159,858 156,084
Goodwill and core deposit
intangible, net 1,621 (839)
----- ----
Tangible stockholders' equity 161,479 155,245
======= =======
Stockholders' equity to total
assets
Tangible stockholders' equity to
total tangible assets
Book value per common share 0.63 0.55
Tangible book value per common
share 1.03 0.91
Market price per share at end of
period 0.95 (0.10)
-------------------------------- ---- -----
Total stockholders' equity and book value per share increased $156 million and $0.55 per share, respectively, from June 30, 2009, such increases largely the result of the $146 million in net proceeds from the Company's March equity offering of 10.291 million shares. Tangible stockholders' equity has increased $155 million, or 29 percent, since June 30, 2009, with tangible stockholders' equity to tangible assets at 11.20 percent and 9.71 percent as of June 30, 2010 and June 30, 2009, respectively. Accumulated other comprehensive income (loss), representing net unrealized gains or losses (net of tax) on investment securities, increased $9.1 million since December 31, 2009 and $11.2 million from June 30, 2009.
Cash Dividend
On June 30, 2010, the board of directors declared a cash dividend of $0.13 per share, payable July 22, 2010 to shareholders of record on July 13, 2010. Future cash dividends will depend on a variety of factors, including net income, capital, asset quality and general economic conditions.
Operating Results for Three Months Ended June 30, 2010
------------------------------------------------------
Compared to March 31, 2010 and June 30, 2009
--------------------------------------------
Revenue
summary
(Unaudited
-$ in
thousands) Three months ended
------------------
June 30, March 31, June 30,
2010 2010 2009
---- ---- ----
Net
interest
income
Interest
income $73,818 73,398 74,420
Interest
expense 13,749 13,884 13,939
------ ------ ------
Total net
interest
income 60,069 59,514 60,481
Non-
interest
income
Service
charges,
loan fees,
and other
fees 11,900 10,646 11,377
Gain on
sale of
loans 6,133 3,891 9,071
Gain on
sale of
investments 242 314 -
Other
income 3,143 1,332 870
----- ----- ---
Total non-
interest
income 21,418 16,183 21,318
------ ------ ------
$81,487 75,697 81,799
======= ====== ======
Net
interest
margin
(tax-
equivalent) 4.35% 4.43% 4.87%
==== ==== ====
(Unaudited
-$ in % Change % Change
thousands) $Change from $Change from from from
March 31, June 30, March 31, June 30,
2010 2009 2010 2009
---- ---- ---- ----
Net
interest
income
Interest
income $420 (602) 1% -1%
Interest
expense (135) (190) -1% -1%
---- ----
Total net
interest
income 555 (412) 1% -1%
Non-
interest
income
Service
charges,
loan fees,
and other
fees 1,254 523 12% 5%
Gain on
sale of
loans 2,242 (2,938) 58% -32%
Gain on
sale of
investments (72) 242 -23% n/m
Other
income 1,811 2,273 136% 261%
Total non-
interest
income 5,235 100 32% 0%
----- ---
$5,790 (312) 8% 0%
====== ====
n/m - not measurable
Net Interest Income
Net interest income for the current quarter increased $555 thousand and decreased $412 thousand over prior year's quarter. The current quarter net interest margin as a percentage of earning assets, on a tax-equivalent basis, was 4.35 percent which is 8 basis points lower than the 4.43 percent for the prior quarter and included a 4 basis points reduction from the reversal of interest on non-accrual loans. The net interest margin for the current quarter is 52 basis points lower than the 4.87 percent result for the second quarter of 2009. "Though funding costs continue to remain stable, investment of proceeds from loan paydowns and the March equity offering into low yielding investment securities continues to compress the net interest margin," said Ron Copher, Chief Financial Officer.
Non-interest Income
Non-interest income for the quarter totaled $21.4 million, an increase of $5.2 million over the prior quarter and $100 thousand over the same quarter as last year. Fee income of $11.9 million increased $1.3 million, or 12 percent, during the quarter primarily from an increase in debit card income. This compares to an increase of $523 thousand, or 5 percent, over the same period last year. Gain on sale of loans increased $2.2 million, or 58 percent, over the prior quarter as a reduction in mortgage interest rates during the second quarter led to an increase in loan origination volume. Gain on sale of loans decreased $2.9 million, or 32 percent, over the same period last year, primarily the result of a significant reduction in re-finance activity and a slowing of residential loans originated and sold in the secondary market. Net gain on sale of investments was $242 thousand for the current quarter 2010 compared to $314 thousand for the previous quarter. Other income of $3.1 million for the current quarter is an increase of $1.8 million and $2.3 million from prior quarter and prior year second quarter, respectively, of which $1.8 million relates to the current quarter sale of Mountain West Bank's merchant card servicing portfolio.
Non-interest
expense
summary Three months ended
------------------
(Unaudited -$
in thousands) June 30, March 31, June 30,
2010 2010 2009
---- ---- ----
Compensation
and employee
benefits and
relatd
expenses $21,652 $21,356 $20,710
Occupancy and
equipment
expense 5,988 5,948 5,611
Advertising
and promotion
expense 1,644 1,592 1,722
Outsourced
data
processing 761 694 680
Core deposit
intangibles
amortization 801 820 762
Other real
estate owned
expense 7,373 2,318 2,321
Federal
Deposit
Insurance
premiums 2,165 2,200 3,832
Other expenses 7,852 7,033 7,325
----- ----- -----
Total non-
interest
expense $48,236 $41,961 $42,963
======= ======= =======
(Unaudited -$ % Change % Change
in thousands) $Change from $Change from from from
March 31, June 30, March 31, June 30,
2010 2009 2010 2009
---- ---- ---- ----
Compensation
and employee
benefits and
relatd
expenses $296 $942 1% 5%
Occupancy and
equipment
expense 40 377 1% 7%
Advertising
and promotion
expense 52 (78) 3% -5%
Outsourced
data
processing 67 81 10% 12%
Core deposit
intangibles
amortization (19) 39 -2% 5%
Other real
estate owned
expense 5,055 5,052 218% 218%
FDIC premiums (35) (1,667) -2% -44%
Other expenses 819 527 12% 7%
--- ---
Total non-
interest
expense $6,275 $5,273 15% 12%
====== ======
Non-interest Expense
Non-interest expense of $48.2 million for the quarter increased by $6.3 million, or 15 percent, from the prior quarter and increased $5.3 million, or 12 percent, from the prior year second quarter. Compensation and employee benefits of $21.7 million increased only $296 thousand, or 1 percent, from the previous quarter and $942 thousand, or 5 percent, from the prior year second quarter which is due to the addition of First National employees. The number of full-time equivalent employees increased from 1,651 to 1,654 during the quarter, and increased from 1,597 since the end of the 2009 second quarter.
Occupancy and equipment expense increased $40 thousand, or 1 percent, from the prior quarter and increased $377 thousand, or 7 percent, from the prior year second quarter. Advertising and promotion expense increased $52 thousand, or 3 percent, from prior quarter and decreased $78 thousand, or 5 percent, from the second quarter of 2009. Other real estate owned expenses increased $5.1 million, or 218 percent, from prior quarter and increased $5.1 million, or 218 percent, from the prior year. The current quarter other real estate owned expense of $7.4 million included $1.5 million of operating expenses, $2.9 million of fair value write-downs, and $3.0 million of loss on sale of other real estate owned. The other real estate owned expenses have increased as the Company moves to aggressively dispose of problem assets and other real estate owned. FDIC premiums decreased $1.7 million, or 44 percent, from the prior year second quarter which included a FDIC special assessment. Other expenses increased $819 thousand, or 12 percent, from the prior quarter and increased $527 thousand, or 7 percent, from the prior year second quarter. "Other real estate owned expenses and write-downs were at an extraordinary high level this past quarter," Blodnick said. "We expect this expense category to remain elevated for the next couple of quarters as we work to move these properties. All other expense categories were in line or below expectations."
Efficiency Ratio
The efficiency ratio (non-interest expense / net interest income plus non-interest income) was 59 percent for the quarter, compared to 53 percent for the 2009 second quarter. The increase in the efficiency ratio from the prior year is the result of the increase in other expenses primarily from other real estate owned expenses, losses and write-downs.
Operating Results for Six Months Ended June 30, 2010 Compared to June
30, 2009
---------------------------------------------------------------------
Revenue
summary
(Unaudited
-$ in % Change
thousands) Six months ended $Change From From
----------------
June 30, June 30, June 30, June 30,
2010 2009 2009 2009
---- ---- ---- ----
Net
interest
income
Interest
income $147,216 $149,952 $(2,736) -2%
Interest
expense 27,633 29,093 (1,460) -5%
------ ------ ------
Net
interest
income 119,583 120,859 (1,276) -1%
Non-
interest
income
Service
charges,
loan
fees,
and
other
fees 22,546 21,556 990 5%
Gain on
sale of
loans 10,024 15,221 (5,197) -34%
Gain on
sale of
investments 556 - 556 n/m
Other
income 4,475 1,918 2,557 133%
----- ----- -----
Total
non-
interest
income 37,601 38,695 (1,094) -3%
------ ------ ------
$157,184 $159,554 $(2,370) -1%
======== ======== =======
Net
interest
margin
(tax-
equivalent) 4.39% 4.90%
==== ====
Net Interest Income
Net interest income for the six month period decreased $1.3 million, or 1 percent, over the same period in 2009. Total interest income decreased $2.7 million, or 2 percent, while total interest expense decreased $1.5 million, or 5 percent. The decrease in interest income is due to a lower yield and volume of loans coupled with an increase in lower yielding investment securities. The decrease in interest expense is primarily attributable to the rate decreases on interest bearing deposits and lower cost borrowings. The net interest margin as a percentage of earning assets, on a tax equivalent basis, decreased 51 basis points from 4.90 percent for 2009 to 4.39 percent for 2010.
Non-interest Income
Non-interest income decreased $1.1 million over the same period in 2009. Fee income for the first half of 2010 has increased $990 thousand, or 5 percent, compared to prior year primarily from an increase in debit card income. Gain on sale of loans decreased $5.2 million, or 34 percent, over the first six months of last year, primarily the result of a significant reduction in re-finance activity and a slowing of residential loans originated and sold in the secondary market. Other income increased $2.6 million over the same period in 2009, of which $1.8 million relates to the current quarter sale of Mountain West Bank's merchant card servicing portfolio.
Non-
interest
expense % Change
summary Six months ended $Change From From
----------------
(Unaudited
-$
in
thousands) June 30, June 30, June 30, June 30,
2010 2009 2009 2009
---- ---- ---- ----
Compensation
and
employee
benefits $43,008 $42,654 $354 1%
Occupancy
and
equipment
expense 11,936 11,506 430 4%
Advertising
and
promotion
expense 3,236 3,446 (210) -6%
Outsourced
data
processing 1,455 1,351 104 8%
Core
deposit
intangibles
amortization 1,621 1,536 85 6%
Other
real
estate
owned
expense 9,691 2,841 6,850 241%
FDIC
premiums 4,365 5,000 (635) -13%
Other
expenses 14,885 14,255 630 4%
------ ------ ---
Total
non-
interest
expense $90,197 $82,589 $7,608 9%
======= ======= ======
Non-interest Expense
Non-interest expense for the first six month of 2010 increased by $7.6 million, or 9 percent, from the same period prior year. Compensation and employee benefits increased $354 thousand, or 1 percent, from 2009. Occupancy and equipment expense increased $430 thousand, or 4 percent, reflecting the cost of additional locations and facility upgrades. Advertising and promotion expense decreased by $210 thousand, or 6 percent, from 2009. Other real estate owned expense increased $6.9 million, or 241 percent, from the prior first six months. The other real estate owned expenses for the first six months of 2010 of $9.7 million included $2.2 million of operating expenses, $3.3 million of fair value write-downs, and $4.2 of loss on sale of other real estate owned. FDIC premiums decreased $635 thousand, or 13 percent, from the prior year first six months which included a special assessment of $2.5 million. Other expense increased $630 thousand, or 4 percent, from the prior year.
Efficiency Ratio
The efficiency ratio (non-interest expense / net interest income plus non-interest income) was 57 percent for the first six months of 2010, compared to 52 percent for the same period in 2009. The increase in the efficiency ratio from the prior year is the result of the increase in other expenses primarily from other real estate owned expenses, losses and write-downs.
Allowance for Loan and Lease Losses
The provision for loan loss expense was $38.2 million for the first six months of 2010, a decrease of $2.7 million, or 7 percent, from the same period in 2009. Net charged-off loans during the six months ended June 30, 2010 was $39.4 million, an increase of $19.2 million from the same period in 2009.
About Glacier Bancorp, Inc.
Glacier Bancorp, Inc. is a regional multi-bank holding company providing commercial banking services in 60 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and conducts its operations principally through eleven community bank subsidiaries. These subsidiaries include: six Montana banks - Glacier Bank of Kalispell, First Security Bank of Missoula, Valley Bank of Helena, Big Sky Western Bank of Bozeman, Western Security Bank of Billings, First Bank of Montana of Lewistown; Mountain West Bank in Idaho, Utah and Washington; 1st Bank in Wyoming and Utah; First National Bank & Trust in Wyoming; Citizens Community Bank in Idaho; and Bank of the San Juans in Colorado.
This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about management's plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as "expects," "anticipates," "intends," "plans," "believes," "should," "projects," "seeks," "estimates" or words of similar meaning. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations in the forward-looking statements, including those set forth in this news release:
-- the risks associated with lending and potential adverse changes of the
credit quality of loans in the Company's portfolio, including as a
result of declines in the housing and real estate markets in its
geographic areas;
-- increased loan delinquency rates;
-- the risks presented by a continued economic downturn, which could
adversely affect credit quality, loan collateral values, other real
estate owned values, investment values, liquidity and capital levels,
dividends and loan originations;
-- changes in market interest rates, which could adversely affect the
Company's net interest income and profitability;
-- legislative or regulatory changes that adversely affect the Company's
business, ability to complete pending or prospective future
acquisitions, limit certain sources of revenue, or increase cost of
operations;
-- costs or difficulties related to the integration of acquisitions;
-- the goodwill recorded in connection with acquisitions could become
impaired, which may have an adverse impact on the Company's earnings and
capital;
-- reduced demand for banking products and services;
-- the risks presented by public stock market volatility, which could
adversely affect the Company's stock value and the ability to raise
capital in the future;
-- competition from other financial services companies in our markets; and
-- the Company's success in managing risks involved in the foregoing.
The Company does not undertake any obligation to publicly correct or update any forward-looking statement if we later become aware that it is not likely to be achieved.
Visit our website at www.glacierbancorp.com
Glacier Bancorp, Inc.
Consolidated Condensed Statements of Financial Condition
(Unaudited -$ in thousands
except per share data) June 30, December 31, June 30,
--------------------------
2010 2009 2009
---- ---- ----
Assets:
Cash on hand and in banks $95,603 120,731 100,773
Federal funds sold 71,605 87,155 62,405
Interest bearing cash
deposits 1,260 2,689 24,608
----- ----- ------
Cash and cash equivalents 168,468 210,575 187,786
Investment securities,
available-for-sale 1,743,268 1,506,394 994,147
Loans held for sale 73,207 66,330 92,166
Loans receivable, gross 3,958,962 4,063,915 4,036,593
Allowance for loan and
lease losses (141,665) (142,927) (97,374)
-------- -------- -------
Loans receivable, net 3,890,504 3,987,318 4,031,385
--------- --------- ---------
Premises and equipment, net 144,361 140,921 135,902
Other real estate owned 64,419 57,320 47,424
Accrued interest receivable 29,973 29,729 30,346
Deferred tax asset 35,361 41,082 14,890
Core deposit intangible,
net 12,316 13,937 11,477
Goodwill 146,259 146,259 146,259
Other assets 59,907 58,260 38,808
------ ------ ------
Total assets $6,294,836 6,191,795 5,638,424
========== ========= =========
Liabilities:
Non-interest bearing
deposits $852,121 810,550 754,844
Interest bearing deposits 3,657,995 3,289,602 2,631,599
Advances from Federal Home
Loan Bank 529,982 790,367 613,478
Securities sold under
agreements to repurchase 224,397 212,506 180,779
Federal Reserve Bank
discount window - 225,000 587,000
Other borrowed funds 10,063 13,745 17,192
Accrued interest payable 8,300 7,928 8,421
Subordinated debentures 125,060 124,988 120,157
Other liabilities 41,170 31,219 35,290
------ ------ ------
Total liabilities 5,449,088 5,505,905 4,948,760
--------- --------- ---------
Stockholders' equity:
Preferred shares, $.01 par
value per share. 1,000,000
shares authorized. None
issued or outstanding - - -
Common stock, $.01 par
value per share.
117,187,500
shares authorized 719 616 615
Paid-in capital 643,512 497,493 495,223
Retained earnings -
substantially restricted 192,724 188,129 196,208
Accumulated other
comprehensive income
(loss) 8,793 (348) (2,382)
----- ---- ------
Total stockholders' equity 845,748 685,890 689,664
------- ------- -------
Total liabilities and
stockholders' equity $6,294,836 6,191,795 5,638,424
========== ========= =========
Number of shares
outstanding 71,915,073 61,619,803 61,519,808
Book value of equity per
share 11.76 11.13 11.21
Glacier Bancorp, Inc.
Consolidated Condensed Statements of Operations
(Unaudited -$ in thousands except Three months ended
per share data) June 30,
---------------------------------- ------------------
2010 2009
---- ----
Interest income:
Residential real estate loans $11,421 13,871
Commercial loans 37,003 37,597
Consumer and other loans 10,720 11,142
Investment securities and other 14,674 11,810
------ ------
Total interest income 73,818 74,420
------ ------
Interest expense:
Deposits 9,222 9,433
Federal Home Loan Bank advances 2,454 1,852
Securities sold under agreements
to repurchase 399 409
Subordinated debentures 1,648 1,676
Other borrowed funds 26 569
--- ---
Total interest expense 13,749 13,939
------ ------
Net interest income 60,069 60,481
Provision for loan losses 17,246 25,140
------ ------
Net interest income after
provision for loan losses 42,823 35,341
------ ------
Non-interest income:
Service charges and other fees 10,641 10,215
Miscellaneous loan fees and
charges 1,259 1,162
Gain on sale of loans 6,133 9,071
Gain on sale of investments 242 -
Other income 3,143 870
----- ---
Total non-interest income 21,418 21,318
------ ------
Non-interest expense:
Compensation, employee benefits
and related expenses 21,652 20,710
Occupancy and equipment expense 5,988 5,611
Advertising and promotion expense 1,644 1,722
Outsourced data processing expense 761 680
Core deposit intangibles
amortization 801 762
Other real estate owned expense 7,373 2,321
Federal Deposit Insurance
Corporation premiums 2,165 3,832
Other expenses 7,852 7,325
----- -----
Total non-interest expense 48,236 42,963
------ ------
Earnings before income taxes 16,005 13,696
Federal and state income tax
expense 2,783 3,044
----- -----
Net earnings $13,222 10,652
======= ======
Basic earnings per share 0.19 0.17
Diluted earnings per share 0.19 0.17
Dividends declared per share 0.13 0.13
Return on average assets
(annualized) 0.85% 0.77%
Return on average equity
(annualized) 6.25% 6.18%
Average outstanding shares -basic 71,913,102 61,515,946
Average outstanding shares -
diluted 71,914,894 61,518,289
(Unaudited -$ in thousands except Six months ended
per share data) June 30,
---------------------------------- ----------------
2010 2009
---- ----
Interest income:
Residential real estate loans 23,254 28,212
Commercial loans 73,675 75,563
Consumer and other loans 21,360 22,481
Investment securities and other 28,927 23,696
------
Total interest income 147,216 149,952
------- -------
Interest expense:
Deposits 18,553 19,567
Federal Home Loan Bank advances 4,765 3,671
Securities sold under agreements
to repurchase 815 1,003
Subordinated debentures 3,284 3,583
Other borrowed funds 216 1,269
---
Total interest expense 27,633 29,093
------ ------
Net interest income 119,583 120,859
Provision for loan losses 38,156 40,855
------ ------
Net interest income after
provision for loan losses 81,427 80,004
------ ------
Non-interest income:
Service charges and other fees 20,161 19,234
Miscellaneous loan fees and
charges 2,385 2,322
Gain on sale of loans 10,024 15,221
Gain on sale of investments 556 -
Other income 4,475 1,918
-----
Total non-interest income 37,601 38,695
------ ------
Non-interest expense:
Compensation, employee benefits
and related expenses 43,008 42,654
Occupancy and equipment expense 11,936 11,506
Advertising and promotion expense 3,236 3,446
Outsourced data processing expense 1,455 1,351
Core deposit intangibles
amortization 1,621 1,536
Other real estate owned expense 9,691 2,841
Federal Deposit Insurance
Corporation premiums 4,365 5,000
Other expenses 14,885 14,255
------
Total non-interest expense 90,197 82,589
------ ------
Earnings before income taxes 28,831 36,110
Federal and state income tax
expense 5,539 9,679
-----
Net earnings 23,292 26,431
====== ======
Basic earnings per share 0.35 0.43
Diluted earnings per share 0.35 0.43
Dividends declared per share 0.26 0.26
Return on average assets
(annualized) 0.76% 0.96%
Return on average equity
(annualized) 6.02% 7.72%
Average outstanding shares -basic 67,363,476 61,489,422
Average outstanding shares -
diluted 67,364,377 61,493,266
Glacier Bancorp, Inc.
Average Balance Sheet
For the Three months ended
6/30/10
-------
(Unaudited -$ in
thousands) Interest Average
Average and Yield/
Assets: Balance Dividends Rate
------- --------- ----
Residential real estate
loans $768,174 $11,421 5.95%
Commercial loans 2,588,734 37,003 5.73%
Consumer and other loans 695,835 10,720 6.18%
------- ------
Total loans 4,052,743 59,144 5.85%
Tax -exempt investment
securities(1) 473,222 5,870 4.96%
Other investment
securities(2) 1,294,892 8,804 2.72%
--------- -----
Total Earning Assets 5,820,857 73,818 5.09%
------
Goodwill and core deposit
intangible 159,039
Non-earning assets 291,083
-------
Total assets $6,270,979
==========
Liabilities:
NOW accounts $714,714 $673 0.38%
Savings accounts 341,882 189 0.22%
Money market accounts 847,712 1,962 0.93%
Certificates accounts 1,080,561 5,183 1.92%
Wholesale deposits(3) 602,342 1,215 0.81%
Advances from FHLB 634,182 2,454 1.55%
Repurchase agreements
and other borrowed funds 352,840 2,073 2.36%
------- -----
Total interest bearing
liabilities 4,574,233 13,749 1.21%
------
Non-interest bearing
deposits 808,371
Other liabilities 39,645
------
Total Liabilities 5,422,249
---------
Stockholders' equity:
Common stock 719
Paid-in capital 643,395
Retained earnings 196,250
Accumulated other
comprehensive income 8,366
-----
Total stockholders' equity 848,730
-------
Total liabilities and
stockholders' equity $6,270,979
==========
Net interest income $60,069
=======
Net interest spread 3.88%
Net interest margin 4.14%
Net interest margin (tax-
equivalent) 4.35%
----
For the Six months ended
6/30/10
-------
(Unaudited -$ in
thousands) Interest Average
Average and Yield/
Assets: Balance Dividends Rate
------- --------- ----
Residential real estate
loans $775,634 $23,254 6.00%
Commercial loans 2,590,621 73,675 5.73%
Consumer and other loans 693,525 21,360 6.21%
------- ------
Total loans 4,059,780 118,289 5.88%
Tax -exempt investment
securities(1) 466,530 11,438 4.90%
Other investment
securities(2) 1,238,682 17,489 2.82%
--------- ------
Total Earning Assets 5,764,992 147,216 5.15%
-------
Goodwill and core deposit
intangible 159,443
Non-earning assets 279,947
-------
Total assets $6,204,382
==========
Liabilities:
NOW accounts $715,472 $1,406 0.40%
Savings accounts 336,807 393 0.24%
Money market accounts 829,746 3,925 0.95%
Certificates accounts 1,076,479 10,594 1.98%
Wholesale deposits(3) 488,388 2,235 0.92%
Advances from FHLB 717,628 4,765 1.34%
Repurchase agreements
and other borrowed funds 429,973 4,315 2.02%
------- -----
Total interest bearing
liabilities 4,594,493 27,633 1.21%
------
Non-interest bearing
deposits 794,263
Other liabilities 35,545
------
Total Liabilities 5,424,301
---------
Stockholders' equity:
Common stock 674
Paid-in capital 578,959
Retained earnings 194,954
Accumulated other
comprehensive income 5,494
-----
Total stockholders' equity 780,081
-------
Total liabilities and
stockholders' equity $6,204,382
==========
Net interest income $119,583
========
Net interest spread 3.94%
Net interest margin 4.18%
Net interest margin (tax-
equivalent) 4.39%
----
(1) Excludes tax effect of $5,064,000 and $2,599,000 on tax-
exempt investment security income for the
year-to-date and quarter ended June 30, 2010, respectively.
(2) Excludes tax effect of $709,000 and $397,000 on investment
security tax credits for the year-to-date
and quarter ended June 30, 2010, respectively.
(3) Wholesale deposits include brokered deposits classified as
NOW, money market demand, and CD's.
Glacier Bancorp, Inc.
Loan Portfolio - by Regulatory Classification
(Unaudited - $ in thousands)
Loans Receivable, Gross by Bank
-------------------------------
Balance Balance Balance
6/30/2010 12/31/2009 6/30/2009
--------- ---------- ---------
Glacier $893,809 942,254 965,399
Mountain West 916,582 957,451 989,371
First
Security 577,795 566,713 581,908
1st Bank 283,825 296,913 314,755
Western 316,893 323,375 349,150
Big Sky 266,540 270,970 285,515
Valley 194,521 187,283 195,662
First
National 152,970 153,058 -
Citizens 168,406 166,049 169,507
First Bank -
MT 116,920 117,017 125,184
San Juans 147,721 149,162 152,308
Eliminations (3,813) - -
Total $4,032,169 4,130,245 4,128,759
========== ========= =========
% Change % Change
from from
12/31/2009 6/30/2009
---------- ---------
Glacier -5% -7%
Mountain West -4% -7%
First
Security 2% -1%
1st Bank -4% -10%
Western -2% -9%
Big Sky -2% -7%
Valley 4% -1%
First
National 0% n/m
Citizens 1%Next Article: CRTC Announces Public Hearing to Consider Shaw's Acquisition of Control of Restructured Canwest
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