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Section 1: 8-K (8-K)


UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
 Pursuant to Section 13 or 15(d) of the
 Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  October 25, 2018

MACATAWA BANK CORPORATION
 (Exact name of registrant as specified in its charter)

 Michigan
 000-25927
 38-3391345
  (State or other jurisdiction of Incorporation)
  (Commission File Number)
  (I.R.S. Employer Identification No.)

 10753 Macatawa Drive, Holland, Michigan
 
 49424
(Address of principal executive offices)
 
  (Zip Code)

(616) 820-1444
 (Registrant's Telephone Number, Including Area Code)

Not Applicable
 (Former name or former address, if changed since last year)

          Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425).

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12).

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)).

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)).

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.



Item 2.02
Results of Operations and Financial Condition.

On October 25, 2018, Macatawa Bank Corporation issued the press release furnished with this report as Exhibit 99.1, which is here incorporated by reference. This report and the exhibit are furnished to, and not filed with, the Commission.

Item 9.01
Financial Statements and Exhibits.


(d)
Exhibits

       
   
Press Release dated October 25, 2018. This exhibit is furnished to, and not filed with, the Commission.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated:  October 25, 2018
MACATAWA BANK CORPORATION
   
 
By
/s/ Jon W. Swets
   
Jon W. Swets
Chief Financial Officer



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)


Exhibit 99.1

 

For Immediate Release
 
NASDAQ Stock Market:
MCBC
 

Macatawa Bank Corporation Reports
Third Quarter 2018 Results

HOLLAND, Mich. (October 25, 2018) – Macatawa Bank Corporation (NASDAQ: MCBC) today announced its results for the third quarter of 2018, reflecting continued strong financial performance.

·
Net income of $6.9 million in third quarter 2018 versus $4.9 million in third quarter 2017 – up 41%
·
Growth in net interest income primary driver of earnings improvement – up 15% from third quarter 2017
·
Loan portfolio balances and bond financing to businesses up by $98.7 million (8%), from September 30, 2017
·
Core deposit balances up by $111.6 million (7%), from September 30, 2017
·
Asset quality metrics remained strong

Macatawa reported net income of $6.9 million, or $0.20 per diluted share, in the third quarter 2018 compared to $4.9 million, or $0.14 per diluted share, in the third quarter 2017.  For the first nine months of 2018, Macatawa reported net income of $19.3 million, or $0.57 per diluted share, compared to $14.1 million, or $0.42 per diluted share, for the same period in 2017.  Macatawa’s 2018 earnings were positively impacted by continued earning asset growth, net interest margin improvement and a lower corporate federal income tax rate, due to tax reform enacted at the end of 2017.

"Operating trends noted in the first half of the year continued and strengthened into the third quarter of 2018,” said Ronald L. Haan, President and CEO of the Company.  “Revenue growth, primarily higher net interest income, along with a reduction in the federal corporate income tax rate and continued expense management resulted in a 41 percent increase in net income compared to the third quarter of 2017.  Growth in our balances of loans and bond financing to businesses, along with increases in market interest rates have positively affected our net interest income.  While net interest income grew by 15 percent, our core operating expenses, excluding problem asset costs, increased by less than 5 percent and have been on a decreasing trend throughout 2018.”

Mr. Haan concluded:  "We remain committed to providing excellent financial services while operating a well-disciplined company that delivers strong and consistent financial performance for our shareholders.  These results demonstrate that Macatawa Bank Corporation remains well-positioned for continued growth and success as we finish out 2018 and move into 2019.”


Macatawa Bank Corporation 3Q Results / page 2 of 5

Operating Results
Net interest income for the third quarter 2018 totaled $15.2 million, an increase of $509,000 from the second quarter 2018 and an increase of $2.0 million from the third quarter 2017.  Net interest margin was 3.37 percent, and was unchanged from the second quarter 2018, and up 16 basis points from the third quarter 2017.

Average interest earning assets for the third quarter 2018 increased $42.7 million from the second quarter 2018 and were up $147.6 million from the third quarter 2017.  This growth along with increases in yields on interest earning assets, primarily commercial loan yields, were the main contributors to the improvement in net interest income.

Non-interest income increased $31,000 in the third quarter 2018 compared to the second quarter 2018 and increased $199,000 from the third quarter 2017.  The increase from third quarter 2017 was due primarily to a net loss of $176,000 recognized in the third quarter 2017 on the sale of property in southwest Grand Rapids (Metro Village).  Gains on sales of mortgage loans continued its downward trend as overall mortgage volume was down in recent quarters, due primarily to increased market rates as well as shortage of housing inventory.  The Bank has also continued to experience a shift in more origination volume being held in portfolio as customers choose adjustable rate mortgage loans versus longer term fixed rate products.  The Bank holds adjustable rate mortgages in its porffolio and sells long-term fixed rate mortgages into the secondary market in order to appropriately manage the Bank’s interest rate risk.  For the nine month period ended September 30, 2018, gains on sales were down 50 percent compared to the same period in 2017 as volumes were higher in the early part of 2017.  Other categories of non-interest income were relatively consistent from quarter to quarter.

Non-interest expense was $11.2 million for the third quarter 2018, compared to $11.3 million for the second quarter 2018 and $10.8 million for the third quarter 2017.  The largest component of non-interest expense was salaries and benefit expenses.  Salaries and benefit expenses were down $29,000 compared to the second quarter 2018 and were up $149,000 compared to the third quarter 2017.  The increase compared to the third quarter 2017 was due to annual performance-related increases in salaries, partially offset by lower variable based compensation from mortgage production volume.

Nonperforming asset expenses increased $25,000 compared to the second quarter 2018 and increased $185,000 compared to the third quarter 2017.  The third quarter 2017 total was unusually low due to net gains on sales of foreclosed properties of $190,000, while net losses were incurred on sales in the third quarter 2018 and second quarter 2018.  Additionally, there were no writedowns on other real estate in the third quarter 2018 compared to $11,000 in second quarter 2018 and no writedowns in third quarter 2017.  Other categories of non-interest expense were relatively consistent compared to the second quarter 2018 and the third quarter 2017.

On December 22, 2017, “H.R.1”, formerly known as the “Tax Cuts and Jobs Act”, was signed into law.  This new tax law, among other items, reduced the Company’s federal corporate tax rate from 35 percent to 21 percent effective January 1, 2018. Since the enactment took place in December 2017, the Company revalued downward its net deferred tax assets in its reporting periods ended December 31, 2017 resulting in a $2.5 million increase to federal income tax expense in the fourth quarter 2017.


Macatawa Bank Corporation 3Q Results / page 3 of 5

Federal income tax expense was $1.6 million for the third quarter 2018 compared to $1.4 million for the second quarter 2018 and $2.2 million for the third quarter 2017.  The effective tax rate was 18.6 percent for the third quarter 2018, compared to 17.6 percent for the second quarter 2018 and 30.7 percent for the third quarter 2017.  The effective tax rate in the 2018 periods reflect the impact of the lower federal corporate tax rates from the enactment of the Tax Cuts and Jobs Act at the end of 2017.

Asset Quality
As a result of the consistent improvements in nonperforming loans and past due loans over the past several quarters, the continued low historical loan loss ratios, and net loan recoveries experienced in the third quarter 2018, no provision for loan losses was recorded in the third quarter 2018.  Net loan recoveries for the third quarter 2018 were $108,000, compared to second quarter 2018 net loan recoveries of $320,000 and third quarter 2017 net loan recoveries of $214,000.  The Company has experienced net loan recoveries in each of the past fifteen quarters. Total loans past due on payments by 30 days or more amounted to $492,000 at September 30, 2018, down 6 percent from $525,000 at June 30, 2018 and down 44 percent from $872,000 at September 30, 2017.  Delinquency as a percentage of total loans was 0.04 percent at September 30, 2018.

The allowance for loan losses of $16.8 million was 1.25 percent of total loans at September 30, 2018, compared to 1.26 percent of total loans at June 30, 2018, and 1.30 percent at September 30, 2017.  The coverage ratio of allowance for loan losses to nonperforming loans continued to be strong and significantly exceeded 1-to-1 coverage at 137-to-1 as of September 30, 2018.

At September 30, 2018, the Company's nonperforming loans had declined to $123,000, representing 0.01 percent of total loans.  This compares to $125,000 (0.01 percent of total loans) at June 30, 2018 and $521,000 (0.04 percent of total loans) at September 30, 2017.  Other real estate owned and repossessed assets were $3.5 million at September 30, 2018, compared to $3.9 million at June 30, 2018 and $6.7 million at September 30, 2017. Total nonperforming assets, including other real estate owned and nonperforming loans, have decreased by $3.6 million, or 50 percent, from September 30, 2017 to September 30, 2018.

A break-down of non-performing loans is shown in the table below.

 
Dollars in 000s
 
Sept 30,
2018
   
Jun 30,
2018
   
Mar 31,
2018
   
Dec 31,
2017
   
Sept 30,
2017
 
                               
Commercial Real Estate
 
$
121
   
$
121
   
$
121
   
$
385
   
$
440
 
Commercial and Industrial
   
---
     
2
     
201
     
4
     
4
 
Total Commercial Loans
   
121
     
123
     
322
     
389
     
444
 
Residential Mortgage Loans
   
2
     
2
     
2
     
2
     
58
 
Consumer Loans
   
---
     
---
     
---
     
4
     
19
 
Total Non-Performing Loans
 
$
123
   
$
125
   
$
324
   
$
395
   
$
521
 


Macatawa Bank Corporation 3Q Results / page 4 of 5

Total non-performing assets were $3.6 million, or 0.19 percent of total assets, at September 30, 2018.  A break-down of non-performing assets is shown in the table below.

 
Dollars in 000s
 
Sept 30,
2018
   
Jun 30,
2018
   
Mar 31,
2018
   
Dec 31,
2017
   
Sept 30,
2017
 
                               
Non-Performing Loans
 
$
123
   
$
125
   
$
324
   
$
395
   
$
521
 
Other Repossessed Assets
   
---
     
---
     
---
     
11
     
---
 
Other Real Estate Owned
   
3,465
     
3,872
     
5,223
     
5,767
     
6,661
 
Total Non-Performing Assets
 
$
3,588
   
$
3,997
   
$
5,547
   
$
6,173
   
$
7,182
 

Balance Sheet, Liquidity and Capital
Total assets were $1.92 billion at September 30, 2018, an increase of $46.7 million from $1.87 billion at June 30, 2018 and an increase of $116.2 million from $1.80 billion at September 30, 2017.  Total loans were $1.34 billion at September 30, 2018, an increase of $17.0 million from $1.33 billion at June 30, 2018 and an increase of $84.6 million from $1.26 billion at September 30, 2017.

Commercial loans increased by $71.4 million from September 30, 2017 to September 30, 2018, along with an increase of $15.3 million in our residential mortgage portfolio, partially offset by a decrease of $2.1 million in our consumer loan portfolio.  Commercial real estate loans increased by $22.6 million while commercial and industrial loans increased by $48.9 million during the same period.

The composition of the commercial loan portfolio is shown in the table below:

 
Dollars in 000s
 
Sept 30,
2018
   
Jun 30,
2018
   
Mar 31,
2018
   
Dec 31,
2017
   
Sept 30,
2017
 
                               
Construction and Development
 
$
93,794
   
$
85,193
   
$
81,948
   
$
92,241
   
$
84,659
 
Other Commercial Real Estate
   
459,146
     
461,808
     
447,922
     
449,694
     
445,703
 
Commercial Loans Secured by Real Estate
   
552,940
     
547,001
     
529,870
     
541,935
     
530,362
 
Commercial and Industrial
   
467,703
     
458,468
     
477,088
     
465,208
     
418,838
 
Total Commercial Loans
 
$
1,020,643
   
$
1,005,469
   
$
1,006,958
   
$
1,007,143
   
$
949,200
 

Bond financing to commercial customers increased by $14.1 million from September 30, 2017 to September 30, 2018.  This financing combined with the loan portfolio led to a total growth rate of 8 percent from September 30, 2017 to September 30, 2018.

Total deposits were $1.62 billion at September 30, 2018, up $37.3 million from $1.58 billion at June 30, 2018 and were up $111.6 million, or 7 percent, from $1.51 billion at September 30, 2017.  Demand deposits, money market deposits and certificates of deposit were all up in the third quarter 2018 compared to June 30, 2018 and September 30, 2017, while savings accounts were down in the third quarter 2018 compared to June 30, 2018 and were up compared to September 30, 2017.  The Bank continues to be successful at attracting and retaining core deposit customers, lessening its reliance on wholesale funding sources.  Customer deposit accounts remain insured to the highest levels available under FDIC deposit insurance.


Macatawa Bank Corporation 3Q Results / page 5 of 5

The Bank's risk-based regulatory capital ratios were higher at September 30, 2018 compared to June 30, 2018 and September 30, 2017 due to earnings growth, and continue to be at levels comfortably above those required to be categorized as “well capitalized” under applicable regulatory capital guidelines.  As such, the Bank was categorized as "well capitalized" at September 30, 2018.

About Macatawa Bank
Headquartered in Holland, Mich., Macatawa Bank offers a full range of banking, retail and commercial lending, wealth management and ecommerce services to individuals, businesses and governmental entities from a network of 26 full-service branches located throughout communities in Kent, Ottawa and northern Allegan counties.  The bank is recognized for its local management team and decision making, along with providing customers excellent service, a rewarding experience and superior financial products. Macatawa Bank has been recognized for the past eight consecutive years as one of “West Michigan’s 101 Best and Brightest Companies to Work For”. For more information, visit www.macatawabank.com.

CAUTIONARY STATEMENT:  This press release contains forward-looking statements that are based on management's current beliefs, expectations, assumptions, estimates, plans and intentions.  Forward-looking statements are identifiable by words or phrases such as “anticipates,” "believe," "expect," "may," "should," "will," ”intend,” "continue," "improving," "additional," "focus," "forward," "future," "efforts," "strategy," "momentum," "positioned," and other similar words or phrases.  Such statements are based upon current beliefs and expectations and involve substantial risks and uncertainties which could cause actual results to differ materially from those expressed or implied by such forward-looking statements.  These statements include, among others, statements related to trends in our key operating metrics and financial performance, future levels of earnings and profitability, future levels of earning assets, future asset quality, future growth, and future net interest margin.  All statements with references to future time periods are forward-looking.  Management's determination of the provision and allowance for loan losses, the appropriate carrying value of intangible assets (including deferred tax assets) and other real estate owned and the fair value of investment securities (including whether any impairment on any investment security is temporary or other-than-temporary and the amount of any impairment) involves judgments that are inherently forward-looking. Our ability to sell other real estate owned at its carrying value or at all, reduce non-performing asset expenses, utilize our deferred tax asset, reduce future tax liabilities, successfully implement new programs and initiatives, increase efficiencies, maintain our current level of deposits and other sources of funding, maintain liquidity, respond to declines in collateral values and credit quality, improve profitability, and produce consistent core earnings is not entirely within our control and is not assured.  The future effect of changes in the real estate, financial and credit markets and the national and regional economy on the banking industry, generally, and Macatawa Bank Corporation, specifically, are also inherently uncertain.  These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("risk factors") that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence.  Therefore, actual results and outcomes may materially differ from what may be expressed in or implied by such forward-looking statements. Macatawa Bank Corporation does not undertake to update forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

Risk factors include, but are not limited to, the risk factors described in "Item 1A - Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2017.  These and other factors are representative of the risk factors that may emerge and could cause a difference between an ultimate actual outcome and a preceding forward-looking statement.


MACATAWA BANK CORPORATION
CONSOLIDATED FINANCIAL SUMMARY
(Unaudited)
(Dollars in thousands except per share information)


   
Quarterly
   
Nine Months Ended
September 30
 
EARNINGS SUMMARY
 
3rd Qtr
2018
   
2nd Qtr
2018
   
3rd Qtr
2017
   
2018
   
2017
 
Total interest income
 
$
17,687
   
$
16,836
   
$
14,626
   
$
50,542
   
$
42,516
 
Total interest expense
   
2,525
     
2,183
     
1,488
     
6,544
     
4,090
 
Net interest income
   
15,162
     
14,653
     
13,138
     
43,998
     
38,426
 
Provision for loan losses
   
-
     
(300
)
   
(350
)
   
(400
)
   
(1,350
)
Net interest income after provision for loan losses
   
15,162
     
14,953
     
13,488
     
44,398
     
39,776
 
                                         
NON-INTEREST INCOME
                                       
Deposit service charges
   
1,132
     
1,060
     
1,172
     
3,242
     
3,342
 
Net gains on mortgage loans
   
270
     
222
     
369
     
633
     
1,273
 
Trust fees
   
889
     
945
     
801
     
2,759
     
2,412
 
Other
   
2,208
     
2,241
     
1,958
     
6,464
     
5,982
 
Total non-interest income
   
4,499
     
4,468
     
4,300
     
13,098
     
13,009
 
                                         
NON-INTEREST EXPENSE
                                       
Salaries and benefits
   
6,360
     
6,389
     
6,211
     
18,942
     
18,363
 
Occupancy
   
939
     
973
     
922
     
2,984
     
2,939
 
Furniture and equipment
   
760
     
773
     
797
     
2,338
     
2,278
 
FDIC assessment
   
127
     
132
     
134
     
391
     
404
 
Problem asset costs, including losses and (gains)
   
108
     
83
     
(77
)
   
652
     
(140
)
Other
   
2,945
     
2,909
     
2,769
     
8,625
     
8,590
 
Total non-interest expense
   
11,239
     
11,259
     
10,756
     
33,932
     
32,434
 
Income before income tax
   
8,422
     
8,162
     
7,032
     
23,564
     
20,351
 
Income tax expense
   
1,570
     
1,434
     
2,157
     
4,228
     
6,253
 
Net income
 
$
6,852
   
$
6,728
   
$
4,875
   
$
19,336
   
$
14,098
 
                                         
Basic earnings per common share
 
$
0.20
   
$
0.20
   
$
0.14
   
$
0.57
   
$
0.42
 
Diluted earnings per common share
 
$
0.20
   
$
0.20
   
$
0.14
   
$
0.57
   
$
0.42
 
Return on average assets
   
1.43
%
   
1.44
%
   
1.10
%
   
1.37
%
   
1.08
%
Return on average equity
   
15.12
%
   
15.23
%
   
11.34
%
   
14.54
%
   
11.17
%
Net interest margin (fully taxable equivalent)
   
3.37
%
   
3.37
%
   
3.21
%
   
3.36
%
   
3.24
%
Efficiency ratio
   
57.16
%
   
58.88
%
   
61.68
%
   
59.43
%
   
63.06
%

BALANCE SHEET DATA
Assets
 
September 30
2018
   
June 30
2018
   
September 30
2017
 
Cash and due from banks
 
$
30,837
   
$
37,105
   
$
28,318
 
Federal funds sold and other short-term investments
   
152,339
     
107,416
     
131,571
 
Debt securities available for sale
   
218,615
     
218,770
     
214,182
 
Debt securities held to maturity
   
71,688
     
79,569
     
61,927
 
Federal Home Loan Bank Stock
   
11,558
     
11,558
     
11,558
 
Loans held for sale
   
-
     
61
     
2,199
 
Total loans
   
1,344,683
     
1,327,686
     
1,260,037
 
Less allowance for loan loss
   
16,803
     
16,695
     
16,434
 
Net loans
   
1,327,880
     
1,310,991
     
1,243,603
 
Premises and equipment, net
   
45,631
     
45,907
     
46,822
 
Bank-owned life insurance
   
40,996
     
40,744
     
40,042
 
Other real estate owned
   
3,465
     
3,872
     
6,661
 
Other assets
   
16,264
     
16,548
     
16,163
 
                         
Total Assets
 
$
1,919,273
   
$
1,872,541
   
$
1,803,046
 
                         
Liabilities and Shareholders' Equity
                       
Noninterest-bearing deposits
 
$
500,680
   
$
496,605
   
$
497,310
 
Interest-bearing deposits
   
1,117,063
     
1,083,856
     
1,008,868
 
Total deposits
   
1,617,743
     
1,580,461
     
1,506,178
 
Other borrowed funds
   
70,000
     
65,667
     
72,118
 
Long-term debt
   
41,238
     
41,238
     
41,238
 
Other liabilities
   
6,316
     
5,461
     
10,048
 
Total Liabilities
   
1,735,297
     
1,692,827
     
1,629,582
 
                         
Shareholders' equity
   
183,976
     
179,714
     
173,464
 
                         
Total Liabilities and Shareholders' Equity
 
$
1,919,273
   
$
1,872,541
   
$
1,803,046
 


MACATAWA BANK CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(Unaudited)
(Dollars in thousands except per share information)


 
Quarterly
   
Year to Date
 
   
3rd Qtr
2018
   
2nd Qtr
2018
   
1st Qtr
2018
   
4th Qtr
2017
   
3rd Qtr
2017
   
2018
   
2017
 
EARNINGS SUMMARY
                                         
Net interest income
 
$
15,162
   
$
14,653
   
$
14,182
   
$
13,517
   
$
13,138
   
$
43,998
   
$
38,426
 
Provision for loan losses
   
-
     
(300
)
   
(100
)
   
-
     
(350
)
   
(400
)
   
(1,350
)
Total non-interest income
   
4,499
     
4,468
     
4,132
     
4,410
     
4,300
     
13,098
     
13,009
 
Total non-interest expense
   
11,239
     
11,259
     
11,434
     
11,253
     
10,756
     
33,932
     
32,434
 
Federal income tax expense
   
1,570
     
1,434
     
1,225
     
4,480
     
2,157
     
4,228
     
6,253
 
Net income
 
$
6,852
   
$
6,728
   
$
5,755
   
$
2,194
   
$
4,875
   
$
19,336
   
$
14,098
 
                                                         
Basic earnings per common share
 
$
0.20
   
$
0.20
   
$
0.17
   
$
0.06
   
$
0.14
   
$
0.57
   
$
0.42
 
Diluted earnings per common share
 
$
0.20
   
$
0.20
   
$
0.17
   
$
0.06
   
$
0.14
   
$
0.57
   
$
0.42
 
                                                         
MARKET DATA
                                                       
Book value per common share
 
$
5.41
   
$
5.28
   
$
5.16
   
$
5.10
   
$
5.11
   
$
5.41
   
$
5.11
 
Tangible book value per common share
 
$
5.41
   
$
5.28
   
$
5.16
   
$
5.10
   
$
5.11
   
$
5.41
   
$
5.11
 
Market value per common share
 
$
11.71
   
$
12.14
   
$
10.27
   
$
10.00
   
$
10.26
   
$
11.71
   
$
10.26
 
Average basic common shares
   
34,014,319
     
34,016,679
     
34,010,396
     
33,958,992
     
33,942,248
     
34,013,813
     
33,942,318
 
Average diluted common shares
   
34,014,319
     
34,016,679
     
34,011,592
     
33,965,344
     
33,947,269
     
34,014,209
     
33,948,419
 
Period end common shares
   
34,014,319
     
34,014,319
     
34,017,525
     
33,972,977
     
33,941,953
     
34,014,319
     
33,941,953
 
                                                         
PERFORMANCE RATIOS
                                                       
Return on average assets
   
1.43
%
   
1.44
%
   
1.25
%
   
0.49
%
   
1.10
%
   
1.37
%
   
1.08
%
Return on average equity
   
15.12
%
   
15.23
%
   
13.24
%
   
5.03
%
   
11.34
%
   
14.54
%
   
11.17
%
Net interest margin (fully taxable equivalent)
   
3.37
%
   
3.37
%
   
3.34
%
   
3.25
%
   
3.21
%
   
3.36
%
   
3.24
%
Efficiency ratio
   
57.16
%
   
58.88
%
   
62.43
%
   
62.77
%
   
61.68
%
   
59.43
%
   
63.06
%
Full-time equivalent employees (period end)
   
332
     
339
     
332
     
340
     
343
     
332
     
343
 
                                                         
ASSET QUALITY
                                                       
Gross charge-offs
 
$
30
   
$
30
   
$
97
   
$
45
   
$
55
   
$
156
   
$
221
 
Net charge-offs/(recoveries)
 
$
(108
)
 
$
(320
)
 
$
(175
)
 
$
(166
)
 
$
(214
)
 
$
(603
)
 
$
(822
)
Net charge-offs to average loans (annualized)
   
-0.03
%
   
-0.10
%
   
-0.05
%
   
-0.05
%
   
-0.07
%
   
-0.06
%
   
-0.09
%
Nonperforming loans
 
$
123
   
$
125
   
$
324
   
$
395
   
$
521
   
$
123
   
$
521
 
Other real estate and repossessed assets
 
$
3,465
   
$
3,872
   
$
5,223
   
$
5,778
   
$
6,661
   
$
3,465
   
$
6,661
 
Nonperforming loans to total loans
   
0.01
%
   
0.01
%
   
0.02
%
   
0.03
%
   
0.04
%
   
0.01
%
   
0.04
%
Nonperforming assets to total assets
   
0.19
%
   
0.21
%
   
0.30
%
   
0.33
%
   
0.40
%
   
0.19
%
   
0.40
%
Allowance for loan losses
 
$
16,803
   
$
16,695
   
$
16,675
   
$
16,600
   
$
16,434
   
$
16,803
   
$
16,434
 
Allowance for loan losses to total loans
   
1.25
%
   
1.26
%
   
1.26
%
   
1.26
%
   
1.30
%
   
1.25
%
   
1.30
%
Allowance for loan losses to nonperforming loans
   
13660.98
%
   
13356.00
%
   
5146.60
%
   
4202.53
%
   
3154.32
%
   
13660.98
%
   
3154.32
%
                                                         
CAPITAL
                                                       
Average equity to average assets
   
9.47
%
   
9.44
%
   
9.42
%
   
9.68
%
   
9.69
%
   
9.44
%
   
9.69
%
Common equity tier 1 to risk weighted assets (Consolidated)
   
12.13
%
   
11.83
%
   
11.67
%
   
11.31
%
   
11.70
%
   
12.13
%
   
11.70
%
Tier 1 capital to average assets (Consolidated)
   
11.90
%
   
11.91
%
   
11.83
%
   
11.88
%
   
12.04
%
   
11.90
%
   
12.04
%
Total capital to risk-weighted assets (Consolidated)
   
15.79
%
   
15.49
%
   
15.36
%
   
14.99
%
   
15.50
%
   
15.79
%
   
15.50
%
Common equity tier 1 to risk weighted assets (Bank)
   
14.28
%
   
14.01
%
   
13.87
%
   
13.54
%
   
13.99
%
   
14.28
%
   
13.99
%
Tier 1 capital to average assets (Bank)
   
11.56
%
   
11.58
%
   
11.50
%
   
11.56
%
   
11.72
%
   
11.56
%
   
11.72
%
Total capital to risk-weighted assets (Bank)
   
15.36
%
   
15.09
%
   
14.96
%
   
14.62
%
   
15.10
%
   
15.36
%
   
15.10
%
Tangible common equity to assets
   
9.59
%
   
9.60
%
   
9.42
%
   
9.15
%
   
9.63
%
   
9.59
%
   
9.63
%
                                                         
END OF PERIOD BALANCES
                                                       
Total portfolio loans
 
$
1,344,683
   
$
1,327,686
   
$
1,325,545
   
$
1,320,309
   
$
1,260,037
   
$
1,344,683
   
$
1,260,037
 
Earning assets
   
1,804,672
     
1,751,167
     
1,751,315
     
1,767,752
     
1,680,458
     
1,804,672
     
1,680,458
 
Total assets
   
1,919,273
     
1,872,541
     
1,863,780
     
1,890,232
     
1,803,046
     
1,919,273
     
1,803,046
 
Deposits
   
1,617,743
     
1,580,461
     
1,560,872
     
1,579,010
     
1,506,178
     
1,617,743
     
1,506,178
 
Total shareholders' equity
   
183,976
     
179,714
     
175,376
     
172,986
     
173,464
     
183,976
     
173,464
 
                                                         
AVERAGE BALANCES
                                                       
Total portfolio loans
 
$
1,325,268
   
$
1,327,408
   
$
1,314,838
   
$
1,285,688
   
$
1,252,075
   
$
1,322,543
   
$
1,258,940
 
Earning assets
   
1,799,600
     
1,756,909
     
1,730,576
     
1,681,297
     
1,652,028
     
1,762,614
     
1,609,143
 
Total assets
   
1,915,655
     
1,872,559
     
1,845,911
     
1,802,386
     
1,775,302
     
1,878,297
     
1,735,425
 
Deposits
   
1,614,151
     
1,575,408
     
1,537,376
     
1,497,213
     
1,481,539
     
1,575,926
     
1,433,277
 
Total shareholders' equity
   
181,329
     
176,749
     
173,913
     
174,427
     
171,987
     
177,358
     
168,209
 



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