WesBanco Inc.
01/27/2009 | Press release | Archived content
WesBanco Announces Results for 2008 and the Fourth Quarter
WHEELING, W.Va., Jan. 27 /PRNewswire-FirstCall/ -- Paul M. Limbert, President and Chief Executive Officer of WesBanco, Inc. (Nasdaq: WSBC), a Wheeling, West Virginia based multi-state bank holding company, today announced earnings for the fourth quarter and year ended December 31, 2008.
Net income for the year ended December 31, 2008 was $37.8 million while diluted earnings per common share were $1.42, as compared to $44.7 million or $2.09 per common share for 2007. Earnings per common share for 2008 included the full effect of the issuance of additional shares of stock for the purchase of Oak Hill Financial, Inc. ("Oak Hill") on November 30, 2007 and the accrual for the preferred stock dividend in December. Net interest income increased 34.6% in 2008 due to higher earning assets and a 24 basis point improvement in the net interest margin; however, the provision for credit losses increased $24.1 million. The provision exceeded net charge offs, therefore the allowance for loan losses increased $11.3 million to $49.8 million at December 31, 2008, or 1.38% of total loans. The margin improvements were due primarily to a decline in the cost of funds greater than earning asset yields as market rates dropped throughout the year, while the increase in the provision for credit losses was primarily due to general economic conditions, particularly in our Ohio markets, resulting in higher loan delinquencies, non-performing loans and net charge-offs. Total risk-based capital to risk-weighted assets increased to 14.78% at December 31, 2008, from 11.41% at December 31, 2007, which was enhanced in December by the issuance of $75 million in a new series of cumulative preferred stock. For the fourth quarter of 2008, net income after preferred dividends was $5.5 million, or $0.21 per common share, as compared to $10.7 million or $0.47 per common share in the 2007 fourth quarter.
"We are pleased with our operating results for the year 2008 given the difficult operating environment. Last week's announcement of the acquisition of five branches in the Columbus area will provide a greater opportunity to utilize our strong capital position, while also permitting expanded lending in our markets" said Mr. Limbert. "The net interest margin, and net interest income, have improved over the last year primarily as a result of our liability strategies and the acquisition of Oak Hill. We continue to successfully implement our Oak Hill integration efforts, reducing non-interest expense since the first quarter of 2008, which was the first full quarter of combined operations, and we are continuing to realize the cost savings from the Oak Hill transaction."
Highlights for the fourth quarter and year ended December 31, 2008 include the following:
-- On December 5, 2008, WesBanco consummated its issuance of preferred
stock and common stock warrants to the United States Treasury under the
Troubled Asset Relief Program ("TARP") Capital Purchase
Program ("CPP"). The voluntary program for healthy financial
institutions was created by the Treasury and signed into law in October
in order to increase the flow of financing available for businesses and
consumers through banks in support of the national economy, as well as
shore up bank capital positions in the face of a difficult economic
environment. On December 5, 2008, WesBanco issued to the U.S. Treasury
preferred stock in the aggregate amount of $75 million and warrants to
purchase 439,282 shares of the Company's common stock in accordance
with the terms of the CPP. WesBanco invested the proceeds into
mortgage-backed securities, and it is the Bank's intention over
time to reinvest the cash flows from these investments into commercial
and consumer loans. In the fourth quarter, commercial and commercial
real estate loans and home equity lines of credit increased by $43.7
million, which was partially offset by decreases in other loan
categories. WesBanco also addressed mortgage delinquency in owner
occupied residential and commercial loans by altering its policies to
permit more flexibility in dealing with customer defaults. The revised
policies provide more discretion to lenders in working with customers to
mitigate short term defaults and avoid unnecessary foreclosures.
-- Net interest income for 2008 increased 34.6% due to a 24 basis point
increase in the net interest margin to 3.68%, and a 24.0% increase in
average earning assets due to the acquisition of Oak Hill. The increase
in the net interest margin resulted from a 64 basis point decline in the
cost of interest bearing liabilities. This decrease in interest expense
rates was due to the effect on WesBanco's liability sensitive
balance sheet of generally declining interest rates over the past
eighteen months. The margin has also benefited from higher average
non-interest bearing deposit balances, as a percentage of total
deposits. For the fourth quarter, the net interest margin increased to
3.71% from 3.40% in 2007's same period, also due to lower interest
expense costs, which, combined with the increased balance sheet size,
provided a 28.6% increase in net interest income compared to the prior
year's quarter.
-- For 2008, non-interest income increased $4.4 million or 8.3%, primarily
due to the acquisition of Oak Hill. Service charges on deposits
increased from greater use of fee based services and the larger customer
base from Oak Hill, and ATM and debit card fees, as well as securities
and insurance brokerage revenue, increased during the year. These
increases were partially offset by a decrease of 8.2% in trust fees
primarily due to lower asset values and estate fees, although fee income
held up well considering the significant decrease in asset values
towards year-end. Losses on sales of OREO also increased in 2008 by $0.6
million. Losses and market write downs relating to fixed assets in 2008
were $0.5 million compared to gains of $0.9 million in 2007.
Non-interest income decreased 9.8% in the fourth quarter of 2008 as
compared to the same quarter in 2007 as asset losses, trust fee
decreases and lower mortgage banking income offset increases in deposit
account fee income.
-- The provision for credit losses in 2008 increased $24.1 million over
2007 to $32.6 million. However, as a result of the year-to-date
provision exceeding net charge offs by $11.3 million, the allowance for
loan losses as a percent of total loans increased from 1.04% as of
December 31, 2007 to 1.38% at December 31, 2008. This additional
provision is a reflection of changing economic conditions adversely
impacting our market areas which have caused net charge-offs, loan
delinquencies and non-performing loans to increase. Economic conditions
have generally worsened throughout the year and were exacerbated in the
fourth quarter by a sharp increase in unemployment, record declines in
the equity markets, and declining real estate values, particularly in
the Ohio metropolitan markets. For all of 2008, net charge offs were
0.58% of average loans as compared to 0.28% for 2007. The provision in
the fourth quarter of 2008 was $15.0 million as compared to $3.8 million
in the 2007 fourth quarter. For the 2008 fourth quarter, net
charge-offs were 0.96% of average loans as compared to 0.55% in the 2008
third quarter and 0.41% in the 2007 fourth quarter. Net charge-offs
were $8.7 million in the fourth quarter of 2008, and $21.3 million year
to date. Non-performing loans as a percent of total loans were 1.01% at
December 31, 2008, 0.96% at September 30, 2008 and 0.54% at December 31,
2007. In addition, loans past due 90 days or more and accruing were
$18.8 million or 0.52% of total loans at December 31, 2008, $12.3
million or 0.34% for the third quarter of 2008 and $11.5 million or
0.31% for the fourth quarter of 2007.
-- Throughout 2008, WesBanco has been integrating the operations and
systems of Oak Hill. As a result, total non-interest expense in the
fourth quarter of 2008 decreased 7.6% since the first quarter of 2008,
the first full quarter of combined operations. Non-interest expense for
all of 2008 increased 28.4% primarily due to increases in salaries,
benefits, facilities, merger and restructuring expenses of $3.9 million
and other normal operating costs, and were consistent with the 31.8%
increase in assets from September 30, 2007 to December 31, 2008, due
primarily to the acquisition. In addition, 2008 expenses included the
costs of operating two separate bank charters and back offices through
April, 2008, while reductions in Oak Hill staffing levels occurred
mostly in the second quarter. As a result of these and other staffing
changes, full time equivalent employees decreased 4.0% from 1,562 at
December 31, 2007 to 1,501 at the end of 2008. Occupancy and equipment
costs were affected during the period primarily by the acquisition, as
well as two new branch facilities opened in 2007 and recent technology
and other equipment upgrades. These increases were partially offset by
the sale of five former Oak Hill branches and the closing of two
additional branches during the second quarter of 2008. For the fourth
quarter, non-interest expenses increased 12.3% compared to the 2007
fourth quarter due to the acquisition, partially offset by integration
savings and other focused strategies to reduce costs in the face of a
deteriorating economy.
-- Total investments were substantially unchanged at December 31, 2008 as
compared to December 31, 2007, but were up from September 30, 2008 as a
result of the aforementioned initial use of the TARP proceeds. The
portfolio is primarily comprised of agency, agency mortgage-backed
securities and rated, insured state and municipal securities. WesBanco
has no exposure to government-sponsored enterprise preferred stocks and
collateralized debt obligations, and only an immaterial amount of
corporate debt and equity securities and non-agency collateralized
mortgage obligations. Total gross unrealized security losses within the
portfolio were a low $1.7 million or 0.2% of total available for sale
securities at December 31, 2008, while the total gross unrealized gain
on the available-for-sale portfolio increased from $11.9 million at
December 31, 2007 to $19.3 million at December 31, 2008.
-- Through December 31, 2008 portfolio loans decreased 3.1% compared to the
end of 2007 primarily due to the continued focus on maintaining
appropriate interest margins on new loans, continuing efforts to
maintain or improve credit quality, diminished lending in certain
consumer indirect loans and the Bank's strategy of reducing
existing residential mortgage loans and selling most new residential
mortgage loan originations. Portfolio loans increased $6.4 million in
the 2008 fourth quarter as compared to September 30, 2008, primarily
through some improvement in lending opportunities in the commercial
category and fewer prepayments of commercial real estate loans.
-- For all of 2008, total deposits decreased $404.0 million or 10.3%
compared to December 31, 2007. The decrease was primarily in
certificates of deposit and money market accounts as WesBanco attempted
to aggressively reduce its cost of funds and change its deposit mix in
the current volatile interest rate environment, while facing
irrationally high-rate competition in many of its markets. Total
deposits were slightly lower in the fourth quarter as compared to the
third quarter of 2008, decreasing 0.5%.
-- At December 31, 2008, FHLB borrowings increased $191.1 million or 47.1%
from December 31, 2007. The average cost of FHLB borrowings in the
fourth quarter of 2008 was 3.89%, as compared to 4.30% for the same
period in 2007. Throughout 2008, the Bank continued to manage deposit
rates, particularly in markets where larger banks are aggressively
pursuing higher cost CD's and MMDA's, and used more reasonably
priced wholesale term borrowings as part of its strategy to improve the
net interest margin.
-- The provision for income taxes decreased $3.5 million in 2008 due to a
decrease in pre-tax income and a decrease in the effective tax rate.
For 2008 the effective tax rate decreased to 10.5% as compared to 15.2%
in 2007 due primarily to a higher percentage of tax-exempt income to
total income, the benefit of certain tax credits including New Market
Tax Credits awarded to WesBanco Bank through the former Oak Hill Bank
and other adjustments related to a reduction of certain tax reserves
associated with uncertain tax positions and filed tax returns.
-- Total tangible equity to tangible assets increased to 7.90% at December
31, 2008 from 5.96% at December 31, 2007. Retention of earnings and the
December 2008 sale of preferred stock and warrants under the TARP
program and the lack of any repurchase of shares in 2008 contributed to
this improvement in the Bank's capital position. No shares other
than for certain benefit plans may be repurchased under the terms of the
CPP while such investment remains outstanding without permission from
the Treasury, and no dividend increases are permitted. The company
continues to post strong and improving regulatory capital ratios of
10.28% tier I leverage capital ratio, 13.53% tier I risk-based capital
ratio, and 14.78% total risk-based capital ratio. Historically, these
ratios for the company have exceeded the ratios of many peers and the
bank continues to maintain a well capitalized position as defined by
regulations. WesBanco is participating in the government senior
unsecured debt guarantee program and the FDIC insurance expansion to
certain non-interest bearing and interest-bearing demand deposits, since
these programs are available to all healthy financial institutions. No
decision has yet been made about the issuance of any new guaranteed
debt.
WesBanco entered into a purchase agreement with AmTrust Financial Corporation ("AmTrust") on January 21, 2009 to purchase all five of AmTrust's Columbus, Ohio branches. As part of the agreement, WesBanco will assume all of the deposit liabilities of approximately $600 million as of January 20, 2009, pay a deposit premium of approximately $20.9 million and buy or assume the leases of the related fixed assets of the branches. WesBanco will not acquire loans as part of the transaction, and will operate the acquired branches under the WesBanco Bank name, joining eight other Columbus area branches already owned by the Bank. The transaction will move WesBanco into the top ten in deposit market share in Columbus. Closing of the transaction, subject to certain regulatory approvals, is anticipated to occur late in the first quarter of 2009.
WesBanco is a multi-state bank holding company with total assets of approximately $5.2 billion, operating through 109 locations and 139 ATMs in West Virginia, Ohio, and Pennsylvania. WesBanco's banking subsidiary is WesBanco Bank, Inc., headquartered in Wheeling, West Virginia. WesBanco also operates an insurance brokerage company, WesBanco Insurance Services, Inc., and a full service broker/dealer, WesBanco Securities, Inc.
Forward-looking Statements
Forward-looking statements in this report relating to WesBanco's plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The information contained in this report should be read in conjunction with WesBanco's Form 10-K for the year ended December 31, 2007 and Form 10-Q as of September 30, 2008 filed with the Securities and Exchange Commission ("SEC"), which is available at the SEC's website www.sec.gov or at WesBanco's website, www.wesbanco.com. Investors are cautioned that forward-looking statements, which are not historical fact, involve risks and uncertainties, including those detailed in WesBanco's most recent Annual report on Form 10-K filed with the SEC under Part I, Item 1A. Risk Factors. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including without limitation, the effects of changing regional and national economic conditions; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to WesBanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, Federal Deposit Insurance Corporation, the SEC, the Financial Institution Regulatory Authority and other regulatory bodies; potential legislative and federal and state regulatory actions and reform; adverse decisions of federal and state courts; fraud, scams and schemes of third parties; internet hacking; competitive conditions in the financial services industry; rapidly changing technology affecting financial services, marketability of debt instruments and corresponding impact on fair value adjustments; regulatory approval and closing of the acquisition of the AmTrust branches; and/or other external developments materially impacting WesBanco's operational and financial performance. WesBanco does not assume any duty to update forward-looking statements.
WESBANCO, INC.
Consolidated Selected Financial Highlights
------------------------------------------
(unaudited, dollars in thousands, except per share amounts)
For the Three Months Ended
December 31,
------------
Statement of income 2008 2007 % Change
------------------- ---- ---- --------
Interest income $67,722 $63,928 5.93%
Interest expense 26,875 32,154 (16.42%)
------ ------ ------
Net interest income 40,847 31,774 28.55%
Provision for credit losses 15,044 3,832 292.59%
------ ----- ------
Net interest income after
provision for credit losses 25,803 27,942 (7.66%)
------ ------ -----
Non-interest income
Trust fees 3,181 4,048 (21.42%)
Service charges on deposits 6,084 5,348 13.76%
Net securities gains/(losses) 374 204 83.33%
Other income 2,851 4,242 (32.79%)
----- ----- ------
Total non-interest income 12,490 13,842 (9.77%)
Non-interest expense
Salaries and employee benefits 17,292 15,577 11.01%
Net occupancy 2,428 2,098 15.73%
Equipment 2,782 1,998 39.24%
Amortization of intangible
assets 939 704 33.38%
Marketing expense 1,210 1,115 8.52%
Merger and restructuring
expenses 701 635 10.39%
Other operating expenses 8,377 7,906 5.96%
----- ----- ----
Total non-interest expense 33,729 30,033 12.31%
------ ------ -----
Income before provision for
income taxes 4,564 11,751 (61.16%)
Provision for income taxes (1,257) 1,087 (215.64%)
------ ----- -------
Net income $5,821 $10,664 (45.41%)
====== ======= ======
Preferred dividends 293 - 100.00%
--- - ------
Net Income available to Common
Shareholders $5,528 $10,664 (48.16%)
====== ======= ======
Taxable equivalent net interest
income $42,792 $33,752 26.78%
Per common share data
---------------------
Net income available per common
share - basic $0.21 $0.47 (55.32%)
Net income available per common
share - diluted $0.21 $0.47 (55.32%)
Dividends declared $0.28 $0.275 1.82%
Book value (period end)
Tangible book value (period end)
Tangible common book value
(period end)
Average common shares
outstanding - basic 26,560,889 22,544,167 17.82%
Average common shares
outstanding - diluted 26,579,724 22,551,781 17.86%
Period end common shares
outstanding
Period end preferred shares
outstanding
Selected ratios
---------------
Return on average assets 0.42% 0.96% (55.84%)
Return on average equity 3.59% 9.09% (60.54%)
Return on average common equity 3.72% 9.09% (59.13%)
Yield on earning assets (1) 6.04% 6.63% (8.90%)
Cost of interest bearing
liabilities 2.65% 3.65% (27.40%)
Net interest spread (1) 3.39% 2.98% 13.76%
Net interest margin (1) 3.71% 3.40% 9.12%
Efficiency (1) 61.01% 63.10% (3.31%)
Average loans to average
deposits 101.75% 94.79% 7.35%
Annualized net loan charge-offs/
average loans 0.96% 0.41% 133.08%
Effective income tax rate (27.54%) 9.25% NM
For the Year Ended
December 31,
------------
Statement of income 2008 2007 % Change
------------------- ---- ---- --------
Interest income $281,766 $236,393 19.19%
Interest expense 121,229 117,080 3.54%
------- ------- ----
Net interest income 160,537 119,313 34.55%
Provision for credit losses 32,649 8,516 283.38%
------ ----- ------
Net interest income after
provision for credit losses 127,888 110,797 15.43%
------- ------- -----
Non-interest income
Trust fees 14,883 16,212 (8.20%)
Service charges on deposits 23,986 18,345 30.75%
Net securities gains/(losses) 1,556 943 65.01%
Other income 16,921 17,439 (2.97%)
------ ------ -----
Total non-interest income 57,346 52,939 8.32%
Non-interest expense
Salaries and employee benefits 72,124 57,401 25.65%
Net occupancy 10,462 7,969 31.28%
Equipment 10,968 7,656 43.26%
Amortization of intangible
assets 3,810 2,485 53.32%
Marketing expense 5,668 4,482 26.46%
Merger and restructuring
expenses 3,945 635 521.26%
Other operating expenses 35,647 30,418 17.19%
------ ------ -----
Total non-interest expense 142,624 111,046 28.44%
------- ------- -----
Income before provision for
income taxes 42,610 52,690 (19.13%)
Provision for income taxes 4,493 8,021 (43.98%)
----- ----- ------
Net income $38,117 $44,669 (14.67%)
======= ======= ======
Preferred dividends 293 - 100.00%
--- - ------
Net Income available to Common
Shareholders $37,824 $44,669 (15.32%)
======= ======= ======
Taxable equivalent net interest
income $168,359 $127,143 32.42%
Per common share data
---------------------
Net income available per common
share - basic $1.42 $2.09 (32.06%)
Net income available per common
share - diluted $1.42 $2.09 (32.06%)
Dividends declared $1.12 $1.10 1.82%
Book value (period end) $24.82 $21.86 13.56%
Tangible book value (period end) $14.74 $11.44 28.83%
Tangible common book value
(period end) $12.02 $11.44 5.03%
Average common shares
outstanding - basic 26,551,467 21,343,302 24.40%
Average common shares
outstanding - diluted 26,563,320 21,375,377 24.27%
Period end common shares
outstanding 26,560,889 26,547,073 0.05%
Period end preferred shares
outstanding 75,000 - 100.00%
Selected ratios
---------------
Return on average assets 0.72% 1.09% (33.58%)
Return on average equity 6.37% 10.63% (40.10%)
Return on average common equity 6.43% 10.63% (39.55%)
Yield on earning assets (1) 6.32% 6.61% (4.39%)
Cost of interest bearing
liabilities 2.96% 3.60% (17.78%)
Net interest spread (1) 3.36% 3.01% 11.63%
Net interest margin (1) 3.68% 3.44% 6.98%
Efficiency (1) 63.19% 61.66% 2.48%
Average loans to average
deposits 99.52% 95.28% 4.45%
Annualized net loan charge-offs/
average loans 0.58% 0.28% 108.17%
Effective income tax rate 10.54% 15.22% (30.72%)
(1) The yield on earning assets, net interest margin, net interest
spread and efficiency ratios are presented on a fully
taxable-equivalent (FTE) and annualized basis. The FTE basis
adjusts for the tax benefit of income on certain tax-exempt
loans and investments. WesBanco believes this measure to be the
preferred industry measurement of net interest income and
provides a relevant comparison between taxable and non-taxable
amounts.
NM - Not Meaningful
WESBANCO, INC.
Consolidated Selected Financial Highlights
------------------------------------------
(unaudited, dollars in thousands)
Balance sheet (period end) December 31,
-------------------------- ------------
Assets 2008 2007 % Change
---- ---- --------
Cash and due from banks $76,024 $128,855 (41.00)%
Due from banks - interest bearing 65,145 1,364 4,676.03
Fed Funds sold - 276 100.00
Securities 935,588 937,084 (0.16)
Loans held for sale 3,875 39,717 (90.24)
Portfolio Loans:
Commercial and commercial real
estate 2,209,925 2,188,216 0.99
Residential real estate 856,999 975,151 (12.12)
Consumer and home equity 537,385 557,182 (3.55)
------- ------- -----
Total portfolio loans 3,604,309 3,720,549 (3.12)
Allowance for loan losses (49,803) (38,543) 29.21
------- ------- -----
Net portfolio loans 3,554,506 3,682,006 (3.46)
--------- --------- -----
Premises and equipment, net 93,693 94,143 (0.48)
Goodwill 254,202 257,199 (1.17)
Core deposit intangible, net 13,681 19,531 (29.95)
Other assets 225,327 224,151 0.52
------- ------- ----
Total Assets $5,222,041 $5,384,326 (3.01)%
========== ========== =====
Liabilities and Shareholders'
Equity
Non-interest bearing demand
deposits $486,752 $519,287 (6.27)%
Interest bearing demand
deposits 429,414 416,470 3.11
Money market accounts 479,256 612,089 (21.70)
Savings deposits 423,830 440,358 (3.75)
Certificates of deposit 1,684,664 1,919,726 (12.24)
--------- --------- ------
Total deposits 3,503,916 3,907,930 (10.34)
--------- --------- ------
Federal Home Loan Bank
borrowings 596,890 405,798 47.09
Short-term borrowings 297,805 329,515 (9.62)
Junior subordinated debt 111,110 111,024 0.08
Other liabilities 52,964 49,740 6.48
Shareholders' equity (1) 659,356 580,319 13.62
------- ------- -----
Total Liabilities and
Shareholders' Equity $5,222,041 $5,384,326 (3.01)%
========== ========== =====
% Change
Balance sheet (period end) September 30, December 31, 2008
--------------------------
Assets 2008 to Sept. 30, 2008
---- -----------------
Cash and due from banks $109,364 (30.49)%
Due from banks - interest
bearing 17,464 273.02
Fed Funds sold - 100.00
Securities 867,414 7.86
Loans held for sale 5,165 (24.98)
Portfolio Loans:
Commercial and commercial real
estate 2,173,073 1.70
Residential real estate 881,695 (2.80)
Consumer and home equity 543,152 (1.06)
------- -----
Total portfolio loans 3,597,920 0.18
Allowance for loan losses (43,480) 14.54
------- -----
Net portfolio loans 3,554,440 -
--------- -
Premises and equipment, net 95,033 (1.41)
Goodwill 254,494 (0.11)
Core deposit intangible, net 14,620 (6.42)
Other assets 231,943 (2.85)
------- -----
Total Assets $5,149,937 1.40%
========== ====
Liabilities and Shareholders'
Equity
Non-interest bearing demand
deposits $489,309 (0.52)%
Interest bearing demand
deposits 442,478 (2.95)
Money market accounts 505,522 (5.20)
Savings deposits 429,502 (1.32)
Certificates of deposit 1,654,635 1.81
--------- ----
Total deposits 3,521,446 (0.50)
--------- -----
Federal Home Loan Bank
borrowings 613,142 (2.65)
Short-term borrowings 271,084 9.86
Junior subordinated debt 111,089 0.02
Other liabilities 47,790 10.83
Shareholders' equity (1) 585,386 12.64
------- -----
Total Liabilities and
Shareholders' Equity $5,149,937 1.40%
========== ====
Average balance sheet and
-------------------------
net interest margin analysis Three months ended December 31
---------------------------- 2008 2007
Average Average Average Average
Assets Balance Rate Balance Rate
------- ---- ------- ----
Due from banks - interest
bearing $40,819 2.36% $2,300 3.79%
Loans, net of unearned income 3,601,413 6.22% 3,115,398 6.86%
Securities:
Taxable 562,479 4.94% 462,911 5.18%
Tax-exempt 337,436 6.59% 337,413 6.65%
------- ---- ------- ----
Total securities 899,915 5.56% 800,324 5.80%
Federal funds sold 14,121 0.82% 9,814 4.85%
Other earning assets (2) 35,646 0.82% 22,103 5.94%
------ ---- ------ ----
Total earning assets 4,591,914 6.04% 3,949,939 6.63%
Other assets 595,932 476,134
------- -------
Total Assets $5,187,846 $4,426,073
========== ==========
Liabilities and
Shareholders' Equity
Interest bearing demand
deposits $445,687 0.66% $382,749 1.34%
Money market accounts 492,289 1.33% 467,236 2.85%
Savings deposits 425,248 0.59% 414,918 1.24%
Certificates of deposit 1,675,054 3.46% 1,597,720 4.67%
--------- ---- --------- ----
Total interest
bearing deposits 3,038,278 2.30% 2,862,623 3.43%
Federal Home Loan
Bank borrowings 605,953 3.89% 323,095 4.30%
Short-term borrowings 277,316 2.23% 211,460 4.31%
Junior subordinated debt 111,100 6.56% 95,519 6.62%
------- ---- ------ ----
Total interest
bearing liabilities 4,032,647 2.65% 3,492,697 3.65%
--------- ---- --------- ----
Non-interest bearing demand
deposits 501,087 423,863
Other liabilities 40,952 44,034
Shareholders' equity 613,160 465,479
------- -------
Total Liabilities and
Shareholders' Equity $5,187,846 $4,426,073
========== ==========
Taxable equivalent net
interest spread 3.39% 2.98%
==== ====
Taxable equivalent net
interest margin 3.71% 3.40%
==== ====
Average balance sheet and
-------------------------
net interest margin analysis For the year ended December 31,
---------------------------- 2008 2007
Average Average Average Average
Assets Balance Rate Balance Rate
------- ---- ------- ----
Due from banks - interest
bearing $35,702 2.71% $1,749 2.57%
Loans, net of unearned income 3,648,968 6.49% 2,906,197 6.85%
Securities:
Taxable 522,523 5.38% 414,792 4.99%
Tax-exempt 328,755 6.80% 334,332 6.68%
------- ---- ------- ----
Total securities 851,278 5.93% 749,124 5.75%
Federal funds sold 13,512 2.21% 16,005 5.19%
Other earning assets (2) 31,464 2.93% 21,766 5.59%
------ ---- ------ ----
Total earning assets 4,580,924 6.32% 3,694,841 6.61%
Other assets 643,518 405,956
------- -------
Total Assets $5,224,442 $4,100,797
========== ==========
Liabilities and
Shareholders' Equity
Interest bearing demand
deposits $433,661 1.11% $357,616 1.31%
Money market accounts 472,634 1.76% 395,017 2.75%
Savings deposits 504,335 0.61% 423,485 1.32%
Certificates of deposit 1,758,124 3.91% 1,481,014 4.60%
--------- ---- --------- ----
Total interest bearing
deposits 3,168,754 2.68% 2,657,132 3.36%
Federal Home Loan Bank
borrowings 520,636 3.97% 320,247 4.12%
Short-term borrowings 289,541 2.90% 181,539 4.82%
Junior subordinated debt 111,063 6.43% 89,623 6.53%
------- ---- ------ ----
Total interest bearing
liabilities 4,089,994 2.96% 3,248,541 3.60%
--------- ---- --------- ----
Non-interest bearing demand
deposits 497,681 393,040
Other liabilities 42,766 38,984
Shareholders' equity 594,001 420,232
------- -------
Total Liabilities and
Shareholders' Equity $5,224,442 $4,100,797
========== ==========
Taxable equivalent net
interest spread 3.36% 3.01%
==== ====
Taxable equivalent net
interest margin 3.68% 3.44%
==== ====
(1) Shareholders equity at December 31, 2008 includes preferred stock
and warrants issued to the U.S. Treasury in the amount of $72.3
million, net of discount, and $2.7 million, respectively.
(2) Federal Home Loan Bank stock and equity securities that do not have
readily determinable fair market values.
WESBANCO, INC.
Consolidated Selected Financial Highlights
------------------------------------------
(unaudited, dollars in thousands, except per share amounts)
Quarter Ended
-------------
Dec. 31, Sept. 30, June 30,
Statement of income 2008 2008 2008
------------------- ---- ---- ----
Interest income $67,722 $68,675 $70,588
Interest expense 26,875 28,388 29,929
------ ------ ------
Net interest income 40,847 40,287 40,659
Provision for credit losses 15,044 6,457 5,723
------ ----- -----
Net interest income after
provision for credit losses 25,803 33,830 34,936
------ ------ ------
Non-interest income
Trust fees 3,181 3,639 3,939
Service charges on deposits 6,084 6,280 6,020
Net securities gains 374 276 400
Other income 2,851 4,775 4,432
----- ----- -----
Total non-interest income 12,490 14,970 14,791
Non-interest expense
Salaries and employee benefits 17,292 18,042 18,223
Net occupancy 2,428 2,511 2,435
Equipment 2,782 2,739 2,862
Core deposit intangibles 939 950 908
Marketing expense 1,210 2,078 1,211
Merger and restructuring expenses 701 539 1,656
Other operating expenses 8,377 9,306 8,775
----- ----- -----
Total non-interest expense 33,729 36,165 36,070
------ ------ ------
Income before provision for income
taxes 4,564 12,635 13,657
Provision for income taxes (1,257) 1,126 2,373
------ ----- -----
Net income $5,821 $11,509 $11,284
====== ======= =======
Preferred dividends 293 - -
--- - -
Net Income available to Common
Shareholders $5,528 $11,509 $11,284
====== ======= =======
Taxable equivalent net interest
income $42,792 $42,220 $42,557
Per common share data
---------------------
Net income per common share - basic $0.21 $0.43 $0.42
Net income per common share -
diluted $0.21 $0.43 $0.42
Dividends declared $0.28 $0.28 $0.28
Book value (period end) $24.82 $22.04 $21.98
Tangible book value (period end) $14.74 $11.91 $11.79
Tangible common book value (period
end) $12.02 $11.91 $11.79
Average common shares outstanding -
basic 26,560,889 26,550,318 26,547,498
Average common shares outstanding -
diluted 26,579,724 26,561,874 26,553,724
Period end common shares outstanding 26,560,889 26,560,889 26,547,697
Period end preferred shares
outstanding 75,000 - -
Full time equivalent employees 1,501 1,519 1,539
Selected ratios
---------------
Return on average assets 0.42% 0.88% 0.87%
Return on average equity 3.59% 7.78% 7.67%
Return on average common equity 3.72% 7.78% 7.67%
Yield on earning assets (1) 6.04% 6.18% 6.40%
Cost of interest bearing liabilities 2.65% 2.80% 2.95%
Net interest spread (1) 3.39% 3.38% 3.45%
Net interest margin (1) 3.71% 3.70% 3.75%
Efficiency (1) 61.01% 63.24% 62.99%
Average loans to average deposits 101.75% 101.25% 98.52%
Trust Assets, market value at
period end $2,400,211 $2,732,514 $2,921,768
Quarter Ended
-------------
Mar 31, Dec. 31,
Statement of income 2008 2007
------------------- ---- ----
Interest income $74,693 $63,928
Interest expense 36,105 32,154
------ ------
Net interest income 38,588 31,774
Provision for credit losses 5,425 3,832
----- -----
Net interest income after
provision for credit losses 33,163 27,942
------ ------
Non-interest income
Trust fees 4,124 4,048
Service charges on deposits 5,586 5,348
Net securities gains 505 204
Other income 4,890 4,242
----- -----
Total non-interest income 15,105 13,842
Non-interest expense
Salaries and employee benefits 18,601 15,577
Net occupancy 2,967 2,098
Equipment 2,383 1,998
Core deposit intangibles 1,013 704
Marketing expense 1,170 1,115
Merger and restructuring expenses 1,047 635
Other operating expenses 9,333 7,906
----- -----
Total non-interest expense 36,514 30,033
------ ------
Income before provision for income
taxes 11,754 11,751
Provision for income taxes 2,251 1,087
----- -----
Net income $9,503 $10,664
====== =======
Preferred dividends - -
- -
Net Income available to Common
Shareholders $9,503 $10,664
====== =======
Taxable equivalent net interest
income $40,634 $33,752
Per common share data
---------------------
Net income per common share - basic $0.36 $0.47
Net income per common share -
diluted $0.36 $0.47
Dividends declared $0.280 $0.275
Book value (period end) $22.15 $21.86
Tangible book value (period end) $11.81 $11.44
Tangible common book value (period
end) $11.81 $11.44
Average common shares outstanding -
basic 26,547,073 22,544,167
Average common shares outstanding -
diluted 26,556,104 22,551,781
Period end common shares outstanding 26,547,073 26,547,073
Period end preferred shares
outstanding - -
Full time equivalent employees 1,566 1,562
Selected ratios
---------------
Return on average assets 0.72% 0.96%
Return on average equity 6.55% 9.09%
Return on average common equity 6.55% 9.09%
Yield on earning assets (1) 6.58% 6.63%
Cost of interest bearing liabilities 3.45% 3.65%
Net interest spread (1) 3.13% 2.98%
Net interest margin (1) 3.48% 3.40%
Efficiency (1) 65.46% 63.10%
Average loans to average deposits 96.74% 94.79%
Trust Assets, market value at
period end $2,951,052 $3,084,145
(1) The yield on earning assets, net interest margin, net interest
spread and efficiency ratios are presented on a fully
taxable-equivalent (FTE) and annualized basis. The FTE basis adjusts
for the tax benefit of income on certain tax-exempt loans and
investments. WesBanco believes this measure to be the preferred
industry measurement of net interest income and provides a relevant
comparison between taxable and non-taxable amounts.
WESBANCO, INC.
Consolidated Selected Financial Highlights
------------------------------------------
(unaudited, dollars in thousands)
Quarter Ended
-------------
Dec. 31, Sept. 30, June 30,
Asset quality data 2008 2008 2008
------------------ ---- ---- ----
Non-performing assets:
Non-accrual loans $31,737 $34,384 $29,660
Renegotiated loans 4,559 - -
----- - -
Total non-performing
loans 36,296 34,384 29,660
Other real estate and
repossessed assets 2,554 2,800 2,751
----- ----- -----
Total non-performing
assets $38,850 $37,184 $32,411
Loans past due 90 days or
more and accruing 18,810 12,274 15,213
Loans past due 30 - 89 days 35,606 34,973 33,780
------ ------ ------
Total non-performing
assets and loans past
due $93,266 $84,431 $81,404
======= ======= =======
Loans past due 30 - 89 days/
total loans 0.99% 0.97% 0.93%
Loans past due 90 days or
more and accruing/total loans 0.52% 0.34% 0.42%
---- ---- ----
Total loans past due and
accruing/total loans 1.51% 1.31% 1.35%
Non-performing loans/total
loans 1.01% 0.96% 0.82%
---- ---- ----
Non-performing loans and
loans past due/total loans 2.52% 2.27% 2.16%
==== ==== ====
Non-performing assets/total
loans, other real estate and
repossessed assets 1.08% 1.03% 0.89%
Non-performing loans and loans
past due 90 days or more/
total loans 1.53% 1.30% 1.23%
Allowance for loan losses
-------------------------
Allowance for loan losses $49,803 $43,480 $41,852
Provision for loan losses 15,000 6,549 5,700
Net loan charge-offs 8,652 4,947 4,087
Annualized net loan charge-
offs /average loans 0.96% 0.55% 0.45%
Allowance for loan losses/
total loans 1.38% 1.21% 1.15%
Allowance for loan losses/
non-performing loans 1.37x 1.26x 1.41x
Allowance for loan losses/
non-performing loans and
past due 90 days or more 0.90x 0.93x 0.93x
Quarter Ended
-------------
Mar. 31, Dec. 31,
Asset quality data 2008 2007
------------------ ---- ----
Non-performing assets:
Non-accrual loans $26,530 $19,858
Renegotiated loans - -
- -
Total non-performing
loans 26,530 19,858
Other real estate and
repossessed assets 3,457 3,998
----- -----
Total non-performing
assets $29,987 $23,856
Loans past due 90 days or
more and accruing 14,000 11,526
Loans past due 30 - 89 days 43,819 40,798
------ ------
Total non-performing
assets and loans past
due $87,806 $76,180
======= =======
Loans past due 30 - 89 days/
total loans 1.20% 1.10%
Loans past due 90 days or
more and accruing/total loans 0.38% 0.31%
---- ----
Total loans past due and
accruing/total loans 1.58% 1.41%
Non-performing loans/total
loans 0.72% 0.53%
---- ----
Non-performing loans and
loans past due/total loans 2.30% 1.94%
==== ====
Non-performing assets/total
loans, other real estate and
repossessed assets 0.82% 0.64%
Non-performing loans and
loans past due 90 days or
more/total loans 1.11% 0.85%
Allowance for loan losses
-------------------------
Allowance for loan losses $40,234 $38,543
Provision for loan losses 5,275 3,807
Net loan charge-offs 3,584 3,316
Annualized net loan charge-
offs /average loans 0.39% 0.41%
Allowance for loan losses/
total loans 1.10% 1.04%
Allowance for loan losses/
non-performing loans 1.52x 1.94x
Allowance for loan losses/
non-performing loans and
past due 90 days or more 0.99x 1.23x
Quarter Ended
-------------
Dec. 31, Sept. 30, June 30,
2008 2008 2008
---- ---- ----
Capital ratios
--------------
Tier I leverage
capital 10.28% 8.81% 8.63%
Tier I risk-based
capital 13.53% 11.36% 11.17%
Total risk-based
capital 14.78% 12.51% 12.28%
Shareholders'
equity to assets 11.82% 11.37% 11.34%
Tangible equity
to tangible
assets (1) 7.90% 6.48% 6.29%
Tangible common
equity to
tangible assets (1) 6.44% 6.48% 6.29%
Mar. 31, Dec. 31,
2008 2007
---- ----
Capital ratios
--------------
Tier I leverage
capital 7.87% 9.90%
Tier I risk-based
capital 10.90% 10.43%
Total risk-based
capital 11.96% 11.41%
Shareholders'
equity to assets 10.96% 10.35%
Tangible equity
to tangible
assets (1) 6.23% 5.96%
Tangible common
equity to
tangible assets (1) 6.23% 5.96%
(1) Tangible equity is defined as shareholders' equity less goodwill
and other intangible assets, and tangible assets are defined as
total assets less goodwill and other intangible assets. Tangible
common equity also excludes preferred stock, net of discount.
The calculation is based on period end balances.
SOURCE WesBanco, Inc.
Contact: Paul M. Limbert, President and Chief Executive Officer, or Robert H. Young, Executive Vice President and Chief Financial Officer, both of WesBanco, Inc., +1-304-234-9000