First Financial Corporation Reports 2nd Quarter Results
/EINPresswire.com/ -- TERRE HAUTE, IN --(Marketwired - July 25, 2016) - First Financial Corporation (NASDAQ: THFF) today announced results for the second quarter of 2016. Net income increased 18.9% to $8.2 million compared to $6.9 million for the same period of 2015. The increase was primarily driven by lower loan loss provisioning and lower benefits expense. Diluted net income per common share increased 25.9% to $0.68 from $0.54 for the comparable period of 2015.
The Corporation further reported net income of $21.9 million for the six months ended June 30, 2016 versus $14.7 million for the comparable period of 2015, an increase of 49.2%. Diluted net income per common share also increased 54.4% to $1.76 for the six months ended June 30, 2016 versus $1.14 for the comparable period of 2015. This increase included an after-tax gain on the sale of the Corporation's insurance subsidiary of $5.84 million during the first quarter of 2016. Return on assets for the six months ended June 30, 2016 was 1.48% compared to .98% for the six months ended June 30, 2015.
Norman L. Lowery, President and Chief Executive Officer, commented, "We are pleased with our second quarter 2016 results. We continue to see increases in our interest income, have lower credit costs, and increases in most areas of our non-interest income. It was a very well-rounded quarter."
Book value per share was $33.89 at June 30, 2016, a 9.0% increase from the $31.09 at June 30, 2016. Shareholders' equity increased 3.6% to $413.2 million from $399.1 million on June 30, 2015.
On February 3, 2016 the Corporation announced a stock repurchase plan to acquire 5% of the Corporation's outstanding common stock. During the second quarter of 2016 the corporation repurchased 72,174 shares as part of the repurchase plan, bringing the total shares repurchased to date to 558,174.
Average total loans for the second quarter of 2016 were $1.78 billion, an increase of $13.0 million or .7%, versus the $1.77 billion for the comparable period in 2015. Total loans outstanding were $1.80 billion, an increase from $1.78 billion as of June 30, 2015. On a linked quarter basis, average total loans increased $24.0 million, or 1.37%, from $1.76 billion for the quarter ending March 31, 2016.
Average total deposits for the quarter ended June 30, 2016 were $2.42 billion versus $2.46 billion as of June 30, 2015. On a linked quarter basis, average deposits increased $4 million to $2.42 billion for the quarter ending June 30, 2016.
The company's tangible common equity to tangible asset ratio was 12.89% at June 30, 2016, compared to 12.15% at June 30, 2015.
Net interest income for the second quarter of 2016 was $26.1 million compared to the $25.9 million reported for the same period of 2015. The net interest margin for the six months ended June 30, 2016 increased to 4.05% compared to the 4.00% reported at June 30, 2015.
The provision for loan losses for the three months ended June 30, 2016 was $435 thousand compared to $1.15 million for the second quarter of 2015. Net charge-offs were $856 thousand for the second quarter of 2016 compared to $938 thousand in the same period of 2015. The Corporation's allowance for loan losses as of June 30, 2016 was $19.5 million compared to $19.9 million as of June 30, 2015. The allowance for loan losses as a percent of total loans was 1.08% as of June 30, 2016 compared to 1.11% as of June 30, 2015.
Nonperforming loans decreased 23.1% to $27.6 million as of June 30, 2016 versus $35.8 million as of June 30, 2015. The ratio of nonperforming loans to total loans and leases was 1.53% as of June 30, 2016 versus 2.01% as of June 30, 2015.
Non-interest income for the three months ended June 30, 2016 was $8.2 million compared to $9.8 million as of June 30, 2015. The decline was primarily related to the sale of the Corporation's insurance subsidiary, which reduced insurance commissions by $1.9 million quarter-over-quarter.
Non-interest expense for the three months ended June 30, 2016 decreased $2.6 million to $22.8 million compared to $25.3 million in 2015. On a year-over-year basis, salaries and employee benefits decreased $3.4 million, driven by lower health insurance and pension expense. The Corporation's efficiency ratio was 53.69% for the six months ending June 30, 2016 versus 65.84% for the same period in 2015.
First Financial Corporation is the holding company for First Financial Bank N.A. in Indiana and Illinois, and The Morris Plan Company of Terre Haute.
Three Months Ended Six Months Ended
June 30, March 31, June 30, June 30, June 30,
2016 2016 2015 2016 2015
END OF PERIOD
BALANCES
Assets $2,958,016 $2,939,240 $2,973,821 $2,958,016 $2,973,821
Deposits $2,394,334 $2,400,655 $2,398,574 $2,394,334 $2,398,574
Loans $1,802,810 $1,763,659 $1,783,788 $1,802,810 $1,783,788
Allowance for Loan
Losses $ 19,504 $ 19,926 $ 19,861 $ 19,504 $ 19,861
Total Equity $ 413,224 $ 411,912 $ 399,058 $ 413,224 $ 399,058
Tangible Common
Equity $ 376,472 $ 375,000 $ 355,997 $ 376,472 $ 355,997
AVERAGE BALANCES
Total Assets $2,947,153 $2,959,007 $2,990,020 $2,953,080 $2,989,087
Earning Assets $2,747,214 $2,724,926 $2,760,188 $2,736,070 $2,754,459
Investments $ 945,948 $ 955,996 $ 977,537 $ 950,972 $ 973,426
Loans $1,781,201 $1,757,811 $1,768,758 $1,769,506 $1,764,641
Total Deposits $2,422,302 $2,418,668 $2,462,284 $2,420,485 $2,461,842
Interest-Bearing
Deposits $1,877,092 $1,873,070 $1,915,213 $1,875,081 $1,916,361
Interest-Bearing
Liabilities $ 44,852 $ 46,026 $ 43,413 $ 45,439 $ 44,101
Total Equity $ 406,382 $ 414,974 $ 407,387 $ 410,678 $ 404,405
INCOME STATEMENT DATA
Net Interest Income $ 26,059 $ 26,157 $ 25,924 $ 52,216 $ 51,919
Net Interest Income
Fully Tax
Equivalent $ 27,602 $ 27,692 $ 27,491 $ 55,293 $ 55,050
Provision for Loan
Losses $ 435 $ 835 $ 1,150 $ 1,270 $ 2,600
Non-interest Income $ 8,214 $ 21,484 $ 9,778 $ 30,580 $ 19,839
Non-interest
Expense $ 22,760 $ 22,465 $ 25,310 $ 46,107 $ 49,303
Net Income $ 8,232 $ 13,675 $ 6,923 $ 21,907 $ 14,684
PER SHARE DATA
Basic and Diluted
Net Income Per
Common Share $ 0.68 $ 1.08 $ 0.54 $ 1.76 $ 1.14
Cash Dividends
Declared Per
Common Share $ 0.50 $ - $ 0.49 $ 0.50 $ 0.49
Book Value Per
Common Share $ 33.89 $ 33.58 $ 31.09 $ 33.89 $ 31.09
Tangible Book Value
Per Common Share $ 30.88 $ 30.57 $ 28.23 $ 30.91 $ 27.74
Basic Weighted
Average Common
Shares Outstanding 12,236 12,646 12,903 12,441 12,925
Key Ratios Three Months Ended Six Months Ended
June 30, March 31, June 30, June 30, June 30,
2016 2016 2015 2016 2015
Return on average assets 1.12% 1.85% 0.93% 1.48% 0.98%
Return on average common
shareholder's equity 8.04% 13.28% 6.80% 10.67% 7.26%
Efficiency ratio 63.55% 45.68% 67.91% 53.69% 65.84%
Average equity to average
assets 13.89% 13.92% 13.62% 13.91% 13.53%
Net interest margin 4.04% 4.06% 3.99% 4.05% 4.00%
Net charge-offs to
average loans and leases 0.19% 0.19% 0.14% 0.19% 0.18%
Loan and lease loss
reserve to loans and
leases 1.08% 1.13% 1.11% 1.08% 1.11%
Loan and lease loss
reserve to nonperforming
loans and other real
estate 70.76% 84.38% 55.45% 70.76% 55.45%
Nonperforming loans to
loans 1.53% 1.50% 2.01% 1.53% 2.01%
Tier 1 leverage 13.08% 13.05% 12.62% 13.08% 12.62%
Risk-based capital - Tier
1 17.46% 17.81% 17.30% 17.46% 17.30%
Asset Quality Three Months Ended Six Months Ended
June 30, March 31, June 30, March 31, June 30,
2016 2016 2015 2016 2015
Accruing loans and
leases past due 30-89
days $ 7,435 $ 7,292 $ 5,193 $ 7,435 $ 5,193
Accruing loans and
leases past due 90 days
or more $ 1,044 $ 858 $ 690 $ 1,044 $ 690
Nonaccrual loans and
leases $ 14,526 $ 13,248 $ 16,553 $ 14,526 $ 16,553
Nonperforming loans $ 27,562 $ 23,615 $ 35,819 $ 27,562 $ 35,819
Other real estate owned $ 2,837 $ 2,850 $ 3,625 $ 2,837 $ 3,625
Total nonperforming
assets $ 38,998 $ 39,617 $ 50,630 $ 38,998 $ 50,630
Total troubled debt
restructurings $ 9,155 $ 9,509 $ 14,951 $ 9,155 $ 14,951
Gross charge-offs $ 1,842 $ 1,640 $ 1,823 $ 3,482 $ 3,302
Recoveries $ 986 $ 785 $ 885 $ 1,771 $ 1,724
Net charge-
offs/(recoveries) $ 856 $ 855 $ 938 $ 1,711 $ 1,578
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands, except per share data)
June 30, December 31,
2016 2015
---------- --------------
(unaudited)
-------------------------
ASSETS
Cash and due from banks $ 55,438 $ 88,695
Federal funds sold 5,500 9,815
Securities available-for-sale 876,538 891,082
Loans:
1,082,46
Commercial 1 1,043,980
Residential 430,082 444,447
Consumer 287,308 272,896
---------- --------------
1,799,85
1 1,761,323
(Less) plus:
Net deferred loan costs 2,959 2,485
Allowance for loan losses (19,504) (19,946)
---------- --------------
1,783,30
6 1,743,862
Restricted stock 10,848 10,838
Accrued interest receivable 10,869 11,733
Premises and equipment, net 49,353 50,531
Bank-owned life insurance 83,023 82,323
Goodwill 34,355 39,489
Other intangible assets 2,397 3,178
Other real estate owned 2,837 3,466
Other assets 43,552 44,573
---------- --------------
2,958,01
TOTAL ASSETS $ 6 $ 2,979,585
========== ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Non-interest-bearing $ 527,461 $ 563,302
Interest-bearing:
Certificates of deposit exceeding the FDIC
insurance limits 44,664 46,753
1,822,20
Other interest-bearing deposits 9 1,832,314
---------- --------------
2,394,33
4 2,442,369
Short-term borrowings 62,247 33,831
FHLB advances 10,828 12,677
Other liabilities 77,383 80,392
---------- --------------
2,544,79
TOTAL LIABILITIES 2 2,569,269
Shareholders' equity
Common stock, $.125 stated value per share;
Authorized shares-40,000,000
Issued shares-14,578,758 in 2016 and 14,557,815 in
2015
Outstanding shares-12,193,181 in 2016 and
12,740,018 in 2015 1,818 1,817
Additional paid-in capital 73,737 73,396
Retained earnings 411,423 395,633
Accumulated other comprehensive loss (3,493) (9,401)
Less: Treasury shares at cost-2,385,577 in 2016
and 1,817,797 in 2015 (70,261) (51,129)
---------- --------------
TOTAL SHAREHOLDERS' EQUITY 413,224 410,316
---------- --------------
2,958,01
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 6 $ 2,979,585
========== ==============
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Dollar amounts in thousands, except per share data)
Three Months Ended June
30, Six Months Ended June 30,
2016 2015 2016 2015
------------ ------------- ------------ -------------
(unaudited) (unaudited) (unaudited) (unaudited)
------------ ------------- ------------ -------------
INTEREST INCOME:
Loans, including
related fees $ 21,271 $ 20,763 $ 42,455 $ 41,570
Securities:
Taxable 3,694 3,991 7,525 8,052
Tax-exempt 1,818 1,790 3,640 3,569
Other 367 433 731 864
TOTAL INTEREST INCOME 27,150 26,977 54,351 54,055
------------ ------------- ------------ -------------
INTEREST EXPENSE:
Deposits 1,030 997 2,017 2,017
Short-term borrowings 26 19 49 32
Other borrowings 35 37 69 87
------------ ------------- ------------ -------------
TOTAL INTEREST EXPENSE 1,091 1,053 2,135 2,136
------------ ------------- ------------ -------------
NET INTEREST INCOME 26,059 25,924 52,216 51,919
Provision for loan
losses 435 1,150 1,270 2,600
------------ ------------- ------------ -------------
NET INTEREST INCOME
AFTER PROVISION
FOR LOAN LOSSES 25,624 24,774 50,946 49,319
NON-INTEREST INCOME:
Trust and financial
services 1,292 1,253 2,626 2,745
Service charges and
fees on deposit
accounts 2,601 2,543 5,105 4,869
Other service charges
and fees 3,149 3,000 6,149 5,838
Securities
gains/(losses), net 10 10 13 14
Insurance commissions 33 1,956 2,305 3,509
Gain on sale of
certain assets and
liabilities of
insurance brokerage
operation - - 13,021 -
Gain on sales of
mortgage loans 481 542 885 901
Other 648 474 476 1,963
------------ ------------- ------------ -------------
TOTAL NON-INTEREST
INCOME 8,214 9,778 30,580 19,839
------------ ------------- ------------ -------------
NON-INTEREST EXPENSE:
Salaries and employee
benefits 13,142 15,084 26,737 30,142
Occupancy expense 1,722 1,702 3,453 3,566
Equipment expense 1,808 1,702 3,645 3,474
FDIC Expense 403 450 854 880
Other 5,685 6,372 11,418 11,241
------------ ------------- ------------ -------------
TOTAL NON-INTEREST
EXPENSE 22,760 25,310 46,107 49,303
------------ ------------- ------------ -------------
INCOME BEFORE INCOME
TAXES 11,078 9,242 35,419 19,855
Provision for income
taxes 2,846 2,319 13,512 5,171
------------ ------------ ------------ -------------
NET INCOME 8,232 6,923 21,907 14,684
OTHER COMPREHENSIVE
INCOME
Change in unrealized
gains/losses on
securities, net of
reclassifications and
taxes 1,262 (7,564) 5,300 (2,802)
Change in funded
status of post
retirement benefits,
net of taxes 304 819 608 3,283
------------ ------------- ------------ -------------
COMPREHENSIVE INCOME $ 9,798 $ 178 $ 27,815 $ 15,165
============ ============= ============ =============
PER SHARE DATA
Basic and Diluted
Earnings per Share $ 0.68 $ 0.54 $ 1.76 $ 1.14
============ ============= ============ =============
Weighted average
number of shares
outstanding (in
thousands) 12,236 12,903 12,441 12,925
============ ============= ============ =============
FIRST FINANCIAL CORPORATION
One First Financial Plaza
Terre Haute, Indiana 47807
(812) 238-6000
For more information contact:
Rodger A. McHargue at (812) 238-6334
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