1st Quarter 2002 Highlights:
-- Record EPS of $.45 vs. $.38 Last Year
-- Record ROAA of 1.55% vs. 1.36% Last Year
-- ROAE of 19.4% vs. 17.1% Last Year
-- Net Interest Margin of 4.32% vs. 3.77% Last Year
-- Record Efficiency Ratio of 47.3% vs. 51.4% Last Year
-- Nonperforming Loans Down 9% Linked-Quarter
ITASCA, Ill., April 17 /PRNewswire-FirstCall/ -- First Midwest Bancorp,
Inc. (Nasdaq: FMBI) today reported net income for first quarter ended
March 31, 2002 increased to a record $22.1 million, or $.45 per diluted share,
as compared to 2001's like quarter of $19.3 million, or $.38 per diluted
share, representing an increase of 18.4% on a diluted share basis.
Performance for the current quarter resulted in record annualized return on
average assets of 1.55% as compared to 1.36% for the like quarter of 2001 and
annualized return on average equity of 19.4% as compared to 17.1% for the 2001
quarter. The elimination of goodwill amortization expense resulting from
implementation of Financial Accounting Standard #142 (effective January 1,
2002) added $.5 million (after tax) or $.01 per share to first quarter 2002
net income and diluted earnings per share, respectively.
Cash basis diluted earnings (which excludes amortization of goodwill and
core deposit intangibles resulting from acquisitions) increased to $.45 per
share for first quarter 2002 as compared to 2001's $.39 per share,
representing an increase of 15.4%. On a cash basis, the annualized return on
average assets (which excludes from average assets goodwill and core deposit
intangibles) was 1.57% for first quarter 2002 as compared to 2001's 1.41%,
while annualized return on average equity for first quarter 2002 was 19.5% as
compared to 2001's 17.7%.
Continued Strong Net Interest Margin
Net interest margin for first quarter 2002 was 4.32%, a 55 basis point
improvement over the 3.77% for 2001's like quarter. With the yield curve
remaining steep through first quarter 2002, net interest margin was stable and
essentially unchanged from the 4.33% earned in fourth quarter 2001.
Anticipating that the next move in interest rates is likely to be upward, the
Company undertook certain steps in first quarter 2002 intended to insulate net
interest income against a flattening of the yield curve. These steps included
a reduction in liability sensitivity of the balance sheet through the
lengthening of liabilities (primarily time deposits) and the move to a more
neutral balance sheet position as a result of reinvestment of cash flows from
mortgage-backed securities into short maturity securities. Although these
strategies have slowed the upward momentum in net interest margin achieved
over the last 5 quarters, the Company believes they will stabilize future
performance in this key component of the income statement.
Loan Growth and Funding
Total average loans for first quarter 2002 were 3.1% higher than the prior
year's like quarter averages with all loan categories except 1-4 family real
estate experiencing growth. On a linked-quarter basis, however, loan growth
was essentially flat with improvement in the commercial and real estate
construction portfolios being offset by decreases in 1-4 family real estate
and indirect consumer loans. Nonetheless, it appears that loan growth has
stabilized in first quarter 2002 after dropping by 2.2% in fourth quarter 2001
as compared to the third quarter of that year.
Total deposits for first quarter 2002 were basically unchanged from the
prior year's like quarter and decreased modestly on a linked-quarter basis,
both in terms of period-end and average balances. Wholesale funding increased
during first quarter 2002 as a result of a $200 million securities purchase
funded with a combination of repurchase agreements and Federal Home Loan Bank
advances. This transaction was initiated to take advantage of the historic
steepness in the long end of the yield curve during the quarter and is
expected to result in a positive spread of approximately 128 basis points.
Noninterest Income and Expense
Excluding net security gains realized in first quarter 2001, total
noninterest income was essentially flat for first quarter 2002 as compared to
the prior year's like quarter. Continued improvement was seen in service
charges on deposit accounts and other income while trust fees and other
service charges showed more modest gains. Corporate owned life insurance
income decreased by approximately 25% in first quarter 2002 as compared to the
prior year's like quarter and by approximately 14% on a linked-quarter basis.
The decrease in the 2002 quarter was related to the renegotiation in first
quarter 2001 of certain of the underlying insurance contracts through the
establishment of a stable value insurance contract enhancement as well as a
shortening in the duration of the underlying assets undertaken to provide
stability to this income stream. This redeployment into shorter duration
assets combined with the accelerated decrease in market interest rates that
occurred during the third and fourth quarters of 2001 resulted in the lower
level of income being credited on the life insurance assets in 2002's first
quarter.
Factoring out the elimination of goodwill amortization expense referred to
previously, total noninterest expenses for first quarter 2002 were 3.2% above
the prior year's like quarter but decreased 1.3% on a linked-quarter basis.
Salaries and benefits increased by approximately 6% in first quarter 2002 over
2001's like quarter due primarily to general salary increases and higher
healthcare insurance costs. This increase was offset by decreases in
occupancy, equipment and technology costs, with other expenses remaining
essentially flat.
As a result of top line revenue growth from net interest income and
continued strong cost controls, the efficiency ratio for first quarter 2002
dropped to a record 47.3% as compared to 51.4% for 2001's like quarter and
49.7% for full year 2001.
Credit Quality
Nonperforming loans continued to improve in first quarter 2002, dropping
9% on a linked-quarter basis and 32% as compared to the like quarter-end a
year ago. As a consequence, nonperforming loans declined at March 31, 2002 to
.45% of loans from .50% at year-end 2001 and .68% at the end of first quarter
2001. Reflecting further credit quality improvement, loans 90 days or more
past due decreased by over $1 million on a linked-quarter basis.
Net charge-offs for first quarter 2002 were .61% of average loans as
compared to .39% for the 2001 like quarter but improved from .73% on a linked-
quarter basis. Provisions for loan losses fully covered net charge-offs for
first quarter 2002 resulting in the ratio of the reserve for loan losses to
total loans at quarter-end being maintained at 1.42%, the same level as year-
end 2001.
As a consequence of the general improvement in credit quality, the reserve
for loan losses at March 31, 2002 represented 313% of nonperforming loans as
compared to 202% at the end of 2001's first quarter and 283% at year-end 2001.
Capital Management
The Company continued to repurchase its common stock during first quarter
2002 with approximately 428,000 shares being repurchased at an average price
of approximately $28.44 per share. During 2001 approximately 2.6 million
shares were repurchased at an average price of $24.80 per share. At March 31,
2002 approximately 1.5 million shares remained under the current 3.1 million
share repurchase authorization of August 15, 2001. All share repurchases
during first quarter 2002 were effected from general operating funds and at
March 31, 2002 the Company continued to have no short or long term debt.
As of March 31, 2002 the Company's Total Risk Based Capital and Tier 1
Risk Based Capital ratios were 11.05% and 9.94%, respectively, compared with
the minimum "well capitalized" levels for regulatory purposes of 10% and 6%,
respectively. The Company's Tier 1 Leverage Ratio as of such date was 7.45%
and exceeded the regulatory minimum range of 3% - 5% required to be considered
a "well capitalized" institution. As of March 31, 2002 First Midwest had
capital of approximately $45 million in excess of the most restrictive
regulatory minimum capital level to be considered a "well capitalized"
institution.
Outlook for Balance of 2002
The Company remains cautiously optimistic about its 2002 prospects even as
significant economic uncertainties continue, the consequences of September
11th evolve and the recent events in the Middle East unfold. As such, the
Company is comfortable with the consensus estimate's implied 11-12% growth in
2002 diluted earnings per share being achieved on a level basis over the
remainder of the year. This guidance is qualified by existent uncertainties,
consequences and unfolding events as well as unknown factors that could
negatively affect performance.
About the Company
With assets of approximately $6 billion, First Midwest is the largest
independent and one of the overall largest banking companies in the highly
attractive suburban Chicago banking market. As the premier independent
suburban Chicago banking company, First Midwest provides commercial banking,
trust, investment management and related financial services to a broad array
of customers through 69 offices located in more than 40 communities primarily
in northern Illinois.
Safe Harbor Statement
Statements made in this Press Release which are not purely historical are
forward-looking statements with respect to the goals, plan objectives,
intentions, expectations, financial condition, results of operations, future
performance and business of First Midwest, including, without limitation, (i)
loan and deposit growth, net interest income and margin, wholesale funding
sources, provision and reserve for loan losses, nonperforming loan levels and
net charge-offs, noninterest income and expenses, and diluted earnings per
share growth rates for 2001, and (ii) statements preceded by, followed by or
that include the words "may", "would", "could", "should", "expects",
"projects", "anticipates", "believes", "estimates", "plans", "intends",
"targets" or similar expressions.
Forward-looking statements involve inherent risks and uncertainties, and
important factors (many of which are beyond First Midwest's control) that
could cause actual results to differ materially from those set forth in the
forward-looking statements, including the following, in addition to those
contained in First Midwest's reports on file with the Securities and Exchange
Commission: general economic or industry conditions, nationally and/or in the
communities in which First Midwest conducts business, changes in the interest
rate environment, legislation or regulatory requirements, conditions of the
securities markets, deposit flows, cost of funds, demand for loan products,
demand for financial services, competition, changes in the quality or
composition of First Midwest's loan and investment portfolios, changes in
accounting principals, policies or guidelines, financial or political
instability, acts of war or terrorism, other economic, competitive,
governmental, regulatory and technical factors affecting First Midwest's
operations, products, services and prices.
Accordingly, results actually achieved may differ materially from expected
results in these statements. Forward-looking statements speak only as of the
date they are made. First Midwest does not undertake, and specifically
disclaims, any obligation to update any forward-looking statements to reflect
events or circumstances occurring after the date of such statements.
Accompanying Financial Statements and Tables
Accompanying this press release is the following unaudited financial
information:
-- Operating Highlights, Balance Sheet Highlights and Stock Performance
Data
-- Condensed Consolidated Statements of Condition
-- Condensed Consolidated Statements of Income
-- Selected Quarterly Data and Asset Quality
Press Release and Additional Information Available on Website
This press release, the accompanying financial statements and tables and
certain additional unaudited selected financial information (totaling 3 pages)
are available through the "Investor Relations" section of First Midwest's
website at http://www.firstmidwest.com .
First Midwest Bancorp, Inc. Press Release Dated April 17, 2002
Operating Highlights Quarters Ended
Unaudited March 31,
(Amounts in thousands except per
share data) 2002 2001
Net income $22,071 $19,324
Diluted earnings per share $0.45 $0.38
Return on average equity 19.39% 17.06%
Return on average assets 1.55% 1.36%
Net interest margin 4.32% 3.77%
Efficiency ratio 47.26% 51.35%
Balance Sheet Highlights
Unaudited
(Amounts in thousands except per
share data) Mar. 31, 2002 Mar. 31, 2001
Total assets $5,842,789 $5,770,888
Total loans 3,373,742 3,279,473
Total deposits 4,170,178 4,145,613
Stockholders' equity 446,823 465,491
Book value per share $9.21 $9.14
Period end shares outstanding 48,534 50,907
Stock Performance Data Quarters Ended
Unaudited March 31,
2002 2001
Market Price:
Quarter End $29.04 $22.52
High $29.81 $23.40
Low $27.01 $20.65
Quarter end price to book value 3.2 x 2.5
Quarter end price to consensus
estimated 2002 earnings 16.0 x N/A x
Dividends declared per share $0.17 $0.16
All share and per share data has been adjusted to reflect the 5-for-4
stock split paid in December 2001.
First Midwest Bancorp, Inc. Press Release Dated April 17, 2002
Condensed Consolidated Statements of Condition
Unaudited March 31,
(Amounts in thousands) 2002 2001
Assets
Cash and due from banks $182,559 $186,525
Funds sold and other short-term
investments 19,650 12,547
Securities available for sale 1,907,294 1,937,236
Securities held to maturity, at
amortized cost 96,956 95,940
Loans 3,373,742 3,279,473
Reserve for loan losses (47,774) (45,421)
Net loans 3,325,968 3,234,052
Premises, furniture and equipment 81,625 81,178
Investment in corporate owned life
insurance 136,819 129,858
Accrued interest receivable and
other assets 91,918 93,552
Total assets $5,842,789 $5,770,888
Liabilities and Stockholders' Equity
Deposits $4,170,178 $4,145,613
Borrowed funds 1,174,370 1,099,028
Accrued interest payable and other
liabilities 51,418 60,756
Total liabilities 5,395,966 5,305,397
Common stock 569 569
Additional paid-in capital 72,500 77,794
Retained earnings 551,400 499,048
Accumulated other comprehensive
(loss) income (1,129) 4,821
Treasury stock, at cost (176,517) (116,741)
Total stockholders' equity 446,823 465,491
Total liabilities and
stockholders' equity $5,842,789 $5,770,888
All share and per share data has been adjusted to reflect the 5-for-4
stock split paid in December 2001.
First Midwest Bancorp, Inc. Press Release Dated April 17, 2002
Condensed Consolidated Statements of Income
Unaudited Quarters Ended March 31,
(Amounts in thousands except per
share data) 2002 2001
Interest Income
Loans $56,937 $69,212
Securities 26,844 33,236
Other 162 193
Total interest income 83,943 102,641
Interest Expense
Deposits 22,616 40,117
Borrowed funds 7,080 15,636
Total interest expense 29,696 55,753
Net interest income 54,247 46,888
Provision for Loan Losses 5,055 3,458
Net interest income after
provision for loan losses 49,192 43,430
Noninterest Income
Service charges on deposit accounts 5,756 5,492
Trust and investment management fees 2,708 2,673
Other service charges, commissions,
and fees 4,293 4,267
Corporate owned life insurance
income 1,698 2,268
Securities gains, net - 704
Other 1,687 1,522
Total noninterest income 16,142 16,926
Noninterest Expense
Salaries and employee benefits 19,559 18,438
Occupancy expenses 3,515 4,114
Equipment expenses 1,882 1,954
Technology and related costs 2,466 2,541
Other 8,214 8,046
Total noninterest expense 35,636 35,093
Income before taxes 29,698 25,263
Income tax expense 7,627 5,939
Net Income $22,071 $19,324
Diluted Earnings Per Share $0.45 $0.38
Cash Basis Diluted Earnings Per
Share $0.45 $0.39
Dividends Declared Per Share $0.17 $0.16
Weighted Average Diluted Shares
Outstanding 49,047 51,356
All share and per share data has been adjusted to reflect the 5-for-4
stock split paid in December 2001.
First Midwest Bancorp, Inc. Press Release Dated April 17, 2002
Selected Quarterly Data
Unaudited Quarters Ended
(Amounts in thousands except
per share data) 03/31/02 12/31/01 09/30/01 6/30/01 03/31/01
Net interest income $54,247 $53,848 $53,279 $50,365 $46,888
Provision for loan losses 5,055 6,313 5,248 4,065 3,458
Noninterest income 16,142 17,433 17,238 17,269 16,926
Noninterest expense 35,636 36,660 36,884 36,719 35,093
Net income 22,071 21,274 21,249 20,291 19,324
Diluted earnings per share $0.45 $0.43 $0.42 $0.40 $0.38
Return on average equity 19.39% 18.24% 18.57% 17.65% 17.06%
Return on average assets 1.55% 1.47% 1.47% 1.41% 1.36%
Net interest margin 4.32% 4.33% 4.27% 4.04% 3.77%
Efficiency ratio 47.26% 48.08% 48.92% 50.46% 51.35%
Period end shares
outstanding 48,534 48,725 49,109 50,112 50,907
Book value per share $9.21 $9.18 $9.31 $9.03 $9.14
Dividends per share $0.17 $0.17 $0.16 $0.16 $0.16
Cash basis net income(A) $22,177 $21,923 $21,898 $20,977 $19,990
Cash basis diluted earnings
per share(A) $0.45 $0.45 $0.44 $0.41 $0.39
Return on average equity -
cash basis(A) 19.49% 18.80% 19.14% 18.25% 17.65%
Return on average assets -
cash basis(A) 1.57% 1.52% 1.52% 1.47% 1.41%
(A) Excludes amortization of goodwill, core deposit premiums, and other
intangibles, net of tax.
Asset Quality
Unaudited Quarters Ended
(Amounts in thousands) 03/31/02 12/31/01 09/30/01 06/30/01 03/31/01
Nonperforming loans $15,277 $16,847 $21,425 $20,518 $22,453
Foreclosed real estate 4,289 3,630 3,651 2,425 1,246
Loans past due 90 days and
still accruing 4,739 5,783 6,117 5,187 5,339
Nonperforming loans to loans 0.45% 0.50% 0.62% 0.61% 0.68%
Nonperforming assets to loans
plus foreclosed real
estate 0.58% 0.61% 0.73% 0.68% 0.72%
Reserve for loan losses to
loans 1.42% 1.42% 1.38% 1.38% 1.39%
Reserve for loan losses to
nonperforming loans 313% 283% 223% 228% 202%
Provision for loan losses $5,055 $6,313 $5,248 $4,065 $3,458
Net loan charge-offs 5,026 6,313 4,208 2,781 3,130
Net loan charge-offs to
average loans 0.61% 0.73% 0.49% 0.34% 0.39%
All share and per share data has been adjusted to reflect the 5-for-4
stock split paid in December 2001.
SOURCE First Midwest Bancorp, Inc.
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Related links:
http://www.firstmidwest.com
Company News On-Call:
http://www.prnewswire.com/comp/122621.html
CONTACT:
Donald J. Swistowicz, +1-630-875-7460, James
M. Roolf, +1-630-875-7463, both of First Midwest Bancorp, Inc.
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