MIDLAND, Mich., Oct. 21 /PRNewswire-FirstCall/ -- Aloysius J. Oliver,
Chairman of Chemical Financial Corporation (Nasdaq: CHFC), today announced
third quarter net income of $14.47 million or $.61 per diluted share, up $.45
million as compared with net income of $14.02 million, or $.59 per diluted
share for the third quarter of 2002. This represented an increase of 3.4% in
earnings per share and a 3.2% increase in net income for the third quarter
2003. The returns on average assets and average equity during the third
quarter of 2003 were 1.60% and 12.92%, respectively, as compared with 1.58%
and 13.51%, respectively, for the third quarter of 2002.
Net interest income decreased $1.64 million, or 4.5%, to $34.76 million in
the third quarter of 2003, as compared to the third quarter of 2002. The
decrease, in part, was due to the low interest rate environment and the
decrease in the yield on the earning assets which has outpaced the decrease in
the cost of funds. The Corporation's earnings were positively affected by an
increase in noninterest income of $1.69 million, or 19.6%. This increase was
primarily due to higher mortgage banking revenue of $.98 million. Operating
expenses decreased by $.43 million, or 1.9%.
For the nine months ended September 30, 2003, the Corporation earned net
income of $42.15 million or $1.78 per share, as compared to net income of
$41.26 million, or $1.74 per share for the first nine months of 2002. This
represented a 2.3% increase in earnings per share.
Total assets of the Corporation at September 30, 2003 were $3.59 billion,
down .2% from the $3.60 billion in total assets reported at September 30,
2002. Total deposits at September 30, 2003 were $2.87 billion, up .3% over
total deposits of $2.86 billion at September 30, 2002. Total loans increased
10.4% during the latest twelve months, from $2.06 billion at September 30,
2002, to $2.28 billion in outstanding loans at September 30, 2003.
The Corporation's provision for loan losses for the quarter ended
September 30, 2003 was $.54 million, compared to net loan losses of $.61
million. For the nine months ended September 30, 2003 the provision for loan
losses was $2.11 million compared to net loan losses of $2.36 million. As of
September 30, 2003, the allowance for loan losses was $30.41 million and
represented 1.34% of total loans. Nonperforming loans were $9.04 million, or
.40% of total loans at the current quarter-end.
Shareholders' equity at September 30, 2003 was $449 million, or $18.94 per
share, which represented 12.5% of total assets. The tangible equity to asset
ratio was 11.5% as of September 30, 2003.
On September 25, 2003 the Corporation announced that it had entered into a
definitive agreement to acquire Caledonia Financial Corporation ("Caledonia").
Caledonia is a bank holding company headquartered in Caledonia, Michigan, with
total assets of approximately $210 million, total deposits of $181 million and
total shareholders' equity of $21.3 million, all as of June 30, 2003.
Caledonia is the parent company of the State Bank of Caledonia that provides
banking services through four offices located in Kent, Kalamazoo and Barry
counties in Michigan. The transaction is expected to be completed during the
fourth quarter of this year.
Chemical Financial Corporation is the fourth largest bank holding company
headquartered in Michigan. The Company's three subsidiary banks operate 129
"Chemical Bank" offices and 2 loan production offices spread over 32 counties
in the lower peninsula of Michigan.
Chemical Financial Corporation common stock trades on The Nasdaq Stock
Market under the symbol CHFC and is one of the issues comprising the Nasdaq
Financial 100 index.
Forward Looking Statements
This press release contains forward-looking statements. Words such as
"anticipates," "believes," "estimates," "expects," "intends," "should,"
"will," variations of such words and similar expressions are intended to
identify forward-looking statements. These statements reflect management's
current beliefs as to the expected outcomes of future events and are not
guarantees of future performance. These statements involve certain risks,
uncertainties and assumptions 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 or
forecasted in such forward-looking statements. Factors that could cause a
difference include, among others: changes in the national and local economies
or market conditions; changes in interests rates and banking regulations; the
impact of competition from traditional or new sources; and the possibility
that anticipated cost savings and revenue enhancements from mergers and
acquisitions and bank consolidations may not be fully realized at all or
within the expected time frames. These and other factors that may emerge
could cause decisions and actual results to differ materially from current
expectations. Chemical undertakes no obligation to revise, update, or clarify
forward-looking statements to reflect events or conditions after the date of
this release.
Chemical Financial Corporation Announces Third Quarter Operating Results
Consolidated Statements of Financial Position (Unaudited)
Chemical Financial Corporation and Subsidiaries
September 30, December 31, September 30,
(In thousands) 2003 2002 2002
Assets:
Cash and demand deposits due
from banks $146,428 $148,112 $129,874
Federal funds sold 44,700 69,900 144,210
Interest-bearing deposits with
unaffiliated banks 19,905 53,135 51,725
Investment securities taxable 957,741 1,076,292 1,068,463
Investment securities
nontaxable 46,732 51,690 53,591
Total Investment
Securities 1,004,473 1,127,982 1,122,054
Commercial loans 333,822 327,438 314,271
Real estate construction loans 93,282 108,589 110,212
Real estate commercial loans 562,937 481,084 470,547
Real estate residential loans 765,539 648,286 643,368
Consumer loans 521,310 509,789 524,312
Total Loans 2,276,890 2,075,186 2,062,710
Less: Allowance for
loan losses 30,414 30,672 31,000
Net Loans 2,246,476 2,044,514 2,031,710
Premises and equipment 47,044 42,767 43,159
Intangible assets 39,017 40,489 41,512
Other assets 42,983 41,994 34,679
Total Assets $3,591,026 $3,568,893 $3,598,923
Liabilities and Shareholders' Equity:
Noninterest-bearing deposits $500,463 $475,933 $457,330
Interest-bearing deposits 2,369,351 2,371,339 2,402,491
Total Deposits 2,869,814 2,847,272 2,859,821
FHLB borrowings 148,573 157,393 157,528
Other borrowings - short term 93,447 104,212 131,183
Interest payable and
other liabilities 30,548 29,677 29,173
Total Liabilities 3,142,382 3,138,554 3,177,705
Shareholders' Equity:
Common stock, $1 par value 23,685 23,684 22,558
Surplus 324,413 325,149 291,003
Retained earnings 87,106 62,721 89,822
Accumulated other comprehensive
income 13,440 18,785 17,835
Total Shareholders' Equity 448,644 430,339 421,218
Total Liabilities and
Shareholders' Equity $3,591,026 $3,568,893 $3,598,923
Chemical Financial Corporation Announces Third Quarter Operating Results
Consolidated Statements of Income (Unaudited)
Chemical Financial Corporation and Subsidiaries
Three Months Ended Nine Months Ended
September 30, September 30,
(In thousands, except per share
data) 2003 2002 2003 2002
Interest Income:
Interest and fees on loans $36,220 $38,537 $108,789 $118,058
Interest on investment securities:
Taxable 8,213 12,550 28,671 37,509
Nontaxable 612 701 1,928 2,233
Total Interest on Investment
Securities 8,825 13,251 30,599 39,742
Interest on federal funds sold 169 542 612 1,615
Interest on deposits with
unaffiliated banks 23 145 180 593
Total Interest Income 45,237 52,475 140,180 160,008
Interest Expense:
Interest on deposits 8,262 13,618 28,555 43,273
Interest on FHLB borrowings 2,083 2,201 6,273 6,648
Interest on other borrowings -
short term 128 257 435 758
Total Interest Expense 10,473 16,076 35,263 50,679
Net Interest Income 34,764 36,399 104,917 109,329
Provision for loan losses 540 747 2,107 2,752
Net Interest Income after
Provision for Loan
Losses 34,224 35,652 102,810 106,577
Noninterest Income:
Service charges on deposit
accounts 4,181 3,966 12,334 9,602
Other charges and fees for
customer services 1,623 1,864 5,372 5,418
Mortgage banking revenue 2,308 1,327 5,716 5,506
Trust services revenue 1,605 1,476 5,123 4,772
Investment securities gains
(losses) 417 (99) 909 (184)
Other 140 54 220 145
Total Noninterest Income 10,274 8,588 29,674 25,259
Operating Expenses:
Salaries and employee benefits 13,287 13,606 40,570 40,855
Occupancy 1,981 1,890 5,882 5,664
Equipment 2,077 2,037 6,205 6,163
Other 5,356 5,601 16,252 17,152
Total Operating Expenses 22,701 23,134 68,909 69,834
Income Before Income Taxes 21,797 21,106 63,575 62,002
Federal income taxes 7,328 7,088 21,422 20,739
Net Income $14,469 $14,018 $42,153 $41,263
Net income per share:
Basic $0.61 $0.59 $1.78 $1.74
Diluted 0.61 0.59 1.78 1.74
Cash dividends per share 0.25 0.23 0.75 0.69
Average shares outstanding:
Basic 23,674 23,687 23,685 23,674
Diluted 23,735 23,759 23,737 23,741
Chemical Financial Corporation Announces Third Quarter Operating Results
Financial Summary (Unaudited)
Chemical Financial Corporation and Subsidiaries
(Dollars in thousands)
Three Months Ended
September 30,
2003 2002
Average Balances
Total assets $3,591,135 $3,528,471
Total interest-earning assets 3,384,140 3,322,202
Total loans 2,260,656 2,077,134
Total deposits 2,870,826 2,814,426
Total shareholders' equity 444,421 411,634
Nine Months Ended
September 30,
2003 2002
Average Balances
Total assets $3,576,236 $3,531,343
Total interest-earning assets 3,383,906 3,312,936
Total loans 2,179,041 2,095,395
Total deposits 2,863,047 2,820,434
Total shareholders' equity 439,961 400,811
Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
Key Ratios (annualized where
applicable)
Net interest margin 4.12% 4.40% 4.20% 4.47%
Efficiency ratio 49.95% 50.90% 50.72% 51.33%
Return on average assets 1.60% 1.58% 1.58% 1.56%
Return on average shareholders'
equity 12.92% 13.51% 12.81% 13.76%
Average shareholders' equity as
a percent of average assets 12.4% 11.7% 12.3% 11.4%
Tangible shareholders' equity
as a percent of total assets 11.5% 10.7%
Total risk-based capital ratio 18.8% 18.4%
September 30,
2003 2002
Credit Quality Statistics
Nonaccrual loans $5,268 $8,269
Loans 90 or more days past due
and still accruing interest 3,776 5,677
Total nonperforming loans 9,044 13,946
Repossessed assets acquired (RAA) 5,798 1,559
Total nonperforming assets 14,842 15,505
Net loan charge-offs 2,365 2,746
Allowance for loan losses as a
percent of total loans 1.34% 1.50%
Allowance for loan losses as a
percent of nonperforming loans 336% 222%
Nonperforming loans as a
percent of total loans 0.40% 0.68%
Nonperforming assets as a
percent of total loans plus RAA 0.65% 0.75%
Net loan charge-offs as a
percent of average loans 0.15% 0.18%
September 30,
2003 2002
Additional Data
Goodwill $27,940 $27,940
Core deposit and other intangibles 8,668 10,511
Mortgage servicing rights 2,409 3,061
Amortization of intangibles 3,185 2,942
Chemical Financial Corporation Announces Third Quarter Operating Results
Selected Quarterly Information (Unaudited)
Chemical Financial Corporation and Subsidiaries
(Dollars in thousands)
3rd Qtr. 2nd Qtr. 1st Qtr. 4th Qtr.
2003 2003 2003 2002
Summary of Operations
Interest income $45,237 $46,697 $48,246 $51,036
Interest expense 10,473 11,668 13,122 14,673
Net interest income 34,764 35,029 35,124 36,363
Provision for loan losses 540 1,272 295 1,013
Net interest income after provision
for loan losses 34,224 33,757 34,829 35,350
Noninterest income 10,274 10,086 9,314 9,275
Noninterest expense 22,701 23,182 23,026 23,692
Income taxes 7,328 6,991 7,103 7,251
Net income 14,469 13,670 14,014 13,682
Per Common Share Data
Net income:
Basic $0.61 $0.58 $0.59 $0.58
Diluted 0.61 0.58 0.59 0.57
Cash dividends 0.25 0.25 0.25 0.23
Book value 18.94 18.73 18.45 18.17
3rd Qtr. 2nd Qtr. 1st Qtr.
2002 2002 2002
Summary of Operations
Interest income $52,475 $53,292 $54,241
Interest expense 16,076 16,585 18,018
Net interest income 36,399 36,707 36,223
Provision for loan losses 747 1,352 653
Net interest income after provision
for loan losses 35,652 35,355 35,570
Noninterest income 8,588 8,000 8,671
Noninterest expense 23,134 23,021 23,679
Income taxes 7,088 6,799 6,852
Net income 14,018 13,535 13,710
Per Common Share Data
Net income:
Basic $0.59 $0.57 $0.58
Diluted 0.59 0.57 0.58
Cash dividends 0.23 0.23 0.23
Book value 17.78 17.19 16.57
SOURCE Chemical Financial Corporation
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Related links:
http://chemicalbankmi.com
Company News On-Call:
http://www.prnewswire.com/comp/157448.html
CONTACT:
David B. Ramaker, President & CEO,
+1-989-839-5269, or Lori A. Gwizdala, Executive Vice President &
Chief Financial Officer, +1-989-839-5358, both of Chemical
Financial Corporation
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