MIDLAND, Mich., Oct. 22 /PRNewswire-FirstCall/ -- Aloysius J. Oliver,
Chairman of Chemical Financial Corporation (Nasdaq: CHFC), today announced
third quarter net income of $14.02 million, or $.62 per diluted share,
compared with net income of $12.98 million, or $.58 per diluted share for the
third quarter of 2001. The Corporation's third quarter 2002 net income was 8%
above the third quarter 2001, while third quarter 2002 earnings per share were
6.9% above the prior year quarter. The Corporation's return on average assets
and return on average equity during the third quarter of 2002 were 1.58% and
13.5%, respectively, as compared with 1.58% and 13.6% for the third quarter of
2001.
For the nine months ended September 30, 2002, the Corporation earned net
income of $41.26 million or $1.83 per share, as compared to net operating
income of $36.02 million, or $1.60 per share for the first nine months of
2001. This represents a 14.5% increase in operating earnings per share. Net
operating income in 2001 excludes pre-tax non-recurring expenses totaling
$9,167,000, or $7,076,000 on an after-tax basis for merger and consolidation
related costs incurred to complete the merger with Shoreline Financial
Corporation and other internal company consolidations. Comparing net income
for the first nine months of 2001, which includes the merger related and
consolidated charges, versus the first nine months of 2002, net income was up
42.6%.
The growth in net income in the third quarter of 2002, as compared to the
same period in 2001, resulted primarily from substantial increases in both net
interest income and service charges on deposit accounts.
Total assets of the Corporation at September 30, 2002 were $3.60 billion,
up 2.2% over the $3.52 billion in total assets reported at September 30, 2001.
Total deposits at September 30, 2002 were $2.86 billion, up 1.6% over total
deposits of $2.81 billion at September 30, 2001. Total loans were 2.06
billion at September 30, 2002, down $161 million, or 7.3%, from total loans at
September 30, 2001 of $2.22 billion. The decline in loans was primarily
attributable to a reduction in residential real estate loans. The low
interest rate environment prompted many customers to refinance their mortgages
to the longer-term fixed interest rate product that the Corporation sells in
the secondary market.
The Corporation's provision for loan losses for the three and nine months
ended September 30, 2002 was $747,000 and $2.75 million, respectively, as
compared to net loan losses during the same time periods in 2002 of $757,000
and $2.75 million, respectively. As of September 30, 2002, the allowance for
loan losses was $31 million, or 1.50% of total loans, while non-performing
loans were $13.9 million, or .68% of total loans.
Shareholders' equity at September 30, 2002 was $421 million, or $18.67
share, and represented 11.7% of total assets. The Corporation's tangible
equity to asset ratio was 10.7% at the end of the current quarter.
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 33 counties
in the lower peninsula of Michigan. CFC Data Corp, Midland, is the Company's
wholly owned data processing subsidiary.
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 interest 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) 2002 2001 2001
Assets:
Cash and demand deposits due from
banks $129,874 $150,546 $129,506
Federal funds sold 144,210 86,800 133,110
Interest-bearing deposits with
unaffiliated banks 51,725 40,591 52,668
Investment securities taxable 1,068,982 872,748 841,086
Investment securities nontaxable 53,591 59,527 61,793
Total Investment Securities 1,122,573 932,275 902,879
Commercial and agricultural loans 311,079 332,055 350,181
Real estate construction loans 110,212 137,500 115,536
Real estate commercial loans 470,547 432,747 427,709
Real estate residential loans 645,209 769,272 824,641
Consumer loans 524,312 510,967 504,458
Total Loans 2,061,359 2,182,541 2,222,525
Less: Allowance for loan losses 31,000 30,994 31,143
Net Loans 2,030,359 2,151,547 2,191,382
Premises and equipment 43,159 43,143 43,472
Intangible assets 41,512 42,615 43,111
Other assets 37,352 40,789 26,748
Total Assets $3,600,764 $3,488,306 $3,522,876
Liabilities and Shareholders' Equity:
Noninterest-bearing deposits $457,330 $460,619 $435,813
Interest-bearing deposits 2,402,491 2,328,905 2,378,756
Total Deposits 2,859,821 2,789,524 2,814,569
FHLB borrowings 157,528 167,893 170,168
Other borrowings - short term 131,183 118,584 129,022
Interest payable and other liabilities 31,014 22,849 25,409
Total Liabilities 3,179,546 3,098,850 3,139,168
Shareholders' Equity:
Common stock, $1 par value 22,558 22,514 21,427
Surplus 291,003 290,656 258,685
Retained earnings 89,822 64,792 89,039
Accumulated other comprehensive
income 17,835 11,494 14,557
Total Shareholders' Equity 421,218 389,456 383,708
Total Liabilities and
Shareholders' Equity $3,600,764 $3,488,306 $3,522,876
Chemical Financial Corporation Announces Third Quarter Operating Results
Consolidated Statements of Income (Unaudited)
Chemical Financial Corporation and Subsidiaries
Quarter Ended Nine Months Ended
September 30, September 30,
(In thousands, except per share
data) 2002 2001 2002 2001
Interest Income:
Interest and fees on loans $38,519 $40,934 $118,022 $117,750
Interest on investment securities:
Taxable 12,550 12,200 37,509 37,276
Nontaxable 701 813 2,233 2,553
Total Interest on Securities 13,251 13,013 39,742 39,829
Interest on federal funds sold 542 1,126 1,615 4,016
Interest on deposits with
unaffiliated banks 145 236 593 454
Total Interest Income 52,457 55,309 159,972 162,049
Interest Expense:
Interest on deposits 13,618 19,702 43,273 60,820
Interest on FHLB borrowings 2,201 1,632 6,648 5,004
Interest on other borrowings -
short term 257 635 758 2,317
Total Interest Expense 16,076 21,969 50,679 68,141
Net Interest Income 36,381 33,340 109,293 93,908
Provision for loan losses 747 432 2,752 1,274
Net Interest Income after
provision for loan losses 35,634 32,908 106,541 92,634
Noninterest Income:
Trust services revenue 1,476 1,603 4,772 4,938
Service charges on deposit
accounts 3,966 2,574 9,602 7,994
Other charges and fees for
customer services 1,830 1,737 5,248 5,164
Mortgage banking revenue 1,327 1,727 5,506 3,659
Investment securities gains
(losses) (99) 122 (184) 414
Other 106 131 351 391
Total Noninterest Income 8,606 7,894 25,295 22,560
Operating Expenses:
Salaries and employee benefits 13,606 12,303 40,738 35,588
Occupancy and equipment 3,927 3,396 11,827 10,096
Other 5,601 5,612 17,269 15,530
Merger and restructuring expenses - - - 9,167
Total Operating Expenses 23,134 21,311 69,834 70,381
Income Before Income Taxes 21,106 19,491 62,002 44,813
Federal income taxes 7,088 6,515 20,739 15,867
Net Income $14,018 $12,976 $41,263 $28,946
Net income per share:
Basic $0.62 $0.58 $1.83 $1.28
Diluted 0.62 0.58 1.83 1.28
Diluted - net operating income 0.62 0.58 1.83 1.60
Cash dividends per share 0.24 0.23 0.72 0.69
Average shares outstanding:
Basic 22,559 22,504 22,547 22,499
Diluted 22,645 22,572 22,610 22,557
Chemical Financial Corporation Announces Third Quarter Operating Results
Financial Summary (Unaudited)
Chemical Financial Corporation and Subsidiaries
(Dollars in thousands)
Quarter Ended Nine Months Ended
September 30, September 30,
2002 2001 2002 2001
Average Balances
Total assets $3,529,169 $3,261,785 $3,531,725 $3,126,873
Total earning assets 3,320,228 3,068,215 3,310,645 2,943,695
Total loans 2,074,641 2,023,380 2,092,588 1,926,651
Total deposits 2,814,426 2,627,392 2,820,434 2,517,383
Total shareholders' equity 411,634 378,431 400,811 365,031
Quarter Ended Nine Months Ended
September 30, September 30,
2002 2001 2002 2001
Key Ratios (annualized where applicable)
Net interest margin 4.40% 4.38% 4.47% 4.36%
Efficiency ratio 50.9% 51.0% 51.3% 51.7%
Return on average assets 1.58% 1.58% 1.56% 1.24%
Return on average assets
- net operating income (1) 1.58% 1.58% 1.56% 1.54%
Return on average shareholders'
equity 13.5% 13.6% 13.8% 10.6%
Return on average shareholders'
equity
- net operating income (1) 13.5% 13.6% 13.8% 13.2%
Average shareholders' equity as a
percent of average assets 11.7% 11.6% 11.3% 11.7%
Tangible shareholders' equity as a
percent of total assets 10.7% 9.8%
Total risk-based capital ratio 18.4% 16.7%
September 30,
2002 2001
Credit Quality Statistics
Nonaccrual loans $8,269 $7,284
Loans 90 or more days past due
and still accruing 5,677 6,045
Restructured loans - -
Total nonperforming loans 13,946 13,329
Repossessed assets acquired (RAA) 1,559 621
Total nonperforming assets 15,505 13,950
Net loan charge-offs 2,745 776
Allowance for loan losses as a
percent of total loans 1.50% 1.40%
Allowance for loan losses as a
percent of nonperforming loans 222% 234%
Nonperforming loans as a
percent of total loans 0.68% 0.60%
Nonperforming assets as a
percent of total loans plus RAA 0.75% 0.63%
Net loan charge-offs as a
percent of average loans
(annualized) 0.18% 0.05%
September 30,
2002 2001
Additional Data
Goodwill $27,940 $28,232
Core deposit intangibles 10,511 12,427
Mortgage servicing rights 3,061 2,452
Amortization of intangibles (YTD) 2,942 2,244
(1) Net operating income is based on net income that excludes $7.1
million, on an after-tax basis, of merger related and consolidation
costs incurred in January 2001 in connection with the merger with
Shoreline Financial Corporation and the Corporation's internal
consolidation of nine of its eleven bank charters into two.
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. 3rd Qtr.
2002 2002 2002 2001 2001
Summary of Operations
Interest income 52,457 53,274 $54,241 $56,947 55,309
Interest expense 16,076 16,585 18,018 21,041 21,969
Net interest income 36,381 36,689 36,223 35,906 33,340
Provision for loan losses 747 1,352 653 730 432
Net interest income after
provision for loan losses 35,634 35,337 35,570 35,176 32,908
Noninterest income 8,606 8,018 8,671 9,313 7,894
Noninterest expense 23,134 23,021 23,679 23,962 21,311
Income taxes 7,088 6,799 6,852 6,750 6,515
Net income 14,018 13,535 13,710 13,777 12,976
Per Common Share Data
Net income:
Basic $0.62 $0.60 $0.61 $0.62 $0.58
Diluted 0.62 0.60 0.61 0.61 0.58
Cash dividends 0.24 0.24 0.24 0.23 0.23
Book value 18.67 18.05 17.40 17.30 17.06
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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