First Financial Corporation Reports 2012 Results

Marketwired

TERRE HAUTE, IN--(Marketwire - Feb 8, 2013) - First Financial Corporation (NASDAQ: THFF) today announced results for the three months and year ended December 31, 2012. Net income of $32.8 and $8.6 million for the twelve and three months, respectively, compares to $37.2 and $10.2 million for the same periods of 2011. Return on assets for the twelve and three months ended December 31, 2012 was 1.13% and 1.14%, respectively, compared to 1.49% and 1.61% for the twelve and three months ended December 31, 2011. Results for 2012 include income and expenses incurred in 2012 associated with the purchase of Freestar Bank on December 30, 2011.

Net interest income for the last quarter of 2012 was $26.7 million, an increase of 9.45% over the $24.4 million reported for the same period of 2011. Net interest income for the year ended December 31, 2012 was $108.9 million compared to the $99.2 million reported for the same period of 2011, an increase of $9.7 million. The net interest margin at December 31, 2012 was 4.30%, compared to 4.50% reported at December 31, 2011.

The provision for loan losses for the three months ended December 31, 2012 was $1.5 million compared to the $1.9 million provision for the fourth quarter of 2011. For the year ended December 31, 2012 and 2011, the provision expense was $8.8 and $5.8 million, respectively. 

Non-interest income for the three months ended December 31, 2012 and 2011 was $10.6 and $8.2 million, respectively, a 28.5% increase. Gains from the sale of mortgage loans comprised $0.8 million of the increase. For the year ended December 31, 2012, non-interest income increased $6.2 million to $39.5 million from the $33.3 million reported for the same period of 2011.

Non-interest expense for the three months ended December 31, 2012 was $23.6 million compared to $18.3 million in 2011. For the year ended December 31, 2012, non-interest expense was $93.1 million compared to $75.2 for the year ended December 31, 2011. 2012 non-interest expense contains the additional salary, benefits and one-time expenses related to the acquisition of Freestar Bank and the opening of four banking centers by First Financial Bank which did not exist during 2011.

Total loans at December 31, 2012 of $1.86 billion compare to the $1.89 billion reported during the same period a year ago. Deposits increased by $1.6 million to $2.27 billion. The allowance for loan losses increased 14.1% to $22.0 million from the $19.2 million at December 31, 2011. Net charge-offs for 2012 were down $0.7 million from 2011.

Book value per share was $27.93 at year end 2012, a 5.9% increase from the $26.38 at December 31, 2011. Shareholders' equity increased 7.3% to $372.1 million from $347.0 million on December 31, 2011.

First Financial Corporation is the holding company for First Financial Bank N.A. in Indiana and Illinois, The Morris Plan Company of Terre Haute and Forrest Sherer Inc. in Indiana.

             
             
CONSOLIDATED BALANCE SHEETS            
    December 31,  
(Dollar amounts in thousands, except per share data)   2012     2011  
ASSETS                
Cash and due from banks   $ 87,230     $ 134,280  
Federal funds sold     20,800       11,725  
Securities available-for-sale     691,000       666,287  
Loans, net of allowance of $21,958 in 2012 and $19,241 in 2011     1,829,978       1,874,438  
Restricted Stock     21,292       22,282  
Accrued interest receivable     12,024       12,947  
Premises and equipment, net     47,308       40,105  
Bank-owned life insurance     77,295       82,646  
Goodwill     37,612       36,897  
Other intangible assets     3,893       5,142  
Other real estate owned     7,722       4,964  
FDIC Indemnification Asset     2,632       2,384  
Other assets     56,622       59,964  
  TOTAL ASSETS   $ 2,895,408     $ 2,954,061  
                 
                 
LIABILITIES AND SHAREHOLDERS' EQUITY                
Deposits:                
Non-interest-bearing   $ 465,954     $ 435,236  
Interest-bearing:                
  Certificates of deposit of $100 or more     213,610       242,001  
  Other interest-bearing deposits     1,596,570       1,597,262  
      2,276,134       2,274,499  
Short-term borrowings     40,551       100,022  
Other borrowings     119,705       146,427  
Other liabilities     86,896       86,152  
  TOTAL LIABILITIES     2,523,286       2,607,100  
                 
Shareholders' equity                
Common stock, $.125 stated value per share;                
  Authorized shares-40,000,000                
  Issued shares-14,490,609 in 2012 and 14,450,966 in 2011.                
  Outstanding shares-13,287,348 in 2012 and 13,197,880 in 2011     1,808       1,806  
Additional paid-in capital     69,989       69,328  
Retained earnings     338,342       318,130  
Accumulated other comprehensive income (loss)     (7,472 )     (10,494 )
Less: Treasury shares at cost-1,203,261 in 2012 and 1,253,086 in 2011     (30,545 )     (31,809 )
                 
  TOTAL SHAREHOLDERS' EQUITY     372,122       346,961  
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 2,895,408     $ 2,954,061  
             
             
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME        
    Years Ended
December 31,
 
(Dollar amounts in thousands, except per share data)   2012     2011  
INTEREST AND DIVIDEND INCOME:                
Loans, including related fees   $ 99,196     $ 91,392  
  Securities:                
  Taxable     13,542       16,161  
  Tax-exempt     7,246       6,779  
Other     2,321       2,009  
    TOTAL INTEREST AND DIVIDEND INCOME     122,305       116,341  
                 
INTEREST EXPENSE:                
Deposits     8,520       12,127  
Short-term borrowings     140       187  
Other borrowings     4,733       4,833  
    TOTAL INTEREST EXPENSE     13,393       17,147  
                 
    NET INTEREST INCOME     108,912       99,194  
                 
Net Provision for loan losses     8,773       5,755  
                 
    NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES     100,139       93,439  
                 
NON-INTEREST INCOME:                
Trust and financial services     5,804       4,544  
Service charges and fees on deposit accounts     9,742       8,995  
Other service charges and fees     9,710       8,289  
Securities gain, net     886       6  
Other-than-temporary loss                
  Total impairment loss     (11 )     (110 )
  Loss recognized in other comprehensive income     -       -  
    Net impairment loss recognized in earnings     (11 )     (110 )
Insurance commissions     7,422       7,347  
Gain on sale of mortgage loans     4,590       1,957  
Other     1,404       2,312  
    TOTAL NON-INTEREST INCOME     39,547       33,340  
NON-INTEREST EXPENSES:                
Salaries and employee benefits     56,211       45,362  
Occupancy expense     5,746       4,777  
Equipment expense     5,489       4,352  
Federal Deposit Insurance     1,949       1,804  
Other     23,661       18,892  
    TOTAL NON-INTEREST EXPENSE     93,056       75,187  
    INCOME BEFORE INCOME TAXES     46,630       51,592  
                 
Provision for income taxes     13,818       14,397  
    NET INCOME   $ 32,812     $ 37,195  
OTHER COMPREHENSIVE INCOME                
    Change in unrealized gains/losses on securities, net of reclassifications and taxes   $ 691     $ 8,857  
    Change in funded status of post retirement benefits, net of taxes   $ 2,331     $ (9,982 )
    COMPREHENSIVE INCOME   $ 35,834     $ 36,070  
EARNINGS PER SHARE:                
    BASIC AND DILUTED   $ 2.48     $ 2.83  
Weighted average number of shares outstanding (in thousands)     13,240       13,163  
             
             
Key Ratios   For the year ended  
    December 31,     December 31,  
    2012     2011  
Return on average assets     1.13 %     1.49 %
Return on average common shareholder's equity     9.02 %     10.90 %
Average common shareholder's equity to average assets     12.84 %     12.32 %
End of period tangible common equity to tangible assets     11.58 %     10.47 %
Book value per share   $ 28.01     $ 26.38  
Tangible book value per share   $ 24.88     $ 23.19  
Risk-based capital - Tier 1     14.78 %     13.96 %
Risk-based capital - Total     15.67 %     14.71 %
Net interest margin     4.30 %     4.50 %
Efficiency Ratio     60.24 %     54.47 %
Net charge-offs to average loans and leases     0.45 %     0.33 %
Loan and lease loss reserve to loans and leases     1.19 %     1.15 %
Nonperforming assets to loans and leases     2.53 %     2.38 %
                 
Asset Quality   For the year ended  
    December 31,     December 31,  
    2012     2011  
Accruing loans and leases past due 90 days or more   $ 3,362     $ 2,047  
Nonaccrual loans and leases     35,794       38,102  
Other real estate owned     7,722       4,964  
Total nonperforming assets   $ 46,878     $ 45,113  
Contact:
For more information contact:
Rodger A. McHargue
(812) 238-6334

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