LANCASTER, PA -- (Marketwire) -- 07/17/12 --
Fulton Financial Corporation (NASDAQ: FULT)
- Diluted earnings per share for the second quarter of 2012 was 20 cents, a 5.3 percent increase from the first quarter of 2012 and an 11.1 percent increase from the second quarter of 2011.
- The provision for credit losses was $25.5 million for the second quarter of 2012, a $2.5 million, or 8.9 percent, decrease from the first quarter of 2012 and a $10.5 million, or 29.2 percent, decrease from the second quarter of 2011. Non-performing loans decreased $50.0 million, or 17.6 percent, in comparison to the first quarter of 2012. In June 2012, the Corporation sold $44.1 million of non-accrual commercial mortgage, commercial and construction loans to an investor.
- Net interest income decreased $1.2 million, or 0.8 percent, in comparison to the first quarter of 2012. Net interest margin decreased 7 basis points, or 1.8 percent, to 3.78 percent.
- In comparison to the first quarter of 2012, other income increased $1.7 million, or 3.3 percent, and other expenses increased $1.4 million, or 1.3 percent.
- In June 2012, the Corporation announced that its board of directors approved a share repurchase program pursuant to which the Corporation is authorized to repurchase up to five million shares, or approximately 2.5 percent of the Corporation's outstanding shares, through December 31, 2012.
Fulton Financial Corporation (NASDAQ: FULT) reported net income of $39.9 million, or 20 cents per diluted share, for the second quarter ended June 30, 2012, compared to $38.1 million, or 19 cents per diluted share, for the first quarter of 2012. For the six months ended June 30, 2012, net income was $78.0 million, or 39 cents per diluted share, compared to $70.2 million, or 35 cents per diluted share, for the same period in 2011.
"Improved asset quality and continued strong growth in non-interest income, especially from residential mortgage activity, contributed significantly to our second quarter earnings," said R. Scott Smith, Jr., Chairman and CEO. "We also saw improvement in our return on average assets which is a management priority. In the lending area, we experienced a decrease in the provision for credit losses and sold a group of non-accrual loans that enabled us to further reduce our level of non-performing assets. Even with this sale, end of quarter total outstanding loans increased modestly. While we experienced a decrease in our funding costs, asset yields contracted more rapidly, leading to a reduction in our net interest margin. Our increasing focus on enhancing our risk management and compliance infrastructure was reflected in higher expenses in the second quarter."
Asset Quality
As mentioned above, in June 2012, the Corporation sold $44.1 million of non-accrual commercial mortgage, commercial and construction loans to an investor. Below is a summary of the transaction (in thousands):
Commercial
-industrial,
Real Estate financial Real Estate
-Commercial and -Constructio
mortgage agricultural n Total
------------ ------------ ------------ --------
Net recorded investment
in loans sold $ 29,850 $ 11,520 $ 2,740 $ 44,110
Proceeds from sale, net
of selling expenses 15,910 5,170 1,850 $ 22,930
------------ ------------ ------------ --------
Total charge-off $ (13,940) $ (6,350) $ (890) $(21,180)
============ ============ ============ ========
Existing allocation for
credit losses on sold
loans $ (15,090) $ (7,510) $ (1,520) $(24,120)
============ ============ ============ ========
Non-performing assets were $266.3 million, or 1.63 percent of total assets, at June 30, 2012, compared to $317.5 million, or 1.92 percent of total assets, at March 31, 2012 and $348.3 million, or 2.18 percent of total assets, at June 30, 2011.
Annualized net charge-offs for the quarter ended June 30, 2012 were 1.55 percent of average total loans, compared to 0.94 percent for the quarter ended March 31, 2012. Excluding the impact of the loan sale, which resulted in second quarter charge-offs of $21.2 million, annualized net charge-offs to average loans for the second quarter and six months ended June 30, 2012 were 0.84 percent and 0.89 percent, respectively. The allowance for credit losses as a percentage of non-performing loans was 101.4 percent at June 30, 2012 in comparison to 90.9 percent at March 31, 2012.
Net Interest Income and Margin
Net interest income for the second quarter of 2012 decreased $1.2 million, or 0.8 percent, from the first quarter of 2012. Net interest margin decreased 7 basis points, or 1.8 percent, from 3.85 percent in the first quarter of 2012 to 3.78 percent in the second quarter of 2012. The decrease in net interest margin and net interest income was primarily due to yields on interest-earning assets decreasing more than funding costs. Average yields decreased 13 basis points, or 2.8 percent, while average costs decreased 6 basis points, or 6.1 percent. This impact was somewhat mitigated by a $141.0 million, or 0.9 percent, increase in interest-earning assets.
Average Balance Sheet
Total average assets for the second quarter of 2012 were $16.4 billion, an increase of $113.2 million, or 0.7 percent, from the first quarter of 2012, due primarily to a $111.3 million, or 4.0 percent, increase in investment securities.
Average loans, net of unearned income, decreased $13.3 million, or 0.1 percent, in comparison to the first quarter of 2012.
Quarter Ended
-----------------------
Jun 30 Mar 31 Increase (decrease)
-------------------
2012 2012 $ %
----------- ----------- --------- --------
(dollars in thousands)
Loans, by type:
Real estate - commercial
mortgage $ 4,634,436 $ 4,617,507 $ 16,929 0.4%
Commercial - industrial,
financial and agricultural 3,529,947 3,585,520 (55,573) (1.5%)
Real estate - home equity 1,599,702 1,611,565 (11,863) (0.7%)
Real estate - residential
mortgage 1,179,513 1,137,625 41,888 3.7%
Real estate - construction 640,282 641,574 (1,292) (0.2%)
Consumer 307,071 311,592 (4,521) (1.5%)
Leasing and other 74,753 73,589 1,164 1.6%
----------- ----------- --------- --------
Total Loans, net of unearned
income $11,965,704 $11,978,972 $ (13,268) (0.1%)
=========== =========== ========= ========
Changes in average loans, by type, included a $55.6 million decrease in commercial loans and an $11.9 million decrease in home equity loans. These decreases were partially offset by a $41.9 million increase in residential mortgages and a $16.9 million increase in commercial mortgages.
Average deposits for the second quarter of 2012 decreased $84.6 million, or 0.7 percent, from the first quarter of 2012.
Quarter Ended
-----------------------
Jun 30 Mar 31 Increase (decrease)
-------------------
2012 2012 $ %
----------- ----------- --------- --------
(dollars in thousands)
Deposits, by type:
Noninterest-bearing demand $ 2,669,152 $ 2,565,089 $ 104,063 4.1%
Interest-bearing demand 2,484,730 2,464,452 20,278 0.8%
Savings deposits 3,292,620 3,341,035 (48,415) (1.4%)
----------- ----------- --------- --------
Total demand and savings 8,446,502 8,370,576 75,926 0.9%
Time deposits 3,791,362 3,951,908 (160,546) (4.1%)
----------- ----------- --------- --------
Total Deposits $12,237,864 $12,322,484 $ (84,620) (0.7%)
=========== =========== ========= ========
The decrease in average deposits in the second quarter of 2012 in comparison to the first quarter of 2012 was a result of a $160.5 million decrease in time deposits, partially offset by a $75.9 million increase in demand and saving accounts. The increase in average demand and savings accounts occurred in personal and business accounts, partially offset by a decrease in municipal account balances.
Non-interest Income
Other income, excluding investment securities gains, increased $1.4 million, or 2.8 percent, in comparison to the first quarter of 2012, led by an increase in mortgage banking income of $1.1 million, or 10.9 percent, due to an increase in pricing spreads and an increase in the volume of new loan commitments. The Corporation also experienced increases in most fee income categories; with a $952,000 increase in other service charges and fees, a $525,000 increase in service charges on deposit accounts and a $445,000 increase in fees for investment management and trust services. These increases were partially offset by a $1.2 million decrease in gains on property sales.
Investment securities gains for the second quarter of 2012 were $1.5 million, compared to $1.3 million for the first quarter of 2012.
Non-interest Expense
Total other expenses increased $1.4 million, or 1.3 percent, in the second quarter of 2012 in comparison to the first quarter of 2012. During the second quarter of 2012, other expenses increased $2.4 million, or 15.0 percent, as a result of an increase in consulting services expense of $2.2 million. Partially offsetting this increase was a $1.3 million decrease in operating risk loss due to a decrease in reserves related to previously sold residential mortgages.
About Fulton Financial
Fulton Financial Corporation is a Lancaster, Pennsylvania-based financial holding company which has banking offices in Pennsylvania, Maryland, Delaware, New Jersey and Virginia through the following affiliates: Fulton Bank, N.A., Lancaster, PA; Swineford National Bank, Middleburg, PA; Lafayette Ambassador Bank, Easton, PA; FNB Bank, N.A., Danville, PA; Fulton Bank of New Jersey, Mt. Laurel, NJ; and The Columbia Bank, Columbia, MD.
The Corporation's investment management and trust services are offered at all banks through Fulton Financial Advisors, a division of Fulton Bank, N.A. Residential mortgage lending is offered by all banks under the Fulton Mortgage Company brand.
Additional information on Fulton Financial Corporation is available on the Internet at www.fult.com.
Safe Harbor Statement
This news release may contain forward-looking statements with respect to the Corporation's financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends" and similar expressions which are intended to identify forward-looking statements.
These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, some of which are beyond the Corporation's control and ability to predict, that could cause actual results to differ materially from those expressed in the forward-looking statements. The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Many factors could affect future financial results including, without limitation: the impact of adverse changes in the economy and real estate markets; increases in non-performing assets which may reduce the level of earning assets and require the Corporation to increase the allowance for credit losses, charge-off loans and incur elevated collection and carrying costs related to such non-performing assets; acquisition and growth strategies; market risk; changes or adverse developments in political or regulatory conditions; a disruption in, or abnormal functioning of, credit and other markets, including the lack of or reduced access to markets for mortgages and other asset-backed securities and for commercial paper and other short-term borrowings; changes in the levels of, or methodology for determining, FDIC deposit insurance premiums and assessments; the effect of competition and interest rates on net interest margin and net interest income; investment strategy and other income growth; investment securities gains and losses; declines in the value of securities which may result in charges to earnings; changes in rates of deposit and loan growth or a decline in loans originated; relative balances of rate-sensitive assets to rate-sensitive liabilities; salaries and employee benefits and other expenses; amortization of intangible assets; goodwill impairment; capital and liquidity strategies, and other financial and business matters for future periods.
For a more complete discussion of certain risks and uncertainties affecting the Corporation, please see the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" set forth in the Corporation's filings with the Securities and Exchange Commission.
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED ENDING BALANCE SHEETS (UNAUDITED)
dollars in thousands
% Change from
-----------------
June 30 June 30 March 31 June 30 March 31
2012 2011 2012 2011 2012
----------- ----------- ----------- ------- --------
ASSETS
Cash and due
from banks $ 242,811 $ 284,691 $ 286,875 (14.7%) (15.4%)
Loans held for
sale 71,406 47,133 70,128 51.5% 1.8%
Other interest-
earning assets 118,468 124,967 106,227 (5.2%) 11.5%
Investment
securities 2,870,832 2,663,044 3,089,407 7.8% (7.1%)
Loans, net of
unearned income 11,982,833 11,852,491 11,957,600 1.1% 0.2%
Allowance for
loan losses (235,737) (266,683) (256,496) (11.6%) (8.1%)
----------- ----------- -----------
Net Loans 11,747,096 11,585,808 11,701,104 1.4% 0.4%
Premises and
equipment 222,083 207,177 215,756 7.2% 2.9%
Accrued interest
receivable 48,283 51,387 51,247 (6.0%) (5.8%)
Goodwill and
intangible
assets 542,622 545,909 543,383 (0.6%) (0.1%)
Other assets 474,149 457,004 472,095 3.8% 0.4%
----------- ----------- -----------
Total Assets $16,337,750 $15,967,120 $16,536,222 2.3% (1.2%)
=========== =========== ===========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Deposits $12,232,484 $12,262,895 $12,340,722 (0.2%) (0.9%)
Short-term
borrowings 931,681 546,581 964,550 70.5% (3.4%)
Federal Home
Loan Bank
advances and
long-term debt 908,809 1,025,537 933,981 (11.4%) (2.7%)
Other
liabilities 223,592 178,798 274,106 25.1% (18.4%)
----------- ----------- -----------
Total
Liabilities 14,296,566 14,013,811 14,513,359 2.0% (1.5%)
Shareholders'
equity 2,041,184 1,953,309 2,022,863 4.5% 0.9%
----------- ----------- -----------
Total
Liabilities
and
Shareholders'
Equity $16,337,750 $15,967,120 $16,536,222 2.3% (1.2%)
=========== =========== ===========
LOANS, DEPOSITS AND SHORT-
TERM BORROWINGS DETAIL:
Loans, by type:
Real estate -
commercial
mortgage $ 4,653,097 $ 4,443,025 $ 4,634,428 4.7% 0.4%
Commercial -
industrial,
financial and
agricultural 3,538,188 3,678,858 3,518,228 (3.8%) 0.6%
Real estate -
home equity 1,599,468 1,626,545 1,601,880 (1.7%) (0.2%)
Real estate -
residential
mortgage 1,183,613 1,023,646 1,176,947 15.6% 0.6%
Real estate -
construction 619,060 681,588 647,700 (9.2%) (4.4%)
Consumer 308,469 330,965 308,495 (6.8%) -%
Leasing and
other 80,938 67,864 69,922 19.3% 15.8%
----------- ----------- -----------
Total Loans, net
of unearned
income $11,982,833 $11,852,491 $11,957,600 1.1% 0.2%
=========== =========== ===========
Deposits, by
type:
Noninterest-
bearing demand $ 2,748,269 $ 2,445,008 $ 2,682,259 12.4% 2.5%
Interest-bearing
demand 2,482,271 2,290,478 2,486,382 8.4% (0.2%)
Savings deposits 3,267,299 3,252,200 3,295,510 0.5% (0.9%)
Time deposits 3,734,645 4,275,209 3,876,571 (12.6%) (3.7%)
----------- ----------- -----------
Total Deposits $12,232,484 $12,262,895 $12,340,722 (0.2%) (0.9%)
=========== =========== ===========
Short-term
borrowings, by
type:
Customer
repurchase
agreements $ 204,526 $ 208,948 $ 204,627 (2.1%) -%
Customer short-
term promissory
notes 135,988 171,454 149,376 (20.7%) (9.0%)
Federal funds
purchased and
other 591,167 166,179 610,547 255.7% (3.2%)
----------- ----------- -----------
Total Short-term
borrowings $ 931,681 $ 546,581 $ 964,550 70.5% (3.4%)
=========== =========== ===========
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
dollars in thousands, except per-share data
Quarter Ended % Change from
------------------------------- -------------------
June 30 June 30 Mar 31 June 30 Mar 31
2012 2011 2012 2011 2012
--------- --------- --------- -------- --------
Interest Income:
Interest income $ 163,985 $ 174,935 $ 166,891 (6.3%) (1.7%)
Interest expense 26,455 34,290 28,196 (22.8%) (6.2%)
--------- --------- ---------
Net Interest
Income 137,530 140,645 138,695 (2.2%) (0.8%)
Provision for
credit losses 25,500 36,000 28,000 (29.2%) (8.9%)
--------- --------- ---------
Net Interest
Income after
Provision 112,030 104,645 110,695 7.1% 1.2%
Other Income:
Service charges on
deposit accounts 15,367 14,332 14,842 7.2% 3.5%
Other service
charges and fees 11,507 12,709 10,555 (9.5%) 9.0%
Mortgage banking
income 11,143 6,049 10,050 84.2% 10.9%
Investment
management and
trust services 9,822 9,638 9,377 1.9% 4.7%
Investment
securities gains
(losses) 1,538 (335) 1,251 N/M 22.9%
Other 3,987 3,386 5,605 17.7% (28.9%)
--------- --------- ---------
Total Other
Income 53,364 45,779 51,680 16.6% 3.3%
Other Expenses:
Salaries and
employee benefits 60,091 56,070 60,360 7.2% (0.4%)
Net occupancy
expense 11,205 10,874 10,935 3.0% 2.5%
Data processing 3,759 3,214 3,688 17.0% 1.9%
Equipment expense 3,185 3,377 3,369 (5.7%) (5.5%)
FDIC insurance
expense 3,002 3,264 3,021 (8.0%) (0.6%)
Professional fees 2,984 3,102 2,582 (3.8%) 15.6%
OREO and
repossession
expense 2,823 982 2,928 187.5% (3.6%)
Marketing 2,583 1,863 2,472 38.6% 4.5%
Software 2,272 1,973 2,175 15.2% 4.5%
Operating risk
loss 2,055 (8) 3,368 N/M (39.0%)
Other 18,184 16,174 15,813 12.4% 15.0%
--------- --------- ---------
Total Other
Expenses 112,143 100,885 110,711 11.2% 1.3%
--------- --------- ---------
Income Before
Income Taxes 53,251 49,539 51,664 7.5% 3.1%
Income tax expense 13,360 13,154 13,532 1.6% (1.3%)
--------- --------- ---------
Net Income $ 39,891 $ 36,385 $ 38,132 9.6% 4.6%
========= ========= =========
PER SHARE:
Net income:
Basic $ 0.20 $ 0.18 $ 0.19 11.1% 5.3%
Diluted 0.20 0.18 0.19 11.1% 5.3%
Cash dividends $ 0.07 $ 0.05 $ 0.07 40.0% -
Shareholders'
equity 10.16 9.80 10.10 3.7% 0.6%
Shareholders'
equity (tangible) 7.46 7.06 7.38 5.7% 1.1%
Weighted average
shares (basic) 199,671 198,772 199,492 0.5% 0.1%
Weighted average
shares (diluted) 200,806 199,527 200,344 0.6% 0.2%
Shares
outstanding, end
of period 200,880 199,370 200,354 0.8% 0.3%
SELECTED FINANCIAL
RATIOS:
Return on average
assets 0.98% 0.91% 0.94%
Return on average
common
shareholders'
equity 7.84% 7.53% 7.61%
Return on average
common
shareholders'
equity (tangible) 10.80% 10.71% 10.56%
Net interest
margin 3.78% 3.95% 3.85%
Efficiency ratio 57.55% 52.27% 56.84%
Six Months Ended
June 30
--------------------
2012 2011 % Change
--------- --------- --------
Interest Income:
Interest income $ 330,876 $ 350,629 (5.6%)
Interest expense 54,651 70,421 (22.4%)
--------- ---------
Net Interest
Income 276,225 280,208 (1.4%)
Provision for
credit losses 53,500 74,000 (27.7%)
--------- ---------
Net Interest
Income after
Provision 222,725 206,208 8.0%
Other Income:
Service charges on
deposit accounts 30,209 27,637 9.3%
Other service
charges and fees 22,062 24,191 (8.8%)
Mortgage banking
income 21,193 11,512 84.1%
Investment
management and
trust services 19,199 18,842 1.9%
Investment
securities gains
(losses) 2,789 1,950 43.0%
Other 9,592 7,108 34.9%
--------- ---------
Total Other
Income 105,044 91,240 15.1%
Other Expenses:
Salaries and
employee benefits 120,451 110,378 9.1%
Net occupancy
expense 22,140 22,240 (0.4%)
Data processing 7,447 6,586 13.1%
Equipment expense 6,554 6,509 0.7%
FDIC insurance
expense 6,023 8,018 (24.9%)
Professional fees 5,566 5,951 (6.5%)
OREO and
repossession
expense 5,751 2,253 155.3%
Marketing 5,055 4,699 7.6%
Software 4,447 4,004 11.1%
Operating risk
loss 5,423 (470) N/M
Other 33,997 31,581 7.7%
--------- ---------
Total Other
Expenses 222,854 201,749 10.5%
--------- ---------
Income Before
Income Taxes 104,915 95,699 9.6%
Income tax expense 26,892 25,529 5.3%
--------- ---------
Net Income $ 78,023 $ 70,170 11.2%
========= =========
PER SHARE:
Net income:
Basic $ 0.39 $ 0.35 11.4%
Diluted 0.39 0.35 11.4%
Cash dividends $ 0.14 $ 0.09 55.6%
Shareholders'
equity 10.16 9.80 3.7%
Shareholders'
equity (tangible) 7.46 7.06 5.7%
Weighted average
shares (basic) 199,581 198,686 0.5%
Weighted average
shares (diluted) 200,575 199,407 0.6%
Shares
outstanding, end
of period 200,880 199,370 0.8%
SELECTED FINANCIAL
RATIOS:
Return on average
assets 0.96% 0.88%
Return on average
common
shareholders'
equity 7.72% 7.38%
Return on average
common
shareholders'
equity (tangible) 10.68% 10.54%
Net interest
margin 3.81% 3.93%
Efficiency ratio 57.20% 52.83%
N/M - Not meaningful
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands
Quarter Ended
---------------------------------
June 30, 2012
-------------------------------
Average Interest Yield/
Balance (1) Rate
----------- ---------- ------
ASSETS
Interest-earning assets:
Loans, net of unearned income $11,965,704 $ 144,263 4.85%
Taxable investment securities 2,533,060 18,624 2.94%
Tax-exempt investment securities 283,736 3,992 5.63%
Equity securities 106,954 707 2.65%
----------- ---------- ------
Total Investment Securities 2,923,750 23,323 3.19%
Loans held for sale 55,813 538 3.85%
Other interest-earning assets 129,272 45 0.14%
----------- ---------- ------
Total Interest-earning Assets 15,074,539 168,169 4.48%
Noninterest-earning assets:
Cash and due from banks 233,427
Premises and equipment 216,881
Other assets 1,093,673
Less: allowance for loan losses (259,327)
-----------
Total Assets $16,359,193
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Demand deposits $ 2,484,730 $ 1,025 0.17%
Savings deposits 3,292,620 1,510 0.18%
Time deposits 3,791,362 12,208 1.30%
----------- ---------- ------
Total Interest-bearing Deposits 9,568,712 14,743 0.62%
Short-term borrowings 961,900 411 0.17%
Federal Home Loan Bank advances and
long-term debt 929,318 11,301 4.88%
----------- ---------- ------
Total Interest-bearing Liabilities 11,459,930 26,455 0.93%
Noninterest-bearing liabilities:
Demand deposits 2,669,152
Other 183,794
-----------
Total Liabilities 14,312,876
Shareholders' equity 2,046,317
-----------
Total Liabilities and Shareholders'
Equity $16,359,193
===========
Net interest income/net interest margin (fully
taxable equivalent) 141,714 3.78%
======
Tax equivalent adjustment (4,184)
----------
Net interest income $ 137,530
==========
Quarter Ended
---------------------------------
June 30, 2011
-------------------------------
Average Interest Yield/
Balance (1) Rate
----------- ---------- ------
ASSETS
Interest-earning assets:
Loans, net of unearned income $11,883,019 $ 151,974 5.13%
Taxable investment securities 2,141,307 20,749 3.88%
Tax-exempt investment securities 343,214 4,840 5.64%
Equity securities 128,258 775 2.42%
----------- ---------- ------
Total Investment Securities 2,612,779 26,364 4.04%
Loans held for sale 36,793 492 5.34%
Other interest-earning assets 163,548 101 0.25%
----------- ---------- ------
Total Interest-earning Assets 14,696,139 178,931 4.88%
Noninterest-earning assets:
Cash and due from banks 278,393
Premises and equipment 207,141
Other assets 1,098,116
Less: allowance for loan losses (273,593)
-----------
Total Assets $16,006,196
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Demand deposits $ 2,352,961 $ 1,371 0.23%
Savings deposits 3,356,361 3,258 0.39%
Time deposits 4,353,352 17,146 1.58%
----------- ---------- ------
Total Interest-bearing Deposits 10,062,674 21,775 0.87%
Short-term borrowings 455,831 168 0.15%
Federal Home Loan Bank advances and
long-term debt 1,025,637 12,347 4.82%
----------- ---------- ------
Total Interest-bearing Liabilities 11,544,142 34,290 1.19%
Noninterest-bearing liabilities:
Demand deposits 2,362,614
Other 162,202
-----------
Total Liabilities 14,068,958
Shareholders' equity 1,937,238
-----------
Total Liabilities and Shareholders'
Equity $16,006,196
===========
Net interest income/net interest margin
(fully taxable equivalent) 144,641 3.95%
======
Tax equivalent adjustment (3,996)
----------
Net interest income $ 140,645
==========
Quarter Ended
-------------------------------
March 31, 2012
-------------------------------
Average Interest Yield/
Balance (1) Rate
----------- ---------- ------
ASSETS
Interest-earning assets:
Loans, net of unearned income $11,978,972 $ 147,046 4.94%
Taxable investment securities 2,402,158 18,661 3.11%
Tax-exempt investment securities 294,724 4,157 5.64%
Equity securities 115,593 780 2.71%
----------- ---------- ------
Total Investment Securities 2,812,475 23,598 3.36%
Loans held for sale 40,478 431 4.26%
Other interest-earning assets 101,570 53 0.21%
----------- ---------- ------
Total Interest-earning Assets 14,933,495 171,128 4.61%
Noninterest-earning assets:
Cash and due from banks 263,128
Premises and equipment 212,567
Other assets 1,102,868
Less: allowance for loan losses (266,092)
-----------
Total Assets $16,245,966
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Demand deposits $ 2,464,452 $ 1,036 0.17%
Savings deposits 3,341,035 1,810 0.22%
Time deposits 3,951,908 13,404 1.36%
----------- ---------- ------
Total Interest-bearing Deposits 9,757,395 16,250 0.67%
Short-term borrowings 728,102 281 0.15%
Federal Home Loan Bank advances and
long-term debt 983,304 11,665 4.76%
----------- ---------- ------
Total Interest-bearing Liabilities 11,468,801 28,196 0.99%
Noninterest-bearing liabilities:
Demand deposits 2,565,089
Other 195,465
-----------
Total Liabilities 14,229,355
Shareholders' equity 2,016,611
-----------
Total Liabilities and Shareholders'
Equity $16,245,966
===========
Net interest income/net interest margin
(fully taxable equivalent) 142,932 3.85%
======
Tax equivalent adjustment (4,237)
----------
Net interest income $ 138,695
==========
(1) Presented on a tax-equivalent basis using a 35% Federal tax rate and
statutory interest expense disallowances.
AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:
Quarter Ended % Change from
----------------------------------- -------------------
June 30 June 30 March 31 June 30 March 31
2012 2011 2012 2011 2012
----------- ----------- ----------- -------- --------
Loans, by type:
Real estate -
commercial
mortgage $ 4,634,436 $ 4,430,046 $ 4,617,507 4.6% 0.4%
Commercial -
industrial,
financial and
agricultural 3,529,947 3,689,877 3,585,520 (4.3%) (1.5%)
Real estate -
home equity 1,599,702 1,623,438 1,611,565 (1.5%) (0.7%)
Real estate -
residential
mortgage 1,179,513 1,023,471 1,137,625 15.2% 3.7%
Real estate -
construction 640,282 712,638 641,574 (10.2%) (0.2%)
Consumer 307,071 332,960 311,592 (7.8%) (1.5%)
Leasing and
other 74,753 70,589 73,589 5.9% 1.6%
----------- ----------- -----------
Total Loans, net
of unearned
income $11,965,704 $11,883,019 $11,978,972 0.7% (0.1%)
=========== =========== ===========
Deposits, by type:
Noninterest-
bearing demand $ 2,669,152 $ 2,362,614 $ 2,565,089 13.0% 4.1%
Interest-bearing
demand 2,484,730 2,352,961 2,464,452 5.6% 0.8%
Savings deposits 3,292,620 3,356,361 3,341,035 (1.9%) (1.4%)
Time deposits 3,791,362 4,353,352 3,951,908 (12.9%) (4.1%)
----------- ----------- -----------
Total Deposits $12,237,864 $12,425,288 $12,322,484 (1.5%) (0.7%)
=========== =========== ===========
Short-term
borrowings, by
type:
Customer
repurchase
agreements $ 226,216 $ 217,657 $ 200,542 3.9% 12.8%
Customer short-
term promissory
notes 146,307 171,958 155,071 (14.9%) (5.7%)
Federal funds
purchased and
other 589,377 66,216 372,489 790.1% 58.2%
----------- ----------- -----------
Total Short-term
borrowings $ 961,900 $ 455,831 $ 728,102 111.0% 32.1%
=========== =========== ===========
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands
Six Months ended June 30
----------------------------------------------------------
2012 2011
---------------------------- ----------------------------
Average Interest Yield/ Average Interest Yield/
Balance (1) Rate Balance (1) Rate
----------- --------- ------ ----------- --------- ------
ASSETS
Interest-earning
assets:
Loans, net of
unearned
income $11,972,338 $ 291,309 4.89% $11,902,124 $ 303,660 5.14%
Taxable
investment
securities 2,467,609 37,285 3.02% 2,235,789 42,556 3.81%
Tax-exempt
investment
securities 289,230 8,149 5.63% 343,832 9,725 5.66%
Equity
securities 111,274 1,487 2.68% 130,537 1,527 2.35%
----------- --------- ------ ----------- --------- ------
Total
Investment
Securities 2,868,113 46,921 3.27% 2,710,158 53,808 3.97%
Loans held for
sale 48,145 969 4.02% 41,082 992 4.83%
Other
interest-
earning
assets 115,421 98 0.17% 115,233 134 0.23%
----------- --------- ------ ----------- --------- ------
Total
Interest-
earning
Assets 15,004,017 339,297 4.55% 14,768,597 358,594 4.89%
Noninterest-
earning assets:
Cash and due
from banks 248,278 269,444
Premises and
equipment 214,725 207,263
Other assets 1,098,269 1,100,319
Less:
allowance for
loan losses (262,709) (277,782)
----------- -----------
Total Assets $16,302,580 $16,067,841
=========== ===========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Interest-bearing
liabilities:
Demand
deposits $ 2,474,591 $ 2,061 0.17% $ 2,337,615 $ 2,807 0.24%
Savings
deposits 3,316,827 3,320 0.20% 3,319,778 6,616 0.40%
Time deposits 3,871,636 25,612 1.33% 4,442,446 35,638 1.62%
----------- --------- ------ ----------- --------- ------
Total
Interest-
bearing
Deposits 9,663,054 30,993 0.64% 10,099,839 45,061 0.90%
Short-term
borrowings 845,001 692 0.16% 538,786 422 0.16%
Federal Home
Loan Bank
advances and
long-term
debt 956,310 22,966 4.82% 1,043,481 24,938 4.80%
----------- --------- ------ ----------- --------- ------
Total
Interest-
bearing
Liabilities 11,464,365 54,651 0.96% 11,682,106 70,421 1.21%
Noninterest-
bearing
liabilities:
Demand
deposits 2,617,120 2,300,750
Other 189,631 166,541
----------- -----------
Total
Liabilities 14,271,116 14,149,397
Shareholders'
equity 2,031,464 1,918,444
----------- -----------
Total
Liabilities
and
Shareholders'
Equity $16,302,580 $16,067,841
=========== ===========
Net interest income/net
interest margin (fully
taxable equivalent) 284,646 3.81% 288,173 3.93%
====== ======
Tax equivalent
adjustment (8,421) (7,965)
--------- ---------
Net interest
income $ 276,225 $ 280,208
========= =========
(1) Presented on a tax-equivalent basis using a 35% Federal tax rate
and statutory interest expense disallowances.
AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:
Six Months Ended
June 30
-------------------------
2012 2011 % Change
------------ ------------ ----------
Loans, by type:
Real estate - commercial mortgage $ 4,625,969 $ 4,407,683 5.0%
Commercial - industrial, financial
and agricultural 3,557,731 3,698,430 (3.8%)
Real estate - home equity 1,605,633 1,625,980 (1.3%)
Real estate - residential mortgage 1,158,569 1,020,471 13.5%
Real estate - construction 640,928 745,912 (14.1%)
Consumer 309,331 337,080 (8.2%)
Leasing and other 74,177 66,568 11.4%
------------ ------------
Total Loans, net of unearned income $ 11,972,338 $ 11,902,124 0.6%
============ ============
Deposits, by type:
Noninterest-bearing demand $ 2,617,120 $ 2,300,750 13.8%
Interest-bearing demand 2,474,591 2,337,615 5.9%
Savings deposits 3,316,827 3,319,778 (0.1%)
Time deposits 3,871,636 4,442,446 (12.8%)
------------ ------------
Total Deposits $ 12,280,174 $ 12,400,589 (1.0%)
============ ============
Short-term borrowings, by type:
Customer repurchase agreements $ 213,379 $ 215,307 (0.9%)
Customer short-term promissory
notes 150,689 181,121 (16.8%)
Federal funds purchased and other 480,933 142,358 237.8%
------------ ------------
Total Short-term borrowings $ 845,001 $ 538,786 56.8%
============ ============
FULTON FINANCIAL CORPORATION
ASSET QUALITY INFORMATION (UNAUDITED)
dollars in thousands
Quarter Ended Six Months Ended
------------------------------- --------------------
June 30 June 30 Mar 31 June 30
2012 2011 2012 2012 2011
--------- --------- --------- --------- ---------
ALLOWANCE FOR CREDIT
LOSSES:
Balance at
beginning of
period $ 258,137 $ 271,156 $ 258,177 $ 258,177 $ 275,498
Loans charged off:
Real estate -
commercial
mortgage (23,699) (7,074) (11,891) (35,590) (17,121)
Commercial -
industrial,
financial and
agricultural (13,017) (15,406) (5,669) (18,686) (28,742)
Real estate -
construction (8,442) (7,468) (8,571) (17,013) (21,362)
Real estate -
home equity (2,789) (1,650) (2,206) (4,995) (3,118)
Real estate -
residential
mortgage (1,492) (7,707) (847) (2,339) (12,703)
Leasing and other (630) (689) (441) (1,071) (1,186)
Consumer (471) (681) (634) (1,105) (1,972)
--------- --------- --------- --------- ---------
Total loans
charged off (50,540) (40,675) (30,259) (80,799) (86,204)
Recoveries of loans
charged off:
Real estate -
commercial
mortgage 1,153 191 816 1,969 1,726
Commercial -
industrial,
financial and
agricultural 717 1,003 636 1,353 1,394
Real estate -
construction 1,539 79 64 1,603 642
Real estate -
home equity 278 2 20 298 3
Real estate -
residential
mortgage 71 190 73 144 234
Leasing and other 180 254 260 440 598
Consumer 281 433 350 631 742
--------- --------- --------- --------- ---------
Recoveries of
loans previously
charged off 4,219 2,152 2,219 6,438 5,339
--------- --------- --------- --------- ---------
Net loans charged
off (46,321) (38,523) (28,040) (74,361) (80,865)
Provision for
credit losses 25,500 36,000 28,000 53,500 74,000
--------- --------- --------- --------- ---------
Balance at end of
period $ 237,316 $ 268,633 $ 258,137 $ 237,316 $ 268,633
========= ========= ========= ========= =========
Net charge-offs to
average loans
(annualized) 1.55% 1.30% 0.94% 1.24% 1.36%
========= ========= ========= ========= =========
NON-PERFORMING
ASSETS:
Non-accrual loans $ 203,539 $ 274,973 $ 248,719
Loans 90 days past
due and accruing 30,434 35,869 35,270
--------- --------- ---------
Total non-
performing loans 233,973 310,842 283,989
Other real estate
owned 32,338 37,493 33,516
--------- --------- ---------
Total non-
performing assets $ 266,311 $ 348,335 $ 317,505
========= ========= =========
NON-PERFORMING LOANS,
BY TYPE:
Real estate -
commercial
mortgage $ 82,179 $ 102,724 $ 104,076
Commercial -
industrial,
financial and
agricultural 67,969 94,855 82,884
Real estate -
construction 43,124 58,381 59,917
Real estate -
residential
mortgage 25,373 43,200 23,016
Real estate - home
equity 11,472 9,440 10,914
Consumer 3,460 2,090 2,834
Leasing 396 152 348
--------- --------- ---------
Total non-
performing loans $ 233,973 $ 310,842 $ 283,989
========= ========= =========
DELINQUENCY RATES, BY TYPE:
June 30, 2012 June 30, 2011 March 31, 2012
------------------- ------------------- -------------------
> / = > / = > / =
31-89 90 Days 31-89 90 Days 31-89 90 Days
Days (1) Total Days (1) Total Days (1) Total
----- ------- ----- ----- ------- ----- ----- ------- -----
Real estate -
commercial
mortgage 0.41% 1.78% 2.19% 0.57% 2.32% 2.89% 0.43% 2.24% 2.67%
Commercial -
industrial,
financial and
agricultural 0.66% 1.91% 2.57% 0.54% 2.58% 3.12% 0.35% 2.36% 2.71%
Real estate -
construction 0.95% 6.96% 7.91% 0.62% 8.56% 9.18% 0.56% 9.25% 9.81%
Real estate -
residential
mortgage 2.94% 2.15% 5.09% 3.37% 4.22% 7.59% 2.76% 1.96% 4.72%
Real estate -
home equity 0.83% 0.71% 1.54% 0.74% 0.58% 1.32% 0.74% 0.68% 1.42%
Consumer,
leasing and
other 1.61% 0.99% 2.60% 1.22% 0.56% 1.78% 1.40% 0.84% 2.24%
----- ------- ----- ----- ------- ----- ----- ------- -----
Total 0.86% 1.95% 2.81% 0.85% 2.63% 3.48% 0.71% 2.38% 3.09%
===== ======= ===== ===== ======= ===== ===== ======= =====
(1) Includes non-accrual loans
ASSET QUALITY RATIOS:
June 30 June 30 Mar 31
2012 2011 2012
---------- ---------- ----------
Non-accrual loans to total loans 1.70% 2.32% 2.08%
Non-performing assets to total loans and
OREO 2.22% 2.93% 2.65%
Non-performing assets to total assets 1.63% 2.18% 1.92%
Allowance for credit losses to loans
outstanding 1.98% 2.27% 2.16%
Allowance for credit losses to non-
performing loans 101.43% 86.42% 90.90%
Non-performing assets to tangible common
shareholders' equity and allowance for
credit losses 15.34% 20.78% 18.27%
Media Contact:
Laura J. Wakeley
(717) 291-2616
Investor Contact:
David C. Hostetter
(717) 291-2456
Source: Fulton Financial Corporation