Solid Quarter for 1st Source Corporation, Dividend Declared
SOUTH BEND, Ind.--(BUSINESS WIRE)-- 1st Source Corporation (Nasdaq:SRCE), parent company of 1st Source Bank, today reported net income of $13.94 million for the second quarter of 2013, up 10.94% over the $12.57 million earned in the second quarter of 2012. Year to date, net income was $26.35 million, up 8.50% compared to the first six months of last year. Diluted net income per common share for the second quarter amounted to $0.56, up 9.80% compared to $0.51 for the second quarter of 2012. Diluted net income per common share for the first half of 2013 was $1.07, an increase of 8.08%, compared to the $0.99 earned a year earlier.
At its July meeting, the Board of Directors approved a cash dividend of $0.17 per common share. The dividend is payable to shareholders of record on August 5, 2013 and will be paid on August 15, 2013.
Christopher J. Murphy III, Chairman and Chief Executive Officer, commented, “The second quarter saw solid growth in loans and leases, deposits and total assets, as well as strong performance in our overall credit quality. The slowly improving economy and our focus on relationship banking are having a positive impact on our results. We are very pleased with the results of this quarter and the first six months.”
Mr. Murphy continued, “It was also a quarter to celebrate for additional reasons. In June, we kicked off the 150th anniversary of the Bank’s founding with an all-employee celebration. The event featured videos of our clients relating why we were important in their lives, some vintage television commercials showing how we presented ourselves to the market over the years, and a dynamic presentation on the philosophy of ethics and sustainable values as the basis for our next 150 years. The celebration culminated in an activity which demonstrated how all of our colleagues across the Bank are important and meaningful in connecting as a team to serve our clients and was a terrific way to start the Bank’s next 150 years.” Mr. Murphy concluded.
As of June 30, 2013, the 1st Source common equity-to-assets ratio was 12.24% compared to 12.09% a year ago and its tangible common equity to tangible assets ratio was 10.56% compared to 10.32% a year earlier. Total assets at June 30, 2013 were $4.64 billion, up 3.39% from a year earlier. Total loans and leases were $3.49 billion, up 6.81% from June 30, 2012. Total deposits were $3.70 billion, up 3.20% from the comparable figures at June 30, 2012.
The 1st Source reserve for loan and lease losses as of June 30, 2013 was 2.45% of total loans and leases compared to 2.55% at June 30, 2012. Net recoveries were $0.39 million in the second quarter 2013, compared with net charge-offs of $1.15 million in the same quarter a year ago. Year-to-date, net recoveries of $0.33 million have been recorded in 2013, compared to net charge-offs of $2.65 million for the first half of 2012. The ratio of nonperforming assets to net loans and leases was 1.01% as of June 30, 2013, down from 1.67% on June 30, 2012.
The net interest margin was 3.65% for the second quarter of 2012 versus 3.70% for the same period in 2012. The net interest margin was 3.64% for the six months ending June 30, 2013, versus 3.74% for the same period in 2012. Tax-equivalent net interest income was $39.32 million for the second quarter of 2013, compared to $38.50 million for 2012’s second quarter. For the first six months of 2013, tax-equivalent net interest income was $77.54 million, compared to $76.42 million for the first six months of 2012.
Noninterest income for the second quarter of 2013 was $20.12 million, up 1.67% from the same period in 2012. The increase for the quarter is mainly attributed to higher mortgage banking income. For the first six months of 2013, noninterest income was $39.07 million, down 3.09% compared to 2012. Noninterest income decreased primarily as a result of lower equipment rental income.
Noninterest expense was $35.74 million for the second quarter of 2013, down 2.28% from the second quarter of 2012. For the first six months of 2013, noninterest expense was $72.29 million, down 3.12% compared with $74.63 million for the same period in 2012. Noninterest expense decreased primarily as a result of lower salary and employee benefit expenses and reduced depreciation on leased equipment.
1st Source serves the northern half of Indiana and southwest Michigan with its community banking, insurance and wealth management services, and nationally and internationally with specialty financing and leasing services. 1st Source distinguishes itself with highly personalized service and a comprehensive range of consumer and commercial banking services delivered through its community bank offices. 1st Source Bank provides services for businesses nationally by offering specialized financing of automobiles for leasing and rental agencies, medium and heavy duty trucks, construction and environmental equipment, and nationally and internationally, for new and used private and cargo aircraft. The Corporation includes 76 community banking centers, 9 trust and wealth management locations, and 9 1st Source Insurance offices located within 17 counties of northern Indiana and southwestern Michigan and 22 specialty finance locations nationwide. With a history dating back to 1863, 1st Source Bank has a tradition of providing superior service to clients while playing a leadership role in assuring a strong social safety net and continued economic development in the communities it serves.
In addition to the results presented in accordance with generally accepted accounting principles in the United States of America, this press release contains certain non-GAAP financial measures. 1st Source Corporation believes that providing non-GAAP financial measures provides investors with information useful to understanding our financial performance. Additionally, these non-GAAP measures are used by management for planning and forecasting purposes, including measures based on “tangible equity” which is “common shareholders’ equity” excluding intangible assets.
1st Source may be accessed on its home page at “www.1stsource.com.” Its common stock is traded on the Nasdaq Global Select Market under "SRCE" and appears in the National Market System tables in many daily newspapers under the code name "1st Src". Except for historical information contained herein, the matters discussed in this document express “forward-looking statements.” Generally, the words “believe,” “contemplate,” “seek,” “plan,” “possible,” “assume,” “expect,” “intend,” “targeted,” “continue,” “remain,” “estimate,” “anticipate,” “project,” “will,” “should,” “indicate,” “would,” “may” and similar expressions indicate forward-looking statements. Those statements, including statements, projections, estimates or assumptions concerning future events or performance, and other statements that are other than statements of historical fact, are subject to material risks and uncertainties. 1st Source cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date made.
1st Source may make other written or oral forward-looking statements from time to time. Readers are advised that various important factors could cause 1st Source’s actual results or circumstances for future periods to differ materially from those anticipated or projected in such forward-looking statements. Such factors, among others, include changes in laws, regulations or accounting principles generally accepted in the United States; 1st Source’s competitive position within its markets served; increasing consolidation within the banking industry; unforeseen changes in interest rates; unforeseen downturns in the local, regional or national economies or in the industries in which 1st Source has credit concentrations; and other risks discussed in 1st Source’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, which filings are available from the SEC. 1st Source undertakes no obligation to publicly update or revise any forward-looking statements.
Media contact: Andrea Short, (574) 235-2000