SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): July 23, 2003
|
INDEPENDENT BANK CORPORATION
(Exact name of registrant as specified in its charter) |
| Michigan
(State or Jurisdiction of Incorporation or Organization) |
|
0-7818
(Commission File Number) |
38-2032782
(I.R.S. Employer Identification No.) |
|
230 West Main Street, Ionia, Michigan 48846
(Address of principal executive offices) |
(616) 527-9450
(Registrant's telephone number, including area code)
|
NONE
Former name, address and fiscal year, if changed since last report. |
Item 7. Financial Statements and Exhibits.
Exhibit
99 Supplemental data to the Registrant’s press release dated July 23, 2003.
Item 9. Regulation FD Disclosure.
The
information attached at Exhibit 99 is supplemental data to the Registrant’s press
release dated July 23, 2003 regarding its earnings during the quarter ended
June 30, 2003.
This information furnished under "Item 9. Regulation FD Disclosure"
is intended to be furnished under "Item 12. Results of Operations and
Financial Condition" in accordance with SEC Release No. 33-8216.
The information in this Form 8-K and the attached Exhibit shall not be
deemed filed for purposes of Section 18 of the Securities Act of 1934,
nor shall it be deemed incorporated by reference in any filing under the
Securities Act of 1933, except as shall be expressly set forth by
specific reference in such filing.
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Date |
July 23, 2003
|
By |
s/ Robert N. Shuster
Robert N. Shuster, Principal Financial Officer |
|
| Date |
July 23, 2003
|
By |
s/ James J. Twarozynski
James J. Twarozynski, Principal Accounting Officer |
3
| INDEPENDENT BANK CORPORATION AND SUBSIDIARIES Consolidated Statements of Financial Condition |
Exhibit 99 |
June 30, December 31,
2003 2002
---------------- ----------------
(unaudited)
----------------------------------
Assets (in thousands)
Cash and due from banks $ 73,114 $ 60,731
Securities available for sale 429,606 371,246
Federal Home Loan Bank stock, at cost 12,032 9,704
Loans held for sale 131,174 129,577
Loans
Commercial 581,832 536,715
Real estate mortgage 607,968 601,799
Installment 235,907 242,928
Finance Receivables 108,704
------------- --------------
Total Loans 1,534,411 1,381,442
Allowance for loan losses (17,880) (16,705)
------------- --------------
Net Loans 1,516,531 1,364,737
Property and equipment, net 42,260 40,735
Bank owned life insurance 36,184 35,415
Goodwill 16,244 7,299
Other intangibles 8,510 6,420
Accrued income and other assets 34,626 31,698
------------- --------------
Total Assets $ 2,300,281 $ 2,057,562
============= ==============
Liabilities and Shareholders' Equity
Deposits
Non-interest bearing $ 218,936 $ 179,871
Savings and NOW 679,919 657,530
Time 754,541 698,202
------------- --------------
Total Deposits 1,653,396 1,535,603
Federal funds purchased 42,300 23,840
Other borrowings 341,459 310,413
Guaranteed preferred beneficial interests in Company's subordinated
debentures 50,600 17,250
Accrued expenses and other liabilities 59,018 32,409
------------- --------------
Total Liabilities 2,146,773 1,919,515
------------- --------------
Shareholders' Equity
Preferred stock, no par value--200,000 shares authorized; none
outstanding
Common stock, $1.00 par value--30,000,000 shares authorized;
issued and outstanding: 17,880,811 shares at June 30, 2003
and 17,822,090 shares at December 31, 2002 17,881 17,822
Capital surplus 74,352 75,076
Retained earnings 54,351 41,785
Accumulated other comprehensive income 6,924 3,364
------------- --------------
Total Shareholders' Equity 153,508 138,047
------------- --------------
Total Liabilities and Shareholders' Equity $ 2,300,281 $ 2,057,562
============= ==============
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
Three Months Ended Six Months Ended
June 30, June 30,
2003 2002 2003 2002
----------- ------------ ------------ -----------
(unaudited) (unaudited)
------------------------- -------------------------
Interest Income (in thousands, except per share amounts)
Interest and fees on loans $ 30,444 $ 26,849 $ 57,105 $ 53,903
Securities available for sale
Taxable 2,949 3,315 5,848 6,026
Tax-exempt 1,930 1,757 3,848 3,400
Other investments 135 334 277 647
----------- ------------ ------------ -----------
Total Interest Income 35,458 32,255 67,078 63,976
----------- ------------ ------------ -----------
Interest Expense
Deposits 7,430 9,042 14,601 17,668
Other borrowings 4,561 2,970 8,203 6,598
----------- ------------ ------------ -----------
Total Interest Expense 11,991 12,012 22,804 24,266
----------- ------------ ------------ -----------
Net Interest Income 23,467 20,243 44,274 39,710
Provision for loan losses 710 1,166 1,710 2,093
----------- ------------ ------------ -----------
Net Interest Income After Provision for Loan Losses 22,757 19,077 42,564 37,617
----------- ------------ ------------ -----------
Non-interest Income
Service charges on deposit accounts 3,677 3,241 6,948 5,953
Net gains on asset sales
Real estate mortgage loans 4,317 1,238 8,349 3,044
Securities 47 210 559 176
Title insurance fees 907 464 1,650 1,087
Manufactured home loan origination fees
and commissions 389 493 747 927
Real estate mortgage loan service fees, net (1,047) 273 (1,397) 568
Other income 2,121 1,666 3,970 2,955
----------- ------------ ------------ -----------
Total Non-interest Income 10,411 7,585 20,826 14,710
----------- ------------ ------------ -----------
Non-interest Expense
Compensation and employee benefits 10,795 9,262 20,436 18,050
Occupancy, net 1,626 1,344 3,224 2,650
Furniture and fixtures 1,424 1,144 2,744 2,250
Other expenses 6,802 4,754 12,298 9,296
----------- ------------ ------------ -----------
Total Non-interest Expense 20,647 16,504 38,702 32,246
----------- ------------ ------------ -----------
Income Before Income Tax 12,521 10,158 24,688 20,081
Income tax expense 3,390 2,870 6,740 5,684
----------- ------------ ------------ -----------
Net Income $ 9,131 $ 7,288 $ 17,948 $ 14,397
=========== ============ ============ ===========
Net Income Per Share
Basic $ .51 $ .39 $ 1.00 $ .78
Diluted .50 .39 .98 .76
Dividends Per Common Share
Declared $ .16 $ .11 $ .30 $ .23
Paid .16 .11 .30 .23
2
Non-performing assets
June 30, December 31,
2003 2002
----------------- -----------------
(dollars in thousands)
Non-accrual loans $4,816 $5,738
Loans 90 days or more past due and
still accruing interest 3,201 3,961
Restructured loans 161 270
----------------- -----------------
Total non-performing loans 8,178 9,969
Other real estate 3,320 3,908
----------------- -----------------
Total non-performing assets $11,498 $13,877
================= =================
As a percent of Portfolio Loans
Non-performing loans 0.53 % 0.72 %
Allowance for loan losses 1.17 1.21
Non-performing assets to total assets 0.50 0.67
Allowance for loan losses as a percent of
non-performing loans 219 168
Six months ended
June 30,
2003 2002
------------ -------------
(in thousands)
Balance at beginning of period $16,705 $16,167
Additions (deduction)
Allowance on loans acquired 517
Provision charged to operating expense 1,710 2,093
Recoveries credited to allowance 564 395
Loans charged against the allowance (1,616) (1,161)
------------- ------------
Balance at end of period $17,880 $17,494
============= ============
Net loans charged against the allowance to
average Portfolio Loans (annualized) 0.15 % 0.11 %
June 30, 2003 December 31, 2002
-------------------------------- ----------------------------------
Average Average
Amount Maturity Rate Amount Maturity Rate
-------------------------------- ----------------------------------
(dollars in thousands)
Brokered CDs(1) $346,830 1.8 years 2.46% $278,012 1.9 years 3.03%
Fixed rate FHLB advances(1) 78,786 6.2 years 4.96 62,861 7.9 years 5.83
Variable rate FHLB advances(1) 123,300 0.4 years 1.37 131,200 0.3 years 1.50
Securities sold under agreements to
Repurchase(1) 136,116 0.2 years 1.33 98,712 0.1 years 1.74
Federal funds purchased 42,300 1 day 1.48 23,840 1 day 1.38
-------------------------------- ----------------------------------
Total $727,332 1.6 years 2.28% $594,625 1.8 years 2.71%
================================ ==================================
(1) Certain of these items have had their average maturity and rate altered through the use of derivative instruments, including pay-fixed and pay-variable interest rate swaps.
3
June 30, December 31,
2003 2002
------------------- -------------------
(in thousands)
Unsecured debt $12,600
-------------------
Preferred Securities $ 50,600 17,250
------------------- -------------------
Shareholders' Equity
Preferred stock, no par value
Common Stock, par value $1.00 per share 17,881 17,822
Capital surplus 74,352 75,076
Retained earnings 54,351 41,785
Accumulated other comprehensive income (loss) 6,924 3,364
------------------- -------------------
Total shareholders' equity 153,508 138,047
------------------- -------------------
Total capitalization $204,108 $167,897
=================== ===================
Three months ended Six months ended
June 30, June 30,
2003 2002 2003 2002
----------- ----------- ----------- -----------
(in thousands)
Service charges on deposit accounts $3,677 $3,241 $6,948 $5,953
Net gains on asset sales
Real estate mortgage loans 4,317 1,238 8,349 3,044
Securities 47 210 559 176
Title insurance fees 907 464 1,650 1,087
Bank owned life insurance 364 742
Manufactured home loan origination fees
and commissions 389 493 747 927
Mutual fund and annuity commissions 334 349 590 578
Real estate mortgage loan servicing fees, net (1,047) 273 (1,397) 568
Other 1,423 1,317 2,638 2,377
----------- ----------- ----------- -----------
Total non-interest income $10,411 $7,585 $20,826 $14,710
=========== =========== =========== ===========
4
Three months ended Six months ended
June 30, June 30,
2003 2002 2003 2002
-------------- ------------- ------------- --------------
(in thousands)
Real estate mortgage loans originated $363,083 $152,759 $625,211 $293,479
Real estate mortgage loans sold 242,508 91,500 472,252 243,320
Real estate mortgage loans sold with servicing
rights released 13,958 9,158 30,715 21,495
Net gains on the sale of real estate mortgage loans 4,317 1,238 8,349 3,044
Net gains as a percent of real estate mortgage
loans sold ("Loan Sale Margin") 1.78% 1.35% 1.77% 1.25%
SFAS #133 adjustments included in the Loan
Sale Margin 0.15% (0.22)% 0.18% (0.10)%
Three months ended Six months ended
June 30, June 30,
2003 2002 2003 2002
--------------- --------------- --------------- ----------------
(in thousands)
Salaries $ 6,972 $ 6,312 $13,263 $ 12,130
Performance-based compensation
and benefits 1,586 1,359 2,890 2,549
Other benefits 2,237 1,591 4,283 3,371
--------------- --------------- --------------- ---------------
Compensation and employee
benefits 10,795 9,262 20,436 18,050
Occupancy, net 1,626 1,344 3,224 2,650
Furniture and fixtures 1,424 1,144 2,744 2,250
Data processing 973 714 1,896 1,427
Communications 712 567 1,396 1,213
Advertising 974 565 1,743 1,177
Loan and collection 889 710 1,831 1,215
Supplies 495 338 959 671
Amortization of intangible assets 458 246 734 492
Other 2,301 1,614 3,739 3,101
--------------- --------------- --------------- ---------------
Total non-interest expense $20,647 $16,504 $38,702 $32,246
=============== =============== =============== ===============
5
Three Months Ended
June 30,
2003 2002
------------------------------------ ------------------------------------------
Average Average
Balance Interest Rate Balance Interest Rate
----------- ---------- -------- ------------ ---------- --------
Assets (dollars in thousands)
Taxable loans (1) $ 1,597,452 $ 30,289 7.60 % $ 1,376,832 $ 26,694 7.77 %
Tax-exempt loans (1,2) 11,802 238 8.09 11,377 239 8.43
Taxable securities 250,058 2,949 4.73 226,411 3,315 5.87
Tax-exempt securities (2) 168,758 3,063 7.28 142,976 2,772 7.78
Other investments 11,847 135 4.57 21,521 334 6.22
---------- --------- ---------- ---------
Interest Earning Assets 2,039,917 36,674 7.20 1,779,117 33,354 7.51
--------- ---------
Cash and due from banks 49,960 38,881
Other assets, net 120,133 64,825
---------- ----------
Total Assets $ 2,210,010 $ 1,882,823
========== ==========
Liabilities
Savings and NOW $ 683,172 1,377 0.81 $ 633,074 1,936 1.23
Time deposits 749,204 6,053 3.24 686,774 7,106 4.15
Other borrowings 396,414 4,561 4.61 250,793 2,970 4.75
---------- --------- ---------- ---------
Interest Bearing Liabilities 1,828,790 11,991 2.63 1,570,641 12,012 3.07
--------- ---------
Demand deposits 175,549 149,040
Other liabilities 55,363 26,592
Shareholders' equity 150,308 136,550
---------- ----------
Total liabilities and shareholders' equity $ 2,210,010 $ 1,882,823
========== ==========
Tax Equivalent Net Interest Income $ 24,683 $ 21,342
========= =========
Tax Equivalent Net Interest Income
as a Percent of Earning Assets 4.85 % 4.80 %
======= =======
| (1) | All domestic |
| (2) | Interest on tax-exempt loans and securities is presented on a fully tax equivalent basis assuming a marginal tax rate of 35% |
6
Six Months Ended
June 30,
2003 2002
------------------------------------ ------------------------------------------
Average Average
Balance Interest Rate Balance Interest Rate
----------- ---------- -------- ------------ ---------- --------
Assets (dollars in thousands)
Taxable loans (1) $ 1,532,855 $ 56,793 7.44 % $ 1,391,212 $ 53,591 7.74 %
Tax-exempt loans (1,2) 11,894 480 8.14 11,500 480 8.42
Taxable securities 230,193 5,848 5.12 204,102 6,026 5.95
Tax-exempt securities (2) 167,006 6,100 7.37 138,036 5,362 7.83
Other investments 10,983 277 5.09 21,558 647 6.05
---------- --------- ---------- ---------
Interest Earning Assets 1,952,931 69,498 7.15 1,766,408 66,106 7.52
--------- ---------
Cash and due from banks 45,379 38,466
Other assets, net 112,760 65,257
---------- ----------
Total Assets $ 2,111,070 $ 1,870,131
========== ==========
Liabilities
Savings and NOW $ 681,282 2,797 0.83 $ 628,468 3,900 1.25
Time deposits 706,156 11,804 3.37 663,542 13,768 4.18
Long-term debt
Other borrowings 366,713 8,203 4.51 269,527 6,598 4.94
---------- --------- ---------- ---------
Interest Bearing Liabilities 1,754,151 22,804 2.62 1,561,537 24,266 3.13
--------- ---------
Demand deposits 167,646 145,978
Other liabilities 43,115 26,807
Shareholders' equity 146,158 135,809
---------- ----------
Total liabilities and shareholders' equity $ 2,111,070 $ 1,870,131
========== ===========
Tax Equivalent Net Interest Income $ 46,694 $ 41,840
========= =========
Tax Equivalent Net Interest Income
as a Percent of Earning Assets 4.80 % 4.75 %
======= =======
| (1) | All domestic |
| (2) | Interest on tax-exempt loans and securities is presented on a fully tax equivalent basis assuming a marginal tax rate of 35% |
7