Exhibit 1.
FOR IMMEDIATE RELEASE
October 15, 2003
FOR ADDITIONAL INFORMATION PLEASE CONTACT JEAN R. HALE, VICE CHAIRMAN, PRESIDENT, AND C.E.O., COMMUNITY TRUST BANCORP, INC. AT (606) 437-3294
Community Trust Bancorp, Inc. reports third quarter 2003 earnings of $7.3 million or $0.60 per share.
|
Earnings Summary |
|
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|||||
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|
|
|
|
|
|||||
|
3Q 2003 |
2Q 2003 |
3Q 2002 |
9 Months 2003 |
9 Months 2002 |
||||||
|
Net income (in thousands) |
$ |
7,281 |
$ |
7,064 |
$ |
7,933 |
$ |
21,338 |
$ |
20,632 |
|
Earnings per share |
$ |
0.60 |
$ |
0.58 |
$ |
0.64 |
$ |
1.74 |
$ |
1.65 |
|
Earnings per share (diluted) |
$ |
0.59 |
$ |
0.57 |
$ |
0.63 |
$ |
1.72 |
$ |
1.63 |
|
Return on average assets |
1.15% |
1.14% |
1.30% |
1.15% |
1.12% |
|||||
|
Return on average equity |
13.45% |
13.27% |
15.32% |
13.37% |
13.74% |
|||||
|
Efficiency ratio |
58.84% |
56.95% |
55.92% |
59.17% |
56.74% |
|||||
|
Dividends declared per share |
$ |
0.23 |
$ |
0.21 |
$ |
0.19 |
$ |
0.65 |
$ |
0.57 |
|
Book value per share |
$ |
17.62 |
$ |
17.47 |
$ |
16.65 |
||||
Community Trust Bancorp, Inc. (NASDAQ-CTBI) is reporting third quarter 2003 earnings of $7.3 million or $0.60 per share compared to $7.1 million or $0.58 per share earned during the second quarter of 2003 and $7.9 million or $0.64 per share earned during the third quarter of 2002. Third quarter 2002 earnings of $0.64 per share included $0.08 per share due to gains on sale of securities compared to $0.03 per share for the third quarter 2003. Earnings for the nine months ended September 30, 2003 were $21.3 million or $1.74 per share, a 5.5% increase from the $20.6 million or $1.65 per share earned during the first nine months of 2002.
Return on average assets for the quarter ended September 30, 2003 was 1.15% compared to 1.14% for the second quarter 2003 and 1.30% for the third quarter 2002. Return on average assets for the nine months ended September 30, 2003 increased 2.7% to 1.15% compared to 1.12% for the nine months ended September 30, 2002. Return on average shareholders' equity for the quarter ended September 30, 2003 was 13.45% compared to 13.27% for the quarter ended June 30, 2003 and 15.32% for the quarter ended September 30, 2002. Return on average shareholders' equity for the nine months ended September 30, 2003 was 13.37% compared to 13.74% for the nine months ended September 30, 2002. CTBI's efficiency ratio for the quarter ended September 30, 2003 was 58.84% compared to 55.92% for the same period in 2002.
New Branch Opening
The Company is pleased to announce the opening of an additional branch in Lexington, Kentucky on October 6, 2003. The Company expects to open three new branches in the Company's Central Kentucky region during the first half of 2004.
Balance Sheet Review
The Company's assets increased 3.3% to $2.5 billion at September 30, 2003 from $2.4 billion at September 30, 2002. The Company experienced an increase of $43 million in loans outstanding during the third quarter of 2003 as growth occurred in all three major loan categories, commercial, residential real estate, and consumer loans. The loan portfolio increased 3.3% to $1.7 billion from the $1.6 billion at September 30, 2002. Total deposits of $2.1 billion at September 30, 2003 represents an increase in deposits of $34 million from September 30, 2002. The Company continues to have a high level of liquidity since investment opportunities are limited with interest rates at 45-year lows.
Nonperforming loans decreased 12.6% to $24.9 million from the $28.5 million at September 30, 2002 and increased 3.3% from the $24.1 million at June 30, 2003. Specific reserves are established for all large loans where management believes a loss may occur; therefore, no significant losses are anticipated except for those loans with specific reserve allocations.
Foreclosed properties on September 30, 2003 were $3.7 million, an increase from the $3.5 million reported at June 30, 2003. Foreclosed properties consist primarily of 1-4 family residential real estate.
The Company's continuing focus on loan portfolio quality is evident as net charge-offs for the quarter ended September 30, 2003 of $1.5 million, an annualized rate of 0.4% of average loans, are approximately 50% less than the $3.0 million or 0.7% of average loans for the third quarter of 2002 and 56% less than the $3.4 million or 0.8% of average loans for the second quarter of 2003. The reduction in net charge-offs had a positive impact by decreasing our loan loss provision by $1.5 million during the quarter ended September 30, 2003 compared to June 30, 2003 and $1.2 million for the nine months ended September 30, 2003 compared to the same period in 2002. Our reserve for losses on loans as a percentage of total loans outstanding at September 30, 2003 remained flat to prior quarter at 1.42% and decreased from 1.46% at September 30, 2002.
The Company continues to grow its shareholders' equity while also providing a dividend yield of 3.03% to shareholders. Shareholders' equity of $215.3 million on September 30, 2003 is a 4.5% increase from the $206.0 million on September 30, 2002.
Net Interest Income
Our net interest margin of 3.62% for the quarter ended September 30, 2003 is a 13 basis point decrease from the 3.75% for the quarter ended June 30, 2003 and a 44 basis point decrease from the 4.06% for the quarter ended September 30, 2002. After the June 25, 2003 reduction in interest rates by the Federal Reserve, the Company's loans repriced more quickly than its deposits, resulting in pressure on the net interest margin during the third quarter of 2003. Management expects some improvement in its net interest margin during the fourth quarter of 2003 as deposits continue to reprice.
Noninterest Income
Noninterest income increased 16.2% for the quarter ended September 30, 2003 to $10.1 million from the $8.7 million earned during the same period in 2002. The change in noninterest income from prior year is primarily the result of increases in gains on sales of residential real estate loans due to increased refinancing activity, deposit service charge revenue, and other noninterest income consisting primarily of sold loan servicing fee income. These increases were offset by decreased securities gains. This resulted in a positive after-tax impact on quarter and year-to-date 2003 earnings of $0.9 million or $0.07 per share and $5.5 million or $0.45 per share, respectively. Gains on the sale of securities contributed $0.3 million or $0.03 per share to earnings for the third quarter 2003 and $2.0 million or $0.16 per share year-to-date compared to $1.0 million or $0.08 per share for the same periods in 2002. Gains on sales of loans increased for the third quarter and year-to-date 2003 contributing $1.0 million or $0.09 per share and $3.1 million or $0.25 per share, respectively, to net income, compared to $0.7 million or $0.06 per share and $1.5 million or $0.12 per share for the same periods in 2002. The increase in sold loan servicing fee income is due to the recapture of $0.7 million pre-tax from our valuation reserve because of the improvement in the fair market value of our capitalized mortgage servicing rights. The impact to earnings per share for the quarter ended September 30, 2003 was $0.04 per share.
Noninterest Expense
Noninterest expense increased 7.9% from the $16.8 million for the third quarter 2002 to $18.1 million for the third quarter 2003. The increase in noninterest expense from prior year was primarily attributable to increases in professional fees, operating losses, and other noninterest expense.
Forward-Looking Statements
Certain of the statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. The Company's actual results may differ materially from those included in the forward-looking statements. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intend," "estimate," "may increase," "may fluctuate," and similar expressions or future or conditional verbs such as "will," "should," "would," and "could." These forward-looking statements involve risks and uncertainties including, but not limited to, economic conditions, portfolio growth, the credit performance of the portfolios, including bankruptcies, and seasonal factors; changes in general economic conditions including the performance of financial markets, the performance of coal and coal related industries, prevailing inflation and interest rates, realized gains from sales of investments, gains from asset sales, and losses on commercial lending activities; results of various investment activities; the effects of competitors' pricing policies, of changes in laws and regulations on competition and of demographic changes on target market populations' savings and financial planning needs; industry changes in information technology systems on which we are highly dependent; failure of acquisitions to produce revenue enhancements or cost savings at levels or within the time frames originally anticipated or unforeseen integration difficulties; the adoption by the Company of an FFIEC policy that provides guidance on the reporting of delinquent consumer loans and the timing of associated credit charge-offs for financial institution subsidiaries; and the resolution of legal proceedings and related matters. In addition, the banking industry in general is subject to various monetary and fiscal policies and regulations, which include those determined by the Federal Reserve Board, the Federal Deposit Insurance Corporation, and state regulators, whose policies and regulations could affect the Company's results. These statements are representative only on the date hereof, and the Company undertakes no obligation to update any forward-looking statements made.
Community Trust Bancorp, Inc., with assets of $2.5 billion, is headquartered in Pikeville, Kentucky and has 69 banking locations across eastern, northern, central, and south central Kentucky, and 5 banking locations in southern West Virginia.
Additional information follows.
Community Trust Bancorp, Inc.
Financial Summary (Unaudited)
September 30, 2003
|
(in thousands except per share data ) |
Three Months Ended 9/30/03 |
Three Months Ended 6/30/03 |
Three Months Ended 9/30/02 |
Nine Months Ended 9/30/03 |
Nine Months Ended 9/30/02 |
||||||||||
|
Interest income |
$ |
31,420 |
$ |
32,688 |
$ |
35,924 |
$ |
96,775 |
$ |
111,789 |
|||||
|
Interest expense |
|
10,644 |
|
11,670 |
|
13,564 |
|
34,453 |
|
44,209 |
|||||
|
Net interest income |
|
20,776 |
|
21,018 |
|
22,360 |
|
62,322 |
|
67,580 |
|||||
|
Loan loss provision |
|
2,085 |
|
3,585 |
|
2,530 |
|
7,217 |
|
8,416 |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Securities gains |
|
476 |
|
1,587 |
|
1,528 |
|
3,042 |
|
1,528 |
|||||
|
Gains on sales of loans |
|
1,613 |
|
1,595 |
|
1,016 |
|
4,729 |
|
2,347 |
|||||
|
Deposit service charges |
|
4,483 |
|
4,300 |
|
3,631 |
|
12,645 |
|
9,306 |
|||||
|
Trust revenue |
|
604 |
|
634 |
|
546 |
|
1,851 |
|
1,702 |
|||||
|
Insurance commissions |
|
257 |
|
138 |
|
147 |
|
497 |
|
250 |
|||||
|
Other noninterest income |
|
2,660 |
|
1,331 |
|
1,819 |
|
5,460 |
|
4,590 |
|||||
|
Total noninterest income |
|
10,093 |
|
9,585 |
|
8,687 |
|
28,224 |
|
19,723 |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Personnel expense |
|
8,705 |
|
7,838 |
|
8,742 |
|
25,604 |
|
25,594 |
|||||
|
Occupancy and equipment |
|
2,377 |
|
2,414 |
|
2,317 |
|
7,091 |
|
6,849 |
|||||
|
Amortization of core deposit intangible |
|
145 |
|
145 |
|
145 |
|
435 |
|
435 |
|||||
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Other noninterest expense |
|
6,884 |
|
6,367 |
|
5,579 |
|
19,356 |
|
16,612 |
|||||
|
Total noninterest expense |
|
18,111 |
|
16,764 |
|
16,783 |
|
52,486 |
|
49,490 |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net income before taxes |
|
10,673 |
|
10,254 |
|
11,734 |
|
30,843 |
|
29,397 |
|||||
|
Income taxes |
|
3,392 |
|
3,190 |
|
3,801 |
|
9,505 |
|
8,765 |
|||||
|
Net income |
$ |
7,281 |
$ |
7,064 |
$ |
7,933 |
$ |
21,338 |
$ |
20,632 |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Memo: TEQ interest income |
$ |
31,806 |
$ |
33,107 |
$ |
36,417 |
$ |
97,978 |
$ |
113,238 |
|||||
|
|
|
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|
|
|
|
|
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|
|||||
|
Average shares outstanding |
|
12,207 |
|
12,253 |
|
12,452 |
|
12,255 |
|
12,517 |
|||||
|
Basic earnings per share |
$ |
0.60 |
$ |
0.58 |
$ |
0.64 |
$ |
1.74 |
$ |
1.65 |
|||||
|
Diluted earnings per share |
$ |
0.59 |
$ |
0.57 |
$ |
0.63 |
$ |
1.72 |
$ |
1.63 |
|||||
|
Dividends per share |
$ |
0.23 |
$ |
0.21 |
$ |
0.19 |
$ |
0.65 |
$ |
0.57 |
|||||
|
Average balances: |
|||||||||||||||
|
Loans, net of unearned income |
$ |
1,659,808 |
$ |
1,640,312 |
$ |
1,647,011 |
$ |
1,641,067 |
$ |
1,668,194 |
|||||
|
Earning assets |
2,316,603 |
2,290,802 |
2,232,150 |
2,292,061 |
2,271,065 |
||||||||||
|
Total assets |
2,514,735 |
2,489,213 |
2,425,907 |
2,490,872 |
2,469,486 |
||||||||||
|
Deposits |
2,130,906 |
2,117,223 |
2,075,122 |
2,116,108 |
2,113,194 |
||||||||||
|
Interest bearing liabilities |
1,933,207 |
1,926,411 |
1,894,945 |
1,925,107 |
1,941,248 |
||||||||||
|
Shareholders' equity |
214,703 |
213,481 |
205,460 |
213,367 |
200,810 |
||||||||||
|
Performance ratios: |
|||||||||||||||
|
Return on average assets |
1.15 |
% |
1.14 |
% |
1.30 |
% |
1.15 |
% |
1.12 |
% |
|||||
|
Return on average equity |
13.45 |
% |
13.27 |
% |
15.32 |
% |
13.37 |
% |
13.74 |
% |
|||||
|
Yield on average earning assets |
5.45 |
% |
5.80 |
% |
6.47 |
% |
5.72 |
% |
6.67 |
% |
|||||
|
Cost of interest bearing funds |
2.18 |
% |
2.43 |
% |
2.84 |
% |
2.39 |
% |
3.04 |
% |
|||||
|
Net interest margin |
3.62 |
% |
3.75 |
% |
4.06 |
% |
3.71 |
% |
4.06 |
% |
|||||
|
Efficiency ratio |
58.84 |
% |
56.95 |
% |
55.92 |
% |
59.17 |
% |
56.74 |
% |
|||||
|
Loan charge-offs |
$ |
(2,484) |
$ |
(4,136) |
$ |
(3,853) |
$ |
(9,457) |
$ |
(11,246) |
|||||
|
Recoveries |
1,008 |
749 |
851 |
2,785 |
2,875 |
||||||||||
|
Net charge-offs |
$ |
(1,476) |
$ |
(3,387) |
$ |
(3,002) |
$ |
(6,672) |
$ |
(8,371) |
|||||
|
Market price: |
|||||||||||||||
|
High |
$ |
31.09 |
$ |
30.00 |
$ |
25.46 |
$ |
31.09 |
$ |
26.79 |
|||||
|
Low |
$ |
26.14 |
$ |
25.25 |
$ |
20.59 |
$ |
24.70 |
$ |
19.79 |
|||||
|
Close |
$ |
29.07 |
$ |
26.16 |
$ |
24.46 |
$ |
29.07 |
$ |
24.46 |
|||||
Community Trust Bancorp, Inc.
Financial Summary (Unaudited)
September 30, 2003
|
(in thousands except FTEs) |
As of 9/30/03 |
As of 6/30/03 |
As of 9/30/02 |
||||||
|
Assets: |
|
|
|
||||||
|
Loans, net of unearned |
$ |
1,682,346 |
$ |
1,639,804 |
$ |
1,628,127 |
|||
|
Loan loss reserve |
|
(23,816) |
|
(23,206) |
|
(23,694) |
|||
|
Net loans |
1,658,530 |
1,616,598 |
1,604,433 |
||||||
|
Loans held for sale |
|
3,973 |
|
8,503 |
|
11,434 |
|||
|
Securities available-for-sale |
|
518,690 |
|
466,150 |
|
475,776 |
|||
|
Securities held-to-maturity |
|
90,846 |
|
112,870 |
|
54,655 |
|||
|
Other earning assets |
|
1,282 |
|
67,499 |
|
46,532 |
|||
|
Cash and due from banks |
|
72,396 |
|
83,471 |
|
73,599 |
|||
|
Premises and equipment |
|
49,632 |
|
49,498 |
|
50,554 |
|||
|
Goodwill and core deposit intangible |
|
64,096 |
|
64,241 |
|
64,676 |
|||
|
Other assets |
|
40,895 |
|
38,195 |
|
39,729 |
|||
|
Total Assets |
$ |
2,500,340 |
$ |
2,507,025 |
$ |
2,421,389 |
|||
|
|
|
|
|
|
|
|
|||
|
Liabilities and Equity: |
|
|
|
|
|
|
|||
|
NOW accounts |
$ |
14,327 |
$ |
15,538 |
$ |
16,004 |
|||
|
Savings deposits |
|
608,360 |
|
614,532 |
|
614,727 |
|||
|
CDs >=$100,000 |
|
365,332 |
|
361,301 |
|
352,336 |
|||
|
Other time deposits |
|
775,683 |
|
791,130 |
|
776,575 |
|||
|
Total interest bearing deposits |
|
1,763,702 |
|
1,782,501 |
|
1,759,642 |
|||
|
Noninterest bearing deposits |
|
343,917 |
|
347,570 |
|
313,719 |
|||
|
Total deposits |
|
2,107,619 |
|
2,130,071 |
|
2,073,361 |
|||
|
Other interest bearing liabilities |
|
156,521 |
|
145,726 |
|
123,880 |
|||
|
Noninterest bearing liabilities |
|
20,899 |
|
18,170 |
|
18,162 |
|||
|
Total liabilities |
|
2,285,039 |
|
2,293,967 |
|
2,215,403 |
|||
|
Shareholders' equity |
|
215,301 |
|
213,058 |
|
205,986 |
|||
|
Total Liabilities and Equity |
$ |
2,500,340 |
$ |
2,507,025 |
$ |
2,421,389 |
|||
|
|
|
|
|
|
|
|
|||
|
Ending shares outstanding |
|
12,217 |
|
12,197 |
|
12,369 |
|||
|
Memo: Market value of HTM Securities |
$ |
90,222 |
$ |
114,046 |
$ |
56,427 |
|||
|
|
|
|
|
|
|
|
|||
|
90 days past due loans |
$ |
6,468 |
$ |
5,164 |
$ |
2,657 |
|||
|
Nonaccrual loans |
$ |
16,973 |
$ |
17,434 |
$ |
25,599 |
|||
|
Restructured loans |
$ |
1,506 |
$ |
1,546 |
$ |
284 |
|||
|
Foreclosed properties |
$ |
3,737 |
$ |
3,521 |
$ |
2,775 |
|||
|
|
|
|
|
|
|
|
|||
|
Tier 1 leverage ratio |
8.46 |
% |
8.35 |
% |
8.19 |
% |
|||
|
Tier 1 risk based ratio |
11.17 |
% |
11.06 |
% |
11.18 |
% |
|||
|
Total risk based ratio |
12.42 |
% |
12.31 |
% |
12.43 |
% |
|||
|
FTE employees |
892 |
902 |
868 |
||||||
Community Trust Bancorp, Inc.
Financial Summary (Unaudited)
September 30, 2003
Community Trust Bancorp, Inc. reported earnings for the three and nine months ended September 30, 2003 and September 30, 2002 as follows:
|
|
Three Months Ended September 30 |
Nine Months Ended September 30 |
||||||||||
|
(in thousands except per share data ) |
2003 |
2002 |
2003 |
2002 |
||||||||
|
|
|
|
|
|
|
|
|
|
||||
|
Net income |
$ |
7,281 |
$ |
7,933 |
$ |
21,338 |
$ |
20,632 |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Basic earnings per share |
$ |
0.60 |
$ |
0.64 |
$ |
1.74 |
$ |
1.65 |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Diluted earnings per share |
$ |
0.59 |
$ |
0.63 |
$ |
1.72 |
$ |
1.63 |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Average shares outstanding |
|
12,207 |
|
12,452 |
|
12,255 |
|
12,517 |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Total assets (end of period) |
$ |
2,500,340 |
$ |
2,421,389 |
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Return on average equity |
13.45 |
% |
15.32 |
% |
13.37 |
% |
13.74 |
% |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Return on average assets |
1.15 |
% |
1.30 |
% |
1.15 |
% |
1.12 |
% |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Provision for loan losses |
$ |
2,085 |
$ |
2,530 |
$ |
7,217 |
$ |
8,416 |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
Gains on sales of loans |
$ |
1,613 |
$ |
1,016 |
$ |
4,729 |
$ |
2,347 |
||||