Farmers
Capital Bank Corporation
|
||
(Exact
name of registrant as specified in its charter)
|
Kentucky
|
0-14412
|
61-1017851
|
||||
(State
or other jurisdiction
|
(Commission
|
(IRS
Employer
|
||||
of
incorporation)
|
File
Number)
|
Identification
No.)
|
P.O.
Box 309 Frankfort, KY
|
40602
|
|||
(Address
of principal executive offices)
|
(Zip
Code)
|
Not
Applicable
|
||
(Former
name or former address, if changed since last report.)
|
PART
I - FINANCIAL INFORMATION
|
3
|
3
|
|
3
|
|
4
|
|
5
|
|
6
|
|
8
|
|
9
|
|
19
|
|
36
|
|
37
|
|
PART
II - OTHER INFORMATION
|
37
|
37
|
|
37
|
|
37
|
|
38
|
September
30,
|
December
31,
|
||||||
(In thousands, except share data)
|
2006
|
2005
|
|||||
Assets
|
|||||||
Cash
and cash equivalents:
|
|||||||
Cash
and due from banks
|
$
|
107,558
|
$
|
71,496
|
|||
Interest
bearing deposits in other banks
|
2,698
|
2,565
|
|||||
Federal
funds sold and securities purchased under agreements to
resell
|
36,715
|
56,957
|
|||||
Total
cash and cash equivalents
|
146,971
|
131,018
|
|||||
Investment
securities:
|
|||||||
Available
for sale, amortized cost of $268,112 (2006) and $317,759
(2005)
|
266,085
|
315,067
|
|||||
Held
to maturity, fair value of $9,977 (2006) and $13,815
(2005)
|
9,888
|
13,610
|
|||||
Total
investment securities
|
275,973
|
328,677
|
|||||
Loans,
net of unearned income
|
1,055,431
|
962,571
|
|||||
Allowance
for loan losses
|
(10,501
|
)
|
(11,069
|
)
|
|||
Loans,
net
|
1,044,930
|
951,502
|
|||||
Premises
and equipment, net
|
32,870
|
28,832
|
|||||
Company-owned
life insurance
|
31,022
|
30,049
|
|||||
Goodwill
|
28,226
|
28,437
|
|||||
Other
intangibles, net
|
5,945
|
7,271
|
|||||
Assets
of discontinued operations
|
138,922
|
143,569
|
|||||
Other
assets
|
22,662
|
24,588
|
|||||
Total
assets
|
$
|
1,727,521
|
$
|
1,673,943
|
|||
Liabilities
|
|||||||
Deposits:
|
|||||||
Noninterest
bearing
|
$
|
212,043
|
$
|
183,248
|
|||
Interest
bearing
|
1,023,786
|
1,008,403
|
|||||
Total
deposits
|
1,235,829
|
1,191,651
|
|||||
Federal
funds purchased and securities sold under agreements to
repurchase
|
74,311
|
71,336
|
|||||
Other
short-term borrowings
|
23,788
|
780
|
|||||
Subordinated
notes payable to unconsolidated trusts
|
25,774
|
25,774
|
|||||
Long-term
debt
|
50,438
|
49,516
|
|||||
Dividends
payable
|
2,442
|
2,244
|
|||||
Accrued
purchase price-Citizens Bancorp, Inc.
|
21,846
|
||||||
Liabilities
of discontinued operations
|
140,245
|
144,409
|
|||||
Other
liabilities
|
14,274
|
12,151
|
|||||
Total
liabilities
|
1,567,101
|
1,519,707
|
|||||
Shareholders’
Equity
|
|||||||
Common
stock, par value $.125 per share
|
|||||||
9,608,000
shares authorized; 8,899,158 and 8,856,249
|
|||||||
shares
issued at September 30, 2006 and December 31, 2005,
respectively
|
1,112
|
1,107
|
|||||
Capital
surplus
|
41,055
|
39,829
|
|||||
Retained
earnings
|
161,929
|
156,796
|
|||||
Treasury
stock, at cost; 1,490,351 and 1,467,351 shares
|
|||||||
at
September 30, 2006 and December 31, 2005, respectively
|
(42,294
|
)
|
(41,579
|
)
|
|||
Accumulated
other comprehensive loss
|
(1,382
|
)
|
(1,917
|
)
|
|||
Total
shareholders’ equity
|
160,420
|
154,236
|
|||||
Total
liabilities and shareholders’ equity
|
$
|
1,727,521
|
$
|
1,673,943
|
|||
See
accompanying notes to unaudited consolidated financial
statements.
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
September
30,
|
September
30,
|
||||||||||||
(In
thousands, except per share data)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Interest
Income
|
|||||||||||||
Interest
and fees on loans
|
$
|
19,446
|
$
|
13,195
|
$
|
54,839
|
$
|
37,872
|
|||||
Interest
on investment securities:
|
|||||||||||||
Taxable
|
2,005
|
1,887
|
6,556
|
5,401
|
|||||||||
Nontaxable
|
896
|
920
|
2,758
|
2,768
|
|||||||||
Interest
on deposits in other banks
|
14
|
23
|
39
|
51
|
|||||||||
Interest
of federal funds sold and securities purchased under agreements to
resell
|
474
|
344
|
1,196
|
1,126
|
|||||||||
Total
interest income
|
22,835
|
16,369
|
65,388
|
47,218
|
|||||||||
Interest
Expense
|
|||||||||||||
Interest
on deposits
|
8,133
|
4,834
|
22,219
|
13,491
|
|||||||||
Interest
on federal funds purchased and securities sold
|
|||||||||||||
under
agreements to repurchase
|
1,212
|
640
|
3,206
|
1,814
|
|||||||||
Interest
on other borrowed funds
|
636
|
531
|
1,727
|
1,553
|
|||||||||
Interest
on subordinated notes payable to unconsolidated trusts
|
466
|
255
|
1,290
|
255
|
|||||||||
Total
interest expense
|
10,447
|
6,260
|
28,442
|
17,113
|
|||||||||
Net
interest income
|
12,388
|
10,109
|
36,946
|
30,105
|
|||||||||
Provision
for loan losses
|
253
|
348
|
172
|
367
|
|||||||||
Net
interest income after provision for loan losses
|
12,135
|
9,761
|
36,774
|
29,738
|
|||||||||
Noninterest
Income
|
|||||||||||||
Service
charges and fees on deposits
|
2,317
|
2,184
|
6,639
|
6,507
|
|||||||||
Allotment
processing fees
|
621
|
659
|
1,957
|
1,957
|
|||||||||
Other
service charges, commissions, and fees
|
568
|
503
|
1,958
|
1,675
|
|||||||||
Data
processing income
|
439
|
440
|
1,323
|
1,376
|
|||||||||
Trust
income
|
456
|
397
|
1,374
|
1,223
|
|||||||||
Investment
securities losses, net
|
(195
|
)
|
(3
|
)
|
|||||||||
Gains
on sale of mortgage loans, net
|
146
|
169
|
464
|
505
|
|||||||||
Income
from company-owned life insurance
|
320
|
314
|
1,003
|
861
|
|||||||||
Other
|
148
|
186
|
539
|
1,097
|
|||||||||
Total
noninterest income
|
5,015
|
4,852
|
15,062
|
15,198
|
|||||||||
Noninterest
Expense
|
|||||||||||||
Salaries
and employee benefits
|
6,780
|
5,743
|
20,238
|
16,741
|
|||||||||
Occupancy
expenses, net
|
866
|
670
|
2,629
|
1,976
|
|||||||||
Equipment
expenses
|
651
|
619
|
2,077
|
1,879
|
|||||||||
Data
processing and communication expenses
|
1,309
|
1,053
|
3,773
|
3,079
|
|||||||||
Bank
franchise tax
|
449
|
344
|
1,331
|
1,019
|
|||||||||
Correspondent
bank fees
|
177
|
214
|
515
|
688
|
|||||||||
Amortization
of intangibles
|
433
|
307
|
1,325
|
737
|
|||||||||
Other
|
2,236
|
1,553
|
5,954
|
5,303
|
|||||||||
Total
noninterest expense
|
12,901
|
10,503
|
37,842
|
31,422
|
|||||||||
Income
from continuing operations before income taxes
|
4,249
|
4,110
|
13,994
|
13,514
|
|||||||||
Income
tax expense from continuing operations
|
966
|
699
|
2,844
|
2,822
|
|||||||||
Income
from continuing operations
|
3,283
|
3,411
|
11,150
|
10,692
|
|||||||||
Income
from discontinued operations before income tax expense
|
713
|
656
|
1,878
|
1,544
|
|||||||||
Income
tax expense from discontinued operations
|
250
|
214
|
585
|
439
|
|||||||||
Income
from discontinued operations
|
463
|
442
|
1,293
|
1,105
|
|||||||||
Net
income
|
$
|
3,746
|
$
|
3,853
|
$
|
12,443
|
$
|
11,797
|
|||||
Net
Income Per Common Share
|
|||||||||||||
Income
from continuing operations - basic
|
$
|
.45
|
$
|
.51
|
$
|
1.51
|
$
|
1.58
|
|||||
Income
from discontinued operations - basic
|
.06
|
.06
|
.17
|
.16
|
|||||||||
Net
income per common share - basic
|
.51
|
.57
|
1.68
|
1.74
|
|||||||||
Income
from continuing operations - diluted
|
.45
|
.50
|
1.51
|
1.57
|
|||||||||
Income
from discontinued operations - diluted
|
.06
|
.06
|
.17
|
.16
|
|||||||||
Net
income per common share - diluted
|
.51
|
.56
|
1.68
|
1.73
|
|||||||||
Weighted
Average Shares Outstanding
|
|||||||||||||
Basic
|
7,393
|
6,786
|
7,385
|
6,786
|
|||||||||
Diluted
|
7,412
|
6,821
|
7,404
|
6,824
|
|||||||||
See
accompanying notes to unaudited consolidated financial
statements.
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
September
30,
|
September
30,
|
||||||||||||
(In
thousands)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Net
Income
|
$
|
3,746
|
$
|
3,853
|
$
|
12,443
|
$
|
11,797
|
|||||
Other
comprehensive income (loss):
|
|||||||||||||
Unrealized
holding gain (loss) on available for sale
|
|||||||||||||
securities
arising during the period, net of tax
|
|||||||||||||
of
$1,691, $(867), $267, and $(981), respectively
|
3,140
|
(1,610
|
)
|
495
|
(1,822
|
)
|
|||||||
Reclassification
adjustment for prior period
|
|||||||||||||
unrealized
loss recognized during current period,
|
|||||||||||||
net
of tax of $22 and $3
|
40
|
5
|
|||||||||||
Other
comprehensive (loss) income
|
3,140
|
(1,610
|
)
|
535
|
(1,817
|
)
|
|||||||
Comprehensive
Income
|
$
|
6,886
|
$
|
2,243
|
$
|
12,978
|
$
|
9,980
|
|||||
See
accompanying notes to unaudited consolidated financial
statements.
|
Nine
months ended September 30, (In thousands)
|
2006
|
2005
|
|||||
Cash
Flows from Operating Activities
|
|||||||
Net
income
|
$
|
12,443
|
$
|
11,797
|
|||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
|||||||
Depreciation
and amortization
|
4,036
|
2,916
|
|||||
Net
amortization of investment security premiums and
(discounts):
|
|||||||
Available
for sale
|
(53
|
)
|
291
|
||||
Held
to maturity
|
(18
|
)
|
(32
|
)
|
|||
Provision
for loan losses
|
172
|
367
|
|||||
Noncash
compensation expense
|
102
|
||||||
Mortgage
loans originated for sale
|
(24,419
|
)
|
(27,359
|
)
|
|||
Proceeds
from sale of mortgage loans
|
22,020
|
25,460
|
|||||
Deferred
income tax expense (benefit)
|
1,566
|
(419
|
)
|
||||
Gains
on sale of mortgage loans, net
|
(464
|
)
|
(505
|
)
|
|||
Gain
on sale of credit card portfolio
|
(700
|
)
|
|||||
Gain
on sale of premises and equipment, net
|
(93
|
)
|
(5
|
)
|
|||
Loss
on sale of available for sale investment securities, net
|
195
|
3
|
|||||
Increase
in accrued interest receivable
|
(1,377
|
)
|
(840
|
)
|
|||
Income
from company-owned life insurance
|
(973
|
)
|
(836
|
)
|
|||
Decrease
(increase) in other assets
|
2,303
|
(1,039
|
)
|
||||
Increase
in accrued interest payable
|
886
|
339
|
|||||
Increase
in other liabilities
|
968
|
1,061
|
|||||
Net
cash provided by discontinued operating activities
|
1,343
|
1,387
|
|||||
Net
cash provided by operating activities
|
18,637
|
11,886
|
|||||
Cash
Flows from Investing Activities
|
|||||||
Proceeds
from maturities and calls of investment securities:
|
|||||||
Available
for sale
|
76,093
|
111,379
|
|||||
Held
to maturity
|
3,740
|
3,040
|
|||||
Proceeds
from sale of available for sale investment securities
|
19,122
|
3,038
|
|||||
Purchase
of available for sale investment securities
|
(45,709
|
)
|
(122,774
|
)
|
|||
Loans
originated for investment, net of principal collected
|
(90,737
|
)
|
(23,802
|
)
|
|||
Payment
of prior year accrued purchase price-Citizens Bancorp,
Inc.
|
(21,846
|
)
|
|||||
Purchase
price refinements-Citizens Bancorp, Inc.
|
211
|
||||||
Additions
to mortgage servicing rights, net
|
(41
|
)
|
|||||
Purchase
of premises and equipment
|
(7,006
|
)
|
(2,487
|
)
|
|||
Proceeds
from sale of equipment
|
476
|
121
|
|||||
Net
cash provided by discontinued investing activities
|
14,225
|
21,977
|
|||||
Net
cash used in investing activities
|
(51,472
|
)
|
(9,508
|
)
|
|||
Cash
Flows from Financing Activities
|
|||||||
Net
increase in deposits
|
44,178
|
69,541
|
|||||
Net
increase in securities sold under agreements to repurchase
|
2,975
|
154
|
|||||
Proceeds
from long-term debt issued to unconsolidated trusts
|
25,774
|
||||||
Proceeds
from other long-term debt
|
11,198
|
2,000
|
|||||
Repayments
of long-term debt
|
(10,276
|
)
|
(1,049
|
)
|
|||
Net
increase (decrease) in other short-term borrowings
|
23,008
|
(999
|
)
|
||||
Dividends
paid
|
(7,112
|
)
|
(6,709
|
)
|
|||
Purchase
of common stock
|
(715
|
)
|
(526
|
)
|
|||
Shares
issued under Employee Stock Purchase Plan
|
173
|
147
|
|||||
Stock
options exercised
|
927
|
455
|
|||||
Net
cash used in discontinued financing activities
|
(5,123
|
)
|
(17,103
|
)
|
|||
Net
cash provided by financing activities
|
59,233
|
71,685
|
|||||
Net
increase in cash and cash equivalents
|
26,398
|
74,063
|
|||||
Less:
net increase in cash and cash equivalents of discontinued
operations
|
(10,445
|
)
|
(6,261
|
)
|
|||
Net
increase in cash and cash equivalents from continuing
operations
|
15,953
|
67,802
|
|||||
Cash
and cash equivalents from continuing activities at beginning of
year
|
131,018
|
77,802
|
|||||
Cash
and cash equivalents from continuing activities at end of
period
|
$
|
146,971
|
$
|
145,604
|
|||
Supplemental
Disclosures
|
|||||||
Cash
paid during the period for:
|
|||||||
Interest
|
$
|
30,484
|
$
|
19,105
|
|||
Income
taxes
|
4,050
|
2,000
|
|||||
Transfers
from loans to repossessed assets
|
1,184
|
2,599
|
|||||
Cash
dividend declared and unpaid
|
2,442
|
2,241
|
(In
thousands, except per share data)
|
Accumulated
|
||||||||||||||||||||||||
Other
|
Total
|
||||||||||||||||||||||||
Nine
months ended
|
Common
Stock
|
Capital
|
Retained
|
Treasury
Stock
|
Comprehensive
|
Shareholders’
|
|||||||||||||||||||
September
30, 2006 and 2005
|
Shares
|
Amount
|
Surplus
|
Earnings
|
Shares
|
Amount
|
Income
|
Equity
|
|||||||||||||||||
Balance
at January 1, 2006
|
8,856
|
$
|
1,107
|
$
|
39,829
|
$
|
156,796
|
1,467
|
$
|
(41,579
|
)
|
$
|
(1,917
|
)
|
$
|
154,236
|
|||||||||
Net
income
|
12,443
|
12,443
|
|||||||||||||||||||||||
Other
comprehensive income
|
535
|
535
|
|||||||||||||||||||||||
Cash
dividends declared, $.99 per share
|
(7,310
|
)
|
(7,310
|
)
|
|||||||||||||||||||||
Purchase
of common stock
|
23
|
(715
|
)
|
(715
|
)
|
||||||||||||||||||||
Stock
options exercised, including related tax benefits
|
37
|
4
|
929
|
933
|
|||||||||||||||||||||
Shares
issued pursuant to Employee Stock Purchase Plan
|
6
|
1
|
172
|
173
|
|||||||||||||||||||||
Noncash
compensation expense attributed to stock option and Employee Stock
Purchase Plan grants
|
125
|
125
|
|||||||||||||||||||||||
Balance
at September 30, 2006
|
8,899
|
$
|
1,112
|
$
|
41,055
|
$
|
161,929
|
1,490
|
$
|
(42,294
|
)
|
$
|
(1,382
|
)
|
$
|
160,420
|
|||||||||
Balance
at January 1, 2005
|
8,234
|
$
|
1,029
|
$
|
20,744
|
$
|
149,985
|
1,450
|
$
|
(41,008
|
)
|
$
|
700
|
$
|
131,450
|
||||||||||
Net
income
|
11,797
|
11,797
|
|||||||||||||||||||||||
Other
comprehensive income
|
(1,817
|
)
|
(1,817
|
)
|
|||||||||||||||||||||
Cash
dividends declared, $.99 per share
|
(6,718
|
)
|
(6,718
|
)
|
|||||||||||||||||||||
Purchase
of common stock
|
16
|
(526
|
)
|
(526
|
)
|
||||||||||||||||||||
Stock
options exercised, including related tax benefits
|
18
|
2
|
456
|
458
|
|||||||||||||||||||||
Shares
issued pursuant to Employee Stock Purchase Plan
|
6
|
1
|
146
|
147
|
|||||||||||||||||||||
Balance
at September 30, 2005
|
8,258
|
$
|
1,032
|
$
|
21,346
|
$
|
155,064
|
1,466
|
$
|
(41,534
|
)
|
$
|
(1,117
|
)
|
$
|
134,791
|
|||||||||
See
accompanying notes to unaudited consolidated financial
statements.
|
1.
|
Basis
of Presentation and Nature of
Operations
|
2.
|
Reclassifications
|
3.
|
Recently
Issued Accounting
Standards
|
4.
|
Net
Income Per Common Share
|
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||
(In
thousands, except per share data)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Net
income, basic and diluted
|
$
|
3,746
|
$
|
3,853
|
$
|
12,443
|
$
|
11,797
|
|||||
Average
shares outstanding
|
7,393
|
6,786
|
7,385
|
6,786
|
|||||||||
Effect
of dilutive stock options
|
19
|
35
|
19
|
38
|
|||||||||
Average
diluted shares outstanding
|
7,412
|
6,821
|
7,404
|
6,824
|
|||||||||
Net
income per share, basic
|
$
|
.51
|
$
|
.57
|
$
|
1.68
|
$
|
1.74
|
|||||
Net
income per share, diluted
|
.51
|
.56
|
1.68
|
1.73
|
|||||||||
Continuing
Operations
|
|||||||||||||
Income
from continuing operations, basic and diluted
|
$
|
3,283
|
$
|
3,411
|
$
|
11,150
|
$
|
10,692
|
|||||
Average
shares outstanding
|
7,393
|
6,786
|
7,385
|
6,786
|
|||||||||
Effect
of dilutive stock options
|
19
|
35
|
19
|
38
|
|||||||||
Average
diluted shares outstanding
|
7,412
|
6,821
|
7,404
|
6,824
|
|||||||||
Income
per share from continuing operations, basic
|
$
|
.45
|
$
|
.51
|
$
|
1.51
|
$
|
1.58
|
|||||
Income
per share from continuing operations, diluted
|
.45
|
.50
|
1.51
|
1.57
|
|||||||||
Discontinued
Operations
|
|||||||||||||
Income
from discontinued operations, basic and diluted
|
$
|
463
|
$
|
442
|
$
|
1,293
|
$
|
1,105
|
|||||
Average
shares outstanding
|
7,393
|
6,786
|
7,385
|
6,786
|
|||||||||
Effect
of dilutive stock options
|
19
|
35
|
19
|
38
|
|||||||||
Average
diluted shares outstanding
|
7,412
|
6,821
|
7,404
|
6,824
|
|||||||||
Income
per share from discontinued operations, basic
|
$
|
.06
|
$
|
.06
|
$
|
.17
|
$
|
.16
|
|||||
Income
per share from discontinued operations, diluted
|
.06
|
.06
|
.17
|
.16
|
(In
thousands, except per share data)
|
Three
Months Ended
September
30, 2005
|
Nine
Months Ended
September
30, 2005
|
|||||
Net
Income
|
|||||||
As
reported
|
$
|
3,853
|
$
|
11,797
|
|||
Less:
Stock-based compensation expense determined under fair value based
method
for all awards, net of related tax effects
|
(15
|
)
|
(95
|
)
|
|||
Proforma
|
$
|
3,838
|
$
|
11,702
|
|||
Net
Income Per Common Share
|
|||||||
Basic,
as reported
|
$
|
.57
|
$
|
1.74
|
|||
Basic,
proforma
|
.57
|
1.72
|
|||||
Diluted,
as reported
|
.56
|
1.73
|
|||||
Diluted,
proforma
|
.56
|
1.71
|
Income
From Continuing Operations
|
|||||||
As
reported
|
$
|
3,411
|
$
|
10,692
|
|||
Less:
Stock-based compensation expense determined under fair value based
method
for all awards, net of related tax effects
|
(14
|
)
|
(93
|
)
|
|||
Proforma
|
$
|
3,397
|
$
|
10,599
|
|||
Income
Per Common Share From Continuing Operations
|
|||||||
Basic,
as reported
|
$
|
.51
|
$
|
1.58
|
|||
Basic,
proforma
|
.51
|
1.56
|
|||||
Diluted,
as reported
|
.50
|
1.57
|
|||||
Diluted,
proforma
|
.50
|
1.55
|
Income
From Discontinued Operations
|
|||||||
As
reported
|
$
|
442
|
$
|
1,105
|
|||
Less:
Stock-based compensation expense determined under fair value based
method
for all awards, net of related tax effects
|
(1
|
)
|
(2
|
)
|
|||
Proforma
|
$
|
441
|
$
|
1,103
|
|||
Income
Per Common Share From Discontinued Operations
|
|||||||
Basic,
as reported
|
$
|
.06
|
$
|
.16
|
|||
Basic,
proforma
|
.06
|
.16
|
|||||
Diluted,
as reported
|
.06
|
.16
|
|||||
Diluted,
proforma
|
.06
|
.16
|
Three
Months Ended
September
30, 2006
|
Nine
Months Ended
September
30, 2006
|
||||||||||||
Weighted
|
Weighted
|
||||||||||||
Average
|
Average
|
||||||||||||
Shares
|
Price
|
Shares
|
Price
|
||||||||||
Outstanding
at beginning of period
|
178,304
|
$
|
27.75
|
189,447
|
$
|
27.67
|
|||||||
Granted
|
|||||||||||||
Forfeited
|
(2,000
|
)
|
34.80
|
||||||||||
Exercised
|
(27,364
|
)
|
25.65
|
(36,507
|
)
|
25.36
|
|||||||
Outstanding
at September 30
|
150,940
|
$
|
28.13
|
150,940
|
$
|
28.13
|
|||||||
Options
exercisable at September 30
|
144,083
|
$
|
28.05
|
144,083
|
$
|
28.05
|
Outstanding
|
Exercisable
|
|||||||||||||||
Weighted
Average
|
||||||||||||||||
Remaining
Contractual
|
Weighted
Average
|
Weighted
Average
|
||||||||||||||
Range
of Exercise Prices
|
Number
|
Life
(Years)
|
Exercise
Price
|
Number
|
Exercise
Price
|
|||||||||||
$ 24.50
|
81,319
|
1.00
|
$
|
24.50
|
81,319
|
$
|
24.50
|
|||||||||
$ 29.75
|
33,572
|
3.25
|
29.75
|
26,715
|
29.75
|
|||||||||||
$ 34.80
|
36,049
|
8.08
|
34.80
|
36,049
|
34.80
|
|||||||||||
Outstanding
at September 30, 2006
|
150,940
|
8.19
|
$
|
28.13
|
144,083
|
$
|
28.05
|
Three
months ended September 30,
|
Nine
months ended September 30,
|
||||||||||||
(In
thousands)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Compensation
expense recognized for stock options
|
$
|
29
|
$
|
88
|
|||||||||
Related
tax benefit recognized
|
65
|
$
|
38
|
88
|
$
|
74
|
|||||||
Weighted
average grant date fair value of options granted
|
|||||||||||||
Total
intrinsic value of options exercised
|
186
|
110
|
252
|
212
|
|||||||||
Total
fair value of options vested
|
63
|
135
|
|||||||||||
Cash
received from options exercised
|
702
|
272
|
926
|
453
|
Options
|
|||||||
2000
Grant
|
2004
Grant
|
||||||
Dividend
yield
|
3.12
|
%
|
3.80
|
%
|
|||
Expected
volatility
|
29.6
|
10.5
|
|||||
Risk-free
interest rate
|
6.71
|
2.78
|
|||||
Expected
life (in years)
|
7
|
3
|
|||||
Fair
value
|
$
|
9.25
|
$
|
1.79
|
6.
|
Employee
Stock Purchase Plan
|
ESPP
|
|||||||||||||
Three
Months Ended
September
30, 2006
|
Three
Months Ended
September
30, 2005
|
Nine
Months Ended
September
30, 2006
|
Nine
Months Ended
September
30, 2005
|
||||||||||
Dividend
yield
|
3.83
|
%
|
3.85
|
%
|
3.85
|
%
|
3.80
|
%
|
|||||
Expected
volatility
|
13.6
|
13.1
|
13.8
|
12.6
|
|||||||||
Risk-free
interest rate
|
5.08
|
3.17
|
4.64
|
2.76
|
|||||||||
Expected
life (in years)
|
.25
|
.25
|
.25
|
.25
|
|||||||||
Fair
value
|
$
|
5.69
|
$
|
5.31
|
$
|
5.51
|
$
|
6.00
|
(In
thousands)
|
September
30, 2006
|
December
31, 2005
|
|||||
Assets
|
|||||||
Cash
and cash equivalents
|
$
|
12,512
|
$
|
3,348
|
|||
Investment
securities
|
24,044
|
36,027
|
|||||
Loans,
net
|
80,301
|
80,646
|
|||||
Premises
and equipment, net
|
4,158
|
4,186
|
|||||
Other
assets
|
3,368
|
3,032
|
|||||
Total
assets
|
$
|
124,383
|
$
|
127,239
|
|||
Liabilities
|
|||||||
Deposits
|
$
|
112,391
|
$
|
115,277
|
|||
Other
borrowed funds
|
1,547
|
2,368
|
|||||
Other
liabilities
|
782
|
451
|
|||||
Total
liabilities
|
114,720
|
118,096
|
|||||
Shareholders’
equity
|
9,663
|
9,143
|
|||||
Total
liabilities and shareholders’ equity
|
$
|
124,383
|
$
|
127,239
|
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||
(In
thousands)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Interest
income
|
$
|
2,121
|
$
|
1,841
|
$
|
6,092
|
$
|
5,324
|
|||||
Interest
expense
|
862
|
695
|
2,463
|
2,057
|
|||||||||
Net
interest income
|
1,259
|
1,146
|
3,629
|
3,267
|
|||||||||
Provision
for loan losses
|
45
|
(11
|
)
|
(39
|
)
|
65
|
|||||||
Noninterest
income
|
273
|
269
|
832
|
819
|
|||||||||
Noninterest
expense
|
953
|
933
|
3,040
|
2,758
|
|||||||||
Income
tax expense
|
189
|
159
|
443
|
344
|
|||||||||
Net
income
|
$
|
345
|
$
|
334
|
$
|
1,017
|
$
|
919
|
(In
thousands)
|
September
30, 2006
|
December
31, 2005
|
|||||
Assets
|
|||||||
Cash
and cash equivalents
|
$
|
371
|
$
|
370
|
|||
Loans,
net
|
11,727
|
13,397
|
|||||
Premises
and equipment, net
|
936
|
978
|
|||||
Other
assets
|
1,504
|
1,584
|
|||||
Total
assets
|
$
|
14,538
|
$
|
16,329
|
|||
Liabilities
|
|||||||
Deposits
|
$
|
25,525
|
$
|
26,312
|
|||
Net
liabilities
|
$
|
(10,987
|
)
|
$
|
(9,983
|
)
|
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||
(In
thousands)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Interest
income
|
$
|
491
|
$
|
386
|
$
|
1,211
|
$
|
938
|
|||||
Interest
expense
|
191
|
143
|
511
|
408
|
|||||||||
Net
interest income
|
300
|
243
|
700
|
530
|
|||||||||
Provision
for loan losses
|
(19
|
)
|
(90
|
)
|
(119
|
)
|
(248
|
)
|
|||||
Noninterest
income
|
68
|
57
|
202
|
167
|
|||||||||
Noninterest
expense
|
209
|
227
|
604
|
664
|
|||||||||
Income
tax expense
|
61
|
55
|
142
|
96
|
|||||||||
Net
income
|
$
|
117
|
$
|
108
|
$
|
275
|
$
|
185
|
(In
thousands)
|
October
1, 2006
|
|||
Assets
|
||||
Cash
and equivalents
|
$
|
16,307
|
||
Investment
securities
|
13,391
|
|||
Loans,
net of unearned income and allowance for loan losses
|
119,659
|
|||
Premises
and equipment, net
|
3,424
|
|||
Goodwill
|
14,596
|
|||
Core
deposit intangible
|
4,524
|
|||
Other
assets
|
4,407
|
|||
Total
assets
|
$
|
176,308
|
||
Liabilities
|
||||
Deposits
|
$
|
139,441
|
||
Short-term
borrowings
|
2,880
|
|||
Other
liabilities
|
3,724
|
|||
Total
liabilities
|
146,045
|
|||
Net
Assets Acquired
|
$
|
30,263
|
||
Quarter
Ended September 30,
|
2006
|
2005
|
|||||||||||||||||
(In
thousands)
|
Average
Balance
|
Interest4
|
Average
Rate
|
Average
Balance
|
Interest4
|
Average
Rate
|
|||||||||||||
Earning
Assets
|
|||||||||||||||||||
Investment
securities
|
|||||||||||||||||||
Taxable
|
$
|
186,769
|
$
|
2,005
|
4.26
|
%
|
$
|
210,249
|
$
|
1,887
|
3.56
|
%
|
|||||||
Nontaxable1
|
89,434
|
1,330
|
5.90
|
90,209
|
1,395
|
6.14
|
|||||||||||||
Time
deposits with banks, federal
|
|||||||||||||||||||
funds
sold and securities purchased
|
|||||||||||||||||||
under
agreements to resell
|
65,403
|
488
|
2.96
|
58,610
|
367
|
2.48
|
|||||||||||||
Loans1,2,3
|
1,038,458
|
19,547
|
7.47
|
802,827
|
13,232
|
6.54
|
|||||||||||||
Total
earning assets
|
1,380,064
|
$
|
23,370
|
6.72
|
%
|
1,161,895
|
$
|
16,881
|
5.76
|
%
|
|||||||||
Allowance
for loan losses
|
(10,602
|
)
|
(10,136
|
)
|
|||||||||||||||
Total
earning assets, net of
|
|||||||||||||||||||
allowance
for loan losses
|
1,369,462
|
1,151,759
|
|||||||||||||||||
Nonearning
Assets
|
|||||||||||||||||||
Cash
and due from banks
|
69,615
|
68,028
|
|||||||||||||||||
Premises
and equipment, net
|
31,581
|
22,529
|
|||||||||||||||||
Other
assets
|
86,669
|
59,404
|
|||||||||||||||||
Assets
of discontinued operations
|
141,479
|
144,485
|
|||||||||||||||||
Total
assets
|
$
|
1,698,806
|
$
|
1,446,205
|
|||||||||||||||
Interest
Bearing Liabilities
|
|||||||||||||||||||
Deposits
|
|||||||||||||||||||
Interest
bearing demand
|
$
|
245,623
|
$
|
883
|
1.43
|
%
|
$
|
201,062
|
$
|
404
|
.80
|
%
|
|||||||
Savings
|
196,897
|
1,028
|
2.07
|
178,724
|
653
|
1.45
|
|||||||||||||
Time
|
576,626
|
6,222
|
4.28
|
455,765
|
3,777
|
3.29
|
|||||||||||||
Federal
funds purchased and
|
|||||||||||||||||||
securities
sold under agreements
|
|||||||||||||||||||
to
repurchase
|
101,489
|
1,212
|
4.74
|
75,485
|
640
|
3.36
|
|||||||||||||
Other
borrowed funds
|
83,901
|
1,102
|
5.21
|
70,903
|
786
|
4.40
|
|||||||||||||
Total
interest bearing liabilities
|
1,204,536
|
$
|
10,447
|
3.44
|
%
|
981,939
|
$
|
6,260
|
2.53
|
%
|
|||||||||
Noninterest
Bearing Liabilities
|
|||||||||||||||||||
Commonwealth
of Kentucky deposits
|
34,459
|
34,913
|
|||||||||||||||||
Other
demand deposits
|
146,724
|
140,611
|
|||||||||||||||||
Other
liabilities
|
13,461
|
12,183
|
|||||||||||||||||
Liabilities
of discontinued operations
|
142,979
|
142,502
|
|||||||||||||||||
Total
liabilities
|
1,542,159
|
1,312,148
|
|||||||||||||||||
Shareholders’
equity
|
156,647
|
134,057
|
|||||||||||||||||
Total
liabilities and shareholders’
|
|||||||||||||||||||
equity
|
$
|
1,698,806
|
$
|
1,446,205
|
|||||||||||||||
Net
interest income
|
12,923
|
10,621
|
|||||||||||||||||
TE
basis adjustment
|
(535
|
)
|
(512
|
)
|
|||||||||||||||
Net
interest income
|
$
|
12,388
|
$
|
10,109
|
|||||||||||||||
Net
interest spread
|
3.28
|
%
|
3.23
|
%
|
|||||||||||||||
Impact
of noninterest bearing sources
|
|||||||||||||||||||
of
funds
|
.44
|
.39
|
|||||||||||||||||
Net
interest margin
|
3.72
|
%
|
3.62
|
%
|
(In
thousands)
|
Variance
|
Variance
Attributed to
|
||||||||
Quarter
Ended September 30,
|
2006/20051,3
|
Volume
|
Rate
|
|||||||
Interest
Income
|
||||||||||
Taxable
investment securities
|
$
|
118
|
$
|
(1,024
|
)
|
$
|
1,142
|
|||
Nontaxable
investment securities2
|
(65
|
)
|
(12
|
)
|
(53
|
)
|
||||
Time
deposits with banks, federal funds sold and securities purchased
under
agreements to resell
|
121
|
45
|
76
|
|||||||
Loans2
|
6,315
|
4,254
|
2,061
|
|||||||
Total
interest income
|
6,489
|
3,263
|
3,226
|
|||||||
Interest
Expense
|
||||||||||
Interest
bearing demand deposits
|
479
|
105
|
374
|
|||||||
Savings
deposits
|
375
|
72
|
303
|
|||||||
Time
deposits
|
2,445
|
1,145
|
1,300
|
|||||||
Federal
funds purchased and securities sold under agreements to
repurchase
|
572
|
261
|
311
|
|||||||
Other
borrowed funds
|
316
|
158
|
158
|
|||||||
Total
interest expense
|
4,187
|
1,741
|
2,446
|
|||||||
Net
interest income
|
$
|
2,302
|
1,522
|
$
|
780
|
|||||
Percentage
change
|
100.0
|
%
|
66.1
|
%
|
33.9
|
%
|
Nine
Months Ended September 30,
|
2006
|
2005
|
|||||||||||||||||
(In
thousands)
|
Average
Balance
|
Interest4
|
Average
Rate
|
Average
Balance
|
Interest4
|
Average
Rate
|
|||||||||||||
Earning
Assets
|
|||||||||||||||||||
Investment
securities
|
|||||||||||||||||||
Taxable
|
$
|
210,978
|
$
|
6,556
|
4.15
|
%
|
$
|
203,290
|
$
|
5,401
|
3.55
|
%
|
|||||||
Nontaxable1
|
91,504
|
3,988
|
5.83
|
90,236
|
4,059
|
6.01
|
|||||||||||||
Time
deposits with banks, federal
|
|||||||||||||||||||
funds
sold and securities purchased
|
|||||||||||||||||||
under
agreements to resell
|
51,113
|
1,235
|
3.23
|
65,651
|
1,177
|
2.40
|
|||||||||||||
Loans1,2,3
|
1,005,865
|
55,202
|
7.34
|
791,370
|
38,111
|
6.44
|
|||||||||||||
Total
earning assets
|
1,359,460
|
$
|
66,981
|
6.59
|
%
|
1,150,547
|
$
|
48,748
|
5.66
|
%
|
|||||||||
Allowance
for loan losses
|
(10,930
|
)
|
(10,684
|
)
|
|||||||||||||||
Total
earning assets, net of
|
|||||||||||||||||||
allowance
for loan losses
|
1,348,530
|
1,139,863
|
|||||||||||||||||
Nonearning
Assets
|
|||||||||||||||||||
Cash
and due from banks
|
78,047
|
75,257
|
|||||||||||||||||
Premises
and equipment, net
|
30,376
|
22,356
|
|||||||||||||||||
Other
assets
|
86,136
|
57,393
|
|||||||||||||||||
Assets
of discontinued operations
|
141,708
|
149,949
|
|||||||||||||||||
Total
assets
|
$
|
1,684,797
|
$
|
1,444,818
|
|||||||||||||||
Interest
Bearing Liabilities
|
|||||||||||||||||||
Deposits
|
|||||||||||||||||||
Interest
bearing demand
|
$
|
259,045
|
$
|
2,728
|
1.41
|
%
|
$
|
211,778
|
$
|
1,259
|
.79
|
%
|
|||||||
Savings
|
205,253
|
3,015
|
1.96
|
177,428
|
1,745
|
1.31
|
|||||||||||||
Time
|
554,419
|
16,476
|
3.97
|
445,666
|
10,487
|
3.15
|
|||||||||||||
Federal
funds purchased and
|
|||||||||||||||||||
securities
sold under agreements
|
|||||||||||||||||||
to
repurchase
|
90,069
|
3,206
|
4.76
|
83,136
|
1,814
|
2.92
|
|||||||||||||
Other
borrowed funds
|
80,085
|
3,017
|
5.04
|
58,768
|
1,808
|
4.11
|
|||||||||||||
Total
interest bearing liabilities
|
1,188,871
|
$
|
28,442
|
3.20
|
%
|
976,776
|
$
|
17,113
|
2.34
|
%
|
|||||||||
Noninterest
Bearing Liabilities
|
|||||||||||||||||||
Commonwealth
of Kentucky deposits
|
39,004
|
38,689
|
|||||||||||||||||
Other
demand deposits
|
150,086
|
137,559
|
|||||||||||||||||
Other
liabilities
|
8,593
|
11,482
|
|||||||||||||||||
Liabilities
of discontinued operations
|
143,109
|
147,851
|
|||||||||||||||||
Total
liabilities
|
1,529,663
|
1,312,357
|
|||||||||||||||||
Shareholders’
equity
|
155,134
|
132,461
|
|||||||||||||||||
Total
liabilities and shareholders’
|
|||||||||||||||||||
equity
|
$
|
1,684,797
|
$
|
1,444,818
|
|||||||||||||||
Net
interest income
|
38,539
|
31,635
|
|||||||||||||||||
TE
basis adjustment
|
(1,593
|
)
|
(1,530
|
)
|
|||||||||||||||
Net
interest income
|
$
|
36,946
|
$
|
30,105
|
|||||||||||||||
Net
interest spread
|
3.39
|
%
|
3.32
|
%
|
|||||||||||||||
Impact
of noninterest bearing sources
|
|||||||||||||||||||
of
funds
|
.40
|
.35
|
|||||||||||||||||
Net
interest margin
|
3.79
|
%
|
3.67
|
%
|
(In
thousands)
|
Variance
|
Variance
Attributed to
|
||||||||
Nine
Months Ended September 30,
|
2006/20051,3
|
Volume
|
Rate
|
|||||||
Interest
Income
|
||||||||||
Taxable
investment securities
|
$
|
1,155
|
$
|
211
|
$
|
944
|
||||
Nontaxable
investment securities2
|
(71
|
)
|
81
|
(152
|
)
|
|||||
Time
deposits with banks, federal funds sold and securities purchased
under
agreements to resell
|
58
|
(403
|
)
|
461
|
||||||
Loans2
|
17,091
|
11,277
|
5,814
|
|||||||
Total
interest income
|
18,233
|
11,166
|
7,067
|
|||||||
Interest
Expense
|
||||||||||
Interest
bearing demand deposits
|
1,469
|
325
|
1,144
|
|||||||
Savings
deposits
|
1,270
|
305
|
965
|
|||||||
Time
deposits
|
5,989
|
2,898
|
3,091
|
|||||||
Federal
funds purchased and securities sold under agreements to
repurchase
|
1,392
|
162
|
1,230
|
|||||||
Other
borrowed funds
|
1,209
|
744
|
465
|
|||||||
Total
interest expense
|
11,329
|
4,434
|
6,895
|
|||||||
Net
interest income
|
$
|
6,904
|
$
|
6,732
|
$
|
172
|
||||
Percentage
change
|
100.0
|
%
|
97.5
|
%
|
2.5
|
%
|
September
30, 2006
|
December
31, 2005
|
||||||||||||
(Dollars
in thousands)
|
Amount
|
%
|
Amount
|
%
|
|||||||||
Commercial,
financial,
|
|||||||||||||
and
agriculture
|
$
|
185,290
|
17.5
|
%
|
$
|
173,797
|
18.1
|
%
|
|||||
Real
estate - construction
|
130,425
|
12.4
|
88,693
|
9.2
|
|||||||||
Real
estate mortgage - residential
|
340,823
|
32.3
|
331,508
|
34.4
|
|||||||||
Real
estate mortgage farmland and
|
|||||||||||||
other
commercial enterprises
|
310,929
|
29.5
|
274,411
|
28.5
|
|||||||||
Installment
|
54,345
|
5.1
|
56,169
|
5.8
|
|||||||||
Lease
financing
|
33,619
|
3.2
|
37,993
|
4.0
|
|||||||||
Total
|
$
|
1,055,431
|
100.0
|
%
|
$
|
962,571
|
100.0
|
%
|
Farmers
Capital
|
Regulatory
|
||||||
Bank
Corporation
|
Minimum
|
||||||
Tier
1 risk based
|
12.46
|
%
|
4.00
|
%
|
|||
Total
risk based
|
13.31
|
%
|
8.00
|
%
|
|||
Leverage
|
9.17
|
%
|
4.00
|
%
|
List
of Exhibits
|
||
3i.
|
Amended
and Restated Articles of Incorporation of Farmers Capital Bank Corporation
(incorporated by reference to Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 2006).
|
|
3ii.
|
Amended
and Restated By-Laws of Farmers Capital Bank Corporation (incorporated
by
reference to Annual Report of Form 10-K for the fiscal year ended
December
31, 1997.
|
|
3iia
|
Amendments
to By-Laws of Farmers Capital Bank Corporation (incorporated by reference
to Quarterly Report of Form 10-Q for the quarterly period ended March
31,
2003).
|
|
31.1
|
||
31.2
|
||
32
|
||
Date:
|
November 7, 2006 | /s/ G. Anthony Busseni | |
G.
Anthony Busseni,
|
|||
President
and CEO
|
|||
(Principal
Executive Officer)
|
|||
Date:
|
11-7-06 | /s/ Doug Carpenter | |
C.
Douglas Carpenter,
|
|||
Senior
Vice President, Secretary, and CFO
|
|||
(Principal
Financial and Accounting Officer)
|