x
|
ANNUAL REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
o
|
TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Farmers
Capital Bank Corporation
|
||
(Exact
name of registrant as specified in its charter)
|
Kentucky
|
61-1017851
|
|
(State
or other jurisdiction of
incorporation
or organization)
|
(I.R.S.
Employer
Identification
Number)
|
P.O.
Box 309, 202 West Main St.
|
||
Frankfort,
Kentucky
|
40601
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Common
Stock - $.125 per share Par Value
|
The
NASDAQ Global Select Market
|
|
(Title
of each class)
|
(Name
of each exchange on which
registered)
|
None
|
||
(Title
of Class)
|
Yes
o
|
No
x
|
Yes
o
|
No
x
|
Yes
x
|
No
o
|
Large
accelerated filer o
|
Accelerated
filer x
|
Non-accelerated
filer o
|
Yes
o
|
No
x
|
Page
|
|||
Part
I
|
|||
Item
1.
|
4
|
||
Item
1A.
|
12
|
||
Item
1B.
|
13
|
||
Item
2.
|
14
|
||
Item
3.
|
15
|
||
Item
4.
|
15
|
||
Part
II
|
|||
Item
5.
|
15
|
||
Item
6.
|
18
|
||
Item
7.
|
19
|
||
Item
7A.
|
41
|
||
Item
8.
|
42
|
||
Item
9.
|
77
|
||
Item
9A.
|
77
|
||
Item
9B.
|
78
|
||
Part
III
|
|||
Item
10.
|
78
|
||
Item
11.
|
79
|
||
Item
12.
|
79
|
||
Item
13.
|
79
|
||
Item
14.
|
79
|
||
Part
IV
|
|||
Item
15.
|
79
|
||
81
|
|||
82
|
Tier
|
Entity
|
|||
1
|
Farmers
Capital Bank Corporation, Frankfort KY
|
|||
2
|
United
Bank & Trust Co., Versailles KY 100%
|
|||
3
|
EV
Properties, Inc., Versailles KY 100%
|
|||
2
|
The
Lawrenceburg Bank and Trust Company, Harrodsburg KY
100%
|
|||
2
|
Farmers
Bank & Capital Trust Co., Frankfort KY 100%
|
|||
3
|
Farmers
Bank Realty Co., Frankfort KY 100%
|
|||
3
|
Leasing
One Corporation, Frankfort KY 100%
|
|||
3
|
EG
Properties, Inc., Frankfort KY 100%
|
|||
3
|
Austin
Park Apartments, LTD, Frankfort KY 99%
|
|||
3
|
Frankfort
Apartments II, LTD, Frankfort KY 99.9%
|
|||
3
|
Farmers
Capital Insurance Corporation, Frankfort KY 100%
|
|||
4
|
Farmers
Fidelity Insurance Agency, LLP, Lexington KY 50%
|
|||
2
|
Citizens
Bank of Jessamine County, Nicholasville KY 100%
|
|||
2
|
First
Citizens Bank, Elizabethtown KY 100%
|
|||
2
|
Farmers
Bank and Trust Company, Georgetown KY 100%
|
|||
2
|
Citizens
Bank of Northern Kentucky, Inc., Newport, KY 100%
|
|||
2
|
FCB
Services, Inc., Frankfort KY 100%
|
|||
2
|
Kentucky
General Holdings, LLC, Frankfort, KY 100%
|
|||
3
|
KHL
Holdings, LLC, Frankfort KY 45% (equity), 50% (voting)
|
|||
4
|
Kentucky
Home Life Insurance Company, Frankfort KY 100%
|
|||
2
|
FFKT
Insurance Services, Inc., Frankfort, KY 100%
|
|||
2
|
Farmers
Capital Bank Trust I, Frankfort, KY 100%
|
|||
2
|
Farmers
Capital Bank Trust II, Frankfort, KY 100%
|
|||
2
|
Farmers
Capital Bank Trust III, Frankfort, KY 100%
|
|||
2
|
Kentucky
General Life Insurance Company, Frankfort KY
(Inactive)
|
|
·
|
limit
the interest and other charges collected or contracted for by all of the
Company’s subsidiary banks;
|
|
·
|
govern
disclosures of credit terms to consumer
borrowers;
|
|
·
|
require
financial institutions to provide information to enable the public and
public officials to determine whether a financial institution is
fulfilling its obligation to help meet the housing needs of the community
it serves;
|
|
·
|
prohibit
discrimination on the basis of race, creed, or other prohibited factors in
extending credit;
|
|
·
|
require
all of the Company’s subsidiary banks to safeguard the personal non-public
information of its customers, provide annual notices to consumers
regarding the usage and sharing of such information and limit disclosure
of such information to third parties except under specific circumstances;
and
|
|
·
|
govern
the manner in which consumer debts may be collected by collection
agencies.
|
|
·
|
require
disclosure of the interest rate and other terms of consumer deposit
accounts;
|
|
·
|
impose
a duty to maintain the confidentiality of consumer financial records and
prescribe procedures for complying with administrative subpoenas of
financial records; and
|
·
|
govern automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services. |
|
·
|
credit
risks of a particular borrower;
|
|
·
|
changes
in economic and industry
conditions;
|
|
·
|
the
duration of the loan; and
|
|
·
|
in
the case of a collateralized loan, uncertainties as to the future value of
the collateral.
|
|
·
|
a
regular review of the quality, mix and size of the overall loan
portfolio;
|
|
·
|
historical
loan loss experience;
|
|
·
|
evaluation
of non-performing loans;
|
|
·
|
assessment
of economic conditions and their effects on the bank’s existing portfolio;
and
|
|
·
|
the
amount and quality of collateral, including guarantees, securing
loans.
|
Banking
Offices
|
125
W. Main Street, Frankfort, KY
|
555
Versailles Road, Frankfort, KY
|
1401
Louisville Road, Frankfort, KY
|
154
Versailles Road, Frankfort, KY
|
1301
US 127 South, Frankfort, KY (leased)
|
200
E. Main Street, Georgetown, KY
|
100
Farmers Bank Drive, Georgetown, KY (leased)
|
100
N. Bradford Lane, Georgetown, KY
|
3285
Main Street, Stamping Ground, KY
|
333
W. Vine Street, Suite 102, Lexington, KY (leased)
|
3098
Harrodsburg Road, Lexington, KY (leased)
|
100
United Bank Drive, Versailles, KY
|
Locust
& Green Streets, Versailles, KY
|
206
N. Gratz, Midway, KY
|
128
S. Main Street, Lawrenceburg, KY
|
West
Park Shopping Center, Lawrenceburg, KY
|
838
N. College Street, Harrodsburg, KY
|
1035
Ben Ali Drive, Danville, KY (leased)
|
425
W. Dixie Avenue, Elizabethtown, KY
|
3030
Ring Road, Elizabethtown, KY
|
111
Towne Drive (Kroger Store) Elizabethtown, KY (leased)
|
232
Redmar Plaza, Radcliff, KY (leased)
|
4810
N. Preston Highway, Shepherdsville, KY
|
157
Eastbrooke Court, Mt. Washington, KY
|
103
Churchill Drive, Newport, KY
|
7300
Alexandria Pike, Alexandria, KY
|
164
Fairfield Avenue, Bellevue, KY
|
8730
US Highway 42, Florence, KY
|
34
N. Ft. Thomas Avenue, Ft. Thomas, KY (leased)
|
2911
Alexandria Pike, Highland Heights, KY (leased)
|
2006
Patriot Way, Independence, KY
|
2774
Town Center Blvd., Crestview Hills, KY (leased)
|
201
N. Main Street, Nicholasville, KY
|
995
S. Main Street (Kroger Store), Nicholasville, KY
(leased)
|
986
N. Main Street, Nicholasville, KY
|
106
S. Lexington Avenue, Wilmore, KY
|
2002
|
2003
|
2004
|
2005
|
2006
|
2007
|
|||||||||||||||||||
Farmers
Capital Bank Corporation
|
$ | 100.00 | $ | 106.31 | $ | 133.74 | $ | 103.81 | $ | 122.13 | $ | 101.02 | ||||||||||||
NASDAQ
Composite
|
100.00 | 149.75 | 164.64 | 168.60 | 187.83 | 205.22 | ||||||||||||||||||
Southeastern
Banks Under 1 Billion Market Capitalization
|
100.00 | 138.82 | 162.94 | 164.43 | 192.13 | 142.34 |
NASDAQ
Market Makers
|
|
J.J.B.
Hilliard, W.L. Lyons, Inc.
|
Morgan,
Keegan and Company
|
(502)
588-8400
|
(800)
260-0280
|
(800)
444-1854
|
UBS
Securities, LLC
|
Howe
Barnes Investments, Inc.
|
(859)
269-6900
|
(800)
621-2364
|
(502)
589-4000
|
Selected
Financial Highlights
|
||||||||||||||||||||
December
31,
(In
thousands, except per share data)
|
2007
|
2006 | 3 |
2005
|
2004
|
2003
|
||||||||||||||
Results
of Operations
|
||||||||||||||||||||
Interest
income
|
$ | 114,257 | $ | 92,340 | $ | 65,651 | $ | 55,296 | $ | 52,218 | ||||||||||
Interest
expense
|
56,039 | 41,432 | 24,409 | 16,729 | 17,565 | |||||||||||||||
Net
interest income
|
58,218 | 50,908 | 41,242 | 38,567 | 34,653 | |||||||||||||||
Provision
for loan losses
|
3,638 | 965 | 622 | 856 | 1,895 | |||||||||||||||
Noninterest
income
|
24,157 | 20,459 | 19,867 | 17,164 | 17,179 | |||||||||||||||
Noninterest
expense
|
58,823 | 53,377 | 42,164 | 38,812 | 34,555 | |||||||||||||||
Income
from continuing operations
|
15,627 | 13,665 | 14,532 | 13,064 | 12,267 | |||||||||||||||
Income
from discontinued operations1
|
7,707 | 1,240 | 328 | 696 | ||||||||||||||||
Net
income
|
15,627 | 21,372 | 15,772 | 13,392 | 12,963 | |||||||||||||||
Per
Share Data
|
||||||||||||||||||||
Basic:
|
||||||||||||||||||||
Income
from continuing operations
|
$ | 2.03 | $ | 1.82 | $ | 2.13 | $ | 1.94 | $ | 1.82 | ||||||||||
Net
income
|
2.03 | 2.85 | 2.31 | 1.99 | 1.93 | |||||||||||||||
Diluted:
|
||||||||||||||||||||
Income
from continuing operations
|
2.03 | 1.82 | 2.12 | 1.93 | 1.81 | |||||||||||||||
Net
income
|
2.03 | 2.84 | 2.30 | 1.98 | 1.92 | |||||||||||||||
Cash
dividends declared
|
1.32 | 1.43 | 1.32 | 1.32 | 1.29 | |||||||||||||||
Book
value
|
22.82 | 22.43 | 20.87 | 19.38 | 18.83 | |||||||||||||||
Selected
Ratios
|
||||||||||||||||||||
Percentage
of income from continuing operations to:
|
||||||||||||||||||||
Average
shareholders’ equity (ROE)
|
8.88 | % | 8.49 | % | 10.81 | % | 10.21 | % | 9.83 | % | ||||||||||
Average
total assets2
(ROA)
|
.83 | .85 | 1.10 | 1.07 | 1.07 | |||||||||||||||
Percentage
of dividends declared to income from continuing operations
|
64.52 | 78.89 | 61.67 | 68.10 | 70.70 | |||||||||||||||
Percentage
of average shareholders’ equity to average total assets2
|
9.33 | 10.04 | 10.19 | 10.45 | 10.88 | |||||||||||||||
Total
shareholders’ equity
|
$ | 168,491 | $ | 177,063 | $ | 154,236 | $ | 131,450 | $ | 126,471 | ||||||||||
Total
assets
|
2,068,247 | 1,825,108 | 1,673,943 | 1,399,896 | 1,324,341 | |||||||||||||||
Long-term
debt
|
316,309 | 87,992 | 75,291 | 51,265 | 53,932 | |||||||||||||||
Weighted
Average Shares Outstanding
|
||||||||||||||||||||
Basic
|
7,706 | 7,511 | 6,831 | 6,737 | 6,727 | |||||||||||||||
Diluted
|
7,706 | 7,526 | 6,864 | 6,780 | 6,770 |
|
·
|
During
2007, the general trend of the interest rate environment has been sharply
lower, particularly with short-term rates. In the final half of 2007, the
Federal Reserve Board (“Fed”) lowered the short-term federal funds rate by
a total of 100 basis points and at year-end 2007 the rate was 4.25%. The
prime interest rate, which significantly impacts the Company’s loan
portfolio and certain deposits, declined in a similar
manner. Yields on U.S. Treasury obligations, which impact the
value of bond investments and certain funding sources, have declined
throughout all maturity periods in the year-end comparison. On shorter
term obligations, the yield on the one-year Treasury bill is down 166
basis points at year-end 2007 compared to a year earlier. For intermediate
term maturities, the three, five, and ten year notes have fallen 167, 125,
and 67 basis points in yield, respectively. The yield on the 20-year bond
is down 41 basis points and the 30-year bond is down 36 basis points. The
effect of lower market rates did have a negative impact on the Company’s
net interest spread and margin during 2007; however, the Company has yet
to absorb the full impact due to the timing of market interest rate
changes and the repricing characteristics of the Company’s interest
sensitive assets and liabilities. The Company expects further margin
compression during 2008.
|
|
·
|
The
Company had a sharp increase in the provision for loan losses in the
fourth quarter of 2007, which is reflective of higher levels of
nonperforming loans, primarily nonaccrual loans. Nonperforming loans were
$21.1 million at December 31, 2007 compared to $12.4 million and $4.3
million at September 30, 2007 and December 31, 2006, respectively. A
significant amount of the increase in nonperforming loans during the
fourth quarter of 2007 compared to the third quarter of 2007 and the prior
year-end is limited to a relatively small number of larger-balance
credits. Although the Company believes that loan demand and credit quality
overall remains healthy, the real estate development segment of the
Company’s portfolio began to show deteriorating conditions, including a
slowdown in demand, in certain parts of its banking market in the fourth
quarter of 2007.
|
|
·
|
During
the fourth quarter of 2007, the Company entered into a balance sheet
leverage transaction to enhance earnings. The Company borrowed
approximately $200 million in multiple fixed rate repurchase agreements
and used
the proceeds to purchase a like amount of fixed rate Government National
Mortgage Association (“GNMA”) bonds. The leverage transaction added $423
thousand to net interest income during the fourth quarter of
2007.
|
|
·
|
During
the third quarter of 2007 the Company purchased 559 thousand shares of its
outstanding common stock at a price of $17.9 million or $32.00 per share
through a process commonly known as a modified “Dutch
Auction”. The number of shares purchased represented 7.1% of
the shares issued and outstanding on the date of
purchase.
|
|
·
|
In
January 2007, First Citizens completed its transaction to acquire the
Military Allotment operation of PNC Bank, National Association in a cash
transaction. First Citizens acquired intangible assets in the form of a
customer list and goodwill. It also recorded a core deposit intangible in
connection with receiving approximately $10.8 million in deposits from PNC
in the transaction. First Citizens merged the acquired Military Allotment
operation into its existing allotment operations, which specializes in the
processing of federal benefit payments and military allotments. The
purchase added $3.3 million in noninterest income for the year and $887
thousand in amortization expense related to the intangible assets
acquired.
|
|
·
|
During
the fourth quarter of 2006 the Company sold KBC and the Bath County
branches of its Farmers Georgetown bank subsidiary. The Company recorded a
pretax gain on these sales of $9.8 million. The impact from these sales,
which has been classified as discontinued operations, was a decrease in
net loans and deposits of $88.6 million and $146 million,
respectively.
|
Years
Ended December 31,
|
2007
|
2006
|
2005
|
|||||||||||||||||||||||||||||||||
Average
|
Average
|
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||||||||||||
(In
thousands)
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
|||||||||||||||||||||||||||
Earning
Assets
|
||||||||||||||||||||||||||||||||||||
Investment
securities
|
||||||||||||||||||||||||||||||||||||
Taxable
|
$ | 253,423 | $ | 12,627 | 4.98 | % | $ | 212,357 | $ | 9,025 | 4.25 | % | $ | 208,967 | $ | 7,483 | 3.58 | % | ||||||||||||||||||
Nontaxable1
|
88,501 | 4,794 | 5.42 | 91,413 | 5,278 | 5.77 | 90,758 | 5,419 | 5.97 | |||||||||||||||||||||||||||
Time
deposits with banks, federal funds sold and securities purchased under
agreements to resell
|
70,062 | 3,333 | 4.76 | 62,378 | 2,355 | 3.78 | 68,212 | 1,811 | 2.65 | |||||||||||||||||||||||||||
Loans
1,2,3
|
1,250,423 | 95,825 | 7.66 | 1,051,002 | 77,836 | 7.41 | 805,014 | 52,990 | 6.58 | |||||||||||||||||||||||||||
Total
earning assets
|
1,662,409 | $ | 116,579 | 7.01 | % | 1,417,150 | $ | 94,494 | 6.67 | % | 1,172,951 | $ | 67,703 | 5.77 | % | |||||||||||||||||||||
Allowance
for loan losses
|
(11,486 | ) | (11,094 | ) | (10,528 | ) | ||||||||||||||||||||||||||||||
Total
earning assets, net of allowance for
loan losses
|
1,650,923 | 1,406,056 | 1,162,423 | |||||||||||||||||||||||||||||||||
Nonearning
Assets
|
||||||||||||||||||||||||||||||||||||
Cash
and due from banks
|
78,810 | 77,509 | 75,302 | |||||||||||||||||||||||||||||||||
Premises
and equipment, net
|
38,860 | 32,029 | 22,759 | |||||||||||||||||||||||||||||||||
Other
assets
|
117,459 | 88,044 | 58,566 | |||||||||||||||||||||||||||||||||
Assets
of discontinued operations
|
129,827 | 148,474 | ||||||||||||||||||||||||||||||||||
Total
assets
|
$ | 1,886,052 | $ | 1,733,465 | $ | 1,467,524 | ||||||||||||||||||||||||||||||
Interest
Bearing Liabilities
|
||||||||||||||||||||||||||||||||||||
Deposits
|
||||||||||||||||||||||||||||||||||||
Interest
bearing demand
|
$ | 258,992 | $ | 3,684 | 1.42 | % | $ | 260,417 | $ | 3,774 | 1.45 | % | $ | 214,548 | $ | 1,878 | .88 | % | ||||||||||||||||||
Savings
|
244,299 | 5,299 | 2.17 | 212,948 | 4,437 | 2.08 | 182,337 | 2,575 | 1.41 | |||||||||||||||||||||||||||
Time
|
748,939 | 36,174 | 4.83 | 587,047 | 24,343 | 4.15 | 453,419 | 14,677 | 3.24 | |||||||||||||||||||||||||||
Federal
funds purchased and other short-term borrowings
|
97,192 | 4,504 | 4.63 | 97,489 | 4,676 | 4.80 | 82,717 | 2,592 | 3.13 | |||||||||||||||||||||||||||
Securities
sold under agreements to repurchase and other long-term
borrowings
|
127,277 | 6,378 | 5.01 | 79,472 | 4,202 | 5.29 | 62,628 | 2,687 | 4.29 | |||||||||||||||||||||||||||
Total
interest bearing liabilities
|
1,476,699 | $ | 56,039 | 3.79 | % | 1,237,373 | $ | 41,432 | 3.35 | % | 995,649 | $ | 24,409 | 2.45 | % | |||||||||||||||||||||
Noninterest
Bearing Liabilities
|
||||||||||||||||||||||||||||||||||||
Commonwealth
of Kentucky deposits
|
37,119 | 38,627 | 37,978 | |||||||||||||||||||||||||||||||||
Other
demand deposits
|
177,304 | 157,355 | 141,219 | |||||||||||||||||||||||||||||||||
Other
liabilities
|
19,009 | 7,705 | 11,292 | |||||||||||||||||||||||||||||||||
Liabilities
of discontinued operations
|
131,437 | 147,010 | ||||||||||||||||||||||||||||||||||
Total
liabilities
|
1,710,131 | 1,572,497 | 1,333,148 | |||||||||||||||||||||||||||||||||
Shareholders’
equity
|
175,921 | 160,968 | 134,376 | |||||||||||||||||||||||||||||||||
Total
liabilities and shareholders’ equity
|
$ | 1,886,052 | $ | 1,733,465 | $ | 1,467,524 | ||||||||||||||||||||||||||||||
Net
interest income
|
60,540 | 53,062 | 43,294 | |||||||||||||||||||||||||||||||||
TE
basis adjustment
|
(2,322 | ) | (2,154 | ) | (2,052 | ) | ||||||||||||||||||||||||||||||
Net
interest income
|
$ | 58,218 | $ | 50,908 | $ | 41,242 | ||||||||||||||||||||||||||||||
Net
interest spread
|
3.22 | % | 3.32 | % | 3.32 | % | ||||||||||||||||||||||||||||||
Effect
of noninterest bearing sources of funds
|
.42 | .43 | .37 | |||||||||||||||||||||||||||||||||
Net
interest margin
|
3.64 | % | 3.75 | % | 3.69 | % |
1
|
Income
and yield stated at a fully tax equivalent basis using the marginal
corporate Federal tax rate of 35%.
|
2
|
Loan
balances include principal balances on nonaccrual
loans.
|
3
|
Loan
fees included in interest income amounted to $2.7 million, $2.0
million, and $2.1 million for 2007, 2006, and 2005,
respectively.
|
|
The
following table is an analysis of the change in net interest
income.
|
Variance
|
Variance
Attributed to
|
Variance
|
Variance
Attributed to
|
|||||||||||||||||||||
(In
thousands)
|
2007/2006 | 1 |
Volume
|
Rate
|
2006/2005 | 1 |
Volume
|
Rate
|
||||||||||||||||
Interest
Income
|
||||||||||||||||||||||||
Taxable
investment securities
|
$ | 3,602 | $ | 1,908 | $ | 1,694 | $ | 1,542 | $ | 123 | $ | 1,419 | ||||||||||||
Nontaxable
investment securities2
|
(484 | ) | (167 | ) | (317 | ) | (141 | ) | 39 | (180 | ) | |||||||||||||
Time
deposits with banks, federal funds sold and securities purchased under
agreements to resell
|
978 | 315 | 663 | 544 | (167 | ) | 711 | |||||||||||||||||
Loans2
|
17,989 | 15,273 | 2,716 | 24,846 | 17,586 | 7,260 | ||||||||||||||||||
Total
interest income
|
22,085 | 17,329 | 4,756 | 26,791 | 17,581 | 9,210 | ||||||||||||||||||
Interest
Expense
|
||||||||||||||||||||||||
Interest
bearing demand deposits
|
(90 | ) | (19 | ) | (71 | ) | 1,896 | 471 | 1,425 | |||||||||||||||
Savings
deposits
|
862 | 666 | 196 | 1,862 | 486 | 1,376 | ||||||||||||||||||
Time
deposits
|
11,831 | 7,422 | 4,409 | 9,666 | 4,950 | 4,716 | ||||||||||||||||||
Federal
funds purchased and other short-term borrowings
|
(172 | ) | (13 | ) | (159 | ) | 2,084 | 522 | 1,562 | |||||||||||||||
Securities
sold under agreements to repurchase and other long-term
borrowings
|
2,176 | 2,410 | (234 | ) | 1,515 | 812 | 703 | |||||||||||||||||
Total
interest expense
|
14,607 | 10,466 | 4,141 | 17,023 | 7,241 | 9,782 | ||||||||||||||||||
Net
interest income
|
$ | 7,478 | $ | 6,863 | $ | 615 | $ | 9,768 | $ | 10,340 | $ | (572 | ) | |||||||||||
Percentage
change
|
100.0 | % | 91.8 | % | 8.2 | % | 100.0 | % | 105.9 | % | (5.9 | )% |
1
|
The
changes which are not solely due to rate or volume are allocated on a
percentage basis using the absolute values of rate and volume variances as
a basis for allocation.
|
2
|
Income
stated at fully tax equivalent basis using the marginal corporate Federal
tax rate of 35%.
|
(In
thousands)
December
31,
|
2007
|
%
|
2006
|
%
|
2005
|
%
|
2004
|
%
|
2003
|
%
|
|||||||||||||||||||||||||
Commercial,
financial, and agricultural
|
$ | 154,015 | 11.9 | % | $ | 197,613 | 16.5 | % | $ | 173,797 | 18.1 | % | $ | 119,004 | 15.3 | % | $ | 99,291 | 14.7 | % | |||||||||||||||
Real
estate – construction
|
254,788 | 19.7 | 176,779 | 14.7 | 88,693 | 9.2 | 62,111 | 8.0 | 44,622 | 6.6 | |||||||||||||||||||||||||
Real
estate mortgage – residential
|
405,992 | 31.5 | 381,081 | 31.8 | 331,508 | 34.4 | 280,869 | 36.2 | 245,737 | 36.4 | |||||||||||||||||||||||||
Real
estate mortgage – farmland and other commercial
enterprises
|
394,900 | 30.6 | 351,793 | 29.4 | 274,411 | 28.5 | 210,701 | 27.2 | 192,541 | 28.5 | |||||||||||||||||||||||||
Installment
|
52,028 | 4.0 | 57,116 | 4.8 | 56,169 | 5.8 | 63,684 | 8.2 | 58,274 | 8.6 | |||||||||||||||||||||||||
Lease
financing
|
30,262 | 2.3 | 33,454 | 2.8 | 37,993 | 4.0 | 39,348 | 5.1 | 35,372 | 5.2 | |||||||||||||||||||||||||
Total
|
$ | 1,291,985 | 100.0 | % | $ | 1,197,836 | 100.0 | % | $ | 962,571 | 100.0 | % | $ | 775,717 | 100.0 | % | $ | 675,837 | 100.0 | % |
Within
|
After
One But
|
After
|
||||||||||||||
(In
thousands)
|
One
Year
|
Within
Five Years
|
Five
Years
|
Total
|
||||||||||||
Commercial,
financial, and agricultural
|
$ | 82,450 | $ | 30,643 | $ | 40,922 | $ | 154,015 | ||||||||
Real
estate – construction
|
181,804 | 65,190 | 7,794 | 254,788 | ||||||||||||
Total
|
$ | 264,254 | $ | 95,833 | $ | 48,716 | $ | 408,803 |
Fixed
|
Variable
|
|||||||
(In
thousands)
|
Rate
|
Rate
|
||||||
Due
after one but within five years
|
$ | 48,913 | $ | 45,998 | ||||
Due
after five years
|
17,208 | 28,948 | ||||||
Total
|
$ | 66,121 | $ | 74,946 |
Years
Ended December 31, (In thousands)
|
2007
|
2006
|
2005
|
2004
|
2003
|
|||||||||||||||
Balance
of allowance for loan losses at beginning of year
|
$ | 11,999 | $ | 11,069 | $ | 11,043 | $ | 10,088 | $ | 9,931 | ||||||||||
Acquisition
of Citizens Jessamine
|
1,066 | |||||||||||||||||||
Acquisition
of Citizens Northern
|
1,410 | |||||||||||||||||||
Acquisition
of Citizens Georgetown
|
2,005 | |||||||||||||||||||
Loans
charged off:
|
||||||||||||||||||||
Commercial,
financial, and agricultural
|
520 | 486 | 301 | 678 | 171 | |||||||||||||||
Real
estate
|
626 | 200 | 288 | 462 | 650 | |||||||||||||||
Installment
loans to individuals
|
956 | 839 | 1,254 | 1,115 | 898 | |||||||||||||||
Lease
financing
|
52 | 254 | 602 | 113 | 385 | |||||||||||||||
Total
loans charged off
|
2,154 | 1,779 | 2,445 | 2,368 | 2,104 | |||||||||||||||
Recoveries
of loans previously charged off:
|
||||||||||||||||||||
Commercial,
financial, and agricultural
|
126 | 262 | 69 | 119 | 73 | |||||||||||||||
Real
estate
|
241 | 81 | 66 | 89 | 47 | |||||||||||||||
Installment
loans to individuals
|
319 | 294 | 260 | 229 | 227 | |||||||||||||||
Lease
financing
|
47 | 41 | 44 | 25 | 19 | |||||||||||||||
Total
recoveries
|
733 | 678 | 439 | 462 | 366 | |||||||||||||||
Net
loans charged off
|
1,421 | 1,101 | 2,006 | 1,906 | 1,738 | |||||||||||||||
Additions
to allowance charged to expense
|
3,638 | 965 | 622 | 856 | 1,895 | |||||||||||||||
Balance
at end of year
|
$ | 14,216 | $ | 11,999 | $ | 11,069 | $ | 11,043 | $ | 10,088 | ||||||||||
Average
loans net of unearned income
|
$ | 1,250,423 | $ | 1,051,002 | $ | 805,014 | $ | 735,697 | $ | 663,442 | ||||||||||
Ratio
of net charge-offs during year to average loans, net of
unearned income
|
.11 | % | .10 | % | .25 | % | .26 | % | .26 | % |
December
31, (In thousands)
|
2007
|
2006
|
2005
|
2004
|
2003
|
|||||||||||||||
Commercial,
financial, and agricultural
|
$ | 2,505 | $ | 2,223 | $ | 2,840 | $ | 2,108 | $ | 2,068 | ||||||||||
Real
estate
|
9,201 | 6,497 | 5,849 | 6,206 | 5,560 | |||||||||||||||
Installment
loans to individuals
|
1,979 | 2,316 | 1,601 | 1,634 | 1,478 | |||||||||||||||
Lease
financing
|
531 | 963 | 779 | 1,095 | 982 | |||||||||||||||
Total
|
$ | 14,216 | $ | 11,999 | $ | 11,069 | $ | 11,043 | $ | 10,088 |
2007
|
2006
|
2005
|
2004
|
2003
|
||||||||||||||||
Loans
accounted for on nonaccrual basis
|
$ | 18,073 | $ | 1,462 | $ | 2,269 | $ | 4,990 | $ | 4,823 | ||||||||||
Loans
past due 90 days or more and still accruing
|
2,977 | 2,856 | 2,383 | 2,831 | 3,235 | |||||||||||||||
Total
nonperforming loans
|
21,050 | 4,318 | 4,652 | 7,821 | 8,058 | |||||||||||||||
Other
real estate owned
|
6,044 | 5,031 | 8,786 | 3,719 | 1,662 | |||||||||||||||
Other
foreclosed assets
|
66 | 54 | 21 | 32 | 218 | |||||||||||||||
Total
nonperforming assets
|
$ | 27,160 | $ | 9,403 | $ | 13,459 | $ | 11,572 | $ | 9,938 |
December
31,
|
2007
|
2006
|
2005
|
|||||||||||||||||||||
(In
thousands)
|
Available
for
Sale
|
Held
to
Maturity
|
Available
for
Sale
|
Held
to
Maturity
|
Available
for
Sale
|
Held
to
Maturity
|
||||||||||||||||||
Obligations
of U.S. government-sponsored entities
|
$ | 88,522 | $ | 141,832 | $ | 123,684 | ||||||||||||||||||
Obligations
of states and political subdivisions
|
94,181 | $ | 3,844 | 88,147 | $ | 7,788 | 86,031 | $ | 13,610 | |||||||||||||||
Mortgage-backed
securities
|
343,176 | 86,716 | 98,025 | |||||||||||||||||||||
U.S.
Treasury securities
|
863 | 484 | 104 | |||||||||||||||||||||
Money
market mutual funds
|
1,396 | 1,396 | 925 | |||||||||||||||||||||
Equity
securities
|
9,363 | 7,910 | 6,298 | |||||||||||||||||||||
Other
|
5,132 | |||||||||||||||||||||||
Total
|
$ | 542,633 | $ | 3,844 | $ | 326,485 | $ | 7,788 | $ | 315,067 | $ | 13,610 |
After
One But
|
After
Five But
|
|||||||||||||||||||||||||||||||
Within
One Year
|
Within
Five Years
|
Within
Ten Years
|
After
Ten Years
|
|||||||||||||||||||||||||||||
(In
thousands)
|
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
||||||||||||||||||||||||
Obligations
of U.S. government-sponsored entities
|
$ | 63,238 | 4.2 | % | $ | 17,256 | 4.8 | % | $ | 7,025 | 5.2 | % | $ | 1,003 | 4.9 | % | ||||||||||||||||
Obligations
of states and political subdivisions
|
3,288 | 6.1 | 44,882 | 5.6 | 32,935 | 5.5 | 13,076 | 6.1 | ||||||||||||||||||||||||
Mortgage-backed
securities
|
21,314 | 4.6 | 23,490 | 4.8 | 33,244 | 4.9 | 265,128 | 5.5 | ||||||||||||||||||||||||
U.S.
Treasury securities
|
605 | 3.4 | 258 | 3.1 | ||||||||||||||||||||||||||||
Money
market mutual funds
|
1,396 | 4.5 | ||||||||||||||||||||||||||||||
Other
|
5,132 | 7.2 | ||||||||||||||||||||||||||||||
Total
|
$ | 89,841 | 4.3 | % | $ | 85,886 | 4.4 | % | $ | 73,204 | 4.4 | % | $ | 284,339 | 5.5 | % |
After
One But
|
After
Five But
|
|||||||||||||||||||||||||||||||
Within
One Year
|
Within
Five Years
|
Within
Ten Years
|
After
Ten Years
|
|||||||||||||||||||||||||||||
(In
thousands)
|
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
Amount
|
Rate
|
||||||||||||||||||||||||
Obligations
of states and political subdivisions
|
$ | 1,980 | 6.8 | % | $ | 789 | 6.6 | % | $ | 0 | 0 | % | $ | 1,075 | 6.3 | % |
Years
Ended December 31,
|
2007
|
2006
|
2005
|
|||||||||||||||||||||
(In
thousands)
|
Average
Balance
|
Average
Rate
|
Average
Balance
|
Average
Rate
|
Average
Balance
|
Average
Rate
|
||||||||||||||||||
Noninterest
bearing demand
|
$ | 214,423 | $ | 195,982 | $ | 179,197 | ||||||||||||||||||
Interest
bearing demand
|
258,992 | 1.42 | % | 260,417 | 1.45 | % | 214,548 | .88 | % | |||||||||||||||
Savings
|
244,299 | 2.17 | 212,948 | 2.08 | 182,337 | 1.41 | ||||||||||||||||||
Time
|
748,939 | 4.83 | 587,047 | 4.15 | 453,419 | 3.24 | ||||||||||||||||||
Total
|
$ | 1,466,653 | 3.08 | % | $ | 1,256,394 | 2.59 | % | $ | 1,029,501 | 1.85 | % |
(In
thousands)
|
Amount
|
|||
3
months or less
|
$ | 48,724 | ||
Over
3 through 6 months
|
82,323 | |||
Over
6 through 12 months
|
85,345 | |||
Over
12 months
|
36,111 | |||
Total
|
$ | 252,503 |
(In
thousands)
|
2007
|
2006
|
2005
|
|||||||||
Amount
outstanding at year-end
|
$ | 80,755 | $ | 76,718 | $ | 72,115 | ||||||
Maximum
outstanding at any month-end
|
155,362 | 113,926 | 166,550 | |||||||||
Average
outstanding
|
97,192 | 97,489 | 82,717 | |||||||||
Weighted
average rate at year-end
|
3.71 | % | 4.55 | % | 3.89 | % | ||||||
Weighted
average rate during the year
|
4.63 | 4.80 | 3.13 |
Payments
Due by Period
|
||||||||||||||||||||
Contractual
Obligations (In thousands)
|
Total
|
Less
Than
One
Year
|
One
to Three
Years
|
Three
to Five
Years
|
More
Than Five
Years
|
|||||||||||||||
Long-term
FHLB debt
|
$
|
66,526 | $ | 10,565 | $ | 14,079 | $ | 17,015 | $ | 24,867 | ||||||||||
Subordinated
notes payable
|
48,970 | 48,970 | ||||||||||||||||||
Securities
sold under agreements to repurchase
|
200,000 | 50,000 | 50,000 | 100,000 | ||||||||||||||||
Unfunded
postretirement benefit obligations
|
4,930 | 361 | 823 | 894 | 2,852 | |||||||||||||||
Operating
leases
|
3,906 | 596 | 962 | 656 | 1,692 | |||||||||||||||
Capital
lease obligations
|
813 | 237 | 243 | 248 | 85 | |||||||||||||||
Total
|
$ | 325,145 | $ | 11,759 | $ | 66,107 | $ | 68,813 | $ | 178,466 |
Farmers
Capital
Bank
Corporation
|
Regulatory
Minimum
|
|||||||
Tier
1 risk-based
|
11.55 | % | 4.00 | % | ||||
Total
risk-based
|
12.60 | 8.00 | ||||||
Leverage
|
8.08 | 4.00 |
Years
Ended December 31,
|
2007
|
2006
|
2005
|
2004
|
2003
|
||||||||||||||||
Percentage
of dividends declared to income from continuing operations
|
64.52 | % | 78.89 | % | 61.67 | % | 68.10 | % | 70.70 | % | |||||||||||
Percentage
of average shareholders’ equity to average total assets1
|
9.33 | 10.04 | 10.19 | 10.45 | 10.88 |
High
|
Low
|
Dividends
Declared
|
||||||||||
2007
|
||||||||||||
Fourth
Quarter
|
$ | 30.72 | $ | 26.43 | $ | .33 | ||||||
Third
Quarter
|
33.50 | 28.35 | .33 | |||||||||
Second
Quarter
|
31.66 | 28.29 | .33 | |||||||||
First
Quarter
|
35.35 | 29.00 | .33 | |||||||||
2006
|
||||||||||||
Fourth
Quarter
|
$ | 36.98 | $ | 32.40 | $ | .44 | ||||||
Third
Quarter
|
34.59 | 29.78 | .33 | |||||||||
Second
Quarter
|
32.82 | 29.25 | .33 | |||||||||
First
Quarter
|
33.54 | 30.59 | .33 |
G.
Anthony Busseni
|
C.
Douglas Carpenter
|
President
and CEO
|
Senior
Vice President, Secretary, and CFO
|
March
12, 2008
|
December
31, (In thousands, except share data)
|
2007
|
2006 | 1 | |||||
Assets
|
||||||||
Cash
and cash equivalents:
|
||||||||
Cash
and due from banks
|
$ | 44,896 | $ | 115,640 | ||||
Interest
bearing deposits in other banks
|
2,290 | 1,783 | ||||||
Federal
funds sold and securities purchased under agreements to
resell
|
31,954 | 39,405 | ||||||
Total
cash and cash equivalents
|
79,140 | 156,828 | ||||||
Investment
securities:
|
||||||||
Available
for sale, amortized cost of $542,259 (2007) and $328,499
(2006)
|
542,633 | 326,485 | ||||||
Held
to maturity, fair value of $3,863 (2007) and $7,849 (2006)
|
3,844 | 7,788 | ||||||
Total
investment securities
|
546,477 | 334,273 | ||||||
Loans,
net of unearned income
|
1,291,985 | 1,197,836 | ||||||
Allowance
for loan losses
|
(14,216 | ) | (11,999 | ) | ||||
Loans,
net
|
1,277,769 | 1,185,837 | ||||||
Premises
and equipment, net
|
38,663 | 37,775 | ||||||
Company-owned
life insurance
|
34,171 | 32,929 | ||||||
Goodwill
|
52,408 | 42,822 | ||||||
Other
intangible assets, net
|
9,543 | 9,755 | ||||||
Other
assets
|
30,076 | 24,889 | ||||||
Total
assets
|
$ | 2,068,247 | $ | 1,825,108 | ||||
Liabilities
|
||||||||
Deposits:
|
||||||||
Noninterest
bearing
|
$ | 192,432 | $ | 242,938 | ||||
Interest
bearing
|
1,281,665 | 1,211,882 | ||||||
Total
deposits
|
1,474,097 | 1,454,820 | ||||||
Federal
funds purchased and other short-term borrowings
|
80,755 | 76,718 | ||||||
Securities
sold under agreements to repurchase and other long-term
borrowings
|
267,339 | 62,218 | ||||||
Subordinated
notes payable to unconsolidated trusts
|
48,970 | 25,774 | ||||||
Dividends
payable
|
2,436 | 3,472 | ||||||
Other
liabilities
|
26,159 | 25,043 | ||||||
Total
liabilities
|
1,899,756 | 1,648,045 | ||||||
Commitments
and contingencies
|
||||||||
Shareholders’
Equity
|
||||||||
Preferred
stock, no par value; 1,000,000 shares authorized; none
issued
|
||||||||
Common
stock, par value $.125 per share; 9,608,000 shares
authorized;
7,384,865
and 7,895,452 shares issued and outstanding at
December
31, 2007 and 2006, respectively
|
923 | 988 | ||||||
Capital
surplus
|
48,176 | 53,201 | ||||||
Retained
earnings
|
122,498 | 128,652 | ||||||
Accumulated
other comprehensive loss
|
(3,106 | ) | (5,778 | ) | ||||
Total
shareholders’ equity
|
168,491 | 177,063 | ||||||
Total
liabilities and shareholders’ equity
|
$ | 2,068,247 | $ | 1,825,108 |
|
1Certain amounts have been revised
related to the Company’s postretirement benefits plans and equity
accounts. Please refer to Note 1 under the captions “Revised 2006 Balance Sheet and Statement of Changes in
Shareholders’ Equity” and “Treasury
Stock”.
|
(In
thousands, except per share data)
|
||||||||||||
Years
Ended December 31,
|
2007
|
2006
|
2005
|
|||||||||
Interest
Income
|
||||||||||||
Interest
and fees on loans
|
$ | 94,941 | $ | 77,303 | $ | 52,579 | ||||||
Interest
on investment securities:
|
||||||||||||
Taxable
|
12,627 | 9,025 | 7,483 | |||||||||
Nontaxable
|
3,356 | 3,657 | 3,778 | |||||||||
Interest
on deposits in other banks
|
64 | 53 | 61 | |||||||||
Interest
on federal funds sold and securities purchased under agreements
to resell
|
3,269 | 2,302 | 1,750 | |||||||||
Total
interest income
|
114,257 | 92,340 | 65,651 | |||||||||
Interest
Expense
|
||||||||||||
Interest
on deposits
|
45,157 | 32,554 | 19,130 | |||||||||
Interest
on federal funds purchased and other short-term borrowings
|
4,504 | 4,676 | 2,592 | |||||||||
Interest
on subordinated notes payable to unconsolidated trusts
|
2,394 | 1,747 | 623 | |||||||||
Interest
on securities sold under agreements to purchase and other long-term
borrowings
|
3,984 | 2,455 | 2,064 | |||||||||
Total
interest expense
|
56,039 | 41,432 | 24,409 | |||||||||
Net
interest income
|
58,218 | 50,908 | 41,242 | |||||||||
Provision
for loan losses
|
3,638 | 965 | 622 | |||||||||
Net
interest income after provision for loan losses
|
54,580 | 49,943 | 40,620 | |||||||||
Noninterest
Income
|
||||||||||||
Service
charges and fees on deposits
|
11,955 | 9,191 | 8,543 | |||||||||
Allotment
processing fees
|
4,363 | 2,601 | 2,656 | |||||||||
Other
service charges, commissions, and fees
|
2,529 | 2,617 | 2,245 | |||||||||
Data
processing income
|
1,227 | 1,719 | 1,786 | |||||||||
Trust
income
|
2,053 | 1,790 | 1,616 | |||||||||
Investment
securities losses, net
|
(195 | ) | (3 | ) | ||||||||
Gains
on sale of mortgage loans, net
|
591 | 649 | 653 | |||||||||
Income
from company-owned life insurance
|
1,278 | 1,343 | 1,189 | |||||||||
Other
|
161 | 744 | 1,182 | |||||||||
Total
noninterest income
|
24,157 | 20,459 | 19,867 | |||||||||
Noninterest
Expense
|
||||||||||||
Salaries
and employee benefits
|
31,420 | 28,978 | 22,347 | |||||||||
Occupancy
expenses, net
|
4,261 | 3,664 | 2,751 | |||||||||
Equipment
expenses
|
3,232 | 2,929 | 2,587 | |||||||||
Data
processing and communications expenses
|
4,719 | 4,980 | 4,161 | |||||||||
Bank
franchise tax
|
2,086 | 1,831 | 1,377 | |||||||||
Correspondent
bank fees
|
721 | 692 | 883 | |||||||||
Amortization
of intangibles
|
3,362 | 2,009 | 934 | |||||||||
Other
|
9,022 | 8,294 | 7,124 | |||||||||
Total
noninterest expense
|
58,823 | 53,377 | 42,164 | |||||||||
Income
from continuing operations before income taxes
|
19,914 | 17,025 | 18,323 | |||||||||
Income
tax expense from continuing operations
|
4,287 | 3,360 | 3,791 | |||||||||
Income
from continuing operations
|
15,627 | 13,665 | 14,532 | |||||||||
Income
from discontinued operations before income taxes (including gain on
disposals of $9,873 in 2006)
|
11,842 | 1,723 | ||||||||||
Income
tax expense from discontinued operations (including $3,456 related to gain
on disposals in 2006)
|
4,135 | 483 | ||||||||||
Income
from discontinued operations
|
7,707 | 1,240 | ||||||||||
Net
income
|
$ | 15,627 | $ | 21,372 | $ | 15,772 | ||||||
Net
Income Per Common Share
|
||||||||||||
Income
from continuing operations – basic
|
$ | 2.03 | $ | 1.82 | $ | 2.13 | ||||||
Income
from discontinued operations – basic
|
1.03 | .18 | ||||||||||
Net
income per common share – basic
|
2.03 | 2.85 | 2.31 | |||||||||
Income
from continuing operations – diluted
|
2.03 | 1.82 | 2.12 | |||||||||
Income
from discontinued operations - diluted
|
1.02 | .18 | ||||||||||
Net
income per common share - diluted
|
2.03 | 2.84 | 2.30 | |||||||||
Weighted
Average Shares Outstanding
|
||||||||||||
Basic
|
7,706 | 7,511 | 6,831 | |||||||||
Diluted
|
7,706 | 7,526 | 6,864 |
(In
thousands)
|
||||||||||||
Years
Ended December 31,
|
2007
|
2006
|
2005
|
|||||||||
Net
income
|
$ | 15,627 | $ | 21,372 | $ | 15,772 | ||||||
Other
comprehensive income:
|
||||||||||||
Unrealized
holding gain (loss) on available for sale securities arising during the
period on securities held at end of period, net of tax of $830, $306, and
$1,410, respectively
|
1,542 | 568 | (2,622 | ) | ||||||||
Reclassification
adjustment for prior period unrealized loss previously reported in other
comprehensive income recognized during current period, net of tax of $5,
$22, and $3, respectively
|
10 | 40 | 5 | |||||||||
Change
in unfunded portion of postretirement benefit obligation, net of tax of
$603
|
1,120 | |||||||||||
Other
comprehensive income (loss)
|
2,672 | 608 | (2,617 | ) | ||||||||
Comprehensive
income
|
$ | 18,299 | $ | 21,980 | $ | 13,155 |
(In
thousands, except per share data)
|
Accumulated
Other
|
Total
|
||||||||||||||||||||||
Years
Ended
|
Common
Stock
|
Capital
|
Retained
|
Comprehensive
|
Shareholders’
|
|||||||||||||||||||
December
31, 2007, 2006, and 2005
|
Shares
|
Amount
|
Surplus
|
Earnings
|
Income
(Loss)
|
Equity1
|
||||||||||||||||||
Balance
at January 1, 2005
|
6,784 | $ | 848 | $ | 17,427 | $ | 112,475 | $ | 700 | $ | 131,450 | |||||||||||||
Net
income
|
15,772 | 15,772 | ||||||||||||||||||||||
Other
comprehensive loss
|
(2,617 | ) | (2,617 | ) | ||||||||||||||||||||
Cash
dividends declared, $1.32 per share
|
(8,961 | ) | (8,961 | ) | ||||||||||||||||||||
Purchase
of common stock
|
(17 | ) | (2 | ) | (44 | ) | (525 | ) | (571 | ) | ||||||||||||||
Stock
options exercised, including related tax benefits
|
31 | 4 | 770 | 774 | ||||||||||||||||||||
Shares
issued pursuant to Employee Stock Purchase Plan
|
7 | 1 | 186 | 187 | ||||||||||||||||||||
Shares
issued in connection with the
purchase
of Citizens Bancorp, Inc.
|
584 | 73 | 18,129 | 18,202 | ||||||||||||||||||||
Balance
at December 31, 2005
|
7,389 | 924 | 36,468 | 118,761 | (1,917 | ) | 154,236 | |||||||||||||||||
Net
income
|
21,372 | 21,372 | ||||||||||||||||||||||
Other
comprehensive income
|
608 | 608 | ||||||||||||||||||||||
Cash
dividends declared, $1.43 per share
|
(10,781 | ) | (10,781 | ) | ||||||||||||||||||||
Purchase
of common stock
|
(26 | ) | (3 | ) | (117 | ) | (700 | ) | (820 | ) | ||||||||||||||
Stock
options exercised, including related tax benefits
|
60 | 8 | 1,536 | 1,544 | ||||||||||||||||||||
Shares
issued pursuant to Employee Stock Purchase Plan
|
8 | 1 | 222 | 223 | ||||||||||||||||||||
Stock
option expense
|
154 | 154 | ||||||||||||||||||||||
Shares
issued in connection with the purchase of Citizens
National Bancshares, Inc.
|
464 | 58 | 14,938 | 14,996 | ||||||||||||||||||||
Adjustment
to initially apply SFAS
No.
158, net of tax of $2,4071
|
(4,469 | ) | (4,469 | ) | ||||||||||||||||||||
Balance
at December 31, 2006
|
7,895 | 988 | 53,201 | 128,652 | (5,778 | ) | 177,063 | |||||||||||||||||
Net
income
|
15,627 | 15,627 | ||||||||||||||||||||||
Other
comprehensive income
|
2,672 | 2,672 | ||||||||||||||||||||||
Cash
dividends declared, $1.32 per share
|
(10,082 | ) | (10,082 | ) | ||||||||||||||||||||
Purchase
of common stock
|
(584 | ) | (73 | ) | (6,877 | ) | (11,699 | ) | (18,649 | ) | ||||||||||||||
Stock
options exercised, including related tax benefits
|
63 | 7 | 1,540 | 1,547 | ||||||||||||||||||||
Shares
issued pursuant to Employee Stock Purchase Plan
|
11 | 1 | 253 | 254 | ||||||||||||||||||||
Stock
option expense
|
59 | 59 | ||||||||||||||||||||||
Balance
at December 31, 2007
|
7,385 | $ | 923 | $ | 48,176 | $ | 122,498 | $ | (3,106 | ) | $ | 168,491 |
Years
Ended December 31, (In thousands)
|
2007
|
2006
|
2005
|
|||||||||
Cash
Flows from Operating Activities
|
||||||||||||
Net
income
|
$ | 15,627 | $ | 21,372 | $ | 15,772 | ||||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||||
Depreciation
and amortization
|
7,477 | 5,826 | 4,085 | |||||||||
Net
amortization (accretion) of investment security premiums and
discounts:
|
||||||||||||
Available
for sale
|
(1,132 | ) | (424 | ) | 323 | |||||||
Held
to maturity
|
1 | (25 | ) | (39 | ) | |||||||
Provision
for loan losses
|
3,638 | 965 | 622 | |||||||||
Deferred
income tax benefit
|
(1,807 | ) | (1,848 | ) | (194 | ) | ||||||
Noncash
stock option expense
|
59 | 125 | ||||||||||
Mortgage
loans originated for sale
|
(19,684 | ) | (29,539 | ) | (35,456 | ) | ||||||
Proceeds
from sale of mortgage loans
|
21,081 | 26,973 | 35,849 | |||||||||
Gains
on sale of mortgage loans, net
|
(591 | ) | (649 | ) | (653 | ) | ||||||
Gain
on sale of credit card portfolio
|
(700 | ) | ||||||||||
Loss
(gain) on sale of premises and equipment, net
|
89 | (174 | ) | 14 | ||||||||
Loss
on sale of available for sale investment securities, net
|
195 | 3 | ||||||||||
Increase
in accrued interest receivable
|
(1,602 | ) | (3,450 | ) | (1,705 | ) | ||||||
Income
from company-owned life insurance
|
(1,242 | ) | (1,301 | ) | (1,162 | ) | ||||||
Decrease
in other assets
|
1,124 | 6,157 | 2,869 | |||||||||
Increase
in accrued interest payable
|
1,672 | 2,594 | 618 | |||||||||
(Decrease)
increase in other liabilities
|
(2,656 | ) | 4,409 | (1,335 | ) | |||||||
Gain
on sales of discontinued operations
|
(9,873 | ) | ||||||||||
Net
cash provided by discontinued operating activities
|
1,390 | 1,638 | ||||||||||
Net
cash provided by operating activities
|
22,054 | 22,723 | 20,549 | |||||||||
Cash
Flows from Investing Activities
|
||||||||||||
Proceeds
from maturities and calls of investment securities:
|
||||||||||||
Available
for sale
|
323,155 | 121,699 | 164,014 | |||||||||
Held
to maturity
|
3,943 | 5,847 | 4,314 | |||||||||
Proceeds
from sale of available for sale investment securities
|
20,009 | 19,263 | 3,038 | |||||||||
Purchases
of available for sale investment securities:
|
(555,792 | ) | (138,081 | ) | (158,252 | ) | ||||||
Loans
originated for investment, net of principal collected
|
(96,376 | ) | (112,426 | ) | (37,461 | ) | ||||||
Purchase
of company-owned life insurance
|
(1,579 | ) | ||||||||||
Payment
of prior year accrued purchase price-Citizens Bancorp,
Inc.
|
(21,846 | ) | ||||||||||
Net
cash acquired in purchase of Citizens National Bancshares,
Inc.
|
1,066 | |||||||||||
Purchase
of Citizens Bancorp, Inc., net of cash acquired
|
(29 | ) | 10,620 | |||||||||
Purchase
of PNC Military Allotment operations, net of cash acquired
|
(1,943 | ) | ||||||||||
Purchase
price refinements of previous acquisitions
|
50 | (205 | ) | |||||||||
Investment
in unconsolidated trusts
|
(696 | ) | (774 | ) | ||||||||
Additions
to mortgage servicing rights, net
|
(94 | ) | (47 | ) | ||||||||
Purchases
of premises and equipment
|
(5,245 | ) | (9,682 | ) | (3,341 | ) | ||||||
Proceeds
from sale of equipment
|
330 | 720 | 124 | |||||||||
Net
cash received on disposal of discontinued operations
|
47 | |||||||||||
Net
cash provided by discontinued investing activities
|
9,384 | 15,058 | ||||||||||
Net
cash used in investing activities
|
(312,659 | ) | (125,664 | ) | (2,865 | ) | ||||||
Cash
Flows from Financing Activities
|
||||||||||||
Net
increase in deposits
|
8,407 | 123,728 | 29,891 | |||||||||
Net
increase in federal funds purchased and other short-term
borrowings
|
4,037 | 1,722 | 10,767 | |||||||||
Proceeds
from securities sold under agreements to purchase and other long-term
debt
|
249,196 | 26,198 | 27,774 | |||||||||
Repayments
of securities sold under agreements to purchase and other long-term
debt
|
(20,879 | ) | (13,496 | ) | (7,750 | ) | ||||||
Dividends
paid
|
(11,118 | ) | (9,553 | ) | (8,949 | ) | ||||||
Purchase
of common stock
|
(18,649 | ) | (820 | ) | (571 | ) | ||||||
Shares
issued under Employee Stock Purchase Plan
|
254 | 223 | 187 | |||||||||
Stock
options exercised and related tax benefits
|
1,669 | 1,697 | 880 | |||||||||
Net
cash provided by (used in) discontinued financing
activities
|
3,710 | (12,607 | ) | |||||||||
Net
cash provided by financing activities
|
212,917 | 133,409 | 39,622 | |||||||||
Net
(decrease) increase in cash and cash equivalents
|
(77,688 | ) | 30,468 | 57,306 | ||||||||
Less:
net increase in cash and cash equivalents of discontinued
operations
|
(4,658 | ) | (4,089 | ) | ||||||||
Net
(decrease) increase in cash and cash equivalents from continuing
operations
|
(77,688 | ) | 25,810 | 53,217 | ||||||||
Cash
and cash equivalents from continuing operations at beginning of
year
|
156,828 | 131,018 | 77,801 | |||||||||
Cash
and cash equivalents from continuing operations at end of
year
|
$ | 79,140 | $ | 156,828 | $ | 131,018 | ||||||
(table
continues on next page)
|
Supplemental
Disclosures
|
||||||||||||
Cash
paid during the year for:
|
||||||||||||
Interest
|
$ | 54,367 | $ | 42,685 | $ | 26,973 | ||||||
Income
taxes
|
9,854 | 4,900 | 2,725 | |||||||||
Transfers
from loans to repossessed assets
|
3,952 | 1,973 | 2,751 | |||||||||
Cash
dividend declared and unpaid at year-end
|
2,436 | 3,472 | 2,244 | |||||||||
Issuance
of 464 and 584 shares of common stock to acquire Citizens National
Bancshares, Inc. and Citizens Bancorp, Inc., respectively
|
14,996 | 18,202 | ||||||||||
Acquisition
purchase price payable at year-end
|
21,846 |
1.
|
Summary
of Significant Accounting Policies
|
(In
thousands, except per share data)
Years
Ended December 31,
|
2007
|
2006
|
2005
|
|||||||||
Net
income, basic and diluted
|
$ | 15,627 | $ | 21,372 | $ | 15,772 | ||||||
Average
shares outstanding
|
7,706 | 7,511 | 6,831 | |||||||||
Effect
of dilutive stock options
|
15 | 33 | ||||||||||
Average
diluted shares outstanding
|
7,706 | 7,526 | 6,864 | |||||||||
Net
income per share, basic
|
$ | 2.03 | $ | 2.85 | $ | 2.31 | ||||||
Net
income per share, diluted
|
2.03 | 2.84 | 2.30 |
Income
from continuing operations, basic and diluted
|
$ | 15,627 | $ | 13,665 | $ | 14,532 | ||||||
Income
per share from continuing operations, basic
|
$ | 2.03 | $ | 1.82 | $ | 2.13 | ||||||
Income
per share from continuing operations, diluted
|
2.03 | 1.82 | 2.12 |
Income
from discontinued operations, basic and diluted
|
$ | 0 | $ | 7,707 | $ | 1,240 | ||||||
Income
per share from discontinued operations, basic
|
$ | 0 | $ | 1.03 | $ | .18 | ||||||
Income
per share from discontinued operations, diluted
|
0 | 1.02 | .18 |
(In
thousands, except per share data)
Years
Ended December 31,
|
2005
|
|||
Net
Income
|
||||
As
reported
|
$ | 15,772 | ||
Add: Stock-based
compensation expense included in reported net income
|
||||
Less: Stock-based
compensation expense determined under fair value based method for all
awards, net of related tax effects
|
(112 | ) | ||
Proforma
|
$ | 15,660 | ||
Net
Income Per Common Share
|
||||
Basic,
as reported
|
$ | 2.31 | ||
Basic,
proforma
|
2.29 | |||
Diluted,
as reported
|
2.30 | |||
Diluted,
proforma
|
2.28 |
Income
From Continuing Operations
|
||||
As
reported
|
$ | 14,532 | ||
Add: Stock-based
compensation expense included in reported net income
|
||||
Less: Stock-based
compensation expense determined under fair value based method for all
awards, net of related tax effects
|
(100 | ) | ||
Proforma
|
$ | 14,432 | ||
Income
Per Common Share From Continuing Operations
|
||||
Basic,
as reported
|
$ | 2.13 | ||
Basic,
proforma
|
2.11 | |||
Diluted,
as reported
|
2.12 | |||
Diluted,
proforma
|
2.10 |
Income
From Discontinued Operations
|
||||
As
reported
|
$ | 1,240 | ||
Add: Stock-based
compensation expense included in reported net income
|
||||
Less: Stock-based
compensation expense determined under fair value based method for all
awards, net of related tax effects
|
(12 | ) | ||
Proforma
|
$ | 1,228 | ||
Income
Per Common Share From Discontinued Operations
|
||||
Basic
and diluted, as reported
|
$ | .18 | ||
Basic
and diluted, proforma
|
.18 |
ESPP
|
||||||||||||
2007
|
2006
|
2005
|
||||||||||
Dividend
yield
|
3.97 | % | 3.88 | % | 3.82 | % | ||||||
Expected
volatility
|
15.3
|
14.0 | 13.0 | |||||||||
Risk-free
interest rate
|
4.75 | 4.70 | 2.98 | |||||||||
Expected
life (in years)
|
.25 | .25 | .25 | |||||||||
Fair
value
|
$ | 5.12 | $ | 5.75 | $ | 5.97 |
(In
thousands)
|
November
30, 2006
|
|||
Assets
|
||||
Cash
and cash equivalents
|
$ | 13,544 | ||
Investment
securities
|
32,276 | |||
Loans,
net
|
88,631 | |||
Premises
and equipment, net
|
4,978 | |||
Other
assets
|
5,118 | |||
Total
assets
|
$ | 144,547 | ||
Liabilities
|
||||
Deposits
|
$ | 146,208 | ||
Other
borrowed funds
|
1,459 | |||
Other
liabilities
|
921 | |||
Total
liabilities
|
148,588 | |||
Net
liabilities
|
$ | 4,041 |
(In
thousands)
|
Eleven
months ended
November
30, 2006
|
Year
ended
December
31, 2005
|
||||||
Interest
income
|
$ | 9,008 | $ | 8,443 | ||||
Interest
expense
|
3,696 | 3,370 | ||||||
Net
interest income
|
5,312 | 5,073 | ||||||
Provision
for loan losses
|
17 | 96 | ||||||
Noninterest
income
|
1,272 | 1,305 | ||||||
Noninterest
expense
|
4,597 | 4,559 | ||||||
Income
tax expense
|
679 | 483 | ||||||
Net
income
|
$ | 1,291 | $ | 1,240 |
3.
Investment Securities
|
Amortized
|
Gross
|
Gross
|
Estimated
|
|||||||||||||
December
31, 2007 (In thousands)
|
Cost
|
Unrealized
Gains
|
Unrealized
Losses
|
Fair
Value
|
||||||||||||
Available
For Sale
|
||||||||||||||||
Obligations
of U.S. government-sponsored entities
|
$ | 88,226 | $ | 332 | $ | 36 | $ | 88,522 | ||||||||
Obligations
of states and political subdivisions
|
93,430 | 1,165 | 414 | 94,181 | ||||||||||||
Mortgage-backed
securities
|
343,189 | 1,042 | 1,055 | 343,176 | ||||||||||||
U.S.
Treasury securities
|
863 | 863 | ||||||||||||||
Money
market mutual funds
|
1,396 | 1,396 | ||||||||||||||
Equity
securities
|
9,363 | 9,363 | ||||||||||||||
Other
|
5,792 | 660 | 5,132 | |||||||||||||
Total
securities – available for sale
|
$ | 542,259 | $ | 2,539 | $ | 2,165 | $ | 542,633 | ||||||||
Held
To Maturity
|
||||||||||||||||
Obligations
of states and political subdivisions
|
$ | 3,844 | $ | 19 | $ | 0 | $ | 3,863 |
Amortized
|
Gross
|
Gross
|
Estimated
|
|||||||||||||
December
31, 2006 (In thousands)
|
Cost
|
Unrealized
Gains
|
Unrealized
Losses
|
Fair
Value
|
||||||||||||
Available
For Sale
|
||||||||||||||||
Obligations
of U.S. government-sponsored entities
|
$ | 142,128 | $ | 74 | $ | 370 | $ | 141,832 | ||||||||
Obligations
of states and political subdivisions
|
87,974 | 939 | 766 | 88,147 | ||||||||||||
Mortgage-backed
securities
|
88,607 | 87 | 1,978 | 86,716 | ||||||||||||
U.S.
Treasury securities
|
484 | 484 | ||||||||||||||
Money
market mutual funds
|
1,396 | 1,396 | ||||||||||||||
Equity
securities
|
7,910 | 7,910 | ||||||||||||||
Total
securities – available for sale
|
$ | 328,499 | $ | 1,100 | $ | 3,114 | $ | 326,485 | ||||||||
Held
To Maturity
|
||||||||||||||||
Obligations
of states and political subdivisions
|
$ | 7,788 | $ | 61 | $ | 0 | $ | 7,849 |
Available
For Sale
|
Held
To Maturity
|
|||||||||||||||
Amortized
|
Estimated
|
Amortized
|
Estimated
|
|||||||||||||
December
31, 2007 (In thousands)
|
Cost
|
Fair
Value
|
Cost
|
Fair
Value
|
||||||||||||
Due
in one year or less
|
$ | 68,516 | $ | 68,527 | $ | 1,980 | $ | 1,995 | ||||||||
Due
after one year through five years
|
61,939 | 62,396 | 789 | 793 | ||||||||||||
Due
after five years through ten years
|
39,519 | 39,960 | ||||||||||||||
Due
after ten years
|
19,733 | 19,211 | 1,075 | 1,075 | ||||||||||||
Mortgage-backed
securities
|
343,189 | 343,176 | ||||||||||||||
Total
|
$ | 532,896 | $ | 533,270 | $ | 3,844 | $ | 3,863 |
Less
than 12 Months
|
12
Months or More
|
Total
|
||||||||||||||||||||||
December
31, 2007 (In thousands)
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
||||||||||||||||||
Obligations
of U.S. government-sponsored entities
|
$ | 999 | $ | 4 | $ | 11,159 | $ | 33 | $ | 12,158 | $ | 36 | ||||||||||||
Obligations
of states and political subdivisions
|
7,734 | 82 | 21,323 | 331 | 29,057 | 414 | ||||||||||||||||||
Mortgage-backed
securities
|
11,004 | 46 | 45,740 | 1,009 | 56,744 | 1,055 | ||||||||||||||||||
Other
|
5,132 | 660 | 5,132 | 660 | ||||||||||||||||||||
Total
|
$ | 24,869 | $ | 792 | $ | 78,222 | $ | 1,373 | $ | 103,091 | $ | 2,165 |
Less
than 12 Months
|
12
Months or More
|
Total
|
||||||||||||||||||||||
December
31, 2006 (In thousands)
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
||||||||||||||||||
Obligations
of U.S. government-sponsored entities
|
$ | 25,591 | $ | 34 | $ | 34,949 | $ | 336 | $ | 60,540 | $ | 370 | ||||||||||||
Obligations
of states and political subdivisions
|
12,756 | 63 | 25,793 | 703 | 38,549 | 766 | ||||||||||||||||||
Mortgage-backed
securities
|
2,467 | 6 | 68,993 | 1,972 | 71,460 | 1,978 | ||||||||||||||||||
Total
|
$ | 40,814 | $ | 103 | $ | 129,735 | $ | 3,011 | $ | 170,549 | $ | 3,114 |
4.
Loans
|
December
31, (In thousands)
|
2007
|
2006
|
||||||
Commercial,
financial, and agricultural
|
$ | 154,015 | $ | 197,613 | ||||
Real
estate – construction
|
254,788 | 176,779 | ||||||
Real
estate mortgage – residential
|
405,992 | 381,081 | ||||||
Real
estate mortgage – farmland and other commercial
enterprises
|
394,900 | 351,793 | ||||||
Installment
loans
|
52,028 | 57,116 | ||||||
Lease
financing
|
34,109 | 37,522 | ||||||
Total
loans
|
1,295,832 | 1,201,904 | ||||||
Less
unearned income
|
(3,847 | ) | (4,068 | ) | ||||
Total
loans, net of unearned income
|
$ | 1,291,985 | $ | 1,197,836 |
(In
thousands)
|
Amount
|
|||
Balance,
December 31, 2006
|
$ | 25,903 | ||
New
loans
|
21,442 | |||
Repayments
|
(16,440 | ) | ||
Loans
no longer meeting disclosure requirements, new loans meeting disclosure
requirements, and other adjustments
|
(1,630 | ) | ||
Balance,
December 31, 2007
|
$ | 29,275 |
5.
Allowance for Loan Losses
|
Years
Ended December 31, (In thousands)
|
2007
|
2006
|
2005
|
|||||||||
Balance,
beginning of year
|
$ | 11,999 | $ | 11,069 | $ | 11,043 | ||||||
Acquisition
of Citizens National Bancshares, Inc.
|
1,066 | |||||||||||
Acquisition
of Citizens Bancorp, Inc.
|
1,410 | |||||||||||
Provision
for loan losses
|
3,638 | 965 | 622 | |||||||||
Recoveries
|
733 | 678 | 439 | |||||||||
Loans
charged off
|
(2,154 | ) | (1,779 | ) | (2,445 | ) | ||||||
Balance,
end of year
|
$ | 14,216 | $ | 11,999 | $ | 11,069 |
Years
Ended December 31, (In thousands)
|
2007
|
2006
|
||||||
Year-end
loans with no allocated allowance for loan losses
|
$ | 1,877 | $ | 3,153 | ||||
Year-end
loans with allocated allowance for loan losses
|
28,127 | 1,920 | ||||||
Total
|
$ | 30,004 | $ | 5,073 | ||||
Amount
of the allowance for loan losses allocated
|
$ | 1,834 | $ | 105 |
Years
Ended December 31, (In thousands)
|
2007
|
2006
|
2005
|
|||||||||
Average
of individually impaired loans during year
|
$ | 13,037 | $ | 5,151 | $ | 768 | ||||||
Interest
income recognized during impairment
|
1,382 | 323 | ||||||||||
Cash-basis
interest income recognized
|
683 |
December
31, (In thousands)
|
2007
|
2006
|
||||||
Nonaccrual
loans
|
$ | 18,073 | $ | 1,462 | ||||
Loans
past due 90 days or more and still accruing
|
2,977 | 2,856 | ||||||
Total
nonperforming loans
|
$ | 21,050 | $ | 4,318 |
6.
Premises and Equipment
|
December
31, (In thousands)
|
2007
|
2006
|
||||||
Land,
buildings, and leasehold improvements
|
$ | 48,767 | $ | 45,652 | ||||
Furniture
and equipment
|
20,180 | 21,470 | ||||||
Total
premises and equipment
|
68,947 | 67,122 | ||||||
Less
accumulated depreciation and amortization
|
(30,284 | ) | (29,347 | ) | ||||
Premises
and equipment, net
|
$ | 38,663 | $ | 37,775 |
7.
Deposit Liabilities
|
(In
thousands)
|
Amount
|
|||
2008
|
$ | 630,507 | ||
2009
|
90,041 | |||
2010
|
28,120 | |||
2011
|
11,565 | |||
2012
|
7,436 | |||
Thereafter
|
2,352 | |||
Total
|
$ | 770,021 |
8.
Federal Funds Purchased and Other Short-term
Borrowings
|
December
31, (Dollars in thousands)
|
2007
|
2006
|
||||||
Federal
funds purchased and securities sold under agreement to
repurchase
|
$ | 80,315 | $ | 67,941 | ||||
FHLB
advances
|
8,000 | |||||||
Other
|
440 | 777 | ||||||
Total
short-term
|
$ | 80,755 | $ | 76,718 | ||||
Average
balance during the year
|
$ | 97,192 | $ | 97,489 | ||||
Maximum
month-end balance during the year
|
155,362 | 113,926 | ||||||
Average
interest rate during the year
|
4.63 | % | 4.80 | % | ||||
Average
interest rate at year-end
|
3.71 | 4.55 |
Average
|
Average
|
|||||||||||||||
December
31, (Dollars in thousands)
|
2007
|
Rate
|
2006
|
Rate
|
||||||||||||
FHLB
advances
|
$ | 66,526 | 4.65 | % | $ | 61,174 | 4.51 | % | ||||||||
Subordinated
notes payable
|
48,970 | 6.71 | 25,774 | 6.96 | ||||||||||||
Securities
sold under agreements to repurchase
|
200,000 | 3.95 | ||||||||||||||
Other
|
813 | 2.32 | 1,044 | 2.32 | ||||||||||||
Total
long-term
|
$ | 316,309 | 4.52 | % | $ | 87,992 | 5.20 | % |
(In
thousands)
|
Amount
|
|||
2008
|
$ | 10,802 | ||
2009
|
13,787 | |||
2010
|
50,783 | |||
2011
|
5,613 | |||
2012
|
61,486 | |||
Thereafter
|
173,838 | |||
Total
|
$ | 316,309 |
December
31, (In thousands)
|
2007
|
2006
|
2005
|
|||||||||
Currently
payable
|
$ | 6,094 | $ | 5,208 | $ | 3,985 | ||||||
Deferred
|
(1,807 | ) | (1,848 | ) | (194 | ) | ||||||
Total
applicable to continuing operations
|
4,287 | 3,360 | 3,791 | |||||||||
Deferred
tax (credited) charged to components of shareholders’
equity:
|
||||||||||||
Unfunded
status of postretirement benefits
|
(139 | ) | 1,664 | |||||||||
Net
unrealized securities gains (losses)
|
836 | 237 | (1,362 | ) | ||||||||
Total
income taxes from continuing operations
|
$ | 4,984 | $ | 5,261 | $ | 2,429 |
December
31, (In thousands)
|
2006
|
2005
|
||||||
Currently
payable
|
$ | 4,287 | $ | 294 | ||||
Deferred
|
(152 | ) | 189 | |||||
Total
applicable to discontinued operations
|
4,135 | 483 | ||||||
Deferred
tax charged to components of shareholders’ equity:
|
||||||||
Net
unrealized securities gains (losses)
|
90 | (47 | ) | |||||
Total
income taxes from discontinued operations
|
$ | 4,225 | $ | 436 |
December
31,
|
2007
|
2006
|
2005
|
|||||||||
Federal
statutory rate
|
35.0 | % | 35.0 | % | 35.0 | % | ||||||
Changes
from statutory rates resulting from:
|
||||||||||||
Tax-exempt
interest
|
(8.1 | ) | (9.7 | ) | (8.3 | ) | ||||||
Nondeductible
interest to carry tax-exempt obligations
|
1.1 | 1.2 | .7 | |||||||||
Tax
credits
|
(2.7 | ) | (3.8 | ) | (3.6 | ) | ||||||
Premium
income not subject to tax
|
(1.9 | ) | (2.4 | ) | (.2 | ) | ||||||
Company-owned
life insurance
|
(2.1 | ) | (2.4 | ) | (1.9 | ) | ||||||
Other,
net
|
.2 | 1.8 | (1.0 | ) | ||||||||
Effective
tax rate on pretax income from continuing operations
|
21.5 | % | 19.7 | % | 20.7 | % |
December
31,
|
2006
|
2005
|
||||||
Federal
statutory rate
|
35.0 | % | 35.0 | % | ||||
Changes
from statutory rates resulting from:
|
||||||||
Tax-exempt
interest
|
(.7 | ) | (5.4 | ) | ||||
Nondeductible
interest to carry tax-exempt obligations
|
.1 | .6 | ||||||
Company-owned
life insurance
|
(.2 | ) | (1.1 | ) | ||||
Other,
net
|
.7 | (1.1 | ) | |||||
Effective
tax rate on pretax income from discontinued operations
|
34.9 | % | 28.0 | % |
December
31, (In thousands)
|
2007
|
2006
|
||||||
Assets
|
||||||||
Allowance
for loan losses
|
$ | 4,891 | $ | 4,122 | ||||
Unrealized
losses on available for sale investment securities, net
|
705 | |||||||
Deferred
directors’ fees
|
242 | 131 | ||||||
Postretirement
benefit obligations
|
3,894 | 3,251 | ||||||
Stock
options
|
35 | 513 | ||||||
Commissions
|
12 | |||||||
Self-funded
insurance
|
269 | 279 | ||||||
Paid
time off
|
614 | 455 | ||||||
Other
|
7 | 157 | ||||||
Total
deferred tax assets
|
9,952 | 9,625 | ||||||
Liabilities
|
||||||||
Depreciation
|
533 | 925 | ||||||
Unrealized
gains on available for sale investment securities, net
|
131 | |||||||
Prepaid
expenses
|
636 | 590 | ||||||
Discount
on investment securities
|
1,012 | 1,040 | ||||||
Deferred
loan fees
|
1,197 | 1,000 | ||||||
Lease
financing operations
|
1,502 | 1,942 | ||||||
Intangibles
|
2,577 | 2,874 | ||||||
Total
deferred tax liabilities
|
7,588 | 8,371 | ||||||
Net
deferred tax asset
|
$ | 2,364 | $ | 1,254 |
(In
thousands)
|
2007
|
2006
|
||||||
Change
in Benefit Obligation
|
||||||||
Obligation
at beginning of year
|
$ | 561 | $ | 374 | ||||
Service
cost
|
31 | 41 | ||||||
Interest
cost
|
32 | 22 | ||||||
Actuarial
(gain) loss
|
(157 | ) | 124 | |||||
Benefit
payments
|
(5 | ) | ||||||
Obligation
at end of year
|
$ | 462 | $ | 561 |
(In
thousands)
|
2007
|
2006
|
||||||
Service
cost
|
$ | 31 | $ | 41 | ||||
Interest
cost
|
32 | 21 | ||||||
Recognized
net actuarial loss
|
22 | 17 | ||||||
Net
periodic benefit cost
|
$ | 85 | $ | 79 | ||||
Major
assumptions:
|
||||||||
Discount
rate
|
5.75 | % | 5.75 | % |
(In
thousands)
|
Supplemental
Retirement Plan |
||||
2008
|
$ | 5 | |||
2009
|
5 | ||||
2010
|
5 | ||||
2011
|
5 | ||||
2012
|
5 | ||||
2013-2017
|
|
134 | |||
Total
|
$ | 159 |
(In
thousands)
|
2007
|
2006
|
||||||
Unrecognized
net actuarial loss
|
$ | 125 | $ | 304 | ||||
Total
|
$ | 125 | $ | 304 |
(In
thousands)
|
Supplemental
Retirement Plan
|
|||
Unrecognized
net actuarial loss
|
$ | 8 | ||
Total
|
$ | 8 |
2007
|
||||||||
Weighted
|
||||||||
Average
|
||||||||
Shares
|
Price
|
|||||||
Outstanding
at January 1
|
125,522 | $ | 28.62 | |||||
Exercised
|
(62,901 | ) | 24.61 | |||||
Outstanding
at December 31
|
62,621 | $ | 32.66 | |||||
Options
exercisable at year-end
|
62,621 | $ | 32.66 |
Outstanding
|
Exercisable
|
||||||||||||||||||||
Weighted
Average
|
|||||||||||||||||||||
Remaining
Contractual
|
Weighted
Average
|
Weighted
Average
|
|||||||||||||||||||
Exercise
Price
|
Number
|
Life
(Years)
|
Exercise
Price
|
Number
|
Exercise
Price
|
||||||||||||||||
$29.75 | 26,572 | 2.00 | $ | 29.75 | 26,572 | $ | 29.75 | ||||||||||||||
$34.80 | 36,049 | 6.83 | 34.80 | 36,049 | 34.80 | ||||||||||||||||
Outstanding
at year-end
|
62,621 | 4.78 | $ | 32.66 | 62,621 | $ | 32.66 |
(In
thousands)
|
2007
|
2006
|
2005
|
|||||||||
Tax
benefit realized from options exercised
|
$ | 123 | $ | 168 | $ | 109 | ||||||
Total
intrinsic value of options exercised
|
353 | 479 | 311 | |||||||||
Cash
received from options exercised
|
1,546 | 1,529 | 771 |
13.
Postretirement Medical Benefits
|
(In
thousands)
|
2007
|
2006 | 1 | |||||
Change
in Benefit Obligation
|
||||||||
Obligation
at beginning of year
|
$ | 11,164 | $ | 9,437 | ||||
Service
cost
|
441 | 258 | ||||||
Interest
cost
|
632 | 415 | ||||||
Prior
service cost
|
299 | |||||||
Actuarial
(gain) loss
|
(981 | ) | 1,091 | |||||
Participant
contributions
|
55 | 32 | ||||||
Benefit
payments
|
(308 | ) | (368 | ) | ||||
Obligation
at end of year
|
$ | 11,003 | $ | 11,164 |
(In
thousands)
|
2007
|
2006
|
||||||
Service
cost
|
$ | 441 | $ | 258 | ||||
Interest
cost
|
632 | 415 | ||||||
Amortization
of transition obligation
|
101 | 102 | ||||||
Recognized
prior service cost
|
299 | 268 | ||||||
Recognized
net actuarial loss
|
162 | 21 | ||||||
Net
periodic benefit cost
|
$ | 1,635 | $ | 1,064 | ||||
Major
assumptions:
|
||||||||
Discount
rate
|
5.75 | % | 5.75 | % | ||||
Retiree
participation rate (Plan 1)
|
100.00 | 100.00 | ||||||
Retiree
participation rate (Plan 2)
|
72.00 | 80.00 |
(In
thousands)
|
1%
Increase
|
1%
Decrease
|
||||||
Effect
on total of service and interest cost components of net periodic
postretirement health care benefit cost
|
$ | 239 | $ | (185 | ) | |||
Effect
on accumulated postretirement benefit obligation
|
1,928 | (1,539 | ) |
(In
thousands)
|
Postretirement
Medical Benefits |
|||||
2008
|
$ | 356 | ||||
2009
|
393 | |||||
2010
|
420 | |||||
2011
|
436 | |||||
2012
|
448 | |||||
2013-2017 | 2,718 | |||||
Total
|
$ | 4,771 |
(In
thousands)
|
2007
|
2006
|
||||||
Unrecognized
net actuarial loss
|
$ | 2,554 | $ | 3,698 | ||||
Unrecognized
transition obligation
|
507 | 609 | ||||||
Unrecognized
prior service cost
|
1,966 | 2,265 | ||||||
Total
|
$ | 5,027 | $ | 6,572 |
(In
thousands)
|
Postretirement
Medical Benefits
|
|||
Unrecognized
net actuarial loss
|
$ | 92 | ||
Transition
obligation
|
101 | |||
Unrecognized
prior service cost
|
299 | |||
Total
|
$ | 492 |
(In
thousands)
|
Operating
Leases
|
Capital
Lease
|
||||||
2008
|
$ | 596 | $ | 254 | ||||
2009
|
525 | 254 | ||||||
2010
|
437 | 254 | ||||||
2011
|
374 | 84 | ||||||
2012
|
282 | |||||||
Thereafter
|
1,692 | |||||||
Total
|
$ | 3,906 | 846 | |||||
Less:
amount representing interest
|
34 | |||||||
Long-term
obligation under capital lease
|
$ | 812 |
December
31,
|
2007
|
2006
|
||||||||||||||
(In
thousands)
|
Fixed
Rate
|
Variable
Rate
|
Fixed
Rate
|
Variable
Rate
|
||||||||||||
Commitments
to extend credit
|
$ | 75,053 | $ | 158,445 | $ | 84,590 | $ | 132,695 | ||||||||
Standby
letters of credit
|
14,982 | 3,355 | 15,102 | 1,761 | ||||||||||||
Total
|
$ | 90,035 | $ | 161,800 | $ | 99,692 | $ | 134,456 |
17.
Loss Contingencies
|
To
Be Well Capitalized
|
||||||||||||||||||
For
Capital
|
Under
Prompt Corrective
|
|||||||||||||||||
Actual
|
Adequacy
Purposes
|
Action
Provisions
|
||||||||||||||||
December
31, 2007 (Dollars in thousands)
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||
Tier
1 Capital (to Risk-Weighted Assets)
|
||||||||||||||||||
Consolidated
|
$ | 157,146 | 11.55 | % | $ | 54,405 | 4.00 | % | N/A | N/A | ||||||||
Farmers
Bank & Capital Trust Co.
|
34,058 | 9.90 | 13,764 | 4.00 | $ | 20,646 | 6.00 | % | ||||||||||
Farmers
Bank and Trust Company
|
25,337 | 9.46 | 10,711 | 4.00 | 16,066 | 6.00 | ||||||||||||
The
Lawrenceburg Bank & Trust Co.
|
11,211 | 9.30 | 4,820 | 4.00 | 7,230 | 6.00 | ||||||||||||
First
Citizens Bank
|
16,929 | 10.01 | 6,767 | 4.00 | 10,151 | 6.00 | ||||||||||||
United
Bank & Trust Co.
|
12,703 | 9.24 | 5,500 | 4.00 | 8,250 | 6.00 | ||||||||||||
Citizens
Bank of Jessamine County
|
12,572 | 9.59 | 5,241 | 4.00 | 7,862 | 6.00 | ||||||||||||
Citizens
Bank of Northern Kentucky
|
17,891 | 9.86 | 7,256 | 4.00 | 10,884 | 6.00 | ||||||||||||
Total
Capital (to Risk-Weighted Assets)
|
||||||||||||||||||
Consolidated
|
$ | 171,362 | 12.60 | % | $ | 108,809 | 8.00 | % | N/A | N/A | ||||||||
Farmers
Bank & Capital Trust Co.
|
38,342 | 11.14 | 27,528 | 8.00 | $ | 34,410 | 10.00 | % | ||||||||||
Farmers
Bank and Trust Company
|
28,213 | 10.54 | 21,421 | 8.00 | 26,776 | 10.00 | ||||||||||||
The
Lawrenceburg Bank & Trust Co.
|
12,570 | 10.43 | 9,640 | 8.00 | 12,050 | 10.00 | ||||||||||||
First
Citizens Bank
|
18,334 | 10.84 | 13,534 | 8.00 | 16,918 | 10.00 | ||||||||||||
United
Bank & Trust Co.
|
14,198 | 10.33 | 11,000 | 8.00 | 13,750 | 10.00 | ||||||||||||
Citizens
Bank of Jessamine County
|
13,913 | 10.62 | 10,482 | 8.00 | 13,103 | 10.00 | ||||||||||||
Citizens
Bank of Northern Kentucky
|
19,347 | 10.67 | 14,512 | 8.00 | 18,140 | 10.00 | ||||||||||||
Tier
1 Capital (to Average Assets)
|
||||||||||||||||||
Consolidated
|
$ | 157,146 | 8.08 | % | $ | 77,828 | 4.00 | % | N/A | N/A | ||||||||
Farmers
Bank & Capital Trust Co.
|
34,058 | 5.56 | 24,511 | 4.00 | $ | 30,639 | 5.00 | % | ||||||||||
Farmers
Bank and Trust Company
|
25,337 | 7.43 | 13,641 | 4.00 | 17,051 | 5.00 | ||||||||||||
The
Lawrenceburg Bank & Trust Co.
|
11,211 | 5.87 | 7,635 | 4.00 | 9,544 | 5.00 | ||||||||||||
First
Citizens Bank
|
16,929 | 7.09 | 9,548 | 4.00 | 11,934 | 5.00 | ||||||||||||
United
Bank & Trust Co.
|
12,703 | 6.18 | 8,217 | 4.00 | 10,272 | 5.00 | ||||||||||||
Citizens
Bank of Jessamine County
|
12,572 | 6.85 | 7,339 | 4.00 | 9,174 | 5.00 | ||||||||||||
Citizens
Bank of Northern Kentucky
|
17,891 | 7.98 | 8,964 | 4.00 | 11,205 | 5.00 |
To
Be Well Capitalized
|
||||||||||||||||||
For
Capital
|
Under
Prompt Corrective
|
|||||||||||||||||
Actual
|
Adequacy
Purposes
|
Action
Provisions
|
||||||||||||||||
December
31, 2006 (Dollars in thousands)
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||
Tier
1 Capital (to Risk-Weighted Assets)
|
||||||||||||||||||
Consolidated
|
$ | 155,264 | 12.23 | % | $ | 50,793 | 4.00 | % | N/A | N/A | ||||||||
Farmers
Bank & Capital Trust Co.
|
38,411 | 10.94 | 14,046 | 4.00 | $ | 21,069 | 6.00 | % | ||||||||||
Farmers
Bank and Trust Company
|
26,975 | 11.04 | 9,771 | 4.00 | 14,656 | 6.00 | ||||||||||||
The
Lawrenceburg Bank & Trust Co.
|
11,888 | 10.78 | 4,413 | 4.00 | 6,619 | 6.00 | ||||||||||||
First
Citizens Bank
|
18,072 | 11.62 | 6,223 | 4.00 | 9,335 | 6.00 | ||||||||||||
United
Bank & Trust Co.
|
14,084 | 11.19 | 5,034 | 4.00 | 7,552 | 6.00 | ||||||||||||
Citizens
Bank of Jessamine County
|
11,429 | 9.50 | 4,813 | 4.00 | 7,220 | 6.00 | ||||||||||||
Citizens
Bank of Northern Kentucky
|
17,345 | 10.05 | 6,902 | 4.00 | 10,353 | 6.00 | ||||||||||||
Total
Capital (to Risk-Weighted Assets)
|
||||||||||||||||||
Consolidated
|
$ | 167,263 | 13.17 | % | $ | 101,587 | 8.00 | % | N/A | N/A | ||||||||
Farmers
Bank & Capital Trust Co.
|
41,931 | 11.94 | 28,092 | 8.00 | $ | 35,115 | 10.00 | % | ||||||||||
Farmers
Bank and Trust Company
|
28,839 | 11.81 | 19,541 | 8.00 | 24,427 | 10.00 | ||||||||||||
The
Lawrenceburg Bank & Trust Co.
|
13,269 | 12.03 | 8,825 | 8.00 | 11,032 | 10.00 | ||||||||||||
First
Citizens Bank
|
19,341 | 12.43 | 12,447 | 8.00 | 15,559 | 10.00 | ||||||||||||
United
Bank & Trust Co.
|
15,332 | 12.18 | 10,069 | 8.00 | 12,586 | 10.00 | ||||||||||||
Citizens
Bank of Jessamine County
|
12,673 | 10.53 | 9,626 | 8.00 | 12,033 | 10.00 | ||||||||||||
Citizens
Bank of Northern Kentucky
|
18,657 | 10.81 | 13,804 | 8.00 | 17,255 | 10.00 | ||||||||||||
Tier
1 Capital (to Average Assets)
|
||||||||||||||||||
Consolidated
|
$ | 155,264 | 8.47 | % | $ | 73,314 | 4.00 | % | N/A | N/A | ||||||||
Farmers
Bank & Capital Trust Co.
|
38,411 | 6.55 | 23,449 | 4.00 | $ | 29,312 | 5.00 | % | ||||||||||
Farmers
Bank and Trust Company
|
26,975 | 8.05 | 13,406 | 4.00 | 16,757 | 5.00 | ||||||||||||
The
Lawrenceburg Bank & Trust Co.
|
11,888 | 6.86 | 6,935 | 4.00 | 8,669 | 5.00 | ||||||||||||
First
Citizens Bank
|
18,072 | 8.41 | 8,594 | 4.00 | 10,743 | 5.00 | ||||||||||||
United
Bank & Trust Co.
|
14,084 | 7.90 | 7,128 | 4.00 | 8,910 | 5.00 | ||||||||||||
Citizens
Bank of Jessamine County
|
11,429 | 7.61 | 6,005 | 4.00 | 7,507 | 5.00 | ||||||||||||
Citizens
Bank of Northern Kentucky
|
17,345 | 8.17 | 8,489 | 4.00 | 10,611 | 5.00 |
December
31,
|
2007
|
2006
|
||||||||||||||
Carrying
|
Fair
|
Carrying
|
Fair
|
|||||||||||||
(In
thousands)
|
Amount
|
Value
|
Amount
|
Value
|
||||||||||||
Assets
|
||||||||||||||||
Cash
and cash equivalents
|
$ | 79,140 | $ | 79,140 | $ | 156,828 | $ | 156,828 | ||||||||
Investment
securities:
|
||||||||||||||||
Available
for sale
|
542,633 | 542,633 | 326,485 | 326,485 | ||||||||||||
Held
to maturity
|
3,844 | 3,863 | 7,788 | 7,849 | ||||||||||||
Loans,
net
|
1,277,769 | 1,275,746 | 1,185,837 | 1,161,656 | ||||||||||||
Accrued
interest receivable
|
13,337 | 13,337 | 11,735 | 11,735 | ||||||||||||
Liabilities
|
||||||||||||||||
Deposits
|
1,474,097 | 1,475,010 | 1,454,820 | 1,452,129 | ||||||||||||
Federal
funds purchased and other short-term borrowings
|
80,755 | 80,755 | 76,718 | 76,718 | ||||||||||||
Securities
sold under agreements to repurchase and other long-term
borrowings
|
267,339 | 272,396 | 62,218 | 71,019 | ||||||||||||
Subordinated
notes payable to unconsolidated trusts
|
48,970 | 37,857 | 25,774 | 25,774 | ||||||||||||
Accrued
interest payable
|
6,445 | 6,445 | 4,773 | 4,773 |
December
31, (In thousands)
|
2007
|
2006 | 1 | |||||
Assets
|
||||||||
Cash
on deposit with subsidiaries
|
$ | 14,974 | $ | 11,103 | ||||
Investment
in subsidiaries
|
197,422 | 191,109 | ||||||
Other
assets
|
11,115 | 11,625 | ||||||
Total
assets
|
$ | 223,511 | $ | 213,837 | ||||
Liabilities
|
||||||||
Dividends
payable
|
$ | 2,436 | $ | 3,472 | ||||
Subordinated
notes payable to unconsolidated trusts
|
48,970 | 25,774 | ||||||
Other
liabilities
|
3,614 | 7,528 | ||||||
Total
liabilities
|
55,020 | 36,774 | ||||||
Shareholders’
Equity
|
||||||||
Common
stock
|
923 | 988 | ||||||
Capital
surplus
|
48,176 | 53,201 | ||||||
Retained
earnings
|
122,498 | 128,652 | ||||||
Accumulated
other comprehensive loss
|
(3,106 | ) | (5,778 | ) | ||||
Total
shareholders’ equity
|
168,491 | 177,063 | ||||||
Total
liabilities and shareholders’ equity
|
$ | 223,511 | $ | 213,837 |
|
1Certain
amounts have been revised related to the Company’s postretirement benefits
plans and equity accounts. Please refer to Note 1 under the captions “Revised 2006 Balance Sheet and Statement of Changes in
Shareholders’ Equity” and “Treasury
Stock”.
|
Years
Ended December 31, (In thousands)
|
2007
|
2006
|
2005
|
|||||||||
Income
|
||||||||||||
Dividends
from subsidiaries
|
$ | 22,616 | $ | 9,086 | $ | 7,490 | ||||||
Interest
income
|
64 | 74 | 85 | |||||||||
Gain
on sale of discontinued operations
|
9,442 | |||||||||||
Other
noninterest income
|
3,170 | 2,732 | 2,110 | |||||||||
Total
income
|
25,850 | 21,334 | 9,685 | |||||||||
Expense
|
||||||||||||
Interest
expense-subordinated notes payable to unconsolidated
trusts
|
2,394 | 1,747 | 623 | |||||||||
Interest
expense on other borrowed funds
|
20 | 186 | ||||||||||
Noninterest
expense
|
4,391 | 4,021 | 3,290 | |||||||||
Total
expense
|
6,805 | 5,954 | 3,913 | |||||||||
Income
before income tax benefit and equity in undistributed income of
subsidiaries
|
19,045 | 15,380 | 5,772 | |||||||||
Income
tax (benefit) expense
|
(1,375 | ) | 2,321 | (772 | ) | |||||||
Income
before equity in undistributed income of subsidiaries
|
20,420 | 13,059 | 6,544 | |||||||||
Equity
in undistributed income of subsidiaries1
|
(4,793 | ) | 8,313 | 9,228 | ||||||||
Net
income
|
$ | 15,627 | $ | 21,372 | $ | 15,772 |
Years
Ended December 31, (In thousands)
|
2007
|
2006
|
2005
|
|||||||||
Cash
Flows From Operating Activities
|
||||||||||||
Net
income
|
$ | 15,627 | $ | 21,372 | $ | 15,772 | ||||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||||
Gain
on sale of discontinued operations
|
(9,442 | ) | ||||||||||
Equity
in undistributed income of subsidiaries
|
4,793 | (8,313 | ) | (9,228 | ) | |||||||
Noncash
stock option expense
|
13 | 52 | ||||||||||
Change
in other assets and liabilities, net
|
(3,767 | ) | 3,925 | (793 | ) | |||||||
Deferred
income tax expense (benefit)
|
555 | (742 | ) | 8 | ||||||||
Net
cash provided by operating activities
|
17,221 | 6,852 | 5,759 | |||||||||
Cash
Flows From Investing Activities
|
||||||||||||
Proceeds
from disposal of discontinued operations
|
19,875 | |||||||||||
Investment
in unconsolidated trusts
|
(629 | ) | (774 | ) | ||||||||
Investment
in nonbank subsidiaries
|
(285 | ) | ||||||||||
Investment
in bank subsidiary
|
(8,000 | ) | (629 | ) | (581 | ) | ||||||
Payment
of prior year accrued purchase price-Citizens Bancorp,
Inc.
|
(21,846 | ) | ||||||||||
Purchase
of Citizens National Bancshares, Inc.
|
(15,041 | ) | ||||||||||
Purchase
price refinements of previous acquisitions
|
50 | (29 | ) | (2 | ) | |||||||
Purchase
of company-owned life insurance
|
(1,579 | ) | ||||||||||
Net
cash used in investing activities
|
(8,579 | ) | (19,249 | ) | (1,642 | ) | ||||||
Cash
Flows From Financing Activities
|
||||||||||||
Proceeds
from short-term borrowings
|
2,500 | 15,000 | ||||||||||
Repayment
of short-term borrowings
|
(2,500 | ) | (15,000 | ) | ||||||||
Dividends
paid
|
(11,118 | ) | (9,553 | ) | (8,949 | ) | ||||||
Purchase
of common stock
|
(18,649 | ) | (820 | ) | (571 | ) | ||||||
Shares
issued under Employee Stock Purchase Plan
|
254 | 223 | 187 | |||||||||
Stock
options exercised
|
1,546 | 1,529 | 771 | |||||||||
Proceeds
from long-term debt issued to unconsolidated trusts
|
23,196 | 25,774 | ||||||||||
Net
cash (used in) provided by financing activities
|
(4,771 | ) | (8,621 | ) | 17,212 | |||||||
Net
increase (decrease) in cash and cash equivalents
|
3,871 | (21,018 | ) | 21,329 | ||||||||
Cash
and cash equivalents at beginning of year
|
11,103 | 32,121 | 10,792 | |||||||||
Cash
and cash equivalents at end of year
|
$ | 14,974 | $ | 11,103 | $ | 32,121 |
21.
Quarterly Financial Data
(Unaudited)
|
(In
thousands, except per share data)
|
||||||||||||||||
Quarters
Ended 2007
|
March
31
|
June
30
|
Sept.
30
|
Dec.
313
|
||||||||||||
Interest
income
|
$ | 27,402 | $ | 28,511 | $ | 28,494 | $ | 29,850 | ||||||||
Interest
expense
|
13,307 | 13,661 | 13,872 | 15,199 | ||||||||||||
Net
interest income
|
14,095 | 14,850 | 14,622 | 14,651 | ||||||||||||
Provision
for loan losses
|
(496 | ) | 330 | 595 | 3,209 | |||||||||||
Net
interest income after provision for loan losses
|
14,591 | 14,520 | 14,027 | 11,442 | ||||||||||||
Noninterest
income
|
5,667 | 6,108 | 6,119 | 6,263 | ||||||||||||
Noninterest
expense
|
14,338 | 14,309 | 14,356 | 15,820 | ||||||||||||
Income
before income taxes
|
5,920 | 6,319 | 5,790 | 1,885 | ||||||||||||
Income
tax expense
|
1,310 | 1,407 | 1,633 | (63 | ) | |||||||||||
Net
income
|
$ | 4,610 | $ | 4,912 | $ | 4,157 | $ | 1,948 | ||||||||
Net
income per common share – basic and diluted
|
$ | .58 | $ | .62 | $ | .54 | $ | .26 | ||||||||
Weighted
average shares outstanding, basic
|
7,893 | 7,884 | 7,672 | 7,382 | ||||||||||||
Weighted
average shares outstanding, diluted
|
7,908 | 7,892 | 7,672 | 7,382 |
(In
thousands, except per share data)
|
||||||||||||||||
Quarters
Ended 2006
|
March
31
|
June
30
|
Sept.
30
|
Dec.
31
|
||||||||||||
Interest
income
|
$ | 20,883 | $ | 21,669 | $ | 22,835 | $ | 26,953 | ||||||||
Interest
expense
|
8,567 | 9,427 | 10,447 | 12,991 | ||||||||||||
Net
interest income
|
12,316 | 12,242 | 12,388 | 13,962 | ||||||||||||
Provision
for loan losses
|
(34 | ) | (46 | ) | 253 | 792 | ||||||||||
Net
interest income after provision for loan losses
|
12,350 | 12,288 | 12,135 | 13,170 | ||||||||||||
Noninterest
income
|
5,056 | 4,991 | 5,015 | 5,397 | ||||||||||||
Noninterest
expense
|
12,507 | 12,434 | 12,901 | 15,535 | ||||||||||||
Income
from continuing operations before income taxes
|
4,899 | 4,845 | 4,249 | 3,032 | ||||||||||||
Income
tax expense from continuing operations
|
910 | 967 | 966 | 517 | ||||||||||||
Income
from continuing operations
|
3,989 | 3,878 | 3,283 | 2,515 | ||||||||||||
Income
from discontinued operations before income taxes1
|
567 | 599 | 713 | 9,963 | ||||||||||||
Income
tax expense from discontinued operations2
|
165 | 171 | 250 | 3,549 | ||||||||||||
Income
from discontinued operations
|
402 | 428 | 463 | 6,414 | ||||||||||||
Net
income
|
$ | 4,391 | $ | 4,306 | $ | 3,746 | $ | 8,929 | ||||||||
Income
from continuing operations – basic and diluted
|
$ | .54 | $ | .52 | $ | .45 | $ | .32 | ||||||||
Income
from discontinued operations – basic and diluted
|
.05 | .06 | .06 | .81 | ||||||||||||
Net
income per common share, basic and diluted
|
.59 | .58 | .51 | 1.13 | ||||||||||||
Weighted
average shares outstanding, basic
|
7,385 | 7,378 | 7,393 | 7,884 | ||||||||||||
Weighted
average shares outstanding, diluted
|
7,413 | 7,400 | 7,412 | 7,904 |
(In
thousands)
|
January
12, 2007
|
|||
Assets
|
||||
Cash
|
$ | 10,870 | ||
Customer
list intangible
|
1,275 | |||
Core
deposit intangible
|
1,874 | |||
Goodwill
|
9,663 | |||
Total
Assets
|
$ | 23,682 | ||
Liabilities
|
||||
Deposits
|
$ | 10,870 | ||
Net
Assets Acquired
|
$ | 12,812 | ||
(In
thousands)
|
2007
|
2006
|
||||||
Beginning
of year
|
$ | 42,822 | $ | 28,437 | ||||
Purchase
price refinements of prior years’ acquisitions
|
(77 | ) | 211 | |||||
Acquired
goodwill
|
9,663 | 14,174 | ||||||
End
of year
|
$ | 52,408 | $ | 42,822 |
2007
|
2006
|
|||||||||||||||
Amortized
Intangible Assets
(In
thousands)
|
Gross
Amount
|
Accumulated
Amortization
|
Gross
Amount
|
Accumulated
Amortization
|
||||||||||||
Core
deposit intangibles
|
$ | 12,765 | $ | 5,274 | $ | 10,890 | $ | 2,541 | ||||||||
Other
customer relationship intangibles
|
3,689 | 1,637 | 2,414 | 1,008 | ||||||||||||
Total
|
$ | 16,454 | $ | 6,911 | $ | 13,304 | $ | 3,549 |
(In
thousands)
|
Amount
|
|||
2008
|
$ | 2,602 | ||
2009
|
1,952 | |||
2010
|
1,437 | |||
2011
|
1,143 | |||
2012
|
1,014 |
|
·
|
Pertain
to the maintenance of records that in reasonable detail accurately and
fairly reflect the transactions and dispositions of Company
assets;
|
|
·
|
Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that Company’s receipts and expenditures are
being made only in accordance with the authorization of Company’s
management and members of the Company’s Board of Directors;
and
|
|
·
|
Provide
reasonable assurance regarding prevention or timely detection of
unauthorized acquisitions, uses or dispositions of Company assets that
could have a material effect on the Company’s financial
statements.
|
Positions
and
|
Years
of Service
|
||
Offices
With
|
With
the
|
||
Executive
Officer1
|
Age
|
the
Registrant
|
Registrant
|
G.
Anthony Busseni
|
59
|
President
and CEO, Director2
|
23*
|
Allison
B. Gordon
|
44
|
Senior
Vice President3
|
21*
|
*
|
Includes
years of service with the Company and its
subsidiaries.
|
1
|
For
Regulation O purposes, Frank W. Sower, Jr., Chairman of the Company’s
board of directors, is considered an executive officer in name
only.
|
2
|
Also
a director of Farmers Bank, Citizens Jessamine, Farmers Georgetown, United
Bank, The Lawrenceburg Bank and Trust, First Citizens, Citizens Northern,
FCB Services, Farmers Insurance (Chairman), Leasing One (Chairman),
Kentucky General (Chairman), FFKT Insurance, Kentucky Home Life Insurance
Company, and an administrative trustee of Farmers Capital Bank Trust I,
Farmers Capital Bank Trust II, and Farmers Capital Bank Trust
III.
|
3
|
Also
a director of Farmers Bank, Farmers Georgetown, FCB Services, and an
administrative trustee of Farmers Capital Bank Trust I, Farmers Capital
Bank Trust II, and Farmers Capital Bank Trust
III.
|
(a)1.
|
Financial
Statements
|
(a)2.
|
Financial Statement
Schedules
|
(a)3.
|
Exhibits:
|
|
3.1
|
Amended
and Restated Articles of Incorporation of the Registrant (incorporated by
reference to Quarterly Report on Form 10-Q for the quarterly period ended
June 30, 2006).
|
|
3.2
|
Amended
and Restated Bylaws of the Registrant (incorporated by reference to Annual
Report of Form 10-K for the fiscal year ended December 31,
1997).
|
|
3.3
|
Amendments
to Bylaws of the Registrant (incorporated by reference to Quarterly Report
of Form 10-Q for the quarterly period ended March 31,
2003).
|
|
4
|
Articles
of Incorporation and Bylaws of the Registrant (incorporated by reference
to Quarterly Report on Form 10-Q for the quarterly period ended June 30,
2006, the Annual Report on Form 10-K for the fiscal year ended December
31, 1997, and the Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 2003).
|
FARMERS
CAPITAL BANK CORPORATION
|
|||
By:
|
/s/ G. Anthony Busseni
|
||
G.
Anthony Busseni
|
|||
President
and Chief Executive Officer
|
|||
Date:
|
March
7, 2008
|
/s/
G. Anthony Busseni
|
President,
Chief Executive Officer
|
March
7, 2008
|
G.
Anthony Busseni
|
and
Director (principal executive
|
|
officer
of the Registrant)
|
||
/s/ Frank W. Sower,
Jr.
|
Chairman
|
February
25,2008
|
Frank
W. Sower, Jr.
|
||
/s/
Frank R. Hamilton, Jr
|
Director
|
February 27, 2008
|
Frank
R. Hamilton, Jr.
|
||
/s/
Lloyd C. Hillard, Jr.
|
Director
|
February
25, 2008
|
Lloyd
C. Hillard, Jr.
|
||
/s/
R. Terry Bennett
|
Director
|
March 5, 2008
|
R.
Terry Bennett
|
||
/s/
Shelley S. Sweeney
|
Director
|
March 3, 2008
|
Shelley
S. Sweeney
|
||
/s/
Dr. Donald J. Mullineaux
|
Director
|
February 27, 2008
|
Dr.
Donald J. Mullineaux
|
||
/s/
Dr. Donald A. Saelinger
|
Director
|
February
24, 2008
|
Dr.
Donald A. Saelinger
|
||
Director
|
||
Dr.
John D. Sutterlin
|
||
/s/
Michael M. Sullivan
|
Director
|
February
27, 2008
|
Michael
M. Sullivan
|
||
/s/
J. Barry Banker
|
Director
|
February
25, 2008
|
J.
Barry Banker
|
||
/s/
Robert Roach, Jr.
|
Director
|
February
26, 2008
|
Robert
Roach, Jr.
|
||
/s/
C. Douglas Carpenter
|
Senior
Vice President, Secretary
|
March
10, 2008
|
C.
Douglas Carpenter
|
and
CFO (principal financial and
|
|
accounting
officer)
|
Exhibit
|
Page
|
|
21
|
83
|
|
23
|
84
|
|
31.1
|
85
|
|
31.2
|
86
|
|
32
|
87
|