Advertisement

Topics

Park National Corporation Reports Second Quarter 2015 Financial Results and Declares Quarterly Dividend

20:00 EDT 26 Jul 2015 | Globe Newswire

NEWARK, Ohio, July 27, 2015 (GLOBE NEWSWIRE) -- Park National Corporation (Park) (NYSE MKT:PRK) today announced financial results for the second quarter and first half of 2015, which included loan growth in all loan categories. The board of directors also declared a quarterly cash dividend of $0.94 per common share, payable on September 10, 2015 to common shareholders of record as of August 21, 2015.

Park’s net income for the three months ended June 30, 2015 (second quarter) was $21.0 million, compared to $21.8 million for the same period in 2014, a decrease of $0.8 million or 3.5 percent. Net income per diluted common share for the second quarter of 2015 was $1.37, compared to $1.42 in the same period of 2014. Net income for the six months ended June 30, 2015 (first half) was $40.1 million, compared to $41.4 million for the same period in 2014, a decrease of $1.3 million or 3.2 percent. Net income per diluted common share for the first half of 2015 was $2.60, compared to $2.69 in the same period of 2014.

Park’s community-banking subsidiary, The Park National Bank, reported net income of $40.5 million for the six-months ended June 30, 2015, compared to net income of $41.7 million for the same period of 2014. The Park National Bank had total assets of $7.2 billion at June 30, 2015 and $6.7 billion at June 30, 2014. This performance generated an annualized return on average assets of 1.14 percent and 1.26 percent for the bank for first half periods of 2015 and 2014, respectively.

The Park National Bank loan portfolio expanded during the second quarter of 2015. Loans outstanding at June 30, 2015 were $4.86 billion, compared to $4.79 billion at March 31, 2015, an increase of $73 million or an annualized 6.15 percent. The bank reported growth in the second quarter across all loan categories: mortgage loan growth of $13 million (4.4 percent annualized), commercial loan growth of $23 million (3.8 percent annualized) and consumer loan growth of $37 million (16.4 percent annualized).

“We remain energized by business owners and individuals who value excellent service, which is what they receive from their Park affiliate bankers. Our local lenders stand ready to help anyone who wants practical and creative banking solutions,” said Park Chief Executive Officer David L. Trautman.

About Park National Corporation

Headquartered in Newark, Ohio, Park National Corporation had $7.3 billion in total assets (as of June 30, 2015). The Park organization principally consists of 11 community bank divisions, a non-bank subsidiary and two specialty finance companies. Park's Ohio-based banking operations are conducted through Park subsidiary The Park National Bank and its divisions, which include Fairfield National Bank Division, Richland Bank Division, Century National Bank Division, First-Knox National Bank Division, Farmers Bank Division, United Bank, N.A. Division, Second National Bank Division, Security National Bank Division, Unity National Bank Division, and The Park National Bank of Southwest Ohio & Northern Kentucky Division; and Scope Leasing, Inc. (d.b.a. Scope Aircraft Finance). The Park organization also includes Guardian Financial Services Company (d.b.a. Guardian Finance Company) and SE Property Holdings, LLC.

Complete financial tables are listed below…

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

Park cautions that any forward-looking statements contained in this Current Report on Form 8-K or made by management of Park are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance.  The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties.  Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements.  Risks and uncertainties that could cause actual results to differ materially include, without limitation: Park's ability to execute our business plan successfully and within the expected timeframe; general economic and financial market conditions, specifically in the real estate markets and the credit markets, either nationally or in the states in which Park and our subsidiaries do business, may experience a slowing or reversal of the current economic expansion in addition to continuing residual effects of recessionary conditions and an uneven spread of positive impacts of recovery on the economy and our counterparties, including adverse impacts on demand for loan, deposit and other financial services, delinquencies, defaults and counterparty ability to meet credit and other obligations; changes in interest rates and prices may adversely impact the value of securities, loans, deposits and other financial instruments and the interest rate sensitivity of our consolidated balance sheet as well as reduce interest margins; changes in consumer spending, borrowing and saving habits, whether due to changing business and economic conditions, legislative and regulatory initiatives, or other factors; changes in customers', suppliers', and other counterparties' performance and creditworthiness; asset/liability repricing risks and liquidity risks; our liquidity requirements could be adversely affected by changes to regulations governing bank and bank holding company capital and liquidity standards as well as by changes in our assets and liabilities; competitive factors among financial services organizations could increase significantly, including product and pricing pressures, changes to third-party relationships and our ability to attract, develop and retain qualified bank professionals; clients could pursue alternatives to bank deposits, causing us to lose a relatively inexpensive source of funding; the nature, timing and effect of changes in banking regulations or other regulatory or legislative requirements affecting the respective businesses of Park and our subsidiaries, including changes in laws and regulations concerning taxes, pensions, bankruptcy, consumer protection, accounting, banking, securities and other aspects of the financial services industry, specifically the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), as well as future regulations which will be adopted by the relevant regulatory agencies, including the Consumer Financial Protection Bureau, to implement the Dodd-Frank Act's provisions, the Budget Control Act of 2011, the American Taxpayer Relief Act of 2012 and the Basel III regulatory capital reforms; the effect of changes in accounting policies and practices, as may be adopted by the Financial Accounting Standards Board, the SEC, the Public Company Accounting Oversight Board and other regulatory agencies, and the accuracy of our assumptions and estimates used to prepare our financial statements; the effect of trade, monetary, fiscal and other governmental policies of the U.S. federal government, including money supply and interest rate policies of the Federal Reserve; disruption in the liquidity and other functioning of U.S. financial markets; the impact on financial markets and the economy of any changes in the credit ratings of the U.S. Treasury obligations and other U.S. government-backed debt, as well as issues surrounding the levels of U.S., European and Asian government debt and concerns regarding the creditworthiness of certain sovereign governments, supranationals and financial institutions in Europe; unfavorable resolution of legal proceedings or other claims and regulatory and other governmental examinations or other inquiries; the adequacy of our risk management program; the ability to secure confidential information and deliver products and services through the use of computer systems and telecommunications networks; a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors and other service providers, including as a result of cyber attacks; demand for loans in the respective market areas served by Park and our subsidiaries; and other risk factors relating to the banking industry as detailed from time to time in Park's reports filed with the SEC including those described in "Item 1A. Risk Factors" of Part I of Park's Annual Report on Form 10-K for the fiscal year ended December 31, 2014. Park does not undertake, and specifically disclaims any obligation, to publicly release the results of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement was made, or reflect the occurrence of unanticipated events, except to the extent required by law.

PARK NATIONAL CORPORATION
Financial Highlights
Three months ended June 30, 2015, March 31, 2015, and June 30, 2014
      
  2015  2015  2014 Percent change vs.
(in thousands, except share and per share data)2nd QTR1st QTR2nd QTR1Q '152Q '14
INCOME STATEMENT:     
Net interest income$  56,515 $  55,535 $  56,561  1.8% (0.1)%
Provision for (recovery of) loan losses 1,612  1,632  (1,260)N.M.N.M.
Other income 19,191  18,873  19,671  1.7% (2.4)%
Other expense 44,667  45,720  46,241  (2.3)% (3.4)%
Income before income taxes$  29,427 $  27,056 $  31,251  8.8% (5.8)%
Income taxes 8,388  8,012  9,441  4.7% (11.2)%
Net income$  21,039 $  19,044 $  21,810  10.5% (3.5)%
      
MARKET DATA:     
Earnings per common share - basic (b)$  1.37 $  1.24 $  1.42  10.5% (3.5)%
Earnings per common share - diluted (b) 1.37  1.23  1.42  11.4% (3.5)%
Cash dividends per common share 0.94  0.94  0.94 —%—%
Book value per common share at period end 45.93  46.02  44.50  (0.2)% 3.2%
Stock price per common share at period end 87.37  85.56  77.20  2.1% 13.2%
Market capitalization at period end 1,342,954  1,315,133  1,188,295  2.1% 13.0%
      
Weighted average common shares - basic (a) 15,370,882  15,379,170  15,392,435  (0.1)% (0.1)%
Weighted average common shares - diluted (a) 15,407,881  15,421,928  15,412,167  (0.1)%—%
Common shares outstanding at period end 15,370,877  15,370,887  15,392,425 —% (0.1)%
      
PERFORMANCE RATIOS: (annualized)     
Return on average assets (a)(b) 1.16% 1.07% 1.29% 8.4% (10.1)%
Return on average equity (a)(b) 11.90% 10.95% 12.96% 8.7% (8.2)%
Yield on loans 4.68% 4.68% 4.91%—% (4.7)%
Yield on investments 2.49% 2.57% 2.60% (3.1)% (4.2)%
Yield on money markets 0.25% 0.25% 0.25%—%—%
Yield on earning assets 3.96% 3.98% 4.28% (0.5)% (7.5)%
Cost of interest bearing deposits 0.30% 0.31% 0.27% (3.2)% 11.1%
Cost of borrowings 2.46% 2.34% 2.60% 5.1% (5.4)%
Cost of paying liabilities 0.72% 0.74% 0.81% (2.7)% (11.1)%
Net interest margin (g) 3.40% 3.40% 3.65%—% (6.8)%
Efficiency ratio (g) 58.87% 61.31% 60.48% (4.0)% (2.7)%
      
OTHER RATIOS (NON - GAAP):     
Annualized return on average tangible assets (a)(b)(e) 1.17% 1.08% 1.31% 8.3% (10.7)%
Annualized return on average tangible equity (a)(b)(c) 13.25% 12.21% 14.51% 8.5% (8.7)%
Tangible book value per share (d)$  41.22 $  41.32 $  39.80  (0.2)% 3.6%
      
N.M. - Not meaningful     
Note: Explanations (a) - (g) are included at the end of the financial highlights.     

 

PARK NATIONAL CORPORATION
Financial Highlights (continued)
Three months ended June 30, 2015, March 31, 2015, and June 30, 2014
      
    Percent change vs.
BALANCE SHEET:June 30, 2015March 31, 2015June 30, 20141Q '152Q '14
      
Investment securities$  1,550,103 $  1,457,171 $  1,417,910  6.4 9.3
Loans 4,900,974  4,830,830  4,735,487  1.5 3.5
Allowance for loan losses 57,427  55,408  57,911  3.6 (0.8)%
Goodwill and other intangibles 72,334  72,334  72,334 —%—%
Other real estate owned 21,876  26,337  23,909  (16.9)% (8.5)%
Total assets 7,309,569  7,303,999  6,787,190  0.1 7.7
Total deposits 5,512,366  5,515,847  4,927,211  (0.1)% 11.9
Borrowings 1,018,680  1,018,516  1,118,404 —% (8.9)%
Shareholders' equity 705,963  707,431  684,988  (0.2)% 3.1
Tangible equity (d) 633,629  635,097  612,654  (0.2)% 3.4
Nonperforming loans 113,795  114,304  142,902  (0.4)% (20.4)%
Nonperforming assets 135,671  140,641  166,811  (3.5)% (18.7)%
      
ASSET QUALITY RATIOS:     
Loans as a % of period end assets 67.05 66.14 69.77 1.4 (3.9)%
Nonperforming loans as a % of period end loans 2.32 2.37 3.02 (2.1)% (23.2)%
Nonperforming assets as a % of period end loans + OREO 2.76 2.90 3.50 (4.8)% (21.1)%
Allowance for loan losses as a % of period end loans 1.17 1.15 1.22 1.7 (4.1)%
Net loan (recoveries) charge-offs$ (407 )$  576 $  1,086 N.M.N.M.
Annualized net loan (recoveries) charge-offs as a % of average loans (a) (0.03)%  0.05 0.09N.M.N.M.
      
CAPITAL & LIQUIDITY:     
Total equity / Period end assets 9.66 9.69 10.09 (0.3)% (4.3)%
Tangible equity (d) / Tangible assets (f) 8.76 8.78 9.12 (0.2)% (3.9)%
Average equity / Average assets (a) 9.76 9.78 9.97 (0.2)% (2.1)%
Average equity / Average loans (a) 14.60 14.64 14.43 (0.3)% 1.2
Average loans / Average deposits (a) 88.80 90.34 95.12 (1.7)% (6.6)%
      
N.M. - Not meaningful     
Note: Explanations (a) - (g) are included at the end of the financial highlights.     

 

PARK NATIONAL CORPORATION
Financial Highlights
Six months ended June 30, 2015 and 2014
    
(in thousands, except share and per share data) 2015  2014 Percent change vs. 2014
INCOME STATEMENT:   
Net interest income$  112,050 $  111,041  0.9
Provision for (recovery of) loan losses 3,244  (3,485)N.M.
Other income 38,064  36,319  4.8
Total other expense 90,387  92,020  (1.8)%
Income before income taxes$  56,483 $  58,825  (4.0)%
Income taxes 16,400  17,438  (6.0)%
Net income$  40,083 $  41,387  (3.2)%
    
MARKET DATA:   
Earnings per common share - basic (b) 2.61  2.69  (3.0)%
Earnings per common share - diluted (b) 2.60  2.69  (3.3)%
Cash dividends per common share 1.88  1.88 —%
    
Weighted average common shares - basic (a) 15,375,026  15,396,770  (0.1)%
Weighted average common shares - diluted (a) 15,411,920  15,413,568 —%
    
PERFORMANCE RATIOS: (Annualized)   
Return on average assets (a)(b) 1.12 1.23 (8.9)%
Return on average common equity (a)(b) 11.43 12.50 (8.6)%
Yield on loans 4.68 4.87 (3.9)%
Yield on investments 2.53 2.63 (3.8)%
Yield on earning assets 3.97 4.24 (6.4)%
Cost of interest bearing deposits 0.30 0.28 7.1
Cost of borrowings 2.40 2.61 (8.0)%
Cost of paying liabilities 0.73 0.81 (9.9)%
Net interest margin (g) 3.40 3.60 (5.6)%
Efficiency ratio (g) 60.08 62.26 (3.5)%
    
ASSET QUALITY RATIOS:   
Net loan charge-offs (recoveries)$  169 $ (1,928 )N.M.
Annualized net loan charge-offs (recoveries) as a % of average loans (a) 0.01 (0.08)%N.M.
    
CAPITAL & LIQUIDITY:   
Average stockholders' equity / Average assets (a) 9.77 9.86 (0.9)%
Average stockholders' equity / Average loans (a) 14.62 14.38 1.7
Average loans / Average deposits (a) 89.56 94.34 (5.1)%
    
OTHER RATIOS (NON-GAAP):   
Annualized return on average tangible assets (a)(b)(e) 1.13 1.25 (9.6)%
Annualized return on average tangible common equity (a)(b)(c) 12.73 14.02 (9.2)%

 

PARK NATIONAL CORPORATION
Financial Highlights (continued)
      
(a) Averages are for the quarters and six months ended June 30, 2015, March 31, 2015 and June 30, 2014.
(b) Reported measure uses net income.
(c) Net income for each period divided by average tangible equity during the period. Average tangible equity equals average shareholders' equity during the applicable period less average goodwill and other intangibles during the applicable period.
      
RECONCILIATION OF AVERAGE SHAREHOLDERS' EQUITY TO AVERAGE TANGIBLE EQUITY:
 THREE MONTHS ENDEDSIX MONTHS ENDED
 June 30, 2015March 31, 2015June 30, 2014June 30, 2015June 30, 2014
AVERAGE SHAREHOLDERS' EQUITY$  709,031 $  705,041 $  675,243 $  707,047 $  667,564 
Less: Average goodwill and other intangibles 72,334  72,334  72,334  72,334  72,334 
AVERAGE TANGIBLE EQUITY$  636,697 $  632,707 $  602,909 $  634,713 $  595,230 
      
(d) Tangible book value divided by common shares outstanding at period end. Tangible equity equals ending shareholders' equity less goodwill and other intangibles, in each case at the end of the period.
      
RECONCILIATION OF SHAREHOLDERS' EQUITY TO TANGIBLE EQUITY:
 June 30, 2015March 31, 2015June 30, 2014  
SHAREHOLDERS' EQUITY$  705,963 $  707,431 $  684,988   
Less: Goodwill and other intangibles 72,334  72,334  72,334   
TANGIBLE EQUITY$  633,629 $  635,097 $  612,654   
      
(e) Net income for each period divided by average tangible assets during the period. Average tangible assets equals average assets less average goodwill and other intangibles, in each case during the applicable period.
      
RECONCILIATION OF AVERAGE ASSETS TO AVERAGE TANGIBLE ASSETS:
 THREE MONTHS ENDEDSIX MONTHS ENDED
 June 30, 2015March 31, 2015June 30, 2014June 30, 2015June 30, 2014
AVERAGE ASSETS$  7,265,755 $  7,209,143 $  6,772,407 $  7,237,605 $  6,768,636 
Less: Average goodwill and other intangibles 72,334  72,334  72,334  72,334  72,334 
AVERAGE TANGIBLE ASSETS$  7,193,421 $  7,136,809 $  6,700,073 $  7,165,271 $  6,696,302 
      
(f) Tangible equity divided by tangible assets. Tangible assets equals total assets less goodwill and other intangibles, in each case at the end of the period.
      
RECONCILIATION OF TOTAL ASSETS TO TANGIBLE ASSETS:
 June 30, 2015March 31, 2015June 30, 2014  
TOTAL ASSETS$  7,309,569 $  7,303,999 $  6,787,190   
Less: Goodwill and other intangibles 72,334  72,334  72,334   
TANGIBLE ASSETS$  7,237,235 $  7,231,665 $  6,714,856   
      
(g) Efficiency ratio is calculated by dividing total other expense by the sum of fully taxable equivalent net interest income and other income. Fully taxable equivalent net interest income reconciliation is shown below assuming a 35% tax rate. Additionally, net interest margin is calculated on a fully taxable equivalent basis.
      
RECONCILIATION OF FULLY TAXABLE EQUIVALENT NET INTEREST INCOME TO NET INTEREST INCOME
 THREE MONTHS ENDEDSIX MONTHS ENDED
 June 30, 2015March 31, 2015June 30, 2014June 30, 2015June 30, 2014
Interest income$  65,804 $  65,018 $  66,363 $  130,822 $  130,705 
Fully taxable equivalent adjustment 170  161  221  331  444 
Fully taxable equivalent interest income$  65,974 $  65,179 $  66,584 $  131,153 $  131,149 
Interest expense 9,289  9,483  9,802  18,772  19,664 
Fully taxable equivalent net interest income$  56,685 $  55,696 $  56,782 $  112,381 $  111,485 

 

PARK NATIONAL CORPORATION
Consolidated Statements of Income
     
 Three Months EndedSix Months Ended
 June 30,June 30,
(in thousands, except share and per share data) 2015  2014  2015  2014 
     
Interest income:    
  Interest and fees on loans$   56,463  $  57,004 $   111,875  $  111,757 
  Interest on:    
  Obligations of U.S. Government, its agencies    
  and other securities 9,113  9,271  18,502  18,747 
  Other interest income 228  88  445  201 
  Total interest income 65,804  66,363  130,822  130,705 
     
Interest expense:    
  Interest on deposits:    
  Demand and savings deposits 556  399  1,042  792 
  Time deposits 2,542  2,133  5,164  4,411 
  Interest on borrowings 6,191  7,270  12,566  14,461 
  Total interest expense 9,289  9,802  18,772  19,664 
     
  Net interest income 56,515  56,561  112,050  111,041 
     
Provision for (recovery of) loan losses 1,612  (1,260) 3,244  (3,485)
     
  Net interest income after provision for (recovery of) loan losses 54,903  57,821  108,806  114,526 
     
Other income 19,191  19,671  38,064  36,319 
     
Other expense 44,667  46,241  90,387  92,020 
     
  Income before income taxes 29,427  31,251  56,483  58,825 
     
Income taxes 8,388  9,441  16,400  17,438 
     
  Net income$   21,039  $  21,810 $   40,083  $  41,387 
     
Per Common Share:    
  Net income  - basic$   1.37  $  1.42 $   2.61  $  2.69 
  Net income  - diluted$   1.37  $  1.42 $   2.60  $  2.69 
     
  Weighted average shares - basic 15,370,882  15,392,435  15,375,026  15,396,770 
  Weighted average shares - diluted 15,407,881  15,412,167  15,411,920  15,413,568 
     
  Cash Dividends Declared$  0.94 $  0.94 $  1.88 $  1.88 

 

PARK NATIONAL CORPORATION
Consolidated Balance Sheets
   
(in thousands, except share data)June 30, 2015December 31, 2014
   
Assets  
   
Cash and due from banks$   127,501  $  133,511 
Money market instruments 276,785  104,188 
Investment securities 1,550,103  1,500,788 
Loans 4,900,974  4,829,682 
Allowance for loan losses (57,427) (54,352)
Loans, net 4,843,547  4,775,330 
Bank premises and equipment, net 58,725  55,479 
Goodwill 72,334  72,334 
Other real estate owned 21,876  22,605 
Other assets 358,698  336,964 
Total assets$ 7,309,569  $  7,001,199 
   
Liabilities and Shareholders' Equity  
   
Deposits:  
Noninterest bearing$ 1,299,264  $  1,269,296 
Interest bearing 4,213,102  3,858,704 
Total deposits 5,512,366  5,128,000 
Borrowings 1,018,680  1,108,582 
Other liabilities 72,560  68,076 
Total liabilities$ 6,603,606  $  6,304,658 
   
   
Shareholders' Equity:  
Preferred shares (200,000 shares authorized; no shares outstanding at June 30, 2015 and December 31, 2014)$—$—
   
Common shares (No par value; 20,000,000 shares authorized in 2015 and 2014; 16,150,866 shares issued at June 30, 2015 and 16,150,888 shares issued at December 31, 2014) 303,573  303,104 
Accumulated other comprehensive loss, net of taxes (13,980) (13,608)
Retained earnings 495,592  484,484 
Treasury shares (779,989 shares at June 30, 2015 and 758,489 shares at December 31, 2014) (79,222)  (77,439
Total shareholders' equity$   705,963  $  696,541 
   
Total liabilities and shareholders' equity$ 7,309,569  $  7,001,199 

 

PARK NATIONAL CORPORATION
Consolidated Average Balance Sheets
     
 Three Months EndedSix Months Ended
 June 30,June 30,
(in thousands) 2015  2014  2015  2014 
     
Assets    
     
Cash and due from banks$   116,542  $  106,844 $   119,603  $  110,169 
Money market instruments 361,994  137,219  351,591  159,001 
Investment securities 1,481,460  1,409,368  1,485,978  1,413,252 
Loans 4,857,799  4,678,483  4,836,696  4,643,037 
Allowance for loan losses (56,291) (58,234) (55,664) (59,487)
Loans, net 4,801,508  4,620,249  4,781,032  4,583,550 
Bank premises and equipment, net 57,978  55,453  57,272  55,633 
Goodwill and other intangibles 72,334  72,334  72,334  72,334 
Other real estate owned 22,661  29,017  22,991  31,489 
Other assets 351,278  341,923  346,804  343,208 
Total assets$   7,265,755  $  6,772,407 $   7,237,605  $  6,768,636 
     
     
Liabilities and Shareholders' Equity    
     
Deposits:    
Noninterest bearing$   1,303,420  $  1,172,952 $   1,283,977  $  1,174,520 
Interest bearing 4,166,835  3,745,385  4,116,789  3,747,105 
Total deposits 5,470,255  4,918,337  5,400,766  4,921,625 
Borrowings 1,007,975  1,120,608  1,055,081  1,119,263 
Other liabilities 78,494  58,219  74,711  60,184 
Total liabilities$   6,556,724  $  6,097,164 $   6,530,558  $  6,101,072 
     
Shareholders' Equity:    
Preferred shares $  $ —  $ — 
Common shares 303,431   302,754   303,270  302,706 
Accumulated other comprehensive loss, net of taxes (7,224) (17,968) (7,638) (22,457)
Retained earnings 492,046  468,070  490,295  464,608 
Treasury shares (79,222) (77,613) (78,880) (77,293)
Total shareholders' equity$   709,031  $  675,243 $   707,047  $  667,564 
     
Total liabilities and shareholders' equity$   7,265,755  $  6,772,407 $   7,237,605  $  6,768,636 
  

 

PARK NATIONAL CORPORATION
Consolidated Statements of Income - Linked Quarters
      
  2015  2015  2014  2014  2014 
(in thousands, except per share data)2nd QTR1st QTR4th QTR3rd QTR2nd QTR
      
Interest income:     
Interest and fees on loans$   56,463  $  55,412 $  58,395 $  57,492 $  57,004 
Interest on:     
Obligations of U.S. Government, its agencies and other securities 9,113  9,389  9,223  9,011  9,271 
Obligations of states and political subdivisions 1 
Other interest income 228  217  198  119  87 
Total interest income 65,804  65,018  67,816  66,622  66,363 
      
Interest expense:     
Interest on deposits:     
Demand and savings deposits 556  486  445  440  399 
Time deposits 2,542  2,622  2,776  2,136  2,133 
Interest on borrowings 6,191  6,375  7,301  7,337  7,270 
Total interest expense 9,289  9,483  10,522  9,913  9,802 
      
Net interest income 56,515  55,535  57,294  56,709  56,561 
      
Provision for (recovery of) loan losses 1,612  1,632  (8,349) 4,501  (1,260)
      
Net interest income after provision for (recovery of) loan losses 54,903  53,903  65,643  52,208  57,821 
      
Other income 19,191  18,873  19,834  19,396  19,671 
      
Other expense 44,667  45,720  50,518  44,972  46,241 
      
Income before income taxes 29,427  27,056  34,959  26,632  31,251 
      
Income taxes 8,388  8,012  10,658  8,363  9,441 
      
Net income$   21,039  $  19,044 $  24,301 $  18,269 $  21,810 
      
Per Common Share:     
Net income - basic$   1.37  $  1.24 $  1.58 $  1.19 $  1.42 
Net income - diluted$   1.37  $  1.23 $  1.58 $  1.19 $  1.42 

 

PARK NATIONAL CORPORATION
Detail of other income and other expense - Linked Quarters
      
  2015  2015  2014  2014  2014 
(in thousands)2nd QTR1st QTR4th QTR3rd QTR2nd QTR
      
Other income:     
Income from fiduciary activities$   5,210  $  4,912 $  5,050 $  4,734 $  4,825 
Service charges on deposits 3,684  3,381  3,651  4,171  3,942 
Other service income 3,025  2,301  3,564  2,450  2,527 
Checkcard fee income 3,665  3,351  3,433  3,431  3,493 
Bank owned life insurance income 1,086  1,878  1,153  1,420  1,026 
OREO valuation adjustments (251 (304 (380) (935) (675)
Gain on the sale of OREO, net 513  673  45  2,149  2,603 
Gain on commercial loans held for sale 756  1,867 
(Loss) gain on sale of investments (1,175) 17 
Miscellaneous 2,259  1,925  2,626  1,976  1,913 
Total other income$   19,191  $  18,873 $  19,834 $  19,396 $  19,671 
      
Other expense:     
Salaries and employee benefits$   25,724  $  26,667 $  24,525 $  26,243 $  26,140 
Occupancy expense 2,381  2,579  2,378  2,339  2,457 
Furniture and equipment expense 2,831  2,862  2,709  2,870  2,994 
Data processing fees 1,197  1,267  1,196  1,281  1,121 
Professional fees and services 5,583  4,694  8,195  6,934  8,168 
Marketing 937  1,013  1,160  1,087  1,006 
Insurance 1,362  1,461  1,413  1,396  1,467 
Communication 1,233  1,331  1,328  1,304  1,293 
Miscellaneous 3,419  3,846  7,614  1,518  1,595 
Total other expense$   44,667  $  45,720 $  50,518 $  44,972 $  46,241 

 

PARK NATIONAL CORPORATION
Asset Quality Information
         
     Year ended December 31,  
(in thousands, except ratios)June 30,
2015
March 31,
2015
 2014   2013  2012      2011    
         
Allowance for loan losses:        
Allowance for loan losses, beginning of period$  55,408 $  54,352 $  59,468  $  55,537 $  68,444  $     143,575    
Transfer of loans at fair value      (219)   
Transfer of allowance to held for sale      (13,100)   
Charge-offs 3,027  3,418  24,780 (B) 19,153  61,268 (A)    133,882    
Recoveries 3,434  2,842  26,997   19,669  12,942      8,798    
Net (recoveries) charge-offs (407) 576  (2,217)  (516) 48,326      125,084    
Provision for (recovery of) loan losses 1,612  1,632  (7,333)  3,415  35,419      63,272    
Allowance for loan losses, end of period$  57,427 $  55,408 $  54,352  $  59,468 $  55,537  $     68,444    
(A) Year ended December 31, 2012 included the full charge-off of the Vision Bank ALLL of $12.1 million to bring the retained Vision Bank loan portfolio to fair value prior to the merger of Vision Bank (as constituted following the transaction with Centennial Bank and Home BancShares, Inc.) with and into SEPH, the non-bank subsidiary of Park, on February 16, 2012. 
         
(B) Year ended December 31, 2014 included $4.3 million in charge-offs related to the transfer of $22.0 million of commercial loans to the held for sale portfolio. 
         
General reserve trends:        
Allowance for loan losses, end of period$  57,427 $  55,408 $  54,352  $  59,468 $  55,537  $     68,444    
Specific reserves 6,597  5,064  3,660   10,451  8,276      15,935    
General reserves$  50,830 $  50,344 $  50,692  $  49,017 $  47,261  $     52,509    
         
Total loans$  4,900,974 $  4,830,830 $  4,829,682  $  4,620,505 $  4,450,322  $     4,317,099    
Impaired commercial loans 70,553  70,461  73,676   112,304  137,238      187,074    
Total loans less impaired commercial loans$ 4,830,421 $ 4,760,369 $ 4,756,006  $ 4,508,201 $ 4,313,084  $    4,130,025    
         
         
Asset Quality Ratios:        
Net (recoveries) charge-offs as a % of average loans (0.03%) 0.05 (0.05)%  (0.01)% 1.10     2.65  % 
Allowance for loan losses as a % of period end loans 1.17 1.15 1.13  1.29 1.25     1.59  % 
General reserves as a % of total loans less impaired commercial loans 1.05 1.06  1.07  1.09 1.10     1.27  % 
         
Nonperforming Assets - Park National Corporation:        
Nonaccrual loans$  95,739 $  95,873 $  100,393  $  135,216 $  155,536  $     195,106    
Accruing troubled debt restructuring 16,520  16,802  16,254   18,747  29,800      28,607    
Loans past due 90 days or more 1,536  1,629  2,641   1,677  2,970      3,489    
Total nonperforming loans$  113,795 $  114,304 $  119,288  $  155,640 $  188,306  $     227,202    
Other real estate owned - Park National Bank 8,774  10,223  10,687   11,412  14,715      13,240    
Other real estate owned - SEPH 13,102  16,114  11,918   23,224  21,003      29,032    
Other real estate owned - Vision Bank  
Total nonperforming assets$  135,671 $  140,641 $  141,893  $  190,276 $  224,024  $     269,474    
Percentage of nonaccrual loans to period end loans 1.95 1.98 2.08  2.93 3.49     4.52   
Percentage of nonperforming loans to period end loans 2.32 2.37 2.47  3.37 4.23     5.26   
Percentage of nonperforming assets to period end loans 2.77 2.91 2.94  4.12 5.03     6.24   
Percentage of nonperforming assets to period end assets 1.86 1.92 2.03  2.87 3.37     3.86   

 

PARK NATIONAL CORPORATION
Asset Quality Information (continued)
       
    Year ended December 31, 
(in thousands, except ratios)June 30, 2015March 31, 2015 2014  2013  2012  2011 
       
Nonperforming Assets - Park National Bank and Guardian:      
Nonaccrual loans$  80,470 $  77,387 $  77,477 $  99,108 $  100,244 $  96,113 
Accruing troubled debt restructuring 16,423  16,706  16,157  18,747  29,800  26,342 
Loans past due 90 days or more 1,536  1,629  2,641  1,677  2,970  3,367 
Total nonperforming loans$  98,429 $  95,722 $  96,275 $ 119,532 $ 133,014 $ 125,822 
Other real estate owned - Park National Bank 8,774  10,223  10,687  11,412  14,715  13,240 
Total nonperforming assets$ 107,203 $ 105,945 $ 106,962 $ 130,944 $ 147,729 $ 139,062 
Percentage of nonaccrual loans to period end loans 1.65 1.61 1.61 2.16 2.28 2.29
Percentage of nonperforming loans to period end loans 2.02 1.99 2.00 2.61 3.03 3.00
Percentage of nonperforming assets to period end loans 2.19 2.20 2.23 2.86 3.36 3.32
Percentage of nonperforming assets to period end assets 1.48 1.47 1.55 2.01 2.27 2.21
       
Nonperforming Assets - SEPH/Vision Bank (retained portfolio as of June 30, 2015, March 31, 2015, and December 31, 2014, 2013, 2012, and 2011): 
Nonaccrual loans$  15,269 $  18,486 $  22,916 $  36,108 $  55,292 $  98,993 
Accruing troubled debt restructuring 97  96  97  2,265 
Loans past due 90 days or more 122 
Total nonperforming loans$  15,366 $  18,582 $  23,013 $  36,108 $  55,292 $ 101,380 
Other real estate owned - Vision Bank
Other real estate owned - SEPH 13,102  16,114  11,918  23,224  21,003  29,032 
Total nonperforming assets$  28,468 $  34,696 $  34,931 $  59,332 $  76,295 $ 130,412 
Percentage of nonaccrual loans to period end loansN.M.N.M.N.M.N.M.N.M.N.M.
Percentage of nonperforming loans to period end loansN.M.N.M.N.M.N.M.N.M.N.M.
Percentage of nonperforming assets to period end loansN.M.N.M.N.M.N.M.N.M.N.M.
Percentage of nonperforming assets to period end assetsN.M.N.M.N.M.N.M.N.M.N.M.

 

PARK NATIONAL CORPORATION
Asset Quality Information (continued)
       
    Year ended December 31,  
(in thousands, except ratios)June 30,
2015
March 31,
2015
 2014  2013  2012  2011 
       
New nonaccrual loan information - Park National Corporation      
Nonaccrual loans, beginning of period$  95,873 $  100,393 $  135,216 $  155,536 $  195,106 $  289,268 
New nonaccrual loans 23,974  13,844  70,059  67,398  83,204  124,158 
Resolved nonaccrual loans 24,108  18,232  86,384  87,718  122,774  218,320 
Sale of nonaccrual loans held for sale 132  18,498 
Nonaccrual loans, end of period$  95,739 $  95,873 $  100,393 $  135,216 $  155,536 $  195,106 
       
New nonaccrual loan information - Ohio - based operations      
Nonaccrual loans, beginning of period$  77,387 $  77,477 $  99,108 $  100,244 $  96,113 $  117,815 
New nonaccrual loans - Ohio-based operations 23,974  13,844  69,389  66,197  68,960  78,316 
Resolved nonaccrual loans 20,891  13,934  78,288  67,333  64,829  100,018 
Sale of nonaccrual loans held for sale 12,732 
Nonaccrual loans, end of period$  80,470 $  77,387 $  77,477 $  99,108 $  100,244 $  96,113 
       
New nonaccrual loan information - SEPH/Vision Bank      
Nonaccrual loans, beginning of period$  18,486 $  22,916 $  36,108 $  55,292 $  98,993 $  171,453 
New nonaccrual loans - SEPH/Vision Bank 670  1,201  14,243  45,842 
Resolved nonaccrual loans 3,217  4,298  8,096  20,385  57,944  118,302 
Sale of nonaccrual loans held for sale 132  5,766 
Nonaccrual loans, end of period$  15,269 $  18,486 $  22,916 $  36,108 $  55,292 $  98,993 
       
Impaired Commercial Loan Portfolio Information (period end):      
Unpaid principal balance$  100,577 $  96,235 $  106,156 $  175,576 $  242,345 $  290,908 
Prior charge-offs 30,024  25,774  32,480  63,272  105,107  103,834 
Remaining principal balance 70,553  70,461  73,676  112,304  137,238  187,074 
Specific reserves 6,597  5,064  3,660  10,451  8,276  15,935 
Book value, after specific reserve$  63,956 $  65,397 $  70,016 $  101,853 $  128,962 $  171,139 

  

Media contact: Bethany Lewis, 740.349.0421, blewis@parknationalbank.com
Investor contact: Brady Burt, 740.322.6844, bburt@parknationalbank.com
NEXT ARTICLE

More From BioPortfolio on "Park National Corporation Reports Second Quarter 2015 Financial Results and Declares Quarterly Dividend"

Advertisement
Quick Search
Advertisement
Advertisement

 

Relevant Topic

Mergers & Acquisitions
Commercial and market reports on mergers and acquisitions in the biotechnology, pharmaceutical, medical device and life-science industries. Mergers and acquisitions (abbreviated M&A;) is an aspect of corporate strategy, corporate finance and manageme...