WARSAW, N.Y., July 20 /PRNewswire-FirstCall/ -- Financial Institutions,
Inc. (Nasdaq: FISI) today reported second quarter 2004 net income of
$5.6 million, an increase of $1.9 million over second quarter 2003 net income
of $3.7 million and an increase of $3.0 million over the $2.6 million earned
in the first quarter of 2004. Diluted earnings per share for the second
quarter of 2004 were $0.46, compared to $0.29 per share for the second quarter
of 2003 and $0.20 for the first quarter of 2004. Net income for the first six
months of 2004 was $8.2 million or $0.66 per share compared to $7.9 million or
$0.64 per share for the same period in 2003. The improved earnings for the
second quarter of 2004 were largely the result of a decrease in the provision
for loan losses, which was $2.5 million for the second quarter of 2004
compared to $5.3 million for the second quarter of 2003 and $4.8 million for
the first quarter of 2004. The Company also recorded a gain in the second
quarter of 2004 of $1.2 million from the sale of its credit card portfolio.
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Peter G. Humphrey, President and CEO of Financial Institutions, Inc. (FII)
stated: "The Company has focused considerable resources on managing credit
risk and resolving credit quality issues. Our improved earnings are
reflective of those efforts. Our overall level of nonperforming assets
remains relatively high, but progress on resolution of our asset quality
issues has gained momentum. Earnings have increased, our capital position is
strong and we continue to penetrate markets we have recently entered."
Nonperforming assets declined to $49.978 million at June 30, 2004,
compared to $52.103 million at December 31, 2003 and $50.676 million at June
30, 2003. Net loan charge-offs for the second quarter of 2004 were
$1.6 million, or 0.48% of average loans, down from $2.2 million, or 0.66% of
average loans in the same period last year. The ratio of the allowance for
loan losses to nonperforming loans was 63% at June 30, 2004, compared to 56%
at December 31, 2003 and 53% at June 30, 2003. The ratio of the allowance for
loan losses to total loans increased to 2.38% at June 30, 2004, compared to
2.16% at December 31, 2003, and 1.93% at June 30, 2003.
In the second quarter of 2004, net interest income decreased 3% to
$18.7 million, compared to $19.2 million in the second quarter of 2003. Net
interest margin was 3.82% for the second quarter of 2004, a drop of 16 basis
points from 3.98% for the same period last year and a decline of 4 basis
points from the first quarter of 2004. The decline in net interest income and
net interest margin results from the low interest rate environment coupled
with decreased loan production. Total loans at June 30, 2004 were $1.302
billion, a decline of $43 million from December 31, 2003 and down $69 million
from one year ago. The Company has been actively working to reduce credit
risk in the loan portfolio.
Noninterest income increased 18% in the second quarter of 2004 to
$7.3 million compared to $6.2 million for the same period last year. The most
significant item impacting noninterest income during the recent quarter was
the $1.2 million gain from the sale of the credit card portfolio. This gain
was partially offset by a decrease in mortgage banking income from $951,000 in
the second quarter of 2003 to $601,000 in the current quarter, a direct result
of the decline in the volume of residential mortgage loans sold relative to
the record refinancing activity of 2003.
Noninterest expense for the second quarter of 2004 totaled $15.7 million
compared with $14.9 million for the second quarter of 2003. The increase in
noninterest expense is attributable to higher credit collection costs and
costs for additional lending and credit administration staff. The additional
noninterest expenses, coupled with a slowing of revenue growth, are the
principal factors in the increase in the Company's efficiency ratio to 59.51%
for the three months ended June 30, 2004, compared to 53.41% for the same
period a year ago.
At June 30, 2004 the Company had total assets of $2.179 billion, a 1%
decrease from $2.194 billion at June 30, 2003. Total deposits were
$1.849 billion at the end of second quarter 2004, compared with $1.826 billion
a year earlier. Total shareholders' equity at June 30, 2004 was $177 million
compared to $186 million a year earlier. The decrease in shareholders' equity
reflects a $16 million year-over-year decline in the fair value of securities
available for sale, net of taxes. Book value per common share at June 30,
2004 was $14.20, a decrease of 6% from $15.11 at June 30, 2003. Common stock
dividends of $0.16 per share were declared in the second quarter of 2004 and
2003.
FII is the bank holding company parent of Wyoming County Bank, The
National Bank of Geneva, Bath National Bank, and First Tier Bank and Trust.
The four banks provide a wide range of consumer and commercial banking
services to individuals, municipalities, and businesses through a network of
49 offices and 70 ATMs in Western and Central New York State. FII's Financial
Services Group also provides diversified financial services to its customers
and clients, including brokerage, trust, insurance and employee benefits and
compensation consulting. More information on FII and its subsidiaries is
available through the Company web site at http://www.fiiwarsaw.com.
This press release may contain forward-looking statements as defined by
federal securities laws. These statements may address issues that involve
significant risks, uncertainties, estimates and assumptions made by
management. Actual results could differ materially from current beliefs or
projections. Please refer to the Company's filings with the Securities and
Exchange Commission for a summary of important factors that could affect the
Company's forward-looking statements. The Company undertakes no obligation to
revise these statements following the date of this press release.
FINANCIAL INSTITUTIONS, INC. AND SUBSIDIARIES
Consolidated Statement of Income
(Dollars in thousands, except per share amounts)
For the three months ended
June 30,
2004 2003 $ %
Change Change
Interest income $26,414 $28,764 $(2,350) (8)%
Interest expense 7,718 9,571 (1,853) (19)%
Net interest income 18,696 19,193 (497) (3)%
Provision for loan losses 2,516 5,311 (2,795) (53)%
Net interest income
after provision for
loan losses 16,180 13,882 2,298 17%
Noninterest income:
Service charges on
deposits 3,047 2,771 276 10%
Financial services group
fees and commissions 1,545 1,328 217 16%
Mortgage banking
activities 601 951 (350) (37)%
Gain on sale and call
of securities 24 151 (127) (84)%
Gain on sale of credit
card portfolio 1,177 - 1,177 N/A
Other 870 959 (89) (9)%
Total noninterest
income 7,264 6,160 1,104 18%
Noninterest expense:
Salaries and employee
benefits 9,068 8,036 1,032 13%
Other 6,596 6,911 (315) (5)%
Total noninterest
expense 15,664 14,947 717 5%
Income before income taxes 7,780 5,095 2,685 53%
Income taxes 2,220 1,445 775 54%
Net income 5,560 3,650 1,910 52%
Preferred stock dividends 374 374 - -%
Net income available to
common shareholders $5,186 $3,276 $1,910 58%
Memo: Taxable-equivalent
net interest income $19,829 $20,332 $(503) (2)%
Per common share data:
Net income - basic $0.46 $0.29 $0.17 59%
Net income - diluted $0.46 $0.29 $0.17 59%
Cash dividends declared $0.16 $0.16 $- -%
Book value $14.20 $15.11 $(0.91) (6)%
Common shares outstanding:
Weighted average shares
- actual 11,183,193 11,159,140
Weighted average shares
- diluted 11,245,386 11,255,623
Period end actual 11,195,535 11,156,017
Performance ratios, annualized:
Return on average assets 1.01% 0.67%
Return on average
common equity 12.66% 7.82%
Common dividend payout
ratio 34.78% 55.17%
Net interest margin
(tax-equivalent) 3.82% 3.98%
Efficiency ratio 59.51% 53.41%
Asset quality data:
Loans past due over 90
days and still accruing $1,685 $1,195
Restructured loans - 3,076
Nonaccrual loans 47,333 45,765
Other real estate owned 960 640
Total nonperforming
assets $49,978 $50,676
Net loan charge-offs $1,578 $2,227
Asset quality ratios:
Nonperforming loans to
total loans 3.77% 3.65%
Nonperforming assets to
total loans and ORE 3.84% 3.70%
Allowance for loan losses
to total loans 2.38% 1.93%
Allowance for loan losses
to nonperforming loans 63% 53%
Net loan charge-offs to
average loans
(annualized) 0.48% 0.66%
Capital ratios:
Average common equity to
average total assets 7.43% 7.71%
Leverage ratio 7.03% 6.83%
Tier 1 risk-based
capital ratio 10.75% 9.77%
Risk-based capital ratio 12.01% 11.03%
FINANCIAL INSTITUTIONS, INC. AND SUBSIDIARIES
Consolidated Statement of Income
(Dollars in thousands, except per share amounts)
For the six months ended
June 30,
2004 2003 $ %
Change Change
Interest income $52,731 $57,291 $(4,560) (8)%
Interest expense 15,578 19,257 (3,679) (19)%
Net interest income 37,153 38,034 (881) (2)%
Provision for loan
losses 7,312 8,609 (1,297) (15)%
Net interest income
after provision for
loan losses 29,841 29,425 416 1%
Noninterest income:
Service charges on
deposits 5,865 5,426 439 8%
Financial services
group fees and
commissions 2,965 2,702 263 10%
Mortgage banking
activities 1,124 1,736 (612) (35)%
Gain on sale and call
of securities 74 442 (368) (83)%
Gain on sale of credit
card portfolio 1,177 - 1,177 N/A
Other 1,912 1,956 (44) (2)%
Total noninterest
income 13,117 12,262 855 7%
Noninterest expense:
Salaries and employee
benefits 18,220 16,917 1,303 8%
Other 13,352 13,606 (254) (2)%
Total noninterest
expense 31,572 30,523 1,049 3%
Income before
income taxes 11,386 11,164 222 2%
Income taxes 3,179 3,218 (39) (1)%
Net income 8,207 7,946 261 3%
Preferred stock dividends 748 748 - -%
Net income available to
common shareholders $7,459 $7,198 $261 4%
Memo: Taxable-equivalent
net interest income $39,411 $40,311 $(900) (2)%
Per common share data:
Net income - basic $0.67 $0.65 $0.02 3%
Net income - diluted $0.66 $0.64 $0.02 3%
Cash dividends declared $0.32 $0.32 $- -%
Common shares outstanding:
Weighted average shares
- actual 11,177,082 11,133,222
Weighted average shares
- diluted 11,245,792 11,234,187
Period end actual 11,195,535 11,156,017
Performance ratios, annualized:
Return on average assets 0.75% 0.74%
Return on average
common equity 9.00% 8.75%
Common dividend payout
ratio 47.76% 49.23%
Net interest margin
(tax-equivalent) 3.84% 4.00%
Efficiency ratio 60.32% 56.15%
Net loan charge-offs
to average loans
(annualized) 0.82% 0.56%
FINANCIAL INSTITUTIONS, INC. AND SUBSIDIARIES
Consolidated Statements of Financial Condition
(Dollars in thousands)
June 30
2004 2003 $ %
Change Change
ASSETS
Cash, due from banks and
interest-bearing deposits $49,953 $64,491 $(14,538) (23)%
Federal funds sold 1,685 77,333 (75,648) (98)%
Investment securities 727,958 594,583 133,375 22%
Loans 1,301,878 1,370,653 (68,775) (5)%
Allowance for loan
losses (30,961) (26,518) (4,443) 17%
Loans, net 1,270,917 1,344,135 (73,218) (5)%
Goodwill 40,946 40,621 325 1%
Other assets 87,319 73,160 14,159 19%
Total assets $2,178,778 $2,194,323 $(15,545) (1)%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Demand $273,033 $251,994 $21,039 8%
Savings, money market,
and int-bearing checking 808,870 799,572 9,298 1%
Certificates of deposit 767,472 774,667 (7,195) (1)%
Total deposits 1,849,375 1,826,233 23,142 1%
Short-term borrowings 32,969 68,985 (36,016) (52)%
Long-term borrowings 83,451 73,216 10,235 14%
Junior subordinated
debentures 16,702 - 16,702 N/A
Trust preferred securities - 16,200 (16,200) (100)%
Other liabilities 19,518 23,429 (3,911) (17)%
Total liabilities 2,002,015 2,008,063 (6,048) -%
Shareholders' equity:
Preferred equity 17,734 17,735 (1) -%
Common equity 159,029 168,525 (9,496) (6)%
Total shareholders'
equity (1) 176,763 186,260 (9,497) (5)%
Total liabilities
and shareholders'
equity $2,178,778 $2,194,323 $(15,545) (1)%
(1) Includes the after-tax impact of net unrealized gains (losses) on
investment securities classified as available for sale of $(2,601) and
$13,604 at June 30, 2004 and 2003, respectively.
FINANCIAL INSTITUTIONS, INC. AND SUBSIDIARIES
Consolidated Average Statements of Financial Condition
(Dollars in thousands)
For the three months ended
June 30,
2004 2003 $ %
Change Change
ASSETS
Cash, due from banks and
interest-bearing deposits $43,147 $42,814 $333 1%
Federal funds sold 37,387 40,512 (3,125) (8)%
Investment securities 735,835 647,383 88,452 14%
Loans 1,308,863 1,359,311 (50,448) (4)%
Allowance for loan losses (30,493) (23,818) (6,675) 28%
Loans, net 1,278,370 1,335,493 (57,123) (4)%
Goodwill 40,746 40,621 125 -%
Other assets 81,135 72,188 8,947 12%
Total assets $2,216,620 $2,179,011 $37,609 2%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Demand $261,293 $236,221 $25,072 11%
Savings, money market,
and int-bearing checking 840,419 804,196 36,223 5%
Certificates of deposit 778,605 766,729 11,876 2%
Total deposits 1,880,317 1,807,146 73,171 4%
Short-term borrowings 36,984 64,568 (27,584) (43)%
Long-term borrowings 85,395 82,443 2,952 4%
Junior subordinated
debentures 16,702 - 16,702 N/A
Trust preferred securities - 16,200 (16,200) (100)%
Other liabilities 14,763 22,940 (8,177) (36)%
Total liabilities 2,034,161 1,993,297 40,864 2%
Shareholders' equity:
Preferred equity 17,734 17,737 (3) -%
Common equity 164,725 167,977 (3,252) (2)%
Total shareholders'
equity 182,459 185,714 (3,255) (2)%
Total liabilities
and shareholders'
equity $2,216,620 $2,179,011 $37,609 2%
FINANCIAL INSTITUTIONS, INC. AND SUBSIDIARIES
Consolidated Average Statements of Financial Condition
(Dollars in thousands)
For the six months ended
June 30,
2004 2003 $ %
Change Change
ASSETS
Cash, due from banks and
interest-bearing deposits $44,043 $42,890 $1,153 3%
Federal funds sold 44,766 36,802 7,964 22%
Investment securities 695,600 643,798 51,802 8%
Loans 1,318,997 1,344,732 (25,735) (2)%
Allowance for loan losses (29,787) (22,896) (6,891) 30%
Loans, net 1,289,210 1,321,836 (32,626) (2)%
Goodwill 40,683 40,612 71 -%
Other assets 79,647 71,122 8,525 12%
Total assets $2,193,949 $2,157,060 $36,889 2%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Demand $256,937 $232,379 $24,558 11%
Savings, money market,
and int-bearing checking 818,768 801,667 17,101 2%
Certificates of deposit 776,140 745,664 30,476 4%
Total deposits 1,851,845 1,779,710 72,135 4%
Short-term borrowings 40,692 62,551 (21,859) (35)%
Long-term borrowings 85,732 92,286 (6,554) (7)%
Junior subordinated
debentures 16,702 - 16,702 N/A
Trust preferred securities - 16,200 (16,200) (100)%
Other liabilities 14,530 22,714 (8,184) (36)%
Total liabilities 2,009,501 1,973,461 36,040 2%
Shareholders' equity:
Preferred equity 17,734 17,740 (6) -%
Common equity 166,714 165,859 855 1%
Total shareholders'
equity 184,448 183,599 849 -%
Total liabilities
and shareholders'
equity $2,193,949 $2,157,060 $36,889 2%
SOURCE Financial Institutions, Inc.
-0- 07/20/2004
/CONTACT: Ronald A. Miller, Senior Vice President and Chief Financial
Officer of Financial Institutions, +1-585-786-1102/
/Photo: http://www.newscom.com/cgi-bin/prnh/20030114/FISILOGO /
/Web site: http://www.fiiwarsaw.com /
(FISI)
CO: Financial Institutions, Inc.
ST: New York
IN: FIN
SU: ERN
KC
-- NYTU100 --
6234 07/20/200410:38 EDThttp://www.prnewswire.com