Cadence Financial Corporation (NASDAQ: CADE), a financial holding company whose principal subsidiary is Cadence Bank, N.A., today reported net income of $2.6 million, or $0.22 per diluted share, for the third quarter ended September 30, 2007.
"Total loans increased 20%, or $225 million, since last year due to strong growth in our Tennessee and Alabama markets, and the contribution from the Seasons acquisition," stated Lewis F. Mallory, Jr., chairman and chief executive officer of Cadence Financial Corporation. "The strong loan growth contributed to net interest income rising more than 12% in the third quarter of 2007 compared with the same quarter last year."
Third Quarter Results
Net interest income rose 12.4% to $14.6 million in the third quarter of 2007 compared with $13.0 million in the third quarter of 2006. The growth in net interest income was due to a 16.7% increase in average earning assets and offset somewhat by a 12-basis-point decrease in net interest margin. Compared with the linked second quarter of 2007, average earning assets increased $29.7 million and the net margin declined 2-basis-points.
Total interest income rose 22.4% to $31.3 million for the third quarter of 2007 compared with $25.5 million in the third quarter of 2006. Interest and fees on loans increased 31.3% due to a 6-basis-point increase in average yields and a $304 million increase in average loan balances from the third quarter of 2006. Interest and dividends on investment securities declined 3.6% to $5.5 million compared with the third quarter of 2006 due to a 22-basis-point improvement in yield, partially offset by a $37.9 million decrease in the average investment securities portfolio.
Cadence's provision for loan losses was $3.2 million in the third quarter of 2007 compared with a credit to the provision for loan losses of $72,000 in the same period last year. The increase in the provision for loan losses was primarily related to several large credits and a softening in certain real estate sectors. At the end of the third quarter 2007, the allowance for loan losses was $13.1 million, or 1.0% of total loans, compared with $10.8 million, or 1.0% of total loans, in the third quarter of 2006. Net interest income after provision for loan losses declined 12.2% to $11.5 million in the third quarter compared with $13.1 million last year. The Company is funding its allowance for loan losses at the maximum level permitted by its evaluation of allowance adequacy.
"The increase in our third quarter loan loss provision was due to credit losses related to a large commercial loan and a large agricultural loan, combined with a softening in certain real estate sectors," continued Mr. Mallory. "We estimate the additional loan loss provision was equivalent to about $0.11 per share after-tax this quarter compared with our original estimates for the quarter.
"Our loan portfolio has grown significantly since last year, largely due to our success in generating real estate loans across our markets and in a number of real estate sectors. We believe our underwriting standards have been solid; however, we have tightened loan criteria for certain segments to reflect the change in market conditions. We believe our current coverage ratio of 124.9% for allowance to non-performing loans provides Cadence with a solid cushion at this time but would expect any future softening in the market to be reflected in higher loan loss provisions in future quarters," continued Mr. Mallory.
Total non-interest income rose to $5.8 million in the third quarter of 2007 compared with $3.8 million in the third quarter of 2006. Cadence reported growth in service charges, trust department income, and mortgage loan fee income in the third quarter of 2007 compared with the third quarter of 2006. The 2006 results included a $2.0 million impairment loss on securities and no comparable loss in 2007. In addition, other income for 2006 included a $434,000 gain on the early extinguishment of debt related to Federal Home Loan borrowings. No comparable gain was recorded in 2007. Cadence also recorded $43,000 in securities gains in the 2007 quarter compared with $2,000 of securities gains in 2006.
Non-interest expenses increased 9% to $13.8 million compared with the third quarter of 2006. The increase was due primarily to expenses associated with the acquisitions in Florida and Georgia, including higher premises expense, salary and employee benefits, and the addition of two branches in Memphis.
Income before taxes declined 17.6% to $3.5 million in the third quarter of 2007 compared with $4.2 million in the third quarter of 2006. The tax rate for the third quarter of 2007 was 24.7% compared with 26.3% in the same period last year.
Net income for the third quarter of 2007 was $2.6 million, or $0.22 per diluted share, compared with net income of $3.1 million, or $0.27 per diluted share, in the third quarter of 2006. The additional third quarter loan loss provision reduced earnings by approximately $0.11 per diluted share after-tax compared with the original estimates for the quarter. Diluted weighted average shares outstanding increased 4.6% to 11.9 million in the third quarter of 2007 compared with 11.4 million in the third quarter of 2006. The additional shares are attributable to 922,000 shares issued in the SunCoast acquisition in August 2006.
Nine-Month Results
Net interest income rose 15.8% to $42.7 million in the first nine months of 2007 compared with $36.8 million in the same period of 2006. Net income for the first nine months of 2007 was $6.3 million, or $0.53 per diluted share, compared with $9.9 million, or $1.01 per diluted share, in the same period of 2006.
The decline in net income was due primarily to a $5.1 million ($0.26 per diluted share) impairment loss on securities recorded in the first quarter of 2007 and a $4.1 million (0.21 per diluted share) increase in the loan loss provision compared with the prior year's results for the nine months. The results for the first nine months of 2007 reflect the restatement of the first quarter's results related to the Company's decision to rescind its application of SFAS 159 to the securities previously reclassified from the available for sale account to the trading account as reported in its first quarter 2007 press release and Form 10-Q. As a result, Cadence restated first quarter net income to $103,000, or $0.01 per share, from previously reported net income of $3.7 million, or $0.31 per share.
Book value per share was $16.12 at September 30, 2007, and $16.09 at September 30, 2006. Shareholders' equity was $191.8 million and $190.9 million at September 30, 2007 and 2006, respectively.
2007 Expectations
Expectations for the fourth quarter of 2007 are for net income to be in the range of $0.26 - $0.30 per diluted share. The fourth quarter estimate is revised from the previously reported range of $0.31 - $0.35 based on a projected increase of $1.0 million in the allowance for loan losses. The increase in the provision to $2.0 million from the previous estimate of $1.0 million is equal to approximately $0.05 per share. Cadence reported net income of $0.36 per diluted share in the fourth quarter of 2006.
Cadence expects earnings for 2007 to be in the range of $0.79 to $0.83 per diluted share compared with $1.37 reported in 2006.
The estimate includes an increase of 15.2% in the estimated average shares outstanding for 2007 compared with 2006. The additional shares are attributable to the $50.2 million common stock offering completed in May 2006 and the acquisition of SunCoast Bancorp in August 2006. Fully diluted shares are estimated to be 11,896,000 in 2007 compared with 10,329,000 in 2006. The projections anticipate continued loan growth, a slowing of margin compression and no significant changes in loan quality.
Conference Call
Cadence Financial Corporation will provide an on-line, real-time webcast and rebroadcast of its third quarter results conference call to be held tomorrow, October 19, 2007. The live broadcast will be available on-line at www.cadencebanking.com under investor information as well as www.investorcalendar.com beginning at 10:00 a.m. (Eastern Time). The on-line replay will follow immediately and continue for 30 days.
About Cadence Financial Corporation
Cadence Financial Corporation is a $2.0 billion financial holding company providing full financial services, including banking, trust services, mortgage services, insurance and investment products in Mississippi, Tennessee, Alabama, Florida and Georgia. Cadence's stock is listed on the NASDAQ Global Select Market under the symbol CADE.
Forward-Looking Statements
This press release contains statements that are forward-looking as defined within the Private Securities Litigation Reform Act of 1995. These forward-looking statements are provided to assist in the understanding of anticipated future financial results. However, such forward-looking statements involve risks and uncertainties (including uncertainties relating to interest rates, management and operation of acquired operations and general market risks) that may cause actual results to differ materially from those in such statements. For a discussion of certain factors that may cause such forward-looking statements to differ materially from the Company's actual results, see the Company's Annual Report on Form 10-K for the year ended December 31, 2006, and other reports filed with the Securities and Exchange Commission. Cadence Financial Corporation is not responsible for updating the information contained in this press release beyond the published date, or for changes made to this document by wire services or Internet services.
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| CADENCE FINANCIAL CORPORATION | ||||||||
| CONSOLIDATED STATEMENTS OF CONDITION | ||||||||
| SEPTEMBER 30, | ||||||||
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| (In thousands, except share data) | ||||||||
| Â | 2007 | Â | Â | 2006 | Â | |||
| ASSETS: | ||||||||
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| Cash and Due From Banks | $ | 40,714 | $ | 42,596 | ||||
| Interest Bearing Deposits Due From Banks | Â | 6,782 | Â | Â | 9,458 | Â | ||
| Total Cash and Due From Banks | 47,496 | 52,054 | ||||||
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| Securities: | ||||||||
| Securities Available-for-Sale | 415,407 | 454,063 | ||||||
| Securities Held-to-Maturity | Â | 22,929 | Â | Â | 23,563 | Â | ||
| Total Securities | 438,336 | 477,626 | ||||||
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Federal Funds Sold and Securities Purchased Under Agreements To Resell | 704 | 2,057 | ||||||
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| Other Earning Assets | 18,070 | 17,345 | ||||||
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| Loans | 1,323,473 | 1,098,889 | ||||||
| Less: Allowance for Loan Losses | Â | (13,078 | ) | Â | (10,813 | ) | ||
| Net Loans | 1,310,395 | 1,088,076 | ||||||
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| Premises and Equipment, Net | 34,380 | 27,620 | ||||||
| Interest Receivable | 14,260 | 11,151 | ||||||
| Other Real Estate Owned | 9,661 | 4,989 | ||||||
| Goodwill and Other Intangibles | 70,024 | 60,406 | ||||||
| Other Assets | Â | 22,766 | Â | Â | 21,936 | Â | ||
| Total Assets | $ | 1,966,092 | Â | $ | 1,763,260 | Â | ||
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| LIABILITIES AND SHAREHOLDERS' EQUITY: | ||||||||
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| Noninterest-Bearing Deposits | $ | 178,536 | $ | 171,371 | ||||
| Interest-Bearing Deposits | Â | 1,212,089 | Â | Â | 1,152,575 | Â | ||
| Total Deposits | 1,390,625 | 1,323,946 | ||||||
| Interest Payable | 4,143 | 4,397 | ||||||
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Federal Funds Purchased and Securities Sold Under Agreements to Repurchase | 99,889 | 72,347 | ||||||
| Federal Home Loan Bank Borrowings | 230,567 | 123,233 | ||||||
| Subordinated Debentures | 37,114 | 37,114 | ||||||
| Other Liabilities | Â | 11,972 | Â | Â | 11,277 | Â | ||
| Total Liabilities | 1,774,310 | 1,572,314 | ||||||
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| SHAREHOLDERS' EQUITY: | ||||||||
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Common Stock - $1 Par Value, Authorized 50,000,000 shares, Issued - 11,894,932 Shares at September 30, 2007 and 11,868,682 Shares at September 30, 2006 | 11,895 | 11,869 | ||||||
| Surplus and Undivided Profits | 183,550 | 184,816 | ||||||
| Accumulated Other Comprehensive Income (Loss) | Â | (3,663 | ) | Â | (5,739 | ) | ||
| Total Shareholders' Equity | Â | 191,782 | Â | Â | 190,946 | Â | ||
| Total Liabilities and Shareholders' Equity | $ | 1,966,092 | Â | $ | 1,763,260 | Â | ||
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| CADENCE FINANCIAL CORPORATION | |||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||
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| FOR THE THREE MONTHS | FOR THE NINE MONTHS | ||||||||||||||
| ENDED SEPTEMBER 30 | ENDED SEPTEMBER 30 | ||||||||||||||
| Â | 2007 | Â | 2006 | Â | Â | 2007 | Â | Â | 2006 | Â | |||||
| INTEREST INCOME: | |||||||||||||||
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| Interest and Fees on Loans | $ | 25,703 | $ | 19,574 | $ | 74,327 | $ | 51,577 | |||||||
Interest and Dividends on Investment Securities | 5,451 | 5,655 | 16,127 | 16,098 | |||||||||||
| Other Interest Income | Â | 122 | Â | 315 | Â | Â | 720 | Â | Â | 868 | Â | ||||
| Total Interest Income | 31,276 | 25,544 | 91,174 | 68,543 | |||||||||||
| INTEREST EXPENSE: | |||||||||||||||
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| Interest on Deposits | 12,321 | 9,732 | 37,728 | 24,170 | |||||||||||
| Interest on Borrowed Funds | Â | 4,315 | Â | 2,791 | Â | Â | 10,767 | Â | Â | 7,524 | Â | ||||
| Total Interest Expense | Â | 16,636 | Â | 12,523 | Â | Â | 48,495 | Â | Â | 31,694 | Â | ||||
| Net Interest Income | 14,640 | 13,021 | 42,679 | 36,849 | |||||||||||
| Provision for Loan Losses | Â | 3,150 | Â | (72 | ) | Â | 5,279 | Â | Â | 1,156 | Â | ||||
Net Interest Income After Provision for Loan Losses | 11,490 | 13,093 | 37,400 | 35,693 | |||||||||||
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| OTHER INCOME: | |||||||||||||||
| Service Charges on Deposit Accounts | 2,394 | 2,359 | 6,890 | 6,587 | |||||||||||
| Trust Department Income | 594 | 551 | 1,821 | 1,662 | |||||||||||
| Insurance Commission and Fee Income | 1,219 | 1,238 | 3,834 | 3,462 | |||||||||||
| Mortgage Loan Fee Income | 497 | 225 | 1,309 | 548 | |||||||||||
| Other Non-Interest Income | 1,052 | 1,438 | 2,913 | 3,672 | |||||||||||
| Gains (Losses) on Securities - Net | 43 | 2 | (89 | ) | 21 | ||||||||||
| Impairment Loss on Securities | Â | - | Â | (2,025 | ) | Â | (5,097 | ) | Â | (2,025 | ) | ||||
| Total Other Income | Â | 5,799 | Â | 3,788 | Â | Â | 11,581 | Â | Â | 13,927 | Â | ||||
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| OTHER EXPENSE: | |||||||||||||||
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| Salaries and Employee Benefits | 7,894 | 7,350 | 23,395 | 20,939 | |||||||||||
| Net Premises and Fixed Asset Expense | 2,134 | 1,717 | 6,308 | 4,911 | |||||||||||
| Other Operating Expense | Â | 3,784 | Â | 3,593 | Â | Â | 11,221 | Â | Â | 10,278 | Â | ||||
| Total Other Expense | Â | 13,812 | Â | 12,660 | Â | Â | 40,924 | Â | Â | 36,128 | Â | ||||
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| Income Before Income Taxes | 3,477 | 4,221 | 8,057 | 13,492 | |||||||||||
| Applicable Income Tax Expense | Â | 860 | Â | 1,111 | Â | Â | 1,727 | Â | Â | 3,638 | Â | ||||
| Net Income | $ | 2,617 | $ | 3,110 | Â | $ | 6,330 | Â | $ | 9,854 | Â | ||||
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| Earnings Per Share: | |||||||||||||||
| Basic | $ | 0.22 | $ | 0.27 | $ | 0.53 | $ | 1.01 | |||||||
| Diluted | $ | 0.22 | $ | 0.27 | Â | $ | 0.53 | Â | $ | 1.01 | Â | ||||
| Average Weighted Shares: | |||||||||||||||
| Primary | 11,897,475 | 11,387,660 | 11,895,745 | 9,797,105 | |||||||||||
| Diluted | 11,919,884 | 11,390,715 | 11,917,591 | 9,804,059 | |||||||||||
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| CADENCE FINANCIAL CORPORATION | ||||||||
| FINANCIAL HIGHLIGHTS | ||||||||
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| (in thousands, except per share data) | ||||||||
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| FOR THE THREE MONTHS ENDED SEPTEMBER 30: | 2007 | 2006 | ||||||
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| Net Earnings | $ | 2,617 | $ | 3,110 | ||||
| Basic and Diluted Earnings Per Share | 0.22 | 0.27 | ||||||
| Cash Dividends Per Share | 0.25 | 0.25 | ||||||
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| ANNUALIZED RETURNS | ||||||||
| Return on Average Assets | 0.5 | % | 0.7 | % | ||||
| Return on Average Equity | 5.5 | % | 7.0 | % | ||||
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| FOR THE NINE MONTHS ENDED SEPTEMBER 30: | 2007 | 2006 | ||||||
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| Net Earnings | $ | 6,330 | $ | 9,854 | ||||
| Basic and Diluted Earnings Per Share | 0.53 | 1.01 | ||||||
| Cash Dividends Per Share | 0.75 | 0.75 | ||||||
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| ANNUALIZED RETURNS | ||||||||
| Return on Average Assets | 0.4 | % | 0.8 | % | ||||
| Return on Average Equity | 4.4 | % | 8.9 | % | ||||
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| SELECTED BALANCES AT SEPTEMBER 30: | 2007 | 2006 | ||||||
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| Total Assets | $ | 1,966,092 | $ | 1,763,260 | ||||
Deposits and Securities Sold Under Agreements to Repurchase | 1,430,564 | 1,359,243 | ||||||
| Loans | 1,323,473 | 1,098,889 | ||||||
| Total Securities | 438,336 | 477,626 | ||||||
| Shareholders' Equity | 191,782 | 190,946 | ||||||
| Market Price Per Share | 17.60 | 20.27 | ||||||
| Book Value Per Share | 16.12 | 16.09 | ||||||
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| CADENCE FINANCIAL CORPORATION | ||||||||||||
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| (amounts in thousands) | ||||||||||||
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| 9/30/2007 | 6/30/2007 | 9/30/2006 | ||||||||||
| LOAN BALANCES BY TYPE: | ||||||||||||
| Commercial and Industrial | $ | 233,507 | $ | 226,624 | $ | 233,662 | ||||||
| Personal | 33,437 | 32,313 | 33,756 | |||||||||
| Real Estate: | ||||||||||||
| Construction | 268,416 | 263,756 | 158,436 | |||||||||
| Commercial Real Estate | 570,047 | 530,832 | 465,649 | |||||||||
| Real Estate Secured by Residential Properties | 132,123 | 133,549 | 127,977 | |||||||||
| Mortgage | 36,362 | Â | 39,024 | Â | 45,164 | Â | ||||||
| Total Real Estate | 1,006,948 | 967,161 | 797,226 | |||||||||
| Other | 49,581 | Â | 57,808 | Â | 34,245 | Â | ||||||
| Total | $ | 1,323,473 | Â | $ | 1,283,906 | Â | $ | 1,098,889 | Â | |||
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| ASSET QUALITY DATA: | ||||||||||||
| Nonaccrual Loans | $ | 5,818 | $ | 4,255 | $ | 1,466 | ||||||
| Loans 90+ Days Past Due | 4,652 | Â | 4,094 | Â | 1,568 | Â | ||||||
| Total Non-Performing Loans | 10,470 | 8,349 | 3,034 | |||||||||
| Other Real Estate Owned | 9,661 | Â | 8,542 | Â | 4,989 | Â | ||||||
| Total Non-Performing Assets | $ | 20,131 | $ | 16,891 | $ | 8,023 | ||||||
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| Non-Performing Loans to Total Loans | 0.8 | % | 0.7 | % | 0.3 | % | ||||||
| Non-Performing Assets to Total Loans | 1.5 | % | 1.3 | % | 0.7 | % | ||||||
| Allowance for Loan Losses to Non-Performing Loans | 124.9 | % | 145.2 | % | 356.4 | % | ||||||
| Allowance for Loan Losses to Total Loans | 1.0 | % | 0.9 | % | 1.0 | % | ||||||
| Classified Assets to Capital | 17.9 | % | 17.8 | % | 10.2 | % | ||||||
| Classified Loans to Total Loans | 1.9 | % | 2.0 | % | 1.3 | % | ||||||
| Loans 30+ Days Past Due to Total Loans | 1.5 | % | 1.4 | % | 0.9 | % | ||||||
| Net Chargeoffs to Average Loans YTD | 0.4 | % | 0.2 | % | 0.1 | % | ||||||
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| NET CHARGEOFFS FOR QUARTER | $ | 2,194 | $ | 1,684 | $ | 631 | ||||||
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| INTANGIBLE ASSET AMORTIZATION FOR QUARTER | $ | 319 | $ | 335 | $ | 264 | ||||||
| CADENCE FINANCIAL CORPORATION | ||||||||||||||||
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| LOANS AND DEPOSITS BY STATE/REGION | ||||||||||||||||
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| AS OF SEPTEMBER 30, 2007: | ||||||||||||||||
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| MISSISSIPPI | Â | TUSCALOOSA | Â | BIRMINGHAM | Â | MEMPHIS | Â | MIDDLE TN | Â | FLORIDA | Â | GEORGIA | Â | TOTAL | ||
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| LOANS | 31% | 10% | 6% | 29% | 11% | 10% | 4% | 100% | ||||||||
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| DEPOSITS | 62% | 11% | 1% | 14% | 3% | 6% | 3% | 100% | ||||||||
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| AS OF SEPTEMBER 30, 2006: | ||||||||||||||||
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| MISSISSIPPI | Â | TUSCALOOSA | Â | BIRMINGHAM | Â | MEMPHIS | Â | MIDDLE TN | Â | FLORIDA | Â | GEORGIA | Â | TOTAL | ||
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| LOANS | 40% | 10% | 5% | 30% | 5% | 11% | 0% | 100% | ||||||||
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| DEPOSITS | 63% | 14% | 0% | 16% | 1% | 7% | 0% | 100% | ||||||||
| REAL ESTATE LOAN BALANCES BY STATE/REGION - LINKED QUARTERS | |||||||||
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9/30/2007 | 6/30/2007 | ||||||||
Balance | % of Total | Balance | % of Total | ||||||
| Mississippi | $ 242,291 | 24% | $ 239,026 | 25% | |||||
| Tuscaloosa | 107,330 | 11% | 89,764 | 9% | |||||
| Birmingham | 64,828 | 6% | 62,502 | 6% | |||||
| Memphis | 247,264 | 25% | 242,891 | 25% | |||||
| Middle Tennessee | 128,494 | 13% | 108,205 | 11% | |||||
| Florida | 121,525 | 12% | 121,131 | 13% | |||||
| Georgia | 49,793 | 5% | 57,584 | 6% | |||||
| Administration | 45,423 | Â | 5% | 46,058 | Â | 5% | |||
| Total | $ 1,006,948 | Â | 100% | $ 967,161 | Â | 100% | |||
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| ANALYSIS OF NET INTEREST EARNINGS | |||||||||||||||
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| (amounts in thousands) | |||||||||||||||
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| Average Balance | |||||||||||||||
| Quarter Ended | Quarter Ended | Quarter Ended | Nine Months Ended | Nine Months Ended | |||||||||||
| Â | 9/30/07 | Â | 9/30/06 | Â | 6/30/07 | Â | 9/30/07 | Â | 9/30/06 | ||||||
| EARNING ASSETS: | |||||||||||||||
| Net loans | $ | 1,306,073 | $ | 1,002,236 | $ | 1,260,775 | $ | 1,268,647 | $ | 914,413 | |||||
Federal funds sold and other interest-bearing assets | 11,796 | 26,883 | 17,275 | 18,343 | 22,765 | ||||||||||
| Securities: | |||||||||||||||
| Taxable | 336,143 | 358,400 | 344,799 | 337,688 | 342,151 | ||||||||||
| Tax-exempt | Â | 102,541 | Â | 118,212 | Â | 104,056 | Â | 104,014 | Â | 118,792 | |||||
| Totals | Â | 1,756,553 | Â | 1,505,731 | Â | 1,726,905 | Â | 1,728,692 | Â | 1,398,121 | |||||
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| INTEREST-BEARING LIABILITIES: | |||||||||||||||
| Interest-bearing deposits | 1,225,884 | 1,089,559 | 1,257,852 | 1,250,542 | 1,011,971 | ||||||||||
Borrowed funds, federal funds purchased and securities sold under agreements to repurchase and other interest-bearing liabilities | Â | 331,630 | Â | 208,970 | Â | 258,124 | Â | 274,674 | Â | 202,486 | |||||
| Totals | Â | 1,557,514 | Â | 1,298,529 | Â | 1,515,976 | Â | 1,525,216 | Â | 1,214,457 | |||||
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| Net amounts | $ | 199,039 | $ | 207,202 | $ | 210,929 | $ | 203,476 | $ | 183,664 | |||||
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| Interest For | |||||||||||||||
| Quarter Ended | Quarter Ended | Quarter Ended | Nine Months Ended | Nine Months Ended | |||||||||||
| Â | 9/30/07 | Â | 9/30/06 | Â | 6/30/07 | Â | 9/30/07 | Â | 9/30/06 | ||||||
| EARNING ASSETS: | |||||||||||||||
| Net loans | $ | 25,703 | $ | 19,574 | $ | 24,652 | $ | 74,327 | $ | 51,577 | |||||
Federal funds sold and other interest-bearing assets | 122 | 315 | 283 | 720 | 868 | ||||||||||
| Securities: | |||||||||||||||
| Taxable | 4,377 | 4,381 | 4,410 | 12,877 | 12,340 | ||||||||||
| Tax-exempt | Â | 1,074 | Â | 1,274 | Â | 1,088 | Â | 3,250 | Â | 3,758 | |||||
| Totals | Â | 31,276 | Â | 25,544 | Â | 30,433 | Â | 91,174 | Â | 68,543 | |||||
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| INTEREST-BEARING LIABILITIES: | |||||||||||||||
| Interest-bearing deposits | 12,321 | 9,732 | 12,672 | 37,728 | 24,170 | ||||||||||
Borrowed funds, federal funds purchased and securities sold under agreements to repurchase and other interest-bearing liabilities | Â | 4,315 | Â | 2,791 | Â | 3,421 | Â | 10,767 | Â | 7,524 | |||||
| Totals | Â | 16,636 | Â | 12,523 | Â | 16,093 | Â | 48,495 | Â | 31,694 | |||||
| Â | |||||||||||||||
| Net amounts | $ | 14,640 | $ | 13,021 | $ | 14,340 | $ | 42,679 | $ | 36,849 | |||||
| Â | Â | Â | Â | Â | |||||||||||
| CADENCE FINANCIAL CORPORATION | |||||||||||||||
| ANALYSIS OF NET INTEREST EARNINGS | |||||||||||||||
| Â | |||||||||||||||
| (amounts in thousands) | |||||||||||||||
| Yields Earned | |||||||||||||||
| And Rates Paid (%) | |||||||||||||||
| Quarter Ended | Quarter Ended | Quarter Ended | Nine Months Ended | Nine Months Ended | |||||||||||
| Â | 9/30/07 | Â | 9/30/06 | Â | 6/30/07 | Â | 9/30/07 | Â | 9/30/06 | ||||||
| EARNING ASSETS: | |||||||||||||||
| Net loans | 7.81 | 7.75 | 7.84 | 7.83 | 7.54 | ||||||||||
Federal funds sold and other interest-bearing assets | 4.10 | 4.65 | 6.57 | 5.25 | 5.10 | ||||||||||
| Securities: | |||||||||||||||
| Taxable | 5.17 | 4.85 | 5.13 | 5.10 | 4.82 | ||||||||||
| Tax-exempt | Â | 4.16 | Â | 4.27 | Â | 4.19 | Â | 4.18 | Â | 4.23 | |||||
| Totals | Â | 7.06 | Â | 6.73 | Â | 7.07 | Â | 7.05 | Â | 6.55 | |||||
| Â | |||||||||||||||
| INTEREST-BEARING LIABILITIES: | |||||||||||||||
| Interest-bearing deposits | 3.99 | 3.54 | 4.04 | 4.03 | 3.19 | ||||||||||
Borrowed funds, federal funds purchased and securities sold under agreements to repurchase and other interest-bearing liabilities | Â | 5.16 | Â | 5.30 | Â | 5.32 | Â | 5.24 | Â | 4.97 | |||||
| Totals | Â | 4.24 | Â | 3.87 | Â | 4.26 | Â | 4.25 | Â | 3.49 | |||||
| Â | |||||||||||||||
| Net margin | Â | 3.31 | Â | 3.43 | Â | 3.33 | Â | 3.30 | Â | 3.52 | |||||
| Â | |||||||||||||||
Note: Yields on a tax equivalent basis would be: | |||||||||||||||
| Tax-exempt securities | Â | 6.39 | Â | 6.58 | Â | 6.45 | Â | 6.43 | Â | 6.51 | |||||
| Total earning assets | Â | 7.35 | Â | 6.99 | Â | 7.28 | Â | 7.19 | Â | 6.75 | |||||
| Net margin | Â | 3.44 | Â | 3.61 | Â | 3.47 | Â | 3.44 | Â | 3.72 | |||||
| Â | |||||||||||||||
| Tax equivalent income | |||||||||||||||
| (in thousands) | $ | 578 | $ | 686 | $ | 586 | $ | 1,750 | $ | 2,024 | |||||
