WARREN, Ohio, July 18 /PRNewswire-FirstCall/ -- First Place Financial Corp.
Highlights
- Fiscal year 2006 net income and core earnings reached record levels;
net income was $23.0 million, up 21.7% and core earnings were
$24.5 million up 14.6%.
- Fiscal 2006 earnings per share and core earnings per share also reached
record levels; diluted EPS was $1.55 up 19.2% and core diluted EPS was
$1.65 up 13.0% over the prior year.
- The acquisition of Northern Savings completed June 27, 2006, added
approximately $360 million in assets and accounted for 14.3% in asset
growth for the year.
- Organic asset growth was $256 million and contributed 10.3% of the
total annual asset growth of 24.6%.
- Net charge-offs to average loans were 0.12% for the current year.
- Commercial loans grew 19.6% during the year. Organic growth accounted
for 15.4% and the Northern acquisition 4.2%.
- The Board of Directors declared a $0.14 per share cash dividend.
Summary
First Place Financial Corp. reported record net income of $23.0 million for the year ended June 30, 2006, compared with $18.9 million for the year ended June 30, 2005, an increase of 21.7%. Diluted earnings per share were $1.55 for the current year compared with $1.30 for the prior year, an increase of 19.2%. Return on average equity for the current year was 9.32% compared with 8.29% for the prior year. On June 27, 2006, First Place completed its acquisition of The Northern Savings & Loan Company of Elyria, Ohio. As of the date of the acquisition, Northern Savings had approximately $360 million in assets and operated seven retail branches and one loan production office in Lorain County, Ohio.
Net income for the three months ended June 30, 2006, was $4.5 million compared with $6.3 million for the three months ended March 31, 2006 and $6.0 million for the three months ended June 30, 2005. The primary reasons for the decline in the current quarter compared with the preceding quarter and the prior year quarter were $2.2 million of merger costs which were expensed as of the date of the acquisition and $0.6 million in provision for loan losses, which was recorded to reflect a change in the approach to managing credit issues at Northern Savings and to conform Northern's credit policies and practices to First Place's. The $2.2 million of merger costs were $1.4 million, net of tax, and represented $0.10 per diluted share. The $0.6 million provision was $0.4 million, net of tax, and represented $0.03 per diluted share. Diluted earnings per share for the current quarter were $0.30 compared with $0.43 for the preceding quarter and $0.41 for the prior year quarter.
Core earnings are a supplementary financial measure computed using methods other than generally accepted accounting principles (GAAP) that excludes certain unusual or nonrecurring items of revenue or expense. Core earnings in the current quarter do not include the $1.4 million of after tax charges for merger costs. Core earnings were identical to GAAP earnings for the preceding quarter and the prior year quarter. Core earnings for the current year also exclude the previously mentioned $1.4 million after tax charge for merger costs. Core earnings in the prior year exclude a $3.4 million after tax charge for the impairment of securities and a $1.0 million tax-free credit for life insurance proceeds.
Core earnings for the year ended June 30, 2006, were $24.5 million compared with $21.3 million for the year ended June 30, 2005, or an increase of 14.6%. Core diluted earnings per share were $1.65 for the current year compared with $1.46 for the prior year, an increase of 13.0%. Core return on average equity for the current year was 9.89% compared with 9.36% for the prior year. For additional information on core earnings, see the Explanation of Certain Non-GAAP Measures on page four of this release and the Reconciliation of GAAP Net Income to Core Earnings on page eight.
Commenting on these results, Steven R. Lewis, President and CEO, stated, "We are extremely proud to be able to announce new record levels of earnings for the year whether measured by GAAP net income or core earnings. In spite of the challenges of a flattening yield curve and tough local competition for loans, we were able to achieve double digit percentage increases in net income, core earnings and organic asset growth. Our current quarter results reflect an investment in future growth potential in the form of $2.2 million in merger costs and the $0.6 million in provision for loan losses related to the Northern Savings acquisition. On an after tax basis these costs reduced our current quarter earnings by $1.8 million or $0.12 per share. However, we believe this acquisition was an excellent use of our resources to expand our presence in Lorain County and the Greater Cleveland Ohio area. We look forward to bringing expanded community banking services and products to Northern's existing customers and expanding our franchise into Western Cuyahoga County."
Revenue
Net interest income for the fourth quarter of fiscal 2006 was $20.3 million, an increase of 5.8% over the fourth quarter of fiscal 2005. This increase was the result of the benefit of an 8.1% increase in average earning assets from the fourth quarter of fiscal 2006 compared with the fourth quarter of fiscal 2005 partially offset by a decline in the net interest margin to 3.29% from 3.35% over the same periods. The continued flattening and occasional inversion of the yield curve has put downward pressure on the net interest margin.
Noninterest income for the fourth quarter of fiscal 2006 was $7.4 million, an increase of $1.3 million or 21.4% over the same period in the prior year. This increase was primarily due to a $0.7 million increase in income related to loan servicing and a $0.6 million increase in other income-bank partially offset by a decline of $0.3 million in gain on sale of loans. Resolution of certain contingencies in the March 2006 sale of servicing rights resulted in additional gain of $0.3 million, and slower payoff rates on serviced loans resulted in $0.4 additional income from loan servicing. Other income-bank also increased due to a $0.4 million gain from recognizing an equity interest in a credit card servicer resulting from a conversion to the stock form of ownership.
Net gains on sale of loans was $1.2 million for the quarter ended June 30, 2006 a $0.3 million or 20.0% decline from a gain of $1.5 million for the quarter ended June 30, 2005. The decrease in gain was due to a decrease in the volume of loans sold to $208 million for the current quarter compared with $338 million for the same quarter in the prior year.
Noninterest Expense
Noninterest expense for the fourth quarter of fiscal year 2006 was $18.8 million, an increase of $2.8 million or 17.2% compared with the fourth quarter of fiscal year 2005. The predominant cause of this increase was $2.2 million in expenses for merger, restructuring and integration costs related to the Northern Savings acquisition. These costs were $0.10 per diluted share after including the impact of federal income taxes. The remainder of the increase was due to a $0.5 million increase in franchise taxes. Noninterest expense as a percent of average assets was 2.79% for the quarter ended June 30, 2006 up from 2.58% for the preceding quarter and 2.58% from the same quarter in the prior year. The efficiency ratio for the quarter ended June 30, 2006 was 67.3%, up from 61.6% in the preceding quarter and 63.1% in the prior year quarter. The unfavorable change in both of theses ratios was due to the $2.2 million of merger charges recorded in the current quarter.
Excluding current quarter merger charges, core noninterest expense for the current quarter was $16.6 million, compared with $16.7 million in the preceding quarter and $16.0 million in the same quarter in the prior year. Core noninterest expense as a percent of average assets for the quarter ended June 30, 2006 was 2.47% down from 2.58% for the preceding quarter and from 2.58% for the same quarter in the prior year. Similar improvement occurred in the core efficiency ratio for the quarter ended June 30, 2006, which was 59.5%, down from 61.6% in the preceding quarter and down from 63.1% in the same quarter in the prior year. Mr. Lewis added, "We continue to make steady progress in controlling noninterest expense by growing those expenses more slowly than we are growing assets. We anticipate additional efficiencies with the integration of Northern Savings into our existing system. However, this integration will not be fully complete until data processing systems are integrated during the first quarter of calendar 2007."
Asset Quality
Nonperforming assets were $20.7 million at June 30, 2006, or 0.66% of total assets compared with $19.9 million or 0.75% of total assets at March 31, 2006. Net charge-offs for the quarter ended June 30, 2006 were $0.7 million compared with $0.5 million for the quarter ended March 31, 2006. That represented an annualized ratio of net charge-offs to average loans of 0.13% for the fourth fiscal quarter of fiscal 2006 compared with 0.09% for the third quarter of fiscal 2006. For fiscal 2006 the ratio of net charge-offs to average loans was 0.12% compared with 0.11% for the prior year. The allowance for loan losses increased $2.1 million to $22.3 million at June 30, 2006, from $20.2 million at March 31, 2006. The increase was composed of $0.5 million existing allowance acquired with Northern Savings, net charge-offs of $0.7 million, a provision for loan losses of $1.7 million related to First Place loans and a $0.6 million provision for loan losses related to Northern Savings loans. The $0.6 million in provision for loans losses was recorded to reflect a change in the approach to managing credit issues at Northern Savings and to conform Northern Savings' credit policies and practices to First Place's. The ratio of the allowance for loan losses to total loans was 0.95% at June 30, 2006, down from 0.98% at March 31, 2006 and is reflective of the addition of Northern Savings loans which contain a low level of nonperforming loans and low level of charge-offs historically. Mr. Lewis noted that, "The current year ratio of net charge-offs to average loans of 0.12% is excellent. I congratulate our personnel in the credit and collection functions on these results."
Balance Sheet Activity
Assets were $3.113 billion at June 30, 2006, an increase of $466 million during the fourth quarter of fiscal 2006 and $614 million for all of fiscal 2006, both primarily due to the addition of $360 million in assets from the Northern Savings acquisition. Organic asset growth for the fiscal year was $256 million or 10.3% contributing to an overall asset growth of 24.6%. Portfolio loans totaled $2.351 billion at June 30, 2006, an increase of $520 million from June 30, 2005, or growth of 28.4%. Organic growth accounted for $338 million or 18.5% while the Northern Savings acquisition accounted for the remaining $182 million or 9.9%. Northern Savings' loan portfolio of $182 million was predominately mortgage loans accounting for the increase in mortgage and construction loans as a percent of total loans and the decrease of commercial and consumer loans as a percent of total loans. Commercial loans increased $140 million during the fiscal year, or 19.6%, to $856 million including $30 million in commercial loans acquired. Commercial loans now account for 36.4% of the loan portfolio. During the fiscal year, mortgage and construction loans increased $318 million, or 39.4% to $1.124 billion including $147 million of loans acquired. Consumer loans increased $61 million during the fiscal year or 20.0% to $371 million including $5 million of loans acquired.
Deposits totaled $2.061 billion at June 30, 2006, an increase of $351 million since June 30, 2005. This increase was composed of $254 million from the acquisition of Northern Savings, a $114 million increase in retail deposits and a $17 million decrease in brokered deposits. Organic growth of retail deposits was 7.1% during the current fiscal year.
Shareholders' equity remains strong; it grew $75 million during the year. Approximately $58 million of that growth was due to the stock issued to acquire Northern Savings. At June 30, 2006, equity as a percent of assets was 10.01%, up from 9.47% at June 30, 2005 and which was higher than at any quarter end during the year. There were no purchases of treasury stock during the current year although board authorization to repurchase shares is in place through March 2007 should the internal metrics for the acquisition of treasury shares be met.
Board Actions
At its regular meeting held July 18, 2006, the Board of Directors declared a per share cash dividend of $0.14 payable on August 10, 2006, to shareholders of record as of the close of business on July 27, 2006.
About First Place Financial Corp.
First Place Financial Corp., a $3.1 billion financial services holding company based in Warren, Ohio, is the largest publicly-traded thrift headquartered in Ohio. First Place Financial Corp. operates 33 retail locations, 2 business financial service centers and 16 loan production offices through First Place Bank, Northern Savings & Loan Company and the Franklin Bank division of First Place Bank. Additional affiliates of First Place Financial Corp. include First Place Insurance Agency, Ltd.; Coldwell Banker First Place Real Estate, Ltd.; TitleWorks Agency, LLC and APB Financial Group, Ltd., an employee benefit consulting firm and specialists in wealth management services for businesses and consumers. Information about First Place Financial Corp. may be found on the Company's web site: http://www.firstplacebank.com/.
Explanation of Certain Non-GAAP Measures
This press release contains certain financial information determined by methods other than in accordance with Generally Accepted Accounting Principles (GAAP). Specifically, we have provided financial measures that are based on core earnings rather than net income. Ratios and other financial measures with the word "core" in their title were computed using core earnings rather than net income. Core earnings excludes merger, integration and restructuring expense; extraordinary income or expense; income or expense from discontinued operations; and income, expense, gains and losses that are not reflective of ongoing operations or that we do not expect to reoccur. Similarly, core noninterest expense or core noninterest income exclude the pretax impact of those same items that impact noninterest income or noninterest expense. We believe that this information is useful to both investors and to management and can aid them in understanding the Company's current performance, performance trends and financial condition. While core earnings can be useful in evaluating current performance and projecting current trends into the future, we do not believe that core earnings are a substitute for GAAP net income. We encourage investors and others to use core earnings as a supplemental tool for analysis and not as a substitute for GAAP net income. Our non-GAAP measures may not be comparable to the non-GAAP measures of other companies. In addition, future results of operations may include nonrecurring items that would not be included in core earnings. A reconciliation from GAAP net income to the non-GAAP measure of core earnings is shown in the consolidated financial highlights on page eight.
Forward-Looking Statements
When used in this press release, or future press releases or other public or shareholder communications, in filings by First Place Financial Corp. (the Company) with the Securities and Exchange Commission or in oral statements made with the approval of an authorized executive officer, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the Company's actual results to be materially different from those indicated. Such statements are subject to certain risks and uncertainties including changes in economic conditions in the market areas the Company conducts business, which could materially impact credit quality trends, changes in laws, regulations or policies of regulatory agencies, fluctuations in interest rates, demand for loans in the market areas the Company conducts business, and competition, that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The Company wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
FIRST PLACE FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three months ended
June 30, Percent
(Dollars in thousands, 2006 2005 Change
except share data)
Interest income $ 40,185 $ 33,133 21.3 %
Interest expense 19,934 13,994 42.4
Net interest income 20,251 19,139 5.8
Provision for loan losses 2,317 925 150.5
Net interest income after
provision for loan losses 17,934 18,214 (1.5)
Noninterest income
Service charges 1,427 1,293 10.4
Net gains (losses) on
sale of securities 2 (77) N/M
Impairment of securities - - -
Net gains on sale of loans 1,196 1,495 (20.0)
Gain on sale of loan
servicing rights 290 - N/M
Loan servicing income (loss) 221 (136) (262.5)
Other income - bank 2,135 1,575 35.6
Other income - non-bank 2,101 1,922 9.3
Total noninterest income 7,372 6,072 21.4
Noninterest expense
Salaries and employee
benefits 8,089 7,868 2.8
Occupancy and equipment 2,743 2,434 12.7
Professional fees 683 851 (19.7)
Loan expenses 777 823 (5.6)
Marketing 406 553 (26.6)
Merger, integration and
restructuring 2,173 - N/M
Franchise taxes 481 8 N/M
Amortization of intangible
assets 886 964 (8.1)
Other 2,562 2,534 1.1
Total noninterest expense 18,800 16,035 17.2
Income before income taxes 6,506 8,251 (21.1)
Provision for income taxes 2,001 2,296 (12.8)
Net income $ 4,505 $ 5,955 (24.3)%
SHARE DATA:
Basic earnings per share $0.31 0.41 (24.4)%
Diluted earnings per share $0.30 0.41 (26.8)
Cash dividends per share $0.14 0.14 -
Average shares outstanding
- basic 14,703,935 14,399,184 2.1
Average shares outstanding
- diluted 14,950,054 14,606,810 2.3
FIRST PLACE FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Year ended
June 30, Percent
(Dollars in thousands, 2006 2005 Change
except share data)
Interest income $ 149,053 $ 121,502 22.7 %
Interest expense 70,639 49,490 42.7
Net interest income 78,414 72,012 8.9
Provision for loan losses 5,875 3,509 67.4
Net interest income after
provision for loan losses 72,539 68,503 5.9
Noninterest income
Service charges 5,505 5,238 5.1
Net gains (losses) on
sale of securities (943) 91 N/M
Impairment of securities - (5,246) (100.0)
Net gains on sale of loans 5,922 5,853 1.2
Gain on sale of loan
servicing rights 1,841 - N/M
Loan servicing income (loss) 1,302 38 N/M
Other income - bank 7,408 7,024 5.5
Other income - non-bank 7,950 6,881 15.5
Total noninterest income 28,985 19,879 45.8
Noninterest expense
Salaries and employee
benefits 32,654 29,575 10.4
Occupancy and equipment 10,089 9,699 4.0
Professional fees 2,816 2,780 1.3
Loan expenses 2,716 2,419 12.3
Marketing 2,005 2,314 (13.4)
Merger, integration and
restructuring 2,173 - N/M
Franchise taxes 1,407 1,115 26.2
Amortization of intangible
assets 3,655 3,880 (5.8)
Other 10,635 9,764 8.9
Total noninterest expense 68,150 61,546 10.7
Income before income taxes 33,374 26,836 24.4
Provision for income taxes 10,330 7,898 30.8
Net income $ 23,044 $ 18,938 21.7 %
SHARE DATA:
Basic earnings per share $1.58 1.32 19.7 %
Diluted earnings per share $1.55 1.30 19.2
Cash dividends per share $0.56 0.56 -
Average shares outstanding
- basic 14,564,909 14,387,179 1.2
Average shares outstanding
- diluted 14,821,366 14,623,019 1.4
N/M - Not meaningful
FIRST PLACE FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
June 30, Mar 31, Dec 31,
2006 2006 2005
(Dollars in thousands) (Unaudited) (Unaudited) (Unaudited)
ASSETS
Cash and due from banks $ 72,906 $ 60,513 $ 70,153
Interest-bearing deposits
in other banks 4,605 4,600 -
Securities available for sale 302,994 266,170 286,864
Loans held for sale 154,799 59,015 83,754
Loans
Mortgage and construction 1,123,911 916,479 884,123
Commercial 856,129 789,992 775,782
Consumer 370,744 358,004 345,643
Total loans 2,350,784 2,064,475 2,005,548
Less allowance for
loan losses 22,319 20,170 19,617
Loans, net 2,328,465 2,044,305 1,985,931
Federal Home Loan Bank stock 32,616 27,518 31,281
Premises and equipment, net 35,485 25,428 24,128
Goodwill 88,009 56,207 55,173
Core deposit and other intangibles 17,405 12,525 13,413
Other assets 75,926 90,874 75,834
Total assets $ 3,113,210 $ 2,647,155 $ 2,626,531
LIABILITIES
Deposits
Non-interest bearing checking $224,738 $223,647 $251,624
Interest bearing checking 140,752 117,586 122,219
Savings 242,178 205,284 196,754
Money market 511,482 442,061 450,746
Certificates of deposit 941,597 759,784 743,738
Total deposits 2,060,747 1,748,362 1,765,081
Securities sold under
agreements to repurchase 44,013 39,911 39,095
Borrowings 603,906 515,016 482,944
Junior subordinated debentures
owed to unconsolidated
subsidiary trusts 61,857 61,857 61,857
Other liabilities 31,113 29,992 32,363
Total liabilities 2,801,636 2,395,138 2,381,340
SHAREHOLDERS' EQUITY 311,574 252,017 245,191
Total liabilities and
shareholders equity $3,113,210 $2,647,155 $2,626,531
Sept 30, June 30,
2005 2005
(Unaudited)
ASSETS
Cash and due from banks $64,759 $52,549
Interest-bearing deposits
in other banks - -
Securities available for sale 294,763 296,314
Loans held for sale 138,939 145,053
Loans
Mortgage and construction 807,745 806,294
Commercial 742,511 715,903
Consumer 330,177 308,924
Total loans 1,880,433 1,831,121
Less allowance for
loan losses 19,194 18,266
Loans, net 1,861,239 1,812,855
Federal Home Loan Bank stock 30,922 30,621
Premises and equipment, net 22,354 21,367
Goodwill 55,173 55,076
Core deposit and other intangibles 14,337 15,282
Other assets 77,806 69,826
Total assets $2,560,292 $2,498,943
LIABILITIES
Deposits
Non-interest bearing checking $228,642 $235,840
Interest bearing checking 118,667 110,774
Savings 193,052 195,203
Money market 452,478 441,134
Certificates of deposit 62,066 726,388
Total deposits 1,754,905 1,709,339
Securities sold under agreements
to repurchase 38,377 36,946
Borrowings 430,752 455,206
Junior subordinated debentures
owed to unconsolidated
subsidiary trusts 61,857 30,929
Other liabilities 32,932 29,867
Total liabilities 2,318,823 2,262,287
SHAREHOLDERS' EQUITY 241,469 236,656
Total liabilities and
shareholders equity $2,560,292 $2,498,943
FIRST PLACE FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
As of or for the three months ended
6/30/06 3/31/06 12/31/05 9/30/05 6/30/05
(Dollars in thousands 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
except per share data) FY 2006 FY 2006 FY 2006 FY 2006 FY 2005
EARNINGS (GAAP)
Tax equivalent net
interest income $20,565 19,305 19,876 19,650 19,358
Net interest income $20,251 19,080 19,652 19,431 19,139
Provision for loan losses $2,317 1,013 1,190 1,355 925
Noninterest income $7,372 7,904 6,807 6,902 6,072
Noninterest
expense $18,800 16,749 16,535 16,066 16,035
Net income $4,505 6,326 6,046 6,167 5,955
Basic earnings per share $0.31 0.43 0.42 0.43 0.41
Diluted earnings per share $0.30 0.43 0.41 0.42 0.41
PERFORMANCE RATIOS
(annualized) (GAAP)
Return on average
assets 0.67% 0.98% 0.93% 0.96% 0.96%
Return on average
equity 7.02% 10.30% 9.86% 10.23% 10.18%
Return on average
tangible assets 0.69% 1.00% 0.95% 0.99% 0.99%
Return on average
tangible equity 9.64% 14.22% 13.77% 14.46% 14.63%
Net interest margin,
fully tax equivalent 3.29% 3.17% 3.33% 3.35% 3.35%
Efficiency ratio 67.29% 61.56% 61.97% 60.51% 63.05%
Noninterest expense as a
percent of average assets 2.79% 2.58% 2.54% 2.51% 2.58%
RECONCILIATION OF NET
INCOME TO CORE EARNINGS
GAAP net income $4,505 6,326 6,046 6,167 5,955
Other than temporary
impairment of securities,
net of tax $- - - - -
Tax-free proceeds from
executive life insurance
policy $- - - - -
Merger, integration and
restructuring, net of tax $1,413 - - - -
Core earnings $5,918 6,326 6,046 6,167 5,955
CORE EARNINGS
Core earnings $5,918 6,326 6,046 6,167 5,955
Basic core earnings
per share $0.40 0.43 0.42 0.43 0.41
Core diluted earnings
per share $0.40 0.43 0.41 0.42 0.41
CORE PERFORMANCE RATIOS
(annualized)
Core return on
average assets 0.88% 0.98% 0.93% 0.96% 0.96%
Core return on
average equity 9.22% 10.30% 9.86% 10.23% 10.18%
Core return on average
tangible assets 0.90% 1.00% 0.95% 0.99% 0.99%
Core return on average
tangible equity 12.66% 14.22% 13.77% 14.46% 14.63%
Core net interest margin,
fully tax equivalent 3.29% 3.17% 3.33% 3.35% 3.35%
Core efficiency ratio 59.52% 61.56% 61.97% 60.51% 63.05%
Core noninterest expense
as a percent of
average assets 2.47% 2.58% 2.54% 2.51% 2.58%
FIRST PLACE FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
(Dollars in thousands except per share data) As of or for the
Year ended
June 30,
2006 2005
EARNINGS (GAAP)
Tax equivalent net interest income $79,396 72,893
Net interest income $78,414 72,012
Provision for loan losses $5,875 3,509
Noninterest income $28,985 19,879
Noninterest expense $68,150 61,546
Net income $23,044 18,938
Basic earnings per share $1.58 1.32
Diluted earnings per share $1.55 1.30
PERFORMANCE RATIOS (annualized) (GAAP)
Return on average assets 0.88% 0.79%
Return on average equity 9.32% 8.29%
Return on average tangible assets 0.91% 0.82%
Return on average tangible equity 12.96% 12.15%
Net interest margin, fully tax equivalent 3.29% 3.33%
Efficiency ratio 62.88% 66.34%
Noninterest expense as a percent of
average assets 2.61% 2.58%
RECONCILIATION OF NET INCOME TO CORE EARNINGS
GAAP net income $23,044 18,938
Other than temporary impairment of
securities, net of tax $- 3,410
Tax-free proceeds from executive life
insurance policy $- (1,005)
Merger, integration and restructuring,
net of tax $1,413 -
Core earnings $24,457 21,343
CORE EARNINGS
Core earnings $24,457 21,343
Basic core earnings per share $1.68 1.48
Core diluted earnings per share $1.65 1.46
CORE PERFORMANCE RATIOS (annualized)
Core return on average assets 0.94% 0.89%
Core return on average equity 9.89% 9.36%
Core return on average tangible assets 0.96% 0.92%
Core return on average tangible equity 13.76% 13.70%
Core net interest margin, fully tax equivalent 3.29% 3.33%
Core efficiency ratio 60.87% 63.44%
Core noninterest expense as a percent
of average assets 2.53% 2.58%
FIRST PLACE FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
As of or for the three months ended
6/30/06 3/31/06 12/31/05 9/30/05 6/30/05
(Dollars in thousands 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
except per share data) FY 2006 FY 2006 FY 2006 FY 2006 FY 2005
CAPITAL
Equity to total assets
at end of period 10.01% 9.52% 9.34% 9.43% 9.47%
Tangible equity to
tangible assets 6.85% 7.11% 6.90% 6.90% 6.85%
Book value per share $17.87 16.65 16.24 16.02 15.75
Tangible book value
per share $11.83 12.11 11.70 11.41 11.07
Period-end market value
per share $23.01 24.80 24.05 22.17 20.09
Dividends declared per
common share $0.14 0.14 0.14 0.14 0.14
Common stock dividend
payout ratio 46.67% 32.56% 34.15% 33.33% 34.15%
Period-end common shares
outstanding (000) 17,433 15,136 15,096 15,077 15,026
Average basic shares
outstanding (000) 14,704 14,565 14,519 14,473 14,417
Average diluted shares
outstanding (000) 14,950 14,841 14,780 14,710 14,639
ASSET QUALITY
Net charge-offs
(recoveries) $694 460 767 427 547
Annualized net charge-
offs (recoveries)
to average loans 0.13% 0.09% 0.16% 0.09% 0.12%
Nonperforming loans
(NPLs) $16,771 16,117 13,419 15,326 12,605
NPLs as a percent
of total loans 0.71% 0.78% 0.67% 0.82% 0.69%
Nonperforming
assets (NPAs) $20,695 19,940 16,294 18,443 15,611
NPAs as a percent
of total assets 0.66% 0.75% 0.62% 0.72% 0.62%
Allowance for loan
losses $22,319 20,170 19,617 19,194 18,266
Allowance for loan
losses as a
percent of loans 0.95% 0.98% 0.98% 1.02% 1.00%
Allowance for loan
losses as a percent
of NPLs 133.08% 125.15% 146.19% 125.24% 144.91%
MORTGAGE BANKING
Mortgage originations $329,600 270,400 339,100 419,900 394,700
Net gains on sale
of loans $1,196 1,391 1,452 1,883 1,495
Mortgage servicing
portfolio $1,627,595 1,485,629 2,446,605 2,302,874 2,100,689
Mortgage servicing
rights $16,167 14,759 24,448 23,250 21,013
Mortgage servicing
rights valuation (loss)
recovery $(95) 257 107 247 (126)
Mortgage servicing
rights / Mortgage
servicing portfolio 0.99% 0.99% 1.00% 1.01% 1.00%
END OF PERIOD BALANCES
Assets $3,113,210 2,647,155 2,626,531 2,560,292 2,498,943
Deposits $2,060,747 1,748,362 1,765,081 1,754,905 1,709,339
Shareholders' equity $311,574 252,017 245,191 241,469 236,656
Tangible shareholders'
equity $206,160 183,285 176,605 171,959 166,298
AVERAGE BALANCES
Loans $2,115,447 2,036,257 1,952,498 1,850,254 1,795,003
Loans held for sale $71,541 84,698 115,185 171,109 173,527
Earning assets $2,497,241 2,436,108 2,389,805 2,345,365 2,309,944
Assets $2,703,370 2,630,097 2,582,202 2,536,719 2,492,498
Deposits $1,784,940 1,738,856 1,763,597 1,737,768 1,690,508
Shareholders' equity $257,467 249,155 243,175 239,182 234,685
Tangible shareholders'
equity $187,522 180,362 174,145 169,240 163,338
As of or for the
Year ended
June 30,
(Dollars in thousands except per share data) 2006 2005
CAPITAL
Equity to total assets at end of period 10.01% 9.47%
Tangible equity to tangible assets 6.85% 6.85%
Book value per share $17.87 15.75
Tangible book value per share $11.83 11.07
Period-end market value per share $23.01 20.09
Dividends declared per common share $0.56 0.56
Common stock dividend payout ratio 36.13% 43.08%
Period-end common shares outstanding (000) 17,433 15,026
Average basic shares outstanding (000) 14,565 14,387
Average diluted shares outstanding (000) 14,821 14,623
ASSET QUALITY
Net charge-offs (recoveries) $2,348 1,771
Annualized net charge-offs (recoveries)
to average loans 0.12% 0.11%
Nonperforming loans (NPLs) $16,771 12,605
NPLs as a percent of total loans 0.71% 0.69%
Nonperforming assets (NPAs) $20,695 15,611
NPAs as a percent of total assets 0.66% 0.62%
Allowance for loan losses $22,319 18,266
Allowance for loan losses as
a percent of loans 0.95% 1.00%
Allowance for loan losses as
a percent of NPLs 133.08% 144.91%
MORTGAGE BANKING
Mortgage originations $1,359,000 1,386,800
Net gains on sale of loans $5,922 5,853
Mortgage servicing portfolio $1,627,595 2,100,689
Mortgage servicing rights $16,167 21,013
Mortgage servicing rights valuation
(loss) recovery $516 (341)
Mortgage servicing rights / Mortgage
servicing portfolio 0.99% 1.00%
END OF PERIOD BALANCES
Assets $3,113,210 2,498,943
Deposits $2,060,747 1,709,339
Shareholders' equity $311,574 236,656
Tangible shareholders' equity $206,160 166,298
AVERAGE BALANCES
Loans $1,988,006 1,679,814
Loans held for sale $110,882 135,731
Earning assets $2,416,806 2,186,401
Assets $2,612,757 2,389,599
Deposits $1,756,307 1,605,541
Shareholders' equity $247,206 228,315
Tangible shareholders' equity $177,777 155,808
