FLB First Natl Bancshares Fla

First National Bankshares of Florida, Inc. Reports Third Quarter Net Income of $8.9 Million, or $0.17 Per Share NAPLES, Fla., Oct. 14 /PRNewswire-FirstCall/ -- First National Bankshares of Florida, Inc. (NYSE:FLB), a diversified financial services company focused on expansion in the high-growth Florida market, today reported third quarter 2004 net income of $8.9 million, or $0.17 per diluted share, compared with $8.3 million, or $0.17 per diluted share, in the third quarter of 2003. (Logo: http://www.newscom.com/cgi-bin/prnh/20031230/FNBFLOGO ) During the third quarter of 2004, the company incurred after-tax merger expenses of $2.9 million, or $0.05 per diluted share, related to the acquisition of Southern Community Bancorp. During the third quarter of 2003, the company incurred after-tax restructuring expenses of $1.2 million, or $0.03 per share, related to the spin-off from F.N.B. Corporation. The company's third quarter 2004 operating revenue, consisting of net interest income on a taxable equivalent basis and non-interest income, totaled $53.1 million, an increase of 14.0% from $46.6 million in operating revenue reported during the third quarter of 2003. "During the third quarter, we had the emotional and physical distraction of four major hurricanes. But thanks to the dedication of our people we were able to demonstrate solid performance," said Gary L. Tice, Chairman and Chief Executive Officer of First National Bankshares. "We also were extremely proud to announce our planned affiliation with Fifth Third Bancorp. This merger is on schedule for completion in January of 2005." For the first nine months of 2004, net income totaled $30.6 million, or $0.61 per diluted share. This compares with $27.6 million, or $0.58 per share, a year ago. During the nine months ended September 30, 2004, the company incurred pre-tax merger expenses of $4.6 million, or $0.05 per share, related to the acquisition of Southern Community Bancorp. During the nine months ended September 30, 2003, the company incurred pre-tax merger and restructuring expenses of $3.0 million, or $0.04 per share, related to the acquisition of Charter Banking Corporation and the spin-off from F.N.B. Corporation. First National Bankshares' third quarter 2004 results reflect a return on average assets (ROA) of 0.78% and a return on average shareholders' equity (ROE) of 7.7%. Excluding the impact of the merger-related expenses, the ROA was 1.03% and the ROE was 10.2%. Due to the significant capital levels required to be assigned to intangibles for regulatory purposes, management also evaluates performance ratios on a cash basis, or excluding the impact of intangibles and any related intangible amortization. On a cash basis, the ROA was 1.13% and ROE was 24.1%. Intangibles as of September 30, 2004 totaled $427.6 million. Pre-tax intangible amortization recognized during the quarter totaled $611,000. Credit quality remained exceptional during the quarter. As of September 30, 2004, the allowance for loan losses totaled $40.3 million, or 1.09% of total loans and 356% of non-performing loans. These figures compare with 1.11% and 686%, respectively, as of June 30, 2004, and 1.13% and 613%, respectively, as of September 30, 2003. The acquisition of Southern Community Bancorp contributed approximately $10.4 million to the allowance for loan losses and increased non-performing loans by $2.7 million. Annualized net loan charge-offs for the quarter represented 0.03% of average loans as of September 30, 2004, versus 0.05% as of June 30, 2004, and 0.07% as of September 30, 2003. Non-performing assets represented 0.22% of total assets as of September 30, 2004, compared with 0.12% as of June 30, 2004, and 0.16% as of September 30, 2003. Net interest income on a tax-equivalent basis was $37.5 million for the third quarter of 2004, an increase of 18.9% from $31.5 million a year ago. The net interest margin for the three months ended September 30, 2004, was 3.79%, compared with 3.88% for the three months ended June 30, 2004, and 3.97% for the three months ended September 30, 2003. Non-interest income totaled $15.6 million for the third quarter of 2004, up 3.9% from $15.0 million in the third quarter of 2003. Revenue from insurance and wealth management, which is included in non-interest income, totaled $8.5 million during the quarter, compared with $8.6 million a year ago. Gains from the sale of mortgage loans totaled $702,000 during the third quarter of 2004, compared with $256,000 a year ago. At September 30, 2004, non-interest income represented 29.4% of operating revenue. Non-interest expense for the third quarter of 2004 was $39.2 million, compared with $33.0 million a year ago. The efficiency ratio for the three months ended September 30, 2004 was 73.8%, compared with 70.9% for the three months ended September 30, 2003. Excluding the impact of merger and restructuring expenses, the efficiency ratios for the same periods were 65.1% and 66.7%, respectively. Total earning assets grew 48% to $4.7 billion as of September 30, 2004, compared with $3.2 billion a year ago. Total loans grew 59% to $3.7 billion as of September 30, 2004, compared with $2.3 billion a year ago. The acquisition of Southern Community increased total earning assets and total loans by $982.0 million and $864.5 million, respectively. At September 30, 2004, investment securities totaled $985.4 million and were 20.9% of earning assets, compared with 25.8% at September 30, 2003. Total deposits were $3.9 billion as of September 30, 2004, compared with $2.7 billion as of September 30, 2003. The acquisition of Southern Community increased total deposits by $837.7 million. On September 3, 2004, First National Bankshares completed the acquisition of Southern Community Bancorp, the holding company for Southern Community Bank of Central Florida, Southern Community Bank of Southwest Florida and Southern Community Bank of South Florida. On the acquisition date, First National Bankshares issued 11.5 million common shares in exchange for the outstanding common stock of Southern Community. Headquartered in Orlando, Florida, Southern Community had approximately $1 billion in assets and $838 million in deposits with 18 full-service banking offices throughout South and Central Florida. All Southern Community offices have been merged with and into First National Bankshares' wholly owned subsidiary, First National Bank of Florida. On June 30, 2004, First National Bankshares announced the planned acquisition of First Bradenton Bank. Established in 1997, First Bradenton is a state-chartered commercial bank with $65.7 million in assets, $60.2 million in deposits and one banking location in Bradenton, Florida. The transaction is scheduled to close during the fourth quarter. Upon completion of the merger, First National Bank will have nearly $5.6 billion in total assets, $4.0 billion in deposits and 75 full-service financial centers in South and Central Florida. On August 2, 2004, First National Bankshares of Florida and Fifth Third Bancorp announced the signing of a definitive agreement in which Fifth Third will acquire First National Bankshares and its subsidiaries. The acquisition is expected to close in the first quarter of 2005 and is subject to normal regulatory approvals in addition to the approval of First National's shareholders. Upon completion of this transaction, Fifth Third will have approximately $6.6 billion in assets and 90 banking centers in the state of Florida. Headquartered in Cincinnati, Ohio, Fifth Third is a diversified financial services company with $98.3 billion in total assets and 1,005 banking centers in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee and West Virginia. The company's common stock is traded through the Nasdaq National Market System under the symbol "FITB." About First National Bankshares Headquartered in Naples, Florida, First National Bankshares of Florida, Inc. is a $5.5 billion diversified financial services company. The company's focus is on expansion in the high-growth Florida market. In addition to traditional community banking, the company provides a complete line of insurance and wealth management services with 74 full-service financial centers located throughout South and Central Florida. The company's stock is traded on the New York Stock Exchange under the symbol "FLB." This document contains forward-looking statements with respect to the plans, objectives, financial condition, results of operations and businesses of First National Bankshares of Florida, Inc.; the benefits and synergies of the planned acquisition of First Bradenton Bank; the benefits and synergies of the planned affiliation with Fifth Third Bancorp; and the expected date of closing of the acquisitions, including statements containing such words as "believes," "expects," "projects," "anticipates," and similar expressions. Such statements involve risks and uncertainties. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) competitive pressures among depository institutions increase significantly; (2) changes in the interest rate environment reduce interest rate margins; (3) general economic conditions are less favorable than expected; (4) legislative or regulatory changes adversely affect the businesses in which the company is engaged; (5) costs, delays, and any other difficulties related to the planned transactions; (6) failure of the parties to satisfy conditions to the closing of the acquisitions; (7) the ability to manage and continue growth; and (8) other risk factors as detailed in First National Bankshares' reports filed with the Securities and Exchange Commission. First National Bankshares disclaims any responsibility to update these forward-looking statements. FIRST NATIONAL BANKSHARES OF FLORIDA, INC. (Unaudited) (Dollars in thousands, except per share data) 2004 Third Second First Average balances Quarter Quarter Quarter Total assets $4,533,627 $4,030,853 $3,808,391 Earning assets 3,938,467 3,516,235 3,314,374 Securities 907,547 884,285 798,555 Loans, net of unearned 3,021,370 2,628,440 2,509,380 Allowance for loan losses 33,116 29,965 28,895 Intangibles 258,094 184,148 184,137 Non-interest bearing deposits 547,339 535,622 475,369 Interest bearing deposits 2,665,530 2,419,877 2,339,375 Total deposits 3,212,869 2,955,499 2,814,744 Short-term borrowings 488,369 328,225 297,968 Long-term debt 330,440 338,386 290,195 Shareholders' equity 459,004 369,718 371,984 Asset quality data Non-performing loans $11,316 $4,332 $4,263 Other real estate owned 743 440 440 Non-performing assets 12,059 4,772 4,703 Net loan charge-offs $211 $312 $363 Allowance for loan losses 40,307 29,705 29,141 Non-performing loans / total loans 0.31% 0.16% 0.17% Non-performing assets / total assets 0.22% 0.12% 0.12% Allowance for loan losses / total loans 1.09% 1.11% 1.14% Allowance for loan losses / non-performing loans 356.19% 685.71% 683.58% Net loan charge-offs (annualized) / average loans 0.03% 0.05% 0.06% Balances at period end Total assets $5,503,520 4,087,319 $3,998,528 Earning assets 4,712,590 3,571,654 3,492,684 Securities 985,429 879,952 885,258 Mortgage loans held for sale 18,531 12,827 20,629 Loans, net of unearned 3,707,461 2,677,862 2,559,791 Intangibles 427,636 183,998 184,339 Non-interest bearing deposits $634,549 545,882 560,498 Interest bearing deposits 3,273,236 2,431,729 2,399,655 Total deposits 3,907,785 2,977,611 2,960,153 Short-term borrowings 511,295 388,724 324,603 Long-term debt 353,931 326,196 296,479 Shareholders' equity 686,316 358,403 377,814 Book value per common share 11.57 7.54 7.92 Tangible book value per common share 4.36 3.67 4.06 Tangible capital ratio 5.10 4.47 5.07 FIRST NATIONAL BANKSHARES OF FLORIDA, INC. (Unaudited) (Dollars in thousands, except per share data) 2003 Fourth Third Second First Average balances Quarter Quarter Quarter Quarter Total assets $3,721,345 $3,683,569 $3,683,030 $2,827,481 Earning assets 3,203,028 3,150,708 3,171,344 2,534,157 Securities 796,648 820,723 869,901 446,171 Loans, net of unearned 2,399,789 2,318,335 2,275,443 2,072,235 Allowance for loan losses 27,047 26,632 25,423 21,976 Intangibles 184,145 184,666 176,779 70,792 Non-interest bearing deposits 439,786 438,973 445,089 378,727 Interest bearing deposits 2,268,907 2,277,667 2,309,268 1,808,086 Total deposits 2,708,693 2,716,640 2,754,357 2,186,813 Short-term borrowings 323,265 276,293 248,962 271,604 Long-term debt 198,412 199,190 202,703 51,723 Shareholders' equity 445,298 448,903 431,221 277,985 Asset quality data Non-performing loans $5,521 $4,291 $4,565 $4,897 Other real estate owned 0 1,465 1,641 1,428 Non-performing assets 5,521 5,756 6,206 6,325 Net loan charge-offs $851 $416 $655 $1,086 Allowance for loan losses 28,104 26,283 25,746 24,575 Non-performing loans / total loans 0.23% 0.18% 0.20% 0.22% Non-performing assets / total assets 0.15% 0.16% 0.17% 0.17% Allowance for loan losses / total loans 1.15% 1.13% 1.12% 1.11% Allowance for loan losses / non-performing loans 509.04% 612.51% 563.99% 501.84% Net loan charge-offs (annualized) / average loans 0.14% 0.07% 0.12% 0.21% Balances at period end Total assets $3,751,136 $3,710,352 $3,668,719 $3,665,861 Earning assets 3,245,863 3,177,985 3,153,152 3,158,504 Securities 775,334 820,762 822,582 906,927 Mortgage loans held for sale 15,153 13,819 28,883 25,938 Loans, net of unearned 2,449,382 2,335,533 2,296,770 2,209,204 Intangibles 184,246 184,864 175,162 175,510 Non-interest bearing deposits 451,837 439,285 460,852 458,505 Interest bearing deposits 2,268,152 2,297,474 2,280,312 2,303,926 Total deposits 2,719,989 2,736,759 2,741,164 2,762,431 Short-term borrowings 354,051 300,724 260,988 233,956 Long-term debt 271,000 194,096 191,855 205,282 Shareholders' equity 365,115 442,734 438,423 422,959 Book value per common share 7.65 9.33 9.23 8.91 Tangible book value per common share 3.79 5.43 5.54 5.22 Tangible capital ratio 5.07 7.31 7.54 7.09 FIRST NATIONAL BANKSHARES OF FLORIDA, INC. (Unaudited) (Dollars in thousands, except per share data) 3rd Qtr 2004 - For the Nine Months 3rd Qtr 2003 Ended September 30, Percent Percent Average balances Variance 2004 2003 Variance Total assets 23.1 $4,125,786 $3,389,583 21.7 Earning assets 25.0 3,590,965 $2,930,862 22.5 Securities 10.6 863,623 $709,036 21.8 Loans, net of unearned 30.3 2,720,831 $2,208,550 23.2 Allowance for loan losses 24.3 30,668 $24,694 24.2 Intangibles 39.8 208,973 $124,078 68.4 Non-interest bearing deposits 24.7 519,545 421,005 23.4 Interest bearing deposits 17.0 2,475,623 2,131,775 16.1 Total deposits 18.3 2,995,168 2,552,780 17.3 Short-term borrowings 76.8 371,947 265,637 40.0 Long-term debt 65.9 319,713 151,180 111.5 Shareholders' equity 2.3 400,450 383,519 4.4 Asset quality data Non-performing loans 163.7 $11,316 $4,291 163.7 Other real estate owned -49.3 743 1,465 -49.3 Non-performing assets 109.5 12,059 5,756 109.5 Net loan charge-offs -49.3 $886 $2,157 -58.9 Allowance for loan losses 53.4 40,307 26,283 53.4 Non-performing loans / total loans 0.31% 0.18% Non-performing assets / total assets 0.22% 0.16% Allowance for loan losses / total loans 1.09% 1.13% Allowance for loan losses / non-performing loans 356.19% 612.51% Net loan charge-offs (annualized) / average loans 0.04% 0.13% Balances at period end Total assets 48.3 $5,503,520 $3,710,352 48.3 Earning assets 48.3 4,712,590 3,177,985 48.3 Securities 20.1 985,429 820,762 20.1 Mortgage loans held for sale 34.1 18,531 13,819 34.1 Loans, net of unearned 58.7 3,707,461 2,335,533 58.7 Intangibles 131.3 427,636 184,864 131.3 Non-interest bearing deposits 44.5 634,549 439,285 44.5 Interest bearing deposits 42.5 3,273,236 2,297,474 42.5 Total deposits 42.8 3,907,785 2,736,759 42.8 Short-term borrowings 70.0 511,295 300,724 70.0 Long-term debt 82.3 353,931 194,096 82.3 Shareholders' equity 55.0 686,316 442,734 55.0 Book value per common share 11.57 9.33 Tangible book value per common share 4.36 5.43 Tangible capital ratio 5.10 7.31 *Percent variance not meaningful FIRST NATIONAL BANKSHARES OF FLORIDA, INC. (Unaudited) (Dollars in thousands, except per share data) 2004 Third Second First Statement of earnings Quarter Quarter Quarter Interest income - taxable equivalent basis $52,180 $45,808 $43,897 Interest income $51,753 $45,414 $43,523 Interest expense 14,699 11,845 10,919 Net interest income 37,054 33,569 32,604 Provision for loan losses 400 875 1,400 Net interest income after provision 36,654 32,694 31,204 Service charges 5,142 4,974 4,898 Insurance commissions and fees 6,768 8,894 7,680 Securities commissions and fees 864 1,206 1,116 Trust income 837 855 814 Gain on sale of securities 107 0 163 Gain on sale of mortgage loans 702 766 1,020 Other 1,211 1,061 1,019 Total non-interest income 15,631 17,756 16,710 Salaries and employee benefits 20,924 19,857 19,494 Occupancy and equipment 5,910 5,376 5,368 Amortization of intangibles 611 345 345 Merger expenses 4,645 0 0 Other 7,104 7,783 7,322 Total non-interest expense 39,194 33,361 32,529 Income before income taxes 13,091 17,089 15,385 Income taxes 4,167 5,798 5,036 Net income (loss) $8,924 $11,291 $10,349 Basic earnings per share 0.17 0.24 0.22 Diluted earnings per share 0.17 0.23 0.21 Earnings excluding merger and restructuring expenses $11,777 $11,291 $10,349 Basic earnings per share 0.23 0.24 0.22 Diluted earnings per share 0.22 0.23 0.21 Average basic shares outstanding 51,109,030 47,648,095 47,694,145 Average diluted shares outstanding 53,155,536 49,013,292 48,942,636 Common shares outstanding 59,330,025 47,515,420 46,313,224 Cash dividend per common share 0.07 0.07 0.07 Performance ratios Return on average shareholders' equity 7.73% 12.28% 11.19% Return on average assets 0.78% 1.13% 1.09% Net interest margin (FTE) 3.79% 3.88% 4.00% Yield on earning assets (FTE) 5.27% 5.24% 5.33% Efficiency ratio (FTE) 73.79% 64.50% 65.47% Performance ratios (earnings excluding merger and restructuring expenses) Return on average shareholders' equity 10.21% 12.28% 11.19% Return on average shareholders' equity, cash basis 24.06% 24.93% 22.61% Return on average assets 1.03% 1.13% 1.09% Return on average assets, cash basis 1.13% 1.20% 1.17% Efficiency ratio (FTE) 65.05% 64.50% 65.47% FIRST NATIONAL BANKSHARES OF FLORIDA, INC. (Unaudited) (Dollars in thousands, except per share data) 2003 Fourth Third Second First Statement of earnings Quarter Quarter Quarter Quarter Interest income - taxable equivalent basis $43,363 $42,168 $44,458 $38,534 Interest income $42,819 $41,617 $43,895 $37,963 Interest expense 10,163 10,636 12,068 9,979 Net interest income 32,656 30,981 31,827 27,984 Provision for loan losses 2,672 952 1,828 1,732 Net interest income after provision 29,984 30,029 29,999 26,252 Service charges 4,353 4,872 4,891 3,999 Insurance commissions and fees 6,686 6,861 6,558 6,077 Securities commissions and fees 839 993 1,096 863 Trust income 763 701 681 623 Gain on sale of securities 23 7 102 311 Gain on sale of mortgage loans 636 256 2,772 1,926 Other 1,448 1,351 1,423 1,305 Total non-interest income 14,748 15,041 17,523 15,104 Salaries and employee benefits 19,690 21,042 19,154 16,766 Occupancy and equipment 5,094 5,058 4,928 3,971 Amortization of intangibles 342 341 305 278 Merger expenses 221 0 0 1,014 Other 12,148 6,581 7,145 6,220 Total non-interest expense 37,495 33,022 31,532 28,249 Income before income taxes 7,237 12,048 15,990 13,107 Income taxes 3,090 3,749 5,404 4,388 Net income (loss) $4,147 $8,299 $10,586 $8,719 Basic earnings per share 0.09 0.17 0.22 0.18 Diluted earnings per share 0.09 0.17 0.22 0.18 Earnings excluding merger and restructuring expenses $10,682 $9,497 $10,586 $9,378 Basic earnings per share 0.22 0.20 0.22 0.20 Diluted earnings per share 0.22 0.20 0.22 0.19 Average basic shares outstanding 47,510,616 47,475,241 47,450,845 47,426,950 Average diluted shares outstanding 48,449,740 48,415,199 48,296,220 48,304,846 Common shares outstanding 46,317,300 46,082,495 46,111,994 46,060,211 Cash dividend per common share N/A N/A N/A N/A Performance ratios Return on average shareholders' equity 3.69% 7.33% 9.85% 12.72% Return on average assets 0.44% 0.89% 1.15% 1.25% Net interest margin (FTE) 4.11% 3.97% 4.10% 4.57% Yield on earning assets (FTE) 5.37% 5.31% 5.62% 6.17% Efficiency ratio (FTE) 78.20% 70.90% 63.17% 64.70% Performance ratios (earnings excluding merger and restructuring expenses) Return on average shareholders' equity 9.52% 8.39% 9.85% 13.68% Return on average shareholders' equity, cash basis 16.55% 14.57% 16.98% 18.69% Return on average assets 1.14% 1.02% 1.15% 1.35% Return on average assets, cash basis 1.22% 1.10% 1.23% 1.40% Efficiency ratio (FTE) 60.00% 66.72% 63.17% 62.38% FIRST NATIONAL BANKSHARES OF FLORIDA, INC. (Unaudited) (Dollars in thousands, except per share data) 3rd Qtr 2004 - For the Nine Months 3rd Qtr 2003 Ended September 30, Percent Percent Statement of earning Variance 2004 2003 Variance Interest income - taxable equivalent basis 23.7 $141,885 $125,160 13.4 Interest income 24.4 $140,690 $123,475 13.9 Interest expense 38.2 37,463 32,683 14.6 Net interest income 19.6 103,227 90,792 13.7 Provision for loan losses -58.0 2,675 4,512 -40.7 Net interest income after provision 22.1 100,552 86,280 16.5 Service charges 5.5 15,014 13,762 9.1 Insurance commissions and fees -1.4 23,342 19,496 19.7 Securities commissions and fees -13.0 3,186 2,952 7.9 Trust income 19.4 2,506 2,005 25.0 Gain on sale of securities * 270 420 -35.7 Gain on sale of mortgage loans 174.2 2,488 4,954 -49.8 Other -10.4 3,291 4,079 -19.3 Total non-interest income 3.9 50,097 47,668 5.1 Salaries and employee benefits -0.6 60,275 56,962 5.8 Occupancy and equipment 16.8 16,654 13,957 19.3 Amortization of intangibles 79.2 1,301 924 40.8 Merger expenses * 4,645 1,014 * Other 7.9 22,209 19,946 11.3 Total non-interest expense 18.7 105,084 92,803 13.2 Income before income taxes 8.7 45,565 41,145 10.7 Income taxes 11.1 15,001 13,541 10.8 Net income (loss) 7.5 $30,564 $27,604 10.7 Basic earnings per share 0.0 0.63 0.58 8.6 Diluted earnings per share 0.0 0.61 0.58 5.2 Earnings excluding merger and restructuring expenses 24.0 $33,417 $29,461 13.4 Basic earnings per share 15.0 0.68 0.62 9.7 Diluted earnings per share 10.0 0.66 0.62 6.5 Average basic shares outstanding 7.7 48,825,455 47,444,857 2.9 Average diluted shares outstanding 9.8 50,358,075 47,470,965 6.1 Common shares outstanding 28.7 59,330,025 46,082,495 28.7 Cash dividend per common share * 0.21 N/A * Performance ratios Return on average shareholders' equity 10.20% 9.62% Return on average assets 0.99% 1.09% Net interest margin (FTE) 3.88% 4.22% Yield on earning assets (FTE) 5.28% 5.71% Efficiency ratio (FTE) 68.01% 66.22% Performance ratios (earnings excluding merger and restructuring expenses) Return on average shareholders' equity 11.15% 10.27% Return on average shareholders' equity, cash basis 23.87% 15.47% Return on average assets 1.08% 1.16% Return on average assets, cash basis 1.17% 1.23% Efficiency ratio (FTE) 65.00% 65.50% *Percent variance not meaningful http://www.newscom.com/cgi-bin/prnh/20031230/FNBFLOGO http://photoarchive.ap.org/ DATASOURCE: First National Bankshares of Florida, Inc. CONTACT: Clay W. Cone, Vice President, Director of Corporate Communications, First National Bankshares of Florida, Inc., +1-239-436-1676 Web site: http://www.firstnationalbankshares.com/

Copyright