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Press release from GlobeNewswire (a Nasdaq OMX company)

First Busey Announces 2010 Fourth Quarter and Full Year Results

Tuesday, January 25, 2011

First Busey Announces 2010 Fourth Quarter and Full Year Results14:00 EST Tuesday, January 25, 2011CHAMPAIGN, Ill., Jan. 25, 2011 (GLOBE NEWSWIRE) -- First Busey Corporation's (Nasdaq:BUSE) net income was $7.3 million and net income available to common stockholders was $6.0 million, or $0.09 per fully-diluted common share, for the fourth quarter of 2010. In comparison, the company reported a net loss for the fourth quarter of 2009 of $27.6 million and a net loss available to common stockholders of $29.2 million, or $0.49 per fully-diluted common share. Net income for the year ended December 31, 2010 was $23.2 million and net income available to common stockholders was $18.1 million, or $0.27 per fully-diluted common share, compared to a net loss in 2009 of $323.1 million and a net loss available to common stockholders of $327.9 million, or $7.85 per fully-diluted common share. The 2009 net loss was primarily due to total provision expense of $252.0 million, of which $54.0 million was in the fourth quarter and $208.2 million of goodwill impairment in the third quarter. Our priorities remain balance sheet strength, profitability and growth – in that order. Since the first quarter of 2010, we have demonstrated improvement in non-performing loans, capital ratios and profitability in each quarter. We expect to continue to see gradual improvement in non-performing loans and profitability while maintaining high capital ratios.   As noted in our prior quarter's release, we have turned much of our attention toward growth and raising capital to support our future growth plans. In December 2010, we completed offerings of our common stock and a series of convertible preferred stock, together yielding net proceeds of $84.3 million, pushing our total regulatory capital ratio in excess of 16% and our regulatory tier 1 capital and leverage ratios in excess of 15% and 11%, respectively. In January 2011, we delivered an initiative and the tools to our front line associates in an effort to spur organic growth. We also believe that the recent capital raise allows us to contemplate external growth opportunities as they become available.Asset Quality: Our non-performing loans at December 31, 2010 showed improvement as compared to September 30, 2010 and December 31, 2009 levels. While our past due categories were slightly higher than the prior quarter, they remained within our range of expectations. We expect continued gradual improvement in our overall asset quality in 2011; however, this is dependent on market specific economic conditions. The key metrics are as follows: Non-performing loans decreased to $68.1 million at December 31, 2010 from $79.7 million at September 30, 2010 and $86.3 million at December 31, 2009. Illinois non-performing loans decreased to $38.3 million at December 31, 2010 from $41.8 million at September 30, 2010 and increased from $28 million at December 31, 2009. Florida non-performing loans increased slightly to $23.8 million at December 31, 2010 from $22.8 million at September 30, 2010 and decreased from $40.2 million at December 31, 2009. Indiana non-performing loans decreased to $6.0 million at December 31, 2010 from $15.1 million at September 30, 2010 and $18.1 million at December 31, 2009. Loans 30-89 days past due increased to $23.5 million at December 31, 2010 from $19.3 million at September 30, 2010 and $12.5 million at December 31, 2009. The primary reason for the increase in past dues related to single family residential mortgages, primarily in Illinois. Although we generally experience an increase in single family residential past dues in the fourth quarter, the spike in the fourth quarter of 2010 was higher than fourth quarter of 2009. We believe our loss exposure in single family residential mortgages is limited. Other real estate owned decreased to $9.2 million at December 31, 2010 from $11.5 million at September 30, 2010 and $17.2 million at December 31, 2009. The ratio of non-performing assets to total loans plus other real estate owned decreased to 3.25% from 3.60% at September 30, 2010 and 3.68% at December 31, 2009. The ratio of construction and land development loans to total loans decreased to 7.6% at December 31, 2010 from 8.3% at September 30, 2010 and 11.7% at December 31, 2009. The allowance for loan losses to non-performing loans ratio increased to 111.6% at December 31, 2010 from 104.3% at September 30, 2010, and was below the 116.1% ratio at December 31, 2009. The allowance for loan losses to total loans ratio declined slightly to 3.21% at December 31, 2010 compared to 3.30% at September 30, 2010, and was down from 3.59% at December 31, 2009. Net charge-offs were $17.4 million for the fourth quarter of 2010, which were lower than the $18.5 million recorded during the third quarter of 2010 and the $73.8 million recorded for the fourth quarter of 2009. Provision expense in the fourth quarter of 2010 was $10.3 million compared to $9.5 million in the third quarter of 2010 and $54.0 million in the fourth quarter of 2009. We continue to believe the peak of our non-performing assets occurred in the quarter ended September 30, 2009. Improving our asset quality metrics will continue to be a high priority until we experience sustained improvement in our market specific economic conditions.Operating Performance: Our profit increased to $7.3 million in the fourth quarter of 2010 as compared to $6.0 million in the third quarter of 2010 and significantly higher than the fourth quarter of 2009 loss of $27.6 million. The primary reason for the increase over the third quarter of 2010 was $2.0 million in additional gains on sale of mortgage loans and $1.9 million of gains on sales of OREO, partially offset by $0.8 million of additional provision expense and increased compensation expense related to mortgage production.    Pre-provision, pre-tax income was $21.3 million for the fourth quarter of 2010 compared to $17.4 million for the quarter ended September 30, 2010 and $12.0 million for the quarter ended December 31, 2009. Our normalized pre-provision, pre-tax income was $20.1 million in the fourth quarter of 2010 compared to $18.0 million in the third quarter of 2010 and $17.0 million in the fourth quarter of 2009. The normalized pre-provision, pre-tax income non-GAAP reconciling items in the fourth quarter of 2010 were gains on sales of OREO of $1.9 million, partially offset by OREO costs of $0.4 million and non-accrual interest reversals of $0.2 million.  Significant operating performance items were:  Net income available to common stockholders (net of TARP dividends) for the quarter ended December 31, 2010 was $6.0 million, or $0.09 per fully-diluted share, compared to a loss of $29.2 million, or $0.49 per fully-diluted common share, for the quarter ended December 31, 2009. Net income available to common stockholders (net of TARP dividends) for the year ended December 31, 2010 was $18.1 million, or $0.27 per fully-diluted share, compared to a loss of $327.9 million, or $7.85 per fully-diluted common share, for the year ended December 31, 2009. Net interest margin increased to 3.68% for the fourth quarter of 2010 as compared to 3.64% for the third quarter of 2010, and increased from 3.36% for the fourth quarter of 2009. The net interest margin for the year ended December 31, 2010 was 3.58% as compared to 3.05% for the year ended December 31, 2009. The efficiency ratio decreased to 51.51% for the fourth quarter of 2010 as compared to 58.21% for the third quarter of 2010, and decreased from 70.71% for the fourth quarter of 2009. The efficiency ratio for the year ended December 31, 2010 was 55.91%, an improvement from 63.12% in 2009. Total revenue, net of interest expense and security gains, was $178.9 million in 2010 as compared to $180.3 million in 2009. FirsTech's net income decreased to $1.8 million in 2010 from $2.9 million in 2009. As previously noted, this decrease was expected. Busey Wealth Management's net income increased to $3.3 million in 2010 as compared to $2.6 million in 2009. On January 28, 2011, we will pay a cash dividend of $0.04 per common share to stockholders of record on January 21, 2011.  We have come a long way in 2010. While we are not proud of where we were in 2009 as a result of the unprecedented economic challenges, we have accomplished a significant amount in 2010. We believe only better things are ahead in the future. We will not rest on our modest accomplishments. Rather, we will focus a greater amount of our time on growth, which combined with a strong balance sheet and strong profits make a great company.  We thank our associates for their efforts, our customers for their business and you, our stockholders, for your continued support of Busey. \s\ Van A. Dukeman President & Chief Executive Officer First Busey CorporationSELECTED FINANCIAL HIGHLIGHTS (dollars in thousands, except per share data)              Three Months EndedYear Ended  December 31, 2010September 30, 2010December 31, 2009December 31, 2010December 31, 2009 EARNINGS & PER SHARE DATA             Net income (loss) $7,306 $6,022 $(27,558)$23,230 $(323,113)  Income (loss) available to common stockholders(1)5,984 4,739 $(29,239)18,060 $(327,880)  Revenue(2)46,623 44,202 45,953178,886 180,285  Fully-diluted earnings (loss) per share 0.09 0.07 (0.49)0.27 (7.85)  Cash dividends paid per share 0.04 0.04 0.040.16 0.40              Net income (loss) by operating segment             Busey Bank $7,008 $5,449 $(25,865)$21,230 $(320,807)  Busey Wealth Management 710 716 6493,283 2,557  FirsTech 299 425 4721,821 2,869   AVERAGE BALANCES             Assets $3,548,171 $3,598,237 $3,894,489$3,648,831 $4,230,791  Earning assets 3,227,207 3,280,987 3,628,6233,327,677 3,819,996  Deposits 2,930,644 2,982,590 3,208,9013,026,786 3,363,345  Interest-bearing liabilities 2,723,625 2,778,286 3,064,4512,831,769 3,282,648  Stockholders' equity - common 237,485 234,916 244,143233,152 360,024   PERFORMANCE RATIOS             Return on average assets(3)0.67% 0.52% (2.98%)0.49% (7.75%)  Return on average common equity(3)10.00% 8.00% (47.51%)7.75% (91.07%)  Net interest margin(3)3.68% 3.64% 3.36%3.58% 3.05%  Efficiency ratio(4)51.51% 58.21% 70.71%55.91% 63.12%  Non-interest revenue as a % of total revenues(2)36.92% 32.96% 34.67%34.51% 36.54%   ASSET QUALITY             Gross loans $2,368,777 $2,518,209 $2,792,823      Allowance for loan losses 76,038 83,098 100,179      Net charge-offs 17,361 18,531 73,84266,142 249,992  Allowance for loan losses to loans 3.21% 3.30% 3.59%      Allowance as a percentage of non-performing loans 111.64% 104.29% 116.08%      Non-performing loans             Non-accrual loans 65,486 78,223 82,133      Loans 90+ days past due 2,618 1,457 4,166      Geographically             Downstate Illinois/ Indiana 44,281 56,831 46,120      Florida 23,823 22,849 40,179      Loans 30 -89 days past due 23,477 19,322 12,493      Other non-performing assets 9,154 11,463 17,241      (1) Available to common stockholders, net of preferred dividend and discount accretion(2) Net of interest expense, excludes security gains(3) Quarterly ratios annualized and calculated on net income (loss) available to common stockholders(4) Net of security gains and intangible charges                Condensed Consolidated Balance Sheets      (Unaudited, in thousands, except per share data)      December 31, 2010September 30, 2010December 31, 2009Assets       Cash and due from banks $ 418,965  $  222,226  $ 207,071 Investment securities 599,459  551,720  569,640 Net loans 2,292,739  2,435,110  2,692,644 Premises and equipment 73,218  74,362  77,528 Goodwill and other intangibles 40,242  41,263  44,330 Other assets 180,380   208,532  223,639Total assets $ 3,605,003  $ 3,533,213  $ 3,814,852       Liabilities & Stockholders' Equity      Non-interest bearing deposits $  460,661  $ 449,702  $ 468,230 Interest-bearing deposits 2,455,705  2,474,503  2,702,850 Total deposits $ 2,916,366  $ 2,924,205  $ 3,171,080        Federal funds purchased & securities sold under agreements to repurchase 138,982  130,419  142,325 Short-term borrowings --  4,000  -- Long-term debt 43,159  52,576   82,076 Junior subordinated debt owed to unconsolidated trusts 55,000  55,000  55,000 Other liabilities 30,991  30,446  36,243Total liabilities $ 3,184,498  $ 3,196,646  $ 3,486,724Total stockholders' equity $ 420,505  $ 336,567  $ 328,128Total liabilities & stockholders' equity $ 3,605,003  $ 3,533,213  $ 3,814,852       Per Share Data      Book value per common share $ 3.65  $ 3.56  $ 3.45 Tangible book value per common share $ 3.14  $ 2.94  $ 2.78 Ending number of common shares outstanding 79,100  66,361  66,361                    Condensed Consolidated Statements of Operations        (Unaudited, in thousands, except per share data)Three Months Ended December 31,Year Ended December 31,  2010 20092010 2009           Interest and fees on loans $ 32,954  $ 39,026 $ 138,860  $ 161,971 Interest on investment securities 4,085   5,003 17,323  22,539Total interest income $ 37,039  $ 44,029 $ 156,183  $ 184,510         Interest on deposits 6,170  12,032  32,714  60,079 Interest on short-term borrowings 156  193 640  2,229 Interest on long-term debt 617  1,100 2,930  4,900 Junior subordinated debt owed to unconsolidated trusts 685  685 2,748  2,901Total interest expense $  7,628  $ 14,010 $ 39,032  $ 70,109        Net interest income $ 29,411  $ 30,019 $ 117,151  $  114,401 Provision for loan losses 10,300   54,000 42,000  251,500Net interest income (loss) after provision for loan losses $ 19,111  $  (23,981) $ 75,151  $ (137,099)        Fees for customer services  4,466  4,384 16,592  17,086 Trust fees 3,473  3,197 14,231  12,817 Commissions and brokers' fees 447   465 1,756  1,843 Remittance processing 2,233  3,146 9,349  13,032 Gain on sales of loans 6,146   2,437 16,130  12,379 Net security gains (losses) (7)  (10) 1,018  130 Other 447  2,305 3,677  8,727Total non-interest income $ 17,205  $ 15,924 $ 62,753  $ 66,014         Salaries and wages 10,948  12,143  41,219  44,519 Employee benefits 2,024  900 9,693  9,086 Net occupancy expense 2,188  2,501 9,135   9,886 Furniture and equipment expense 1,360  1,712 5,962  7,288 Data processing expense 2,122  2,271 7,977  7,922 Amortization expense 1,021  1,090 4,088  4,361 Regulatory expense 1,676  1,463 6,978   8,580 Goodwill impairment --  -- --  208,164 OREO expense 429  1,525 1,872  2,761 Other operating expenses 3,520  10,353 18,286  25,128Total non-interest expense $ 25,288  $ 33,958 $ 105,210  $ 327,695        Income (loss) before income taxes $ 11,028  $ (42,015) $ 32,694  $ (398,780) Income taxes 3,722  (14,457) 9,464  (75,667)Net income (loss) $ 7,306  $ (27,558) $ 23,230  $ (323,113) Preferred stock dividends and discount accretion $ 1,322  $ 1,681 $ 5,170  $ 4,767Income (loss) available for common stockholders $ 5,984  $ (29,239) $ 18,060  $ (327,880)        Per Share Data       Basic earnings (loss) per common share $ 0.09  $ (0.49) $ 0.27  $ (7.85) Fully-diluted earnings (loss) per common share $ 0.09  $ (0.49) $ 0.27  $ (7.85) Diluted average common shares outstanding 66,503   59,509 66,397  41,788Corporate Profile First Busey Corporation is a $3.6 billion financial holding company headquartered in Champaign, Illinois. Busey Bank, First Busey Corporation's wholly-owned bank subsidiary, is headquartered in Champaign, Illinois and has thirty-three banking centers serving downstate Illinois, a banking center in Indianapolis, Indiana, and seven banking centers serving southwest Florida. Busey Bank had total assets of $3.6 billion as of December 31, 2010. Busey Wealth Management is a wholly-owned subsidiary of First Busey Corporation. Through Busey Trust Company, Busey Wealth Management delivers trust, asset management, retail brokerage and insurance products and services. As of December 31, 2010, Busey Wealth Management had approximately $3.5 billion in assets under care. First Busey Corporation owns a retail payment processing subsidiary, FirsTech, Inc., which processes over 28 million transactions per year through online bill payments, lockbox processing and walk-in payments through its 3,100 agent locations in 38 states. Busey provides electronic delivery of financial services through our website, www.busey.com.Special Note Concerning Forward-Looking Statements This document may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company's management and on information currently available to management, are generally identifiable by the use of words such as "believe," "expect," "anticipate," "plan," "intend," "estimate," "may," "will," "would," "could," "should" or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events. A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local and national economy; (ii) the economic impact of any future terrorist threats or attacks; (iii) changes in state and federal laws, regulations and governmental policies concerning the Company's general business; (iv) changes in interest rates and prepayment rates of the Company's assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (vii) the loss of key executives or employees; (viii) changes in consumer spending; (ix) unexpected results of acquisitions; (x) unexpected outcomes of existing or new litigation involving the Company; and (xi) changes in accounting policies and practices. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company's financial results, is included in the Company's filings with the Securities and Exchange Commission.CONTACT: David B. White, CFO 217-365-4047