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Press release from GlobeNewswire (a Nasdaq OMX company)

First Busey Announces 2011 First Quarter Results

Tuesday, April 26, 2011

First Busey Announces 2011 First Quarter Results14:00 EDT Tuesday, April 26, 2011 CHAMPAIGN, Ill., April 26, 2011 (GLOBE NEWSWIRE) -- Message from our President & CEO First Busey Corporation's (Nasdaq:BUSE) net income was $9.1 million and net income available to common stockholders was $7.3 million, or $0.09 per fully-diluted common share, for the first quarter of 2011. In comparison, the company reported net income for the first quarter of 2010 of $4.2 million and net income available to common stockholders of $2.9 million, or $0.04 per fully-diluted common share. Our priorities remain balance sheet strength, profitability and growth – in that order. We expect to continue to see gradual improvement in non-performing loans and profitability while maintaining high capital ratios.Asset Quality: Our non-performing loans at March 31, 2011 continued to show improvement. 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 $60.9 million at March 31, 2011 from $68.1 million at December 31, 2010 and $100.7 million at March 31, 2010. Illinois non-performing loans decreased to $30.1 million at March 31, 2011 from $38.3 million at December 31, 2010 and $36.0 million at March 31, 2010. Florida non-performing loans decreased slightly to $23.4 million at March 31, 2011 from $23.8 million at December 31, 2010 and $43.7 million at March 31, 2010. Indiana non-performing loans increased to $7.4 million at March 31, 2011 from $6.0 million at December 31, 2010, but decreased compared to $21.0 million at March 31, 2010. Loans 30-89 days past due decreased to $18.4 million at March 31, 2011 from $23.5 million at December 31, 2010, and $24.6 million at March 31, 2010. The primary reason for the increase in the fourth quarter of 2010 is 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 increase 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 non-performing assets decreased to $7.2 million at March 31, 2011 from $9.2 million at December 31, 2010 and $18.5 million at March 31, 2010. The ratio of non-performing assets to total loans plus other real estate owned at March 31, 2011 decreased to 3.04% from 3.25% at December 31, 2010 and 4.38% at March 31, 2010. The allowance for loan losses to non-performing loans ratio increased to 122.89% at March 31, 2011 from 111.64% at December 31, 2010 and 94.23% at March 31, 2010. The allowance for loan losses to total loans ratio increased to 3.35% at March 31, 2011 compared to 3.21% at December 31, 2010, but decreased from 3.51% at March 31, 2010. Net charge-offs were $6.2 million for the first quarter of 2011, which were lower than the $17.4 million recorded in the fourth quarter of 2010, and the $20.0 million recorded for the first quarter of 2010. Provision expense in the first quarter of 2011 was $5.0 million compared to $10.3 million in the fourth quarter of 2010 and $14.7 million in the first quarter of 2010.Operating Performance: Our profit increased to $9.1 million in the first quarter of 2011 as compared to $7.3 million in the fourth quarter of 2010 and $4.2 million in the first quarter of 2010. The primary reason for the increase over the fourth quarter of 2010 was reduced provision expense of $5.3 million, offset by a decline in gains on sale of mortgage loans of $3.5 million.    Significant operating performance items were:  Net income available to common stockholders (net of TARP dividends) for the quarter ended March 31, 2011 was $7.3 million, or $0.09 per fully-diluted share, compared to net income of $2.9 million, or $0.04 per fully-diluted common share, for the quarter ended March 31, 2010. Net interest margin decreased to 3.55% for the first quarter of 2011 as compared to 3.68% for the fourth quarter of 2010, but increased slightly from 3.52% for the first quarter of 2010. The increase in average earning assets from our December 2010 capital raise and loan pay downs were the primary reasons for the decline in net interest margin in the first quarter of 2011 as compared to fourth quarter of 2010. Overall, yields were fairly consistent on a linked quarter basis. The efficiency ratio increased to 55.87% for the first quarter of 2011, as compared to 51.51% for the fourth quarter of 2010 and 53.69% for the first quarter of 2010. Total revenue, net of interest expense and security gains, for the first quarter of 2011 was $43.9 million compared to $46.6 million for the fourth quarter of 2010 and $44.6 million for the first quarter of 2010. FirsTech's net income increased to $0.5 million for the first quarter of 2011 compared to $0.3 million for the fourth quarter of 2010, but decreased slightly compared to $0.6 million for the first quarter of 2010. Busey Wealth Management's net income of $0.7 million for the first quarter of 2011 was consistent with net income for the fourth quarter of 2010, but decreased slightly from $0.9 million for the first quarter of 2010.Growth: In late January 2011, we began an initiative to spur organic growth and provided certain tools to our front line associates to foster this initiative. These tools facilitated the first quarter growth in non-time deposits of $30.5 million, or 1.6%, over December 31, 2010 levels, and we hope to see continued results going forward.  The sales cycle on deposits is shorter than the sales cycle on loans. We have not yet experienced growth within our loan portfolio. Loans, net of allowance for loan losses, declined $105.2 million from December 31, 2010 due to soft loan demand and our reduction of non-relationship commercial real estate exposure. Additionally, loans held-for-sale declined $29.5 million in that period as interest rate increases on mortgages during the first quarter of 2011 slowed refinancing demand and our gains on sales of loans.Capital: On March 4, 2011, we converted 318.6225 shares of Series B Convertible Preferred Stock into 7,497,000 shares of common stock. The Series B Preferred Stock had been issued as a part of our December 2010 registered direct offering, in which we raised a net $84.3 million in capital. Following the issuance of the common stock, we had 86,596,527 shares of common stock issued and outstanding. No shares of Series B Convertible Preferred Stock remained outstanding.   Overall, we are pleased with our operating results for the first quarter of 2011. Each quarter of improved asset quality and profitability reinforces our belief that now is the time for growth. We continue to explore external growth opportunities while simultaneously focusing on internal growth. We will continue to base our efforts for internal growth on service, listening to our customers and fulfilling our promise to help them accomplish their goals. On April 29, 2011, we will pay a cash dividend of $0.04 per common share to stockholders of record on April 22, 2011.  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 Ended  March 31,December 31,September 30,March 31, 2011201020102010EARNINGS & PER SHARE DATA         Net income$9,110 $7,306 $6,022 $4,217 Income available to common stockholders17,334 5,984 4,739 2,935 Revenue243,888 46,623 44,202 44,557 Fully-diluted income per share0.09 0.09 0.07 0.04 Cash dividends paid per share0.04 0.04 0.04 0.04           Net income by operating segment          Busey Bank$8,820 $7,008 $5,449 $3,470  Busey Wealth Management694 710 716 899  FirsTech450 299 425 641        AVERAGE BALANCES         Assets$3,590,108 $3,548,171 $3,598,237 $3,724,025 Earning assets3,294,097 3,227,207 3,280,987 3,402,221 Deposits2,898,517 2,930,644 2,982,590 3,088,437 Interest-bearing liabilities2,654,425 2,723,625 2,778,286 2,909,035 Stockholders' equity - common289,475 237,485 234,916 230,703 Tangible stockholders' equity - common249,563 196,616 193,008 187,776         PERFORMANCE RATIOS         Return on average assets30.83% 0.67% 0.52% 0.32% Return on average common equity310.27% 10.00% 8.00% 5.16% Return on average tangible common equity311.92% 12.07% 9.74% 6.34% Net interest margin33.55% 3.68% 3.64% 3.52% Efficiency ratio455.87% 51.51% 58.21% 53.69% Non-interest revenue as a % of total revenues235.41% 36.92% 32.96% 34.90%        ASSET QUALITY         Gross loans$2,232,849 $2,368,777 $2,518,209 $2,706,793 Allowance for loan losses74,849 76,038 83,098 94,929 Net charge-offs6,189 17,361 18,531 19,950 Allowance for loan losses to loans3.35% 3.21% 3.30% 3.51% Allowance as a percentage of non-performing loans122.89% 111.64% 104.29% 94.23% Non-performing loans          Non-accrual loans56,829 65,486 78,223 97,630  Loans 90+ days past due4,078 2,618 1,457 3,116  Geographically          Downstate Illinois/ Indiana37,527 44,281 56,831 57,020  Florida23,380 23,823 22,849 43,726 Loans 30 -89 days past due18,419 23,477 19,322 24,630 Other non-performing assets7,193 9,160 11,470 18,511          1 Available to common stockholders, net of preferred dividend and discount accretion2 Net of interest expense, excludes security gains3 Quarterly ratios annualized and calculated on net income available to common stockholders4 Net of security gains and intangible charges        Condensed Consolidated Balance Sheets      (Unaudited, in thousands, except per share data)March 31,  December 31,  March 31,   2011 2010 2010Assets       Cash and due from banks$412,152 $418,965 $218,867 Investment securities664,930 599,459 530,215 Net loans, including loans held for sale2,157,999 2,292,739 2,611,864 Premises and equipment72,518 73,218 76,322 Goodwill and other intangibles39,358 40,242 43,308 Other assets171,008 180,380 221,904Total assets$3,517,965 $3,605,003 $3,702,480        Liabilities & Stockholders' Equity       Non-interest bearing deposits$484,480 $460,661 $443,207 Interest-bearing deposits2,369,516 2,455,705 2,635,811 Total deposits$2,853,996 $2,916,366 $3,079,018         Securities sold under agreements to repurchase120,734 138,982 133,297 Long-term debt36,409 43,159 73,076 Junior subordinated debt owed to unconsolidated trusts55,000 55,000 55,000 Other liabilities27,895 30,991 33,373Total liabilities$3,094,034 $3,184,498 $3,373,764Total stockholders' equity$423,931 $420,505 $328,716Total liabilities & stockholders' equity$3,517,965 $3,605,003 $3,702,480        Per Share Data      Book value per common share$3.74 $3.65 $3.45 Tangible book value per common share$3.29 $3.14 $2.79 Ending number of common shares outstanding86,597 79,100 66,361    Condensed Consolidated Statements of Operations  (Unaudited, in thousands, except per share data)Three Months Ended March 31,  2011 2010       Interest and fees on loans$30,508 $36,036 Interest on investment securities4,398 4,657Total interest income$34,906 $40,693       Interest on deposits5,259 9,951 Interest on short-term borrowings121 163 Interest on long-term debt496 894 Junior subordinated debt owed to unconsolidated trusts683 680Total interest expense$6,559 $11,688      Net interest income$28,347 $29,005 Provision for loan losses5,000 14,700Net interest income after provision for loan losses$23,347 $14,305       Trust fees4,548 4,210 Commissions and brokers' fees441 440 Fees for customer services4,329 3,943 Remittance processing2,381 2,620 Gain on sales of loans2,632 2,438 Net security gains (losses)(2) 742 Other1,210 1,901Total non-interest income$15,539 $16,294       Salaries and wages9,560 9,666 Employee benefits2,759 2,639 Net occupancy expense2,415 2,342 Furniture and equipment expense1,324 1,531 Data processing expense2,110 1,896 Amortization expense884 1,023 Regulatory expense1,847 1,463 OREO expense212 393 Other operating expenses4,554 4,260Total non-interest expense$25,665 $25,213       Income before income taxes$13,221 $5,386 Income taxes4,111 1,169Net income$9,110 $4,217 Preferred stock dividends and discount accretion$1,776 $1,282Income available for common stockholders$7,334 $2,935      Per Share Data    Basic earnings per common share$0.09 $0.04 Fully-diluted earnings per common share$0.09 $0.04 Diluted average common shares outstanding81,356 66,361Corporate Profile First Busey Corporation is a $3.5 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 $3.5 billion as of March 31, 2011. 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 March 31, 2011, Busey Wealth Management had approximately $3.9 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