The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Globe Investor

News Sources

Take control of your investments with the latest investing news and analysis

Press release from GlobeNewswire (a Nasdaq OMX company)

Glacier Bancorp, Inc. Announces Results for the Quarter Ended June 30, 2013

Thursday, July 25, 2013

Glacier Bancorp, Inc. Announces Results for the Quarter Ended June 30, 2013

13:30 EDT Thursday, July 25, 2013

HIGHLIGHTS:

  • All time record net income for the current quarter of $22.7 million, an increase of 20 percent from the prior year second quarter net income of $19.0 million.
     
  • Current quarter diluted earnings per share of $0.31, an increase of 19 percent from the prior year second quarter diluted earnings per share of $0.26. 
     
  • Completed the acquisition of Wheatland Bankshares, Inc., and its subsidiary, First State Bank in Wheatland, Wyoming. 
     
  • Excluding the acquisition, the loan portfolio increased $98.4 million, or 3 percent, during the current quarter. 
     
  • Current quarter net interest margin, on a tax-equivalent basis, of 3.30 percent, an increase of 16 basis points from the prior quarter net interest margin of 3.14 percent.
     
  • Dividend declared of $0.15 per share during the quarter, an increase of $0.01 per share from the prior quarter dividend per share of $0.14.

Results Summary

           
  Three Months ended Six Months ended
(Dollars in thousands, except per share data) June 30, March 31, June 30, June 30, June 30,
  2013 2013 2012 2013 2012
Net income  $ 22,702 20,768 18,981 43,470 35,314
Diluted earnings per share  $ 0.31 0.29 0.26 0.6 0.49
Return on average assets (annualized) 1.17% 1.11% 1.04% 1.14% 0.97%
Return on average equity (annualized) 9.78% 9.20% 8.69% 9.49% 8.14%

KALISPELL, Mont., July 25, 2013 (GLOBE NEWSWIRE) -- Glacier Bancorp, Inc. (Nasdaq:GBCI) reported net income for the current quarter of $22.7 million, an increase of $3.7 million, or 20 percent, from the $19.0 million of net income for the prior year second quarter. Diluted earnings per share for the current quarter was $0.31 per share, an increase of $0.05, or 19 percent, from the prior year second quarter diluted earnings per share of $0.26. "We continued to build momentum this quarter with our ability to generate good growth in both our earnings and balance sheet," said Mick Blodnick President and Chief Executive Officer. "Loan growth in particular was a pleasant upside surprise and positions us to exceed our earlier projections for the year," Blodnick said. "In addition, we expanded our net interest margin again and certainly hope this trend continues through the rest of the year."

Net income for the six months ended June 30, 2013 was $43.5 million, an increase of $8.2 million, from the $35.3 million of net income for the prior year first six months. Diluted earnings per share for the first six months of the current year was $0.60 per share, an increase of $0.11, or 22 percent, from the diluted earnings per share in the prior year first six months. 

On May 31, 2013, the Company completed the acquisition of Wheatland Bankshares, Inc., and its subsidiary, First State Bank which has community bank offices in Wheatland, Torrington, and Guernsey, Wyoming. First State Bank will operate as a division of Glacier Bank under the name "First State Bank, division of Glacier Bank." Cash of $11.0 million and 1,455,256 shares of the Company's common stock were issued in the acquisition which resulted in $13.4 million of goodwill.   The Company incurred $571 thousand of legal and professional expenses in connection with the acquisition. The Company's results of operations and financial condition include the acquisition of First State Bank from the acquisition date and the following table provides information on the fair value of selected classifications of assets and liabilities acquired:

(Dollars in thousands) May 31,
2013
Total assets $ 300,541
Investment securities, available-for-sale 75,643
Loans receivable 171,199
Non-interest bearing deposits 30,758
Interest bearing deposits 224,439
Federal Home Loan Bank advances 5,467

Asset Summary

           
        $ Change from $ Change from
(Dollars in thousands) June 30, December 31, June 30, December 31, June 30,
  2013 2012 2012 2012 2012
Cash and cash equivalents  $ 132,456 187,040 140,419 (54,584) (7,963)
Investment securities, available-for-sale 3,721,377 3,683,005 3,404,282 38,372 317,095
Loans receivable          
Residential real estate 531,834 516,467 525,551 15,367 6,283
Commercial 2,544,787 2,278,905 2,293,876 265,882 250,911
Consumer and other 596,835 602,053 625,769 (5,218) (28,934)
Loans receivable 3,673,456 3,397,425 3,445,196 276,031 228,260
Allowance for loan and lease losses (130,883) (130,854) (137,459) (29) 6,576
Loans receivable, net 3,542,573 3,266,571 3,307,737 276,002 234,836
Other assets 600,410 610,824 581,664 (10,414) 18,746
Total assets  $ 7,996,816 7,747,440 7,434,102 249,376 562,714

Excluding retained investment securities of $21.6 million from the acquisition of First State Bank, investment securities increased $41.7 million, or 1 percent, during the current quarter and increased $16.8 million, or less than 1 percent, from December 31, 2012. The Company continued to purchase investment securities during the current quarter primarily to offset principal payments. The investment securities purchased during the current quarter included U.S. agency mortgage-backed securities, U.S. agency collateralized mortgage obligations, corporate and municipal bonds. The investment securities represent 47 percent of total assets at June 30, 2013, compared to 48 percent at December 31, 2012 and 46 percent at June 30, 2012. 

Excluding the loans receivable of $171.2 million from the acquisition of First State Bank, the loan portfolio increased $98.4 million, or 3 percent, during the current quarter and increased $57.1 million, or 2 percent, from the prior year second quarter. Excluding the acquisition, all loan categories increased during the current quarter with the largest increase in commercial loans, which increased $93.0 million, or 4 percent. Excluding the acquisition, commercial loans was the one loan category that increased from the prior year second quarter, which increased $106.7 million, or 5 percent, while consumer and other loans decreased $42.8 million, or 7 percent, and residential real estate loans decreased $6.9 million, or 1 percent, from the prior year second quarter.   The decreases in consumer and other loans was primarily attributable to customers paying off home equity lines of credit. 

Credit Quality Summary

       
  At or for the Six
Months ended
At or for the
Year ended
At or for the Six
Months ended
(Dollars in thousands) June 30, December 31, June 30,
  2013 2012 2012
Allowance for loan and lease losses      
Balance at beginning of period  $ 130,854 137,516 137,516
Provision for loan losses 3,178 21,525 16,550
Charge-offs (5,885) (34,672) (19,737)
Recoveries 2,736 6,485 3,130
Balance at end of period  $ 130,883 130,854 137,459
       
Other real estate owned  $ 40,713 45,115 69,170
Accruing loans 90 days or more past due 456 1,479 3,267
Non-accrual loans 89,355 96,933 126,463
Total non-performing assets 1  $ 130,524 143,527 198,900
       
Non-performing assets as a percentage of subsidiary assets 1.64% 1.87% 2.69%
Allowance for loan and lease losses as a percentage of non-performing loans 146% 133% 106%
Allowance for loan and lease losses as a percentage of total loans 3.56% 3.85% 3.99%
Net charge-offs as a percentage of total loans 0.09% 0.83% 0.48%
Accruing loans 30-89 days past due  $ 22,062 27,097 48,707

__________

1 As of June 30, 2013, non-performing assets have not been reduced by U.S. government guarantees of $2.9 million.

During the first half of 2013, the Company continued to maintained the positive trend of reducing non-performing assets that was established throughout 2012. Non-performing assets at June 30, 2013 were $131 million, a decrease of $4.9 million, or 4 percent, during the current quarter and a decrease of $68.4 million, or 34 percent, from a year ago. The largest category of non-performing assets was the land, lot and other construction category which was $57.9 million, or 44 percent, of the non-performing assets at June 30, 2013. Included in this category was $26.0 million of land development loans and $15.6 million in unimproved land loans at June 30, 2013. The Company has continued to reduce the land, lot and other construction category over the prior two and one-half years. This category of non-performing assets was further reduced by $4.4 million, or 7 percent, during the current quarter. 

"The quarter saw noted improvement in early stage delinquencies and further reduction in net charge offs," said Blodnick. "Net charge-offs through the first half of the year are trending at less than one third our expectations, and if that pace continues through the second half of the year would once again approach levels we experienced historically prior to the credit crisis," Blodnick said. "Including the pending acquisition of North Cascades National Bank, we are also fortunate to be adding two new bank partners that bring excellent credit quality to our Company along with further diversification of our loan portfolio." The Company's early stage delinquencies (accruing loans 30-89 days past due) of $22.1 million at June 30, 2013 decreased $10.2 million, or 32 percent, from the prior quarter and decreased $26.6 million, or 55 percent, from the prior year second quarter early stage delinquencies.

At June 30, 2013, the allowance for loan and lease losses ("allowance") was $131 million, a decrease of $6.6 million from a year ago. The allowance was 3.56 percent of total loans outstanding at June 30, 2013, a decrease of 28 basis points from 3.84 percent at March 31, 2013, of which 17 basis points was attributable to no allowance being carried over from the First State Bank acquisition. The allowance was 146 percent of non-performing loans at June 31, 2013, an increase from 133 percent at December 31, 2012 and an increase from 106 percent at June 30, 2012.

Credit Quality Trends and Provision for Loan Losses

           
(Dollars in thousands)


Provision
for Loan
Losses 



Net
Charge-Offs 


ALLL
as a Percent
of Loans 
Accruing
Loans 30-89
Days Past Due
as a Percent of
Loans

Non-Performing
Assets to
Total Subsidiary
Assets 
Second quarter 2013  $ 1,078 1,030 3.56% 0.60% 1.64%
First quarter 2013 2,100 2,119 3.84% 0.95% 1.79%
Fourth quarter 2012 2,275 8,081 3.85% 0.80% 1.87%
Third quarter 2012 2,700 3,499 4.01% 0.83% 2.33%
Second quarter 2012 7,925 7,052 3.99% 1.41% 2.69%
First quarter 2012 8,625 9,555 3.98% 1.24% 2.91%
Fourth quarter 2011 8,675 9,252 3.97% 1.42% 2.92%
Third quarter 2011 17,175 18,877 3.92% 0.60% 3.49%

The Company continued to experience another quarter of decreases in net charged-off loans with the improved credit quality. Net charged-off loans of $1.0 million during the current quarter decreased $1.1 million, or 51 percent, compared to the prior quarter and decreased $6.0 million, or 85 percent, from the prior year second quarter. The current quarter provision for loan losses of $1.1 million decreased $1.0 million from the prior quarter and decreased $6.8 million from the prior year second quarter. Loan portfolio growth, composition, average loan size, credit quality considerations, and other environmental factors will continue to determine the level of provision for loan loss expense. 

Supplemental information regarding credit quality and identification of the Company's loan portfolio based on regulatory classification is provided in the exhibits at the end of this press release. The regulatory classification of loans is based primarily on collateral type while the Company's loan segments presented herein are based on the purpose of the loan.

Liability Summary

           
        $ Change from $ Change from
(Dollars in thousands) June 30, December 31, June 30, December 31, June 30,
  2013 2012 2012 2012 2012
Non-interest bearing deposits  $ 1,236,104 1,191,933 1,066,662 44,171 169,442
Interest bearing deposits 4,122,093 4,172,528 3,915,607 (50,435) 206,486
Repurchase agreements 300,024 289,508 466,784 10,516 (166,760)
FHLB advances 1,217,445 997,013 906,029 220,432 311,416
Other borrowed funds 8,489 10,032 9,973 (1,543) (1,484)
Subordinated debentures 125,490 125,418 125,347 72 143
Other liabilities 58,169 60,059 67,519 (1,890) (9,350)
Total liabilities  $ 7,067,814 6,846,491 6,557,921 221,323 509,893

Non-interest bearing deposits of $1.236 billion increased $44.2 million, or 4 percent, from December 31, 2012 and increased $169 million, or 16 percent, from June 30, 2012. Excluding non-interest bearing deposits of $30.8 million from the First State Bank acquisition, non-interest bearing deposits at June 30, 2013 increased $13.4 million, or 1 percent, since December 31, 2012 and increased $139 million, or 13 percent, since June 30, 2012. 

Interest bearing deposits of $4.122 billion at June 30, 2013 included $372 million of wholesale deposits (i.e., brokered deposits classified as NOW, money market deposit and certificate accounts). Excluding interest bearing deposits of $224 million from the First State Bank acquisition, interest bearing deposits at June 30, 2013 decreased $275 million, or 7 percent, since December 31, 2012 and was primarily a result of a decrease of $262 million in wholesale deposits. Excluding the acquisition, interest bearing deposits at June 30, 2013 decreased $18.0 million, or less than 1 percent, from June 30, 2012 and included a decrease of $97.6 million in wholesale deposits. 

Repurchase agreements of $300 million at June 30, 2013 decreased $167 million, or 36 percent, from the prior year second quarter and was primarily due to a decrease of $185 million in wholesale repurchase agreements. Federal Home Loan Bank ("FHLB") advances increased $220 million from the prior year end and increased $311 million since the prior year second quarter as a result of decreased brokered deposits or wholesale repurchase agreements and the increased need for funding.

Stockholders' Equity Summary

           
(Dollars in thousands, except per share data)       $ Change from $ Change from
  June 30, 2013 December 31, 2012 June 30, 2012 December 31, 2012 June 30, 2012
Common equity  $ 905,620 852,987 832,128 52,633 73,492
Accumulated other comprehensive income 23,382 47,962 44,053 (24,580) (20,671)
Total stockholders' equity 929,002 900,949 876,181 28,053 52,821
Goodwill and core deposit intangible, net (126,771) (112,274) (113,297) (14,497) (13,474)
Tangible stockholders' equity  $ 802,231 788,675 762,884 13,556 39,347
           
Stockholders' equity to total assets 11.62% 11.63% 11.79%    
Tangible stockholders' equity to total tangible assets 10.19% 10.33% 10.42%    
Book value per common share  $ 12.63 12.52 12.18 0.11 0.45
Tangible book value per common share  $ 10.91 10.96 10.61 (0.05) 0.30
Market price per share at end of period  $ 22.19 14.71 15.46 7.48 6.73

Tangible stockholders' equity of $802 million increased $13.6 million, or 2 percent, from the prior year end as a result of stock issued in connection with the acquisition of First State Bank and an increase in earnings retention which was offset by the decrease in accumulated other comprehensive income.   Tangible book value per common share of $10.91 decreased $0.05 per share from the prior year end as a result of the increased stock issued from the acquisition.  

Cash Dividend

On June 27, 2013, the Company's Board of Directors declared a cash dividend of $0.15 per share, payable July 18, 2013 to shareholders of record on July 9, 2013. Future cash dividends will depend on a variety of factors, including net income, capital, asset quality, general economic conditions and regulatory considerations.

         
Operating Results for Three Months Ended June 30, 2013
Compared to March 31, 2013 and June 30, 2012
         
Revenue Summary        
         
  Three Months ended  
(Dollars in thousands) June 30, March 31, June 30,  
  2013 2013 2012  
Net interest income        
Interest income  $ 62,151 57,955 64,192  
Interest expense 7,185 7,458 9,044  
Total net interest income 54,966 50,497 55,148  
         
Non-interest income        
Service charges, loan fees, and other fees 12,971 11,675 12,404  
Gain on sale of loans 7,472 9,089 7,522  
Gain (loss) on sale of investments 241 (137)  
Other income 2,538 2,323 1,865  
Total non-interest income 23,222 22,950 21,791  
   $ 78,188 73,447 76,939  
Net interest margin (tax-equivalent) 3.30% 3.14% 3.49%  
         
         
  $ Change from $ Change from % Change from % Change from
(Dollars in thousands) March 31, June 30, March 31, June 30,
  2013 2012 2013 2012
Net interest income        
Interest income  $ 4,196 $ (2,041) 7% (3)%
Interest expense (273) (1,859) (4)% (21)%
Total net interest income 4,469 (182) 9% —%
         
Non-interest income        
Service charges, loan fees, and other fees 1,296 567 11% 5%
Gain on sale of loans (1,617) (50) (18)% (1)%
Gain (loss) on sale of investments 378 241 (276)% n/m
Other income 215 673 9% 36%
Total non-interest income 272 1,431 1% 7%
   $ 4,741  $ 1,249 6% 2%

_______

n/m - not measurable

Net Interest Income

The current quarter net interest income of $55.0 million increased $4.5 million, or 9 percent, over the prior quarter and decreased $182 thousand, or less than 1 percent, over the prior year second quarter. The current quarter interest income of $62.2 million increased $4.2 million, or 7 percent, over the prior quarter primarily as a result of the increase in interest income on the commercial loans and the increase in interest income on the investment portfolio. The current quarter increase in interest income on the investment portfolio was primarily a result of a decrease in premium amortization (net of discount accretion) on the investment securities ("premium amortization"). The Company has experienced a decrease in premium amortization for a second consecutive quarter, which has been a benefit to the Company compared to the significant increases experienced during the preceding seven quarters. Included in the current quarter interest income was $18.4 million of premium amortization on investment securities compared to $21.4 million in the prior quarter. The current quarter decrease in premium amortization on investment securities was $3.0 million during the current quarter compared to a decrease of $1.9 million in premium amortization in the prior quarter. 

The current quarter interest expense of $7.2 million decreased 273 thousand, or 4 percent, from the prior quarter and decreased $1.9 million, or 21 percent, from the prior year second quarter. The cost of total funding (including non-interest bearing deposits) for the current quarter was 43 basis points compared to 46 basis points for the prior quarter and 57 basis points for the prior year second quarter. 

The current quarter net interest margin as a percentage of earning assets, on a tax-equivalent basis, was 3.30 percent, an increase of 16 basis points from the prior quarter net interest margin of 3.14 percent. Consistent with the prior quarter increase in the net interest margin, the increase during the current quarter was primarily attributable to the increased yield on the investment securities which was driven by a decrease in the premium amortization. Of the 33 basis points increase in yield on the investment securities in the current quarter, 34 basis points was due to the decrease in premium amortization. The premium amortization in the current quarter accounted for a 103 basis points reduction in the net interest margin compared to a 123 basis points reduction in the prior quarter and 94 basis points reduction in the net interest margin in the prior year second quarter. "We saw further improvement in our net interest margin as premium amortization continued to decline," said Ron Copher, Chief Financial Officer.  "We're hopeful the second half of the year will allow this trend to continue and a combination of slower refinance volume, a change in the mix of our investments, and much better loan growth all contribute to an increase in interest income."

Non-interest Income

Non-interest income for the current quarter totaled $23.2 million, an increase of $272 thousand over the prior quarter and an increase of $1.4 million over the same quarter last year. Service charge fee income increased $1.3 million, or 11 percent, from the prior quarter as a result of seasonal activity. Service charge fee income increased $567 thousand, or 5 percent, from the prior year second quarter. Although refinance activity remained historically elevated, gain of $7.5 million on the sale of loans for the current quarter decreased $1.6 million, or 18 percent, from the prior quarter as the Company has started to experience a slowing of refinance activity. Gain on sale of loans for the current quarter decreased $50 thousand, or 66 basis points, from the prior year second quarter. Other income of $2.5 million for the current quarter increased $673 thousand, or 36 percent, from the prior year second quarter primarily as a result of increases in income related to other real estate owned. Included in other income was operating revenue of $93 thousand from other real estate owned and gain of $622 thousand on the sales of other real estate owned, which totaled $715 thousand for the current quarter compared to $726 thousand for the prior quarter and $414 thousand for the prior year second quarter.

Non-interest Expense Summary

         
  Three Months ended  
(Dollars in thousands) June 30, March 31, June 30,  
  2013 2013 2012  
Compensation and employee benefits  $ 24,917 24,577 23,684  
Occupancy and equipment 5,906 5,825 5,825  
Advertising and promotions 1,621 1,548 1,713  
Outsourced data processing 813 825 788  
Other real estate owned 2,968 884 2,199  
Federal Deposit Insurance Corporation premiums 1,154 1,304 1,300  
Core deposit intangibles amortization 505 486 535  
Other expense 10,597 7,985 10,146  
Total non-interest expense  $ 48,481 43,434 46,190  
         
         
  $ Change from $ Change from % Change from % Change from
(Dollars in thousands) March 31, June 30, March 31, June 30,
  2013 2012 2013 2012
Compensation and employee benefits  $ 340  $ 1,233 1% 5%
Occupancy and equipment 81 81 1% 1%
Advertising and promotions 73 (92) 5% (5)%
Outsourced data processing (12) 25 (1)% 3%
Other real estate owned 2,084 769 236% 35%
Federal Deposit Insurance Corporation premiums (150) (146) (12)% (11)%
Core deposit intangibles amortization 19 (30) 4% (6)%
Other expense 2,612 451 33% 4%
Total non-interest expense  $ 5,047  $ 2,291 12% 5%

Non-interest expense of $48.5 million for the current quarter increased by $5.0 million, or 12 percent, from the prior quarter and increased by $2.3 million, or 5 percent, from the prior year second quarter. Compensation and employee benefits increased by $340 thousand, or 1 percent, from the prior quarter and increased $1.2 million, or 5 percent, from the prior year second quarter as a result of the First State Bank acquisition and annual salary increases. Other real estate owned expense increased $2.1 million, or 236 percent, from the prior quarter and increased $769 thousand, or 35 percent, from the prior year second quarter. The current quarter other real estate owned expense of $3.0 million included $1.2 million of operating expense, $1.7 million of fair value write-downs, and $67 thousand of loss on sale of other real estate owned. Other real estate owned expense will fluctuate as the Company continues to work through non-performing loans and dispose of foreclosed properties.    Other expense increased by $2.6 million, or 33 percent, from the prior quarter primarily from legal and professional expenses associated with the acquisition and expenses connected with New Market Tax Credit investments.

Efficiency Ratio

The efficiency ratio for the current quarter was 56 percent compared to 54 percent for the prior year second quarter. The increase in the efficiency ratio was primarily driven by the increase in non-interest expense.

         
Operating Results for Six Months ended June 30, 2013
Compared to June 30, 2012
         
Revenue Summary        
         
  Six Months ended    
(Dollars in thousands) June 30, June 30,    
  2013 2012 $ Change  % Change 
Net interest income        
Interest income  $ 120,106  $ 132,076 $ (11,970) (9)%
Interest expense 14,643 18,642 (3,999) (21)%
Total net interest income 105,463 113,434 (7,971) (7)%
         
Non-interest income        
Service charges, loan fees, and other fees 24,646 23,842 804 3%
Gain on sale of loans 16,561 14,335 2,226 16%
Gain on sale of investments 104 104 n/m
Other income 4,861 3,952 909 23%
Total non-interest income 46,172 42,129 4,043 10%
   $ 151,635  $ 155,563 $ (3,928) (3)%
Net interest margin (tax-equivalent) 3.23% 3.61%    

_______

n/m - not measurable

Net Interest Income

Net interest income for the first six months of the current year decreased $8.0 million, or 7 percent, over the same period last year. Interest income decreased $12.0 million, or 9 percent, while interest expense decreased $4.0 million, or 21 percent, from the first six months of 2012 and was principally due to the increase in premium amortization on investment securities and the reduction of yields on loan balances. Interest income was reduced by $39.8 million in premium amortization on investment securities which was an increase of $10.6 million from the first six months of the prior year. The decrease in interest expense during the current year was primarily attributable to the decreases in interest rates on interest bearing deposits and borrowings.  The funding cost (including non-interest bearing deposits) for the first six months of 2013 was 44 basis points compared to 59 basis points for the first six months 2012. 

The net interest margin, on a tax-equivalent basis, for the first six months of 2013 was 3.23 percent, a 38 basis points reduction from the net interest margin of 3.61 percent for the first six months of 2012. The reduction was attributable to a lower yield on loans and higher premium amortization on investment securities, both of which outpaced the reduction in funding cost. The premium amortization for the first six months of 2013 accounted for a 111 basis points reduction in the net interest margin which was an increase of 24 basis points compared to the 87 basis points reduction in the net interest margin for the same period last year. 

Non-interest Income

Non-interest income of $46.2 million for the first six months of 2013 increased $4.0 million, or 10 percent, over the same period last year. Gain on sale of loans for the first six months of 2013 increased $2.2 million, or 16 percent, from the first six months of 2012 as a result of greater refinance volume, which has recently started to slow down, and loan origination activity. Other income for the first six months of 2013 increased $909 thousand, or 23 percent, over the first six months of 2012. Included in other income was operating revenue of $155 thousand from other real estate owned and gains of $1.3 million on the sale of other real estate owned, which aggregated $1.4 million for the first six months of 2013 compared to $942 thousand for the same period in the prior year.

Non-interest Expense Summary

         
  Six Months ended    
(Dollars in thousands) June 30, June 30,    
  2013 2012 $ Change  % Change 
Compensation and employee benefits  $ 49,494 47,244 2,250 5%
Occupancy and equipment 11,731 11,793 (62) (1)%
Advertising and promotions 3,169 3,115 54 2%
Outsourced data processing 1,638 1,634 4 —%
Other real estate owned 3,852 9,021 (5,169) (57)%
Federal Deposit Insurance Corporation premiums 2,458 3,012 (554) (18)%
Core deposit intangibles amortization 991 1,087 (96) (9)%
Other expense 18,582 18,329 253 1%
Total non-interest expense  $ 91,915 95,235 (3,320) (3)%

Compensation and employee benefits for the first six months of 2013 increased $2.3 million, or 5 percent. Other real estate owned expense of $3.9 million in the first six months of 2013 decreased $5.2 million, or 57 percent, from the first six months of the prior year. The other real estate owned expense for the first six months of 2013 included $1.6 million of operating expenses, $2.0 million of fair value write-downs, and $302 thousand of loss on sale of other real estate owned.  

Provision for loan losses

The provision for loan losses was $3.2 million for the first six months of 2013, a decrease of $13.4 million, or 81 percent, from the same period in the prior year. Net charged-off loans during the first half of 2013 was $3.2 million, a decrease of $13.5 million from the first six months of 2012. 

Efficiency Ratio

The efficiency ratio was 55 percent for the first six months of 2013 and 53 percent for the first six months of 2012. Although there was an increase in non-interest income from the first six months of the prior year, it was not enough to offset the decrease in net interest income which resulted in the increase in the efficiency ratio.

About Glacier Bancorp, Inc.

Glacier Bancorp, Inc. is a regional bank holding company providing commercial banking services in 63 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and  is the parent company for Glacier Bank, Kalispell and bank divisions First Security Bank of Missoula; Valley Bank of Helena; Big Sky Western Bank, Bozeman; Western Security Bank, Billings; and First Bank of Montana, Lewistown; all operating in Montana; as well as Mountain West Bank, Coeur d'Alene operating in Idaho, Utah and Washington; Citizens Community Bank, Pocatello, operating in Idaho; 1st Bank, Evanston, operating in Wyoming and Utah;  First Bank of Wyoming, Powell and First State Bank, Wheatland,   operating in Wyoming; and Bank of the San Juans, Durango, operating in Colorado.

Forward Looking Statements

This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about management's plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as "expects," "anticipates," "intends," "plans," "believes," "should," "projects," "seeks," "estimates" or words of similar meaning. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations in the forward-looking statements, including those set forth in this news release:

  • the risks associated with lending and potential adverse changes of the credit quality of loans in the Company's portfolio, including as a result of a slow recovery in the housing and real estate markets in its geographic areas;
  • increased loan delinquency rates;
  • the risks presented by a slow economic recovery, which could adversely affect credit quality, loan collateral values, other real estate owned values, investment values, liquidity and capital levels, dividends and loan originations;
  • changes in market interest rates, which could adversely affect the Company's net interest income and profitability;
  • legislative or regulatory changes that adversely affect the Company's business, ability to complete pending or prospective future acquisitions, limit certain sources of revenue, or increase cost of operations;
  • costs or difficulties related to the completion and integration of acquisitions;
  • the goodwill the Company has recorded in connection with acquisitions could become additionally impaired, which may have an adverse impact on earnings and capital;
  • reduced demand for banking products and services;
  • the risks presented by public stock market volatility, which could adversely affect the market price of the Company's common stock and the ability to raise additional capital in the future;
  • competition from other financial services companies in the Company's markets;
  • loss of services from the CEO and senior management team;
  • potential interruption or breach in security of the Company's systems; and
  • the Company's success in managing risks involved in the foregoing.

The Company does not undertake any obligation to publicly correct or update any forward-looking statement if it later becomes aware that actual results are likely to differ materially from those expressed in such forward-looking statement.

         
Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Financial Condition
         
         
(Dollars in thousands, except per share data) June 30, 2013 March 31, 2013 December 31, 2012 June 30, 2012
Assets        
Cash on hand and in banks  $ 105,272 88,132 123,270 92,119
Interest bearing cash deposits and federal funds sold 27,184 40,925 63,770 48,300
Cash and cash equivalents 132,456 129,057 187,040 140,419
Investment securities, available-for-sale 3,721,377 3,658,037 3,683,005 3,404,282
Loans held for sale 95,495 88,035 145,501 88,442
Loans receivable 3,673,456 3,403,845 3,397,425 3,445,196
Allowance for loan and lease losses (130,883) (130,835) (130,854) (137,459)
Loans receivable, net 3,542,573 3,273,010 3,266,571 3,307,737
Premises and equipment, net 161,918 159,224 158,989 159,432
Other real estate owned 40,713 43,975 45,115 69,170
Accrued interest receivable 43,593 39,024 37,770 37,108
Deferred tax asset 35,115 17,449 20,394 22,892
Core deposit intangible, net 7,262 5,688 6,174 7,197
Goodwill 119,509 106,100 106,100 106,100
Non-marketable equity securities 49,752 48,812 48,812 50,371
Other assets 47,053 40,826 41,969 40,952
Total assets  $ 7,996,816 7,609,237 7,747,440 7,434,102
         
Liabilities        
Non-interest bearing deposits  $ 1,236,104 1,180,738 1,191,933 1,066,662
Interest bearing deposits 4,122,093 4,192,477 4,172,528 3,915,607
Securities sold under agreements to repurchase 300,024 312,505 289,508 466,784
Federal Home Loan Bank advances 1,217,445 802,004 997,013 906,029
Other borrowed funds 8,489 10,276 10,032 9,973
Subordinated debentures 125,490 125,454 125,418 125,347
Accrued interest payable 3,824 4,095 4,675 5,076
Other liabilities 54,345 67,408 55,384 62,443
Total liabilities 7,067,814 6,694,957 6,846,491 6,557,921
         
Stockholders' Equity        
Preferred shares, $0.01 par value per share, 1,000,000 shares authorized, none issued or outstanding
Common stock, $0.01 par value per share, 117,187,500 shares authorized 736 720 719 719
Paid-in capital 672,035 642,285 641,737 641,656
Retained earnings - substantially restricted 232,849 221,200 210,531 189,753
Accumulated other comprehensive income 23,382 50,075 47,962 44,053
Total stockholders' equity 929,002 914,280 900,949 876,181
Total liabilities and stockholders' equity  $ 7,996,816 7,609,237 7,747,440 7,434,102
         
Number of common stock shares issued and outstanding 73,564,900 72,018,617 71,937,222 71,931,386
           
Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Operations
           
           
  Three Months ended Six Months ended
(Dollars in thousands, except per share data) June 30, March 31, June 30, June 30, June 30,
  2013 2013 2012 2013 2012
Interest Income          
Residential real estate loans  $ 7,026 7,260 7,495 14,286 15,279
Commercial loans 29,865 28,632 30,430 58,497 61,471
Consumer and other loans 7,909 7,864 8,813 15,773 17,983
Investment securities 17,351 14,199 17,454 31,550 37,343
Total interest income 62,151 57,955 64,192 120,106 132,076
           
Interest Expense          
Deposits 3,474 3,712 4,609 7,186 9,563
Securities sold under agreements to repurchase 210 227 303 437 602
Federal Home Loan Bank advances 2,648 2,651 3,218 5,299 6,599
Federal funds purchased and other borrowed funds 54 52 61 106 123
Subordinated debentures 799 816 853 1,615 1,755
Total interest expense 7,185 7,458 9,044 14,643 18,642
           
Net Interest Income 54,966 50,497 55,148 105,463 113,434
Provision for loan losses 1,078 2,100 7,925 3,178 16,550
Net interest income after provision for loan losses 53,888 48,397 47,223 102,285 96,884
           
Non-Interest Income          
Service charges and other fees 11,818 10,586 11,291 22,404 21,783
Miscellaneous loan fees and charges 1,153 1,089 1,113 2,242 2,059
Gain on sale of loans 7,472 9,089 7,522 16,561 14,335
Gain (loss) on sale of investments 241 (137) 104
Other income 2,538 2,323 1,865 4,861 3,952
Total non-interest income 23,222 22,950 21,791 46,172 42,129
           
Non-Interest Expense          
Compensation and employee benefits 24,917 24,577 23,684 49,494 47,244
Occupancy and equipment 5,906 5,825 5,825 11,731 11,793
Advertising and promotions 1,621 1,548 1,713 3,169 3,115
Outsourced data processing 813 825 788 1,638 1,634
Other real estate owned 2,968 884 2,199 3,852 9,021
Federal Deposit Insurance Corporation premiums 1,154 1,304 1,300 2,458 3,012
Core deposit intangibles amortization 505 486 535 991 1,087
Other expense 10,597 7,985 10,146 18,582 18,329
Total non-interest expense 48,481 43,434 46,190 91,915 95,235
           
Income Before Income Taxes 28,629 27,913 22,824 56,542 43,778
Federal and state income tax expense 5,927 7,145 3,843 13,072 8,464
           
Net Income  $ 22,702 20,768 18,981 43,470 35,314
Basic earnings per share  $ 0.31 0.29 0.26 0.60 0.49
Diluted earnings per share  $ 0.31 0.29 0.26 0.60 0.49
Dividends declared per share  $ 0.15 0.14 0.13 0.29 0.26
Average outstanding shares - basic 72,480,019 71,965,665 71,928,697 72,224,263 71,921,885
Average outstanding shares - diluted 72,548,172 72,013,177 71,928,853 72,282,104 71,921,990
             
Glacier Bancorp, Inc.
Average Balance Sheet
             
             
  Three Months ended Six Months ended
  June 30, 2013 June 30, 2013
(Dollars in thousands)     Average     Average
  Average Interest & Yield/ Average Interest & Yield/
  Balance  Dividends  Rate Balance  Dividends  Rate
Assets            
Residential real estate loans  $ 594,543 7,026 4.73%  $ 606,133 14,286 4.71%
Commercial loans 2,381,231 29,865 5.03% 2,326,455 58,497 5.07%
Consumer and other loans 587,728 7,909 5.40% 587,581 15,773 5.41%
Total loans 1 3,563,502 44,800 5.04% 3,520,169 88,556 5.07%
Tax-exempt investment securities 2 1,025,295 15,229 5.94% 992,693 29,379 5.92%
Taxable investment securities 3 2,696,142 7,174 1.06% 2,691,461 11,946 0.89%
Total earning assets 7,284,939 67,203 3.70% 7,204,323 129,881 3.64%
Goodwill and intangibles 116,356     114,208    
Non-earning assets 349,175     349,088    
Total assets  $ 7,750,470      $ 7,667,619    
             
Liabilities            
Non-interest bearing deposits  $ 1,177,041 —%  $ 1,159,210
NOW accounts 969,412 285 0.12% 967,616 558 0.12%
Savings accounts 513,840 58 0.05% 504,957 131 0.05%
Money market deposit accounts 999,353 497 0.20% 998,227 1,011 0.20%
Certificate accounts 1,120,206 2,292 0.82% 1,101,274 4,719 0.86%
Wholesale deposits 4 552,539 342 0.25% 565,790 767 0.27%
FHLB advances 1,001,899 2,648 1.06% 961,997 5,299 1.11%
Repurchase agreements, federal funds purchased and other borrowed funds 424,246 1,063 1.00% 425,960 2,158 1.02%
Total funding liabilities 6,758,536 7,185 0.43% 6,685,031 14,643 0.44%
Other liabilities 60,553     59,168    
Total liabilities 6,819,089     6,744,199    
             
Stockholders' Equity            
Common stock 725     722    
Paid-in capital 651,939     646,995    
Retained earnings 233,104     226,806    
Accumulated other comprehensive income 45,613     48,897    
Total stockholders' equity 931,381     923,420    
Total liabilities and stockholders' equity  $ 7,750,470      $ 7,667,619    
Net interest income (tax-equivalent)    $ 60,018      $ 115,238  
Net interest spread (tax-equivalent)     3.27%     3.20%
Net interest margin (tax-equivalent)     3.30%     3.23%

__________

Total loans are gross of the allowance for loan and lease losses, net of unearned income and include loans held for sale. Non-accrual loans were included in the average volume for the entire period.

Includes tax effect of $4.7 million and $9.0 million on tax-exempt investment security income for the three and six months ended June 30, 2013, respectively.

Includes tax effect of $379 thousand and $760 thousand on investment security tax credits for the three and six months ended June 30, 2013, respectively.

Wholesale deposits include brokered deposits classified as NOW, money market deposit and certificate accounts.

           
Glacier Bancorp, Inc.
Loan Portfolio by Regulatory Classification
           
  Loans Receivable, by Loan Type % Change from % Change from
(Dollars in thousands)

June 30, 2013
December 31,
2012

June 30, 2012
December 31,
2012

June 30, 2012
Custom and owner occupied construction  $ 35,529 40,327 39,052 (12)% (9)%
Pre-sold and spec construction 36,967 34,970 49,638 6% (26)%
Total residential construction 72,496 75,297 88,690 (4)% (18)%
           
Land development 77,080 80,132 93,361 (4)% (17)%
Consumer land or lots 100,549 104,229 114,475 (4)% (12)%
Unimproved land 50,492 53,459 59,548 (6)% (15)%
Developed lots for operative builders 15,105 16,675 21,101 (9)% (28)%
Commercial lots 16,987 19,654 25,035 (14)% (32)%
Other construction 90,735 56,109 32,079 62% 183%
Total land, lot, and other construction 350,948 330,258 345,599 6% 2%
           
Owner occupied 753,692 710,161 701,078 6% 8%
Non-owner occupied 475,991 452,966 444,419 5% 7%
Total commercial real estate 1,229,683 1,163,127 1,145,497 6% 7%
           
Commercial and industrial 470,178 420,459 413,908 12% 14%
1st lien 718,793 738,854 690,638 (3)% 4%
Junior lien 77,359 82,083 87,544 (6)% (12)%
Total 1-4 family 796,152 820,937 778,182 (3)% 2%
           
Home equity lines of credit 304,859 319,779 338,459 (5)% (10)%
Other consumer 123,947 109,019 109,043 14% 14%
Total consumer 428,806 428,798 447,502 —% (4)%
           
Agriculture 238,136 145,890 162,534 63% 47%
Other 182,552 158,160 151,726 15% 20%
Loans held for sale (95,495) (145,501) (88,442) (34)% 8%
Total  $ 3,673,456 3,397,425 3,445,196 8% 7%
             
Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification
             
        Non- Accruing Other
        Accruing Loans 90  Days Real Estate
  Non-performing Assets, by Loan Type Loans or More Past Due Owned
(Dollars in thousands) June 30, December 31, June 30, June 30, June 30, June 30,
  2013 2012 2012 2013 2013 2013
Custom and owner occupied construction  $ 1,291 1,343 2,914 1,291
Pre-sold and spec construction 1,319 1,603 7,473 571 748
Total residential construction 2,610 2,946 10,387 1,862 748
             
Land development 26,004 31,471 47,154 15,591 10,413
Consumer land or lots 5,475 6,459 9,728 2,138 3,337
Unimproved land 15,611 19,121 28,914 13,259 2,352
Developed lots for operative builders 2,093 2,393 6,932 1,356 737
Commercial lots 3,185 1,959 2,581 318 2,867
Other construction 5,532 5,105 5,124 189 5,343
Total land, lot and other construction 57,900 66,508 100,433 32,851 25,049
             
Owner occupied 16,503 15,662 18,210 11,897 4,606
Non-owner occupied 5,091 4,621 3,509 3,525 1,566
Total commercial real estate 21,594 20,283 21,719 15,422 6,172
             
Commercial and industrial 7,103 5,970 8,077 7,030 22 51
1st lien 22,543 25,739 34,285 17,646 297 4,600
Junior lien 5,819 6,660 8,861 5,716 103
Total 1-4 family 28,362 32,399 43,146 23,362 297 4,703
             
Home equity lines of credit 6,107 8,041 6,939 5,483 90 534
Other consumer 449 441 405 244 47 158
Total consumer 6,556 8,482 7,344 5,727 137 692
             
Agriculture 6,146 6,686 7,541 3,101 3,045
Other 253 253 253 253
Total  $ 130,524 143,527 198,900 89,355 456 40,713

           
Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)
           
           
  Accruing 30-89 Days Delinquent Loans,  by Loan Type % Change from % Change from
(Dollars in thousands) June 30, December 31, June 30, December 31, June 30,
  2013 2012 2012 2012 2012
Custom and owner occupied construction $ — 5 (100)% n/m
Pre-sold and spec construction 893 968 (100)% (100)%
Total residential construction 898 968 (100)% (100)%
           
Land development 191 460 (100)% (100)%
Consumer land or lots 338 762 1,650 (56)% (80)%
Unimproved land 341 422 1,129 (19)% (70)%
Developed lots for operative builders 146 422 199 (65)% (27)%
Commercial lots 11 (100)% n/m
Total land, lot and other construction 825 1,808 3,438 (54)% (76)%
           
Owner occupied 7,297 5,523 10,943 32% (33)%
Non-owner occupied 2,247 2,802 950 (20)% 137%
Total commercial real estate 9,544 8,325 11,893 15% (20)%
           
Commercial and industrial 3,844 1,905 20,847 102% (82)%
1st lien 2,807 7,352 7,220 (62)% (61)%
Junior lien 980 732 880 34% 11%
Total 1-4 family 3,787 8,084 8,100 (53)% (53)%
           
Home equity lines of credit 3,138 4,164 2,541 (25)% 23%
Other consumer 755 1,001 698 (25)% 8%
Total consumer 3,893 5,165 3,239 (25)% 20%
           
Agriculture 169 912 222 (81)% (24)%
Total  $ 22,062 27,097 48,707 (19)% (55)%

_______

n/m - not measurable

           
Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)
           
           
  Net Charge-Offs (Recoveries), Year-to-Date    
  Period Ending, By Loan Type Charge-Offs Recoveries
(Dollars in thousands) June 30, December 31, June 30, June 30, June 30,
  2013 2012 2012 2013 2013
Custom and owner occupied construction $ (1) 24 1
Pre-sold and spec construction (16) 2,489 2,393 16
Total residential construction (17) 2,513 2,393 17
           
Land development (76) 3,035 2,706 247 323
Consumer land or lots 290 4,003 1,957 580 290
Unimproved land 233 636 517 256 23
Developed lots for operative builders (11) 1,802 1,201 73 84
Commercial lots 251 362 (81) 254 3
Other construction (128) 128
Total land, lot and other construction 559 9,838 6,300 1,410 851
           
Owner occupied (306) 1,312 1,318 407 713
Non-owner occupied 268 597 189 288 20
Total commercial real estate (38) 1,909 1,507 695 733
           
Commercial and industrial 823 2,651 819 1,374 551
1st lien 287 5,257 2,122 412 125
Junior lien 56 3,464 2,441 160 104
Total 1-4 family 343 8,721 4,563 572 229
           
Home equity lines of credit 1,346 2,124 807 1,466 120
Other consumer 141 262 32 344 203
Total consumer 1,487 2,386 839 1,810 323
           
Agriculture 21 125 94 21
Other (29) 44 92 3 32
Total  $ 3,149 28,187 16,607 5,885 2,736

Visit our website at www.glacierbancorp.com
 

CONTACT: Michael J. Blodnick
(406) 751-4701
Ron J. Copher
(406) 751-7706

Products
  • Globe Unlimited

    Digital all access pass across devices. subscribe

  • The Globe and Mail Newspaper

    Newspaper delivered to your doorstep. subscribe

  • Globe2Go

    The digital replica of our newspaper. subscribe

  • Globe eBooks

    A collection of articles by the Globe. subscribe

See all Globe Products

Advertise with us

GlobeLink.ca

Your number one partner for reaching Canada's Influential Achievers. learn more

The Globe at your Workplace
Our Company
Customer Service
Globe Recognition
Mobile Apps
NEWS APP
INVESTING APP
Other Sections