Premier Fi­nan­cial Ban­corp re­ports 3Q

The Pak Banker - - Front Page -

WEST VIR­GINIA

Premier Fi­nan­cial Ban­corp Hunt­ing­ton, West Vir­ginia, a $1.1 bil­lion bank hold­ing com­pany with two bank sub­sidiaries, an­nounced its fi­nan­cial re­sults for the third quar­ter of 2012.

Premier re­al­ized in­come of $2,411,000 (37 cents per di­luted share) dur­ing the quar­ter end­ing Septem­ber 30, 2012, a 33.0% in­crease from the $1,813,000 of net in­come re­ported for the third quar­ter of 2011. The in­crease in net in­come in 2012 is largely due to a de­crease in in­ter­est ex­pense, and non-in­ter­est ex­pense. These items more than off­set a de­crease in in­ter­est in­come and non-in­ter­est in­come plus an in­crease in the pro­vi­sion for loan losses. On a di­luted per share ba­sis, Premier earned $0.37 dur­ing the third quar­ter of 2012 com­pared to $0.19 per share earned dur­ing the third quar­ter of 2011. For the first nine months of 2012 Premier re­al­ized net in­come of $7,333,000 (90 cents per di­luted share) com­pared to $4,513,000 (45 cents per di­luted share) earned dur­ing the first nine months of 2011.

Pres­i­dent and CEO Robert W. Walker said we are once again pleased with our quar­terly earn­ings and per share re­sults. It should be noted that while not in­cluded in our re­ported net in­come, our per share re­sults were im­pacted in a pos­i­tive way by the dis­count re­al­ized upon our Au­gust 2012 re­demp­tion of 10,252 shares of our Se­ries A Pre­ferred Stock owned by the U.S. Trea­sury. The ef­fect was to in­crease our earn­ings per share by ap­prox­i­mately 11 cents for the third quar­ter and first nine months of 2012.

With our re­lease from the July 29, 2010 Writ­ten Agree­ment with the Fed­eral Re­serve Bank of Rich­mond ("FRB"), we also re­sumed pay­ing a quar­terly cash div­i­dend to com­mon share­hold­ers at the end of Septem­ber. Our oper­at­ing ex­penses are down be­cause our 2011 data con­ver­sion is be­hind us and we are re­al­iz­ing cost sav­ings on the new sys­tem. We continue to re­al­ize sav­ings in staff costs, equip­ment costs, and sup­plies. In­ter­est ex­pense con- tin­ues to de­crease due to the ex­tended low in­ter­est rate en­vi­ron­ment. How­ever, in­ter­est in­come is also be­ing neg­a­tively af­fected by the ex­tended low in­ter­est rate en­vi­ron­ment, as yields on earn­ing as­sets continue to de­crease. We are re­al­iz­ing some op­por­tu­ni­ties to liq­ui­date trou­bled as­sets for rea­son­able val­ues and continue to work to­ward re­duc­ing our non-per­form­ing loans out­stand­ing.

Net in­ter­est in­come for the quar­ter end­ing Septem­ber 30, 2012 to­taled $11.017 mil­lion, com­pared to $11.214 mil­lion of net in­ter­est in­come earned in the third quar­ter of 2011. When com­pared to the third quar­ter of 2011, net in­ter­est in­come de­creased by $197,000, or 1.8%, largely due to a $493,000 de­crease in in­ter­est in­come earned on loans and an $184,000 de­crease in in­ter­est in­come earned on in­vest­ments. The de­creases in in­ter­est in­come were par­tially off­set by $477,000 of sav­ings on in­ter­est ex­pense. To­tal in­ter­est in­come earned in the third quar­ter of 2012 de­creased by $674,000, or 5.1%, when com­pared to the third quar­ter of 2011, largely due to a $493,000, or 4.4%, de­crease in in­ter­est in­come on loans. The de­crease in in­ter­est in­come on loans is largely due to a $16.7 mil­lion, or 2.4%, de­crease in av­er­age loans out­stand­ing dur­ing the quar­ter com­pared to the third quar­ter of 2011, com­bined with a de­crease in av­er­age loan yields of 13 ba­sis points. More­over, in­ter­est in­come on in­vest­ments de­creased by $184,000, or 9.3%, as yields on in­vest­ments have fallen by 42 ba­sis points when com­pared to the third quar­ter of 2011. To­tal in­ter­est ex­pense in the third quar­ter of 2012 de­creased by $477,000, or 23.4%, when com­pared to the third quar­ter of 2012, largely due to a $393,000, or 22.5%, de­crease in in­ter­est ex­pense on de­posits. Oth­er­wise, a $48,000 de­crease in in­ter­est ex­pense on FHLB ad­vances at the sub­sidiary banks was com­ple­mented by a $21,000, or 10.0%, de­crease in in­ter­est ex­pense on other bor­row­ings at the par­ent com­pany and a $15,000 de­crease in in­ter­est ex­pense on re­pur­chase agree­ments and other short­term bor­row­ings.

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