Bank Financial Analysis – Level I

Bank Financial Analysis Student Packet – Table of Contents
Document
Page Number
Daily Objectives
2
Session Takeaways
5
Key Measures
6
Flow of Components
10
Classroom Presentation & Exercises
12
Extra Net Interest Margin Exercise
36
Case Study – GSBC Bank
following page
Case Study – GSBC Bank
41
Case Study Page #
Summary of Ratios
1
Income Statement
3
Noninterest Income, Expenses and Yields
5
Balance Sheet
7
Off-Balance Sheet Items
9
Balance Sheet % Composition
11
Analysis of Credit Allowance & Loan Mix
13
Analysis of Concentrations of Credit
16
Analysis of Past Due, Nonaccrual & Restructured Debt
17
Liquidity & Investment Portfolio
20
Capital Analysis
23
Michael L. Stevens
Senior Executive Vice President
Conference of State Bank Supervisors
W 202-728-5701
M 703-989-4257
[email protected]
Bank Financial Analysis – Daily Objectives
Day 1: Overall objectives and BFA Strategy
I.
Objectives of the course
a. Key operating ratios
b. Utilize ratio analysis to draw reasonable conclusions
c. Discover relationships between ratios
d. Enhance understanding of own institution
II.
Strategy for a comprehensive bank financial analysis.
a. Asset Quality
b. Earnings Performance
c. Liquidity
d. Sensitivity to Market Risk
e. Capital Adequacy
f. Management
III.
Analysis Fundamentals
a. Ratios over raw numbers
b. Evaluate numerator and denominator
c. Level
d. Trend
IV.
Review of case study – GSBC Bank
Day 2: Evaluating the quality of a bank’s assets
I.
Major risk areas in assets
II.
Quantifiable vs. qualitative factors
III.
A strategy for analyzing asset quality
IV.
Case Study: GSBC Bank
V.
Key asset quality ratios
As of 4/26/13
2
Day 3: Evaluating the quality and quantity of earnings
I.
Understanding the structure of the balance sheet
II.
Four major influences on the net interest margin
a.
b.
c.
d.
Interest income
Interest expense
Earning assets
Interest bearing liabilities
III.
Exercise #1: Analyzing the change in cost of funds
IV.
Exercise #2: Transactional approach to the NIM
V.
Other key factors & measurements of a bank’s earnings
a. Non-interest income
b. Overhead expenses
c. Provisions for loan losses
Day 4: Liquidity & Capital
I.
II.
The definition and importance of liquidity
Symptoms of tight liquidity
III.
Liquidity Measurements
a. Asset based
b. Funding base
c. Off-balance sheet factors
IV.
Understanding the function of capital
V.
VI.
VII.
Capital Measurements
Determining adequate capital
Comprehensive analysis of GSBC Bank
As of 4/26/13
3
Day 5: Management & Review
I.
II.
Management and the regulatory process
Course review utilizing situational analysis
Bank Financial Analysis Level II
Level II will follow the outline for Level I. The instructor anticipates that the experience
of the participants will allow for more detailed discussions of higher level analytical
issues at a slightly faster pace. In place of the case study, the class will conduct a
comprehensive analysis of a bank.
As of 4/26/13
4
Bank Financial Analysis – Session Takeaways
This course will give participants the tools and strategies to evaluate the risk and
performance of their bank. At the end of the course, the participants will:
1. Have a comprehensive strategy for analyzing their bank.
2. Understand how the different components impact each other. (Example: Asset
quality directly impacts earnings performance which impacts liquidity and capital
adequacy).
3. Appreciate the valuable role management, the board of directors, strategy and
operating policies play in an organizations condition and performance.
4. Begin to identify the necessary elements to effectuate change in condition and/or
performance.
As of 4/26/13
5
Bank Financial Analysis – Key Measures
The following will serve as a guide to the calculation and meaning of key ratios used in traditional bank
financial analysis. These are the primary ratios but rarely tell the full story. To conduct a complete
analysis, the analyst will always need to consider other ratios and make connections to other
components.
Asset Composition
(1) Loans / Assets
• % of assets invested in loans
• Requires staff expertise to manage
• Generally, primary source of credit risk
• The higher the %, generally more relative risk and greater risk management expectations
(2) Securities / Assets
• % of assets invested in securities
• The higher the %, generally the more on-balance sheet liquidity
(3) Other Assets / Assets
• Assets that do not generate earnings
• All banks have some level of other assets
• To the extent they represent repossessed property from defaulted loans, may be an asset
quality indicator
Asset Quality
(4) Loans 90+ Days Past Due / Total Loans
• % of loans that are over 90 days past due
• The higher the % the greater the risk in the portfolio and future losses
(5) Nonaccrual / Total Loans
• % of loans that are not accruing interest due to a concern about future collectability
• The higher the % the more assets that are not generating income
(6) Noncurrent Loans / Total Loans
• The sum of the above ratios
6
(7) Net Loss / Total Loans
• Loans charged-off minus recoveries on previous charge-offs
• Losses experienced in the loan portfolio
• A high level or increasing trend indicate an elevated risk and uncertain future
(8) Earnings Coverage of Net Losses (X)
• The number of times that the bank’s net income covered losses
• A positive number indicates that the bank is able to cover its losses through normal earnings
• A negative number indicates that the bank is losing money, which is using capital
(9) Loan Allowance / Total Loans
• Reserves for loan losses as a % of loans
• The higher the number the more the bank has to cover losses without using earnings
Earnings
(10) Return on Assets (ROA) = Net Income / Assets
• A measure of profitability indicating how well the bank has utilized its asset base
• A positive number means a bank is profitable and contributing to capital
(11) Return on Equity(ROE) = Net Income / Equity
• A measure of profitability indicating how well the bank has utilized its capital base
• ROE will always be a larger number, either positive or negative
(12) Net Interest Margin (NIM) = Interest income – Interest Expense / Earning Assets
• The bank’s profit from lending and investing activities after deducting fund cost of interest
bearing liabilities
• The largest source of revenue for most traditional banks, providing the best indicator of a bank’s
ability to generate profits
• See below for drivers of the margin
Net Interest Margin Related Ratios (#13 to #16) –
(13) Interest Income / Earning Assets
• Yield on earning assets
• Significantly impacted by:
o Distribution of earning assets (loans vs. securities, types of loans, etc.)
o Rates charged on various types of loans (risk vs. reward)
o Rates earned on various types of securities
7
(14) Interest Expense / Earning Assets
• A measure of funding cost
• Significantly impacted by:
o Composition of funding (non-interesting bearing liabilities vs. interest bearing, core
deposits vs. non-core funding, etc.)
o Rates paid on various types of deposits
o Cost of non-deposit funding
(15) Earning Assets / Assets
• Percentage of assets that are generating interest
• A high number means a bank has less non-earning assets and should have higher earnings
potential
• Banks with repossessed property from defaulted loans will have a lower ratio and most
likely, lower profitability
(16) Interest Bearing Funds / Assets
• Percentage of assets that are funded by liabilities that cost the bank interest
• A bank with a lot of capital will have a lower number and potentially a higher net interest
margin
(17) Overhead Expense / Assets
• Measure of the cost to operate, including salaries, premises and other expenses
• All businesses have to control overhead to be profitable
(18) Provisions / Assets
• Portion of earnings the bank is setting aside for future losses
• A high number may indicate a shortfall in the reserve account or reflect management’s view of
the potential for future losses
Liquidity
See ratios under Asset Composition
(19) Net Non-Core Fund Dependence
• The % of a bank’s long-term assets that are funded by other than core deposits (ex. FHLB, jumbo
CDs, etc.)
• Non-core liabilities – short-term investments / long-term assets
(20) Net Short-Term Non-Core Fund Dependence
• The % of bank’s long-term assets that are funded by short-term non-core funding.
• Short-term non-core funds – short-term investments / long-term assets
8
(21) Pledged Securities
• % of securities already committed to public funds or borrowings and therefore not available for
liquidity
(22) Loan Commitments
• Volume of commitments to fund future loans
• Generally, a bank will have more in commitments than will actually be funded
• A bank will need to ensure sufficient sources of funds to honor its commitments
Capital
(23) Tier One Leverage Capital
• Total equity capital (adjusted for intangibles) / Assets
• Measure of loss absorbing capital
• What the owners have at risk
(24) Tier One Risk Based Capital
• Total equity capital (adjusted for intangibles) / Risk-weighted assets
• The value of assets are adjusted by an assumed risk profile
• Generally, risk based capital will be higher than leverage capital since you are lowering the value
of less risky assets
(25) Total Risk Based Capital
• Total equity capital + subordinated debt + redeemable preferred stock + loan loss reserves /
Risk-weighted assets
• Similar to above but includes other capital instruments
(26) Cash dividends to net income
• % of income paid out and not available for capital growth
• May be an indication of shareholder obligations which may limit future capital growth
(27) Equity growth – asset growth
• If negative, capital growth is not keeping pace with asset growth leading to greater leverage
9
Bank Financial Analysis Flow of Components Asset Quality Key Factors Composition Loan types Securities Non‐earning assets Level of risk Peformance Importance This is how the bank makes money All assets are an investment or a bet Investment must be returned to bank to be successful Must manage this area well to be successful in all other areas Earnings Performance Importance In business to make money Allows business to grow Ensures financial stability Compensation for the risk the bank has assumed on assets Key Factors Level & quality Earning assets & yields Funding & costs Overhead Non‐interest income Loan loss provisions Liquidity Key Factors Cash flow Assets convertible to cash Funding sources Demands for cash Confidence Importance Cash Flow is heavily dependent on the performance of assets and their ability to generate revenue Poor performance of Asset Quality and Earnings Performance will lead to a lack of confidence, adversely impacting the ability to attract funding and creating pressure on existing funding Capital Key Factors Level Composition / quality Capital growth vs. asset growth Dividends Bank’s risk profile Regulatory minimums Importance Must support risk within bank Buffer to keep bank from failing Good performance in Asset Quality and Earnings Performance will generate more capital which is the cheapest way to increase 10
Management Key Factors Bank’s overall performance in the above areas Governance process & effectiveness Policies Management information systems Risk identification Importance Responsible for everything Covers all players in the organization ‐ tellers to board members 11
OBJECTIVES
 Identify key operating ratios used in
bank financial analysis
 Use ratios to make reasonable
assumptions regarding the bank’s
condition
 Understand relationships between
components
 Discover your institution
Strategy for Bank Analysis
What drives a bank’s
condition &
performance?
12
Strategy for Bank Analysis
Assets
Composition
Level of Risk
Performance
Strategy for Bank Analysis
Why do we make
these investments?
13
Asset / Liability Management
 Liquidity – Meeting needs of
depositors & commitments.




Balance sheet composition
Cash flow
Funding capacity
Confidence
Asset / Liability Management
 Sensitivity – How will the bank’s
earnings be impacted by changes in
interest rates?
 Structure
 Funding options
14
Capital’s Function
1. What the owners have at risk
2. Protects against unanticipated losses
Loss flow: reserves, earnings, capital
3. Ensures continuing operations during
losses
4. Source of funds
5. Controls growth
6. Protection: depositors, creditors,
communities
Strategy for Bank Analysis
Assets
Earnings
Liquidity
Sensitivity
Capital
15
Analysis Fundamentals
 Ratios are better than raw numbers
 Levels out changes from growth
 Provides support for conclusions
 Numerical relationship
- Numerator
- Denominator
 LEVEL and TREND
 WHY?
Asset Quality
16
OBJECTIVES
 Identify multiple ratios which may be
utilized to determine the quality and
performance of assets.
 Be familiar with the qualitative factors
affecting asset quality.
 Recognize the relationship/effect of
asset quality on earnings, liquidity &
capital.
Asset Quality
Major Risk Areas




Loans
Correspondent Accounts
Other Assets
Securities
17
Quantifiable Factors
Qualitative Factors
18
Assessing Asset Composition







Asset mix
Loan mix
Securities mix
Unfunded commitments
Trends in any of the above
Determine impact on the risk profile
Governance expectations
Assessing Asset Quality







Noncurrent loans
Nonaccrual assets
Loss Experience
Other assets
Internal reporting
Reserves
Qualitative factors
19
Earnings
Objectives
 Understand key factors in a bank’s
earnings performance.
 Understand past performance
 Effectuate change
 Be able to determine the quality of a
bank’s earnings.
20
4 Influences on NIM
Interest Income (Yields)
Interest Expense (Costs)
Level of Interest Earning Assets
Level of Interest Bearing Liabilities
Non Interest Income
 Service Charges on Deposit Accounts
 Trust Fees
 Secondary Mortgage Market Fees
 Lock Box
 Insurance Commissions
 Brokerage
May also have an expense implication!
21
Net Interest Margin Exercise
Evaluate each transaction’s impact on the key components of the net interest margin and
the overall margin. Starting information:
Average Earning Assets to Average Assets
Average Int. Bearing Funds to Average Assets
Interest Income to Average Earning Assets
Interest Expense to Average Earning Assets
Net Interest Margin
94.72
86.81
5.36
1.62
3.74
1. A bank sells a FHLB bond yielding 3.65% to fund a commercial loan yielding
8.50%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
2. A customer purchases a 95,000 certificate of deposit, yielding 2.95%. The funds
are invested in Fed Funds Sold at 1.50%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
Updated 8/6/06
22
23
3. Your bank sells 2,000,000 in FNMA bonds yielding 5.50%. The funds are used
for expansion of the main bank building.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
4. Your bank sells 2,000,000 in FNMA bonds yielding 5.15%. The funds are used
to repay FHLB borrowings costing 6.25%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
5. The bank makes a loan for 5,000,000 yielding 9.00%. The loan is funded by a
reducing fed funds sold by 2,000,000 yielding 2.5% and FHLB borrowings
costing 5.50%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
6. Your bank forecloses on a residential real estate mortgage yielding 6.50% and
takes possession of the house.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
Updated 8/6/06
24
7. **CHALLENGE QUESTION**
The bank receives a 5,000,000 payoff on a commercial loan, yielding 5.50%. The
proceeds are used to pay-off a 2,000,000 FHLB advance costing 6.00%; purchase
a 2,000,000 U.S. Treasury note yielding 3%; and increase fed funds sold by
1,000,000 yielding 0.75%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
Updated 8/6/06
25
Non-Interest Expense (Overhead)
 Salaries & Benefits
 Depreciation on Fixed Assets
 Operating Expenses
Allowance for Loans & Lease Losses
 “Provisions” = Adding to reserves
 A charge to current earnings.
 “Charge-offs” = Loan losses
 Reduces the reserve balance
 “Recoveries”
 Increases the reserve balance
26
Provision
Reserve
Net Loans
Balance
Sheet
Snapshot
Total Loans
Net Income
Capital
Less: Reserves
Equals: Net
Loans
Charge-off
Total Loans
Reserve
Adequately Funded Reserves
 Asset Composition
 Non-Performing Assets
 Adversely Classified Assets
 Loss History
 Loan Growth
The level of reserves need to track the
direction of credit risk.
27
Quality vs. Quantity
Are earnings generated through a series of
one-time events or the delay of expenses?
 Security gains
 Tax adjustments
 Pension adjustments
 Holding back on provision expenses
 Not fully accruing for expenses
 Capital adjustments vs. Expenses
 Keeping loans on accrual
Liquidity
28
Objectives
 Be able to identify and interpret
multiple indicators of liquidity.
 Understand the impact of asset
quality & earnings on liquidity.
Liquidity
Management of assets and liabilities to
meet both anticipated and
unanticipated funding demands.
Specifically, liquidity for a bank means
meeting the needs of depositors
wanting to withdraw funds and
borrowers having their credit needs
met.
29
Liquidity
Ability to obtain sufficient funds,
either by increasing liabilities or
by converting assets, promptly
and a reasonable cost.
Confidence Drives Liquidity
 Business model
 Diversification
 Assets
 Funding




Broader market
Management ability
FDIC Insurance
Press coverage: traditional & new
outlets
30
Questions to Evaluate Liquidity
1. What are the anticipated uses of funds in
coming period?
- Growth projections: loans, securities, etc.
2. What are management’s plans to fund
growth?
3. Are certain liabilities (funding) declining?
4. Do these liabilities need replacing?
5. What asset categories have increased?
6. How has this impacted your liquidity?
7. What funding options are available?
8. Have funding options been tested?
Liquidity Risk is Unique
 Buying Time to Manage Risk
 Credit Risk – reserves, restructure, legal
remedies
 Operational Risk – earnings, capital,
insurance
 Legal Risk – the judicial process
 Reputational Risk – PR, deeds, cash
 Liquidity:
A bank must get is right 100% of the
time.
31
Capital
Capital Adequacy
Capital must support the bank’s risk.
32
Determining Adequate Capital









Regulatory minimums
Asset quality
Off balance sheet activity
Earnings - quality & quantity
Balance sheet composition
Liquidity position
Growth experience, plans, & prospects
Management - experience, depth
Access to capital markets
Understanding
Risk Based
Capital
33
Understanding
Risk Based
Capital
Measures of Capital Adequacy






Classified assets / Capital & Reserves
Cash dividends / Net income
Growth history
Future growth
Retained earnings / Capital
Other Risk Considerations
 Liquidity
 Interest Rate Risk
 Management
34
Evaluating Management






Each and every component
Policies & Procedures
Management Information Systems
Appropriate roles / involvement
Competence
RESPONSIVENESS /
EFFECTIVENESS
35
Net Interest Margin Exercise
Evaluate each transaction’s impact on the key components of the net interest margin and
the overall margin. Starting information:
Average Earning Assets to Average Assets
Average Int. Bearing Funds to Average Assets
Interest Income to Average Earning Assets
Interest Expense to Average Earning Assets
Net Interest Margin
94.72
86.81
5.36
1.62
3.74
1. A bank sells a FHLB bond yielding 3.65% to fund a commercial loan yielding
8.50%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
2. A customer purchases a 95,000 certificate of deposit, yielding 2.95%. The funds
are invested in Fed Funds Sold at 1.50%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
Updated 8/6/06
36
37
3. Your bank sells 2,000,000 in FNMA bonds yielding 5.50%. The funds are used
for expansion of the main bank building.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
4. Your bank sells 2,000,000 in FNMA bonds yielding 5.15%. The funds are used
to repay FHLB borrowings costing 6.25%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
5. The bank makes a loan for 5,000,000 yielding 9.00%. The loan is funded by a
reducing fed funds sold by 2,000,000 yielding 2.5% and FHLB borrowings
costing 5.50%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
6. Your bank forecloses on a residential real estate mortgage yielding 6.50% and
takes possession of the house.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
Updated 8/6/06
38
7. **CHALLENGE QUESTION**
The bank receives a 5,000,000 payoff on a commercial loan, yielding 5.50%. The
proceeds are used to pay-off a 2,000,000 FHLB advance costing 6.00%; purchase
a 2,000,000 U.S. Treasury note yielding 3%; and increase fed funds sold by
1,000,000 yielding 0.75%.
Average Earning Assets to AA
Up
Down
No Change
Average Int. Bearing Funds to AA
Up
Down
No Change
Interest Income to AEA
Up
Down
No Change
Interest Expense to AEA
Up
Down
No Change
Net Interest Margin
Up
Down
No Change
Updated 8/6/06
39
KEY
1. A bank sells a FHLB bond yielding 3.65% to fund a commercial loan yielding 8.50%.
Average Earning Assets to AA
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Trading 1 earning asset for another.
Average Int. Bearing Funds to AA
No change to IBF or AA.
Interest Income to AEA
Loan has a higher yield than the bond.
Interest Expense to AEA
Did not change funding or the level of earning assets.
Net Interest Margin
Higher yield on earning assets and no change to the funding.
2. A customer purchases a 95,000 certificate of deposit, yielding 2.95%. The funds are
invested in Fed Funds Sold at 1.50%.
Average Earning Assets to AA
Up
Down
No Change
Down
No Change
Down
No Change
Down
No Change
Down
No Change
A 1 to 1 increase in the numerator and denominator, versus the average of 94.72%.
Average Int. Bearing Funds to AA
Up
100% of the new funding is interest bearing, versus the average of 86.81%
Interest Income to AEA
Up
New earning asset yields 1.50 versus the average yield of 5.36%.
Interest Expense to AEA
Up
New funding cost of 2.95% is higher than the average cost of funds of 1.62%
Net Interest Margin
Up
Lower asset yield and higher cost of funds.
3. Your bank sells 2,000,000 in FNMA bonds yielding 5.50%. The funds are used for
expansion of the main bank building.
Average Earning Assets to AA
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Trade an earning asset for a non-earning asset.
Average Int. Bearing Funds to AA
No change to funding or average assets.
Interest Income to AEA
Reducing both the numerator and the denominator, but giving up an earning asset at above average yield (5.50% vs. 5.36%).
Interest Expense to AEA
Up
Down
No Change
Down
No Change
No change to int expense but reducing the denominator (earning assets).
Net Interest Margin
Up
Reduction in earning assets; loss of earning asset higher than the average, increase cost of funds due to reduction in EA.
Updated 8/7/08
40
4. Your bank sells 2,000,000 in FNMA bonds yielding 5.15%. The funds are used to
repay FHLB borrowings costing 6.25%.
Average Earning Assets to AA
Up
Down
No Change
Down
No Change
Down
No Change
Down
No Change
Down
No Change
Reducing both EA and assets by the same amount (1 to 1 vs. 94.72%)
Average Int. Bearing Funds to AA
Up
Reducing both IBF and assets by the same amount (1 to 1 vs. 86.81%)
Interest Income to AEA
Up
Reducing EA with an asset that yields less than the average (5.15% vs. 5.36%).
Interest Expense to AEA
Up
Reducing funding that costs more than the average (6.25% vs. 1.62%).
Net Interest Margin
Up
Cost of FHLB borrowings greater than the FNMA bond’s yiled.
5. The bank makes a loan for 5,000,000 yielding 9.00%. The loan is funded by a
reducing fed funds sold by 2,000,000 yielding 2.5% and FHLB borrowings costing
5.50%.
Average Earning Assets to AA
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Increased EA and assets by 3MM (1 to 1 vs. 94.72% average)
Average Int. Bearing Funds to AA
Increase IBF and assets by 3MM (1 to 1 vs. 86.81%)
Interest Income to AEA
Incr. yield on 2MM of EA and add 3MM @ higher than average yield of 5.36%.
Interest Expense to AEA
Add funding at higher than average cost (5.50% vs. 1.62%).
Net Interest Margin
Improved asset yield offsets higher cost of funds.
6. Your bank forecloses on a residential real estate mortgage yielding 6.50% and take
possession of the house.
Average Earning Assets to AA
Up
Down
No Change
Up
Down
No Change
Up
Down
No Change
Swap EA for a non-earning assets.
Average Int. Bearing Funds to AA
No change to numerator or denominator.
Interest Income to AEA
Reduce both numerator and denominator. Yield on lost asset (6.50%) higher than the average of 5.36%.
Interest Expense to AEA
Up
Down
No Change
Up
Down
No Change
Numerator stays the same, but EA declines.
Net Interest Margin
7. The bank receives a 5,000,000 payoff on a commercial loan, yielding 5.50%. The
proceeds are used to pay-off a 2,000,000 FHLB advance costing 6.00%; purchase a
2,000,000 U.S. Treasury note yielding 3%; and increase fed funds sold by 1,000,000
yielding 0.75%.
Average Earning Assets to AA
Up
Down
No Change
Down
No Change
Up
Down
No Change
Up
Down
No Change
Down
No Change
Net loss to EA is 2MM, loss to assets is 2MM (1 to 1 vs. 94.72%).
Average Int. Bearing Funds to AA
Up
Net loss to IBF is 2MM, loss to assets is 2MM (1 to 1 vs. 86.81%)
Interest Income to AEA
Replaced portion of loan with lower yielding assets.
Interest Expense to AEA
The FHLB advances cost more (6.00%) than the average of 1.62%).
Net Interest Margin
Up
Updated 8/7/08
41
BANK OF GSBC
Summary Ratios--Page 1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
Earnings and Profitability
Percent of Average Assets:
Interest Income (TE)
- Interest Expense
Net Interest Income (TE)
+ Noninterest Income
- Noninterest Expense
- Provision: Loan & Lease Losses
Pretax Operating Income (TE)
+ Realized Gains/Losses Sec
Pretax Net Operating Income (TE)
Net Operating Income
Adjusted Net Operating Income
Net Inc Attrib to Min Ints
Net Income Adjusted Sub S
Net Income
Margin Analysis:
Avg Earning Assets to Avg Assets
Avg Int-Bearing Funds to Avg Assets
Int Inc (TE) to Avg Earn Assets
Int Expense to Avg Earn Assets
Net Int Inc-TE to Avg Earn Assets
BANK
12/31/2012
PG 3
PCT
12/31/2011
BANK
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
4.26
0.46
3.80
0.11
2.87
0.28
0.77
0.29
1.06
0.65
0.48
0.00
0.65
0.65
4.50
0.90
3.60
0.71
2.93
0.52
0.91
0.05
0.97
0.70
0.69
0.00
0.62
0.70
32
11
65
9
47
40
37
95
46
40
33
98
42
40
4.87
0.51
4.35
-0.34
3.04
1.09
-0.12
0.45
0.33
0.27
0.35
0.00
0.27
0.27
5.26
0.77
4.49
-0.31
2.99
1.21
-0.01
0.33
0.32
0.28
0.76
0.00
0.28
0.28
5.86
1.41
4.45
-0.42
2.97
0.59
0.48
0.10
0.58
0.40
0.44
N/A
0.40
0.40
6.79
2.17
4.61
0.17
2.94
0.14
1.70
0.00
1.70
1.07
1.11
N/A
1.07
1.07
92.72
85.49
4.60
0.50
4.10
93.16
79.78
4.84
0.96
3.87
40
77
32
11
64
94.77
84.87
5.14
0.54
4.59
93.98
83.00
5.60
0.82
4.78
93.20
83.52
6.29
1.51
4.78
95.65
83.99
7.09
2.27
4.82
Case Study Page 1
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4
5
6
7
8
9
10
11
12
13
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18
19
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21
22
23
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25
26
27
28
29
30
31
32
33
Summary Ratios - Page 1
Loan & Lease Analysis:
Net Loss to Average Total LN&LS
Earnings Coverage of Net Losses (X)
LN&SL Allowance to LN&LS Not HFS
LN&LS Allowance to Net Losses (X)
LN&LS Allowance to Total LN&LS
Total LN&LS-90+ Days Past Due
-Nonaccrual
-Total
BANK
0.76
2.11
1.90
2.42
1.90
0.00
0.22
0.22
12/31/2012
PG 3
0.80
7.54
1.92
4.83
1.89
0.08
2.64
2.78
PCT
59
35
57
40
59
38
7
5
12/31/2011
BANK
1.51
0.89
2.10
1.34
2.10
0.16
1.48
1.64
Liquidity
Net Non Core Fund Dep New $250M
Net Loans & Leases to Assets
34.42
54.89
5.81
62.81
97
26
33.27
63.49
29.13
71.61
24.85
69.40
11.13
68.51
Capitalization
Tier One Leverage Capital
Cash Dividends to Net Income
Retained Earnings to Avg Total Equity
Rest+Nonac+RE Acq to Eqcap+ALLL
9.36
0.00
6.77
8.62
9.42
28.29
2.98
31.01
51
37
73
21
9.61
0.00
2.84
34.66
9.63
0.00
2.90
43.51
9.78
22.11
3.12
29.63
9.69
0.00
11.38
17.17
10.29
7.95
-4.64
105.82
-3.35
4.11
6.00
-0.55
36.82
-48.63
79
64
33
80
90
3.43
2.22
-8.31
137.71
26.63
1.19
1.55
4.42
4.98
62.45
1.87
3.22
3.19
-87.54
38.26
10.94
15.75
11.89
223.70
-23.36
390,102
39,374
2,553
368,171
35,927
997
356,024
34,945
1,010
338,552
34,265
1,357
324,628
33,079
3,476
1,170
1,166
1,198
1,191
1,171
Growth Rates
Total Assets
Tier One Capital
Net Loans & Leases
Short Term Investments
Short Term Non Core Funding
Average Total Assets
Total Equity Capital
Net Income
Number of banks in Peer Group
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
1.00
0.78
0.14
1.54
1.83
17.74
1.82
1.23
1.20
1.83
1.66
8.90
1.82
1.23
1.20
0.00
0.00
0.00
2.48
1.36
2.57
2.48
1.36
2.57
Case Study Page 2
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
Income Statement $--Page 2
Interest and Fees on Loans
Income From Lease Financing
Tax-Exempt
Estimated Tax Benefit
Income on Loans & Leases (TE)
12/31/2012
13,179
0
0
0
13,179
12/31/2011
14,692
0
0
0
14,692
US Treas & Agency (Excl MBS)
Mortgage Backed Securities
Estimated Tax Benefit
All Other Securities
Tax-Exempt Securities Income
Investment Interest Income (TE)
0
1,899
315
1,163
658
3,377
3
1,899
233
1,038
466
3,173
4
2,099
249
731
505
3,083
33
2,905
235
725
497
3,898
252
2,760
222
607
492
3,841
Interest on Due From Banks
Int on Fed Funds Sold & Resales
Trading Account Income
Other Interest Income
26
0
0
42
11
0
0
42
9
0
0
25
5
58
0
109
13
283
0
109
16,624
17,918
18,729
19,843
22,028
N/A
708
1,078
0
10
0
N/A
799
1,024
0
64
0
N/A
910
1,740
0
83
0
N/A
880
3,648
1
242
0
N/A
1,609
5,105
46
292
0
1,796
1,887
2,733
4,771
7,052
14,828
444
15,272
16,031
-1,241
14,790
15,996
-1,114
14,882
15,072
-1,416
13,656
14,976
546
15,522
Total Interest Income (TE)
Int on Deposits in Foreign Off
Interest on Time Dep Over $100M
Interest on All Other Deposits
Int on Fed Funds Purch & Repos
Int Trad Liab & Oth Borrowings
Int on Sub Notes & Debentures
Total Interest Expense
Net Interest Income (TE)
Non-interest Income
Adjusted Operating Income (TE)
12/31/2010 12/31/2009 12/31/2008
15,612
15,773
17,782
0
0
0
0
0
0
0
0
0
15,612
15,773
17,782
Case Study Page 3
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
Income Statement $--Page 2
Non-Interest Expense
Provision: Loan & Lease Losses
Pretax Operating Income (TE)
12/31/2012
11,185
1,095
2,992
12/31/2011
11,209
4,030
-448
Realized G/L Hld-to-Maturity Sec
Realized G/L Avail-for Sale Sec
Pretax Net Operating Inc (TE)
0
1,124
4,116
0
1,649
1,200
0
1,190
1,143
0
334
1,946
0
-12
5,511
Applicable Income Taxes
Current Tax Equiv Adjustment
Other Tax Equiv Adjustments
Applicable Income Taxes (TE)
1,248
315
0
1,563
-30
233
0
203
-116
249
0
133
354
235
0
589
1,813
222
0
2,035
2,553
997
1,010
1,357
3,476
Net Extraordinary Items
Net Inc Noncontrolling Minority Interests
Net Income
0
0
2,553
0
0
997
0
0
1,010
0
N/A
1,357
0
N/A
3,476
Cash Dividends Declared
Retained Earnings
0
2,553
0
997
0
1,010
300
1,057
0
3,476
Net Operating Income
12/31/2010 12/31/2009 12/31/2008
10,629
10,062
9,536
4,300
1,982
463
-46
1,612
5,523
Case Study Page 4
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Nonint Income, Expenses and Yields--Page 3
Percent of Average Assets
Personnel Expense
Occupancy Expense
Other Oper Exp (Incl Intangibles)
Total Overhead Expense
Overhead Less Nonint Inc
Other Income & Expense Ratios:
Efficiency Ratio
Avg Personnel Exp Per Empl($000)
Assets Per Employee ($Million)
Yield on or Cost of:
Total Loan & Leases (TE)
Loans in Domestic Offices
Real Estate
Secured by 1-4 Fam Resi Prop
All Other Loans Sec Real Estate
Commercial & Industrial
Individual
Credit Card
Agricultural
Total Investment Securities (TE)
Total Investment Securities (Book)
US Treas & Agency (Excl MBS)
Mortgage Backed Securities
All Other Securities
Interest-Bearing Bank Balances
Federal Funds Sold & Resales
BANK
1.61
0.37
0.89
2.87
2.75
12/31/2012
PG 3
1.5
0.37
1.04
2.93
2.18
PCT
62
51
37
47
82
12/31/2011
BANK
1.51
0.41
1.12
3.04
3.38
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
1.45
1.54
1.70
0.43
0.44
0.36
1.11
1.00
0.88
2.99
2.97
2.94
3.30
3.39
2.77
73.24
99.76
6.46
67.83
65.25
4.62
69
93
84
75.78
91.07
6.05
71.42
83.34
5.75
73.68
81.22
5.51
61.43
82.30
5.16
5.62
5.62
5.83
5.18
5.86
4.37
5.92
N/A
N/A
2.84
2.57
N/A
2.22
3.49
0.44
N/A
5.84
5.82
5.76
5.76
5.78
5.93
7.5
9.71
6.02
3.19
2.87
2.11
3.1
3.65
0.33
0.18
34
36
56
25
56
4
19
N/A
N/A
36
34
N/A
15
38
76
N/A
5.93
5.93
6.17
5.26
6.2
4.46
5.99
N/A
N/A
3.49
3.24
1.33
2.95
3.94
0.13
0
6.00
6.00
6.18
5.11
6.20
4.74
5.99
N/A
N/A
4.62
4.25
4.19
4.26
4.22
0.17
0.00
6.68
6.68
6.82
1.27
7.11
5.77
6.37
N/A
N/A
5.27
4.95
3.41
5.26
4.07
2.21
1.91
7.89
7.89
7.82
N/A
N/A
8.24
7.81
N/A
N/A
4.97
4.68
3.53
5.12
3.74
4.83
5.01
Case Study Page 5
Nonint Income, Expenses and Yields--Page 3
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
Total Interest Bearing Deposits
Transaction accounts
Other Savings Deposits
Time Deps Over $100M
All Other Time Deposits
Foreign Office Deposits
Federal Funds Purchased & Repos
Other Borrowed Money
Subord Notes & Debentures
All Interest-Bearing Funds
Non-interest Income & Expenses
Fiduciary Activities
Deposit Service Charges
Trading, Vent Cap, Securtz Inc
Inv Banking, Advisory Inc
Insurance Comm & Fees
Net Servicing Fees
Loan & Lse Net Gains/Loss
Other Net Gains/Losses
Other Non-interest Income
Non-interest Income
Personnel Expense
Occupancy Expense
Goodwill Impairment
Other Intangible Amortiz
Other Oper Exp(incl Intangibles)
Non-Interest Expense
Domestic Banking Offices(#)
Foreign Branches (#)
Assets Per Domestic Office
BANK
0.55
0.53
0.38
0.74
0.89
N/A
0
0.17
N/A
0.54
12/31/2012
PG 3
1.03
0.41
0.50
1.57
1.63
0.23
0.61
2.68
4.96
1.13
12/31/2012
0
287
0
0
0
0
0
-544
701
444
6,285
1,424
0
0
3,476
11,185
4
0
101,716
PCT
9
69
38
2
5
N/A
15
8
N/A
7
12/31/2011
BANK
0.61
0.50
0.44
0.85
1.11
N/A
0.00
0.45
N/A
0.60
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
0.92
1.65
2.53
0.66
0.97
1.37
0.73
1.40
2.16
1.18
2.75
3.82
1.70
2.43
4.97
N/A
N/A
N/A
0.00
1.38
5.31
1.10
2.81
4.54
N/A
N/A
N/A
0.92
1.69
2.59
12/31/2011
0
364
0
0
2
0
0
-1,972
365
-1,241
5,555
1,521
0
0
4,133
11,209
4
0
92,225
12/31/2010 12/31/2009 12/31/2008
0
0
0
440
397
251
0
0
0
2
15
41
4
5
1
0
0
0
0
0
0
-1,909
-2,183
0
349
350
253
-1,114
-1,416
546
5,167
5,198
5,514
1,514
1,474
1,181
0
0
0
0
0
0
3,948
3,390
2,841
10,629
10,062
9,536
4
4
4
0
0
0
89,170
88,120
86,505
Case Study Page 6
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
Balance Sheet $--Page 4
Assets:
Real Estate Loans
Commercial Loans
Individual Loans
Agricultural Loans
Other LN&LS in Domestic Offices
LN&LS in Foreign Offices
Loans Held for Sale
Loans not Held for Sale
LN&LS Allowance
Net Loans & Leases
U.S. Treasury & Agency Securities
Municipal Securities
Foreign Debt Securities
All Other Securities
Interest-Bearing Bank Balances
Federal Funds Sold & Resales
Trading Account Assets
Total Investments
Total Earning Assets
Nonint Cash & Due From Banks
Premises, Fix Assts, Cap Leases
Other Real Estate Owned
Dir & Indir Inv RE Ventures
Inv in Unconsolidated Subs
Acceptances & Oth Assets
Total Assets
Average Assets During Quarter
12/31/2012
12/31/2011
12/31/2010 12/31/2009 12/31/2008
189,745
34,814
2,176
0
932
N/A
0
227,667
4,331
223,336
101,584
46,907
0
0
6,189
0
0
154,680
378,016
196,864
38,754
2,122
0
1,487
N/A
0
239,227
5,024
234,203
75,052
27,455
0
0
3,007
0
0
105,514
339,717
212,426
41,250
2,466
0
4,029
N/A
0
260,171
4,742
255,429
45,417
22,761
0
744
864
0
0
69,786
325,215
192,672
48,173
2,506
0
4,315
N/A
0
247,666
3,038
244,628
58,079
15,141
0
1,059
78
225
0
74,582
319,210
187,035
47,550
2,846
0
2,568
N/A
0
239,950
2,891
237,059
59,111
18,976
0
4,217
350
5,565
0
88,219
325,278
4,342
404
3,260
0
0
20,844
406,866
408,153
3,567
647
4,596
0
0
20,376
368,903
368,646
7,079
876
5,316
0
0
18,194
356,680
359,697
11,168
1,229
7,682
0
0
13,194
352,483
348,087
7,192
1,381
0
0
0
12,171
346,022
340,359
Case Study Page 7
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
Balance Sheet $--Page 4
Liabilities:
Demand Deposits
All Now & ATS Accounts
Money Market Deposit Accounts
Other savings Deposits
Time Deps At Or Below Insurance Limit
Less: Fully Insured Brokered Deposits
Core Deposits
Fully Insured Brokered Deposits
Time Deps Above Insurance Limit
Deposits in Foreign Offices
Total Deposits
Federal Funds Purch & Resale
Fed Home Loan Bor Mat < 1 Year
Fed Home Loan Bor Mat > 1 Year
Oth Borrowing Mat < 1 Year
Oth Borrowing Mat > 1 Year
Acceptances & Other Liabilities
Total Liabilities (Incl Mortg)
Subordinated Notes & Debentures
Total Bank Capital & Min Int
Total Liabilities & Capital
Memoranda:
Officers, Shareholder Loans (#)
Officers, Shareholder Loans ($)
Held-to-Maturity Securities
Available-for-Sale Securities
All Brokered Deposits
12/31/2012
12/31/2011
12/31/2010 12/31/2009 12/31/2008
17,241
6,332
97,196
92,089
110,584
95,077
228,365
95,077
20,230
0
343,672
0
20,000
0
0
0
3,820
367,492
0
39,374
406,866
17,770
4,775
93,343
74,012
104,935
81,838
212,997
81,838
15,707
0
310,542
0
19,000
0
0
0
3,434
332,976
0
35,927
368,903
16,124
3,383
99,816
92,832
17,442
7,808
221,789
7,808
81,787
0
311,383
0
7,594
0
0
0
2,758
321,735
0
34,945
356,680
28,169
4,153
124,701
69,165
33,226
25,476
233,938
25,476
49,561
0
308,975
0
5,000
2,094
0
0
2,149
318,218
0
34,265
352,483
22,344
3,261
148,511
84,714
10,789
4,295
265,324
4,295
38,413
0
308,032
0
0
2,094
0
0
2,817
312,943
0
33,079
346,022
2
9,192
1,733
146,758
95,077
2
8,168
1,973
100,534
81,838
2
8,945
2,210
66,712
64,111
4
10,274
2,445
71,834
46,367
5
12,567
0
82,304
4,295
Case Study Page 8
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Off Balance Sheet Items--Page 5
Outstanding (% of Total)
Home Equity (1-4 Family)
Credit Card
Commercial RE Secured by RE
1-4 Family Residential
Comml RE, Oth Const & Land
Commercial RE Not Secured by RE
All Other
Total LN&LS Commitments
Securities Underwriting
BANK
0.01
0.00
1.62
0.00
1.62
2.25
7.47
11.35
0.00
12/31/2012
PG 3
1.53
0.17
1.53
0.34
1.03
0.00
5.47
9.48
0.00
PCT
13
69
60
15
73
99
72
66
99
12/31/2011
BANK
0.01
0.00
1.54
0.00
1.54
1.52
8.67
11.74
0.00
Standby Letters of Credit
Amount Conveyed to Others
Commercial Letters of Credit
0.68
N/A
0.00
0.35
0.00
0.01
79
N/A
85
0.73
N/A
0.00
0.73
N/A
0.00
1.05
0.00
0.00
1.24
0.00
0.00
Assets Securitized or Sold w/Rec
Amount of Recourse Exposure
0.00
0.00
0.23
0.02
81
82
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
Credit Derivatives Bank as Guarantor
Credit Derivatives Bank as Beneficiary
0.00
0.00
0.00
0.01
99
99
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
All Oth Off-Balance Sheet Items
0.00
0.09
86
0.00
0.00
0.00
0.00
12.03
11.10
60
12.47
17.75
25.27
27.15
Off-Balance Sheet Items
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
0.02
0.00
0.00
0.00
0.00
0.00
2.21
5.51
8.07
0.00
0.03
0.44
2.21
5.48
7.63
3.70
5.44
2.31
11.11
13.27
15.52
17.03
24.22
25.91
0.00
0.00
0.00
Case Study Page 9
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Off Balance Sheet Items--Page 5
Outstanding ($000)
Home Equity (1-4 Family)
Credit Card
Commercial RE Secured by RE
1-4 Family Residential
Commercial RE, Oth Const & Land
Commercial RE Not Secured by RE
All Other
Securities Underwriting
Memo: Unused Commit w/mat GT 1 YR
12/31/2012
12/31/2011
40
0
6,608
0
N/A
9,148
30,375
0
25,195
49
0
5,691
0
N/A
5,592
31,979
0
20,264
56
0
7,867
0
N/A
13,188
39,622
0
24,757
0
0
19,415
98
N/A
19,186
46,767
0
30,070
0
0
27,941
1,533
N/A
8,009
53,690
0
35,682
2,758
N/A
0
2,688
N/A
0
2,594
N/A
0
3,715
0
0
4,300
0
0
Assets Securitized or Sold w/recourse
Amount of Recourse Exposure
0
0
0
0
0
0
0
0
0
0
Credit Derivatives Bank as Guarantor
Credit Derivatives Bank as Beneficiary
0
0
0
0
0
0
0
0
0
0
All Oth Off-Balance Sheet Items
0
0
0
0
0
48,929
45,999
63,327
89,083
93,940
Standby Letters of Credit
Amount Conveyed to Others
Commercial Letters of Credit
Off-Balance Sheet Items
12/31/2010 12/31/2009 12/31/2008
Case Study Page 10
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Balance Sheet % Composition--Page 6
Percent of Average Assets
Loans Held For Sale
Loans Not Held For Sale
Less: LN&LS Allowance
Net Loans & Leases
BANK
0
60.37
1.22
59.15
12/31/2012
PG 3
0.19
64.47
1.22
63.82
PCT
43
33
57
32
12/31/2011
BANK
0
68.43
1.32
67.11
Interest-Bearing Bank Balances
Federal Funds Sold & Resales
Trading Account Assets
Held-to-Maturity Securities
Available-for-Sale Securities
2.43
0.00
0.00
0.46
30.62
5.13
0.68
0.01
0.71
18.88
33
39
97
73
80
0.56
0
0
0.56
23.6
1.25
0.03
0
0.63
18.25
0.08
1.58
0
0.57
21.29
0.12
1.21
0
0
23.67
92.66
91.72
61
91.82
91.56
91.8
93.87
Nonint Cash & Due From Banks
Premises, Fix Assts & Cap Leases
Other Real Estate Owned
Dir & Indir Inv RE Ventures
Inv in Unconsolidated Subs
Acceptances & Other Assets
Total Non-Earning Assets
Total Assets
0.98
0.14
0.95
0.00
0.00
5.27
7.34
100
1.82
1.78
0.82
0.01
0.00
3.31
8.28
100
15
2
64
95
86
86
38
99
1.25
0.21
1.54
0.00
0.00
5.17
8.18
100
2.36
0.29
1.65
0.00
0.00
4.14
8.44
100
2.45
0.4
1.6
0.00
0.00
3.74
8.2
100
2.65
0.36
0
0.00
0.00
3.12
6.13
100
Standby Letters of Credit
0.74
0.37
81
0.72
1
1.17
1.56
Total Earning Assets
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
0
0
0
72.48
69.15
69.73
1.08
0.88
0.85
71.4
68.27
68.88
Case Study Page 11
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Balance Sheet % Composition--Page 6
Liabilities
Demand Deposits
All NOW & ATS Accounts
Money Market Deposit Accounts
Other Savings Deposits
Time Deps At or Below Insurance Limit
Less: Fully Insured Brokered Deposits
Core Deposits
Fully Insured Brokered Deposits
Time Deps Above Insurance Limit
Deposits in Foreign Offices
Total Deposits
BANK
4.47
1.06
24.61
22.77
27.74
22.89
57.76
22.89
4.90
0.00
85.56
12/31/2012
PG 3
7.94
5.64
17.73
14.19
29.04
2.43
75.37
2.43
4.80
0.10
83.9
PCT
29
9
71
70
44
98
6
98
59
98
57
12/31/2011
BANK
5.74
1.20
26.13
22.14
22.46
16.75
60.92
16.75
7.83
0.00
85.50
Federal Funds Purch & Repos
Total Fed Home Loan Borrowings
Total Other Borrowings
Memo: Sht Ter N Core Funding
0
3.86
0
26.55
1.27
3.04
0.03
9.57
38
63
67
97
0
4.12
0
30.23
0
1.88
0
24.85
0
1.52
0
14.97
0.31
1.8
0
15.29
0.89
90.3
0.63
89.95
78
52
0.72
90.34
0.7
90.22
0.68
90.11
0.68
90.6
0.00
9.70
100.00
0.05
10.00
100.00
95
48
97
0.00
9.66
100
0.00
9.78
100
0.00
9.89
100
0.00
9.40
100
22.89
22.89
2.64
2.43
97
98
19.86
20.30
16.60
3.72
5.59
4.37
1.06
1.06
0
0.3
43
0
0
0
0
Acceptances & Other Liabilities
Total Liabilities (Incl Mortg)
Subordinated Notes & Debentures
Total Bank Capital & Min Int
Total Liabilities & Capital
Memo: All Brokered Deposits
Insured Brokered Deposits
Loans HFS as a % Loans
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
6.59
6.88
7.71
1.18
1.16
1.25
30.63
38.76
40.83
22.23
23.84
22.13
6.15
6.34
3.11
3.72
4.37
1.06
63.06
72.60
73.96
3.72
4.37
1.06
20.87
10.94
12.78
0.00
0.00
0.00
87.65
87.91
87.81
Case Study Page 12
BANK
0.28
12.14
12/31/2012
PG 3
0.52
12.59
PCT
40
60
12/31/2011
BANK
1.09
19.59
Net Loss to Average Total LN&LS
Gross Loss to Average Total LN&LS
Recoveries to Average Total LN&LS
0.76
0.99
0.22
0.80
0.91
0.09
59
64
86
1.51
1.75
0.24
1.00
1.15
0.15
0.78
0.81
0.03
0.14
0.14
0.00
LN&LS Allowance to LN&LS Not HFS
LN&LS Allowance to Total LN&LS
LN&LS Allowance to Net Losses (X)
LN&LS Allowance to Nonaccrual LN&LS (X)
1.90
1.90
2.42
8.53
1.92
1.89
4.83
1.33
57
59
40
95
2.1
2.1
1.34
1.42
1.82
1.82
1.83
0.74
1.23
1.23
1.66
0.90
1.2
1.2
8.9
0.47
13 Earnings Coverage of Net Losses (X)
2.11
7.54
35
0.89
1.54
1.83
17.74
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Net Losses by Type of LN&LS
Real Estate Loans
Loans to Finance Comml Real Estate
Construction & Land Development
1-4 Family Construction
Other Construction & Land
Secured by Farmland
Single & Multifamily Mortgage
Home Equity Loans
1-4 Family Non-Revolving
Multifamily Loans
Non-Farm Non-Residential Mtg
Owner Occupied Nonfarm Nonresidential
Other Nonfarm Nonresidential
RE Loans in Foreign Offices
0.37
0
0
0
0
N/A
0
0
0
0
0.45
0
0.54
N/A
0.73
0.04
1.98
1.34
1.91
0.05
0.6
0.44
0.63
0.31
0.46
0.36
0.48
0
45
92
36
63
43
N/A
13
49
15
75
61
40
70
N/A
0.32
0.01
0.73
7.62
0
N/A
0
0
0
0
0.31
1.7
0
N/A
0.46
0
2.12
21.67
0
N/A
0
0
0
0
-0.19
0
-0.24
N/A
0.94
0
2.16
1.49
2.33
N/A
0
0
0
0
0.41
0.78
0.29
N/A
0
0
0
0
0
N/A
0
N/A
0
0
0
0
0
N/A
29
30
31
32
33
Agricultural Loans
Commercial and Industrial Loans
Loans to Individuals
Credit Card Plans
All Other Loans & Leases
N/A
2.82
0
N/A
-1.28
0.02
0.97
0.7
2
0.19
N/A
86
19
N/A
1
N/A
3.23
0
N/A
1631.67
N/A
3.41
0
N/A
20.78
N/A
0.20
0
N/A
0
N/A
0.72
0
N/A
0
1
2
3
4
5
6
7
8
9
10
11
12
Analysis of Credit Allow and Loan Mix--Pg 7
Analysis Ratios
Loss Provision to Average Assets
Recoveries to Prior Credit Loss
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
1.21
0.59
0.14
20.42
23.08
N/A
Case Study Page 13
1
2
3
4
5
6
7
8
9
10
11
12
Analysis of Credit Allow and Loan Mix--Pg 7
Change: Credit Allowance ($000)
Beginning Balance
Gross Credit Losses
Memo: Loans HFS Write-down
Recoveries
Net Credit Losses
Provision: Loan & Lease Losses
Other Adjustments
LN&LS Allowance
Average Total Loans & Leases
12/31/2012
12/31/2011
12/31/2010 12/31/2009 12/31/2008
5,024
2,314
0
526
1,788
4,742
4,333
0
585
3,748
3,038
2,986
0
390
2,596
2,891
1,910
0
75
1,835
2,753
325
0
0
325
1,095
0
4,331
4,030
0
5,024
4,300
0
4,742
1,982
0
3,038
463
0
2,891
234,454
247,699
260,286
236,104
225,326
Case Study Page 14
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
Analysis of Credit Allow & Loan Mix--Pg 7A
Loan Mix, % Average Gross LN&LS
Construction & Development
1-4 Family Construction
Other Const & Land Development
1-4 Family Residential
Home Equity Loans
Other Real Estate Loans
Farmland
Multifamily
Non-Farm Non-Residential
Owner Occupied Non-Farm Non-Residential
Other Non-Farm Non-Residential
Total Real Estate
BANK
3.34
0.57
2.77
3.03
0.23
76.33
0.00
7.08
69.26
11.94
57.32
82.71
12/31/2012
PG 3
7.95
1.52
6.08
24.39
3.43
41.97
3.39
2.94
33.71
16.87
16.16
77.02
PCT
22
26
29
2
16
97
16
89
97
26
99
62
12/31/2011
BANK
8.88
0.85
8.03
2.99
0.26
70.96
0.00
6.97
64.00
11.83
52.17
82.83
Financial Institution Loans
Agricultural Loans
Commercial & Industrial Loans
Loans to Individuals
Credit Card Loans
Municipal Loans
All Other Loans
0.00
0.00
15.90
0.88
0.00
0.00
0.51
0.00
2.00
13.38
3.51
0.07
0.59
0.28
92
33
66
21
69
38
78
0.00
0.00
15.41
0.96
0.00
0.00
0.80
0.00
0.00
16.72
1.07
0.00
0.00
1.65
0.00
0.00
19.65
1.05
0.00
0.00
1.47
0.00
0.04
20.36
1.40
0.00
0.00
0.52
Memorandum (% of Avg Tot Loans):
Loans & Lease Commitments
Officer, Shareholder Loans
Officer, Shareholder Loans to Assets
20.37
4.06
2.26
15.34
1.60
1.00
75
85
82
18.13
3.42
2.21
23.02
3.39
2.51
35.20
4.24
2.91
38.12
5.34
3.63
0.93
0
0
0
0.02
0.95
0.35
0
0.14
0.01
0.23
0.88
82
81
14
74
25
63
1.39
0
0
0
0.16
1.54
1.02
0
0.15
0
0.48
1.65
0.78
0
0.5
0
0.33
1.6
0
0
0
0
0
0
Other Real Estate Owned % Assets
Construction & Land Development
Farmland
1-4 Family
Multifamily
Non-Farm Non-Residential
Total
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
22.21
25.09
24.66
2.17
5.04
8.02
20.04
20.05
17.24
1.22
0.48
1.19
0.35
0.15
0.00
57.14
52.26
51.83
0.00
0.00
0.00
6.80
6.15
3.38
50.34
46.11
48.46
11.73
11.28
12.45
38.62
34.83
37.26
80.57
77.83
77.68
Case Study Page 15
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
Analysis of Concentrations of Credit--Pg 7B
Loan & Leases as a % of Total Capital
Construction & Development
1-4 Family Construction
Other Const & Land Development
1-4 Family Residential
Home Equity Loans
Other Real Estate Loans
Farmland
Multifamily
Non-Farm Non-Residential
Owner Occupied Non-Farm Non-Residential
Other Non-Farm Non-Residential
Total Real Estate
BANK
11.10
0.68
10.42
15.14
1.28
429.67
0.00
43.28
386.39
68.31
318.07
455.90
12/31/2012
PG 3
47.13
9.03
36.03
159.63
22.55
270.40
21.01
19.89
217.51
108.41
105.58
485.95
PCT
14
12
21
2
16
88
18
85
90
26
97
44
12/31/2011
BANK
26.99
4.22
22.77
19.32
1.39
460.22
0.00
42.41
417.80
69.56
348.24
506.53
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
86.49
165.44
162.44
8.36
17.61
51.82
78.13
147.83
110.62
16.65
2.44
6.91
2.33
2.44
0.00
451.48
349.25
349.48
0.00
0.00
0.00
45.43
40.13
39.38
406.05
309.12
310.09
80.01
79.44
73.87
326.04
229.68
236.22
554.62
517.13
518.82
Financial Institution Loans
Agricultural Loans
Commercial & Industrial Loans
Loans to Individuals
Credit Card Loans
Municipal Loans
All Other Loans
0
0
83.65
5.23
0
0
2.24
0
11.86
85.98
20.53
0.41
3.45
1.71
94
34
54
20
70
40
75
0
0
99.71
5.46
0
0
3.83
0
0
107.70
6.44
0
0
10.52
0
0
129.3
6.73
0
0
11.58
0
0
131.90
7.89
0
0
7.12
Supplemental:
Loans to Finance Commercial Real Estate
29.38
0.73
98
40.07
34.93
45.16
32.90
CRE Loans as a % of Total Capital:
Non-owner OCC Commercial Real Estate
Total Commercial Real Estate
401.83
470.15
181.37
293.01
93
87
457.72
527.28
492.88
572.9
480.42
559.85
470.94
544.81
CRE Loans as a % of Total LN&LS:
Construction & Development
Non-owner OCC Commercial Real Estate
Total Commercial Real Estate
2.03
73.46
85.95
7.33
28.35
46.33
13
98
98
4.39
74.36
85.66
12.73
72.56
84.34
24.89
72.27
84.22
24.40
70.75
81.85
Case Study Page 16
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Analysis of Past Due, Nonaccrl & Restr--Pg 8
% of Non-Current LN&LS by Loan Type
Real Estate LNS-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
BANK
0
0.27
0.27
0.91
12/31/2012
PG 3
0.08
2.96
3.1
1
PCT
54
10
8
56
12/31/2011
BANK
0
0.93
0.93
1.36
LNS Fin Coml RE-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
0
0
0
0
0
0.84
0.84
0.51
99
95
95
96
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Const & Land Dev-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
0
0
0
0
0.02
7.8
8.02
0.67
87
27
25
50
0
12.6
12.6
0
0
12.19
12.19
0
0
4.63
4.63
4.37
0
10.25
10.25
0
1-4 Fam Cons & L Dev-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
0
0
0
0
0.22
4.23
4.45
0.25
96
63
62
81
0
80.61
80.61
0
0
90.03
90.03
0
0
0
0
0
0
32.12
32.12
0
Other Const & Land Dev-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
0
0
0
0
0.01
8.08
8.31
0.66
90
32
30
56
0
0
0
0
0
3.86
3.86
0
0
5.18
5.18
4.89
0
0
0
0
0
2.09
2.09
0
0.09
1.93
2.09
1.12
61
62
60
9
0
2.12
2.12
7.06
0
2.62
2.62
0
0
0
0
0
0
0
0
0
Single & Multi Mtg-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
0
0
0
2.63
1.48
3.21
2.63
1.48
3.21
0
1.40
0
Case Study Page 17
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
Analysis of Past Due, Nonaccrl & Restr--Pg 8
Non-Farm Res Mtg-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
Own Occ Non-Farm Non-Res-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
Other Non-Farm Non-Res-90+ Days P/D
-Nonaccrual
-Total
-30-89 DAYS P/D
0
0
0
1.08
12/31/2012
0.04
2.33
2.44
0.70
80
13
11
72
12/31/2011
0
0
0
0.60
12/31/2010 12/31/2009 12/31/2008
0
0
0
0.59
0
0
0.59
0
0
0
0
0
0
0
0
0
0.03
2.00
2.10
0.71
85
24
22
36
0
0
0
0
0
2.99
2.99
0
0
0
0
0
0
0
0
0
0
0
0
1.31
0.01
2.34
2.45
0.49
90
33
31
81
0
0
0
0.72
0
0
0
0
0
0
0
0
0
0
0
0
12/31/2012
0
508
508
1,735
12/31/2011
394
3,529
3,923
2,668
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Restructured LN&LS 90+ Days P/D
Restructured LN&LS Nonaccrual
Restructured LN&LS 30-89 Days P/D
0
508
0
394
1,829
0
0
0
0
0
0
0
0
0
0
Current 1-4 Family Restru LN&LS
Current Other Restructured LN&LS
Loans Secured 1-4 RE in Foreclosure
Other Real Estate Owned
0
0
0
3,260
0
5,674
0
4,596
0
5,510
0
5,316
0
0
0
7,682
N/A
0
N/A
0
Non-Current LN&LS ($000)
90 Days and Over Past Due
Total Nonaccrual LN&LS
Total Non-Current LN&LS
LN&LS 30-89 Days Past Due
Gtyd LN&LS 90+ Days P/D
Gtyd LN&LS on Nonaccrual
Gtyd LN&LS 30-89 Days P/D
12/31/2010 12/31/2009 12/31/2008
0
0
0
6,440
3,370
6,175
6,440
3,370
6,175
1,037
2,694
11
Case Study Page 18
Analysis of PD, Nonaccrual & Restr--Pg 8A
1 % of Non-Current LN&LS by Loan Type
2 Coml & Indust LNS-90+ Days P/D
3 -Nonaccrual
4 -Total
5 -30-89 DAYS P/D
6 Loans to Individuals-90+ Days P/D
7 -Nonaccrual
8 -Total
9 -30-89 DAYS P/D
10 Agricultural LNS-90+ Days P/D
11 -Nonaccrual
12 -Total
13 -30-89 DAYS P/D
14 Other LN&LS-90+ Days P/D
15 -Nonaccrual
16 -Total
17 -30-89 DAYS P/D
18
19
20
21
22
23
24
25
26
27
28
29
30
31
Total LN&LS-90+ Days Past Due
-Nonaccrual
-Total
-30-89 DAYS P/D
Other Pertinent Ratios:
Non-Cur LN&LS to-LN&LS Allowance
-Equity Capital
% Total P/D LN&LS-Incl Nonaccrual
Non Curr LNS+OREO to LNS+OREO
Non-Curr Restruct Debt/Gr LN&LS
Curr+Non-Curr Restruct/GR LN&LS
Current Restruct LN&LS
Lns Sec 1-4 RE in Forcl as % Total Lns 1-4 Fam
BANK
0
0
0
0
12/31/2012
PG 3
0.03
1.58
1.68
0.63
PCT
74
17
14
18
12/31/2011
BANK
1.02
4.38
5.40
0
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
0
0
0
2.09
1.08
0.37
2.09
1.08
0.37
1.06
0
0
0
0
0
0
0.05
0.32
0.44
1.03
67
41
31
17
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0.39
N/A
N/A
N/A
N/A
0.02
0.06
0.08
0.05
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0
0
0
0
0
0.1
0.14
0.11
91
78
73
64
0
0
0
0
0
0
0
14.89
0
0
0
0
0
0
0
0
0
0.22
0.22
0.76
0.08
2.64
2.78
0.97
38
7
5
50
0.16
1.48
1.64
1.12
0
2.48
2.48
0.40
0
1.36
1.36
1.09
0
2.57
2.57
0
11.73
1.29
0.99
1.63
0.22
0.22
0
0
139.92
18.39
3.84
4.21
0.56
1.52
1.04
0.4
4
6
13
27
52
26
21
44
78.09
10.92
2.76
3.49
0.93
3.3
2.37
0
135.81
18.43
2.87
4.43
0
2.12
2.12
0
110.93
9.84
2.45
4.33
0
0
0
0
213.59
18.67
2.58
2.57
0
0
0
N/A
Case Study Page 19
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
Liquidity & Investment Portfolio--Page 10
Percent of Total Assets
Short Term Investments
Marketable Equity Sec (MES)
Core Deposits
Short Term Non Core Funding
BANK
1.52
0
56.13
28.85
12/31/2012
PG 3
7.44
0.02
76.18
7.64
PCT
13
73
4
98
12/31/2011
BANK
0.82
0
57.74
32.93
Liquidity Ratios
Net Non Core Fund Dep Orig $100M
Net Non Core Fund Dep New $250M
Brokered Deposits to Deposits
Broker Dep Mat < 1 Yr to Broker Deps
Short Term Inv to S.T. Ncore Fund
Short Term Asset to S.T. Liabilities
Net S.T. Liabilities to Assets
Net Loans & Leases to Deposits
Net LN&LS to Core Deposits
Net LN&LS & SBLC to Assets
36.26
34.42
27.67
81.44
5.27
33.27
19.84
64.99
97.80
55.57
17.48
5.81
2.73
59.31
139.73
108.12
0.24
75.11
83.29
63.29
89
97
97
52
3
5
91
24
77
26
37.77
33.27
26.35
89.51
2.48
38.03
21.63
75.42
109.96
64.22
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
0.35
0.34
2.79
0
0
0
62.18
66.37
76.68
26.89
16.75
12.34
29.13
29.13
20.59
100
1.32
65.77
10.09
82.03
115.17
72.34
24.85
24.85
15.01
100
2.04
146.92
-8.82
79.17
104.57
70.46
11.13
11.13
1.39
100
22.64
195.35
-13.54
76.96
89.35
69.75
Case Study Page 20
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
Liquidity & Investment Portfolio--Page 10
Securities Mix
Held-to-Maturity % Total Secs
US Treas & Govt Agencies
Municipal Securities
Pass-Through Mtg Backed Secs
CMO & REMIC Mtg Backed Secs
Commercial Mtg Back Secs
Asset Backed Securities
Structured Financial Products
Other Domestic Debt Secs
Foreign Debt Securities
Total Held-to-Maturity
Available-for-Sale % Total Secs
US Treas & Govt Agencies
Municipal Securities
Pass-Through Mtg Backed Secs
CMO & REMIC Mtg Backed Secs
Commercial Mtg Back Secs
Asset Backed Securities
Structured Financial Products
Other Domestic Debt Secs
Foreign Debt Securities
Inv Mut Fnd & Oth Mktbl
Total Available-for-Sale
Other Securities Ratios:
App (Dep) Hi Risk & Struc/T1 Cap
App (Dep) in HTM Sec to HTM Sec
App (Dep) in HTM Sec to Eqy Cap
Pledged Securities to Tot Sec
BANK
12/31/2012
PG 3
PCT
12/31/2011
BANK
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
0
1.17
0
0
0
0
0
0
0
1.17
0.09
1.52
0.13
0.01
0.02
0.04
0.04
0.26
0.04
4.04
91
79
85
92
99
99
99
95
98
70
0
1.92
0
0
0
0
0
0
0
1.92
0
3.21
0
0
0
0
0
0
0
3.21
0
3.29
0
0
N/A
0
N/A
0
0
3.29
0
0
0
0
N/A
0
N/A
0
0
0
0
30.42
19.83
48.58
0
0
0
0
0
0
98.83
22.83
17.9
21.98
12.19
0.06
0.19
0.01
1.08
0.14
0.13
88.05
16
70
49
91
88
96
91
67
97
73
29
0
24.86
13.87
59.35
0
0
0
0
0
0
98.08
0
29.82
8.33
58.65
0
0
0
0
0
0
96.79
0.14
17.09
10.66
68.81
N/A
0
N/A
0
0
0
96.71
3.77
23.06
3.05
70.13
N/A
0
N/A
0
0
0
100
0
0
0
18.06
0.02
2.64
0.18
44.84
63
25
72
17
0
0
0
27.22
0
0
0
82.87
0
0
0
14.77
0
N/A
0
18.64
Case Study Page 21
Liquidity & Investment Portfolio--Page 10
1
2
3
4
5
6
7
8
9
10
11
12
13
Short Term Investments
Short Term Assets
Short Term Non Core Funding
Non Core Liabilities Orig $100M
Non Core Liabilities New $250M
Fed Home Loan Bor Mat < 1 Year
Fed Home Loan Bor Mat > 1 Year
Other Borrowing Mat < 1 Year
Other Borrowing Mat > 1 Year
Debt Securities 90+ Days P/D
Total Non-Current Debt Sec
Fair Value Structured Notes
12/31/2012
BANK
6,189
40,252
117,398
142,180
135,307
20,000
0
0
0
12/31/2011
BANK
3,007
48,960
121,469
131,903
116,545
19,000
0
0
0
0
0
0
0
0
0
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
1,265
1,205
9,669
69,168
97,326
95,957
95,922
59,046
42,708
97,189
82,131
44,802
97,189
82,131
44,802
7,594
5,000
0
0
2,094
2,094
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Case Study Page 22
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
Capital Analysis--Page 11
Capital Ratios
Percent of Bank Equity:
Net Loans & Leases (x)
Subord Notes & Debentures
Long Term Debt
Com RE & Related Ventures
Percent of Average Bank Equity:
Net Income
Dividends
Retained Earnings
Other Capital Ratios:
Dividends to Net Operating Income
Bank Eq Cap + Min Int to Assets
Growth Rates:
Total Equity Capital
Equity Growth Less Asst Growth
Intang Assets % Bank Equity
Mortgage Servicing Rights
Goodwill
Purch Credit Card Relations
All Other Intangibles
Total Intangibles
Risk-Based Capital
Tier One RBC to Risk-Wgt Assets
Total RBC to Risk-Weight Assets
Tier One Leverage Capital
Other Capital Ratio:
Def Tax Asset to T1 Cap
BANK
12/31/2012
PG 3
PCT
12/31/2011
BANK
12/31/2010 12/31/2009 12/31/2008
BANK
BANK
BANK
5.67
0
0
459.50
6.36
0.62
0.62
284.64
38
95
95
85
6.52
0
0
537.31
7.31
0
0
593.33
7.14
0
0
587.54
7.17
0
0
550.82
6.77
0
6.77
6.52
2.87
2.98
43
35
73
2.84
0
2.84
2.90
0.00
2.90
4.01
0.89
3.12
11.38
0
11.38
0
9.68
33.76
10.17
25
43
0
9.74
0
9.8
22.11
9.72
0
9.56
9.59
-0.70
8.87
4.06
57
28
2.81
-0.62
1.98
0.79
3.59
1.72
17.98
7.04
0
0
0
0
0
0.17
2.21
0.04
0.32
3.27
78
61
96
64
39
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
13.83
15.09
9.36
13.94
15.2
9.42
54
55
51
12.64
13.9
9.61
11.67
12.92
9.63
11.62
12.71
9.78
11.62
12.7
9.69
7.59
1.61
93
9.99
8.87
6.11
3.19
Case Study Page 23
Capital Analysis--Page 11
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
12/31/2012
12/31/2011
0
20,172
237
18,373
592
0
39,374
0
39,374
0
20,172
113
15,819
-177
0
35,927
0
35,927
0
20,172
97
14,822
-146
0
34,945
0
34,945
0
20,172
69
13,812
212
0
34,265
0
34,265
0
20,172
65
12,755
87
0
33,079
0
33,079
Subordinated Notes & Debentures
0
0
0
0
0
Changes in Bank Equity ($000)
Balance at Beginning of Period
+ Net Income
+ Sales or Purchase of Capital
+ Merger & Absorptions
+ Restate due to Acctg Error&Chg
+ Trans with Parent
- Dividends
+ Other Comprehensive Income
Balance at End of Period
35,927
2,553
124
0
0
0
0
769
39,373
34,945
997
16
0
0
0
0
-31
35,927
34,265
1,010
28
0
0
0
0
-358
34,945
33,079
1,357
4
0
0
0
300
125
34,265
28,039
3,476
1,014
0
0
0
0
550
33,079
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
End of Period Capital ($000)
Perpetual Preferred
+ Common Stock
+ Surplus
+ Undivided Profits
+ Accum Other Comp Income
+ Other Equity Capital Comp
Total Bank Equity Capital
Minority Interest Cons Subs
Total Bank Capital & Min Int
Intangible Assets
Mortgage Servicing Rights
+ Purch Credit Card Relations.
+ Other Intangibles
+ Goodwill
Total Intangibles
12/31/2010 12/31/2009 12/31/2008
Case Study Page 24
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Capital Analysis--Page 11A
Risk Based Capital ($000)
Tier One Capital
Total Equity Capital Adjusted
- Ineligible Def Tax Assets
- Ineligible Intangibles
- Cumul Change F.V. Financial Liab
Net Tier One
Tier Two Capital
+ Qualif Debt and Redeem Pfd
+ Cumulative Preferred Stock
+ Allowable LN&LS Loss Allow
+ Unrl Gain Mktbl Eqy Sec (45%)
+ Other Tier 2 Capital Comp
Net Eligible Tier Two
Total RBC Before Deductions
Tier One & Tier Two
Tier Three & Fin Sub Adj
- Deductions for Total RBC
Total Risk-Based-Capital
12/31/2012
12/31/2011
12/31/2010 12/31/2009 12/31/2008
38,782
623
0
0
38,159
36,104
754
0
0
35,350
35,091
510
0
0
34,581
34,053
0
0
0
34,053
32,992
0
0
0
32,992
0
0
3,461
0
0
3,461
0
0
3,515
0
0
3,515
0
0
3,720
0
0
3,720
0
0
3,205
0
0
3,205
0
0
3,058
0
0
3,058
41,620
0
0
41,620
38,865
0
0
38,865
38,301
0
0
38,301
37,258
0
0
37,258
36,050
0
0
36,050
Case Study Page 25
Capital Analysis--Page 11A
1 Risk-Weighted Assets
2 On-Balance Sheet
3 Category Two - 20%
4 Category Three - 50%
5 Category Four - 100%
6
Total On-Balance Sheet
7 Memo: Category One - 0%
8 Off-Balance Sheet
9 Category Two - 20%
10 Category Three - 50%
11 Category Four - 100%
12
Total Off-Balance Sheet
13 Memo: Category One - 0%
14 Adjustments to Risk-Wgt Assets
15 Risk-Weighted Asset Before Ded
16 - Excess Allowable LN&LS Loss Al
17 - Allocated Transfer Risk Reserve
18 + Mkt Risk Asset & Fin Sub Adj
19
Total Risk-Weighted Assets
12/31/2012
12/31/2011
12/31/2010 12/31/2009 12/31/2008
23,224
15,504
223,981
262,709
38,439
14,701
18,040
236,973
269,714
26,919
13,859
14,059
256,032
283,950
7,716
13,988
10,183
251,975
276,147
12,868
17,426
11,573
234,924
263,923
3,561
1
173
13,977
14,151
0
0
0
11,476
11,476
0
0
0
13,676
13,676
0
0
0
16,893
16,893
0
0
0
19,991
19,991
0
276,861
969
0
0
275,892
281,190
1,608
0
0
279,583
297,626
1,188
0
0
296,439
293,040
0
0
0
293,041
283,914
0
0
0
283,914
Case Study Page 26