Horizon Bancorp is reporting a net income in the second quarter of 2011 of
$3.1 million or 83 cents per diluted share, compared to $2.5 million or 65
cents in the year-ago period, an increase of 23 percent.
Net income for the first half of 2011 was $5.9 million or $1.57 per diluted
share, compared to $4.3 million or $1.09 in the year-ago period, “the
highest first six months of net income in the company’s history,” Horizon
said in a statement released on Wednesday.
“Our continuing ability to generate record earnings reflects our commitment
to balanced revenue streams and the tremendous dedication and quality of
Horizon’s employees,” said Horizon President and CEO Craig Dwight. “We have
acquired new customers and expanded banking relationships with existing
clients by providing exceptional service at competitive pricing. We
continued to win market share.”
“While a slowdown in residential mortgage lending and refinancing led to
lower income from mortgage warehousing, other areas of our diversified and
balanced business mix more than offset the decline,” Dwight added. “This is
our strategy which is working as designed.”
“The operating efficiencies implemented in the past several years have made
us more productive and profitable,” Dwight also said. “Economic recovery is
slow, with businesses and consumers remaining cautious and conservative. We
have focused on pursuing every quality opportunity available to build and
expand banking relationships.”
“An encouraging sign for Horizon and the economy is a measurable reduction
of non-accrual loans and a decline in loans that are 30 to 89 days
delinquent, which represent the highest risk for requiring additional loan
loss reserves or restructuring,” Dwight said.
•Total deposits surpassed $1 billion on June 30 and increased by $34.8
million since Dec. 31, 2010.
•Borrowings decreased by $30.6 million since Dec. 31.
•Net interest income, after provisions from loan losses, was $19.7 million
for the first half of 2011, compared to $15.7 million for the year-ago
•Non-performing loans decreased by 6.7 percent in the second quarter of 2011
compared to the year-ago period.
•The provision for loan losses decreased to $2.9 million for the first half
of 2011, compared to $6.2 million for the year-ago period.
•The company’s mortgage servicing asset recovered $728,000 of impairment
during the first half of 2011 as mortgage loan refinancing activity slowed.
•Horizon’s tangible book value per share rose to $28.76, compared to $25.39
at June 20, 2010.
•The company’s capital ratios “continued to be well above the regulatory
standards for well-capitalized banks.”
Total loans decreased during the first half of 2011 by $48.7 million, as a
result of decreased financing activity, Horizon said, while residential
mortgage loan activity generated $1.3 million of income in the second
quarter, down $366,00 from the year-ago period but up $755,000 compared to
the first quarter of 2011.
Non-performing loans total $20.6 million on June 30, 2011, down from $22.1
million on March 31, 2011, and from $21.2 million on June 30, 2010. As a
percentage of total loans, non-performing loans were 2.44 percent on June
30, 2010, down from 2.71 percent on March 31, 2011, but up from 2.6 percent
on June 30, 2010. “The increase from a year ago was due to a decrease in
total loans,” Horizon said.
“We have confidence in our credit analysis and risk management
capabilities,” Dwight said. “We believe the decrease in total non-performing
loans indicates a slowing of financial problems caused by the sluggish
economy, challenging employment conditions, and a housing market that
continues to struggle with an overload of inventory.”
“We continue to reserve for potential loan losses but we believe the outlook
is significantly more encouraging than a year ago,” Dwight said. “Because
our non-performing assets represent a small percentage of our total loans,
and our capital position remains strong, we are able to seek out new quality
lending opportunities that other banks are not able to pursue because of
their financial or regulatory situation. We are not afraid to lend.”
Horizon Bancorp is a locally owned, independent commercial bank hold company
serving Northern Indiana and Southwest Michigan. It also offers
mortgage-banking services throughout the Midwest. Its common stock trades on
the NASDAQ Global Market under the symbol HBNC.