News Releases
- Peoples Bancorp Inc. Declares Fourth Quarter 2009 Dividend
- Peoples Bancorp Inc. Announces Third Quarter Results
- Peoples Bancorp Inc. To Add New Executive Vice President
- Peoples Bancorp Inc. Declares Third Quarter 2009 Dividend
- Peoples Bancorp Inc. Appoints New Directors
- Peoples Bancorp Inc. Announces Second Quarter Results
- Peoples Bancorp Inc. Declares Second Quarter 2009 Dividend
- Peoples Bank Opens Financial Services Office in Zanesville, Ohio
- Peoples Bancorp Inc. Announces First Quarter Results
- Peoples Bank to Consolidate Banking Offices
- David Wesel Named Executive Vice President, Investment and Insurance Services
- Peoples Bancorp Inc. Declares First Quarter 2009 Dividend
- Peoples Bancorp Inc. Receives $39 Million from U.S. Treasury Capital Purchase Program
- Peoples Bancorp Inc. Announces 2008 Results
- Peoples Bancorp Inc. Shareholders Authorize Issuance of Preferred Shares
PEOPLES BANCORP INC.
DECLARES FOURTH QUARTER 2009 DIVIDEND
__________________________________________
November 19, 2009
Contact: Mark Bradley
President and Chief Executive Officer
(740) 373-3155
MARIETTA, Ohio -The Board of Directors of Peoples Bancorp Inc. (NASDAQ: PEBO) today declared a cash dividend of $0.10 per common share payable January 4, 2010, to common shareholders of record on December 15, 2009.
The fourth quarter dividend represents a payout of approximately $1.1 million based on 10.5 million common shares currently outstanding and an annualized dividend yield of 3.88% based on the closing stock price of Peoples’ common shares of $10.30 on November 18, 2009.
Peoples’ capital continues to be significantly higher than regulatory minimums needed to be considered “well capitalized”. At September 30, 2009, Peoples’ Tier 1 Common, Total Tier 1 and Total Risk-Based Capital ratios were 10.30%, 15.06% and 16.39%, compared to the well capitalized minimum ratios of 4%, 6% and 10%, respectively.
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 47 locations and 39 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc., which includes the Putnam and Barengo divisions. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
END OF RELEASE
PEOPLES BANCORP INC.
ANNOUNCES THIRD QUARTER RESULTS
___________________________________________
October 20, 2009
Contact: Edward Sloane
Chief Financial Officer and Treasurer
(740) 373-3155
MARIETTA, Ohio - Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) today announced results for the quarter ended September 30, 2009. Higher provision for loan losses, coupled with other-than-temporary impairment (“OTTI”) charges on investment securities, resulted in Peoples incurring a net loss of $4.6 million, or $0.44 per diluted common share, for the third quarter of 2009. In comparison, Peoples reported net income available to common shareholders of $2.3 million, or $0.23 per diluted common share, for the second quarter of 2009 (or “linked quarter”) and $3.0 million, or $0.28 per diluted common share for the third quarter of 2008. On a year-to-date basis, net income available to common shareholders was $1.6 million through September 30, 2009, versus $10.6 million a year ago, while diluted earnings per common share were $0.16 and $1.02, respectively.
Summary points regarding third quarter 2009 results:
- Provision for loan losses totaled $10.2 million, or 0.93% of average loans, as net charge-offs were $7.1 million and the allowance for loan losses increased to 2.46% of total loans versus 2.12% at June 30, 2009. Nonperforming assets increased $2.5 million, or 6%, to 2.16% of total assets, from 2.00% at the prior quarter-end. These changes in asset quality reflect lower collateral value on existing commercial real estate loans, coupled with continued deterioration in financial condition of commercial borrowers.
- Peoples recognized a non-cash pre-tax OTTI charge of $5.9 million ($3.9 million or $0.37 per common share after-tax) for credit losses incurred on two available-for-sale investment securities involving bank-issued trust preferred securities.
- Total Risk-Based Capital ratio was 16.39% at quarter-end, substantially higher than the regulatory minimum amount needed to be considered “well-capitalized”, and tangible common equity increased to 7.22% of tangible assets, from 6.78% at June 30, 2009.
- Both net interest income and margin were consistent with the linked quarter, while year-over-year, net interest income grew 6% and net interest margin experienced slight compression.
- Non-interest income was down 6% from the linked quarter, due mostly to lower mortgage banking income from a slow-down in refinancing activity, and down 5% year-over-year, attributable to lower insurance revenues and reduced bank owned life insurance income.
- Non-interest expense benefited from significantly lower FDIC insurance expense and incentive-related compensation costs compared to the linked quarter. FDIC insurance expense decreased as a result of Peoples recognizing $930,000 of expense in the second quarter of 2009 related to the special assessment imposed on all FDIC insured banks.
“Our third quarter results were impacted by losses caused by continued weakness in commercial real estate values and the general economy,” said Mark F. Bradley, President and Chief Executive Officer. “These losses also overshadowed positive results in several key areas, including stable net interest margin and enhanced operating efficiency. We also preserved Peoples’ healthy capital position, which continues to serve as a source of strength as we work through a challenging economy.”
Bradley continued, “The build up of our allowance for loan losses during the third quarter reflects our continued proactive approach to identify and dispose of problem loans. While additional loans were placed on nonaccrual status, we were successful in resolving some existing nonaccrual loans. We are encouraged by this progress and remain committed to reducing the overall level of nonperforming assets.”
Third quarter 2009 net interest income of $15.5 million was comparable to the second quarter of 2009, while net interest margin was unchanged at 3.45%. Interest income was impacted by loan payoffs during the third quarter of 2009, coupled with the impact of additional loans being placed on nonaccrual status. However, the lower interest income was offset by a reduction in interest expense from the linked quarter, due to lower overall cost of funds attributable to Peoples repaying maturing, high-cost borrowings. Compared to the third quarter of 2008, net interest income increased 6%, as average earning assets increased $122 million, or 7%, year-over-year. A portion of the earning asset growth was the result of Peoples maintaining higher cash balances as a result of limited opportunities for attractive long-term asset investments and Peoples’ planned paydowns of high-cost wholesale funding. The higher cash balance also accounted for the 5 basis point reduction in third quarter 2009 net interest margin versus the same period last year.
“Both net interest income and margin remained stable, despite pressure from short-term interest rates remaining at low levels,” said Edward G. Sloane, Chief Financial Officer and Treasurer. “Earning asset yields continue to decline from downward repricing of variable rate loans and new loans being originated at current market rates. However, our ability to grow and retain low-cost core deposits has allowed us to continue repaying higher-cost funding as it matures, which produced a greater reduction in overall funding costs. We will continue to seek out opportunities to enhance net interest income and margin, while managing risks inherent in our balance sheet.”
Non-interest income totaled $7.8 million for the third quarter of 2009, down slightly compared to both the linked quarter and prior year third quarter. During the third quarter of 2009, mortgage loan refinancing activity slowed versus the linked quarter, resulting in decreased mortgage banking income from lower gains on sales of loans. However, secondary market loan production remained more robust than the prior year, resulting in year-over-year growth in mortgage banking income. Insurance income decreased in the third quarter of 2009, compared to both the linked quarter and prior year third quarter. This decrease was attributed to lower property and casualty insurance commissions. Through nine months of 2009, total non-interest income was consistent with the same period last year.
Non-interest expense decreased $1.4 million, or 9%, on a linked quarter basis, totaling $14.1 million for the third quarter of 2009. Much of this reduction was caused by decreased FDIC insurance expense and lower incentive-based compensation expense. Year-over-year growth in total non-interest expense occurred for both the three and nine months ended September 30, 2009, due mostly to the additional FDIC insurance expense and external legal and valuation expenses associated with problem loans. Other significant contributing factors included higher employee medical benefit and pension plan costs.
"Our efforts to control operating costs have been successful, although hampered by additional costs related to problem loans,” said Sloane. “The recessionary economy has limited our ability to grow certain non-interest revenues, including insurance commissions and trust and investment income. We continue to explore opportunities to expand our client base and maximize the use of existing resources as a means of maintaining operating efficiency and lowering costs when possible.”
In the third quarter of 2009, Peoples recorded $5.9 million of other-than-temporary impairment losses on investment securities, of which $4.0 million related to a single bank-issued trust preferred security deemed a total loss and $1.9 million related to a collateralized debt obligation (“CDO”) security, consisting mostly of bank-issued trust preferred securities, previously carried at $2.7 million. Management concluded these losses were required under current accounting rules since it did not expect to recover the entire amortized cost of the securities. These determinations were based upon management’s evaluation of the credit quality of the issuers during the third quarter and estimation of cash flows to be received from the securities. After the third quarter 2009 impairment charges, the carrying value of Peoples’ remaining investments in individual bank-issued trust preferred securities and CDO securities were $16.7 million and $2.8 million, respectively.
During the third quarter of 2009, Peoples’ loan balances decreased $26.1 million to $1.07 billion, due mostly to some commercial loan payoffs during the quarter, coupled with the impact of charge-downs on existing impaired commercial loans. Through nine months of 2009, total loan balances also were impacted by loans being refinanced and sold to the secondary market due to customer demand for long-term, fixed-rate residential real estate loans. As a result, Peoples’ serviced loan portfolio increased 22% since year-end 2008, to $220.6 million at September 30, 2009.
Nonperforming assets were $43.4 million, or 2.16% of total assets, at September 30, 2009, versus $40.9 million, or 2.00%, at June 30, 2009. During the third quarter of 2009, Peoples placed $10.6 million of commercial loans on nonaccrual status, of which the majority are secured by commercial real estate and the remainder secured by other business assets. The overall increase in nonperforming assets was mostly offset by charge-downs and payoffs on existing nonaccrual loans, which totaled $6.6 million and $2.4 million, respectively. Peoples’ nonperforming assets are comprised primarily of nonaccrual loans secured by commercial real estate.
Third quarter 2009 net loan charge-offs were $7.1 million, or 2.57% of average loans on an annualized basis, compared to $5.7 million, or 2.05%, and $2.1 million, or 0.74%, for the second quarter of 2009 and third quarter of 2008, respectively. Approximately $5 million of the third quarter 2009 charge-offs were attributable to existing impaired commercial real estate loans to four unrelated borrowers, with aggregate balances of $18 million, becoming under-collateralized during the quarter. Through nine months of 2009, net loan charge-offs were $15.6 million, or 1.90% of average loans on an annualized basis, versus $10.8 million, or 1.29%, for the same period in 2008.
Peoples’ allowance for loan losses increased $3.1 million in the third quarter of 2009, to $26.2 million, or 2.46% of total loans, from $23.2 million, or 2.12%, at June 30, 2009. This increase was caused by credit deterioration of several commercial loan relationships and increases in specific reserves for impaired commercial real estate loans during the third quarter, coupled with the impact of charge-offs remaining at an elevated level. To maintain the adequacy of the allowance for loan losses, Peoples recorded a third quarter 2009 provision for loan losses of $10.2 million versus $4.7 million last quarter and $6.0 million in the third quarter of 2008.
At September 30, 2009, retail deposit balances were down $29.6 million from the prior quarter-end but remained nearly $10 million higher than December 31, 2008. During the third quarter, Peoples continued its planned reduction in higher-cost, non-core deposits, primarily consisting of certificates of deposits from customers outside Peoples’ primary market area, given the growth in lower-cost and non-interest-bearing deposits. Money market balances increased 7% during the third quarter and 15% since year-end 2008, while savings account balances were up 14% at quarter-end compared to December 31, 2008.
At September 30, 2009, Peoples’ Tier 1 Common, Total Tier 1 and Total Risk-Based Capital ratios were 10.26%, 15.06% and 16.39%, compared to the well capitalized minimum ratios of 4%, 6% and 10%, respectively. Since year-end 2008, tangible common equity has increased due to improvement in fair value of Peoples’ available-for-sale investment portfolio. As a result, tangible common equity to tangible assets was 7.22% at September 30, 2009, versus 6.78% last quarter and 6.21% at year-end 2008, while tangible equity to tangible assets was 9.21%, 8.74% and 6.21%, respectively.
"Although third quarter results were well below our expectations, we believe our allowance for loan losses is adequate to absorb losses inherent in the loan portfolio and our strong capital position prepares us well for the future,” summarized Bradley. “Our core earnings stream is still strong, plus we are working on strategies to further enhance operating efficiency as we expect challenging economic times to persist.”
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 47 locations and 39 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank); and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly-traded companies. Learn more about Peoples at www.peoplesbancorp.com.
Conference Call to Discuss Earnings:
Peoples will conduct a facilitated conference call to discuss third quarter 2009 results of operations today at 11:00 a.m., Eastern Daylight Savings Time, with members of Peoples’ executive management participating. Analysts, media and individual investors are invited to participate in the conference call by calling (800) 860-2442. A simultaneous Webcast of the conference call audio will be available online via the “Investor Relations” section of Peoples’ website, www.peoplesbancorp.com. Participants are encouraged to call or sign in at least 15 minutes prior to the scheduled conference call time to ensure participation and, if required, to download and install the necessary software. A replay of the call will be available on Peoples’ website in the “Investor Relations” section for one year.
Safe Harbor Statement:
Certain statements made in this news release regarding Peoples’ financial condition, results of operations, plans, objectives, future performance and business, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by the fact they are not historical facts and include words such as “anticipate”, “may”, “feel”, “expect”, “believe”, “plan”, and similar expressions.
These forward-looking statements reflect management’s current expectations based on all information available and its knowledge of Peoples’ business and operations. Additionally, Peoples’ financial condition, results of operations, plans, objectives, future performance and business are subject to risks and uncertainties that may cause actual results to differ materially. These factors include, but are not limited to: (1) continued deterioration in the credit quality of Peoples’ loan portfolio could occur due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than otherwise assumed and assumed cash flows may be less favorable than expected, which may adversely impact the provision for loan losses; (2) competitive pressures among financial institutions or from non-financial institutions, which may increase significantly; (3) changes in the interest rate environment, which may adversely impact interest margins; (4) changes in prepayment speeds, loan originations, and charge-offs, which may be less favorable than expected and adversely impact the amount of interest income generated; (5) general economic conditions and weakening in the economy, specifically the real estate market, either national or in the states in which Peoples does business, which may be less favorable than expected; (6) political developments, wars or other hostilities, which may disrupt or increase volatility in securities markets or other economic conditions; (7) legislative or regulatory changes or actions, which may adversely affect the business of Peoples and its subsidiaries; (8) adverse changes in the conditions and trends in the financial markets, which may adversely affect the fair value of securities within Peoples’ investment portfolio; (9) a delayed or incomplete resolution of regulatory issues that could arise; (10) Peoples’ ability to receive dividends from its subsidiaries; (11) the impact of larger or similar financial institutions encountering problems, which may adversely affect the banking industry and/or Peoples; (12) changes in accounting standards, policies, estimates or procedures, which may impact Peoples’ reported financial condition or results of operations; (13) Peoples’ ability to maintain required capital levels and adequate sources of funding and liquidity; (14) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity; (15) the costs and effects of regulatory and legal developments, including the outcome of regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; and (16) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (“SEC”), including those risk factors included in the disclosures under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2008, as updated by the disclosure under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Quarterly Report on Form 10-Q for the quarter ended June 30, 2009.
Peoples encourages readers of this news release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements. Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.
Please click here to view the complete earnings release.
PEOPLES BANCORP INC.
TO ADD NEW EXECUTIVE VICE PRESIDENT
________________________________________
Daniel K. McGill named Executive Vice President, Chief Commercial Lending Officer
September 9, 2009
Contact: Mark F. Bradley
President and Chief Executive Officer
(740) 373-3155
MARIETTA, Ohio - Peoples Bancorp Inc. (NASDAQ: PEBO) announces the addition of an executive position to provide strategic leadership of the company’s commercial banking associates. Daniel K. McGill will begin September 14, 2009 as Executive Vice President, Chief Commercial Lending Officer for Peoples Bancorp Inc. and banking subsidiary Peoples Bank.
"We are pleased to welcome Dan to our executive leadership team,” said Mark F. Bradley, President and Chief Executive Officer of Peoples Bancorp Inc. and Peoples Bank. “Dan will lead our commercial lenders and small business banking associates in our client relationship-based sales and service strategies. The addition of Dan to our leadership group helps us continue the integration and growth of our product offerings across banking, insurance and investment services.”
McGill recently served for the past 10 years as a regional president for First Merit Bank, where he was responsible for managing and growing community banking offices in parts of Ohio and western Pennsylvania. He specifically managed sales and client service efforts across commercial banking and wealth management lines of business. McGill has over 20 years experience in the financial services industry.
Peoples Bancorp Inc. also announces that concurrent with McGill’s hiring, Executive Vice President Joseph S. Yazombek will assume the role of Executive Vice President, Chief Credit Officer for Peoples Bancorp Inc. and Peoples Bank. In this new role, Yazombek will work directly to ensure the overall quality of the company’s loan portfolio through adherence to policies, procedures, and underwriting standards. As Chief Credit Officer, Yazombek will also continue participation in several loan and risk committees related to corporate management.
"Because of our significant growth over the past decade, combined with increasing complexity regarding loan analysis and policies, we are separating the leadership roles for commercial loan production and credit risk management,” continued Bradley. “Joe can focus his attention on loan quality and risk management processes, while Dan concentrates on customer sales and service, revenue growth, and strategies that build relationships among current and prospective commercial clients.”
Yazombek has over 25 years experience in lending and has been Peoples Bancorp and Peoples Bank’s Chief Lending Officer since 2000, responsible for $440 million of loan growth and overseeing $1.1 billion in total loans at June 30, 2009.
McGill is a graduate of the University of Akron and earned his Masters in Business Administration through Case Western Reserve majoring in Finance. He is also active in civic and community leadership through various volunteer efforts.
"The addition of Dan to our executive management team better positions the company to implement commercial banking initiatives,” said Bradley. “It also strengthens our management team as we work through challenging economic times and plan for future success. Dan and Joe will be in positions where their strengths can be leveraged to better serve our clients and shareholders.”
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 47 locations and 39 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc., which includes the Putnam and Barengo divisions. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
END OF RELEASE
PEOPLES BANCORP INC.
DECLARES THIRD QUARTER 2009 DIVIDEND
___________________________________________
August 27, 2009
Contact: Mark F. Bradley
President and CEO
(740) 373-3155
MARIETTA, Ohio - The Board of Directors of Peoples Bancorp Inc. (NASDAQ: PEBO) today declared a cash dividend of $0.10 per common share payable October 1, 2009, to common shareholders of record on September 15, 2009. The third quarter dividend represents a reduction from the $0.23 per common share paid for the second quarter of 2009 and an annualized dividend yield of 2.38% based on the closing stock price of Peoples’ common shares of $16.82 on August 26, 2009.
"Our decision to reduce the dividend was difficult considering our long history of dividend growth, but it preserves capital and further strengthens our balance sheet as we manage through challenging economic times,” said Mark F. Bradley, President and Chief Executive Officer. “We believe it is prudent to maintain and build Peoples’ strong capital position to drive future earnings growth.”
The third quarter dividend payment approximates $1.1 million based on 10.5 million common shares currently outstanding.
"The lower dividend balances the need to maintain a dividend payout consistent with recent earnings levels and long-term capital needs, plus provide an appropriate return on shareholder investment” continued Bradley. “Future dividend payments will be determined each quarter based upon Peoples’ performance and be consistent with our long-term goal to be a strong competitor in the markets we serve.”
Peoples’ capital continues to be significantly higher than regulatory minimums needed to be considered “well-capitalized”. At June 30, 2009, Peoples’ Tier 1 Common, Total Tier 1 and Total Risk-Based Capital ratios were 10.24%, 14.85% and 16.19%, compared to the well- capitalized minimum ratios of 4%, 6% and 10%, respectively.
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 47 locations and 39 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc., which includes the Putnam and Barengo divisions. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
Safe Harbor Statement:
Certain statements made in this news release are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by the fact they are not historical facts and include words such as “anticipate”, “may”, “feel”, “expect”, “believe”, “plan”, and similar expressions.
These forward-looking statements reflect management’s current expectations based on all information available and its knowledge of Peoples’ business and operations. Additionally, Peoples’ financial condition, results of operations, plans, objectives, future performance and business are subject to risks and uncertainties that may cause actual results to differ materially. These factors include, but are not limited to: (1) continued deterioration in the credit quality of Peoples’ loan portfolio could occur due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than otherwise assumed and assumed cash flows may be less favorable than expected, which may adversely impact the provision for loan losses; (2) competitive pressures among financial institutions or from non-financial institutions, which may increase significantly; (3) changes in the interest rate environment, which may adversely impact interest margins; (4) changes in prepayment speeds, loan originations, and charge-offs, which may be less favorable than expected and adversely impact the amount of interest income generated; (5) general economic conditions and weakening in the economy, specifically the real estate market, either national or in the states in which Peoples does business, which may be less favorable than expected; (6) political developments, wars or other hostilities, which may disrupt or increase volatility in securities markets or other economic conditions; (7) legislative or regulatory changes or actions, which may adversely affect the business of Peoples and its subsidiaries; (8) adverse changes in the conditions and trends in the financial markets, which may adversely affect the fair value of securities within Peoples’ investment portfolio; (9) a delayed or incomplete resolution of regulatory issues that could arise; (10) Peoples’ ability to receive dividends from its subsidiaries; (11) the impact of larger or similar financial institutions encountering problems, which may adversely affect the banking industry and/or Peoples; (12) changes in accounting standards, policies, estimates or procedures, which may impact Peoples’ reported financial condition or results of operations; (13) Peoples’ ability to maintain required capital levels and adequate sources of funding and liquidity; (14) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity; (15) the costs and effects of regulatory and legal developments, including the outcome of regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; and (16) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (“SEC”), including those risk factors included in the disclosures under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
Peoples encourages readers of this news release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements. Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.
END OF RELEASE
PEOPLES BANCORP INC.
APPOINTS NEW DIRECTORS
___________________________________________
July 27, 2009
Contact: Mark F. Bradley
President and CEO
(740) 373-3155
MARIETTA, Ohio - Peoples Bancorp Inc. (Nasdaq: PEBO) announced the recent election of Dave M. Archer and Brenda F. Jones, M.D. as directors of the company. The Peoples Bancorp Board of Directors unanimously approved the appointments of Mr. Archer and Dr. Jones at the company’s July 23rd board meeting.
"Dave and Brenda are welcome additions to the Peoples Bancorp board of directors,” said Mark F. Bradley, President and CEO of Peoples Bancorp Inc. "Their extensive experience as Peoples Bank directors and diverse business backgrounds will be positive influences on our company.” The appointments increase the number of Peoples Bancorp directors to 14.
Since 1993, Archer has served as a director of Peoples Bank, the national bank subsidiary of Peoples Bancorp Inc. Dr. Jones has served as a director of Peoples Bank since 1994.
Archer is owner, President and CEO of several companies based in southeastern Ohio, including Pioneer Pipe, Inc. His companies represent one of the largest full-service construction and fabrication groups in the United States, specializing in general, mechanical, and electrical construction, as well as pipe and steel fabrication and installation. He also volunteers his time in many community service projects and charitable organizations. Archer and his family reside in the Marietta, Ohio area.
Since 1991, Dr. Jones has been Medical Director of Marietta Ophthalmology Associates, Inc. She is a graduate of Brown University and the medical school at the University of North Carolina in Chapel Hill. Dr. Jones is a member of the American Academy of Ophthalmology (Fellow), Ohio Ophthalmology Society, American Medical Association, National Medical Association and Research to Prevent Blindness. Dr. Jones and her family are residents of Marietta, Ohio.
Archer’s term as a director of Peoples Bancorp runs through the shareholders’ annual meeting date in 2010. Dr. Jones’ term will be through the shareholders’ annual meeting date in 2011.
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 47 locations and 39 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
End of Release
PEOPLES BANCORP INC. ANNOUNCES
SECOND QUARTER RESULTS
___________________________________________
July 21, 2009
Contact: Edward G. Sloane
Chief Financial Officer and Treasurer
(740) 373-3155
MARIETTA, Ohio - Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) today announced results for the quarter ended June 30, 2009. Net income available to common shareholders totaled $2.3 million, or $0.23 per diluted common share, compared to $2.0 million, or $0.19 per diluted common share, for the second quarter of 2008, and $3.9 million, or $0.37 per diluted common share, for the first quarter of 2009 (or “linked quarter”). On a year-to-date basis, net income available to common shareholders was $6.2 million through June 30, 2009 versus $7.6 million a year ago, while diluted earnings per common share were $0.60 and $0.73, respectively.
Highlights of second quarter 2009 results:
- Total revenue was comparable to the first quarter of 2009, despite a seasonal decline in insurance income, and increased 4% over the prior year second quarter, due to stronger net interest income and mortgage banking income.
- Non-interest expense growth was isolated to higher FDIC insurance expense, while other second quarter operating costs were contained. FDIC insurance expense increased $1.1 million on a linked quarter basis, of which $930,000 ($605,000 or $0.06 per diluted common share after-tax) related to the special assessment imposed on all FDIC insured banks.
- Nonperforming assets increased a modest 5%, or $2 million, compared to the prior quarter-end. Net charge-offs were higher than first quarter 2009 due to continued deterioration of commercial real estate loans. These changes in asset quality caused a $0.7 million, or 17%, increase in provision for loan losses on a linked quarter basis.
- Retail deposits increased $40 million, or 3%, from year-end 2008 balances due to growth in non-interest bearing and low-cost core deposits.
- Capital remained substantially higher than the regulatory minimum amount needed to be considered “well-capitalized” and tangible common equity to tangible assets improved to 6.78%.
- Quarterly dividend to common shareholders was maintained at $0.23 per share.
“Overall, we believe second quarter results were positive in many aspects, considering the significant increase in FDIC assessments, which lowered after-tax earnings by $0.06 per share,” said Mark F. Bradley, President and Chief Executive Officer. “While the recessionary economy continues to negatively impact charge-offs and provision for loan losses, second quarter earnings benefited from stable revenues and effective operating expense control. In addition, Peoples’ strong capital position continues to afford us greater flexibility in working through problem loans.”
Second quarter 2009 net interest income was comparable to the prior quarter, as lower interest income was mostly offset by reduced interest expense. Interest income continued to be impacted by higher levels of nonperforming loans, coupled with modest declines in loan yields from refinancing activity and downward repricing of variable rate loans. Second quarter interest expense benefited from opportunities to reduce overall funding costs, as matured deposits and long-term borrowings were repaid using short-term assets and growth in lower-cost retail deposits.
Peoples continued to maintain a higher volume of short-term assets in the second quarter compared to recent periods, due to limited opportunities for attractive long-term asset investments. These short-term assets, which consist of excess cash reserves held at the Federal Reserve Bank, caused some net interest margin compression on a linked quarter basis. Interest reversals for loans placed on nonaccrual status also contributed to lower second quarter net interest margin.
“Both net interest income and margin were in line with our expectations, given the current interest rate environment,” said Edward G. Sloane, Chief Financial Officer and Treasurer. “In the second half of 2009, we plan to continue paying down higher-rate wholesale funding as maturities occur and reduce the level of short-term assets. We expect these actions will help us to maintain net interest income, while net interest margin could expand slightly.”
Non-interest income remained strong in the second quarter of 2009, totaling $8.2 million. Deposit account service charges and property and casualty insurance sales commissions were both higher than the first quarter of 2009, while fiduciary revenues benefited from improvement in market values of managed assets. These increased revenues offset the seasonal decline in insurance income attributable to performance based insurance revenue, the majority of which is recognized annually in the first quarter, as well as a modest decrease in mortgage banking income. During the second quarter, long-term mortgage rates rose slightly causing residential mortgage refinancing activity to moderate. However, secondary market loan production remained more robust than the prior year. As a result of the increase in mortgage banking revenues, second quarter non-interest income was up 5% year-over-year. On a year-to-date basis, higher mortgage banking revenue and increased deposit account service charges were mostly offset by reductions in trust and investment revenues and bank owned life insurance income, resulting in a modest 2% increase in total non-interest income.
Second quarter 2009 non-interest expense was impacted by higher FDIC insurance expense, while other operating costs were consistent with first quarter 2009 levels. Year-over-year growth in total non-interest expense occurred for both the three and six months ended June 30, 2009, due mostly to the additional FDIC insurance expense. Other significant contributing factors included increased employee benefit costs and higher loan-related expenses, primarily external legal and valuation services associated with problem loans. The majority of the linked quarter increase in FDIC insurance expense was due to the impact of the special assessment imposed on all banks, with the remainder attributed to higher base assessment rates. Second quarter 2008 FDIC expense also was lower due to the utilization of a one-time credit received in 2007. Salary and employee benefit costs were up 9% in the second quarter of 2009 versus the same quarter last year, due almost entirely to higher employee medical benefit and incentive-related costs. Electronic banking expense decreased 27% from the prior quarter, largely attributable to a reduction in bankcard processing costs from Peoples receiving a one-time discount as part of changing its card network membership.
“In the second quarter of 2009, our diversified revenue stream remained strong and operating expenses were reasonable, considering the impact of the FDIC’s actions to restore the deposit insurance fund through higher assessments,” said Sloane. “The recent changes to our branch network, which included the consolidation of four banking offices into new or existing offices, should help control our operating costs. We continue to evaluate our delivery channels and growth opportunities as a means of improving operating efficiency without sacrificing client service levels.”
During the second quarter of 2009, Peoples’ loan balances decreased $6.7 million to $1.09 billion, due to continued demand for fixed-rate residential real estate loans, which are sold to the secondary market, and write-downs on impaired commercial loans. The sale of fixed-rate residential real estate loans to the secondary market was also a key driver of the $9.9 million reduction in total loan balance through six months of 2009. Sluggish economic conditions have slowed commercial lending activity, while consumer lending continues to experience steady growth, with consumer balances up $7.3 million, or 8.3%, since year-end 2008.
Nonperforming assets were $40.9 million, or 2.00% of total assets, at June 30, 2009, versus $38.8 million, or 1.89%, at March 31, 2009. During the second quarter, Peoples placed commercial real estate loans to four unrelated borrowers on nonaccrual status, with loan balances totaling $6.8 million at June 30, 2009. This increase in nonaccrual loans in the second quarter of 2009 was tempered by charge-downs and payments on other nonaccrual loans during the quarter. Despite the second quarter increase, nonperforming assets remained lower than the prior year-end total of $41.8 million, or 2.09% of total assets. Peoples’ nonperforming assets continue to be comprised primarily of nonaccrual loans secured by commercial real estate.
Second quarter 2009 net charge-offs were $5.7 million, compared to $2.9 million for the prior quarter. Approximately $3.4 million of second quarter charge-offs represented losses on four relationships provided for in prior quarters through the allowance for loan losses, while $2.0 million was the result of costs associated with the workout of three relationships, which further reduced the estimated net realizable value of the properties during the quarter. These losses were partially offset by a $1.0 million recovery on a single impaired commercial relationship. On a year-to-date basis, net charge-offs for the first six months of 2009 were comparable to the first half of 2008. Based on management’s quarterly estimation of losses inherent in the loan portfolio, the allowance for loan losses decreased $0.9 million, to $23.2 million, or 2.12% of total loans. To maintain the adequacy of the allowance for loan losses, Peoples recorded a provision for loan losses of $4.7 million in the second quarter of 2009, compared to $4.1 million in the first quarter of 2009.
“The increase in unemployment and depressed real estate values in certain markets continue to adversely affect asset quality,” commented Sloane. “However, the credit issues in our loan portfolio have remained mostly isolated to non-owner-occupied commercial properties and real estate development projects, which have been hit extremely hard in the economic downturn. We continue to monitor all of the risks within our portfolio very closely and proactively deal with problem loans identified by our loan review process.”
Retail deposit balances decreased $34.9 million during the quarter, reflecting planned reductions in non-core funding from customers outside Peoples’ primary market area, but remained nearly $40 million higher than year-end, due to higher savings, money market and non-interest bearing checking balances. Total wholesale funding increased slightly since March 31, 2009, as additional long-term brokered deposits were mostly offset by repayments of long-term FHLB advances. Since year-end 2008, total borrowed funds were down $56.1 million at June 30, 2009, while brokered deposits increased only slightly.
At June 30, 2009, Peoples’ Tier 1 Common, Total Tier 1 and Total Risk-Based Capital ratios were 10.24%, 14.85% and 16.19%, compared to the well capitalized minimum ratios of 4%, 6% and 10%, respectively. Tangible equity to tangible assets was 8.74% at June 30, 2009, versus 8.24% last quarter and 6.21% at year-end, while tangible common equity to tangible assets was 6.78%, 6.31% and 6.21%, respectively.
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 47 locations and 39 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank); and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly-traded companies. Learn more about Peoples at www.peoplesbancorp.com.
Conference Call to Discuss Earnings:
Peoples will conduct a facilitated conference call to discuss second quarter 2009 results of operations today at 11:00 a.m., Eastern Daylight Savings Time, with members of Peoples’ executive management participating. Analysts, media and individual investors are invited to participate in the conference call by calling (800) 860-2442. A simultaneous Webcast of the conference call audio will be available online via the “Investor Relations” section of Peoples’ website, www.peoplesbancorp.com. Participants are encouraged to call or sign in at least 15 minutes prior to the scheduled conference call time to ensure participation and, if required, to download and install the necessary software. A replay of the call will be available on Peoples’ website in the “Investor Relations” section for one year.
Safe Harbor Statement:
Certain statements made in this news release regarding Peoples’ financial condition, results of operations, plans, objectives, future performance and business, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by the fact they are not historical facts and include words such as “anticipate”, “may”, “feel”, “expect”, “believe”, “plan”, and similar expressions.
These forward-looking statements reflect management’s current expectations based on all information available and its knowledge of Peoples’ business and operations. Additionally, Peoples’ financial condition, results of operations, plans, objectives, future performance and business are subject to risks and uncertainties that may cause actual results to differ materially. These factors include, but are not limited to: (1) continued deterioration in the credit quality of Peoples’ loan portfolio could occur due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than otherwise assumed and assumed cash flows may be less favorable than expected, which may adversely impact the provision for loan losses; (2) competitive pressures among financial institutions or from non-financial institutions, which may increase significantly; (3) changes in the interest rate environment, which may adversely impact interest margins; (4) changes in prepayment speeds, loan originations, and charge-offs, which may be less favorable than expected and adversely impact the amount of interest income generated; (5) general economic conditions and weakening in the economy, specifically the real estate market, either national or in the states in which Peoples does business, which may be less favorable than expected; (6) political developments, wars or other hostilities, which may disrupt or increase volatility in securities markets or other economic conditions; (7) legislative or regulatory changes or actions, which may adversely affect the business of Peoples and its subsidiaries; (8) adverse changes in the conditions and trends in the financial markets, which may adversely affect the fair value of securities within Peoples’ investment portfolio; (9) a delayed or incomplete resolution of regulatory issues that could arise; (10) Peoples’ ability to receive dividends from its subsidiaries; (11) the impact of larger or similar financial institutions encountering problems, which may adversely affect the banking industry and/or Peoples; (12) changes in accounting standards, policies, estimates or procedures, which may impact Peoples’ reported financial condition or results of operations; (13) Peoples’ ability to maintain required capital levels and adequate sources of funding and liquidity; (14) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity; (15) the costs and effects of regulatory and legal developments, including the outcome of regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; and (16) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (“SEC”), including those risk factors included in the disclosures under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
Peoples encourages readers of this news release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements. Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.
Please click here to view the complete earnings release.
PEOPLES BANCORP INC. DECLARES
SECOND QUARTER 2009 DIVIDEND
___________________________________________
May 28, 2009
Contact: Mark F. Bradley
President and Chief Executive Officer
(740) 373-3155
MARIETTA, Ohio - The Board of Directors of Peoples Bancorp Inc. (NASDAQ: PEBO) today declared a cash dividend of $0.23 per share payable July 1, 2009, to common shareholders of record on June 15, 2009.
The second quarter dividend represents a payout of approximately $2.4 million, based on 10.4 million shares outstanding at May 28, 2009, and is equal to the dividend declared for the first quarter of 2009. The annualized 2009 dividend of $0.92 equates to a yield of 5.59% based on Peoples’ closing stock price of $16.47 on May 27, 2009.
Peoples Bancorp Inc. is a diversified financial products and services company with $2.1 billion in assets at March 31, 2009, 50 locations and 39 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc., which includes the Putnam and Barengo divisions. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
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PEOPLES BANK OPENS NEW FINANCIAL SERVICES
OFFICE IN ZANESVILLE, OHIO
___________________________________________
May 14, 2009
Contact: Mark F. Bradley
President and Chief Executive Officer
(740) 373-3155
Extended banking hours offered for added convenience
MARIETTA, Ohio - Peoples Bank, a subsidiary of Peoples Bancorp Inc. (Nasdaq: PEBO), recently opened its first financial services office in Zanesville, Ohio.
“Expansion into Muskingum County has been one of our strategic goals,” said Mark F. Bradley, President and Chief Executive Officer of Peoples Bancorp Inc. and Peoples Bank. “We have been providing financial solutions to clients in southeastern Ohio for over 100 years and believe that our service and delivery options will also be positives for the residents and businesses in the Zanesville area.”
The office held ribbon cutting and grand opening ceremonies on May 14th with local dignitaries and business members attending.
“We offer our full array of commercial and consumer banking services, along with a drive-up ATM and drive-thru facility for added customer convenience,” continued Bradley. “Our professionals with Peoples Financial Advisors and Peoples Insurance Agency are also located in the new office, so we can make available investment, insurance and banking needs from a single location.”
The Zanesville office, located at the corner of Zane and Underwood Streets, expands Peoples Bank’s presence to 50 offices in Ohio, West Virginia and Kentucky. Peoples Bank also has five offices in neighboring Guernsey and Morgan Counties.
“The new office provides increased visibility and demonstrates our commitment to the growth and success of Zanesville,” said Deborah K. Hill, Executive Vice President, Consumer and Business Financial Services. “We offer clients the ability to satisfy all their financial needs in one place, plus the convenience of banking from 7:00 am to 7:00 pm.”
Clients interested in more information concerning Peoples’ products and services in Muskingum County may contact Heather Shoenleben, Office Manager, or Carl Raines, Senior Vice President at (740) 588-0100.
Peoples Bancorp Inc., a diversified financial products and services company with $2.1 billion in assets, makes available a complete line of banking, investment, insurance, and trust solutions through 50 locations and 39 ATMs in Ohio, West Virginia, and Kentucky. Peoples Bancorp’s financial service units include Peoples Bank, Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc., which includes the Putnam and Barengo divisions. Peoples Bancorp’s common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO” and Peoples Bancorp is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
End of Release
PEOPLES BANCORP INC. ANNOUNCES
FIRST QUARTER RESULTS
___________________________________________
April 21, 2009
Contact: Edward G. Sloane
Chief Financial Officer and Treasurer
(740) 373-3155
MARIETTA, Ohio - Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) today announced first quarter 2009 net income of $4.2 million compared to $5.6 million earned in the first quarter of 2008, as improvements in net interest income were more than offset by an increased provision for loan losses. Diluted earnings per common share were $0.37 and $0.55 for the three months ended March 31, 2009 and 2008, respectively, which include the impact of preferred dividends on net income available to common shareholders.
“We are pleased with first quarter results considering the extremely challenging market conditions and economic uncertainty,” said Mark F. Bradley, President and Chief Executive Officer. “Like many financial institutions, first quarter provision for loan losses and charge-offs, although lower than recent quarters, remained at higher than historical levels, due to the continued adverse affects of a recessionary economy on real estate values and some of our commercial borrowers. We remain diligent in dealing with the credit issues within our loan portfolio and are encouraged by some stability in nonperforming asset levels during the first quarter.”
Bradley continued, “Despite the tough conditions, we made positive progress in several key areas, including increased net interest income, deposit growth and reductions in wholesale borrowings. We also strengthened the capital positions of both Peoples and Peoples Bank and successfully contained operating costs, with first quarter expense growth mostly isolated to increased FDIC insurance premiums and higher costs associated with under performing loans. Mortgage banking activity increased significantly, generating additional first quarter non-interest revenue, while other consumer lending showed steady growth.”
On January 30, 2009, Peoples received $39 million of equity capital from the U.S. Treasury’s TARP Capital Purchase Program, through the sale of 39,000 newly-issued non-voting Fixed Rate Cumulative Perpetual Preferred Shares, Series A (the “Series A Preferred Shares”) and a related 10-year warrant to purchase 313,505 common shares. While first quarter 2009 diluted earnings per common share were impacted by accrued dividends of $341,000 on the Series A Preferred Shares, this capital investment allowed Peoples to improve its already strong regulatory capital ratios and increase tangible equity during the first quarter. At March 31, 2009, Peoples’ Tier 1 Capital ratio was 14.80% and the Total Capital ratio was 16.08%, which remain well above the minimum ratios of 6% and 10%, respectively, required to be considered “well-capitalized” by banking regulations. Tangible equity to tangible assets was 8.24% at quarter-end compared to 6.21% at December 31, 2008.
During the first quarter of 2009, retail deposit balances, which exclude brokered deposits, grew $74.4 million, or 23% on an annualized basis, to $1.40 billion at quarter-end. The largest growth occurred in interest-bearing demand accounts, which increased $27.8 million, due mostly to a build-up of governmental deposit balances from tax revenues. Money market deposit balances increased 7% as Peoples continues to offer a highly competitive rate to customers. Also at quarter-end, Peoples’ savings and non-interest bearing balances were up 9% and 6%, respectively, since year-end 2008. Both of these increases reflect seasonal growth typically experienced during the first quarter of each year. At March 31, 2009, brokered deposits were down $19.2 million, or 43%, since year-end 2008, and total borrowings decreased $44.2 million, or 10%, due mostly to the elimination of overnight wholesale borrowings, which totaled $44.4 million at December 31, 2008.
“Funds generated from retail deposit growth and the TARP Capital Purchase Program allowed us to reduce short-term wholesale funding levels in the first quarter,” said Edward G. Sloane, Chief Financial Officer. “We are working to deploy the TARP capital funds into loans that meet prudent underwriting standards. We also anticipate using deposit growth to reduce wholesale funding levels even further as long-term borrowings mature throughout the year.”
In the first quarter of 2009, net interest income was $15.5 million, up 6% from the linked quarter, while net interest margin expanded 8 basis points to 3.52%. These improvements resulted from a 7% reduction in interest expense and stable interest income. Interest expense benefited from opportunities to reduce Peoples’ overall cost of funds provided by growth in lower-cost deposits and lower short-term market rates. First quarter interest income was challenged by lower asset yields from increased refinancing and downward repricing of variable rate assets, although the impact was offset by a higher level of earning assets. Compared to the prior year, first quarter net interest income was up 9%, largely attributable to higher earning asset levels, while net interest margin was basically unchanged as higher investment yields offset a reduction in loan yields.
“First quarter net interest income and margin exceeded our expectations, due mostly to stronger than anticipated deposit growth and reductions in overall cost of funds,” said Sloane. “We are also continuing to see benefits from our proactive interest rate risk management and steps taken in 2008 designed to position the balance sheet for an eventual rising interest rate environment. During the remainder of 2009, our focus will be on maintaining net interest income levels through effective balance sheet management.”
Non-interest income also remained strong in the first quarter of 2009, with increased mortgage banking income offset by lower revenues from other major sources. As a result, total non-interest income for the three months ended March 31, 2009, was consistent with the same period last year, totaling $8.2 million. Compared to the fourth quarter of 2008, non-interest income increased 5%, due to the higher mortgage banking income, coupled with recognition of annual performance based insurance revenue of $768,000 received during the first quarter.
At March 31, 2009, Peoples’ allowance for loan losses stood at $24.1 million, or 2.19% of total loans, up from $22.9 million, or 2.08% of total loans, at December 31, 2008, and $16.0 million, or 1.43%, at March 31, 2008. First quarter 2009 net loan charge-offs totaled $2.9 million, comprised mainly of write-downs on four unrelated commercial loans, previously identified as being impaired during 2008, in response to further credit deterioration of the borrowers and underlying collateral values. In comparison, net charge-offs were $9.7 million last quarter and $1.2 million a year ago, which included write-downs on impaired loans of $8.2 million and $1.0 million, respectively. The elevated level of charge-offs in recent quarters, coupled with the continued distressed economic conditions, were key drivers behind the build up of the allowance for loan losses. These factors also caused Peoples to record a provision for loan losses of $4.1 million for the first quarter of 2009, versus $13.4 million and $1.4 million for the fourth and first quarters of 2008, respectively.
Gross portfolio loan balances were $1.10 billion at March 31, 2009, down $3.1 million compared to year-end 2008. Increased consumer lending was offset by a reduction in portfolio residential real estate loans as more loans were sold to the secondary market. Loan balances were also impacted by the first quarter write-downs on impaired loans and slower commercial lending activity. As a result, nonperforming loans comprised $38.6 million, or 3.50%, of gross loans, down from $41.3 million, or 3.74%, at December 31, 2008. Compared to a year ago, gross loan balances were down $14.8 million at quarter-end, mainly attributable to charge-offs, while nonperforming loans remained at higher levels as a result of loans placed on nonaccrual status during the latter part of 2008.
“Asset quality showed signs of stabilization in the first quarter, as we continue working through problem loans identified in 2008,” said Sloane. “In addition, mortgage and consumer loans continue to perform well and delinquencies remain reasonable. New loan production in the first quarter was slightly higher than a year ago, despite the depressed conditions in the real estate markets and general economy. Our mortgage banking activity and serviced loan portfolio increased significantly during the first quarter, while consumer lending has remain steady. We are also using our stronger capital position to provide appropriate relief to struggling mortgage and consumer borrowers.”
Mortgage banking activity intensified during the first quarter of 2009 as many clients took advantage of lower interest rates and other opportunities offered by the secondary market to refinance existing loans. This increased activity caused a substantial growth in first quarter mortgage loans being serviced by Peoples and related mortgage banking income, which nearly tripled to $601,000 compared to $204,000 a year ago. Deposit account service charges were also up 5% compared to the prior year first quarter. The impact of these increases on total non-interest income was offset by lower trust and investment income, attributable to an overall reduction in market values of investments, and a decline in property and casualty insurance commissions from the effects of a contracting economy on commercial insurance needs, coupled with lower pricing margins within the insurance industry.
In the first quarter of 2009, non-interest expense totaled $14.5 million, up 6% year-over-year and up 7% on a linked quarter basis. These increases were due mostly to increased FDIC insurance expense and higher loan-related costs, primarily external legal and valuation services. Contributing to the year-over-year increase was higher first quarter electronic banking expense as a result of Peoples adjusting Visa-related litigation accruals during the first quarter of 2008, which lowered 2008 first quarter non-interest expense. First quarter salaries and employee benefit costs were down compared to the prior year, reflecting lower corporate incentive plan and stock-based compensation expenses that more than offset increases in employee medical benefit and pension plan costs, which were the main driver of the 7% linked quarter increase in total salaries and employee benefit costs.
“Overall, we have made positive progress towards achieving our 2009 operating goals by controlling expenses, maintaining a strong, diversified revenue stream and modestly improving asset quality,” summarized Bradley. “In the first quarter, we fortified our already healthy capital position and expanded lending activities as a result of the TARP capital investment. Several recent developments, coupled with increasing uncertainty regarding future restrictions, are causing us to consider opportunities to repay the TARP funds sooner than the 3 to 5 years originally planned. However, any decision to repay the TARP funds will be contingent on asset quality, total capital and liquidity levels that support expanded lending activities during these challenging times and generate long-term shareholder value.”
Peoples Bancorp Inc. is a diversified financial products and services company with $2.1 billion in assets, 49 locations and 38 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank); and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly-traded companies. Learn more about Peoples at www.peoplesbancorp.com.
Conference Call to Discuss Earnings:
Peoples will conduct a facilitated conference call to discuss first quarter 2009 results of operations today at 11:00 a.m., Eastern Daylight Savings Time, with members of Peoples’ executive management participating. Analysts, media and individual investors are invited to participate in the conference call by calling (800) 860-2442. A simultaneous Webcast of the conference call audio will be available online via the “Investor Relations” section of Peoples’ website, www.peoplesbancorp.com. Participants are encouraged to call or sign in at least 15 minutes prior to the scheduled conference call time to ensure participation and, if required, to download and install the necessary software. A replay of the call will be available on Peoples’ website in the “Investor Relations” section for one year.
Safe Harbor Statement:
Certain statements made in this news release regarding Peoples’ financial condition, results of operations, plans, objectives, future performance and business, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by the fact they are not historical facts and include words such as “anticipate”, “may”, “feel”, “expect”, “believe”, “plan”, and similar expressions.
These forward-looking statements reflect management’s current expectations based on all information available and its knowledge of Peoples’ business and operations. Additionally, Peoples’ financial condition, results of operations, plans, objectives, future performance and business are subject to risks and uncertainties that may cause actual results to differ materially. These factors include, but are not limited to: (1) continued deterioration in the credit quality of Peoples’ loan portfolio could occur due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than otherwise assumed and assumed cash flows may be less favorable than expected, which may adversely impact the provision for loan losses; (2) competitive pressures among financial institutions or from non-financial institutions, which may increase significantly; (3) changes in the interest rate environment, which may adversely impact interest margins; (4) changes in prepayment speeds, loan originations, and charge-offs, which may be less favorable than expected and adversely impact the amount of interest income generated; (5) general economic conditions and weakening in the economy, specifically the real estate market, either national or in the states in which Peoples does business, which may be less favorable than expected; (6) political developments, wars or other hostilities, which may disrupt or increase volatility in securities markets or other economic conditions; (7) legislative or regulatory changes or actions, which may adversely affect the business of Peoples and its subsidiaries; (8) adverse changes in the conditions and trends in the financial markets, which may adversely affect the fair value of securities within Peoples’ investment portfolio; (9) a delayed or incomplete resolution of regulatory issues that could arise; (10) Peoples’ ability to receive dividends from its subsidiaries; (11) the impact of larger or similar financial institutions encountering problems, which may adversely affect the banking industry and/or Peoples; (12)changes in accounting standards, policies, estimates or procedures, which may impact Peoples’ reported financial condition or results of operations; (13) Peoples’ ability to maintain required capital levels and adequate sources of funding and liquidity; (14) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity; (15) the costs and effects of regulatory and legal developments, including the outcome of regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; and (16) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (“SEC”), including those risk factors included in the disclosures under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
Peoples encourages readers of this news release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements. Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.
Please click here to view the complete earnings release.
PEOPLES BANK TO CONSOLIDATE BANKING OFFICES
___________________________________________
March 16, 2009
Contact: Mark F Bradley
President and Chief Executive Officer
(740) 373-3155
MARIETTA, Ohio - Peoples Bank, National Association (“Peoples Bank”) a subsidiary of Peoples Bancorp Inc. (Nasdaq: PEBO), announced plans to consolidate two banking offices into existing Peoples Bank locations. Effective June 30, 2009, Peoples Bank will close its banking offices in Rutland, Ohio (Meigs County) and Lower Salem, Ohio (Washington County).
“The consolidations will streamline operations while enabling us to continue serving our clients,” said Mark F. Bradley, President and Chief Executive Officer of Peoples Bancorp Inc. and Peoples Bank. “We do not anticipate any job loss as our associates will be employed at other nearby Peoples Bank offices.”
After the consolidations, Peoples Bank will have two locations in Meigs County and eight offices in Washington County. In Lower Salem, the U.S. Post Office and food pantry located in the Peoples Bank building will remain open. The Tri-County Food Pantry serves residents of Washington, Noble and Monroe Counties and has operated from the Peoples Bank building for the past several years.
“We appreciate the opportunity to serve clients in Rutland and Lower Salem,” added Bradley. “We look forward to continuing to provide quality financial services from other nearby locations.”
Peoples Bank also announced plans to open a new full-service office in Zanesville, Ohio and combine current operations in Nelsonville, Ohio into a new facility. In April 2009, Peoples Bank plans to open a full-service office in Zanesville, Ohio at the corner of Zane and Underwood Streets. The new Zanesville office will be Peoples Bank’s first location in Muskingum County and will offer loan, deposit, insurance and investment services with the convenience of motor banking and a drive-up ATM. In May 2009, Peoples Bank will combine its two Nelsonville, Ohio banking offices into a new full-service facility along State Route 33 at 951 Canal Street in Nelsonville. Currently Peoples Bank operates an office in downtown Nelsonville along with a separate motor banking office.
“We look forward to expansion into Zanesville, plus improved efficiencies and visibility in Nelsonville,” said Bradley. “Especially in today’s market place, it is important to continually analyze delivery channels and plan for growth in viable markets, while maintaining client service as a main focus.”
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 49 locations and 38 ATMs in Ohio, West Virginia and Kentucky. Peoples Bancorp Inc. makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc. Peoples Bancorp Inc.’s common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples Bancorp Inc. is a member of the Russell 3000 index of US publicly traded companies. Learn more at www.peoplesbancorp.com.
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DAVID WESEL NAMED EXECUTIVE VICE PRESIDENT, INVESTMENT AND INSURANCE SERVICES
___________________________________________
March 4, 2009
Contact: Mark F Bradley
President and Chief Executive Officer
(740) 373-3155
MARIETTA, Ohio - Peoples Bancorp Inc. (Nasdaq: PEBO) announces the appointment of David T. Wesel to Executive Vice President, Investment and Insurance Services.
"David has been a strong leader of Peoples Financial Advisors, our investment, trust, and brokerage service provider,” said Mark F. Bradley, Peoples Bancorp Inc. President and Chief Executive Officer. “He will continue his leadership of Peoples Financial Advisors. David’s new duties include direct management of our insurance sales and service efforts as we further integrate our client based initiatives."
Wesel joined Peoples Bancorp Inc. in 2004. He serves as an executive officer of Peoples Bancorp Inc. and Peoples Bank, National Association (“Peoples Bank”).
Wesel has also been appointed President of Peoples Insurance Agency, Inc. (a subsidiary of Peoples Bank), a full-service insurance agency offering life, health, and property and casualty insurance to businesses and individuals, and includes the Putnam Agency and Barengo Insurance divisions. Previously, Bradley served as President of Peoples Insurance Agency, Inc.
"David’s contributions as a member of Peoples Bancorp’s executive management and strategic planning teams have demonstrated his ability for this new responsibility,” continued Bradley. “In the last 5 years, revenues from investment and insurance operations have increased over $5 million to $15 million, making insurance and investment services an important part of our future growth strategies.”
Wesel has 24 years experience in executive management and sales/service administration. He is a graduate of The Ohio State University and earned an MBA from Ohio University in 1997. Wesel has served as President of Peoples Financial Advisors since January 1, 2006.
“I am confident David will continue to be successful in this next level of leadership,” summarized Bradley. “I look forward to seeing more positives as we execute on our strategies to deliver quality financial advice and services to our clients.”
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 49 locations and 38 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
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PEOPLES BANCORP INC. DECLARES FIRST QUARTER 2009 DIVIDEND
___________________________________________
February 26, 2009
Contact: Mark F Bradley
President and Chief Executive Officer
(740) 373-3155
MARIETTA, Ohio - The Board of Directors of Peoples Bancorp Inc. (NASDAQ: PEBO) today declared a cash dividend of $0.23 per share payable on April 1, 2009, to shareholders of record at March 16, 2009.
The first quarter dividend represents a payout of approximately $2.4 million, based on 10.4 million shares outstanding at February 26, 2009, and is equal to the dividend declared for the fourth quarter of 2008.
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 49 locations and 38 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
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PEOPLES BANCORP INC. RECEIVES $39 MILLION FROM
U.S. TREASURY CAPITAL PURCHASE PROGRAM
___________________________________________
February 2, 2009
Contact: Mark F Bradley
President and Chief Executive Officer
(740) 373-3155
MARIETTA, Ohio –Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) today announced it received $39 million of new equity capital on January 30, 2009, from the TARP Capital Purchase Program established by the United States Department of the Treasury (the “U.S. Treasury”) under the Emergency Economic Stabilization Act of 2008.
"We look forward to putting the funds to work in our communities,” said Mark F. Bradley, President and Chief Executive Officer. “We are pleased that our financial strength qualified Peoples to participate in the Capital Purchase Program, which provides a cost-effective means for well-capitalized financial institutions like Peoples to fortify capital positions in times of economic challenge.”
At December 31, 2008, Peoples’ Tier 1 and Total Risk-Based Capital ratios were 11.87% and 13.18%, respectively, which were well above the minimum ratios of 6% and 10%, respectively, required by banking regulations to be considered “well-capitalized”. With the additional capital from the Capital Purchase Program, Peoples’ Tier 1 and Total Risk-Based Capital ratios will increase to 13.55% and 16.15%, using the risk-based capital data at December 31, 2008.
The investment by the U.S. Treasury was in the form of newly-issued non-voting Fixed Rate Cumulative Perpetual Preferred Shares, Series A (“Senior Preferred Shares”) and a related 10-year Warrant to Purchase Common Stock (the “Warrant”) sold by Peoples to the U.S. Treasury. The Senior Preferred Shares will pay an annual dividend of 5% during the first five years and 9% each year thereafter, unless redeemed by Peoples. The Warrant will entitle the holder to purchase 313,505 Peoples common shares with an exercise price of $18.66. Other details of this transaction, including certain restrictions and limitations imposed on Peoples, are contained in a Current Report on Form 8-K being filed by Peoples with the Securities and Exchange Commission later today.
On January 22, 2009, Peoples’ shareholders approved an amendment to Peoples’ Amended Articles of Incorporation authorizing the issuance of preferred shares. On January 28, 2009, Peoples’ Board of Directors adopted an amendment to Peoples’ Amended Articles of Incorporation establishing a series of preferred shares with the express terms of the Senior Preferred Shares issued to the U.S. Treasury.
"Despite adverse conditions, we remain an active lender, with our bankers making loans that meet prudent underwriting standards given these difficult times,” said Bradley. “Our primary intent is to use the new capital for loan originations. Our stronger capital position also affords Peoples greater capacity to work through problem loans and to provide appropriate relief to struggling mortgage and consumer borrowers.”
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 49 locations and 38 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
Safe Harbor Statement:
This news release contains certain statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder. In particular, this release includes forward-looking statements regarding the potential benefits of Peoples’ participation in the Capital Purchase Program and the potential impact participation could have on Peoples’ future results of operations and financial condition. These statements are subject to certain risks and uncertainties including Peoples’ ability to deploy the capital received through the Capital Purchase Program and the other risks set forth in Peoples’ filings with the Securities and Exchange Commission, including those risk factors included in the disclosure under the heading “ITEM 1A. RISK FACTORS” of Part I of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2007. As a result, actual results may differ materially from the forward-looking statements in this news release. Peoples encourages readers of this news release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements. Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.
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PEOPLES BANCORP INC. ANNOUNCES 2008 RESULTS
___________________________________________
January 26, 2009
Contact: Edward Sloane
Chief Financial Officer and Treasurer
(740) 373-3155
MARIETTA, Ohio – Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) today announced 2008 net income of $7.5 million and diluted earnings per share of $0.72, compared to $18.3 million and $1.74, respectively, in 2007. For the fourth quarter 2008, Peoples reported a net loss of $3.1 million, or $0.30 per diluted share. This loss resulted from a $13.4 million provision for loan losses and a $4.0 million ($2.6 million after-tax) non-cash impairment charge related to certain available-for-sale investment securities. Peoples earned net income of $3.0 million, or $0.28 per diluted shares, last quarter, and $2.2 million, or $0.21 per diluted share, for the fourth quarter of 2007.
“Our 2008 results reflect the challenging conditions within the financial services industry due to the contracting economy and commercial real estate market,” said Mark F. Bradley, President and Chief Executive Officer. “In the fourth quarter, the sustained weakness caused further declines in commercial real estate values and deterioration in financial condition of various commercial borrowers. These conditions led to several impaired loans becoming under-collateralized due to the reduction in the estimated net realizable fair value of the underlying collateral. We also downgraded various commercial real estate loans, which resulted in certain loans being placed on nonaccrual status. This deterioration in loan quality dictates increasing our allowance for loan losses in the fourth quarter.”
Bradley continued, “Despite the very challenging environment in 2008, we generated positive results in several key areas, including increased total revenues, retail deposit growth and expense control. We also took steps to strengthen Peoples’ capital position and liquidity levels to allow us greater flexibility to work through the credit issues within the loan portfolio.”
During the fourth quarter of 2008, Peoples increased its allowance for loan losses to $22.9 million, or 2.08% of total loans, at December 31, 2008, from $19.2 million, or 1.72%, at the prior quarter-end and $15.7 million, or 1.40%, at year-end 2007. This increase reflects the changes in loan quality during the fourth quarter and was based on management’s quarterly analysis of the loan portfolio and estimation of probable credit losses. This procedural methodology considers all significant information currently available regarding the factors that affect losses, such as changes in Peoples’ loan quality, historical loss experience and current economic conditions.
Fourth quarter 2008 net loan charge-offs were $9.7 million, compared to $2.1 million and $0.4 million for the third quarter of 2008 and fourth quarter of 2007, respectively. The increase in net charge-offs was due primarily to $8.2 million of declines in collateral values securing certain impaired loans during the fourth quarter of 2008. These determinations were made in connection with management’s evaluation of the adequacy of the allowance for loan losses at December 31, 2008, and based upon updated analyses of collateral values received during the fourth quarter. In 2008, net charge-offs totaled $20.4 million versus $2.8 million in 2007.
Peoples recorded a provision for loan losses of $13.4 million for the fourth quarter of 2008, compared to $6.0 million and $1.5 million for the third quarter of 2008 and fourth quarter of 2007, respectively. The higher provision for loan losses in the fourth quarter of 2008 resulted from the increase in the allowance for loan losses, coupled with larger than previously estimated losses on impaired loans, due to the further downturn in the commercial real estate market and the economy in general during the quarter. These adverse conditions continue to cause deterioration in credit quality within Peoples’ commercial loan portfolio and declines in commercial real estate collateral values.
Nonperforming loans totaled $41.3 million, or 3.74% of total loans, at December 31, 2008, compared to $35.7 million, or 3.21%, at September 30, 2008, and $9.4 million, or 0.83% at year-end 2007. During the fourth quarter of 2008, Peoples placed three commercial real estate loan relationships totaling $10.3 million on nonaccrual status. This increase was partially offset by $5.3 million of charge-offs on existing nonaccrual loans, due to declines in collateral values. Total nonperforming assets were $41.8 million, or 2.09% of total assets, at December 31, 2008, compared to $36.0 million, or 1.88%, at September 30, 2008 and $9.7 million, or 0.51%, at December 31, 2007.
"Adverse economic conditions and declining real estate values during the fourth quarter intensified and placed added pressure on our commercial customers,” said Edward G. Sloane, Chief Financial Officer. “However, the impact on the other segments of our loan portfolio has been less severe, with minimal changes in delinquency levels and losses. We continue to be proactive in identifying potential problem loans and remain diligent in our collection efforts.”
In the fourth quarter of 2008, Peoples recorded a $4.0 million other-than-temporary impairment charge, of which $2.0 million related to a single bank-issued trust preferred security previously carried at $2.0 million and $2.0 million related to four collateralized debt obligation (“CDO”) investments previously carried at $6.1 million. These charges were based upon management’s evaluation of the credit quality of underlying issuers. In comparison, Peoples recorded a $5.5 million impairment charge in the fourth quarter of 2007, related to its CDO investments and preferred stocks issued by the Federal National Mortgage Association (“Fannie Mae”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”).
Throughout 2008, Peoples has proactively managed its investment portfolio to reduce credit and interest rate exposures. These actions have included the systematic sale of Fannie Mae and Freddie Mac preferred stocks, which reduced Peoples’ exposure to additional losses from those investments. Peoples also sold selected lower yielding longer-term investment securities and reinvested the net proceeds into similar securities with less price risk volatility. During the fourth quarter of 2008, Peoples took further steps to reposition the investment portfolio, which produced a $1.5 million ($1.0 million after-tax) securities gain.
Also in the fourth quarter of 2008, Peoples completed the sale of its Grayson, Kentucky banking office and sold its merchant credit card payment processing services, which generated an aggregate fourth quarter pre-tax gain of $775,000. These transactions were part of Peoples’ ongoing efforts to improve operating efficiencies by redirecting resources to areas with better growth potential.
Throughout 2008, the capital positions of Peoples and its banking subsidiary have remained well above amounts needed to be considered well-capitalized by banking regulations. At December 31, 2008, Peoples’ Tier 1 and Total Risk-Based capital ratios were 11.87% and 13.18%, respectively, compared to the prior year ratios of 11.91% and 13.23%, respectively, while the ratio of tangible equity to tangible assets was 6.21% at year-end 2008. At the January 22, 2009 Special Meeting of Shareholders, Peoples’ shareholders approved an amendment to Peoples’ Amended Articles of Incorporation authorizing the issuance of preferred shares. This authorization enables Peoples to obtain final approval for a $39 million capital investment through the TARP Capital Purchase Program established by the U.S. Department of Treasury. Peoples expects to issue the entire $39 million of cumulative perpetual preferred shares. After the issuance of these cumulative perpetual preferred shares, Peoples’ Total Risk-Based Capital ratio is expected to exceed 16%. A Total Risk-Based Capital ratio of 10% is needed to be considered “well capitalized” by banking regulations.
"Our emphasis on protecting capital during 2008 is reflected in the relatively stable ratios compared to the prior year-end despite the elevated level of losses recognized,” said Sloane. “Already in 2009, we have taken steps to fortify our capital position through our anticipated participation in the TARP Capital Purchase Program. The additional capital will be used to continue making loans to qualified individuals and businesses, as we maintain our commitment to the communities we serve.”
Fourth quarter 2008 net interest income totaled $14.7 million, consistent with the prior quarter. However, net interest margin compressed 6 basis points to 3.44%, due to the decline in Peoples’ asset yields from the downward repricing of prime-based loans in response to the Federal Reserve’s monetary actions, coupled with the impact of the additional nonaccrual loans and charge-offs, and limited opportunities to lower funding costs. Compared to the fourth quarter of 2007, net interest income grew 6% and net interest margin expanded 4 basis points. For the year, net interest income increased 8% to $58.5 million in 2008 and net interest margin expanded 19 basis points to 3.51%. These improvements were driven by lower short-term market rates and resulted in a greater reduction in Peoples’ funding costs in comparison to asset yields. Net interest income and margin also benefited from retail deposit growth in 2008, which has allowed Peoples to reduce the amount of higher-cost wholesale funding.
Peoples’ net interest income and margin include loan prepayment fees, interest reductions for loans placed on nonaccrual status and interest collected on nonaccrual loans. The net impact of these items was a $75,000 reduction in income, or two basis points of margin, in the fourth quarter of 2008, compared to a $241,000, or five basis points, reduction in the third quarter of 2008 and $50,000, or one basis point, reduction in the fourth quarter of 2007.
"In the fourth quarter of 2008, short-term rates fell to historically low levels, due to aggressive action by the Federal Reserve,” said Sloane. “Although the reduction in market rates compressed net interest margin, net interest income was stable due to additional earning assets. Net interest margin pressure could intensify if the Federal Reserve keeps rates at current ultra-low levels for an extended period. We have shifted our balance sheet to an asset sensitive interest rate risk position in preparation for a rising interest rate environment and will monitor our interest rate risk exposures closely in an effort to preserve this balance sheet position.”
Total non-interest income was $7.8 million in the fourth quarter of 2008, up 3% over the prior year fourth quarter. Deposit account service charges and insurance revenues were both up 8%, while trust and investment income decreased 9%, due mostly to declining market values of managed assets. Compared to the third quarter of 2008, non-interest income was down 4%, largely reflecting the normal fluctuation in insurance revenues based on the timing of policy renewals. In 2008, non-interest income totaled $32.1 million versus $31.4 million in 2007, as gains in several areas were partially offset by lower mortgage banking income. The largest gain occurred in Peoples’ electronic banking income, which increased 10% due to sustained growth in debit card activity.
Non-interest expense totaled $13.5 million for the fourth quarter of 2008, up 2% compared to last quarter and up 9% year-over-year. For the year, total non-interest expense was $53.5 million in 2008 versus $51.5 million in 2007. During the fourth quarter of 2008, Peoples incurred higher FDIC insurance expense compared to recent periods, due to a modest increase in assessment rates, coupled with the impact of utilizing the $1 million one-time credit received in 2007. Peoples’ franchise tax expense was also up year-over-year, due to the $782,000 reduction in fourth quarter 2007’s expense from the resolution of matters related to Peoples’ Ohio corporation franchise tax liabilities in 2007. Fourth quarter salary and benefit costs were unchanged from the prior quarter, but increased modestly year-over-year, due to the combination of normal base salary adjustments and higher employee medical benefit costs. For the year, salary and benefit costs increased 4% to $28.5 million, as a reduction in incentive plan expense tied to Peoples’ full year 2008 results of operation partially offset the higher base salaries and employee medical benefit costs.
"The difficult operating environment during 2008 caused us to place even greater emphasis on non-interest revenue levels and diversification, while at the same time controlling operating expenses,” said Sloane. “Overall, our non-interest revenue stream remains strong, although fiduciary and brokerage revenues continue to be impacted by the downturn in the market values of investments. In addition, we controlled expenses, with much of the year-over-year increase isolated to higher deposit insurance premiums, additional franchise tax expense, modest base salary adjustments and higher employee medical benefit costs.”
Peoples’ effective tax rate was 2.1% for the year ended December 31, 2008, versus 23.3% for the year ended December 31, 2007. The lower effective tax rate is largely attributable to the reduction in pre-tax income from the higher loan loss provision and impairment charges without a corresponding decrease in income from tax-exempt sources.
At December 31, 2008, total portfolio loan balances were $1.10 billion, down $9.6 million for the quarter and $16.9 million since year-end 2007, due mostly to normal commercial loan payoffs and the impact of charge-offs in 2008. These declines were partially offset by growth in home equity and consumer loan balances during 2008, which increased 12% and 9%, respectively. Peoples’ serviced real estate loan portfolio totaled $181.4 million at December 31, 2008, up from $180.4 million at September 30, 2008, and $176.7 million at December 31, 2007.
Retail deposit balances, which exclude brokered deposits, totaled $1.32 billion at December 31, 2008, up $81.3 million, or 26% annualized, for the fourth quarter of 2008, and up $195.5 million, or 17%, for the year. These increases were due mostly to growth in interest-bearing balances, primarily retail certificates of deposit (“CDs”) and money market balances. During 2008, Peoples has grown retail CDs by attracting funds from customers outside its primary market area as an alternative to higher-cost brokered deposits, which accounted for nearly $39 million of the fourth quarter growth and totaled $108 million for the year. Contributing to the fourth quarter increase in retail CD balances was a single commercial customer deposit of $18 million through the Certificate of Deposit Account Registry System (“CDARS”) program. Money market balances have increased throughout 2008 in response to Peoples offering more competitive rates, coupled with approximately $39 million of additional funds from trust customers in the fourth quarter of 2008 due to certain alternative money market funds offered by unaffiliated providers being closed to new investors. Interest-bearing transaction account balances decreased $12.4 million in the fourth quarter of 2008, primarily attributable to seasonal fluctuations in governmental deposit balances. Non-interest-bearing deposits also decreased $4.4 million for the quarter, due to lower commercial balances at December 31, 2008, but were up $5.0 million for the year, attributable to higher consumer balances. The retail deposit growth during 2008 allowed Peoples to reduce the level of higher-cost wholesale funding compared to year-end 2007.
"In 2008, any positive results related to revenue growth and enhanced customer service were overshadowed by the impact of the turmoil in the economy, housing market and lower commercial real estate valuations,” summarized Bradley. “We continue to navigate through the intense and unprecedented challenges within the financial services industry. We believe the proactive measures taken during 2008 position Peoples for improved results in 2009 and enhance our ability for greater success when conditions start to recover.”
Peoples Bancorp Inc. is a diversified financial products and services company with $2.0 billion in assets, 49 locations and 38 ATMs in Ohio, West Virginia and Kentucky. Peoples makes available a complete line of banking, investment, insurance, and trust solutions through its financial service units – Peoples Bank, National Association; Peoples Financial Advisors (a division of Peoples Bank); and Peoples Insurance Agency, Inc. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO”, and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
Conference Call to Discuss Earnings:
Peoples will conduct a facilitated conference call to discuss fourth quarter and full year 2008 results of operations today at 11:00 a.m. Eastern Daylight Time, with members of Peoples’ executive management participating. Analysts, media and individual investors are invited to participate in the conference call by calling (800) 860-2442. A simultaneous Webcast of the conference call audio will be available online via the “Investor Relations” section of Peoples’ website, www.peoplesbancorp.com. Participants are encouraged to call or sign in at least 15 minutes prior to the scheduled conference call time to ensure participation and, if required, to download and install the necessary software. A replay of the call will be available on Peoples’ website in the “Investor Relations” section for one year.
Safe Harbor Statement:
Certain statements made in this news release regarding Peoples’ financial condition, results of operations, plans, objectives, future performance and business, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by the fact they are not historical facts and include words such as “anticipate”, “feel,” “expect,” “believe,” “plan,” and similar expressions.
These forward-looking statements reflect management’s current expectations based on all information available and its knowledge of Peoples’ business and operations. Additionally, Peoples’ financial condition, results of operations, plans, objectives, future performance and business are subject to risks and uncertainties that may cause actual results to differ materially. These factors include, but are not limited to: (1) continued deterioration in the credit quality of Peoples’ loan portfolio could occur due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than otherwise assumed and assumed cash flows may be less favorable than expected, which may adversely impact the provision for loan losses; (2) competitive pressures among financial institutions or from non-financial institutions, which may increase significantly; (3) changes in the interest rate environment, which may adversely impact interest margins; (4) changes in prepayment speeds, loan originations, and charge-offs, which may be less favorable than expected and adversely impact the amount of interest income generated; (5) general economic conditions and weakening in the economy, specifically the real estate market, either national or in the states in which Peoples does business, which may be less favorable than expected; (6) political developments, wars or other hostilities, which may disrupt or increase volatility in securities markets or other economic conditions; (7) legislative or regulatory changes or actions, which may adversely affect the business of Peoples; (8) adverse changes in the conditions and trends in the financial markets, which may adversely affect the fair value of securities within Peoples’ investment portfolio; (9) a delayed or incomplete resolution of regulatory issues that could arise; (10) Peoples’ ability to receive dividends from its subsidiaries; (11) changes in accounting standards, policies, estimates or procedures, which may impact Peoples’ reported financial condition or results of operations; (12) Peoples’ ability to maintain required capital levels and adequate sources of funding and liquidity; (13) the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity; (14) the costs and effects of regulatory and legal developments, including the outcome of regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations; and (15) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples’ reports filed with the Securities and Exchange Commission (“SEC”), including those risk factors included in the disclosures under the heading “ITEM 1A. RISK FACTORS” of Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2007.
Peoples encourages readers of this news release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by applicable legal requirements. Copies of documents filed with the SEC are available free of charge at the SEC’s website at http://www.sec.gov and/or from Peoples’ website.
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PEOPLES BANCORP INC. SHAREHOLDERS
AUTHORIZE ISSUANCE OF PREFERRED SHARES
___________________________________________
Date of Annual Meeting Set for April 23, 2009
January 23, 2009
Contact: Mark F. Bradley
President and Cheif Executive Office
(740) 373-3155
MARIETTA, Ohio – At a Special Meeting of Shareholders held yesterday, the shareholders of Peoples Bancorp Inc. (“Peoples”) (NASDAQ: PEBO) adopted an amendment to Article FOURTH of Peoples’ Amended Articles of Incorporation to authorize the issuance of preferred shares. Peoples was not previously authorized to issue preferred shares under its Amended Articles of Incorporation. This action enables Peoples to obtain final approval for a $39 million capital investment through the TARP Capital Purchase Program, which was preliminarily approved on November 12, 2008.
During its regular meeting also held yesterday, Peoples’ Board of Directors fixed the date and time of the 2009 Annual Meeting of Shareholders. The meeting will be held at 10:00 a.m. Eastern Daylight Savings Time on April 23, 2009, in Marietta, Ohio. Peoples’ Board of Directors also nominated directors Carl L. Baker, Jr., George W. Broughton, Wilford D. Dimit, and Richard Ferguson for re-election by Peoples shareholders at the 2009 Annual Meeting of Shareholders. Each nominee will stand for re-election as a director of Peoples for a three-year term expiring in 2012.
Peoples also announced it will release 2008 earnings before the market opens on January 26, 2009, and host a facilitated conference call at 11:00 a.m., Eastern Standard Time, on the same date. Analysts, media and individual investors are invited to participate in the conference call by calling 800-860-2442. A simultaneous webcast of the conference call audio can be accessed via the “Investor Relations” section of Peoples’ website, www.peoplesbancorp.com, and a replay will also be available.
Peoples Bancorp Inc., a diversified financial products and services company with $2.0 billion in assets, makes available a complete line of banking, investment, insurance, and trust solutions through 49 locations and 38 ATMs in Ohio, West Virginia, and Kentucky. Peoples’ financial service units include Peoples Bank, National Association, Peoples Financial Advisors (a division of Peoples Bank) and Peoples Insurance Agency, Inc., which includes the Putnam and Barengo divisions. Peoples’ common shares are traded on the NASDAQ Global Select Market under the symbol “PEBO” and Peoples is a member of the Russell 3000 index of US publicly traded companies. Learn more about Peoples at www.peoplesbancorp.com.
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