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H. Douglas Chaffin, President and CEO, commented, "This quarter marked the beginning of the fourth year of recession for the state of Michigan, a recession that has included an unprecedented decline in real estate values. As these declines in real estate values are recognized, we continue to charge down the value of properties held as the result of foreclosure. This was accounted for in the second quarter as a result of an auction of these properties held in early June, as well as our analysis of values for the remaining properties yet to be sold. In addition, we increased our Allowance for Loan Losses to account for the lower collateral values for the various problem loans remaining in our loan portfolio. Credit related expenses remained elevated due to the costs associated with maintaining and liquidating these properties. In spite of these challenges, changes in our balance sheet structure allowed us to maintain our capital ratio at a level that significantly exceeds the regulatory 'well capitalized' minimum. Our strong capital position will help us through this prolonged recession and position us for growth when economic activity improves in southeast Michigan."
Mr. Chaffin further commented on the Company's earnings for the quarter, "Net Interest Income decreased $942,000 compared to the second quarter of 2008 due to a decrease of $86.2 million in average earning assets. The Provision for Loan Losses increased from $2.7 million in 2008 to $8 million as we built our Allowance for Loan Losses to $23.9 million, which represents 2.62% of total loans. The Allowance for Loan Losses is now at its highest level in our history and should assist us in mitigating significant additions in the near future provided loan quality stabilizes. Non interest income decreased from $3.9 million to $3.6 million as Wealth management income was impacted by the decrease in the market value of assets under management. Total non interest expense increased significantly due to an increase of $3.8 million in losses on Other Real Estate Owned (OREO) and an increase of $1.1 million in the cost of FDIC insurance. Net of these extraordinary expenses, our overall operating expenses decreased by 5.9% as a result of cost savings initiatives implemented earlier in the year."
Mr. Chaffin concluded, "We believe that economic recovery in the country will begin soon, however, we are prepared for a longer recession in Michigan. For that reason, we have taken a conservative approach in valuing our OREO assets, and we will continue to maintain our strong capital, liquidity, and allowance for loan losses. Our community banking model is needed more than ever in our markets, and we believe that we are well positioned for the eventual economic recovery."
Conference Call
MBT Financial Corp. will hold a conference call to discuss fourth quarter results on Tuesday, July 28, at 10:00 a.m. Eastern Time. The call will be webcast and can be accessed at the Investor Relations/Corporate Profile page of MBT Financial Corp.'s web site www.mbandt.com. The call can also be accessed by calling (800) 860-2442. The event will be archived on the Company's web site and available for twelve months following the call.
About the Company
MBT Financial Corp. (Nasdaq:MBTF), a single bank holding company headquartered in Monroe, Michigan, is the parent company of Monroe Bank & Trust (MBT).
Founded in 1858, MBT is one of the largest community banks in Southeast Michigan, with $1.4 billion in assets. MBT is a full-service bank, offering a complete range of business and personal accounts, credit options, and phone and online banking services. MBT's Wealth Management Group is one of the largest and most respected in Southeastern Michigan. With 25 offices, 41 ATMs, and a comprehensive array of products and services, MBT prides itself in offering an incomparable banking experience for its customers. Visit MBT's web site at www.mbandt.com.
The MBT Financial Corp. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4214
Forward-Looking Statements
Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of Section 21A of the Securities Exchange Act of 1934. Forward-looking statements which are based on various assumptions (some of which are beyond the Company's control), may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of these terms. Actual results could differ materially from those set forth in forward-looking statements, due to a variety of factors, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset/liability management, change in the financial and securities markets, including changes with respect to the market value of our financial assets, the availability of and costs associated with sources of liquidity, and the ability of the Company to resolve or dispose of problem loans. The Company undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.
MBT FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED
Quarterly
--------------------------
(dollars in thousands except per share 2009 2009
data) 2nd Qtr 1st Qtr
------------ ------------
EARNINGS
Net interest income $ 10,185 $ 10,213
FTE Net interest income $ 10,536 $ 10,565
Provision for loan and lease losses $ 8,000 $ 4,200
Non-interest income $ 3,630 $ 3,331
Non-interest expense $ 14,589 $ 11,997
Net income (loss) $ (5,373) $ (1,367)
Basic earnings (loss) per share $ (0.33) $ (0.08)
Diluted earnings (loss) per share $ (0.33) $ (0.08)
Average shares outstanding 16,182,528 16,165,841
Average diluted shares outstanding 16,193,278 16,181,966
PERFORMANCE RATIOS
Return on average assets -1.48% -0.37%
Return on average common equity -18.31% -4.53%
Base Margin 3.00% 2.89%
FTE Adjustment 0.10% 0.10%
Loan Fees 0.04% 0.05%
------------ ------------
FTE Net Interest Margin 3.14% 3.04%
Efficiency ratio 70.22% 69.70%
Full-time equivalent employees 370 383
CAPITAL
Average equity to average assets 8.10% 8.09%
Book value per share $ 6.80 $ 7.18
Cash dividend per share $ 0.01 $ 0.01
ASSET QUALITY
Loan Charge-Offs $ 6,334 $ 1,575
Loan Recoveries $ 456 $ 600
------------ ------------
Net Charge-Offs $ 5,878 $ 975
Allowance for loan and lease losses $ 23,875 $ 21,753
Nonaccrual Loans $ 61,917 $ 50,437
Loans 90 days past due $ 300 $ 864
Restructured loans $ 7,552 $ 4,901
------------ ------------
Total non performing loans $ 69,769 $ 56,202
Other real estate owned & other assets $ 19,215 $ 22,792
------------ ------------
Total non performing assets $ 88,984 $ 78,994
Problem Loans Still Performing $ 59,076 $ 75,127
------------ ------------
Total Problem Assets $ 148,060 $ 154,121
Net loan charge-offs to average loans 2.57% 0.42%
Allowance for losses to total loans 2.62% 2.35%
Non performing loans to gross loans 7.66% 6.08%
Non performing assets to total assets 6.17% 5.32%
Allowance to non performing loans 34.22% 38.71%
END OF PERIOD BALANCES
Loans and leases $ 910,356 $ 923,919
Total earning assets $ 1,321,006 $ 1,363,015
Total assets $ 1,441,582 $ 1,485,854
Deposits $ 1,039,479 $ 1,066,886
Interest Bearing Liabilities $ 1,189,725 $ 1,232,573
Shareholders' equity $ 110,010 $ 116,096
Total Shares Outstanding 16,187,277 16,178,121
AVERAGE BALANCES
Loans and leases $ 918,513 $ 934,766
Total earning assets $ 1,346,749 $ 1,405,306
Total assets $ 1,452,339 $ 1,513,312
Deposits $ 1,054,447 $ 1,100,982
Interest Bearing Liabilities $ 1,212,880 $ 1,258,040
Shareholders' equity $ 117,677 $ 122,371
Quarterly
-------------------------------------
(dollars in thousands except 2008 2008 2008
per share data) 4th Qtr 3rd Qtr 2nd Qtr
----------- ----------- -----------
EARNINGS
Net interest income $ 9,723 $ 11,086 $ 11,127
FTE Net interest income $ 10,088 $ 11,417 $ 11,463
Provision for loan and lease
losses $ 10,000 $ 4,100 $ 2,700
Non-interest income $ 3,900 $ 4,265 $ 3,858
Non-interest expense $ 8,773 $ 11,365 $ 10,163
Net income (loss) $ (2,997) $ 324 $ 1,718
Basic earnings (loss) per
share $ (0.19) $ 0.02 $ 0.11
Diluted earnings (loss) per
share $ (0.19) $ 0.02 $ 0.11
Average shares outstanding 16,143,902 16,136,402 16,130,806
Average diluted shares
outstanding 16,154,652 16,147,152 16,148,006
PERFORMANCE RATIOS
Return on average assets -0.77% 0.09% 0.45%
Return on average common
equity -9.78% 1.04% 5.34%
Base Margin 2.65% 3.08% 3.05%
FTE Adjustment 0.10% 0.09% 0.09%
Loan Fees 0.04% 0.07% 0.07%
----------- ----------- -----------
FTE Net Interest Margin 2.79% 3.24% 3.21%
Efficiency ratio 59.11% 56.66% 61.24%
Full-time equivalent
employees 384 366 384
CAPITAL
Average equity to average
assets 7.83% 8.19% 8.42%
Book value per share $ 7.49 $ 7.46 $ 7.52
Cash dividend per share $ 0.09 $ 0.09 $ 0.18
ASSET QUALITY
Loan Charge-Offs $ 10,132 $ 3,954 $ 2,607
Loan Recoveries $ 252 $ 169 $ 317
----------- ----------- -----------
Net Charge-Offs $ 9,880 $ 3,785 $ 2,290
Allowance for loan and lease
losses $ 18,528 $ 18,408 $ 18,093
Nonaccrual Loans $ 47,872 $ 34,892 $ 38,115
Loans 90 days past due $ 93 $ 119 $ 109
Restructured loans $ 5,811 $ 6,685 $ 6,023
----------- ----------- -----------
Total non performing loans $ 53,776 $ 41,696 $ 44,247
Other real estate owned &
other assets $ 19,211 $ 17,893 $ 18,065
----------- ----------- -----------
Total non performing
assets $ 72,987 $ 59,589 $ 62,312
Problem Loans Still
Performing $ 63,935 $ 56,156 $ 41,188
----------- ----------- -----------
Total Problem Assets $ 136,922 $ 115,745 $ 103,500
Net loan charge-offs to
average loans 4.08% 1.54% 0.93%
Allowance for losses to
total loans 1.97% 1.88% 1.83%
Non performing loans to
gross loans 5.71% 4.25% 4.47%
Non performing assets to
total assets 4.67% 3.96% 4.04%
Allowance to non performing
loans 34.45% 44.15% 40.89%
END OF PERIOD BALANCES
Loans and leases $ 941,732 $ 981,038 $ 989,839
Total earning assets $ 1,434,098 $ 1,383,659 $ 1,421,653
Total assets $ 1,562,401 $ 1,505,709 $ 1,542,747
Deposits $ 1,136,078 $ 1,080,194 $ 1,065,770
Interest Bearing Liabilities $ 1,282,993 $ 1,234,705 $ 1,267,718
Shareholders' equity $ 120,977 $ 120,413 $ 121,348
Total Shares Outstanding 16,148,482 16,139,538 16,132,513
AVERAGE BALANCES
Loans and leases $ 963,445 $ 980,466 $ 992,618
Total earning assets $ 1,436,265 $ 1,398,768 $ 1,432,923
Total assets $ 1,557,430 $ 1,505,823 $ 1,536,884
Deposits $ 1,144,238 $ 1,076,734 $ 1,076,046
Interest Bearing Liabilities $ 1,297,202 $ 1,245,873 $ 1,273,052
Shareholders' equity $ 121,969 $ 123,355 $ 129,353
Year to Date
(dollars in thousands except per share- --------------------------
data) 2009 2008
------------ ------------
EARNINGS
Net interest income $ 20,398 $ 21,580
FTE Net interest income $ 21,101 $ 22,247
Provision for loan and lease losses $ 12,200 $ 3,900
Non-interest income $ 6,961 $ 7,820
Non-interest expense $ 26,586 $ 19,861
Net income (loss) $ (6,741) $ 4,365
Basic earnings (loss) per share $ (0.42) $ 0.27
Diluted earnings (loss) per share $ (0.42) $ 0.27
Average shares outstanding 16,174,231 16,125,926
Average diluted shares outstanding 16,184,981 16,140,101
PERFORMANCE RATIOS
Return on average assets -0.92% 0.57%
Return on average common equity -11.33% 6.77%
Base Margin 2.94% 2.95%
FTE Adjustment 0.10% 0.09%
Loan Fees 0.05% 0.07%
------------ ------------
FTE Net Interest Margin 3.09% 3.11%
Efficiency ratio 69.96% 62.83%
Full-time equivalent employees 378 382
CAPITAL
Average equity to average assets 8.09% 8.39%
Book value per share $ 6.83 $ 7.52
Cash dividend per share $ 0.02 $ 0.36
ASSET QUALITY
Loan Charge-Offs $ 7,909 $ 6,562
Loan Recoveries $ 1,056 $ 533
------------ ------------
Net Charge-Offs $ 6,853 $ 6,029
Allowance for loan and lease losses $ 23,875 $ 18,093
Nonaccrual Loans $ 61,917 $ 38,115
Loans 90 days past due $ 300 $ 109
Restructured loans $ 7,552 $ 6,023
------------ ------------
Total non performing loans $ 69,769 $ 44,247
Other real estate owned & other
assets $ 19,215 $ 18,065
------------ ------------
Total non performing assets $ 88,984 $ 62,312
Problem Loans Still Performing $ 59,076 $ 41,188
------------ ------------
Total Problem Assets $ 148,060 $ 103,500
Net loan charge-offs to average loans 1.49% 1.22%
Allowance for losses to total loans 2.62% 1.83%
Non performing loans to gross loans 7.66% 4.47%
Non performing assets to total assets 6.17% 4.04%
Allowance to non performing loans 34.22% 40.89%
END OF PERIOD BALANCES
Loans and leases $ 910,355 $ 989,839
Total earning assets $ 1,321,006 $ 1,421,653
Total assets $ 1,441,582 $ 1,542,747
Deposits $ 1,039,479 $ 1,065,770
Interest Bearing Liabilities $ 1,189,725 $ 1,267,718
Shareholders' equity $ 110,511 $ 121,348
Total Shares Outstanding 16,187,277 16,132,513
AVERAGE BALANCES
Loans and leases $ 926,596 $ 995,339
Total earning assets $ 1,375,868 $ 1,438,445
Total assets $ 1,482,657 $ 1,540,966
Deposits $ 1,077,587 $ 1,092,855
Interest Bearing Liabilities $ 1,235,336 $ 1,278,521
Shareholders' equity $ 120,010 $ 129,264
MBT FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2009 2008
Dollars in thousands (Unaudited)
---------------------------------------------------------------------
Assets
Cash and Cash Equivalents
Cash and due from banks
Non-interest bearing 18,047 24,463
Interest bearing 5,513 26,323
---------------------------------------------------------------------
Total cash and cash equivalents 23,560 50,786
Securities - Held to Maturity 40,578 46,840
Securities - Available for Sale 351,473 406,117
Federal Home Loan Bank stock - at cost 13,086 13,086
Loans held for sale 825 784
Loans - Net 885,656 922,420
Accrued interest receivable and other
assets 46,517 43,973
Bank Owned Life Insurance 47,592 45,488
Premises and Equipment - Net 32,295 32,907
---------------------------------------------------------------------
Total assets $ 1,441,582 $ 1,562,401
---------------------------------------------------------------------
Liabilities
Deposits:
Non-interest bearing $ 128,254 $ 144,585
Interest-bearing 911,225 991,493
---------------------------------------------------------------------
Total deposits 1,039,479 1,136,078
Federal Home Loan Bank advances 248,500 261,500
Repurchase agreements 30,000 30,000
Interest payable and other
liabilities 13,593 13,846
---------------------------------------------------------------------
Total liabilities 1,331,572 1,441,424
---------------------------------------------------------------------
Shareholders' Equity
Common stock (no par value) 496 321
Retained Earnings 115,832 122,896
Accumulated other comprehensive income (6,318) (2,240)
---------------------------------------------------------------------
Total shareholders' equity 110,010 120,977
---------------------------------------------------------------------
Total liabilities and
shareholders' equity $ 1,441,582 $ 1,562,401
---------------------------------------------------------------------
MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Quarter Ended June 30,
Dollars in thousands (except per share data) 2009 2008
---------------------------------------------------------------------
Interest Income
Interest and fees on loans $ 13,165 $ 15,771
Interest on investment securities-
Tax-exempt 865 818
Taxable 3,828 4,798
Interest on balances due from banks 12 --
Interest on federal funds sold -- --
---------------------------------------------------------------------
Total interest income 17,870 21,387
---------------------------------------------------------------------
Interest Expense
Interest on deposits 4,582 6,368
Interest on borrowed funds 3,103 3,892
---------------------------------------------------------------------
Total interest expense 7,685 10,260
---------------------------------------------------------------------
Net Interest Income 10,185 11,127
Provision For Loan Losses 8,000 2,700
---------------------------------------------------------------------
Net Interest Income After
Provision For Loan Losses 2,185 8,427
---------------------------------------------------------------------
Other Income
Income from wealth management services 906 1,119
Service charges and other fees 1,432 1,586
Net gain (loss) on sales of securities 50 23
Origination fees on mortgage loans sold 122 91
Bank Owned Life Insurance income 296 275
Other 824 764
---------------------------------------------------------------------
Total other income 3,630 3,858
---------------------------------------------------------------------
Other Expenses
Salaries and employee benefits 5,400 5,441
Occupancy expense 727 916
Equipment expense 771 848
Marketing expense 279 356
Professional fees 409 455
Collection expense 101 95
Net loss on other real estate owned 4,174 354
Other real estate owned expense 467 432
FDIC deposit insurance assessment 1,250 136
Other 1,011 1,130
---------------------------------------------------------------------
Total other expenses 14,589 10,163
---------------------------------------------------------------------
Income (Loss) Before Income Taxes (8,774) 2,122
Income Tax Expense (Benefit) (3,401) 404
---------------------------------------------------------------------
Net Income (Loss) $ (5,373) $ 1,718
---------------------------------------------------------------------
Basic Earnings (Loss) Per Common Share $ (0.33) $ 0.11
---------------------------------------------------------------------
Diluted Earnings (Loss) Per Common Share $ (0.33) $ 0.11
---------------------------------------------------------------------
Dividends Declared Per Common Share $ 0.01 $ 0.18
---------------------------------------------------------------------
MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Six Months Ended
June 30,
Dollars in thousands (except per share data) 2009 2008
---------------------------------------------------------------------
Interest Income
Interest and fees on loans $ 26,765 $ 32,199
Interest on investment securities-
Tax-exempt 1,742 1,633
Taxable 8,328 9,754
Interest on balances due from banks 27 --
Interest on federal funds sold -- 1
---------------------------------------------------------------------
Total interest income 36,862 43,587
---------------------------------------------------------------------
Interest Expense
Interest on deposits 10,106 13,859
Interest on borrowed funds 6,358 8,148
---------------------------------------------------------------------
Total interest expense 16,464 22,007
---------------------------------------------------------------------
Net Interest Income 20,398 21,580
Provision For Loan Losses 12,200 3,900
---------------------------------------------------------------------
Net Interest Income After
Provision For Loan Losses 8,198 17,680
---------------------------------------------------------------------
Other Income
Income from trust services 1,820 2,246
Service charges and other fees 2,788 3,112
Net gain (loss) on sales of securities 656 48
Other Than Temporary Impairment on securities (6,400) --
Portion of OTTI loss recognized in other
comprehensive income (before taxes) 5,631 --
Origination fees on mortgage loans sold 231 284
Bank Owned Life Insurance income 665 630
Other 1,570 1,500
---------------------------------------------------------------------
Total other income 6,961 7,820
---------------------------------------------------------------------
Other Expenses
Salaries and employee benefits 10,834 11,023
Occupancy expense 1,641 1,911
Equipment expense 1,619 1,676
Marketing expense 521 597
Professional fees 867 924
Collection expense 564 427
Net loss on other real estate owned 6,030 389
Other real estate owned expense 766 588
FDIC deposit insurance assessment 1,686 168
Other 2,058 2,158
---------------------------------------------------------------------
Total other expenses 26,586 19,861
---------------------------------------------------------------------
Income (Loss) Before Income Taxes (11,427) 5,639
Income Tax Expense (Benefit) (4,687) 1,274
---------------------------------------------------------------------
Net Income $ (6,740) $ 4,365
---------------------------------------------------------------------
Basic Earnings Per Common Share $ (0.42) $ 0.27
---------------------------------------------------------------------
Diluted Earnings Per Common Share $ (0.42) $ 0.27
---------------------------------------------------------------------
Dividends Declared Per Common Share $ 0.02 $ 0.36
---------------------------------------------------------------------
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: MBT Financial Corp.
MBT Financial Corp.
H. Douglas Chaffin, Chief Executive Officer
(734) 384-8123
doug.chaffin@mbandt.com
John L. Skibski, Chief Financial Officer
(734) 242-1879
john.skibski@mbandt.com
Mary Jane Town, Marketing Officer
(734) 240-2510
maryjane.town@mbandt.com
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