ICBK County Bancorp Inc

Highlights

County Bancorp, Inc. (the “Company”; Nasdaq: ICBK), the holding company of Investors Community Bank (the “Bank”), an agricultural and commercial community bank headquartered in Manitowoc, Wisconsin, reported net income of $3.8 million, or $0.54 diluted earnings per share, for the first quarter of 2019, compared to net income of $2.8 million, or $0.40 diluted earnings per share, for the fourth quarter of 2018 and $4.1 million, or $0.58 diluted earnings per share, for the first quarter of 2018.  This represents an annualized return on average assets of 1.00% for the three months ended March 31, 2019, compared to 1.15% for the three months ended March 31, 2018.

“We are very pleased that we continue to produce solid quarterly earnings, even with the challenges in the dairy sector,” stated Tim Schneider, President of the Company and CEO of the Bank. 

“As we previously announced, we are committed to reducing our wholesale funding which we were able to make significant progress towards in the first quarter through loan participations.  Our core deposit strategies had modest impact on this shift in the first quarter, but we feel longer term our strategies to grow core deposits will be impactful.  Although we saw reduction in our classified assets ratio which was due to completed collection efforts, loan payoffs, and credits which were upgraded through our annual review process, we still have a large portion of our agricultural portfolio remaining to fully review through the credit underwriting process.”

Loans and Total Assets

Total assets at March 31, 2019 were $1.5 billion, a decrease of $29.4 million, or 1.9%, and an increase of $31.1 million, or 2.1%, over total assets as of December 31, 2018 and March 31, 2018, respectively.  Total loans were $1.2 billion at March 31, 2019, which represents a $24.3 million, or 2.0%, decrease over total loans at December 31, 2018, and an $18.4 million, or 1.6%, increase over total loans at March 31, 2018.

During the first quarter of 2019, participated loans that we continue to service increased to $675.3 million at March 31, 2019, which is an increase of $14.0 million, or 2.1%, and $63.9 million, or 10.5%, over participated loans that we serviced at December 31, 2018 and March 31, 2018, respectively.

Deposits

Total deposits at March 31, 2019 were $1.2 billion, a decrease of $47.1 million, or 3.8%, and an increase of $3.8 million, or 0.3%, over total deposits as of December 31, 2018 and March 31, 2018, respectively.  Client deposits (demand deposits, money market accounts, and certificates of deposit) increased $5.2 million, or 0.7%, since December 31, 2018, and increased $89.4 million, or 13.3%, since March 31, 2018. 

Due to the increases in loan participations and client deposit growth, we were able to decrease our reliance on brokered deposits and national certificates of deposit by $52.2 million, or 11.1%, from December 31, 2018, to $416.7 million at March 31, 2019.  This also represents a decrease or $85.5 million, or 17.0%, from March 31, 2018. 

During the first quarter of 2019, we supplemented a portion of our deposit needs with FHLB borrowings.  At March 31, 2019, borrowings from the FHLB totaled $100.4 million, which was an increase of $11.0 million, or 12.3%, from December 31, 2018, but was a decrease of $20.1 million, or 16.7%, from March 31, 2018.

Net Interest Income and Margin

Net interest income was $10.6 million for the three months ended March 31, 2019, which was a $0.1 million, or 1.7%, decrease from the three months ended December 31, 2018, and a $0.3 million, or 2.8%, increase from the three months ended March 31, 2018.  The primary reason for the first quarter decline in net interest income compared to the preceding quarter was the increase in loan participations that resulted in lower average loan balances during the period.

Net interest margin was 2.94% for the three months ended March 31, 2019, which was an increase from 2.91% for the three months ended December 31, 2018, and a decrease from 3.01% for the three months ended March 31, 2018.  A slight improvement in net interest margin was realized over the linked quarter because while loan yields remained steady, interest rates on deposits due from other banks outpaced the increase in cost of funds.  Year-over-year first quarter net interest margin decreased by seven basis points primarily due to interest expense related to the $30.0 million of junior subordinated debentures that were issued during the second quarter of 2018 and a fifty-one basis point increase in cost of funds, which was partially offset by a forty-seven basis point improvement in loan yields.

Non-Interest Income and Expense

Non-interest income for the three months ended March 31, 2019 increased by $0.5 million, or 18.5%, to $2.8 million compared to the three months ended December 31, 2018, primarily due to the reduction of the allowance for unused commitments of $0.5 million, included in other non-interest income, in the first quarter.  The Company evaluated the need for this allowance during the first quarter and concluded there was no sufficient evidence that represented credit loss inherent in these commitments to substantiate the necessity of this reserve at March 31, 2019 and concluded to eliminate it.  The Company will continue to evaluate credit risk on these off-balance sheet commitments going forward.  During the first quarter, the Company also reduced a valuation allowance on its loan servicing rights portfolio which resulted in an increase of $0.2 million of loan servicing rights.  The reduction of the valuation allowance is expected to continue throughout the remaining quarters of 2019.

Non-interest income for the three months ended March 31, 2019 increased $0.7 million, or 34.8%, compared to $2.0 million for the three months ended March 31, 2018.  The year-over-year increase was primarily due to the elimination of the allowance for unused commitments and valuation allowance reduction discussed above and increases in loan servicing fees and rights which were the result of higher volumes of loans being serviced.

Non-interest expense for the three months ended March 31, 2019 decreased by $0.2 million, or 3.1%, to $7.3 million compared to the three months ended December 31, 2018, and increased $0.5 million, or 7.7%, compared to the three months ended March 31, 2018.  The quarter-over-quarter decrease was primarily due $0.7 million of write-downs on two OREO properties that took place during the fourth quarter of 2018, which was partially offset by a $0.3 million, or 6.3% increase in employee compensation and benefits which was primarily the result of a 24.1% increase in the premium cost of employee benefits.

Asset Quality

Non-performing assets as a percent of total assets increased to 2.07% at March 31, 2019, from 1.94% at December 31, 2018, and 1.83% at March 31, 2018.  At March 31, 2019, non-performing assets were $30.9 million, an increase of $1.3 million and $4.2 million at December 31, 2018 and March 31, 2018, respectively.  During the first quarter of 2019, non-performing loans increased by $2.9 million; however, three OREO properties were sold resulting in a decrease of $1.5 million in OREO during the quarter ended March 31, 2019.

Substandard loans were $107.5 million at March 31, 2019, compared to $120.9 million at December 31, 2018 and $82.6 million at March 31, 2018.  Adverse classified asset ratio (a non-GAAP measure) decreased to 48.59% at March 31, 2019 from 57.12% and 53.44% at December 31, 2018 and March 31, 2018, respectively.  Despite Wisconsin’s strained agricultural economy and the four-year sustained low prices of class III milk, the improvement in this ratio is the result of the active management of the substandard credits within the Bank’s loan portfolio as well as sales of OREO during the quarter.

A provision for loan losses of $0.8 million was recorded for the three months ended March 31, 2019 compared to a provision of $1.6 million and $0.1 million for the three months ended December 31, 2018 and March 31, 2018, respectively.  The decrease in provision in the linked quarter is directly related to the $24.3 million reduction in total loans and the $0.2 million of net recoveries that occurred during the first quarter of 2019.

The allowance for loan losses was $17.5 million at March 31, 2019 compared to $16.5 million at December 31, 2018.  The $1.0 million increase in the allowance during the first quarter of 2019 was the result of a $2.1 million increase in specific impairments on substandard loans which was offset in part by a $1.1 million reduction in general reserves due to the decreases in both adversely classified and total loans and improvement of qualitative factors.

Conference Call

The Company will host an earnings call today, April 18, 2019, at 1:30 p.m., CDT, conducted by Tim Schneider, President, and Glen L. Stiteley, CFO.  The earnings call will be broadcast over the Internet on the Company’s website at www.ICBK.com then clicking on the link “Investor Relations,” and selecting “News”, then “Event Calendar.”  In addition, you may listen to the Company’s earnings call via telephone by dialing (888) 317-6016.  Investors should visit the Company’s website or call in to the dial-in number set forth above at least 10 minutes prior to the scheduled start of the call.  

A replay of the earnings call will be available until April 18, 2020, by visiting the Company’s website at http://www.icbk.com  and clicking on the link “Investor Relations.”

About County Bancorp, Inc.

County Bancorp, Inc., a Wisconsin corporation and registered bank holding company founded in May 1996, and our wholly-owned subsidiary Investors Community Bank, a Wisconsin-chartered bank, are headquartered in Manitowoc, Wisconsin.  The state of Wisconsin is often referred to as “America’s Dairyland,” and one of the niches we have developed is providing financial services to agricultural businesses statewide, with a primary focus on dairy-related lending.  We also serve business and retail customers throughout Wisconsin, with a focus on northeastern and central Wisconsin.  Our customers are served from our full-service locations in Manitowoc, Appleton, Green Bay, and Stevens Point and our loan production offices in Darlington, Eau Claire, Fond du Lac, and Sheboygan.

Forward-Looking Statements

This press release includes "forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking statements presented in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release.  Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "plan," "seek," "will," "expect," "intend," "estimate," "anticipate," "believe" or "continue" or the negative thereof or variations thereon or similar terminology. Factors that may cause actual results to differ materially from those made or suggested by the forward-looking statements contained in this press release include those identified in the Company’s most recent annual report on Form 10-K and subsequent filings with the Securities and Exchange Commission.  Any forward-looking statements presented herein are made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Investor Relations ContactGlen L. StiteleyEVP - CFO, Investors Community BankPhone: (920) 686-5658 Email: gstiteley@icbk.com     

County Bancorp, Inc.Consolidated Financial Summary(Unaudited)		March 31,2019				December 31,2018				September 30,2018				June 30,2018				March 31,2018
		(dollars in thousands, except per share data)
Period-End Balance Sheet:
Assets
Cash and cash equivalents		$	62,426			$	61,087			$	49,996			$	81,044			$	90,676
Securities available for sale, at fair value			192,210				195,945				190,185				187,505				141,360
Loans held for sale			2,998				2,949				13,770				11,468				6,407
Agricultural loans			722,107				724,508				714,310				702,426				698,106
Commercial loans			403,490				415,672				417,146				407,609				406,096
Multi-family real estate loans			52,974				62,321				66,403				65,713				54,514
Residential real estate loans			4,172				4,522				4,965				5,437				5,512
Installment and consumer other			220				272				113				339				297
Total loans			1,182,963				1,207,295				1,202,937				1,181,524				1,164,525
Allowance for loan losses			(17,493	)			(16,505	)			(16,143	)			(15,129	)			(14,612	)
Net loans			1,165,470				1,190,790				1,186,794				1,166,395				1,149,913
Other assets			68,284				70,057				74,223				72,465				71,901
Total Assets		$	1,491,388			$	1,520,828			$	1,514,968			$	1,518,877			$	1,460,257
Liabilities and Shareholders' Equity
Demand deposits		$	101,434			$	121,436			$	103,862			$	95,459			$	101,167
NOW accounts and interest checking			49,902				51,779				46,811				51,674				48,212
Savings			6,210				5,770				6,616				6,833				6,189
Money market accounts			225,975				218,929				208,233				204,332				199,834
Time deposits			376,034				356,484				352,531				344,619				314,766
Brokered deposits			269,917				308,504				317,291				323,561				319,692
National time deposits			146,805				160,445				173,440				183,953				182,530
Total deposits			1,176,277				1,223,347				1,208,784				1,210,431				1,172,390
FHLB advances			100,400				89,400				102,400				108,200				120,500
Subordinated debentures			44,742				44,703				44,663				44,725				15,540
Other liabilities			11,952				11,293				11,134				9,439				9,013
Total Liabilities			1,333,371				1,368,743				1,366,981				1,372,795				1,317,443
Shareholders' equity			158,017				152,085				147,987				146,082				142,814
Total Liabilities and Shareholders'  Equity		$	1,491,388			$	1,520,828			$	1,514,968			$	1,518,877			$	1,460,257
Stock Price Information:
High - Quarter-to-date		$	19.69			$	26.00			$	28.20			$	29.26			$	33.76
Low - Quarter-to-date		$	16.74			$	17.37			$	24.29			$	25.72			$	26.61
Market price - Quarter-end		$	17.60			$	17.37			$	25.10			$	27.50			$	29.21
Book value per share		$	22.36			$	21.50			$	20.91			$	20.63			$	20.17
Tangible book value per share (1)		$	21.54			$	20.65			$	20.07			$	19.77			$	19.29
Common shares outstanding			6,709,254				6,709,480				6,694,230				6,693,447				6,684,923

(1) This is a non-GAAP financial measure.  A reconciliation to GAAP is included below.

		March 31,2019				December 31,2018				September 30,2018				June 30,2018				March 31,2018
		(dollars in thousands)
Loans by risk category:
Sound/Acceptable/Satisfactory/  Low Satisfactory		$	896,328			$	908,172			$	901,643			$	896,509			$	891,062
Watch			174,642				171,670				171,890				186,399				185,179
Special Mention			4,501				6,566				11,036				4,783				5,636
Substandard Performing			46,075				65,501				61,851				46,751				45,261
Substandard Impaired			61,417				55,386				56,517				47,082				37,387
Total loans			1,182,963				1,207,295				1,202,937				1,181,524				1,164,525
Loan sold with servicing retained			675,268				661,257				644,879				628,435				611,358
Total loans and loans sold with  servicing retained		$	1,858,231			$	1,868,552			$	1,847,816			$	1,809,959			$	1,775,883
Non-Performing Assets:
Nonaccrual loans		$	25,880			$	22,983			$	27,881			$	26,305			$	17,746
Other real estate owned (2)			5,019				6,568				7,851				8,607				8,982
Total non-performing assets		$	30,899			$	29,551			$	35,732			$	34,912			$	26,728
Performing TDRs not on nonaccrual		$	21,111			$	18,258			$	11,863			$	11,173			$	10,488
Non-performing assets as a % of total loans			2.61	%			2.45	%			2.97	%			2.95	%			2.30	%
Non-performing assets as a % of total assets			2.07	%			1.94	%			2.36	%			2.30	%			1.83	%
Adverse classified asset ratio (1)			48.59	%			57.12	%			51.89	%			47.34	%			53.44	%
Allowance for loan losses as a % of  nonaccrual loans			67.59	%			71.81	%			57.90	%			57.51	%			82.34	%
Allowance for loan losses as a % of total  loans			1.48	%			1.37	%			1.34	%			1.28	%			1.25	%
Net charge-offs (recoveries) quarter-to-date		$	(236	)		$	1,210			$	(21	)		$	16			$	(1,268	)
Provision for loan loss quarter-to-date		$	752			$	1,572			$	993			$	533			$	97

(1) This is a non-GAAP financial measure.  A reconciliation to GAAP is included below. (2) For the quarters ending March 31, 2018 through September 30, 2018, does not include $0.4 million of bank property transferred from premises and equipment, which is not considered a non-performing asset.  As of March 31, 2019 and December 31, 2018, that bank property is considered classified due to the length of the holding period.

		For the Three Months Ended
		March 31,2019				December 31,2018				September 30,2018				June 30,2018				March 31,2018
		(dollars in thousands, except per share data)
Selected Income Statement Data:
Interest and Dividend Income
Loans, including fees		$	15,501			$	15,536			$	15,113			$	14,366			$	13,691
Taxable securities			1,186				1,168				945				982				632
Tax-exempt securities			175				183				344				14				157
Federal funds sold and other			264				223				249				401				213
Total interest and dividend  income			17,126				17,110				16,651				15,763				14,693
Interest Expense
Deposits			5,424				5,273				4,980				4,600				3,796
FHLB advances and other borrowed  funds			464				427				411				487				484
Subordinated debentures			678				667				656				338				143
Total interest expense			6,566				6,367				6,047				5,425				4,423
Net interest income			10,560				10,743				10,604				10,338				10,270
Provision for loan losses			752				1,572				993				533				97
Net interest income after provision  for loan losses			9,808				9,171				9,611				9,805				10,173
Non-Interest Income
Services charges			353				470				394				445				365
Gain (loss) on sale of loans, net			(1	)			54				41				45				32
Loan servicing fees			1,519				1,553				1,521				1,486				1,452
Loan servicing right origination			228				7				(46	)			127				10
Income on OREO			26				83				96				45				32
Other			625				153				151				168				149
Total non-interest income			2,750				2,320				2,157				2,316				2,040
Non-Interest Expense
Employee compensation and  benefits			4,482				4,059				4,394				4,114				4,218
Occupancy			389				245				332				278				204
Information processing			563				641				529				529				465
Professional fees			399				497				351				359				315
Business development			325				259				258				260				299
OREO expenses			51				106				46				152				140
Writedown of OREO			-				688				81				104				-
Net gain on sale of OREO			(136	)			(54	)			(28	)			(149	)			-
Depreciation and amortization			337				408				302				324				314
Other			895				689				758				966				830
Total non-interest expense			7,305				7,538				7,023				6,937				6,785
Income before income taxes			5,253				3,953				4,745				5,184				5,428
Income tax expense			1,491				1,123				1,228				1,334				1,374
NET INCOME		$	3,762			$	2,830			$	3,517			$	3,850			$	4,054
Basic		$	0.54			$	0.41			$	0.51			$	0.56			$	0.59
Diluted		$	0.54			$	0.40			$	0.50			$	0.55			$	0.58
Dividends declared		$	0.05			$	0.07			$	0.07			$	0.07			$	0.07

		For the Three Months Ended
		March 31,2019				December 31,2018				September 30,2018				June 30,2018				March 31,2018
		(dollars in thousands, except share data)
Other Data:
Return on average assets			1.00	%			0.75	%			0.94	%			1.04	%			1.15	%
Return on average shareholders'  equity			9.78	%			7.58	%			9.51	%			10.63	%			11.62	%
Return on average common  shareholders' equity (1)			9.99	%			7.70	%			9.75	%			10.96	%			12.04	%
Efficiency ratio (1)			55.91	%			52.85	%			54.62	%			55.18	%			55.12	%
Tangible common equity to  tangible assets (1)			9.73	%			9.14	%			8.90	%			8.75	%			8.87	%
Common Share Data:
Net income from continuing  operations		$	3,762			$	2,830			$	3,517			$	3,850			$	4,054
Less:  Preferred stock dividends			117				111				106				99				97
Income available to common  shareholders		$	3,645			$	2,719			$	3,411			$	3,751			$	3,957
Weighted average number of common  shares issued			7,188,817				7,184,946				7,167,276				7,163,362				7,152,970
Less: Weighted average treasury  shares			443,729				443,694				443,140				442,102				439,833
Less: Weighted average non-  vested restricted units  awards			19,383				28,701				29,537				30,692				34,976
Weighted average number of  common shares outstanding			6,725,705				6,712,551				6,694,599				6,690,568				6,678,161
Effect of dilutive options			21,323				45,116				63,346				79,368				90,804
Weighted average number of  common shares outstanding  used to calculate diluted  earnings per common share			6,747,028				6,757,667				6,757,945				6,769,936				6,768,965

(1) This is a non-GAAP financial measure.  A reconciliation to GAAP is included below.

		For the Three Months Ended
Non-GAAP Financial Measures:		March 31,2019				December 31,2018				September 30,2018				June 30,2018				March 31,2018
		(dollars in thousands)
Return on average common  shareholders' equity  reconciliation:
Return on average shareholders'  equity			9.78	%			7.58	%			9.51	%			10.63	%			11.62	%
Effect of excluding average  preferred shareholders'  equity			0.21	%			0.12	%			0.24	%			0.33	%			0.42	%
Return on average common  shareholders' equity			9.99	%			7.70	%			9.75	%			10.96	%			12.04	%
Efficiency ratio GAAP to non-GAAP  reconciliation:
Non-interest expense		$	7,305			$	7,538			$	7,023			$	6,937			$	6,785
Less: net gain (loss) on sales and  write-downs of OREO			136				(634	)			(53	)			45				-
Adjusted non-interest expense  (non-GAAP)		$	7,441			$	6,904			$	6,970			$	6,982			$	6,785
Net interest income		$	10,560			$	10,743			$	10,604			$	10,338			$	10,270
Non-interest income			2,750				2,320				2,157				2,316				2,040
Operating revenue		$	13,310			$	13,063			$	12,761			$	12,654			$	12,310
Efficiency ratio			55.91	%			52.85	%			54.62	%			55.18	%			55.12	%

               

		March 31,2019				December 31,2018				September 30,2018				June 30,2018				March 31,2018
		(dollars in thousands, except per share data)
Tangible book value per share and  tangible common equity to tangible  assets reconciliation:
Common equity		$	150,017			$	144,085			$	139,987			$	138,082			$	134,814
Less: Goodwill			5,038				5,038				5,038				5,038				5,038
Less: Core deposit intangible, net of  amortization			430				513				603				701				806
Tangible common equity (non-GAAP)		$	144,549			$	138,534			$	134,346			$	132,343			$	128,970
Common shares outstanding			6,709,254				6,709,480				6,694,230				6,693,447				6,684,923
Tangible book value per share		$	21.54			$	20.65			$	20.07			$	19.77			$	19.29
Total assets		$	1,491,388			$	1,520,828			$	1,514,968			$	1,518,877			$	1,460,257
Less: Goodwill			5,038				5,038				5,038				5,038				5,038
Less: Core deposit intangible, net of  amortization			430				513				603				701				806
Tangible assets (non-GAAP)		$	1,485,920			$	1,515,277			$	1,509,327			$	1,513,138			$	1,454,413
Tangible common equity to tangible assets			9.73	%			9.14	%			8.90	%			8.75	%			8.87	%
Adverse classified asset ratio:
Substandard loans		$	107,492			$	120,887			$	118,368			$	93,833			$	82,648
Less: Impaired performing restructured loans			(6,382	)			(5,078	)			(13,657	)			(2,081	)			(1,164	)
Net substandard loans		$	101,110			$	115,809			$	104,711			$	91,752			$	81,484
Other real estate owned			5,019				6,568				7,851				8,607				8,982
Substandard unused commitments			976				1,625				1,191				959				2,309
Less: Substandard government guarantees			(5,864	)			(7,111	)			(9,374	)			(8,356	)			(3,605	)
Total adverse classified assets (non-GAAP)		$	101,241			$	116,891			$	104,379			$	92,962			$	89,170
Total equity (Bank)		$	191,287			$	185,458			$	180,359			$	177,911			$	149,105
Accumulated other comprehensive loss  (gain) on available for sale securities			(436	)			2,221				4,152				2,795				2,603
Allowance for loan losses			17,493				16,505				16,143				15,129				14,612
Allowance for unused commitments			-				475				510				522				553
Adjusted total equity (non-GAAP)		$	208,344			$	204,659			$	201,164			$	196,357			$	166,873
Adverse classified asset ratio			48.59	%			57.12	%			51.89	%			47.34	%			53.44	%

		For the Three Months Ended
		March 31, 2019												December 31, 2018												March 31, 2018
		AverageBalance (1)				Income/Expense				Yields/Rates				AverageBalance (1)				Income/Expense				Yields/Rates				AverageBalance (1)				Income/Expense				Yields/Rates
		(dollars in thousands)
Assets
Investment securities		$	192,963			$	1,361				2.82	%		$	191,955			$	1,351				2.82	%		$	136,722			$	789				2.31	%
Loans (2)			1,207,240				15,501				5.14	%			1,207,883				15,536				5.14	%			1,172,786				13,691				4.67	%
Interest bearing deposits due from  other banks			36,227				264				2.92	%			67,153				223				1.33	%			55,784				213				1.53	%
Total interest-earning assets		$	1,436,430			$	17,126				4.77	%		$	1,466,991			$	17,110				4.67	%		$	1,365,292			$	14,693				4.30	%
Allowance for loan losses			(17,005	)											(16,034	)											(13,722	)
Other assets			78,654												61,316												62,000
Total assets		$	1,498,079											$	1,512,273											$	1,413,570
Liabilities
Savings, NOW, money market,  interest checking		$	295,418			$	1,184				1.60	%		$	287,420			$	1,043				1.45	%		$	282,313			$	640				0.91	%
Time deposits			797,476				4,240				2.13	%			820,515				4,230				2.06	%			742,465				3,156				1.70	%
Total interest-bearing deposits		$	1,092,894			$	5,424				1.99	%		$	1,107,935			$	5,273				1.90	%		$	1,024,778			$	3,796				1.48	%
Other borrowings			844				11				5.27	%			837				10				4.62	%			1,286				16				4.97	%
FHLB advances			92,900				453				1.95	%			90,509				417				1.84	%			121,067				468				1.55	%
Junior subordinated debentures			44,606				678				6.08	%			44,681				667				5.97	%			15,529				143				3.68	%
Total interest-bearing  liabilities		$	1,231,244			$	6,566				2.13	%		$	1,243,962			$	6,367				2.05	%		$	1,162,660			$	4,423				1.52	%
Non-interest-bearing deposits			101,532												108,140												103,669
Other liabilities			11,362												10,913												7,743
Total liabilities		$	1,344,138											$	1,363,015											$	1,274,072
Shareholders' equity			153,941												149,258												139,498
Total liabilities and equity		$	1,498,079											$	1,512,273											$	1,413,570
Net interest income						$	10,560											$	10,743											$	10,270
Interest rate spread (3)											2.64	%											2.62	%											2.78	%
Net interest margin (4)											2.94	%											2.91	%											3.01	%
Ratio of interest-earning assets to  interest-bearing liabilities			1.17												1.18												1.17

(1) Average balances are calculated on amortized cost. (2) Includes loan fee income, nonaccruing loan balances, and interest received on such loans. (3) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities. (4) Net interest margin represents net interest income divided by average total interest-earning assets.