GREEN BAY, Wis.--(BUSINESS WIRE)--Jan. 22, 2004--Associated
Banc-Corp (Nasdaq:ASBC) reported earnings of $3.07 per diluted share
for 2003, up 10.0 percent from 2002. Net income for 2003 was $228.7
million, compared to $210.7 million for 2002.
Net income for the fourth quarter of 2003 was $55.6 million, or 75
cents per diluted share, compared to $53.4 million, or 71 cents per
diluted share, in the fourth quarter of 2002.
Return on average assets (ROA) and equity (ROE) for 2003 were 1.53
percent and 17.58 percent, respectively. This compares to ROA of 1.47
percent and ROE of 17.10 percent in 2002. Book value per share rose to
$18.39 as of Dec. 31, 2003, up 7.4 percent compared to a year earlier.
"We are pleased to have reached our earnings growth goal of 10
percent in 2003. While commercial loan demand was lower than
anticipated, we experienced strong growth in our mortgage business and
in consumer deposits which contributed to our solid performance," said
Paul Beideman, president and CEO of Associated Banc-Corp.
Associated's net interest income rose to $510.8 million for the
year, compared to $501.3 million in 2002, an increase of 1.9 percent.
This increase was the net result of a 5 percent increase in average
earning assets and an 11 basis point decline in net interest margin.
Net interest margin was 3.84 percent for 2003, compared to 3.95
percent in 2002. Average loan growth was 6 percent, led by commercial
loans which grew 9 percent between the years. Average deposits
excluding time deposits increased 12 percent, with total average
deposits up 4 percent.
Net interest income was down slightly to $127.1 million for the
fourth quarter of 2003 compared to $129.0 million for the third
quarter. The fourth quarter's margin was 3.81 percent, up from 3.78
percent in the third quarter, benefiting primarily from continued
lower cost of deposits.
Noninterest income rose to $252.5 million in 2003, up 14.6 percent
from $220.3 million in 2002. Growth in noninterest income was led by
strong mortgage banking performance in 2003. Mortgage banking income
for the year was $89.1 million, compared to $70.9 million in 2002.
Secondary mortgage production in 2003 was $4.3 billion, up 34 percent
compared to 2002. Additionally, retail commissions on investment
brokerage and insurance services grew 40.0 percent to $25.6 million,
including the contribution of CFG Insurance Services, Inc., an
insurance agency Associated acquired in April 2003. Service charges on
deposit accounts grew 9.3 percent to $50.3 million, in line with the
growth in deposits. Trust service fees grew 6.1 percent to $29.6
million for the year. Fees from credit cards and other nondeposit fees
declined 13.9 percent to $23.7 million, primarily due to the sale of
the company's merchant card processing business in March of 2003.
Noninterest income for fourth quarter 2003 of $53.3 million was
down $10.6 million or 16.6 percent compared to third quarter. The
sequential quarter decline reflects the impact of the slowdown
throughout the industry in residential mortgage and refinance markets.
Mortgage banking income was down $13.1 million from the third to the
fourth quarters.
Noninterest expenses remained well controlled, rising $20.2
million or 5.4 percent year-over-year to $394.8 million. Personnel
expense was principally accountable for the increase in noninterest
expense, rising $20.4 million or 10.6 percent year-over-year, to
$213.4 million, primarily due to the timing of the 2002 Signal
Financial Corp and 2003 CFG acquisitions and higher costs related to
mortgage activity.
From the third quarter to the fourth quarter of 2003, noninterest
expense declined $2.9 million, or 2.9 percent, to $94.9 million. The
sequential quarter decline reflects a reduction in mortgage servicing
rights expense of $3.5 million, attributable to the partial recovery
of valuation reserve on mortgage servicing rights. The change in the
mortgage servicing rights valuation reserve reflects the slight rise
in market interest rates in the fourth quarter 2003 and the slower
prepayment speeds in the portfolio of mortgage loans serviced for
others.
In 2003 net charge-offs were 0.30 percent of average loans,
compared to 0.28 percent in 2002. Nonperforming loans were 1.18
percent of total loans at year-end 2003, compared to 0.96 percent a
year ago. The provision for loan losses in 2003 was $46.8 million,
compared to $50.7 million in 2002. The allowance for loan losses
increased to $177.6 million (or 1.73 percent of total loans) from
$162.5 million (or 1.58 percent of total loans) at the end of 2002.
"Our long-term goal of achieving 10 percent annual
earnings-per-share growth remains unchanged. In 2004, to replace
reduced mortgage revenue, we expect growth from more diverse revenue
sources, including consumer banking, small business banking and wealth
management, as well as the traditional commercial business," Beideman
said.
"Our management team has worked hard to mitigate problem credits
in 2003. As a result, we anticipate overall asset quality to improve.
"We are comfortable with the 2004 consensus earnings estimate of
$3.25 per share. We expect to exceed that consensus if economic
conditions continue to improve and as we gain traction from our new
initiatives," he said.
The company paid dividends of $1.33 in 2003, up from $1.21 in
2002, making 2003 Associated's 33rd consecutive year of increasing
dividends.
Associated repurchased approximately 2.1 million shares of its
common stock in 2003 at an average cost of $36.17 per share. The
company starts 2004 with authorizations to repurchase approximately
3.7 million shares.
Associated Banc-Corp, headquartered in Green Bay, Wis., is a
diversified multibank holding company with total assets of $15.2
billion. Associated has more than 200 banking offices serving more
than 150 communities in Wisconsin, Illinois, and Minnesota. The
company offers a full range of traditional banking services and a
variety of other financial products and services. More information
about Associated Banc-Corp is available at www.AssociatedBank.com.
---------------------------------------------------------------------
Consolidated Balance Sheets (Unaudited)
Associated Banc-CorpDecember 31, December 31,
(in thousands) 2003 2002 % Change
---------------------------------------------------------------------
Assets
Cash and due from banks $389,140 $430,691 (9.6%)
Interest-bearing deposits in other
financial institutions 7,434 5,502 35.1%
Federal funds sold and securities
purchased
under agreements to resell 3,290 8,820 (62.7%)
Securities available for sale, at
fair value 3,773,784 3,362,669 12.2%
Loans held for sale 104,336 305,836 (65.9%)
Loans 10,291,810 10,303,225 (0.1%)
Allowance for loan losses (177,622) (162,541) 9.3%
------------ ------------
Loans, net 10,114,188 10,140,684 (0.3%)
Premises and equipment 131,315 132,713 (1.1%)
Goodwill 224,388 212,112 5.8%
Other intangible assets 63,509 41,565 52.8%
Other assets 436,510 402,683 8.4%
------------ ------------
Total assets $15,247,894 $15,043,275 1.4%
============ ============
Liabilities and Stockholders' Equity
Noninterest-bearing deposits $1,814,446 $1,773,699 2.3%
Interest-bearing deposits,
excluding Brokered CDs 7,813,267 7,117,503 9.8%
Brokered CDs 165,130 233,650 (29.3%)
------------ ------------
Total deposits 9,792,843 9,124,852 7.3%
Short-term borrowings 1,928,876 2,389,607 (19.3%)
Long-term debt 1,852,219 1,906,845 (2.9%)
Company-obligated mandatorily
redeemable
preferred securities 181,941 190,111 (4.3%)
Accrued expenses and other
liabilities 143,588 159,677 (10.1%)
------------ ------------
Total liabilities 13,899,467 13,771,092 0.9%
Stockholders' Equity
Preferred stock - -
Common stock 734 755 (2.8%)
Surplus 575,975 643,956 (10.6%)
Retained earnings 724,356 607,944 19.1%
Accumulated other comprehensive
income 52,089 60,313 (13.6%)
Deferred compensation (1,981) - N/M
Treasury stock, at cost (2,746) (40,785) (93.3%)
------------ ------------
Total stockholders' equity 1,348,427 1,272,183 6.0%
------------ ------------
Total liabilities and
stockholders' equity $15,247,894 $15,043,275 1.4%
============ ============
N/M - Not meaningful.
---------------------------------------------------------------------
Consolidated Statements of Income (Unaudited)
Associated Banc-Corp
For The Three
Months Ended,
December 31,
-------------------
(in thousands, except per share amounts) 2003 2002 % Change
---------------------------------------------------------------------
Interest Income
Interest and fees on loans $137,289 $157,822 (13.0%)
Interest and dividends on investment
securities
and deposits with other financial
institutions
Taxable 29,194 28,419 2.7%
Tax-exempt 9,939 9,887 0.5%
Interest on federal funds sold and
securities
purchased under agreements to resell 36 50 (28.0%)
--------- ---------
Total interest income 176,458 196,178 (10.1%)
Interest Expense
Interest on deposits 29,247 35,896 (18.5%)
Interest on short-term borrowings 5,390 10,838 (50.3%)
Interest on long-term debt and capital
securities 14,684 19,731 (25.6%)
--------- ---------
Total interest expense 49,321 66,465 (25.8%)
--------- ---------
Net Interest Income 127,137 129,713 (2.0%)
Provision for loan losses 9,603 14,614 (34.3%)
--------- ---------
Net interest income after provision for
loan losses 117,534 115,099 2.1%
Noninterest Income
Trust service fees 8,150 6,060 34.5%
Service charges on deposit accounts 12,735 12,185 4.5%
Mortgage banking 10,545 28,194 (62.6%)
Credit card and other nondeposit fees 5,646 7,281 (22.5%)
Retail commissions 8,031 4,128 94.5%
Bank owned life insurance income 3,417 3,557 (3.9%)
Asset sale gains (losses), net 1,366 (373) (466.2%)
Investment securities gains (losses),
net - (801) N/M
Other 3,379 4,118 (17.9%)
--------- ---------
Total noninterest income 53,269 64,349 (17.2%)
Noninterest Expense
Personnel expense 55,083 51,579 6.8%
Occupancy 6,710 6,709 0.0%
Equipment 3,206 3,709 (13.6%)
Data processing 5,731 5,497 4.3%
Business development and advertising 4,165 3,512 18.6%
Stationery and supplies 1,741 1,819 (4.3%)
FDIC expense 350 375 (6.7%)
Mortgage servicing rights expense 735 10,330 (92.9%)
Other intangible amortization 870 609 42.9%
Loan expense 1,446 4,275 (66.2%)
Other 14,875 14,349 3.7%
--------- ---------
Total noninterest expense 94,912 102,763 (7.6%)
--------- ---------
Income before income taxes 75,891 76,685 (1.0%)
Income tax expense 20,282 23,244 (12.7%)
--------- ---------
Net Income $55,609 $53,441 4.1%
========= =========
Earnings Per Share:
Basic $0.76 $0.72 5.6%
Diluted $0.75 $0.71 5.6%
Average Shares Outstanding:
Basic 73,310 74,497 (1.6%)
Diluted 74,332 75,202 (1.2%)
Consolidated Statements of Income (Unaudited)
Associated Banc-Corp
For The Year Ended,
December 31,
-------------------
(in thousands, except per share amounts) 2003 2002 % Change
---------------------------------------------------------------------
Interest Income
Interest and fees on loans $578,816 $626,378 (7.6%)
Interest and dividends on investment
securities
and deposits with other financial
institutions
Taxable 108,624 125,568 (13.5%)
Tax-exempt 39,761 39,771 (0.0%)
Interest on federal funds sold and
securities
purchased under agreements to resell 163 389 (58.1%)
--------- ---------
Total interest income 727,364 792,106 (8.2%)
Interest Expense
Interest on deposits 123,122 169,021 (27.2%)
Interest on short-term borrowings 29,156 51,372 (43.2%)
Interest on long-term debt and capital
securities 64,324 70,447 (8.7%)
--------- ---------
Total interest expense 216,602 290,840 (25.5%)
--------- ---------
Net Interest Income 510,762 501,266 1.9%
Provision for loan losses 46,813 50,699 (7.7%)
--------- ---------
Net interest income after provision for
loan losses 463,949 450,567 3.0%
Noninterest Income
Trust service fees 29,577 27,875 6.1%
Service charges on deposit accounts 50,346 46,059 9.3%
Mortgage banking 89,128 70,903 25.7%
Credit card and other nondeposit fees 23,669 27,492 (13.9%)
Retail commissions 25,571 18,264 40.0%
Bank owned life insurance income 13,790 13,841 (0.4%)
Asset sale gains (losses), net 1,569 657 138.8%
Investment securities gains (losses),
net 702 (427) (264.4%)
Other 18,174 15,644 16.2%
--------- ---------
Total noninterest income 252,526 220,308 14.6%
Noninterest Expense
Personnel expense 213,358 192,918 10.6%
Occupancy 28,077 26,049 7.8%
Equipment 12,818 14,835 (13.6%)
Data processing 23,273 21,024 10.7%
Business development and advertising 15,194 13,812 10.0%
Stationery and supplies 6,705 7,044 (4.8%)
FDIC expense 1,428 1,533 (6.8%)
Mortgage servicing rights expense 29,553 30,473 (3.0%)
Other intangible amortization 2,961 2,283 29.7%
Loan expense 7,550 14,555 (48.1%)
Other 53,842 50,023 7.6%
--------- ---------
Total noninterest expense 394,759 374,549 5.4%
--------- ---------
Income before income taxes 321,716 296,326 8.6%
Income tax expense 93,059 85,607 8.7%
--------- ---------
Net Income $228,657 $210,719 8.5%
========= =========
Earnings Per Share:
Basic $3.10 $2.82 9.9%
Diluted $3.07 $2.79 10.0%
Average Shares Outstanding:
Basic 73,745 74,685 (1.3%)
Diluted 74,507 75,493 (1.3%)
N/M - Not meaningful.
---------------------------------------------------------------------
Selected Quarterly Information
Associated Banc-Corp
---------------------------------------------------------------------
(in thousands, YTD YTD 4th Qtr 3rd Qtr
except per share 2003 2002 2003 2003
data)
---------------------------------------------------------------------
Summary of Operations
Net interest
income 510,762 501,266 127,137 128,976
Provision for
loan losses 46,813 50,699 9,603 12,118
Net interest
income after
provision for
loan losses 463,949 450,567 117,534 116,858
Asset sale gains
(losses), net 1,569 657 1,366 871
Investment
securities gains
(losses), net 702 (427) - 1
Noninterest
income
(excluding
securities &
asset gains) 250,255 220,078 51,903 63,016
Noninterest
expense 394,759 374,549 94,912 97,771
Income taxes 93,059 85,607 20,282 24,589
Net income 228,657 210,719 55,609 58,386
Taxable
equivalent
adjustment 24,903 24,072 6,230 6,165
---------------------------------------------------------------------
Per Common Share Data (1)
Net income:
Basic $3.10 $2.82 $0.76 $0.79
Diluted 3.07 2.79 0.75 0.79
Dividends 1.33 1.21 0.34 0.34
Market Value:
High $43.13 $38.25 $43.13 $38.90
Low 32.15 27.20 38.81 37.12
Close 42.80 33.94 42.80 37.89
Book value 18.39 17.13 18.39 17.77
---------------------------------------------------------------------
Performance Ratios (annualized)
Net interest
margin (FTE) 3.84% 3.95% 3.81% 3.78%
Return on average
assets 1.53 1.47 1.49 1.53
Return on average
equity 17.58 17.10 16.85 17.75
Efficiency ratio
(2) 50.23 50.25 51.23 49.34
Effective tax
rate 28.93 28.89 26.73 29.63
Dividend payout
ratio (basic) 42.90 42.97 44.74 43.04
---------------------------------------------------------------------
Average Balances
Assets $14,969,860 $14,297,418 $14,852,390 $15,152,676
Earning assets 13,946,832 13,294,591 13,828,992 14,128,702
Interest-bearing
liabilities 11,855,236 11,396,581 11,637,646 11,955,420
Loans 10,622,499 10,002,478 10,354,726 10,813,769
Deposits 9,299,506 8,912,534 9,679,789 9,485,000
Stockholders'
equity 1,300,990 1,231,977 1,309,167 1,304,983
Stockholders'
equity / assets 8.69% 8.62% 8.81% 8.61%
---------------------------------------------------------------------
At Period End
Assets $15,247,894 $15,114,169
Loans 10,291,810 10,289,242
Allowance for
loan losses 177,622 176,223
Deposits 9,792,843 9,635,356
Stockholders'
equity 1,348,427 1,300,948
Stockholders'
equity / assets 8.84% 8.61%
Shares
outstanding, end
of period 73,311 73,227
---------------------------------------------------------------------
---------------------------------------------------------------------
Selected Quarterly Information
Associated Banc-Corp
---------------------------------------------------------------------
(in thousands, except per 2nd Qtr 2003 1st Qtr 2003 4th Qtr 2002
share data)
---------------------------------------------------------------------
Summary of Operations
Net interest income 127,195 127,454 129,713
Provision for loan losses 12,132 12,960 14,614
Net interest income after
provision for loan losses 115,063 114,494 115,099
Asset sale gains (losses), net (790) 122 (373)
Investment securities gains
(losses), net 1,027 (326) (801)
Noninterest income (excluding
securities & asset gains) 69,923 65,413 65,523
Noninterest expense 103,919 98,157 102,763
Income taxes 24,635 23,553 23,244
Net income 56,669 57,993 53,441
Taxable equivalent adjustment 6,231 6,277 5,981
---------------------------------------------------------------------
Per Common Share Data (1)
Net income:
Basic $0.77 $0.78 $0.72
Diluted 0.76 0.77 0.71
Dividends 0.34 0.31 0.31
Market Value:
High $38.41 $35.22 $34.21
Low 32.15 32.33 27.20
Close 36.61 32.33 33.94
Book value 17.88 17.41 17.13
---------------------------------------------------------------------
Performance Ratios (annualized)
Net interest margin (FTE) 3.79% 3.87% 3.87%
Return on average assets 1.51 1.58 1.42
Return on average equity 17.37 18.36 16.62
Efficiency ratio (2) 51.10 49.29 51.07
Effective tax rate 30.30 28.88 30.31
Dividend payout ratio (basic) 44.16 39.74 43.06
---------------------------------------------------------------------
Average Balances
Assets $15,016,497 $14,867,339 $14,901,747
Earning assets 13,991,615 13,836,102 13,870,491
Interest-bearing liabilities 11,941,877 11,886,642 11,792,552
Loans 10,743,430 10,578,430 10,559,154
Deposits 9,121,204 8,901,441 8,934,668
Stockholders' equity 1,308,505 1,280,950 1,275,914
Stockholders' equity / assets 8.71% 8.62% 8.56%
---------------------------------------------------------------------
At Period End
Assets $15,218,816 $15,089,166 $15,043,275
Loans 10,387,364 10,275,469 10,303,225
Allowance for loan losses 172,440 170,391 162,541
Deposits 9,453,460 9,060,234 9,124,852
Stockholders' equity 1,318,246 1,285,866 1,272,183
Stockholders' equity / assets 8.66% 8.52% 8.46%
Shares outstanding, end of
period 73,736 73,870 74,281
---------------------------------------------------------------------
(1) Per share data adjusted retroactively for stock splits and stock
dividends.
(2) Efficiency ratio = Noninterest expense divided by sum of taxable
equivalent net interest income plus noninterest income, excluding
investment securities gains, net, and asset sales gains, net.
----------------------------------------------------------------------
----------------------------------------------------------------------
Financial Summary and Comparison
Associated Banc-Corp Three months ended
December 31,
---------------------------------
(in thousands) 2003 2002 % Change
---------------------------------------------------------------------
Allowance for Loan Losses
Beginning balance $176,223 $155,288 13.5%
Balance related to acquisitions - - -
Provision for loan losses 9,603 14,614 (34.3%)
Charge offs (10,476) (7,884) 32.9%
Recoveries 2,272 523 334.4%
------------------------
Net charge offs (8,204) (7,361) 11.5%
------------------------
Ending Balance $177,622 $162,541 9.3%
========================
----------------------------------------------------------------------
Credit Quality 4th Qtr 3rd Qtr
2003 2003 % Change
----------------------------------
Nonaccrual loans $113,944 $114,067 (0.1%)
Loans 90 or more days past due and
still accruing (1) 7,495 11,055 (32.2%)
Restructured loans 43 44 (2.3%)
------------------------
Total nonperforming loans 121,482 125,166 (2.9%)
Other real estate owned 5,457 6,380 (14.5%)
------------------------
Total nonperforming assets 126,939 131,546 (3.5%)
========================
Net charge offs 8,204 8,335 (1.6%)
Allowance for loan losses / loans 1.73% 1.71%
Allowance for loan losses /
nonperforming loans 146.21 140.79
Nonperforming loans / total loans 1.18 1.22
Nonperforming assets / total assets 0.83 0.87
Net charge offs / average loans
(annualized) 0.31 0.31
Year-to-date net charge offs /
average loans 0.30 0.29
----------------------------------------------------------------------
Period End Loan Composition
Dec 31, Dec 31,
2003 2002 % Change
--------------------------------------
Commercial, financial &
agricultural $2,116,463 $2,213,986 (4.4%)
Real estate - construction 1,077,731 910,581 18.4%
Commercial real estate 3,246,954 3,128,826 3.8%
Lease financing 38,968 38,352 1.6%
----------------------------
Commercial 6,480,116 6,291,745 3.0%
Residential mortgage 2,145,227 2,430,746 (11.7%)
Home equity 968,744 864,631 12.0%
----------------------------
Residential real estate 3,113,971 3,295,377 (5.5%)
Consumer 697,723 716,103 (2.6%)
----------------------------
Total loans $10,291,810 $10,303,225 (0.1%)
============================
----------------------------------------------------------------------
Period End Deposit Composition
Dec 31, Dec 31,
2003 2002 % Change
---------------------------------
Demand $1,814,446 $1,773,699 2.3%
Savings 890,092 895,855 (0.6%)
Interest-bearing demand 2,330,478 1,468,193 58.7%
Money market 1,573,678 1,754,313 (10.3%)
Brokered CDs 165,130 233,650 (29.3%)
Other time deposits 3,019,019 2,999,142 0.7%
------------------------
Total deposits $9,792,843 $9,124,852 7.3%
========================
----------------------------------------------------------------------
Financial Summary and Comparison
Associated Banc-Corp Year ended
December 31,
----------------------------------
(in thousands) 2003 2002 % Change
----------------------------------------------------------------------
Allowance for Loan Losses
Beginning balance $162,541 $128,204 26.8%
Balance related to acquisitions - 11,985 N/M
Provision for loan losses 46,813 50,699 (7.7%)
Charge offs (37,107) (32,179) 15.3%
Recoveries 5,375 3,832 40.3%
-------------------------
Net charge offs (31,732) (28,347) 11.9%
-------------------------
Ending Balance $177,622 $162,541 9.3%
=========================
----------------------------------------------------------------------
Credit Quality 2nd Qtr 1st Qtr 4th Qtr
2003 2003 2002
----------------------------------
Nonaccrual loans $110,820 $90,384 $94,132
Loans 90 or more days past due and
still accruing (1) 6,311 3,425 3,912
Restructured loans 46 844 1,258
----------------------------------
Total nonperforming loans 117,177 94,653 99,302
Other real estate owned 14,707 12,949 11,448
----------------------------------
Total nonperforming assets 131,884 107,602 110,750
==================================
Net charge offs 10,083 5,110 7,361
Allowance for loan losses / loans 1.66% 1.66% 1.58%
Allowance for loan losses /
nonperforming loans 147.16 180.02 163.68
Nonperforming loans / total loans 1.13 0.92 0.96
Nonperforming assets / total assets 0.87 0.71 0.74
Net charge offs / average loans
(annualized) 0.38 0.20 0.28
Year-to-date net charge offs /
average loans 0.29 0.20 0.28
----------------------------------------------------------------------
Period End Loan Composition
Sept 30,
2003 % Change
---------------------
Commercial, financial &
agricultural $2,186,214 (3.2%)
Real estate - construction 1,035,674 4.1%
Commercial real estate 3,240,757 0.2%
Lease financing 37,193 4.8%
------------
Commercial 6,499,838 (0.3%)
Residential mortgage 2,166,187 (1.0%)
Home equity 912,142 6.2%
------------
Residential real estate 3,078,329 1.2%
Consumer 711,075 (1.9%)
------------
Total loans $10,289,242 0.0%
============
----------------------------------------------------------------------
Period End Deposit Composition
Sept 30,
2003 % Change
---------------------
Demand $1,804,596 0.5%
Savings 924,036 (3.7%)
Interest-bearing demand 2,086,964 11.7%
Money market 1,559,769 0.9%
Brokered CDs 156,994 5.2%
Other time deposits 3,102,997 (2.7%)
------------
Total deposits $9,635,356 1.6%
============
----------------------------------------------------------------------
N/M = Not Meaningful
(1) Does not include guaranteed student loans. Guaranteed student
loans 90+ days past due and still accruing totaled $13.0
million as of December 31, 2003.
----------------------------------------------------------------------
Net Interest Income Analysis - Taxable Equivalent Basis
Associated Banc-Corp
(in thousands) Year ended December 31, 2003
------------------------------
Average Interest Average
Balance Income / Yield /
Expense Rate
------------ --------- --------
Earning assets:
Loans: (1) (2) (3)
Commercial $6,450,523 $329,695 5.11%
Residential real estate 3,464,208 199,442 5.76
Consumer 707,768 50,725 7.17
------------ ---------
Total loans 10,622,499 579,862 5.46
Investments and other 3,324,333 172,405 5.19
------------ ---------
Total earning assets 13,946,832 752,267 5.39
Other assets, net 1,023,028
------------
Total assets $14,969,860
============
Interest-bearing liabilities:
Savings deposits $928,147 $4,875 0.53%
Interest-bearing demand deposits 1,827,304 15,348 0.84
Money market deposits 1,623,438 15,085 0.93
Time deposits, excluding Brokered
CDs 3,063,873 84,957 2.77
------------ ---------
Total interest-bearing deposits,
excluding Brokered CDs 7,442,762 120,265 1.62
Brokered CDs 178,853 2,857 1.60
------------ ---------
Total interest-bearing deposits 7,621,615 123,122 1.62
Wholesale funding 4,233,621 93,480 2.21
------------ ---------
Total interest-bearing liabilities 11,855,236 216,602 1.83
Noninterest-bearing demand 1,677,891
Other liabilities 135,743
Stockholders' equity 1,300,990
------------
Total liabilities and stockholders'
equity $14,969,860
============
Net interest income and rate spread
(1) $535,665 3.56%
=========
Net interest margin (1) 3.84%
Taxable equivalent adjustment $24,903
=========
----------------------------------------------------------------------
Three months ended December
31, 2003
------------------------------
Average Interest Average
Balance Income / Yield /
Expense Rate
------------ --------- --------
Earning assets:
Loans: (1) (2) (3)
Commercial $6,436,734 $80,185 4.88%
Residential real estate 3,215,935 45,304 5.59
Consumer 702,057 12,066 6.81
------------ ---------
Total loans 10,354,726 137,555 5.23
Investments and other 3,474,266 45,133 5.19
------------ ---------
Total earning assets 13,828,992 182,688 5.22
Other assets, net 1,023,398
------------
Total assets $14,852,390
============
Interest-bearing liabilities:
Savings deposits $922,336 $878 0.38%
Interest-bearing demand deposits 2,179,546 4,353 0.79
Money market deposits 1,572,197 3,391 0.86
Time deposits, excluding Brokered
CDs 3,067,720 20,132 2.60
------------ ---------
Total interest-bearing deposits,
excluding Brokered CDs 7,741,799 28,754 1.47
Brokered CDs 162,116 493 1.21
------------ ---------
Total interest-bearing deposits 7,903,915 29,247 1.47
Wholesale funding 3,733,731 20,074 2.12
------------ ---------
Total interest-bearing liabilities 11,637,646 49,321 1.68
Noninterest-bearing demand 1,775,874
Other liabilities 129,703
Stockholders' equity 1,309,167
------------
Total liabilities and stockholders'
equity $14,852,390
============
Net interest income and rate spread
(1) $133,367 3.54%
=========
Net interest margin (1) 3.81%
Taxable equivalent adjustment $6,230
=========
----------------------------------------------------------------------
Net Interest Income Analysis - Taxable Equivalent Basis
Associated Banc-Corp
(in thousands) Year ended December 31, 2002
------------------------------
Average Interest Average
Balance Income / Yield/
Expense Rate
------------ --------- -------
Earning assets:
Loans: (1) (2) (3)
Commercial $5,929,113 $348,082 5.87%
Residential real estate 3,362,179 223,314 6.64
Consumer 711,186 56,106 7.89
------------ ---------
Total loans 10,002,478 627,502 6.27
Investments and other 3,292,113 188,676 5.73
------------ ---------
Total earning assets 13,294,591 816,178 6.14
Other assets, net 1,002,827
------------
Total assets $14,297,418
============
Interest-bearing liabilities:
Savings deposits $891,105 $6,813 0.76%
Interest-bearing demand deposits 1,118,546 9,581 0.86
Money market deposits 1,876,988 24,717 1.32
Time deposits, excluding Brokered
CDs 3,263,766 122,181 3.74
------------ ---------
Total interest-bearing deposits,
excluding Brokered CDs 7,150,405 163,292 2.28
Brokered CDs 264,023 5,729 2.17
------------ ---------
Total interest-bearing deposits 7,414,428 169,021 2.28
Wholesale funding 3,982,153 121,819 3.06
------------ ---------
Total interest-bearing liabilities 11,396,581 290,840 2.55
Noninterest-bearing demand 1,498,106
Other liabilities 170,754
Stockholders' equity 1,231,977
------------
Total liabilities and stockholders'
equity $14,297,418
============
Net interest income and rate spread
(1) $525,338 3.59%
=========
Net interest margin (1) 3.95%
Taxable equivalent adjustment $24,072
=========
----------------------------------------------------------------------
Three months ended December
31, 2002
--------------------------------
Average Interest Average
Balance Income / Yield /
Expense Rate
------------ --------- --------
Earning assets:
Loans: (1) (2) (3)
Commercial $6,196,003 $86,908 5.50%
Residential real estate 3,641,592 57,371 6.26
Consumer 721,559 13,820 7.59
------------ ---------
Total loans 10,559,154 158,099 5.91
Investments and other 3,311,337 44,060 5.32
------------ ---------
Total earning assets 13,870,491 202,159 5.77
Other assets, net 1,031,256
------------
Total assets $14,901,747
============
Interest-bearing liabilities:
Savings deposits $918,934 $1,666 0.72%
Interest-bearing demand deposits 1,310,827 3,313 1.00
Money market deposits 1,768,559 5,259 1.18
Time deposits, excluding Brokered
CDs 3,064,447 24,558 3.18
------------ ---------
Total interest-bearing deposits,
excluding Brokered CDs 7,062,767 34,796 1.95
Brokered CDs 195,251 1,100 2.23
------------ ---------
Total interest-bearing deposits 7,258,018 35,896 1.96
Wholesale funding 4,534,534 30,569 2.65
------------ ---------
Total interest-bearing liabilities 11,792,552 66,465 2.23
Noninterest-bearing demand 1,676,650
Other liabilities 156,631
Stockholders' equity 1,275,914
------------
Total liabilities and stockholders'
equity $14,901,747
============
Net interest income and rate spread
(1) $135,694 3.54%
=========
Net interest margin (1) 3.87%
Taxable equivalent adjustment $5,981
=========
---------------------------------------------------------------------
(1) The yield on tax exempt loans and securities is computed on a
taxable equivalent basis using a tax rate of 35% for all periods
presented and is net of the effects of certain disallowed interest
deductions.
(2) Nonaccrual loans and loans held for sale have been included in the
average balances.
(3) Interest income includes net loan fees.
CONTACT: Associated Banc-Corp
Investors:
Joe Selner, 920-491-7120
Media:
Jon Drayna, 920-491-7006
SOURCE: Associated Banc-Corp