Press Release Details

Associated Reports Fourth Quarter Earnings of $0.23 per Share

01/19/2012

GREEN BAY, Wis., Jan. 19, 2012 /PRNewswire/ -- Associated Banc-Corp (NASDAQ: ASBC) today reported net income to common shareholders of $40 million, or $0.23 per common share, for the quarter ended December 31, 2011. This compares to net income to common shareholders of $34 million, or $0.20 per common share, for the quarter ended September 30, 2011, and net income to common shareholders of $7 million, or $0.04 per common share, for the quarter ended December 31, 2010.

For the year ended December 31, 2011, the Company reported net income to common shareholders of $115 million, or $0.66 per common share.  This compares to a net loss to common shareholders of $30 million, or $0.18 per common share for the year ended December 31, 2010.

"We are pleased with the results and accomplishments achieved over the past year.  We have been serving our customers for 150 years and remain committed to meeting their needs.  We believe that results from the fourth quarter reflect both our core franchise strength and our ability to deliver value to customers and shareholders," said President and CEO Philip B. Flynn.

HIGHLIGHTS  

  • Quarterly net income to common shareholders improved by 17%, or $6 million from the prior quarter
    • Full year 2011 net income to common shareholders of $115 million
  • Loan balances increased by a net $528 million, or 4%, during the fourth quarter to $14.0 billion; loans grew in each major portfolio during the fourth quarter, including:
    • Commercial and business lending grew $386 million
    • Commercial real estate lending increased $112 million
    • Residential mortgage loans grew $111 million
  • Loans increased by $1.4 billion, or 11%, during 2011
  • Credit metrics continued to improve during the fourth quarter; nonaccrual loans declined $47 million, or 12%, from the prior quarter to $357 million, the lowest level in eight quarters, while net charge offs were down 25% from the prior quarter
    • Nonaccruals have declined 38% from $574 million at the fourth quarter of 2010
    • Net charge offs of $151 million for full year 2011 declined 69% from full year 2010

FOURTH QUARTER 2011 FINANCIAL RESULTS

Loans

At December 31, 2011, the Company's loan portfolio was $14.0 billion, up $528 million, or 4%, from $13.5 billion at September 30, 2011, and up $1.4 billion, or 11%, from $12.6 billion a year ago.  Total commercial loans grew $498 million on a linked-quarter basis, with strong growth coming from both the commercial and industrial (C&I) and commercial real estate (CRE) portfolios.  The retail loan and residential mortgage portfolios grew by a net $29 million from the third quarter, with a $111 million increase in residential mortgage partially offset by a decrease in the home equity loan book of $67 million.

Deposits

Total deposits of $15.1 billion at the end of the fourth quarter were up 2% from $14.8 billion at the end of the third quarter.  The net deposit growth during the quarter included a $217 million, or 6% increase, in demand deposits and a $226 million, or 11% increase, in interest-bearing demand deposits.

Net Interest Income and Net Interest Margin

Fourth quarter net interest income was $152 million.  Consistent with the Company's strategy of funding loan growth primarily through securities run-off, net interest income from loans grew quarter over quarter while interest income from securities continued to contract.  The net interest margin for the fourth quarter was 3.21%, a decline of 2 basis points from the prior quarter.  Yields on earning assets compressed by 7 basis points quarter over quarter, while the cost of interest-bearing liabilities declined by 5 basis points; contributing to the modest reduction in overall net interest margin.

Noninterest Income and Expense

Noninterest income for the quarter was $74 million, up $2 million, or 3%, from the third quarter.  Card-based and other nondeposit revenues declined by $4 million from the prior quarter, primarily due to the expected phased-in impact of the Durbin amendment.  Mortgage banking income increased by $5 million from the third quarter, driven by higher mortgage production, lower valuation expense on mortgage servicing rights, and a $3 million gain on sale of $94 million of portfolio mortgages.

Personnel and occupancy expenses remained relatively flat from the prior quarter.  However, total noninterest expense for the quarter ended December 31, 2011 was $175 million, up $13 million, or 8%, from the third quarter, primarily attributable to a $10 million change in losses other than loans.  The largest contributor to losses other than loans related to additional litigation reserves established for the previously disclosed settlement of a legal matter.  Other drivers of the increase in noninterest expense include increased data processing expense and increased business development and advertising expenses.  Offsetting the net income impact of the losses other than loans was a reversal of certain prior years' tax reserves as a result of the expiration of the statute of limitations.

In December, the Company announced plans to consolidate 21 retail branches during the first and second quarters of 2012 as part of its footprint enhancement strategy.  All of the impacted branches are within close proximity to other remaining Associated locations, in most cases within two miles, and the Company remains committed to continuing to invest throughout its three-state footprint.  The consolidations are expected to increase the deposits per branch in the remaining locations while allowing the Company to service the impacted markets more efficiently.

Key Credit Metrics

The Company reported another quarter of improving credit metrics with nonaccrual loans down 12% to $357 million from $403 million at September 30, 2011, and down 38% from $574 million at December 31, 2010.  Net charge offs were $23 million for the fourth quarter, down 25% from $30 million for the third quarter of 2011, and down 79% from $108 million for the fourth quarter of 2010.  Fourth quarter provision for loan losses was $1 million, down from $4 million for the third quarter of 2011, and down from $63 million for the fourth quarter of 2010.  The Company's allowance for loan losses was $378 million, representing an allowance equal to 2.70% of loans, and covered over 105% of nonaccrual loans at December 31, 2011.

Capital Ratios

The Company's capital position remains very strong, with a Tier 1 common equity ratio of 12.24% at December 31, 2011, compared to 12.26% a year ago.  The Company's capital ratios continue to be in excess of "well-capitalized" regulatory benchmarks, and also exceed the proposed Basel III guidelines.

"We are pleased with the solid results of this quarter and with our progress throughout the year," Flynn continued.  "We believe that our recent success is a result of our customer centric focus and of the investments we have made to strengthen our core businesses. Despite the challenging environment, we remain optimistic and are committed to building shareholder value through our long-term strategy for growth at Associated."

FOURTH QUARTER 2011 EARNINGS RELEASE CONFERENCE CALL

The Company will host a conference call for investors and analysts at 4:00 p.m. Central Time (CT) today, January 19, 2012.  Interested parties can listen to the call live on the Internet through the investor relations section of the company's website, http://investor.associatedbank.com/ or by dialing 877-348-9354. The slide presentation for the call will be available on the company's website just prior to the call.  The number for international callers is 253-237-1160. Participants should ask the operator for the Associated Banc-Corp fourth quarter 2011 earnings call, or conference ID number 37612937.

An audio archive of the webcast will be available on the company's website for one month following the call.  A replay of the call will be available starting at 7:00 p.m. CT on January 19, 2012 through 11:00 p.m. CT on February 19, 2012 by dialing 855-859-2056 and entering the conference ID number 37612937. The replay number for international callers is 404-537-3406.  

ABOUT ASSOCIATED BANC-CORP

Associated Banc-Corp (NASDAQ: ASBC) has total assets of $22 billion and is one of the top 50 financial services holding companies operating in the United States.  Headquartered in Green Bay, Wis., Associated has approximately 270 banking locations serving more than 150 communities throughout Wisconsin, Illinois and Minnesota.  The company offers a full range of banking services and other financial products and services.  More information about Associated Banc-Corp is available at www.associatedbank.com.

FORWARD LOOKING STATEMENTS

Statements made in this document that are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management's plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance. Forward-looking statements are based on current management expectations and, by their nature, are subject to risks and uncertainties. These statements may be identified by the use of words such as "believe," "expect," "anticipate," "plan," "estimate," "should," "will," "intend," "outlook," or similar expressions. Outcomes related to such statements are subject to numerous risk factors and uncertainties including those listed in the Company's most recent Annual Report filed on Form 10-K as updated by the Company's most recent Form 10-Q.

Investor Contact:
Tim Sedabres, Vice President, Finance
920-491-7059

Media Contact:
Autumn Latimore, Senior Vice President, Public Relations Director
414-278-1860

Consolidated Balance Sheets (Unaudited) 

Associated Banc-Corp



December 31,


September 30,


Seql Qtr


June 30,


March 31,


December 31,


Comp Qtr

(in thousands)


2011


2011


$ Change


2011


2011


2010


$ Change

Assets















Cash and due from banks


$        454,958


$       410,644


$   44,314


$      314,682


$      299,040


$      319,487


$   135,471

Interest-bearing deposits in other















financial institutions


154,562


250,648


(96,086)


777,675


498,094


546,125


(391,563)

Federal funds sold and securities purchased















under agreements to resell


7,075


4,180


2,895


2,400


2,015


2,550


4,525

Securities available for sale, at fair value


4,937,483


5,453,816


(516,333)


5,742,034


5,883,541


6,101,341


(1,163,858)

Federal Home Loan Bank and Federal















  Reserve Bank stocks, at cost


191,188


191,128


60


191,075


191,017


190,968


220

Loans held for sale


249,195


201,142


48,053


84,323


85,493


144,808


104,387

Loans


14,031,071


13,503,507


527,564


13,089,589


12,655,322


12,616,735


1,414,336

Allowance for loan losses


(378,151)


(399,723)


21,572


(425,961)


(454,461)


(476,813)


98,662

   Loans, net


13,652,920


13,103,784


549,136


12,663,628


12,200,861


12,139,922


1,512,998

Premises and equipment, net


223,736


208,301


15,435


192,506


186,329


190,533


33,203

Goodwill


929,168


929,168


-


929,168


929,168


929,168


-

Other intangible assets, net


67,574


67,970


(396)


74,872


85,200


88,044


(20,470)

Other assets


1,056,358


1,081,868


(25,510)


1,076,112


1,112,807


1,132,650


(76,292)

   Total assets


$   21,924,217


$  21,902,649


$   21,568


$ 22,048,475


$ 21,473,565


$ 21,785,596


138,621
















Liabilities and Stockholders' Equity















Noninterest-bearing deposits


$     3,928,792


$    3,711,570


$ 217,222


$   3,218,722


$   3,285,604


$   3,684,965


243,827

Interest-bearing deposits, excl Brokered CDs


10,958,915


10,867,013


91,902


10,530,658


10,413,994


11,097,788


(138,873)

Brokered CDs


202,948


203,827


(879)


316,670


324,045


442,640


(239,692)

   Total deposits


15,090,655


14,782,410


308,245


14,066,050


14,023,643


15,225,393


(134,738)

Short-term funding


2,514,485


2,531,776


(17,291)


3,255,670


2,547,805


1,747,382


767,103

Long-term funding


1,177,071


1,477,408


(300,337)


1,484,174


1,484,177


1,413,605


(236,534)

Accrued expenses and other liabilities


276,212


260,436


15,776


243,433


223,226


240,425


35,787

   Total liabilities


19,058,423


19,052,030


6,393


19,049,327


18,278,851


18,626,805


431,618

Stockholders' Equity















 Preferred equity


63,272


63,272


-


258,051


515,238


514,388


(451,116)

 Common stock


1,746


1,746


-


1,745


1,744


1,739


7

 Surplus


1,586,401


1,585,208


1,193


1,581,594


1,576,903


1,573,372


13,029

 Retained earnings


1,148,773


1,111,080


37,693


1,079,076


1,055,344


1,041,666


107,107

 Accumulated other comprehensive income


65,602


89,313


(23,711)


79,345


45,731


27,626


37,976

 Treasury stock


-


-


-


(663)


(246)


-


-

   Total stockholders' equity


2,865,794


2,850,619


15,175


2,999,148


3,194,714


3,158,791


(292,997)

   Total liabilities and stockholders' equity


$   21,924,217


$  21,902,649


$   21,568


$ 22,048,475


$ 21,473,565


$ 21,785,596


$   138,621



Consolidated Statements of Income (Unaudited) 

Associated Banc-Corp



For The Three Months Ended





For The Year Ended,






December 31,


Quarter


December 31,


Year-to-Date

(in thousands, except per share amounts)


2011


2010


$ Change

% Change


2011


2010


$ Change

% Change

Interest Income















Interest and fees on loans


$ 149,832


$ 146,444


$   3,388

2.3%


$ 582,739


$ 608,487


$ (25,748)

(4.2%)

Interest and dividends on investment securities:















 Taxable


22,855


32,420


(9,565)

(29.5%)


123,371


155,031


(31,660)

(20.4%)

 Tax-exempt


7,344


8,150


(806)

(9.9%)


29,937


33,915


(3,978)

(11.7%)

Other interest


1,251


2,078


(827)

(39.8%)


5,575


8,693


(3,118)

(35.9%)

   Total interest income


181,282


189,092


(7,810)

(4.1%)


741,622


806,126


(64,504)

(8.0%)

Interest Expense















Interest on deposits


14,954


23,039


(8,085)

(35.1%)


65,748


106,023


(40,275)

(38.0%)

Interest on short-term borrowings


2,156


2,288


(132)

(5.8%)


12,411


7,983


4,428

55.5%

Interest on long-term funding


12,347


12,905


(558)

(4.3%)


50,632


58,341


(7,709)

(13.2%)

   Total interest expense


29,457


38,232


(8,775)

(23.0%)


128,791


172,347


(43,556)

(25.3%)

Net Interest Income


151,825


150,860


965

0.6%


612,831


633,779


(20,948)

(3.3%)

Provision for loan losses


1,000


63,000


(62,000)

(98.4%)


52,000


390,010


(338,010)

(86.7%)

Net interest income after provision for















loan losses


150,825


87,860


62,965

71.7%


560,831


243,769


317,062

130.1%

Noninterest Income















Trust service fees


9,511


9,518


(7)

(0.1%)


39,145


37,853


1,292

3.4%

Service charges on deposit accounts


17,783


20,390


(2,607)

(12.8%)


75,908


96,740


(20,832)

(21.5%)

Card-based and other nondeposit fees


11,269


15,842


(4,573)

(28.9%)


57,905


59,299


(1,394)

(2.4%)

Retail commissions


14,881


14,441


440

3.0%


62,784


61,256


1,528

2.5%

 Total core fee-based revenue


53,444


60,191


(6,747)

(11.2%)


235,742


255,148


(19,406)

(7.6%)
















Mortgage banking, net


9,677


13,229


(3,552)

(26.9%)


12,723


33,136


(20,413)

(61.6%)

Capital market fees, net


3,950


5,187


(1,237)

(23.8%)


8,711


6,072


2,639

43.5%

Bank owned life insurance income


3,820


4,509


(689)

(15.3%)


14,896


15,761


(865)

(5.5%)

Asset sale gains (losses), net


525


514


11

2.1%


(2,849)


(2,004)


(845)

42.2%

Investment securities gains (losses), net


(310)


(1,883)


1,573

(83.5%)


(1,112)


24,917


(26,029)

(104.5%)

Other


2,750


2,950


(200)

(6.8%)


14,358


12,493


1,865

14.9%

   Total noninterest income


73,856


84,697


(10,841)

(12.8%)


282,469


345,523


(63,054)

(18.2%)

Noninterest Expense















Personnel expense


89,785


83,912


5,873

7.0%


358,295


323,249


35,046

10.8%

Occupancy


13,796


12,899


897

7.0%


55,939


49,937


6,002

12.0%

Equipment


5,286


4,899


387

7.9%


19,873


18,371


1,502

8.2%

Data processing


9,080


7,047


2,033

28.8%


32,475


29,714


2,761

9.3%

Business development and advertising


6,904


4,870


2,034

41.8%


23,038


18,385


4,653

25.3%

Other intangible amortization


1,179


1,206


(27)

(2.2%)


4,714


4,919


(205)

(4.2%)

Loan expense


3,469


2,735


734

26.8%


12,008


9,965


2,043

20.5%

Legal and professional fees


4,651


5,353


(702)

(13.1%)


18,205


20,439


(2,234)

(10.9%)

Losses other than loans


11,890


7,470


4,420

59.2%


17,921


14,793


3,128

21.1%

Foreclosure/OREO expense


7,493


9,860


(2,367)

(24.0%)


30,743


33,844


(3,101)

(9.2%)

FDIC expense


6,136


11,095


(4,959)

(44.7%)


28,484


46,377


(17,893)

(38.6%)

Other


14,982


15,497


(515)

(3.3%)


58,178


60,327


(2,149)

(3.6%)

   Total noninterest expense


174,651


166,843


7,808

4.7%


659,873


630,320


29,553

4.7%

Income (Loss) before income taxes


50,030


5,714


44,316

N/M


183,427


(41,028)


224,455

N/M

Income tax expense (benefit)


8,905


(8,294)


17,199

N/M


43,728


(40,172)


83,900

N/M

Net income (loss)


41,125


14,008


27,117

193.6%


$ 139,699


$      (856)


$ 140,555

N/M

Preferred stock dividends and discount


1,300


7,400


(6,100)

(82.4%)


24,830


29,531


(4,701)

(15.9%)

Net income (loss) available to common equity


$   39,825


$     6,608


$ 33,217

N/M


$ 114,869


$ (30,387)


$ 145,256

N/M
















Earnings (Loss) Per Common Share:















 Basic


$       0.23


$       0.04


$     0.19

N/M


$       0.66


$     (0.18)


$       0.84

N/M

 Diluted


$       0.23


$       0.04


$     0.19

N/M


$       0.66


$     (0.18)


$       0.84

N/M
















Average Common Shares Outstanding:















 Basic


173,523


173,068


455

0.3%


173,370


171,230


2,140

1.3%

 Diluted


173,523


173,072


451

0.3%


173,372


171,230


2,142

1.3%
















N/M = Not meaningful



Consolidated Statements of Income (Unaudited) - Quarterly Trend 

Associated Banc-Corp






Sequential Qtr


Comparable Qtr

(in thousands, except per share amounts)


4Q11


3Q11


$ Change

% Change


2Q11


1Q11


4Q10


$ Change

% Change

Interest Income

















Interest and fees on loans


$ 149,832


$ 145,778


$   4,054

2.8%


$ 144,358


$ 142,771


$ 146,444


$   3,388

2.3%

Interest and dividends on investment securities:

















 Taxable


22,855


30,513


(7,658)

(25.1%)


35,351


34,652


32,420


(9,565)

(29.5%)

 Tax-exempt


7,344


7,376


(32)

(0.4%)


7,504


7,713


8,150


(806)

(9.9%)

Other interest


1,251


1,428


(177)

(12.4%)


1,438


1,458


2,078


(827)

(39.8%)

   Total interest income


181,282


185,095


(3,813)

(2.1%)


188,651


186,594


189,092


(7,810)

(4.1%)

Interest Expense

















Interest on deposits


14,954


15,644


(690)

(4.4%)


16,901


18,249


23,039


(8,085)

(35.1%)

Interest on short-term borrowings


2,156


3,039


(883)

(29.1%)


3,637


3,579


2,288


(132)

(5.8%)

Interest on long-term funding


12,347


13,252


(905)

(6.8%)


13,990


11,043


12,905


(558)

(4.3%)

   Total interest expense


29,457


31,935


(2,478)

(7.8%)


34,528


32,871


38,232


(8,775)

(23.0%)

Net Interest Income


151,825


153,160


(1,335)

(0.9%)


154,123


153,723


150,860


965

0.6%

Provision for loan losses


1,000


4,000


(3,000)

(75.0%)


16,000


31,000


63,000


(62,000)

(98.4%)

Net interest income after provision for

















loan losses


150,825


149,160


1,665

1.1%


138,123


122,723


87,860


62,965

71.7%

Noninterest Income

















Trust service fees


9,511


9,791


(280)

(2.9%)


10,012


9,831


9,518


(7)

(0.1%)

Service charges on deposit accounts


17,783


19,949


(2,166)

(10.9%)


19,112


19,064


20,390


(2,607)

(12.8%)

Card-based and other nondeposit fees


11,269


15,291


(4,022)

(26.3%)


15,747


15,598


15,842


(4,573)

(28.9%)

Retail commissions


14,881


15,047


(166)

(1.1%)


16,475


16,381


14,441


440

3.0%

 Total core fee-based revenue


53,444


60,078


(6,634)

(11.0%)


61,346


60,874


60,191


(6,747)

(11.2%)


















Mortgage banking, net


9,677


4,521


5,156

114.0%


(3,320)


1,845


13,229


(3,552)

(26.9%)

Capital market fees, net


3,950


3,273


677

20.7%


(890)


2,378


5,187


(1,237)

(23.8%)

Bank owned life insurance income


3,820


3,990


(170)

(4.3%)


3,500


3,586


4,509


(689)

(15.3%)

Asset sale gains (losses), net


525


(1,179)


1,704

(144.5%)


(209)


(1,986)


514


11

2.1%

Investment securities losses, net


(310)


(744)


434

(58.3%)


(36)


(22)


(1,883)


1,573

(83.5%)

Other


2,750


1,737


1,013

58.3%


4,364


5,507


2,950


(200)

(6.8%)

   Total noninterest income


73,856


71,676


2,180

3.0%


64,755


72,182


84,697


(10,841)

(12.8%)

Noninterest Expense

















Personnel expense


89,785


90,377


(592)

(0.7%)


89,203


88,930


83,912


5,873

7.0%

Occupancy


13,796


14,205


(409)

(2.9%)


12,663


15,275


12,899


897

7.0%

Equipment


5,286


4,851


435

9.0%


4,969


4,767


4,899


387

7.9%

Data processing


9,080


7,887


1,193

15.1%


7,974


7,534


7,047


2,033

28.8%

Business development and advertising


6,904


5,539


1,365

24.6%


5,652


4,943


4,870


2,034

41.8%

Other intangible amortization


1,179


1,179


-

0.0%


1,178


1,178


1,206


(27)

(2.2%)

Loan expense


3,469


2,600


869

33.4%


2,983


2,956


2,735


734

26.8%

Legal and professional fees


4,651


4,289


362

8.4%


4,783


4,482


5,353


(702)

(13.1%)

Losses other than loans


11,890


1,659


10,231

N/M


(1,925)


6,297


7,470


4,420

59.2%

Foreclosure/OREO expense


7,493


7,662


(169)

(2.2%)


9,527


6,061


9,860


(2,367)

(24.0%)

FDIC expense


6,136


6,906


(770)

(11.1%)


7,198


8,244


11,095


(4,959)

(44.7%)

Other


14,982


15,006


(24)

(0.2%)


14,681


13,509


15,497


(515)

(3.3%)

   Total noninterest expense


174,651


162,160


12,491

7.7%


158,886


164,176


166,843


7,808

4.7%

Income before income taxes


50,030


58,676


(8,646)

(14.7%)


43,992


30,729


5,714


44,316

N/M

Income tax expense (benefit)


8,905


17,337


(8,432)

(48.6%)


9,610


7,876


(8,294)


17,199

N/M

Net income


41,125


41,339


(214)

(0.5%)


34,382


22,853


14,008


27,117

193.6%

Preferred stock dividends and discount


1,300


7,305


(6,005)

(82.2%)


8,812


7,413


7,400


(6,100)

(82.4%)

Net income available to common equity


$   39,825


$   34,034


$   5,791

17.0%


$   25,570


$   15,440


$     6,608


$ 33,217

N/M


















Earnings Per Common Share:

















 Basic


$       0.23


$       0.20


$     0.03

15.0%


$       0.15


$       0.09


$       0.04


$     0.19

N/M

 Diluted


$       0.23


$       0.20


$     0.03

15.0%


$       0.15


$       0.09


$       0.04


$     0.19

N/M


















Average Common Shares Outstanding:

















 Basic


173,523


173,418


105

0.1%


173,323


173,213


173,068


455

0.3%

 Diluted


173,523


173,418


105

0.1%


173,327


173,217


173,072


451

0.3%


















N/M = Not meaningful.



Selected Quarterly Information

Associated Banc-Corp


(in thousands, except per share and full time equivalent employee data)

YTD 2011


YTD 2010


4th Qtr 2011


3rd Qtr 2011


2nd Qtr 2011


1st Qtr 2011


4th Qtr 2010

Summary of Operations














Net interest income

$      612,831


$      633,779


$      151,825


$      153,160


$      154,123


$      153,723


$      150,860

Provision for loan losses

52,000


390,010


1,000


4,000


16,000


31,000


63,000

Asset sale gains (losses), net

(2,849)


(2,004)


525


(1,179)


(209)


(1,986)


514

Investment securities gains (losses), net

(1,112)


24,917


(310)


(744)


(36)


(22)


(1,883)

Noninterest income (excluding securities & asset gains)

286,430


322,610


73,641


73,599


65,000


74,190


86,066

Noninterest expense

659,873


630,320


174,651


162,160


158,886


164,176


166,843

Income (loss) before income taxes

183,427


(41,028)


50,030


58,676


43,992


30,729


5,714

Income tax expense (benefit)

43,728


(40,172)


8,905


17,337


9,610


7,876


(8,294)

Net income (loss)

139,699


(856)


41,125


41,339


34,382


22,853


14,008

Net income (loss) available to common equity

114,869


(30,387)


39,825


34,034


25,570


15,440


6,608

Taxable equivalent adjustment

21,374


23,635


5,307


5,295


5,332


5,440


5,721















Per Common Share Data














Net income (loss):














 Basic

$            0.66


$          (0.18)


$            0.23


$            0.20


$            0.15


$            0.09


$            0.04

 Diluted

0.66


(0.18)


0.23


0.20


0.15


0.09


0.04

Dividends

0.04


0.04


0.01


0.01


0.01


0.01


0.01

Market Value:














 High

$          15.36


$          16.10


$          11.78


$          14.17


$          15.02


$          15.36


$          15.49

 Low

8.95


11.48


9.15


8.95


13.06


13.83


12.57

 Close

11.17


15.15


11.17


9.30


13.90


14.85


15.15

Book value

16.15


15.28


16.15


16.07


15.81


15.46


15.28

Tangible book value

10.68


9.77


10.68


10.59


10.33


9.97


9.77















Performance Ratios (annualized)














Earning assets yield

3.92%


4.03%


3.81%


3.88%


4.00%


4.01%


3.89%

Interest-bearing liabilities rate

0.85


1.06


0.78


0.83


0.91


0.89


0.98

Net interest margin

3.26


3.20


3.21


3.23


3.29


3.32


3.13

Return on average assets

0.65


(0.00)


0.75


0.75


0.64


0.43


0.25

Return on average equity

4.66


(0.03)


5.71


5.49


4.63


2.92


1.74

Return on average Tier 1 common equity (1)

6.71


(1.95)


8.96


7.83


6.07


3.76


1.59

Efficiency ratio (2)

71.68


64.32


75.68


69.88


70.79


70.36


68.76

Effective tax rate (benefit)

23.84


97.91


17.80


29.55


21.84


25.63


(145.13)

Dividend payout ratio (3)

6.06


22.22


4.35


5.00


6.67


11.11


25.00















Average Balances














Assets

$ 21,588,620


$ 22,625,065


$ 21,755,870


$ 21,729,187


$ 21,526,155


$ 21,336,858


$ 22,034,041

Earning assets

19,442,263


20,568,495


19,506,627


19,530,007


19,431,292


19,297,866


19,950,784

Interest-bearing liabilities

15,120,824


16,304,220


15,095,689


15,215,517


15,261,514


14,907,465


15,476,002

Loans (4)

13,278,848


13,186,712


14,043,585


13,376,928


13,004,904


12,673,844


12,587,702

Deposits

14,401,127


16,946,301


14,893,469


14,405,311


14,052,689


14,245,614


16,452,473

Short and long-term funding

4,100,825


2,452,610


3,857,252


4,227,319


4,434,500


3,883,122


2,311,016

Common stockholders' equity

2,730,643


2,670,953


2,792,823


2,765,023


2,704,909


2,657,956


2,681,813

Stockholders' equity

2,997,290


3,183,572


2,856,095


2,987,178


2,976,840


3,172,636


3,195,657

Common stockholders' equity / assets

12.65%


11.81%


12.84%


12.72%


12.57%


12.46%


12.17%

Stockholders' equity / assets

13.88%


14.07%


13.13%


13.75%


13.83%


14.87%


14.50%















At Period End














Assets





$ 21,924,217


$ 21,902,649


$ 22,048,475


$ 21,473,565


$ 21,785,596

Loans





14,031,071


13,503,507


13,089,589


12,655,322


12,616,735

Allowance for loan losses





378,151


399,723


425,961


454,461


476,813

Goodwill





929,168


929,168


929,168


929,168


929,168

Mortgage servicing rights, net





48,152


47,370


53,093


62,243


63,909

Other intangible assets





19,422


20,600


21,779


22,957


24,135

Deposits





15,090,655


14,782,410


14,066,050


14,023,643


15,225,393

Short and long-term funding





3,691,556


4,009,184


4,739,844


4,031,982


3,160,987

Stockholders' equity





2,865,794


2,850,619


2,999,148


3,194,714


3,158,791

Stockholders' equity / assets





13.07%


13.01%


13.60%


14.88%


14.50%

Tangible common equity / tangible assets (5)





8.84%


8.77%


8.49%


8.42%


8.12%

Tangible equity/tangible assets (6)





9.14%


9.07%


9.71%


10.93%


10.59%

Tier 1 common equity / risk-weighted assets (7)





12.24%


12.44%


12.61%


12.65%


12.26%

Tier 1 leverage ratio





9.81%


9.62%


10.46%


11.65%


11.19%

Tier 1 risk-based capital ratio





14.08%


14.35%


16.03%


18.08%


17.58%

Total risk-based capital ratio





15.53%


15.81%


17.50%


19.56%


19.05%

Shares outstanding, end of period





173,575


173,474


173,374


173,274


173,112















Selected trend information














Average full time equivalent employees





5,056


4,980


4,977


4,929


4,865

Trust assets under management, at market value





$   5,600,000


$   5,300,000


$   5,700,000


$   5,900,000


$   5,700,000

Mortgage loans originated for sale during period





843,614


470,530


250,880


290,013


629,978

Mortgage portfolio serviced for others





7,321,000


7,281,000


7,367,000


7,476,000


7,453,000

Mortgage servicing rights, net / Portfolio serviced for others





0.66%


0.65%


0.72%


0.83%


0.86%

















(1)

Return on average Tier 1 common equity = Net income available to common equity divided by average Tier 1 capital excluding qualifying perpetual preferred stock and qualifying trust preferred securities.


This is a non-GAAP financial measure.



(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.


This is a non-GAAP financial measure.



(3)

Ratio is based upon basic earnings per common share.



(4)

Loans held for sale have been included in the average balances.



(5)

Tangible common equity to tangible assets = Common stockholders' equity excluding goodwill and other intangible assets divided by assets excluding goodwill and other intangible assets.


This is a non-GAAP financial measure



(6)

Tangible equity to tangible assets = Stockholders' equity excluding goodwill and other intangible assets divided by assets excluding goodwill and other intangible assets.


This is a non-GAAP financial measure.



(7)

Tier 1 common equity to risk-weighted assets = Tier 1 capital excluding qualifying perpetual preferred stock and qualifying trust preferred securities divided by risk-weighted assets.  This is a non-GAAP financial measure.



Selected Asset Quality Information 

Associated Banc-Corp





Dec11 vs Sep11





Dec11 vs Dec10

(in thousands)


Dec 31, 2011

Sep 30, 2011

% Change


Jun 30, 2011

Mar 31, 2011

Dec 31, 2010

% Change

Allowance for Loan Losses










Beginning balance


$     399,723

$     425,961

(6.2%)


$     454,461

$     476,813

$     522,018

(23.4%)

Provision for loan losses


1,000

4,000

(75.0%)


16,000

31,000

63,000

(98.4%)

Charge offs


(34,056)

(38,155)

(10.7%)


(52,365)

(65,156)

(118,368)

(71.2%)

Recoveries


11,484

7,917

45.1%


7,865

11,804

10,163

13.0%

Net charge offs


(22,572)

(30,238)

(25.4%)


(44,500)

(53,352)

(108,205)

(79.1%)

Ending balance


$     378,151

$     399,723

(5.4%)


$     425,961

$     454,461

$     476,813

(20.7%)











Reserve for losses on unfunded commitments


$       14,700

$       14,900

(1.3%)


$       14,900

$       17,800

$       17,374

(15.4%)





















Net Charge Offs




Dec11 vs Sep11





Dec11 vs Dec10



Dec 31, 2011

Sep 30, 2011

% Change


Jun 30, 2011

Mar 31, 2011

Dec 31, 2010

% Change

Commercial and industrial


$            231

$         3,741

(93.8%)


$       14,026

$         4,314

$       27,041

(99.1%)

Commercial real estate - owner occupied


539

134

302.2%


4,436

1,867

11,778

(95.4%)

Lease financing


19

(1,889)

(101.0%)


60

28

9,159

(99.8%)

 Commercial and business lending


789

1,986

(60.3%)


18,522

6,209

47,978

(98.4%)

Commercial real estate - investor


2,394

10,472

(77.1%)


4,941

6,006

8,325

(71.2%)

Real estate - construction


7,088

5,646

25.5%


6,031

11,936

31,879

(77.8%)

 Commercial real estate lending


9,482

16,118

(41.2%)


10,972

17,942

40,204

(76.4%)

   Total commercial


10,271

18,104

(43.3%)


29,494

24,151

88,182

(88.4%)

Home equity


8,113

8,736

(7.1%)


8,251

14,322

14,541

(44.2%)

Installment(1)


452

764

(40.8%)


664

12,670

2,369

(80.9%)

   Total retail


8,565

9,500

(9.8%)


8,915

26,992

16,910

(49.3%)

   Residential mortgage


3,736

2,634

41.8%


6,091

2,209

3,113

20.0%

       Total net charge offs


$       22,572

$       30,238

(25.4%)


$       44,500

$       53,352

$     108,205

(79.1%)











Net Charge Offs to Average Loans (in basis points) *


Dec 31, 2011

Sep 30, 2011



Jun 30, 2011

Mar 31, 2011

Dec 31, 2010


Commercial and industrial


3

46



180

60

364


Commercial real estate - owner occupied


20

5



174

72

438


Lease financing


14

(1,396)



44

20

5,051


 Commercial and business lending


7

18



177

63

466


Commercial real estate - investor


38

169



83

104

139


Real estate - construction


502

407



454

888

1,820


 Commercial real estate lending


122

213



151

252

518


   Total commercial


53

98



166

142

488


Home equity


127

134



127

227

231


Installment


32

52



42

759

131


   Total retail


110

119



111

338

209


   Residential mortgage


46

36



92

35

56


       Total net charge offs


64

90



137

171

341






















Credit Quality




Dec11 vs Sep11





Dec11 vs Dec10



Dec 31, 2011

Sep 30, 2011

% Change


Jun 30, 2011

Mar 31, 2011

Dec 31, 2010

% Change

Nonaccrual loans


$     356,772

$     403,392

(11.6%)


$     467,611

$     488,321

$     574,356

(37.9%)

Other real estate owned (OREO)


41,571

42,076

(1.2%)


45,712

49,019

44,330

(6.2%)

   Total nonperforming assets


$     398,343

$     445,468

(10.6%)


$     513,323

$     537,340

$     618,686

(35.6%)











Loans 90 or more days past due and still accruing


4,925

1,220

303.7%


12,123

9,380

3,418

44.1%

Restructured loans (accruing)


113,164

113,083

0.1%


100,343

88,193

79,935

41.6%











Allowance for loan losses / loans


2.70%

2.96%



3.25%

3.59%

3.78%


Allowance for loan losses / nonaccrual loans


105.99

99.09



91.09

93.07

83.02


Nonaccrual loans / total loans


2.54

2.99



3.57

3.86

4.55


Nonperforming assets / total loans plus OREO


2.83

3.29



3.91

4.23

4.89


Nonperforming assets / total assets


1.82

2.03



2.33

2.50

2.84


Net charge offs / average loans (annualized)


0.64

0.90



1.37

1.71

3.41


Year-to-date net charge offs / average loans


1.13

1.32



1.54

1.71

3.69












Nonaccrual loans by type:










Commercial and industrial


$       56,075

$       61,256

(8.5%)


$       71,183

$       76,780

$       99,845

(43.8%)

Commercial real estate - owner occupied


35,718

47,202

(24.3%)


59,725

57,168

59,317

(39.8%)

Lease financing


10,644

11,667

(8.8%)


12,898

15,270

17,080

(37.7%)

 Commercial and business lending


102,437

120,125

(14.7%)


143,806

149,218

176,242

(41.9%)

Commercial real estate - investor


99,352

97,691

1.7%


133,770

129,379

164,610

(39.6%)

Real estate - construction


41,806

72,300

(42.2%)


72,782

84,903

94,929

(56.0%)

 Commercial real estate lending


141,158

169,991

(17.0%)


206,552

214,282

259,539

(45.6%)

   Total commercial


243,595

290,116

(16.0%)


350,358

363,500

435,781

(44.1%)

Home equity


46,907

46,119

1.7%


46,777

49,618

51,712

(9.3%)

Installment


2,715

3,195

(15.0%)


3,724

4,949

10,544

(74.3%)

   Total retail


49,622

49,314

0.6%


50,501

54,567

62,256

(20.3%)

   Residential mortgage


63,555

63,962

(0.6%)


66,752

70,254

76,319

(16.7%)

       Total nonaccrual loans


$     356,772

$     403,392

(11.6%)


$     467,611

$     488,321

$     574,356

(37.9%)











* Annualized.

(1) Charge offs for the three months ended March 31, 2011, include $10 million of write-downs related to installment loans transferred to held for sale.



Selected Asset Quality Information (continued) 

Associated Banc-Corp





Dec11 vs Sep11





Dec11 vs Dec10

(in thousands)


Dec 31, 2011

Sep 30, 2011

% Change


Jun 30, 2011

Mar 31, 2011

Dec 31, 2010

% Change

Restructured loans (accruing)










Commercial and industrial


$       22,552

$       23,020

(2.0%)


$       22,760

$       16,047

$         9,980

126.0%

Commercial real estate - owner occupied


8,138

5,439

49.6%


1,579

382

382

N/M

Lease financing


-

-

0.0%


-

-

-

0.0%

 Commercial and business lending


30,690

28,459

7.8%


24,339

16,429

10,362

196.2%

Commercial real estate - investor


43,417

43,453

(0.1%)


34,612

33,784

15,230

185.1%

Real estate - construction


10,977

10,707

2.5%


10,706

7,859

22,532

(51.3%)

 Commercial real estate lending


54,394

54,160

0.4%


45,318

41,643

37,762

44.0%

   Total commercial


85,084

82,619

3.0%


69,657

58,072

48,124

76.8%

Home equity


8,950

10,556

(15.2%)


11,453

11,630

11,741

(23.8%)

Installment


1,015

965

5.2%


1,017

1,149

692

46.7%

   Total retail


9,965

11,521

(13.5%)


12,470

12,779

12,433

(19.9%)

   Residential mortgage


18,115

18,943

(4.4%)


18,216

17,342

19,378

(6.5%)

       Total restructured loans (accruing)


$     113,164

$     113,083

0.1%


$     100,343

$       88,193

$       79,935

41.6%











Restructured loans in nonaccrual loans (not included above)


$       87,493

$       80,063

9.3%


$       71,084

$       49,352

$       35,939

143.4%





















Loans Past Due 30-89 Days




Dec11 vs Sep11





Dec11 vs Dec10



Dec 31, 2011

Sep 30, 2011

% Change


Jun 30, 2011

Mar 31, 2011

Dec 31, 2010

% Change

Commercial and industrial


$         8,743

$         6,255

39.8%


$         7,581

$       36,205

$       33,013

(73.5%)

Commercial real estate - owner occupied


7,092

29,409

(75.9%)


33,753

21,820

9,295

(23.7%)

Lease financing


104

507

(79.5%)


79

135

132

(21.2%)

 Commercial and business lending


15,939

36,171

(55.9%)


41,413

58,160

42,440

(62.4%)

Commercial real estate - investor


4,970

70,136

(92.9%)


27,487

18,717

37,191

(86.6%)

Real estate - construction


996

5,493

(81.9%)


13,217

3,410

8,016

(87.6%)

 Commercial real estate lending


5,966

75,629

(92.1%)


40,704

22,127

45,207

(86.8%)

   Total commercial


21,905

111,800

(80.4%)


82,117

80,287

87,647

(75.0%)

Home equity


12,189

18,165

(32.9%)


14,818

14,808

13,886

(12.2%)

Installment


2,592

1,956

32.5%


3,851

2,714

9,624

(73.1%)

   Total retail


14,781

20,121

(26.5%)


18,669

17,522

23,510

(37.1%)

   Residential mortgage


7,224

12,114

(40.4%)


12,573

7,940

8,722

(17.2%)

       Total loans past due 30-89 days


$       43,910

$     144,035

(69.5%)


$     113,359

$     105,749

$     119,879

(63.4%)





















Potential Problem Loans




Dec11 vs Sep11





Dec11 vs Dec10



Dec 31, 2011

Sep 30, 2011

% Change


Jun 30, 2011

Mar 31, 2011

Dec 31, 2010

% Change

Commercial and industrial


$     153,306

$     207,351

(26.1%)


$     229,407

$     348,949

$     354,284

(56.7%)

Commercial real estate - owner occupied


136,366

140,406

(2.9%)


145,622

172,662

193,819

(29.6%)

Lease financing


158

507

(68.8%)


1,399

1,705

2,617

(94.0%)

 Commercial and business lending


289,830

348,264

(16.8%)


376,428

523,316

550,720

(47.4%)

Commercial real estate - investor


230,206

252,331

(8.8%)


236,434

292,714

298,959

(23.0%)

Real estate - construction


27,649

37,155

(25.6%)


63,186

70,824

91,618

(69.8%)

 Commercial real estate lending


257,855

289,486

(10.9%)


299,620

363,538

390,577

(34.0%)

   Total commercial


547,685

637,750

(14.1%)


676,048

886,854

941,297

(41.8%)

Home equity


5,451

4,975

9.6%


4,515

4,737

3,057

78.3%

Installment


233

272

(14.3%)


216

230

703

(66.9%)

   Total retail


5,684

5,247

8.3%


4,731

4,967

3,760

51.2%

   Residential mortgage


13,037

16,550

(21.2%)


18,575

19,710

18,672

(30.2%)

       Total potential problem loans


$     566,406

$     659,547

(14.1%)


$     699,354

$     911,531

$     963,729

(41.2%)











N/M - Not meaningful.



Net Interest Income Analysis - Taxable Equivalent Basis









Associated Banc-Corp


Year ended December 31, 2011


Year ended December 31, 2010



Average
Balance

Interest
Income / Expense

Average
Yield / Rate


Average
Balance

Interest
Income / Expense

Average
Yield / Rate

(in thousands)












Earning assets:









  Loans: (1) (2) (3)









     Commercial


$   7,274,728

$               315,151

4.33%


$   7,790,554

$               339,595

4.36%

     Residential mortgage


2,819,702

116,207

4.12


2,059,156

99,163

4.82

     Retail


3,184,418

154,793

4.86


3,337,002

173,015

5.18

        Total loans


13,278,848

586,151

4.41


13,186,712

611,773

4.64

     Investment securities


5,497,297

171,270

3.12


5,439,729

209,295

3.85

     Other short-term investments


666,118

5,575

0.84


1,942,054

8,693

0.45

  Investments and other


6,163,415

176,845

2.87


7,381,783

217,988

2.95

Total earning assets


19,442,263

762,996

3.92


20,568,495

829,761

4.03

  Other assets, net


2,146,357




2,056,570



Total assets


$ 21,588,620




$ 22,625,065












Interest-bearing liabilities:









  Savings deposits


$      987,198

$                   1,091

0.11%


$      898,019

$                   1,176

0.13%

  Interest-bearing demand deposits


1,947,506

3,429

0.18


2,780,525

6,314

0.23

  Money market deposits


5,147,437

16,385

0.32


6,374,071

33,417

0.52

  Time deposits, excluding Brokered CDs


2,647,632

41,257

1.56


3,251,667

60,280

1.85

     Total interest-bearing deposits, excluding Brokered CDs


10,729,773

62,162

0.58


13,304,282

101,187

0.76

  Brokered CDs


290,226

3,586

1.24


547,328

4,836

0.88

     Total interest-bearing deposits


11,019,999

65,748

0.60


13,851,610

106,023

0.77

  Short and long-term funding


4,100,825

63,043

1.54


2,452,610

66,324

2.70

Total interest-bearing liabilities


15,120,824