South Bend-based 1st Source Corp. (Nasdaq: SRCE) is reporting record full-year net income of more than $58 million in 2014, compared to nearly $55 million in 2013. The parent company of 1st Source Bank opened two Fort Wayne branches last year. January 21, 2015
SOUTH BEND, Ind. – 1st Source Corporation (NASDAQ: SRCE), parent company of 1st Source Bank, today announced record net income of $58.07 million for the year of 2014, a 5.66% increase over the $54.96 million in 2013. The annual net income is the highest in company history. Fourth quarter net income was $15.00 million, up 9.33% compared to $13.72 million in the fourth quarter of 2013.
Diluted net income per common share for the year was $2.39, another all-time record and an increase of 7.17% over the $2.23 per common share a year earlier. Diluted net income per common share for the fourth quarter was $0.62, up 10.71% compared to $0.56 per common share reported in the fourth quarter of the previous year.
At its January 2015 meeting, the 1st Source Board of Directors approved a cash dividend of $0.18 per common share. The cash dividend is payable on February 13, 2015 to shareholders of record on February 3, 2015. Dividends for 2014 increased 4.41% over the previous year.
According to Christopher J. Murphy, III, Chairman, “I am pleased to report a steady fourth quarter and another solid year for 1st Source Corporation. We achieved record earnings yet again and continued our streak of 27 years of consecutive dividend growth. It was also a year of celebration, as we began our 151st year of helping clients achieve security, build wealth and realize their dreams. We increased our primary client relationships in all of our markets. We were also able to decrease our nonperforming assets and grow our loan and lease outstandings by almost $140 million during the year, while reducing our exposure to some more risk challenged markets.”
“We ended the year having refurbished six banking centers and opening two new ones in Fort Wayne, Indiana. The grand openings marked the completion of an $8 million investment in that market, the second largest city in Indiana. This allows us to increase our market share in an attractive market and provide a level of convenience and service previously not available,” Murphy concluded.
Total assets at the end of 2014 were $4.83 billion, up 2.27% from the same period last year. Total loans and leases at December 31, 2014 were $3.69 billion, up 3.92%, and total deposits at December 31, 2014 were $3.80 billion, up 4.08% from the same period last year. As of December 31, 2014, the common equity-to-assets ratio was 12.72%, compared to 12.39% at December 31, 2013 and the tangible common equity-to-tangible assets ratio was 11.15% at December 31, 2014 compared to 10.76% at December 31, 2013.
The net interest margin was 3.61% for the fourth quarter of 2014 versus 3.59% for the same period in 2013. The net interest margin was 3.59% for the year ending December 31, 2014 versus 3.67% for the year ending December 31, 2013. Tax-equivalent net interest income was $41.29 million for the fourth quarter of 2014, up 4.53% compared to $39.50 million for 2013’s fourth quarter. For the twelve months of 2014, tax-equivalent net interest income was $162.17 million, up 2.22% compared to $158.64 million for the twelve months of 2013.
Reserve for loan and lease losses as of December 31, 2014 was 2.31% of total loans and leases, compared to 2.35% as of December 31, 2013. Net charge-offs were $1.51 million for the fourth quarter 2014, compared to $0.14 million in the fourth quarter 2013. Net charge-offs for the full year were $2.17 million in 2014 compared to $0.58 million in 2013. There was a recovery of provision for loan and lease losses of $0.82 million in the fourth quarter of 2014, compared with $0.86 million for the same period in 2013. For the twelve months of 2014, the provision for loan and lease losses was $3.73 million compared with $0.77 million for the twelve months of 2013. The ratio of nonperforming assets to net loans and leases was 1.13% on December 31, 2014, compared to 1.29% on December 31, 2013.
Noninterest income for the fourth quarter of 2014 was $19.88 million, up 10.51% compared to $17.99 million for the fourth quarter of 2013. The fourth quarter increase was primarily a result of higher trust fees, increased equipment rental income and higher debit card income. For the year, noninterest income was $77.89 million, up slightly from $77.21 million in 2013.
Noninterest expense for the fourth quarter of 2014 was $41.99 million, up 8.81% compared to $38.59 million for the fourth quarter of 2013. The leading factors for the fourth quarter increase were higher salary and employee benefits expense, other expenses, depreciation on leased equipment, business development and marketing expenses, loan and lease collection and repossession expenses and professional fees. For the year ending December 31, 2014, noninterest expense was $150.04 million, up slightly from $149.31 million one year ago.
The provision for income taxes included a one-time benefit of $2.12 million and $3.30 million for the three and twelve months ended December 31, 2014, respectively, which resulted in a lower effective tax rate. These benefits were the result of a reduction in uncertain tax positions due to settlements with taxing authorities and the lapse of the applicable statute of limitations.
1st Source common stock is traded on the NASDAQ Global Select Market under “SRCE” and appears in the National Market System tables in many daily newspapers under the code name “1st Src.” Since 1863, 1st Source has been committed to the success of the communities it serves. For more information, visit www.1stsource.com.
1st Source serves the northern half of Indiana and southwest Michigan and is the largest locally controlled financial institution headquartered in the area. While delivering a comprehensive range of consumer and commercial banking services through its community bank offices, 1st Source has distinguished itself with highly personalized services. 1st Source Bank also competes for business nationally by offering specialized financing services for new and used private and cargo aircraft, automobiles for leasing and rental agencies, medium and heavy duty trucks, construction and environmental equipment. The Corporation includes 80 community banking centers in 17 counties, 9 trust and wealth management locations, 8 1st Source Insurance offices, as well as 21 specialty finance locations nationwide.
Source: 1st Source Corp