April 17, 2001
LAKELAND FINANCIAL REPORTS THIRD QUARTER PERFORMANCE AND CASH DIVIDEND
Warsaw, Indiana (April 17, 2001) - Lakeland Financial Corporation (Nasdaq/LKFN), parent company of Lake City Bank, today reported net income of $2.1 million for the first quarter of 2001 versus $2.2 million for the first quarter of 2000. Diluted net income per common share for the first quarter of 2001 was $0.37 versus $0.38 for the first quarter of 2000.
The Company announced that the Board of Directors approved a cash dividend for the first quarter of $0.15 per share, payable on April 25, 2001 to shareholders of record on April 10, 2001. This dividend represents an increase of 15% over the quarterly dividend that was paid in each quarter of 2000.
Michael L. Kubacki, President and Chief Executive Officer, commented on the performance, "Our strong focus on floating rate commercial lending made us highly susceptible to the adverse effects of the 1.50% reduction in the Bank's prime rate which resulted from corresponding rate cuts by the Federal Reserve Bank during the quarter. While lower rates are good for our customers, and are expected to have a positive long-term impact to the economy, the short-term result is a compression of our profit margin on this business. Overall, the Company's net interest margin decreased 24 basis points from 3.73% in the first quarter of 2000 to 3.49% in the comparable period in 2001. As the interest rate environment stabilizes, we expect to see a recovery in our net interest margin in future quarters."
Kubacki continued, "We experienced outstanding growth in fee income during the quarter led by a 44% increase in trust and brokerage fees, which totaled $794,000 for the quarter. Total noninterest income for the quarter increased 6.8% versus the comparable period in 2000. During the quarter, the Company incurred a charge of nearly $200,000 related to the non-cash impairment of the Bank's mortgage servicing rights which resulted directly from the decline in interest rates. Excluding this charge, noninterest income would have increased 14% in the first quarter versus the same period in 2000."
Kubacki further commented, "Total noninterest expense was $8.1 million in the quarter versus $7.6 million in the same period in 2000. Overall expense control was in-line with our expectations. After an increase in total noninterest expense of less than 1% in 2000, we had anticipated some general increases in 2001."
Lakeland Financial's allowance for loan losses as of March 31, 2001 was $7.2 million, or 1.01% of gross loans, compared to $6.7 million, or 1.01% of gross loans, as of March 31, 2000. The ratio of non-performing assets to loans was 0.54% on March 31, 2001 compared to 0.24% on March 31, 2000 and 1.37% as of year-end 2000.
Kubacki commented, "While we continue to be concerned with ongoing signs of economic weakness in the markets we serve, we are pleased that we were able to improve on the strength of our asset quality during the quarter. We will cautiously maintain our focus on commercial loan growth coupled with a continued emphasis on our historical credit standards."
As of March 31, 2001, Lakeland Financial's equity-to-assets ratio was 6.2%, compared to 5.2% in the year ago quarter. Shareholders' equity was $68 million versus $55 million as of March 31, 2000, an increase of 23.5%. Total assets at the conclusion of the first quarter of 2001 were $1.10 billion versus $1.05 billion as of March 31, 2000, an increase of 4.7%. Total loans for the first quarter of 2001 increased 8.1% from $661 million to $715 million and total deposits increased 6.1% percent from $794 million to $842 million over the comparable figures at the end of the first quarter of 2000.
Lakeland Financial Corporation is a $1.1 billion bank holding company headquartered in Warsaw, Indiana. Lake City Bank has 43 branches located in the following Indiana counties: Kosciusko, Elkhart, Allen, St. Joseph, Cass, Fulton, Howard, Huntington, LaGrange, Marshall, Miami, Noble, Pulaski, Whitley and Wabash.
Lakeland Financial Corporation may be accessed on its home page at www.lakecitybank.com. The Company's common stock is traded on the Nasdaq Stock Market under "LKFN". Marketmakers in Lakeland Financial Corporation common shares include Stifel Nicolaus & Company, Raymond James & Associates, Inc., McDonald Investments, Inc. and First Tennessee Capital Markets.
The Company's fixed rate cumulative trust preferred securities are traded on the Nasdaq stock market under the symbols "LKFNP". The annual rate on the fixed rate securities is 9.0%.
This release may contain forward-looking statements. Forward looking statements are identifiable by the inclusion of such qualifications as expects, intends, believes, may, likely or similar statements or variations of such terms which express views concerning trends and the future. These forward looking statements are not historical facts and instead they are expressions about management's confidence and strategies and management's expectations about new and existing programs and products, relationships, opportunities, technology and market conditions. Actual events and results may differ significantly from those described in such forward looking statements, due to changes in general economic or market conditions, government regulation, competition or other factors. For additional information about these factors, please review our filings with the Securities and Exchange Commission. |
