July 18, 2001
LAKELAND FINANCIAL REPORTS SECOND QUARTER AND YEAR TO DATE PERFORMANCE AND CASH DIVIDEND
Warsaw, Indiana (July 18, 2001) - Lakeland Financial Corporation (NASDAQ/LKFN), parent company of Lake City Bank, today reported net income of $2.4 million for the second quarter of 2001 versus $2.5 million for the comparable period in 2000. Diluted net income per common share for the second quarter of 2001 was $0.41 versus $0.43 for the comparable period in 2000. Net income for the six months ended June 30, 2001 was $4.5 million, or $0.78 per diluted share, versus $4.7 million, or $0.81 per diluted share, in the comparable period in 2000.
The Company announced that the Board of Directors approved a cash dividend for the second quarter of $0.15 per share, payable on July 25, 2001 to shareholders of record on July 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, "The downward pressure on our net interest margin during the second quarter continued to mask the strong overall performance of the Company in 2001. With additional reductions of 1.50% in the Bank's prime rate during the quarter, which brings the total reductions for the year to 3.00%, the Company's susceptibility to declining interest rates was further demonstrated. Our net interest margin for the second quarter was 3.59% versus 3.84% in 2000 and 3.54% for the first six months of 2001 versus 3.77% for the same period in 2000."
"Despite the additional reductions by the Federal Reserve Bank during the quarter, we did see an improvement in the net interest margin during the second quarter of 2001 compared to the first quarter. Our net interest margin improved to 3.59% in the second quarter from 3.48% in the first quarter. We believe that if interest rates stabilize and further rate reductions are minimal, this improvement should continue for the balance of 2001," added Kubacki.
Kubacki continued, "Our noninterest income, driven by strong increases in gains from the sale of mortgages and higher service charges, increased 13% from $2.5 million in the second quarter of 2000 to $2.9 million in 2001. For the six months ended June 30, 2001, total noninterest income increased 14% from $5.1 million to $5.8 million with significant gains in trust and brokerage fees and service charges. The Company has incurred non-cash charges through the first six months against noninterest income of approximately $295,000 related to the impairment of the Bank's mortgage servicing rights, which resulted directly from the decline in interest rates. Excluding these non-cash charges, noninterest income would have increased 17% and 19%, respectively, in the second quarter and six months versus the same periods in 2000."
Lakeland Financial's allowance for loan losses as of June 30, 2001 was $7.4 million, or 1.00% of gross loans, compared to $7.0 million, or 1.03% of gross loans, as of June 30, 2000. The ratio of non-performing assets to loans was 0.61% on June 30, 2001 compared to 0.24% on June 30, 2000 and 1.37% as of year-end 2000.
Kubacki commented, "In a very challenging economic environment, we continue to be satisfied with the overall quality of the loan portfolio. We are closely monitoring the impact that the weakness in our regional economy has on our customers and have adjusted our strategy appropriately."
For the six months ended June 30, 2001, Lakeland Financial's equity-to-average assets ratio was 6.24% compared to 5.45% for the same period in 2000. Shareholders' equity was $69.6 million versus $56.7 million as of June 30, 2000, an increase of 23%. Total assets at the conclusion of the second quarter of 2001 increased 7% to $1.2 billion from $1.1 billion as of June 30, 2000. Average loans for the six months ended June 30, 2001 were $721 million versus $667 during the comparable period in 2000, an increase of 8%. Average total deposits for the six months ended June 30, 2001 increased 9% percent from $770 million to $840 million versus the comparable period in 2000.
Lakeland Financial Corporation is a $1.2 billion bank holding company headquartered in Warsaw, Indiana. Lake City Bank has 44 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. |
