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First Community Bancshares, Inc. Announces Fourth Quarter and Full Year 2012 Results and Quarterly Cash Dividend to Common



First Community Bancshares, Inc. Announces Fourth Quarter and Full Year 2012
Results and Quarterly Cash Dividend to Common Stockholders

BLUEFIELD, Va., Feb. 1, 2013 (GLOBE NEWSWIRE) -- First Community Bancshares,
Inc. (Nasdaq:FCBC) (www.fcbinc.com) (the "Company") today reported net income
for the quarter and twelve months ended December 31, 2012, of $8.44 million
and $28.58 million, respectively. Net income available to common shareholders
totaled $8.17 million, or $0.39 per diluted common share, for the quarter
ended December 31, 2012. Net income available to common shareholders totaled
$27.52 million, or $1.40 per diluted common share, for the twelve months ended
December 31, 2012. Net income for the quarter and twelve months ended December
31, 2012, was impacted by $857 thousand and $5.08 million, respectively, in
merger related expenses. Excluding nonrecurring income and expense items, core
earnings for the quarter and twelve months ended December 31, 2012, totaled
$8.78 million and $30.47 million, respectively.

On January 22, 2013, the Company announced that the board of directors
declared a quarterly cash dividend to common shareholders of twelve cents
($0.12) per common share. The quarterly dividend is payable to common
shareholders of record on February 8, 2013, and is expected to be paid on or
about February 22, 2013. The current dividend represents an increase of 20%
over the dividend paid during the same quarter of 2012. The current year marks
the 28^th consecutive year of cash dividends to shareholders.

Fourth Quarter 2012 Highlights –

  * Core earnings were $8.78 million for the fourth quarter of 2012, an
    increase of $3.82 million, or 77.04%, compared with the fourth quarter of
    2011.
  * Core return on average assets was 1.28% and core return on average
    tangible common equity was 15.10% for the fourth quarter of 2012.
  * Core return on average assets was 1.21% and core return on average
    tangible common equity was 13.95% for the year ended December 31, 2012.
  * Loans held for investment increased $328.38 million, or 23.52%, compared
    with the fourth quarter of 2012.
  * The tax equivalent net interest margin increased 56 basis points to 4.49%
    for the fourth quarter of 2012 compared with the fourth quarter of 2011.
  * Net interest income was $26.14 million, an increase of $7.87 million, or
    43.09%, compared with fourth quarter 2011.
  * Cash dividends paid per common share increased 7.5% for the year ended
    December 31, 2012, compared with the year ended December 31, 2011.

Net Interest Income

Net interest income increased $7.87 million, or 43.09%, to $26.14 million for
the fourth quarter of 2012 compared with the fourth quarter of 2011. The tax
equivalent net interest margin increased 56 basis points to 4.49% for the
fourth quarter of 2012 compared with 3.93% for the fourth quarter of 2011.
Total interest income increased $8.06 million, or 34.72%, to $31.26 million
for the fourth quarter of 2012 compared with the fourth quarter of 2011. The
increase reflects the increases in loan portfolio balances from the
acquisitions of Peoples Bank of Virginia ("Peoples") and Waccamaw Bank
("Waccamaw") during the second quarter of 2012. The tax equivalent yield on
loans increased to 6.43% while the average loan balance increased $352.93
million, or 25.34%, to $1.75 billion for the fourth quarter of 2012 compared
with the fourth quarter of 2011.

Total interest expense increased $185 thousand, or 3.75%, to $5.12 million for
the fourth quarter of 2012 compared with the fourth quarter of 2011. Deposit
costs decreased $33 thousand, or 1.25%, to $2.60 million for the fourth
quarter of 2012 compared with the fourth quarter of 2011, which was primarily
due to an 18 basis point decrease in the average rate paid on interest-bearing
deposits. Borrowing costs increased $218 thousand, or 9.49%, to $2.52 million
for the fourth quarter of 2012 compared with the fourth quarter of 2011. The
average rate paid on interest-bearing liabilities decreased 20 basis points to
1.01% for the fourth quarter of 2012 compared with the fourth quarter of 2011.
The average balance of interest-bearing liabilities increased $399.15 million,
or 24.71%, to $2.01 billion for the fourth quarter of 2012 compared with the
fourth quarter of 2011, which included a $379.81 million increase in average
interest-bearing deposits and a $19.34 million increase in average total
borrowings. The increases were primarily the result of the Peoples and
Waccamaw acquisitions that occurred during the second quarter of 2012.

Provision for Loan Losses

The provision for loan losses for the fourth quarter of 2012 decreased $1.22
million, or 49.92%, to $1.22 million, compared with the same period of the
prior year. Provision for the twelve months of 2012 decreased $3.37 million,
or 37.24%, to $5.68 million, compared with the same period of the prior year.
The fourth quarter of 2012 marks the ninth consecutive quarter of provision
decreases when compared to the prior year's comparable quarter.

Noninterest Income

Noninterest income increased $1.64 million, or 24.84%, to $8.25 million for
the fourth quarter of 2012 compared with the fourth quarter of 2011. The
Company realized a $316 thousand net gain on sale of securities for the fourth
quarter of 2012, which was an increase of $290 thousand, or 11.15%, compared
to the fourth quarter of 2011. Wealth management revenues increased $44
thousand, or 5.38%, for the fourth quarter of 2012 compared with the fourth
quarter of 2011. The Trust and Wealth Management Divisions reported $876
million in assets under management as of December 31, 2012. Service charges on
deposit accounts increased $376 thousand, or 10.90%, for the fourth quarter of
2012 compared with the fourth quarter of 2011, which are attributable to the
addition of Waccamaw. Insurance commissions increased $45 thousand, or 3.85%,
to $1.22 million for the fourth quarter of 2012 compared with the same quarter
of 2011. The Company incurred no other-than-temporary impairment charges for
the fourth quarter of 2012 compared to $1.55 million recorded for the fourth
quarter of 2011.

Noninterest Expense

Noninterest expense increased $3.71 million, or 21.77%, to $20.77 million for
the fourth quarter of 2012 compared with the fourth quarter of 2011, due
largely to the Peoples and Waccamaw acquisitions. Salaries and employee
benefits increased $2.79 million, or 35.30%, to $10.69 million for the fourth
quarter of 2012 compared with the fourth quarter of 2011. The Peoples and
Waccamaw acquisitions accounted for an increase in salaries and employee
benefits of $665 thousand and $1.22 million, respectively, during the fourth
quarter of 2012. Occupancy, furniture, and equipment expense increased $949
thousand, or 39.66%, to $3.34 million for the fourth quarter of 2012 compared
with the fourth quarter of 2011. During the fourth quarter of 2012, the
Company incurred merger related expenses of $857 thousand in connection with
the acquisition of Peoples and Waccamaw. Other operating expense increased
$446 thousand, or 9.06%, to $5.37 million for the fourth quarter of 2012
compared with the fourth quarter of 2011. Other operating expense included a
net loss on sales and expenses associated with other real estate owned of $312
thousand for the fourth quarter of 2012 compared to $455 thousand for the
fourth quarter of 2011. The efficiency ratio for the fourth quarter of 2012
was 56.38% compared to 56.73% for the fourth quarter of 2011.

Allowance for Loan Losses and Credit Quality on Non-covered Loans

Non-covered loans and other real estate owned are those assets not covered by
the loss share agreement between the FDIC and the Bank in relation to the
acquisition of Waccamaw. The allowance for loan losses on non-covered loans
decreased to $25.77 million at December 31, 2012, compared with $26.21 million
at December 31, 2011. The allowance for loan losses for non-covered loans as a
percentage of non-covered loans decreased to 1.70% at December 31, 2012,
compared with 1.88% at December 31, 2011. The decrease in the ratio of
allowance for loan losses for non-covered loans as a percentage of non-covered
loans for the fourth quarter of 2012 was impacted by loans marked to fair
value as part of the Peoples' acquisition. For the fourth quarter of 2012, net
charge-offs decreased $1.35 million, or 51.29%, compared with the fourth
quarter of 2011. Annualized net charge-offs as a percentage of average
non-covered loans were 0.33% for the fourth quarter of 2012, which represents
a decrease compared with 0.76% for the fourth quarter of 2011.

Non-covered delinquent loans, comprised of loans 30 days or more past due and
nonaccrual loans, as a percentage of total non-covered loans measured 2.57% at
December 31, 2012, compared to 2.63% for the same period of the prior year.
Non-covered nonaccrual loans decreased to $23.93 million at December 31, 2012,
compared with $24.49 million at December 31, 2011. At quarter end, the
Company's non-covered nonperforming loans as a percentage of total non-covered
loans were 1.89% and non-covered nonperforming assets as a percentage of total
non-covered assets were 1.37%, down from 1.43% for the same period of the
prior year. Nonperforming assets included $4.73 million in unseasoned,
accruing troubled debt restructurings and $9.00 million in other real estate
owned, of which $3.26 million was covered under the loss share agreement, at
December 31, 2012.

Balance Sheet and Capital

Consolidated assets totaled $2.73 billion as of December 31, 2012, an increase
of $566.31 million, or 26.16%, compared with $2.16 billion at December 31,
2011. Consolidated liabilities totaled $2.37 billion as of December 31, 2012,
an increase of $515.56 million, or 27.73%, compared with $1.86 billion at
December 31, 2011. Total stockholders' equity increased to $356.47 million as
of December 31, 2012, compared with $305.73 million at December 31, 2011. Book
value per as-converted common share increased to $16.80 for the quarter ended
December 31, 2012, compared with $15.96 for the quarter ended December 31,
2011. Tangible book value per common share increased $0.19 to $11.59 compared
with the fourth quarter of 2011. During the fourth quarter of 2012, the
Company paid a cash dividend of $0.11 per common share.

The Company significantly exceeds regulatory "well capitalized" targets as of
December 31, 2012, with a total risk-based capital ratio of 16.6%, Tier 1
risk-based capital ratio of 15.4%, and a Tier 1 leverage ratio of 9.9%.

Non-GAAP Financial Measures

The Company prepares its financial statements in accordance with generally
accepted accounting principles in the United States ("GAAP"). This press
release also refers to certain non-GAAP financial measures that the Company
believes provide investors with important information, when used in
conjunction with results presented in accordance with GAAP, regarding our
operational performance.

Core earnings are a non-GAAP financial measure that excludes certain items
from net income. Excluded items include gains, losses, and impairment losses
on securities; goodwill and intangible impairment; amortization of
intangibles; taxes; and other nonrecurring income and expense items.
Management believes that core earnings provide the Company and investors a
valuable tool to evaluate the Company's financial results.

The efficiency ratio is a non-GAAP financial measure that is computed by
dividing adjusted noninterest expense by the sum of tax equivalent net
interest income and adjusted noninterest income. Management believes this
measure provides investors with important information about the Company's
operating expense control and efficiency of operations. Management also
believes this ratio focuses attention on the core operating performance of the
Company over time and is highly useful in comparing period-to-period operating
performance of core business operations. The efficiency ratio used by the
Company may not be comparable to efficiency ratios reported by other financial
institutions.

Tangible book value per common share is a non-GAAP financial measure that is
defined as stockholders' equity less goodwill and other intangibles, divided
by as-converted common shares outstanding. Average tangible common equity is a
non-GAAP financial measure that is defined as average stockholders' equity
less average goodwill, other intangibles, and the preferred liquidation
preference.

Investor Relations

The Company will host an investor and media teleconference and webcast on
Friday, February 1, 2013, at 11:00 a.m. To access the teleconference, the
toll-free number is (877) 407-8033. Individuals may listen to the live or
archived webcast of the conference call. To listen to the webcast, visit
www.fcbinc.com and follow the link under the Investor Relations section. The
Company's press release and financial summary will be available in this
section, as well. Copies of the Company's fourth quarter 2012 earnings press
release and financial summary will be made available upon request via fax,
email, or postal service mail. To request a copy, contact David D. Brown,
Chief Financial Officer, at (276) 326-9000.

About First Community Bancshares, Inc.

First Community Bancshares, Inc., headquartered in Bluefield, Virginia, is a
$2.73 billion financial holding company and the parent company of First
Community Bank. First Community Bank operates seventy-two banking locations
throughout Virginia, West Virginia, North Carolina, South Carolina, and
Tennessee. First Community Bank offers wealth management and investment
services through its Trust Division and First Community Wealth Management, a
registered investment advisory firm. The Trust Division and First Community
Wealth Management managed assets with a market value of $876 million as of
December 31, 2012. The Company is also the parent company of Greenpoint
Insurance Group, Inc., a full-service insurance agency headquartered in High
Point, North Carolina, that operates six insurance offices throughout
Virginia, West Virginia, and North Carolina. The Company's common stock is
traded on the NASDAQ Global Select Market under the symbol, "FCBC." Additional
investor information can be found on the Company's website at www.fcbinc.com.

The First Community Bancshares, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=6960

This news release may include forward-looking statements. These
forward-looking statements are based on current expectations that involve
risks, uncertainties, and assumptions. Should one or more of these risks or
uncertainties materialize or should underlying assumptions prove incorrect,
actual results may differ materially. These risks include: changes in business
or other market conditions; the timely development, production and acceptance
of new products and services; the challenge of managing asset/liability
levels; the management of credit risk and interest rate risk; the difficulty
of keeping expense growth at modest levels while increasing revenues; and
other risks detailed from time to time in the Company's Securities and
Exchange Commission reports including, but not limited to, the Annual Report
on Form 10-K for the most recent year ended. Pursuant to the Private
Securities Litigation Reform Act of 1995, the Company does not undertake to
update forward-looking statements to reflect circumstances or events that
occur after the date the forward-looking statements are made.

FIRST COMMUNITY BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
                                                                    
                               Three Months Ended      Year Ended
                               December 31,            December 31,
(Amounts in thousands, except  2012        2011        2012        2011
share and per share data)
Interest income                                                     
Interest and fees on loans      $ 28,188    $ 19,947    $ 96,684    $ 80,580
held for investment
Interest on securities ---      1,770       2,023       7,830       8,117
taxable
Interest on securities ---      1,216       1,190       4,883       5,194
nontaxable
Interest on deposits in banks   82          41          259         285
Total interest income           31,256      23,201      109,656     94,176
Interest expense                                                    
Interest on deposits            2,604       2,637       9,972       12,788
Interest on short-term          656         603         2,515       2,475
borrowings
Interest on long-term           1,860       1,695       7,113       6,884
borrowings
Total interest expense          5,120       4,935       19,600      22,147
Net interest income             26,136      18,266      90,056      72,029
Provision for loan losses       1,220       2,436       5,678       9,047
Net interest income after       24,916      15,830      84,378      62,982
provision for loan losses
Noninterest income                                                  
Wealth management income        862         818         3,701       3,510
Service charges on deposit      3,826       3,450       14,063      13,238
accounts
Other service charges and fees  1,682       1,429       6,462       5,722
Insurance commissions           1,215       1,170       5,743       6,197
Net impairment losses           --          (1,548)     (942)       (2,285)
recognized in earnings
Net gain on sale of securities  316         26          586         5,264
Other operating income          346         1,261       6,131       3,888
Total noninterest income        8,247       6,606       35,744      35,534
Noninterest expense                                                 
Salaries and employee benefits  10,693      7,903       38,667      34,126
Occupancy expense of bank       1,938       1,589       6,872       6,280
premises
Furniture and equipment         1,404       804         4,145       3,490
Amortization of intangible      191         250         804         1,020
assets
FDIC premiums and assessments   313         344         1,536       1,984
FHLB debt prepayment fees       --          --          --          471
Merger related expense          857         --          5,084       --
Goodwill impairment             --          1,239       --          1,239
Other operating expense         5,371       4,925       20,309      20,305
Total noninterest expense       20,767      17,054      77,417      68,915
Income before income taxes      12,396      5,382       42,705      29,601
Income tax expense              3,957       2,151       14,128      9,573
Net income                      8,439       3,231       28,577      20,028
Dividends on preferred stock    272         286         1,058       703
Net income available to common  $ 8,167     $ 2,945     $ 27,519    $ 19,325
shareholders
                                                                    
Basic earnings per common       $ 0.41      $ 0.16      $ 1.44      $ 1.08
share 
Diluted earnings per common     $ 0.39      $ 0.17      $ 1.40      $ 1.07
share 
Cash dividends per common       $ 0.11      $ 0.10      $ 0.43      $ 0.40
share
                                                                    
Weighted average basic shares   20,058,998  17,849,286  19,125,839  17,877,421
outstanding
Weighted average diluted        21,373,669  19,159,090  20,480,172  18,691,081
shares outstanding
                                                                    
Return on average assets       1.19%       0.54%       1.10%       0.88%
Return on average common       9.59%       4.06%       8.70%       6.81%
equity

 
FIRST COMMUNITY BANCSHARES, INC.
CONDENSED QUARTERLY STATEMENTS OF INCOME (Unaudited)
                                                                   
                  As of and for the Quarter Ended
(Amounts in                   September
thousands,       December 31, 30,         June 30,    March 31,   December 31,
except share and 2012         2012        2012        2012        2011
per share data)
Interest Income                                                    
Interest and
fees on loans     $ 28,188     $ 28,275    $ 20,853    $ 19,368    $ 19,947
held for
investment
Interest on
securities ---    1,770        1,980       2,001       2,079       2,023
taxable
Interest on
securities ---    1,216        1,215       1,256       1,196       1,190
nontaxable
Interest on
deposits in       82           66          72          39          41
banks
Total interest    31,256       31,536      24,182      22,682      23,201
income
Interest Expense                                                   
Interest on       2,604        2,603       2,360       2,405       2,637
deposits
Interest on
short-term        656          675         589         595         592
borrowings
Interest on
long-term         1,860        1,799       1,749       1,705       1,706
borrowings
Total interest    5,120        5,077       4,698       4,705       4,935
expense
Net interest      26,136       26,459      19,484      17,977      18,266
income
Provision for     1,220        1,916       1,620       922         2,436
loan losses
Net interest
income after      24,916       24,543      17,864      17,055      15,830
provision for
loan losses
Noninterest                                                        
Income
Wealth
management        862          1,005       940         894         818
income
Service charges
on deposit        3,826        3,895       3,329       3,013       3,450
accounts
Other service     1,682        1,631       1,564       1,585       1,429
charges and fees
Insurance         1,215        1,616       1,336       1,576       1,170
commissions
Net impairment
losses            --           (942)       --          --          (1,548)
recognized in
earnings
Net gain (loss)
on sale of        316          228         (9)         51          26
securities
Other operating   346          3,730       1,183       872         1,261
income
Total
noninterest       8,247        11,163      8,343       7,991       6,606
income 
Noninterest                                                        
Expense
Salaries and
employee          10,693       10,860      8,892       8,222       7,903
benefits
Occupancy
expense of bank   1,938        1,754       1,654       1,526       1,589
premises
Furniture and     1,404        955         975         811         804
equipment
Amortization of
intangible        191          191         189         233         250
assets
FDIC premiums     313          611         290         322         344
and assessments 
Merger related    857          645         3,419       163         -- 
expense
Goodwill          --           --          --          --          1,239
impairment
Other operating   5,371        5,309       4,713       4,916       4,925
expense
Total
noninterest       20,767       20,325      20,132      16,193      17,054
expense
Income before     12,396       15,381      6,075       8,853       5,382
income taxes
Income tax        3,958        5,322       1,997       2,852       2,151
expense
Net income        8,438        10,059      4,078       6,001       3,231
Dividends on      272          220         283         283         286
preferred stock
Net income
available to      $ 8,166      $ 9,839     $ 3,795     $ 5,718     $ 2,945
common
shareholders
                                                                   
Basic earnings    $ 0.41       $ 0.49      $ 0.20      $ 0.32      $ 0.16
per common share
Diluted earnings  $ 0.39       $ 0.47      $ 0.20      $ 0.31      $ 0.17
per common share
Cash dividends    $ 0.11       $ 0.11      $ 0.11      $ 0.10      $ 0.10
per common share
                                                                   
Weighted average
basic shares      20,058,998   20,013,264  18,561,714  17,849,376  17,849,286
outstanding
Weighted average
diluted shares    21,373,669   21,476,497  19,909,242  19,189,923  19,159,090
outstanding

 
FIRST COMMUNITY BANCSHARES, INC.
RECONCILIATION OF GAAP NET INCOME TO CORE EARNINGS (Unaudited)
                                                                      
                                        Three Months Ended Year Ended
                                        December 31,       December 31,
                                        2012      2011     2012      2011
(Amounts in thousands, except per share                               
data)
Net income, GAAP                         $ 8,439   $ 3,231  $ 28,577  $ 20,028
Non-GAAP adjustments:                                                 
Net impairment losses recognized in      --        1,548    942       2,285
earnings
Net gain on sale of securities           (316)     (26)     (586)     (5,264)
FHLB debt prepayment fees                --        --       --        471
Merger related expense                   857       --       5,084     --
Goodwill impairment                      --        1,239    --        1,239
Prospective correction of prior period   --        --       (2,395)   --
understatement
Other noncore, nonrecurring items        --        --       --        59
Total adjustments to core earnings       541       2,761    3,045     (1,210)
Tax effect                               204       1,035    1,151     (454)
Core earnings, non-GAAP                  $ 8,776   $ 4,957  $ 30,471  $ 19,272
                                                                      
Core return on average assets           1.28%     0.91%    1.21%     0.88%
Core return on average common equity    10.30%    6.83%    9.63%     6.79%
Core return on average tangible common  15.10%    9.85%    13.95%    9.92%
equity
Core diluted earnings per common share  $0.41     $0.26    $1.49     $1.03

 
FIRST COMMUNITY BANCSHARES, INC.
EFFICIENCY RATIO CALCULATION (Unaudited)
                                                                      
                                       Three Months Ended  Year Ended
                                       December 31,        December 31,
                                       2012      2011      2012      2011
(Amounts in thousands)                                                
Noninterest expense, GAAP               $ 20,767  $ 17,054  $ 77,417  $ 68,915
Non-GAAP adjustments:                                                 
FHLB debt prepayment fees               --        --        --        (471)
Merger related expenses                 (857)     --        (5,084)   --
Goodwill impairment                     --        (1,239)   --        (1,239)
OREO expense and net loss               (312)     (455)     (1,893)   (3,081)
Other noncore, nonreccuring items       --        --        --        (77)
Adjusted noninterest expense            19,598    15,360    70,440    64,047
                                                                      
Net interest income, GAAP               26,136    18,266    90,056    72,029
Noninterest income, GAAP                8,247     6,606     35,744    35,534
Non-GAAP adjustments:                                                 
Tax equivalency adjustment              696       681       2,747     2,959
Net impairment losses recognized in     --        1,548     942       2,285
earnings
Net gain on sale of securities          (316)     (26)      (586)     (5,264)
Prospective correction of prior period  --        --        (2,395)   --
understatement
Other noncore, nonreccuring items       --        --        --        (18)
Adjusted net interest and noninterest   34,763    27,075    126,508   107,525
income
                                                                      
Efficiency Ratio                       56.38%    56.73%    55.68%    59.56%

 
FIRST COMMUNITY BANCSHARES, INC.
CONDENSED QUARTERLY BALANCE SHEETS (Unaudited)
                                                                       
                      For the Quarter Ended
                     December 31, September   June 30,    March 31,   December
                     2012         30,         2012        2012        31,
                                  2012                                2011
(Amounts in                                                            
thousands)
Cash and due from     $ 50,405     $ 44,865    $ 54,494    $ 36,555    $ 34,578
banks
Federal funds sold    66,509       93,005      64,815      61,328      1,909
Interest-bearing      27,933       27,359      36,856      11,729      10,807
deposits in banks
Total cash and cash   144,847      165,229     156,165     109,612     47,294
equivalents
Securities            534,358      517,161     526,607     478,352     482,430
available-for-sale 
Securities            816          816         1,295       2,874       3,490
held-to-maturity 
Loans held for sale   6,672        4,446       1,179       3,522       5,820
Loans held for
investment, net of                                                     
unearned income:
Covered under loss    207,869      221,977     238,777     --          --
share agreements
Not covered under
loss share            1,516,574    1,541,633   1,568,312   1,386,525   1,396,067
agreements
Less allowance for    25,770       25,835      26,171      25,800      26,205
loan losses
Loans, net            1,705,345    1,742,221   1,782,097   1,364,247   1,375,682
FDIC receivable
under loss share      48,073       49,477      52,067      --          --
agreements
Property, plant, and  64,868       62,191      60,829      54,616      54,721
equipment, net
Other real estate                                                      
owned:
Covered under loss    3,255        3,553       5,325       --          --
share agreements
Not covered under
loss share            5,749        5,957       4,938       3,829       5,914
agreements
Interest receivable   5,864        6,038       8,396       5,886       6,193
Goodwill              107,054      104,022     99,402      83,056      83,056
Intangible assets     3,522        3,713       3,903       4,093       4,326
Other assets          107,346      109,272     109,297     96,704      101,683
Total assets          $ 2,731,097  $2,769,650  $2,810,321  $2,203,269  $2,164,789
                                                                       
Deposits:                                                              
Noninterest-bearing   $ 343,352    $ 335,100   $ 340,895   $ 253,352   $ 240,268
Interest-bearing      353,321      360,061     335,686     307,136     275,156
Savings               500,276      496,740     494,516     397,850     394,707
Time                  833,226      872,059     934,110     621,412     633,336
Total deposits        2,030,175    2,063,960   2,105,207   1,579,750   1,543,467
Interest, taxes, and  30,896       29,538      22,465      23,203      20,452
other liabilities
Securities sold
under agreements to   136,118      146,904     148,367     124,266     129,208
repurchase
FHLB advances         161,558      161,558     176,653     150,000     150,000
Other borrowings      15,877       15,877      15,918      15,925      15,933
Total liabilities     2,374,624    2,417,837   2,468,610   1,893,144   1,859,060
                                                                       
Preferred stock       17,421       17,921      18,921      18,921      18,921
Common stock          20,343       20,309      20,240      18,083      18,083
Additional paid-in    213,829      213,320     212,510     188,149     188,118
capital
Retained earnings     113,013      107,055     99,418      97,588      93,656
Treasury stock, at    (6,458)      (5,446)     (5,672)     (5,721)     (5,721)
cost
Accumulated other     (1,675)      (1,346)     (3,706)     (6,895)     (7,328)
comprehensive loss
Total stockholders'   356,473      351,813     341,711     310,125     305,729
equity
Total liabilities                  $           $           $           $
and stockholders'     $ 2,731,097 2,769,650   2,810,321   2,203,269   2,164,789
equity
                                                                       
Shares outstanding    20,018,966   20,086,404  20,008,181  17,849,376  17,849,376
at period end
Book value per
common share at       $ 16.80      $ 16.50     $ 16.03     $ 16.19     $ 15.96
period end ^(1)
Tangible book value
per common share at   $ 11.59      $ 11.45     $ 11.19     $ 11.64     $ 11.40
period end ^(2)
                                                                       
                                                                       
(1) Book value per common share is defined as stockholders' equity divided by        
as-converted common shares outstanding.
(2) Tangible book value per common share is defined as stockholders' equity less
goodwill and other intangibles divided by as-converted common shares outstanding.

 
FIRST COMMUNITY BANCSHARES, INC.
SELECTED CREDIT QUALITY INFORMATION (Unaudited)
                                                                      
                          As of and for the Quarter Ended
                          December 31, September June 30,  March 31, December
(Amounts in thousands)    2012         30,       2012      2012      31,
                                       2012                          2011
Allowance for Loan Losses                                             
on Non-covered Loans
Beginning balance          $ 25,835     $ 26,171  $ 25,800  $ 26,205  $ 26,407
Provision for loan losses  1,220        1,916     1,620     922       2,436
Charge-offs                (1,717)      (2,613)   (1,613)   (1,562)   (2,915)
Recoveries                 432          361       364       235       277
Net charge-offs            (1,285)      (2,252)   (1,249)   (1,327)   (2,638)
Ending balance             $ 25,770     $ 25,835  $ 26,171  $ 25,800  $ 26,205
                                                                      
Summary of Asset Quality                                              
Non-covered loans                                                     
Nonaccrual loans           $ 23,931     $ 26,514  $ 27,947  $ 24,617  $ 24,487
Accruing loans past due    --           --        --        --        --
90 days or more
Troubled debt
restructurings ("TDRs")    4,734        121       469       2,668     600
^(1)
Total non-covered          28,665       26,635    28,416    27,285    25,087
nonperforming loans
Other real estate owned
("OREO") not covered       5,749        5,957     4,938     3,829     5,914
under FDIC loss share
agreements
Total non-covered          $ 34,414     $ 32,592  $ 33,354  $ 31,114  $ 31,001
nonperforming assets
Covered Loans                                                         
Nonaccrual loans           $ 4,323      $ 2,849   $ --      $ --      $ --
Accruing loans past due    --           --        --        --        --
90 days or more
Total covered              4,323        2,849     --        --        --
nonperforming loans
OREO covered under FDIC    3,255        3,553     5,325     --        --
loss share agreements
Total covered              7,578        6,402     5,325     --        --
nonperforming assets
Total nonperforming        $ 41,992     $ 38,994  $ 38,679  $ 31,114  $ 31,001
assets
                                                                      
Performing TDRs ^ (2)      $ 6,038      $ 6,742   $ 6,995   $ 7,052   $ 8,854
Total TDRs ^ (3)           $ 10,772     $ 6,863   $ 7,464   $ 9,720   $ 9,454
                                                                      
Asset Quality Ratios                                                  
Excluding covered assets                                              
Nonperforming loans to    1.89%        1.73%     1.81%     1.97%     1.80%
total loans
Nonperforming assets to   1.37%        1.28%     1.30%     1.41%     1.43%
total assets
Allowance for loan losses 89.90%       97.00%    92.10%    94.56%    104.46%
to nonperforming loans
Allowance for loan losses
to non-covered total      1.70%        1.68%     1.67%     1.86%     1.88%
loans
Annualized net
charge-offs to average    0.33%        0.57%     0.38%     0.38%     0.76%
loans
Including covered assets                                              
Nonperforming loans to    1.91%        1.67%     1.57%     1.97%     1.80%
total loans
Nonperforming assets to   1.54%        1.41%     1.38%     1.41%     1.43%
total assets
Allowance for loan losses 78.12%       87.62%    92.10%    94.56%    104.46%
to nonperforming loans
Allowance for loan losses 1.49%        1.46%     1.45%     1.86%     1.88%
to total loans
                                                                      
                                                                      
(1) Accruing TDRs
restructured within the                                               
past six months
(2) Accruing TDRs with
six months or more of                                                 
satisfactory payment
performance
(3) Accruing
nonperforming and                                                     
performing TDRs 

 
FIRST COMMUNITY BANCSHARES, INC.
SELECTED FINANCIAL INFORMATION (Unaudited)
                                                                      
                 As of and for the Quarter Ended
                 December 31, September    June 30,     March 31,    December 31,
                 2012         30,          2012         2012         2011
                              2012
Selected Ratios                                                       
Return on        1.19%        1.41%        0.65%        1.06%        0.54%
average assets
Return on
average common   9.59%        11.91%       5.00%        7.88%        4.06%
equity
Net interest     4.49%        4.48%        3.93%        3.91%        3.93%
margin
Efficiency ratio 56.38%       55.49%       57.58%       57.18%       56.73%
for the quarter 
Efficiency ratio 55.68%       52.40%       57.38%       57.18%       59.56%
year-to-date 
Total equity to  13.05%       12.70%       12.16%       14.08%       14.12%
total assets 
Average earning
assets to        86.87%       87.02%       87.68%       88.24%       88.27%
average assets
Average loans to 85.71%       87.88%       88.57%       89.85%       89.45%
average deposits
                                                                      
(Amounts in                                                           
thousands)
Average Balances                                                      
Loans             $ 1,745,584  $ 1,790,489  $ 1,512,451  $ 1,394,246  $ 1,392,650
Investment        519,798      528,126      490,219      481,595      479,638
securities
Earning assets    2,376,805    2,408,442    2,069,799    1,918,366    1,913,768
Total assets      2,736,037    2,767,790    2,360,567    2,174,004    2,168,166
Total deposits    2,036,697    2,037,467    1,707,613    1,551,728    1,556,990
Interest-bearing  1,699,991    1,733,987    1,437,548    1,312,865    1,320,186
deposits
Borrowings        314,645      329,958      303,474      290,015      295,303
Interest-bearing  2,014,636    2,063,945    1,741,022    1,602,880    1,615,489
liabilities
Stockholders'     356,812      347,637      323,994      310,795      306,779
equity
Tax equivalent
net interest      26,832       27,139       20,206       18,660       18,947
income

 
FIRST COMMUNITY BANCSHARES, INC.
AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS (Unaudited)
                                                                           
                    Three Months Ended December 31,
                    2012                           2011
                                           Average                        Average
(Amounts in         Average                Yield/  Average                Yield/
thousands)          Balance      Interest  Rate    Balance      Interest  Rate
                                 ^(1)      ^(1)                 ^(1)      ^(1)
Assets                                                                     
Earning assets                                                             
Loans ^(2)           $ 1,745,584  $ 28,231 6.43%    $ 1,392,650  $ 19,987 5.69%
Securities           518,982      3,623    2.78%    476,244      3,784    3.15%
available-for-sale
Securities           816          16       7.80%    3,394        70       8.18%
held-to-maturity
Interest-bearing     111,423      82       0.29%    41,480       41       0.39%
deposits
Total earning        2,376,805    31,952   5.35%    1,913,768    23,882   4.95%
assets
Other assets         359,232                        254,398                
Total assets         $ 2,736,037                    $ 2,168,166            
                                                                           
Liabilities                                                                
Interest-bearing                                                           
deposits
Demand deposits      $ 351,329    $ 62     0.07%    $ 277,722    $ 27     0.04%
Savings deposits     495,116      156      0.13%    395,530      117      0.12%
Time deposits        853,546      2,386    1.11%    646,934      2,493    1.53%
Total
interest-bearing     1,699,991    2,604    0.61%    1,320,186    2,637    0.79%
deposits
Borrowings                                                                 
Federal funds        --           --       0.00%    308          --       0.00%
purchased
Retail repurchase    79,014       105      0.53%    79,114       103      0.52%
agreements
Wholesale
repurchase           58,196       540      3.69%    50,000       479      3.80%
agreements
FHLB advances and    177,435      1,871    4.19%    165,881      1,716    4.10%
other borrowings
Total borrowings     314,645      2,516    3.18%    295,303      2,298    3.09%
Total
interest-bearing     2,014,636    5,120    1.01%    1,615,489    4,935    1.21%
liabilities
Noninterest-bearing  336,706                        236,804                
demand deposits
Other liabilities    27,883                         9,094                  
Total liabilities    2,379,225                      1,861,387              
Stockholders'        356,812                        306,779                
equity
Total liabilities
and stockholders'    $ 2,736,037                    $ 2,168,166            
equity
Net interest
income, tax                       $ 26,832                       $ 18,947  
equivalent
Net interest rate                          4.34%                          3.74%
spread ^(3)
Net interest                               4.49%                          3.93%
margin^(4)
                                                                           
(1) Fully taxable equivalent at the rate of 35% ("FTE"). The FTE basis adjusts
for the tax benefits of income on certain tax exempt loans and investments using
the federal statutory rate of 35% for each period presented. The Company believes
this measure to be the preferred industry measurement of net interest income and
provides relevant comparison between taxable and nontaxable amounts.
(2) Nonaccrual loans are included in average balances outstanding, but with no       
related interest income during the period of nonaccrual.
(3) Represents the difference between the yield on earning assets and cost of              
funds.
(4) Represents tax equivalent net interest income divided by average earning               
assets.

 
FIRST COMMUNITY BANCSHARES, INC.
AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS (Unaudited)
                                                                           
                    Year Ended December 31,
                    2012                           2011
                                           Average                        Average
(Amounts in         Average                Yield/  Average                Yield/
thousands)          Balance      Interest  Rate    Balance      Interest  Rate
                                 ^(1)      ^(1)                 ^(1)      ^(1)
Assets                                                                     
Earning assets                                                             
Loans ^(2)           $ 1,611,557  $ 96,803 6.01%    $ 1,382,097  $ 80,742 5.84%
Securities           502,416      15,170   3.02%    434,583      15,775   3.63%
available-for-sale
Securities           2,622        171      6.52%    3,999        333      8.33%
held-to-maturity
Interest-bearing     77,851       259      0.33%    116,063      285      0.25%
deposits
Total earning        2,194,446    112,403  5.12%    1,936,742    97,135   5.02%
assets
Other assets         316,485                        258,897                
Total assets         $ 2,510,931                    $ 2,195,639            
                                                                           
Liabilities                                                                
Interest-bearing                                                           
deposits
Demand deposits      $ 306,019    $ 185    0.06%    $ 277,263    $ 431    0.16%
Savings deposits     471,406      556      0.12%    410,240      886      0.22%
Time deposits        776,901      9,231    1.19%    682,997      11,471   1.68%
Total
interest-bearing     1,554,326    9,972    0.64%    1,370,500    12,788   0.93%
deposits
Borrowings                                                                 
Federal funds        490          2        0.41%    77           --       0.00%
purchased
Retail repurchase    78,608       449      0.57%    83,564       544      0.65%
agreements
Wholesale
repurchase           55,163       2,023    3.67%    50,000       1,887    3.77%
agreements
FHLB advances and    175,333      7,154    4.08%    168,988      6,928    4.10%
other borrowings
Total borrowings     309,594      9,628    3.11%    302,629      9,359    3.09%
Total
interest-bearing     1,863,920    19,600   1.05%    1,673,129    22,147   1.32%
liabilities
Noninterest-bearing  286,950                        223,233                
demand deposits
Other liabilities    25,160                         4,127                  
Total liabilities    2,176,030                      1,900,489              
Stockholders'        334,901                        295,150                
equity
Total liabilities
and stockholders'    $ 2,510,931                    $ 2,195,639            
equity
Net interest
income, tax                       $ 92,803                       $ 74,988  
equivalent
Net interest rate                          4.07%                          3.69%
spread ^(3)
Net interest                               4.23%                          3.87%
margin^(4)
                                                                           
(1) Fully taxable equivalent at the rate of 35% ("FTE"). The FTE basis adjusts
for the tax benefits of income on certain tax exempt loans and investments using
the federal statutory rate of 35% for each period presented. The Company believes
this measure to be the preferred industry measurement of net interest income and
provides relevant comparison between taxable and nontaxable amounts.
(2) Nonaccrual loans are included in average balances outstanding, but with no           
related interest income during the period of nonaccrual.
(3) Represents the difference between the yield on earning assets and cost of                
funds.
(4) Represents tax equivalent net interest income divided by average earning                 
assets.

CONTACT: David D. Brown
         (276) 326-9000

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