Chesterton Tribune

 

 

Horizon Bancorp posts lower earnings in 1Q

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Horizon Bancorp is reporting net income in the first quarter of 2014 of $3.4 million or 38 cents diluted earnings per share, compared to $5.3 million or 53 cents in the year-ago period.

“Excluding transaction expenses related to the acquisition of SCB Bancorp Inc. of $311,000, net income would have been $3.6 million or 40 cents for the first quarter of 2014,” Horizon said in a statement released today. “The decrease in net income for the quarter primarily reflects the decline in mortgage warehouse activity as well as a reduction in interest income from Heartland loan valuation discounts recognized at the time of acquisition being accreted and discounts recognized from loans paying off.”

Net interest income, after provisions for loan losses, for the first three months of 2014 was $13.3 million compared with $13.9 million for the same period in the prior year.

Horizon’s previously announced acquisition of SCB Bancorp Inc. and its wholly-owned subsidiary, Summit Community Bank, headquartered in East Lansing, Mich., closed as scheduled on April 3.

Non-interest income was $5.5 million in first quarter 2014 compared with $7.5 million in the year-ago, reflecting a decrease of $1.7 million in gain on sale of loans and a decrease of $368,000 in gain on sale of investment securities.

Total loans increased $34.0 million during the quarter to $1.1 billion on March 31.

Commercial loans increased $23.4 million during the quarter or 4.6 percent to $528.6 million on March 31.

“We are very pleased to continue Horizon’s growth story this quarter by achieving solid loan and core deposit growth despite the highly competitive environment and tepid economic recovery,” Horizon Chair and CEO Craig Dwight said. “This growth speaks to the quality and dedication of our team to expand existing client relationships and source new business opportunities.”

Dwight specifically noted the growth in commercial loans during the quarter, which on an annualized basis amounts to an increase of 18.6 percent.

“The slowdown in residential mortgage lending negatively impacted our results in the first quarter of 2014, continuing to validate Horizon’s four balanced revenue streams--business banking, retail banking, residential mortgage lending and wealth and investment management,” Craig added. “In anticipation of the residential mortgage lending slowdown, we made significant investments in new market entries, employee talent, commitment to customer service guarantees and technology to provide the best in class service to our customers. Our results this quarter illustrate these investments are paying off. At the same time, our continued asset quality improvement has enabled the bank to significantly reduce our provision for loan losses, reflecting the hard work of our collections and credit administration staff.”

 

Posted 4/23/2014