TEXAS
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75-1848732
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
|
|
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1201 S. Beckham, Tyler, Texas
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75701
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
o
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Accelerated filer
x
|
Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
|
Page | ||||
PART I. FINANCIAL INFORMATION | ||||
ITEM 1. | 1 | |||
ITEM 2. | 31 | |||
ITEM 3. | 49 | |||
ITEM 4. | 50 | |||
PART II. OTHER INFORMATION | ||||
ITEM 1. | 50 | |||
ITEM 1A. | 50 | |||
ITEM 2. | 50 | |||
ITEM 3. | 50 | |||
ITEM 4. | 50 | |||
ITEM 5. | 50 | |||
ITEM 6. | 50 | |||
SIGNATURES | 52 | |||
Exhibit Index | ||||
Exhibit 10.1 – Form of Nonstatutory Stock Option Award Certificate under the Southside Bancshares, Inc. 2009 Incentive Plan | ||||
Exhibit 10.2 – Form of Restricted Stock Unit Award Certificate under the Southside Bancshares, Inc. 2009 Incentive Plan | ||||
Exhibit 31.1 – Certification Pursuant to Section 302 | ||||
Exhibit 31.2 – Certification Pursuant to Section 302 | ||||
Exhibit 32 – Certification Pursuant to Section 906 |
June 30,
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December 31,
|
|||||||
ASSETS
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2011
|
2010
|
||||||
Cash and due from banks
|
$ | 46,090 | $ | 56,188 | ||||
Interest earning deposits
|
2,364 | 22,885 | ||||||
Total cash and cash equivalents
|
48,454 | 79,073 | ||||||
Investment securities:
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||||||||
Available for sale, at estimated fair value
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302,038 | 299,344 | ||||||
Held to maturity, at amortized cost
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1,996 | 1,495 | ||||||
Mortgage-backed and related securities:
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||||||||
Available for sale, at estimated fair value
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1,136,961 | 946,043 | ||||||
Held to maturity, at amortized cost
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395,728 | 417,862 | ||||||
FHLB stock, at cost
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25,524 | 34,712 | ||||||
Other investments, at cost
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2,064 | 2,064 | ||||||
Loans held for sale
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2,738 | 6,583 | ||||||
Loans:
|
||||||||
Loans
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1,038,808 | 1,077,920 | ||||||
Less: allowance for loan losses
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(19,409 | ) | (20,711 | ) | ||||
Net Loans
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1,019,399 | 1,057,209 | ||||||
Premises and equipment, net
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50,568 | 50,144 | ||||||
Goodwill
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22,034 | 22,034 | ||||||
Other intangible assets, net
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642 | 777 | ||||||
Interest receivable
|
19,403 | 18,033 | ||||||
Deferred tax asset
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– | 6,677 | ||||||
Other assets
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87,659 | 57,571 | ||||||
TOTAL ASSETS
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$ | 3,115,208 | $ | 2,999,621 | ||||
LIABILITIES AND EQUITY
|
||||||||
Deposits:
|
||||||||
Noninterest bearing
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$ | 515,591 | $ | 423,304 | ||||
Interest bearing
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1,723,946 | 1,711,124 | ||||||
Total Deposits
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2,239,537 | 2,134,428 | ||||||
Short-term obligations:
|
||||||||
Federal funds purchased and repurchase agreements
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3,077 | 3,844 | ||||||
FHLB advances
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254,803 | 189,094 | ||||||
Other obligations
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2,909 | 2,651 | ||||||
Total Short-term obligations
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260,789 | 195,589 | ||||||
Long-term obligations:
|
||||||||
FHLB advances
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277,979 | 373,479 | ||||||
Long-term debt
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60,311 | 60,311 | ||||||
Total Long-term obligations
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338,290 | 433,790 | ||||||
Deferred tax liability
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1,255 | – | ||||||
Other liabilities
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30,862 | 20,378 | ||||||
TOTAL LIABILITIES
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2,870,733 | 2,784,185 | ||||||
Off-Balance-Sheet Arrangements, Commitments and Contingencies (Note 10)
|
||||||||
Shareholders' equity:
|
||||||||
Common stock - $1.25 par, 40,000,000 shares authorized, 18,474,045 shares issued in 2011 and 17,660,312 shares issued in 2010
|
23,092 | 22,075 | ||||||
Paid-in capital
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178,450 | 162,877 | ||||||
Retained earnings
|
61,472 | 64,567 | ||||||
Treasury stock (2,023,838 shares at cost)
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(28,377 | ) | (28,377 | ) | ||||
Accumulated other comprehensive income (loss)
|
7,842 | (6,819 | ) | |||||
TOTAL SHAREHOLDERS' EQUITY
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242,479 | 214,323 | ||||||
Noncontrolling interest
|
1,996 | 1,113 | ||||||
TOTAL EQUITY
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244,475 | 215,436 | ||||||
TOTAL LIABILITIES AND EQUITY
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$ | 3,115,208 | $ | 2,999,621 |
Three Months
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Six Months
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|||||||||||||||
Ended June 30,
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Ended June 30,
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|||||||||||||||
2011
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2010
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2011
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2010
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|||||||||||||
Interest income
|
||||||||||||||||
Loans
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$ | 17,130 | $ | 17,437 | $ | 34,401 | $ | 35,202 | ||||||||
Investment securities – taxable
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20 | 26 | 38 | 52 | ||||||||||||
Investment securities – tax-exempt
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3,209 | 3,017 | 6,438 | 5,843 | ||||||||||||
Mortgage-backed and related securities
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13,310 | 10,282 | 24,607 | 24,559 | ||||||||||||
FHLB stock and other investments
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52 | 59 | 132 | 141 | ||||||||||||
Other interest earning assets
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3 | 4 | 13 | 15 | ||||||||||||
Total interest income
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33,724 | 30,825 | 65,629 | 65,812 | ||||||||||||
Interest expense
|
||||||||||||||||
Deposits
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4,051 | 4,733 | 8,087 | 9,738 | ||||||||||||
Short-term obligations
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1,705 | 1,867 | 3,434 | 3,547 | ||||||||||||
Long-term obligations
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3,401 | 4,855 | 7,282 | 10,081 | ||||||||||||
Total interest expense
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9,157 | 11,455 | 18,803 | 23,366 | ||||||||||||
Net interest income
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24,567 | 19,370 | 46,826 | 42,446 | ||||||||||||
Provision for loan losses
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1,860 | 2,260 | 3,998 | 6,127 | ||||||||||||
Net interest income after provision for loan losses
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22,707 | 17,110 | 42,828 | 36,319 | ||||||||||||
Noninterest income
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||||||||||||||||
Deposit services
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4,028 | 4,400 | 7,907 | 8,464 | ||||||||||||
Gain on sale of securities available for sale
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4,004 | 6,661 | 5,809 | 15,016 | ||||||||||||
Total other-than-temporary impairment losses
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– | – | – | (39 | ) | |||||||||||
Portion of loss recognized in other comprehensive income (before taxes)
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– | – | – | (36 | ) | |||||||||||
Net impairment losses recognized in earnings
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– | – | – | (75 | ) | |||||||||||
Gain on sale of loans
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282 | 399 | 565 | 680 | ||||||||||||
Trust income
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645 | 561 | 1,296 | 1,091 | ||||||||||||
Bank owned life insurance income
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261 | 285 | 547 | 570 | ||||||||||||
Other
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959 | 864 | 2,064 | 1,797 | ||||||||||||
Total noninterest income
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10,179 | 13,170 | 18,188 | 27,543 | ||||||||||||
Noninterest expense
|
||||||||||||||||
Salaries and employee benefits
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11,622 | 11,215 | 23,313 | 22,157 | ||||||||||||
Occupancy expense
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1,778 | 1,662 | 3,499 | 3,305 | ||||||||||||
Equipment expense
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525 | 472 | 1,018 | 909 | ||||||||||||
Advertising, travel & entertainment
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550 | 544 | 1,103 | 1,081 | ||||||||||||
ATM and debit card expense
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266 | 212 | 481 | 379 | ||||||||||||
Director fees
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200 | 216 | 391 | 393 | ||||||||||||
Supplies
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161 | 206 | 385 | 476 | ||||||||||||
Professional fees
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457 | 539 | 1,012 | 945 | ||||||||||||
Postage
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186 | 231 | 365 | 417 | ||||||||||||
Telephone and communications
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345 | 346 | 682 | 719 | ||||||||||||
FDIC Insurance
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735 | 689 | 1,498 | 1,368 | ||||||||||||
Other
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1,291 | 1,647 | 3,101 | 3,282 | ||||||||||||
Total noninterest expense
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18,116 | 17,979 | 36,848 | 35,431 | ||||||||||||
Income before income tax expense
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14,770 | 12,301 | 24,168 | 28,431 | ||||||||||||
Provision for income tax expense
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3,241 | 2,530 | 4,457 | 6,485 | ||||||||||||
Net income
|
11,529 | 9,771 | 19,711 | 21,946 | ||||||||||||
Less: Net income attributable to the noncontrolling interest
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(493 | ) | (519 | ) | (1,358 | ) | (1,049 | ) | ||||||||
Net income attributable to Southside Bancshares, Inc.
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$ | 11,036 | $ | 9,252 | $ | 18,353 | $ | 20,897 | ||||||||
Earnings per common share – basic
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$ | 0.67 | $ | 0.56 | $ | 1.12 | $ | 1.26 | ||||||||
Earnings per common share – diluted
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$ | 0.67 | $ | 0.56 | $ | 1.12 | $ | 1.26 | ||||||||
Dividends paid per common share
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$ | 0.17 | $ | 0.17 | $ | 0.34 | $ | 0.34 |
Six Months Ended
June 30,
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||||||||
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2011
|
2010
|
||||||
Common Stock
|
|
|
||||||
Balance, beginning of period
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$ | 22,075 | $ | 20,928 | ||||
Issuance of common stock (28,869 shares in 2011 and 106,936 shares in 2010)
|
36 | 134 | ||||||
Stock dividend declared
|
981 | 943 | ||||||
Balance, end of period
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23,092 | 22,005 | ||||||
Paid-in capital
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||||||||
Balance, beginning of period
|
162,877 | 146,357 | ||||||
Issuance of common stock (28,869 shares in 2011 and 106,936 shares in 2010)
|
531 | 767 | ||||||
Stock compensation expense
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26 | – | ||||||
Tax benefit of incentive stock options
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2 | 316 | ||||||
Stock dividend declared
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15,014 | 14,570 | ||||||
Balance, end of period
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178,450 | 162,010 | ||||||
Retained earnings
|
||||||||
Balance, beginning of period
|
64,567 | 53,812 | ||||||
Net income attributable to Southside Bancshares, Inc.
|
18,353 | 20,897 | ||||||
Dividends paid on common stock ($0.34 per share in 2011 and $0.34 per share in 2010)
|
(5,453 | ) | (5,241 | ) | ||||
Stock dividend declared
|
(15,995 | ) | (15,513 | ) | ||||
Balance, end of period
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61,472 | 53,955 | ||||||
Treasury Stock
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||||||||
Balance, beginning of period
|
(28,377 | ) | (23,545 | ) | ||||
Purchase of common stock (1,101 shares in 2010)
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– | (24 | ) | |||||
Balance, end of period
|
(28,377 | ) | (23,569 | ) | ||||
Accumulated other comprehensive (loss) income
|
||||||||
Balance, beginning of period
|
(6,819 | ) | 4,229 | |||||
Net unrealized gains on available for sale securities, net of tax
|
17,975 | 9,008 | ||||||
Reclassification adjustment for gains on sales of available for sale securities included in net income, net of tax
|
(3,776 | ) | (9,760 | ) | ||||
Noncredit portion of other-than-temporary impairment losses on available for sale securities, net of tax
|
– | 23 | ||||||
Reclassification of other-than-temporary impairment charges on available for sale securities included in net income, net of tax
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– | 49 | ||||||
Adjustment to net periodic benefit cost, net of tax
|
462 | 407 | ||||||
Net change in accumulated other comprehensive income (loss)
|
14,661 | (273 | ) | |||||
Balance, end of period
|
7,842 | 3,956 | ||||||
Total shareholders’ equity
|
242,479 | 218,357 | ||||||
Noncontrolling interest
|
||||||||
Balance, beginning of period
|
1,113 | 468 | ||||||
Net income attributable to noncontrolling interest shareholders
|
1,358 | 1,049 | ||||||
Capital distribution to noncontrolling interest shareholders
|
(475 | ) | (310 | ) | ||||
Balance, end of period
|
1,996 | 1,207 | ||||||
Total equity
|
$ | 244,475 | $ | 219,564 | ||||
Comprehensive income
|
||||||||
Net income
|
$ | 19,711 | $ | 21,946 | ||||
Net change in accumulated other comprehensive income (loss)
|
14,661 | (273 | ) | |||||
Comprehensive income
|
34,372 | 21,673 | ||||||
Comprehensive income attributable to the noncontrolling interest
|
(1,358 | ) | (1,049 | ) | ||||
Comprehensive income attributable to Southside Bancshares, Inc.
|
$ | 33,014 | $ | 20,624 |
Six Months Ended
June 30,
|
||||||||
|
2011
|
2010
|
||||||
|
|
|
||||||
OPERATING ACTIVITIES:
|
|
|
||||||
Net income
|
$ | 19,711 | $ | 21,946 | ||||
Adjustments to reconcile net income to net cash provided by operations:
|
||||||||
Depreciation
|
1,646 | 1,568 | ||||||
Amortization of premium
|
16,782 | 18,038 | ||||||
Accretion of discount and loan fees
|
(2,327 | ) | (2,545 | ) | ||||
Provision for loan losses
|
3,998 | 6,127 | ||||||
Stock compensation expense
|
26 | – | ||||||
(Increase) decrease in interest receivable
|
(1,370 | ) | 1,098 | |||||
Increase in other assets
|
(2,593 | ) | (1,513 | ) | ||||
Net change in deferred taxes
|
38 | 171 | ||||||
Decrease in interest payable
|
(575 | ) | (548 | ) | ||||
Increase in other liabilities
|
2,364 | 2,799 | ||||||
Decrease (increase) in loans held for sale
|
3,845 | (681 | ) | |||||
Gain on sale of securities available for sale
|
(5,809 | ) | (15,016 | ) | ||||
Net other-than-temporary impairment losses
|
– | 75 | ||||||
Loss (gain) on sale of assets
|
3 | (7 | ) | |||||
Loss on retirement of assets
|
90 | – | ||||||
Impairment on other real estate owned
|
145 | 20 | ||||||
Gain on sale of other real estate owned
|
(221 | ) | (12 | ) | ||||
Net cash provided by operating activities
|
35,753 | 31,520 | ||||||
|
||||||||
INVESTING ACTIVITIES:
|
||||||||
Proceeds from sales of investment securities available for sale
|
28,213 | 40,746 | ||||||
Proceeds from sales of mortgage-backed securities available for sale
|
314,736 | 758,901 | ||||||
Proceeds from maturities of investment securities available for sale
|
14,037 | 9,804 | ||||||
Proceeds from maturities of mortgage-backed securities available for sale
|
136,701 | 199,778 | ||||||
Proceeds from maturities of mortgage-backed securities held to maturity
|
24,730 | 38,012 | ||||||
Proceeds from redemption of FHLB stock
|
14,811 | 2,638 | ||||||
Purchases of investment securities available for sale
|
(32,131 | ) | (54,317 | ) | ||||
Purchases of investment securities held to maturity
|
(500 | ) | – | |||||
Purchases of mortgage-backed securities available for sale
|
(662,803 | ) | (721,114 | ) | ||||
Purchases of mortgage-backed securities held to maturity
|
(5,894 | ) | (258,935 | ) | ||||
Purchases of FHLB stock and other investments
|
(5,623 | ) | (105 | ) | ||||
Net decrease in loans
|
32,740 | 8,995 | ||||||
Purchases of premises and equipment
|
(2,169 | ) | (3,600 | ) | ||||
Proceeds from sales of premises and equipment
|
6 | 38 | ||||||
Proceeds from sales of other real estate owned
|
306 | 722 | ||||||
Proceeds from sales of repossessed assets
|
2,767 | 2,740 | ||||||
Net cash (used in) provided by investing activities
|
(140,073 | ) | 24,303 |
Three Months
|
Six Months
|
|||||||||||||||
Ended June 30,
|
Ended June 30,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Basic and Diluted Earnings:
|
||||||||||||||||
Net Income - Southside Bancshares, Inc.
|
$ | 11,036 | $ | 9,252 | $ | 18,353 | $ | 20,897 | ||||||||
Basic weighted-average shares outstanding
|
16,439 | 16,605 | 16,432 | 16,573 | ||||||||||||
Add: Stock options
|
6 | 30 | 5 | 48 | ||||||||||||
Diluted weighted-average shares outstanding
|
16,445 | 16,635 | 16,437 | 16,621 | ||||||||||||
Basic Earnings Per Share:
|
||||||||||||||||
Net Income - Southside Bancshares, Inc.
|
$ | 0.67 | $ | 0.56 | $ | 1.12 | $ | 1.26 | ||||||||
Diluted Earnings Per Share:
|
||||||||||||||||
Net Income - Southside Bancshares, Inc.
|
$ | 0.67 | $ | 0.56 | $ | 1.12 | $ | 1.26 |
Six Months Ended June 30, 2011
|
||||||||||||
|
Before-Tax
|
Tax
|
Net-of-Tax
|
|||||||||
|
Amount
|
Expense
|
Amount
|
|||||||||
Unrealized gains on securities:
|
|
|
|
|||||||||
Unrealized holding gains arising during period
|
$ | 27,653 | $ | (9,678 | ) | $ | 17,975 | |||||
Less: reclassification adjustment for gains included in net income
|
5,809 | (2,033 | ) | 3,776 | ||||||||
Net unrealized gains on securities
|
21,844 | (7,645 | ) | 14,199 | ||||||||
Change in pension plans
|
711 | (249 | ) | 462 | ||||||||
Other comprehensive income
|
$ | 22,555 | $ | (7,894 | ) | $ | 14,661 |
Three Months Ended June 30, 2011
|
||||||||||||
|
Before-Tax
|
Tax
|
Net-of-Tax
|
|||||||||
|
Amount
|
Expense
|
Amount
|
|||||||||
Unrealized gains on securities:
|
|
|
|
|||||||||
Unrealized holding gains arising during period
|
$ | 24,289 | $ | (8,501 | ) | $ | 15,788 | |||||
Less: reclassification adjustment for gains included in net income
|
4,004 | (1,402 | ) | 2,602 | ||||||||
Net unrealized gains on securities
|
20,285 | (7,099 | ) | 13,186 | ||||||||
Change in pension plans
|
356 | (125 | ) | 231 | ||||||||
Other comprehensive income
|
$ | 20,641 | $ | (7,224 | ) | $ | 13,417 |
Six Months Ended June 30, 2010
|
||||||||||||
|
Before-Tax
|
Tax (Expense)
|
Net-of-Tax
|
|||||||||
|
Amount
|
Benefit
|
Amount
|
|||||||||
Unrealized losses on securities:
|
|
|
|
|||||||||
Unrealized holding gains arising during period
|
$ | 13,859 | $ | (4,851 | ) | $ | 9,008 | |||||
Noncredit portion of other-than-temporary impairment losses on the AFS securities
|
36 | (13 | ) | 23 | ||||||||
Less: reclassification adjustment for gains included in net income
|
15,016 | (5,256 | ) | 9,760 | ||||||||
Less: reclassification of other-than-temporary impairment charges on AFS securities included in net income
|
(75 | ) | 26 | (49 | ) | |||||||
Net unrealized losses on securities
|
(1,046 | ) | 366 | (680 | ) | |||||||
Change in pension plans
|
626 | (219 | ) | 407 | ||||||||
Other comprehensive loss
|
$ | (420 | ) | $ | 147 | $ | (273 | ) |
Three Months Ended June 30, 2010
|
||||||||||||
|
Before-Tax
|
Tax
|
Net-of-Tax
|
|||||||||
|
Amount
|
Expense
|
Amount
|
|||||||||
Unrealized gains on securities:
|
|
|
|
|||||||||
Unrealized holding gains arising during period
|
$ | 12,998 | $ | (4,550 | ) | $ | 8,448 | |||||
Noncredit portion of other-than-temporary impairment losses on the AFS securities
|
– | – | – | |||||||||
Less: reclassification adjustment for gains included in net income
|
6,661 | (2,332 | ) | 4,329 | ||||||||
Less: reclassification of other-than-temporary impairment charges on AFS securities included in net income
|
– | – | – | |||||||||
Net unrealized gains on securities
|
6,337 | (2,218 | ) | 4,119 | ||||||||
Change in pension plans
|
379 | (133 | ) | 246 | ||||||||
Other comprehensive income
|
$ | 6,716 | $ | (2,351 | ) | $ | 4,365 |
June 30, 2011
|
||||||||||||||||||||
Gross
|
Gross Unrealized
Losses
|
|||||||||||||||||||
Amortized
|
Unrealized
|
Noncredit
|
Estimated
|
|||||||||||||||||
AVAILABLE FOR SALE:
|
Cost
|
Gains
|
OTTI
|
Other
|
Fair Value
|
|||||||||||||||
Investment Securities:
|
||||||||||||||||||||
State and Political Subdivisions
|
$ | 292,413 | $ | 10,379 | $ | – | $ | 1,711 | $ | 301,081 | ||||||||||
Other Stocks and Bonds
|
2,925 | – | 1,968 | – | 957 | |||||||||||||||
Mortgage-backed Securities:
|
||||||||||||||||||||
U.S. Government Agencies
|
155,582 | 7,446 | – | 112 | 162,916 | |||||||||||||||
Government-Sponsored Enterprises
|
952,460 | 23,006 | – | 1,421 | 974,045 | |||||||||||||||
Total
|
$ | 1,403,380 | $ | 40,831 | $ | 1,968 | $ | 3,244 | $ | 1,438,999 |
June 30, 2011
|
||||||||||||||||||||
Gross
|
Gross Unrealized Losses
|
|||||||||||||||||||
Amortized
|
Unrealized
|
Noncredit
|
Estimated
|
|||||||||||||||||
HELD TO MATURITY:
|
Cost
|
Gains
|
OTTI
|
Other
|
Fair Value
|
|||||||||||||||
Investment Securities:
|
||||||||||||||||||||
U.S. Treasury
|
$ | 500 | $ | – | $ | – | $ | – | $ | 500 | ||||||||||
State and Political Subdivisions
|
1,011 | 123 | – | – | 1,134 | |||||||||||||||
Other Stocks and Bonds
|
485 | 16 | – | – | 501 | |||||||||||||||
Mortgage-backed Securities:
|
||||||||||||||||||||
U.S. Government Agencies
|
19,780 | 1,034 | – | – | 20,814 | |||||||||||||||
Government-Sponsored Enterprises
|
375,948 | 15,363 | – | 7 | 391,304 | |||||||||||||||
Total
|
$ | 397,724 | $ | 16,536 | $ | – | $ | 7 | $ | 414,253 |
December 31, 2010
|
||||||||||||||||||||
Gross
|
Gross Unrealized Losses
|
|||||||||||||||||||
Amortized
|
Unrealized
|
Noncredit
|
Estimated
|
|||||||||||||||||
AVAILABLE FOR SALE:
|
Cost
|
Gains
|
OTTI
|
Other
|
Fair Value
|
|||||||||||||||
Investment Securities:
|
||||||||||||||||||||
U.S. Treasury
|
$ | 4,700 | $ | – | $ | – | $ | – | $ | 4,700 | ||||||||||
State and Political Subdivisions
|
296,357 | 4,445 | – | 6,540 | 294,262 | |||||||||||||||
Other Stocks and Bonds
|
3,117 | 1 | 2,736 | – | 382 | |||||||||||||||
Mortgage-backed Securities:
|
||||||||||||||||||||
U.S. Government Agencies
|
149,402 | 5,311 | – | 179 | 154,534 | |||||||||||||||
Government-Sponsored Enterprises
|
777,921 | 16,049 | – | 2,461 | 791,509 | |||||||||||||||
Total
|
$ | 1,231,497 | $ | 25,806 | $ | 2,736 | $ | 9,180 | $ | 1,245,387 |
December 31, 2010
|
||||||||||||||||||||
Gross
|
Gross Unrealized Losses
|
|||||||||||||||||||
Amortized
|
Unrealized
|
Noncredit
|
Estimated
|
|||||||||||||||||
HELD TO MATURITY:
|
Cost
|
Gains
|
OTTI
|
Other
|
Fair Value
|
|||||||||||||||
Investment Securities:
|
||||||||||||||||||||
State and Political Subdivisions
|
$ | 1,012 | $ | 44 | $ | – | $ | – | $ | 1,056 | ||||||||||
Other Stocks and Bonds
|
483 | 14 | – | – | 497 | |||||||||||||||
Mortgage-backed Securities:
|
||||||||||||||||||||
U.S. Government Agencies
|
21,888 | 631 | – | 55 | 22,464 | |||||||||||||||
Government-Sponsored Enterprises
|
395,974 | 8,743 | – | 609 | 404,108 | |||||||||||||||
Total
|
$ | 419,357 | $ | 9,432 | $ | – | $ | 664 | $ | 428,125 |
|
Less Than 12 Months
|
More Than 12 Months
|
Total
|
|||||||||||||||||||||
|
Fair Value
|
Unrealized Loss
|
Fair Value
|
Unrealized Loss
|
Fair Value
|
Unrealized Loss
|
||||||||||||||||||
As of June 30, 2011:
|
||||||||||||||||||||||||
Available for Sale
|
|
|
|
|
|
|
||||||||||||||||||
State and Political Subdivisions
|
$ | 66,071 | $ | 1,672 | $ | 271 | $ | 39 | $ | 66,342 | $ | 1,711 | ||||||||||||
Other Stocks and Bonds
|
– | – | 957 | 1,968 | 957 | 1,968 | ||||||||||||||||||
Mortgage-Backed Securities
|
210,478 | 1,470 | 8,534 | 63 | 219,012 | 1,533 | ||||||||||||||||||
Total
|
$ | 276,549 | $ | 3,142 | $ | 9,762 | $ | 2,070 | $ | 286,311 | $ | 5,212 | ||||||||||||
Held to Maturity
|
||||||||||||||||||||||||
Mortgage-Backed Securities
|
$ | 568 | $ | 7 | $ | – | $ | – | $ | 568 | $ | 7 | ||||||||||||
Total
|
$ | 568 | $ | 7 | $ | – | $ | – | $ | 568 | $ | 7 |
As of December 31, 2010:
|
||||||||||||||||||||||||
Available for Sale
|
|
|
|
|
|
|
||||||||||||||||||
State and Political Subdivisions
|
$ | 136,671 | $ | 6,501 | $ | 270 | $ | 39 | $ | 136,941 | $ | 6,540 | ||||||||||||
Other Stocks and Bonds
|
– | – | 189 | 2,736 | 189 | 2,736 | ||||||||||||||||||
Mortgage-Backed Securities
|
312,985 | 2,475 | 21,779 | 165 | 334,764 | 2,640 | ||||||||||||||||||
Total
|
$ | 449,656 | $ | 8,976 | $ | 22,238 | $ | 2,940 | $ | 471,894 | $ | 11,916 | ||||||||||||
Held to Maturity
|
||||||||||||||||||||||||
Mortgage-Backed Securities
|
$ | 52,676 | $ | 644 | $ | 1,104 | $ | 20 | $ | 53,780 | $ | 664 | ||||||||||||
Total
|
$ | 52,676 | $ | 644 | $ | 1,104 | $ | 20 | $ | 53,780 | $ | 664 |
TRUP
|
Par
|
Credit
Loss
|
Amortized Cost
|
Fair Value
|
Tranche
|
Credit Rating
|
|||||||||||||||||||
1 | $ | 2,000 | $ | 1,075 | $ | 925 | $ | 300 | C1 |
Ca
|
|||||||||||||||
2 | 2,000 | 550 | 1,450 | 354 | B1 | C | |||||||||||||||||||
3 | 2,000 | 1,450 | 550 | 303 | B2 | C | |||||||||||||||||||
$ | 6,000 | $ | 3,075 | $ | 2,925 | $ | 957 |
Six Months Ended June 30, 2011
|
||||||||||||
Impairment Related to Credit Loss
|
Impairment Related to All Other Factors
|
Total Impairment
|
||||||||||
Balance, beginning of the period
|
$ | 3,075 | $ | 2,694 | $ | 5,769 | ||||||
Charges on securities for which other-than-temporary impairment charges were not previously recognized
|
– | – | – | |||||||||
Additional charges on securities for which other-than-temporary impairment charges were previously recognized
|
– | – | – | |||||||||
Balance, end of the period
|
$ | 3,075 | $ | 2,694 | $ | 5,769 |
Three Months Ended June 30, 2011
|
||||||||||||
Impairment Related to Credit Loss
|
Impairment Related to All Other Factors
|
Total Impairment
|
||||||||||
Balance, beginning of the period
|
$ | 3,075 | $ | 2,694 | $ | 5,769 | ||||||
Charges on securities for which other-than-temporary impairment charges were not previously recognized
|
– | – | – | |||||||||
Additional charges on securities for which other-than-temporary impairment charges were previously recognized
|
– | – | – | |||||||||
Balance, end of the period
|
$ | 3,075 | $ | 2,694 | $ | 5,769 |
Six Months Ended
|
||||||||
|
June 30,
2011
|
June 30,
2010
|
||||||
U.S. Treasury
|
|
$
|
6
|
$
|
4
|
|||
State and Political Subdivisions
|
|
6,452
|
5,864
|
|||||
Other Stocks and Bonds
|
|
18
|
27
|
|||||
Mortgage-backed Securities
|
24,607
|
24,559
|
||||||
Total interest income on securities
|
$
|
31,083
|
$
|
30,454
|
Three Months Ended
|
||||||||
|
June 30,
2011
|
June 30,
2010
|
||||||
U.S. Treasury
|
|
$
|
5
|
$
|
2
|
|||
State and Political Subdivisions
|
|
3,215
|
3,028
|
|||||
Other Stocks and Bonds
|
|
9
|
13
|
|||||
Mortgage-backed Securities
|
13,310
|
10,282
|
||||||
Total interest income on securities
|
$
|
16,539
|
$
|
13,325
|
June 30, 2011
|
||||||||
Amortized Cost
|
Fair Value
|
|||||||
(in thousands)
|
||||||||
Available for sale securities:
|
||||||||
Investment Securities
|
||||||||
Due in one year or less
|
$ | 2,636 | $ | 2,661 | ||||
Due after one year through five years
|
7,001 | 7,188 | ||||||
Due after five years through ten years
|
25,640 | 26,728 | ||||||
Due after ten years
|
260,061 | 265,461 | ||||||
295,338 | 302,038 | |||||||
Mortgage-backed securities
|
1,108,042 | 1,136,961 | ||||||
Total
|
$ | 1,403,380 | $ | 1,438,999 |
June 30, 2011
|
||||||||
Amortized Cost
|
Fair Value
|
|||||||
(in thousands)
|
||||||||
Held to maturity securities:
|
||||||||
Investment Securities
|
||||||||
Due in one year or less
|
$ | 500 | $ | 500 | ||||
Due after one year through five years
|
– | – | ||||||
Due after five years through ten years
|
485 | 501 | ||||||
Due after ten years
|
1,011 | 1,134 | ||||||
1,996 | 2,135 | |||||||
Mortgage-backed securities
|
395,728 | 412,118 | ||||||
Total
|
$ | 397,724 | $ | 414,253 |
|
At
June 30,
|
At
December 31,
|
||||||
|
2011
|
2010
|
||||||
Real Estate Loans:
|
|
|
||||||
Construction
|
$ | 108,851 | $ | 115,094 | ||||
1-4 Family residential
|
221,283 | 219,031 | ||||||
Other
|
193,341 | 200,723 | ||||||
Commercial loans
|
134,197 | 148,761 | ||||||
Municipal loans
|
200,537 | 196,594 | ||||||
Loans to individuals
|
180,599 | 197,717 | ||||||
Total loans
|
$ | 1,038,808 | $ | 1,077,920 |
|
·
|
Satisfactory (Rating 1 – 4) – This rating is assigned to all satisfactory loans. This category, by definition, should consist of completely acceptable credit. Credit and collateral exceptions should not be present, although their presence would not necessarily prohibit a loan from being rated Satisfactory, if deficiencies are in process of correction. These loans will not be included in the Watch List.
|
|
·
|
Satisfactory (Rating 5) – Special Treatment Required – (Pass Watch) – These loans require some degree of special treatment, but not due to credit quality. This category does not include loans specially mentioned or adversely classified by the Loan Review Officer or regulatory authorities; however, particular attention must be accorded such credits due to characteristics such as:
|
|
·
|
A lack of, or abnormally extended payment program;
|
|
·
|
A heavy degree of concentration of collateral without sufficient margin;
|
|
·
|
A vulnerability to competition through lesser or extensive financial leverage;
|
|
·
|
A dependence on a single, or few customers, or sources of supply and materials without suitable substitutes or alternatives.
|
|
·
|
Special Mention (Rating 6) – A Special Mention asset has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date. Special Mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.
|
|
·
|
Substandard (Rating 7) – Substandard loans are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.
|
|
·
|
Doubtful (Rating 8) – Loans classified Doubtful have all the weaknesses inherent in those classified Substandard with the added characteristic that the weaknesses make collection or liquidation, in full, on the basis of currently known facts, conditions and values, highly questionable and improbable.
|
|
·
|
Loss (Rating 9) – Loans classified Loss are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be affected in the future.
|
|
·
|
Changes in lending policies or procedures, including underwriting, collection, charge-off, and recovery procedures;
|
|
·
|
Changes in local, regional and national economic and business conditions including entry into new markets;
|
|
·
|
Changes in the volume or type of credit extended;
|
|
·
|
Changes in the experience, ability, and depth of lending management;
|
|
·
|
Changes in the volume and severity of past due, nonaccrual, restructured, or classified loans;
|
|
·
|
Changes in loan review or Board oversight; and,
|
|
·
|
Changes in the level of concentrations of credit.
|
Six Months Ended June 30, 2011
|
||||||||||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||||||||||
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Unallocated
|
Total
|
|||||||||||||||||||||||||
Balance at beginning of period
|
$ | 2,585 | $ | 1,988 | $ | 3,354 | $ | 3,746 | $ | 607 | $ | 7,978 | $ | 453 | $ | 20,711 | ||||||||||||||||
Provision for loan losses
|
210 | 181 | (524 | ) | (231 | ) | 3 | 3,288 | 1,071 | 3,998 | ||||||||||||||||||||||
Loans charged off
|
(9 | ) | (383 | ) | (80 | ) | (927 | ) | – | (5,672 | ) | – | (7,071 | ) | ||||||||||||||||||
Recoveries of loans charged off
|
14 | 93 | 273 | 328 | – | 1,063 | – | 1,771 | ||||||||||||||||||||||||
Balance at end of period
|
$ | 2,800 | $ | 1,879 | $ | 3,023 | $ | 2,916 | $ | 610 | $ | 6,657 | $ | 1,524 | $ | 19,409 |
Three Months Ended June 30, 2011
|
||||||||||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||||||||||
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Unallocated
|
Total
|
|||||||||||||||||||||||||
Balance at beginning of period
|
$ | 2,832 | $ | 1,808 | $ | 3,321 | $ | 3,497 | $ | 605 | $ | 7,121 | $ | 596 | $ | 19,780 | ||||||||||||||||
Provision for loan losses
|
(37 | ) | 107 | (376 | ) | (421 | ) | 5 | 1,654 | 928 | 1,860 | |||||||||||||||||||||
Loans charged off
|
(9 | ) | (64 | ) | – | (377 | ) | – | (2,573 | ) | – | (3,023 | ) | |||||||||||||||||||
Recoveries of loans charged off
|
14 | 28 | 78 | 217 | – | 455 | – | 792 | ||||||||||||||||||||||||
Balance at end of period
|
$ | 2,800 | $ | 1,879 | $ | 3,023 | $ | 2,916 | $ | 610 | $ | 6,657 | $ | 1,524 | $ | 19,409 |
Six Months Ended June 30, 2010
|
||||||||||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||||||||||
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Unallocated
|
Total
|
|||||||||||||||||||||||||
Balance at beginning of period
|
$ | 3,080 | $ | 1,460 | $ | 3,175 | $ | 3,184 | $ | 400 | $ | 7,321 | $ | 1,276 | $ | 19,896 | ||||||||||||||||
Provision for loan losses
|
(192 | ) | 471 | 359 | 991 | 114 | 4,396 | (12 | ) | 6,127 | ||||||||||||||||||||||
Loans charged off
|
(873 | ) | (116 | ) | (200 | ) | (965 | ) | – | (6,321 | ) | – | (8,475 | ) | ||||||||||||||||||
Recoveries of loans charged off
|
165 | 5 | – | 157 | – | 1,408 | – | 1,735 | ||||||||||||||||||||||||
Balance at end of period
|
$ | 2,180 | $ | 1,820 | $ | 3,334 | $ | 3,367 | $ | 514 | $ | 6,804 | $ | 1,264 | $ | 19,283 |
Three Months Ended June 30, 2010 | ||||||||||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||||||||||
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Unallocated
|
Total
|
|||||||||||||||||||||||||
Balance at beginning of period
|
$ | 2,417 | $ | 1,589 | $ | 3,119 | $ | 3,219 | $ | 514 | $ | 7,267 | $ | 1,343 | $ | 19,468 | ||||||||||||||||
Provision for loan losses
|
(387 | ) | 237 | 215 | 401 | – | 1,873 | (79 | ) | 2,260 | ||||||||||||||||||||||
Loans charged off
|
– | (8 | ) | – | (352 | ) | – | (3,189 | ) | – | (3,549 | ) | ||||||||||||||||||||
Recoveries of loans charged off
|
150 | 2 | – | 99 | – | 853 | – | 1,104 | ||||||||||||||||||||||||
Balance at end of period
|
$ | 2,180 | $ | 1,820 | $ | 3,334 | $ | 3,367 | $ | 514 | $ | 6,804 | $ | 1,264 | $ | 19,283 |
Six Months Ended June 30, 2011
|
||||||||||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||||||||||
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Unallocated
|
Total
|
|||||||||||||||||||||||||
Ending balance – individually evaluated for impairment
|
$ | 1,154 | $ | 818 | $ | 635 | $ | 1,275 | $ | 118 | $ | 444 | $ | – | $ | 4,444 | ||||||||||||||||
Ending balance – collectively evaluated for impairment
|
1,646 | 1,061 | 2,388 | 1,641 | 492 | 6,213 | 1,524 | 14,965 | ||||||||||||||||||||||||
Balance at end of period
|
$ | 2,800 | $ | 1,879 | $ | 3,023 | $ | 2,916 | $ | 610 | $ | 6,657 | $ | 1,524 | $ | 19,409 |
|
Six Months Ended June 30, 2010
|
|||||||||||||||||||||||||||||||
Real Estate
|
||||||||||||||||||||||||||||||||
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Unallocated
|
Total
|
|||||||||||||||||||||||||
Ending balance – individually evaluated for impairment
|
$ | 921 | $ | 684 | $ | 815 | $ | 1,466 | $ | 133 | $ | 567 | $ | – | $ | 4,586 | ||||||||||||||||
Ending balance – collectively evaluated for impairment
|
1,259 | 1,136 | 2,519 | 1,901 | 381 | 6,237 | 1,264 | 14,697 | ||||||||||||||||||||||||
Balance at end of period
|
$ | 2,180 | $ | 1,820 | $ | 3,334 | $ | 3,367 | $ | 514 | $ | 6,804 | $ | 1,264 | $ | 19,283 |
Six Months Ended June 30,
|
||||||||
|
|
2011
|
2010
|
|||||
Reserve For Unfunded Loan Commitments:
|
||||||||
Balance at beginning of period
|
$
|
30
|
$
|
5
|
||||
Provision for losses on unfunded loan commitments
|
(8
|
)
|
35
|
|||||
Balance at end of period
|
$
|
22
|
$
|
40
|
Three Months Ended June 30,
|
||||||||
|
|
2011
|
2010
|
|||||
Reserve For Unfunded Loan Commitments:
|
||||||||
Balance at beginning of period
|
$
|
30
|
$
|
20
|
||||
Provision for losses on unfunded loan commitments
|
(8
|
)
|
20
|
|||||
Balance at end of period
|
$
|
22
|
$
|
40
|
Real Estate
|
||||||||||||||||||||||||||||
June 30, 2011
|
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Total
|
|||||||||||||||||||||
Loans individually evaluated for impairment
|
$ | 8,285 | $ | 8,488 | $ | 7,857 | $ | 6,514 | $ | 709 | $ | 1,460 | $ | 33,313 | ||||||||||||||
Loans collectively evaluated for impairment
|
100,566 | 212,795 | 185,484 | 127,683 | 199,828 | 179,139 | 1,005,495 | |||||||||||||||||||||
Total ending loans balance
|
$ | 108,851 | $ | 221,283 | $ | 193,341 | $ | 134,197 | $ | 200,537 | $ | 180,599 | $ | 1,038,808 |
Real Estate
|
||||||||||||||||||||||||||||
December 31, 2010
|
Construction
|
1-4 Family Residential
|
Other
|
Commercial Loans
|
Municipal Loans
|
Loans to Individuals
|
Total
|
|||||||||||||||||||||
Loans individually evaluated for impairment
|
$ | 10,355 | $ | 8,331 | $ | 10,688 | $ | 12,144 | $ | 738 | $ | 1,625 | $ | 43,881 | ||||||||||||||
Loans collectively evaluated for impairment
|
104,739 | 210,700 | 190,035 | 136,617 | 195,856 | 196,092 | 1,034,039 | |||||||||||||||||||||
Total ending loans balance
|
$ | 115,094 | $ | 219,031 | $ | 200,723 | $ | 148,761 | $ | 196,594 | $ | 197,717 | $ | 1,077,920 |
June 30, 2011
|
Pass
|
Pass Watch
|
Special Mention
|
Substandard
|
Doubtful
|
Loss
|
Total
|
|||||||||||||||||||||
Real Estate Loans:
|
||||||||||||||||||||||||||||
Construction
|
$ | 100,454 | $ | 747 | $ | 594 | $ | 6,980 | $ | 76 | $ | – | $ | 108,851 | ||||||||||||||
1-4 Family residential
|
212,906 | 871 | 1,236 | 5,650 | 620 | – | 221,283 | |||||||||||||||||||||
Other
|
185,484 | 95 | 3,285 | 4,172 | 305 | – | 193,341 | |||||||||||||||||||||
Commercial loans
|
127,683 | 1,825 | 268 | 4,294 | 127 | – | 134,197 | |||||||||||||||||||||
Municipal loans
|
199,829 | 258 | – | 450 | – | – | 200,537 | |||||||||||||||||||||
Loans to individuals
|
168,536 | 8,084 | – | 2,679 | 1,278 | 22 | 180,599 | |||||||||||||||||||||
Total
|
$ | 994,892 | $ | 11,880 | $ | 5,383 | $ | 24,225 | $ | 2,406 | $ | 22 | $ | 1,038,808 |
December 31, 2010
|
Pass
|
Pass Watch
|
Special Mention
|
Substandard
|
Doubtful
|
Loss
|
Total
|
|||||||||||||||||||||
Real Estate Loans:
|
||||||||||||||||||||||||||||
Construction
|
$ | 104,739 | $ | 761 | $ | 1,420 | $ | 8,174 | $ | – | $ | – | $ | 115,094 | ||||||||||||||
1-4 Family residential
|
210,699 | 812 | 1,379 | 5,332 | 809 | – | 219,031 | |||||||||||||||||||||
Other
|
190,036 | 102 | 4,784 | 5,418 | 298 | 85 | 200,723 | |||||||||||||||||||||
Commercial loans
|
136,617 | 2,273 | 1,224 | 8,403 | 199 | 45 | 148,761 | |||||||||||||||||||||
Municipal loans
|
195,856 | 258 | – | 480 | – | – | 196,594 | |||||||||||||||||||||
Loans to individuals
|
182,174 | 8,766 | 27 | 4,564 | 2,175 | 11 | 197,717 | |||||||||||||||||||||
Total
|
$ | 1,020,121 | $ | 12,972 | $ | 8,834 | $ | 32,371 | $ | 3,481 | $ | 141 | $ | 1,077,920 |
At
June 30,
2011
|
At
December 31,
2010
|
|||||||
(in thousands)
|
||||||||
|
|
|||||||
Nonaccrual loans
|
$ | 13,208 | $ | 14,524 | ||||
Accruing loans past due more than 90 days
|
8 | 7 | ||||||
Restructured loans
|
1,757 | 2,320 | ||||||
Other real estate owned
|
412 | 220 | ||||||
Repossessed assets
|
318 | 638 | ||||||
Total Nonperforming Assets
|
$ | 15,703 | $ | 17,709 |
June 30, 2011
|
December 31, 2010
|
|||||||||||||||
Nonaccrual
|
Accruing Loans Past Due More Than 90 Days
|
Nonaccrual
|
Accruing Loans Past Due More Than 90 Days
|
|||||||||||||
Real Estate Loans:
|
||||||||||||||||
Construction
|
$ | 3,983 | $ | – | $ | 4,730 | $ | – | ||||||||
1-4 Family residential
|
2,741 | – | 2,353 | – | ||||||||||||
Other
|
2,194 | – | 1,428 | – | ||||||||||||
Commercial loans
|
1,797 | – | 1,799 | – | ||||||||||||
Loans to individuals
|
2,493 | 8 | 4,214 | 7 | ||||||||||||
Total
|
$ | 13,208 | $ | 8 | $ | 14,524 | $ | 7 |
30-59 Days Past Due
|
60-89 Days Past Due
|
Greater than 90 Days Past Due
|
Total Past Due
|
Loans Not Past Due
|
Total
|
|||||||||||||||||||
Real Estate Loans:
|
||||||||||||||||||||||||
Construction
|
$ | 867 | $ | 211 | $ | 3,983 | $ | 5,061 | $ | 103,790 | $ | 108,851 | ||||||||||||
1-4 Family residential
|
3,578 | 721 | 2,741 | 7,040 | 214,243 | 221,283 | ||||||||||||||||||
Other
|
595 | 170 | 2,194 | 2,959 | 190,382 | 193,341 | ||||||||||||||||||
Commercial loans
|
1,233 | 155 | 1,797 | 3,185 | 131,012 | 134,197 | ||||||||||||||||||
Municipal loans
|
– | – | – | – | 200,537 | 200,537 | ||||||||||||||||||
Loans to individuals
|
3,116 | 793 | 2,501 | 6,410 | 174,189 | 180,599 | ||||||||||||||||||
Total
|
$ | 9,389 | $ | 2,050 | $ | 13,216 | $ | 24,655 | $ | 1,014,153 | $ | 1,038,808 |
June 30,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Loans with no allocated allowance for loan losses
|
$ | 27 | $ | 69 | ||||
Loans with allocated allowance for loan losses
|
14,903 | 16,699 | ||||||
Total
|
$ | 14,930 | $ | 16,768 | ||||
Amount of the allowance for loan losses allocated
|
$ | 3,142 | $ | 3,864 |
June 30, 2011
|
||||||||
Interest Income Recognized
|
Accruing Interest at Original Contracted Rate
|
|||||||
Real Estate Loans:
|
||||||||
Construction
|
$ | 6 | $ | 143 | ||||
1-4 Family residential
|
47 | 85 | ||||||
Other
|
29 | 87 | ||||||
Commercial loans
|
5 | 43 | ||||||
Municipal loans
|
– | – | ||||||
Loans to individuals
|
253 | 447 | ||||||
Total
|
$ | 340 | $ | 805 |
June 30, 2011
|
Unpaid Contractual Principal Balance
|
Recorded Investment With No Allowance
|
Recorded Investment With Allowance
|
Total Recorded Investment
|
Loan Losses Allocated
|
Average Recorded Investment
|
||||||||||||||||||
Real Estate Loans:
|
||||||||||||||||||||||||
Construction
|
$ | 4,829 | $ | – | $ | 3,983 | $ | 3,983 | $ | 591 | $ | 4,155 | ||||||||||||
1-4 Family residential
|
2,819 | – | 2,741 | 2,741 | 489 | 2,524 | ||||||||||||||||||
Other
|
2,606 | – | 2,194 | 2,194 | 227 | 1,865 | ||||||||||||||||||
Commercial loans
|
1,850 | – | 1,797 | 1,797 | 684 | 1,876 | ||||||||||||||||||
Municipal loans
|
– | – | – | – | – | – | ||||||||||||||||||
Loans to individuals
|
4,399 | 27 | 4,188 | 4,215 | 1,151 | 5,409 | ||||||||||||||||||
Total
|
$ | 16,503 | $ | 27 | $ | 14,903 | $ | 14,930 | $ | 3,142 | $ | 15,829 |
December 31, 2010
|
Unpaid Contractual Principal Balance
|
Recorded Investment With No Allowance
|
Recorded Investment With Allowance
|
Total Recorded Investment
|
Loan Losses Allocated
|
Average Recorded Investment
|
||||||||||||||||||
Real Estate Loans:
|
||||||||||||||||||||||||
Construction
|
$ | 6,045 | $ | – | $ | 4,730 | $ | 4,730 | $ | 562 | $ | 6,013 | ||||||||||||
1-4 Family residential
|
2,453 | – | 2,354 | 2,354 | 426 | 1,250 | ||||||||||||||||||
Other
|
1,807 | – | 1,428 | 1,428 | 179 | 1,445 | ||||||||||||||||||
Commercial loans
|
1,826 | – | 1,799 | 1,799 | 719 | 1,950 | ||||||||||||||||||
Municipal loans
|
– | – | – | – | – | – | ||||||||||||||||||
Loans to individuals
|
6,854 | 69 | 6,388 | 6,457 | 1,978 | 7,904 | ||||||||||||||||||
Total
|
$ | 18,985 | $ | 69 | $ | 16,699 | $ | 16,768 | $ | 3,864 | $ | 18,562 |
June 30,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
FHLB Advances
(1)
|
$ | 277,979 | $ | 373,479 | ||||
Long-term Debt
(2)
|
||||||||
Southside Statutory Trust III Due 2033
(3)
|
20,619 | 20,619 | ||||||
Southside Statutory Trust IV Due 2037
(4)
|
23,196 | 23,196 | ||||||
Southside Statutory Trust V Due 2037
(5)
|
12,887 | 12,887 | ||||||
Magnolia Trust Company I Due 2035
(6)
|
3,609 | 3,609 | ||||||
Total Long-term Debt
|
60,311 | 60,311 | ||||||
Total Long-term Obligations
|
$ | 338,290 | $ | 433,790 |
|
(1)
|
At June 30, 2011, the weighted average cost of these advances was 3.61%. FHLB Advances have maturities ranging from July 2012 through July 2028.
|
|
(2)
|
This long-term debt consists of trust preferred securities that qualify under the risk-based capital guidelines as Tier 1 capital, subject to certain limitations.
|
|
(3)
|
This debt carries an adjustable rate of 3.18575% through September 29, 2011 and adjusts quarterly at a rate equal to three-month LIBOR plus 294 basis points.
|
|
(4)
|
This debt carries a fixed rate of 6.518% through October 30, 2012 and thereafter, adjusts quarterly at a rate equal to three-month LIBOR plus 130 basis points.
|
|
(5)
|
This debt carries a fixed rate of 7.48% through December 15, 2012 and thereafter, adjusts quarterly at a rate equal to three-month LIBOR plus 225 basis points.
|
|
(6)
|
This debt carries an adjustable rate of 2.0585% through August 22, 2011 and thereafter, adjusts quarterly at a rate equal to three-month LIBOR plus 180 basis points.
|
Advance Commitment
|
Option Expiration Date
|
Advance Commitment Term at Exercise Date
|
Advance
Commitment
Rate
|
Option Fee Paid
|
||||||
$
|
25,000
|
09/20/12
|
36 months
|
1.325%
|
$
|
1,105
|
||||
25,000
|
09/20/12
|
48 months
|
1.674%
|
1,410
|
||||||
20,000
|
10/09/12
|
36 months
|
1.153%
|
789
|
||||||
20,000
|
10/09/12
|
48 months
|
1.466%
|
1,042
|
||||||
20,000
|
10/09/12
|
60 months
|
1.807%
|
1,216
|
||||||
20,000
|
05/17/12
|
48 months
|
1.710%
|
917
|
||||||
20,000
|
05/17/12
|
60 months
|
2.085%
|
1,102
|
||||||
20,000
|
03/18/13
|
60 months
|
2.510%
|
1,528
|
||||||
15,000
|
03/18/13
|
36 months
|
1.622%
|
828
|
||||||
15,000
|
03/18/13
|
48 months
|
2.086%
|
1,017
|
||||||
$
|
200,000
|
$
|
10,954
|
|
|
Six Months Ended June 30,
|
|
|||||||||||||
|
|
Defined Benefit
|
|
|
|
|
|
|
|
|||||||
|
|
Pension Plan
|
|
|
Restoration Plan
|
|
||||||||||
|
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
2010
|
|
||||
Service cost
|
|
$
|
768
|
|
$
|
681
|
|
$
|
87
|
|
$
|
77
|
||||
Interest cost
|
|
|
1,490
|
|
|
1,416
|
|
|
198
|
|
|
192
|
||||
Expected return on assets
|
|
|
(1,941
|
)
|
|
|
(1,826
|
)
|
|
|
–
|
|
|
–
|
||
Net loss recognition
|
|
|
581
|
|
|
503
|
|
|
151
|
|
|
145
|
||||
Prior service credit amortization
|
|
|
(21
|
)
|
|
|
(21
|
)
|
|
|
(1
|
)
|
|
|
(1
|
)
|
Net periodic benefit cost
|
|
$
|
877
|
|
$
|
753
|
|
$
|
435
|
|
$
|
413
|
|
|
Three Months Ended June 30,
|
|
|||||||||||||
|
|
Defined Benefit
|
|
|
|
|
|
|
|
|||||||
|
|
Pension Plan
|
|
|
Restoration Plan
|
|
||||||||||
|
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
2010
|
|
||||
Service cost
|
|
$
|
374
|
|
$
|
342
|
|
$
|
44
|
|
$
|
48
|
||||
Interest cost
|
|
|
749
|
|
|
738
|
|
|
98
|
|
|
120
|
||||
Expected return on assets
|
|
|
(969
|
)
|
|
|
(947
|
)
|
|
|
–
|
|
|
–
|
||
Net loss recognition
|
|
|
296
|
|
|
290
|
|
|
70
|
|
|
100
|
||||
Prior service credit amortization
|
|
|
(11
|
)
|
|
|
(11
|
)
|
|
|
–
|
|
|
–
|
||
Net periodic benefit cost
|
|
$
|
439
|
|
$
|
412
|
|
$
|
212
|
|
$
|
268
|
Restricted Stock Units
Outstanding
|
Stock Options
Outstanding
|
|||||||||||||||||||
Shares Available
for Grant
|
Number
of Shares
|
Weighted-Average Grant-Date Fair Value
|
Number
of Shares
|
Weighted-Average Exercise Price
|
||||||||||||||||
Balance, January 2011
|
1,157,625 | – | $ | – | 10,825 | $ | 10.38 | |||||||||||||
Granted
|
(204,202 | ) | 33,392 | 19.19 | 170,810 | 19.19 | ||||||||||||||
Stock options exercised
|
– | – | – | (838 | ) | 10.38 | ||||||||||||||
Stock awards vested
|
– | – | – | – | – | |||||||||||||||
Forfeited
|
– | – | – | – | – | |||||||||||||||
Canceled/expired
|
– | – | – | – | – | |||||||||||||||
Balance, June 30, 2011
|
953,423 | 33,392 | $ | 19.19 | 180,797 | $ | 18.70 |
Options Outstanding
|
Options Exercisable
|
|||||||||||||||||||||
Range of Exercise Prices
|
Number
of Shares
|
Weighted-Average Exercise Price
|
Weighted-Average Remaining Contractual Life in Years
|
Number
of Shares
|
Weighted-Average Exercise Price
|
|||||||||||||||||
$ | 10.38 – 10.38 | 9,987 | $ | 10.38 | 1.75 | 9,987 | $ | 10.38 | ||||||||||||||
19.19 – 19.19 | 170,810 | 19.19 | 9.94 | – | – | |||||||||||||||||
Total
|
180,797 | $ | 18.70 | 9.49 | 9,987 | $ | 10.38 |
At June 30,
|
At December 31,
|
At June 30,
|
||||||||||
2011
|
2010
|
2010
|
||||||||||
Carrying Value
|
$ | 14,930 | $ | 16,768 | $ | 18,354 | ||||||
Valuation Allowance
|
3,142 | 3,864 | 3,675 | |||||||||
Total Reported Fair Value
|
$ | 11,788 | $ | 12,904 | $ | 14,679 |
As of June 30, 2011
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Securities Available For Sale
|
Input
|
Input
|
Input
|
Fair Value
|
||||||||||||
Investment Securities:
|
||||||||||||||||
State and Political Subdivisions
|
$ | – | $ | 301,081 | $ | – | $ | 301,081 | ||||||||
Other Stocks and Bonds
|
– | – | 957 | 957 | ||||||||||||
Mortgage-backed Securities:
|
||||||||||||||||
U.S. Government Agencies
|
– | 162,916 | – | 162,916 | ||||||||||||
Government-Sponsored Enterprise
|
– | 974,045 | – | 974,045 | ||||||||||||
Total
|
$ | – | $ | 1,438,042 | $ | 957 | $ | 1,438,999 |
As of December 31, 2010
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Securities Available For Sale
|
Input
|
Input
|
Input
|
Fair Value
|
||||||||||||
Investment Securities:
|
||||||||||||||||
U.S. Treasury
|
$ | 4,700 | $ | – | $ | – | $ | 4,700 | ||||||||
State and Political Subdivisions
|
– | 294,262 | – | 294,262 | ||||||||||||
Other Stocks and Bonds
|
193 | – | 189 | 382 | ||||||||||||
Mortgage-backed Securities:
|
||||||||||||||||
U.S. Government Agencies
|
– | 154,534 | – | 154,534 | ||||||||||||
Government-Sponsored Enterprise
|
– | 791,509 | – | 791,509 | ||||||||||||
Total
|
$ | 4,893 | $ | 1,240,305 | $ | 189 | $ | 1,245,387 |
Six Months Ended June 30,
|
||||||||
2011
|
2010
|
|||||||
Other Stocks and Bonds
|
||||||||
Balance at Beginning of Period
|
$ | 189 | $ | 270 | ||||
Total gains or losses (realized/unrealized):
|
||||||||
Included in earnings (or changes in net assets)
|
– | (75 | ) | |||||
Included in other comprehensive income (loss)
|
768 | (8 | ) | |||||
Purchases
|
– | – | ||||||
Issuances
|
– | – | ||||||
Settlements
|
– | – | ||||||
Transfers in and/or out of Level 3
|
– | – | ||||||
Balance at End of Period
|
$ | 957 | $ | 187 | ||||
The amount of total gains or losses for the periods included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date
|
$ | – | $ | (75 | ) |
Three Months Ended June 30,
|
||||||||
2011
|
2010
|
|||||||
Other Stocks and Bonds
|
||||||||
Balance at Beginning of Period
|
$ | 1,005 | $ | 231 | ||||
Total gains or losses (realized/unrealized):
|
||||||||
Included in earnings (or changes in net assets)
|
– | – | ||||||
Included in other comprehensive income (loss)
|
(48 | ) | (44 | ) | ||||
Purchases
|
– | – | ||||||
Issuances
|
– | – | ||||||
Settlements
|
– | – | ||||||
Transfers in and/or out of Level 3
|
– | – | ||||||
Balance at End of Period
|
$ | 957 | $ | 187 | ||||
The amount of total gains or losses for the periods included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date
|
$ | – | $ | – |
At June 30, 2011
|
At December 31, 2010
|
|||||||||||||||
Carrying Amount
|
Fair Value
|
Carrying Amount
|
Fair Value
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Financial assets:
|
||||||||||||||||
Cash and cash equivalents
|
$ | 48,454 | $ | 48,454 | $ | 79,073 | $ | 79,073 | ||||||||
Investment securities:
|
||||||||||||||||
Available for sale, at estimated fair value
|
302,038 | 302,038 | 299,344 | 299,344 | ||||||||||||
Held to maturity, at amortized cost
|
1,996 | 2,135 | 1,495 | 1,553 | ||||||||||||
Mortgage-backed and related securities:
|
||||||||||||||||
Available for sale, at estimated fair value
|
1,136,961 | 1,136,961 | 946,043 | 946,043 | ||||||||||||
Held to maturity, at amortized cost
|
395,728 | 412,118 | 417,862 | 426,572 | ||||||||||||
FHLB stock and other investments, at cost
|
27,588 | 27,588 | 36,776 | 36,776 | ||||||||||||
Loans, net of allowance for loan losses
|
1,019,399 | 1,023,990 | 1,057,209 | 1,066,125 | ||||||||||||
Loans held for sale
|
2,738 | 2,738 | 6,583 | 6,583 | ||||||||||||
Financial liabilities:
|
||||||||||||||||
Retail deposits
|
$ | 2,239,537 | $ | 2,243,214 | $ | 2,134,428 | $ | 2,138,587 | ||||||||
Federal funds purchased and repurchase agreements
|
3,077 | 3,077 | 3,844 | 3,844 | ||||||||||||
FHLB advances
|
532,782 | 549,399 | 562,573 | 578,561 | ||||||||||||
Long-term debt
|
60,311 | 45,918 | 60,311 | 50,673 |
|
June 30, 2011
|
December 31, 2010
|
||||||
Unused commitments:
|
||||||||
Due in one year or less
|
$ | 79,493 | $ | 64,984 | ||||
Due after one year
|
38,654 | 48,267 | ||||||
Total
|
$ | 118,147 | $ | 113,251 |
|
·
|
general economic conditions, either globally, nationally, in the State of Texas, or in the specific markets in which we operate, including, without limitation, the deterioration of the commercial real estate, residential real estate, construction and development, credit and liquidity markets, which could cause an adverse change in our net interest margin, or a decline in the value of our assets, which could result in realized losses;
|
|
·
|
legislation, regulatory changes or changes in monetary or fiscal policy that adversely affect the businesses in which we are engaged, including the impact of the Dodd-Frank Act, the Federal Reserve’s actions with respect to interest rates and other regulatory responses to current economic conditions;
|
|
·
|
adverse changes in the status or financial stability or credit rating of the U.S. Treasury-issued securities impacting the U.S. Treasury’s guarantees or ability to pay or issue debt;
|
|
·
|
adverse changes in the status or financial condition of the Government-Sponsored Enterprises (the “GSEs”) impacting the GSEs’ guarantees or ability to pay or issue debt;
|
|
·
|
adverse changes in the credit portfolio of other U.S. financial institutions relative to the performance of certain of our investment securities;
|
|
·
|
economic or other disruptions caused by acts of terrorism in the United States, Europe or other areas;
|
|
·
|
changes in the interest rate yield curve such as flat, inverted or steep yield curves, or changes in the interest rate environment that impact interest margins and may impact prepayments on the mortgage-backed securities portfolio;
|
|
·
|
increases in our nonperforming assets;
|
|
·
|
our ability to maintain adequate liquidity to fund operations and growth;
|
|
·
|
the failure of our assumptions underlying allowance for loan losses and other estimates;
|
|
·
|
unexpected outcomes of, and the costs associated with, existing or new litigation involving us;
|
|
·
|
changes impacting our balance sheet and leverage strategy;
|
|
·
|
our ability to monitor interest rate risk;
|
|
·
|
significant increases in competition in the banking and financial services industry;
|
|
·
|
changes in consumer spending, borrowing and saving habits;
|
|
·
|
technological changes;
|
|
·
|
our ability to increase market share and control expenses;
|
|
·
|
the effect of changes in federal or state tax laws;
|
|
·
|
the effect of compliance with legislation or regulatory changes;
|
|
·
|
the effect of changes in accounting policies and practices;
|
|
·
|
risks of mergers and acquisitions including the related time and cost of implementing transactions and the potential failure to achieve expected gains, revenue growth or expense savings;
|
|
·
|
credit risks of borrowers, including any increase in those risks due to changing economic conditions; and
|
|
·
|
risks related to loans secured by real estate, including the risk that the value and marketability of collateral could decline.
|
·
|
A permanent increase in deposit insurance coverage to $250,000 per account, unlimited deposit insurance on noninterest bearing transaction accounts beginning December 31, 2010 through December 31, 2012, and an increase in the minimum Deposit Insurance Fund reserve requirement from 1.15% to 1.35%, with assessments to be based on assets as opposed to deposits.
|
·
|
New disclosure and other requirements relating to executive compensation and corporate governance.
|
·
|
Amendments to the Truth in Lending Act aimed at improving consumer protections with respect to mortgage originations, including originator compensation, minimum repayment standards, and prepayment considerations.
|
·
|
The establishment of the Financial Stability Oversight Council, which will be responsible for identifying and monitoring systemic risks posed by financial firms, activities, and practices.
|
·
|
The development of regulations to limit debit card interchange fees.
|
·
|
The future elimination of newly issued trust preferred securities as a permitted element of Tier 1 capital.
|
·
|
The creation of a special regime to allow for the orderly liquidation of systemically important financial companies, including the establishment of an orderly liquidation fund.
|
·
|
The development of regulations to address derivatives markets, including clearing and exchange trading requirements and a framework for regulating derivatives-market participants.
|
·
|
Enhanced supervision of credit rating agencies through the Office of Credit Ratings within the SEC.
|
·
|
Increased regulation of asset-backed securities, including a requirement that issuers of asset-backed securities retain at least 5% of the risk of the asset-backed securities.
|
·
|
The establishment of a Bureau of Consumer Financial Protection, within the Federal Reserve, to serve as a dedicated consumer-protection regulatory body.
|
(1)
|
Interest on loans includes fees on loans that are not material in amount.
|
(2)
|
Interest income includes taxable-equivalent adjustments of $1,948 and $1,648 for the six months ended June 30, 2011 and 2010, respectively.
|
(3)
|
Interest income includes taxable-equivalent adjustments of $3,126 and $2,859 for the six months ended June 30, 2011 and 2010, respectively.
|
(4)
|
For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.
|
(5)
|
Represents junior subordinated debentures issued by us to Southside Statutory Trust III, IV, and V in connection with the issuance by Southside Statutory Trust III of $20 million of trust preferred securities, Southside Statutory Trust IV of $22.5 million of trust preferred securities, Southside Statutory Trust V of $12.5 million of trust preferred securities and junior subordinated debentures issued by FWBS to Magnolia Trust Company I in connection with the issuance by Magnolia Trust Company I of $3.5 million of trust preferred securities.
|
(6)
|
Includes average equity of noncontrolling interest of $1,788 and $1,042 for the six months ended June 30, 2011 and 2010, respectively.
|
(1)
|
Interest on loans includes fees on loans that are not material in amount.
|
(2)
|
Interest income includes taxable-equivalent adjustments of $977 and $824 for the three months ended June 30, 2011 and 2010, respectively.
|
(3)
|
Interest income includes taxable-equivalent adjustments of $1,569 and $1,477 for the three months ended June 30, 2011 and 2010, respectively.
|
(4)
|
For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.
|
(5)
|
Represents junior subordinated debentures issued by us to Southside Statutory Trust III, IV, and V in connection with the issuance by Southside Statutory Trust III of $20 million of trust preferred securities, Southside Statutory Trust IV of $22.5 million of trust preferred securities, Southside Statutory Trust V of $12.5 million of trust preferred securities and junior subordinated debentures issued by FWBS to Magnolia Trust Company I in connection with the issuance by Magnolia Trust Company I of $3.5 million of trust preferred securities.
|
(6)
|
Includes average equity of noncontrolling interest of $2,068 and $1,235 for the three months ended June 30, 2011 and 2010, respectively.
|
|
Actual
|
For Capital
Adequacy Purposes
|
To Be Well Capitalized Under Prompt Corrective Actions Provisions
|
|||||||||||||||||||||
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||
As of June 30, 2011:
|
(dollars in thousands)
|
|||||||||||||||||||||||
Total Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
||||||||||||||||||
Consolidated
|
$ | 288,728 | 22.15 | % | $ | 104,260 | 8.00 | % | N/A | N/A | ||||||||||||||
Bank Only
|
$ | 284,313 | 21.83 | % | $ | 104,202 | 8.00 | % | $ | 130,253 | 10.00 | % | ||||||||||||
Tier 1 Capital (to Risk Weighted Assets)
|
||||||||||||||||||||||||
Consolidated
|
$ | 272,354 | 20.90 | % | $ | 52,130 | 4.00 | % | N/A | N/A | ||||||||||||||
Bank Only
|
$ | 267,939 | 20.57 | % | $ | 52,101 | 4.00 | % | $ | 78,152 | 6.00 | % | ||||||||||||
Tier 1 Capital (to Average Assets) (1)
|
||||||||||||||||||||||||
Consolidated
|
$ | 272,354 | 9.02 | % | $ | 120,770 | 4.00 | % | N/A | N/A | ||||||||||||||
Bank Only
|
$ | 267,939 | 8.88 | % | $ | 120,651 | 4.00 | % | $ | 150,813 | 5.00 | % | ||||||||||||
As of December 31, 2010:
|
||||||||||||||||||||||||
Total Capital (to Risk Weighted Assets)
|
||||||||||||||||||||||||
Consolidated
|
$ | 274,175 | 21.09 | % | $ | 103,981 | 8.00 | % | N/A | N/A | ||||||||||||||
Bank Only
|
$ | 263,186 | 20.27 | % | $ | 103,882 | 8.00 | % | $ | 129,853 | 10.00 | % | ||||||||||||
Tier 1 Capital (to Risk Weighted Assets)
|
||||||||||||||||||||||||
Consolidated
|
$ | 257,837 | 19.84 | % | $ | 51,991 | 4.00 | % | N/A | N/A | ||||||||||||||
Bank Only
|
$ | 246,848 | 19.01 | % | $ | 51,941 | 4.00 | % | $ | 77,912 | 6.00 | % | ||||||||||||
Tier 1 Capital (to Average Assets) (1)
|
||||||||||||||||||||||||
Consolidated
|
$ | 257,837 | 8.45 | % | $ | 122,026 | 4.00 | % | N/A | N/A | ||||||||||||||
Bank Only
|
$ | 246,848 | 8.10 | % | $ | 121,893 | 4.00 | % | $ | 152,367 | 5.00 | % |
At
|
At
|
At
|
||||||||||
June 30,
|
December 31,
|
June 30,
|
||||||||||
2011
|
2010
|
2010
|
||||||||||
(in thousands)
|
||||||||||||
Real Estate Loans:
|
|
|
|
|||||||||
Construction
|
$ | 108,851 | $ | 115,094 | $ | 104,866 | ||||||
1-4 Family Residential
|
221,283 | 219,031 | 217,131 | |||||||||
Other
|
193,341 | 200,723 | 204,837 | |||||||||
Commercial Loans
|
134,197 | 148,761 | 156,032 | |||||||||
Municipal Loans
|
200,537 | 196,594 | 155,283 | |||||||||
Loans to Individuals
|
180,599 | 197,717 | 179,303 | |||||||||
Total Loans
|
$ | 1,038,808 | $ | 1,077,920 | $ | 1,017,452 |
At
June 30,
2011
|
At
December 31,
2010
|
At
June 30,
2010
|
||||||||||
(in thousands) | ||||||||||||
|
|
|
||||||||||
Nonaccrual loans
|
$ | 13,208 | $ | 14,524 | $ | 15,728 | ||||||
Accruing loans past due more than 90 days
|
8 | 7 | 19 | |||||||||
Restructured loans
|
1,757 | 2,320 | 2,671 | |||||||||
Other real estate owned
|
412 | 220 | 1,097 | |||||||||
Repossessed assets
|
318 | 638 | 208 | |||||||||
Total Nonperforming Assets
|
$ | 15,703 | $ | 17,709 | $ | 19,723 |
At
June 30,
2011
|
At
December 31,
2010
|
At
June 30,
2010
|
||||||||||
(unaudited)
|
||||||||||||
Asset Quality Ratios:
|
||||||||||||
|
|
|||||||||||
Nonaccruing loans to total loans
|
1.27 | % | 1.35 | % | 1.55 | % | ||||||
Allowance for loan losses to nonaccruing loans
|
146.95 | 142.60 | 122.60 | |||||||||
Allowance for loan losses to nonperforming assets
|
123.60 | 116.95 | 97.77 | |||||||||
Allowance for loan losses to total loans
|
1.87 | 1.92 | 1.90 | |||||||||
Nonperforming assets to total assets
|
0.50 | 0.59 | 0.66 | |||||||||
Net charge-offs to average loans
|
1.01 | 1.25 | 1.33 |
ITEM 1.
|
ITEM 1A.
|
ITEM 3.
|
ITEM 4.
|
ITEM 5.
|
OTHER
INFORMATION
|
ITEM 6.
|
Exhibit No.
|
||
3 (a)
|
–
|
Amended and Restated Articles of Incorporation of Southside Bancshares, Inc. effective April 17, 2009 (filed as Exhibit 3(a) to the Registrant's Form 8-K, filed April 20, 2009, and incorporated herein by reference).
|
|
SOUTHSIDE BANCSHARES, INC.
|
|
|
|
|
|
|
|
|
BY:
|
/s/ B. G. HARTLEY
|
|
|
B. G. Hartley, Chairman of the Board
|
|
|
and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
DATE: August 8, 2011
|
|
|
||
|
|
|
|
|
|
|
BY:
|
/s/ LEE R. GIBSON
|
|
|
Lee R. Gibson, CPA, Senior Executive Vice President and Chief Financial Officer (Principal
Financial Officer)
|
|
|
|
|
|
|
|
|
|
DATE: August 8, 2011
|
|
Exhibit Number
|
Description
|
|
Form of Nonstatutory Stock Option Award Certificate under the Southside Bancshares, Inc. 2009 Incentive Plan
|
||
Form of Restricted Stock Unit Award Certificate under the Southside Bancshares, Inc. 2009 Incentive Plan
|
||
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
||
**101.INS
|
XBRL Instance Document
|
|
**101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
**101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
**101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
**101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
**101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
Continuous Service
after Grant Date
|
Percent of Option Shares Vested
|
SOUTHSIDE BANCSHARES, INC.
|
Grant Date: | ||
By:
|
|||
Its:
|
Authorized Officer
|
Continuous Service
after Grant Date
|
Percent of Units Vested
|
SOUTHSIDE BANCSHARES, INC.
|
Grant Date: | ||
By:
|
|||
Its:
|
Authorized Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Southside Bancshares, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 8, 2011
|
By:
|
/s/ B. G. HARTLEY
|
|
|
B. G. Hartley
|
|
|
Chairman of the Board and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Southside Bancshares, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 8, 2011
|
By:
|
/s/ LEE R. GIBSON
|
|
|
Lee R. Gibson, CPA
|
|
|
Senior Executive Vice President and Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Registrant.
|
Date: August 8, 2011
|
By:
|
/s/ B. G. HARTLEY
|
|
|
B. G. Hartley
|
|
|
Chairman of the Board and Chief Executive Officer
|
Date: August 8, 2011
|
By:
|
/s/ LEE R. GIBSON
|
|
|
Lee R. Gibson, CPA
|
|
|
Senior Executive Vice President and Chief Financial Officer
|