Investor Relation - Press Release

Investor Relation

Press Release

WesBanco Announces Fourth Quarter and Full Year 2016 Net Income

Company Release - 1/24/2017 4:15 PM ET

WHEELING, W.Va., Jan. 24, 2017 /PRNewswire/ -- Todd F. Clossin, President and Chief Executive Officer of WesBanco, Inc. (NASDAQ: WSBC), a multi-state bank holding company based in Wheeling, WV, today announced net income and related earnings per share for the three and twelve months ended December 31, 2016.  Net income for 2016 was $86.6 million or $2.16 per diluted share compared to $80.8 million or $2.15 per diluted share for 2015.  Net income for the three months ended December 31, 2016 was $24.2 million, while diluted earnings per share were $0.55, compared to $23.0 million or $0.60 per diluted share for the fourth quarter of 2015.  Excluding after-tax merger-related expenses (non-GAAP measure) for 2016, net income increased 8.3% to $95.3 million compared to $88.0 million for 2015, while diluted earnings per share totaled $2.37, compared to $2.34 per share for 2015.  Excluding after-tax merger-related expenses (non-GAAP measure), net income for the three months ended December 31, 2016 was $26.0 million, while diluted earnings per share were $0.59, compared to $23.0 million or $0.60 per diluted share for the fourth quarter of 2015.

 




For the Three Months Ended December 31, 


For the Twelve Months Ended December 31,




2016


2015


2016


2015

(unaudited, dollars in thousands,
except per share amounts)


Net Income


Diluted
Earnings
Per Share


Net Income


Diluted
Earnings
Per Share


Net Income


Diluted
Earnings
Per Share


Net Income


Diluted
Earnings
Per Share

Net income (Non-GAAP)(1)


$    25,963


$       0.59


$    23,033


$       0.60


$      95,254


$       2.37


$      87,965


$       2.34

Less: After tax merger-related expenses


(1,745)


(0.04)


(31)


-


(8,619)


(0.21)


(7,203)


(0.19)

Net income (GAAP)



$    24,218


$       0.55


$      23,002


$       0.60


$      86,635


$       2.16


$      80,762


$       2.15

(1)Non-GAAP net income excludes after-tax merger related expenses.  Non-GAAP measures are defined on page 11 under "Non-GAAP Financial Measures."

 

Financial results for Your Community Bankshares, Inc. ("YCB") were included in WesBanco's results after September 9, 2016, the date of the consummation of the merger.  The merger, which was announced on May 3, 2016, was approved by all appropriate regulatory agencies and the shareholders of YCB before the end of August, permitting the transaction to be closed in slightly over four months. YCB, with approximately $1.5 billion of assets, was headquartered in New Albany, IN and operated through 34 financial centers in Indiana and Kentucky.  The YCB merger meshes well with WesBanco's strategic growth plans and contiguous market expansion, and expands the WesBanco franchise into new attractive growth markets.  WesBanco now has $9.8 billion in total assets and provides banking services through 174 branch locations in five states.  WesBanco's results also include ESB Financial Corporation's ("ESB") results from February 10, 2015, the date of consummation of that merger.

"I am pleased to report that we successfully converted Your Community Bank with the integration and branding of our products, services, systems, and processes," said Mr. Clossin.  "We remain excited about the opportunities our newest markets in Indiana and Kentucky provide, and are encouraged by the enthusiasm of our newest employees."

Mr. Clossin added, "2016 was another successful year for WesBanco.  We have strong market share in our legacy markets, including several major metropolitan areas across five states.  We continue to manage operating expenses diligently as evidenced by our year-to-date efficiency ratio of 56.7%.  Lastly, our strong risk and compliance framework, coupled with our diversification and balanced growth, helped us to once again be named one of America's Best Banks during 2017 by a leading financial magazine. We are excited about our opportunities for the upcoming year, and look forward to a continuation of our stated strategies as we provide additional value to our customers and shareholders."

Financial Condition

Total assets at December 31, 2016 increased $1.3 billion or 15.6% compared to December 31, 2015 due to the acquisition of YCB.   Management remains focused on controlling overall growth, primarily through control of the securities portfolio, in order to manage the financial impact of crossing $10 billion in assets. Portfolio loans increased $1.2 billion or 23.4% over the last twelve months with $1.0 billion from the YCB acquisition and $171.9 million, or 3.4% from organic loan growth. Expanded market areas and additional commercial personnel in our core markets provided the organic loan growth, which occurred primarily in commercial real estate, commercial and industrial and home equity lending categories, and was achieved through $2.0 billion in loan originations in 2016, partially offset by certain large commercial real estate payoffs.  Total business loan originations were up approximately 26.7% compared to 2015.  The re-mix in average earning assets continued as securities as a percentage of total assets were reduced from 28.6% at December 31, 2015 to 23.7% at December 31, 2016, while loans have increased as a percentage of total assets to 63.8%.

Total deposits increased $974.6 million or 16.1% during the last twelve months, reflecting $1.2 billion from the YCB acquisition and our stated balance sheet strategy.  Total organic deposits, excluding CDs, increased 2.3%, driven by 10.8% organic growth in interest bearing and non-interest bearing demand deposits.  Reflecting customer preferences, total demand deposits, as of December 31, 2016, now represent 47.4% of total deposits, an increase from 40.6% a year ago.

WesBanco continues to maintain strong regulatory capital ratios after the YCB acquisition and implementation of the BASEL III capital standards.  At December 31, 2016, Tier I leverage was 9.81%, Tier I Risk-Based capital was 13.16%, Total Risk-Based capital was 14.18% and the Common Equity Tier 1 capital ratio ("CET 1"), was 11.28%.  Both consolidated and bank-level regulatory capital ratios are well above the applicable "well-capitalized" standards promulgated by bank regulators and the BASEL III capital standards. Total tangible equity to tangible assets (non-GAAP measure) was 8.20% at December 31, 2016, increasing from 7.95% at December 31, 2015, which reflects the acquisition of YCB and lower accumulated other comprehensive income.  Strong earnings and increased total capital have enabled WesBanco to increase the quarterly dividend rate, currently at $0.24 per share, nine times over the last six years, cumulatively representing a 71% increase.  The most recent increase was $0.01 per share per quarter in the first quarter of 2016.

Credit Quality

While the provision for credit losses increased by 1.5% in 2016, primarily due to loan growth, credit metrics continued to improve.  The provision for credit losses increased to $8.5 million in 2016, compared to $8.4 million in 2015. Net charge-offs as a percentage of average portfolio loans of 0.12% in 2016 decreased from 0.23% in 2015.

Non-performing loans (including TDRs), criticized and classified loans all improved as a percentage of total portfolio loans from December 31 2015. Total non-performing loans were 0.63% of total loans at December 31, 2016, decreasing from 0.89% of total loans at the end of 2015. Criticized and classified loans were 1.20% of total loans, improving from 1.57% at December 31, 2015. Past due loans at December 31, 2016 were 0.32% of total loans, minimally higher than the 0.28% at December 31, 2015, primarily due to higher delinquencies on the YCB acquired portfolio due to the administrative transition.

The allowance for loan losses represented 0.70% of total portfolio loans at December 31, 2016 compared to 0.82% as of December 31, 2015.  If the acquired YCB and ESB loans (recorded at fair value at the date of acquisition of $1,713.1 million) were excluded from the ratio, the allowance would approximate 0.96% of the adjusted loan total at December 31, 2016 compared to 1.09% prior to the ESB acquisition.

Net Interest Income

The net interest margin increased by 10 basis points to 3.42% in the fourth quarter of 2016 compared to the third quarter of 2016 as a result of higher yielding assets acquired through the acquisition. The increased yield on assets in the fourth quarter of 2016 of 15 basis points more than offset an 8 basis point increase in the cost of interest bearing liabilities as compared to fourth quarter of 2015. Net interest income increased $11.1 million or 18.3% in fourth quarter of 2016 compared to fourth quarter of 2015 due to a 25.2% increase in average loan balances resulting in a 14.4% increase in average earning assets, partially due to a 10 basis point increase in the net interest margin.  The increase in average loan balances in 2016 was due to a combination of the acquisition and the 3.4% organic loan growth highlighted by 6.2% of commercial loan growth.

The year-over-year net interest margin decreased to 3.32% in 2016 compared to 3.41% in 2015. This decrease in the net interest margin is primarily due to 10 basis points of increased funding costs and an asset yield decline of 2 basis points.  Total average loan rates decreased by 9 basis points year-over-year due to repricing of existing loans at lower spreads, competitive pricing on new loans and the extended low interest rate environment.  The funding cost increase of 10 basis points in 2016, compared to 2015, is primarily due to an increase in the percentage of borrowings, primarily FHLB, to 19.8% of interest bearing liabilities from 14.3% in 2015, as well as a 27 basis point increase in the average total cost of these borrowings year-over-year. Average interest bearing deposits in 2016 increased 1.1%, as increases in interest bearing demand and savings accounts more than offset declines in CDs and money market accounts.  During the last few quarters, the net interest margin has been relatively stable, ranging from 3.29% to 3.42% with improvements in the most recent quarter. 

Non-Interest Income

For 2016, non-interest income increased $7.0 million or 9.4% compared to 2015.  Service charges on deposits increased $1.6 million or 9.5% and electronic banking fees increased $1.2 million or 8.6% through a larger customer deposit base from the addition of YCB.  Net securities gains increased $1.4 million in 2016 compared to 2015, primarily due to increased calls of agency notes.  Net securities brokerage revenue decreased $1.2 million or 16.2% primarily as a result of our strategy to retain deposits. Other income increased $4.2 million due to a $2.7 million increase of commercial customer loan swap fee and market value related income and improvement in various other income categories.

Non-Interest Expense

The following comments on non-interest expense exclude merger-related expenses in both years.  Non-interest expense in 2016 grew $12.6 million or 6.9%, compared to 2015.  With net revenue growth of 7.5% in 2016, this positive operating leverage helped to improve the efficiency ratio in 2016 to 56.7% from 57.1% in 2015.  For 2016, salaries and wages increased $6.9 million or 9.0% due to increased compensation expense related to an 18.1% increase in full-time equivalent employees, primarily late in the third quarter of 2016 from the YCB acquisition, and routine annual adjustments to compensation. Employee benefits expense increased $1.1 million, or 3.9%, primarily from increased deferred compensation type expenses. Increases in net occupancy and equipment were also primarily from costs related to the additional branches from the YCB acquisition. At the end of the fourth quarter, a portion of the intended post conversion cost savings were beginning to be experienced through branch and system conversions.

Financial Results Conference Call

WesBanco will also host a conference call to discuss the Company's financial results for the fourth quarter of 2016 at 10:00 a.m. ET on Wednesday, January 25, 2017.  Interested parties can access the live webcast of the conference call through the Investor Relations section of the Company's website, www.wesbanco.com. Participants can also listen to the conference call by dialing 888-347-6607, 855-669-9657 for Canadian callers, or 412-902-4290 for international callers, and asking to be joined into the WesBanco call. Please log in or dial in at least 10 minutes prior to the start time to ensure a connection.

A replay of the conference call will be available by dialing 877-344-7529, 855-669-9658 for Canadian callers, or 412-317-0088 for international callers, and providing the access code of 10098820. The replay will begin at approximately 12:00 p.m. ET on January 25, and end at 12 a.m. ET on February 8. An archive of the webcast will be available for one year on the Investor Relations section of the Company's website (www.wesbanco.com).

Founded in 1870, WesBanco, Inc. (www.wesbanco.com) is a multi-state, bank holding company with total assets of approximately $9.8 billion (as of December 31, 2016). WesBanco is a diversified and well-balanced financial services institution, with a community bank at its core, built upon a strong legacy of credit and risk management. WesBanco has meaningful market share across its key geographies maintained by its commitment to dedicated customer service and solid fee-based businesses. It also provides wealth management services through a century-old trust and wealth management business, with more than $3 billion of assets under management, and serves as registered investment advisor to a proprietary mutual fund family, the WesMark Funds.  WesBanco's banking subsidiary, WesBanco Bank, Inc., operates 174 financial centers in the states of Indiana, Kentucky, Ohio, Pennsylvania, and West Virginia. In addition, WesBanco operates an insurance agency, WesBanco Insurance Services, Inc., and a full service broker/dealer, WesBanco Securities, Inc.

Forward-looking Statements:

Forward-looking statements in this report relating to WesBanco's plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The information contained in this report should be read in conjunction with WesBanco's Form 10-K for the year ended December 31, 2015 and documents subsequently filed by WesBanco with the Securities and Exchange Commission ("SEC"), including WesBanco's Form 10-Q for the quarters ended March 31, June 30, and September 30, 2016, which are available at the SEC's website, www.sec.gov or at WesBanco's website, www.wesbanco.com.  Investors are cautioned that forward-looking statements, which are not historical fact, involve risks and uncertainties, including those detailed in WesBanco's most recent Annual Report on Form 10-K filed with the SEC under "Risk Factors" in Part I, Item 1A. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including, without limitation, the effects of changing regional and national economic conditions; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to WesBanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, the Federal Deposit Insurance Corporation, the SEC, the Financial Institution Regulatory Authority, the Municipal Securities Rulemaking Board, the Securities Investors Protection Corporation, and other regulatory bodies; potential legislative and federal and state regulatory actions and reform, including, without limitation, the impact of the implementation of the Dodd-Frank Act; adverse decisions of federal and state courts; fraud, scams and schemes of third parties; internet hacking; competitive conditions in the financial services industry; rapidly changing technology affecting financial services; marketability of debt instruments and corresponding impact on fair value adjustments; and/or other external developments materially impacting WesBanco's operational and financial performance.  WesBanco does not assume any duty to update forward-looking statements.

 

WESBANCO, INC.












Consolidated Selected Financial Highlights











Page 5

(unaudited, dollars in thousands, except shares and per share amounts)































For the Three Months Ended


For the Year Ended

STATEMENT OF INCOME

December 31,


December 31,

Interest and dividend income

2016


2015


% Change


2016


2015


% Change


Loans, including fees

$             66,135


$           52,080


27.0


$       226,993


$         203,993


11.3


Interest and dividends on securities:














Taxable 

9,359


10,522


(11.1)


38,490


39,314


(2.1)



Tax-exempt

4,770


4,644


2.7


18,390


16,764


9.7




Total interest and dividends on securities

14,129


15,166


(6.8)


56,880


56,078


1.4


Other interest income 

555


414


34.1


2,224


1,641


35.5

          Total interest and dividend income

80,819


67,660


19.4


286,097


261,712


9.3

Interest expense













Interest bearing demand deposits

975


518


88.2


2,817


1,943


45.0


Money market deposits

510


484


5.4


1,860


1,914


(2.8)


Savings deposits

194


165


17.6


696


640


8.8


Certificates of deposit

2,585


2,630


(1.7)


10,419


11,033


(5.6)




Total interest expense on deposits

4,264


3,797


12.3


15,792


15,530


1.7


Federal Home Loan Bank borrowings

2,881


2,353


22.4


11,985


5,510


117.5


Other short-term borrowings

179


116


54.3


478


370


29.2


Subordinated debt and junior subordinated debt

1,807


774


133.5


4,512


3,315


36.1




Total interest expense

9,131


7,040


29.7


32,767


24,725


32.5

Net interest income 

71,688


60,620


18.3


253,330


236,987


6.9


Provision for credit losses

2,128


2,585


(17.7)


8,478


8,353


1.5

Net interest income after provision for credit losses

69,560


58,035


19.9


244,852


228,634


7.1

Non-interest income













Trust fees

5,470


5,244


4.3


21,630


21,900


(1.2)


Service charges on deposits

5,474


4,401


24.4


18,333


16,743


9.5


Electronic banking fees

4,268


3,691


15.6


15,596


14,361


8.6


Net securities brokerage revenue

1,330


1,795


(25.9)


6,449


7,692


(16.2)


Bank-owned life insurance

1,154


1,598


(27.8)


4,064


4,863


(16.4)


Net gains on sales of mortgage loans

484


612


(20.9)


2,529


2,071


22.1


Net securities gains

63


880


(92.8)


2,357


948


148.6


Net gain on other real estate owned and other assets

383


189


102.6


790


356


121.9


Other income

2,794


1,616


72.9


9,751


5,532


76.3




Total non-interest income

21,420


20,026


7.0


81,499


74,466


9.4

Non-interest expense













Salaries and wages

24,145


19,872


21.5


84,281


77,340


9.0


Employee benefits

7,267


6,745


7.7


27,952


26,896


3.9


Net occupancy

4,272


3,336


28.1


14,664


13,635


7.5


Equipment 

4,234


3,506


20.8


14,543


13,194


10.2


Marketing

1,515


1,425


6.3


5,391


5,646


(4.5)


FDIC insurance 

764


1,093


(30.1)


3,990


4,107


(2.8)


Amortization of intangible assets

1,334


811


64.5


3,598


3,136


14.7


Restructuring and merger-related expense

2,684


48


5,491.7


13,261


11,082


19.7


Other operating expenses  

12,083


10,058


20.1


41,000


38,887


5.4




Total non-interest expense

58,298


46,894


24.3


208,680


193,923


7.6

Income before provision for income taxes

32,682


31,167


4.9


117,671


109,177


7.8


Provision for income taxes 

8,464


8,165


3.7


31,036


28,415


9.2

Net Income

$             24,218


$           23,002


5.3


$         86,635


$           80,762


7.3
















Taxable equivalent net interest income

$            74,256


$          63,121


17.6


$      263,232


$       246,014


7.0
















Per common share data












Net income per common share - basic

$                 0.55


$               0.60


(8.3)


$              2.16


$               2.15


0.5

Net income per common share - diluted

0.55


0.60


(8.3)


2.16


2.15


0.5

Dividends declared

0.24


0.23


4.3


0.96


0.92


4.3

Book value (period end)







30.53


29.18


4.6

Tangible book value (period end) (1)







17.19


16.51


4.1

Average common shares outstanding - basic

43,887,781


38,507,772


14.0


40,100,320


37,488,331


7.0

Average common shares outstanding - diluted

43,935,815


38,538,771


14.0


40,127,076


37,547,127


6.9

Period end common shares outstanding

43,931,715


38,459,635


14.2


43,931,715


38,459,635


14.2
















(1) See non-GAAP financial measures for additional information relating to the calculation of this item.









 

WESBANCO, INC.

















Consolidated Selected Financial Highlights














Page 6

(unaudited, dollars in thousands)


































Selected ratios
























For the Year Ended









December 31,










2016


2015


% Change


























Return on average assets





0.97

%

0.99

%

(2.02)

%







Return on average equity





7.13


7.62


(6.43)








Return on average tangible equity (1)




12.73


13.41


(5.07)








Yield on earning assets (2) 





3.73


3.75


(0.53)








Cost of interest bearing liabilities




0.53


0.43


23.26








Net interest spread (2)





3.20


3.32


(3.61)








Net interest margin (2)





3.32


3.41


(2.64)








Efficiency (1) (2)






56.69


57.05


(0.63)








Average loans to average deposits




85.79


78.53


9.24








Annualized net loan charge-offs/average loans




0.12


0.23


(47.83)








Effective income tax rate 





26.38


26.03


1.34






















































































For the Quarter Ended










Dec. 31,


Sept. 30,


June 30,


Mar. 31,


Dec. 31,










2016


2016


2016


2016


2015






















Return on average assets





0.98

%

0.79

%

1.05

%

1.08

%

1.07

%



Return on average equity





7.12


5.71


7.69


8.07


8.11




Return on average tangible equity (1)




13.01


10.02


13.55


14.40


14.68




Yield on earning assets (2) 





3.84


3.73


3.71


3.70


3.69




Cost of interest bearing liabilities




0.55


0.53


0.53


0.52


0.47




Net interest spread (2)





3.29


3.20


3.18


3.18


3.22




Net interest margin (2)





3.42


3.32


3.30


3.29


3.32




Efficiency (1) (2) 






58.13


55.81


57.04


55.52


56.34




Average loans to average deposits




87.63


87.26


84.99


83.22


80.66




Annualized net loan charge-offs/average loans




0.08


0.20


0.08


0.12


0.20




Effective income tax rate 





25.90


24.94


26.78


27.54


26.20




Trust assets, market value at period end




$     3,723,142


$        3,694,405


$        3,660,736


$        3,623,532


$        3,625,411






















(1) See non-GAAP financial measures for additional information relating to the calculation of this item.









(2) The yield on earning assets, net interest margin, net interest spread and efficiency ratios are presented on a fully taxable-equivalent (FTE) and annualized basis. The FTE basis adjusts for the tax benefit of income on certain tax-exempt loans and investments. WesBanco believes this measure to be the preferred industry measurement of net interest income  and provides a relevant comparison between taxable and non-taxable amounts.





























 

WESBANCO, INC.









Consolidated Selected Financial Highlights








Page 7

(unaudited, dollars in thousands, except shares)








% Change

Balance sheets


December 31,



September  30, 

September 30, 2016

Assets



2016


2015


% Change

2016

to December 31, 2016

Cash and due from banks


$           106,257


$          75,707


40.4

$              106,430

(0.2)

Due from banks - interest bearing


21,913


10,978


99.6

9,702

125.9

Securities:











Trading securities, at fair value


7,071


6,451


9.6

7,070

0.0


Available-for-sale, at fair value


1,241,176


1,403,069


(11.5)

1,302,029

(4.7)


Held-to-maturity (fair values of $1,076,790; $1,038,207 and $1,089,227, respectively)


1,067,967


1,012,930


5.4

1,049,093

1.8



Total securities


2,316,214


2,422,450


(4.4)

2,358,192

(1.8)

Loans held for sale


17,315


7,899


119.2

20,231

(14.4)

Portfolio loans:










Commercial real estate


2,873,511


2,256,381


27.4

2,826,634

1.7


Commercial and industrial


1,088,118


737,878


47.5

1,097,788

(0.9)


Residential real estate 


1,383,390


1,247,800


10.9

1,395,886

(0.9)


Home equity


508,359


416,889


21.9

505,369

0.6


Consumer 


396,058


406,894


(2.7)

411,175

(3.7)

Total portfolio loans, net of unearned income


6,249,436


5,065,842


23.4

6,236,852

0.2

Allowance for loan losses


(43,674)


(41,710)


(4.7)

(42,755)

(2.1)



Net portfolio loans


6,205,762


5,024,132


23.5

6,194,097

0.2

Premises and equipment, net


133,297


112,203


18.8

138,731

(3.9)

Accrued interest receivable


28,299


25,759


9.9

29,964

(5.6)

Goodwill and other intangible assets, net


593,187


490,888


20.8

591,866

0.2

Bank-owned life insurance


188,145


150,980


24.6

186,993

0.6

Other assets


180,488


149,302


20.9

176,178

2.4

Total Assets


$      9,790,877


$   8,470,298


15.6

$         9,812,384

(0.2)













Liabilities









Deposits:











Non-interest bearing demand


$        1,789,522


$      1,311,455


36.5

$           1,697,476

5.4


Interest bearing demand


1,546,890


1,152,071


34.3

1,618,514

(4.4)


Money market


995,477


967,561


2.9

1,016,300

(2.0)


Savings deposits


1,213,168


1,077,374


12.6

1,228,509

(1.2)


Certificates of deposit


1,495,822


1,557,838


(4.0)

1,573,712

(4.9)



Total deposits


7,040,879


6,066,299


16.1

7,134,511

(1.3)

Federal Home Loan Bank borrowings


968,946


1,041,750


(7.0)

950,847

1.9

Other short-term borrowings


199,376


81,356


145.1

132,497

50.5

Subordinated debt and junior subordinated debt


163,598


106,196


54.1

163,364

0.1



Total borrowings


1,331,920


1,229,302


8.3

1,246,708

6.8

Accrued interest payable


2,204


1,715


28.5

2,898

(23.9)

Other liabilities


74,466


50,850


46.4

81,116

(8.2)

Total Liabilities


8,449,469


7,348,166


15.0

8,465,233

(0.2)













Shareholders' Equity









Preferred stock, no par value; 1,000,000 shares authorized; 










none outstanding


-


-


-

-

-

Common stock, $2.0833 par value; 100,000,000 shares authorized in










2016 and 2015, respectively; 43,931,715;  38,546,042 and 43,860,883 shares










issued, respectively; 43,931,715; 38,459,635 and 43,860,883 shares


91,524


80,304


14.0

91,377

0.2


outstanding, respectively









Capital surplus


680,507


516,294


31.8

678,007

0.4

Retained earnings


597,071


549,921


8.6

583,392

2.3

Treasury stock ( 0; 86,407 and 0 shares - at cost, respectively)


-


(2,640)


100.0

-

100.0

Accumulated other comprehensive loss


(27,126)


(20,954)


(29.5)

(5,062)

(435.9)

Deferred benefits for directors


(568)


(793)


28.4

(563)

(0.9)

Total Shareholders' Equity


1,341,408


1,122,132


19.5

1,347,151

(0.4)

Total Liabilities and Shareholders' Equity


$      9,790,877


$   8,470,298


15.6

$         9,812,384

(0.2)













 

WESBANCO, INC.



















Consolidated Selected Financial Highlights















Page 8


(unaudited, dollars in thousands)


















Average balance sheet and



















net interest margin analysis




For the Three Months Ended December 31,



For the Year Ended December 31,







2016

2015



2016

2015







Average 

Average



Average 

Average



Average 

Average



Average 

Average


Assets





Balance

Rate



Balance

Rate



Balance

Rate



Balance

Rate


Due from banks - interest bearing



$            16,365

0.66

%


$            11,647

0.21

%


$                 27,193

0.53

%


$           15,467

0.17

%

Loans, net of unearned income (1)



6,258,754

4.20



4,999,259

4.13



5,513,277

4.12



4,840,637

4.21


Securities: (2)




















    Taxable





1,612,145

2.32



1,861,808

2.26



1,677,128

2.29



1,757,288

2.24


    Tax-exempt (3)





713,545

4.11



645,737

4.43



667,066

4.24



568,671

4.54


        Total securities





2,325,690

2.87



2,507,545

2.82



2,344,194

2.85



2,325,959

2.80


Other earning assets





45,886

4.60



39,902

4.09



45,704

4.55



28,721

5.61


         Total earning assets (3)



8,646,695

3.84

%


7,558,353

3.69

%


7,930,368

3.73

%


7,210,784

3.75

%

Other assets





1,141,248




934,223




1,009,518




913,197



Total Assets





$     9,787,943




$     8,492,576




$          8,939,886




$    8,123,981























Liabilities and Shareholders' Equity


















Interest bearing demand deposits



$        1,579,115

0.25

%


$        1,192,502

0.17

%


$            1,340,001

0.21

%


$      1,143,965

0.17

%

Money market accounts 




1,018,287

0.20



997,850

0.19



961,847

0.19



1,003,980

0.19


Savings deposits





1,224,744

0.06



1,068,401

0.06



1,134,755

0.06



1,044,079

0.06


Certificates of deposit




1,538,837

0.67



1,624,024

0.64



1,514,767

0.69



1,704,871

0.65


    Total interest bearing deposits



5,360,983

0.32



4,882,777

0.31



4,951,370

0.32



4,896,895

0.32


Federal Home Loan Bank borrowings



929,939

1.23



881,471

1.06



995,644

1.20



591,506

0.93


Other borrowings





136,403

0.52



119,821

0.38



105,735

0.45



109,165

0.34


Subordinated debt and junior subordinated debt


163,478

4.40



106,196

2.89



124,318

3.63



115,088

2.88


      Total interest bearing liabilities 



6,590,803

0.55

%


5,990,265

0.47

%


6,177,067

0.53

%


5,712,654

0.43

%

Non-interest bearing demand deposits



1,780,870




1,315,363




1,474,883




1,267,158



Other liabilities





63,457




62,189




72,048




84,679



Shareholders' equity





1,352,813




1,124,759




1,215,888




1,059,490



Total Liabilities and Shareholders' Equity



$     9,787,943




$     8,492,576




$          8,939,886




$    8,123,981



Taxable equivalent net interest spread




3.29

%



3.22

%



3.20

%



3.32

%

Taxable equivalent net interest margin 




3.42

%



3.32

%



3.32

%



3.41

%





















(1) Gross of allowance for loan losses and net of unearned income.  Includes non-accrual and loans held for sale.

      Loan fees included in interest income on loans are $0.2 million and $0.8 million for the three months ended December 31, 2016 and 2015, respectively, and  $2.8 million and $1.5 million for the twelve months ended December 31, 2016 and 2015, respectively. Additionally, loan accretion included in interest income on loans acquired from prior acquisitions was $2.0 million and $0.9 million for the three months ended December 31, 2016 and 2015, respectively, and $4.4 million and $3.9 million for the twelve months ended December 31, 2016 and 2015, respectively, while accretion on  interest bearing liabilities acquired from the prior acquisitions was $0.6 million for both the three months ended December 31, 2016 and 2015, and $1.8 million and $3.4 million for the twelve months ended December 31, 2016 and 2015, respectively.




(2) Average yields on available-for-sale securities are calculated based on amortized cost.












(3) Taxable equivalent basis is calculated on tax-exempt securities using a rate of 35% for each period presented.










 

WESBANCO, INC.










Consolidated Selected Financial Highlights









 Page 9 

(unaudited, dollars in thousands, except shares and per share amounts)













Quarter Ended

Statement of Income

Dec. 31,


Sept.  30,


June 30,


Mar. 31,


Dec. 31,

Interest income

2016


2016


2016


2016


2015


Loans, including fees

$                        66,135


$                55,822


$              52,697


$                52,338


$              52,080


Interest and dividends on securities:












Taxable 

9,359


9,137


9,775


10,217


10,522



Tax-exempt

4,770


4,559


4,540


4,521


4,644




Total interest and dividends on securities

14,129


13,696


14,315


14,738


15,166


Other interest income 

555


574


573


525


414

          Total interest and dividend income

80,819


70,092


67,585


67,601


67,660

Interest expense











Interest bearing demand deposits

975


691


643


507


518


Money market deposits

510


444


450


456


484


Savings deposits

194


173


165


165


165


Certificates of deposit

2,585


2,592


2,583


2,659


2,630




Total interest expense on deposits

4,264


3,900


3,841


3,787


3,797


Federal Home Loan Bank borrowings

2,881


3,005


3,031


3,068


2,353


Other short-term borrowings

179


118


99


82


116


Subordinated debt and junior subordinated debt

1,807


1,043


840


822


774




Total interest expense

9,131


8,066


7,811


7,759


7,040

Net interest income 

71,688


62,026


59,774


59,842


60,620


Provision for credit losses

2,128


2,214


1,811


2,324


2,585

Net interest income after provision for credit losses

69,560


59,812


57,963


57,518


58,035

Non-interest income











Trust fees

5,470


5,413


5,036


5,711


5,244


Service charges on deposits

5,474


4,733


4,176


3,952


4,401


Electronic banking fees

4,268


3,945


3,742


3,604


3,691


Net securities brokerage revenue

1,330


1,473


1,750


1,896


1,795


Bank-owned life insurance

1,154


995


942


973


1,598


Net gains on sales of mortgage loans

484


814


683


548


612


Net securities gains

63


598


585


1,111


880


Net gain / (loss) on other real estate owned and other assets

383


184


214


(18)


189


Other income

2,794


2,862


2,463


1,616


1,616




Total non-interest income

21,420


21,017


19,591


19,393


20,026

Non-interest expense











Salaries and wages

24,145


21,225


19,731


19,180


19,872


Employee benefits

7,267


6,275


7,332


7,077


6,745


Net occupancy

4,272


3,647


3,220


3,591


3,336


Equipment 

4,234


3,557


3,402


3,428


3,506


Marketing

1,515


1,295


1,608


973


1,425


FDIC insurance 

764


961


1,099


1,166


1,093


Amortization of intangible assets

1,334


837


697


730


811


Restructuring and merger-related expense

2,684


9,883


694


-


48


Other operating expenses  

12,083


9,921


9,577


9,198


10,058




Total non-interest expense

58,298


57,601


47,360


45,343


46,894

Income before provision for income taxes

32,682


23,228


30,194


31,568


31,167


Provision for income taxes 

8,464


5,793


8,085


8,694


8,165

Net Income

$                        24,218


$                17,435


$              22,109


$                22,874


$              23,002














Taxable equivalent net interest income

$                       74,256


$               64,481


$             62,219


$               62,276


$             63,121














Per common share data










Net income per common share - basic

$                            0.55


$                    0.44


$                  0.58


$                    0.60


$                  0.60

Net income per common share - diluted

$                            0.55


$                    0.44


$                  0.58


$                    0.60


$                  0.60

Dividends declared

$                            0.24


$                    0.24


$                  0.24


$                    0.24


$                  0.23

Book value (period end)

$                          30.53


$                  30.71


$                30.31


$                  29.87


$                29.18

Tangible book value (period end) (1)

$                          17.19


$                  17.38


$                17.64


$                  17.17


$                16.51

Average common shares outstanding - basic

43,887,781


39,715,516


38,373,610


38,386,983


38,507,772

Average common shares outstanding - diluted

43,935,815


39,743,291


38,410,393


38,402,316


38,538,771

Period end common shares outstanding

43,931,715


43,860,883


38,411,343


38,362,534


38,459,635

Full time equivalent employees

1,928


1,936


1,650


1,624


1,633



























(1) See non-GAAP financial measures for additional information relating to the calculation of this item.






 

WESBANCO, INC.












Consolidated Selected Financial Highlights









 Page 10 


(unaudited, dollars in thousands)
















Quarter Ended






Dec. 31,


Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Asset quality data


2016


2016


2016


2016


2015


Non-performing assets:













Troubled debt restructurings - accruing


$           7,646


$           8,605


$           8,979


$           9,550


$         11,548



Non-accrual loans:














Troubled debt restructurings


3,546


3,759


4,121


4,517


4,617




Other non-accrual loans


28,238


26,897


28,334


29,343


28,764




    Total non-accrual loans


31,784


30,656


32,455


33,860


33,381




    Total non-performing loans 


39,430


39,261


41,434


43,410


44,929



Other real estate and repossessed assets


8,346


9,794


4,481


5,329


5,825




Total non-performing assets


$         47,776


$         49,055


$         45,915


$         48,739


$         50,754
















Past due loans (1):













Loans past due 30-89 days


$         16,029


$         17,569


$         10,392


$         11,888


$         11,005



Loans past due 90 days or more


3,739


2,392


2,263


4,186


3,126




Total past due loans


$         19,768


$         19,961


$         12,655


$         16,074


$         14,131
















Criticized and classified loans (2):













Criticized loans


$         24,778


$         35,468


$         26,543


$         31,410


$         26,298



Classified loans


49,965


52,909


52,789


53,182


53,408




Total criticized and classified loans


$         74,743


$         88,377


$         79,332


$         84,592


$         79,706
















Loans past due 30-89 days / total portfolio loans

0.26

%

0.28

%

0.20

%

0.23

%

0.22

%

Loans past due 90 days or more / total portfolio loans

0.06


0.04


0.04


0.08


0.06


Non-performing loans / total portfolio loans


0.63


0.63


0.80


0.85


0.89


Non-performing assets/total portfolio loans, other












real estate and repossessed assets


0.76


0.79


0.89


0.95


1.00


Non-performing assets / total assets


0.49


0.50


0.55


0.57


0.60


Criticized and classified loans / total portfolio loans

1.20


1.42


1.53


1.65


1.57
















Allowance for loan losses












Allowance for loan losses


$         43,674


$         42,755


$         43,328


$         42,525


$         41,710


Provision for credit losses


2,128


2,214


1,811


2,324


2,585


Net loan and deposit account overdraft charge-offs

1,213


2,798


1,013


1,532


2,516
















Annualized net loan charge-offs /average loans

0.08

%

0.20

%

0.08

%

0.12

%

0.20

%

Allowance for loan losses / total portfolio loans

0.70

%

0.69

%

0.84

%

0.83

%

0.82

%

Allowance for loan losses / non-performing loans

1.11

x

1.09

x

1.05

x

0.98

x

0.93

x

Allowance for loan losses / non-performing loans and












loans past due 


0.74

x

0.72

x

0.80

x

0.71

x

0.71

x

































Quarter Ended






Dec. 31,


Sept. 30,


June 30,


Mar. 31,


Dec. 31,






2016


2016


2016


2016


2015


Capital ratios












Tier I leverage capital


9.81

%

10.90

%

9.71

%

9.46

%

9.38

%

Tier I risk-based capital


13.16


12.95


13.62


13.30


13.35


Total risk-based capital


14.18


13.95


14.40


14.06


14.11


Common equity tier 1 capital ratio (CET 1)


11.28


11.07


11.88


11.58


11.66


Average shareholders' equity to average assets

13.82


13.91


13.60


13.32


13.24


Tangible equity to tangible assets (3)


8.20


8.26


8.56


8.15


7.95






























(1) Excludes non-performing loans.












(2) Criticized and classified loans may include loans that are also reported as non-performing or past due.






(3) See non-GAAP financial measures for additional information relating to the calculation of this ratio.






 

NON-GAAP FINANCIAL MEASURES












Page 11

The following non-GAAP financial measures used by WesBanco provide information useful to investors in understanding WesBanco's operating performance and trends, and facilitate comparisons with the performance of WesBanco's peers. The following tables summarize the non-GAAP financial measures derived from amounts reported in WesBanco's financial statements.





Three Months Ended


Year to Date 





Dec. 31,


Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Dec. 31,

(unaudited, dollars in thousands, except shares and per share amounts)

2016


2016


2016


2016


2015


2016

2015

Return on average tangible equity:














Net income (annualized)


$               96,344


$           69,361


$           88,922


$           91,999


$           91,258


$       86,635

$        80,762


Plus: amortization of intangibles (annualized) (1)

3,451


2,164


1,822


1,908


2,091


2,339

2,038


Net income before amortization of intangibles (annualized)

99,795


71,525


90,744


93,907


93,349


88,974

82,800


















Average total shareholders' equity

1,352,813


1,214,813


1,156,923


1,139,514


1,124,759


1,215,888

1,059,490


Less: average goodwill and other intangibles, net of def. tax liability

(585,529)


(500,752)


(487,085)


(487,210)


(488,677)


(516,840)

(442,215)


Average tangible equity


$             767,284


$         714,061


$         669,838


$         652,304


$         636,082


$     699,048

$      617,275

















Return on average tangible equity


13.01%


10.02%


13.55%


14.40%


14.68%


12.73%

13.41%

















Efficiency ratio:
















Non-interest expense


$               58,298


$           57,601


$           47,360


$           45,343


$           46,894


$     208,680

$      193,923


Less: restructuring and merger-related expense

(2,684)


(9,883)


(694)


-


(48)


(13,261)

(11,082)


Non-interest expense excluding restructuring and merger-related expense

55,614


47,718


46,666


45,343


46,846


195,419

182,841


















Net interest income on a fully taxable equivalent basis

74,256


64,481


62,219


62,276


63,121


263,232

246,014


Non-interest income


21,420


21,017


19,591


19,393


20,026


81,499

74,466


Net interest income on a fully taxable equivalent basis plus non-interest income

$               95,676


$           85,498


$           81,810


$           81,669


$           83,147


$     344,731

$      320,480


Efficiency Ratio


58.13%


55.81%


57.04%


55.52%


56.34%


56.69%

57.05%

















Net Income, excluding after-tax merger-related expenses:














Net income 



$               24,218


$           17,435


$           22,109


$           22,874


$           23,002


$       86,635

$        80,762


Add: After-tax merger-related expenses (1)

1,745


6,424


451


-


31


8,619

7,203

Net income, excluding after-tax merger-related expenses

$               25,963


$           23,859


$           22,560


$           22,874


$           23,033


$       95,254

$        87,965

















Net Income, excluding after-tax merger-related expenses per diluted share:














Net income per diluted share


$                   0.55


$               0.44


$               0.58


$               0.60


$               0.60


$           2.16

$            2.15


Add: After-tax merger-related expenses per diluted share (1)

0.04


0.16


0.01


-


-


0.21

0.19

Net income, excluding after-tax merger-related expenses per diluted share

$                   0.59


$               0.60


$               0.59


$               0.60


$               0.60


$           2.37

$            2.34





































Period End








Dec. 31,


Sept. 30,


June 30,


Mar. 31,


Dec. 31,








2016


2016


2016


2016


2015




Tangible book value:















Total shareholders' equity


$          1,341,408


$      1,347,151


$      1,164,420


$      1,145,910


$      1,122,132





Less:  goodwill and other intangible assets, net of def. tax liability

(586,403)


(584,690)


(486,913)


(487,267)


(487,270)





Tangible equity


755,005


762,461


677,507


658,643


634,862





















Common shares outstanding


43,931,715


43,860,883


38,411,343


38,362,534


38,459,635




















Tangible book value



$                 17.19


$             17.38


$             17.64


$             17.17


$             16.51




















Tangible equity to tangible assets:














Total shareholders' equity


$          1,341,408


$      1,347,151


$      1,674,420


$      1,145,910


$      1,122,132





Less:  goodwill and other intangible assets, net of def. tax liability

(586,403)


(584,690)


(486,913)


(497,267)


(487,270)





Tangible equity


755,005


762,461


677,507


658,643


634,862





















Total assets



9,790,877


9,812,384


8,397,424


8,569,381


8,470,298





Less:  goodwill and other intangible assets, net of def. tax liability

(586,403)


(584,690)


(486,913)


(487,267)


(487,270)





Tangible assets


$          9,204,474


$      9,227,694


$      7,910,511


$      8,082,114


$      7,983,028




















Tangible equity to tangible assets


8.20%


8.26%


8.56%


8.15%


7.95%




















































































(1) Tax effected at 35%.






























 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/wesbanco-announces-fourth-quarter-and-full-year-2016-net-income-300395979.html

SOURCE WesBanco, Inc.

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