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First Interstate BancSystem Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: November 4, 2010 07:38PM
First Interstate BancSystem Inc. (FIBK) filed Quarterly Report for the period ended 2010-09-30. First Interstate Bancsystem Inc. has a market cap of $197.5 million; its shares were traded at around $13 . The dividend yield of First Interstate Bancsystem Inc. stocks is 3.4%.FIBK is in the portfolios of HOTCHKIS & WILEY of HOTCHKIS & WILEY Capital Management LLC.
Highlight of Business Operations:
We are a financial and bank holding company headquartered in Billings, Montana. As of September 30, 2010, we had consolidated assets of $7,329 million, deposits of $5,902 million, loans of $4,452 million and total stockholders equity of $745 million. We currently operate 72 banking offices in 42 communities located in Montana, Wyoming and western South Dakota. Through our bank subsidiary, First Interstate Bank, or the Bank, we deliver a comprehensive range of banking products and services to individuals, businesses, municipalities and other entities throughout our market areas. Our customers participate in a wide variety of industries, including energy, healthcare and professional services, education and governmental services, construction, mining, agriculture, retail and wholesale trade and tourism.
Challenging economic conditions continue to have a negative impact on businesses and consumers in some of our market areas. General declines in the real estate and housing markets resulted in continued deterioration in the credit quality of our loan portfolio, which is reflected by increases in non-performing and internally risk classified loans. Our non-performing assets increased to $237 million, or 5.29% of total loans and OREO, as of September 30, 2010, from $163 million, or 3.57% of total loans and OREO, as of December 31, 2009. Loan charge-offs, net of recoveries, totaled $12.1 million and $32.2 million during the three and nine months ended September 30, 2010, respectively, compared to $7.1 million and $17.4 million during the same respective periods in 2009, with all major loan categories reflecting increases. Based on our assessment of the adequacy of our allowance for loan losses, we recorded provisions for loan losses of $18.0 million and $49.4 million during the three and nine months ended September, 30, 2010, respectively, compared to $10.5 million and $31.8 million during the same respective periods in 2009. Increased provisions for loan losses reflect our estimation of the effect of current economic conditions on our loan portfolio. During the first nine months of 2010, we have
On September 27, 2010, the Small Business Jobs Act of 2010, or the Jobs Act, was signed into legislation. The Jobs Act, among other things, creates a $30 billion fund, the Small Business Lending Fund, to provide capital for banks with assets under $10 billion to increase their small business lending. Management believes our current capital and liquidity is sufficient to fund loan demand in our market areas. As such, we do not anticipate we will participate in the Small Business Lending Fund program.
Net Interest Income. Deposit growth combined with corresponding increases in interest earning assets resulted in increases in net interest income, on a fully taxable equivalent, or FTE basis. Our FTE net interest income increased $2.3 million, or 3.7%, to $64.8 million for the three months ended September 30, 2010, as compared to $62.5 million for the same period in 2009, and increased $8.7 million, or 4.7%, to $192.0 million for the nine months ended September 30, 2010, as compared to $183.3 million for the same period in 2009.
Stocks Discussed: FIBK,