Horizon Bancorp (HBNC, Financial) filed Annual Report for the period ended 2011-12-31.
Horizon Bncp-in has a market cap of $88.1 million; its shares were traded at around $17.75 with a P/E ratio of 7.9 and P/S ratio of 1. The dividend yield of Horizon Bncp-in stocks is 2.7%. Horizon Bncp-in had an annual average earning growth of 4.7% over the past 10 years. GuruFocus rated Horizon Bncp-in the business predictability rank of 2-star.
Consolidated net income was $12.8 million or $2.27 per diluted share in 2011, $10.5 million or $1.81 per diluted share in 2010, and $9.1 million or $1.58 per share in 2009. Diluted earnings per share were reduced by $0.26 for the twelve months ending December 31, 2011 and $0.43 for the twelve months ending December 31, 2010 and 2009 resulting from the preferred stock dividends and the accretion of the discount on the preferred stock.
Rates paid on interest-bearing liabilities decreased by 39 basis points during the same period due to the lower interest rate environment. Interest expense decreased $4.4 million from $20.9 million for 2010 to $16.5 million in 2011. This decrease was due to the lower rates being paid on the Companys interest bearing liabilities but offset by the increased volume of interest bearing liabilities. Due to a larger decrease in the yield on the Companys interest-earning assets compared to the decrease in the rates paid on the Companys interest-bearing liabilities, offset with the growth of the Companys interest earning assets and interest bearing liabilities, the net interest margin decreased 6 basis points from 3.80% for 2010 to 3.74% in 2011.
Rates paid on interest-bearing liabilities decreased by 64 basis points during the same period due to the lower interest rate environment. Interest expense decreased $7.0 million from $27.9 million for 2009 to $20.9 million in 2010. This decrease was due to the lower rates being paid on the Companys interest bearing liabilities but offset by the increased volume of interest bearing liabilities. Due to a more significant decrease in the rates paid on the Companys interest-bearing liabilities compared to the decrease in the yield on the Companys interest-earning assets, offset with the growth of the Companys interest earning assets and interest bearing liabilities, the net interest margin increased 14 basis points from 3.66% for 2009 to 3.80% in 2010.
The decrease in service charge income has been the result of reduced overdraft fee income as the number of consumer overdrafts has decreased. Wire transfer fee income decreased compared to the prior year as the Companys mortgage warehouse lending had less activity due to decreased residential mortgage loan refinancing volume compared to 2010. During 2011, the Company originated approximately $275.9 million of mortgage loans to be sold on the secondary market, compared to $281.7 million last year. More competitive pricing in the secondary market generated lower percentage gains on the sale of mortgage loans compared to 2010, lowering the overall gain on sale of mortgage loans compared to the prior year. Other income for 2011 included $206,000 from the loss on sale of OREO compared to a $393,000 gain on the sale of OREO in 2010. These decreases were offset by increases in interchange fees due to higher levels of activity in ATM and debit card transactions and mortgage servicing income greater than impairment charges during 2011. Also, the net gain on the sale of securities of $1.8 million was the result of reallocating select municipal securities to reduce concentration risks, an analysis that determined that market conditions provided the opportunity to add gains to capital without negatively impacting long term earnings and utilizing the gains to offset a $798,000 pre-payment penalty, included in other losses, for the repayment of an FHLB advance before its scheduled maturity. The company also recognized a $453,000 death benefit on officer life insurance during 2011.
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Horizon Bncp-in has a market cap of $88.1 million; its shares were traded at around $17.75 with a P/E ratio of 7.9 and P/S ratio of 1. The dividend yield of Horizon Bncp-in stocks is 2.7%. Horizon Bncp-in had an annual average earning growth of 4.7% over the past 10 years. GuruFocus rated Horizon Bncp-in the business predictability rank of 2-star.
Highlight of Business Operations:
The capital resources of Horizon and the Bank exceed regulatory capital ratios for well capitalized banks at December 31, 2011. Stockholders equity totaled $121.5 million as of December 31, 2011, compared to $112.3 million as of December 31, 2010. At year-end 2011, the ratio of stockholders equity to assets was 7.85%, compared to 8.01% for 2010. Tangible equity to tangible assets was 6.55% at December 31, 2011, compared to 6.13% at December 31, 2010. Book value per common share at December 31, 2011 increased to $22.02, compared to $19.12 at December 31, 2010. Horizons capital increased during 2011 as a result of earnings, an increase in other comprehensive income and the exercise of stock options, net of tax, and offset by dividends declared and the redemption of preferred stock.Consolidated net income was $12.8 million or $2.27 per diluted share in 2011, $10.5 million or $1.81 per diluted share in 2010, and $9.1 million or $1.58 per share in 2009. Diluted earnings per share were reduced by $0.26 for the twelve months ending December 31, 2011 and $0.43 for the twelve months ending December 31, 2010 and 2009 resulting from the preferred stock dividends and the accretion of the discount on the preferred stock.
Rates paid on interest-bearing liabilities decreased by 39 basis points during the same period due to the lower interest rate environment. Interest expense decreased $4.4 million from $20.9 million for 2010 to $16.5 million in 2011. This decrease was due to the lower rates being paid on the Companys interest bearing liabilities but offset by the increased volume of interest bearing liabilities. Due to a larger decrease in the yield on the Companys interest-earning assets compared to the decrease in the rates paid on the Companys interest-bearing liabilities, offset with the growth of the Companys interest earning assets and interest bearing liabilities, the net interest margin decreased 6 basis points from 3.80% for 2010 to 3.74% in 2011.
Rates paid on interest-bearing liabilities decreased by 64 basis points during the same period due to the lower interest rate environment. Interest expense decreased $7.0 million from $27.9 million for 2009 to $20.9 million in 2010. This decrease was due to the lower rates being paid on the Companys interest bearing liabilities but offset by the increased volume of interest bearing liabilities. Due to a more significant decrease in the rates paid on the Companys interest-bearing liabilities compared to the decrease in the yield on the Companys interest-earning assets, offset with the growth of the Companys interest earning assets and interest bearing liabilities, the net interest margin increased 14 basis points from 3.66% for 2009 to 3.80% in 2010.
The decrease in service charge income has been the result of reduced overdraft fee income as the number of consumer overdrafts has decreased. Wire transfer fee income decreased compared to the prior year as the Companys mortgage warehouse lending had less activity due to decreased residential mortgage loan refinancing volume compared to 2010. During 2011, the Company originated approximately $275.9 million of mortgage loans to be sold on the secondary market, compared to $281.7 million last year. More competitive pricing in the secondary market generated lower percentage gains on the sale of mortgage loans compared to 2010, lowering the overall gain on sale of mortgage loans compared to the prior year. Other income for 2011 included $206,000 from the loss on sale of OREO compared to a $393,000 gain on the sale of OREO in 2010. These decreases were offset by increases in interchange fees due to higher levels of activity in ATM and debit card transactions and mortgage servicing income greater than impairment charges during 2011. Also, the net gain on the sale of securities of $1.8 million was the result of reallocating select municipal securities to reduce concentration risks, an analysis that determined that market conditions provided the opportunity to add gains to capital without negatively impacting long term earnings and utilizing the gains to offset a $798,000 pre-payment penalty, included in other losses, for the repayment of an FHLB advance before its scheduled maturity. The company also recognized a $453,000 death benefit on officer life insurance during 2011.
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