updated 4/26/2011 5:16:56 PM ET 2011-04-26T21:16:56

CHAMPAIGN, Ill., April 26, 2011 (GLOBE NEWSWIRE) --

Message from our President & CEO

First Busey Corporation's (Nasdaq:BUSE) net income was $9.1 million and net income available to common stockholders was $7.3 million, or $0.09 per fully-diluted common share, for the first quarter of 2011. In comparison, the company reported net income for the first quarter of 2010 of $4.2 million and net income available to common stockholders of $2.9 million, or $0.04 per fully-diluted common share.

Our priorities remain balance sheet strength, profitability and growth – in that order. We expect to continue to see gradual improvement in non-performing loans and profitability while maintaining high capital ratios.

Asset Quality: Our non-performing loans at March 31, 2011 continued to show improvement. We expect continued gradual improvement in our overall asset quality in 2011; however, this is dependent on market specific economic conditions. The key metrics are as follows:

  • Non-performing loans decreased to $60.9 million at March 31, 2011 from $68.1 million at December 31, 2010 and $100.7 million at March 31, 2010.
  • Illinois non-performing loans decreased to $30.1 million at March 31, 2011 from $38.3 million at December 31, 2010 and $36.0 million at March 31, 2010.
  • Florida non-performing loans decreased slightly to $23.4 million at March 31, 2011 from $23.8 million at December 31, 2010 and $43.7 million at March 31, 2010.
  • Indiana non-performing loans increased to $7.4 million at March 31, 2011 from $6.0 million at December 31, 2010, but decreased compared to $21.0 million at March 31, 2010.
  • Loans 30-89 days past due decreased to $18.4 million at March 31, 2011 from $23.5 million at December 31, 2010, and $24.6 million at March 31, 2010. The primary reason for the increase in the fourth quarter of 2010 is related to single family residential mortgages, primarily in Illinois. Although we generally experience an increase in single family residential past dues in the fourth quarter, the increase in the fourth quarter of 2010 was higher than fourth quarter of 2009. We believe our loss exposure in single family residential mortgages is limited.
  • Other non-performing assets decreased to $7.2 million at March 31, 2011 from $9.2 million at December 31, 2010 and $18.5 million at March 31, 2010.
  • The ratio of non-performing assets to total loans plus other real estate owned at March 31, 2011 decreased to 3.04% from 3.25% at December 31, 2010 and 4.38% at March 31, 2010.
  • The allowance for loan losses to non-performing loans ratio increased to 122.89% at March 31, 2011 from 111.64% at December 31, 2010 and 94.23% at March 31, 2010.
  • The allowance for loan losses to total loans ratio increased to 3.35% at March 31, 2011 compared to 3.21% at December 31, 2010, but decreased from 3.51% at March 31, 2010.
  • Net charge-offs were $6.2 million for the first quarter of 2011, which were lower than the $17.4 million recorded in the fourth quarter of 2010, and the $20.0 million recorded for the first quarter of 2010.
  • Provision expense in the first quarter of 2011 was $5.0 million compared to $10.3 million in the fourth quarter of 2010 and $14.7 million in the first quarter of 2010.

Operating Performance: Our profit increased to $9.1 million in the first quarter of 2011 as compared to $7.3 million in the fourth quarter of 2010 and $4.2 million in the first quarter of 2010. The primary reason for the increase over the fourth quarter of 2010 was reduced provision expense of $5.3 million, offset by a decline in gains on sale of mortgage loans of $3.5 million.   

Significant operating performance items were: 

  • Net income available to common stockholders (net of TARP dividends) for the quarter ended March 31, 2011 was $7.3 million, or $0.09 per fully-diluted share, compared to net income of $2.9 million, or $0.04 per fully-diluted common share, for the quarter ended March 31, 2010.
  • Net interest margin decreased to 3.55% for the first quarter of 2011 as compared to 3.68% for the fourth quarter of 2010, but increased slightly from 3.52% for the first quarter of 2010. The increase in average earning assets from our December 2010 capital raise and loan pay downs were the primary reasons for the decline in net interest margin in the first quarter of 2011 as compared to fourth quarter of 2010. Overall, yields were fairly consistent on a linked quarter basis.
  • The efficiency ratio increased to 55.87% for the first quarter of 2011, as compared to 51.51% for the fourth quarter of 2010 and 53.69% for the first quarter of 2010.
  • Total revenue, net of interest expense and security gains, for the first quarter of 2011 was $43.9 million compared to $46.6 million for the fourth quarter of 2010 and $44.6 million for the first quarter of 2010.
  • FirsTech's net income increased to $0.5 million for the first quarter of 2011 compared to $0.3 million for the fourth quarter of 2010, but decreased slightly compared to $0.6 million for the first quarter of 2010.
  • Busey Wealth Management's net income of $0.7 million for the first quarter of 2011 was consistent with net income for the fourth quarter of 2010, but decreased slightly from $0.9 million for the first quarter of 2010.

Growth: In late January 2011, we began an initiative to spur organic growth and provided certain tools to our front line associates to foster this initiative. These tools facilitated the first quarter growth in non-time deposits of $30.5 million, or 1.6%, over December 31, 2010 levels, and we hope to see continued results going forward. 

The sales cycle on deposits is shorter than the sales cycle on loans. We have not yet experienced growth within our loan portfolio. Loans, net of allowance for loan losses, declined $105.2 million from December 31, 2010 due to soft loan demand and our reduction of non-relationship commercial real estate exposure. Additionally, loans held-for-sale declined $29.5 million in that period as interest rate increases on mortgages during the first quarter of 2011 slowed refinancing demand and our gains on sales of loans.

Capital: On March 4, 2011, we converted 318.6225 shares of Series B Convertible Preferred Stock into 7,497,000 shares of common stock. The Series B Preferred Stock had been issued as a part of our December 2010 registered direct offering, in which we raised a net $84.3 million in capital. Following the issuance of the common stock, we had 86,596,527 shares of common stock issued and outstanding. No shares of Series B Convertible Preferred Stock remained outstanding.  

Overall, we are pleased with our operating results for the first quarter of 2011. Each quarter of improved asset quality and profitability reinforces our belief that now is the time for growth. We continue to explore external growth opportunities while simultaneously focusing on internal growth. We will continue to base our efforts for internal growth on service, listening to our customers and fulfilling our promise to help them accomplish their goals.

On April 29, 2011, we will pay a cash dividend of $0.04 per common share to stockholders of record on April 22, 2011. 

We thank our associates for their efforts, our customers for their business and you, our stockholders, for your continued support of Busey.

\s\ Van A. Dukeman

President & Chief Executive Officer

First Busey Corporation

SELECTED FINANCIAL HIGHLIGHTS
(dollars in thousands, except per share data)
         
   Three Months Ended
  March 31, December 31, September 30, March 31,
  2011 2010 2010 2010
EARNINGS & PER SHARE DATA        
Net income $9,110 $7,306 $6,022 $4,217
Income available to common stockholders1 7,334 5,984 4,739 2,935
Revenue2 43,888 46,623 44,202 44,557
Fully-diluted income per share 0.09 0.09 0.07 0.04
Cash dividends paid per share 0.04 0.04 0.04 0.04
         
Net income by operating segment        
 Busey Bank $8,820 $7,008 $5,449 $3,470
 Busey Wealth Management 694 710 716 899
 FirsTech 450 299 425 641
         
AVERAGE BALANCES        
Assets $3,590,108 $3,548,171 $3,598,237 $3,724,025
Earning assets 3,294,097 3,227,207 3,280,987 3,402,221
Deposits 2,898,517 2,930,644 2,982,590 3,088,437
Interest-bearing liabilities 2,654,425 2,723,625 2,778,286 2,909,035
Stockholders' equity - common 289,475 237,485 234,916 230,703
Tangible stockholders' equity - common 249,563 196,616 193,008 187,776
         
PERFORMANCE RATIOS        
Return on average assets3 0.83% 0.67% 0.52% 0.32%
Return on average common equity3 10.27% 10.00% 8.00% 5.16%
Return on average tangible common equity3 11.92% 12.07% 9.74% 6.34%
Net interest margin3 3.55% 3.68% 3.64% 3.52%
Efficiency ratio4 55.87% 51.51% 58.21% 53.69%
Non-interest revenue as a % of total revenues2 35.41% 36.92% 32.96% 34.90%
         
ASSET QUALITY        
Gross loans $2,232,849 $2,368,777 $2,518,209 $2,706,793
Allowance for loan losses 74,849 76,038 83,098 94,929
Net charge-offs 6,189 17,361 18,531 19,950
Allowance for loan losses to loans 3.35% 3.21% 3.30% 3.51%
Allowance as a percentage of non-performing loans 122.89% 111.64% 104.29% 94.23%
Non-performing loans        
 Non-accrual loans 56,829 65,486 78,223 97,630
 Loans 90+ days past due 4,078 2,618 1,457 3,116
 Geographically        
 Downstate Illinois/ Indiana 37,527 44,281 56,831 57,020
 Florida 23,380 23,823 22,849 43,726
Loans 30 -89 days past due 18,419 23,477 19,322 24,630
Other non-performing assets 7,193 9,160 11,470 18,511
         
1 Available to common stockholders, net of preferred dividend and discount accretion
2 Net of interest expense, excludes security gains
3 Quarterly ratios annualized and calculated on net income available to common stockholders
4 Net of security gains and intangible charges
       
Condensed Consolidated Balance Sheets      
(Unaudited, in thousands, except per share data) March 31,  December 31,  March 31, 
  2011 2010 2010
Assets      
Cash and due from banks $412,152 $418,965 $218,867
Investment securities 664,930 599,459 530,215
Net loans, including loans held for sale 2,157,999 2,292,739 2,611,864
Premises and equipment 72,518 73,218 76,322
Goodwill and other intangibles 39,358 40,242 43,308
Other assets 171,008 180,380 221,904
Total assets $3,517,965 $3,605,003 $3,702,480
       
Liabilities & Stockholders' Equity      
Non-interest bearing deposits $484,480 $460,661 $443,207
Interest-bearing deposits 2,369,516 2,455,705 2,635,811
Total deposits $2,853,996 $2,916,366 $3,079,018
       
Securities sold under agreements to repurchase 120,734 138,982 133,297
Long-term debt 36,409 43,159 73,076
Junior subordinated debt owed to unconsolidated trusts 55,000 55,000 55,000
Other liabilities 27,895 30,991 33,373
Total liabilities $3,094,034 $3,184,498 $3,373,764
Total stockholders' equity $423,931 $420,505 $328,716
Total liabilities & stockholders' equity $3,517,965 $3,605,003 $3,702,480
       
Per Share Data      
Book value per common share $3.74 $3.65 $3.45
Tangible book value per common share $3.29 $3.14 $2.79
Ending number of common shares outstanding 86,597 79,100 66,361
   
Condensed Consolidated Statements of Operations  
(Unaudited, in thousands, except per share data) Three Months Ended March 31,
  2011 2010
     
Interest and fees on loans $30,508 $36,036
Interest on investment securities 4,398 4,657
Total interest income $34,906 $40,693
     
Interest on deposits 5,259 9,951
Interest on short-term borrowings 121 163
Interest on long-term debt 496 894
Junior subordinated debt owed to unconsolidated trusts 683 680
Total interest expense $6,559 $11,688
     
Net interest income $28,347 $29,005
Provision for loan losses 5,000 14,700
Net interest income after provision for loan losses $23,347 $14,305
     
Trust fees 4,548 4,210
Commissions and brokers' fees 441 440
Fees for customer services 4,329 3,943
Remittance processing 2,381 2,620
Gain on sales of loans 2,632 2,438
Net security gains (losses) (2) 742
Other 1,210 1,901
Total non-interest income $15,539 $16,294
     
Salaries and wages 9,560 9,666
Employee benefits 2,759 2,639
Net occupancy expense 2,415 2,342
Furniture and equipment expense 1,324 1,531
Data processing expense 2,110 1,896
Amortization expense 884 1,023
Regulatory expense 1,847 1,463
OREO expense 212 393
Other operating expenses 4,554 4,260
Total non-interest expense $25,665 $25,213
     
Income before income taxes $13,221 $5,386
Income taxes 4,111 1,169
Net income $9,110 $4,217
Preferred stock dividends and discount accretion $1,776 $1,282
Income available for common stockholders $7,334 $2,935
     
Per Share Data    
Basic earnings per common share $0.09 $0.04
Fully-diluted earnings per common share $0.09 $0.04
Diluted average common shares outstanding 81,356 66,361

Corporate Profile

First Busey Corporation is a $3.5 billion financial holding company headquartered in Champaign, Illinois. Busey Bank, First Busey Corporation's wholly-owned bank subsidiary, is headquartered in Champaign, Illinois and has thirty-three banking centers serving downstate Illinois, a banking center in Indianapolis, Indiana, and seven banking centers serving southwest Florida. Busey Bank had total assets of $3.5 billion as of March 31, 2011.

Busey Wealth Management is a wholly-owned subsidiary of First Busey Corporation. Through Busey Trust Company, Busey Wealth Management delivers trust, asset management, retail brokerage and insurance products and services. As of March 31, 2011, Busey Wealth Management had approximately $3.9 billion in assets under care.

First Busey Corporation owns a retail payment processing subsidiary, FirsTech, Inc., which processes over 28 million transactions per year through online bill payments, lockbox processing and walk-in payments through its 3,100 agent locations in 38 states.

Busey provides electronic delivery of financial services through our website, www.busey.com.

Special Note Concerning Forward-Looking Statements

This document may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company's management and on information currently available to management, are generally identifiable by the use of words such as "believe," "expect," "anticipate," "plan," "intend," "estimate," "may," "will," "would," "could," "should" or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events. A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local and national economy; (ii) the economic impact of any future terrorist threats or attacks; (iii) changes in state and federal laws, regulations and governmental policies concerning the Company's general business; (iv) changes in interest rates and prepayment rates of the Company's assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (vii) the loss of key executives or employees; (viii) changes in consumer spending; (ix) unexpected results of acquisitions; (x) unexpected outcomes of existing or new litigation involving the Company; and (xi) changes in accounting policies and practices. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company's financial results, is included in the Company's filings with the Securities and Exchange Commission.

CONTACT: David B. White, CFO
         217-365-4047

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