-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VCb/6v4JYvaRQaKruKk1+89Bu7ju9QGmM39zdyeLRloKYtRDgxO1LJqnlQz/E1dM EYTrqFT25jE9DJ2On9mzHg== 0000702902-05-000115.txt : 20050718 0000702902-05-000115.hdr.sgml : 20050718 20050718115415 ACCESSION NUMBER: 0000702902-05-000115 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050630 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050718 DATE AS OF CHANGE: 20050718 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HARLEYSVILLE NATIONAL CORP CENTRAL INDEX KEY: 0000702902 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 232210237 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-15237 FILM NUMBER: 05958773 BUSINESS ADDRESS: STREET 1: 483 MAIN ST STREET 2: P O BOX 195 CITY: HARLEYSVILLE STATE: PA ZIP: 19438 BUSINESS PHONE: 2152568851 MAIL ADDRESS: STREET 1: 483 MAIN STREET CITY: HARLEYSVILLE STATE: PA ZIP: 19438 8-K 1 form8k2005secondquarter.htm HNC FORM 8K SECOND QUARTER EARNINGS RELEASE HNC Form 8K Second Quarter Earnings Release



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report -July 18, 2005

HARLEYSVILLE NATIONAL CORPORATION
(Exact name of registrant as specified in its charter)

___________________

 
Pennsylvania
0-15237
23-2210237
(State or other jurisdiction
of incorporation or organization)
Commission File Number
(IRS Employer
Identification No.)

483 Main Street
Harleysville, Pennsylvania 19438
(Address of principal executive office and zip code)

(215) 256-8851
(Registrant’s telephone number, including area code)





Check the appropriate box below if the Form 8K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.133-4(c))

-1-




Item 2.02 Results of Operations and Financial Condition

   
Harleysville National Corporation announced the unaudited, consolidated financial results for Harleysville National Corporation and subsidiaries for the six-month period ending June 30, 2005. On July 18, 2005, Harleysville National Corporation issued a press release titled “Second Quarter Earnings up 3.3% at Harleysville National Corporation,” a copy of which is filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

(a)  
Not applicable.
(b)  
Not applicable.
(c)  
Exhibits.

Exhibit 99.1: Press Release issued by Harleysville National Corporation dated July 18, 2005 titled “Second Quarter Earnings Up 3.3% at Harleysville National Corporation.”



-2-


SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



HARLEYSVILLE NATIONAL CORPORATION




Dated: July 18, 2005                  /s/ George S. Rapp                 
George S. Rapp, SVP and Chief Financial Officer


-3-

EXHIBIT INDEX

 
Page
   
Exhibit 99.1 Press Release dated July 18, 2005, of Harleysville National Corporation (filed pursuant to Item 2.02 hereof).
5
 
  
   
   
   



-4-
 EX-99.1 PRESSRELEASE 2 pr2qtr2005.htm EARNINGS RELEASE - 2ND QUARTER 2005 Earnings Release - 2nd quarter 2005
FOR IMMEDIATE RELEASE
CONTACT:  Gregg J. Wagner, President and CEO
PHONE: 215-513-2391

SECOND QUARTER EARNINGS UP 3.3%
AT HARLEYSVILLE NATIONAL CORPORATION


HARLEYSVILLE, PA (July 18, 2005) - Harleysville National Corporation (HNC) (NASDAQ: HNBC), today announced second quarter 2005 earnings of $9.7 million, a 3.3% increase over second quarter 2004 earnings of $9.4 million. Earnings for the six-month period ending June 30, 2005, were $18.9 million, a 3.1% increase over earnings of $18.3 million for the six-month period ending June 30, 2004.
The corporation’s consolidated total assets were $3.03 billion at June 30, 2005, an increase of 5.8% or $166.6 million above the June 30, 2004, level of $2.87 billion. Of this increase, 7.2% or $207.2 million was due to loan growth partially offset by a net decrease in cash and investments of 1.3% or $38.7 million.
For the quarter ending June 30, 2005, diluted earnings per share of $.36 increased 2.9% over the $.35 earned during the second quarter of 2004 and basic earnings per share of $.37 remained level with the earnings during the same period last year. For the six-month period ended June 30, 2005, diluted earnings per share were $.70 compared to $.69 for the same period in 2004, and basic earnings per share of $.72 remained level with earnings during the first six months of 2004. The financial results for 2005 include the impact of operations from the acquisition of Millennium Bank effective April 30, 2004.
Gregg J. Wagner, President and Chief Executive Officer, said, “Our strong second quarter performance reflects an increase over the same quarter last year as well as compared to the first quarter of this year. We are particularly pleased with both the continued growth in our loan portfolio and the improved results in our Millennium Wealth Management and Private Banking product and service revenue.”
 

-5-

Net interest income on a fully tax-equivalent basis in the second quarter of 2005 increased $217,000 or .9% over the same period in 2004 and $1.4 million or 3.1% during the six-month period ending June 30, 2004. This increase was primarily due to higher loan volume partially offset by higher deposit rates and an elevated level of borrowings. The net interest margin for the second quarter of 2005 was 3.34%, compared to 3.37% for the first quarter of 2005 and 3.62% for the second quarter of 2004. The decline in the net interest margin from 2004 is primarily due to higher funding costs, particularly in money market deposit accounts and short-term borrowings. Average earning assets increased $230.7 million or 8.9% during the second quarter of 2005 versus the comparable period in 2004. Average loans increased $306.2 million or 19.5% during the same period partially offset by a decrease in investment securities of $83.0 million or 8.4%.
Nonperforming assets, including nonaccrual loans, net assets in foreclosure and loans 90 days or more past due was .15% of total assets at June 30, 2005, an improvement compared to .20% at December 31, 2004, and .16% at June 30, 2004. The decrease in nonperforming assets at June 30, 2005, in relation to December 31, 2004 was mainly due to a lower level of commercial real estate loans past due 90 days or more and nonaccrual loans as a result of payments made. The ratio of the allowance for loan losses to nonperforming loans (nonaccruing loans and loans 90 days or more past due) was 448.7% at June 30, 2005, compared to 324.6% at December 31, 2004 and 430.8% at June 30, 2004. The increase in the provision for the three and six-month periods ending June 30, 2005, compared to the same periods in 2004 was primarily due to inherent risk related to loan growth.
Core deposits increased 11.8% or $166.5 million, to $1.58 billion at June 30, 2005, from $1.41 billion at June 30, 2004. Total deposits increased $130.2 million for the same period, which was primarily due to the growth in core deposits.
    Total noninterest income of $7.8 million for the second quarter of 2005 reflects an increase of $1.5 million or 23.3% from the comparable period in 2004 and $2.6 million or 21.7% for the six-month period ended June 30, 2005, from $12.1 million for the same period in 2004. The second quarter increase is primarily due to an increase of $463,000 in trust and investment advisory fees and gains on sales of $690,000 for Harleysville National Bank’s McAdoo branch and $287,000 for Cumberland Advisors, Inc. The increase over the first six months of 2004 was
 
-6-

attributed to the aforementioned gains on sale as well as a cumulative increase in trust and investment advisory fees of $1.3 million and an additional $245,000 in income from credit life reinsurance activities.
Noninterest expense of $16.9 million for the second quarter of 2005 increased $2.3 million or 15.8% from $14.6 million in the second quarter of 2004 and $4.0 million or 14.0% for the first six months of 2005 in comparison to the same period in 2004. Salaries and benefits expense increased $1.3 million during the second quarter of 2005 from the comparable period in 2004 and $2.6 million for the six months ended June 30, 2005 over the same period in 2004. These increases are primarily related to the acquisition of Millennium Bank and higher pension and healthcare costs. Occupancy expense increased $430,000 for the first six months ended June 30, 2005 over the same period in 2004 mostly due to the Millennium acquisition and a new branch opening. Other expense increased $996,000 for the second quarter of 2005 and $1.1 million for the six-month period mainly due to increased expenses for professional fees (Sarbanes-Oxley related) and advertising as well as deferred compensation expense for directors and employees. Partially offsetting the variances for the six-month period was higher loan origination expense deferrals related to increased loan origination volume.
Harleysville National Corporation, with assets of $3 billion, is the holding company for Harleysville National Bank (HNB). Investment Management and Trust Services are provided through Millennium Wealth Management & Private Banking, a division of HNB. Recently listed on the “Super 50 Team,”“Earnings All-Stars,”“Dividend All-Stars,” and “America’s Smartest Companies®,” lists in the Staton Institute, Inc’s, America’s Finest Companies, Harleysville National Corporation stock is traded under the symbol "HNBC" and is commonly quoted under Nasdaq National Market Issues. For more information, visit the HNC website at www.hncbank.com.
 
 
This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. Such factors include the possibility that increased demand or prices for the Corporation’s financial services and products may not occur, changing economic and competitive conditions, technological developments, and other risks and uncertainties, including those detailed in the Corporation’s filings with the Securities and Exchange Commission.
 
-7-
 

Harleysville National Corporation
    
   
   
   
   
 
Consolidated Selected Financial Data(1)
    
   
   
   
   
 
(Dollars in thousands, except per share data)
    
   
   
   
   
 
June 30, 2005
    
   
   
   
   
 
(unaudited)
                                
                                 
For the period:
        
Three Months Ended
            
 
    
Jun. 30, 
 
 
Mar. 31,
 
 
Dec. 31,
 
 
Sept. 30,
 
 
June 30,
 
 
 
 
2005
 
 
2005
 
 
2004
 
 
2004
 
 
2004
  
Interest Income
  
$
36,889
  
$
35,272
  
$
34,196
  
$
33,366
  
$
30,994
  
Interest Expense
    
15,042
   
13,602
   
12,735
   
11,286
   
9,674
 
Net Interest Income
    
21,847
   
21,670
   
21,461
   
22,080
   
21,320
 
Provision for Loan Losses
    
650
   
750
   
1,070
   
499
   
497
 
Net Interest Income after
                                
Provision for Loan Losses
    
21,197
   
20,920
   
20,391
   
21,581
   
20,823
 
                                 
Service Charges
    
2,044
   
1,957
   
1,953
   
2,000
   
1,929
 
Gains on Sales of Investment Securities, Net
    
226
   
923
   
2,036
   
112
   
641
 
Gain on Sale of Branch
    
690
   
-
   
-
   
-
   
-
 
Trust, Investment Services and Advisory Income
    
2,051
   
1,929
   
1,999
   
1,878
   
1,588
 
Bank-Owned Life Insurance Income
    
645
   
493
   
627
   
647
   
521
 
Income on Life Insurance
    
177
   
-
   
586
   
-
   
-
 
Other Income
    
1,919
   
1,641
   
2,194
   
2,056
   
1,608
 
Total Noninterest Income
    
7,752
   
6,943
   
9,395
   
6,693
   
6,287
 
                                 
Salaries, Wages and Employee Benefits
    
10,180
   
9,500
   
10,215
   
9,754
   
8,834
 
Occupancy
    
1,243
   
1,391
   
1,218
   
1,135
   
1,120
 
Furniture and Equipment
    
1,151
   
1,170
   
1,256
   
1,217
   
1,316
 
Other Expenses
    
4,319
   
3,442
   
3,985
   
2,371
   
3,323
 
Total Noninterest Expense
    
16,893
   
15,503
   
16,674
   
14,477
   
14,593
 
                                 
Income Before Income Taxes
    
12,056
   
12,360
   
13,112
   
13,797
   
12,517
 
Income Tax Expense
    
2,366
   
3,195
   
2,999
   
3,632
   
3,135
 
Net Income
  
$
9,690
  
$
9,165
  
$
10,113
  
$
10,165
  
$
9,382
  
                                 
Per Common Share Data:
                               
Weighted Average Common Shares - Basic
    
26,240,307
   
26,247,137
   
26,182,888
   
26,240,616
   
25,861,549
 
Weighted Average Common Shares - Diluted
    
26,775,115
   
26,967,759
   
27,057,756
   
27,055,603
   
26,722,932
 
Net Income Per Share - Basic
  
$
0.37
  
$
0.35
  
$
0.38
  
$
0.39
  
$
0.37
  
Net Income Per Share - Diluted
  
$
0.36
  
$
0.34
  
$
0.37
  
$
0.38
  
$
0.35
  
Cash Dividend Per Share
 
$
0.18
  
$
0.18
  
$
0.22
  
$
0.18
  
$
0.16
  
Book Value
  
$
10.50
  
$
10.24
  
$
10.30
  
$
10.19
  
$
9.58
  
Market Value
  
$
23.16
  
$
21.25
  
$
26.60
  
$
24.51
  
$
24.38
  
                                 
                                 
For the period:
    
Six Months Ended
                
   
June 30, 
                
 
    
2005
 
 
2004
                    
Interest Income
  
$
72,161
  
$
60,167
                    
Interest Expense
    
28,644
   
18,617
                   
Net Interest Income
    
43,517
   
41,550
                   
Provision for Loan Losses
    
1,400
   
986
                   
Net Interest Income after
                                
Provision for Loan Losses
    
42,117
   
40,564
                   
                                 
Service Charges
    
4,001
   
3,854
                   
Gains on Sales of Investment Securities, Net
    
1,149
   
1,541
                   
Gain on Sale of Branch
    
690
   
-
                   
Trust, Investment Services and Advisory Income
    
3,980
   
2,709
                   
Bank-Owned Life Insurance Income
    
1,138
   
1,132
                   
Income on Life Insurance
    
177
   
-
                   
Other Income
    
3,560
   
2,834
                   
Total Noninterest Income
    
14,695
   
12,070
                   
                                 
Salaries, Wages and Employee Benefits
    
19,680
   
17,111
                   
Occupancy
    
2,634
   
2,204
                   
Furniture and Equipment
    
2,321
   
2,390
                   
Other Expenses
    
7,761
   
6,705
                   
Total Noninterest Expense
    
32,396
   
28,410
                   
                                 
Income Before Income Taxes
    
24,416
   
24,224
                   
Income Tax Expense
    
5,561
   
5,935
                   
Net Income
  
$
18,855
  
$
18,289
                    
                                 
 
 
-8-
 
                                 
Per Common Share Data:
                               
Weighted Average Common Shares - Basic
    
26,243,704
   
25,494,791
                   
Weighted Average Common Shares - Diluted
    
26,822,850
   
26,425,884
                   
Net Income Per Share - Basic
  
$
0.72
  
$
0.72
                    
Net Income Per Share - Diluted
  
$
0.70
  
$
0.69
                    
Cash Dividend Per Share
 
$
0.36
  
$
0.32
                    
                                 
                                 
                                 
     
2005
 
 
2005
 
 
2004
 
 
2004
 
 
2004
  
Asset Quality Data:
    
2Q
 
 
1Q
 
 
4Q
 
 
3Q
 
 
2Q
 
Nonaccrual Loans
  
$
3,531
  
$
4,572
  
$
4,705
  
$
3,350
  
$
3,245
  
90 + Days Past Due Loans
    
679
   
599
   
981
   
948
   
919
 
Nonperforming Loans
    
4,210
   
5,171
   
5,686
   
4,298
   
4,164
 
Net Assets in Foreclosure
    
459
   
411
   
370
   
347
   
389
 
Nonperforming Assets
  
$
4,669
  
$
5,582
  
$
6,056
  
$
4,645
  
$
4,553
  
Loan Loss Reserve
  
$
18,890
  
$
18,724
  
$
18,455
  
$
17,795
  
$
17,940
  
Loan Loss Reserve / Loans
    
1.00
%
  
1.00
%
  
1.00
%
  
1.00
%
  
1.07
%
Loan Loss Reserve / Nonperforming Loans
    
448.7
%
  
362.1
%
  
324.6
%
  
414.0
%
  
430.8
%
Nonperforming Assets / Total Assets
    
0.15
%
  
0.19
%
  
0.20
%
  
0.16
%
  
0.16
%
Net Loan Charge-offs
  
$
484
  
$
481
  
$
410
  
$
644
  
$
698
  
Net Loan Charge-offs (annualized)
                               
/ Average Loans
    
0.10
%
  
0.11
%
  
0.09
%
  
0.15
%
  
0.18
%
                                 
                                 
     
2005
 
 
2005
 
 
2004
 
 
2004
 
 
2004
  
Selected Ratios (annualized):
    
2Q
 
 
1Q
 
 
4Q
 
 
3Q
 
 
2Q
  
Return on Average Assets
    
1.29
%
  
1.25
%
  
1.36
%
  
1.40
%
  
1.37
%
Return on Average Shareholders' Equity
    
14.30
%
  
13.69
%
  
15.00
%
  
15.61
%
  
15.06
%
Yield on Earning Assets (FTE)
    
5.48
%
  
5.34
%
  
5.16
%
  
5.18
%
  
5.12
%
Cost of Interest Bearing Funds
    
2.57
%
  
2.37
%
  
2.19
%
  
2.01
%
  
1.82
%
Net Interest Margin (FTE)
    
3.34
%
  
3.37
%
  
3.34
%
  
3.51
%
  
3.62
%
Leverage Ratio
    
9.06
%
  
8.99
%
  
8.91
%
  
8.99
%
  
9.28
%
                                 
                                 
                                 
     
2005
 
 
2004
 
                  
Selected Ratios (annualized):
    
Year-to-date
 
 
Year-to-date
                   
Return on Average Assets
    
1.27
%
  
1.40
%
                  
Return on Average Shareholders' Equity
    
14.00
%
  
15.23
%
                  
Yield on Earning Assets (FTE)
    
5.41
%
  
5.19
%
                  
Cost of Interest Bearing Funds
    
2.47
%
  
1.84
%
                  
Net Interest Margin (FTE)
    
3.36
%
  
3.68
%
                  
                                 
                                 
 
 
-9-
 
                                 
                                 
Balance Sheet (Period End):
    
2005
 
 
2005
 
 
2004
 
 
2004
 
 
2004
  
   
2Q 
 
 
1Q
 
 
4Q
 
 
3Q
 
 
2Q
  
Assets
  
$
3,032,588
  
$
3,002,572
  
$
3,024,515
  
$
2,976,173
  
$
2,865,949
  
Earning Assets
    
2,837,263
   
2,817,956
   
2,845,656
   
2,791,891
   
2,678,772
 
Investment Securities
    
893,587
   
907,379
   
943,563
   
975,750
   
957,398
 
Loans, Net of Unearned Fees
    
1,891,692
   
1,865,641
   
1,845,802
   
1,774,189
   
1,683,528
 
Other Earning Assets
    
51,984
   
44,936
   
56,291
   
41,952
   
37,846
 
Interest-Bearing Liabilities
    
2,349,820
   
2,343,177
   
2,367,229
   
2,332,102
   
2,218,687
 
Total Deposits
    
2,223,304
   
2,237,567
   
2,212,563
   
2,209,753
   
2,093,101
 
Noninterest-Bearing Deposits
    
360,695
   
332,525
   
333,516
   
325,132
   
345,191
 
Interest-Bearing Checking
    
331,201
   
352,132
   
305,584
   
320,276
   
258,739
 
Money Market
    
676,260
   
679,872
   
713,039
   
661,480
   
561,823
 
Savings
    
209,865
   
222,553
   
223,039
   
229,992
   
245,768
 
Time, under $100,000
    
508,313
   
523,782
   
508,010
   
527,971
   
523,587
 
Time, $100,000 or greater
    
136,970
   
126,703
   
129,375
   
144,902
   
157,993
 
Total Borrowed Funds
    
487,211
   
438,135
   
488,182
   
447,481
   
470,777
 
Federal Home Loan Bank
    
272,750
   
272,750
   
317,750
   
257,750
   
241,750
 
Other Borrowings
    
214,461
   
165,385
   
170,432
   
189,731
   
229,027
 
Shareholders' Equity
    
275,484
   
268,724
   
270,532
   
266,966
   
251,877
 
                                 
                                 
                                 
Balance Sheet (Average):
    
2005
 
 
2005
 
 
2004
 
 
2004
 
 
2004
  
   
2Q 
 
 
1Q
 
 
4Q
 
 
3Q
 
 
2Q
  
Assets
  
$
3,006,076
  
$
2,976,361
  
$
2,957,559
  
$
2,878,769
  
$
2,759,563
  
Earning Assets
    
2,823,832
   
2,801,817
   
2,776,599
   
2,695,579
   
2,593,105
 
Investment Securities
    
900,457
   
910,981
   
941,704
   
932,330
   
983,420
 
Loans, Net of Unearned Fees
    
1,879,028
   
1,845,408
   
1,793,935
   
1,717,245
   
1,572,830
 
Other Earning Assets
    
44,347
   
45,428
   
40,960
   
46,004
   
36,855
 
Interest-Bearing Liabilities
    
2,344,504
   
2,328,569
   
2,308,446
   
2,237,681
   
2,136,010
 
Total Deposits
    
2,226,609
   
2,196,584
   
2,213,829
   
2,154,443
   
2,048,279
 
Noninterest-Bearing Deposits
    
339,234
   
321,912
   
324,466
   
329,559
   
316,715
 
Interest-Bearing Checking
    
342,133
   
325,081
   
317,328
   
285,735
   
274,978
 
Money Market
    
675,052
   
688,602
   
692,703
   
620,420
   
537,614
 
Savings
    
216,287
   
222,853
   
226,251
   
237,463
   
239,971
 
Time, under $100,000
    
508,723
   
513,986
   
517,167
   
525,701
   
508,275
 
Time, $100,000 or greater
    
145,180
   
124,150
   
135,914
   
155,565
   
170,726
 
Total Borrowed Funds
    
457,129
   
453,897
   
419,083
   
412,797
   
404,446
 
Federal Home Loan Bank
    
272,750
   
292,917
   
263,566
   
255,837
   
187,608
 
Other Borrowings
    
184,379
   
160,980
   
155,517
   
156,960
   
216,838
 
Shareholders' Equity
    
271,735
   
271,531
   
268,211
   
259,035
   
250,504
 
                                 
(1) Certain prior period amounts have been reclassified to conform to current period presentation.
                                
 
 
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