-----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, Agc5hKNHS48G1hqT2MoQewr4P72vll/dFS6bIFbrn8vRMaq48scPH1ubu/pTCplL ZJ601Rcuz1rTfy5X1G0TIg== 0000920112-02-000002.txt : 20020413 0000920112-02-000002.hdr.sgml : 20020413 ACCESSION NUMBER: 0000920112-02-000002 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20020122 ITEM INFORMATION: Other events FILED AS OF DATE: 20020122 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEARTLAND FINANCIAL USA INC CENTRAL INDEX KEY: 0000920112 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 421405748 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-15393 FILM NUMBER: 02514188 BUSINESS ADDRESS: STREET 1: 1398 CENTRAL AVE CITY: DUBUQUE STATE: IA ZIP: 52001 BUSINESS PHONE: 3195892000 MAIL ADDRESS: STREET 1: 1398 CENTRAL AVE CITY: DUBUQUE STATE: IA ZIP: 52001 8-K 1 l8k1201press.txt 8-K FOR RECENT EVENTS 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 January 22, 2002 (Date of earliest event reported) (January 22, 2002) HEARTLAND FINANCIAL, USA, INC. (Exact name of Registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation) 0-24724 42-1405748 (Commission File Number) (I.R.S. Employer Identification Number) 1398 Central Avenue, Dubuque, Iowa 52001 (Address of principal executive offices) (Zip Code) (563) 589-2100 (Registrant's telephone number, including area code) Item 5. Other Information On January 22, 2002, Heartland Financial USA, Inc. issued a press release announcing its earnings for the quarter ending December 31, 2001. The press release is attached hereto as Exhibit 99. At its regular board meeting held on January 15, 2002, Heartland Financial USA, Inc. appointed Thomas L. Flynn a director. Mr. Flynn, who is president of Flynn Ready-Mix Concrete and an Iowa state senator, is also a member of the board of directors of Dubuque Bank and Trust Company, Heartland's lead bank. Mr. Flynn's appointment fills a vacancy created last June by the death of long-time board member Evangeline K. Jansen. At Heartland's annual stockholders meeting in May, Mr. Flynn will stand for election to a full term. Additionally, at this same board meeting, Gregory R. Miller resigned as a director of Heartland. Mr. Miller had served on the board since 1987, and his term was due to expire in 2004. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED. None. (b) PRO FORMA FINANCIAL INFORMATION. None. (c) EXHIBITS. 99 Press Release dated January 22, 2002. 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. HEARTLAND FINANCIAL USA, INC. Dated: January 22, 2002 By:/s/ John K. Schmidt --------------------------- John K. Schmidt Executive Vice President and Chief Financial Officer EX-99 3 lex991201press.txt 12/31/01 EARNINGS PRESS RELEASE Exhibit 99 PRESS RELEASE January 22, 2002 FROM: Heartland Financial USA, Inc. Lynn B. Fuller - Chairman, President and CEO (563) 589-2105 John K. Schmidt - Executive Vice President and CFO (563) 589-1994 RE: Fourth Quarter 2001 Earnings RELEASE: Immediate HEARTLAND FINANCIAL USA, INC. REPORTS AN INCREASE IN FOURTH QUARTER EARNINGS (Dubuque, Iowa) Heartland Financial USA, Inc. today announced increased earnings for the fourth quarter of 2001. Net income totaled $3.482 million, or $.36 on a diluted earnings per common share basis, for the fourth quarter of 2001 compared to $2.756 million, or $.28 on a diluted earnings per common share basis, during the same quarter in 2000. Return on common equity was 13.20%, and return on assets was .85% for the fourth quarter of 2001. For the same period in 2000, return on equity was 11.78% and return on assets was .77%. Contributing to the increased earnings during the fourth quarter of 2001 was the $2.316 million or 20% increase in net interest income, due in large part to growth in earning assets. Average earning assets grew from $1.277 billion during the fourth quarter of 2000 to $1.455 billion during the same quarter in 2001, an increase of $178 million or 14%. Other income experienced a $968 thousand or 13% increase. Exclusive of securities gains and losses, including trading account securities gains and impairment losses on equity securities, other income experienced a $1.246 million or 17% increase. The additional $1.043 million gains on sale of loans was the primary contributor to this increase in other income. Growth in other expenses was $1.543 million or 11%. For the twelve months ended December 31, 2001, earnings increased $1.828 million or 19% when compared to 2000. Diluted earnings per common share grew to $1.18 from the $.98 recorded during 2000. Return on common equity was 11.32% and return on assets was .72% for 2001, compared to 10.69% and .70%, respectively, for 2000. A $5.328 million or 12% improvement in net interest income for the twelve-month period ended December 31, 2001, was the largest contributor to the double-digit growth in earnings. Also reflecting significant improvement during 2001 were the other income categories of gains on sale of loans and service charges and fees, with increases of $2.217 million and $995 thousand, respectively. As interest rates moved downward throughout the year, customers frequently elected to refinance into fifteen- and thirty-year, fixed-rate mortgage loans, which Heartland usually elects to sell into the secondary market while retaining servicing. Chairman, President and Chief Executive Officer Lynn B. Fuller noted, "Many throughout our nation will agree that the year 2001 proved to be a challenging one as the economy weakened and the effects of the September 11 tragedy lingered. In spite of all the turmoil occurring, we are extremely pleased that Heartland was able to record double-digit growth in both earnings and assets for the second consecutive year. The 2001 results reinforce and encourage our community banking approach. Our management team remains enthused about the future and focused on expanding the customer base in all the markets we serve." Total assets reached nearly $1.644 billion at December 31, 2001, an increase of 12% since December 31, 2000. Loans and leases grew to $1.105 billion and deposits exceeded $1.210 billion at the end of the year, increases of 6% and 10%, respectively, since December 31, 2000. Net interest margin, expressed as a percentage of average earning assets improved to 3.79% during the fourth quarter of 2001 compared to 3.67% during the previous quarter and 3.61% for the fourth quarter of 2000. On a year-to-date basis, the net interest margin decreased from 3.74% during 2000 to 3.65% during 2001. During 2000, national prime increased from 8.50% at the beginning of the year to 9.50% at the end of the year. Conversely, during 2001, national prime decreased from 9.50% to 4.75%. Heartland's negative gap position suggested a larger improvement in the net interest margin during such a period of downward movement in interest rates, but management elected to remain competitive in the market areas it serves and not reprice its deposit products as quickly. In addition to the delay in repricing of deposit products, also negatively impacting the net interest margin has been the change in the composition of the balance sheet, as the percentage of average loans to total average assets decreased from 72% in 2000 to 67% in 2001. Loan growth slowed due to paydowns experienced in the mortgage loan portfolio and reduced demand in the commercial loan portfolio. Management feels that opportunities for growth within the commercial loan portfolio will expand during 2002. The allowance for loan and lease losses at December 31, 2001, was 1.33% of loans and 180% of nonperforming loans, compared to 1.30% of loans and 202% of nonperforming loans at year-end 2000. Nonperforming loans increased to .73% of total loans and leases at December 31, 2001, compared to .65% of total loans and leases at December 31, 2000. A weakening economy will inevitably result in increased problem loans, but Heartland expects the problems to be manageable and of a lesser scope for Heartland than for the industry as a whole. Provision for loan and lease losses increased $982 thousand or 30% during 2001 when compared to 2000, primarily as a result of growth experienced in the loan portfolio and the increase in nonperforming loans. Heartland is a $1.6 billion financial services company with six banks in Iowa, Illinois, Wisconsin and New Mexico: Dubuque Bank and Trust Company, with eight offices in Dubuque, Epworth, Farley and Holy Cross, Iowa Galena State Bank and Trust Company, with three offices in Galena and Stockton, Illinois First Community Bank, FSB, with three offices in Keokuk, Iowa and Carthage, Illinois Riverside Community Bank, with three offices in Rockford, Illinois Wisconsin Community Bank, with six offices in Cottage Grove, Middleton, Sheboygan, De Pere, Monroe and Eau Claire, Wisconsin New Mexico Bank and Trust, with nine offices in Albuquerque and Clovis, New Mexico Other subsidiaries include: ULTEA, Inc., a fleet leasing company with offices in Madison and Milwaukee, Wisconsin Citizens Finance Co., a consumer finance company with offices in Madison and Appleton, Wisconsin; Dubuque, Iowa; and Rockford, Illinois Additional information about Heartland is available through our website at www.htlf.com. This release may contain forward-looking statements. Forward- looking statements are identifiable by the inclusion of such qualifications as expects, intends, believes, may, likely or other indications that the particular statements are not based upon facts but are rather based upon the company's beliefs as of the date of this release. Actual events and results may differ significantly from those described in such forward-looking statements, due to changes in the economy, interest rates or other factors. For additional information about the factors, please review our filings with the Securities and Exchange Commission. HEARTLAND FINANCIAL USA, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA For the Quarter Ended December 31, 2001 2000 ---------------------------- INCOME STATEMENT DATA Interest income (tax equivalent adjusted) $ 26,762 $ 28,082 Interest expense 12,871 16,507 ---------- ---------- Net interest income 13,891 11,575 Provision for loan and lease losses 1,242 696 Other income 8,179 7,211 Other expense 15,280 13,737 Income tax expense 1,811 1,316 Tax equivalent adjustment 255 281 ---------- ---------- Net income $ 3,482 $ 2,756 ========== ========== PER COMMON SHARE DATA Earnings per common share - basic $ 0.36 $ 0.29 Earnings per common share - diluted 0.36 0.28 Cash earnings per common share - basic* 0.40 0.32 Cash earnings per common share - diluted* 0.39 0.32 Dividends declared per common share 0.10 0.09 AVERAGE BALANCES Assets $1,627,582 $1,433,038 Loans and leases, net of unearned 1,081,313 1,039,375 Deposits 1,203,931 1,063,737 Earning assets 1,454,730 1,276,571 Stockholders' equity 104,679 93,084 EARNINGS PERFORMANCE RATIOS Return on average assets 0.85% 0.77% Return on average equity 13.20 11.78 Net interest margin 3.79 3.61 Net interest margin, excluding fleet leasing company debt 3.90 3.78 Efficiency ratio 69.28 73.38 Efficiency ratio, banks only 60.29 62.45 *Cash earnings exclude goodwill and core deposit intangible amortization. HEARTLAND FINANCIAL USA, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA For the Twelve Months Ended December 31, 2001 2000 ---------------------------- INCOME STATEMENT DATA Interest income (tax equivalent adjusted) $ 111,179 $ 105,367 Interest expense 60,193 59,709 ---------- ---------- Net interest income 50,986 45,658 Provision for loan and lease losses 4,283 3,301 Other income 30,334 27,008 Other expense 58,818 54,446 Income tax expense 5,714 4,216 Tax equivalent adjustment 1,091 1,117 ---------- ---------- Net income $ 11,414 $ 9,586 ========== ========== PER COMMON SHARE DATA Earnings per common share - basic $ 1.19 $ 1.00 Earnings per common share - diluted 1.18 0.98 Cash earnings per common share - basic* 1.33 1.14 Cash earnings per common share - diluted* 1.31 1.13 Dividends declared per common share 0.37 0.36 AVERAGE BALANCES Assets $1,588,332 $1,370,398 Loans and leases, net of unearned 1,069,072 989,731 Deposits 1,152,757 1,008,582 Earning assets 1,395,189 1,220,053 Stockholders' equity 100,836 89,673 EARNINGS PERFORMANCE RATIOS Return on average assets 0.72% 0.70% Return on average equity 11.32 10.69 Net interest margin 3.65 3.74 Net interest margin, excluding fleet leasing company debt 3.78 3.91 Efficiency ratio 73.68 75.45 Efficiency ratio, banks only 64.21 64.82 *Cash earnings exclude goodwill and core deposit intangible amortization. HEARTLAND FINANCIAL USA, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA December 31, December 31, 2001 2000 ------------ ------------ BALANCE SHEET DATA Total assets $1,644,064 $1,466,387 Securities 325,217 228,065 Total loans and leases 1,105,205 1,042,096 Allowance for loan & leas losses 14,660 13,592 Total deposits 1,210,159 1,101,313 Long-term debt 143,789 102,856 Total stockholders' equity 107,090 96,146 PER COMMON SHARE DATA Book value per common share $ 11.06 $ 10.00 FAS 115 effect on book value per common share .37 0.14 ASSET QUALITY Nonaccrual loans $ 7,269 $ 5,860 Restructured loans 354 357 Loans past due ninety days or more as to interest or principal payments 500 523 Other real estate owned 130 489 Other repossessed assets 343 219 ---------- ---------- Total nonperforming assets $ 8,596 $ 7,448 ========== ========== Ratio of nonperforming loans to total loans and leases 0.73% 0.65% Ratio of nonperforming assets to total assets 0.52 0.51 Changes in allowance for loans & lease losses: Balance, beginning of period $ 13,592 $ 10,844 Provision charged to operating expense 4,283 3,301 Loans charged off (3,757) (2,280) Recoveries 542 585 Additions related to acquisitions 0 1,142 ---------- ---------- Balance, end of period $ 14,660 $ 13,592 ========== ========== Ratio of net loan chargeoffs to average loans & leases 0.30% 0.17% Allowance for loan losses as a percent of loans 1.33 1.30 HEARTLAND FINANCIAL USA, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA For the For the Quarter Ended Twelve Months Ended December 31, December 31, 2001 2000 2001 2000 ------------------ ------------------- OTHER INCOME Service charges and fees $ 1,664 $ 1,482 $ 6,381 $ 5,386 Trust fees 837 820 3,148 3,088 Brokerage commissions 141 195 615 846 Insurance commissions 217 279 807 862 Securities gains, net 13 66 1,489 501 Gain (loss) on trading account securities 93 - (417) - Rental income on operating leases 3,955 3,828 15,446 14,918 Gains on sale of loans 1,238 195 2,738 521 Impairment loss on equity securities (318) - (773) (244) Other noninterest income 339 346 900 1,130 -------- -------- -------- -------- Total other income $ 8,179 $ 7,211 $ 30,334 $ 27,008 ======== ======== ======== ======== OTHER EXPENSE Salaries and employee benefits $ 6,541 $ 5,927 $ 25,460 $ 23,876 Occupancy 711 683 3,076 2,904 Furniture and equipment 844 802 3,193 3,015 Depreciation on equipment under operating leases 3,066 2,884 11,805 11,199 Outside services 945 678 3,470 2,661 FDIC deposit insurance assessment 53 47 208 228 Advertising 416 324 1,596 1,492 Goodwill and core deposit intangibles amortization 418 454 1,672 1,814 Other operating expenses 2,286 1,938 8,338 7,257 -------- -------- -------- -------- Total other expense $ 15,280 $ 13,737 $ 58,818 $ 54,446 ======== ======== ======== ======== -----END PRIVACY-ENHANCED MESSAGE-----