Old National Bancorp (ONB), the holding company for Old National Bank, on Monday reported a plunge in profit for the third quarter, reflecting higher provision for loan losses and non-interest expense. Both earnings and revenues came in short of analysts' consensus estimate.
For the third quarter, the Evansville, Indiana-based company's company's net income available to common shareholders dropped 76.9% to $4.02 million from $17.01 million in the year-ago quarter. Earnings per share plunged 76.9% to $0.06 from $0.26 in the previous year quarter.
On average, six analysts polled by Thomson Reuters expected the company to earn $0.11 per share for the quarter. Analysts' estimate typically excludes one-time charges and gains.
Quarterly revenue slid 2.7% to $100.69 million from $103.47 million in the same quarter last year. Analysts expected the company to report revenue of $103.47 million for the quarter.
Fees, service charges and other revenues edged up 1.3% to $39.64 million from $39.14 million a year earlier.
Net interest income on a fully taxable equivalent for the quarter shrank 4.3% to $61.68 million from $64.47 million in the year-earlier period. Net interest margin contracted to 3.53% from 3.79% in the corresponding period last year.
Provision for loan losses soared to $12.19 million, up 78.2% from $6.84 million in the year-earlier period. The company's total net charge-offs as a percent of average loans on an annualized basis for the quarter were 1.17%, compared to 0.46% last year.
Derivative losses for the quarter were $675 million, up from $186 million last year.
Including the Federal Deposit Insurance Corporation, or FDIC, special assessment charge non-interest expenses for the quarter increased 15.9% to $83.97 million from $72.46 million in the year-earlier period.
At September 30, 2009, commercial loans were $1.40 billion, compared to $1.80 million at September 30, 2008. Total core deposits were $5.62 billion, compared to $5.15 billion, while average assets were $8.00 billion, compared to $7.61 billion last year. At September 30, 2009, Old National Bancorp had Tier 1 capital ratio of 14.1% and a total risk-based capital ratio of 16.5%.
For the nine-month period, net income available to common shareholders slumped 65.7% to $19.16 million from $55.83 million in the same period last year. On a per share basis, earnings slipped 65.9% to $0.29 per share from $0.85 per share last year.
Net interest income for nine months dropped 0.8% to $193.07 million from $194.60 million in the same period last year. Provision for credit losses for the period climbed 20.4% to $41.46 million from $34.45 million in the year-ago period.
Old National Bancorp also declared a quarterly cash dividend of $0.07 per share payable on December 15 to stockholders of record as of the close of business on December 1.
ONB is currently trading at $10.25, down $0.04 or 0.39%, on a volume of 4.22 million shares on the NYSE.
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