Park National Corporation reports financial results for second quarter and first half of 2024
22 Juli 2024 - 10:15PM
Park National Corporation (Park) (NYSE American: PRK) today
reported financial results for the second quarter and first half of
2024. Park's board of directors declared a quarterly cash dividend
of $1.06 per common share, payable on September 10, 2024, to common
shareholders of record as of August 16, 2024.
“Our performance stems from our commitment to provide consistent
financial support, to remain resilient in uncertain times, and to
never stop searching for new ways to serve customers,” said Park
Chairman and Chief Executive Officer David Trautman. “We’re eager
to introduce new tools that will make our banking services more
accessible than ever and allow more people to experience a
wonderful blend of digital elegance and human empathy in banking
with Park.”
Park’s net income for the second quarter of 2024 was $39.4
million, a 24.6 percent increase from $31.6 million for the second
quarter of 2023. Second quarter 2024 net income per diluted common
share was $2.42, compared to $1.94 for the second quarter of 2023.
Park's net income for the first half of 2024 was $74.6 million, a
14.2 percent increase from $65.3 million for the first half of
2023. Net income per diluted common share for the first half of
2024 was $4.60 compared to $4.01 for the first half of 2023.
Park’s total loans increased 2.5 percent (5.1 percent
annualized) during the first half of 2024 and increased 6.3% for
the 12-month period ended June 30, 2024. Park's total loans
increased 1.9 percent (7.4 percent annualized) during the three
months ended June 30, 2024.
Park's total deposits increased 3.4 percent (6.7 percent
annualized) during the first half of 2024 and decreased 0.6 percent
for the 12-month period ended June 30, 2024. The combination of
strong loan growth and steady deposits resulted in a net interest
margin of 4.39 percent for the three months ended June 30, 2024,
compared to 4.28 percent for the three months ended March 31, 2024,
and 4.07 percent for the three months ended June 30, 2023. For the
first half of 2024 the net interest margin was 4.33 percent
compared to 4.07 percent for the first half of 2023.
“We continue to experience growth in net interest income,
supported by year-to-date annualized commercial loan growth of 6.4
percent that reflects our consistent approach to lending regardless
of economic fluctuations and the interest rate environment,” said
Park President Matthew Miller. “We’re also pleased to report growth
in net income and earnings per share, demonstrating our bankers’
commitment to controlling expenses and leveraging technology as we
prepare to cross $10 billion in assets.”
Headquartered in Newark, Ohio, Park National Corporation has
$9.9 billion in total assets (as of June 30, 2024). Park's banking
operations are conducted through its subsidiary The Park National
Bank. Other Park subsidiaries are Scope Leasing, Inc. (d.b.a. Scope
Aircraft Finance), Guardian Financial Services Company (d.b.a.
Guardian Finance Company) and SE Property Holdings, LLC.
Complete financial tables are listed below.
Category: Earnings
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
Park cautions that any forward-looking statements contained in
this news release or made by management of Park are provided to
assist in the understanding of anticipated future financial
performance. Forward-looking statements provide current
expectations or forecasts of future events and are not guarantees
of future performance. The forward-looking statements are based on
management’s expectations and are subject to a number of risks and
uncertainties, including those described in Park's Annual Report on
Form 10-K for the fiscal year ended December 31, 2023, as updated
by our filings with the SEC. Although management believes that the
expectations reflected in such forward-looking statements are
reasonable, actual results may differ materially from those
expressed or implied in such statements.
Risks and uncertainties that could cause actual results to
differ materially include, without limitation: (1) Park's ability
to execute our business plan successfully and within the expected
timeframe; (2) adverse changes in future economic and financial
market conditions; (3) adverse changes in real estate values and
liquidity in our primary market areas; (4) the financial health of
our commercial borrowers; (5) adverse changes in federal, state and
local governmental law and policy, including the regulatory
landscape, capital markets, elevated government debt, potential
changes in tax legislation, government shutdown, infrastructure
spending and social programs; (6) changes in consumer spending,
borrowing and saving habits; (7) our litigation and regulatory
compliance exposure; (8) increased credit risk and higher credit
losses resulting from loan concentrations; (9) competitive
pressures among financial services organizations; (10) changes in
accounting policies and practices as may be adopted by regulatory
agencies; (11) Park's assumptions and estimates used in applying
critical accounting policies and modeling which may prove
unreliable, inaccurate or not predictive of actual results; (12)
Park's ability to anticipate and respond to technological changes
and Park's reliance on, and the potential failure of, a number of
third-party vendors to perform as expected; (13) failures in or
breaches of Park's operational or security systems or
infrastructure, or those of our third-party vendors and other
service providers; (14) negative impacts on financial markets and
the economy of any changes in the credit ratings of the U.S.
Treasury obligations and other U.S. government-backed debt, as well
as issues surrounding the levels of U.S., European and Asian
government debt and concerns regarding the growth rates and
financial stability of certain sovereign governments,
supranationals and financial institutions in Europe and Asia; (15)
effects of a fall in stock market prices on Park's asset and wealth
management businesses; (16) continued availability of earnings and
excess capital sufficient for the lawful and prudent declaration of
dividends; (17) the impact on Park's business, personnel,
facilities or systems of losses related to acts of fraud, scams and
schemes of third parties; (18) the impact of widespread natural and
other disasters, pandemics, dislocations, regional or national
protests and civil unrest (including any resulting branch closures
or damages), military or terrorist activities or international
hostilities on the economy and financial markets generally and on
us or our counterparties specifically; (19) the potential further
deterioration of the U.S. economy due to financial, political, or
other shocks; (20) the effect of healthcare laws in the U.S. and
potential changes for such laws that may increase our healthcare
and other costs and negatively impact our operations and financial
results; (21) the impact of larger or similar-sized financial
institutions encountering problems that may adversely affect the
banking industry; (22) and other risk factors relating to the
financial services industry.
Park does not undertake, and specifically disclaims any
obligation, to publicly release the results of any revisions that
may be made to update any forward-looking statement to reflect the
events or circumstances after the date on which the forward-looking
statement was made, or reflect the occurrence of unanticipated
events, except to the extent required by law.
|
PARK
NATIONAL CORPORATION |
Financial
Highlights |
As of or
for the three months ended June 30, 2024, March 31, 2024 and June
30, 2023 |
|
|
|
|
|
|
|
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
Percent change vs. |
(in thousands, except common share and per common share
data and ratios) |
2nd QTR |
1st QTR |
2nd QTR |
|
1Q '24 |
2Q '23 |
INCOME STATEMENT: |
|
|
|
|
|
|
Net interest income |
$ |
97,837 |
|
$ |
95,623 |
|
$ |
91,572 |
|
|
2.3 |
% |
6.8 |
% |
Provision for credit
losses |
|
3,113 |
|
|
2,180 |
|
|
2,492 |
|
|
42.8 |
% |
24.9 |
% |
Other income |
|
28,794 |
|
|
26,200 |
|
|
25,015 |
|
|
9.9 |
% |
15.1 |
% |
Other
expense |
|
75,189 |
|
|
77,228 |
|
|
75,885 |
|
|
(2.6)% |
(0.9)% |
Income before income taxes |
$ |
48,329 |
|
$ |
42,415 |
|
$ |
38,210 |
|
|
13.9 |
% |
26.5 |
% |
Income
taxes |
|
8,960 |
|
|
7,211 |
|
|
6,626 |
|
|
24.3 |
% |
35.2 |
% |
Net income |
$ |
39,369 |
|
$ |
35,204 |
|
$ |
31,584 |
|
|
11.8 |
% |
24.6 |
% |
|
|
|
|
|
|
|
MARKET
DATA: |
|
|
|
|
|
|
Earnings per common share -
basic (a) |
$ |
2.44 |
|
$ |
2.18 |
|
$ |
1.95 |
|
|
11.9 |
% |
25.1 |
% |
Earnings per common share -
diluted (a) |
|
2.42 |
|
|
2.17 |
|
|
1.94 |
|
|
11.5 |
% |
24.7 |
% |
Quarterly cash dividend
declared per common share |
|
1.06 |
|
|
1.06 |
|
|
1.05 |
|
|
— |
% |
1.0 |
% |
Book value per common share at
period end |
|
73.27 |
|
|
71.95 |
|
|
67.40 |
|
|
1.8 |
% |
8.7 |
% |
Market price per common share
at period end |
|
142.34 |
|
|
135.85 |
|
|
102.32 |
|
|
4.8 |
% |
39.1 |
% |
Market capitalization at
period end |
|
2,298,723 |
|
|
2,199,556 |
|
|
1,652,818 |
|
|
4.5 |
% |
39.1 |
% |
|
|
|
|
|
|
|
Weighted average common shares
- basic (b) |
|
16,149,523 |
|
|
16,116,842 |
|
|
16,165,119 |
|
|
0.2 |
% |
(0.1)% |
Weighted average common shares
- diluted (b) |
|
16,239,617 |
|
|
16,191,065 |
|
|
16,240,600 |
|
|
0.3 |
% |
— |
% |
Common shares outstanding at
period end |
|
16,149,523 |
|
|
16,149,523 |
|
|
16,153,425 |
|
|
— |
% |
— |
% |
|
|
|
|
|
|
|
PERFORMANCE RATIOS:
(annualized) |
|
|
|
|
|
|
Return on average assets
(a)(b) |
|
1.61 |
% |
|
1.44 |
% |
|
1.28 |
% |
|
11.8 |
% |
25.8 |
% |
Return on average
shareholders' equity (a)(b) |
|
13.52 |
% |
|
12.23 |
% |
|
11.61 |
% |
|
10.5 |
% |
16.5 |
% |
Yield on loans |
|
6.13 |
% |
|
5.99 |
% |
|
5.43 |
% |
|
2.3 |
% |
12.9 |
% |
Yield on investment
securities |
|
3.83 |
% |
|
3.90 |
% |
|
3.73 |
% |
|
(1.8)% |
2.7 |
% |
Yield on money market
instruments |
|
5.33 |
% |
|
5.48 |
% |
|
5.11 |
% |
|
(2.7)% |
4.3 |
% |
Yield on interest earning
assets |
|
5.78 |
% |
|
5.66 |
% |
|
5.08 |
% |
|
2.1 |
% |
13.8 |
% |
Cost of interest bearing
deposits |
|
1.99 |
% |
|
1.94 |
% |
|
1.46 |
% |
|
2.6 |
% |
36.3 |
% |
Cost of borrowings |
|
4.08 |
% |
|
4.25 |
% |
|
3.54 |
% |
|
(4.0)% |
15.3 |
% |
Cost of paying interest
bearing liabilities |
|
2.10 |
% |
|
2.08 |
% |
|
1.58 |
% |
|
1.0 |
% |
32.9 |
% |
Net interest margin (g) |
|
4.39 |
% |
|
4.28 |
% |
|
4.07 |
% |
|
2.6 |
% |
7.9 |
% |
Efficiency ratio (g) |
|
59.09 |
% |
|
63.07 |
% |
|
64.58 |
% |
|
(6.3)% |
(8.5)% |
|
|
|
|
|
|
|
OTHER DATA (NON-GAAP)
AND BALANCE SHEET INFORMATION: |
|
|
|
|
|
|
Tangible book value per common
share (d) |
$ |
63.14 |
|
$ |
61.80 |
|
$ |
57.19 |
|
|
2.2 |
% |
10.4 |
% |
Average interest earning
assets |
|
9,016,905 |
|
|
9,048,204 |
|
|
9,122,323 |
|
|
(0.3)% |
(1.2)% |
Pre-tax, pre-provision net
income (j) |
|
51,442 |
|
|
44,595 |
|
|
40,702 |
|
|
15.4 |
% |
26.4 |
% |
|
|
|
|
|
|
|
Note:
Explanations for footnotes (a) - (k) are included at the end of the
financial tables in the "Financial Reconciliations" section. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PARK
NATIONAL CORPORATION |
Financial Highlights (continued) |
As of or
for the three months ended June 30, 2024, March 31, 2024 and June
30, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
Percent change vs. |
(in thousands, except ratios) |
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
1Q '24 |
2Q '23 |
BALANCE SHEET: |
|
|
|
|
|
|
Investment securities |
$ |
1,264,858 |
|
$ |
1,339,747 |
|
$ |
1,756,953 |
|
|
(5.6)% |
(28.0)% |
Loans |
|
7,664,377 |
|
|
7,525,005 |
|
|
7,208,109 |
|
|
1.9 |
% |
6.3 |
% |
Allowance for credit
losses |
|
86,575 |
|
|
85,084 |
|
|
87,206 |
|
|
1.8 |
% |
(0.7)% |
Goodwill and other intangible
assets |
|
163,607 |
|
|
163,927 |
|
|
164,915 |
|
|
(0.2)% |
(0.8)% |
Other real estate owned
(OREO) |
|
1,210 |
|
|
1,674 |
|
|
2,267 |
|
|
(27.7)% |
(46.6)% |
Total assets |
|
9,919,783 |
|
|
9,881,077 |
|
|
9,899,551 |
|
|
0.4 |
% |
0.2 |
% |
Total deposits |
|
8,312,505 |
|
|
8,306,032 |
|
|
8,358,976 |
|
|
0.1 |
% |
(0.6)% |
Borrowings |
|
283,874 |
|
|
295,130 |
|
|
332,818 |
|
|
(3.8)% |
(14.7)% |
Total shareholders'
equity |
|
1,183,257 |
|
|
1,161,979 |
|
|
1,088,757 |
|
|
1.8 |
% |
8.7 |
% |
Tangible equity (d) |
|
1,019,650 |
|
|
998,052 |
|
|
923,842 |
|
|
2.2 |
% |
10.4 |
% |
Total nonperforming loans |
|
72,745 |
|
|
71,759 |
|
|
58,229 |
|
|
1.4 |
% |
24.9 |
% |
Total nonperforming
assets |
|
73,955 |
|
|
73,433 |
|
|
60,496 |
|
|
0.7 |
% |
22.2 |
% |
|
|
|
|
|
|
|
ASSET QUALITY
RATIOS: |
|
|
|
|
|
|
Loans as a % of period end
total assets |
|
77.26 |
% |
|
76.16 |
% |
|
72.81 |
% |
|
1.4 |
% |
6.1 |
% |
Total nonperforming loans as a
% of period end loans |
|
0.95 |
% |
|
0.95 |
% |
|
0.81 |
% |
|
— |
% |
17.3 |
% |
Total nonperforming assets as
a % of period end loans + OREO + other nonperforming
assets |
|
0.96 |
% |
|
0.98 |
% |
|
0.84 |
% |
|
(2.0)% |
14.3 |
% |
Allowance for credit losses as
a % of period end loans |
|
1.13 |
% |
|
1.13 |
% |
|
1.21 |
% |
|
— |
% |
(6.6)% |
Net loan charge-offs |
$ |
1,622 |
|
$ |
841 |
|
$ |
1,232 |
|
|
92.9 |
% |
31.7 |
% |
Annualized net loan
charge-offs as a % of average loans (b) |
|
0.09 |
% |
|
0.05 |
% |
|
0.07 |
% |
|
80.0 |
% |
28.6 |
% |
|
|
|
|
|
|
|
CAPITAL &
LIQUIDITY: |
|
|
|
|
|
|
Total shareholders' equity /
Period end total assets |
|
11.93 |
% |
|
11.76 |
% |
|
11.00 |
% |
|
1.4 |
% |
8.5 |
% |
Tangible equity (d) / Tangible
assets (f) |
|
10.45 |
% |
|
10.27 |
% |
|
9.49 |
% |
|
1.8 |
% |
10.1 |
% |
Average shareholders' equity /
Average assets (b) |
|
11.94 |
% |
|
11.74 |
% |
|
11.00 |
% |
|
1.7 |
% |
8.5 |
% |
Average shareholders' equity /
Average loans (b) |
|
15.44 |
% |
|
15.48 |
% |
|
15.30 |
% |
|
(0.3)% |
0.9 |
% |
Average loans / Average
deposits (b) |
|
92.53 |
% |
|
91.11 |
% |
|
85.34 |
% |
|
1.6 |
% |
8.4 |
% |
|
|
|
|
|
|
|
Note:
Explanations for footnotes (a) - (k) are included at the end of the
financial tables in the "Financial Reconciliations"
section. |
|
PARK
NATIONAL CORPORATION |
Financial
Highlights |
Six
months ended June 30, 2024 and June 30,
2023 |
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
|
|
(in thousands, except common share and per common share
data and ratios) |
Six months ended June 30 |
Six months ended June 30 |
|
Percent change vs '23 |
INCOME STATEMENT: |
|
|
|
|
Net interest income |
$ |
193,460 |
|
$ |
183,770 |
|
|
5.3 |
% |
Provision for credit
losses |
|
5,293 |
|
|
2,675 |
|
|
97.9 |
% |
Other income |
|
54,994 |
|
|
49,402 |
|
|
11.3 |
% |
Other
expense |
|
152,417 |
|
|
152,388 |
|
|
— |
% |
Income before income taxes |
$ |
90,744 |
|
$ |
78,109 |
|
|
16.2 |
% |
Income
taxes |
|
16,171 |
|
|
12,792 |
|
|
26.4 |
% |
Net income |
$ |
74,573 |
|
$ |
65,317 |
|
|
14.2 |
% |
|
|
|
|
|
MARKET
DATA: |
|
|
|
|
Earnings per common share -
basic (a) |
$ |
4.62 |
|
$ |
4.03 |
|
|
14.6 |
% |
Earnings per common share -
diluted (a) |
|
4.60 |
|
|
4.01 |
|
|
14.7 |
% |
Quarterly cash dividend
declared per common share |
|
2.12 |
|
|
2.10 |
|
|
1.0 |
% |
|
|
|
|
|
Weighted average common shares
- basic (b) |
|
16,133,183 |
|
|
16,203,736 |
|
|
(0.4)% |
Weighted average common shares
- diluted (b) |
|
16,215,342 |
|
|
16,282,693 |
|
|
(0.4)% |
|
|
|
|
|
PERFORMANCE RATIOS:
(annualized) |
|
|
|
|
Return on average assets
(a)(b) |
|
1.52 |
% |
|
1.32 |
% |
|
15.2 |
% |
Return on average
shareholders' equity (a)(b) |
|
12.88 |
% |
|
12.07 |
% |
|
6.7 |
% |
Yield on loans |
|
6.06 |
% |
|
5.34 |
% |
|
13.5 |
% |
Yield on investment
securities |
|
3.87 |
% |
|
3.67 |
% |
|
5.4 |
% |
Yield on money market
instruments |
|
5.42 |
% |
|
4.84 |
% |
|
12.0 |
% |
Yield on interest earning
assets |
|
5.72 |
% |
|
4.99 |
% |
|
14.6 |
% |
Cost of interest bearing
deposits |
|
1.97 |
% |
|
1.31 |
% |
|
50.4 |
% |
Cost of borrowings |
|
4.17 |
% |
|
3.39 |
% |
|
23.0 |
% |
Cost of paying interest
bearing liabilities |
|
2.09 |
% |
|
1.44 |
% |
|
45.1 |
% |
Net interest margin (g) |
|
4.33 |
% |
|
4.07 |
% |
|
6.4 |
% |
Efficiency ratio (g) |
|
61.05 |
% |
|
64.84 |
% |
|
(5.8)% |
|
|
|
|
|
ASSET QUALITY
RATIOS: |
|
|
|
|
Net loan charge-offs |
$ |
2,463 |
|
$ |
1,231 |
|
|
100.1 |
% |
Net loan charge-offs as a % of
average loans (b) |
|
0.07 |
% |
|
0.03 |
% |
|
133.3 |
% |
|
|
|
|
|
CAPITAL &
LIQUIDITY |
|
|
|
|
Average shareholders' equity /
Average Assets (b) |
|
11.84 |
% |
|
10.92 |
% |
|
8.4 |
% |
Average shareholders' equity /
Average loans (b) |
|
15.46 |
% |
|
15.33 |
% |
|
0.8 |
% |
Average loans / Average
deposits (b) |
|
91.82 |
% |
|
84.69 |
% |
|
8.4 |
% |
|
|
|
|
|
OTHER DATA (NON-GAAP)
AND BALANCE SHEET INFORMATION: |
|
|
|
|
Average interest earning
assets |
|
9,032,554 |
|
|
9,194,469 |
|
|
(1.8)% |
Pre-tax, pre-provision net
income (j) |
|
96,037 |
|
|
80,784 |
|
|
18.9 |
% |
|
|
|
|
|
Note:
Explanations for footnotes (a) - (k) are included at the end of the
financial tables in the "Financial Reconciliations" section. |
|
|
|
|
|
|
|
|
|
PARK NATIONAL CORPORATION |
Consolidated Statements of Income |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Month Ended |
|
|
June 30 |
|
June 30 |
(in thousands, except share and per share
data) |
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
|
|
Interest income: |
|
|
|
|
|
|
|
|
Interest and fees on loans |
|
$ |
115,318 |
|
$ |
96,428 |
|
$ |
226,529 |
|
$ |
188,042 |
Interest on debt securities: |
|
|
|
|
|
|
|
|
Taxable |
|
|
10,950 |
|
|
13,431 |
|
|
22,849 |
|
|
26,410 |
Tax-exempt |
|
|
1,382 |
|
|
2,906 |
|
|
2,792 |
|
|
5,818 |
Other interest income |
|
|
1,254 |
|
|
1,909 |
|
|
3,374 |
|
|
5,305 |
Total interest income |
|
|
128,904 |
|
|
114,674 |
|
|
255,544 |
|
|
225,575 |
|
|
|
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
|
|
|
Interest on deposits: |
|
|
|
|
|
|
|
|
Demand and savings deposits |
|
|
20,370 |
|
|
18,068 |
|
|
40,225 |
|
|
32,280 |
Time deposits |
|
|
7,525 |
|
|
1,966 |
|
|
14,863 |
|
|
3,313 |
Interest on borrowings |
|
|
3,172 |
|
|
3,068 |
|
|
6,996 |
|
|
6,212 |
Total interest expense |
|
|
31,067 |
|
|
23,102 |
|
|
62,084 |
|
|
41,805 |
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
97,837 |
|
|
91,572 |
|
|
193,460 |
|
|
183,770 |
|
|
|
|
|
|
|
|
|
Provision for credit
losses |
|
|
3,113 |
|
|
2,492 |
|
|
5,293 |
|
|
2,675 |
|
|
|
|
|
|
|
|
|
Net interest income after provision for credit
losses |
|
|
94,724 |
|
|
89,080 |
|
|
188,167 |
|
|
181,095 |
|
|
|
|
|
|
|
|
|
Other income |
|
|
28,794 |
|
|
25,015 |
|
|
54,994 |
|
|
49,402 |
|
|
|
|
|
|
|
|
|
Other expense |
|
|
75,189 |
|
|
75,885 |
|
|
152,417 |
|
|
152,388 |
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
48,329 |
|
|
38,210 |
|
|
90,744 |
|
|
78,109 |
|
|
|
|
|
|
|
|
|
Income taxes |
|
|
8,960 |
|
|
6,626 |
|
|
16,171 |
|
|
12,792 |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
39,369 |
|
$ |
31,584 |
|
$ |
74,573 |
|
$ |
65,317 |
|
|
|
|
|
|
|
|
|
Per common
share: |
|
|
|
|
|
|
|
|
Net income - basic |
|
$ |
2.44 |
|
$ |
1.95 |
|
$ |
4.62 |
|
$ |
4.03 |
Net income - diluted |
|
$ |
2.42 |
|
$ |
1.94 |
|
$ |
4.60 |
|
$ |
4.01 |
|
|
|
|
|
|
|
|
|
Weighted average common shares - basic |
|
|
16,149,523 |
|
|
16,165,119 |
|
|
16,133,183 |
|
|
16,203,736 |
Weighted average common shares - diluted |
|
|
16,239,617 |
|
|
16,240,600 |
|
|
16,215,342 |
|
|
16,282,693 |
|
|
|
|
|
|
|
|
|
Cash dividends declared: |
|
|
|
|
|
|
|
|
Quarterly dividend |
|
$ |
1.06 |
|
$ |
1.05 |
|
$ |
2.12 |
|
$ |
2.10 |
|
|
|
|
|
|
|
|
|
PARK NATIONAL CORPORATION |
Consolidated Balance Sheets |
|
|
|
(in thousands, except share data) |
June 30, 2024 |
December 31, 2023 |
|
|
|
Assets |
|
|
|
|
|
Cash and due from banks |
$ |
142,593 |
|
$ |
160,477 |
|
Money market instruments |
|
118,872 |
|
|
57,791 |
|
Investment securities |
|
1,264,858 |
|
|
1,429,144 |
|
Loans |
|
7,664,377 |
|
|
7,476,221 |
|
Allowance for credit losses |
|
(86,575 |
) |
|
(83,745 |
) |
Loans, net |
|
7,577,802 |
|
|
7,392,476 |
|
Bank premises and equipment,
net |
|
72,131 |
|
|
74,211 |
|
Goodwill and other intangible
assets |
|
163,607 |
|
|
164,247 |
|
Other real estate owned |
|
1,210 |
|
|
983 |
|
Other
assets |
|
578,710 |
|
|
557,124 |
|
Total assets |
$ |
9,919,783 |
|
$ |
9,836,453 |
|
|
|
|
Liabilities and
Shareholders' Equity |
|
|
|
|
|
Deposits: |
|
|
Noninterest bearing |
$ |
2,542,446 |
|
$ |
2,628,234 |
|
Interest bearing |
|
5,770,059 |
|
|
5,414,332 |
|
Total deposits |
|
8,312,505 |
|
|
8,042,566 |
|
Borrowings |
|
283,874 |
|
|
517,329 |
|
Other
liabilities |
|
140,147 |
|
|
131,265 |
|
Total liabilities |
$ |
8,736,526 |
|
$ |
8,691,160 |
|
|
|
|
|
|
|
Shareholders'
Equity: |
|
|
Preferred shares (200,000
shares authorized; no shares outstanding at June 30, 2024 and
December 31, 2023) |
$ |
— |
|
$ |
— |
|
Common shares (No par value;
20,000,000 shares authorized; 17,623,104 shares issued at June
30, 2024 and December 31, 2023) |
|
460,821 |
|
|
463,280 |
|
Accumulated other
comprehensive loss, net of taxes |
|
(68,454 |
) |
|
(66,191 |
) |
Retained earnings |
|
943,149 |
|
|
903,877 |
|
Treasury shares (1,473,581 shares at June 30, 2024 and 1,506,625
shares at December 31, 2023) |
|
(152,259 |
) |
|
(155,673 |
) |
Total shareholders' equity |
$ |
1,183,257 |
|
$ |
1,145,293 |
|
Total liabilities and shareholders' equity |
$ |
9,919,783 |
|
$ |
9,836,453 |
|
|
|
|
|
PARK NATIONAL CORPORATION |
Consolidated Average Balance Sheets |
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
June 30, |
|
June 30, |
(in thousands) |
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
$ |
124,906 |
|
$ |
153,564 |
|
|
$ |
134,310 |
|
$ |
154,568 |
|
Money market instruments |
|
94,658 |
|
|
149,745 |
|
|
|
125,084 |
|
|
220,951 |
|
Investment securities |
|
1,285,086 |
|
|
1,777,878 |
|
|
|
1,326,807 |
|
|
1,792,199 |
|
Loans |
|
7,587,127 |
|
|
7,132,025 |
|
|
|
7,534,889 |
|
|
7,115,723 |
|
Allowance for credit losses |
|
(85,397 |
) |
|
(87,182 |
) |
|
|
(84,732 |
) |
|
(86,996 |
) |
Loans, net |
|
7,501,730 |
|
|
7,044,843 |
|
|
|
7,450,157 |
|
|
7,028,727 |
|
Bank premises and equipment,
net |
|
73,340 |
|
|
80,592 |
|
|
|
74,130 |
|
|
81,316 |
|
Goodwill and other intangible
assets |
|
163,816 |
|
|
165,129 |
|
|
|
163,977 |
|
|
165,292 |
|
Other real estate owned |
|
1,389 |
|
|
1,966 |
|
|
|
1,239 |
|
|
1,702 |
|
Other
assets |
|
566,401 |
|
|
544,088 |
|
|
|
561,648 |
|
|
543,198 |
|
Total assets |
$ |
9,811,326 |
|
$ |
9,917,805 |
|
|
$ |
9,837,352 |
|
$ |
9,987,953 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
Noninterest bearing |
$ |
2,572,947 |
|
$ |
2,847,921 |
|
|
$ |
2,570,989 |
|
$ |
2,908,857 |
|
Interest bearing |
|
5,626,577 |
|
|
5,509,022 |
|
|
|
5,635,332 |
|
|
5,492,931 |
|
Total deposits |
|
8,199,524 |
|
|
8,356,943 |
|
|
|
8,206,321 |
|
|
8,401,788 |
|
Borrowings |
|
312,963 |
|
|
347,191 |
|
|
|
337,333 |
|
|
370,067 |
|
Other
liabilities |
|
127,492 |
|
|
122,655 |
|
|
|
128,933 |
|
|
125,113 |
|
Total liabilities |
$ |
8,639,979 |
|
$ |
8,826,789 |
|
|
$ |
8,672,587 |
|
$ |
8,896,968 |
|
|
|
|
|
|
|
Shareholders'
Equity: |
|
|
|
|
|
Preferred shares |
$ |
— |
|
$ |
— |
|
|
$ |
— |
|
$ |
— |
|
Common shares |
|
459,546 |
|
|
458,884 |
|
|
|
461,532 |
|
|
460,713 |
|
Accumulated other
comprehensive loss, net of taxes |
|
(73,705 |
) |
|
(91,007 |
) |
|
|
(70,524 |
) |
|
(93,609 |
) |
Retained earnings |
|
937,765 |
|
|
873,810 |
|
|
|
927,705 |
|
|
869,567 |
|
Treasury shares |
|
(152,259 |
) |
|
(150,671 |
) |
|
|
(153,948 |
) |
|
(145,686 |
) |
Total shareholders' equity |
$ |
1,171,347 |
|
$ |
1,091,016 |
|
|
$ |
1,164,765 |
|
$ |
1,090,985 |
|
Total liabilities and shareholders' equity |
$ |
9,811,326 |
|
$ |
9,917,805 |
|
|
$ |
9,837,352 |
|
$ |
9,987,953 |
|
|
|
|
|
|
|
PARK NATIONAL CORPORATION |
Consolidated Statements of Income - Linked
Quarters |
|
|
|
|
|
|
|
|
2024 |
|
2024 |
|
2023 |
|
2023 |
|
|
2023 |
(in thousands, except per share data) |
2nd QTR |
1st QTR |
4th QTR |
3rd QTR |
2nd QTR |
|
|
|
|
|
|
Interest income: |
|
|
|
|
|
Interest and fees on loans |
$ |
115,318 |
$ |
111,211 |
$ |
108,495 |
$ |
103,258 |
|
$ |
96,428 |
Interest on debt securities: |
|
|
|
|
|
Taxable |
|
10,950 |
|
11,899 |
|
13,055 |
|
13,321 |
|
|
13,431 |
Tax-exempt |
|
1,382 |
|
1,410 |
|
2,248 |
|
2,900 |
|
|
2,906 |
Other interest income |
|
1,254 |
|
2,120 |
|
1,408 |
|
1,410 |
|
|
1,909 |
Total interest income |
|
128,904 |
|
126,640 |
|
125,206 |
|
120,889 |
|
|
114,674 |
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
Interest on deposits: |
|
|
|
|
|
Demand and savings deposits |
|
20,370 |
|
19,855 |
|
19,467 |
|
20,029 |
|
|
18,068 |
Time deposits |
|
7,525 |
|
7,338 |
|
6,267 |
|
3,097 |
|
|
1,966 |
Interest on borrowings |
|
3,172 |
|
3,824 |
|
4,398 |
|
3,494 |
|
|
3,068 |
Total interest expense |
|
31,067 |
|
31,017 |
|
30,132 |
|
26,620 |
|
|
23,102 |
|
|
|
|
|
|
Net interest income |
|
97,837 |
|
95,623 |
|
95,074 |
|
94,269 |
|
|
91,572 |
|
|
|
|
|
|
Provision for (recovery of)
credit losses |
|
3,113 |
|
2,180 |
|
1,809 |
|
(1,580 |
) |
|
2,492 |
|
|
|
|
|
|
Net interest income after provision for (recovery of )
credit losses |
|
94,724 |
|
93,443 |
|
93,265 |
|
95,849 |
|
|
89,080 |
|
|
|
|
|
|
Other income |
|
28,794 |
|
26,200 |
|
15,519 |
|
27,713 |
|
|
25,015 |
|
|
|
|
|
|
Other expense |
|
75,189 |
|
77,228 |
|
79,043 |
|
77,808 |
|
|
75,885 |
|
|
|
|
|
|
Income before income taxes |
|
48,329 |
|
42,415 |
|
29,741 |
|
45,754 |
|
|
38,210 |
|
|
|
|
|
|
Income taxes |
|
8,960 |
|
7,211 |
|
5,241 |
|
8,837 |
|
|
6,626 |
|
|
|
|
|
|
Net income |
$ |
39,369 |
$ |
35,204 |
$ |
24,500 |
$ |
36,917 |
|
$ |
31,584 |
|
|
|
|
|
|
Per common
share: |
|
|
|
|
|
Net income -
basic |
$ |
2.44 |
$ |
2.18 |
$ |
1.52 |
$ |
2.29 |
|
$ |
1.95 |
Net income -
diluted |
$ |
2.42 |
$ |
2.17 |
$ |
1.51 |
$ |
2.28 |
|
$ |
1.94 |
|
PARK NATIONAL CORPORATION |
Detail of other income and other expense - Linked
Quarters |
|
|
|
|
|
|
|
|
2024 |
|
2024 |
|
|
2023 |
|
|
2023 |
|
2023 |
(in thousands) |
2nd QTR |
1st QTR |
4th QTR |
3rd QTR |
2nd QTR |
|
|
|
|
|
|
Other income: |
|
|
|
|
|
Income from fiduciary activities |
$ |
10,728 |
$ |
10,024 |
|
$ |
8,943 |
|
$ |
9,100 |
$ |
8,816 |
Service charges on deposit accounts |
|
2,214 |
|
2,106 |
|
|
2,054 |
|
|
2,109 |
|
2,041 |
Other service income |
|
2,906 |
|
2,524 |
|
|
2,349 |
|
|
2,615 |
|
2,639 |
Debit card fee income |
|
6,580 |
|
6,243 |
|
|
6,583 |
|
|
6,652 |
|
6,830 |
Bank owned life insurance income |
|
1,565 |
|
2,629 |
|
|
1,373 |
|
|
1,448 |
|
1,332 |
ATM fees |
|
458 |
|
496 |
|
|
517 |
|
|
575 |
|
553 |
Loss on sale of debt securities, net |
|
— |
|
(398 |
) |
|
(7,875 |
) |
|
— |
|
— |
Gain (loss) on equity securities, net |
|
358 |
|
(687 |
) |
|
353 |
|
|
998 |
|
25 |
Other components of net periodic benefit income |
|
2,204 |
|
2,204 |
|
|
1,893 |
|
|
1,893 |
|
1,893 |
Miscellaneous |
|
1,781 |
|
1,059 |
|
|
(671 |
) |
|
2,323 |
|
886 |
Total other income |
$ |
28,794 |
$ |
26,200 |
|
$ |
15,519 |
|
$ |
27,713 |
$ |
25,015 |
|
|
|
|
|
|
Other expense: |
|
|
|
|
|
Salaries |
$ |
35,954 |
$ |
35,733 |
|
$ |
36,192 |
|
$ |
34,525 |
$ |
33,649 |
Employee benefits |
|
9,873 |
|
11,560 |
|
|
10,088 |
|
|
10,822 |
|
10,538 |
Occupancy expense |
|
2,975 |
|
3,181 |
|
|
3,344 |
|
|
3,203 |
|
3,214 |
Furniture and equipment expense |
|
2,454 |
|
2,583 |
|
|
2,824 |
|
|
3,060 |
|
3,103 |
Data processing fees |
|
9,542 |
|
8,808 |
|
|
9,605 |
|
|
9,700 |
|
9,582 |
Professional fees and services |
|
6,022 |
|
6,817 |
|
|
7,015 |
|
|
7,572 |
|
7,365 |
Marketing |
|
1,164 |
|
1,741 |
|
|
1,716 |
|
|
1,197 |
|
1,239 |
Insurance |
|
1,777 |
|
1,718 |
|
|
1,708 |
|
|
2,158 |
|
1,960 |
Communication |
|
1,002 |
|
1,036 |
|
|
993 |
|
|
1,135 |
|
1,045 |
State tax expense |
|
1,129 |
|
1,110 |
|
|
1,158 |
|
|
1,125 |
|
1,096 |
Amortization of intangible assets |
|
320 |
|
320 |
|
|
334 |
|
|
334 |
|
328 |
Foundation contributions |
|
— |
|
— |
|
|
1,000 |
|
|
— |
|
— |
Miscellaneous |
|
2,977 |
|
2,621 |
|
|
3,066 |
|
|
2,977 |
|
2,766 |
Total other expense |
$ |
75,189 |
$ |
77,228 |
|
$ |
79,043 |
|
$ |
77,808 |
$ |
75,885 |
|
|
|
|
|
|
PARK NATIONAL CORPORATION |
Asset Quality Information |
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
(in thousands, except ratios) |
June 30, 2024 |
March 31, 2024 |
|
2023 |
|
|
2022 |
|
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
|
|
|
|
|
|
|
Allowance for credit
losses: |
|
|
|
|
|
|
|
Allowance for credit losses, beginning of period |
$ |
85,084 |
|
$ |
83,745 |
|
$ |
85,379 |
|
$ |
83,197 |
|
$ |
85,675 |
|
$ |
56,679 |
|
$ |
51,512 |
|
Cumulative change in
accounting principle; adoption of ASU 2022-02 in 2023 and ASU
2016-13 in 2021 |
|
— |
|
|
— |
|
|
383 |
|
|
— |
|
|
6,090 |
|
|
— |
|
|
— |
|
Charge-offs |
|
3,097 |
|
|
3,240 |
|
|
10,863 |
|
|
9,133 |
|
|
5,093 |
|
|
10,304 |
|
|
11,177 |
|
Recoveries |
|
1,475 |
|
|
2,399 |
|
|
5,942 |
|
|
6,758 |
|
|
8,441 |
|
|
27,246 |
|
|
10,173 |
|
Net charge-offs (recoveries) |
|
1,622 |
|
|
841 |
|
|
4,921 |
|
|
2,375 |
|
|
(3,348 |
) |
|
(16,942 |
) |
|
1,004 |
|
Provision for (recovery of) credit losses |
|
3,113 |
|
|
2,180 |
|
|
2,904 |
|
|
4,557 |
|
|
(11,916 |
) |
|
12,054 |
|
|
6,171 |
|
Allowance for credit losses, end of period |
$ |
86,575 |
|
$ |
85,084 |
|
$ |
83,745 |
|
$ |
85,379 |
|
$ |
83,197 |
|
$ |
85,675 |
|
$ |
56,679 |
|
|
|
|
|
|
|
|
|
General reserve
trends: |
|
|
|
|
|
|
|
Allowance for credit losses,
end of period |
$ |
86,575 |
|
$ |
85,084 |
|
$ |
83,745 |
|
$ |
85,379 |
|
$ |
83,197 |
|
$ |
85,675 |
|
$ |
56,679 |
|
Allowance on accruing
purchased credit deteriorated ("PCD") loans (purchased credit
impaired ("PCI") loans for years 2020 and prior) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
167 |
|
|
268 |
|
Allowance on purchased loans
excluded from collectively evaluated loans (for years 2020 and
prior) |
|
N.A. |
|
|
N.A. |
|
|
N.A. |
|
|
N.A. |
|
|
N.A. |
|
|
678 |
|
|
— |
|
Specific reserves on individually evaluated loans |
|
5,311 |
|
|
5,032 |
|
|
4,983 |
|
|
3,566 |
|
|
1,616 |
|
|
5,434 |
|
|
5,230 |
|
General reserves on collectively evaluated loans |
$ |
81,264 |
|
$ |
80,052 |
|
$ |
78,762 |
|
$ |
81,813 |
|
$ |
81,581 |
|
$ |
79,396 |
|
$ |
51,181 |
|
|
|
|
|
|
|
|
|
Total loans |
$ |
7,664,377 |
|
$ |
7,525,005 |
|
$ |
7,476,221 |
|
$ |
7,141,891 |
|
$ |
6,871,122 |
|
$ |
7,177,785 |
|
$ |
6,501,404 |
|
Accruing PCD loans (PCI loans
for years 2020 and prior) |
|
2,420 |
|
|
2,454 |
|
|
2,835 |
|
|
4,653 |
|
|
7,149 |
|
|
11,153 |
|
|
14,331 |
|
Purchased loans excluded from
collectively evaluated loans (for years 2020 and prior) |
|
N.A. |
|
|
N.A. |
|
|
N.A. |
|
|
N.A. |
|
|
N.A. |
|
|
360,056 |
|
|
548,436 |
|
Individually evaluated loans (k) |
|
54,993 |
|
|
54,742 |
|
|
45,215 |
|
|
78,341 |
|
|
74,502 |
|
|
108,407 |
|
|
77,459 |
|
Collectively evaluated loans |
$ |
7,606,964 |
|
$ |
7,467,809 |
|
$ |
7,428,171 |
|
$ |
7,058,897 |
|
$ |
6,789,471 |
|
$ |
6,698,169 |
|
$ |
5,861,178 |
|
|
|
|
|
|
|
|
|
Asset Quality
Ratios: |
|
|
|
|
|
|
|
Net charge-offs (recoveries)
as a % of average loans |
|
0.09 |
% |
|
0.05 |
% |
|
0.07 |
% |
|
0.03 |
% |
(0.05)% |
(0.24)% |
|
0.02 |
% |
Allowance for credit losses as a % of period end loans |
|
1.13 |
% |
|
1.13 |
% |
|
1.12 |
% |
|
1.20 |
% |
|
1.21 |
% |
|
1.19 |
% |
|
0.87 |
% |
General reserve as a % of
collectively evaluated loans |
|
1.07 |
% |
|
1.07 |
% |
|
1.06 |
% |
|
1.16 |
% |
|
1.20 |
% |
|
1.19 |
% |
|
0.87 |
% |
|
|
|
|
|
|
|
|
Nonperforming
assets: |
|
|
|
|
|
|
|
Nonaccrual loans |
$ |
71,368 |
|
$ |
70,189 |
|
$ |
60,259 |
|
$ |
79,696 |
|
$ |
72,722 |
|
$ |
117,368 |
|
$ |
90,080 |
|
Accruing troubled debt
restructurings (for years 2022 and prior) (k) |
N.A. |
N.A. |
N.A. |
|
20,134 |
|
|
28,323 |
|
|
20,788 |
|
|
21,215 |
|
Loans
past due 90 days or more |
|
1,377 |
|
|
1,570 |
|
|
859 |
|
|
1,281 |
|
|
1,607 |
|
|
1,458 |
|
|
2,658 |
|
Total nonperforming loans |
$ |
72,745 |
|
$ |
71,759 |
|
$ |
61,118 |
|
$ |
101,111 |
|
$ |
102,652 |
|
$ |
139,614 |
|
$ |
113,953 |
|
Other real estate owned |
|
1,210 |
|
|
1,674 |
|
|
983 |
|
|
1,354 |
|
|
775 |
|
|
1,431 |
|
|
4,029 |
|
Other
nonperforming assets |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,750 |
|
|
3,164 |
|
|
3,599 |
|
Total nonperforming assets |
$ |
73,955 |
|
$ |
73,433 |
|
$ |
62,101 |
|
$ |
102,465 |
|
$ |
106,177 |
|
$ |
144,209 |
|
$ |
121,581 |
|
Percentage of nonaccrual loans to period end loans |
|
0.93 |
% |
|
0.93 |
% |
|
0.81 |
% |
|
1.12 |
% |
|
1.06 |
% |
|
1.64 |
% |
|
1.39 |
% |
Percentage of nonperforming
loans to period end loans |
|
0.95 |
% |
|
0.95 |
% |
|
0.82 |
% |
|
1.42 |
% |
|
1.49 |
% |
|
1.95 |
% |
|
1.75 |
% |
Percentage of nonperforming
assets to period end loans |
|
0.96 |
% |
|
0.98 |
% |
|
0.83 |
% |
|
1.43 |
% |
|
1.55 |
% |
|
2.01 |
% |
|
1.87 |
% |
Percentage of nonperforming
assets to period end total assets |
|
0.75 |
% |
|
0.74 |
% |
|
0.63 |
% |
|
1.04 |
% |
|
1.11 |
% |
|
1.55 |
% |
|
1.42 |
% |
|
|
|
|
|
|
|
|
Note:
Explanations for footnotes (a) - (k) are included at the end of the
financial tables in the "Financial Reconciliations" section. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PARK NATIONAL CORPORATION |
Asset Quality Information (continued) |
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
(in thousands, except ratios) |
June 30, 2024 |
March 31, 2024 |
|
2023 |
|
|
2022 |
|
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
|
|
|
|
|
|
|
New nonaccrual loan
information: |
|
|
|
|
|
|
|
Nonaccrual loans, beginning of
period |
$ |
70,189 |
|
$ |
60,259 |
|
$ |
79,696 |
|
$ |
72,722 |
|
$ |
117,368 |
|
$ |
90,080 |
|
$ |
67,954 |
|
New nonaccrual loans |
|
13,180 |
|
|
19,012 |
|
|
48,280 |
|
|
64,918 |
|
|
38,478 |
|
|
103,386 |
|
|
81,009 |
|
Resolved nonaccrual loans |
|
12,001 |
|
|
9,082 |
|
|
67,717 |
|
|
57,944 |
|
|
83,124 |
|
|
76,098 |
|
|
58,883 |
|
Nonaccrual loans, end of period |
$ |
71,368 |
|
$ |
70,189 |
|
$ |
60,259 |
|
$ |
79,696 |
|
$ |
72,722 |
|
$ |
117,368 |
|
$ |
90,080 |
|
|
|
|
|
|
|
|
|
Individually evaluated commercial loan portfolio
information (period end): (k) |
Unpaid principal balance |
$ |
57,184 |
|
$ |
57,053 |
|
$ |
47,564 |
|
$ |
80,116 |
|
$ |
75,126 |
|
$ |
109,062 |
|
$ |
78,178 |
|
Prior
charge-offs |
|
2,191 |
|
|
2,311 |
|
|
2,349 |
|
|
1,775 |
|
|
624 |
|
|
655 |
|
|
719 |
|
Remaining principal balance |
|
54,993 |
|
|
54,742 |
|
|
45,215 |
|
|
78,341 |
|
|
74,502 |
|
|
108,407 |
|
|
77,459 |
|
Specific reserves |
|
5,311 |
|
|
5,032 |
|
|
4,983 |
|
|
3,566 |
|
|
1,616 |
|
|
5,434 |
|
|
5,230 |
|
Book value, after specific reserves |
$ |
49,682 |
|
$ |
49,710 |
|
$ |
40,232 |
|
$ |
74,775 |
|
$ |
72,886 |
|
$ |
102,973 |
|
$ |
72,229 |
|
|
|
|
|
|
|
|
|
Note:
Explanations for footnotes (a) - (k) are included at the end of the
financial tables in the "Financial Reconciliations" section. |
PARK
NATIONAL CORPORATION |
|
|
|
Financial
Reconciliations |
|
|
|
NON-GAAP
RECONCILIATIONS |
|
|
|
|
THREE MONTHS ENDED |
|
SIX MONTHS ENDED |
(in thousands, except share and per share
data) |
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
June 30, 2024 |
June 30, 2023 |
Net interest income |
$ |
97,837 |
|
$ |
95,623 |
|
$ |
91,572 |
|
|
$ |
193,460 |
|
$ |
183,770 |
|
less purchase accounting accretion related to NewDominion and
Carolina Alliance acquisitions |
|
271 |
|
|
352 |
|
|
164 |
|
|
|
623 |
|
|
364 |
|
less interest income on former Vision Bank relationships |
|
5 |
|
|
2 |
|
|
13 |
|
|
|
7 |
|
|
587 |
|
Net interest income - adjusted |
$ |
97,561 |
|
$ |
95,269 |
|
$ |
91,395 |
|
|
$ |
192,830 |
|
$ |
182,819 |
|
|
|
|
|
|
|
|
Provision for credit
losses |
$ |
3,113 |
|
$ |
2,180 |
|
$ |
2,492 |
|
|
$ |
5,293 |
|
$ |
2,675 |
|
less recoveries on former Vision Bank relationships |
|
(111 |
) |
|
(953 |
) |
|
(25 |
) |
|
|
(1,064 |
) |
|
(748 |
) |
Provision for credit losses - adjusted |
$ |
3,224 |
|
$ |
3,133 |
|
$ |
2,517 |
|
|
$ |
6,357 |
|
$ |
3,423 |
|
|
|
|
|
|
|
|
Other
income |
$ |
28,794 |
|
$ |
26,200 |
|
$ |
25,015 |
|
|
$ |
54,994 |
|
$ |
49,402 |
|
less loss on sale of debt securities, net |
|
— |
|
|
(398 |
) |
|
— |
|
|
|
(398 |
) |
|
— |
|
less impact of strategic initiatives |
|
813 |
|
|
(155 |
) |
|
— |
|
|
|
658 |
|
|
— |
|
less Vision related gain on the sale of OREO, net |
|
(7 |
) |
|
121 |
|
|
— |
|
|
|
114 |
|
|
— |
|
less other service income related to former Vision Bank
relationships |
|
6 |
|
|
7 |
|
|
— |
|
|
|
13 |
|
|
135 |
|
Other income - adjusted |
$ |
27,982 |
|
$ |
26,625 |
|
$ |
25,015 |
|
|
$ |
54,607 |
|
$ |
49,267 |
|
|
|
|
|
|
|
|
Other
expense |
$ |
75,189 |
|
$ |
77,228 |
|
$ |
75,885 |
|
|
$ |
152,417 |
|
$ |
152,388 |
|
less core deposit intangible amortization related to NewDominion
and Carolina Alliance acquisitions |
|
320 |
|
|
320 |
|
|
328 |
|
|
|
640 |
|
|
655 |
|
less direct expenses related to collection of payments on former
Vision Bank loan relationships |
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
100 |
|
Other expense - adjusted |
$ |
74,869 |
|
$ |
76,908 |
|
$ |
75,557 |
|
|
$ |
151,777 |
|
$ |
151,633 |
|
|
|
|
|
|
|
|
Tax effect of
adjustments to net income identified above (i) |
$ |
(185 |
) |
$ |
(118 |
) |
$ |
26 |
|
|
$ |
(303 |
) |
$ |
(227 |
) |
|
|
|
|
|
|
|
Net income -
reported |
$ |
39,369 |
|
$ |
35,204 |
|
$ |
31,584 |
|
|
$ |
74,573 |
|
$ |
65,317 |
|
Net income - adjusted
(h) |
$ |
38,675 |
|
$ |
34,760 |
|
$ |
31,684 |
|
|
$ |
73,435 |
|
$ |
64,465 |
|
|
|
|
|
|
|
|
Diluted earnings per common
share |
$ |
2.42 |
|
$ |
2.17 |
|
$ |
1.94 |
|
|
$ |
4.60 |
|
$ |
4.01 |
|
Diluted earnings per common share, adjusted (h) |
$ |
2.38 |
|
$ |
2.15 |
|
$ |
1.95 |
|
|
$ |
4.53 |
|
$ |
3.96 |
|
|
|
|
|
|
|
|
Annualized return on average
assets (a)(b) |
|
1.61 |
% |
|
1.44 |
% |
|
1.28 |
% |
|
|
1.52 |
% |
|
1.32 |
% |
Annualized return on average assets, adjusted (a)(b)(h) |
|
1.59 |
% |
|
1.42 |
% |
|
1.28 |
% |
|
|
1.50 |
% |
|
1.30 |
% |
|
|
|
|
|
|
|
Annualized return on average
tangible assets (a)(b)(e) |
|
1.64 |
% |
|
1.46 |
% |
|
1.30 |
% |
|
|
1.55 |
% |
|
1.34 |
% |
Annualized return on average tangible assets, adjusted
(a)(b)(e)(h) |
|
1.61 |
% |
|
1.44 |
% |
|
1.30 |
% |
|
|
1.53 |
% |
|
1.32 |
% |
|
|
|
|
|
|
|
Annualized return on average
shareholders' equity (a)(b) |
|
13.52 |
% |
|
12.23 |
% |
|
11.61 |
% |
|
|
12.88 |
% |
|
12.07 |
% |
Annualized return on average shareholders' equity, adjusted
(a)(b)(h) |
|
13.28 |
% |
|
12.07 |
% |
|
11.65 |
% |
|
|
12.68 |
% |
|
11.92 |
% |
|
|
|
|
|
|
|
Annualized return on average
tangible equity (a)(b)(c) |
|
15.72 |
% |
|
14.24 |
% |
|
13.68 |
% |
|
|
14.98 |
% |
|
14.23 |
% |
Annualized return on average tangible equity, adjusted
(a)(b)(c)(h) |
|
15.44 |
% |
|
14.06 |
% |
|
13.73 |
% |
|
|
14.76 |
% |
|
14.04 |
% |
|
|
|
|
|
|
|
Efficiency ratio (g) |
|
59.09 |
% |
|
63.07 |
% |
|
64.58 |
% |
|
|
61.05 |
% |
|
64.84 |
% |
Efficiency ratio, adjusted (g)(h) |
|
59.35 |
% |
|
62.78 |
% |
|
64.40 |
% |
|
|
61.04 |
% |
|
64.82 |
% |
|
|
|
|
|
|
|
Annualized net interest margin
(g) |
|
4.39 |
% |
|
4.28 |
% |
|
4.07 |
% |
|
|
4.33 |
% |
|
4.07 |
% |
Annualized net interest margin, adjusted (g)(h) |
|
4.38 |
% |
|
4.26 |
% |
|
4.06 |
% |
|
|
4.32 |
% |
|
4.05 |
% |
Note: Explanations for footnotes (a) - (k) are included at the end
of the financial tables in the "Financial Reconciliations"
section. |
|
|
|
|
|
|
PARK
NATIONAL CORPORATION |
|
|
|
Financial
Reconciliations (continued) |
|
|
|
|
|
|
|
|
|
|
(a) Reported
measure uses net income |
(b) Averages are
for the three months ended June 30, 2024, March 31, 2024, and June
30, 2023 and the six months ended June 30, 2024 and June 30, 2023,
as appropriate |
(c) Net income
for each period divided by average tangible equity during the
period. Average tangible equity equals average shareholders'
equity during the applicable period less average goodwill and other
intangible assets during the applicable period. |
|
|
|
|
|
|
|
RECONCILIATION OF AVERAGE SHAREHOLDERS' EQUITY TO AVERAGE
TANGIBLE EQUITY: |
|
THREE MONTHS ENDED |
|
SIX MONTHS ENDED |
|
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
June 30, 2024 |
June 30, 2023 |
AVERAGE SHAREHOLDERS' EQUITY |
$ |
1,171,347 |
$ |
1,158,184 |
$ |
1,091,016 |
|
$ |
1,164,765 |
$ |
1,090,985 |
Less:
Average goodwill and other intangible assets |
|
163,816 |
|
164,137 |
|
165,129 |
|
|
163,977 |
|
165,292 |
AVERAGE TANGIBLE EQUITY |
$ |
1,007,531 |
$ |
994,047 |
$ |
925,887 |
|
$ |
1,000,788 |
$ |
925,693 |
|
|
|
|
|
|
|
(d) Tangible
equity divided by common shares outstanding at period end. Tangible
equity equals total shareholders' equity less goodwill and other
intangible assets, in each case at the end of the period. |
|
|
|
|
|
|
|
RECONCILIATION OF TOTAL SHAREHOLDERS' EQUITY TO TANGIBLE
EQUITY: |
|
June 30, 2024 |
March 31, 2024 |
June 30, 2024 |
|
|
|
TOTAL SHAREHOLDERS' EQUITY |
$ |
1,183,257 |
$ |
1,161,979 |
$ |
1,088,757 |
|
|
|
Less:
Goodwill and other intangible assets |
|
163,607 |
|
163,927 |
|
164,915 |
|
|
|
TANGIBLE EQUITY |
$ |
1,019,650 |
$ |
998,052 |
$ |
923,842 |
|
|
|
|
|
|
|
|
|
|
(e) Net income
for each period divided by average tangible assets during the
period. Average tangible assets equal average assets less
average goodwill and other intangible assets, in each case during
the applicable period. |
|
|
|
|
|
|
|
RECONCILIATION OF AVERAGE ASSETS TO AVERAGE TANGIBLE
ASSETS |
|
THREE MONTHS ENDED |
|
SIX MONTHS ENDED |
|
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
June 30, 2024 |
June 30, 2023 |
AVERAGE ASSETS |
$ |
9,811,326 |
$ |
9,863,378 |
$ |
9,917,805 |
|
$ |
9,837,352 |
$ |
9,987,953 |
Less:
Average goodwill and other intangible assets |
|
163,816 |
|
164,137 |
|
165,129 |
|
|
163,977 |
|
165,292 |
AVERAGE TANGIBLE ASSETS |
$ |
9,647,510 |
$ |
9,699,241 |
$ |
9,752,676 |
|
$ |
9,673,375 |
$ |
9,822,661 |
|
|
|
|
|
|
|
(f) Tangible
equity divided by tangible assets. Tangible assets equal total
assets less goodwill and other intangible assets, in each case at
the end of the period. |
|
|
|
|
|
|
|
RECONCILIATION OF TOTAL ASSETS TO TANGIBLE
ASSETS: |
|
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
|
|
TOTAL ASSETS |
$ |
9,919,783 |
$ |
9,881,077 |
$ |
9,899,551 |
|
|
|
Less:
Goodwill and other intangible assets |
|
163,607 |
|
163,927 |
|
164,915 |
|
|
|
TANGIBLE ASSETS |
$ |
9,756,176 |
$ |
9,717,150 |
$ |
9,734,636 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(g) Efficiency
ratio is calculated by dividing total other expense by the sum of
fully taxable equivalent net interest income and other income.
Fully taxable equivalent net interest income reconciliation is
shown assuming a 21% corporate federal income tax rate.
Additionally, net interest margin is calculated on a fully taxable
equivalent basis by dividing fully taxable equivalent net interest
income by average interest earning assets, in each case during the
applicable period. |
|
|
|
|
|
|
|
RECONCILIATION OF FULLY TAXABLE EQUIVALENT NET INTEREST
INCOME TO NET INTEREST INCOME |
|
THREE MONTHS ENDED |
|
SIX MONTHS ENDED |
|
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
June 30, 2024 |
June 30, 2023 |
Interest income |
$ |
128,904 |
$ |
126,640 |
$ |
114,674 |
|
$ |
255,544 |
$ |
225,575 |
Fully
taxable equivalent adjustment |
|
605 |
|
616 |
|
920 |
|
|
1,221 |
|
1,846 |
Fully taxable equivalent interest income |
$ |
129,509 |
$ |
127,256 |
$ |
115,594 |
|
$ |
256,765 |
$ |
227,421 |
Interest expense |
|
31,067 |
|
31,017 |
|
23,102 |
|
|
62,084 |
|
41,805 |
Fully taxable equivalent net interest income |
$ |
98,442 |
$ |
96,239 |
$ |
92,492 |
|
$ |
194,681 |
$ |
185,616 |
|
|
|
|
|
|
|
(h) Adjustments
to net income for each period presented are detailed in the
non-GAAP reconciliations of net interest income, provision for
credit losses, other income, other expense and tax effect of
adjustments to net income. |
(i) The tax
effect of adjustments to net income was calculated assuming a 21%
corporate federal income tax rate. |
(j) Pre-tax,
pre-provision ("PTPP") net income is calculated as net income, plus
income taxes, plus the provision for credit losses, in each case
during the applicable period. PTPP net income is a common industry
metric utilized in capital analysis and review. PTPP is used to
assess the operating performance of Park while excluding the impact
of the provision for credit losses. |
|
|
|
|
|
|
|
RECONCILIATION OF PRE-TAX, PRE-PROVISION NET
INCOME |
|
THREE MONTHS ENDED |
|
SIX MONTHS ENDED |
|
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
June 30, 2024 |
June 30, 2023 |
Net income |
$ |
39,369 |
$ |
35,204 |
$ |
31,584 |
|
$ |
74,573 |
$ |
65,317 |
Plus: Income taxes |
|
8,960 |
|
7,211 |
|
6,626 |
|
|
16,171 |
|
12,792 |
Plus:
Provision for credit losses |
|
3,113 |
|
2,180 |
|
2,492 |
|
|
5,293 |
|
2,675 |
Pre-tax, pre-provision net income |
$ |
51,442 |
$ |
44,595 |
$ |
40,702 |
|
$ |
96,037 |
$ |
80,784 |
|
|
|
|
|
|
|
(k) Effective
January 1, 2023, Park adopted Accounting Standards Update ("ASU")
2022-02. Among other things, this ASU eliminated the concept of
troubled debt restructurings ("TDRs"). As a result of the adoption
of this ASU and elimination of the concept of TDRs, total
nonperforming loans ("NPLs") and total nonperforming assets
("NPAs") each decreased by $20.1 million effective January 1, 2023.
Additionally, as a result of the adoption of this ASU, individually
evaluated loans decreased by $11.5 million effective January 1,
2023. |
Media contact: Michelle Hamilton, 740-349-6014, media@parknationalbank.com
Investor contact: Brady Burt, 740-322-6844, investor@parknationalbank.com
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