NEWARK, Ohio, Feb. 7, 2012 (GLOBE NEWSWIRE) -- Park National Corporation (NYSE Amex:PRK) (Park) today announced financial results for the three months (fourth quarter) and year ended December 31, 2011. The financial statements include the effect of a restatement of previously reported results due to a change in the timing for recognition of losses at Park's Florida-based subsidiary Vision Bank. Park also reported a record high in net income for The Park National Bank, Park's subsidiary that consists of 11 community banking divisions in Ohio.
On January 31, 2012, Park filed a Current Report on form 8-K with the Securities and Exchange Commission, describing Park's plan to restate the results for the year ended December 31, 2010 and each quarterly period in 2011. The restatements include recognition of loan loss provisions and other real estate owned devaluations at Vision Bank in 2010 instead of 2011. The result was a reduction in 2010 net income of $16.1 million, or $1.06 per diluted common share, all affecting the fourth quarter of 2010. The reduction to 2010 net income is fully offset by an increase to net income during 2011.
Park previously announced net income for the year ended December 31, 2010 of $74.2 million, or $4.51 per diluted common share and net income for the nine months ended September 30, 2011 of $60.0 million, or $3.61 per diluted common share. All amounts discussed in the remainder of this news release represent the restated results for 2010 and 2011.
Park's net income was $84.7 million for the year ended December 31, 2011 (2011 year) and its net income was $58.1 million for the same period in 2010. Net income for the fourth quarter of 2011 was $13.2 million, compared to a loss of $3.4 million for the same period in 2010.
Net income per diluted common share for the 2011 year was $5.12, compared to $3.45 per diluted common share for the same period in 2010. Net income (loss) per diluted common share for the 2011 fourth quarter was $0.76, compared to $(0.32) per diluted common share in the fourth quarter of 2010.
Ohio Operational Results
Excluding Vision Bank, Park reported net income of $104.7 million for the 2011 year, compared to $103.5 million for the same period in 2010. This performance resulted in return on average assets of 1.62 percent and 1.58 percent for Park's Ohio operations in 2011 and 2010, respectively. Additionally, Park's two Ohio-based subsidiaries, The Park National Bank and Guardian Financial Services Company, reported record annual net incomes of $106.9 million and $2.7 million, respectively, for 2011.
"Ohio's results continue to be exceptional. Our successful community banks in Ohio represent the great majority of our organization, and we look forward to continuing our tradition of service excellence coupled with consistent performance in 2012," said Park Chairman C. Daniel DeLawder. "The pending sale of the Vision Bank operations, which we expect to conclude in the first quarter of 2012, allows us to concentrate fully on our operations in Ohio and our powerful earnings engine as we move forward."
Credit Quality
Park significantly reduced non-performing assets during 2011. At December 31, 2011, non-performing assets were $272.6 million, or 3.91 percent of total assets, compared to $334.6 million or 4.59 percent of total assets at December 31, 2010. Vision Bank reduced non-performing loans by approximately $70 million during 2011, accounting for most of this large decline.
Sale of Investment Securities
During 2011, Park realized a pre-tax gain of $28.8 million from the sale of approximately $581 million of investment securities. During 2010, Park realized a pre-tax gain of $11.9 million from the sale of approximately $448 million of investment securities.
Headquartered in Newark, Ohio, Park National Corporation has $7.0 billion in total assets (as of December 31, 2011). Park consists of 13 community bank divisions and two specialty finance companies. Park's Ohio-based banking operations are conducted through Park subsidiary The Park National Bank and its divisions which include Fairfield National Bank Division, Richland Bank Division, Century National Bank Division, First-Knox National Bank Division, Farmers & Savings Bank Division, United Bank Division, Second National Bank Division, Security National Bank Division, Unity National Bank Division, The Park National Bank of Southwest Ohio & Northern Kentucky Division and Scope Leasing, Inc. (d.b.a. Scope Aircraft Finance). Park's other banking subsidiary is Vision Bank (headquartered in Panama City, Florida), and its Vision Bank Division (of Gulf Shores, Alabama). Park also includes Guardian Financial Services Company (d.b.a. Guardian Finance Company).
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. 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: deterioration in the asset value of Park's loan portfolio may be worse than expected due to a number of factors, such as adverse changes in economic conditions that impair the ability of borrowers to repay their loans, the underlying value of the collateral could prove less valuable than assumed and cash flows may be worse than expected; Park's ability to sell OREO properties at prices as favorable as anticipated; Park's ability to execute its business plan successfully and within the expected timeframe; general economic and financial market conditions, and weakening in the economy, specifically the real estate market and credit market, either nationally or in the states in which Park and its subsidiaries do business, may be worse than expected which could decrease the demand for loan, deposit and other financial services and increase loan delinquencies and defaults; changes in interest rates and prices may adversely impact the value of securities, loans, deposits and other financial instruments and the interest rate sensitivity of our consolidated balance sheet; changes in consumer spending, borrowing and saving habits; our liquidity requirements could be adversely affected by changes in our assets and liabilities; competitive factors among financial institutions increase significantly, including product and pricing pressures and our ability to attract, develop and retain qualified bank professionals; the nature, timing and effect of changes in banking regulations or other regulatory or legislative requirements affecting the respective businesses of Park and its subsidiaries, including changes in laws and regulations concerning taxes, accounting, banking, securities and other aspects of the financial services industry, specifically the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act"), as well as future regulations which will be adopted by the relevant regulatory agencies, including the Consumer Financial Protection Bureau, to implement the Dodd-Frank Act's provisions; the effect of changes in accounting policies and practices, as may be adopted by the Financial Accounting Standards Board, the SEC, the Public Company Accounting Oversight Board and other regulatory agencies, and the accuracy of our assumptions and estimates used to prepare our financial statements; the effect of fiscal and governmental policies of the United States federal government; adequacy of our risk management program; a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors and other service providers, including as a result of cyber attacks; demand for loans in the respective market areas served by Park and its subsidiaries; closing of the transactions with Home BancShares, Inc. and Centennial Bank contemplated by the Purchase and Assumption Agreement dated November 16, 2011, which is dependent on the receipt of regulatory and other approvals and the satisfaction of specified conditions for closing, the timing of which cannot be predicted at this point; and other risk factors relating to the banking industry as detailed from time to time in Park's reports filed with the Securities and Exchange Commission including those described in "Item 1A. Risk Factors" of Part I of Park's Annual Report on Form 10-K for the fiscal year ended December 31, 2010 and in "Item 1A. Risk Factors" of Part II of Park's Quarterly Report on Form 10-Q for the period ended September 30, 2011. Undue reliance should not be placed on the forward-looking statements, which speak only as of the date hereof. Park does not undertake, and specifically disclaims any obligation, to publicly release the result 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 is made, or reflect the occurrence of unanticipated events, except to the extent required by law.
| PARK NATIONAL CORPORATION | |||||
| Financial Highlights | |||||
| Three months ended December 31, 2011, September 30, 2011, and December 31, 2010 | |||||
| 2011 | 2010 | Percent change vs. | |||
| (in thousands, except share and per share data) | 4th QTR | 3rd QTR | 4th QTR | 3Q '11 | 4Q '10 |
| INCOME STATEMENT: | (Restated) | (Restated) | |||
| Net interest income | $ 66,279 | $ 67,620 | $ 68,498 | -2.0% | -3.2% |
| Provision for loan losses | 16,218 | 16,438 | 42,626 | -1.3% | -62.0% |
| Other income | 17,885 | 18,027 | 12,129 | -0.8% | 47.5% |
| Gain on sale of securities | 3,367 | 3,465 | 45 | -2.8% | N.M. |
| Total other expense | 49,365 | 45,599 | 46,520 | 8.3% | 6.1% |
| Income (loss) before income taxes | $ 21,948 | $ 27,075 | $ (8,474) | -18.9% | N.M. |
| Federal income taxes | 2,651 | 6,694 | (5,053) | -60.4% | -152.5% |
| State income taxes | 6,088 | -- | -- | N.M. | N.M. |
| Net income (loss) | $ 13,209 | $ 20,381 | $ (3,421) | -35.2% | N.M. |
| Preferred stock dividends and accretion | 1,464 | 1,464 | 1,452 | 0.0% | 0.8% |
| Net income (loss) available to common shareholders | $ 11,745 | $ 18,917 | $ (4,873) | -37.9% | N.M. |
| MARKET DATA: | |||||
| Earnings (loss) per common share - basic (b) | $ 0.76 | $ 1.23 | $ (0.32) | -38.2% | N.M. |
| Earnings (loss) per common share - diluted (b) | 0.76 | 1.23 | (0.32) | -38.2% | N.M. |
| Cash dividends per common share | 0.94 | 0.94 | 0.94 | 0.0% | 0.0% |
| Common book value per common share at period end | 41.99 | 42.67 | 41.07 | -1.6% | 2.2% |
| Stock price per common share at period end | 65.06 | 52.88 | 72.67 | 23.0% | -10.5% |
| Market capitalization at period end | 1,002,309 | 814,294 | 1,119,041 | 23.1% | -10.4% |
| Weighted average common shares - basic (a) | 15,403,861 | 15,398,909 | 15,340,427 | 0.0% | 0.4% |
| Weighted average common shares - diluted (a) | 15,403,861 | 15,398,909 | 15,352,600 | 0.0% | 0.3% |
| Common shares outstanding at period end | 15,405,912 | 15,398,904 | 15,398,934 | 0.0% | 0.0% |
| PERFORMANCE RATIOS: (annualized) | |||||
| Return on average assets (a)(b) | 0.66% | 1.04% | -0.28% | -36.5% | N.M. |
| Return on average common equity (a)(b) | 7.10% | 11.51% | -2.92% | -38.3% | N.M. |
| Yield on loans | 5.59% | 5.59% | 5.73% | 0.0% | -2.4% |
| Yield on investments | 3.23% | 3.40% | 3.87% | -5.0% | -16.5% |
| Yield on earning assets | 4.93% | 4.95% | 5.23% | -0.4% | -5.7% |
| Cost of interest bearing deposits | 0.60% | 0.63% | 0.82% | -4.8% | -26.8% |
| Cost of borrowings | 2.68% | 2.69% | 2.76% | -0.4% | -2.9% |
| Cost of paying liabilities | 1.07% | 1.07% | 1.21% | 0.0% | -11.6% |
| Net interest margin | 4.08% | 4.09% | 4.25% | -0.2% | -4.0% |
| Efficiency ratio (g) | 58.34% | 52.95% | 57.31% | 10.2% | 1.8% |
| OTHER RATIOS (NON GAAP): | |||||
| Annualized return on average tangible assets (a)(b)(e) | 0.66% | 1.05% | -0.28% | -37.1% | N.M. |
| Annualized return on average tangible common equity (a)(b)(c) | 8.03% | 13.05% | -3.31% | -38.5% | N.M. |
| Tangible common book value per common share (d) | $ 37.13 | $ 37.71 | $ 35.98 | -1.5% | 3.2% |
| PARK NATIONAL CORPORATION | |||||
| Financial Highlights (continued) | |||||
| Three months ended December 31, 2011, September 30, 2011, and December 31, 2010 | |||||
| Percent change vs. | |||||
| BALANCE SHEET: | December 31, 2011 | September 30, 2011 | December 31, 2010 | 3Q '11 | 4Q '10 |
| (Restated) | (Restated) | ||||
| Investment securities | $ 1,708,473 | $ 1,708,631 | $ 2,039,791 | 0.0% | -16.2% |
| Loans | 4,317,099 | 4,680,575 | 4,732,685 | -7.8% | -8.8% |
| Allowance for loan losses | 64,444 | 107,310 | 143,576 | -39.9% | -55.1% |
| Goodwill and other intangibles | 74,843 | 76,370 | 78,377 | -2.0% | -4.5% |
| Other real estate owned | 42,272 | 46,911 | 41,709 | -9.9% | 1.3% |
| Assets held for sale | 379,683 | 0 | 0 | N.M. | N.M. |
| Total assets | 6,974,845 | 7,095,097 | 7,282,261 | -1.7% | -4.2% |
| Total deposits | 4,465,114 | 5,089,187 | 5,095,420 | -12.3% | -12.4% |
| Borrowings | 1,162,026 | 1,142,043 | 1,375,652 | 1.7% | -15.5% |
| Liabilities held for sale | 536,186 | 0 | 0 | N.M. | N.M. |
| Stockholders' equity | 744,964 | 755,052 | 729,708 | -1.3% | 2.1% |
| Common equity | 646,818 | 657,120 | 632,418 | -1.6% | 2.3% |
| Tangible common equity (d) | 571,975 | 580,750 | 554,041 | -1.5% | 3.2% |
| Nonperforming loans | 224,575 | 229,814 | 289,268 | -2.3% | -22.4% |
| Nonperforming assets | 266,847 | 276,725 | 330,977 | -3.6% | -19.4% |
| Past due 90 day loans and still accruing | 3,489 | 2,162 | 3,590 | 61.4% | -2.8% |
| ASSET QUALITY RATIOS: | |||||
| Loans as a % of period end assets | 61.90% | 65.97% | 64.99% | -6.2% | -4.8% |
| Nonperforming loans as a % of period end loans | 5.20% | 4.91% | 6.11% | 5.9% | -14.9% |
| Past due 90 day loans as a % of period end loans | 0.08% | 0.05% | 0.08% | 60.0% | 0.0% |
| Nonperforming assets / Period end loans + OREO | 6.12% | 5.85% | 6.93% | 4.6% | -11.7% |
| Allowance for loan losses as a % of period end loans | 1.49% | 2.29% | 3.03% | -34.9% | -50.8% |
| Net loan charge-offs | $ 45,764 | $ 29,302 | $ 16,456 | 56.2% | 178.1% |
| Annualized net loan charge-offs as a % of average loans (a) | 3.88% | 2.48% | 1.39% | 56.5% | 179.1% |
| CAPITAL & LIQUIDITY: | |||||
| Total equity / Period end assets | 10.68% | 10.64% | 10.02% | 0.4% | 6.6% |
| Common equity / Period end assets | 9.27% | 9.26% | 8.68% | 0.1% | 6.8% |
| Tangible common equity (d) / Tangible assets (f) | 8.29% | 8.27% | 7.69% | 0.2% | 7.8% |
| Average equity / Average assets (a) | 10.63% | 10.42% | 10.84% | 2.0% | -1.9% |
| Average equity / Average loans (a) | 16.13% | 15.98% | 16.19% | 0.9% | -0.4% |
| Average loans / Average deposits (a) | 91.96% | 90.32% | 91.68% | 1.8% | 0.3% |
| PARK NATIONAL CORPORATION | |||||
| Financial Highlights (continued) | |||||
| Twelve months ended December 31, 2011 and 2010 | |||||
| December 31, | December 31, | Percent | |||
| (in thousands, except share and per share data) | 2011 | 2010 | change | ||
| INCOME STATEMENT: | (Restated) | ||||
| Net interest income | $ 273,234 | $ 274,044 | -0.3% | ||
| Provision for loan losses | 59,272 | 87,080 | -31.9% | ||
| Other income | 66,081 | 63,016 | 4.9% | ||
| Gain on sale of securities | 28,829 | 11,864 | 143.0% | ||
| Total other expense | 188,317 | 187,107 | 0.6% | ||
| Income before income taxes | $ 120,555 | $ 74,737 | 61.3% | ||
| Federal income taxes | $ 29,727 | $ 17,797 | 67.0% | ||
| State income taxes | 6,088 | (1,161) | N.M. | ||
| Net income | $ 84,740 | $ 58,101 | 45.8% | ||
| Preferred stock dividends and accretion | 5,856 | 5,807 | 0.8% | ||
| Net income available to common shareholders | $ 78,884 | $ 52,294 | 50.8% | ||
| MARKET DATA: | |||||
| Earnings per commmon share - basic (b) | $ 5.12 | $ 3.45 | 48.4% | ||
| Earnings per common share - diluted (b) | $ 5.12 | $ 3.45 | 48.4% | ||
| Cash dividends per common share | 3.76 | 3.76 | 0.0% | ||
| Weighted average common shares - basic (a) | 15,400,155 | 15,152,692 | 1.6% | ||
| Weighted average common shares - diluted (a) | 15,401,446 | 15,155,735 | 1.6% | ||
| PERFORMANCE RATIOS: | |||||
| Return on average assets (a)(b) | 1.09% | 0.74% | 47.3% | ||
| Return on average common equity (a)(b) | 12.21% | 8.05% | 51.7% | ||
| Yield on loans | 5.61% | 5.80% | -3.3% | ||
| Yield on investments | 3.61% | 4.25% | -15.1% | ||
| Yield on earning assets | 5.03% | 5.36% | -6.2% | ||
| Cost of interest bearing deposits | 0.66% | 0.98% | -32.7% | ||
| Cost of borrowings | 2.63% | 2.88% | -8.7% | ||
| Cost of paying liabilities | 1.09% | 1.35% | -19.3% | ||
| Net interest margin | 4.14% | 4.26% | -2.8% | ||
| Efficiency ratio (g) | 55.18% | 55.18% | 0.0% | ||
| ASSET QUALITY RATIOS: | |||||
| Net loan charge-offs | $ 125,084 | $ 60,222 | 107.7% | ||
| Net loan charge-offs as a % of average loans (a) | 2.65% | 1.30% | 103.8% | ||
| CAPITAL AND LIQUIDITY: | |||||
| Average equity / Average assets (a) | 10.32% | 10.60% | -2.6% | ||
| Average equity / Average loans (a) | 15.78% | 16.08% | -1.9% | ||
| Average loans / Average deposits (a) | 90.78% | 89.59% | 1.3% | ||
| OTHER RATIOS (NON GAAP): | |||||
| Return on average tangible assets (a)(b)(e) | 1.11% | 0.75% | 48.0% | ||
| Return on average tangible common equity (a)(b)(c) | 13.86% | 9.18% | 51.0% | ||
| N.M. - Not meaningful | |||||
| PARK NATIONAL CORPORATION | |||||
| Financial Highlights (continued) | |||||
| a) Averages are for the quarters ended December 31, 2011, September 30, 2011, and December 31, 2010, and the twelve-month periods ended December 31, 2011 and December 31, 2010. | |||||
| (b) Reported measure uses net income (loss) available to common shareholders. | |||||
| (c) Net income (loss) available to common shareholders for each period divided by average tangible common equity during the period. Average tangible common equity equals average stockholders' equity during the applicable period less (i) average preferred stock during the applicable period and (ii) average goodwill and other intangibles during the applicable period. | |||||
| RECONCILIATION OF AVERAGE STOCKHOLDERS' EQUITY TO AVERAGE TANGIBLE COMMON EQUITY: | |||||
| THREE MONTHS ENDED | TWELVE MONTHS ENDED | ||||
| December 31, 2011 | September 30, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 | |
| AVERAGE STOCKHOLDERS' EQUITY | $ 754,196 | $ 749,609 | $ 760,381 | $ 743,873 | $ 746,510 |
| Less: Average preferred stock | 98,023 | 97,808 | 97,174 | 97,704 | 96,873 |
| Average goodwill and other intangibles | 76,041 | 76,734 | 78,823 | 77,055 | 80,072 |
| AVERAGE TANGIBLE COMMON EQUITY | $ 580,132 | $ 575,067 | $ 584,384 | $ 569,114 | $ 569,565 |
| (d) Tangible common equity equals ending stockholders' equity less preferred stock and goodwill and other intangibles, in each case at the end of the period. | |||||
| RECONCILIATION OF STOCKHOLDERS' EQUITY TO TANGIBLE COMMON EQUITY: | |||||
| December 31, 2011 | September 30, 2011 | December 31, 2010 | |||
| STOCKHOLDERS' EQUITY | $ 744,964 | $ 755,052 | $ 729,708 | ||
| Less: Preferred stock | 98,146 | 97,932 | 97,290 | ||
| Goodwill and other intangibles | 74,843 | 76,370 | 78,377 | ||
| TANGIBLE COMMON EQUITY | $ 571,975 | $ 580,750 | $ 554,041 | ||
| (e) Net income (loss) available to common shareholders for each period divided by average tangible assets during the period. Average tangible assets equals average assets less average goodwill and other intangibles. | |||||
| RECONCILIATION OF AVERAGE ASSETS TO AVERAGE TANGIBLE ASSETS: | |||||
| THREE MONTHS ENDED | TWELVE MONTHS ENDED | ||||
| December 31, 2011 | September 30, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 | |
| AVERAGE ASSETS | $ 7,092,465 | $ 7,190,842 | $ 7,013,677 | $ 7,206,171 | $ 7,042,705 |
| Less: Average goodwill and other intangibles | 76,041 | 76,734 | 78,823 | 77,055 | 80,072 |
| AVERAGE TANGIBLE ASSETS | $ 7,016,424 | $ 7,114,108 | $ 6,934,854 | $ 7,129,116 | $ 6,962,633 |
| (f) Tangible common equity divided by tangible assets. Tangible assets equals total assets less goodwill and other intangibles. | |||||
| RECONCILIATION OF TOTAL ASSETS TO TANGIBLE ASSETS: | |||||
| December 31, 2011 | September 30, 2011 | December 31, 2010 | |||
| TOTAL ASSETS | $ 6,974,845 | $ 7,095,097 | $ 7,282,261 | ||
| Less: Goodwill and other intangibles | 74,843 | 76,370 | 78,377 | ||
| TANGIBLE ASSETS | $ 6,900,002 | $ 7,018,727 | $ 7,203,884 | ||
| PARK NATIONAL CORPORATION | |||||
| Financial Highlights (continued) | |||||
| (g) Efficiency ratio is calculated by taking total other expense divided by the sum of fully taxable equivalent net interest income and other income. Fully taxable equivalent net interest income reconciliation is shown below assuming a 35% tax rate. Additionally, net interest margin is calculated on a fully taxable equivalent basis. | |||||
| RECONCILIATION OF FULLY TAXABLE EQUIVALENT NET INTEREST INCOME TO NET INTEREST INCOME | |||||
| THREE MONTHS ENDED | TWELVE MONTHS ENDED | ||||
| December 31, 2011 | September 30, 2011 | December 31, 2010 | December 31, 2011 | December 31, 2010 | |
| Interest income | $ 80,231 | $ 82,065 | $ 84,391 | $ 331,880 | $ 345,517 |
| Fully taxable equivalent adjustment | 456 | 474 | 540 | 1,938 | 2,047 |
| Fully taxable equivalent interest income | $ 80,687 | $ 82,539 | $ 84,931 | $ 333,818 | $ 347,564 |
| Interest expense | 13,952 | 14,445 | 15,893 | 58,646 | 71,473 |
| Fully taxable equivalent net interest income | $ 66,735 | $ 68,094 | $ 69,038 | $ 275,172 | $ 276,091 |
| PARK NATIONAL CORPORATION | ||||
| Consolidated Statements of Income | ||||
| Three Months Ended | Twelve Months Ended | |||
| December 31, | December 31, | |||
| (in thousands, except share and per share data) | 2011 | 2010 | 2011 | 2010 |
| (Restated) | (Restated) | |||
| Interest income: | ||||
| Interest and fees on loans | $ 65,497 | $ 67,405 | $ 262,458 | $ 267,692 |
| Interest on: | ||||
| Obligations of U.S. Government, its agencies | ||||
| and other securities | 14,571 | 16,768 | 68,873 | 76,839 |
| Obligations of states and political subdivisions | 61 | 173 | 371 | 786 |
| Other interest income | 102 | 45 | 178 | 200 |
| Total interest income | 80,231 | 84,391 | 331,880 | 345,517 |
| Interest expense: | ||||
| Interest on deposits: | ||||
| Demand and savings deposits | 894 | 1,133 | 3,812 | 5,753 |
| Time deposits | 5,247 | 7,512 | 23,842 | 36,212 |
| Interest on borrowings | 7,811 | 7,248 | 30,992 | 29,508 |
| Total interest expense | 13,952 | 15,893 | 58,646 | 71,473 |
| Net interest income | 66,279 | 68,498 | 273,234 | 274,044 |
| Provision for loan losses | 16,218 | 42,627 | 59,272 | 87,080 |
| Net interest income after provision for loan losses | 50,061 | 25,871 | 213,962 | 186,964 |
| Other income | 17,885 | 12,129 | 66,081 | 63,016 |
| Gain on sale of securities | 3,367 | 45 | 28,829 | 11,864 |
| Other expense: | ||||
| Salaries and employee benefits | 25,952 | 24,631 | 102,068 | 98,315 |
| Occupancy expense | 2,866 | 2,760 | 11,295 | 11,510 |
| Furniture and equipment expense | 2,643 | 2,615 | 10,773 | 10,435 |
| Other expense | 17,904 | 16,514 | 64,181 | 66,847 |
| Total other expense | 49,365 | 46,520 | 188,317 | 187,107 |
| Income (loss) before income taxes | 21,948 | (8,475) | 120,555 | 74,737 |
| Income taxes | 8,739 | (5,053) | 35,815 | 16,636 |
| Net income (loss) | $ 13,209 | $ (3,422) | $ 84,740 | $ 58,101 |
| Preferred stock dividends and accretion | 1,464 | 1,452 | 5,856 | 5,807 |
| Net income (loss) available to common shareholders | $ 11,745 | $ (4,874) | $ 78,884 | $ 52,294 |
| Per Common Share: | ||||
| Net income (loss) - basic | $ 0.76 | $ (0.32) | $ 5.12 | $ 3.45 |
| Net income (loss) - diluted | $ 0.76 | $ (0.32) | $ 5.12 | $ 3.45 |
| Weighted average shares - basic | 15,403,861 | 15,340,427 | 15,400,155 | 15,152,692 |
| Weighted average shares - diluted | 15,403,861 | 15,352,600 | 15,401,446 | 15,155,735 |
| PARK NATIONAL CORPORATION | ||
| Consolidated Balance Sheets | ||
| (in thousands, except share data) | December 31, 2011 | December 31, 2010 |
| (Restated) | ||
| Assets | ||
| Cash and due from banks | $ 140,549 | $ 109,058 |
| Money market instruments | 19,716 | 24,722 |
| Investment securities | 1,708,473 | 2,039,791 |
| Loans | 4,317,099 | 4,732,685 |
| Allowance for loan losses | 64,444 | 143,576 |
| Loans, net | 4,252,655 | 4,589,109 |
| Bank premises and equipment, net | 53,741 | 69,567 |
| Goodwill and other intangibles | 74,843 | 78,377 |
| Other real estate owned | 42,272 | 41,709 |
| Other assets | 302,913 | 329,928 |
| Assets held for sale | 379,683 | -- |
| Total assets | $ 6,974,845 | $ 7,282,261 |
| Liabilities and Stockholders' Equity | ||
| Deposits: | ||
| Noninterest bearing | $ 995,733 | $ 937,719 |
| Interest bearing | 3,469,381 | 4,157,701 |
| Total deposits | 4,465,114 | 5,095,420 |
| Borrowings | 1,162,026 | 1,375,652 |
| Other liabilities | 66,555 | 81,481 |
| Liabilities held for sale | 536,186 | -- |
| Total liabilities | $ 6,229,881 | $ 6,552,553 |
| Stockholders' Equity: | ||
| Preferred Stock (200,000 shares authorized in 2011 and 2010; | ||
| 100,000 shares issued in 2011 and 2010) | $ 98,146 | $ 97,290 |
| Common stock (No par value; 20,000,000 shares authorized | ||
| in 2011 and 2010; 16,151,021 shares issued at December 31, 2011, | ||
| and 16,151,062 at December 31, 2010) | 301,202 | 301,204 |
| Common stock warrants | 4,297 | 4,473 |
| Accumulated other comprehensive loss, net of taxes | (8,831) | (1,868) |
| Retained earnings | 427,157 | 406,342 |
| Treasury stock (745,109 shares at December 31, 2011, | ||
| and 752,128 shares at December 31, 2010) | (77,007) | (77,733) |
| Total stockholders' equity | $ 744,964 | $ 729,708 |
| Total liabilities and stockholders' equity | $ 6,974,845 | $ 7,282,261 |
| PARK NATIONAL CORPORATION | ||||
| Consolidated Average Balance Sheets | ||||
| Three Months Ended | Twelve Months Ended | |||
| December 30, | December 30, | |||
| (in thousands) | 2011 | 2010 | 2011 | 2010 |
| (Restated) | (Restated) | |||
| Assets | ||||
| Cash and due from banks | $ 126,234 | $ 119,982 | $ 124,649 | $ 116,961 |
| Money market instruments | 163,804 | 84,379 | 78,593 | 93,009 |
| Investment securities | 1,668,827 | 1,707,321 | 1,868,343 | 1,792,786 |
| Loans | 4,676,229 | 4,695,257 | 4,713,511 | 4,642,478 |
| Allowance for loan losses | 98,887 | 118,342 | 128,512 | 119,700 |
| Loans, net | 4,577,342 | 4,576,915 | 4,584,999 | 4,522,778 |
| Bank premises and equipment, net | 69,054 | 70,299 | 69,507 | 69,839 |
| Goodwill and other intangibles | 76,041 | 78,823 | 77,055 | 80,072 |
| Other real estate owned | 43,226 | 53,395 | 44,815 | 47,400 |
| Other assets | 367,937 | 322,563 | 358,210 | 319,860 |
| Total assets | $ 7,092,465 | $ 7,013,677 | $ 7,206,171 | $ 7,042,705 |
| Liabilities and Stockholders' Equity | ||||
| Deposits: | ||||
| Noninterest bearing | $ 1,047,491 | $ 959,685 | $ 999,085 | 907,514 |
| Interest bearing | 4,037,485 | 4,161,547 | 4,193,404 | 4,274,501 |
| Total deposits | 5,084,976 | 5,121,232 | 5,192,489 | 5,182,015 |
| Borrowings | 1,155,566 | 1,041,920 | 1,179,458 | 1,026,295 |
| Other liabilities | 97,727 | 90,144 | 90,351 | 87,885 |
| Total liabilities | $ 6,338,269 | $ 6,253,296 | $ 6,462,298 | $ 6,296,195 |
| Stockholders' Equity: | ||||
| Preferred stock | $ 98,023 | $ 97,174 | $ 97,704 | $ 96,873 |
| Common stock | 301,203 | 301,317 | 301,203 | 301,244 |
| Common stock warrants | 4,382 | 4,405 | 4,429 | 4,822 |
| Accumulated other comprehensive income (loss), net of taxes | (3,127) | 11,169 | (4,201) | 15,478 |
| Retained earnings | 430,935 | 430,403 | 422,341 | 428,978 |
| Treasury stock | (77,220) | (84,087) | (77,603) | (100,885) |
| Total stockholders' equity | $ 754,196 | $ 760,381 | $ 743,873 | $ 746,510 |
| Total liabilities and stockholders' equity | $ 7,092,465 | $ 7,013,677 | $ 7,206,171 | $ 7,042,705 |
| PARK NATIONAL CORPORATION | |||||
| Consolidated Statements of Income - Linked Quarters | |||||
| 2011 | 2011 | 2011 | 2011 | 2010 | |
| (in thousands, except per share data) | 4th QTR | 3rd QTR | 2nd QTR | 1st QTR | 4th QTR |
| (Restated) | (Restated) | (Restated) | (Restated) | ||
| Interest income: | |||||
| Interest and fees on loans | $ 65,497 | $ 65,645 | $ 65,862 | $ 65,454 | $ 67,405 |
| Interest on: | |||||
| Obligations of U.S. Government, its agencies | |||||
| and other securities | 14,571 | 16,289 | 18,960 | 19,053 | 16,768 |
| Obligations of states and political subdivisions | 61 | 69 | 92 | 149 | 173 |
| Other interest income | 102 | 62 | 8 | 6 | 45 |
| Total interest income | 80,231 | 82,065 | 84,922 | 84,662 | 84,391 |
| Interest expense: | |||||
| Interest on deposits: | |||||
| Demand and savings deposits | 894 | 976 | 951 | 991 | 1,133 |
| Time deposits | 5,247 | 5,661 | 6,200 | 6,734 | 7,512 |
| Interest on borrowings | 7,811 | 7,808 | 7,749 | 7,624 | 7,248 |
| Total interest expense | 13,952 | 14,445 | 14,900 | 15,349 | 15,893 |
| Net interest income | 66,279 | 67,620 | 70,022 | 69,313 | 68,498 |
| Provision for loan losses | 16,218 | 16,438 | 12,516 | 14,100 | 42,627 |
| Net interest income after provision for loan losses | 50,061 | 51,182 | 57,506 | 55,213 | 25,871 |
| Other income | 17,885 | 18,027 | 15,139 | 15,030 | 12,129 |
| Gain on sale of securities | 3,367 | 3,465 | 15,362 | 6,635 | 45 |
| Other expense: | |||||
| Salaries and employee benefits | 25,952 | 25,799 | 25,253 | 25,064 | 24,631 |
| Occupancy expense | 2,866 | 2,665 | 2,764 | 3,000 | 2,760 |
| Furniture and equipment expense | 2,643 | 2,688 | 2,785 | 2,657 | 2,615 |
| Other expense | 17,904 | 14,447 | 16,205 | 15,625 | 16,514 |
| Total other expense | 49,365 | 45,599 | 47,007 | 46,346 | 46,520 |
| Income (loss) before income taxes | 21,948 | 27,075 | 41,000 | 30,532 | (8,475) |
| Income taxes | 8,739 | 6,694 | 12,046 | 8,336 | (5,053) |
| Net income (loss) | $ 13,209 | $ 20,381 | $ 28,954 | $ 22,196 | $ (3,422) |
| Preferred stock dividends and accretion | 1,464 | 1,464 | 1,464 | 1,464 | 1,452 |
| Net income (loss) available to common shareholders | $ 11,745 | $ 18,917 | $ 27,490 | $ 20,732 | $ (4,874) |
| Per Common Share: | |||||
| Net income (loss) - basic | $ 0.76 | $ 1.23 | $ 1.79 | $ 1.35 | $ (0.32) |
| Net income (loss) - diluted | $ 0.76 | $ 1.23 | $ 1.79 | $ 1.35 | $ (0.32) |
| PARK NATIONAL CORPORATION | |||||
| Detail of other income and other expense - Linked Quarters | |||||
| 2011 | 2011 | 2011 | 2011 | 2010 | |
| (in thousands) | 4th QTR | 3rd QTR | 2nd QTR | 1st QTR | 4th QTR |
| (Restated) | (Restated) | (Restated) | (Restated) | ||
| Other income: | |||||
| Income from fiduciary activities | $ 3,699 | $ 3,615 | $ 3,929 | $ 3,722 | $ 3,609 |
| Service charges on deposits | 4,643 | 4,894 | 4,525 | 4,245 | 4,853 |
| Other service income | 2,484 | 3,087 | 2,734 | 2,301 | 3,449 |
| Checkcard fee income | 3,115 | 3,154 | 3,251 | 2,976 | 3,068 |
| Bank owned life insurance income | 1,403 | 1,229 | 1,228 | 1,229 | 1,195 |
| ATM fees | 641 | 726 | 682 | 654 | 655 |
| OREO devaluations | (1,742) | (588) | (3,354) | (2,535) | (8,587) |
| Other | 3,642 | 1,910 | 2,144 | 2,438 | 3,887 |
| Total other income | $ 17,885 | $ 18,027 | $ 15,139 | $ 15,030 | $ 12,129 |
| Other expense: | |||||
| Salaries and employee benefits | $ 25,952 | $ 25,799 | $ 25,253 | $ 25,064 | $ 24,631 |
| Net occupancy expense | 2,866 | 2,665 | 2,764 | 3,000 | 2,760 |
| Furniture and equipment expense | 2,643 | 2,688 | 2,785 | 2,657 | 2,615 |
| Data processing fees | 1,393 | 1,184 | 1,135 | 1,253 | 1,339 |
| Professional fees and services | 5,920 | 5,005 | 5,320 | 4,874 | 5,341 |
| Amortization of intangibles | 1,528 | 669 | 669 | 669 | 822 |
| Marketing | 852 | 764 | 728 | 623 | 968 |
| Insurance | 1,526 | 681 | 2,345 | 2,269 | 2,136 |
| Communication | 1,544 | 1,475 | 1,485 | 1,556 | 1,536 |
| Other | 5,141 | 4,669 | 4,523 | 4,381 | 4,372 |
| Total other expense | $ 49,365 | $ 45,599 | $ 47,007 | $ 46,346 | $ 46,520 |
| PARK NATIONAL CORPORATION | ||||
| Asset Quality Information | ||||
| Year ended December 31, | ||||
| (in thousands, except ratios) | 2011 | 2010 | 2009 | 2008 |
| (Restated) | ||||
| Allowance for loan losses: | ||||
| Allowance for loan losses, beginning of period | $ 143,575 | $ 116,717 | $ 100,088 | $ 87,102 |
| Transfer of loans at fair value | (219) | |||
| Transfer of allowance to held for sale | (13,100) | |||
| Charge-offs | 133,882 | 66,314 | 59,022 | 62,916 |
| Recoveries | 8,798 | 6,092 | 6,830 | 5,415 |
| Net charge-offs | 125,084 | 60,222 | 52,192 | 57,501 |
| Provision for loan losses | 59,272 | 87,080 | 68,821 | 70,487 |
| Allowance for loan losses, end of period | $ 64,444 | $ 143,575 | $ 116,717 | $ 100,088 |
| General reserve trends: | ||||
| Allowance for loan losses, end of period | $ 64,444 | $ 143,575 | $ 116,717 | $ 100,088 |
| Specific reserves | 11,935 | 66,904 | 36,721 | 8,875 |
| General reserves | $ 52,509 | $ 76,671 | $ 79,996 | $ 91,213 |
| Total loans | $ 4,317,099 | $ 4,732,685 | $ 4,640,432 | $ 4,491,337 |
| Impaired commercial loans | 187,938 | 250,933 | 201,143 | 141,343 |
| Non-impaired loans | $ 4,129,161 | $ 4,481,752 | $ 4,439,289 | $ 4,349,994 |
| Asset Quality Ratios: | ||||
| Net charge-offs as a % of average loans | 2.65% | 1.30% | 1.14% | 1.32% |
| Allowance for loan losses as a % of period end loans | 1.49% | 3.03% | 2.52% | 2.23% |
| General reserves as a % of non-impaired loans | 1.27% | 1.71% | 1.80% | 2.10% |
| Nonperforming Assets - Park National Corporation: | ||||
| Nonaccrual loans | $ 190,652 | $ 289,268 | $ 233,544 | $ 159,512 |
| Accruing renegotiated loans | 33,923 | -- | 142 | 2,845 |
| Loans past due 90 days or more | 3,489 | 3,590 | 14,773 | 5,421 |
| Total nonperforming loans | $ 228,064 | $ 292,858 | $ 248,459 | $ 167,778 |
| Other real estate owned - Park National Bank | 13,240 | 8,385 | 6,037 | 6,149 |
| Other real estate owned - Parent Company | 29,032 | -- | -- | -- |
| Other real estate owned - Vision Bank | -- | 33,324 | 35,203 | 19,699 |
| Total nonperforming assets | $ 270,336 | $ 334,567 | $ 289,699 | $ 193,626 |
| Percentage of nonperforming loans to period end loans | 5.28% | 6.19% | 5.35% | 3.74% |
| Percentage of nonperforming assets to period end loans | 6.26% | 7.07% | 6.24% | 4.31% |
| Percentage of nonperforming assets to period end assets | 3.88% | 4.59% | 4.11% | 2.74% |
| Nonperforming Assets - Ohio-based operations: | ||||
| Nonaccrual loans | $ 96,113 | $ 117,815 | $ 85,197 | $ 68,306 |
| Accruing renegotiated loans | 26,342 | -- | 142 | -- |
| Loans past due 90 days or more | 3,367 | 3,226 | 3,496 | 4,777 |
| Total nonperforming loans | $ 125,822 | $ 121,041 | $ 88,835 | $ 73,083 |
| Other real estate owned - Park National Bank | 13,240 | 8,385 | 6,037 | 6,149 |
| Other real estate owned - Parent Company | 29,032 | -- | -- | -- |
| Total nonperforming assets | $ 168,094 | $ 129,426 | $ 94,872 | $ 79,232 |
| Percentage of nonperforming loans to period end loans | 3.00% | 2.96% | 2.24% | 1.92% |
| Percentage of nonperforming assets to period end loans | 4.01% | 3.16% | 2.39% | 2.08% |
| Percentage of nonperforming assets to period end assets | 2.64% | 1.99% | 1.54% | 1.29% |
| Nonperforming Assets - Vision Bank (retained portfolio): | ||||
| Nonaccrual loans | $ 94,539 | $ 171,453 | $ 148,347 | $ 91,206 |
| Accruing renegotiated loans | 3,157 | -- | -- | 2,845 |
| Loans past due 90 days or more | 122 | 364 | 11,277 | 644 |
| Total nonperforming loans | $ 97,818 | $ 171,817 | $ 159,624 | $ 94,695 |
| Other real estate owned | -- | 33,324 | 35,203 | 19,699 |
| Total nonperforming assets | $ 97,818 | $ 205,141 | $ 194,827 | $ 114,394 |
| Percentage of nonperforming loans to period end loans | 82.53% | 26.82% | 23.58% | 13.71% |
| Percentage of nonperforming assets to period end loans | 82.53% | 32.02% | 28.78% | 16.57% |
| Percentage of nonperforming assets to period end assets | 37.33% | 25.90% | 21.70% | 12.47% |
| New nonaccrual loan information: | ||||
| Nonaccrual loans, beginning of period | $ 289,268 | $ 233,544 | $ 159,512 | $ 101,128 |
| New nonaccrual loans - Ohio-based operations | 78,316 | 85,081 | 57,641 | 58,161 |
| New nonaccrual loans - Vision Bank | 41,388 | 90,094 | 126,540 | 83,588 |
| Resolved nonaccrual loans | 218,320 | 119,451 | 110,149 | 83,365 |
| Nonaccrual loans, end of period | $ 190,652 | $ 289,268 | $ 233,544 | $ 159,512 |
| Impaired Commercial Loan Portfolio Information (period end): | ||||
| Unpaid principal balance | $ 291,771 | $ 304,534 | $ 245,092 | $ 171,310 |
| Prior charge-offs | 103,833 | 53,601 | 43,949 | 29,967 |
| Remaining principal balance | 187,938 | 250,933 | 201,143 | 141,343 |
| Specific reserves | 11,935 | 66,904 | 36,721 | 8,875 |
| Book value, after specific reserve | $ 176,003 | $ 184,029 | $ 164,422 | $ 132,468 |