Talmer Reports 2Q Net Income of $20.15 Million

TROY, Mich. – Talmer Bancorp Inc., holding company of Talmer Bank and Trust, Wednesday reported second-quarter net income of $20.15 million, or 28 cents per average common share.

This compares to first-quarter (revised) net income of $21.16 million, or 30 cents per share, and second-quarter 2015 net income of $17.55 million, or 23 cents per common share.

Because of its pending merger with Chemical Financial Corp., Midland, Mich., the holding company of Chemical Bank, Talmer said it would not hold a conference webcast to review its performance and its CEO, David T. Provost, did not offer a prepared statement. Shareholders of both companies have voted for the union and both are in a quiet period as they await the “receipt of regulatory approvals and satisfaction of other customary closing conditions.”

Key performance ratios for the quarters ended June 30, March 31, and June 30, 2015:

• Return on average assets (annualized), 1.19%, 1.27%, 1.11%.
• Return on average equity (annualized), 10.62%, 11.49%, 9.26%.
• Net interest margin (fully taxable equivalent), 3.73%, 3.73%, 3.50%.
• Efficiency ratio, 61.54%, 69.23%, 74.32%.

Talmer drew attention to:

• The increase of $125.2 million in net loans during the second quarter, “driven by strong growth in residential real estate and commercial real estate lending, partially offset by acquired loan run-off.”
• Total deposits increasing by $114.4 million to $5.267 billion during the quarter from $5.153 billion the quarter ended March 31 and $4.908 billion the year-ago quarter.
• An increase of $1.3 million in net interest income to $57.39 million, up from $56.4 million the first quarter and $49.61 million the quarter ended Jun3 30, 2015.
• And an increase in noninterest income of $3.6 million to $17.24 million from the first quarter. Second-quarter 2015 noninterest income was $22.10 million.

Total loans rose to $5.048 billion from $4.924 billion the preceding quarter and $4.525 billion the year-ago quarter. Net total loans were $4.997 billion at June 30.

Commercial real estate made up $1.662 billion of the loan portfolio, residential real estate $1.675 billion, and commercial and industrial lending $1.283 billion.

Noninterest expense (salaries and benefits, rents, data processing, marketing, Federal Deposit Insurance Corp. premiums) was $45.93 million, down from $53.29 million the first quarter and $94.20 million the year-ago quarter. Contributing to the reduction was lower merger and acquisition expense, $312,000, down from $2.87 million the first quarter and $3.19 million a year ago.

Total nonperforming assets (includes loans more than 90 days past due) stood at $66.42 million at June 30, down from $79.53 million at March 31 and $105.39 million at June 30, 2015.

Repossessed real estate, usually called OREO or other real estate owned,” reflected the trend in declining nonperforming assets. The figure was $20.46 million at June 30, $26.43 million at March 31, and $105.39 million at Jun3 30, 2015.

Some $7.90 million in bad loans were charged off during the quarter compared to $5.05 million the first quarter and $7.94 million the year-ago quarter.

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