|
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR
15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________
to _____________
Commission file number 0-6835
IRWIN FINANCIAL CORPORATION
(Exact name of registrant as specified
in its charter)
INDIANA
(State or other jurisdiction of
Incorporation or organization)
35-1286807
(IRS Employer Identification No.)
500 Washington Street, Columbus,
IN 47201
(Address or principal executive
offices)
(Zip Code)
812-376-1909
(Registrant's telephone number,
including area code)
(Former name, former address and
former fiscal year
if changed since last report)
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the
past 90 days.
Yes __ X __ No _____
APPLICABLE ONLY TO ISSUERS INVOLVED
IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING
FIVE YEARS
Indicate by check mark whether the registrant
has filed all documents and reports required to be filed by Sections 12,
13, or 15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
Yes _____ No _____
As of July 31, 2000 there were outstanding 20,979,683
common shares, no par value, of the Registrant.
Part I
Item 1
IRWIN FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET (Unaudited)
|
(In thousands, except for shares)
|
|
|
June 30,
|
December 31,
|
|
Assets:
|
|
|
|
|
2000
|
1999
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
|
|
$51,999
|
$47,215
|
|
Federal funds sold
|
|
|
|
10,000
|
0
|
|
Cash and cash equivalents
|
|
|
|
61,999
|
47,215
|
|
Interest-bearing deposits with financial institutions
|
|
34,595
|
26,785
|
|
Trading assets
|
|
|
|
|
96,094
|
59,025
|
|
Investment securities (Market value: $36,400
in 2000
and $37,464 in 1999) - Note 2
|
36,754
|
37,508
|
|
Loans held for sale - Note 3
|
|
|
|
543,673
|
508,997
|
|
Loans and leases, net of unearned income - Note 4
|
939,025
|
733,424
|
|
Less: Allowance for loan and lease losses - Note 5
|
(10,054)
|
(8,555)
|
|
|
|
|
|
|
928,971
|
724,869
|
|
Servicing assets - Note 6
|
|
|
|
139,876
|
138,500
|
|
Accounts receivable
|
|
|
|
54,016
|
49,415
|
|
Accrued interest receivable
|
|
|
|
12,488
|
8,430
|
|
Premises and equipment
|
|
|
|
27,540
|
23,368
|
|
Other assets
|
|
|
|
|
57,005
|
56,735
|
|
|
|
|
|
|
$1,993,011
|
$1,680,847
|
|
Liabilities and Shareholders' Equity:
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
|
Noninterest-bearing
|
|
|
|
$263,661
|
$218,402
|
|
Interest-bearing
|
|
|
|
487,017
|
411,400
|
|
Certificates of deposit over $100,000
|
|
479,821
|
240,516
|
|
|
|
|
|
|
1,230,499
|
870,318
|
|
Short-term borrowings- Note 7
|
|
|
|
410,971
|
473,103
|
|
Long-term debt- Note 8
|
|
|
|
29,585
|
29,784
|
|
Other liabilities
|
|
|
|
101,032
|
100,275
|
|
Total liabilities
|
|
|
|
1,772,087
|
1,473,480
|
|
|
|
|
|
|
|
|
|
Company-obligated mandatorily redeemable preferred securities
of subsidiary trust- Note 9
|
|
|
|
|
|
48,107
|
48,071
|
|
|
|
|
|
|
|
|
|
Shareholders' equity
|
|
|
|
|
|
|
Preferred stock, no par
value - authorized
4,000,000 shares; issued 96,336 shares as of June 30, 2000 and none
as of December 31, 1999
|
|
|
|
|
|
|
|
|
|
1,386
|
0
|
|
Common stock; no par value - authorized
40,000,000 shares; issued 23,402,080 shares as of June 30, 2000
and December 31, 1999; including 2,430,488 and 2,297,303 shares
in treasury as of June 30, 2000 and December 31, 1999 respectively
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29,965
|
29,965
|
|
Additional paid-in capital
|
|
|
|
4,334
|
4,250
|
|
Unrealized losses on investment securities
|
|
(105)
|
(70)
|
|
Retained earnings
|
|
|
|
185,570
|
171,101
|
|
|
|
|
|
|
221,150
|
205,246
|
|
Less treasury stock, at cost
|
|
|
|
(48,333)
|
(45,950)
|
|
Total shareholders' equity
|
|
|
|
172,817
|
159,296
|
|
|
|
|
|
|
$1,993,011
|
$1,680,847
|
The accompanying notes are an integral part of
the consolidated financial statements.
IRWIN FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
June 30,
|
|
(In thousands, except for per share)
|
|
2000
|
1999
|
|
Interest income:
|
|
|
|
|
|
|
Loans and leases
|
|
|
|
$19,322
|
$12,450
|
|
Investment securities:
|
|
|
|
|
|
|
Taxable
|
|
|
|
|
999
|
981
|
|
Tax-exempt
|
|
|
|
64
|
69
|
|
Loans held for sale
|
|
|
|
19,610
|
14,972
|
|
Trading Account
|
|
|
|
2,682
|
1,589
|
|
Federal funds sold
|
|
|
|
47
|
274
|
|
Total interest income
|
|
|
|
42,724
|
30,335
|
|
Interest expense:
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
11,550
|
5,755
|
|
Short-term borrowings
|
|
|
|
9,050
|
5,612
|
|
Long-term debt
|
|
|
|
580
|
1,186
|
|
Total interest expense
|
|
|
21,180
|
12,553
|
|
Net interest income
|
|
|
21,544
|
17,782
|
|
Provision for loan and lease losses - Note 5
|
1,119
|
2,330
|
|
Net interest income after provision for
|
|
|
|
|
loan and lease losses
|
|
|
|
20,425
|
15,452
|
|
Other income:
|
|
|
|
|
|
|
Loan origination fees
|
|
|
|
9,052
|
12,613
|
|
Gain from sales of loans
|
|
|
|
21,718
|
25,834
|
|
|
|
|
|
|
|
|
|
Loan servicing fees
|
|
|
14,802
|
15,943
|
|
Amortization and impairment of servicing assets
|
6,708
|
4,573
|
|
Net loan administration income
|
8,094
|
11,370
|
|
Gain on sale of mortgage servicing
|
|
5,471
|
478
|
|
Trading gains (losses)
|
|
|
|
4,902
|
(639)
|
|
Brokerage fees and commissions
|
|
497
|
411
|
|
Trust fees
|
|
|
|
683
|
544
|
|
Service charges on deposit accounts
|
|
472
|
445
|
|
Insurance commissions, fees and premiums
|
|
1,363
|
976
|
|
Other
|
|
|
|
|
627
|
1,444
|
|
|
|
|
|
|
52,879
|
53,476
|
|
Other expense:
|
|
|
|
|
|
|
Salaries
|
|
|
|
|
29,527
|
28,808
|
|
Pension and other employee benefits
|
|
5,256
|
4,511
|
|
Office expense
|
|
|
|
3,244
|
3,058
|
|
Premises and equipment
|
|
|
|
7,048
|
5,804
|
|
Marketing and development
|
|
3,934
|
2,337
|
|
Other
|
|
|
|
|
9,026
|
10,263
|
|
|
|
|
|
|
58,035
|
54,781
|
|
Income before income taxes
|
|
15,269
|
14,147
|
|
Provision for income taxes
|
|
5,590
|
5,360
|
|
|
|
|
|
|
9,679
|
8,787
|
|
Distribution on company-obligated mandatorily
|
|
|
|
redeemable preferred securities of subsidiary trust
|
1,174
|
1,174
|
|
Net income available to common shareholders
|
$8,505
|
$7,613
|
|
|
|
|
|
|
|
|
|
Earnings per share of common stock available to shareholders:
|
|
Basic - Note 10
|
|
|
|
$0.41
|
$0.35
|
|
Diluted - Note 10
|
|
|
|
$0.40
|
$0.35
|
|
Dividends per share of common stock
|
|
$0.06
|
$0.05
|
The accompanying notes are an integral part of
the consolidated financial statements.
IRWIN FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|
|
June 30,
|
|
(In thousands, except for per share)
|
|
2000
|
1999
|
|
Interest income:
|
|
|
|
|
|
|
Loans and leases
|
|
|
|
$39,532
|
$24,230
|
|
Investment securities:
|
|
|
|
|
|
|
Taxable
|
|
|
|
|
1,928
|
1,987
|
|
Tax-exempt
|
|
|
|
127
|
141
|
|
Loans held for sale
|
|
|
31,648
|
32,413
|
|
Trading Account
|
|
|
|
5,166
|
2,875
|
|
Federal funds sold
|
|
|
|
93
|
417
|
|
Total interest income
|
|
|
|
78,494
|
62,063
|
|
Interest expense:
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
20,010
|
11,420
|
|
Short-term borrowings
|
|
|
|
15,498
|
12,457
|
|
Long-term debt
|
|
|
|
1,163
|
2,478
|
|
Total interest expense
|
|
36,671
|
26,355
|
|
Net interest income
|
|
|
|
41,823
|
35,708
|
|
Provision for loan and lease losses - Note 5
|
2,254
|
3,531
|
|
Net interest income after provision for loan and
lease losses
|
|
|
|
39,569
|
32,177
|
|
Other income:
|
|
|
|
|
|
|
Loan origination fees
|
|
|
|
16,566
|
26,028
|
|
Gain from sales of loans
|
|
|
|
40,320
|
57,416
|
|
|
|
|
|
|
|
|
|
Loan servicing fees
|
|
|
|
29,923
|
31,375
|
|
Amortization and impairment of servicing assets
|
12,809
|
5,902
|
|
Net loan administration income
|
17,114
|
25,473
|
|
Gain on sale of mortgage servicing
|
5,723
|
2,829
|
|
Trading gains (losses)
|
|
|
|
8,291
|
(10,386)
|
|
Brokerage fees and commissions
|
|
1,032
|
763
|
|
Trust fees
|
|
|
|
1,165
|
1,120
|
|
Service charges on deposit accounts
|
912
|
847
|
|
Insurance commissions, fees and premiums
|
2,555
|
1,402
|
|
Other
|
|
|
|
|
9,339
|
2,569
|
|
|
|
|
|
|
103,017
|
108,061
|
|
Other expense:
|
|
|
|
|
|
|
Salaries
|
|
|
|
|
55,482
|
57,407
|
|
Pension and other employee benefits
|
|
10,924
|
9,984
|
|
Office expense
|
|
|
|
6,513
|
6,415
|
|
Premises and equipment
|
|
|
|
13,105
|
11,472
|
|
Marketing and development
|
|
8,712
|
5,138
|
|
Other
|
|
|
|
|
17,236
|
19,413
|
|
|
|
|
|
|
111,972
|
109,829
|
|
Income before income taxes
|
|
30,614
|
30,409
|
|
Provision for income taxes
|
|
11,279
|
11,476
|
|
|
|
|
|
|
19,335
|
18,933
|
|
Distribution on company-obligated mandatorily
|
|
|
|
redeemable preferred securities of subsidiary trust
|
2,348
|
2,348
|
|
Net income available to common shareholders
|
$16,987
|
$16,585
|
|
|
|
|
|
|
|
|
|
Earnings per share of common stock available to shareholders:
|
|
Basic - Note 10
|
|
|
|
$0.81
|
$0.77
|
|
Diluted - Note 10
|
|
|
|
$0.80
|
$0.76
|
|
Dividends per share of common stock
|
|
$0.12
|
$0.10
|
The accompanying notes are an integral part of
the consolidated financial statements.
IRWIN FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS'
EQUITY
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
|
|
|
|
|
Unrealized
|
|
|
|
|
|
|
|
|
|
Gains/Losses
|
|
|
|
|
|
|
|
|
|
on
|
|
Additional
|
|
|
|
|
|
|
Retained
|
Investment
|
Common
|
Paid in
|
Treasury
|
Preferred
|
|
|
|
Total
|
Earnings
|
Securities
|
Stock
|
Capital
|
Stock
|
Stock
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
Balance at April 1, 2000
|
$165,256
|
$178,324
|
($112)
|
$29,965
|
$4,387
|
($48,695)
|
$1,387
|
|
Comprehensive Income: Note 1
|
|
|
|
|
|
|
|
Net Income
|
|
8,505
|
|
|
|
|
|
|
Other Comprehensive Income
|
|
|
7
|
|
|
|
|
|
Total
|
|
8,512
|
|
|
|
|
|
|
|
Cash dividends
|
(1,259)
|
(1,259)
|
|
|
|
|
|
|
Purchase of treasury stock
|
(332)
|
|
|
|
|
(332)
|
|
|
Sales of treasury stock
|
641
|
|
|
|
(53)
|
694
|
|
|
Preferred stock issued
|
(1)
|
|
|
|
|
|
(1)
|
|
Balance June 30, 2000
|
$172,817
|
$185,570
|
($105)
|
$29,965
|
$4,334
|
($48,333)
|
$1,386
|
|
|
|