UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):
OCTOBER 29, 2003
FIRST MID-ILLINOIS BANCSHARES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION)
0-13368 37-1103704
(COMMISSION FILE NUMBER) (IRS EMPLOYER IDENTIFICATION NO.)
1515 CHARLESTON AVENUE, MATTOON, IL 61938
(ADDRESS INCLUDING ZIP CODE OF PRINCIPAL EXECUTIVE OFFICES)
(217) 234-7454
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
Item 5. Other Events
Incorporated by reference is the quarterly shareholder report issued by the
Registrant on October 29, 2003, attached as Exhibit 99, providing information
concerning the Registrant's financial statements as of September 30, 2003.
Item 7. Financial Statements and Exhibits
(c) Exhibits
Exhibit 99 - Quarterly shareholder report issued October 29, 2003
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has dully caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
FIRST MID-ILLINOIS BANCSHARES, INC.
Dated: October 29, 2003 By: /s/ William S. Rowland
William S. Rowland
President and Chief
Executive Officer
EXHIBIT INDEX
Exhibit
Number Description
99 Quarterly shareholder report issued October 29, 2003
Exhibit 99
October 29, 2003
Quarterly Report to the Owners,
First Mid-Illinois Bancshares, Inc.
Our financial results for the first nine months of 2003 were good, with diluted
earnings per share amounting to $2.14 per share. This amount represents a 21%
increase from the $1.77 per share we earned during the same period in 2002.
Total net income during the first nine months of 2003 was $6,877,000,
representing a 14% increase from the $6,046,000 we earned during the same period
in 2002. Earnings per share increased faster than net income because of our
share buy-back program. Year-to-date in 2003, we have acquired 103,419 shares at
a total investment of $3,466,000. This program has proven to be an effective way
of increasing value for shareholders. Any shareholder who wishes to use this
service should contact Mrs. Christie Wright at (217) 258-0493.
Higher non-interest income was the primary factor in the earnings growth.
Non-interest income increased to $9,913,000 for the first nine months of 2003 as
compared to $7,727,000 for the same period in 2002. Residential real estate
activity has continued to be strong throughout our franchise area, with mortgage
banking revenue increasing to $1,755,000 for the first nine months of 2003 from
$1,054,000 for the same period in 2002. Most of the residential real estate
loans we originate are sold into the secondary market for interest rate risk
management purposes. In addition, growth in deposit service charges due to
increases in deposit balances and overdraft fees, and increased insurance
commissions also contributed to the non-interest income increase.
Net interest income declined slightly for the first nine months, amounting to
$19,965,000 in 2003 as compared to $20,001,000 in 2002. Loan pricing constraints
together with an extremely low interest rate environment resulted in a decline
in our net interest margin from 4.18% in the first nine months of 2002 to 3.81%
for the first nine months of 2003. We have been able to offset the margin
compression by increasing our loan volumes. Loan balances have increased by $40
million since December 31, 2002, with the growth primarily in commercial real
estate loans.
Our provision for loan losses amounted to $750,000 for the first nine months of
2003 as compared to $775,000 during the same period last year, with net
charge-offs declining to $205,000 for the first nine months of 2003 as compared
with $578,000 for the same period in 2002. Non-performing loans on September 30,
2003 were $4,766,000 as compared with $3,149,000 on December 31, 2002.
Non-interest expenses of $18,674,000 increased by $769,000 for the first nine
months of 2003 when compared to the same period in 2002 primarily as a result of
the increased costs associated with the locations in Champaign and Maryville
that were opened in November, 2002. Both branches have had solid loan and
deposit growth and are now adding to our profitability.
Thank you for your support and for your confidence in First Mid-Illinois
Bancshares, Inc.
Sincerely,
/s/ William S. Rowland
William S. Rowland
Chairman and Chief Executive Officer
Condensed Consolidated Balance Sheets
(In thousands, except share data) (unaudited) September 30, December 31,
2003 2002
------------------ -----------------
Assets
Cash and due from banks $ 23,887 $ 22,437
Federal funds sold and other interest-bearing deposits 15,750 47,220
Investment securities:
Available-for-sale, at fair value 167,055 166,415
Held-to-maturity, at amortized cost (estimated fair
value of $1,714 and $1,927 at September 30, 2003
and December 31, 2002, respectively) 1,692 1,902
Loans 539,743 499,864
Less allowance for loan losses (4,269) (3,723)
Net loans 535,474 496,141
remises and equipment, net 16,307 16,916
Goodwill, net 9,034 9,034
Intangible assets, net 4,166 4,743
Other assets 10,493 11,432
------------------ -----------------
Total assets $783,858 $776,240
================== =================
Liabilities and Stockholders' Equity
Deposits:
Non-interest bearing $ 90,545 $ 84,025
Interest bearing 524,234 529,427
------------------ -----------------
Total deposits 614,779 613,452
Repurchase agreements with customers 53,333 44,184
Other borrowings 39,925 44,625
Other liabilities 5,520 7,172
------------------ -----------------
Total liabilities $713,557 $709,433
------------------ -----------------
Stockholders' Equity:
Common stock ($4 par value; authorized 6,000,000 shares;
Issued 3,663,610 shares in 2003 and 3,603,737 shares in 2002) $14,655 $14,415
Additional paid-in capital 15,790 14,450
Retained earnings 51,982 45,896
Deferred compensation 1,833 1,589
Accumulated other comprehensive income 1,667 2,373
Treasury stock at cost, 517,981 shares in 2003 and 414,562 shares in 2002 (15,626) (11,916)
------------------ -----------------
Total stockholders' equity 70,301 66,807
------------------ -----------------
Total liabilities and stockholders' equity $783,858 $776,240
================== =================
Condensed Consolidated Statements of Income
(In thousands) (unaudited)
For the nine months ended September 30, 2003 2002
------------------ -----------------
Interest income:
Interest and fees on loans $ 24,245 $ 25,317
Interest on investment securities 4,649 5,578
Interest on federal funds sold and other 222 174
------------------ -----------------
Total interest income 29,116 31,069
Interest expense:
nterest on deposits 7,549 9,255
Interest on repurchase agreements with customers 193 257
Interest on other borrowings 1,409 1,556
------------------ -----------------
Total interest expense 9,151 11,068
------------------ -----------------
Net interest income 19,965 20,001
Provision for loan losses 750 775
------------------ -----------------
Net interest income after provision for loan losses 19,215 19,226
Non-interest income:
Trust revenues 1,444 1,398
Brokerage commissions 209 195
Insurance commissions 1,141 901
Service charges 3,303 2,609
Securities gains, net 370 223
Mortgage banking revenues 1,755 1,054
Other 1,691 1,347
------------------ -----------------
Total non-interest income 9,913 7,727
Non-interest expense:
Salaries and employee benefits 10,197 9,344
Net occupancy and equipment expense 3,202 3,023
Amortization of intangible assets 577 557
Other 4,698 4,981
------------------ -----------------
Total non-interest expense 18,674 17,905
------------------ -----------------
Income before income taxes 10,454 9,048
Income taxes 3,577 3,002
------------------ -----------------
Net income $ 6,877 $ 6,046
================== =================
Condensed Consolidated Statements of Changes in Stockholders' Equity
(in thousands) (unaudited)
For the nine month period ended September 30, 2003 2002
------------------ -----------------
Balance at beginning of period $ 66,807 $ 63,925
Net income 6,877 6,046
Dividends on stock (791) (780)
Issuance of stock 1,580 1,346
Purchase of treasury stock (3,466) (859)
Change in accumulated other comprehensive income (loss) (706) 1,896
------------------ -----------------
Balance at end of period $ 70,301 $ 71,574
================== =================
Per Share Information
(unaudited)
For the nine months ended September 30, 2003 2002
------------------ -----------------
Basic earnings per share $ 2.17 $ 1.78
Diluted earnings per share $ 2.14 $ 1.77
Book value per share $22.35 $21.09
First Mid-Illinois Bancshares, Inc.
1515 Charleston Avenue
Mattoon, Illinois 61938
(217) 234-7454
www.firstmid.com