Maryland
|
52-1380770
|
(State
or other jurisdiction
|
(I.R.S.
Employer Identification Number)
|
incorporation
or organization)
|
|
19
South Second Street, Oakland, Maryland
|
21550-0009
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Business
|
3
|
|
Risk
Factors
|
10
|
|
Unresolved
Staff Comments
|
14
|
|
Properties
|
14
|
|
Legal
Proceedings
|
14
|
|
Submission
Of Matters to a Vote of Security Holders
|
14
|
|
PART
II
|
||
Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
|
15
|
|
Selected
Financial Data
|
16
|
|
Management’s
Discussion and Analysis of Financial Condition and Resultsof
Operations
|
17
|
|
Quantitative
and Qualitative Disclosures About Market Risk
|
35
|
|
Financial Statements & Supplementary Data | 36 | |
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
|
59
|
|
Controls
and Procedures
|
59
|
|
Other
Information
|
62
|
|
PART
III
|
||
Directors
and Executive Officers of the Registrant
|
62
|
|
Executive
Compensation
|
62
|
|
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
|
62
|
|
Certain
Relationships and Related Transactions
|
62
|
|
Principal
Accounting Fees and Services
|
62
|
|
PART
IV
|
||
Exhibits
and Financial Statement Schedules
|
62
|
|
63
|
||
64
|
Offices
(in
Market)
|
Deposits
(in thousands)
|
Market
Share
|
||||||||
Allegany
County, Maryland:
|
||||||||||
Susquehanna
Bank
|
6
|
$
|
205,851
|
33.34
|
%
|
|||||
Manufacturers
& Traders Trust Company
|
7
|
196,870
|
31.89
|
%
|
||||||
First
United Bank & Trust
|
5
|
132,778
|
21.51
|
%
|
||||||
Farmers
& Mechanics Bank
|
3
|
55,301
|
8.96
|
%
|
||||||
Hoblitzell
National Bank of Hyndman
|
2
|
26,539
|
4.30
|
%
|
Frederick
County, Maryland:
|
||||||||||
Farmers
& Mechanics Bank
|
19
|
1,109,266
|
37.76
|
%
|
||||||
Branch
Banking & Trust Co.
|
12
|
554,497
|
18.88
|
%
|
||||||
Bank
of America NA
|
6
|
257,611
|
8.77
|
%
|
||||||
Manufacturers
& Traders Trust Co.
|
6
|
186,481
|
6.35
|
%
|
||||||
Frederick
County Bank
|
2
|
174,472
|
5.94
|
%
|
||||||
Woodsboro
Bank
|
7
|
145,712
|
4.96
|
%
|
||||||
Middletown
Valley Bank
|
4
|
117,968
|
4.02
|
%
|
||||||
SunTrust
Bank
|
3
|
105,697
|
3.60
|
%
|
||||||
Chevy
Chase Bank FSB
|
4
|
95,955
|
3.27
|
%
|
||||||
First
United Bank & Trust
|
3
|
93,872
|
3.20
|
%
|
||||||
Sandy
Spring Bank
|
3
|
41,433
|
1.41
|
%
|
||||||
Provident
Bank of Maryland
|
2
|
29,839
|
1.02
|
%
|
||||||
Damascus
Community Bank
|
2
|
15,185
|
0.52
|
%
|
||||||
Sovereign
Bank
|
1
|
7,947
|
0.27
|
%
|
||||||
Hagerstown
Trust Co.
|
1
|
1,560
|
0.05
|
%
|
Garrett
County, Maryland:
|
||||||||||
First
United Bank & Trust
|
5
|
432,572
|
71.12
|
%
|
||||||
Manufacturers
& Traders Trust Co.
|
5
|
107,469
|
17.67
|
%
|
||||||
Susquehanna
Bank
|
2
|
45,978
|
7.56
|
%
|
||||||
Terra
Alta Bank
|
1
|
17,958
|
2.95
|
%
|
||||||
Miners
& Merchants Bank
|
1
|
4,257
|
0.70
|
%
|
Washington
County, Maryland:
|
||||||||||
Susquehanna
Bank
|
10
|
446,175
|
26.06
|
%
|
||||||
Hagerstown
Trust Co.
|
11
|
390,608
|
22.82
|
%
|
||||||
Manufacturers
& Traders Trust Company
|
12
|
381,045
|
22.26
|
%
|
||||||
Sovereign
Bank
|
4
|
178,850
|
10.45
|
%
|
||||||
Farmers
& Mechanics Bank
|
6
|
175,321
|
10.24
|
%
|
||||||
First
United Bank & Trust
|
2
|
50,020
|
2.92
|
%
|
||||||
First
National Bank of McConnellsburg
|
2
|
33,277
|
1.94
|
%
|
||||||
Chevy
Chase Bank FSB
|
1
|
25,154
|
1.47
|
%
|
||||||
Citizens
National Bank of Berkeley Springs
|
1
|
17,344
|
1.01
|
%
|
||||||
First
National Bank of Greencastle
|
1
|
14,097
|
0.82
|
%
|
Berkeley
County, West Virginia:
|
||||||||||
Branch
Banking & Trust Co.
|
5
|
293,174
|
33.17
|
%
|
||||||
Centra
Bank Inc.
|
3
|
143,907
|
16.28
|
%
|
||||||
First
United Bank & Trust
|
5
|
127,712
|
14.45
|
%
|
||||||
City
National Bank of West Virginia
|
4
|
100,720
|
11.40
|
%
|
||||||
Susquehanna
Bank
|
4
|
84,278
|
9.54
|
%
|
||||||
Jefferson
Security Bank
|
2
|
59,107
|
6.69
|
%
|
||||||
Citizens
National Bank of Berkeley Springs
|
3
|
49,367
|
5.59
|
%
|
||||||
Bank
of Charles Town
|
2
|
25,546
|
2.89
|
%
|
Hardy
County, West Virginia:
|
||||||||||
Summit
Community Bank, Inc.
|
2
|
148,172
|
51.04
|
%
|
||||||
Capon
Valley Bank
|
3
|
101,227
|
34.87
|
%
|
||||||
Pendleton
County Bank
|
1
|
16,803
|
5.79
|
%
|
||||||
First
United Bank & Trust
|
1
|
16,756
|
5.77
|
%
|
||||||
Grant
County Bank
|
1
|
7,327
|
2.52
|
%
|
Mineral
County, West Virginia:
|
||||||||||
Branch
Banking & Trust Co.
|
3
|
70,753
|
33.97
|
%
|
||||||
First
United Bank & Trust
|
2
|
57,201
|
27.46
|
%
|
||||||
Manufacturers
& Traders Trust Co.
|
2
|
52,991
|
25.44
|
%
|
||||||
Grant
County Bank
|
1
|
27,343
|
13.13
|
%
|
Monongalia
County, West Virginia:
|
||||||||||
Huntington
National Bank
|
6
|
359,792
|
27.25
|
%
|
||||||
Branch
Banking & Trust Co.
|
5
|
306,550
|
23.22
|
%
|
||||||
Centra
Bank, Inc.
|
4
|
295,079
|
22.35
|
%
|
||||||
United
Bank
|
4
|
163,320
|
12.37
|
%
|
||||||
Wesbanco
Bank, Inc.
|
5
|
94,469
|
7.15
|
%
|
||||||
Bruceton
Bank
|
4
|
55,041
|
4.17
|
%
|
||||||
Citizens
Bank of Morgantown, Inc.
|
1
|
22,853
|
1.73
|
%
|
||||||
First
Exchange Bank
|
2
|
15,879
|
1.20
|
%
|
||||||
First
United Bank & Trust
|
1
|
7,429
|
0.56
|
%
|
2005
|
High
|
Low
|
Dividends
Declared
|
|||||||
1st
Quarter
|
$
|
21.70
|
$
|
19.81
|
$
|
.185
|
||||
2nd
Quarter.
|
20.30
|
18.94
|
.185
|
|||||||
3rd
Quarter
|
20.85
|
19.25
|
.185
|
|||||||
4th
Quarter
|
21.66
|
19.14
|
.190
|
|||||||
2004
|
High
|
|
|
Low
|
|
|
Dividends
Declared
|
|||
1st
Quarter
|
$
|
26.91
|
$
|
22.30
|
$
|
.180
|
||||
2nd
Quarter
|
24.96
|
19.25
|
.180
|
|||||||
3rd
Quarter
|
21.64
|
19.35
|
.180
|
|||||||
4th
Quarter
|
21.34
|
19.65
|
.185
|
FERRIS
BAKER WATTS
|
SCOTT
AND STRINGFELLOW, INC.
|
||
12
North Liberty St.
|
909
East Main Street
|
||
Cumberland,
MD 21502
|
Richmond,
VA 23219
|
||
(301)724-7161
|
(804)643-1811
|
||
(800)776-0629
|
(800)552-7757
|
||
113
S. Potomac St.
|
|||
Hagerstown,
MD 21740
|
|||
(301)733-7111
|
|||
(800)344-4413
|
(In
thousands, except per share data)
|
||||||||||||||||
2005
|
2004
|
2003
|
2002
|
2001
|
||||||||||||
Balance
Sheet Data
|
||||||||||||||||
Total
Assets
|
$
|
1,310,991
|
$
|
1,233,901
|
$
|
1,108,241
|
$
|
954,388
|
$
|
818,824
|
||||||
Net
Loans
|
954,545
|
904,635
|
786,051
|
659,758
|
603,801
|
|||||||||||
Investment
Securities
|
230,095
|
210,661
|
223,615
|
215,236
|
130,692
|
|||||||||||
Deposits
|
955,854
|
850,661
|
750,161
|
610,460
|
588,518
|
|||||||||||
Long-term
Borrowings
|
128,373
|
175,415
|
191,735
|
198,772
|
120,104
|
|||||||||||
Shareholders’
Equity
|
92,039
|
86,356
|
84,191
|
79,283
|
71,076
|
|||||||||||
Operating
Data
|
||||||||||||||||
Interest
Income
|
$
|
69,756
|
$
|
60,682
|
$
|
57,703
|
$
|
57,589
|
$
|
63,229
|
||||||
Interest
Expense
|
29,413
|
24,016
|
23,601
|
25,702
|
33,378
|
|||||||||||
Net
Interest Income
|
40,343
|
36,666
|
34,102
|
31,887
|
29,851
|
|||||||||||
Provision
for Loan Losses
|
1,078
|
2,534
|
833
|
1,506
|
2,926
|
|||||||||||
Other
Operating Income
|
13,978
|
12,971
|
11,867
|
9,007
|
9,314
|
|||||||||||
Other
Operating Expense
|
34,544
|
35,969
|
29,821
|
26,038
|
23,381
|
|||||||||||
Income
Before Tax
|
18,699
|
11,134
|
15,315
|
13,350
|
12,858
|
|||||||||||
Income
Tax
|
6,548
|
3,507
|
4,566
|
3,695
|
3,689
|
|||||||||||
Net
Income
|
$
|
12,151
|
$
|
7,627
|
$
|
10,749
|
$
|
9,655
|
$
|
9,169
|
||||||
Per
Share Data
|
||||||||||||||||
Net
Income
|
$
|
1.99
|
$
|
1.25
|
$
|
1.77
|
$
|
1.59
|
$
|
1.51
|
||||||
Dividends
Paid
|
.74
|
.72
|
.70
|
.68
|
.66
|
|||||||||||
Book
Value
|
15.04
|
14.17
|
13.83
|
13.04
|
11.69
|
|||||||||||
Significant
Ratios
|
||||||||||||||||
Return
on Average Assets
|
.95
|
%
|
.65
|
%
|
1.03
|
%
|
1.13
|
%
|
1.11
|
%
|
||||||
Return
on Average Equity
|
13.61
|
%
|
8.91
|
%
|
13.10
|
%
|
12.75
|
%
|
13.26
|
%
|
||||||
Dividend
Payout Ratio
|
37.19
|
%
|
57.48
|
%
|
39.65
|
%
|
42.76
|
%
|
43.71
|
%
|
||||||
Average
Equity to Average
|
||||||||||||||||
Assets
|
7.00
|
%
|
7.28
|
%
|
7.88
|
%
|
8.84
|
%
|
8.34
|
%
|
||||||
Total
Risk-based Capital
|
||||||||||||||||
Ratio
|
12.66
|
%
|
12.24
|
%
|
11.77
|
%
|
14.31
|
%
|
15.54
|
%
|
||||||
Tier
I Capital to Risk
|
||||||||||||||||
Weighted
Assets
|
11.47
|
%
|
10.81
|
%
|
11.04
|
%
|
13.76
|
%
|
14.67
|
%
|
||||||
Tier
I Capital to Average
|
||||||||||||||||
Assets
|
8.64
|
%
|
8.44
|
%
|
8.72
|
%
|
11.72
|
%
|
11.22
|
%
|
2005
|
|
2004
|
|
2003
|
||||||
Interest
income
|
$
|
70,533
|
$
|
61,380
|
58,558
|
|||||
Interest
expense
|
29,412
|
24,016
|
23,601
|
|||||||
Net
interest income
|
41,121
|
37,364
|
34,957
|
|||||||
Net
interest margin %
|
3.49
|
%
|
3.43
|
%
|
3.58
|
%
|
%
of Total Interest Income
|
||||||||||
2005
|
2004
|
2003
|
||||||||
Interest
and fees on loans
|
88
|
%
|
88
|
%
|
86
|
%
|
||||
Interest
on investment securities
|
12
|
%
|
12
|
%
|
14
|
%
|
For
the Years Ended December 31
|
||||||||||||||||||||||||||||
2005
|
2004
|
2003
|
||||||||||||||||||||||||||
AVERAGE
BALANCE
|
INTEREST
|
AVERAGE
YIELD/RATE
|
AVERAGE
BALANCE
|
INTEREST
|
AVERAGE
YIELD/RATE
|
AVERAGE
BALANCE
|
INTEREST
|
AVERAGE
YIELD/RATE
|
||||||||||||||||||||
Assets
|
||||||||||||||||||||||||||||
Loans
|
$
|
954,784
|
$
|
61,601
|
6.45
|
%
|
$
|
861,255
|
$
|
53,313
|
6.19
|
%
|
$
|
727,532
|
$
|
49,403
|
6.79
|
%
|
||||||||||
Investment
securities:
|
||||||||||||||||||||||||||||
Taxable
|
179,018
|
6,231
|
3.48
|
191,135
|
5,819
|
3.04
|
196,175
|
6,484
|
3.30
|
|||||||||||||||||||
Non
taxable
|
30,041
|
2,129
|
7.09
|
23,311
|
1,854
|
7.95
|
30,355
|
2,195
|
7.23
|
|||||||||||||||||||
Total
|
209,059
|
8,360
|
4.00
|
214,446
|
7,673
|
3.58
|
226,530
|
8,679
|
3.83
|
|||||||||||||||||||
Federal
funds sold
|
1,876
|
55
|
2.93
|
2,043
|
35
|
1.71
|
4,204
|
39
|
.93
|
|||||||||||||||||||
Interest-bearing
deposits
|
||||||||||||||||||||||||||||
with
other banks
|
5,327
|
162
|
3.04
|
3,583
|
56
|
1.57
|
8,967
|
101
|
1.13
|
|||||||||||||||||||
Other
interest earning Assets
|
8,680
|
355
|
4.09
|
8,439
|
303
|
3.59
|
8,818
|
336
|
3.81
|
|||||||||||||||||||
Total
earning assets
|
1,179,726
|
70,533
|
5.98
|
%
|
1,089,766
|
61,380
|
5.63
|
%
|
976,051
|
58,558
|
6.00
|
%
|
||||||||||||||||
Allowance
for loan
|
||||||||||||||||||||||||||||
Losses
|
(6,975
|
)
|
(6,150
|
)
|
(6,151
|
)
|
||||||||||||||||||||||
Non-earning
assets
|
102,500
|
94,730
|
71,473
|
|||||||||||||||||||||||||
Total
Assets
|
$
|
1,275,251
|
$
|
1,178,346
|
$
|
1,041,373
|
||||||||||||||||||||||
Liabilities
and
|
||||||||||||||||||||||||||||
Shareholders’
Equity
|
||||||||||||||||||||||||||||
Interest-bearing
|
||||||||||||||||||||||||||||
demand
deposits
|
$
|
293,129
|
$
|
4,895
|
1.67
|
%
|
$
|
279,217
|
$
|
2,699
|
.97
|
%
|
$
|
213,420
|
$
|
1,755
|
.82
|
%
|
||||||||||
Savings
deposits
|
58,964
|
242
|
.41
|
63,471
|
237
|
.37
|
53,753
|
218
|
.40
|
|||||||||||||||||||
Time
deposits:
|
||||||||||||||||||||||||||||
Less
than$100
|
264,503
|
6,023
|
2.28
|
209,708
|
4,950
|
2.36
|
219,817
|
7,002
|
3.19
|
|||||||||||||||||||
$100
or more
|
187,412
|
7,943
|
4.24
|
149,113
|
4,222
|
2.83
|
139,571
|
3,800
|
2.72
|
|||||||||||||||||||
Short-term
borrowings
|
100,601
|
2,749
|
2.73
|
82,747
|
1,153
|
1.39
|
55,006
|
447
|
.81
|
|||||||||||||||||||
Long-term
borrowings
|
159,748
|
7,560
|
4.73
|
205,193
|
10,755
|
5.23
|
190,984
|
10,379
|
5.43
|
|||||||||||||||||||
Total
interest-bearing
|
||||||||||||||||||||||||||||
liabilities
|
1,064,357
|
29,412
|
2.76
|
%
|
989,449
|
24,016
|
2.43
|
%
|
872,551
|
23,601
|
2.70
|
%
|
||||||||||||||||
Non-interest-bearing
|
||||||||||||||||||||||||||||
Deposits
|
112,860
|
94,871
|
75,840
|
|||||||||||||||||||||||||
Other
liabilities
|
8,734
|
8,266
|
10,954
|
|||||||||||||||||||||||||
Shareholders’
equity
|
89,300
|
85,760
|
82,028
|
|||||||||||||||||||||||||
Total
Liabilities and
|
||||||||||||||||||||||||||||
Shareholders’
Equity
|
$
|
1,275,251
|
$
|
1,178,346
|
$
|
1,041,373
|
||||||||||||||||||||||
Net
interest income and spread
|
41,121
|
3.22
|
%
|
37,364
|
3.20
|
%
|
34,957
|
3.30
|
%
|
|||||||||||||||||||
Net
interest margin
|
3.49
|
%
|
3.43
|
%
|
3.58
|
%
|
2005
Compared to 2004
|
2004
Compared to 2003
|
||||||||||||||||||
Volume
|
|
Rate
|
|
Net
|
|
Volume
|
|
Rate
|
|
Net
|
|||||||||
INTEREST
INCOME:
|
|||||||||||||||||||
Loans
|
$
|
6,034
|
$
|
2,253
|
$
|
8,287
|
$
|
8,278
|
$
|
(4,368
|
)
|
$
|
3,910
|
||||||
Taxable
investments
|
(422
|
)
|
833
|
411
|
(153
|
) |
(513
|
)
|
(666
|
)
|
|||||||||
Non-taxable
investments
|
477
|
(202
|
)
|
275
|
(560
|
)
|
220
|
(340
|
)
|
||||||||||
Federal
funds sold
|
(5
|
)
|
25
|
20
|
(37
|
)
|
33
|
(4
|
)
|
||||||||||
Other
interest earning assets
|
142
|
16
|
158
|
(297
|
)
|
219
|
(78
|
)
|
|||||||||||
Total
interest income
|
6,226
|
2,925
|
9,151
|
7,231
|
(4,409
|
)
|
2,822
|
||||||||||||
INTEREST
EXPENSE:
|
|||||||||||||||||||
Interest-bearing
|
|||||||||||||||||||
demand
deposits
|
232
|
1,964
|
2,196
|
636
|
308
|
944
|
|||||||||||||
Savings
deposits
|
(18
|
)
|
23
|
5
|
36
|
(18
|
)
|
18
|
|||||||||||
Time
deposits less
|
|||||||||||||||||||
than
$100
|
1,248
|
(175
|
)
|
1,073
|
(239
|
)
|
(1,812
|
)
|
(2,051
|
)
|
|||||||||
Time
deposits $100 or
|
|||||||||||||||||||
more
|
1,623
|
2,098
|
3,721
|
270
|
152
|
422
|
|||||||||||||
Short-term
borrowings
|
488
|
1,108
|
1,596
|
387
|
319
|
706
|
|||||||||||||
Long-term
borrowings
|
(2,151
|
)
|
(1,044
|
)
|
(3,195
|
)
|
745
|
(369
|
)
|
376
|
|||||||||
Total
interest expense
|
1,422
|
3,974
|
5,396
|
1,835
|
(1,420
|
)
|
415
|
||||||||||||
Net
interest income
|
$
|
4,804
|
$
|
(1,049
|
)
|
$
|
3,755
|
$
|
5,396
|
$
|
(2,989
|
)
|
$
|
2,407
|
(1)
|
The
change in interest income/expense due to both volume and rate has
been
allocated to volume and rate changes in proportion to the relationship
of
the absolute dollar amounts of the change in
each.
|
2005
VS. 2004
|
2004
VS. 2003
|
|||||||||||||||
2005
|
2004
|
2003
|
%
CHANGE
|
%CHANGE
|
||||||||||||
Service
charges on deposit accounts
|
$
|
4,260
|
$
|
3,824
|
$
|
3,175
|
11.4
|
%
|
20.4
|
%
|
||||||
Other
service charge income
|
1,203
|
925
|
720
|
30.0
|
%
|
28.5
|
%
|
|||||||||
Trust
department income
|
3,260
|
3,153
|
2,520
|
3.4
|
%
|
25.1
|
%
|
|||||||||
Brokerage
commission
|
613
|
720
|
701
|
(14.9
|
%)
|
2.7
|
%
|
|||||||||
Insurance
premium income
|
1,599
|
1,448
|
1,367
|
10.4
|
%
|
5.9
|
%
|
|||||||||
Security
gains (losses)
|
(125
|
)
|
703
|
1,009
|
*
|
(30.3
|
%)
|
|||||||||
Bank
owned life insurance (BOLI)
|
819
|
626
|
938
|
30.8
|
%
|
(33.3
|
%)
|
|||||||||
Gain
on prepayment of long term borrowings
|
868
|
—
|
—
|
—
|
—
|
|||||||||||
Other
income
|
1,591
|
1,572
|
1,437
|
1.2
|
%
|
9.3
|
%
|
|||||||||
Total
other operating income
|
$
|
14,088
|
$
|
12,971
|
$
|
11,867
|
8.6
|
%
|
9.3
|
%
|
2005
V. 2004
|
|
2004
V. 2003
|
||||||||||||||
2005
|
2004
|
2003
|
%
CHANGE
|
%CHANGE
|
||||||||||||
Salaries
and employee benefits
|
$
|
18,428
|
$
|
16,907
|
$
|
15,995
|
9.0
|
%
|
5.7
|
%
|
||||||
Other
expenses
|
9,676
|
10,360
|
8,853
|
(6.6
|
%)
|
17.0
|
%
|
|||||||||
Equipment
|
3,067
|
2,952
|
2,426
|
3.9
|
%
|
21.7
|
%
|
|||||||||
Expenses
related to early redemption of
|
||||||||||||||||
long-term
borrowings
|
437
|
2,728
|
—
|
(84.0
|
%)
|
—
|
||||||||||
Occupancy
|
1,642
|
1,642
|
1,330
|
—
|
23.4
|
%
|
||||||||||
Data
processing
|
1,404
|
1,380
|
1,217
|
1.7
|
%
|
13.4
|
%
|
|||||||||
Total
other operating expense
|
$
|
34,654
|
$
|
35,969
|
$
|
29,821
|
(3.7
|
%)
|
20.6
|
%
|
Year
End Percentage of Total Assets
|
||||||||||
2005
|
2004
|
2003
|
||||||||
Net
loans
|
73
|
%
|
73
|
%
|
71
|
%
|
||||
Investments
|
18
|
%
|
17
|
%
|
20
|
%
|
Year
End Percentage of Total Liabilities
|
||||||||||
|
2005
|
2004
|
2003
|
|||||||
Total
deposits
|
78
|
%
|
74
|
%
|
73
|
%
|
||||
Total
borrowings
|
20
|
%
|
25
|
%
|
26
|
%
|
Loans
Outstanding as of December 31
|
||||||||||||||||
2005
|
2004
|
2003
|
2002
|
2001
|
||||||||||||
Commercial
|
$
|
404,681
|
$
|
373,893
|
$
|
307,523
|
$
|
242,470
|
$
|
189,343
|
||||||
Residential—Mortgage
|
337,559
|
319,033
|
264,730
|
233,887
|
238,016
|
|||||||||||
Installment
|
193,275
|
199,862
|
201,419
|
173,578
|
164,297
|
|||||||||||
Residential—Construction
|
25,446
|
18,196
|
16,093
|
11,072
|
8,578
|
|||||||||||
Lease
Financing
|
—
|
466
|
2,260
|
4,819
|
9,319
|
|||||||||||
Total
Loans
|
$
|
960,961
|
$
|
911,450
|
$
|
792,025
|
$
|
665,826
|
$
|
609,553
|
Maturing
Within
One
Year
|
After
One
But
Within
Five
Years
|
Maturing
After
Five
Years
|
Total
|
||||||||||
Commercial
|
$
|
237,989
|
$
|
112,370
|
$
|
54,322
|
$
|
404,681
|
|||||
Residential—Mortgage
|
10,365
|
218,502
|
108,692
|
337,559
|
|||||||||
Installment
|
50,895
|
126,867
|
15,513
|
193,275
|
|||||||||
Residential—Construction
|
—
|
25,446
|
—
|
25,446
|
|||||||||
Total
Loans
|
$
|
299,249
|
$
|
483,185
|
$
|
178,527
|
$
|
960,961
|
|||||
Classified
by Sensitivity to Change in Interest Rates
|
|||||||||||||
Fixed-Interest
Rate Loans
|
$
|
64,941
|
$
|
149,630
|
$
|
98,909
|
$
|
313,480
|
|||||
Adjustable-Interest
Rate Loans
|
234,308
|
333,555
|
79,618
|
647,481
|
|||||||||
Total
Loans
|
$
|
299,249
|
$
|
483,185
|
$
|
178,527
|
$
|
960,961
|
For
the Years Ended December 31
|
|||||||||||||||||||
2005
|
|
2004
|
|
2003
|
|
2002
|
|
2001
|
|
2000
|
|
||||||||
Non-Accrual
Loans
|
$
|
2,393
|
$
|
3,439
|
$
|
2,774
|
$
|
1,847
|
$
|
3,196
|
$
|
1,066
|
|||||||
Accruing
Loans Past Due 90 Days or More
|
989
|
1,105
|
1,236
|
1,458
|
1,230
|
1,448
|
For
the Years Ended December 31
|
|||||||||||||||||||
2005
|
2004
|
2003
|
2002
|
2001
|
2000
|
||||||||||||||
Balance
at Beginning of Period
|
$
|
6,814
|
$
|
5,974
|
$
|
6,068
|
$
|
5,752
|
$
|
5,094
|
$
|
4,409
|
|||||||
Loans
Charged Off:
|
|||||||||||||||||||
Commercial
|
557
|
808
|
17
|
197
|
347
|
49
|
|||||||||||||
Residential—Mortgage
|
162
|
153
|
147
|
97
|
64
|
95
|
|||||||||||||
Installment
|
1,171
|
1,244
|
1,556
|
1,535
|
2,223
|
1,688
|
|||||||||||||
Total
Charged Off
|
1,890
|
2,205
|
1,720
|
1,829
|
2,634
|
1,832
|
|||||||||||||
Recoveries
of Loans:
|
|||||||||||||||||||
Commercial
|
8
|
22
|
50
|
229
|
21
|
10
|
|||||||||||||
Residential—Mortgage
|
59
|
67
|
17
|
9
|
7
|
21
|
|||||||||||||
Installment
|
347
|
422
|
425
|
401
|
338
|
288
|
|||||||||||||
Total
Recoveries
|
414
|
511
|
492
|
639
|
366
|
319
|
|||||||||||||
Net
Loans Charged Off
|
1,476
|
1,694
|
1,228
|
1,190
|
2,268
|
1,513
|
|||||||||||||
Provision
for Loan Losses
|
1,078
|
2,534
|
833
|
1,506
|
2,926
|
2,198
|
|||||||||||||
Huntington
Branch Acquisition
|
|||||||||||||||||||
Loan
Loss Reserve
|
—
|
—
|
301
|
—
|
—
|
—
|
|||||||||||||
Balance
at the End of Period
|
$
|
6,416
|
$
|
6,814
|
$
|
5,974
|
$
|
6,068
|
$
|
5,752
|
$
|
5,094
|
|||||||
Loans
at End of Period
|
$
|
960,961
|
$
|
911,450
|
$
|
792,025
|
$
|
665,826
|
$
|
609,553
|
$
|
617,069
|
|||||||
Daily
Average Balance of
|
|||||||||||||||||||
Loans
|
$
|
954,784
|
$
|
861,255
|
$
|
727,532
|
$
|
620,049
|
$
|
619,088
|
$
|
604,995
|
|||||||
Allowance
for Loan Losses
|
|||||||||||||||||||
to
Loans Outstanding
|
.67
|
%
|
.75
|
%
|
.75
|
%
|
.91
|
%
|
.94
|
%
|
.83
|
%
|
|||||||
Net
Charge Offs to Average
|
|||||||||||||||||||
Loans
Outstanding
|
.15
|
%
|
.20
|
%
|
.17
|
%
|
.19
|
%
|
.37
|
%
|
.25
|
%
|
2005
|
%
of Total Loans
|
2004
|
%
of Total Loans
|
2003
|
%
of Total Loans
|
2002
|
%
of Total Loans
|
2001
|
%
of Total Loans
|
||||||||||||||||||||||
Commercial
|
$
|
2,777
|
47
|
%
|
$
|
3,050
|
41
|
%
|
$
|
2,166
|
39
|
%
|
$
|
2,149
|
36
|
%
|
$
|
1,540
|
27
|
%
|
|||||||||||
Residential-Mortgage/
HEL/Construction
|
1,504
|
28
|
%
|
1,454
|
37
|
%
|
1,247
|
35
|
%
|
1,032
|
37
|
%
|
1,066
|
18
|
%
|
||||||||||||||||
Installment,
PCL & OakFirst
|
2,060
|
25
|
%
|
2,246
|
22
|
%
|
2,462
|
26
|
%
|
2,675
|
26
|
%
|
2,688
|
47
|
%
|
||||||||||||||||
Lease
Financing
|
—
|
—
|
15
|
—
|
52
|
—
|
105
|
1
|
%
|
91
|
2
|
%
|
|||||||||||||||||||
Commitments
|
75
|
—
|
49
|
—
|
47
|
—
|
33
|
—
|
29
|
—
|
|||||||||||||||||||||
Unallocated
|
—
|
—
|
—
|
—
|
—
|
74
|
—
|
338
|
6
|
%
|
|||||||||||||||||||||
Total
|
$
|
6,416
|
100
|
%
|
$
|
6,814
|
100
|
%
|
$
|
5,974
|
100
|
%
|
$
|
6,068
|
100
|
%
|
$
|
5,752
|
100
|
%
|
2005
|
As%
of
Total
|
2004
|
As%
of
Total
|
2003
|
As%
of
Total
|
||||||||||||||
Securities
Available-for-Sale:
|
|||||||||||||||||||
U.S.
Government and Agencies
|
$
|
107,019
|
47
|
%
|
$
|
102,294
|
48
|
%
|
$
|
75,701
|
34
|
%
|
|||||||
Mortgage-backed
Securities
|
63,938
|
28
|
%
|
74,386
|
35
|
%
|
89,082
|
40
|
%
|
||||||||||
Obligation
of States and
Political
Subdivisions
|
57,661
|
25
|
%
|
22,461
|
11
|
%
|
29,342
|
13
|
%
|
||||||||||
Corporate
and Other Debt
|
1,077
|
—
|
11,520
|
6
|
%
|
18,268
|
8
|
%
|
|||||||||||
Other
Securities
|
400
|
—
|
—
|
—
|
11,222
|
5
|
%
|
||||||||||||
Total
|
$
|
230,095
|
100
|
%
|
$
|
210,661
|
100
|
%
|
$
|
223,615
|
100
|
%
|
1
Year
|
5
Years
|
Over
|
Total
|
|||||||||||||
Within
|
Thru
5
|
Thru
10
|
10
|
Market
|
||||||||||||
1
Year
|
Years
|
Years
|
Years
|
Value
|
||||||||||||
Securities
Available-for-Sale:
|
||||||||||||||||
U.S.
government and agencies
|
$
|
30,200
|
$
|
59,712
|
$
|
7,209
|
$
|
9,898
|
$
|
107,019
|
||||||
Mortgage-backed
securities
|
2,133
|
56,822
|
2,745
|
2,238
|
63,938
|
|||||||||||
Obligations
of states and
|
||||||||||||||||
political
subdivisions
|
509
|
3,633
|
2,919
|
50,600
|
57,661
|
|||||||||||
Corporate
and other debt
|
400
|
—
|
—
|
1,077
|
1,477
|
|||||||||||
Total
|
$
|
33,242
|
$
|
120,167
|
$
|
12,873
|
$
|
63,813
|
$
|
230,095
|
||||||
Percentage
of total
|
14.45
|
%
|
52.23
|
%
|
5.59
|
%
|
27.73
|
%
|
100.00
|
%
|
||||||
Weighted
average yield*
|
3.38
|
%
|
4.64
|
%
|
5.34
|
%
|
6.40
|
%
|
4.73
|
%
|
2005
|
2004
|
2003
|
|||||||||||||||||
Average
|
Avg.
|
Average
|
Avg.
|
Average
|
Avg.
|
||||||||||||||
Balance
|
Yield
|
Balance
|
Yield
|
Balance
|
Yield
|
||||||||||||||
Non-interest-bearing
|
|||||||||||||||||||
demand
deposits
|
$
|
112,860
|
—
|
$
|
94,871
|
—
|
$
|
75,840
|
—
|
||||||||||
Interest-bearing
demand
|
|||||||||||||||||||
deposits
|
293,129
|
1.67
|
%
|
279,217
|
.97
|
%
|
213,420
|
.82
|
%
|
||||||||||
Savings
deposits
|
58,964
|
.41
|
%
|
63,471
|
.37
|
%
|
53,753
|
.40
|
%
|
||||||||||
Time
deposits less than $100
|
264,503
|
2.28
|
%
|
209,708
|
2.36
|
%
|
219,817
|
3.19
|
%
|
||||||||||
Time
deposits $100 or more
|
187,412
|
4.24
|
%
|
149,113
|
2.83
|
%
|
139,571
|
.72
|
%
|
||||||||||
Total
|
$
|
916,868
|
$
|
796,380
|
$
|
702,401
|
December
31, 2005
|
||||
Maturities
|
||||
3
Months or Less.
|
$
|
58,243
|
||
3-6
Months
|
68,184
|
|||
6-12
Months
|
63,068
|
|||
Over
1 Year.
|
75,258
|
|||
Total
|
$
|
264,753
|
2005
|
2004
|
2003
|
||||||||
Federal
funds purchased
|
$
|
—
|
$
|
—
|
$
|
5,800
|
||||
Securities
sold under agreements to repurchase
|
90,939
|
86,914
|
66,040
|
|||||||
Short-term
FHLB advances
|
31,000
|
23,318
|
—
|
|||||||
Total
short-term borrowings
|
121,939
|
110,232
|
71,840
|
|||||||
Long-term
FHLB advances
|
92,444
|
139,486
|
168,024
|
|||||||
Junior
subordinated debentures
|
35,929
|
35,929
|
23,711
|
|||||||
Total
long-term borrowings
|
128,373
|
175,415
|
191,735
|
|||||||
Total
borrowings
|
$
|
250,312
|
$
|
285,647
|
$
|
263,575
|
||||
Average
balance (from Table 1)
|
$
|
260,349
|
$
|
287,940
|
$
|
245,990
|
(Dollars
in thousands)
|
|||||||
2005
|
2004
|
||||||
+200
basis point increase
|
$
|
322
|
$
|
(592
|
)
|
||
+100
basis point increase
|
$
|
286
|
$
|
(146
|
)
|
||
-100
basis point decrease
|
$
|
(1,228
|
)
|
$
|
(1,657
|
)
|
Payments
Due by Period
|
|||||||||||||||||||
Contractual
Obligations
|
Note
|
Less
than
|
1-3
|
3-5
|
More
than
|
||||||||||||||
(in
millions)
|
Reference
|
Total
|
1
Year
|
Years
|
Years
|
5
Years
|
|||||||||||||
Long
term debt
|
8
|
||||||||||||||||||
FHLB
Advances
|
$
|
92.4
|
$
|
7.0
|
$
|
20.8
|
$
|
28.5
|
$
|
36.1
|
|||||||||
Junior
subordinated debt
|
35.9
|
—
|
—
|
—
|
35.9
|
||||||||||||||
Operating
leases
|
5
|
1.5
|
.4
|
.7
|
.4
|
—
|
|||||||||||||
Data
processing and
telecommunications
services
|
5
|
7.0
|
1.4
|
2.8
|
2.8
|
—
|
|||||||||||||
Time
Deposits
|
7
|
470.7
|
303.1
|
144.3
|
22.5
|
.8
|
Commitment
Expiration by Period
|
|||||||||||||||||||
Commitments
|
Note
|
Less
than
|
1-3
|
3-5
|
More
than
|
||||||||||||||
(in
millions)
|
Reference
|
Total
|
1
Year
|
Years
|
Years
|
5
Years
|
|||||||||||||
Loan
commitments
|
4
|
$
|
161.1
|
$
|
17.8
|
$
|
8.3
|
$
|
2.9
|
$
|
132.1
|
||||||||
Letters
of credit
|
4
|
5.1
|
5.1
|
—
|
—
|
—
|
December
31
|
|||||||
2005
|
2004
|
||||||
Assets
|
|||||||
Cash
and due from banks
|
$
|
24,610
|
$
|
24,159
|
|||
Interest-bearing
deposits in banks
|
5,001
|
1,855
|
|||||
Investment
securities available-for-sale (at market
|
|||||||
value)
|
230,095
|
210,661
|
|||||
Federal
Home Loan Bank stock, at cost
|
8,050
|
9,525
|
|||||
Loans
|
960,961
|
911,450
|
|||||
Allowance
for loan losses
|
(6,416
|
)
|
(6,814
|
)
|
|||
Net
loans
|
954,545
|
904,636
|
|||||
Premises
and equipment, net
|
27,049
|
23,523
|
|||||
Goodwill
and other intangible assets, net
|
14,591
|
15,149
|
|||||
Bank
owned life insurance
|
24,239
|
23,420
|
|||||
Accrued
interest receivable and other assets
|
22,811
|
20,973
|
|||||
Total
Assets
|
$
|
1,310,991
|
$
|
1,233,901
|
|||
Liabilities
and Shareholders’ Equity
|
|||||||
Liabilities:
|
|||||||
Non-interest-bearing
deposits
|
$
|
114,523
|
$
|
114,734
|
|||
Interest-bearing
deposits
|
841,331
|
735,927
|
|||||
Total
deposits
|
955,854
|
850,661
|
|||||
Short-term
borrowings
|
121,939
|
110,232
|
|||||
Long-term
borrowings
|
128,373
|
175,415
|
|||||
Accrued
interest and other liabilities
|
11,623
|
10,110
|
|||||
Dividends
payable
|
1,163
|
1,127
|
|||||
Total
Liabilities
|
1,218,952
|
1,147,545
|
|||||
Shareholders’
Equity:
|
|||||||
Preferred
stock—no par value;
|
|||||||
authorized
and unissued 2,000 shares
|
|||||||
Capital
stock—par value$.01 per share;
|
|||||||
authorized 25,000 shares, issued and outstanding
|
|||||||
6,118
in 2005 and 6,093 in 2004
|
61
|
61
|
|||||
Surplus
|
20,946
|
20,453
|
|||||
Retained
earnings
|
73,012
|
65,405
|
|||||
Accumulated
other comprehensive income
|
(1,980
|
)
|
437
|
||||
Total
Shareholders’ Equity
|
92,039
|
86,356
|
|||||
Total
Liabilities and Shareholders’ Equity
|
$
|
1,310,991
|
$
|
1,233,901
|
Year
ended December 31
|
||||||||||
2005
|
2004
|
2003
|
||||||||
Interest
income
|
||||||||||
Interest
and fees on loans
|
$
|
61,570
|
$
|
53,264
|
$
|
49,316
|
||||
Interest
on investment securities:
|
||||||||||
Taxable
|
6,747
|
6,177
|
6,921
|
|||||||
Exempt
from federal income taxes
|
1,384
|
1,206
|
1,427
|
|||||||
8,131
|
7,383
|
8,348
|
||||||||
Interest
on federal funds sold
|
55
|
35
|
39
|
|||||||
Total
interest income
|
69,756
|
60,682
|
57,703
|
|||||||
Interest
expense
|
||||||||||
Interest
on deposits
|
19,104
|
12,108
|
12,775
|
|||||||
Interest
on short-term borrowings
|
2,749
|
1,153
|
447
|
|||||||
Interest
on long-term borrowings
|
7,560
|
10,755
|
10,379
|
|||||||
Total
interest expense
|
29,413
|
24,016
|
23,601
|
|||||||
Net
interest income
|
40,343
|
36,666
|
34,102
|
|||||||
Provision
for loan losses
|
1,078
|
2,534
|
833
|
|||||||
Net
interest income after provision
|
||||||||||
for
loan losses
|
39,265
|
34,132
|
33,269
|
|||||||
Other
operating income
|
||||||||||
Service
charge income
|
5,463
|
4,749
|
3,895
|
|||||||
Trust
department income
|
3,260
|
3,153
|
2,520
|
|||||||
Insurance
premium income
|
1,599
|
1,448
|
1,367
|
|||||||
Gain
related to prepayment of long term borrowings
|
868
|
—
|
—
|
|||||||
Security
gains (losses)
|
(125
|
)
|
703
|
1,009
|
||||||
Bank
owned life insurance
|
819
|
626
|
938
|
|||||||
Other
income
|
2,204
|
2,292
|
2,138
|
|||||||
Total
other operating income
|
14,088
|
12,971
|
11,867
|
|||||||
Other
operating expense
|
||||||||||
Salaries
and employee benefits
|
18,428
|
16,907
|
15,995
|
|||||||
Equipment
|
3,067
|
2,952
|
2,426
|
|||||||
Expenses
related to prepayment
|
||||||||||
of
long-term borrowings
|
437
|
2,728
|
—
|
|||||||
Occupancy
|
1,642
|
1,642
|
1,330
|
|||||||
Data
processing
|
1,404
|
1,380
|
1,217
|
|||||||
Other
expenses
|
9,676
|
10,360
|
8,853
|
|||||||
Total
other operating expense
|
34,654
|
35,969
|
29,821
|
|||||||
Income
before income taxes
|
18,699
|
11,134
|
15,315
|
|||||||
Applicable
income taxes
|
6,548
|
3,507
|
4,566
|
|||||||
Net
income
|
$
|
12,151
|
$
|
7,627
|
$
|
10,749
|
||||
Earnings
per share
|
$
|
1.99
|
$
|
1.25
|
$
|
1.77
|
||||
Weighted
average common shares outstanding
|
6,105,699
|
6,088,367
|
6,086,369
|
Capital
Stock
|
Surplus
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income
|
Total
Shareholders’
Equity
|
||||||||||||
Balance
at January 1, 2002
|
$
|
61
|
$
|
20,199
|
$
|
50,254
|
$
|
562
|
$
|
71,076
|
||||||
Comprehensive
income:
|
||||||||||||||||
Net
income for the year
|
9,655
|
9,655
|
||||||||||||||
Unrealized
gains on securities
|
||||||||||||||||
available-for-sale,
|
||||||||||||||||
net
of income taxes of $1,951
|
2,718
|
2,718
|
||||||||||||||
Comprehensive
income
|
12,373
|
|||||||||||||||
Cash
dividends—$.685 per share
|
(4,166
|
)
|
(4,166
|
)
|
||||||||||||
Balance
at December 31, 2002
|
61
|
20,199
|
55,743
|
3,280
|
79,283
|
|||||||||||
Comprehensive
income:
|
||||||||||||||||
Net
income for the year
|
10,749
|
10,749
|
||||||||||||||
Unrealized
loss on securities
|
||||||||||||||||
available-for-sale,
|
||||||||||||||||
net
of income tax benefit of $904
|
(1,675
|
)
|
(1,675
|
)
|
||||||||||||
Comprehensive
income
|
9,074
|
|||||||||||||||
Issuance
of 7,000 shares of common
|
||||||||||||||||
stock
under dividend reinvestment plan
|
125
|
125
|
||||||||||||||
Cash
dividends—$.705 per share
|
(4,291
|
)
|
(4,291
|
)
|
||||||||||||
Balance
at December 31, 2003
|
61
|
20,324
|
62,201
|
1,605
|
84,191
|
|||||||||||
Comprehensive
income:
|
||||||||||||||||
Net
income for the year
|
7,627
|
7,627
|
||||||||||||||
Unrealized
loss on securities
|
||||||||||||||||
available-for-sale,
|
||||||||||||||||
net
of income tax benefit of $286
|
(1,168
|
)
|
(1,168
|
)
|
||||||||||||
Comprehensive
income
|
6,459
|
|||||||||||||||
Issuance
of 6,000 shares of common
|
||||||||||||||||
stock
under dividend reinvestment plan
|
129
|
129
|
||||||||||||||
Cash
dividends—$.725 per share
|
(4,423
|
)
|
(4,423
|
)
|
||||||||||||
Balance
at December 31, 2004
|
61
|
20,453
|
65,405
|
437
|
86,356
|
|||||||||||
Comprehensive
income:
|
||||||||||||||||
Net
income for the year
|
12,151
|
12,151
|
||||||||||||||
Unrealized
loss on securities
|
||||||||||||||||
available-for-sale,
|
||||||||||||||||
net
of income taxes of $1,295
|
(2,417
|
)
|
(2,417
|
)
|
||||||||||||
Comprehensive
income
|
9,734
|
|||||||||||||||
Issuance
of 24,578 shares of common
|
||||||||||||||||
stock
under dividend reinvestment plan
|
493
|
493
|
||||||||||||||
Cash
dividends—$.745 per share
|
(4,544
|
)
|
(4,544
|
)
|
||||||||||||
Balance
at December 31, 2005
|
$
|
61
|
$
|
20,946
|
$
|
73,012
|
$
|
(1,980
|
)
|
$
|
92,039
|
Year
ended December 31
|
||||||||||
2005
|
2004
|
2003
|
||||||||
Operating
activities
|
||||||||||
Net
income
|
$
|
12,151
|
$
|
7,627
|
$
|
10,749
|
||||
Adjustments
to reconcile net income to net cash
|
||||||||||
provided
by operating activities:
|
||||||||||
Provision
for loan losses
|
1,078
|
2,534
|
833
|
|||||||
Depreciation
and amortization
|
3,074
|
2,921
|
2,338
|
|||||||
Net
accretion and amortization of investment
|
||||||||||
security
discounts and premiums
|
483
|
1,106
|
1,935
|
|||||||
(Gain)
loss on sale of investment securities
|
125
|
(703
|
)
|
(1,009
|
)
|
|||||
(Increase)
decrease in accrued interest
|
||||||||||
receivable
and other assets
|
(1,838
|
)
|
(5,604
|
)
|
(3,560
|
)
|
||||
(Decrease)
increase in accrued interest and
|
||||||||||
other
liabilities
|
1,513
|
920
|
41
|
|||||||
Proceeds
from sale of mortgage loans
|
30,941
|
—
|
—
|
|||||||
Increase
in cash surrender value of bank owned
|
||||||||||
life
insurance
|
(819
|
)
|
(625
|
)
|
(938
|
)
|
||||
Net
cash provided by operating activities
|
46,708
|
8,176
|
10,389
|
|||||||
Investing
activities
|
||||||||||
Net
(increase) decrease in interest-bearing deposits
|
||||||||||
in
banks
|
(3,146
|
)
|
(381
|
)
|
4,733
|
|||||
Proceeds
from maturities of investment securities
|
||||||||||
available-for-sale
|
87,035
|
127,250
|
167,130
|
|||||||
Proceeds
from sales of investment securities
|
||||||||||
available-for-sale
|
27,684
|
14,008
|
98,615
|
|||||||
Purchases
of investment securities
|
||||||||||
available-for-sale
|
(139,118
|
)
|
(129,912
|
)
|
(277,588
|
)
|
||||
Net
increase in loans
|
(80,452
|
)
|
(121,118
|
)
|
(77,452
|
)
|
||||
Net
(increase) decrease in FHLB stock
|
1,475
|
(865
|
)
|
498
|
||||||
Purchase
of premises and equipment
|
(5,542
|
)
|
(9,288
|
)
|
(4,200
|
)
|
||||
Purchase
of additional bank owned life insurance
|
—
|
(2,300
|
)
|
—
|
||||||
Net
cash provided by acquisition
|
—
|
—
|
66,040
|
|||||||
Net
cash used in investing activities
|
(112,064
|
)
|
(122,606
|
)
|
(22,224
|
)
|
||||
Financing
activities
|
||||||||||
Net
increase in deposits
|
105,193
|
100,500
|
8,799
|
|||||||
Net
increase in short-term borrowings
|
11,707
|
38,392
|
16,240
|
|||||||
Proceeds
from long-term borrowings
|
—
|
35,929
|
—
|
|||||||
Payments
on long-term borrowings
|
(47,042
|
)
|
(52,249
|
)
|
(7,037
|
)
|
||||
Cash
dividends paid
|
(4,544
|
)
|
(4,384
|
)
|
(4,262
|
)
|
||||
Proceeds
from issuance of common stock
|
493
|
129
|
125
|
|||||||
Net
cash provided by financing activities
|
65,807
|
118,317
|
13,865
|
|||||||
Increase
(decrease) in cash and
|
||||||||||
cash
equivalents
|
451
|
3,887
|
2,030
|
|||||||
Cash
and cash equivalents at beginning of year
|
24,159
|
20,272
|
18,242
|
|||||||
Cash
and cash equivalents at end of year
|
$
|
24,610
|
$
|
24,159
|
$
|
20,272
|
||||
Supplemental
information
|
||||||||||
Interest
paid
|
$
|
28,557
|
$
|
23,605
|
$
|
24,641
|
||||
Income
taxes paid
|
6,750
|
6,262
|
5,218
|
|||||||
Acquisition
of a business:
|
||||||||||
Fair
value of assets acquired:
|
||||||||||
Loans
|
48,841
|
|||||||||
Premises
and equipment
|
1,340
|
|||||||||
Goodwill
and other identified intangibles
|
14,682
|
|||||||||
Fair
value of liabilities assumed:
|
||||||||||
Demand
deposit and savings accounts
|
(79,611
|
)
|
||||||||
Certificates
of deposits
|
(51,292
|
)
|
||||||||
Net
cash provided by acquisition
|
66,040
|
To
Be Well
|
|||||||||||||||||||
Capitalized
Under
|
|||||||||||||||||||
For
Capital
|
Prompt
Corrective
|
||||||||||||||||||
Actual
|
Adequacy
Purposes
|
Action
Provisions
|
|||||||||||||||||
(Dollars
in thousands)
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||||
December
31, 2005
|
|||||||||||||||||||
Total
Capital (to Risk Weighted Assets)
|
|||||||||||||||||||
Consolidated
|
$
|
121,773
|
12.66
|
%
|
$
|
76,958
|
8.00
|
%
|
$
|
96,198
|
10.00
|
%
|
|||||||
First
United Bank
|
105,029
|
11.04
|
%
|
76,116
|
8.00
|
%
|
95,148
|
10.00
|
%
|
||||||||||
Tier
I Capital
(to Risk Weighted Assets)
|
|||||||||||||||||||
Consolidated
|
110,357
|
11.45
|
%
|
38,479
|
4.00
|
%
|
57,719
|
6.00
|
%
|
||||||||||
First
United Bank
|
98,820
|
10.39
|
%
|
38,059
|
4.00
|
%
|
57,089
|
6.00
|
%
|
||||||||||
Tier
I Capital (to Average Assets)
|
|||||||||||||||||||
Consolidated
|
110,357
|
8.64
|
%
|
51,120
|
4.00
|
%
|
63,899
|
5.00
|
%
|
||||||||||
First
United Bank
|
98,820
|
7.80
|
%
|
50,694
|
4.00
|
%
|
63,368
|
5.00
|
%
|
To
Be Well
|
|||||||||||||||||||
Capitalized
Under
|
|||||||||||||||||||
For
Capital
|
Prompt
Corrective
|
||||||||||||||||||
Actual
|
Adequacy
Purposes
|
Action
Provisions
|
|||||||||||||||||
(Dollars
in thousands)
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||||
December
31, 2004
|
|||||||||||||||||||
Total
Capital (to Risk Weighted Assets)
|
|||||||||||||||||||
Consolidated
|
$
|
112,584
|
12.24
|
%
|
$
|
73,570
|
8.00
|
%
|
$
|
91,962
|
10.00
|
%
|
|||||||
First
United Bank
|
97,531
|
10.70
|
%
|
72,910
|
8.00
|
%
|
91,137
|
10.00
|
%
|
||||||||||
Tier
I Capital (to Risk Weighted Assets)
|
|||||||||||||||||||
Consolidated
|
99,410
|
10.81
|
%
|
36,785
|
4.00
|
%
|
55,177
|
6.00
|
%
|
||||||||||
First
United Bank
|
90,870
|
9.97
|
%
|
36,455
|
4.00
|
%
|
54,682
|
6.00
|
%
|
||||||||||
Tier
I Capital (to Average Assets)
|
|||||||||||||||||||
Consolidated
|
99,410
|
8.44
|
%
|
35,350
|
3.00
|
%
|
58,917
|
5.00
|
%
|
||||||||||
First
United Bank
|
90,870
|
7.57
|
%
|
35,999
|
3.00
|
%
|
59,998
|
5.00
|
%
|
Gross
|
Gross
|
||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Market
|
||||||||||
Cost
|
Gains
|
Losses
|
Value
|
||||||||||
December
31, 2005
|
|||||||||||||
U.S.
government and agencies
|
$
|
108,301
|
$
|
6
|
$
|
1,288
|
$
|
107,019
|
|||||
Mortgage-backed
securities
|
65,647
|
33
|
1,742
|
63,938
|
|||||||||
Obligations
of states and political subdivisions
|
58,041
|
784
|
1,164
|
57,661
|
|||||||||
Corporate
and other debt securities
|
1,381
|
96
|
—
|
1,477
|
|||||||||
Totals
|
$
|
233,370
|
$
|
919
|
$
|
4,194
|
$
|
230,095
|
|||||
December
31, 2004
|
|||||||||||||
U.S.
government and agencies
|
$
|
102,790
|
$
|
101
|
$
|
597
|
$
|
102,294
|
|||||
Mortgage-backed
securities
|
74,324
|
195
|
133
|
74,386
|
|||||||||
Obligations
of states and political subdivisions
|
21,503
|
960
|
2
|
22,461
|
|||||||||
Corporate
and other debt securities
|
11,320
|
200
|
—
|
11,520
|
|||||||||
Totals
|
$
|
209,937
|
$
|
1,456
|
$
|
732
|
$
|
210,661
|
2005
|
2004
|
2003
|
||||||||
Proceeds
|
$
|
27,684
|
$
|
14,008
|
$
|
98,615
|
||||
Realized
gains
|
93
|
712
|
1,755
|
|||||||
Realized
losses
|
(218
|
)
|
(9
|
)
|
(746
|
)
|
||||
Income
taxes (benefit) –
securities
gains/losses
|
(.1
|
)
|
.2
|
.4
|
December
31, 2005
|
|||||||||||||
Less
than 12 months
|
12
months or more
|
||||||||||||
Fair
|
Unrealized
|
Fair
|
Unrealized
|
||||||||||
Value
|
Losses
|
Value
|
Losses
|
U.S.
government and agencies
|
$
|
61,312
|
$
|
(718
|
)
|
$
|
42,005
|
$
|
(570
|
)
|
|||
Mortgage-backed
securities
|
42,321
|
(1,164
|
)
|
17,812
|
(579
|
)
|
|||||||
Obligations
of states and political subdivisions
|
36,596
|
(1,163
|
)
|
—
|
—
|
||||||||
$
|
140,229
|
(3,045
|
)
|
$
|
59,817
|
($1,149
|
)
|
December
31, 2004
|
|||||||||||||
Less
than 12 months
|
12
months or more
|
||||||||||||
Fair
|
Unrealized
|
Fair
|
Unrealized
|
||||||||||
Value
|
Losses
|
Value
|
Losses
|
||||||||||
U.S.
government and agencies
|
$
|
74,177
|
$
|
(569
|
)
|
$
|
2,021
|
$
|
(28
|
)
|
|||
Mortgage-backed
securities
|
21,428
|
(77
|
)
|
5,758
|
(56
|
)
|
|||||||
Obligations
of states and political Subdivisions
|
866
|
(2
|
)
|
—
|
—
|
||||||||
$
|
96,471
|
$
|
(648
|
)
|
$
|
7,779
|
$
|
(84
|
)
|
Securities
Available-for-Sale
|
|||||||
(in
thousands)
|
|||||||
Amortized
|
Market
|
||||||
Contractual
Maturity
|
Cost
|
Value
|
|||||
Due
in one year or less
|
$
|
31,407
|
$
|
31,109
|
|||
Due
after one year through five years
|
63,961
|
63,345
|
|||||
Due
after five years through ten years
|
10,129
|
10,128
|
|||||
Due
after ten years
|
62,226
|
61,575
|
|||||
167,723
|
166,157
|
||||||
Mortgage-backed
securities
|
65,647
|
63,938
|
|||||
$
|
233,370
|
$
|
230,095
|
December
31, 2005
|
December
31, 2004
|
||||||||||||
Loan
|
Loan
|
||||||||||||
Loans
|
Commitments
|
Loans
|
Commitments
|
||||||||||
Commercial
|
$
|
404,681
|
$
|
110,000
|
$
|
373,893
|
$
|
91,705
|
|||||
Residential—mortgage
|
337,559
|
39,350
|
319,033
|
36,456
|
|||||||||
Installment
|
193,275
|
42
|
199,862
|
514
|
|||||||||
Residential—construction
|
25,446
|
11,701
|
18,196
|
12,734
|
|||||||||
Lease
financing
|
—
|
—
|
466
|
—
|
|||||||||
Commercial
letters of credit
|
—
|
5,086
|
—
|
5,336
|
|||||||||
Total
|
$
|
960,961
|
$
|
166,179
|
$
|
911,450
|
$
|
146,745
|
2005
|
2004
|
2003
|
||||||||
Balance
at January 1
|
$
|
16,006
|
$
|
16,794
|
$
|
18,796
|
||||
Loans
or advances
|
14,070
|
12,396
|
12,557
|
|||||||
Repayments
|
(12,391
|
)
|
(13,184
|
)
|
(14,559
|
)
|
||||
Balance
at December 31
|
$
|
17,685
|
$
|
16,006
|
$
|
16,794
|
2005
|
|
2004
|
|
2003
|
||||||
Balance
at January 1
|
$
|
6,814
|
$
|
5,974
|
$
|
6,068
|
||||
Gross
credit losses
|
(1,890
|
)
|
(2,205
|
)
|
(1,720
|
)
|
||||
Recoveries
|
414
|
511
|
492
|
|||||||
Net
credit losses
|
(1,476
|
)
|
(1,694
|
)
|
(1,228
|
)
|
||||
Provision
for loan losses
|
1,078
|
2,534
|
833
|
|||||||
Huntington
Branch acquisition loan loss
reserve
|
—
|
—
|
301
|
|||||||
Balance
at December 31
|
$
|
6,416
|
$
|
6,814
|
$
|
5,974
|
2005
|
2004
|
||||||
Land
|
$
|
9,232
|
$
|
8,397
|
|||
Land
Improvements
|
135
|
—
|
|||||
Premises
|
16,987
|
13,489
|
|||||
Furniture
and equipment
|
26,533
|
25,152
|
|||||
52,887
|
47,038
|
||||||
Less
accumulated depreciation
|
(25,838
|
)
|
(23,515
|
)
|
|||
Total
|
$
|
27,049
|
$
|
23,523
|
2005
|
2004
|
||||||||||||||||||||||||
Gross
Carrying Amount
|
Accumulated
Amortization
|
Net
Carrying Amount
|
Weighted
Average Remaining Life
|
Gross
Carrying Amount
|
Accumulated
Amortization
|
Net
Carrying Amount
|
Weighted
Average Remaining Life
|
||||||||||||||||||
Goodwill
|
$
|
11,900
|
$
|
—
|
$
|
11,900
|
$
|
11,900
|
$
|
—
|
$
|
11,900
|
|||||||||||||
Core
deposit intangible assets
|
4,040
|
(1,349
|
)
|
2,691
|
4.8
|
4,040
|
(791
|
)
|
3,249
|
5.8
|
|||||||||||||||
Total
|
$
|
15,940
|
$
|
(1,349
|
)
|
$
|
14,591
|
$
|
15,940
|
$
|
(791
|
)
|
$
|
15,149
|
2006
|
$
|
558
|
||
2007
|
558
|
|||
2008
|
558
|
|||
2009
|
558
|
|||
2010
|
449
|
2006
|
$
|
303,083
|
||
2007
|
107,167
|
|||
2008
|
37,074
|
|||
2009
|
10,497
|
|||
2010
|
11,992
|
|||
Thereafter
|
902
|
2005
|
2004
|
2003
|
||||||||
Federal
funds purchased (weighted
|
||||||||||
average
interest rate at December 31, 2003
|
||||||||||
(1.20%)
|
$
|
—
|
$
|
—
|
$
|
5,800
|
||||
Short-term
FHLB advance,
|
||||||||||
Daily
borrowings, interest rate of 4.49%
|
31,000
|
—
|
—
|
|||||||
Short-term
FHLB advance,
|
||||||||||
Interest
rate of 2.6% maturing in March 2005
|
—
|
23,319
|
—
|
|||||||
2005
|
2004
|
2003
|
Securities
sold under agreements to repurchase:
|
||||||||||
Outstanding
at end of year
|
$
|
90,939
|
$
|
86,914
|
$
|
66,040
|
||||
Weighted
average interest at year end
|
2.56
|
%
|
2.14
|
%
|
1.03
|
%
|
||||
Maximum
amount outstanding as of
|
||||||||||
any
month end
|
93,632
|
91,209
|
66,040
|
|||||||
Average
amount outstanding
|
85,846
|
78,352
|
49,278
|
|||||||
Approximate
weighted average rate
|
||||||||||
during
the year
|
2.68
|
%
|
1.44
|
%
|
.86
|
%
|
2005
|
2004
|
||||||
FHLB
advances, bearing interest at rates ranging
|
|||||||
from
3.15% to 5.57% at December 31
|
$
|
92,444
|
$
|
139,486
|
|||
Junior
subordinated debt, bearing interest at rates
|
|||||||
ranging
from 6.02% to 7.25%
|
35,929
|
35,929
|
|||||
$
|
128,373
|
$
|
175,415
|
1-4
family mortgage loans
|
$
|
127,687
|
||
Commercial
loans
|
6,822
|
|||
Investment
securities
|
56,868
|
|||
$
|
191,377
|
2005
|
2004
|
2003
|
||||||||
Taxes
currently payable - federal and state
|
$
|
5,299
|
$
|
5,324
|
$
|
6,060
|
||||
Deferred
taxes (benefit) - federal and state
|
1,249
|
(1,817
|
)
|
(1,494
|
)
|
|||||
Income
tax expense for the year
|
$
|
6,548
|
$
|
3,507
|
$
|
4,566
|
2005
|
2004
|
2003
|
||||||||
Federal
statutory rate
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
||||
Tax-exempt
income on securities and loans
|
(2.7
|
)
|
(4.1
|
)
|
(3.6
|
)
|
||||
Tax-exempt
BOLI income
|
(1.5
|
)
|
(2.0
|
)
|
(2.1
|
)
|
||||
State
income tax, net of federal tax benefit
|
3.9
|
4.4
|
.6
|
|||||||
Other
|
.3
|
(1.8
|
)
|
(.1
|
)
|
|||||
35.0
|
%
|
31.5
|
%
|
29.8
|
%
|
2005
|
2004
|
||||||
Deferred
tax assets:
|
|||||||
Allowance
for loan losses
|
$
|
2,538
|
$
|
2,695
|
|||
Deferred
loan fees
|
173
|
184
|
|||||
Deferred
compensation
|
558
|
506
|
|||||
State
tax loss carry forwards
|
658
|
575
|
|||||
Other
|
88
|
66
|
|||||
Total
deferred tax assets
|
4,015
|
4,026
|
|||||
Valuation
allowance
|
(658
|
)
|
(575
|
)
|
|||
Total
deferred tax assets less valuation allowance
|
3,357
|
3,451
|
|||||
Deferred
tax liabilities:
|
|||||||
Amortization
of goodwill and core deposit intangible
|
(363
|
)
|
(251
|
)
|
|||
Depreciation
|
(1,176
|
)
|
(1,450
|
)
|
|||
Unrealized
gain/(loss) on investment securities
|
|||||||
available-for-sale
|
1,295
|
(287
|
)
|
||||
Pension
|
(2,459
|
)
|
(1,110
|
)
|
|||
Auto
leasing
|
—
|
(186
|
)
|
||||
Other
|
(371
|
)
|
(218
|
)
|
|||
Total
deferred tax liabilities
|
(3,074
|
)
|
(3,502
|
)
|
|||
Net
deferred tax assets (liabilities)
|
$
|
283
|
$
|
(51
|
)
|
2005
|
2004
|
||||||
Change
in Benefit Obligation
|
|||||||
Obligation
at the beginning of the year
|
$
|
16,718
|
$
|
14,724
|
|||
Service
cost
|
799
|
718
|
|||||
Interest
cost
|
1,035
|
938
|
|||||
Assumptions
|
0
|
245
|
|||||
Actuarial
(gains) losses
|
318
|
528
|
|||||
Benefits
paid
|
(447
|
)
|
(435
|
)
|
|||
Obligation
at the end of the year
|
$
|
18,423
|
$
|
16,718
|
|||
Change
in Plan Assets
|
|||||||
Fair
value at the beginning of the year
|
14,434
|
13,726
|
|||||
Actual
return on plan assets
|
507
|
725
|
|||||
Employer
contribution
|
4,782
|
418
|
|||||
Benefits
paid
|
(447
|
)
|
(435
|
)
|
|||
Fair
value at the end of the year
|
19,276
|
14,434
|
|||||
Funded
Status
|
852
|
(2,285
|
)
|
||||
Unrecognized
net actuarial loss
|
5,595
|
4,566
|
|||||
Unrecognized
prior service cost
|
142
|
152
|
|||||
Unrecognized
net transition asset
|
(371
|
)
|
(410
|
)
|
|||
Prepaid
Benefit Cost
|
$
|
6,218
|
$
|
2,023
|
2005
|
2004
|
2003
|
||||||||
Components
of Net Pension Cost
|
||||||||||
Service
cost
|
$
|
799
|
$
|
718
|
$
|
571
|
||||
Interest
cost
|
1,035
|
938
|
840
|
|||||||
Expected
return on assets
|
(1,406
|
)
|
(1,183
|
)
|
(1,005
|
)
|
||||
Amortization
of transition asset
|
(39
|
)
|
(39
|
)
|
(39
|
)
|
||||
Recognized
loss
|
189
|
151
|
136
|
|||||||
Prior
service cost
|
10
|
10
|
10
|
|||||||
Net
pension expense included in employee benefits
|
$
|
588
|
$
|
595
|
$
|
513
|
||||
Weighted
Average Assumptions
|
||||||||||
Discount
rate for benefit obligations
|
6.15
|
%
|
6.15
|
%
|
6.25
|
%
|
||||
Discount
rate for net pension cost
|
6.15
|
%
|
6.25
|
%
|
6.75
|
%
|
||||
Expected
long-term return on assets
|
8.25
|
%
|
8.25
|
%
|
8.25
|
%
|
||||
Rate
of compensation increase
|
4.00
|
%
|
4.00
|
%
|
4.00
|
%
|
Percentage
of
|
|||||||
Plan
Assets
|
|||||||
2005
|
2004
|
||||||
ASSET
CATEGORY
|
|||||||
Equity
securities
|
62
|
%
|
64
|
%
|
|||
Debt
securities
|
32
|
%
|
23
|
%
|
|||
Cash
and cash equivalents
|
6
|
%
|
13
|
%
|
|||
Total
|
100
|
%
|
100
|
%
|
2005
|
2004
|
||||||
Number
of shares held
|
3,839
|
14,905
|
|||||
Number
of shares purchased
|
33
|
—
|
|||||
Number
of shares sold
|
11,099
|
34,179
|
|||||
Fair
value
|
$
|
82
|
$
|
348
|
|||
Dividends
paid
|
$
|
6
|
$
|
33
|
|||
Percentage
of total plan assets
|
.42
|
%
|
2.4
|
%
|
|
||||
2006
|
438
|
|||
2007
|
450
|
|||
2008
|
476
|
|||
2009
|
569
|
|||
2010
|
637
|
|||
2011-2015
|
5,593
|
|||
$
|
8,163
|
2005
|
|
2004
|
|
||||||||||
|
|
Carrying
|
|
Fair
|
|
Carrying
|
|
Fair
|
|
||||
|
|
Amount
|
|
Value
|
|
Amount
|
|
Value
|
|||||
Financial
Assets:
|
|||||||||||||
Cash
and cash equivalents
|
$
|
24,610
|
$
|
24,610
|
$
|
24,159
|
$
|
24,159
|
|||||
Interest-bearing
deposits in
|
|||||||||||||
banks
|
5,001
|
5,001
|
1,855
|
1,855
|
|||||||||
Investment
securities
|
230,095
|
230,095
|
210,661
|
210,661
|
|||||||||
Federal
Home Loan Bank stock
|
8,050
|
8,050
|
9,525
|
9,525
|
|||||||||
Bank
Owned Life Insurance
|
24,239
|
24,239
|
23,420
|
23,420
|
|||||||||
Loans,
net
|
954,545
|
949,622
|
904,635
|
900,647
|
|||||||||
Accrued
interest receivable
|
6,114
|
6,114
|
5,200
|
5,200
|
|||||||||
Financial
Liabilities:
|
|||||||||||||
Deposits
|
955,854
|
952,350
|
850,661
|
790,555
|
|||||||||
Borrowed
funds
|
250,312
|
253,744
|
285,647
|
286,292
|
|||||||||
Accrued
interest payable
|
4,129
|
4,129
|
3,187
|
3,187
|
December
31
|
|||||||
2005
|
2004
|
||||||
Assets
|
|||||||
Cash
|
$
|
2,067
|
$
|
1,406
|
|||
Investment
securities
|
1,230
|
1,268
|
|||||
Investment
in bank subsidiary
|
113,411
|
106,052
|
|||||
Other
assets
|
5,711
|
5,583
|
|||||
Investment
in non-bank subsidiaries
|
9,962
|
9,851
|
|||||
Total
Assets
|
$
|
132,381
|
$
|
124,160
|
|||
Liabilities
and Shareholder’s Equity
|
|||||||
Accrued
interest and other liabilities
|
$
|
1,223
|
$
|
1,082
|
|||
Dividends
payable
|
1,163
|
1,127
|
|||||
Junior
subordinated debt
|
35,929
|
35,929
|
|||||
Shareholders’
equity
|
94,066
|
86,022
|
|||||
Total
Liabilities and Shareholder’s Equity
|
$
|
132,381
|
$
|
124,160
|
Year
Ended December
31
|
||||||||||
2005
|
2004
|
2003
|
||||||||
Income:
|
||||||||||
Dividend
income from bank subsidiary
|
$
|
8,009
|
$
|
8,718
|
$
|
6,786
|
||||
Other
income
|
253
|
422
|
84
|
|||||||
Total
income
|
$
|
8,262
|
9,140
|
6,870
|
||||||
Expenses:
|
||||||||||
Interest
expense
|
2,179
|
2,927
|
2,192
|
|||||||
Other
expenses
|
127
|
942
|
127
|
|||||||
Total
expenses
|
2,306
|
3,869
|
2,319
|
|||||||
Income
before income taxes and equity in undistributed
|
||||||||||
net
income of subsidiaries
|
5,956
|
5,271
|
4,551
|
|||||||
Income
tax benefit
|
—
|
1,205
|
795
|
|||||||
Equity
in undistributed net income (loss) of subsidiaries:
|
||||||||||
Bank
|
5,518
|
1,080
|
5,118
|
|||||||
Non-bank
|
677
|
71
|
285
|
|||||||
Net
Income
|
$
|
12,151
|
$
|
7,627
|
$
|
10,749
|
|
|
Year
Ended December 31
|
||||||||
2005
|
2004
|
2003
|
||||||||
Net
income
|
$
|
12,151
|
$
|
7,627
|
$
|
10,749
|
||||
Adjustments
to reconcile net income to net cash
|
||||||||||
provided
by operating activities:
|
||||||||||
Equity
in undistributed net income
|
||||||||||
of
subsidiaries
|
(6,194
|
)
|
(1,151
|
)
|
(5,403
|
)
|
||||
Increase
in other assets
|
(128
|
)
|
(830
|
)
|
(1,615
|
)
|
||||
Decrease
(increase) in accrued interest and other
|
||||||||||
liabilities
|
141
|
232
|
822
|
|||||||
Increase
in dividends payable
|
36
|
34
|
31
|
|||||||
Net
cash provided by operating activities
|
6,006
|
5,912
|
4,584
|
|||||||
INVESTING
ACTIVITIES
|
||||||||||
Proceeds
from investment maturities
|
38
|
269
|
—
|
|||||||
Net
investment in subsidiaries
|
(351
|
)
|
(1,401
|
)
|
(636
|
)
|
||||
Capital
transfer to Bank
|
—
|
(12,000
|
)
|
—
|
||||||
Net
cash used in investing activities
|
(313
|
)
|
(13,132
|
)
|
(636
|
)
|
||||
FINANCING
ACTIVITIES
|
||||||||||
Cash
dividends
|
(4,552
|
)
|
(4,433
|
)
|
(4,262
|
)
|
||||
Proceeds
from issuance of common stock
|
(480
|
)
|
(125
|
)
|
125
|
|||||
Proceeds
from issuance of long term debt
|
—
|
12,218
|
—
|
|||||||
Net
cash provided by (used in)
|
||||||||||
financing
activities
|
(5,032
|
)
|
7,660
|
(4,137
|
)
|
|||||
(Decrease)
increase in cash and cash equivalents
|
661
|
440
|
(189
|
)
|
||||||
Cash
and cash equivalents at beginning of year
|
1,406
|
966
|
1,155
|
|||||||
Cash
and cash equivalents at end of year
|
$
|
2,067
|
$
|
1,406
|
$
|
966
|
First
|
Second
|
Third
|
Fourth
|
||||||||||
Quarter
|
Quarter
|
Quarter
|
Quarter
|
||||||||||
2005
|
|||||||||||||
Interest
income
|
$
|
16,150
|
$
|
16,826
|
$
|
18,099
|
$
|
18,681
|
|||||
Interest
expense
|
6,560
|
6,833
|
7,710
|
8,310
|
|||||||||
Net
interest income
|
9,590
|
9,993
|
10,389
|
10,371
|
|||||||||
Provision
for possible loan losses
|
(91
|
)
|
1,007
|
356
|
(194
|
)
|
|||||||
Other
income
|
3,053
|
3,097
|
3,430
|
4,633
|
|||||||||
Gains
(losses) on securities
|
28
|
(218
|
)
|
59
|
6
|
||||||||
Other
expenses
|
8,479
|
8,509
|
8,787
|
8,879
|
|||||||||
Expenses
related to early redemption of
|
|||||||||||||
long-term
borrowings
|
—
|
—
|
—
|
—
|
|||||||||
Income
before income taxes
|
4,283
|
3,356
|
4,735
|
6,325
|
|||||||||
Applicable
income taxes
|
1,529
|
1,219
|
1,691
|
2,109
|
|||||||||
Net
income
|
$
|
2,754
|
$
|
2,137
|
$
|
3,044
|
$
|
4,216
|
|||||
Earnings
per share
|
$
|
.45
|
$
|
.35
|
$
|
.50
|
$
|
.69
|
First
|
Second
|
Third
|
Fourth
|
||||||||||
Quarter
|
Quarter
|
Quarter
|
Quarter
|
||||||||||
2004
|
|||||||||||||
Interest
income
|
$
|
14,601
|
$
|
14,853
|
$
|
15,160
|
$
|
16,067
|
|||||
Interest
expense
|
5,493
|
5,856
|
6,348
|
6,319
|
|||||||||
Net
interest income
|
9,108
|
8,997
|
8,812
|
9,748
|
|||||||||
Provision
for possible loan losses
|
45
|
739
|
851
|
899
|
|||||||||
Other
income
|
2,767
|
2,977
|
2,800
|
3,724
|
|||||||||
Gains
(losses) on securities
|
674
|
27
|
2
|
—
|
|||||||||
Other
expenses
|
8,396
|
8,233
|
8,185
|
8,426
|
|||||||||
Expenses
related to early redemption of
|
|||||||||||||
long-term
borrowings
|
—
|
—
|
910
|
1,818
|
|||||||||
Income
before income taxes
|
4,108
|
3,029
|
1,668
|
2,329
|
|||||||||
Applicable
income taxes
|
1,396
|
1,032
|
573
|
506
|
|||||||||
Net
income
|
$
|
2,712
|
$
|
1,997
|
$
|
1,095
|
$
|
1,823
|
|||||
Earnings
per share
|
$
|
.45
|
$
|
.33
|
$
|
.18
|
$
|
.29
|
/s/
William B. Grant
|
/s/
Carissa L. Rodeheaver
|
|
William
B. Grant, Esq., CFP
|
Carissa
L. Rodeheaver, CPA, CFP
|
|
Chairman
of the Board and
|
Senior
Vice President and
|
|
Chief
Executive Officer
|
Chief
Financial Office
|
First United Corporation | ||
|
|
|
Dated:
March 9, 2006
|
By: | /s/ / William B. Grant |
William
B. Grant, Esq., CFP
|
||
Chairman
of the Board and Chief Executive
Office
|
/s/
William B. Grant
|
/s/
David J. Beachy
|
|
(William
B. Grant) Director, Chief Executive Officer--March 9, 2006
|
(David
J. Beachy) Director--March 9, 2006
|
|
/s/
M. Kathryn Burkey
|
/s/
Faye E. Cannon
|
|
(M.
Kathryn Burkey) Director--March 9, 2006
|
(Faye
E. Cannon) Director--March 9, 2006
|
|
/s/
Paul Cox, Jr.
|
/s/
Raymond F. Hinkle
|
|
(Paul
Cox, Jr.) Director--March 9, 2006
|
(Raymond
F. Hinkle) Director--March 9, 2006
|
|
/s/
Robert W. Kurtz
|
/s/
John W. McCullough
|
|
(Robert
W. Kurtz) Director, President and Chief Risk Officer--March 9,
2006
|
(John
W. McCullough) Director--March 9, 2006
|
|
/s/
Elaine L. McDonald
|
/s/
Donald E. Moran
|
|
(Elaine
L. McDonald) Director--March 9, 2006
|
(Donald
E. Moran) Director--March 9, 2006
|
|
/s/
Karen F. Myers
|
/s/
Carissa L. Rodeheaver
|
|
(Karen
F. Myers) Director--March 9, 2006
|
(Carissa
L. Rodeheaver) Chief Financial Officer- March 9,
|
|
/s/
Gary R. Ruddell
|
/s/
I. Robert Rudy
|
|
(Gary
R. Ruddell Director--March 9, 2006
|
(I.
Robert Rudy) Director--March 9, 2006
|
|
/s/
Richard G. Stanton
|
/s/
Robert G. Stuck
|
|
(Richard
G. Stanton) Director - March 9, 2006
|
(Robert
G. Stuck) Director--March 9,
2006
|
Exhibit
|
Description
|
|
3.1
|
Amended
and Restated Articles of Incorporation (incorporated by reference
to
Exhibit 3.1 of the Corporation’s Quarterly Report on Form 10-Q for the
period ended June 30, 1998).
|
|
3.2
|
Amended
and Restated By-Laws (incorporated by reference to Exhibit 3(ii)
of the
Corporation’s Annual Report on Form 10-K for the year ended December 31,
1997).
|
|
10.1
|
First
United Bank & Trust Supplemental Executive Retirement Plan (“SERP”)
(incorporated by reference to Exhibit 10.1 of the Corporation’s Quarterly
Report on Form 10-Q for the period ended June 30,
2003).
|
|
10.2
|
Form
of SERP Participation Agreement between the Bank and each of William
B.
Grant, Robert W. Kurtz, Jeannette R. Fitzwater, Phillip D. Frantz,
Eugene
D. Helbig, Jr., Steven M. Lantz, Robin M. Murray, Frederick A. Thayer,
IV
(incorporated by reference to Exhibit 10.2 of the Corporation’s Quarterly
Report on Form 10-Q for the period ended June 30,
2003).
|
|
10.3
|
Endorsement
Split Dollar Agreement between the Bank and William B. Grant (incorporated
by reference to Exhibit 10.3 of the Corporation’s Quarterly Report on Form
10-Q for the period ended June 30, 2003).
|
|
10.4
|
Endorsement
Split Dollar Agreement between the Bank and Robert W. Kurtz (incorporated
by reference to Exhibit 10.4 of the Corporation’s Quarterly Report on Form
10-Q for the period ended June 30, 2003.
|
|
10.5
|
Endorsement
Split Dollar Agreement between the Bank and Jeannette R. Fitzwater
(incorporated by reference to Exhibit 10.5 of the Corporation’s Quarterly
Report on Form 10-Q for the period ended June 30,
2003).
|
|
10.6
|
Endorsement
Split Dollar Agreement between the Bank and Phillip D. Frantz
(incorporated by reference to Exhibit 10.6 of the Corporation’s Quarterly
Report on Form 10-Q for the period ended June 30,
2003).
|
|
10.7
|
Endorsement
Split Dollar Agreement between the Bank and Eugene D. Helbig, Jr.
(incorporated by reference to Exhibit 10.7 of the Corporation’s Quarterly
Report on Form 10-Q for the period ended June 30,
2003).
|
|
10.8
|
Endorsement
Split Dollar Agreement between the Bank and Steven M. Lantz (incorporated
by reference to Exhibit 10.8 of the Corporation’s Quarterly Report on Form
10-Q for the period June 30, 2003).
|
|
10.9
|
Endorsement
Split Dollar Agreement between the Bank and Robin M. Murray (incorporated
by reference to Exhibit 10.9 of the Corporation’s Quarterly Report on Form
10-Q for the period June 30, 2003).
|
|
10.10
|
Endorsement
Split Dollar Agreement between the Bank and Frederick A. Thayer,
IV
(incorporated by reference to Exhibit 10.10 of the Corporation’s Quarterly
Report on Form 10-Q for the period ended June 30,
2003).
|
|
10.11
|
First
United Corporation Executive and Director Deferred Compensation Plan
(incorporated by reference to Exhibit 10.11 of the Corporation’s Quarterly
Report on Form 10-Q for the period ended September 30,
2003).
|
|
21
|
Subsidiaries
of the Corporation, incorporated by reference to page 3 of this Annual
Report on Form 10-K.
|
|
23.1
|
Consent
of Ernst & Young LLP (filed herewith)
|
|
31.1
|
Certifications
of the CEO pursuant to Section 302 of the Sarbanes-Oxley Act (filed
herewith)
|
|
31.2
|
Certifications
of the CFO pursuant to Section 302 of the Sarbanes-Oxley Act (filed
herewith)
|
|
32.1
|
Certification
of the CEO pursuant to Section 906 of the Sarbanes-Oxley Act (furnished
herewith)
|
|
32.2
|
Certification
of the CFO pursuant to Section 906 of the Sarbanes-Oxley Act (furnished
herewith)
|