Marshall & Ilsley Corporation Announces Second Quarter Results
MILWAUKEE, July 13 /PRNewswire-FirstCall/ -- Marshall & Ilsley
Corporation (NYSE:MI) today reported 2004 second quarter net income
of $0.67 per diluted share, or $151.7 million, as compared to $0.59
per diluted share, or $134.7 million, in the second quarter of
2003. Second quarter net income per share increased 13.6 percent
over the same period in 2003. Net income for the six months ended
June 30, 2004 was $297.8 million, or $1.32 per diluted share,
compared to $262.7 million, or $1.15 per diluted share, in the
first half of 2003. Earnings for the first half of 2003 include
$1.5 million (after tax), or $0.01 per diluted share, of
Metavante's acquisition-related transition expenses. Return on
average assets based on net income for the second quarter was 1.69
percent, as compared to 1.62 percent for the same period in 2003.
Return on average equity based on net income was 17.92 percent this
quarter as compared to 16.88 percent for the second quarter of
2003. The Corporation's provision for loan and lease losses was
$9.2 million in the second quarter of 2004, versus $19.6 million in
the same period last year. Net charge-offs for the period were $5.0
million, or 0.08 percent of total average loans and leases
outstanding this quarter, and $9.8 million a year ago or 0.16
percent of total average loans and leases. At June 30, 2004, the
allowance for loan and lease losses was 1.32 percent of total loans
and leases, compared to 1.40 percent a year earlier. Nonperforming
loans and leases were 0.53 percent of total loans and leases at
June 30, 2004, and 0.82 percent at June 30, 2003. Assets at June
30, 2004 were $37.1 billion, compared to $34.1 billion at June 30,
2003. Book value per share was $15.52 at June 30, 2004, compared to
$14.36 for the same date a year ago. Total loans and leases were
$27.2 billion, compared to $24.9 billion at June 20, 2003. Proposed
Offerings On May 17, 2004, the Corporation announced that its
Metavante subsidiary had entered into a definitive agreement to
acquire NYCE Corporation for approximately $610 million in cash.
The Corporation expects to fund the acquisition or portions thereof
through the issuance of senior debt and an issuance of
approximately $400 million of a hybrid security. It is expected
that the hybrid security will consist of a trust preferred bundled
with a forward contract to purchase a variable number of shares of
M&I common stock. The funding and the acquisition are both
expected to be completed in the third quarter, subject to
regulatory approval of the acquisition. The debt and hybrid
security offerings are subject to market conditions and changes in
the expected timing, amount and terms. This press release does not
constitute an offer of any security for sale. Marshall & Ilsley
Corporation (NYSE:MI) is a diversified financial services
corporation headquartered in Milwaukee, Wis., with $37.1 billion in
assets. Founded in 1847, M&I Marshall & Ilsley Bank has the
largest banking presence in Wisconsin with 199 offices throughout
the state. In addition, M&I has 31 locations throughout
Arizona; 11 offices in metropolitan Minneapolis/St. Paul, Minn.;
and, locations in Duluth Minn.; Las Vegas, Nev.; and Naples and
Bonita Springs, Fla. M&I's Southwest Bank affiliate has six
offices in the St. Louis area and one office in Belleville, Ill.
Metavante Corporation, Marshall & Ilsley Corporation's wholly
owned technology subsidiary, provides virtually all of the
technology an organization needs to offer financial services.
M&I also provides trust and investment management, equipment
leasing, mortgage banking, asset-based lending, financial planning,
investments and insurance services from offices throughout the
country and on the Internet ( http://www.mibank.com/ or
http://www.micorp.com/ ). M&I's customer-based approach,
internal growth and strategic acquisitions have made M&I a
nationally recognized leader in the financial services industry.
This press release contains forward-looking statements concerning
M&I's future operations and financial results. Such statements
are subject to important factors that could cause M&I's actual
results to differ materially from those anticipated by the
forward-looking statements. These factors include (i) the factors
identified in M&I's Annual Report on Form 10-K for the year
ended December 31, 2003 under the heading "Forward-Looking
Statements" which factors are incorporated herein by reference, and
(ii) such other factors as may be described from time to time in
M&I's SEC filings. Note: Marshall & Ilsley Corporation will
hold a conference call at 11:00 a.m. central daylight time Tuesday,
July 13, regarding second quarter earnings. For those interested in
listening, please call 1-800-211-3767 and ask for M&I's
quarterly earnings release conference call. If you are unable to
join us at this time, a replay of the call will run through July
20, 5:00 p.m. central daylight time by calling 1-800-839-6713 and
entering passcode 644 26 81 to listen. Supplemental financial
information referenced in the conference call can be found at
http://www.micorp.com/ , Investor Relations, after 8:00 a.m. on
July 13. M&I Corporation Financial Information (unaudited)
Three Months Ended June 30, June 30, Percent 2004 2003 Change PER
SHARE DATA Diluted: Net Income $0.67 $0.59 13.6% Income as Adjusted
(a) 0.67 0.59 13.6 Basic: Net Income 0.68 0.59 15.3 Income as
Adjusted (a) 0.68 0.59 15.3 Dividend Declared 0.210 0.180 16.7 Book
Value 15.52 14.36 8.1 Shares Outstanding (millions): Average -
Diluted 225.5 228.4 -1.3 End of Period 222.8 227.1 -1.9 INCOME
STATEMENT ($millions) Net Interest Income (FTE) $292.0 $271.8 7.4%
Provision for Loan and Lease Losses 9.2 19.6 -53.1 Data Processing
Services 197.3 158.0 24.9 Item Processing 10.9 9.6 13.5 Trust
Services 37.9 31.2 21.5 Service Charge on Deposits 25.1 25.2 -0.4
Mortgage Banking 11.7 21.8 -46.3 Net Investment Securities Gains
(Losses) 0.1 (2.6) n.m. All Other 47.0 51.5 -8.7 Total Non-Interest
Revenues 330.0 294.7 12.0 Salaries and Employee Benefits 211.9
193.5 9.5 Occupancy and Equipment 44.5 46.2 -3.7 Intangible
Amortization 5.4 7.5 -28.0 Other 112.9 88.5 27.6 Total Non-Interest
Expenses 374.7 335.7 11.6 Tax Equivalent Adjustment 8.0 7.9 1.3
Pre-Tax Earnings 230.1 203.3 13.2 Income Taxes 78.4 68.6 14.3
Income as Adjusted (a) 151.7 134.7 12.6 Adjustments (a) 0.0 0.0
n.m. Net Income $151.7 $134.7 12.6% KEY RATIOS Net Interest
Margin(FTE) / Avg. Earning Assets 3.61% 3.65% Interest Spread (FTE)
3.32 3.33 Efficiency Ratio 60.2 59.0 Efficiency Ratio without
Metavante 48.8 48.2 Return on Assets 1.69 1.62 Return on Equity
17.92 16.88 Return on Assets - Income as Adjusted (a) 1.69 1.62
Return on Equity - Income as Adjusted (a) 17.92 16.88 Equity /
Assets (End of Period) 9.26 9.52 Notes: (a) See reconciliation of
Income as Adjusted to Net Income. M&I Corporation Financial
Information (unaudited) Six Months Ended June 30, June 30, Percent
2004 2003 Change PER SHARE DATA Diluted: Net Income $1.32 $1.15
14.8% Income as Adjusted (a) 1.32 1.16 13.8 Basic: Net Income 1.34
1.16 15.5 Income as Adjusted (a) 1.34 1.17 14.5 Dividend Declared
0.390 0.340 14.7 Book Value 15.52 14.36 8.1 Shares Outstanding
(millions): Average - Diluted 225.8 228.0 -1.0 End of Period 222.8
227.1 -1.9 INCOME STATEMENT ($millions) Net Interest Income (FTE)
$578.5 $544.3 6.3% Provision for Loan and Lease Losses 18.3 45.3
-59.6 Data Processing Services 383.5 315.1 21.7 Item Processing
22.3 19.8 12.6 Trust Services 74.2 61.2 21.2 Service Charge on
Deposits 50.6 51.4 -1.6 Mortgage Banking 18.7 39.3 -52.4 Net
Investment Securities Gains (Losses) (0.5) (1.0) n.m. All Other
94.6 99.4 -4.8 Total Non-Interest Revenues 643.4 585.2 9.9 Salaries
and Employee Benefits 415.8 388.0 7.2 Occupancy and Equipment 91.8
92.7 -1.0 Intangible Amortization 10.9 14.4 -24.3 Other 218.5 173.6
25.9 Total Non-Interest Expenses 737.0 668.7 10.2 Tax Equivalent
Adjustment 15.8 15.9 -0.6 Pre-Tax Earnings 450.8 399.6 12.8 Income
Taxes 153.0 135.4 13.0 Income as Adjusted (a) $297.8 $264.2 12.7
Adjustments (a) 0.0 (1.5) n.m. Net Income $297.8 $262.7 13.4% KEY
RATIOS Net Interest Margin(FTE) / Avg. Earning Assets 3.65% 3.72%
Interest Spread (FTE) 3.36 3.39 Efficiency Ratio 60.3 59.3
Efficiency Ratio without Metavante 49.0 48.4 Return on Assets 1.69
1.61 Return on Equity 17.67 16.81 Return on Assets - Income as
Adjusted (a) 1.69 1.62 Return on Equity - Income as Adjusted (a)
17.67 16.91 Equity / Assets (End of Period) 9.26 9.52 Notes: (a)
See reconciliation of Income as Adjusted to Net Income. M&I
Corporation Financial Information (unaudited) As of June 30, June
30, Percent ASSETS ($millions) 2004 2003 Change Cash & Due From
Banks $824 $988 -16.6% Trading Securities 28 30 -6.7 Short - Term
Investments 336 263 27.8 Investment Securities 5,915 5,363 10.3
Loans and Leases: Commercial Loans & Leases 8,158 7,540 8.2
Commercial Real Estate 8,775 7,932 10.6 Residential Real Estate
3,632 3,012 20.6 Home Equity Loans & Lines 4,885 4,109 18.9
Personal Loans and Leases 1,745 2,306 -24.3 Total Loans and Leases
27,195 24,899 9.2 Reserve for Loan & Leases Losses (358) (348)
2.9 Premises and Equipment, net 434 438 -0.9 Goodwill and
Intangibles 1,269 1,085 17.0 Other Assets 1,429 1,348 6.0 Total
Assets $37,072 $34,066 8.8% LIABILITIES & SHAREHOLDERS' EQUITY
($millions) Deposits: Noninterest Bearing $4,710 $4,653 1.2% Bank
Issued Interest Bearing Activity 9,928 10,127 -2.0 Bank Issued Time
3,352 3,361 -0.3 Total Bank Issued Deposits 17,990 18,141 -0.8
Wholesale Deposits 7,235 4,129 75.2 Total Deposits 25,225 22,270
13.3 Short - Term Borrowings 3,562 5,297 -32.8 Long - Term
Borrowings 3,701 2,272 62.9 Other Liabilities 1,150 984 16.9
Shareholders' Equity 3,434 3,243 5.9 Total Liabilities &
Shareholders' Equity $37,072 $34,066 8.8% Three Months Ended Six
Months Ended June 30, June 30, Percent June 30, June 30, Percent
2004 2003 Change 2004 2003 Change AVERAGE ASSETS ($millions) Cash
& Due From Banks $802 $747 7.4% $787 $755 4.2% Trading
Securities 22 25 -12.0 23 22 4.5 Short - Term Investments 165 282
-41.5 188 270 -30.4 Investment Securities 5,842 5,218 12.0 5,761
5,150 11.9 Loans and Leases: Commercial Loans & Leases 7,856
7,433 5.7 7,698 7,327 5.1 Commercial Real Estate 8,583 7,836 9.5
8,452 7,724 9.4 Residential Real Estate 3,502 2,894 21.0 3,364
2,846 18.2 Home Equity Loans and Lines 4,688 4,075 15.0 4,563 4,062
12.3 Personal Loans and Leases 1,879 2,161 -13.0 1,891 2,192 -13.7
Total Loans and Leases 26,508 24,399 8.6 25,968 24,151 7.5 Reserve
for Loan & Leases Losses (360) (345) 4.3 (358) (345) 3.8
Premises and Equipment, net 435 442 -1.6 437 443 -1.4 Goodwill and
Intangibles 1,167 1,090 7.1 1,138 1,089 4.5 Other Assets 1,591
1,441 10.4 1,564 1,433 9.1 Total Assets $36,172 $33,299 8.6%
$35,508 $32,968 7.7% Memo: Average Earning Assets $32,537 $29,924
$31,940 $29,593 Average Earning Assets Excluding Investment
Securities Unrealized Gains/Losses $32,510 $29,843 $31,885 $29,509
AVG LIABILITIES & SHAREHOLDERS' EQUITY ($millions) Deposits:
Noninterest Bearing $4,514 $4,073 10.8% $4,415 $3,967 11.3% Bank
Issued Interest Bearing Activity 9,995 10,135 -1.4 9,994 10,086
-0.9 Bank Issued Time 3,242 3,419 -5.2 3,242 3,493 -7.2 Total Bank
Issued Deposits 17,751 17,627 0.7 17,651 17,546 0.6 Wholesale
Deposits 5,758 4,515 27.5 5,361 4,101 30.7 Total Deposits 23,509
22,142 6.2 23,012 21,647 6.3 Short - Term Borrowings 3,259 3,204
1.7 3,344 3,406 -1.8 Long - Term Borrowings 4,704 3,700 27.1 4,473
3,699 20.9 Other Liabilities 1,294 1,053 22.9 1,289 1,066 20.9
Shareholders' Equity 3,406 3,200 6.4 3,390 3,150 7.6 Total
Liabilities & Shareholders' Equity $36,172 $33,299 8.6% $35,508
$32,968 7.7% Memo: Average Interest Bearing Liabilities $26,958
$24,973 $26,414 $24,785 M&I Corporation Financial Information
(unaudited) Three Months Ended Six Months Ended June 30, June 30,
Percent June 30, June 30, Percent 2004 2003 Change 2004 2003 Change
CREDIT QUALITY(a) Net Charge-Offs ($millions) $5.0 $9.8 -49.0% $9.9
$35.6 -72.2% Net Charge-Offs / Average Loans & Leases 0.08%
0.16% 0.08% 0.30% Loan and Lease Loss Reserve ($millions) $357.9
$348.1 2.8% $357.9 $348.1 2.8% Loan and Lease Loss Reserve /
Period-End Loans & Leases 1.32% 1.40% 1.32% 1.40%
Non-Performing Loans & Leases (NPL)($millions) $145.0 $203.3
-28.7% $145.0 $203.3 -28.7% NPL's / Period-End Loans & Leases
0.53% 0.82% 0.53% 0.82% Loan and Lease Loss Reserve /
Non-Performing Loans & Leases 247% 171% 247% 171% MARGIN
ANALYSIS(b) Loans and Leases: Commercial Loans & Leases 4.62%
4.68% 4.64% 4.69% Commercial Real Estate 5.34 5.75 5.35 5.86
Residential Real Estate 5.42 6.07 5.49 6.23 Home Equity Loans and
Lines 5.24 5.81 5.29 5.88 Personal Loans and Leases 5.00 5.53 5.07
5.64 Total Loans and Leases 5.09 5.45 5.13 5.53 Investment
Securities 4.87 4.92 4.93 5.21 Short - Term Investments 0.99 1.00
1.04 1.08 Interest Income(FTE) / Avg. Interest Earning Assets 5.03%
5.31% 5.07% 5.43% Interest Bearing Deposits: Bank Issued Interest
Bearing Activity 0.64% 0.82% 0.63% 0.86% Bank Issued Time 2.38 2.54
2.38 2.62 Total Bank Issued Deposits 1.06 1.25 1.06 1.31 Wholesale
Deposits 1.61 1.60 1.64 1.71 Total Interest Bearing Deposits 1.23
1.34 1.23 1.40 Short - Term Borrowings 1.76 2.63 1.81 2.55 Long -
Term Borrowings 3.62 4.58 3.66 4.61 Interest Expense / Avg.
Interest Bearing Liabilities 1.71% 1.98% 1.71% 2.04% Net Interest
Margin(FTE) / Avg. Earning Assets 3.61% 3.65% 3.65% 3.72% Interest
Spread (FTE) 3.32% 3.33% 3.36% 3.39% Notes: (a) Includes Loans past
due 90 days or more (b) Based on average balances excluding fair
value adjustments for available for sale securities. Reconciliation
of Income as Adjusted to Net Income Income as Adjusted $151.7
$134.7 $297.8 $264.2 Acquisition and Transition Related Charges -
Metavante 0.0 0.0 0.0 (1.5) Net Income $151.7 $134.7 $297.8 $262.7
DATASOURCE: Marshall & Ilsley Corporation CONTACT: Mark
Furlong, executive vice president and chief financial officer,
+1-414-765-8052, or Don Wilson, senior vice president, corporate
treasurer, +1-414-765-8043, both of Marshall & Ilsley
Corporation Web site: http://www.micorp.com/
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