BANK OF AMERICA EXITS TARP

Charlotte, NC-based, $2.39 trillion-asset Bank of America Corp. (B of A) sent the U.S. Treasury $45 billion last week to repurchase all shares the government had acquired under the Troubled Asset Relief Program (TARP). B of A President and CEO Ken Lewis said of the December 9, 2009 repurchase, “Now that we have cleared this significant hurdle, which demonstrates the strength of our company, we look forward to continuing to play a key role in the economic recovery and helping to meet the challenging needs of our customers and clients.”

WELLS FARGO ACQUIRES TWO MORE AGENCIES

Chicago-based Wells Fargo Insurance Services (WFIS), a unit of San Francisco-based, $1.2 trillion-asset Wells Fargo & Co., has acquired Tampa, FL-based commercial insurance agency iLeader Risk Management Solutions and Mercer Island, WA-based employee benefits agency Orca Bay Benefits. Both agencies will merge into WFIS, which operates 200 offices in 37 states. WFIS President and CEO Neal Aton said, “We will continue this deliberate strategy to seek acquisition opportunities that bring meaningful value to customers and deepen Wells Fargo’s nationwide commitment to insurance brokerage.” In 2008, Wells Fargo & Co. reported $1.6 billion in insurance brokerage income, which comprised 9.8% of its noninterest income. The company ranked first in insurance brokerage earnings among all U.S. bank holding companies (BHCs) engaged in significant banking activities, according to the Michael White-Prudential Bank Insurance Fee Income Report. (These figures do not include results of Wachovia Corporation, which Wells Fargo bought on December 31, 2008, because neither Wachovia nor Wells Fargo filed income statement figures for Wachovia for year-end 2008.)

INSURANCE AT PEOPLES BANCORP (OH) COMPRISES OVER 28% OF NONINTEREST INCOME

Marietta, OH-based, $2 billion-asset Peoples Bancorp reported third-quarter lower property and casualty insurance commissions impacted third quarter insurance brokerage fee income, which decreased 8.6% to $2.23 million, down from $2.44 million in third quarter 2008, but remained the second highest contributor to noninterest income behind deposit and account service charges, comprising 28.3% of noninterest income. Trust and investment income declined 6.3% to $1.19 million, down from $1.27 million to comprise 15.1% of noninterest income, and income from bank-owned life insurance (BOLI) fell 35.0% to $254,000, down from $391,000, to comprise 3.2% of noninterest earnings. Noninterest income, reflecting declines in all sources of noninterest earnings except mortgage banking, slid 3.3% to $7.89 million, down from $8.16 million a year ago. Net interest income on a 3.45% net interest margin fell 38.4% to $5.3 million, down from $8.61 million, as loan loss provisions climbed by $4.17 million to $10.17 million. With an additional $5.93 million in other than temporary impairment losses on investment securities, Peoples reported a third quarter net loss of $4.6 million compared to net income of $3 million a year ago. Peoples Bancorp President and CEO Mark Bradley said, “Our third quarter results were impacted by losses caused by combined weakness in commercial real estate values and the general economy.” In 2008, Peoples Bancorp reported $9.9 million in insurance brokerage income, which comprised 30.1% of its noninterest income. The company ranked 18th in insurance brokerage earnings among U.S. bank holding companies with assets between $1 billion and $10 billion, according to the Michael White-Prudential Bank Insurance Fee Income Report.

FIRST DEFIANCE REPORTS DECLINE IN INSURANCE & INVESTMENT SALES COMMISSIONS

Defiance, OH-based, $2.02 billion-asset First Defiance Financial Corp. reported third-quarter insurance and investment sales commissions slipped 4.2% to $1.13 million, down from $1.18 million in third quarter 2008. Income from bank-owned life insurance (BOLI) dipped 1.03% to $201,000, down from $224,000, and trust income declined 11.4% to $101,000, down from $114,000. Insurance and investment sales commissions, BOLI and trust income comprised respectively, 20.3%, 3.6% and 1.8% of noninterest income, which grew 34.3% to $5.56 million, up from $4.14 million a year ago. Net interest income on a 3.88% net interest margin fell 16.9% to $9.52 million, down from $11.46 million, as loan loss provisions climbed by $3.04 million to $8.05 million. But, net income inched ahead 2.2% to $329,000, up from $322,000 a year ago. First Defiance Chairman, President and CEO William Small said, “The impact of the economic environment continues to be reflected in our results for the third quarter. In light of the continued environment of unemployment, as well as the continued uncertainty of the commercial real estate market, we believe it is prudent to build general reserves.”

INSURANCE, BOLI, TRUST & INVESTMENT MANAGEMENT FEES COMPRISE 21% OF NONINTEREST INCOME AT CITY HOLDING

Charleston, WV-based, $2.6 billion-asset City Holding Company reported new business pushed third quarter insurance commissions up 17.5% to $1.21 million, from $1.03 million in third quarter 2008. Bank-owned life insurance (BOLI) income rose 3.5% to $794,000, up from $767,000. In contrast, trust and investment management fee income fell 7.8% to $590,000, down from $640,000. Insurance brokerage commissions, BOLI income and trust and investment management fees comprised, respectively, 9.8%, 6.4% and 4.8% of $12.34 million in noninterest fee income, which a year ago showed a $12.76 million net loss tied to $27.5 million in securities losses. Net interest income on a 4.09% net interest margin decreased 8.1% to $21.98 million, down from $23.93 million, despite a $675,000 reduction in loan losses to $1.675 million. In contrast to a net loss of $2.6 million a year ago, City Holding reported $10.5 million in third quarter net income. City Holding CEO Charles Hageboeck said, “City continues to be one of the most profitable, most liquid and best capitalized publicly traded banks in the U.S., and we look forward to growing with and for our shareholders and customers.” In 2008, City Holding reported $4.2 million in insurance brokerage income, which comprised 7.1% of its noninterest income. The company ranked 41st in insurance brokerage earnings among U.S. bank holding companies (BHCs) with assets between $1 billion and $10 billion, according to the Michael White-Prudential Bank Insurance Fee Income Report.

INCREASED INSURANCE INCOME AT TOMPKINS FINANCIAL OFFSETS DECLINE IN INVESTMENT SERVICES

Ithaca, NY-based, $3.1 billion-asset Tompkins Financial Corp. reported third-quarter insurance brokerage fee income rose 4.9% to $3.2 million, up from $3.05 million in third quarter 2008, enough to “partially offset declining trends in investment services fees and service charges on deposit accounts, both of which have been impacted by the current weak economic climate,” the company said. Investment services income decreased 5.7% to $3.29 million, down from $3.49 million, and comprised 28.4% of noninterest income, which rose 1.8% to $11.6 million, up from $11.4 million, with insurance earnings comprising 27.6% of that revenue. Net interest income grew 9.5% to $24.65 million, up from $22.52 million, as loan loss provisions increased by $612,000 to $2.127 million, and net income rose 6.6% to $8.5 million, up from $7.9 million a year ago. Tompkins Financial President and CEO Stephen Romaine said, “It is especially rewarding to report on such positive results in today’s difficult economic environment. In addition to our record quarterly earnings, we continue to see solid business growth trends.” In 2008, Tompkins Financial reported $11.6 million in insurance brokerage income, which comprised 25.5% of its noninterest income. The company ranked 15th in insurance brokerage earnings among U.S. bank holding companies (BHCs) with assets between $1 billion and $10 billion, according to the Michael White-Prudential Bank Insurance Fee Income Report.

RENASANT CORP. REPORTS RISING INSURANCE SALES

Tupelo, MS-based, $3.64 billion-asset Renasant Corporation reported insurance commissions and fees in the third quarter rose 3.2% to $949,000, up from $920,000 in third quarter 2008, while trust revenue fell 16.1% to $501,000, down from $597,000. Insurance earnings and trust revenue comprised, respectively, 6.8% and 3.6% of noninterest income, which rose 2.3% to $13.95 million, up from $13.64 million. Net interest income on a 3.22% net interest margin dropped 28.5% to $17.84 million, down from $24.94 million, as provisions for loan losses more than doubled, jumping by $4.35 million to $7.35 million, impacting net income, which dropped 44.0% to $4.23 million, down from $7.56 million a year ago. Renasant Chairman and CEO E. Robinson McGraw said, “Based on our concerns with the economy and our volume of past due loans, we continued to increase our allowance for loan losses. This is consistent with our historical practice of providing for losses in our loan portfolio as we identify potential weaknesses.” In 2008, Renasant Corporation reported $3.9 million in insurance brokerage income, which comprised 7.4% of its noninterest income. The company ranked 43rd in insurance brokerage earnings among U.S. bank holding companies (BHCs) with assets between $1 billion and $10 billion, according to the Michael White-Prudential Bank Insurance Fee Income Report.