Park Sterling Corporation Announces Second Quarter 2012 Results

CHARLOTTE, N.C., July 26, 2012 (GLOBE NEWSWIRE) -- Park Sterling Corporation (Nasdaq:PSTB), the holding company for Park Sterling Bank, today released unaudited results of operations and other financial information for the second quarter of 2012. Highlights for the quarter compared to the three months and period ended March 31, 2012 include:

• Reported net income of $678,000, or $0.02 per share
• Increased non-acquired loan portfolio $15.5 million, or 4%, to $402.4 million
• Increased noninterest income, excluding gain on sale of securities, $148,000, or 8%, to $2.1 million
• Decreased nonperforming loans $1.5 million, or 7%, to 2.85% of total loans
• Decreased nonperforming assets $3.5 million, or 9%, to 3.13% of total assets
• Maintained strong capitalization, with tangible common equity to tangible assets of 17.02%
• Entered into definitive merger agreement with Citizens South Banking Corporation

"Park Sterling's second quarter was marked by a return to net loan growth in our metro markets, continued improvement in asset quality and continued profitability," said James C. Cherry, Chief Executive Officer. "We reported net income of $678,000, or $0.02 per share, for the quarter, compared to net income of $1.7 million, or $0.05 per share, in the first quarter. The decrease from the prior period resulted primarily from quarter-to-quarter fluctuations associated with both acquired loan accounting and cyclical loan collection and OREO expenses, which were partially offset by a gain on the sale of securities. We are very pleased with the company's financial results for both the quarter and the first six months of the year.

We are particularly pleased that each of our metro markets, as well as our asset-based lending team, was able to generate net loan growth this quarter despite what appears to be a continued deleveraging trend among borrowers. Our origination efforts also remain somewhat tempered by increasingly aggressive rates and term structures available in our markets. This aggressive environment, however, has contributed to our remediating problem assets more quickly than originally anticipated as a result of the refinancing options available to borrowers, as evidenced by the improvement in both nonperforming loans and nonperforming assets during the quarter. Other measures of asset quality also improved during the period and, assuming we do not experience a "double-dip" recession, we expect asset quality, in general, to either remain stable or improve throughout the remainder of the year.

Finally, let me again share my excitement about Park Sterling's proposed merger with Citizens South. Our combined management team is working extremely well together towards closing the transaction so that we can then focus on building the premier community bank in the Charlotte-Gastonia-Rock Hill MSA, and expanding our growing presence in other attractive markets across the Carolinas and North Georgia. Our integration teams are working diligently to ensure we meet our merger timeframes and objectives. Efforts to date have included filing a preliminary joint proxy statement and prospectus with the Securities and Exchange Commission, filing applications for approval of both the holding company merger and the subsidiary bank merger with the appropriate federal and state regulators, and working toward completion of our integration plans. This work has reinforced our belief in the strong business and cultural fits between our two companies. We remain confident, subject to receipt of applicable regulatory and shareholder approvals, that this transformational partnership will be positive for our shareholders, customers, communities and employees."

Second Quarter 2012 Financial Results

Net Income (Loss)

Three Month Results

Park Sterling reported net income of $678,000, or $0.02 per share, for the three months ended June 30, 2012. This compares to net income of $1.7 million, or $0.05 per share, for the three months ended March 31, 2012 and a net loss of $3.1 million, or $0.11 per share, for the three months ended June 30, 2011. The decrease in net income from the prior quarter primarily reflects quarter-to-quarter fluctuations both from accounting for acquired loans and from expenses associated with problem assets, partially offset by a gain on the sale of securities. The increase in net income from the prior year resulted primarily from the inclusion of Community Capital Corporation ("Community Capital"), which was merged into Park Sterling in the fourth quarter of 2011, and the company's organic growth initiatives. 

Net interest income totaled $10.1 million for the three months ended June 30, 2012, which represented a $1.6 million, or 14%, decrease from the first quarter of 2012 and a $6.3 million, or 168%, increase from the second quarter of 2011. The decrease from the three months ended March 31, 2012 resulted from a $1.7 million, or 14%, decline in interest income from loans, which more than offset improved funding costs. The largest contributor to this drop in loan interest income was lower accelerated accretion from credit and interest rate marks associated with acquisition accounting adjustments for performing acquired loans, as accounted for under the contractual cash flow method of accounting. Accelerated mark accretion decreased $1.2 million, or 81%, for the three months ended June 30, 2012 compared to the three months ended March 31, 2012. The higher accelerated accretion in the first quarter of 2012 resulted from more borrowers repaying loans faster than required by their contractual terms and/or restructuring loans in such a way as to effectively result in a new loan under the contractual cash flow method of accounting, both of which result in the associated remaining credit and interest rate marks being fully accreted into interest income. The increase in net interest income from the three months ended June 30, 2011 was due to higher average earning balances and net interest margin resulting from the merger with Community Capital and the company's organic growth initiatives.   

Net interest margin was 4.01% in the second quarter of 2012, representing a 64 basis point decrease from 4.65% in the first quarter of 2012 and a 141 basis point improvement from 2.60% in the second quarter of 2011. The decrease in accelerated accretion accounted for 48 basis points, or 75%, of the total decline in net interest margin compared to the first quarter of 2012. A decrease in yields on investments and expected contraction in normal accretion from acquired loans accounted for the remaining difference. The increase in net interest margin from the second quarter of 2011 reflects the inclusion of higher rate loans acquired in the Community Capital merger, normal accretion from credit and interest rate marks associated with acquisition accounting adjustments, and reduced funding costs due, primarily, to lower pricing on interest bearing deposits and improved deposit mix. Excluding the effects of accelerated accretion, net interest margin was 3.90% for the three months ended June 30, 2012, compared to 4.07% for the three months ended March 31, 2012 and compared to 2.60% for the three months ended June 30, 2011.

Provision for loan losses was $899,000 for the three months ended June 30, 2012, compared to $123,000 in the first quarter of 2012 and $3.2 million in the second quarter of 2011. The increase from the first quarter included $450,000 of provision expense associated with acquired loans, comprised of a $195,000 specific reserve associated with an acquired performing loan and a $255,000 impairment in one of the company's six purchase credit impaired (PCI) loan pools. This impairment occurred despite an overall increase in expected cash flows associated with PCI loans of $5.1 million during the quarter. The decrease in provision expense from the second quarter of 2011 resulted from improvement in asset quality.

Noninterest income increased $637,000, or 33%, from the first quarter of 2012 to $2.6 million for the three months ended June 30, 2012. This increase included a $489,000 gain on the sale of securities, which partially offset merger-related expenses, volatility from acquired loan accounting and cyclical loan collection and OREO expenses. Excluding the gain on sale of securities, noninterest income increased $148,000, or 8%, to $2.1 million in the second quarter of 2012 compared to the first quarter of 2012. This improvement in core operations reflects continued strength in both the company's mortgage operations, which reported a $79,000, or 17%, increase in revenues to $540,000, and its wealth management activities, which reported a $62,000, or 10%, increase in revenues to $661,000. Noninterest income was a modest $44,000 for the three months ended June 30, 2011 due to the company's more limited product capabilities prior to the merger with Community Capital. 

Noninterest expenses totaled $10.9 million for the second quarter of 2012, which represented a $140,000, or 1%, decrease compared to $11.0 million for the first quarter of 2012 and a $5.4 million, or 98%, increase compared to $5.5 million for the second quarter of 2011. Excluding merger-related expenses of $434,000 and $930,000, respectively, noninterest expenses increased $356,000, or 4%, to $10.4 million for the three months ended June 30, 2012, compared to $10.1 million for the three months ended March 31, 2012. This increase resulted primarily from cyclical loan collection and OREO expenses, which together grew $338,000, or 44%, to $1.1 million in the second quarter of 2012, compared to $766,000 in the first quarter of 2012. Data processing and service fees, occupancy and equipment, and other expenses also increased during the second quarter, but were generally offset by a decrease in personnel expenses. The increase in noninterest expense from the second quarter of 2011 resulted from the merger with Community Capital and the company's growth initiatives.         

Six Month Results

Park Sterling reported net income of $2.4 million, or $0.07 per share, for the six months ended June 30, 2012 compared to a net loss of $6.0 million, or $0.21 per share, for the six months ended June 30, 2011. Net interest income increased $14.1 million, or 182%, to $21.8 million as a result of higher earning assets and improved margins resulting from the merger with Community Capital and the company's growth initiatives. Provision expense decreased $6.7 million, or 87%, to $1.0 million as a result of improved asset quality. Noninterest income increased from $116,000 to $4.5 million as a result of new product capabilities from the merger with Community Capital. Noninterest expense increased from $9.7 million to $21.9 million due to the merger with Community Capital, the company's growth initiatives and increased OREO expenses. 

Balance Sheet and Capital

Linked-Quarter Comparisons

Total assets decreased $11.6 million, or 1%, to $1.1 billion at June 30, 2012 compared to the total assets at March 31, 2012. Cash and investments increased $11.2 million, or 4%, to $297.4 million as a result of cash generated during the second quarter from declining loan balances. Total loans, which exclude loans held for sale, decreased $15.4 million, or 2%, to $712.5 million at June 30, 2012. This decrease included a $30.9 million, or 9%, reduction in acquired loans to $310.1 million, which was partially offset by a $15.5 million, or 4%, increase in non-acquired loans to $402.4 million. The decrease in acquired loans reflects both targeted reductions by the company and repayments resulting from improved borrower conditions. The net increase in non-acquired loans was driven by both new loan originations and transfers from performing acquired loan pools (due to restructurings). New loan origination remains somewhat tempered as a result of aggressive competition in the market with respect to interest rate and term structures. However, the company posted net loan growth in each of its metropolitan markets of Charlotte, Raleigh and Wilmington, North Carolina, and Greenville and Charleston, South Carolina, as well as in its asset-based lending group, during the second quarter, excluding loans managed in the company's special assets group.    

Loan mix shifted modestly during the second quarter. The combination of commercial and industrial and owner-occupied real estate loans decreased $8.9 million, or 4%, to $229.3 million, due to lower usage under lines of credit and aggressive competition for owner-occupied loans. This component of the portfolio represented 32.2% of total loans at June 30, 2012 compared to 32.7% at March 31, 2012. Investor owned real estate loans increased $3.7 million, or 2%, to $197.4 million, and represented 27.7% of total loans at June 30, 2012 compared to 26.6% at March 31, 2012. Construction and development loans increased $436,000 to $112.2 million, due to non-speculative origination activity, and represented 15.7% of total loans at June 30, 2012 compared to 15.4% at March 31, 2012. Home equity lines of credit decreased $2.4 million, or 3%, to $83.7 million during the second quarter, due in part to lower usage, and represented 11.7% of total loans at June 30, 2012 compared to 11.8% at March 31, 2012. Finally, 1-4 family loans decreased $8.5 million, or 11%, to $66.9 million, as the company deemphasized balance sheet mortgage products and remediated problem assets, and represented 9.4% of total loans compared to 10.4% in the prior quarter.   

Total deposits decreased $14.4 million, or 2%, during the second quarter to $842.0 million, reflecting lower funding needs. Deposit mix continued to improve.  Demand deposits increased $9.9 million, or 7%, during the second quarter due primarily to continued emphasis in this area and represented 18.9% of total deposits at June 30, 2012, compared to 17.4% at March 31, 2012. Money market, NOW and savings deposits increased $3.0 million, or 1%, during the second quarter and represented 39.5% of total deposits at June 30, 2012 compared to 38.5% at March 31, 2012. Non-brokered time deposits decreased $14.4 million, or 6%, during the second quarter due primarily to re-pricing strategies intended to enhance profitability. As a result, non-brokered time deposits declined to 24.9% of total deposits at June 30, 2012 from 26.2% at March 31, 2012. Finally, brokered deposits decreased $12.9 million, or 8%, to $140.5 at June 30, 2012 million due to lower funding needs. Brokered deposits represented 16.7% of total deposits at June 30, 2012, compared to 17.9% at March 31, 2012.

Modestly higher short-term borrowings led to a $924,000, or 1%, increase in total funded debt to $69.2 million at June 30, 2012, compared to $68.2 million at March 31, 2012. Borrowings currently include $5.6 million of Tier 1-eligible subordinated debt and $6.9 million of Tier 2-eligible subordinated debt. Shareholders' equity increased $1.4 million, or 1%, to $194.2 million at June 30, 2012. Tangible common equity as a percentage of tangible assets remained very strong at 17.02%. Tier 1 leverage ratio also remained very strong at 14.92%. 

Prior Year Comparisons

Total assets increased $508.5 million, or 83%, to $1.1 billion at June 30, 2012, compared to $610.7 million at June 30, 2011. This increase reflects both the merger with Community Capital and the company's organic growth initiatives. Cash and investments increased $83.7 million, or 39%, and total loans increased $332.1 million, or 87%, net of acquisition accounting fair market value adjustments, compared to the prior year period. Loan mix improved over the twelve months, with exposure to construction and development loans declining from 18.6% of total loans at June 30, 2011 to 15.7% of total loans at June 30, 2012. In addition, from June 30, 2011 to June 30, 2012, the combination of commercial and industrial and owner-occupied real estate increased from 29.2% to 32.2% of total loans, 1-4 family increased from 5.7% to 9.4% of total loans, and HELOC decreased from 14.8% to 11.7% of total loans.  

Total deposits increased $438.1 million, or 108%, to $842.0 million at June 30, 2011, compared to $403.9 million at June 30, 2011. This increase reflects both the merger with Community Capital and the company's organic growth initiatives. Deposit mix improved over the prior twelve months, with demand deposits increasing from 10.4% to 18.9% of total deposits, MMDA, NOW and savings increasing from 27.5% to 39.5% of total deposits, and brokered deposits decreasing from 23.7% of total deposits at June 30, 2011 to 16.7% of total deposits at June 30, 2012.  

Total borrowings increased $40.6 million, or 142%, to $69.2 million at June 30, 2012, compared to $28.6 million at June 30, 2011 due to the assumption of debt, net of acquisition accounting fair market value adjustments, at Community Capital. Shareholders' equity increased $20.6 million, or 12%, to $194.2 million due primarily to the issuance of 4,024,269 shares as consideration in the Community Capital merger, which represented approximately $15.5 million of equity capital.

Asset Quality

Asset quality continued to improve during the second quarter of 2012, reflecting stabilizing economic conditions in the company's markets, continued management focus on problem assets and continued discipline in the origination of new loans.  Pass grade loans increased to 94.0% of total loans (excluding loans held for sale and deferred fees) at June 30, 2012, up from 92.6% at March 31, 2012 and 83.0% at June 30, 2011. Nonperforming loans decreased $1.5 million, or 7%, during the second quarter, to $20.3 million, or 2.85% of total loans, at June 30, 2012. This compares to 3.00% of total loans at March 31, 2012 and 7.25% of total loans at June 30, 2011. Nonperforming assets decreased $3.5 million, or 9%, during the second quarter, to $35.1 million and represented 3.13% of total assets at June 30, 2012. This compares to 3.41% of total assets at March 31, 2012 and 5.34% of total assets at June 30, 2011. Within nonperforming assets, OREO decreased $1.9 million, or 12%, to $14.7 million during the second quarter as sales of properties outpaced new foreclosures.  

Net charge-offs increased $303,000, or 42%, to $1.0 million in the second quarter of 2012, representing 0.56% of average loans (annualized). This compares to net charge-offs of $721,000, or 0.39% of average loans (annualized) in the first quarter of 2012, and compares to net charge-offs of $3.7 million, or 3.87% of total loans (annualized) in the second quarter of 2011. The allowance for loan losses was $9.4 million, or 1.32% of total loans at June 30, 2012. This compares to $9.6 million, or 1.31% of total loans, at March 31, 2012, and $11.3 million, or 2.96% of total loans, at June 30, 2011. The reduction in the total allowance at June 30, 2012 reflects the overall decline in total loans during the second quarter, while the slight increase in the allowance percentage reflects the provision expense driven by the accounting for acquired loans. Adjusting for acquired loans, the allowance for loan losses represented 2.23% of non-acquired loans at June 30, 2012, compared to 2.47% of non-acquired loans at March 31, 2012. 

During the first quarter of 2011, and as contemplated in the 2010 equity offering, 568,260 shares of restricted stock were issued but will not vest until the company's share price achieves certain performance thresholds above the equity offering price (these restricted stock awards vest one-third each at $8.125, $9.10 and $10.40 per share, respectively). Accordingly, these additional shares have been excluded from earnings and tangible book value per share calculations.

Conference Call

A conference call will be held at 8:30 a.m., Eastern Time this morning (July 26, 2012). The conference call can be accessed by dialing (877) 317-6789 and requesting the Park Sterling Corporation earnings call. Listeners should dial in 10 minutes prior to the start of the call. The live webcast and presentation slides will be available on www.parksterlingbank.com under Investor Relations, "Investor Presentations."

A replay of the webcast will be available on www.parksterlingbank.com under Investor Relations, "Investor Presentations" shortly following the call. A replay of the conference call can be accessed one hour after the call by dialing (877) 344-7529 and requesting conference number 10016673.

About Park Sterling Corporation

Park Sterling Corporation is the holding company for Park Sterling Bank, headquartered in Charlotte, North Carolina. Park Sterling's primary focus is to provide financial services to small and mid-sized businesses, owner-occupied and income producing real estate owners, professionals and consumers doing business or residing within its target markets. Park Sterling offers a full array of banking services, including a diverse wealth management group. Park Sterling is focused on building a banking franchise across the Carolinas and Virginia that is noted for sound risk management, superior customer service and exceptional client relationships. For more information, visit www.parksterlingbank.com. Park Sterling's shares are traded on NASDAQ under the symbol PSTB.

Non-GAAP Measures

Tangible assets, tangible common equity, tangible book value, net interest margin excluding the effects of accelerated mark accretion, noninterest expense excluding merger-related expenses, noninterest income excluding the gain on sale of securities, asset quality measures excluding the effects of acquired loans, and related ratios and per share measures, as used throughout this release, are non-GAAP financial measures. Management uses tangible assets, tangible common equity and tangible book value and related ratios to evaluate the adequacy of shareholders' equity and to facilitate comparisons with peers; asset quality measures excluding the effects of acquired loans to evaluate both its asset quality and asset quality trends, and to facilitate comparisons with peers; and noninterest expense excluding merger-related expenses, noninterest income excluding gain on sale of securities and net interest margin excluding the effects of accelerated mark accretion to evaluate core earnings (loss). For additional information, see "Reconciliation of Non-GAAP Measures" in the accompanying tables.

Cautionary Statement Regarding Forward Looking Statements

This news release contains, and Park Sterling and its management may make, certain statements that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts and often use words such as "may," "plan," "contemplate," "anticipate," "believe," "intend," "continue," "expect," "project," "predict," "estimate," "could," "should," "would," "will," "goal," "target" and similar expressions. These forward-looking statements express management's current expectations or forecasts of future events and, by their nature, are subject to risks and uncertainties and there are a number of factors that could cause actual results to differ materially from those in such statements. Factors that might cause such a difference include, but are not limited to: expectations regarding the proposed merger with Citizens South Banking Corporation ("Citizens South"); the general business strategy of engaging in bank mergers, organic growth,  branch openings, expansion or addition of product capabilities, expected footprint of the banking franchise and anticipated asset size; anticipated loan growth; changes in loan mix and deposit mix; capital and liquidity levels; net interest income; credit trends and conditions, including loan losses, allowance for loan loss, charge-offs, delinquency trends and nonperforming asset levels; and other similar matters. These forward-looking statements are not guarantees of future results or performance and by their nature involve certain risks and uncertainties that are based on management's beliefs and assumptions and on the information available to Park Sterling at the time that these disclosures were prepared. Actual outcomes and results may differ materially from those expressed in, or implied by, any of these forward-looking statements.

You should not place undue reliance on any forward-looking statement and should consider all of the following uncertainties and risks, as well as those more fully discussed in any of Park Sterling's filings with the SEC: inability to obtain governmental approvals of the Citizens South merger on the proposed terms and schedule or of the assignment of certain Citizens South FDIC loss-share agreements; failure of Park Sterling's shareholders or Citizens South's stockholders to approve the merger; fluctuation in the trading price of Park Sterling's stock prior to the closing of the proposed merger, which would affect the total value of the proposed merger transaction; failure to realize synergies and other financial benefits from the proposed merger within the expected time frame; increases in expected costs or difficulties related to integration of the Citizens South merger; inability to identify and successfully negotiate and complete additional combinations with potential merger partners or to successfully integrate such businesses into Park Sterling, including the company's ability to realize the benefits and cost savings from and limit any unexpected liabilities acquired as a result of any such business combination; the effects of negative economic conditions or a "double dip" recession, including stress in the commercial real estate markets or delay or failure of recovery in the residential real estate markets; the impact of deterioration of the United States credit standing; changes in consumer and investor confidence and the related impact on financial markets and institutions; changes in interest rates; failure of assumptions underlying the establishment of allowances for loan losses; deterioration in the credit quality of the loan portfolio or in the value of the collateral securing those loans; deterioration in the value of securities held in the investment securities portfolio; legal and regulatory developments; increased competition from both banks and nonbanks; changes in accounting standards, rules and interpretations, inaccurate estimates or assumptions in accounting, including acquisition accounting fair market value assumptions and accounting for purchased credit-impaired loans, and the impact on Park Sterling's financial statements; and management's ability to effectively manage credit risk, market risk, operational risk, legal risk, and regulatory and compliance risk.

Forward-looking statements speak only as of the date they are made, and Park Sterling undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made.

Additional Information About the Merger and Where to Find It

In connection with the proposed merger between Park Sterling and Citizens South Banking Corporation ("Citizens South"), Park Sterling has filed with the Securities and Exchange Commission (the "SEC") a Registration Statement on Form S-4 that includes a preliminary joint proxy statement of Park Sterling and Citizens South that also constitutes a prospectus of Park Sterling, as well as other relevant documents concerning the proposed merger. Once the Registration Statement is declared effective by the SEC, Park Sterling and Citizens South will mail a definitive joint proxy statement/prospectus to their shareholders and stockholders, respectively. INVESTORS ARE STRONGLY URGED TO READ THE REGISTRATION STATEMENT, INCLUDING THE PRELIMINARY JOINT PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED MERGER AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS (INCLUDING THE DEFINITIVE JOINT PROXY STATEMENT/ PROSPECTUS) AS THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION REGARDING THE PROPOSED MERGER. 

A free copy of the preliminary joint proxy statement/prospectus, as well as other filings containing information about Park Sterling and Citizens South, may be obtained after their filing at the SEC's Internet site (http://www.sec.gov). In addition, free copies of documents filed with the SEC may be obtained on the respective websites of Park Sterling and Citizens South at www.parksterlingbank.com and www.citizenssouth.com.

Participants in the Solicitation

Park Sterling and Citizens South and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from Park Sterling's shareholders and Citizens South's stockholders in connection with the proposed merger. Information about the directors and executive officers of Park Sterling and Citizens South and about other persons who may be deemed participants in this solicitation will be included in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed transaction. Information about Park Sterling's executive officers and directors can be found in Park Sterling's definitive proxy statement in connection with its 2012 Annual Meeting of Shareholders filed with the SEC on April 16, 2012. Information about Citizens South's executive officers and directors can be found in Citizens South's definitive proxy statement in connection with its 2012 Annual Meeting of Stockholders filed with the SEC on April 13, 2012. Free copies of these documents can be obtained from the sources indicated above.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, or the solicitation of any proxies from the shareholders of Park Sterling or the stockholders of Citizens South, nor shall there be any offer, solicitation or sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

Non-GAAP Measures

Tangible assets, tangible common equity, tangible book value, net interest margin excluding accelerated mark accretion, noninterest expense excluding merger-related expenses, noninterest expense excluding merger-related expenses, noninterest income excluding gain on sale of securities, total loans excluding acquired loans, allowance measures excluding the effects of acquired loans, and related ratios and per share measures, as used throughout this release, are non-GAAP financial measures. A reconciliation of these non-GAAP measures to the most comparable GAAP measures is provided below.