GREENSBURG - Archie M. Brown, Jr., President and Chief Executive Officer of MainSource Financial Group, Inc. (NASDAQ: MSFG), announced today the unaudited financial results for the first quarter of 2014. For the three months ended March 31, 2014, the Company recorded net income of $6.2 million, or $0.30 per common share, compared to net income of $4.0 million, or $0.19 per common share, in the first quarter of 2013. During the first quarter of 2014 the Company announced plans to close three banking offices and incurred $600 thousand in costs related to the closures. This reduced earnings per share by $0.02 during the quarter. During the first quarter of 2013, the Company prepaid a $15 million Federal Home Loan Bank (FHLB) advance and incurred a $2.2 million prepayment penalty. This reduced earnings per share during the first quarter of 2013 by $0.07.
Mr. Brown stated, “I am pleased with our first quarter’s results. Our earnings per share (after adjusting for non-operating items) were $.32 per share compared to $.26 per share one year ago, a 23% increase. The primary drivers of improvement were lower provision expense and lower marketing and collection expenses.”
Mr. Brown continued, “I am also pleased with our improving trends in net interest income, driven by a 9% increase in loan balances from one year ago. I am also encouraged that our fee income was down only 3% from one year ago despite the fact that mortgage income declined by 35%. Increases in trust and investment fees, service charges, interchange income and lower losses on the sale of OREO, all helped offset the decline in mortgage income. During the quarter, we increased our mortgage loan origination staff by over 20% as we work to increase mortgage originations from the realtor community”.
Mr. Brown discussed loan trends, “While loans increased approximately 9% from one year ago, balances grew at a much lower pace on a linked quarter basis, about 4% annualized. We did originate approximately $23 million in construction loans during the quarter with about $3 million drawn on these loans. We anticipate that draws on these loans will help fuel growth in the second and third quarters of 2014. In addition, our new Louisville commercial banking team and our new equipment finance team are now building loan pipelines. At quarter-end, overall loan pipelines were strong. We anticipate improving trends throughout the remainder of the year.”
Mr. Brown concluded by commenting on the recently announced agreement to acquire The Merchants Bank and Trust Company, of West Harrison, Indiana, “We are very excited to partner with Merchants Bank as the combination will significantly strengthen our market share in Dearborn County and provide momentum to our recently opened Cincinnati loan production office by adding three offices in Hamilton County, Ohio (Cincinnati).”
— Daily News