<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
--- AND EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
---------------------------------------------
OR
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________
Commission File Number 0-8467
---------
WESBANCO, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
West Virginia 55-0571723
- ------------------------------- -----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1 Bank Plaza, Wheeling, WV 26003
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
304-234-9000
----------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
----------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or, for such shorter
period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No ___
---
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date. WesBanco had
20,886,408 shares outstanding at April 30, 1998.
<PAGE> 2
PART 1 - FINANCIAL INFORMATION
- -------------------------------
Consolidated Balance Sheets at March 31, 1998 and December 31, 1997,
and Consolidated Statemets of Income, Consolidated Statements of Changes in
Shareholders' Equity and Consolidated Statements of Cash Flows for the three
months ended March 31, 1998 and 1997 are set forth on the following pages. On
March 31, 1998, WesBanco consummated its business combination with Commercial
BancShares. All previously presented financial information has been restated
to include Commercial BancShares. For further information see Footnote 2.
In the opinion of management of the Registrant, all adjustments,
consisting of normal recurring accruals, necessary for a fair presentation of
the financial information referred to above for such periods, have been made.
The results of operations for the three months ended March 31, 1998 are not
necessarily indicative of what results may be attained for the entire year.
For further information, refer to the 1997 Annual Report to
Shareholders which includes consolidated financial statements and footnotes
thereto and WesBanco, Inc.'s Annual Report on Form 10-K for the year ended
December 31, 1997.
<PAGE> 3
WESBANCO, INC.
CONSOLIDATED BALANCE SHEET
- ------------------------------------------------------------------------------
(Unaudited, dollars in thousands, except per share amounts)
March 31, December 31,
1998 1997
--------- ------------
ASSETS
Cash and due from banks $ 63,133 $ 73,412
Due from banks - interest bearing 6,541 1,515
Federal funds sold 60,450 86,363
Securities:
Available for sale, carried at market value 471,834 383,010
Held to maturity (market value of $252,952
and $249,165, respectively) 248,435 246,208
---------- ---------
Total securities 720,269 629,218
---------- ---------
Loans (net of unearned income of $1,109 and
$1,495, respectively) 1,347,159 1,341,901
Allowance for loan losses (20,225) (20,261)
---------- ---------
Net loans 1,326,934 1,321,640
---------- ---------
Bank premises and equipment - net 46,263 45,068
Accrued interest receivable 18,340 15,579
Other assets 38,811 38,748
---------- ----------
Total Assets $2,280,741 $2,211,543
========== ==========
LIABILITIES
Deposits:
Non-interest bearing demand $ 219,638 $ 205,399
Interest bearing demand 464,716 432,050
Savings 367,041 366,572
Certificates of deposit 790,612 775,846
---------- ----------
Total deposits 1,842,007 1,779,867
---------- ----------
Federal funds purchased and repurchase agreements 89,463 93,342
Other short-term borrowings 30,213 26,927
Accrued interest payable 7,270 7,224
Other liabilities 18,227 16,188
---------- ----------
Total Liabilities 1,987,180 1,923,548
---------- ----------
SHAREHOLDERS' EQUITY
Preferred stock, no par value, 1,000,000 shares
authorized; none outstanding - -
Common stock, $2.0833 par value; 25,000,000
shares authorized; 20,997,093 and 20,666,185
shares issued, respectively 43,743 43,055
Capital surplus 60,631 57,997
Retained earnings 190,633 187,424
Treasury stock at cost(107,686 and 56,381
shares, respectively) (3,261) (1,675)
Other comprehensive income (market value adjustment) 2,406 1,783
Deferred benefits for employees and directors (591) (589)
---------- ----------
Total Shareholders' Equity 293,561 287,995
---------- ----------
Total Liabilities and Shareholders' Equity $2,280,741 $2,211,543
========== ==========
The accompanying Notes to Consolidated Financial Statements are an integral
part of these financial statements.
<PAGE> 4
WESBANCO, INC.
CONSOLIDATED STATEMENT OF INCOME*
- ------------------------------------------------------------------------------
(Unaudited, dollars in thousands, except per share amounts)
For the three months ended
March 31,
--------------------------
1998 1997
INTEREST INCOME ----------- ----------
Interest and fees on loans $ 29,650 $ 28,938
Interest on investment securities:
Taxable 7,709 6,529
Tax-exempt 2,308 2,277
---------- ----------
Total investment income 10,017 8,806
Other interest income 1,023 341
---------- ----------
Total interest income 40,690 38,085
---------- ----------
INTEREST EXPENSE
Interest on deposits 17,189 15,379
Interest on other borrowings 1,406 1,087
---------- ----------
Total interest expense 18,595 16,466
Net interest income 22,095 21,619
Provision for loan losses 753 1,211
---------- ----------
Net interest income after provision for loan losses 21,342 20,408
---------- ----------
OTHER INCOME
Trust fees 2,424 1,876
Service charges and other income 2,436 2,113
Net securities gains 275 4
---------- ----------
Total other income 5,135 3,993
OTHER EXPENSES
Salaries, wages and employee benefits 8,843 8,240
Premises and equipment - net 2,294 2,321
Other operating 5,038 4,661
---------- ----------
Total other expenses 16,175 15,222
---------- ----------
Income before provision for income taxes 10,302 9,179
Provision for income taxes 3,260 2,580
---------- ----------
Net Income $ 7,042 $ 6,599
========== ==========
Earnings per share $0.34 $0.32
Average shares outstanding 20,901,998 20,345,624
Dividends per share $0.21 $0.19
* The Consolidated Statement of Income was unchanged by the adoption
of SFAS No. 130.
The accompanying Notes to Consolidated Financial Statements are an integral
part of these financial statements.
<PAGE> 5
WESBANCO, INC.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
- ------------------------------------------------------------------------------
(Unaudited, in thousands, except for shares)
<TABLE>
Deferred
Other Benefits for
Comprehensive Common Capital Retained Treasury Comprehensive Directors &
Income Stock Surplus Earnings Stock Income Employees Total
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
December 31, 1996 $31,545 $50,512 $187,777 ($544) $46 ($855) $268,481
- ------------------------------------------------------------------------------------------------------------------
Net income $25,211 25,211 25,211
Cash dividends:
Common (.78 per share) (12,474) (12,474)
Common by pooled bank
prior to acquisition (1,929) (1,929)
Stock issued for acquisition 366 7,519 4,901 12,786
Net treasury shares purchased 82 (6,032) (5,950)
Retirement of pooled bank stock
held by WesBanco (17) (116) (133)
Stock issued for a 3 for 2 stock
split effected in the form of a
50% stock dividend 11,161 (11,161)
Deferred benefits for directors (50) (50)
Principal payment on ESOP debt 450 450
ESOP borrowing (134) (134)
Market value adjustment on
investments available for
sale-net of tax 1,737 1,737 1,737
-------
Comprehensive income $26,948
=======
- ------------------------------------------------------------------------------------------------------------------
December 31, 1997 $43,055 $57,997 $187,424 ($1,675) $1,783 ($589) $287,995
- ------------------------------------------------------------------------------------------------------------------
Net income 7,042 7,042 7,042
Cash dividends:
Common (.21 per share) (3,348) (3,348)
Common by pooled bank
prior to acquisition (485) (485)
Stock issued for acquisition 688 2,613 3,301
Net treasury shares purchased 21 (1,586) (1,565)
Deferred benefits for directors (2) (2)
Market value adjustment on
investments available for
sale-net of tax 623 623 623
------
Comprehensive income $7,665
======
- ------------------------------------------------------------------------------------------------------------------
March 31, 1998 $43,743 $60,631 $190,633 ($3,261) $2,406 ($591) $293,561
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying Notes to Consolidated Financial Statements are an integral
part of these financial statements.
<PAGE> 6
WESBANCO, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
- ------------------------------------------------------------------------------
Increase (Decrease) in Cash and Cash Equivalents (unaudited, in thousands)
For the three months ended
March 31,
--------------------------
1998 1997
------------- ----------
Cash flows from operating activities:
Net Income $7,042 $6,599
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 1,467 1,706
Provision for loan losses 753 1,211
Gains on sales of securities-net (275) (4)
Deferred income taxes 179 (14)
Other -- net 223 (164)
Net change in assets and liabilities:
Interest receivable (2,613) (870)
Other assets 439 957
Interest payable (12) 104
Other liabilities 933 2,733
-------- --------
Net cash provided by operating activities 8,136 12,258
-------- --------
Cash flows from investing activities:
Securities held to maturity:
Proceeds from maturities and calls 10,977 31,419
Payments for purchases (8,272) (12,171)
Securities available for sale:
Proceeds from sales 11,058 500
Proceeds from maturities and calls 33,344 20,053
Payments for purchases (134,620) (27,019)
Purchase of subsidiary, net of cash acquired 5,137 -
Net decrease in loans 15,203 106
Purchases of premises and equipment-net (1,753) (2,260)
--------- ---------
Net cash provided by (used in) investing activities (68,926) 10,628
--------- ---------
Cash flows from financing activities:
Net increase in deposits 35,470 20,032
Decrease in federal funds purchased and
repurchase agreements (3,879) (5,032)
Increase (decrease) in short-term borrowings 3,286 (88)
Dividends paid (3,688) (3,312)
Purchases of treasury shares-net (1,565) (3,101)
--------- ---------
Net cash provided by financing activities 29,624 8,499
--------- ---------
Net increase (decrease) in cash and cash equivalents (31,166) 31,385
Cash and cash equivalents at beginning of period 161,290 94,266
--------- ---------
Cash and cash equivalents at end of period $130,124 $125,651
========= =========
For the three months ended March 31, 1998 and 1997, WesBanco paid $18,404 and
$15,427 in interest on deposits and other borrowings, and $143 and $17 for
income taxes, respectively.
The accompanying Notes to Consolidated Financial Statements are an integral
part of these financial statements.
<PAGE> 7
WESBANCO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
Note 1 - Accounting policies
- ----------------------------
Basis of presentation: The accompanying unaudited consolidated financial
statements have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. The consolidated financial
statements include the accounts of WesBanco, Inc. ("the Corporation") and its
wholly-owned subsidiaries. Significant intercompany transactions have been
eliminated in consolidation. Previously presented financial information has
been restated to include Commercial BancShares, Incorporated ("Commercial").
Reclassification: Certain prior year financial information has been
reclassified to conform to the March 31, 1998 presentation. The
reclassifications had no effect on net income.
Cash and cash equivalents: For the purpose of reporting cash flows, cash and
cash equivalents include cash and due from banks, due from banks - interest
bearing and federal funds sold. Generally, federal funds are sold for one-day
periods.
New accounting standards: On January 1, 1998, the Corporation adopted SFAS
No. 130, "Reporting Comprehensive Income". Adoption of the standard is
reflected in the Consolidated Statement of Changes in Shareholders' Equity.
Sources of comprehensive income not included in net income are limited to
unrealized gains and losses on certain investments in debt and equity
securities.
Note 2 - Completed business combinations
- ----------------------------------------
On March 31, 1998, WesBanco and Commercial jointly announced the
consummation of the business combination of Commercial with and into WesBanco
affiliated companies. As of the consummation date, Commercial reported total
assets of approximately $466.1 million and shareholders' equity of $46.4
million. The transaction was accounted for as a pooling-of-interests. In
connection with this transaction, the Corporation issued 4,925,042 shares of
common stock.
On March 9, 1998, Commerical consummated its business combination
with Gateway Bancshares. Gateway, with total assets of $31.0 million, total
loans of $21.8 million and deposits of $26.7 million, was considered
immaterial to the financial position and results of operations of WesBanco
and, therefore, prior year financial information was not restated.
<PAGE> 8
Note 3 - Divestiture
- --------------------
On March 19, 1998, WesBanco and Hometown Bancshares, Inc. ("Hometown")
announced the execution of a Stock Purchase Agreement, providing for Hometown
to purchase the Union Bank of Tyler County, a subsidiary of WesBanco.
According to the Agreement, the transaction will be structured as a purchase
of stock from WesBanco whereby Hometown will acquire 100% of the capital stock
of Union at a total purchase price of $9.6 million. Net assets of the Union
Bank of Tyler County at March 31, 1998 were $4.9 million. The transaction,
which was a condition of regulatory approval for the Commercial combination,
is expected to be completed during the second quarter of 1998.
<PAGE> 9
WESBANCO, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
- ------------------------------------------------------------------------------
The following discussion and analysis presents in further detail the
financial condition and results of operations of WesBanco, Inc. and its
subsidiaries. This discussion and analysis should be read in conjunction
with the consolidated financial statements and notes presented in this report.
Earnings Summary
----------------
Comparison of the three months ended March 31, 1998 and 1997
------------------------------------------------------------
Net income for the three months ended March 31, 1998 was $7.0 million,
a 6.1% increase over the same period in 1997. Earnings per share of common
stock for the three months ended March 31, 1998 and 1997 were $.34 and $.32,
respectively. The improvement in earnings during the first quarter resulted
primarily from an increase in net interest income after the provision for loan
losses and non-interest income.
Annualized return on average assets was 1.3% for the three months
ended March 31, 1998 and 1997. Annualized return on average equity was 9.7%
compared to 9.8% for the three months ended March 31, 1998 and 1997,
respectively.
The acquisition of Shawnee Bank on June 30, 1997, which was accounted
for under the purchase method of accounting, impacts performance comparisons
between the three-month periods ended March 31, 1998 and 1997. Where
significant, Management's Discussion reflects the impact of this purchase
acquisition on the comparative financial information.
Net Interest Income
-------------------
During a period of stable market rates, net interest income before
the provision for loan losses, for the three months ended March 31, 1998
increased $0.5 million or 2.2% over the same period for 1997. The increase
in net interest income resulted from growth in average earning assets of
$165.7 million or 8.5% and interest bearing liabilities of $131.2 million
or 8.3%. The impact of this growth was partially offset by a reduction in
the net tax equivalent yield on average earning assets to 4.5% for the
three-month period ended March 31, 1998 from 4.8% for the same period in
1997.
Growth in average earning assets was comprised primarily of
increases in taxable securities of $81.7 million or 19.9% and federal funds
sold of $47.6 million or 183.7%. Average rates on these investments remained
stable between the three-month periods ended March 31, 1998 and 1997. Average
loans increased $26.5 million or 2%, while average rates on loans approximated
first quarter 1997 levels. Approximately $10.3 million of the increase in
average loans related to the purchase acquisition of Shawnee Bank. Yields on
average earning assets decreased to 8.1% from 8.2% between the comparative
periods reflecting a shift in balances from higher-yielding loans to
investments.
<PAGE> 10
Growth in average interest bearing liabilities consisted primarily
of an increase in average interest bearing deposits of $102.2 million or
6.8%. Within the deposit category, increases in average interest bearing
demand of $122.7 million or 35% and average certificates of deposit of
$30.3 million or 4%, were partially offset by a reduction in savings
balances of $50.8 million or 13.2%. Approximately $28.4 million of the
increase in average interest bearing deposits related to the purchase
acquisition of Shawnee. The average rate on interest bearing deposits
increased 20 basis points to 4.3% from 4.1% between the comparative periods
reflecting a shift in balances from savings accounts to higher-yielding
money market accounts and certificates of deposit.
Other Income
------------
Other income increased $1.1 million or 28.6%. Trust fee income
increased $0.5 million or 29.2%, reflecting increases in the number of
accounts under administration, the market value of trust assets, and
investment fees associated with the WesMark mutual fund products which
were introduced in early 1997. The market value of trust assets
approximated $2.3 billion as of March 31, 1998, an increase of $520 million
or 29.6% over March 31, 1997. Service charges and other income increased
$0.3 million or 15.3% between the three-month periods ended March 31 1998
and 1997, resulting from an increase in activity charges on deposit accounts.
Other Expense
-------------
Other expense increased $1.0 million or 6.3%. Salaries and employee
benefits increased $0.6 million or 7.3% during the comparative period, due to
the purchase acquisition of Shawnee Bank, staffing increases associated with
the expansion of WesBanco's mortgage banking affiliate and normal salary
adjustments. Other operating expense increased $0.4 million or 8.1% due to
professional fees associated with improving fee income levels and operational
efficiencies, and expenses relating to the Shawnee Bank purchase.
Income Taxes
------------
A reconciliation of the average federal statutory tax rate to the
reported effective tax rate attributable to income from operations follows:
For the three months
ended March 31,
--------------------
1998 1997
---- ----
Federal statutory tax rate 35% 35%
Tax-exempt interest income from securities
of states and political subdivisions (8) (9)
State income tax - net of federal tax effect 3 3
Alternative minimum tax credit
carryforward recognized - (3)
All other - net 2 2
------ ------
Effective tax rate 32% 28%
====== ======
<PAGE> 11
The increase in the effective tax rate resulted from the utilization
of approximately $0.2 million in credits for prior years' minimum taxes
during the first quarter of 1997. These tax credits were fully utilized as
of December 31, 1997.
Financial Condition
-------------------
Total assets of WesBanco as of March 31, 1998 were $2.3 billion
compared to $2.2 billion as of December 31, 1997, an increase of 3.1%.
During the first quarter ended March 31, 1998, WesBanco experienced increases
in deposits and investment securities. Loans, including loans held for sale,
approximated December 31, 1997 levels. Competitive pricing and marketing of
deposit products contributed to a $62.1 million or 3.5% increase in deposits
during the first quarter of 1998. Loan volume, while stable overall during
the quarter, reflected seasonal reductions in consumer lending.
Investment Securities
---------------------
The following table shows the composition of the investment securities
portfolio:
March 31, December 31,
(in thousands) 1998 1997
-------------------------
Securities Available for Sale (at market):
- ------------------------------------------
U. S. Treasury and federal agency securities $308,449 $247,042
Obligations of states and political subdivisions 20,254 20,638
Corporate securities 21,012 8,540
Mortgage-backed securities 115,814 100,931
Other debt and equity securities 6,305 5,859
--------- ---------
Total available for sale 471,834 383,010
--------- ---------
Securities Held to Maturity (at cost):
- --------------------------------------
U.S. Treasury and federal agency securities 78,366 79,220
Obligations of states and political subdivisions 167,737 164,684
Other debt securities 2,332 2,304
-------- ---------
Total held to maturity (market value of $252,952
and $249,165, respectively) 248,435 246,208
-------- ---------
Total securities $720,269 $629,218
======== =========
The market value adjustment, before tax effect, in the available for
sale securities portfolio reflected unrealized net gains of $4.0 million as of
March 31, 1998 compared to unrealized net gains of $2.9 million as of
December 31, 1997. These adjustments represent temporary market value
fluctuations caused by general changes in market rates and the length of time
to respective maturity dates. If these securities were held until their
respective maturity date, no market value adjustment would be realized.
<PAGE> 12
Loans
-----
The following table shows the composition of the loan portfolio:
March 31, December 31,
(in thousands) 1998 1997
Loans: --------------------------
Commercial $ 253,597 $ 243,458
Real Estate - Construction 37,256 37,743
Real Estate - Mortgage 716,370 715,819
Personal, net of unearned income 323,617 333,176
Loans held for sale 16,319 11,705
---------- ----------
Loans, net of unearned income $1,347,159 $1,341,901
========== ==========
WesBanco monitors the overall quality of its loan portfolio through
various methods. Underwriting policies and guidelines have been established
for all types of credits and management continually monitors the portfolio
for adverse trends in delinquent and non-performing loans.
Loans are considered impaired when it is determined that WesBanco
may not be able to collect all principal and interest due according to the
contractual terms of the loans. Impaired loans, including all non-performing
loans, are as follows:
March 31, December 31,
(in thousands) 1998 1997
Nonperforming loans: --------------------------
Nonaccrual $ 12,059 $ 8,413
Renegotiated 1,517 2,423
Other classified loans 5,185 6,292
---------- ---------
Total impaired loans $ 18,761 $ 17,128
========== =========
The average balance of impaired loans during the three months ended March 31,
1998 and year ended December 31, 1997, was approximately $15,254 and $17,514,
respectively.
Specific allowances for loan losses are allocated for impaired loans
based on the present value of expected future cash flows, or the fair value of
the collateral for loans that are collateral dependent. Related allowances
for loan losses on impaired loans were $3.4 million and $2.6 million as of
March 31, 1998 and December 31, 1997, respectively.
Other real estate owned totaled $6.2 million as of March 31, 1998,
compared to $5.6 million as of December 31, 1997. Loans past due 90 days
or more decreased to $2.3 million or .2% of total loans as of March 31, 1998
as compared to $3.3 million or .2% of total loans as of December 31, 1997.
Lending by WesBanco banks is guided by written lending policies,
which allow for various types of lending. Normal lending practices do not
include the acquisition of high yield non-investment grade loans or "highly
leveraged transactions" ("HLT") from outside the primary market.
<PAGE> 13
Allowance for Loan Losses
-------------------------
Activity in the allowance for loan losses is summarized as follows:
For the three months
ended March 31,
(in thousands) --------------------
1998 1997
-------- --------
Balance, at beginning of period $20,261 $19,102
Allowance for loan losses of acquired bank 329
Charge-offs (1,450) (1,454)
Recoveries 332 280
------- -------
Net charge-offs (1,118) (1,174)
Provision for loan losses 753 1,211
------- -------
Balance, at end of period $20,225 $19,139
======= =======
The allowance for loan losses as a percentage of total loans was 1.50%
as of March 31, 1998 and 1.45% as of March 31, 1997. Amounts allocated to the
allowance for loan losses are based upon management's evaluation of the credit
risk in the loan portfolio. Management believes that the allowance for loan
losses as of March 31, 1998 is adequate to provide for potential losses in the
portfolio.
Deposits
--------
Total deposits increased $62.1 million or 3.5% between March 31, 1998
and December 31, 1997. WesBanco continued to experience growth in both money
market accounts and certificates of deposit. Through competitive products
such as Good Neighbor Banking and the Prime Rate Money Market Account, WesBanco
has sustained steady growth in its deposit base over the past several years.
However, as these higher-yielding deposits increase, savings balances
continue to decline, causing a change in the composition of deposits.
Liquidity and Capital Resources
-------------------------------
WesBanco manages its liquidity position to meet its funding needs,
including potential deposit outflows and loan principal disbursements and to
meet its asset and liability management objectives.
In addition to funds provided from operations, WesBanco's primary
sources of funds are deposits, principal repayments on loans and matured or
called securities. Scheduled loan repayments and maturing securities are
relatively predictable sources of funds. However, deposit flows and
prepayments on loans are significantly influenced by changes in market
interest rates, economic conditions, and competition. WesBanco strives to
manage the pricing of its deposits to maintain a balance of cash flows
commensurate with loan commitments and other funding needs.
WesBanco is subject to risk-based capital guidelines that measure
capital relative to risk-adjusted assets and off-balance sheet financial
instruments. The Corporation's Tier I, total risk-based capital and leverage
ratios are well above the required minimum levels of 4%, 8% and 4%,
respectively.
<PAGE> 14
At March 31, 1998 and December 31, 1997, all of WesBanco's affiliate
banks exceeded the minimum regulatory levels. Capital adequacy ratios are
summarized as follows:
March 31, December 31,
1998 1997
--------------------------
Tier I capital 18.7% 18.7%
Total risk-based capital 20.0% 20.0%
Leverage 12.4% 12.5%
Agreement to Merge
------------------
On March 24, 1998, the Corporation announced the execution of a
definitive Agreement and Plan of Merger providing for the acquisition of
Hunter Insurance Agency, Fairmont, West Virginia, in a stock transaction.
The transaction will be structured as a purchase transaction by WesBanco.
Additionally, on March 24, 1998, WesBanco's Board of Directors
approved a limited stock purchase plan to begin repurchasing up to 62,500
shares of WesBanco common stock to be used for the purpose of acquiring
Hunter Insurance Agency. The timing, price and quantity of purchases will
be at the discretion of the Corporation. This program may be discontinued
or suspended at any time by the Corporation, however, it will terminate
within 30 days subsequent to the consummation of the transaction.
Quantitative and Qualitative Disclosures about Market Risk
----------------------------------------------------------
Through March 31, 1998, there have been no material changes to the
information on this topic as presented in the 1997 Annual Report.
<PAGE> 15
Part II - OTHER INFORMATION
- ---------------------------
Item 1-5 - Not Applicable
- -------------------------
Item 4 - Results of votes of security holders
- ----------------------------------------------
On April 15, 1998 the Annual Meeting of the Stockholders of WesBanco, Inc.
was held.
The following directors were elected to the Board of Directors for a term
of three years expiring at the annual stockholders meeting in 2001:
For Withheld
---------- ---------
1. James E. Altmeyer 11,775,838 88,464
2. James C. Gardill 11,830,037 14,271
3. Richard K. Riederer 11,814,542 29,764
4. Christopher V. Criss 11,830,183 14,125
5. Roland L. Hobbs 11,829,096 15,212
6. J. Christopher Thomas 11,818,506 25,802
7. Stephen F. Decker 11,820,844 23,464
8. Eric Nelson 11,827,445 16,862
The following director was elected to the Board of Directors for a term of
one year expiring at the annual stockholders meeting in 1999:
For Withheld
---------- --------
John R. Scheessele 11,807,983 14,132
The shareholders voted on a proposed amendment to the Articles of
Incorporation for the purpose of increasing the authorized common stock of
the Corporation, which the Board of Directors may issue, from 25,000,000
shares to 50,000,000 shares at $2.0833 par value.
For Against Abstained
---------- -------- ---------
11,125,040 496,691 193,734
The shareholders voted on a Key Executive Incentive Bonus and Option Plan.
For Against Abstained
---------- ------- --------
10,373,623 902,598 568,075
Item 6(a) - Exhibits
- --------------------
3 Articles of Amendment to the Articles of Incorporation of WesBanco, Inc.
10 Key Executive Incentive Bonus and Option Plan*
27 Financial Data Schedule required by Article 9 of Regulation S-X.
99 Press release dated March 24, 1998, announcing the execution of a
definitive Agreement and Plan of Merger providing for the acquisition
of Hunter Insurance Agency.
* This document is being incorporated by reference with respect to Appendix A
of the Proxy Statement filed by the Registrant with the Securities and
Exchange Commission on March 13, 1998.
<PAGE> 16
Item 6(b) - Reports on Form 8-K
- -------------------------------
On April 16, 1998, the Registrant filed a current report on Form 8-K,
dated March 31, 1998, announcing the consummation of WesBanco's business
combination with Commercial BancShares.
<PAGE> 17
SIGNATURES
- ----------
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WESBANCO, INC.
--------------
May 14, 1998 /s/ Edward M. George
-------------------------------------
Edward M. George
President and Chief Executive Officer
May 14, 1998 /s/ Paul M. Limbert
-------------------------------------
Paul M. Limbert
Executive Vice President and Chief
Financial Officer
<PAGE> 18
Exhibit 3
---------
STATE OF WEST VIRGINIA
(SEAL)
CERTIFICATE
I, KEN HECHLER, SECRETARY OF STATE OF THE
STATE OF WEST VIRGINIA, HEREBY CERTIFY THAT
originals of the Articles of Amendment to the Articles of Incorporation of
WESBANCO, INC.
are filed in my office, signed and verified, as required by the provisions of
Chapter 31, Article 1, Section 31 of the West Virginia Code and conform to
law. Therefore, I issue this
CERTIFICATE OF AMENDMENT TO THE ARTICLES OF INCORPORATION
of the corporation, to which I have attached a duplicate original of the
Articles of Amendment.
Given under my hand and the Great Seal of
of the State of West Virginia on this
(SEAL)
Twenty-First day of April, 1998
/s/ Ken Hechler
Secretary of State
<PAGE> 19
Filing Fee: $25.00
License Fee: $-0-
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
WESBANCO, INC.
Pursuant to the provisions of Section 31, Article 1, Chapter 31 of the
Code of West Virginia, the undersigned corporation adopted the following
Articles of Amendment to its Articles of Incorporation:
FIRST: The name of the corporation is Wesbanco, Inc.
SECOND: The following Amendment to the Articles of Incorporation was
adopted by the shareholders of the corporation on April 15, 1998, in the
manner prescribed by Sections 107 and 147, Article 1, Chapter 31:
That the authorized common stock of the corporation be increased
from 25,000,000 shares of the par value of $2.0833 per share to 50,000,000
shares of the par value of $2.0833 per share.
THIRD: Article IV of the Articles of Incorporation of Wesbanco, Inc.
shall, accordingly, be amended and reenacted to read as follows:
IV. The total number of shares of all classes of capital stock which
the corporation shall have authority to issue shall be 51,000,000 shares,
which shall be divided into 50,000,000 shares of common stock of the par
value of $2.0833 per share, and 1,000,000 shares of preferred stock, without
par value.
(1) The designations, powers, rights and preferences, and the
qualifications, limitations and restrictions, of the preferred stock shall be
as fixed and determined, from time to time, by the Board of Directors, and
the Board of Directors is authorized and empowered at any time, and from time
to time, to direct and provide for the issuance of shares of preferred stock
in one or more classes or series, with such voting powers, full or limited,
but not to exceed one vote per share, or without voting power, and with such
dividend rights, rates and conditions, and such designations, preferences and
relative, participating, optional or other special rights, and qualifications,
limitations, or restrictions thereof, as shall be fixed and determined by the
Board of Directors, by resolutions duly adopted.
FOURTH: The number of shares outstanding at the time of such adoption
was 15,982,960 shares and the number of shares entitled to vote was 15,982,960
shares.
FIFTH: The designation and number of outstanding shares of each class
entitled to vote, as a class, were as follows:
<PAGE> 20
CLASS NUMBER OF SHARES
----- ----------------
Common 15,982,960
SIXTH: The number of shares voted for such amendments was 11,125,040;
the number of shares voted against such amendments was 496,691; and the
number of shares abstaining was 193,734.
SEVENTH: The number of shares of each class entitled to vote as a
class voted for and against such amendments was:
CLASS NUMBER OF SHARES VOTED
----- ----------------------
Common For:11,125,040 Against: 496,691 Abstain: 193,734
EIGHTH: The manner in which any exchange, reclassification or
cancellation of issued shares provided for in the amendments shall be affected,
is as follows: All outstanding certificates shall be unaffected by the change
and shall continue to represent the number of shares reflected thereon.
NINTH: The amount of the authorized capital stock of this corporation
shall be increased from the current 26,000,000 shares, which is divided into
25,000,000 shares of common stock of the par value of $2.0833 per share, and
1,000,000 shares of preferred stock, without par value, to 51,000,000 shares
consisting of 50,000,000 shares of common stock of the par value of $2.0833,
and 1,000,000 shares of preferred stock, without par value.
Dated this 15th day of April, 1998.
WESBANCO, INC.
By /s/ Edward M. George
-----------------------
Its President
And /s/ Larry G. Johnson
----------------------
Its Secretary
<PAGE> 21
STATE OF WEST VIRGINIA,
COUNTY OF OHIO, TO-WIT:
I, James C. Gardill, a Notary Public, do hereby certify
that on this 15th day of April, 1998, personally appeared before
me, EDWARD M. GEORGE and LARRY G. JOHNSON, who, being by me first duly sworn,
declared that they are the President and Secretary, respectively, of WESBANCO,
INC., that they signed the foregoing document as President and Secretary of
the corporation, and that the statements therein contained are true.
/s/ James C. Gardill
---------------------
Notary Public
My commission expires:
10/24/05
- ---------------
(NOTARIAL SEAL)
This instrument was prepared by James C. Gardill, Esq., PHILLIPS, GARDILL,
KAISER & ALTMEYER, 61-14th Street, Wheeling, WV, 26003.
<PAGE> 22
Exhibit 99
----------
NEWS FOR IMMEDIATE RELEASE
March 24, 1998 For Further Information Contact:
Edward M. George
President & CEO (304) 234-9208
Nasdaq Trading Symbol: WSBC
WesBanco To Acquire The Hunter Insurance Agency
Wheeling, WV. . . WesBanco, Inc. President & CEO, Edward M. George, today
announced that WesBanco, Inc., has executed a Definitive Agreement and Plan
of Merger providing for the acquisition of the Hunter Insurance Agency,
Fairmont, West Virginia, in a stock transaction. The transaction will be
structured as a purchase transaction by WesBanco.
The Hunter Insurance Agency, a full service agency and seller of life,
casualty and commercial insurance, has been in business since 1937.
In commenting on the purchase, Mr. George stated, "We are pleased to
announce this affiliation of the Hunter Insurance Agency. This acquisition
will afford WesBanco an entry into the life, casualty and commercial insurance
agency business. We look forward to the expansion of our financial services
product mix. The addition of insurance products affords WesBanco the
opportunity to provide our customers with a full array of financial products
and services."
According to Mr. George, the directors, officers and employees currently
associated with the Hunter Insurance Agency would maintain their respective
positions within the company after the acquisition. Bruce D. Martin, CIC,
will continue to serve as the President and CEO of the agency upon its
acquisition by WesBanco.
In conjunction with the purchase of the Hunter Insurance Agency, Mr. George
also announced that the WesBanco Board of Directors has approved a limited
stock purchase plan to begin repurchasing up to 62,500 shares of WesBanco
common stock. The timing, price and quantity of purchases will be at the
discretion of the Corporation. This program may be discontinued or suspended
at any time.
###
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