City Holding Co. announces 2009 earnings

    CHARLESTON -- City Holding Company, a $2.6 billion bank holding company headquartered in Charleston, today announced net income of $42.6 million for the year ended December 31, 2009 compared to $28.1 million during 2008. Diluted earnings per share increased .94 per share, from $1.74 in 2008 to $2.68 in 2009 primarily due to a decrease in other-than-temporary impairment charges on investments and a lower provision for loan losses. Return on assets for the full year was 1.63%, return on tangible equity was 18.0%, the net interest margin was 4.18%, and the efficiency ratio was 50.0%.

    For the fourth quarter of 2009, the Company reported net income of $11.1 million, or .70 per diluted share compared to $4.2 million or .26 per diluted share in the fourth quarter of 2008. For the quarter, the Company achieved a return on assets of 1.69%, a return on tangible equity of 17.7%, a net interest margin of 4.07%, and an efficiency ratio of 50.3%.

    Charles Hageboeck, Chief Executive Officer and President stated "While the U.S. economy continued to struggle in 2009, I am quite pleased with City's results. Our asset quality continues to improve with non-performing assets, net charge-offs, and past due loans all improving as compared to December 31, 2008. We attribute this improvement to our disciplined lending approach and the relative stability of the markets in which we operate. For example, the national unemployment rate was 10.0% for November 2009 compared to 8.4% for West Virginia. Likewise, the national foreclosure rate for November 2009 was 0.24% compared to 0.01% for West Virginia. Our primary asset quality problems continue to be non-owner occupied residential construction at The Greenbrier Resort in White Sulphur Springs, West Virginia and real estate in the Eastern Panhandle of West Virginia, a distant part of the Washington DC metropolitan area. These properties accounted for approximately one half of City's net charge-offs in 2009."

    "City continues to have strong capital, solid liquidity, and a stable core-deposit franchise, and our asset sensitive balance sheet is poised to benefit from future interest rate increases. We are well positioned to compete against banks as they continue to work through asset quality and liquidity issues. We are proud to have been able to maintain our strong quarterly dividend of 34 cents per share while many of our peers eliminated or greatly reduced dividends to shareholders. City remains one of the most profitable, most liquid, and best capitalized publicly traded banks in the U.S. and looks forward to continuing to help our shareholders and customers through this difficult economic environment," Hageboeck concluded.

    City Holding Company is the parent company of City National Bank of West Virginia. City National operates 67 branches across West Virginia, Eastern Kentucky and Southern Ohio.