First Busey Corporation
Annual Report 2004

Plain-text annual report

a 0 CORPORATE PROFILE First Busey Corporation is a finan- cial holding company headquartered in Urbana, Illinois. First Busey Corporation has three wholly-owned banking subsidiaries with locations in three states. Busey Bank is head- quartered in Urbana, I l h o i s and has seventeen banking centers serving Champaign, McLean and Ford Counties in Illinois. Busey Bank also has a banking center in Indianapolis, Indiana and loan pro- duction offices in Ft. Myers and Naples, Florida. Total assets of Busey Bank were $1.5 billion as of December 31,2004. Busey Bank Florida is a federal thrift headquar- tered in Ft. Myers, Florida with two additional banking centers in Cape Cord, Florida. Total assets Of Busey Bank Florida Were $176 million as Of D ~ e m b e r 31,2004. On June 1,20047 First Busey Corporation completed its acquisition O f First Capital Bank in Peoria, Illinois. First Capital Bank has three banking centers in Peoria and one in Pekin, Illinois. Total assets of First Capital Bank as of December 31,2004 were $250 million. Busey provides electronic delivery of financial services through Busey e-bank, at www.bwey.com. Busey Investment Group is a whol- ly-owned subsidiary of First Busey Corporation and owns three sub- sidiaries. First Busey Trust & Investment Co. specializes in asset management and trust services. First Busey Securities, Inc. (mem- ber NASDISIPC) is a full-service brokerldealer subsidiary. Busey Insurance Services, Inc. provides personal insurance products and specializes in long-term healthcare insurance. Busey Investment Group has approximately $2 billion in assets under care. First ~ u s e y Corporation Common Stock is traded on the Na&q National Market under the symbol BUSE. First Busey Corporation has a Repurchase Bogram in effect under which it is authorized to pur- chase up to 750,000 shares of stock. BUSE closed on December 31,2004 at $20.87, an increase of 15.9% from the closing price of $18.00 on December 31,2003. TABLE OF CONTENTS .................................................. ~ t t e r to Shareholders ........................................ Champaign & Ford Counties ............................................................... McLean County ......................................... Peoria & Tazewell Counties ..................................................................... Indianapolis .............................................................................. Florida ....................................................... Boar~s of Directors SHAREHOLDER INFORMATION Corporate Headquarters First Busey Corporation, 201 W. Main Street, Urbana, Illinois 61801, (217) 365-4556. Visit Busey’s world wide web site at www.v.busey.com. Annual Meeting The Annual Meeting of Shareholders of First Busey Corporation will be held on Tuesday, April 26,2005, at Champaign Country Club, 1211 S. Prospect, Champaign, Illinois. First Busey Corporation Common Stock First Busey Corporation Common Stock is traded on the Nasdaq National Market under the symbol “BUSE.” First Busey Corporation’s market makers are Howe Barnes Investments, Inc., Chicago; Stephens Inc., Little Rock; and Stifel, Nicolaus & Company, Inc., St. Louis. Annual Report on Form 10-K A copy of the Annual Report on Form 10-K filed with the Securities and Exchange Commission may be obtained at www.busey.com on March 17,2005 - click on Investor Relations. Stock Transfer Agent First Busey Corporation acts as its own transfer agent. FORWARD LOOKING STATEMENTS This presentation includes forward looking statements that are intended to be covered by the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These fonvard looking statements include, but are not limited to, comments with respect to the objectives and strategies, financial condition, results of operations and business of First Busey. These fonvard looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and the risk that predictions and other forward looking statements dl not be achieved. First Busey cautions you not to place undue reliance on these fonvard looking statements as a number of important factors could cause actu a l future results to differ materially from the plans, objectives, expectations, estimates and intentions such forward looking statements. These risks, uncertainties and other factors include: The general state of the economy, both on a local and national level; The abllity of First Busey to complete acquisitions successfully; 0 The continued growth in the geographic area in which the b a g subsidiaries operate; and 0 The retention of individuals who currently are very important in the management structure of * The results for Busey Bank for 2004 showed a modest increase of 4.7% in net income. Though Busey has historically experienced greater increases, we are comfortable with the 2004 results given the signifi- cant decrease in mortgage loan activity. In 2003, Busey Bank recognized $5,950,000 in gains on the sale of first real estate mortgages, while in 2004, that figure dropped to $2,352,000. Busey Bank’s credit quality continues to be excellent with non-performing loans at .26% of outstanding loans. ank Florida had a record-setting year in 2004. k started the year with $113,441,000 in total bank also enhanced its bottom line. Net income €or Busey Bank Florida increased 448.7% to $1,573,000 compared to $287,000 in 2003. We continue to explore the tremendous growth opportunities in the markets we serve in Florida. The Busey organization achieved another 2004 when Busey Investment Group (BIG $2 billion in assets under care. Net income for BIG in 2004 climbed 22.8% to end the year compared to $1,620,000. We continue to expand the services and locations of our asset management team. I performer due to our top-notch associates. They embrace our blueprint for the future, Vision 2010. They strive to provide the finest in financial services to our clients. They contribute tremendously to the communities we serve. They are the reasun for our success! Thanks to each and every one of you, our Shareholders, for the continued confidence you show in the Busey Organization. As we look to 2005, we continue our commitment to k Throughout 2004 there was always something new on the horizon to attract customers to Busey and to enhance existing relationships. The results were a record-setting year and a platform of new services along with improved facilities and infrastructure. In 2004 we reaffirmed our commitment to branch bank- ing. While we have more than 20,000 customers who regu- larly use Busey’s electronic banking product, ebank, we know that customers still want the opportunity to interact with people. We are committed to drawing customers into our branches to serve their financial needs. In this age of Internet banking, service is more important than ever. In 2005 we continue to evaluate ways to enhance customer service, including upgrading our banking facilities. We dy begun remodeling our Cham * Check images on CD ACH processing system Enhanced cash management and luck box services The results were outstanding! Our sales team called on more than 2,000 business customers and prospects and generated a substantial volume in new deposits and fee $813 million in our well-diversified portfolio. Perhaps most importantly, the quality of our assets is excellent, with the average monthly percentage of past-due loan the lowest level in 5 years. Operating in strong and sta economic environments contributes to the quality of our loan portfolio. Tu meet the demand for commercial loans, we added lenders in Champaign and McLean Counties. Because loan demand in Southwest Florida remains robust, w e have also added two experienced commercial lenders in our Florida Loan Production Office. With interest rates above the record lows set in 2003, mortgage refinancing declined from the previous year. Busey was able to retain its position as the number one mortgage lender in Champaign County. Mortgage lending The year 2004 was also a record-setting one for Busey Investment Group, the parent company for First Busey Trust & Investment Co., First Busey Securities, Inc. and Busey Insurance Services, Inc. Profits exceeded $1.9 mil- lion, and assets under care reached $2 billion. The follow- ing strategies helped us to increase the number of both individual and business customers: Established office hours at Clark-Lindsey Village in Urbana Expanded tax return service for trust customers Introduced Busey Capital Management for fully managed accounts Offered First Busey Securities’ customers the -. option of online statements - * Capitalized on employee referrals which generated more than 400 new customers Referred more than $6.2 million in deposits and $1 million in loans to Busey Bank Expanded the marketing of Physician Advisory Resources, LLC First Busey Securities, Inc. selected as the only firm south of Interstate 80 in Illinois to offer Morningstar’s Management Portfolios I I I In 2003 we formed Physician Advisory Resources, LLC, a joint venture with Cozad Asset Management, Inc. to serve the financial and investment needs of physicians. In 2004, three PAR principals were recognized amung the tributed to the in farmland sale division of Busey Bank, also con- of the organization in 2004. While ore business of farm management, s involved in more than $8 million s group also expanded its appraisal Record yields for both corn and Busey’s investment in technology is significant and impacts every aspect of our business. In 2004 we made technology investments to ensure compriance with the USA Patriot Act and Graham-Leach-Bliley Act (GLBA). We used technology to educate our employees about these measures so they coufd answer all customer questions. images, have not yet been set, we are working with our major banking correspondents and the Federal Reserve System to implement this new procedure. Community service is at the heart of the Busey organization each and every 004 was no exception. This past year our associates continu the Busey tradition of being ac community volunteers in a wide range s. Moreover, Busey contin- significant donor to organi- ions in the communities we serve. ociates were also involved 52nd Economic Seminar in Champaign County and expanded seminar locations to include Rantoul, Gibson City, and Bloomington-Normal. Busey Investment Group hosted seminars in McLean County and Peoria in addition to its annual series in Champaign County. Our community service and high level of visibility helped us reach new customers and reaffirm with our exist- ing customers that they have made the right choice with Busey. “Little Horse on the Prairie” was Busey’s entry in the United Way of Champaign County‘s Carousel of Caring fund raiser. Busey Sr. Graphic Artist, Lonna Pruitt, designed and created this e m which featured numerous We truly expanded our horizons in 2004 with enhanced facilities, customer service inno- vations, and a host of new financial services. The sun rises each day on a bigger and ever- changing marketplace where Busey stands With its robust economy and above-average household income, McLean County continues to be a bright spot on the Central Illinois horizon for Busey. In 2004, we invest- ed additional resources so that we can better serve this important market. The total renovation of our office on Fairway Drive in Bloomington was completed in 2004 and included an innovative approach to customer service -the Financial Service Counter. As customers walk in the front door, they are greeted by Busey Associates who can immedi- ately assist them with a number of banking transactions or direct them to the appropriate personnel. We’ve learned that customers want efficient, personal service, and the Financial Service Counter enables us to respond to their wishes. The Financial Service Counter allows us to use technology to support a high level of customer service. The completely remodeled Fairway Drive office also features new and improved facilities for o w com- mercial and mortgage lending customers. On the horizon for 2005 is a new office in Normal at the corner of F’t. Jesse Road and Towanda Avenue, a rapidly growing area that will also see the addition of a Home Depot and Walgreen Drug Store in 2005, Other plans include additional ATMs at key locations throughout Bloomington-Normal. In 2004 we also rdocated the office of First Busey Trust & Investment Co. and First Busey Securities to a new office complex on Eastland Drive. As we continue to expand our presence in this fast-growing area, we antici- pate adding more trust, investment, and brokerage asso- ciates. Busey’s investment in McLean County is more than brick and mortar. In expanding our horizons to the west, we brought along our commitment to invest in the communi- ties we serve. In addition to loans to businesses and indi- viduals, we contributed to several significant community projects such as: Prairie Aviation Museum Challenger Learning Center Children’s Discovery Museum Ed Scharlau’s Economic Seminar, which is sponsored by the McLean County Chamber of Commerce, has also become an annual event with attendance growing every year. These 2004 highlights demonstrate Busey’s commitment to staying ahead of the curve while maintaining our tra- dition of excellent customer service and community involvement. In McLean County, we are committed to growing our business by making it more convenient than ever to bank with us and by adding innovative approaches to customer service. We strive to be highly visible in the com- munities we serve through our work and our service as active community Our innovative Financial Service Counter at the Fairway Drive, Bhmington branch. Bloomington-Normal is home to a number of emerging entrepreneurial ventures that resulted from research projects at Illinois State University, Illinois Wesleyan University, and Heartland Community College. Busey’s expertise in working with technology transfer from the university setting to the private sector enables us to serve v o h t e e r s . These values guide us as we expand our hori- Eons in our current locations and develop new markets and opportunities. I PEORIA & TAZEWELL COUNTIES Busey started the year by expanding our horizons along the 1-74 corridor with the acquisition of First Capital Bankshares, Inc. of Peoria. The acquisition closed on June merged into Busey Ban First Capital attracted u Peoria’s status as an international port of entry $800 million invested annually in research by Peoria businesses and universities 25 million expansion of St. Francis tution. During &e past deca ter the Peoria market rowing financial insti- economy has been expansion in the Midwest. Following our successful move into McLean County, Peoria was the logical next step. Located approximately 30 miles apart, Bloomington- market for both extremely high level of personal service along with inno- vative products, such as a courier service and over-night sweep accounts. One of First Capital’s four branches is located in a business incubator office building in an area undergoing a major urban renewal effort. In short, First Capital is focused, innovative, and aggressive, and we like the way they do business. Peoria. In 2004, we added a seas expand the financial services available to our Peoria clients. We will utilize our proven marketing approach of seminars and personal calls to attract new clients. Another major emphasis in the Peoria market is to continue to focus on serving the needs of the commercial customer. Busey’s full array of commercial pro In First Capital we also found a bank that shared Busey’s commitment to community service. First Capital manage- ment and associates are active volunteers, and the bank supports a number of important civic initiatives. Our corporate cultures atch. it ge 004 with total assets of lation with more than 26,000 new residents in 2004 and Busey Bank was there to meet the financial needs of this rapidly growing population. The performance of Busey Bank Florida in 2004 reflects this dynamic market: Total assets grew 55.0% from $113.4 million to $175.8 million Total loans grew 80.5% from $88.1 million to $159.0 million Total deposits grew 55.4% from $97.4 million to $151.4 million Total profits grew 448.1% from $287,000 to $1,573,000 Innovative products such as Active Interest Checking and Business Manager, an accounts-receivable financing program, attracted new retail and commercial customers. The Bank also took a giant step forward in meeting the needs of the first-time homebuyer by expanding our resi- dential construction lending program. This new program generated an average of 70 new home loans per month, representing $12,000,000 in new monthly loan volume. Even the hurricanes that hit Florida's West Coast did not slow us down. Busey Bank is headquartered in F't. Myers with two loca- tions in Cape Coral. In 2005, we will expand our horizons once again with the construction of a 12,000 square foot financial center in Cape Coral. The following economic and demographic data show some of the reasons why we view Southwest Florida as having additional significant growth potential. e The population of Lee County has grown from 440,000 to over 520,000 since 2000, an increase of 18% The number of single-family home permits issued in Lee County increased from 5,165 to over 12,700 since 2000 The Southwest Florida International Airport located in Ft. Myers is the eighth fastest- growing airport in the U.S. and will open a new $438 million facility in 2005 Lee County plans to construct 7 new public schools in 2005 Busey Bank on Surnmerlin Lakes Dr. in Ft. Myers received damage to signage and landscapingfrom Humc~ne Charley in August. Fortunately, the devastating stonns that ravaged Florida during the summer of 2004 did not harm any Busey associates or theirfamilies. Busey Bank Florida has experienced tremendous success in its first four years. Competing with national and regional money cen- ter banks, Busey offers a welcome environment to indi- viduals and small businesses looking for personal service, local decision making and a vast menu of banking prod- ucts and services. Larger businesses appreciate the f cia1 resources that Busey has th and expertise of a tion through its pa sister banks in Illino Southwest Florida is home to thousands of entrepreneurial business people who nities . First Busey Corporation Board of Directors Busey Bank Florida Board of Directors Joseph M. Ambrose Dr. David L. Ikenberry E. Phillips Knox V.B. Leister, Jr. Douglas C. Mills Joseph E. O'Brien Arthur R.Wyatt Todd A. Caruso Carol Conway Michael J. Frye Michael P. Gem1 Robert Greco Edwin A. Scharlau, I1 Busey Bank and Busey Investment Group Board of Directors First Capital Bank Board of Directors Samuel P. Banks T.O. Dawson Victor F. Feldman, MD Patrick T. Fitzgerald Kenneth M. Hendren E. Phillips Knox Barbara J. Kuhl P. David Kuhl Daniel P. Daly Jonathan E. Michael V.B. Leister, Jr. James R. Debord, MD Douglas C. Mills E. Lee Hofmann Barbara J. Kuhl Joseph E. O'Brien Matthew J. Vonachen David D. Mills Linda M. Mills Edwin A. Scharlau, I1 David C. Thies Steven J. Wannemacher FIRST BUSEY CORPORATION BUSEY BANK Douglas C. Mills, Chairman of the Board and Chief Executive Officer Edwin A. Scharlau 11, Vice Chairman Barbara J. Kuhl, President, Chief Operating Officer, Corporate Secretary and Treasurer Barbara J. Harrington, Executive Vice President and Chief Financial Officer Thomas M. Good, Executive Vice President Lisa A. Davis, Senior Vice President Carol A. Slough, Senior Vice President FIRST CAPITAL BANK Daniel P. Daly, President and Chief Executive Officer Anthony Lees, Senior Vice President BUSEY BANK FLORIDA Michael P. Geml, President Randy C. Eddy, Senior Vice President Pamela J. Irvin, Senior Vice President FIRST BUSEY TRUST & INVESTMENT, CO. Glen C. Paine, Chairman R. Scott MacAdam, President & Chief Executive Officer Elizabeth B. Czys, Senior Vice President Gregory W. Fink, Senior Vice President Elizabeth A. Krchak, Senior Vice President Gregg McElroy, Senior Vice President R. Michael Murphy, Senior Vice President FIRST BUSEY SECURITIES, INC. Curt A. Anderson, President and Chief Executive Officer Pamela S. Zimrnerrnan, Senior Vice President P. David Kuhl, Chairman of the Board and Chief Executive Officer David D. Mills, President and Chief Operating Officer Susan E. Abbott, Executive Vice President Don A. Monteith, Executive Vice President Lee H. O’Neill, Executive Vice President Donald J. Schlorff, Executive Vice President David R. Wampler, Executive Vice Preisdent Eric E. Eberhardt, Senior Vice President Robert B. Fazzini, Senior Vice President Jeffrey C. Gaines, Senior Vice President David W. Gillon, Senior Vice President Donna J. Gragg , Senior Vice President Kirk L. Harney, Senior Vice President Bruce K. Hatfield, Senior Vice President Louis S. Hensley 111, Senior Vice Resident Richard A, Holiner, Senior Vice President Charles W. Huber, Senior Vice President Jeffrey J. Jacob, Senior Vice President Alan G. Jones, Senior Vice President John A. Kahle, Senior Vice President J. Rod Kirby, Senior Vice President Janis R. Koller, Senior Vice President Larry C. McCIellan, Senior Vice President Dennis R. McMillan, Senior Vice President Steven S. Myers, Senior Vice President James D. Owens, Senior Vice President Edward G. Paine, Senior Vice Presidnet Mary Ann Pankau, Senior Vice President Allan S. Penwell, Senior Vice President Douglas E. Roesch, Senior Vice President Thomas W. Scharlau, Senior Vice President Michael A. Stevenson, Senior Vice President David E. Strang, Senior Vice President Cheryle A. Turner, Senior Vice President Ronald Wesbecher, Senior Vice President Thomas L. Wiggins, Senior Vice President 

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